5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Margolin Transition to Chairman
On January 4, 2019, Alexey Margolin, Ph.D., the Chief Executive Officer of Allena Pharmaceuticals, Inc. (the “Company”) executed a transition agreement with the Company (the “Transition Agreement”) pursuant to which he will resign as Chief Executive Officer of the Company, effective as of February 1, 2019 (the “CEO Transition Date”). Dr. Margolin will remain on the Board of Directors (the “Board”) following his resignation and will transition to Chairman of the Board as of the CEO Transition Date. As anon-employee member of the Board, Dr. Margolin will be eligible to participate in the Company’snon-employee director compensation policy and, pursuant to the Transition Agreement, shall receive an additional cash retainer in 2019 of $80,000 for his service as Chairman. Subject to his continued service on the Board, all outstanding stock options held by Dr. Margolin shall continue to vest according to their existing vesting schedules.
The foregoing description of the Transition Agreement does not purport to be complete and is qualified in its entirety by reference to the full text thereof, which is attached hereto as Exhibit 10.1 and incorporated by reference herein.
Brenner Transition to Chief Executive Officer
On January 4, 2019, Louis Brenner, M.D., the Company’s President and Chief Operating Officer, executed an amended and restated employment agreement with the Company (the “Employment Agreement”) to become the Company’s President and Chief Executive Officer and a member of the Board effective as the CEO Transition Date.
Pursuant to the Employment Agreement, Dr. Brenner’s initial base salary shall be equal to $500,000, his initial annual target incentive compensation shall be equal to fifty percent of his base salary, and he shall be eligible to participate in the Company’s benefit plans as in effect from time to time. The Employment Agreement also provides that Dr. Brenner will be granted an option to purchase 305,000 shares of the Company’s common stock, which shall vest over four years, with 25% vesting on the one year anniversary of the CEO Transition Date and the remaining shares vesting in equal monthly installments thereafter, in each case subject to Dr. Brenner’s continued employment with the Company. In addition, in the event that his employment is terminated by us without “cause” (as defined in the Employment Agreement) or he terminates his employment for “good reason” (as defined in the Employment Agreement), and subject to the delivery of a fully effective release of claims, he will be entitled to an amount equal to twelve (12) months of his then-current base salary plus twelve (12) months of his target annual incentive compensation for the prior fiscal year, payable in substantially equal installments for a period of twelve (12) months following his termination of employment, plus our continued payment of the employer portion of health insurance premiums for twelve (12) months or, if earlier, until such time as Dr. Brenner’s COBRA period expires or he becomes eligible for group health insurance from another employer. If Dr. Brenner’s employment is terminated by us without cause or he terminates his employment for good reason, in each case within 12 months after a change in control, then in lieu of the foregoing severance, and subject to the delivery of a fully effective release of claims, Dr. Brenner will be entitled to receive (i) a lump sum amount equal to the sum of eighteen (18) months of his then-current base salary plus his target annual incentive compensation for the year in which the termination occurs, (ii) a prorated portion of the target annual incentive compensation for the year in which the date of termination occurs, payable when the annual incentive compensation would otherwise be paid, (iii) any earned, but unpaid annual bonus for the year immediately prior to the year in which the date of termination occurs and (iv) continued payment of the employer portion of health insurance premiums for eighteen (18) months or, if earlier, until such time as Dr. Brenner’s COBRA period expires or he becomes eligible for group health insurance from another employer. In addition, all time-based stock options or other time-based stock awards granted to Dr. Brenner will accelerate and vest in full.
The foregoing description of the Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the full text thereof, which is attached hereto as Exhibit 10.2 and incorporated by reference herein.
Santini Transition to Lead Independent Director
As of the CEO Transition Date, Gino Santini, currently a member of the Board, including service on the Audit Committee and Compensation Committee, will become the Company’s Lead Independent Director.
