| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On April 4, 2024, Shockwave Medical, Inc., a Delaware corporation (the “Company”) entered into an Agreement and Plan of Merger with Johnson & Johnson, a New Jersey corporation (“Parent”), and Sweep Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), providing for the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Parent.
In connection with the proposed acquisition and at the request of Parent, the Company entered into a retention agreement (the “Retention Agreement”) with Isaac Zacharias, President and Chief Commercial Officer of the Company, on April 4, 2024. The Retention Agreement modifies certain provisions of Mr. Zacharias’s Amended and Restated Separation Pay Agreement with the Company (the “Separation Pay Agreement”).
The Retention Agreement provides that from the closing of the Merger (the “Closing”) through the first anniversary of the Closing (the “Retention Date”), Mr. Zacharias’s title will be President, Shockwave Medical, reporting to the Global Head of Heart Recovery, MedTech, of Parent.
Pursuant to the Retention Agreement, Mr. Zacharias is entitled to a retention opportunity equal to $2,100,000 payable on the Retention Date, subject to Mr. Zacharias’s continued employment with the Company, Parent or their affiliates through the Retention Date.
Notwithstanding the foregoing, if Mr. Zacharias’s employment is terminated prior to the Retention Date other than for Cause (as defined in the Separation Pay Agreement), due to Mr. Zacharias’s death or disability, or if Mr. Zacharias resigns for Good Reason (as defined in the Separation Pay Agreement and modified by the Retention Agreement), then Mr. Zacharias will be entitled to receive the sum of (i) the salary continuation and COBRA continuation benefits payable under the Separation Pay Agreement and (ii) $1,251,924, which sum is equal to $2,100,000, subject to Mr. Zacharias’s execution and non-revocation of a release of claims.
The Retention Agreement also provides that during the 12 months following the Closing, Mr. Zacharias will continue to receive at least the same base salary as he received immediately prior to the Closing and be eligible for at least the same target cash bonus opportunity as he was eligible for immediately prior to the Closing.
Following the Retention Date, Mr. Zacharias will not be entitled to any severance or separation payments or benefits under the Separation Pay Agreement and, if he remains employed by Parent and its affiliates, Mr. Zacharias will be eligible for severance benefits under the applicable severance policy of Parent or its affiliates.
The foregoing description of the Retention Agreement is not complete and is qualified in its entirety by reference to the complete text of the Retention Agreement, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
