| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On April 1, 2023, Spectrum Pharmaceuticals, Inc. (the “Company”) entered into a new employment agreement (the “Employment Agreement”) with Thomas J. Riga, President and Chief Executive Officer of the Company, effective as of April 11, 2023. The Employment Agreement has a term of one year and replaces Mr. Riga’s prior Employment Agreement, dated as of April 10, 2018, which will expire by its terms on April 10, 2023.
Pursuant to the Employment Agreement, Mr. Riga will be entitled to receive an annual base salary of $735,000 as compensation for his services. Mr. Riga will also be eligible to receive an annual cash bonus equal to 70% of his salary, based on the performance of the Company and Mr. Riga relative to performance objectives or other metrics the Board of Directors of the Company may deem appropriate. Mr. Riga will also be eligible to receive grants under any long-term equity-based incentive compensation plans established or maintained by the Company for its senior executive officers, subject to the terms and conditions of the applicable plans and award documents with respect to such grants.
In the event Mr. Riga is terminated by the Company for Cause (as defined in the Employment Agreement), or if Mr. Riga terminates his employment without Good Reason (as defined in the Employment Agreement), Mr. Riga will be entitled to any unpaid base salary and benefits accrued through the date of termination.
In the event Mr. Riga is terminated by the Company without Cause, or if Mr. Riga terminates his employment with Good Reason, Mr. Riga will be entitled to receive any unpaid base salary and benefits accrued through the date of termination, as well as the following severance benefits: (i) two times the sum of (a) Mr. Riga’s base salary then effect and (b) Mr. Riga’s target bonus for the calendar year in which the termination date occurs, (ii) an amount equal to Mr. Riga’s target bonus for the calendar year in which the termination date occurs, prorated based on the number of days Mr. Riga was employed by the Company during such calendar year, and (iii) 18 months of Company-paid continued coverage for Mr. Riga and his dependents under the Company’s existing health and benefit plans. Mr. Riga will also immediately vest in all options, restricted stock and other equity incentive compensation, and will vest in his performance-based awards pro rata based on Mr. Riga’s target award for such performance-based awards and the number of days he was employed by the Company during the applicable performance period, irrespective of actual performance.
All severance payments due to Mr. Riga’s termination without Cause or with Good Reason are subject to the execution and delivery of a general waiver and release of claims within 60 days of the date of termination.
The foregoing description of the Employment Agreement does not purport to be complete and is qualified in its entirety by the full text of the Employment Agreement, which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the period ending March 31, 2023.
