Change in Directors or Principal Officers, Financial Statements and Exhibits
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
2013 Executive Officer Base Salary
On January 17, 2013, the compensation committee of the board of directors of
Curis, Inc. (the "Company") approved base salaries for the 2013 fiscal year for
the Company's executive officers. The following table sets forth information
regarding each executive officer's 2013 base salary:
Name Salary (1)
Daniel R. Passeri $ 465,000
Michael P. Gray $ 360,000
Mark W. Noel $ 230,000
Maurizio Voi, M.D. $ 410,000
(1) Base salary increases are effective January 1, 2013.
2013 Short Term Incentive Plan
On January 17, 2013, the compensation committee of the board of directors of the Company also approved a 2013 short-term cash incentive arrangement for executive officers, referred to herein as the cash incentive program. The cash incentive program is designed to motivate the Company's executive officers to achieve specified performance objectives for fiscal 2013 and to reward them for their achievement assuming those objectives are met.
Eligibility. To be eligible, an executive officer must be designated by the compensation committee or independent board members as eligible to receive payments under the cash incentive program, must be serving as an executive officer at the time the award is paid and must have achieved a performance evaluation at a "meets expectations" or higher level within the Company's evaluation framework. The compensation committee has determined that as of the date of the adoption of the plan, the following executive officers are eligible to participate in the cash incentive program: Daniel R. Passeri, Chief Executive Officer and President, Maurizio Voi, M.D., Chief Medical and Chief Development Officer, Michael P. Gray, Chief Operating and Chief Financial Officer, and Mark Noel, Vice President Technology Management and Intellectual Property.
Administration. The cash incentive program is administered by the compensation committee. The compensation committee has the authority and discretion to modify performance goals under the cash incentive program and has the right to amend, modify or terminate the cash incentive program at any time.
Awards. The compensation committee has established the following target short-term incentive payment amounts, referred to herein as target amounts, for each executive officer:
Target Incentive Compensation Payment as a
Percentage of 2013 Annual Base Salary, Assuming
Designated Executive Officer 2013 Annual Base Salary Performance at the 100% Level
Daniel R. Passeri $ 465,000 45 % $ 209,250
Maurizio Voi $ 410,000 35 % $ 143,500
Michael P. Gray $ 360,000 35 % $ 126,000
Mark Noel $ 230,000 25 % $ 57,500
Total $ 1,465,000 100 % $ 536,250
The compensation committee has established four weighted categories of corporate goals for 2013. The four categories of corporate goals for 2013 generally relate to the following:
� the advancement of planned clinical trials of CUDC-427, both as a single agent and in combination in solid tumors and hematologic malignancies;
� the advancement of planned clinical trials of CUDC-907, both as a single agent in advanced lymphomas and multiple myeloma and in a clinical study of CUDC-907 in combination in solid tumors;
� completing the ongoing phase I clinical trial of CUDC-101 in locally advanced head and neck cancer patients and progressing preclinical efforts on establishing an oral formulation of CUDC-101; and
� financial performance objectives, including cash management and capital objectives.
Each of the foregoing four categories has been further delineated into three levels of potential achievement: "Threshold;" "Target;" and "Maximum." Cash incentive payments may be paid based upon the degree to which each category of corporate goals has been achieved on this continuum, if at all. For each of the four categories, achievement of performance at the "Threshold" level results in a weighted payment of no less than 50% of the target amount set forth above, achievement of performance at the "Target" level results in a weighted payment equal to 100% of the target amount set forth above, and achievement of performance at the "Maximum" level results in a weighted payment of no more than 150% of the target amount set forth above.
Distribution. The awards generally will be paid in cash. The compensation committee has sole discretion, however, to pay an award using a combination of cash and equity or all equity, any such equity being issued pursuant to the Company's 2010 Stock Incentive Plan. If the compensation committee determines that such payment will be made in whole or in part in the form of equity, the compensation committee shall have the sole discretion to determine the nature, amount and other terms of such equity award. Payment of the awards, if any, will be made after the completion of fiscal year 2013 and no later than March 15, 2014.
Effect of Change in Control. In the event of the consummation of a change in control of the Company on or before December 31, 2013, short-term incentive amounts shall be paid out at 100% of target upon such change in control.
Executive Officer Employment Agreement
On January 18, 2013, the Company and Daniel R. Passeri, the chief executive officer and president of the Company, entered into a letter agreement effective as of December 31, 2012 (the "Letter Agreement"), pursuant to which the parties mutually agreed to extend the term of Mr. Passeri's employment agreement dated as of September 18, 2007, as amended by a letter dated October 27, 2008 and a second amendment to employment agreement dated December 16, 2010 (collectively the "Employment Agreement"), until December 31, 2013.
The forgoing summary of the Letter Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of such Letter Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated into this Item 5.02 by reference.
Correct me if I'm wrong, but isn't a so-called "golden parachute" compensation that is paid to an employee when he screws up, essentially upon termination? Then in what way are the terms of these proposed bonuses golden parachutes? They are performance-based enhancements, nothing more!
Your viewpoint here is very negatively slanted. This is an incentive program which is actually very good management, unless you don't want the management of the company that you invest in to be motivated this year and achieve the four objectives listed, all of which would be catalysts for this stock. If all 4 members were to reach the maximum incentive, it would amount to a total of about 1 million dollars in incentive paid. That is from a company who's market cap is currently at 250 million, and that would no doubt have a much higher market cap (and therefore stoci price) if those incentives were achieved. Be mindful of the fact that the fourth criteria are the "financial objectives" of cash management and capital objectives. In other words they will have to make money to earn more, kind of like performance escalators that you might give a star athlete. Or do you not want this company to make money?
I'm new to investing in this company, but I like what I see from it . There may be a bit of homerism at play here as I'm just north of its location (I believe its in Massachusetts if memory serves correctly) in New Hampshire, but I see a company with pretty solid fundamentals that has some novel medication approaches in a very competitive cancer research industry. It already has one new medication on the market in the US, is close to potentially having a market for that same medication in Europe, is also investigating further applications for that medication, and has a strong and active pipeline to boot. When you consider that its stock is situated in a pretty favorable spot relative to its charting history and "double-bottom," I feel this is a pretty darned good time to get into it.