Business Context and Reporting Period
This Form 8-K Current Report was filed by Pacific Biosciences of California, Inc. on January 5, 2012. The filing reports significant changes in executive leadership effective immediately on the report date.
Key Financial Metrics
The filing does not provide financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on executive compensation arrangements and personnel changes.
Material Changes
- Departure of CEO: Hugh Martin resigned as President and Chief Executive Officer effective January 5, 2012. He will remain on the Board of Directors until the 2012 annual meeting of stockholders.
- Appointment of CEO: Dr. Michael Hunkapiller was appointed President and Chief Executive Officer effective January 5, 2012. He continues to serve as Executive Chairman of the Board.
Compensation, Risks, and Unusual Items
Separation Terms for Hugh Martin
- Lump sum payment equal to 12 months of base salary.
- COBRA coverage reimbursement for 36 months.
- Six months of accelerated vesting on unvested options.
- Consulting role for six months at a fee of $20,000 per month.
- Additional payment of $30,000 upon execution of a separation agreement and release.
Compensation for Dr. Michael Hunkapiller
- Annual base salary of $400,000.
- Target bonus equal to 75% of base salary.
- Option grant to purchase up to 1,000,000 shares of common stock.
- Severance Provisions: Involuntary termination without cause triggers 12 months' salary, 12 months' COBRA, and six months of accelerated vesting. Termination within 12 months of a change of control triggers 12 months' salary, 12 months' COBRA, and 100% vesting of unvested equity.
Related Party Transaction
Dr. Hunkapiller's daughter, Kathryn Keho, is employed by the Company as Director, Scientific Collaborations. Her compensation details are referenced in a prior proxy statement filed on April 29, 2011.
Investor Verification Checklist
- Verify the terms of the separation agreement and release executed by Hugh Martin.
- Review the definitive proxy statement filed on April 29, 2011, for details on Kathryn Keho's compensation.
- Confirm the vesting schedule and exercise price for the 1,000,000 option grant awarded to Dr. Hunkapiller.
- Monitor the Company's 2012 annual meeting of stockholders regarding Mr. Martin's resignation from the Board.