PDL BioPharma 8-K 2014
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 9, 2014
PDL BioPharma, Inc.
(Exact name of Company as specified in its charter)
932 Southwood Boulevard
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions:
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
2014/18 Long-Term Incentive Plan
On April 9, 2014, the Compensation Committee of the Board of the Directors of PDL BioPharma, Inc. (the Compensation Committee) approved a long-term incentive plan to compensate, retain and incentivize its executive officers (the 2014/18 LTIP). The Compensation Committee designated the effective date of the 2014/18 LTIP as January 1, 2014.
Under the 2014/18 LTIP, each executive officer is eligible for awards consisting of restricted stock and cash payments (the Awards) upon the attainment of specified performance goals related to (i) the amount of income generating asset acquisitions accomplished and (ii) the Company’s cash flows from income generating assets. The Compensation Committee fashioned the 2014/18 LTIP so that all awards under the plan are at risk if certain performance criteria are not met.
Each executive officer’s restricted stock award was granted on April 10, 2014, and the number of shares underlying the restricted stock award was determined based on the closing price of the Company’s common stock on April 10, 2014, which was $8.22 per share (rounded to the nearest whole share).
Subject to the acceleration provisions set forth in the severance agreements of the executive officers (disclosed on May 26, 2011), portions of the Awards will vest in December of years two through five of the 2014/18 LTIP, provided the executive officer remains employed by the Company through such date and the specified performance criteria have been accomplished as set forth in the chart below:
In the event that the performance criteria are not met in any of years three through five but at the conclusion of the 2014/18 LTIP the combination of the three years results in maintenance of cash flows at 75% or greater than forecasted cash flows for the three year period, then any Awards that did not vest during the three year period shall vest and pay. Dividend payments and other distributions made on the restricted stock during the vesting period of the restricted stock will accrue through the vesting period and will be paid, plus interest, to the executive officer upon vesting of the restricted stock award.
The target Awards for each executive officer are set forth in the chart below:
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: April 15, 2014