Directors' Remuneration Report
(CON TINUE D)
Pension and Ot her Benefit s
Executive Directors' basic salaries are set at levels which are
deemed to include adequate provision for pension contributions.
Each Executive Director is free to determine the amount
of pension contribution payable from salary, given the age
of the relevant Director and other personal circumstances.
Executive Directors are entitled to make contributions from
salary into the Group's 401(k) (see Directors' Pension Arrangements
below). The Group funds the provision of private medical
insurance cover for Executive Directors and their immediate
family and Executive Directors participate in the Group's life
insurance scheme, which has a lump sum payment in the event
of death in service.
Executi ve Dir ectors' Service Contr acts
Dr. Armstrong entered into a service agreement with the
Group, the principal terms of which were that if the Group
terminated his employment, other than for good cause, the
Group would pay to him the amount outstanding up to the
date of the termination. In addition, if Dr. Armstrong's employment
was terminated by the Group without good cause or
if he resigned with good reason, the Group would pay an
amount equal to the eighteen months' base salary and bonus,
as well as accelerating the vesting of shares which would
become free of re-purchase obligations in the current and subsequent
year after the date of termination. On 4 January 2010
Dr. Armstrong resigned and received a termination payment
of US $547,500 payable through March 2011. In addition, as a
result of Dr. Armstrong's resignation, the Group accelerated
the vesting of the final 25% of the original stock grant of
602,561 shares (150,403 shares) and re-priced the stock compensation
expense from US $9.28 per share to US $0.15 per
share, the share price at Dr. Armstrong's termination date.
Kerdos Corporate Finance Limited (KC FL) entered into a consultant
agreement for the services of Mr. Bigsby as the Chief
Financial Officer of the Group. Mr. Bigsby was entitled to
participate in the 2010 Bonus Plan while engaged by the
Group. The contract was terminated on 4 August 2010 with
the resignation of Mr. Bigsby.
Mr. Reade entered into an employment agreement with the
Company on 16 May 2010, the principle terms of which are
that if the Company terminates his employment, other than
for good cause, or if he resigns with good reason, he will be
eligible, but not entitled to a sum equal to his annual base
salary and bonus, as well as accelerating the vesting of
shares which would become free of re-purchase obligations
for the complete year after the date of termination. Mr. Reade
may terminate the employment agreement on six months
written notice.
Non-executi ve Dir ectors' Lett ers of App ointment
Dr. Vernon, Mr. Reade, Mr. Riley and Dr. Noonan entered into
agreements with the Group on 25 May 2007, which govern the
terms and conditions of their appointment as Nonexecutive
Directors of the Group. Each appointment was for
an initial term expiring upon conclusion of the next annual
general meeting of the Group unless renewed at the end of
that period for a further 12 month period. Dr. Vernon was
entitled to fees totaling £47,500 for the year payable to
Ziggus Holding Limited, of which Dr. Vernon is an employee.
Mr. Reade was entitled to fees totaling £35,000 for the
year payable to Global Strategy Expression Limited of
which Mr. Reade is an employee. This fee arrangement with
Mr. Reade was terminated when he assumed the Executive
Chairman post. Dr. Noonan was entitled to fees totaling
£32,500 for the year payable to T. K. Advisory Limited of which
Dr. Noonan is an employee. Mr. Riley was entitled to fees of
£35,000 for the year payable directly. Mr. Regan was appointed
as a representative of Laurus/Valens and received no fees
during the year. Mr. Hills entered into an agreement with
the Group on 9 July 2010 which governs his term and conditions
of his appointment as a Non-executive Director of the
Group. This appointment is for an initial term expiring upon
conclusion of the next annual general meeting of the Group
unless renewed at the end of that period for a further 12
month period. Mr. Hills is entitled to fees totaling US $55,000
per year.
In addition to fees, the Company reimburses the independent
Non-E xecutive Directors for all reasonable out-of-pocket
expenses incurred.
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