UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_________________________

 

FORM 8-K

 

CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported): March 16, 2015

 

CHAMPIONS ONCOLOGY, INC.

 

(Exact name of registrant as specified in its charter)

  

Delaware 0-17263 52-1401755
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation)   Identification No.)

 

 

1 University Plaza, Suite 307, Hackensack, New Jersey 07601

(Address of Principal Executive Offices) (Zip Code)

 

Registrant’s telephone number, including area code: (201) 808-8400

 

Not applicable

(Former Name or Former Address if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 
 

 

INFORMATION TO BE INCLUDED IN THE REPORT

 

Item 5.02.      Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

On March 16, 2015, the Company and certain members of its senior management team agreed to exchange existing options to purchase shares of the Company’s common stock with new options. The new options have the same values as the existing options, using the Black-Scholes valuation method, in that they are exercisable for fewer shares but at a lower exercise price, and have the same vesting schedules and the same termination expiration dates as the existing options. The members of the senior management team whose options were exchanged include Joel Ackerman, the Company’s Chief Executive Officer and a member of its Board of Directors, Ronnie Morris, the Company’s President and a member of its Board of Directors, James McGorry, the Company’s Executive Vice President and General Manager, Translational Oncology Solutions and David Miller, the Company’s Vice President, Finance. As a result of the option exchange, an aggregate of 19,872,875 existing options with exercise prices ranging from $0.47 to $1.25 per share were exchanged for an aggregate of 17,617,929 new options with exercise prices of $0.41 per share.

 

Also on March 16, 2015, the Company and each of Mr. Ackerman and Dr. Morris agreed to amend their employment agreements with the Company. Their current employment agreements provide that, for the year from November 1, 2014 to October 31, 2015, Mr. Ackerman and Dr. Morris’s salaries would be paid half in cash and half in options to purchase shares of common stock. To conserve the Company’s cash, Mr. Ackerman and Dr. Morris have agreed to accept all of their compensation in options, and none of it in cash for such year.

 

The above summaries are qualified in their entirety by reference to the option exchange agreements between the Company and each of Mr. Ackerman, Dr. Morris, Mr. McGorry and Mr. Miller, which are attached hereto as Exhibits 10.1, 10.2, 10.3 and 10.4 respectively, and the Amendments No. 1 to Employment Agreements between the Company and each of Mr. Ackerman and Dr. Morris, which are attached hereto as Exhibits 10.5 and 10.6, respectively.

 

Item 9.01.      Financial Statements and Exhibits.

 

(d)      Exhibits

 

The following exhibits are filed herewith:

 

Exhibit No.

10.1 Option Exchange Agreement dated as of March 16, 2015 between the Company and Joel Ackerman.
10.2 Option Exchange Agreement dated as of March 16, 2015 between the Company and Ronnie Morris.
10.3 Option Exchange Agreement dated as of March 16, 2015 between the Company and James McGorry.
10.4 Option Exchange Agreement dated as of March 16, 2015 between the Company and David Miller.
10.5 Amendment to Employment Agreement dated as of March 16, 2015 between the Company and Joel Ackerman.
10.6 Amendment to Employment Agreement dated as of March 16, 2015 between the Company and Ronnie Morris.

 

 
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  CHAMPIONS ONCOLOGY, INC.  
  (Registrant)  
       
       
Date: March 20, 2015 By: /s/ Joel Ackerman  
    Joel Ackerman  
    Chief Executive Officer  

 

 

Exhibit 10.1  

 

Option Exchange Agreement

 

This Option Exchange Agreement (this “ Agreement ”) is dated as of March 16, 2015 between Champions Oncology, Inc. (the “ Company ”) and Joel Ackerman (the “ Employee ”).

 

WHEREAS , the Company granted the Employee stock options to purchase shares of the Company’s common stock under its 2010 Equity Incentive Plan as set forth on Schedule A attached hereto (each an “ Existing Option ” and collectively the “ Existing Options ”);

 

WHEREAS , the Existing Options have exercise prices per share that are significantly higher than the current market price of the Company’s common stock; and

 

WHEREAS , the Company wishes to offer to exchange each of the Existing Options with a new option (each a “ New Option ” and collectively the “ New Options ”) that will have an exercise price equal to the fair market value of the Company’s stock on the date of grant (which is the date hereof) in order to provide the Employee with the benefit of owning options that over time may have a greater potential to increase in value, and thus create better performance incentives for the Employee and, as a result, maximize shareholder value, and the Employee wishes to accept such offer;

 

NOW, THEREFORE , in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Employee agree as follows:

 

1.                   Each of the Existing Options is hereby cancelled and disposed of, and the Employee has no rights whatsoever with respect to the Existing Options.

 

2.                   The Company shall grant the Employee the New Options in connection with the execution of this Agreement. The New Options shall be subject to the terms of the Company’s 2010 Equity Incentive Plan and otherwise have the terms set forth in the applicable stock option agreement. Each New Option will be for a number of shares that, when combined with the New Option’s exercise price, will have the same Black-Sholes value as the corresponding Existing Option, as set forth on Schedule A . Each New Option will have the same vesting schedule and expiration date as the corresponding Existing Option.

 

3.                   The Employee acknowledges that he has had the opportunity to consult counsel and tax advisors prior to entering into this Agreement. The Employee acknowledges that he is aware of the Company’s business affairs and financial condition, including the risks related to the Company’s business as set forth in the Company’s filings with the Securities and Exchange Commission on Form 10-Q and Form 10-K, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to enter into this Agreement.

 

4.                   The Employee acknowledges and agrees that this Agreement does not affect the “at-will” nature of his employment with the Company and that his employment with the Company can be terminated by the Employee or the Company at any time, with or without notice, unless provided otherwise pursuant to any employment agreement with the Company.

 

5.                   This Agreement shall be governed by the laws of the State of Delaware, without regard to conflicts of laws principles.

 

6.                   This Agreement may be signed in any number of counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

 

[Signature page follows]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first indicated above.

 

 

  CHAMPIONS ONCOLOGY, INC.  
       
  By: /s/ Ronnie Morris  
  Name: Ronnie Morris  
  Title: President  
       
       
  /s/ Joel Ackerman  
  Joel Ackerman  

 

 
 

 

Schedule A

 

      Existing Options     New Options  
Date     Shares     Exercise Price     Shares     Exercise Price  
  October 25, 2010       2,500,000     $ 0.875       2,190,958     $ 0.41  
  October 25, 2010       2,500,000     $ 0.875       2,190,959     $ 0.41  
  November 5, 2013       1,500,000     $ 1.25       1,347,977     $ 0.41  
  November 5, 2013       1,500,000     $ 1.25       1,347,977     $ 0.41  
  November 5, 2013       215,000     $ 1.25       193,210     $ 0.41  
  Total       8,215,000               7,271,081          

 

 

Exhibit 10.2

 

Option Exchange Agreement

 

This Option Exchange Agreement (this “ Agreement ”) is dated as of March 16, 2015 between Champions Oncology, Inc. (the “ Company ”) and Ronnie Morris (the “ Employee ”).

 

WHEREAS , the Company granted the Employee stock options to purchase shares of the Company’s common stock under its 2010 Equity Incentive Plan as set forth on Schedule A attached hereto (each an “ Existing Option ” and collectively the “ Existing Options ”);

 

WHEREAS , the Existing Options have exercise prices per share that are significantly higher than the current market price of the Company’s common stock; and

 

WHEREAS , the Company wishes to offer to exchange each of the Existing Options with a new option (each a “ New Option ” and collectively the “ New Options ”) that will have an exercise price equal to the fair market value of the Company’s stock on the date of grant (which is the date hereof) in order to provide the Employee with the benefit of owning options that over time may have a greater potential to increase in value, and thus create better performance incentives for the Employee and, as a result, maximize shareholder value, and the Employee wishes to accept such offer;

 

NOW, THEREFORE , in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Employee agree as follows:

 

1.                   Each of the Existing Options is hereby cancelled and disposed of, and the Employee has no rights whatsoever with respect to the Existing Options.

 

2.                   The Company shall grant the Employee the New Options in connection with the execution of this Agreement. The New Options shall be subject to the terms of the Company’s 2010 Equity Incentive Plan and otherwise have the terms set forth in the applicable stock option agreement. Each New Option will be for a number of shares that, when combined with the New Option’s exercise price, will have the same Black-Sholes value as the corresponding Existing Option, as set forth on Schedule A . Each New Option will have the same vesting schedule and expiration date as the corresponding Existing Option.

 

3.                   The Employee acknowledges that he has had the opportunity to consult counsel and tax advisors prior to entering into this Agreement. The Employee acknowledges that he is aware of the Company’s business affairs and financial condition, including the risks related to the Company’s business as set forth in the Company’s filings with the Securities and Exchange Commission on Form 10-Q and Form 10-K, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to enter into this Agreement.

 

4.                   The Employee acknowledges and agrees that this Agreement does not affect the “at-will” nature of his employment with the Company and that his employment with the Company can be terminated by the Employee or the Company at any time, with or without notice, unless provided otherwise pursuant to any employment agreement with the Company.

 

5.                   This Agreement shall be governed by the laws of the State of Delaware, without regard to conflicts of laws principles.

 

6.                   This Agreement may be signed in any number of counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

 

[Signature page follows]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first indicated above.

 

 

  CHAMPIONS ONCOLOGY, INC.  
       
  By: /s/ Joel Ackerman  
  Name: Joel Ackerman  
  Title: Chief Executive Officer  
       
       
  /s/ Ronnie Morris  
  Ronnie Morris  

 

 
 

 

Schedule A

  

 

      Existing Options     New Options  
Date     Shares     Exercise Price     Shares     Exercise Price  
  October 25, 2010       2,500,000     $ 0.875       2,190,958     $ 0.41  
  October 25, 2010       2,500,000     $ 0.875       2,190,959     $ 0.41  
  November 5, 2013       1,500,000     $ 1.25       1,347,977     $ 0.41  
  November 5, 2013       1,500,000     $ 1.25       1,347,977     $ 0.41  
  November 5, 2013       215,000     $ 1.25       193,210     $ 0.41  
  Total       8,215,000               7,271,081          

 

 

Exhibit 10.3

 

Option Exchange Agreement

 

This Option Exchange Agreement (this “ Agreement ”) is dated as of March 16, 2015 between Champions Oncology, Inc. (the “ Company ”) and James McGorry (the “ Employee ”).

 

WHEREAS , the Company granted the Employee stock options to purchase shares of the Company’s common stock under its 2010 Equity Incentive Plan as set forth on Schedule A attached hereto (each an “ Existing Option ” and collectively the “ Existing Options ”);

 

WHEREAS , the Existing Options have exercise prices per share that are significantly higher than the current market price of the Company’s common stock; and

 

WHEREAS , the Company wishes to offer to exchange each of the Existing Options with a new option (each a “ New Option ” and collectively the “ New Options ”) that will have an exercise price equal to the fair market value of the Company’s stock on the date of grant (which is the date hereof) in order to provide the Employee with the benefit of owning options that over time may have a greater potential to increase in value, and thus create better performance incentives for the Employee and, as a result, maximize shareholder value, and the Employee wishes to accept such offer;

 

NOW, THEREFORE , in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Employee agree as follows:

 

1.                   Each of the Existing Options is hereby cancelled and disposed of, and the Employee has no rights whatsoever with respect to the Existing Options.

 

2.                   The Company shall grant the Employee the New Options in connection with the execution of this Agreement. The New Options shall be subject to the terms of the Company’s 2010 Equity Incentive Plan and otherwise have the terms set forth in the applicable stock option agreement. Each New Option will be for a number of shares that, when combined with the New Option’s exercise price, will have the same Black-Sholes value as the corresponding Existing Option, as set forth on Schedule A . Each New Option will have the same vesting schedule and expiration date as the corresponding Existing Option.

 

3.                   The Employee acknowledges that he has had the opportunity to consult counsel and tax advisors prior to entering into this Agreement. The Employee acknowledges that he is aware of the Company’s business affairs and financial condition, including the risks related to the Company’s business as set forth in the Company’s filings with the Securities and Exchange Commission on Form 10-Q and Form 10-K, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to enter into this Agreement.

 

4.                   The Employee acknowledges and agrees that this Agreement does not affect the “at-will” nature of his employment with the Company and that his employment with the Company can be terminated by the Employee or the Company at any time, with or without notice, unless provided otherwise pursuant to any employment agreement with the Company.

 

5.                   This Agreement shall be governed by the laws of the State of Delaware, without regard to conflicts of laws principles.

 

6.                   This Agreement may be signed in any number of counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

 

[Signature page follows]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first indicated above.

 

 

  CHAMPIONS ONCOLOGY, INC.  
       
  By: /s/ Joel Ackerman  
  Name: Joel Ackerman  
  Title: Chief Executive Officer  
       
       
  /s/ James McGorry  
  James McGorry  

 

 
 

 

Schedule A

  

      Existing Options     New Options  
Date     Shares     Exercise Price     Shares     Exercise Price  
  September 3, 2013       1,000,000     $ 1.33       890,862     $ 0.41  
  May 20, 2014       17,875     $ 1.01       16,495     $ 0.41  
  Total       1,017,875               907,357          

  

 

Exhibit 10.4

 

Option Exchange Agreement

 

This Option Exchange Agreement (this “ Agreement ”) is dated as of March 16, 2015 between Champions Oncology, Inc. (the “ Company ”) and David Miller (the “ Employee ”).

 

WHEREAS , the Company granted the Employee stock options to purchase shares of the Company’s common stock under its 2010 Equity Incentive Plan as set forth on Schedule A attached hereto (each an “ Existing Option ” and collectively the “ Existing Options ”);

 

WHEREAS , the Existing Options have exercise prices per share that are significantly higher than the current market price of the Company’s common stock; and

 

WHEREAS , the Company wishes to offer to exchange each of the Existing Options with a new option (each a “ New Option ” and collectively the “ New Options ”) that will have an exercise price equal to the fair market value of the Company’s stock on the date of grant (which is the date hereof) in order to provide the Employee with the benefit of owning options that over time may have a greater potential to increase in value, and thus create better performance incentives for the Employee and, as a result, maximize shareholder value, and the Employee wishes to accept such offer;

 

NOW, THEREFORE , in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Employee agree as follows:

 

1.                   Each of the Existing Options is hereby cancelled and disposed of, and the Employee has no rights whatsoever with respect to the Existing Options.

 

2.                   The Company shall grant the Employee the New Options in connection with the execution of this Agreement. The New Options shall be subject to the terms of the Company’s 2010 Equity Incentive Plan and otherwise have the terms set forth in the applicable stock option agreement. Each New Option will be for a number of shares that, when combined with the New Option’s exercise price, will have the same Black-Sholes value as the corresponding Existing Option, as set forth on Schedule A . Each New Option will have the same vesting schedule and expiration date as the corresponding Existing Option.

 

3.                   The Employee acknowledges that he has had the opportunity to consult counsel and tax advisors prior to entering into this Agreement. The Employee acknowledges that he is aware of the Company’s business affairs and financial condition, including the risks related to the Company’s business as set forth in the Company’s filings with the Securities and Exchange Commission on Form 10-Q and Form 10-K, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to enter into this Agreement.

 

4.                   The Employee acknowledges and agrees that this Agreement does not affect the “at-will” nature of his employment with the Company and that his employment with the Company can be terminated by the Employee or the Company at any time, with or without notice, unless provided otherwise pursuant to any employment agreement with the Company.

 

5.                   This Agreement shall be governed by the laws of the State of Delaware, without regard to conflicts of laws principles.

 

6.                   This Agreement may be signed in any number of counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

 

[Signature page follows]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first indicated above.

 

 

  CHAMPIONS ONCOLOGY, INC.  
       
  By: /s/ Joel Ackerman  
  Name: Joel Ackerman  
  Title: Chief Executive Officer  
       
       
  /s/ David Miller  
  David Miller  

 

 
 

 

Schedule A

  

      Existing Options     New Options  
Date     Shares     Exercise Price     Shares     Exercise Price  
  June 11, 2013       75,000     $ 0.47       73,851     $ 0.41  

 

 

Exhibit 10.5

 

Champions Oncology, Inc.

March 16, 2015

 

 

Joel Ackerman

 

Dear Mr. Ackerman:

 

This letter refers to our letter agreement dated November 5, 2013 regarding your employment compensations. The letter states that, for your employment year beginning November 2014 your annual salary of $325,000 will be paid in the form of cash to the extent of $216,000, and the balance will be paid in stock options.

 

We have agreed that for this current employment year your entire annual salary will be paid in options. As stated in the November 5 letter, the Company will determine in good faith the number of shares that will be subject to the options using the Black-Scholes pricing model.

 

Please countersign this letter below to acknowledge our mutual agreement.

 

    CHAMPIONS ONCOLOGY, INC.  
         
         
    By:

/s/ Abba David Poliakoff

 
   

Abba David Poliakoff, Chairman

 
   

of the Compensation Committee

 
         
Agreed and Accepted:        
         
/s/ Joel Ackerman    
Joel Ackerman    

 

 

 

 

Exhibit 10.6

 

Champions Oncology, Inc.

March 16, 2015

 

 

Ronnie Morris, M.D.

 

Dear Dr. Morris:

 

This letter refers to our letter agreement dated November 5, 2013 regarding your employment compensations. The letter states that, for your employment year beginning November 2014 your annual salary of $305,000 will be paid in the form of cash to the extent of $196,000, and the balance will be paid in stock options.

 

We have agreed that for this current employment year your entire annual salary will be paid in options. As stated in the November 5 letter, the Company will determine in good faith the number of shares that will be subject to the options using the Black-Scholes pricing model.

 

Please countersign this letter below to acknowledge our mutual agreement.

 

 

    CHAMPIONS ONCOLOGY, INC.  
         
         
    By:

/s/ Abba David Poliakoff

 
   

Abba David Poliakoff, Chairman

 
   

of the Compensation Committee

 
         
Agreed and Accepted:        
         
/s/ Ronnie Morris    
Ronnie Morris, M.D.