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): April 16, 2018

 

 

SELLAS Life Sciences Group, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-33958   20-8099512

(State or other jurisdiction of

incorporation or organization)

  (Commission
File Number) 		  (I.R.S. Employer
Identification No.)

315 Madison Avenue, 4th Floor

New York, NY 10017

(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code: (917) 438-4353

 

(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 obligations 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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 

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

Departure of Aleksey Krylov as Interim Chief Financial Officer

On April 16, 2018, Sellas Life Sciences Group, Inc. (the “Registrant”) and Aleksey Krylov mutually agreed that his position as Interim Chief Financial Officer (“CFO”) of the Registrant would cease, effective April 20, 2018. Mr. Krylov agreed to remain with the Registrant until July 15, 2018 as a member of the Registrant’s finance team to assist with the transition of responsibilities to the Registrant’s incoming CFO.

Appointment of Gene Mack as Chief Financial Officer

Effective April 20, 2018, the Registrant appointed Gene Mack, age 44, as Chief Financial Officer and Treasurer of the Registrant. From June 2015 until April 2018, Mr. Mack served as a consultant to Nicox S.A. and Ascendia Pharmaceuticals, providing chief financial officer, business development and strategic advising services. From December 2013 to April 2015, Mr. Mack was Senior Director, Business Development and Corporate Finance, at Edge Therapeutics, Inc. From 2000 to 2012, Mr. Mack was a senior biotech analyst at a number of different institutions including Lazard, HSBC and Gruntal & Co.

Pursuant to a letter agreement that governs Mr. Mack’s employment with the Registrant, Mr. Mack is entitled to an annual base salary of $335,000 (subject to review and adjustment in the discretion of the board of directors or its compensation committee) and a discretionary annual cash bonus, with a target amount of up to 40% of Mr. Mack’s then-effective base salary (subject to continued employment and the achievement of certain performance objectives established by the Registrant’s board of directors or compensation committee). The employment letter agreement also provides that Mr. Mack is eligible to participate in any employee benefit plans of the Registrant of general applicability to other employees of the Registrant including, without limitation, group medical, dental, vision, disability, life insurance, and flexible spending account plans.

In connection with Mr. Mack entering into his employment letter agreement, and pursuant to the terms thereof, the Registrant granted to Mr. Mack incentive stock options to purchase up to 40,000 shares of Registrant’s common stock (the “Option”) pursuant to the Registrant’s 2017 Equity Incentive Plan with an exercise price per share equal to the closing market price of Registrant’s common stock on April 20, 2018, with vesting as follows: the Option will vest as to 25% of the shares subject to the Option on April 20, 2019, and as to 1/48th of the shares subject to the Option monthly thereafter, so that the Option will be fully vested and exercisable four (4) years from the date of grant, subject to Mr. Mack’s continued service with the Registrant through each vesting date.

Mr. Mack’s employment letter agreement does not have a specified term and either party may terminate Mr. Mack’s employment agreement by providing written notice at any time, with or without cause. The Registrant and Mr. Mack have agreed to memorialize the terms and conditions of this employment relationship in a more formal Employment Agreement in the near future, so as to definitively determine rights and obligations related to termination benefits, change of control provisions, and other customary features of executive employment agreements.

The description of Mr. Mack’s employment letter agreement included herein is not complete and is subject to and qualified in its entirety by reference to the employment letter agreement, a copy of which is attached as Exhibit 10.1 hereto and is incorporated herein by reference.

In addition, the Registrant has entered into the Registrant’s form of indemnification agreement with Mr. Mack.

ITEM 9.01. Financial Statements and Exhibits

(d) Exhibits. The following material is filed as an exhibit to this Current Report on Form 8-K:

 

Exhibit

    No.    

  

Description

10.1    Employment Letter Agreement by and between SELLAS Life Sciences Group Inc. and Gene Mack, effective April 20, 2018.

SIGNATURES

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

 

    SELLAS Life Sciences Group, Inc.
Dated: April 20, 2018      
    By:  

/s/ Angelos M. Stergiou, M.D., Sc.D.

      Angelos M. Stergiou, M.D., Sc.D.
      President and Chief Executive Officer

Exhibit 10.1

 

LOGO

April 17, 2018

Gene Mack

Dear Gene:

On behalf of SELLAS Life Sciences Group, Inc. (the “Company”) this letter will confirm our offer of employment to join the Company, effective on the following terms:

1.     Employment : You will be employed on a full-time basis as the Company’s Chief Financial Officer and Treasurer, commencing April 20, 2018. You will report to the Company’s Chief Executive Officer (the “CEO”) and have the duties and responsibilities that are consistent with your position and such other duties as may from time to time be assigned to you by the Company.

2.     Annual Base Salary : You will be paid $335,000.00 per annum, payable in accordance with the Company’s payroll schedule (the “Base Salary”). In accordance with normal policy, your Base Salary shall be reviewed by the Compensation Committee of the Company’s Board of Directors (the “Board”) on an annual basis.

3.     Short-Term Incentive Compensation : On an annual basis and subject to approval of the Board, you shall be entitled to annual short-term incentive compensation at a target level of up to 40% of your Base Salary. The actual amount of such annual incentive compensation shall be determined in accordance with the applicable plans based on achievement of individual and Company performance objectives established in advance by the Board or the Board’s Compensation Committee, taking into account input from the CEO, and such actual annual short term incentive compensation amount may be more or less than the target amount. No minimum incentive is guaranteed. Company currently anticipates that the next review of your incentive compensation will occur on or before March 15 th of the following year. The Annual Bonus is earned upon payment.

4.     Equity . On your first day of employment (the “Grant Date”), you will be granted an option to purchase 40,000 shares of the Company’s common stock (“Common Stock”) at an exercise price per share of Common Stock equal to the closing price of the Common Stock on Nasdaq on the Grant Date (the “Option”). To the extent it so qualifies, the Option will be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) and any regulations promulgated thereunder. Subject to any accelerated vesting provisions subsequently agreed to by the Company and you, the Option will vest as to 25% of the shares subject to the Option one year after the date of grant, and as to 1/48th of the shares subject to the Option monthly thereafter, so that the Option will be fully vested and exercisable four (4) years from the date of grant, subject to your Continuous Service Status (as

 

 

SELLAS ™ Life Sciences Group, Inc., 315 Madison Avenue, 4 th Floor, New York, New York 10017, USA

Nasdaq: SLS

www.sellaslifesciences.com

LOGO

 

defined in the Plan) to the Company through the relevant vesting dates. The Option will be subject to the terms, definitions and provisions of the Company’s 2017 Stock Plan (the “Option Plan”) and the stock option agreement by and between you and the Company (the “Option Agreement”), both of which documents are incorporated herein by reference.

5.     Employee Benefits . You will be eligible to participate in the Company’s employee benefits programs at the same level as provided to other senior executive level employees of Company, including, without limitation, the Company’s group medical, dental, vision, disability, life insurance, and flexible-spending account plans. You will be eligible for fifteen (15) days paid time off (vacation). In addition, you shall be entitled to up to four (4) “Personal Days/Floating Holiday” benefits and five (5) sick days. The Company will establish an annual list of U.S Federal holidays observed each year as well.

Vacation days, sick days and floating holidays may be used during the calendar year in which they are earned and accrued, and all earned and accrued sick days and floating holidays that are not used within the calendar year in which they are earned and accrued will be forfeited without compensation, unless applicable federal, state or local law requires otherwise. Accrued but unused vacation days, sick days and floating holidays are forfeited upon termination from employment, except as prohibited by law. Except as set forth in this offer letter, all vacation days, sick days and floating holidays shall accrue and be used and compensated in accordance with the Company’s paid time off policy(ies) as in effect from time to time, unless applicable federal, state, or local law requires otherwise.

6.     Business Expenses . While you are employed by the Company, the Company will reimburse you for reasonable business travel, entertainment or other business expenses (including bar membership fees and professional association dues) incurred by you in the furtherance of or in connection with the performance of your duties hereunder, in accordance with the Company’s expense reimbursement policy as in effect from time to time.

7.     Employment Agreement . Promptly following the Effective Date, you and the Company will negotiate in good faith a written employment agreement containing the preceding provisions and additional terms including but not limited to: (i) termination upon death or disability, (ii) involuntary termination for cause and resignation without good reason, (iii) involuntary termination without cause and resignation for good reason, (iv) effects of a change of control, (v) tax provisions, including without limitation, under Sections 409A and 280G of the Internal Revenue Code of 1986, or any successor provisions, and (vi) and other mutually-agreeable customary employment terms. Any such provisions shall be consistent with like terms provided to other senior executives.

8.     Proprietary Information and Inventions . You acknowledge and agree that upon commencement of your employment with the Compan, you will sign and be bound by the terms of an Employee Confidential Information and Invention Assignment Agreement, including the provisions governing the non-disclosure of confidential information and restrictive covenants contained therein.

 

 

SELLAS ™ Life Sciences Group, Inc., 315 Madison Avenue, 4 th Floor, New York, New York 10017, USA

Nasdaq: SLS

www.sellaslifesciences.com

LOGO

 

9.     No Conflict. You represent that you are not bound by any employment contract, restrictive covenant or other restriction preventing you from entering into employment with or carrying out your responsibilities for the Company, or which is in any way inconsistent with the terms of this offer letter.

10.     At-Will Employment . This offer letter shall not be construed as an agreement, either express or implied, to employ you for any stated term, and shall in no way alter the Company’s policy of employment at-will, under which both the Company and you remain free to end the employment relationship for any reason, at any time, with or without cause or notice. Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at-will” nature of your employment may only be changed by a written agreement signed by you and the CEO that expressly states the intention to modify the at-will nature of your employment. Similarly, nothing in this letter shall be construed as an agreement, either express or implied, to pay you any compensation or grant you any benefit beyond the end of your employment with the Company. This letter supersedes all prior understandings, whether written or oral, relating to the terms of your employment.

We are extremely pleased to have an individual of your background and experience join the Company and look forward to a long and successful business relationship. Please acknowledge your acceptance of these terms at your earliest convenience. Please keep one copy of this letter for your files and return the original as soon as possible.

 

/s/ Angelos M. Stergiou

Angelos M. Stergiou, MD, ScD, h.c.
President and CEO
Acknowledged and Agreed:

/s/ Gene Mack

Gene Mack

 

 

SELLAS ™ Life Sciences Group, Inc., 315 Madison Avenue, 4 th Floor, New York, New York 10017, USA

Nasdaq: SLS

www.sellaslifesciences.com