Blog: VIRACTA THERAPEUTICS, INC. : Change in Directors or Principal Officers, Regulation FD Disclosure, Financial Statements and Exhibits (form 8-K) –

Item 5.02. Departure of Directors or Certain Officers; Election of Directors;

           Appointment of Certain Officers; Compensatory Arrangements of Certain

Succession of Chief Executive Officer and President; Appointment of Director

On September 15, 2022, the Board of Directors (“Board”) of Viracta Therapeutics,
Inc. (the “Company”) appointed Mark Rothera to serve as Chief Executive Officer
(“CEO”) and President of the Company, effective September 19, 2022. In addition,
also on September 15, 2022, the Board, upon recommendation of the Nominating and
Corporate Governance Committee of the Board, appointed Mr. Rothera to serve as a
Class I director of the Company, also effective September 19, 2022, with a term
expiring at the annual meeting of stockholders to be held in 2025. Mr. Rothera
will succeed Ivor Royston, M.D., in the positions of CEO and President, and
Dr. Royston’s tenure as an officer and employee of the Company is ending
effective September 19, 2022. Dr. Royston will continue to serve as a Class III
director of the Company.

Most recently, Mr. Rothera, 60, served as President, Chief Executive Officer and
as a member of the board of directors at Silence Therapeutics plc, a
pharmaceutical company, from September 2020 until February 2022. From August
2017 to March 2020, Mr. Rothera served as President and Chief Executive Officer
and member of the board of Orchard Therapeutics plc, a biotechnology company.
From 2013 to August 2017, Mr. Rothera served as Chief Commercial Officer of PTC
Therapeutics, a biotechnology company. From 2012 to 2013, he served as Global
President of Aegerion Pharmaceuticals Inc., a biotechnology company, and from
2006 to 2012 as Vice President and General Manager for the commercial operations
of Shire Human Genetic Therapies, Inc., a pharmaceutical company, in Europe, the
Middle East and Africa. Mr. Rothera served as Area VP Europe, Middle East and
Africa for Chiron BioPharmaceuticals, a biotechnology company, from 2000 to 2005
and previously held various global strategic and operational marketing and sales
roles with French and U.K. operations of Glaxo Wellcome, a pharmaceutical
company. Mr. Rothera currently sits on the board of GenPharm. Mr. Rothera
received an M.A. in Natural Sciences from Cambridge University, an M.B.A. from
the European Institute for Business Administration (INSEAD) and a Diploma in
Company Direction from Institute of Directors, United Kingdom.

Mark Rothera Compensation Arrangements

Also on September 15, 2022, upon the recommendation of the Compensation
Committee of the Board (the “Compensation Committee”) and the approval of the
Board, the Company entered into an executive compensation agreement with
Mr. Rothera (the “employment agreement”), to be effective on September 19, 2022,
Mr. Rothera’s first day of employment (the “effective date”). Mr. Rothera’s
employment under the employment agreement is at will and may be terminated at
any time by the Company or by Mr. Rothera. Pursuant to the employment agreement,
Mr. Rothera will receive an annual base salary of $580,650 and a discretionary
annual target bonus of up to fifty-five percent (55%) of his annual base salary
(the “target bonus”), based on the achievement of performance objectives to be
determined by the Board or an authorized committee thereof. Under the employment
agreement, for the Company’s 2022 fiscal year, Mr. Rothera is guaranteed to
receive not less than the target bonus, prorated for the portion of the year
that Mr. Rothera is employed by the Company. The employment agreement also
provides for a sign-on bonus of $100,000 (“sign-on bonus”) and reimbursement for
certain travel and other expenses related to his potential relocation to San
Diego, California, subject to full or partial repayment in the event Mr. Rothera
terminates his employment without “good reason” (as defined in the employment
agreement) prior to the second anniversary of the effective date.

Pursuant to the employment agreement, Mr. Rothera will also receive an initial
grant of time-based non-statutory stock options to purchase 1,375,000 shares of
the Company common stock (the “initial option”) with an exercise price per share
equal to the per share fair market value of the Company’s common stock on the
date of grant. The initial option will vest with respect to twenty-five percent
(25%) of the total number of shares granted on the first anniversary of the
Effective Date, and with respect to one-forty-eighth (1/48) of the total number
of shares granted on the last day of each one-month period to Mr. Rothera’s
service thereafter. The initial option will be subject to the terms and
conditions of the Viracta Therapeutics, Inc. 2021 Inducement Equity Incentive

If the Company terminates Mr. Rothera’s employment other than for “cause,” death
or “disability” or Mr. Rothera resigns for “good reason” outside the period
beginning three (3) months prior to a “change in control” (as all such terms are
defined in the employment agreement) and ending twelve (12) months following a
change in control (such period, the “change in control period”), Mr. Rothera
will be entitled to: (i) continued payment of his base salary, in effect
immediately prior to his termination date, for a period of fifteen (15) months;
(ii) reimbursement by the Company for the cost of continuation of health
coverage for each officer and their eligible dependents pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”),
for up to fifteen (15) months; (iii) any actual bonus for the fiscal year
preceding the termination date that have not been paid as of the date of
termination; (iv) the pro-rated target bonus for the fiscal year of the Company
in which the termination date occurs; and (v) the right to exercise his stock
options until the close of business on the earliest of the twelve (12) months
after his termination of employment or the term/expiration date of the stock


If the Company terminates Mr. Rothera’s employment other than for cause, death
or disability, or Mr. Rothera resigns for good reason during the change in
control period, Mr. Rothera will be entitled to: (i) a lump sum payment equal to
eighteen (18) months of base salary in effect immediately prior to Mr. Rothera’s
termination date; (ii) reimbursement by the Company for the cost of premiums for
continued coverage under COBRA for up to eighteen (18) months; (iii) any actual
bonus for the fiscal preceding the termination date that have not been paid as
of the date of termination; (iv) lump sum payment of one hundred and fifty
percent (150%) of the target bonus for the fiscal year of the Company in which
the termination date occurs; and (v) acceleration of the unvested portion of any
service-vesting stock option or other equity awards held by Mr. Rothera
immediately prior to termination (with any performance-based vesting assumed at
target performance).

If Mr. Rothera’s employment with the Company terminates due to Mr. Rothera’s
death or disability, Mr. Rothera or his estate will receive a payment equal to
the target bonus in the year of termination, pro-rated to reflect the number of
days in the fiscal year of termination that he provided service, and Mr. Rothera
will be eligible for the separation equity rights described above with respect
to a termination within or outside of the change in control period, as

The foregoing benefits are conditioned upon Mr. Rothera signing and not revoking
a release of claims within 60 days following his employment termination date and
his continuing compliance with the terms of a confidentiality and information
agreement, which includes (i) a twelve (12) month non-competition provision
applicable to him, (ii) a twelve (12) month non-solicitation provision
applicable to him, and (iii) a mutual non-disparagement provision.

If any of the payments provided for under the employment agreement or otherwise
payable to Mr. Rothera would constitute “parachute payments” within the meaning
of Section 280G of the Internal Revenue Code and would be subject to the related
excise tax under Section 4999 of the Internal Revenue Code, then he will be
entitled to receive either full payment of benefits or such lesser amount that
would result in no portion of the benefits being subject to the excise tax,
whichever results in the greater amount of after tax benefits to the

Mr. Rothera will receive no additional compensation for his service on the

The summary of Mr. Rothera’s executive employment agreement set forth above does
not purport to be complete and is qualified in its entirety by reference to the
full text of the executive employment agreement, which is attached to this
Current Report on Form 8-K as Exhibit 10.1 and incorporated by reference herein.

In addition, the Company has entered into its standard form of indemnification
agreement with Mr. Rothera. The form indemnification agreement was filed with
the Securities and Exchange Commission on December 23, 2004, as Exhibit 10.5 to
the Company’s Registration Statement on Form S-1 and is incorporated herein by
reference. Mr. Rothera has no direct or indirect material interest in any
transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K
promulgated under the Securities Exchange Act of 1934, as amended, nor are any
such transactions currently proposed. There is no arrangement or understanding
between Mr. Rothera or any other person pursuant to which Mr. Rothera was
selected as an officer or director. There are no family relationships between
Mr. Rothera and any of the Company’s directors or executive officers.

Ivor Royston Separation Agreement
. . .

Item 7.01. Regulation FD Disclosure.

On September 19, 2022, the Company issued a press release announcing the
succession and appointments described in this Current Report on Form 8-K. A copy
of the press release is furnished herewith as Exhibit 99.1.

The information set forth under this Item 7.01, including Exhibit 99.1, shall
not be deemed “filed” for purposes of Section 18 of the Exchange Act, or
incorporated by reference in any filing under the Securities Act of 1933, as
amended, or the Exchange Act, regardless of any general incorporation language
in such filing, unless expressly incorporated by specific reference in such

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Number       Description

10.1           Executive Employment Agreement by and between the Company and Mark
             Rothera, dated September 15, 2022.

10.2           Separation Agreement and Release by and between the Company and Ivor
             Royston, dated September 15, 2022.

99.1           Press Release dated September 19, 2022

104          Cover Page Interactive Data File (embedded within the Inline XBRL


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