Form 8-K DURECT CORP For: Jul 05

 

 

Exhibit 10.1

 

 

June 17, 2022

 

Timothy M. Papp

[PERSONAL CONTACT INFORMATION REDACTED]

[PERSONAL CONTACT INFORMATION REDACTED]

 

Via electronic delivery

 

Dear Timothy:

 

It is a pleasure to confirm the offer extended to you to join DURECT Corporation, located at 10260 Bubb Road, Cupertino, California, 95014, as Chief Financial Officer, reporting directly to me.  We would like your start date to be July 1, 2022, but will depend on when you successfully complete a pre-employment drug screening and background verification.  As an exempt, regular employee, your starting semi-monthly salary will be $17,291.67, which equates to $415,000.00 on an annual basis. In addition, in connection with your commencement of employment, you will be granted an option to purchase 600,000 shares of DURECT Common Stock.  The vesting associated with the option is as follows: Stock options shall vest as to one-fourth (1/4) of the total shares subject to the option on the one-year anniversary of the date of grant and as to one-sixteenth (1/16) of the total shares subject to the option at the end of each three-month period following the one-year anniversary of the grant.  The per share exercise price for the option will be the fair market value of DURECT Corporation’s Common Stock on the date of the grant of the option. You will be eligible for annual equity grants commensurate with your position as Chief Financial Officer beginning calendar year 2023.

 

You will be eligible for an annual bonus consistent with the other officers of the Company, which in your case is currently a target of 40% of your annual base salary, with a breakdown of 95% based on the Company’s performance as a whole against the corporate objectives and 5% from performance against personal objectives. This bonus will be subject to proration based on your start date. The board of directors retains the discretion to adjust actual bonus payments.

 

In addition, your option awards will be subject to the terms of the Company’s change of control policy, which provides for certain vesting and severance benefits for Vice Presidents and above in the event of a qualifying termination of employment in connection with or within twenty-four months following a change in control.

 

Benefits

Effective the first of the month following your start date, you will be eligible to participate in the benefits enjoyed by an indefinite term employee, including medical, dental, vision, life and disability insurances.  You will be eligible for paid holidays, vacation accrual, and sick leave.  You may elect to participate in the 401(k) savings plan, the Employee Stock Purchase Plan, and a Section 125 Cafeteria Plan according to the terms and conditions governing participation in the plans.  If the terms and conditions governing any such benefit plan differ from any provision of this letter, the plan documents containing these terms and

DURECT Corporation | 10260 Bubb Road | Cupertino, CA 95014 | 408.777.1417

 

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conditions will govern and take precedence. The Company agrees to pay your reasonable legal expenses incurred in the negotiation of this agreement.

 

This offer is contingent upon successful completion of a background investigation and pre-employment drug screening test due to the fact that DURECT is engaged in the development and manufacture of pharmaceutical products, including controlled substances.  Your representing agency, Spencer Stuart, will conduct your background investigation.  As for your pre-employment drug screening test, you will be notified by Justifacts Credential Verification, Inc. and given instruction on how to complete the drug check verification.  This must be completed and returned prior to your start date.  

 

Authorization to Work

Federal regulations require that you establish your identity and authorization to work in this country, so this offer is necessarily contingent upon such proof.  Enclosed is a description of the original documents that are accepted. You will be required to provide them on your first day of work, at which time we or an authorized representative of the Company will meet with you to examine the original documents and ask that you complete the required “INS” form in their presence.

 

Agreements

The enclosed “Confidential Information and Invention Assignment Agreement” must be signed by you before you start your first day of work.  Please retain a copy for your records.

 

Your employment at DURECT is for an unspecified period of time and your relationship with the Company is and shall continue to be at-will, as defined under applicable law, meaning that either you or DURECT may terminate your employment relationship at any time for any reason or no reason, with or without notice.

 

Please indicate that these terms and conditions are acceptable and confirm your acceptance of this offer by signing and dating the original of this letter and returning it by June 21, 2022. You may retain a duplicate for your records.

 

Congratulations on your offer to join DURECT Corporation; we look forward to working with you.  Please do not hesitate to call me directly or Brenna Stauffer, Sr. Manager Human Resources, at (408) 864-7401 if you have any questions.

 

Sincerely,

/s/ James E. Brown, President & CEO

James E. Brown

President and Chief Executive Officer

 

 

JEB/bs

Enclosures

 

Understood and accepted:

 

 

Signature/s/ Timothy M. Papp DateJune 21, 2022

       Timothy Papp

DURECT Corporation | 10260 Bubb Road | Cupertino, CA 95014 | 408.777.1417

 

Exhibit 99.1

DURECT Corporation Appoints Timothy M. Papp as Chief Financial Officer

CUPERTINO, Calif., July 5, 2022 -- DURECT Corporation (Nasdaq: DRRX), a biopharmaceutical company focused on epigenetic regulation to develop treatments for acute organ injury and chronic liver diseases, today announced the appointment of Timothy M. Papp as its Chief Financial Officer. In this new role, Mr. Papp will direct and oversee all financial and capital markets activities including accounting, financial reporting, financial planning and analysis, financial strategy, and investor relations.

"We are excited to welcome Tim to our executive leadership team, as he brings his deep understanding of corporate finance and corporate value drivers to DURECT,” stated James E. Brown, D.V.M., President and Chief Executive Officer of DURECT.

Mr. Papp brings over 25 years of corporate finance experience to DURECT, including 15 years in the Biopharma sector. He joins DURECT from RBC Capital Markets, where he was a Managing Director of Healthcare Investment Banking. Previously, he served as a Managing Director of Healthcare Investment Banking at Stifel, and he also served in Investment Banking and Mergers & Acquisitions roles at Cowen, Keybanc Capital Markets, and Rodman & Renshaw. Mr. Papp graduated cum laude from Duke University with a B.S. in Economics and earned an MBA from The Wharton School of Business with a concentration in Finance.

 

Mr. Papp commented, "I believe that larsucosterol is an underappreciated asset that has the potential to transform the treatment of alcohol-associated hepatitis as well as other indications. I am excited to join the DURECT team at this important juncture of its corporate development.”

About DURECT Corporation

DURECT is a biopharmaceutical company committed to transforming the treatment of acute organ injury and chronic liver diseases by advancing novel and potentially lifesaving therapies based on its endogenous epigenetic regulator program. Larsucosterol (also known as DUR-928), DURECT's lead drug candidate, binds to and inhibits the activity of DNA methyltransferases (DNMTs), epigenetic enzymes which are elevated and associated with hypermethylation found in alcohol-associated hepatitis (AH) patients. Larsucosterol is in clinical development for the potential treatment of AH, for which FDA has granted a Fast Track Designation; non-alcoholic steatohepatitis (NASH) is also being explored. In addition, POSIMIR® (bupivacaine solution) for infiltration use, a non-opioid analgesic utilizing the innovative SABER® platform technology, is FDA-approved and has been exclusively licensed to Innocoll Pharmaceuticals for development and commercialization in the United States. For more information about DURECT, please visit www.durect.com and follow us on Twitter https://twitter.com/DURECTCorp.

 

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DURECT Forward-Looking Statement
This press release contains forward-looking statements that involve substantial risks and uncertainties. Forward-looking statements include, without limitation, statements regarding the clinical development of larsucosterol (DUR-928) for potential treatment of AH, the potential to develop larsucosterol for NASH or other indications, the expected commercial launch of POSIMIR by Innocoll and potential future payments we may receive from Innocoll.  Actual results or events could differ materially from the plans, intentions, expectations and projections disclosed in the forward-looking statements. Various important factors could cause actual results or events to differ materially, including, but not limited to, the risk that the AHFIRM (Alcohol-associated Hepatitis to evaluate saFety and effIcacy of laRsucosterol treatMent) trial takes longer to conduct than anticipated due to COVID-19 or other factors, the risk that ongoing and future clinical trials of larsucosterol do not confirm the results from earlier clinical or pre-clinical trials, or do not demonstrate the safety or efficacy or the life-saving potential of larsucosterol in a statistically significant manner,  the risk that Innocoll may not commercialize POSIMIR successfully, if at all, and risks related to our ability to obtain capital to fund operations and expenses, and other risks described in the “Risk Factors” section of DURECT's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on May 5, 2022,  and in other filings filed from time to time with the SEC. DURECT does not assume any obligation to update any forward-looking statements, except as required by law. The 10-Q and other public filings are available on our website www.durect.com under the "Investors" tab.

NOTE: POSIMIR® is a trademark of Innocoll Pharmaceuticals, Ltd. in the U.S. and a trademark of DURECT Corporation outside of the U.S. SABER® is a trademark of DURECT Corporation. Other referenced trademarks belong to their respective owners. Larsucosterol (DUR-928) is an investigational drug candidate under development and has not been approved for commercialization by the U.S. Food and Drug Administration or other health authorities for any indication.

SOURCE: DURECT Corporation

Investor Relations (DURECT) – Michael Morabito, PhD, Solebury Trout, +1-646-378-2928, [email protected]

Media Contact (DURECT) - Mónica Rouco Molina, PhD, LifeSci Communications, +1-929-469-3850, [email protected]

 

 

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