Item
5.02
|
Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
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Election
of Dr. Shen as Director
On
July 29, 2020, the Board of Directors of PolarityTE, Inc. (the “Company”), elected Jessica Shen, MD, MS, to serve
as a member of the Board of Directors beginning July 29, 2020, for the term expiring at the Company’s 2022 annual meeting
of stockholders and until her successor is duly elected and qualified, or until her earlier death, resignation or removal. Dr.
Shen’s appointment was recommended to the Board by its Nominating and Governance Committee. No determination was made with
respect to Dr. Shen’s service on committees of the Board.
In
accordance with the Company’s compensation program for non-employee directors, Dr. Shen is entitled to receive a $45,000
annual retainer paid quarterly for service as a Board member, which is prorated for the period of actual service during the calendar
year. Dr. Shen will be entitled to additional compensation if she serves on one of the standing committees of the Board. Under
the Company’s compensation plan for non-employee directors, new directors are entitled to receive on-boarding equity
awards with a value of $160,000. Effective July 29, 2020, Dr. Chen was granted under the Company’s 2017 Equity Incentive
Plan equity awards that vest over three years beginning July 29, 2021, subject to continued service to the Company, consisting
of an option to purchase 102,662 shares of the Company’s common stock at an exercise price of $1.57 per share exercisable
over a term of 10 years and 37,838 restricted stock units.
The
Company also entered into the Company’s standard form of indemnification agreement with Dr. Chen. Under the indemnification
agreement, the Company agrees, among other things, to indemnify directors and certain officers under the circumstances and to
the extent provided for therein, to the maximum extent permitted by Delaware law, including indemnification of expenses such as
attorneys’ fees, judgments, penalties, fines and settlement amounts incurred by the director or officer in any claim arising
out of the person’s service to the Company or its subsidiaries. The form of indemnification agreement was previously filed
as Exhibit 10.1 to the Company’s current report on Form 8-K filed with the Securities and Exchange Commission on March 25,
2020 and is incorporated herein by reference.
There
are no arrangements or understandings between Dr. Chen and any other persons pursuant to which she was elected as a director of
the Company. There are no family relationships between Dr. Chen and any director, executive officer, or any person nominated or
chosen by the Company to become a director or executive officer. There are no related person transactions (within the meaning
of Item 404(a) of Regulation S-K promulgated by the Securities and Exchange Commission) between Dr. Chen and the Company.
A
copy of the Company’s press release announcing the election of Dr. Shen is attached hereto as Exhibit 99.1.
Resignation
of Dr. Jon Mogford
On
August 21, 2019, the Company reached a settlement with Dr. Denver Lough resolving Dr. Lough’s status with the Company, which
was reported in the Company’s current report on Form 8-K filed with the Securities and Exchange Commission on August 26,
2019. The terms of the settlement include, among other items, the requirement that Dr. Jon Mogford will agree to resign as a director
on or before July 31, 2020. Pursuant to that term of the settlement Dr. Mogford resigned as a director of the Company on July
29, 2020.