001-33291
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33-0830300
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(Commission File Number)
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(IRS Employer Identification No.)
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101 Hudson Street, Suite 3501, Jersey City, NJ 07302
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(Address of principal executive offices, including zip code)
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¨
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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ý
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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¨
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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¨
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 8.01
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Other Events.
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Item 9.01
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Financial Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit No.
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Exhibit
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99.1
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Questions and Answers For U.S. Employees.
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99.2
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Questions and Answers For Canada Employees.
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99.3 | Letter from Michael Bonney To Optimer Employees. |
OPTIMER PHARMACEUTICALS, INC.
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||
Date: July 30, 2013
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By:
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/s/ Stephen W. Webster
Stephen W. Webster
Chief Financial Officer
(Duly Authorized Officer and Principal Financial and Accounting Officer)
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Exhibit No.
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Exhibit
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99.1
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Questions and Answers For U.S. Employees.
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99.2
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Questions and Answers For Canada Employees.
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99.3 | Letter from Michael Bonney To Optimer Employees. |
1.
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What is the Merger and how will the stockholder vote work?
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·
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Optimer has entered into an agreement, the “Merger Agreement,” with Cubist that is intended to result in Cubist acquiring Optimer. We refer to the acquisition as the “Merger,” and we refer to the finalization of the Merger as the “closing” of the Merger.
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·
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The Merger will be subject to the approval of Optimer stockholders holding a majority of the outstanding shares of Optimer stock entitled to vote on the Merger at a special meeting of Optimer stockholders convened for this purpose.
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2.
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Where can I get additional information on the Merger and the stockholder vote?
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·
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Answers to questions on the Merger can be found below under Questions 4 through 8. Additional information can be found in our press release, our Form 8-K filed with the Securities and Exchange Commission on July 30, 2013 and the Proxy Statement that will be filed with the Securities and Exchange Commission in conjunction with a special meeting of Optimer stockholders to vote on and approve the Merger.
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3.
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Why are we doing this deal?
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·
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It’s important for you to know that this decision took a great deal of thought and consideration and, after careful evaluation of Optimer’s multiple alternatives, the Board has determined that this transaction provides the best opportunity to optimize value for our stockholders by delivering an immediate upfront cash payment as well as a meaningful opportunity for additional value tied to the net sales of DIFICID® through the contingent value right.
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4.
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What are the terms of the deal?
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·
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Cubist will pay per share consideration of $10.75 payable in cash at the closing plus one publicly listed, transferable contingent value right, or “CVR” (described below).
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5.
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How will the contingent CVR work?
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·
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Each CVR entitles the holder to receive an additional cash payment of up to $5.00 if certain targets of net sales of DIFICID® between July 1, 2013 and December 31, 2015 in the US and Canada are achieved. The CVR payment is tiered and will be $3.00 if cumulative net sales exceed $250 million, $4.00 if cumulative net sales exceed $275 million and $5.00 if cumulative net sales exceed $300 million. It is expected that the CVRs will be listed on Nasdaq and publicly traded after the closing. The stock market will value the CVR when it begins trading. If the lowest net sales target for DIFICID® is not reached by December 31, 2015, the CVR will expire without value.
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6.
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Is this a done deal? Is there anything that can prevent this from happening?
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·
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Certain conditions must be met in order for the Merger to close. If any of these conditions is not met, including receiving approval from Optimer stockholders at a special meeting to vote on and approve the Merger, as well as receiving governmental agency clearance, the Merger may not take place.
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7.
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What do I have to do to participate in the special meeting to vote on the Merger?
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·
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If you hold shares of Optimer stock on the “record date,” which is a to-be-set date prior to the stockholder vote, you will be mailed a Proxy Statement containing detailed instructions on how to vote your shares. If you purchase shares of Optimer stock after the record date, you will not be able to vote those shares in the stockholder vote on the Merger.
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8.
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When do you expect the Merger to take place?
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·
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We currently expect the Merger to take place later this year, but we cannot predict when all the necessary conditions will be satisfied.
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9.
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Will Optimer conduct a reduction in force or change my job responsibilities before Cubist takes over? What about after the Merger?
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·
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Until the deal closes, we do not expect any changes to day-to-day business operations that are outside the ordinary course of business. Decisions regarding continuing employees will be made by Cubist.
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10.
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If I do lose my job in connection with the Merger, will I be entitled to receive severance benefits?
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·
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The Severance Plan provides severance and other benefits for eligible employees (defined below) who experience a qualifying termination of employment (defined below) that occurs either upon, or within 12 months following, the Merger. The severance eligibility criteria and benefits summarized in this Q&A are subject to the terms and conditions of the Severance Plan, a copy of which is available on Sharepoint.
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·
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Eligible employees include full-time or part-time regular hire employees of Optimer who have been previously notified by Optimer in writing that they are eligible for participation in the Severance Plan.
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·
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For eligible employees, a qualifying termination of employment would occur if your employment is terminated by Optimer without “Cause.” “Cause” is defined in the Severance Plan.
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11.
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If I lose my job after the closing due to a qualifying termination and I meet the eligibility criteria under the Severance Plan, what benefits will I receive?
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·
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There are two plans under which employees may receive benefits in connection with the Merger:
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1.
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Severance Plan:
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(a)
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Eligible employees who lose their jobs in a qualifying termination will receive benefits under the Severance Plan, as summarized in the chart below.
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(b)
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Benefits under the Severance Plan will generally consist of continuation of base salary and group health benefits for a certain period of time following termination based on your position. Depending on your position, you also may receive payment of a percentage of your annual target cash bonus.
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2.
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Incentive Compensation Plan for Non-Sales Personnel: (Please note that there are two Incentive Compensation Plans - one that applies to non-Sales personnel, and one that applies to Sales personnel. You are eligible for participation in only one of these plans.) If the closing occurs in 2013, all non-Sales personnel who are participants in the Incentive Compensation Plan will receive a prorated bonus for 2013 based on months worked, calculated as if all 2013 performance goals had been satisfied at maximum levels for the entire year, regardless of whether they experience a termination of employment. If the closing occurs in 2014, participants will receive a make-up payment of the difference (if any) between the maximum potential bonus for 2013 and the actual bonus paid for 2013. If you are in Sales, you will receive compensation after the closing of the Merger based on the then-current Sales Incentive Compensation Plan.
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·
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In addition, the Merger Agreement provides that all unvested stock options and RSUs will vest and will be paid out in connection with the Merger as described below, regardless of whether you experience a qualifying termination of employment.
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12.
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The table below summarizes the benefits you may be eligible for in connection with the Merger, including:
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·
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benefits under the Severance Plan,
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·
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bonuses under the Incentive Compensation Plan for non-Sales personnel,
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·
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compensation under the Incentive Compensation Plan for Sales personnel,
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·
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payout of accrued vacation under the vacation policy and
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·
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the treatment of your equity awards in connection with the Merger.
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Severance Benefits
(only with qualifying termination of employment)
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Automatic Benefits
(with or without termination of employment)
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|||||
Position
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Base Salary Continuation Period
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Bonus Percentage
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Months of Continued Group Health Benefits
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Payout of Accrued Vacation
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2013 Incentive Compensation
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Equity Cash Out
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Senior Vice Presidents and Vice Presidents
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12 months
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100%
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12 months
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Accrued but unused vacation days will be cashed out (subject to the maximum vacation accrual cap)
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Non-sales: Prorated and paid after the closing of the Merger to all non-Sales Incentive Plan participants
Sales:
Paid after the closing of the Merger based on the then-current IC Plan
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All equity awards, including vested and unvested options and RSUs, will be cashed out at the closing of the Merger (see Questions 20 through 25)
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All Director Levels, Managers, and Non-Managerial Staff with Annual Base Salary in Excess of $100,000
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3 months, plus
2 weeks for each year of service, up to a maximum of 36 weeks
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0%
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Continued during salary
continuation period
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Non-Managerial Staff with Annual Base Salary of $100,000 or Less
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3 months, plus
1 week for each year of service, up to a maximum of 26 weeks
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0%
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Continued during salary continuation period
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13.
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Is my severance payment taxed?
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·
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Yes, all severance and bonus payments are taxed.
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14.
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Will I be required to sign a release?
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·
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Yes, in order to receive benefits under the Severance Plan, you will be required to sign a release agreement, giving up any claims you might have against Optimer. The form will be provided to you by the Severance Plan Administrator. If you do not sign the release, you will not receive severance benefits. The release will include details such as the timeline for its signature and return.
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15.
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When will I receive my benefits?
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·
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After you have signed the release and it becomes effective, base salary continuation payments will be made through regularly scheduled payroll for the duration of the continuation period, and any bonus payment payable to you under the Severance Plan will be made in a lump sum within ten (10) days following the effective date of the release.
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·
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Participants in the non-Sales Incentive Compensation Plan will receive prorated bonus payments in a lump sum within 15 days following the closing of the Merger.
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16.
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How does the health benefits continuation work?
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·
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If you participate in health benefits sponsored by Optimer (for example, medical or dental), you are eligible for post-termination coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (commonly referred to as “COBRA”). Human Resources will send you information on how to elect for coverage under COBRA. It is important to note that you must affirmatively elect COBRA to receive continuation of health benefits.
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·
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If you elect to receive coverage under COBRA, Optimer will pay the full amount of the premiums for you and your eligible dependents during your salary continuation period. If your salary continuation period ends in a partial calendar month, your premium will be paid for that full calendar month. Coverage generally will be at the same level that you participate under at the time of your termination; however, you would be able to change your coverage level in connection with certain life events, such as the subsequent birth of a child, your marriage, or your spouse’s job loss.
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·
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If you do not elect to receive coverage under COBRA, you will not receive any continuation of health benefits under the Severance Plan.
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·
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You may be eligible to continue COBRA after the continuation period, but you will be responsible for the full cost.
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17.
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If Cubist offers me a new position that is contingent upon my relocation, can I be forced to move? If I decline to relocate, will I still receive severance?
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·
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If you are offered a position that would require you to relocate to a location that would materially adversely affect your commute (including, without limitation, a one-way increase in distance of 15 miles or a one-way increase in the time of more than 30 minutes) but you decline it, you will still receive severance benefits as described above.
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18.
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If Cubist offers me a new position that has a lower level of responsibilities and lower compensation but I decline the offer, will I still receive severance?
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·
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If you are offered a new position that does not have substantially the same level of responsibilities and compensation as your current position but you decline it, you will still receive severance benefits as described above.
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19.
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If I am offered a permanent position with Cubist and I accept the position, will I still be paid severance once I cease to be an Optimer employee?
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·
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No, you will not receive severance if you accept a permanent position with Cubist. However, if your employment is subsequently terminated under a qualifying termination within 12 months of the date of the Merger, you will be paid the severance detailed above at the time of termination.
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20.
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What happens to all of my unvested equity awards?
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·
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Please note that in order for your awards to be cashed out you must have accepted your grants in E-trade prior to the closing of the Merger.
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As long as you have accepted your grants in E-trade, all of your unvested equity awards will be cashed out at the closing of the Merger. The following questions provide additional details and examples on the cash out of your awards.
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21.
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What will happen to my stock options?
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·
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Each outstanding stock option, whether vested or unvested, will be cashed out for an amount equal to the excess, if any, of the last public trading price of Optimer Common Stock on Nasdaq before the closing of the Merger, over the exercise price of the option. Option holders will not receive CVRs. However, the last public trading price of Optimer stock will reflect a market valuation of the CVR, and therefore cashing options out at this price serves to compensate option holders for the value of the CVR.
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·
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For example, if you hold a stock option covering 100 Optimer shares with an exercise price of $10.00, and the last public trading price of Optimer Common Stock on Nasdaq before the closing of the Merger is $13.00, you will receive a cash payment of $300 (less tax withholding), calculated as $13.00 minus $10.00, multiplied by 100. But if you hold a stock option covering 100 Optimer shares with an exercise price of $14.00, you will not receive any payment and your options will be cancelled.
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22.
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What will happen to my restricted stock units?
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·
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Each outstanding restricted stock unit, whether vested or unvested, will be cashed out for the same consideration that shareholders generally will receive, that is, $10.75 plus one CVR per share.
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·
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For example, if you hold 100 restricted stock units, you will receive a cash payment of $1,075 (less tax withholding), calculated as $10.75 times 100, plus 100 CVRs.
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·
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If you hold a restricted stock unit award that has performance goals, payment of that award will be calculated based on achievement of the maximum level of performance. If your restricted stock unit award has performance goals tied to 2013 performance, you will still receive payment at maximum levels if the Merger closes in 2014.
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·
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For example, if you hold 100 restricted stock units that would vest at 100% for target performance and up to a maximum of 150% for achievement of higher performance, you will receive a cash payment of $1,612.50 (less tax withholding), calculated as $10.75 times 100 times 150%, plus 150 CVRs.
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23.
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When will I receive payment for my stock options and restricted stock units?
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·
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Holders of stock options and restricted stock units will be paid the cash amount described above (less tax withholding) as soon as reasonably practicable after the closing of the Merger.
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24.
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Can I exercise vested stock options before the closing of the Merger?
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·
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Yes, you can exercise your options for cash, but you may not do a cashless exercise or sell any options when there is a blackout in effect. You will be responsible for the withholding taxes on the in-the-money value at exercise.
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·
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Currently, there is a blackout period in effect and you may not trade until you have been notified by the Insider Trading Compliance Officer that this period has been lifted. Once it is lifted, you may sell shares, subject to Optimer’s insider trading policies and applicable laws and regulations.
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25.
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How will the Merger impact outstanding purchase rights under Optimer’s Employee Stock Purchase Plan (ESPP)?
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·
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The current offering period under the ESPP will continue, but the ESPP will be closed to new participants, and existing participants may not increase their participation level. If the Merger has not closed by November 15, 2013, when the current offering period ends, there will not be a new offering period. Your accumulated payroll deduction for the offering period will be used to purchase shares according to the normal terms of the ESPP, and those shares will be treated the same as all other shares in connection with the Merger.
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·
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The price at which the shares will be purchased will be 15% less than the lower of the trading prices on May 15, 2013 or on the end of the last offering period.
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·
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The ESPP will formally terminate on the closing of the Merger.
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26.
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How will the Merger impact Optimer’s 401(k) Plan?
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·
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The Company will continue to maintain Optimer’s 401(k) Plan until the Merger. However, immediately prior to the closing of the Merger, Optimer’s 401(k) Plan will terminate. You will receive information regarding the options available to you, including how you may choose to receive a distribution of your account balance or to rollover your balance into an eligible retirement plan.
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27.
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How will vacation balances be treated?
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·
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For employees that continue with Cubist after the closing, any outstanding, accrued, but unused vacation days will be carried over to Cubist. Your years of service with Optimer will be recognized under Cubist’s vacation policy. Your years of service also will be recognized by Cubist for purposes of vesting, benefit accrual, sick-time credit and eligibility to participate under the employee benefit plans, programs and policies of Cubist in which you participate after the closing of the Merger.
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·
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For employees that are terminated in connection with the Merger, if you have any outstanding, accrued, but unused vacation days, those days will be paid out upon your termination. Please note that vacation days that exceed the maximum vacation accrual cap are lost and therefore not cashed out. You may check the vacation policy on Sharepoint under the HR tab for more information.
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28.
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If I am terminated following the closing of the transaction, can I file for unemployment compensation even if I am getting severance?
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·
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All employees can file for unemployment compensation upon termination, but the payment of that compensation is generally determined by the state in which you work. Please check with your state unemployment office.
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29.
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Will I be eligible for outplacement services?
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·
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The Severance Plan does not require that outplacement services be provided.
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30.
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What will happen to Optimer’s management team?
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·
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Personnel decisions will be reviewed as part of the integration plan. Until the Merger closes, we will continue to operate as separate companies and proceed in the ordinary course of business.
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31.
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Do you anticipate full integration of systems, processes and resources?
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·
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A joint integration team will be established at the appropriate time to determine how we can maximize operating synergies and implement best practices in all areas of the business.
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32.
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What should I do in the meantime? Should I stop working on the project I am working on?
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·
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During this time, Cubist and Optimer will continue to operate as an independent entity, and we should continue to work hard to reach our corporate goals. Current policies and procedures will remain in place during this time. If you are unsure about anything you should consult with your Supervisor.
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33.
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How will we be organized after the Merger closes?
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·
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Optimer will become a part of Cubist. Decisions regarding the new organization’s structure will be made during the integration process and will be communicated once they are finalized.
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34.
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Why did the Company renew the Co-Promotion Agreement with Cubist?
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·
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The Company has collaborated with Cubist since launch and believes that continuing to operate through this relationship will enable the Company to continue growing DIFICID® over the coming year.
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35.
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Who can I reach out to with questions?
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·
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It is likely that many of you will have similar questions. Please submit questions via e-mail to HR Inbox (hrinbox@optimerpharma.com) so that we may publish your question and the appropriate answer if there are future versions of this Q&A and check Sharepoint often for updates.
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·
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If you have a question that you believe only applies to you, please indicate that in the e-mail with your question.
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·
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Linda Amper is the Company’s Severance Plan Administrator and Meredith Schaum is the Company’s insider trading compliance officer, and you can contact them with questions in those areas. Any questions related to your E-trade account should be directed to E-trade.
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1.
|
What is the Merger and how will the stockholder vote work?
|
|
·
|
Optimer has entered into an agreement, the “Merger Agreement,” with Cubist that is intended to result in Cubist acquiring Optimer. We refer to the acquisition as the “Merger,” and we refer to the finalization of the Merger as the “closing” of the Merger.
|
|
·
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The Merger will be subject to the approval of Optimer stockholders holding a majority of the outstanding shares of Optimer stock entitled to vote on the Merger at a special meeting of Optimer stockholders convened for this purpose.
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2.
|
Where can I get additional information on the Merger and the stockholder vote?
|
|
·
|
Answers to questions on the Merger can be found below under Questions 4 through 8. Additional information can be found in our press release, our Form 8-K filed with the Securities and Exchange Commission on July 30, 2013 and the Proxy Statement that will be filed with the Securities and Exchange Commission in conjunction with a special meeting of Optimer stockholders to vote on and approve the Merger.
|
3.
|
Why are we doing this deal?
|
|
·
|
It’s important for you to know that this decision took a great deal of thought and consideration and, after careful evaluation of Optimer’s multiple alternatives, the Board has determined that this transaction provides the best opportunity to optimize value for our stockholders by delivering an immediate upfront cash payment as well as a meaningful opportunity for additional value tied to the net sales of DIFICID® through the contingent value right.
|
4.
|
What are the terms of the deal?
|
|
·
|
Cubist will pay per share consideration of $10.75 payable in cash at the closing plus one publicly listed, transferable contingent value right, or “CVR” (described below).
|
5.
|
How will the contingent CVR work?
|
|
·
|
Each CVR entitles the holder to receive an additional cash payment of up to $5.00 if certain targets of net sales of DIFICID® between July 1, 2013 and December 31, 2015 in the US and Canada are achieved. The CVR payment is tiered and will be $3.00 if cumulative net sales exceed $250 million, $4.00 if cumulative net sales exceed $275 million and $5.00 if cumulative net sales exceed $300 million. It is expected that the CVRs will be listed on Nasdaq and publicly traded after the closing. The stock market will value the CVR when it begins trading. If the lowest net sales target for DIFICID® is not reached by December 31, 2015, the CVR will expire without value.
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6.
|
Is this a done deal? Is there anything that can prevent this from happening?
|
|
·
|
Certain conditions must be met in order for the Merger to close. If any of these conditions is not met, including receiving approval from Optimer stockholders at a special meeting to vote on and approve the Merger, as well as receiving governmental agency clearance, the Merger may not take place.
|
7.
|
What do I have to do to participate in the special meeting to vote on the Merger?
|
|
·
|
If you hold shares of Optimer stock on the “record date,” which is a to-be-set date prior to the stockholder vote, you will be mailed a Proxy Statement containing detailed instructions on how to vote your shares. If you purchase shares of Optimer stock after the record date, you will not be able to vote those shares in the stockholder vote on the Merger.
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8.
|
When do you expect the Merger to take place?
|
|
·
|
We currently expect the Merger to take place later this year, but we cannot predict when all the necessary conditions will be satisfied.
|
9.
|
Will Optimer conduct a reduction in force or change my job responsibilities before Cubist takes over? What about after the Merger?
|
|
·
|
Until the deal closes, we do not expect any changes to day-to-day business operations that are outside the ordinary course of business. Decisions regarding continuing employees will be made by Cubist.
|
10.
|
If I do lose my job in connection with the Merger, will I be entitled to receive severance benefits?
|
|
·
|
Optimer’s Amended and Restated Severance Benefit Plan (the “Severance Plan”) provides severance and other benefits for eligible employees who experience a qualifying termination of employment(defined below) that occurs either upon, or within 12 months following, the Merger.
|
|
·
|
As stated in the email you received from Paulash Mohsen on June 17, 2013, the Severance Plan does not apply to employees of Optimer Canada. However, in the case of a “Covered Termination”, Optimer Canada will make the same or similar severance benefits available. The Severance Plan is available on Sharepoint.
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|
o
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For eligible employees, a qualifying termination of employment would occur if your employment is terminated by Optimer without “Cause.” All Optimer Canada employees will be treated as if they were eligible employees. “Cause” is defined in the Severance Plan.
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|
·
|
To the extent an eligible employee is entitled to notice of termination or severance benefits under a written employment agreement with Optimer Canada (a “Letter Agreement”), that entitlement will automatically reduce (or if a greater entitlement, eliminate) the severance benefit that otherwise would have been provided under the Severance Plan.
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11.
|
If I lose my job after the closing due to a qualifying termination and I meet the eligibility criteria under the Severance Plan, what benefits will I receive?
|
|
·
|
There are two plans under which employees may receive benefits in connection with the Merger:
|
|
1.
|
Severance Plan:
|
|
(a)
|
Eligible employees who lose their jobs in a qualifying termination will receive benefits equal to the greater of (i) those set out under the Severance Plan as summarized in the chart below, or (ii) the notice/severance benefits set out in your Letter Agreement.
|
|
(b)
|
Severance benefits will generally consist of continuation of base salary and group health benefits for a certain period of time following termination based on your position. Depending on your position, you also may receive payment of a percentage of your annual target cash bonus.
|
|
2.
|
Incentive Compensation Plan for Non-Sales Personnel: (Please note that there are two Incentive Compensation Plans - one that applies to non-Sales personnel, and one that applies to Sales personnel. You are eligible for participation in only one of these plans.) If the closing occurs in 2013, all non-Sales personnel who are participants in the Incentive Compensation Plan will receive a prorated bonus for 2013 based on months worked, calculated as if all 2013 performance goals had been satisfied at maximum levels for the entire year, regardless of whether they experience a termination of employment. If the closing occurs in 2014, participants will receive a make-up payment of the difference (if any) between the maximum potential bonus for 2013 and the actual bonus paid for 2013. If you are in Sales, you will receive compensation after the closing of the Merger based on the then-current Sales Incentive Compensation Plan.
|
|
·
|
In addition, the Merger Agreement provides that all unvested stock options and RSUs will vest and will be paid out in connection with the Merger as described below, regardless of whether you experience a qualifying termination of employment.
|
12.
|
The table below summarizes the benefits you may be eligible for in connection with the Merger, including:
|
|
·
|
benefits comparable to those under the Severance Plan, if greater than those in your Letter Agreement,
|
|
·
|
bonuses under the Incentive Compensation Plan for non-Sales personnel,
|
|
·
|
compensation under the Incentive Compensation Plan for Sales personnel,
|
|
·
|
payout of accrued vacation under the vacation policy and
|
|
·
|
the treatment of your equity awards in connection with the Merger.
|
Severance Benefits
(only with qualifying termination of employment)
|
Automatic Benefits
(with or without termination of employment)
|
||||
Position
|
Base Salary Continuation Period
|
Bonus Percentage
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Payout of Accrued Vacation
|
2013 Incentive Compensation
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Equity Cash Out
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Senior Vice Presidents and Vice Presidents
|
12 months
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100%
|
Accrued but unused vacation days will be cashed out (subject to the maximum vacation accrual cap)
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Non-sales: Prorated and paid after the closing of the Merger to all non-Sales Incentive Plan participants
Sales:
Paid after the closing of the Merger based on the then-current IC Plan
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All equity awards, including vested and unvested options and RSUs, will be cashed out at the closing of the Merger (see Questions 22 through 27)
|
All Director Levels, Managers, and Non-Managerial Staff with Annual Base Salary in Excess of $100,000
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3 months, plus
2 weeks for each year of service, up to a maximum of 36 weeks
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0%
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|||
Non-Managerial Staff with Annual Base Salary of $100,000 or Less
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3 months, plus
1 week for each year of service, up to a maximum of 26 weeks
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0%
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13.
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Is my severance payment taxed?
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·
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Yes, all severance and bonus payments are taxed.
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14.
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Will I be required to sign a release?
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|
·
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In order to receive severance benefits in excess of your statutory entitlements, you will be required to sign a release agreement, giving up any claims you might have against Optimer Canada and Optimer. The form will be provided to you by Optimer Canada. If you do not sign the release, you will not receive severance benefits except as otherwise required under applicable employment standards legislation. The release will include details such as the timeline for its signature and return.
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15.
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When will I receive my benefits?
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·
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After you have signed the release and it becomes effective, base salary continuation payments will be made through regularly scheduled payroll for the duration of the continuation period, and any bonus payment payable to you will be made in a lump sum within ten (10) days following the effective date of the release.
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|
·
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Participants in the non-Sales Incentive Compensation Plan will receive prorated bonus payments in a lump sum within 15 days following the closing of the Merger.
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16.
|
How does the health benefits continuation work?
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|
·
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Eligibility for the continuation of group health benefits will be governed by your Letter Agreement and applicable employment standards legislation. It will be outlined in a letter provided to you at the time you are notified that you are losing your job.
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17.
|
If Cubist offers me a new position that is contingent upon my relocation, can I be forced to move? If I decline to relocate, will I still receive severance?
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|
·
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If you are offered a position that would require you to relocate to a location that would materially adversely affect your commute (including, without limitation, a one-way increase in distance of 15 miles or a one-way increase in the time of more than 30 minutes) but you decline it, you will still receive severance benefits as described above.
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18.
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If Cubist offers me a new position that has a lower level of responsibilities and lower compensation but I decline the offer, will I still receive severance?
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|
·
|
If you are offered a new position that does not have substantially the same level of responsibilities and compensation as your current position and you decline it, you will still receive severance benefits as described above.
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19.
|
If I am offered a permanent position with Cubist on substantially the same responsibilities and compensation as my current position and I decide not to accept it, will I still be paid severance once I cease to be an Optimer Canada employee?
|
|
·
|
If you fail to accept a position with Cubist on substantially the same level of responsibilities and compensation as your current position, you will not receive severance benefits except as may be required by applicable employment standards legislation.
|
20.
|
If I am offered a permanent position with Cubist and I accept the position, will I still be paid severance once I cease to be an Optimer employee?
|
|
·
|
No, you will not receive severance if you accept a permanent position with Cubist. However, if your employment is subsequently terminated under a qualifying termination within 12 months of the date of the Merger, you will be paid the severance detailed above at the time of termination.
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21.
|
Who administers my severance arrangements?
|
|
·
|
Your severance arrangements will be administered by Optimer Canada and any disputes that may arise will be dealt with by Optimer Canada.
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22.
|
What happens to all of my unvested equity awards?
|
|
·
|
Please note that in order for your awards to be cashed out you must have accepted your grants in E-trade prior to the closing of the Merger.
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|
·
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As long as you have accepted your grants in E-trade, all of your unvested equity awards will be cashed out at the closing of the Merger. The following questions provide additional details and examples on the cash out of your awards.
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23.
|
What will happen to my stock options?
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|
·
|
Each outstanding stock option, whether vested or unvested, will be cashed out for an amount equal to the excess, if any, of the last public trading price of Optimer Common Stock on Nasdaq before the closing of the Merger, over the exercise price of the option. Option holders will not receive CVRs. However, the last public trading price of Optimer stock will reflect a market valuation of the CVR, and therefore cashing options out at this price serves to compensate option holders for the value of the CVR.
|
|
·
|
For example, if you hold a stock option covering 100 Optimer shares with an exercise price of $10.00, and the last public trading price of Optimer Common Stock on Nasdaq before the closing of the Merger is $13.00, you will receive a cash payment of $300 (less tax withholding), calculated as $13.00 minus $10.00, multiplied by 100. But if you hold a stock option covering 100 Optimer shares with an exercise price of $14.00, you will not receive any payment and your options will be cancelled.
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24.
|
What will happen to my restricted stock units?
|
|
·
|
Each outstanding restricted stock unit, whether vested or unvested, will be cashed out for the same consideration that shareholders generally will receive, that is, $10.75 plus one CVR per share.
|
|
·
|
For example, if you hold 100 restricted stock units, you will receive a cash payment of $1,075 (less tax withholding), calculated as $10.75 times 100, plus 100 CVRs.
|
|
·
|
If you hold a restricted stock unit award that has performance goals, payment of that award will be calculated based on achievement of the maximum level of performance. If your restricted stock unit award has performance goals tied to 2013 performance, you will still receive payment at maximum levels if the Merger closes in 2014.
|
|
·
|
For example, if you hold 100 restricted stock units that would vest at 100% for target performance and up to a maximum of 150% for achievement of higher performance, you will receive a cash payment of $1,612.50 (less tax withholding), calculated as $10.75 times 100 times 150%, plus 150 CVRs.
|
25.
|
When will I receive payment for my stock options and restricted stock units?
|
|
·
|
Holders of stock options and restricted stock units will be paid the cash amount described above (less tax withholding) as soon as reasonably practicable after the closing of the Merger.
|
26.
|
Can I exercise vested stock options before the closing of the Merger?
|
|
·
|
Yes, you can exercise your options for cash, but you may not do a cashless exercise or sell any options when there is a blackout is in effect.
|
|
·
|
Currently, there is a blackout period in effect and you may not trade until you have been notified by the Insider Trading Compliance Officer that this period has been lifted. Once it is lifted, you may sell shares, subject to Optimer’s insider trading policies and applicable laws and regulations.
|
27.
|
How will the Merger impact outstanding purchase rights under Optimer’s Employee Stock Purchase Plan (ESPP)?
|
|
·
|
The current offering period under the ESPP will continue, but the ESPP will be closed to new participants, and existing participants may not increase their participation level. If the Merger has not closed by November 15, 2013 when the current offering period ends, there will not be a new offering period. Your accumulated payroll deduction for the offering period will be used to purchase shares according to the normal terms of the ESPP, and those shares will be treated the same as all other shares in connection with the Merger.
|
|
·
|
The price at which the shares will be purchased will be 15% less than the lower of the trading prices on May 15, 2013 or on the end of the last offering period.
|
|
·
|
The ESPP will formally terminate on the closing of the Merger.
|
28.
|
How will vacation balances be treated?
|
|
·
|
For employees that continue with Cubist after the closing, any outstanding, accrued, but unused vacation days will be carried over to Cubist. Your years of service with Optimer Canada will be recognized under Cubist’s vacation policy. Your years of service also will be recognized by Cubist for purposes of vesting, benefit accrual, sick-time credit and eligibility to participate under the employee benefit plans, programs and policies of Cubist in which you participate after the closing of the Merger.
|
|
·
|
For employees that are terminated in connection with the Merger, if you have any outstanding, accrued, but unused vacation days, those days will be paid out upon your termination. Please note that vacation days that exceed the maximum vacation accrual cap are lost and therefore not cashed out. You may check the vacation policy on Sharepoint under the HR tab for more information.
|
29.
|
If I am terminated following the closing of the transaction, can I file for unemployment compensation even if I am getting severance?
|
|
·
|
All employees can file for unemployment compensation upon termination, but the payment of that compensation is generally affected by any severance payments paid to you. Please check with your local Service Canada office.
|
30.
|
Will I be eligible for outplacement services?
|
|
·
|
Neither the Severance Plan nor a Letter Agreement require that outplacement services be provided.
|
31.
|
What will happen to Optimer’s and Optimer Canada’s management teams?
|
|
·
|
Personnel decisions will be reviewed as part of the integration plan. Until the Merger closes, we will continue to operate as separate companies and proceed in the ordinary course of business.
|
32.
|
Do you anticipate full integration of systems, processes and resources?
|
33.
|
What should I do in the meantime? Should I stop working on the project I am working on?
|
|
·
|
During this time, Cubist and Optimer will continue to operate as independent entities, so it is business as usual. Current policies and procedures will remain in place during this time. If you are unsure about anything you should consult with your Supervisor.
|
34.
|
How will we be organized after the Merger closes?
|
|
·
|
Optimer will become a part of Cubist. Decisions regarding the new organization’s structure will be made during the integration process and will be communicated once they are finalized.
|
35.
|
Who can I reach out to with questions?
|
|
·
|
It is likely that many of you will have similar questions. Please submit questions via e-mail to HR Inbox (hrinbox@optimerpharma.com) so that we may publish your question and the appropriate answer if there are future versions of this Q&A and check Sharepoint often for updates.
|
|
·
|
Any question about your severance entitlement should be addressed to Paulash Mohsen at Optimer Canada.
|
|
·
|
If you have a question that you believe only applies to you, please indicate that in the e-mail with your question.
|
|
·
|
Linda Amper is the Company’s Severance Plan Administrator and Meredith Schaum is the Company’s insider trading compliance officer, and you can contact them with questions in those areas. Any questions related to your E-trade account should be directed to E-trade.
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