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): August 6, 2014
CEL-SCI CORPORATION
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(Exact name of Registrant as specified in its charter)
Colorado 001-11889 84-0916344
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(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
8229 Boone Boulevard, Suite 802
Vienna, Virginia 22182
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(Address of principal executive offices, including Zip Code)
Registrant's telephone number, including area code: (703) 506-9460
N/A
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(Former name or former address if changed since last report)
Item 3.02. Unregistered Sales of Equity Securities.
See Item 5.02 below.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Stock Awards
On July 22, 2014 the Company's shareholders approved the Company's 2014
Incentive Stock Bonus Plan. On August 6, 2014 the Company's board of directors
granted stock awards ("Awarded Shares") pursuant to the 2014 Plan to the persons
and in the amounts shown below.
Grantee Awarded Shares (1)
Geert Kersten 5,800,000
Eyal Talor 3,100,000
Patricia Prichep 3,100,000
John Cipriano 1,600,000
(1) The Awarded Shares (or a portion of the shares) will only be earned based
upon the achievement of certain significant milestones leading to the
commercialization of the Company's Multikine technology or significant increases
in the market price of the Company's common shares.
Upon the achievement of the following performance goals, a percentage of
the Awarded Shares will be earned by the Grantees and will no longer be subject
to being forfeited to the Company.
i. Upon either (a) the enrollment of 350 patients in the Phase 3 head
and neck cancer study or (b) the closing price of a share of
Company's common stock on the primary exchange on which such common
stock is then traded exceeds $3.50 for ten consecutive trading days,
each Grantee shall earn 25% of the Awarded Shares.
ii. Upon either (a) the full enrollment of patients in the Phase 3 head
and neck cancer study or (b) the start of a pivotal clinical trial
for Multikine (Leukocyte Interleukin, Injection) (the "Proprietary
Technology") in a disease indication other than head and neck cancer
or (c) the closing price of a share of Company common stock on the
primary exchange on which the common stock is then traded exceeds
$6.00 for ten consecutive trading days, each Grantee will earn 50% of
the Awarded Shares, less any of the Awarded Shares previously earned.
iii. Upon either (a) the end of the Phase 3 head and neck cancer study or
any other pivotal study involving the Proprietary Technology, or (b)
the closing price of a share of Company common stock on the primary
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exchange on which the common stock is then traded exceeds $9.00 for
ten consecutive trading days, each Grantee will earn 75% of the
Awarded Shares, less any of the Awarded Shares previously earned.
iv. Upon either (a) the filing of the first marketing application for
any pharmaceutical based upon the Proprietary Technology in any of
the USA, Canada, UK, Germany, France, Italy, Spain, Japan, or
Australia, or (b) the closing price of a share of Company common
stock on the primary exchange on which the common stock is then
traded exceeds $12.00 for ten consecutive trading days, each Grantee
will earn 100% of the Awarded Shares, less any of the Awarded Shares
previously earned.
The stock price per share will be proportionately adjusted in the event of
any stock splits, stock dividends; recapitalizations or similar events.
The Grantees may not sell, convey, transfer, pledge, encumber or otherwise
dispose of the Awarded Shares until the shares are earned.
If the Grantee has not earned any part of the Awarded Shares as of August
6, 2017, all Awarded Shares will be forfeited and returned to the Company.
The Grantees will forfeit and return to the Company all Awarded Shares that
have not been earned as of August 6, 2024.
Notwithstanding the above, upon the occurrence of a Level One Change in
Control, all Awarded Shares which have not previously been earned will vest and
all restrictions pertaining to the Awarded Shares (other than as may be provided
by applicable securities laws) which have not previously been earned will lapse.
Upon the occurrence of a Level Two Change in Control, if during the period
commencing on the date that is 12 months prior to the occurrence of the Level
Two Change in Control and ending on the date that is 48 months following the
Level Two Change in Control, the Grantee's employment with the Company is
terminated, other than for Cause, or the Grantee terminates his employment on
account of Good Reason, all Awarded Shares will vest and all restrictions
pertaining to the Awarded Shares (other than as may be provided by applicable
securities laws) will lapse.
(i) A Level One Change in Control will occur upon (a) the acquisition by
any individual, entity or group of beneficial owners (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission)
of 50% or more of either (1) the then outstanding shares of the
common stock of the Company, or (2) the combined voting power of
the then outstanding voting securities of the Company entitled
to vote in the election of directors or (b) a majority of the Board
consisting of persons who were not nominated or appointed in the
first instance by the Board.
(ii) A Level Two Change in Control will occur upon acquisition by any
individual, entity or group of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission) of
20% or more of either (1) the then outstanding shares of the common
stock of the Company or (2) the combined voting power of the then
outstanding voting securities of the Company entitled to vote in the
election of directors.
(iii) Cause means (a) conviction of, or pleas of nolo contendere, by the
Grantee for a felony or dishonesty while performing his employment
duties, (b) a Grantee's violation of any non-competition,
non-solicitation, confidentiality or other restrictive covenant
agreement applicable to the Grantee or (c) the Grantee's continued
failure to materially carry out his duties as an employee which
failure has not been cured within 30 days after the Grantee receives
written notice of such failure.
(iv) Good Reason means (a) a reduction in compensation (including
benefits) of the Grantee or (b) the Grantee being assigned any duties
which are materially inconsistent with the duties of the Grantee
immediately prior to the occurrence of the Level Two Change in
Control or (c) the office at which the Grantee performs his duties is
more than 10 miles from the office at which the Grantee performed his
duties immediately prior to the occurrence of the Level Two Change in
Control.
The Company relied upon the exemption provided by Section 4(2) of the
Securities Act of 1933 with respect to the issuance of the shares described
above. The persons who acquired these securities were sophisticated investors
and were provided full information regarding the Company's business and
operations. There was no general solicitation in connection with the offer or
sale of these securities. The persons who acquired these securities acquired
them for their own accounts. The certificates representing the shares of common
stock will bear a restricted legend providing that they cannot be sold except
pursuant to an effective registration statement or an exemption from
registration. No commission or other form of remuneration was given to any
person in connection with the issuance of these securities.
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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.
Date: August 7, 2014 CEL-SCI CORPORATION
By:/s/ Patricia B. Prichep
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Patricia B. Prichep
Senior Vice President of Operations