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 the earliest event reported): May 20, 2008
Valeant Pharmaceuticals International
(Exact name of registrant as specified in its charter)
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Delaware
(State or other jurisdiction of
incorporation or organization)
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1-11397
(Commission File Number)
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33-0628076
(I.R.S Employer
Identification No.) |
One Enterprise
Aliso Viejo, California 92656
(Address of principal executive offices) (Zip Code)
(949) 461-6000
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
TABLE OF CONTENTS
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensation Arrangements of Certain Officers.
AMENDMENT OF 2006 EQUITY INCENTIVE PLAN
On May 20, 2008, at the 2008 Annual Meeting of Stockholders of Valeant Pharmaceuticals
International (the Company, or Valeant), the Companys stockholders approved an amendment to the Companys
2006 Equity Incentive Plan (the Plan) to increase the number of shares of common stock available
for issuance under the Plan by 4,840,000 shares (the Plan Amendment). The Companys Board of
Directors had approved the Plan Amendment on March 26, 2008, subject to stockholder approval.
A copy of the Companys 2006 Equity Incentive Plan, as amended by the Plan Amendment, is included
as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
EXECUTIVE INCENTIVE PLAN
On May 20, 2008, the Compensation Committee (the Committee) of the Board of
Directors of the Company approved the performance bonus program for fiscal year 2008 under the Companys
Executive Incentive Plan.
The Executive Incentive Plan is aimed at recognizing and rewarding the Executives
who significantly influence the strategy, direction and performance of the Company.
Valeants Executive Incentive Plan is built upon the strategic plan of
the Company:
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It is designed to recognize and reward contributions to Valeants success. |
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It provides our Executives with a powerful incentive to achieve strategic
goals. |
Each bonus award depends on the Executives base salary and grade level, on how well
the Company succeeds in meeting certain strategic goals.
Plan Overview
The Executive Incentive Plan includes only participants in the Companys Executive Management
Team. An Executive must be hired before October 1 of the plan year to be eligible
for the current years award and must be an employee on the day the award is paid.
The Executive must also have a minimum of meets expectations on his or her annual
performance appraisal. Eligibility to participate in one year does not guarantee
eligibility in succeeding years.
Participation in the Executive Incentive Plan precludes participation in any other
annual incentive plan, sales compensation plan, or special retention program unless
specifically approved by the CEO of Valeant.
The Compensation Committee of the Board of Directors has approved Valeants
performance goals for this year based on initiatives of the Company to focus the business, maximize the Companys pipeline and restructure
the Companys internal organization.
On an exception basis, once the formula award has been
calculated, the CEO may recommend to the Compensation Committee an increase (or
decrease) of an Executives award up to 25% of the target award to recognize special
circumstances. In making such a recommendation, the CEO shall present to the
Compensation Committee information regarding such factors as overall company
performance, factors beyond the control of the Plan participant, and facts and
circumstances which were not, and could have not been, anticipated by the Executive.
Such recommendation shall only be implemented upon the further recommendation to, an
approval of, the Board of Directors. A Discretionary Adjustment is not normal and
will be made only as a true exception.
How Awards are Determined
The objective of all Executives is to deliver consistent shareholder value. As a
result, the Board of Directors reserves the right to terminate the Companys
Executive Incentive Plan based on financial performance of Valeant or significant
diminution in the Companys stock price as determined by the Board of Directors of
Valeant.
Incentive payments will not be made to participants of a division, unit or function
that fails to meet Sarbanes Oxley Section 404 standards.
The Board of Directors, upon recommendation of the Compensation Committee, may
adjust the bonus of any one or more of the Executives downward by a maximum of 25%,
for extraordinary
circumstances.
Payout of Awards
Payments are made in cash (paycheck), in local currency, within 2-1/2 months
following the end of the fiscal year, but not before the release of year-end
results. An Executives award is subject to applicable withholdings.
Changes in an Executives Employment Status
If an Executive Leaves the Company If an Executive leaves Valeant during the
year, eligibility for the Executives award will depend on the reason the Executive
is leaving.
Death, Disability, or Retirement The Executives award will be pro-rated based on
the number of full months the Executive has been employed during the year. The
pro-rated award will be paid at the time Incentive Plan payments are made to all
participants.
Other Reasons If the Executive resigns or is terminated before the awards are
paid, the Executive forfeits his or her award.
EMPLOYMENT ARRANGEMENTS WITH MR. PEARSON
As previously reported, the Company entered into an employment agreement with Mr. J. Michael
Pearson (the Employment Agreement), effective as of February 1, 2008, with respect to his
employment as Chief Executive Officer and election to the Board of Directors as a director and
Chairman.
Under the Employment Agreement, Mr. Pearsons annual bonus for 2008 was guaranteed to be a minimum
of $1,000,000. Mr. Pearson has agreed with the Company to waive the guarantee of his 2008 bonus
and the amount of any such bonus will instead be determined by the Compensation Committee of the
Board of Directors based on its evaluation of Mr. Pearsons performance of his strategic
initiatives.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
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Exhibit Number |
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Description |
10.1
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Valeant Pharmaceuticals International 2006 Equity Incentive
Plan, as amended (previously filed as Annex E to the
Companys Definitive Proxy Statement on Schedule 14A filed
with the Securities and Exchange Commission on April 4,
2008 and incorporated herein by reference). |