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): July 5, 2005
LIGAND PHARMACEUTICALS INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
000-20720
(Commission File Number)
10275 SCIENCE CENTER DRIVE,
SAN DIEGO, CALIFORNIA
(Address of principal executive offices)
(858) 550-7500
(Registrant's telephone number, including area code)
77-0160744
(I.R.S. Employer Identification No.)
92121-1117
(Zip Code)
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
EXECUTIVE OFFICER COMPENSATION
On July 5, 2005, the Compensation Committee (the "Compensation Committee") of
the Board of Directors of Ligand Pharmaceuticals Incorporated (the "Company")
approved the annual base salaries (effective as of January 1, 2005(1)) of the
Company's executive officers after a review of performance and competitive
market data. The following table sets forth the annual base salary levels of the
Company's executive officers for calendar year 2005(1):
Name and Position Base Salary
David E. Robinson $675,000(1)
Andres F. Negro-Vilar $450,000
James J. L'Italien $276,000
Paul V. Maier $335,000
William A. Pettit $269,000
Warner R. Broaddus $286,000
Eric S. Groves $243,000
Martin D. Meglasson $273,000
Tod G. Mertes $240,000
(1)Mr. Robinson's salary is effective as of May 1, 2005.
Also, on July 5, 2005, the Compensation Committee authorized the payment of
annual incentive (bonus) awards to each of the Company's executive officers for
services during the year ended December 31, 2004. Consistent with past practice,
the Compensation Committee used several factors to set the targets for these
annual incentive awards, principally (1) competitive pay practices, (2) job
duties and responsibility and (3) the Company's need to attract, retain and
reward executive talent. The Compensation Committeee used data obtained by the
Company from external sources that compared and summarized pay practices at
companies that compete with the Company nationally and in its business and
location for executive talent. Actual annual incentive bonus payments were
determined based on the Company's and each executive's performance during 2004
as measured against performance measures established early that year. In
addition, the Compensation Committee evaluated each executive's performance
against individual goals also set early in 2004. The following table sets forth
cash payments to the executive officers in respect of their annual incentive
awards for 2004:
Name 2004 Bonus
Andres F. Negro-Vilar $70,000
Giambattista Aliprandi(2) $48,000
James J. L'Italien $45,000
William A. Pettit $35,000
Warner R. Broaddus $35,000
Eric S. Groves $34,000
Martin D. Meglasson $40,000
Tod G. Mertes $30,000
(2)Mr. Aliprandi retired from the company in April 2005.
Also on July 5, 2005, the Compensation Committee approved grants of ten-year
stock options to each of the executive officers pursuant to the Company's 2002
Stock Incentive Plan. The following table sets forth information regarding
grants of stock options to the executive officers. Each option has an exercise
price of $7.25, the closing price of the Company's common stock on July 5, 2005.
Name Option Shares Granted
David E. Robinson 100,000
Andres F. Negro-Vilar 35,000
James J. L'Italien 10,000
Paul V. Maier 35,000
William A. Pettit 10,000
Warner R. Broaddus 20,000
Martin D. Meglasson 15,000
Tod G. Mertes 15,000
Options vest over four years as follows: 12.5% at six months from the date of
grant, with the remaining 87.5% vesting monthly over the 42 months thereafter,
subject to continuous employment.
AMENDMENT TO NON QUALIFIED DEFERRED COMPENSATION PLAN
The American Jobs Creation Act of 2004 mandated a number of changes to
non-qualified deferred compensation plans by adding new section 409A to the
Internal Revenue Code. The Treasury Department has subsequently issued guidance
under the new section which, in part, allows certain changes to deferral
elections by participants in such plans as transition relief under the new law
(the "Transition Relief"). On July 5, 2004, the Compensation Committee approved
an amendment to the Company's Non-Qualified Deferred Compensation Plan (the
"Plan") to permit certain executive officers to terminate their participation in
the Plan on or before December 31, 2005 pursuant to the Transition Relief. The
text of the amendment is filed as Exhibit 10.1 to this report and is hereby
incorporated by reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.1 Amendment to Non-Qualified Deferred Compensation Plan
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned.
LIGAND PHARMACEUTICALS INCORPORATED
Date : July 11, 2005 By: /S/ WARNER R. BROADDUS
Name: Warner R. Broaddus
Title: Vice President, General Counsel & Secretary