Spero Therapeutics, Inc 8-K, filed Apr 28, 2025
Spero Therapeutics, Inc. (SPRO)
About this 8-K
Spero Therapeutics, Inc filed this 8-K on April 28, 2025, reporting on events of April 22, 2025.
Items reported
- Item 5.02: Director or officer change, or executive pay
- Item 9.01: Financial statements and exhibits
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| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Appointment of Esther Rajavelu as President and Chief Executive Officer and Nomination for Election to the Board of Directors
On April 28, 2025, Spero Therapeutics, Inc. (the “Company”) announced that effective as of May 2, 2025 (the “Effective Date”), Esther Rajavelu will serve as the Company’s President and Chief Executive Officer. Since January 2025, Ms. Rajavelu has been serving as the Company’s Interim President and Chief Executive Officer, in addition to her roles as Chief Financial Officer, Treasurer and Chief Business Officer, which she has held since November 2023. She will continue to serve as the Company’s Chief Financial Officer and Treasurer. In connection with the foregoing, Ms. Rajavelu has also been nominated for election to serve as a member of the Company’s Board of Directors (the “Board”) at the Company’s 2025 annual meeting of stockholders.
Biographical information for Ms. Rajavelu can be found on the Company’s website and under the caption “Management and Corporate Governance – Executive Officers” in the Company’s Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 28, 2025, and is incorporated herein by reference. The Company believes that Ms. Rajavelu is qualified to serve on the Board because of the leadership qualities she has demonstrated during her service in various executive leadership roles at the Company and other biotechnology companies, as well as her extensive experience as an advisor to life science companies and healthcare investors in her prior employment as a senior equities research analyst, investment banker and strategy consultant in the biotechnology sector.
The selection of Ms. Rajavelu to perform the duties of President and Chief Executive Officer and to serve as a member of the Board was not pursuant to any arrangement or understanding between Ms. Rajavelu and any other person. There are no family relationships between Ms. Rajavelu and any director or executive officer of the Company, and there are no transactions between Ms. Rajavelu and the Company that would be required to be reported under Item 404(a) of Regulation S-K.
Employment Agreement with Ms. Rajavelu
In connection with the above, Ms. Rajavelu and the Company entered into an Amended and Restated Employment Agreement dated April 28, 2025 (the “Rajavelu Amended Employment Agreement”). Under the terms of the Rajavelu Amended Employment Agreement, (i) the Company shall pay Ms. Rajavelu an annual base salary of $620,000; (ii) Ms. Rajavelu shall be eligible to receive an annual cash bonus, with the target amount of such annual performance bonus equal to 50% of her base salary in the year to which the annual performance bonus relates; provided that the actual amount of the annual performance bonus may be greater or less than such target amount; and (iii) the Company will award Ms. Rajavelu 185,000 restricted stock units (“RSUs”) under the 2017 Equity Incentive Plan, as amended (the “2017 Plan”); the RSUs are subject to the terms and conditions of the 2017 Plan and an RSU agreement between Ms. Rajavelu and the Company entered into pursuant thereto; and the RSUs shall vest in four equal annual installments beginning on the first anniversary of the Effective Date, except as otherwise provided in the RSU agreement.
The Rajavelu Amended Employment Agreement also provides for the following severance payments upon termination by the Company without Cause (as defined in the Rajavelu Amended Employment Agreement) or by Ms. Rajavelu for Good Reason (as defined in the Rajavelu Amended Employment Agreement): (i) payment of her then-current Base Salary for a period of 12 months following termination; (ii) a pro-rated target bonus for the period during which Ms. Rajavelu was employed in the year of termination; and (iii) continued coverage under the Company’s group health insurance plan until the earlier of 12 months from termination or the date Ms. Rajavelu becomes eligible for medical benefits with another employer. Further, the Rajavelu Amended Employment Agreement provides that upon termination by the Company without Cause or by Ms. Rajavelu for Good Reason within (i) 90 days prior to the earlier to occur of a Change of Control (as defined in the Rajavelu Amended Employment Agreement) or the execution of a definitive agreement, the consummation of which would result in a Change of Control (provided the Change in Control is then consummated) or (ii) one year following a Change of Control, Ms. Rajavelu will be entitled to receive: (i) a lump sum payment equal to 18 months of her then-current base salary plus an amount equal to one-and-one-half times the target amount of her annual performance bonus; (ii) acceleration of all unvested equity awards as of the date of termination; and (iii) continued coverage under the Company’s group health insurance plan until the earlier of 18 months from termination or the date Ms. Rajavelu becomes eligible for medical benefits with another employer. Payment in each case is subject to Ms. Rajavelu’s execution of a release to be provided by the Company following such termination. In addition, if Ms. Rajavelu’s employment terminates as a result of disability or death, she will be entitled to receive a pro-rated target bonus for the period during which she was employed in the year of termination.
The foregoing description of the Rajavelu Amended Employment Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Rajavelu Amended Employment Agreement, which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2025, and the foregoing description is subject in all respects to the actual terms of the Rajavelu Amended Employment Agreement.
Former President and Chief Executive Officer Separates from the Company and Steps down as Member of the Board of Directors
The Company and Satyavrat Shukla have mutually decided to separate, effective May 2, 2025. Pursuant to the terms of the separation agreement, dated April 28, 2025, between the parties (the “Shukla Separation Agreement”), Mr. Shukla is entitled to receive (i) salary continuation in the amount of $615,825, payable as continued salary for 12 months in accordance with the Company’s regular payroll dates, (ii) a cash bonus equal to $307,913 for the year ending December 31, 2025, which will be paid to Mr. Shukla when the Company pays the 2025 annual bonuses to its employees in 2026, but in any event no later than March 15, 2026, (iii) any unpaid portion, as of May 2, 2025, of a retention bonus in the amount of $452,813, representing two-thirds of the retention bonus that was otherwise payable to Mr. Shukla as provided in his Retention Bonus Agreement with the Company dated November 13, 2024, which amount will be paid in a lump sum on the payroll date on which the Company commences payment of the salary continuation, (iv) notice pay in an amount equal to the balance of Mr. Shukla’s 30-day notice period, in lieu of the 30-day notice period provided under Mr. Shukla’s Amended and Restated Employment Agreement, dated as of June 13, 2023, and (v) if Mr. Shukla is eligible for and elects to continue his health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following his separation date, then the Company will continue to pay the Company portion of his monthly premium under COBRA until the earlier of (A) May 31, 2026 and (B) the date when he becomes eligible to receive health insurance coverage in connection with new employment. Pursuant to the terms of the Shukla Separation Agreement, all of Mr. Shukla’s then vested and unexercised options will be exercisable for 90 days in accordance with the terms of such options and the Company’s 2017 Plan, and the Company’s 2019 Inducement Equity Incentive Plan, as amended, as applicable. In addition, Mr. Shukla shall be entitled to indemnification pursuant to the terms of the indemnification agreement, dated December 9, 2020, between the parties.
In addition, Mr. Shukla will step down from the Board of Directors effective May 2, 2025. Such resignation did not relate to any disagreement between Mr. Shukla and the Company relating to the Company’s operations, policies or practices.
The foregoing description of the Shukla Separation Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the full agreement, which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2025, and the foregoing descriptions are subject in all respects to the actual terms of the Shukla Separation Agreement.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| 99.1 | Press Release, dated April 28, 2025 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
SIGNATURE
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: April 28, 2025 | SPERO THERAPEUTICS, INC. | |||||
| By: | /s/ Esther Rajavelu | |||||
| Esther Rajavelu | ||||||
| Interim President and Chief Executive Officer, Chief Financial Officer, Chief Business Officer and Treasurer | ||||||
Exhibit 99.1
Spero Therapeutics Appoints Esther Rajavelu as President and Chief Executive Officer
CAMBRIDGE, Mass., April 28, 2025 — Spero Therapeutics, Inc. (Nasdaq: SPRO), a clinical-stage biopharmaceutical company, focused on identifying and developing novel treatments for rare diseases and multi-drug resistant (MDR) bacterial infections, today announced that Esther Rajavelu will serve as its President and Chief Executive Officer, effective May 2, 2025, and will be nominated for election as a member of the Board of Directors at Spero’s 2025 annual meeting of stockholders. Since January 2025, Ms. Rajavelu has been serving as Spero’s Interim President and Chief Executive Officer, and has served as Chief Financial Officer, Treasurer, and Chief Business Officer since November 2023. She will continue to serve as the Company’s Chief Financial Officer and Treasurer.
“Esther has demonstrated great leadership during her time at Spero, particularly her focus on advancing Spero’s programs and strengthening our partnership with GSK. We look forward to her continued service both as our President and Chief Executive Officer and as a new member of our Board of Directors. Esther’s prior experience in biopharma financing and strategic initiatives will be vital to executing on Spero’s mission, and her judgement and business acumen will be equally important as we manage the Company to deliver value to our shareholders,” stated Frank Thomas, Chairman of the Board of Directors of Spero.
Ms. Rajavelu added, “I am grateful for the confidence the Board and my colleagues at Spero have placed in me. This is an important time at Spero as we prepare for an update on our PIVOT-PO Phase 3 trial for tebipenem HBr this quarter. The tebipenem HBr clinical program is our highest priority, and we remain focused on advancing the program, along with other key activities aimed at delivering value to our shareholders.”
Ms. Rajavelu will succeed Spero’s previous President and Chief Executive Officer, Sath Shukla. Spero and Mr. Shukla have mutually agreed to separate, effective May 2, 2025, and he will concurrently step down from Spero’s Board of Directors. Chairman Thomas stated, “The Board of Directors is grateful to Sath for his contributions to Spero over his many years of services, including bringing forward our partnership with GSK to pursue the approval of tebipenem HBr. We wish Sath every success in his future endeavors.”
About Spero Therapeutics
Spero Therapeutics, headquartered in Cambridge, Massachusetts, is a clinical-stage biopharmaceutical company focused on identifying and developing novel treatments for rare diseases and MDR bacterial infections with high unmet need. For more information, visit www.sperotherapeutics.com.
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including, without limitation, statements regarding the timing, progress and results of Spero’s preclinical studies, clinical trials and research and development programs; Spero’s strategy, goals and anticipated financial performance, milestones, business plans and focus; and Spero’s cash runway. In some cases, forward-looking statements may be identified by terms such as “may,” “will,” “should,” “expect,” “plan,” “aim,” “anticipate,” “could,” “intent,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of these terms or other similar expressions. Any forward-looking statements in this press release are based on management’s current
expectations and beliefs and are subject to a number of important risks, uncertainties and other factors that may cause actual results to differ materially from those indicated by such forward looking statements, including statements related to tebipenem HBr’s future clinical development process, taking into account the effects of possible regulatory delays, slower than anticipated patient enrollment, manufacturing challenges, clinical trial design and clinical outcomes; whether the results of such trials will warrant submission for approval from the U.S. Food and Drug Administration (FDA) or equivalent foreign regulatory agencies; whether the FDA will ultimately approve tebipenem HBr and, if so, the timing of any such approval; whether the FDA will require any additional clinical data or place labeling restrictions on the use of tebipenem HBr that would delay approval and/or reduce the commercial prospects of tebipenem HBr; whether a successful commercial launch can be achieved and market acceptance of tebipenem HBr can be established; whether results obtained in preclinical studies and clinical trials will be indicative of results obtained in future clinical trials; Spero’s reliance on third parties to manufacture, develop, and commercialize its product candidates, if approved, including, in the case of tebipenem HBr, Spero’s reliance on GSK pursuant to the Exclusive License Agreement to develop tebipenem HBr and GSK’s right thereunder to determine, in its sole discretion, whether to continue the PIVOT-PO trial or otherwise further develop tebipenem HBr; Spero’s need for additional funding; the ability to commercialize Spero’s product candidates, if approved; Spero’s ability to retain key personnel; Spero’s leadership transitions; whether Spero’s cash resources will be sufficient to fund its continuing operations for the periods and/or trials anticipated; and other factors discussed in the “Risk Factors” set forth in filings that Spero periodically makes with the SEC. The forward-looking statements included in this press release represent Spero’s views only as of the date hereof and should not be relied upon as representing its views as of any subsequent date. Except as required by law, Spero explicitly disclaims any obligation to update any forward-looking statements.
Investor Relations Contact:
Shai Biran, PhD
Spero Therapeutics
IR@Sperotherapeutics.com
Media Inquiries:
media@sperotherapeutics.com