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Subsequent Events
12 Months Ended
Dec. 31, 2016
Subsequent Events [Abstract]  
Subsequent Events

15.Subsequent Events

 

On January 6, 2017, the Company announced the appointment of Troy Cox as the new Chief Executive Officer of the Company, effective February 6, 2017 (the “Commencement Date”). Upon the recommendation of the Nominating and Corporate Governance Committee of the Board, the Board was increased in size to 10 directors and elected Mr. Cox to become a member of the Board effective as of the Commencement Date, to serve until the Company’s 2017 annual meeting of stockholders or his earlier death, resignation, retirement or removal. Michael Pellini, M.D. resigned as Chief Executive Officer of the Company, effective as of the Commencement Date. Dr. Pellini will remain a member of the Board and began serving as Chairman of the Board as of the Commencement Date. Alexis Borisy relinquished his position as Chairman of the Board, but will continue to serve on the Board of Directors following the Commencement Date.

On January 5, 2017, the Company and Dr. Pellini entered into a letter agreement (the “Chairman Agreement”), which provides for, among other things, his existing performance-based restricted stock units to continue to vest as long as he serves on the Board. His restricted stock units that are not performance-based will continue to vest until the earlier of the date he no longer serves on the Board and December 31, 2017. Dr. Pellini’s vested stock options will remain exercisable until the later of February 6, 2020 and one year after Dr. Pellini no longer serves on the Board. The resulting changes to Dr. Pellini’s share-based compensation resulted in an immaterial modification expense, which the Company will record in the first quarter of 2017.

In January 2017, the Company began submitting an initial set of claims to Palmetto for FoundationOne test requisitions received in the North Carolina facility. On March 1, 2017, the Company received the first payments for claims under the Palmetto LCD. Payment for all claims processed to date by Palmetto has been made based upon the allowable rate of $3,416 per test.