LOL!!! OH MY, a whole 1,875 shares of a stock trading under a buck. Quite the huge incentive for the CEO and the CFO, huh? He'd get real rich off that grant, no?
Sorry again, butt you've undermined your intended point. An option grant to a CEO that tiny is itself proof that it was nothng more than a pro forma gesture that in fact proves that the equity portion of his compensation package was valued at virtually nothing - hence his grant was minuscule.
When a company shuts down and the Board wants certain people to hang around for the shutdown, the Board grants them an incentive package so they will stay for the whole process. The annual (and special incentive) comp packages always include a mix of salary, target bonus, and equity. Equity is always included because supposedly it gives management an incentive to work to increase the stock price. And yes, shutdowns almost always give the remaining employees stock options and/or RSUs even though everyone knows they are worthless - the real meat is the salary and the incentive bonuses - a retention bonus and then a finishing (performance) cash bonus. CASH. The options and RSUs almost always wind up totally worthless.
Usually, a CEO/CFO would get 100,000 share options or more PLUS RSUs as the equity package for this type of small public biotech. And that's for stocks that are publicly traded anywhere from $5 to $100 a share. PLUS RSUs (maybe 25,000). Their salary and bonus are "lower" than otherwise because of this equity portion.
In Herb's case, the Board knew the stock was worth sht, so it downsized the equity package to a paltry, minuscule 1,875 share options and most likely loaded up his salary and performance bonus with a lump sum bonus payment upon successful wind down of the bankruptcy and dissolution.
The fact he was only given 1,875 share options is evidence that the stock option value was believed to be of no value, so they just did the minimum to make it look (i.e., pro forma) that Herb had equity skin in the game, when they all knew it was just a farce.
I enjoy watching Stevie Wonders trying to teach photography. This is funnier than an exposition of Stevie Wonder's best photos.
