First, let me say that I greatly respect and appreciate fbg0316's due diligence and the expertise he shares with this board. NOTHING in what I'm about to say should be seen as a personal attack on him.
However, I must again respond to the mistaken point of view, which many on this board have apparently bought into, that Dan's raising of capital, which necessarily dilutes current shareholders, is bad for current shareholders. And, that DOC has somehow given himself or been given equity he does not deserve or has not earned. Both opinions are demonstrably wrong based on the facts of the situation.
Thinking that dilutive capital raises are bad for current shareholders is a mindset that might be appropriate for a large, highly successful company with ongoing revenue and profit. However, that is not the kind of company ADXS is. ADXS is a pre-revenue high-risk START-UP that has been financed publicly rather than through venture capitalists (common in biotech -- not so common in most other industries). ALL pre-revenue start-ups (whether privately or publicly financed) need to be well-capitalized until they are bought out. If they are not well capitalized, money sources will put the "squeeze" on them and refuse to provide funding except at usurious rates. Dilution would then be massive (see what happened to Synthetic Biologics (SYN) recently). Dan has avoided that kind of dilution disaster by constantly raising capital at good prices. Would you prefer he had raised capital at an average of $7/ share rather than $12/ share? Think about it.
The PRIMARY and MOST IMPORTANT job of a pre-revenue start-up CEO, which is what Dan is, is to RAISE CAPITAL. And that means that early shareholders are ALWAYS diluted over time. Ask any venture capitalist in Silicon Valley. Of course, the sooner a company can get to revenue or get bought out, the better (and certainty of the former is required for the latter). While an early investor might have initially bought, say, 10,000 shares at $10 each ($100,000 invested) from a total of 1,000,000 shares initially offered (i.e., 1% of a company valued at $10,000,000), that shareholder will someday (hopefully) have those 10,000 shares of, say, 10,000,000 total shares (i.e., diluted down from 1% to 0.1% -- 10 to 1 dilution) of a company worth $500,000,000...thus, shares would be worth $50 each. Therefore, despite dilution (which is to be fully expected) the original investor would do very well, earning a 5 to 1 return.
This is an example, but exactly the kind of thing that happens to pre-revenue start-ups like ADXS if they are successful. Anyone who has bought ADXS in the last 10 years for $25/sh or less/ share is likely to do very well if ADXS's science is successful because the company would likely be worth ~$6B, which is ~$150/sh given current number of shares outstanding, but even if diluted by another 50% (unlikely), would be worth $75/share. See?
Dilution is ESSENTIAL, but nothing to be feared if the company is successful.
It's a shame some do not seem to understand that the role of the pre-revenue start-up CEO (Dan) is NOT to increase stock price on a regular year-over-year basis. His job is to do two things: (1) first and foremost: raise capital at good (i.e., higher than normal) prices, which Dan has clearly done, and (2) keep product development moving ahead so the products will be hugely successful in the market, which Dan has done.
Now, as for Dan "giving himself" "free" shares. NOTHING COULD BE FURTHER FROM THE TRUTH. On many counts. First, the Board of Directors must approve any proposal for Dan's compensation and share acquisition. And, the ADXS board is controlled by a group of very powerful, experienced shareholders (e.g., Fidelity, Adage, Broadfin, BlackRock).
Second, if you look into the number of restricted shares and stock options Dan has been awarded for successfully raising capital and making product development progress, you will see the amount to be MODEST compared to many pre-revenue start-up CEO's. And, in fact, a significant portion of the shares Dan owns he has himself purchased out of his salary at market prices.
If anyone has not reviewed ADXS's SEC filings that clearly spell out Dan's compensation, I encourage you to do so. I have done that -- and I have provided a lengthy prior post explaining the details: post #13464.
BOTTOM LINE: Dan's cash and equity compensation are WELL WITHIN a reasonable range and are NOT EGREGIOUS either in amount or in how they were obtained...
...fbg0316 argues that Dan somehow "pulled a fast one" on investors early on (2014) by re-shuffling the BOD so he could be awarded 250,000 shares he did not earn. That reading of history is badly flawed in my opinion.
Let me give you a more likely reading of history (since I wasn't on the BOD, I can't say for sure; of course, neither can fbg0316). Dan was brought in by the previous CEO as an EVP of development (i.e., help find funding). He was promoted to CEO by the BOD because the BOD saw him making huge strides to rescue the company from bankruptcy. Dan said to the BOD: "I deserve to be well-rewarded for what I did and what it is now obvious to you all that I can do to make this company successful." The BOD refused Dan's compensation request. Dan then said to the controlling shareholders (Fidelity, Adage, Broadfin, BlackRock): "Either you do this for me or I'm gone." The controlling shareholders got rid of that BOD (or most of them) and brought in BOD members who understood what Dan could do and knew what he was asking for was entirely reasonable -- which it was: just look at the specifics in my post 13464. The major shareholders through the BOD supported Dan's compensation demands. Dan retained. Company saved. Happy times for shareholders.
I may not change some minds because some people here seem to have a deeply-embedded "bug" about Dan's compensation. I can't for the life of me understand why, because everything I know about exec compensation (and I know a fair bit) tells me -- and every single investor in ADXS can check all of this out for themselves in the SEC filings -- that Dan's compensation has ALWAYS been for delivering funding and delivering product development results. It's a GOOD THING the shareholders made changes to the BOD that resulted in DOC being granted 250,000 restricted shares.
We're damn lucky to have Dan O'Connor as CEO. He's been brilliant in his capital raises and in his leadership in driving ADXS's product development forward.
Anyone who does not understand these facts has not done their due diligence or does not understand the requirements for a pre-revenue high-risk start-up company and the compensation required by its CEO.
PLEASE, if you have not done your homework on Dan's compensation and/ or if you do not understand the capital requirements for pre-revenue high-risk start-up companies, STOP the continual drumbeat of "Dan is screwing shareholders." He has not screwed shareholders and is not screwing shareholders. Do you think institutions like Fidelity, Adage, Broadfin, BlackRock would maintain their significant investments if he did screw shareholders or were screwing shareholders?
I pray Dan continues to dilute current shareholders (me!) the way he has been all along: at good prices at the right time. I am HAPPY to pay Dan's compensation, which is by all measures reasonable. I voted "yes" for all the shareholder resolutions.
