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Friday, September 14, 2018 8:18:47 AM
Here's what I did find. For simplicity sake I'll use the Dr P facts, but the JH facts are similar (obviously the numbers are smaller).
There's something called the 2016 Equity Incentive Plan that was created upon the arrival of AB which was necessary in order for the company to accommodate the issuance of his incentives.
https://www.sec.gov/Archives/edgar/data/1355250/000147793216011159/ctix_ex102.htm
No specific Award Agreement was filed. What was filed was a Blank FORM OF RESTRICTED STOCK AWARD AGREEMENT.
https://www.sec.gov/Archives/edgar/data/1355250/000147793216011159/ctix_ex106.htm
Since that time AB has received 3 separate issuances, each of which included 1,066,667 shares of restricted stock and a ten-year option to purchase 617,839 shares of the Company’s Class A common stock at an exercise price of $X.XX per share ($1.39, $.705 and $.398 ).
My issue is not with whether those issuances were legally proper or reasonable and appropriate (although there are obvious questions about the latter). It is with the Company's use of the phrase "acceleration as defined in award agreement" and your asserted opinion that "IPIX wanted us to know Dr Bertilino and Ms Harness are being incentivized to complete the deal{s}" and your "IMO" that "the acceleration vesting is most likely the closest option to a cash reward this cash strapped company can offer".
I agree that the company has cash issues but given that these incentives appear to be consistent with, if not identical to, awards granted on the same date in the two previous years it's difficult to connect them to the prospect that the employees are specifically "being incentivized to complete the deal{s}". It would be just as logical to connect them to a desire to make sure they don't fly the coop.
As to the "acceleration as defined in award agreement" I asked for a link to it because I couldn't find one and I don't think that there is one to find, in spite of your assurance that "I am sure the equity incentive/awards plan is outlined in other filings."
What I found (and you posted) was the following language that appears in the reporting of the September 2016 grants:
"Both shares and options shall vest upon the earliest to occur of the following: (1) 50% upon the first anniversary of the effective date, and the remaining 50% upon the second anniversary of the effective date (2) completion of both a Phase 2b psoriasis study and a Phase 2 oral mucositis study; (3) the Company’s common stock closes above $3.00 per share (as may be adjusted for any stock splits or similar actions); (4) the commencement of trading of the Company’s common stock on a national securities exchange (e.g. Nasdaq or the NYSE); or (5) upon a Change in Control (as defined in the employment agreement) of the Company."
The September 2017 grant as reported in the 2018 10-K naturally reflected the deletion of Item #2 given that it was determined that "completion of both a Phase 2b psoriasis study and a Phase 2 oral mucositis study" had already occurred (in spite of the fact that the results are still not in for the psoriasis study). We didn't know what the items were that justified "accelerated vesting" for the 2017 issuances until two days ago.
Now comes the issuances made on September 1, 2018 and AGAIN we don't know what the conditions that would precipitate accelerated vesting are for the NEW grants. That can't be right. No new Form 4s have been filed by the Officers (you seem to have dismissed my request to link those as well).
Finally, this isn't true:
"And, notice the date, September 1 2018. IPIX was not required to release this at this time...but management obviously wanted us to know."
Management was required to report the grants in the Subsequent Event section, just as they did last year. Management wasn't sending a secret message.
"It's about time for you to pick up some cheap shares."
Appreciate the advice but you go right ahead. I think they're cheap for a reason...maybe more than one.
Best to you, too.
But can it core A apple?
Yes Ralph, of course it can core A apple.
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