I can assure you, HC will jump all over this for you.
The nutshell version (until he gets on line to expound profusely for weeks about it) is that it will add 9.5M shares to our share count once issued. It represents (ballpark, running numbers in head) about 12% or so dilution, which could therefore rightfully/logically knock us back into the low .80's for share price. But this stock doesn't act logically, so who knows...
Among the ways to view this...
Money grab by management? Call them greedy? Well, personally, I don't think the number should be that high; I think less than half would have been more than sufficient reward for their efforts. But it is what it is, and maybe, just maybe, a good chunk of it will be reserved for ALL employees including those yet to be hired. Also, they don't necessarily need to all get issued as shares of stock, so the end result could be less dilution. Certainly a nice perk for an engineer whose input helps launch this missile, if everyone gets something.
Years of complaints that Mr. McNally hasn't bought a substantial number of shares? He probably knew all along that something like this would occur. Buying a few thousand shares out of pocket is completely insignificant compared to what his cut of this will surely be. So is it really greedy? If he pulls this off the way it looks like it will play out, and when added to his annual salary for his job, it would be well below typical compensation for his position as CEO in a medical device company with a highly marketable and highly profitable product such as a surgical robot. Amortized over his years of service, it will probably amount to a fair compensation package, but with the majority of his compensation deferred until program success was assured. This also indicates that program success is pretty much assured, or they wouldn't have done this at this time.
As for timing, I still believe (since the web server came back as is and with no updates, which shows their focus is more on product development than IT or marketing concerns) this is about a 2 year project, similar to the Mazor schedule but probably slightly further advanced than Mazor X was at the time of their initial deal. Our deal really started by late April at the latest, and we are now in late July, so let's call it 21 months to go, maybe less because they REALLY want this.
I think the main takeaway should be that they are confident enough in the end result that they can now go ahead and issue this compensation to themselves.
Okay, HC, now it's your turn to spin the dilution side for the next dozen weeks or so!
Message in reply to:
Can someone please shed some light on the employee stock options that are being issued and how this may relate to a future buyout? Does the timing add to the speculation of something brewing? Thanks.
AI
