AVII, it's funny you bring that up, I was just looking at that yesterday -- Feb 1 is the magic date for grants, it's true.
From a governance standpoint, if there really is a deal in the works, scuttling that deal to get one more juicy grant in would be very hard to justify. But these are capitalists, of course. Would they do that? I don't think Thero fits the profile. His predecessor does, however.
A deal wouldn't interfere with bonus determination for the 2018 performance year, but option grants would be off the table if a deal were announced Monday morning. Having said that, there's no way they'd get away with granting options on Feb 1, and then announcing the deal on Groundhog Day.
I'm pretty sure there are pretty huge golden parachute payments due in this case, as usual... here's Thero's terms:
In lieu of the foregoing, if Mr. Thero’s employment is terminated by the Company without cause or he resigns for good reason, in either case, within twenty-four (24) months following a change of control, he will be entitled to severance as follows: continuation of base salary for eighteen (18) months; continuation of group health plan benefits for up to eighteen (18) months to the extent authorized by and consistent with COBRA with the cost of the regular premium for such benefits shared in the same relative proportion by the Company and Mr. Thero as in effect on the date of termination; a lump sum cash payment equal to the full target annual performance bonus for the year during which the termination occurred; and 100% acceleration of vesting on all outstanding equity incentive awards.
This isn't egregious compared to some companies' provisions, but it's pretty solid. Are they pigs enough to keep the trough open for one more option grant? Are they willing to refuse a deal JUST to get one more option grant? It's unfortunately a fair question.
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