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Post by awesomo on Aug 31, 2020 19:37:30 GMT -5
So yeah, executives were awarded millions of shares. Mike Castagna: 909,000 shares Steven Binder: 364,000 shares David Thompson: 364,000 shares Joseph Kocinsky: 364,000 shares Stuart Tross: 364,000 shares Alejandro Galindro: 364,000 shares Rose Alinaya: 130,000 shares Total: 2,859,000 sharesSEC FormsThe restricted stock unit will vest on May 22, 2023 provided that the closing price of MannKind common stock on such vesting date is not less than the closing price on August 27, 2020. The number of shares delivered on the vesting date, as a percentage of the target specified in Box 4 above, is determined by the percentile ranking of MannKind total shareholder return (TSR) over the period from August 27, 2020 until May 22, 2023 related to the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index over the same period, as follows: less than 25th percentile=0% of target, 25th percentile=50% of target, 50th percentile=100% of target, 75th percentile=200% percent of target, 90th percentile or higher=300% maximum. Payout values will be interpolated between the percentile rankings above. |
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Post by radgray68 on Aug 31, 2020 19:56:17 GMT -5
I'm confused. So, all combined, employees own about 1% of outstanding shares. Is that too much, or too little? To your mind, does that fall into the "Employees getting too many free shares" column? Or, does this fall under the "They got no skin in the game" column?
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Post by mnkdfann on Aug 31, 2020 20:12:00 GMT -5
MC is granted a target of 909k shares, and 300% of that target if the TSR of MNKD hits the 90th percentile of the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index from now until May 22, 2023.
That should be some powerful motivator!
I wonder what sort of return those percentile targets equate to, at least speaking historically.
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Post by neil36 on Aug 31, 2020 21:39:28 GMT -5
MC is granted a target of 909k shares, and 300% of that target if the TSR of MNKD hits the 90th percentile of the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index from now until May 22, 2023. That should be some powerful motivator! I wonder what sort of return those percentile targets equate to, at least speaking historically. So if the index doubled in three years, management would qualify for the 300% share payout if they got they got the MNKD share price to $3.40 (or just a little less than that)? Am I understanding that correctly? |
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Post by mnkdfann on Aug 31, 2020 21:49:20 GMT -5
MC is granted a target of 909k shares, and 300% of that target if the TSR of MNKD hits the 90th percentile of the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index from now until May 22, 2023. That should be some powerful motivator! I wonder what sort of return those percentile targets equate to, at least speaking historically. So if the index doubled in three years, management would qualify for the 300% share payout if they got they got the MNKD share price to $3.40 (or just a little less than that)? Am I understanding that correctly? I think the comparison is the %age increase in MNKD's share price compared to the %age increase in the components of that Russell 3000 P&B index. The index overall might double, but the 90th percentile of components in the index could be up 10 times. To get the 300% in the case above, MNKD would also have to be up 10 times. |
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Post by neil36 on Aug 31, 2020 21:52:34 GMT -5
So if the index doubled in three years, management would qualify for the 300% share payout if they got they got the MNKD share price to $3.40 (or just a little less than that)? Am I understanding that correctly? I think the comparison is the %age increase in MNKD's share price compared to the %age increase in the components of that Russell 3000 P&B index. The index overall might double, but the 90th percentile of components in the index could be up 10 times. To get the 300% in the case above, MNKD would also have to be up 10 times. That seems more logical. Thank you |
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Post by golfeveryday on Aug 31, 2020 21:58:21 GMT -5
I think the comparison is the %age increase in MNKD's share price compared to the %age increase in the components of that Russell 3000 P&B index. The index overall might double, but the 90th percentile of components in the index could be up 10 times. To get the 300% in the case above, MNKD would also have to be up 10 times. That seems more logical. Thank you at the end of the day my assumption is if they hit max payout we are all rich, so bring it on shady Mike. |
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Post by buyitonsale on Sept 1, 2020 0:25:52 GMT -5
I do not see anything in the conditions comparing performance to the components of the index.
It will be compared to TSR of the index.
Castagna will have about 3M shares in 3 years.
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Post by mnkdfann on Sept 1, 2020 0:48:24 GMT -5
I do not see anything in the conditions comparing performance to the components of the index. It will be compared to TSR of the index. Okay, then please explain what the percentiles refer to. Why would percentiles even be mentioned, if it was a straight comparison to the TSR of the index? "The number of shares delivered on the vesting date, as a percentage of the target specified in Box 4 above, is determined by the percentile ranking of MannKind total shareholder return (TSR) over the period from August 27, 2020 until May 22, 2023 related to the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index over the same period, as follows: less than 25th percentile=0% of target, 25th percentile=50% of target, 50th percentile=100% of target, 75th percentile=200% percent of target, 90th percentile or higher=300% maximum. Payout values will be interpolated between the percentile rankings above." |
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Post by matt on Sept 1, 2020 8:08:50 GMT -5
Okay, then please explain what the percentiles refer to. Why would percentiles even be mentioned, if it was a straight comparison to the TSR of the index? This looks fairly straightforward to me. It compares "total shareholder return" which is generally defined as stock price appreciation plus cash dividends (you have to read the fine points of the plan to verify that). If MNKD performs about as well as the firms in the Russell index, the executives will get a 100% payout. While it is fun to talk about the payouts at the 300% level, the fact is that most companies in the Russell that are in the 90% percentile have hit a home run and been acquired at a huge premium by some other company, just like most of the ones in the bottom 25% have suffered multiple business issues (failed clinical trials, product recalls, lawsuits) such that they are nearing bankruptcy or have already gone out of business. Since most small pharmas pay no dividend, share price appreciation is the primary driver of TSR. The plan does not provide a payout based on what MNKD does, it provides a payout based on what MNKD does relative to its peer group. Beat the averages and the payout is bigger, but fail to beat the average and the payout gets smaller. A better question is whether a 100% payout is justified for being average relative to the peer group when the folks that put together the Russell index are picking the components of the index rather than the board itself. |
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Post by mnkdfann on Sept 1, 2020 8:23:01 GMT -5
Okay, then please explain what the percentiles refer to. Why would percentiles even be mentioned, if it was a straight comparison to the TSR of the index? This looks fairly straightforward to me. It compares "total shareholder return" which is generally defined as stock price appreciation plus cash dividends (you have to read the fine points of the plan to verify that). If MNKD performs about as well as the firms in the Russell index, the executives will get a 100% payout. While it is fun to talk about the payouts at the 300% level, the fact is that most companies in the Russell that are in the 90% percentile have hit a home run and been acquired at a huge premium by some other company, just like most of the ones in the bottom 25% have suffered multiple business issues (failed clinical trials, product recalls, lawsuits) such that they are nearing bankruptcy or have already gone out of business. Since most small pharmas pay no dividend, share price appreciation is the primary driver of TSR. It sounds as though you are basically restating and agreeing with what I wrote earlier (prior to the message you quoted). That MNKD's performance is being compared to the components (companies) in the Russell index. My question was really addressed to buyitonsale, to see what he thought the percentiles were referring to. |
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Post by buyitonsale on Sept 1, 2020 12:01:37 GMT -5
The language in the release was not specific enough and I thought that the performance was tied to the overall index. I stand corrected as I looked up some article on this subject. compensia.com/revisiting-relative-tsr/I still believe that the potential of MNKD TSR within the stated period is very strong among peers, especially as we will be compared from the current levels. in May 2023, the company will have been profitable for about 1 year (via royalties) and with ILD indication in play EPS could be between $1-2 by then. This is based on UTHR capturing the most of PAH ILD market as the first approved treatment available (30000 patients vs their current 3000 patients). There is no question in my mind that TreT will replace Tyvaso. Will be fun to see how the market will translate these types of earnings to share price. Time will tell if Castagna will end up with 300% share target. |
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Post by morfu on Sept 1, 2020 12:05:03 GMT -5
So yeah, executives were awarded millions of shares. Mike Castagna: 909,000 shares Steven Binder: 364,000 shares David Thompson: 364,000 shares Joseph Kocinsky: 364,000 shares Stuart Tross: 364,000 shares Alejandro Galindro: 364,000 shares Rose Alinaya: 130,000 shares Total: 2,859,000 sharesSEC FormsThe restricted stock unit will vest on May 22, 2023 provided that the closing price of MannKind common stock on such vesting date is not less than the closing price on August 27, 2020. The number of shares delivered on the vesting date, as a percentage of the target specified in Box 4 above, is determined by the percentile ranking of MannKind total shareholder return (TSR) over the period from August 27, 2020 until May 22, 2023 related to the TSR of the Russell 3000 Pharmaceutical & Biotechnology Index over the same period, as follows: less than 25th percentile=0% of target, 25th percentile=50% of target, 50th percentile=100% of target, 75th percentile=200% percent of target, 90th percentile or higher=300% maximum. Payout values will be interpolated between the percentile rankings above.I am a bit surprised by this. While in principle I am in favor to pay a bonus to management and other employees for extraordinary work, the reward should always be a fraction this extra effort brought the company in financial gain. If the Afrezza trend for adults in USA continues the way it has the last couple of years, that alone would take this company to the green and likely fulfill TSR requirement. The management already rewarded itself for the pediatric Afrezza pathway and the partnership with UTHR, which should guarantee gains over the next 3.5 years. So we are talking about over 8million shares with a potential value over $100mil in total.
I think the question is very justified to ask for what? (Remember they are paid to manage this company and work about 10x harder then the average employee for that and already rewarded them self plenty for two standard procedures.. )
That puts them in a moral obligation to come up with something new and unforeseen over the next 3years benefiting Mannkind way more than $100mil!
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Post by mytakeonit on Sept 1, 2020 14:33:31 GMT -5
I'm a little confused with the wording of this SEC form ... but, awarding executives with shares versus $$$ will always work for me. Also having up to 300% max payouts will have them working harder to hit that 90th percentile or higher. SO ... if we hit my $100 pps number in 3 years ... it'll just cost us nothing more than printing up more shares. And getting share price up to $3.40 is a given. That could happen before the end of September.  If the share price shoots up, then on May 22, 2023 it drops back to $1.70 ... does that put this deal at the "less than 25th percentile" ? But, that's mytakeonit |
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Post by gamblerjag on Sept 1, 2020 16:05:01 GMT -5
I'm a little confused with the wording of this SEC form ... but, awarding executives with shares versus $$$ will always work for me. Also having up to 300% max payouts will have them working harder to hit that 90th percentile or higher. SO ... if we hit my $100 pps number in 3 years ... it'll just cost us nothing more than printing up more shares. And getting share price up to $3.40 is a given. That could happen before the end of September. If the share price shoots up, then on May 22, 2023 it drops back to $1.70 ... does that put this deal at the "less than 25th percentile" ? But, that's mytakeonit well if you get your share price of $3.40 by the end of September your 1/3 of the way to your $10 by the end of the year that you mentioned earlier this year |
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If the share price shoots up, then on May 22, 2023 it drops back to $1.70 ... does that put this deal at the "less than 25th percentile" ?