Avacta (AIM: AVCT) has granted a substantial package of share options to its management team, including 13.4 million options to chief executive Christina Coughlin, as part of an incentive and retention programme linked to the company’s oncology pipeline.
The options were granted on 28 August under Avacta’s Equity Share Option Scheme and carry an exercise price of 69p per share, equal to the mid-market closing price on 27 August.
Chief financial officer and company secretary Brian Hahn received 2 million options, while other members of the management team were granted a further 3.75 million options in aggregate.
Half of Coughlin’s award will vest over four years under the company’s standard schedule, while the remaining half is subject to specified performance-based milestones. Hahn’s options and those awarded to the wider management team will also vest over four years.
Avacta said it took advice from Aon’s Talent Solutions team when structuring the awards. The options are also subject to customary good-leaver and bad-leaver provisions.
As part of the package, Coughlin has agreed to extend her contractual notice period to 12 months, strengthening the company’s ability to retain its chief executive as its clinical programmes progress.
Chairman Richard Hughes said the awards were designed to retain key personnel as Avacta’s assets and clinical data mature, with the option structure intended to align management with shareholders because the awards only generate value if the share price rises above the exercise price.
The company highlighted the recent progression of AVA6103 into clinical trials as an important milestone, marking Avacta’s second pre|CISION drug to enter human studies and the first clinical use of its proprietary controlled-release technology.
The grant to Coughlin constitutes a related-party transaction under AIM Rule 13. Avacta’s independent directors said they considered the terms of the award fair and reasonable for shareholders.
