CEO’s exercise and hold again today of 10,000 options that didn't expire until 12/21/19 (second time in 5 days and third time this year), earlier than necessary, whereby he has to pay cash now (relatively small amount for him), and pay taxes (this year) on ordinary gain (market price less 1.35) much earlier than would otherwise be the case, in return for locking in a basis for purpose of long term capital gains treatment, is a bullish sign. He (and Thero) did it earlier when pps was higher. JZ putting his money (and his tax liability) out there to increase his stake. Have to like it.
If they are in a blackout period, this could be the next best thing to open market purchases.
Sentiment: Strong Buy
If AMRN is in a blackout period (as has been claimed), would you really want its CEO buying shares in the open market (risking criminal investigation/charges?
If they are not in a blackout period, you'll likely be asleep for awhile waiting for an open market purchase. From yesterday's Form 4: "As of the date of this Form 4, the Reporting Person owns or holds the right to acquire, subject to vesting conditions, an aggregate of 3,089,604 Ordinary Shares of the Issuer in the form of (i) stock options and Restricted Stock Units granted under the Amarin Corporation plc 2002 Stock Option Plan and the Amarin Corporation plc 2011 Stock Option Plan and (ii) 141,937 Ordinary Shares." Unlikely that someone holding that amount of options/RSUs is going to make an open market purchase anytime soon.
Insignificant? Why would he, three times, obligate himself to pay, this year instead of in 2019, income tax, at ordinary rates, on the gain he has to recognize at exercise, in addition to the cash outlay to exercise, if he didn't think shares are undervalued and likely to appreciate significantly?
Sentiment: Strong Buy
1. someone posted on ST that they spoke by phone to IR and that Bruno (who is handling IR matters) had mentioned they were in a "blackout period," although it was never quite clear that that term was specifically used in the discussion;
2. i was pleased that he exercised 10K more options but the purchase may have simply been possibly as a result of what i would imagine has been an onslaught of complaints from irate stockholders that mgmt seemed unwilling to share their pain or to more actively publicly defend the company in the face of a continually tanking sp ;
3. my understanding is that the exercise of the options was in accord w/ an existing 10-B and, therefore, even if in blackout period was proper; and,
4. even tho his cost really was chump change, i too hope it was a sign of better things to come.
hard to read the exact meaning of the purchase. some are saying it was meant to send a subtle message that there really in a blackout period and cannot actively respond to bashers, others that it was simply to quiet the maddening crowd--particularly before the annual meeting. remember he already has made a profit on the shares even at the current sp as his cost was around a $1.35.
hope this answers your questions
According to mb, there was a fellow who posted on stocktwit that he had called IR and was told they are in a blackout period. This has not been verified to my knowledge, which is why I said "If ...."
My point was/is that from CEO's perspective, if he can't buy in the open market because they are in a blackout period, at least being able to exercise and hold, though it has undesirable near term tax consequences (has to pay ordinary income tax this year on the difference between the market price and exercise price), at least he can establish a basis for long term cap gains treatment of the gain above his basis, assuming he holds these shares for longer than one year, and he can commence the running of the one year holding period.
There is only one reason for an insider to do this. He thinks the pps is at or near a bottom, and moreover anticipates a substantial rise in pps between now and when he sells the shares.
I'm not getting excited. Merely pointing out that JZ has exercised and held early three times this year, and the only reason for him to do so is if he thinks the pps is at or near a bottom and he is willing to pay tax at ordinary income rates on the gain now (instead of in 2019) and wants to set the basis as low as possible for LTCG treatment. This strategy is quite common.
Since he knows a bit more than you and I about what is and will be happening with AMRN, I choose to think it is noteworthy. If you interpret it to be meaningless, you are certainly entitled to your opinion.
Sentiment: Strong Buy
True, but since these options weren't expiring soon, it could amount to the best positive indicator they could make at this time. I'm just not sure if this kind of options exercise would qualify as a breach of a silent period or not. Can an expert weigh in?
Buying ISOs is insane (the AMT eats you alive, something I know from painful experience), UNLESS, you are positive that the price is going to be way up over the next year. You need to hold the stock for that year to get a long term cap gains rate of 20% for the ISO profits rather than (for JZ) the highest tax bracket of 37%. This is a completely confident CEO....