FLINT, Mich., June 5, 2018 /PRNewswire/ -- Diplomat Pharmacy, Inc. (DPLO) ("Diplomat" or the "Company") today announced that the Compensation Committee (the "Compensation Committee") of the Board of Directors (the "Board") has made certain equity awards to new CEO Brian Griffin, effective June 4, 2018. The awards were made pursuant to the Company's previously-announced employment agreement with Mr. Griffin, and as a material inducement to his joining Diplomat as CEO and Chairman of the Board.
The awards made to Mr. Griffin are as follows: (i) a sign-on equity award consisting of 124,875 restricted stock units ("RSUs"), which RSUs will vest on the one year anniversary of the grant date, subject to full acceleration of vesting based on (a) the achievement of a specified stock price performance goal, (b) the termination of employment by Diplomat without cause or resignation by Mr. Griffin with good reason in connection with or within one year of a change in control or (c) a change in control without assumption or substitution of such equity award (provisions (b) and (c), the "Change in Control Acceleration Events"); (ii) a sign-on equity award consisting of 374,625 performance-based restricted stock units ("PSUs") at target, with a maximum amount of up to 1,498,500 PSUs, which PSUs will be earned or forfeited in 2020 upon completion of the Company's 2019 audit, based upon the Company's performance relative to revenue and Adjusted EBITDA budget goals for 2018 and 2019, on a combined basis, provided that the Board or Compensation Committee has discretion to vest a portion of the PSUs after completion of the Company's 2018 audit, and subject to full acceleration of vesting in the event of a Change in Control Acceleration Event; and (iii) make-whole equity awards consisting of: (a) 157,343 PSUs at target, with a maximum amount of up to 629,372 PSUs, which PSUs will be earned or forfeited based upon the Company's performance relative to revenue and Adjusted EBITDA budget goals for 2018; (b) 33,716 RSUs, which RSUs will vest in equal amounts on the first, second and third anniversaries of the grant date; and (c) 81,351 time-based stock options, which stock options will vest in equal amounts on the first, second and third anniversaries of the grant date, and in the case of each make-whole equity award, subject to full acceleration of vesting in the event of a Change in Control Acceleration Event.
The RSUs, PSUs and stock options were all granted outside of the Diplomat Pharmacy, Inc. 2014 Omnibus Incentive Plan (but will generally have terms and conditions consistent with those set forth in that plan), and were approved by the Compensation Committee in reliance on the employment inducement exemption under the NYSE's Listed Company Manual Rule 303A.08, which requires public announcement of inducement awards. Pursuant to the requirements of that rule, Diplomat is issuing this press release.
Forward Looking Statements
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events or our future financial or operating performance, and include Diplomat's expectations regarding revenues, net (loss) income attributable to Diplomat, Adjusted EBITDA, EPS, Adjusted EPS, market share, the expected benefits and performance of acquisitions and growth strategies. The forward-looking statements contained in this press release are based on management's good-faith belief and reasonable judgment based on current information. These statements are qualified by important risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those forecasted or indicated by such forward-looking statements. These risks and uncertainties include: our ability to adapt to changes or trends within the specialty pharmacy industry; significant and increasing pricing pressure from third-party payors; the amount of direct and indirect remuneration fees, as well as the timing of assessing such fees and the methodology used to calculate such fees; the outcome of material legal proceedings; our relationships with wholesalers and key pharmaceutical manufacturers; bad publicity about, or market withdrawal of, specialty drugs we dispense; a significant increase in competition from a variety of companies in the health care industry; our ability to expand the number of specialty drugs we dispense and related services; maintaining existing patients; revenue concentration of the top specialty drugs we dispense; increasing consolidation in the healthcare industry; managing our growth effectively; our ability to drive volume through a refreshed marketing strategy in traditional specialty pharmacy; our capability to penetrate the fragmented infusion market; the success of our strategy in the PBM space; our ability to effectively execute our acquisition strategy or successfully integrate acquired businesses, including any delays or difficulties in integrating the combined businesses, and the ability to achieve cost savings and operating synergies and the timing thereof; the dependence on our senior management and key employees and managing recent turnover among key employees; and the additional factors set forth in "Risk Factors" in Diplomat's Annual Report on Form 10-K for the year ended December 31, 2017 and in subsequent reports filed with or furnished to the Securities and Exchange Commission. Except as may be required by any applicable laws, Diplomat assumes no obligation to publicly update such forward-looking statements, which are made as of the date hereof or the earlier date specified herein, whether as a result of new information, future developments, or otherwise.
Diplomat (DPLO) is the nation's largest independent provider of specialty pharmacy services—helping patients and providers in all 50 states. The company offers medication management programs for people with complex chronic diseases and delivers unique solutions for manufacturers, hospitals, payers, providers, and more. Diplomat opened its doors in 1975 as a neighborhood pharmacy with one essential tenet: "Take good care of patients and the rest falls into place." Today, that tradition continues—always focused on improving patient care and clinical adherence. For more information, visit diplomat.is.
Terri Anne Powers, Vice President,
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Jenny Cretu, Senior Vice President,
Pharma Services and Marketing
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