MONTGOMERYVILLE, Pa., Jan. 24 /PRNewswire-FirstCall/ -- PhotoMedex, Inc. today further clarified the background and purpose of awards of restricted shares of its common stock which it made on January 15, 2006 to Mr. Jeffery O’Donnell, CEO, and Mr. Dennis McGrath, CFO.
The Company held its annual meeting of stockholders on December 28, 2005. The stockholders approved a new 2005 Equity Compensation Plan and also approved awards of restricted shares of common stock under that Plan to its CEO and CFO. The proxy statement set forth in proposal no. 4 to the stockholders the details of the Plan and set forth in proposal no. 6 the amount of the awards and the details of the vesting terms for the restricted shares of common stock. Furthermore, Exhibit C of the proxy statement provided the Restricted Stock Agreement that would evidence the stock awards. A copy of the proxy statement is maintained on the Company’s website at www.photomedex.com under the investor relations section and SEC filings.
The executives only vest in the value of the restricted shares if the market value of the Company’s common stock rises substantially. The 2006 Average Price of the Company stock would need to increase to a 2006 Target Price of $3.13 to enable the executives to vest in just the first 20% of the approved stock award. The 2006 Average Price is defined as the average of the closing prices of the Company’s common stock for each of the trading days in the last three months of the 2006 calendar year.
To further align the executives’ financial incentive with the financial opportunity for stockholders, and to further align the vesting opportunity to substantial continued performance in the fair market value of the Company’s common stock, future vesting is similarly subject to the condition that the Average Price in the last quarter of the year must equal or exceed the Target Price for that year, where the Target Prices are set to advance 25% from year to year. Thus, there is:
20% vesting if the 2007 Average Price equals or exceeds the 2007 Target Price of $3.91; 20% vesting if the 2008 Average Price equals or exceeds the 2008 Target Price of $4.89; 20% vesting if the 2009 Average Price equals or exceeds the 2009 Target Price of $6.11; 20% vesting if the 2010 Average Price equals or exceeds the 2010 Target Price of $7.64
The terms of the awards also allow for years prior to 2010 to vest if the 2010 Average Price equals or exceeds the 2010 Target Price. Subject to continued employment of the executive, any unvested awards become vested ratably on the fifth, sixth and seventh anniversaries of the award of the restricted shares. In the event of a change of control, certain provisions allow for continued vesting, unless the employee is terminated in connection with a change of control, whereby any unvested shares become vested.
Mr. O’Donnell commented: “We are pleased to provide the above clarification. We believe that the restricted stock awards align the executive’s financial incentive with the financial opportunity for our stockholders. We are hopeful that the above explanation addresses some of the inquiries we have received concerning the 2005 Equity Compensation Plan and the award of restricted shares.”
About PhotoMedex
PhotoMedex is engaged in the development of proprietary excimer laser and fiber optic systems and techniques directed toward dermatological applications, with FDA approval to market the XTRAC(R) laser system for the treatment of psoriasis, vitiligo, atopic dermatitis and leukoderma. In addition, the Company provides contract medical procedures to hospitals, surgi-centers and doctors’ offices, offering a wide range of products and services across multiple specialty areas, including dermatology, urology, gynecology, orthopedics, and other surgical specialties. The Company is a leader in the development, manufacturing and marketing of medical laser products and services. In addition as a result of the merger with ProCyte, PhotoMedex now develops and markets products based on its patented, clinically proven Copper Peptide technology for skin health, hair care and wound care. PhotoMedex sells directly to dermatologists, plastic and cosmetic surgeons, spas and salons and through licenses with strategic partners into the consumer market, including a long-term worldwide license agreement with Neutrogena(R), a Johnson & Johnson company. ProCyte brands include Neova(R), Ti-Silc(R), VitalCopper(R), Simple Solutions(R) and AquaSante(R).
Safe Harbor Statement:
Some portions of the press release will contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. While PhotoMedex is working to achieve those goals, actual results could differ materially from those projected in the forward-looking statements as a result of a number of factors, including difficulties in marketing its products and services, need for capital, competition from other companies and other factors, any of which could have an adverse effect on the business plans of PhotoMedex, its reputation in the industry or its results. In light of significant uncertainties inherent in forward-looking statements included herein, the inclusion of such information in the press release should not be regarded as a representation by PhotoMedex or its subsidiaries that the forward-looking statements will be achieved.
Contact: Allen & Caron, Inc. PhotoMedex, Inc. Matt Clawson (investors) Dennis McGrath, CFO 949-474-4300 215-619-3287 matt@allencaron.cominfo@photomedex.com
PhotoMedex, Inc.
CONTACT: Investors, Matt Clawson of Allen & Caron, Inc., +1-949-474-4300,matt@allencaron.com, for PhotoMedex, Inc.; or Dennis McGrath, CFO ofPhotoMedex, Inc., +1-215-619-3287, info@photomedex.com
Web site: http://www.photomedex.com/
