When the deal docs come out, the first thing I like to do is read the background on merger and get a feel for how decisions were sequenced.

Then I'll mentally sketch out the "narrative" I think played out at the company.

https://investors.collectors.com/static-files/b862969b-b318-45f6-8e50-bf130dc612ca
No "narrative" analysis is complete w/o looking at the incentives which brings things to life.

After all, "Show me the incentive and I'll show you the outcome."

After reading background, I'l review the proxy to weave in equity grants within the timeline

https://investors.collectors.com/static-files/77825841-7d69-49ea-b5e5-f8a4b98befce
Long story short, when you look at compensation decisions at CLCT and weave them into the M&A timeline, it's hard to understate how thirsty CEO Joe Orlando is to get paid.

Many really don't appreciate how easy (& legally safer) it is to engage in "dark arts" to enrich insiders
For instance, it is disclosed CLCT engaged in M&A talks in '19 w an offer of $33

Talks would fizzle out in early 2020 and COVID would obliterate the stock. What would CLCT do?

Amend the CEO's employment agreement giving them an excuse to give him equity

https://investors.collectors.com/static-files/6b2790d0-d7f9-40a3-a668-d361d13a2613
CLCT historically grants annual equity to execs in Sept so it's peculiar to see the Board grant the CEO (no one else) equity in March at $15.49 near all time lows.

Also note the original employment agreement is dated Sept 24, 2019. Ink is barely dry and they amended it

Thirsty
These sort of aggressive equity comp decisions tend to signal the CEO has the Board in his back pocket (more so than "typical") and should put shareholders in high alert when it comes to this tender.

Joe is looking out for Joe and all incremental decisions should presume that.
If there's still doubt, take a look at how they approached the CEO's pay & section 280G (i.e. golden parachute excise tax).

The CEO's employment agreement states any payments subject to the tax will be reduced so no portion of the payment will be subject to the excise tax.
The Board would preemptively accelerate 30K RSUs & 11K PSUs "to mitigate against potential adverse tax consequences to Mr. Orlando and Collectors Universe as a result of Section 280G"

The deal isn't closed and investors are pushing for a higher bid yet they're paying out the CEO
Anyway, I've only scratched the surface & this was a quick take. There's A LOT going on at $CLCT I didn't get into

Should be interesting to see how this tender plays out

At this point, CEO is pot committed to getting a deal done or face existential career risk afterwards (FIN)
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