CPEX officials to get $22m in deal


The members of CPEX Pharmaceuticals' board and the company's executives, who are recommending that the Exeter-based firm sell itself to the subsidiary of a bankrupt shoe company, will receive a total of $22 million in the deal for themselves and their families, according to disclosures filed last week with the Securities and Exchange Commission.That's more than a quarter of the $77.6 million deal announced shortly after New Year's Day. However, there is no provision for workers to keep their jobs.The total includes stock held by four executives and four board members that is being sold for $27.25 a share, as well as various accelerated stock options, restricted stock, bonus payouts, life insurance and health coverage, and - in an amount not quantified - six years' indemnity insurance against any legal action against them. Nearly a dozen law firms have announced that they are seeking clients for possible law suits based on the merger.The filing also contains the first detailed look at the history of the merger, and the reason the board is recommending the sale.The payout information is included so that shareholders, who get to vote on the deal, are aware of any "conflict of interest" in the company. A CPEX spokesman said that - at least when it comes to common stock - the board members and executives have the same exact interest of any other shareholder.All of the executives and board members, who own about a fifth of the voting stock, have pledged to back the deal. If they renege, or the deals falls through, or CPEX happens to get a better offer (it is not allowed to look for one), the pharmaceutical firm will have to pay the would-be buyers $1.9 million for their trouble. -- BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW
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