CytoSorbents Announces Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

CytoSorbents (NASDAQ: CTSO), a leader in blood purification technology for treating life-threatening conditions, has announced inducement equity awards for its newly-hired Chief Financial Officer, Peter J. Mariani. The awards, granted on August 14, 2024, include:

• A non-qualified stock option to purchase 215,000 shares of common stock, vesting based on performance milestones
• Restricted stock units (RSUs) for 65,000 shares, vesting over two years
• RSUs for 110,000 shares, vesting upon a change of control or after four years
• RSUs for 175,000 shares, vesting only upon a change of control
• A non-qualified stock option for 80,000 shares with staggered vesting

The options have an exercise price of $0.90 per share. These awards were approved under Nasdaq Listing Rule 5635(c)(4) as employment inducement grants.

Positive

• Appointment of a new Chief Financial Officer, Peter J. Mariani
• Comprehensive equity incentive package to align CFO's interests with company performance and shareholder value

Negative

• Potential dilution of existing shareholders due to the issuance of new equity awards

PRINCETON, N.J., Aug. 16, 2024 (GLOBE NEWSWIRE) -- CytoSorbents Corporation (NASDAQ: CTSO), a leader in the treatment of life-threatening conditions in the intensive care unit and cardiac surgery using blood purification via its proprietary polymer adsorption technology, today announced that it granted inducement equity awards on August 14, 2024 (the “Grant Date”) to its newly-hired Chief Financial Officer, Peter J. Mariani.

The inducement equity awards consist of (i) a non-qualified stock option to purchase 215,000 shares of CytoSorbents’ common stock (“Common Stock”), which vest upon the achievement of certain performance milestones described in Mr. Mariani’s employment agreement, (ii) restricted stock units (“RSUs”) relating to 65,000 shares of Common Stock, which vest in two equal annual installments on the first and second anniversaries of the Grant Date, (iii) RSUs relating to 110,000 shares of Common Stock, which vest upon the earlier of a change of control of CytoSorbents and the four year anniversary of the Grant Date, (iv) RSUs relating to 175,000 shares of Common Stock, which vest only upon a change of control of CytoSorbents, and (v) a non-qualified stock option to purchase 80,000 shares of Common Stock, 41,000 shares of which vest on the six-month anniversary of the Grant Date and the remaining 39,000 shares vest in three equal annual installments on the first, second and third anniversaries of the Grant Date. The foregoing options have an exercise price of $0.90 per share, which is equal to the closing price of Common Stock as of the date immediately prior to the Grant Date.

The inducement equity awards were approved by the Board of Directors of CytoSorbents in reliance on the employment inducement exception under Nasdaq Listing Rule 5635(c)(4). While the inducement awards were granted outside of CytoSorbents’ Equity Incentive Plan, the awards will have terms and conditions consistent with those set forth under the plan.

About CytoSorbents Corporation (NASDAQ: CTSO)

CytoSorbents Corporation is a leader in the treatment of life-threatening conditions in the intensive care unit and in cardiac surgery through blood purification. Its lead product, CytoSorb^®, is approved in the European Union and distributed in 76 countries worldwide. It is an extracorporeal cytokine adsorber that reduces “cytokine storm” or “cytokine release syndrome” in common critical illnesses that can lead to massive inflammation, organ failure and patient death. In these diseases, the risk of death can be extremely high, and there are few, if any, effective treatments. CytoSorb is also used during and after cardiothoracic surgery to remove antithrombotic drugs and inflammatory mediators that can lead to postoperative complications, including severe bleeding and multiple organ failure. As of June 30, 2024, more than 248,000 CytoSorb devices have been used cumulatively. CytoSorb was originally launched in the European Union under CE mark as the first cytokine adsorber. Additional CE mark extensions were granted for bilirubin and myoglobin removal in clinical conditions such as liver disease and trauma, respectively, and for ticagrelor and rivaroxaban removal in cardiothoracic surgery procedures. CytoSorb has also received FDA Emergency Use Authorization in the United States for use in adult critically ill COVID-19 patients with impending or confirmed respiratory failure. CytoSorb is not yet approved in the United States.

The DrugSorb™-ATR antithrombotic removal system, an investigational device based on the same polymer technology as CytoSorb, has received two FDA Breakthrough Device Designations, one for the removal of ticagrelor and another for the removal of the direct oral anticoagulants (DOAC) apixaban and rivaroxaban in a cardiopulmonary bypass circuit during urgent cardiothoracic procedures. The Company has completed the FDA-approved, randomized, controlled STAR-T (Safe and Timely Antithrombotic Removal-Ticagrelor) study of 140 patients at approximately 30 centers in U.S. and Canada to evaluate whether intraoperative use of DrugSorb-ATR can reduce the perioperative risk of bleeding in patients receiving ticagrelor and undergoing cardiothoracic surgery. This pivotal study is intended to support U.S. FDA and Health Canada marketing approval for DrugSorb-ATR in this application.

CytoSorbents’ purification technologies are based on biocompatible, highly porous polymer beads that can actively remove toxic substances from blood and other bodily fluids by pore capture and surface adsorption. Its technologies have received non-dilutive grant, contract, and other funding of approximately $50 million from DARPA, the U.S. Department of Health and Human Services (HHS), the National Institutes of Health (NIH), National Heart, Lung, and Blood Institute (NHLBI), the U.S. Army, the U.S. Air Force, U.S. Special Operations Command (SOCOM), Air Force Material Command (USAF/AFMC), and others. The Company has numerous marketed products and products under development based upon this unique blood purification technology protected by many issued U.S. and international patents and registered trademarks, and multiple patent applications pending, including ECOS-300CY^®, CytoSorb-XL™, HemoDefend-RBC™, HemoDefend-BGA™, VetResQ^®, K⁺ontrol™, DrugSorb™, ContrastSorb, and others. For more information, please visit the Company’s websites at www.cytosorbents.com and www.cytosorb.com or follow us on Facebook and X. 

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U.S. Company Contact:
Dr. Phillip Chan, CEO
305 College Road East
Princeton, NJ 08540
pchan@cytosorbents.com

Investor Relations Contact:
Eric Ribner
LifeSci Advisors, LLC
250 W 55^th St, #3401
New York, NY 10019
ir@cytosorbents.com

FAQ

What inducement grants did CytoSorbents (CTSO) offer to its new CFO?

CytoSorbents offered its new CFO, Peter J. Mariani, a package including stock options for 215,000 shares vesting on performance milestones, RSUs for 65,000 shares vesting over two years, RSUs for 110,000 shares vesting after four years or change of control, RSUs for 175,000 shares vesting only on change of control, and stock options for 80,000 shares with staggered vesting.

What is the exercise price of the stock options granted by CytoSorbents (CTSO) to its new CFO?

The stock options granted to the new CFO have an exercise price of $0.90 per share, which was equal to the closing price of CytoSorbents' common stock on the day before the grant date (August 14, 2024).

Under which Nasdaq rule did CytoSorbents (CTSO) grant these inducement awards?

CytoSorbents granted these inducement awards under the employment inducement exception of Nasdaq Listing Rule 5635(c)(4), which allows for equity grants outside of the company's standard equity incentive plan.

When were the inducement equity awards granted by CytoSorbents (CTSO) to its new CFO?

CytoSorbents granted the inducement equity awards to its new CFO, Peter J. Mariani, on August 14, 2024.