Scott Kellen
About Scott Kellen
Scott Kellen is Chief Financial Officer and Corporate Secretary of DiaMedica Therapeutics (DMAC). He joined as VP Finance in January 2018 and was appointed CFO and Secretary in April 2018; he is 59 years old, holds a BS in Business Administration from the University of South Dakota, and is a Certified Public Accountant (inactive) . Over 25 years in life sciences, he has held finance and operating roles at public growth-stage companies and Deloitte . Under his tenure, DMAC’s Pay vs Performance disclosure shows a strong improvement in cumulative total shareholder return (value of a $100 investment rose to $342 by 2024) despite widening net losses (2024: $(24.381) million), indicating option-heavy pay moves with TSR while fundamentals remain loss-making .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| DiaMedica Therapeutics | Vice President of Finance; Chief Financial Officer & Secretary | 2018–present (VP Finance Jan 2018–Apr 2018; CFO & Secretary since Apr 2018) | Finance leadership at a publicly traded, clinical-stage biotech |
| Panbela Therapeutics (Sun BioPharma) | Vice President & Chief Financial Officer | Oct 2015–Apr 2018 | CFO of a publicly traded clinical-stage drug developer |
| Kips Bay Medical | Chief Financial Officer & Secretary; Chief Operating Officer | Feb 2010–Sep 2015 (COO from Mar 2012) | CFO/COO at a publicly traded medical device company |
| Transoma Medical | Finance Director | Nov 2007–May 2009 | Finance leadership in medtech |
| ev3 Inc. | Corporate Controller | 2005–Oct 2007 | Corporate controllership in medical devices |
| Deloitte & Touche | Senior Manager, Audit & Advisory Services | Mar 2003–Apr 2005 | Audit/advisory for public companies; CPA (inactive) |
External Roles
- None disclosed in Company filings reviewed for Mr. Kellen .
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base salary ($) | 357,000 | 380,000 (6% YoY increase) |
| 401(k) match ($) | 16,650 | 13,800 |
| HSA contribution ($) | — | 3,450 |
| All other comp ($) | 16,650 | 17,250 |
Notes:
- CFO 2024 base salary increase approved March 2024 to align closer to peer target and reflect cost-of-living .
- Company generally avoids executive perquisites; executives receive standard employee benefits .
Performance Compensation
Annual Short-Term Incentive (STI)
| Item | Detail |
|---|---|
| Target bonus opportunity | 40% of base salary |
| 2024 target ($) | $152,000 (40% of $380,000) |
| 2024 actual payout ($) | $147,934 (includes $30,400 discretionary upward adjustment, 20% of target) |
| Corporate vs individual weighting | 75% corporate, 25% individual |
| 2024 achievement rates | Corporate: 76.4% of target; Individual (CFO): 80% of target |
| Corporate objective themes | ReMEDy2 trial execution, manufacturing, capital raising |
Detailed 2024 STI metrics and payout:
| Metric | Weight | Target | Actual | Payout Impact |
|---|---|---|---|---|
| Corporate objectives | 75% | 100% | 76.4% | Drives 75% of STI; applied company-wide |
| Individual objectives (CFO) | 25% | 100% | 80% | Focus areas included accounting and financial reporting, organization development, evidence development, partnering |
| Discretionary adjustment | — | — | +$30,400 | 20% of target, recognizing efforts on preeclampsia program and ReMEDy2 protocol amendment |
Long-Term Incentives (LTI) – Stock Options
| Grant | Grant date | Shares | Exercise price | Grant-date fair value | Vesting |
|---|---|---|---|---|---|
| Annual LTI (CFO) | 06/01/2024 | 130,000 | $2.90 | $274,521 | 25% on 1-year anniversary; remaining 75% in 12 equal quarterly installments thereafter |
| Valuation assumptions (2024 grants) | — | — | — | $2.11–$2.24 per option; 4.0–4.5% risk-free; 5.5–5.7 yr expected life; 87.1–102.5% volatility | Black-Scholes model per ASC 718 |
Outstanding equity awards at 12/31/2024 (CFO):
| Instrument | Exercisable (#) | Unexercisable (#) | Exercise price | Expiration |
|---|---|---|---|---|
| Stock options | 50,250 | — | CAD$11.20 | 04/17/2028 |
| Stock options | 99,750 | — | US$4.60 | 06/23/2029 |
| Stock options | 35,000 | — | US$4.64 | 05/31/2030 |
| Stock options | 48,750 | 11,250 | US$5.00 | 07/27/2031 |
| Stock options | 37,500 | 22,500 | US$2.45 | 05/31/2032 |
| Stock options | 25,125 | 41,875 | US$2.73 | 05/31/2033 |
| Stock options | — | 130,000 | US$2.90 | 05/31/2034 |
- LTI policy: annual grants typically on June 1; new-hire awards mid-month after start/approval; equity grants generally avoided around MNPI filings per grant-timing policy .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 346,603 shares (includes derivatives exercisable within 60 days) |
| Ownership % of outstanding | <1% (shares outstanding 42,855,660 as of Mar 18, 2025) |
| Options exercisable/within 60 days | 314,313 underlying shares (CFO) |
| RSUs/DSUs within 60 days | None for CFO |
| 2023 insider purchase | Bought 10,000 shares for $39,100 in June 2023 private placement ($3.91/sh for participating directors and officers) |
| Hedging/pledging policy | Company prohibits hedging and pledging of DMAC securities |
| Ownership guidelines | LTI program aims to “encourage significant share ownership”; specific executive ownership multiples not disclosed |
Implications:
- Large unvested and unexercisable option inventory vests through 2034, aligning upside with TSR but creating periodic vesting-related supply; policy banning hedging/pledging reduces misalignment risk .
Employment Terms
| Provision | Without Cause (no CIC) | Termination with Good Reason/Without Cause in connection with or within 12 months after Change in Control | Other Key Terms |
|---|---|---|---|
| Salary continuation | 9 months (CFO) | 12 months (CFO) | Subject to executed separation agreement/release |
| COBRA premium reimbursement | During salary continuation period | During salary continuation period | — |
| Bonus | Pro rata portion of target annual bonus for year of termination | Pro rata portion of target annual bonus for year of termination | — |
| Equity acceleration | Immediate acceleration of all or a portion of equity awards (per agreements/plan terms) | Immediate acceleration of all or a portion of equity awards (per agreements/plan terms) | 2019 Plan also allows Board discretion on treatment at CIC |
| Triggers/definitions | “Cause,” “Good Reason,” and “Change in Control” defined in agreements | Double-trigger for severance/CIC benefits | — |
| Clawback policy | Mandatory recoupment adopted in 2023 for incentive comp upon restatement per SEC/Nasdaq rules | ||
| Indemnification | Executed indemnification agreements; advancement subject to conditions under BCBCA and Articles | ||
| Restrictive covenants | Standard confidentiality, non-compete, non-solicit; durations not disclosed |
Compensation Structure Analysis
- Pay mix emphasizes at-risk compensation: STI (cash) tied 75% to corporate goals and 25% to individual goals; LTI delivered solely via time-vested options intended to align with shareholders and promote retention .
- Year-over-year shifts: 2024 base salary +6% to $380,000; option grant fair value rose to $274,521 (from $146,790 in 2023), increasing equity intensity; STI target remained 40% of salary .
- Discretionary payouts: 2024 STI included a discretionary upward adjustment of $30,400 (20% of target) for the CFO despite corporate achievement at 76.4%, indicating committee discretion tied to strategic initiatives (preeclampsia/ReMEDy2) .
- Governance checks: No hedging/pledging; clawback policy in place; no option repricing without shareholder approval; strong say‑on‑pay support (~96% in prior year) .
Say‑on‑Pay, Peer Group, and Committee Practices
- Say‑on‑Pay: ~96% approval at the prior annual meeting, suggesting shareholder support for the compensation program .
- Peer group and philosophy: Committee targets around the 50th percentile of a 18‑company small/mid biotech peer set; uses Alpine Rewards as independent advisor (no other services) .
- Equity grant policy: Standardized grant dates and blackout avoidance around material filings to mitigate timing risk .
Performance & Track Record Signals
| Measure | 2022 | 2023 | 2024 |
|---|---|---|---|
| Value of $100 investment (TSR) | $41 | $74 | $342 |
| Net income (loss), $000s | (13,676) | (19,381) | (24,381) |
- Company states compensation actually paid has tracked TSR over the last three years, reflecting the equity-heavy design; net losses increased over the same period .
Additional Disclosures/Attestations
- SOX 906 certification: CFO certified the FY2024 10‑K under Section 906 (18 U.S.C. 1350) on March 17, 2025 .
- Recent executive action: CFO signed 8‑K dated August 6, 2025 announcing CMO transition; indicates ongoing senior officer role and signatory responsibilities .
Investment Implications
- Alignment and incentives: Option-only LTI with multi-year vesting, ban on hedging/pledging, and clawback policy align the CFO with equity value creation and mitigate misalignment risk; strong say‑on‑pay support reduces governance overhang .
- Retention vs. selling pressure: Significant unvested options (e.g., 130,000 from 2024 grant) vest through 2034, supporting retention but creating periodic vesting-driven supply; upcoming expirations span 2028–2034 .
- Pay-for-performance calibration: STI weighting (75% corporate) tied to clinical, manufacturing, and financing milestones aligns with key value inflection points; 2024 discretionary boost underscores committee flexibility to recognize strategic progress despite sub-target corporate score .
- Ownership “skin in the game”: Beneficial ownership is <1% but includes a 2023 insider share purchase; substantial option exposure links outcomes to TSR, which has improved sharply, though core financials remain loss-making—elevating execution risk around clinical/regulatory milestones .