David R. Margrave
About David R. Margrave
David R. Margrave (age 65) is Lantern Pharma’s Chief Financial Officer (since November 2019) and Corporate Secretary (since June 2018). He holds dual BA/BS degrees in Economics and Petroleum Engineering from Stanford University and a JD from The University of Texas School of Law, and previously served as President/Chief Administrative Officer/General Counsel at BioNumerik Pharmaceuticals and as a partner at Andrews & Kurth LLP . His incentive bonus framework is tied to operational and strategic milestones rather than explicit TSR/revenue/EBITDA targets; the company does not disclose pay-for-performance metrics like TSR weighting or financial KPIs in his plan . He certifies Lantern’s 10-Ks alongside the CEO and is the designated Compliance Officer for the Insider Trading Policy, reinforcing controls around trading, blackout windows, and pre-clearance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| BioNumerik Pharmaceuticals, Inc. | President; Chief Administrative Officer; General Counsel | 1995–2015 | Led corporate/legal functions advancing oncology programs (LP-300 rights later assigned to Lantern) |
| Life sciences consulting (independent) | Consultant to growing life science companies | 2016–2019 | Strategic advisory/legal services to support growth and transactions |
| MedCare Investment Corporation | Senior Legal Advisor | 2015–2016 | Advised on investments in medical/healthcare services |
| Andrews & Kurth LLP | Partner | Pre-1995 | Corporate/legal counsel; foundational capital markets and governance expertise |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Texas Healthcare and Bioscience Institute | Chairman & Board Member | Current | Policy and industry advocacy in Texas life sciences |
| State of Texas Product Development & Small Business Incubator Board | Past Chairman & Board Member | Prior | Oversight and support of commercialization/incubation initiatives |
| Texas Technology Transfer Association | Past Board Member | Prior | Technology transfer ecosystem engagement |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $353,290 | $413,800 |
| Target Bonus (% of Base) | Up to 40% | Up to 40% |
| Actual Bonus Paid ($) | $79,490 | $162,288 |
| Other Compensation ($) – 401(k) | $9,900 | $10,350 |
Notes:
- Bonus eligibility is subject to Lantern achieving operational and strategic milestones mutually agreed with CEO and Margrave; specific targets are not disclosed .
- The Compensation Committee engaged Anderson Pay Advisors as consultant in 2024 .
Performance Compensation
Option Awards and Vesting
| Grant Date | Shares | Exercise Price ($) | Vesting Schedule | Fair Value / Notes |
|---|---|---|---|---|
| 6/15/2020 | 78,300 | 15.00 | Historical grants; shown as exercisable by 12/31/2024 | Eligible for 2025 repricing; WAE $13.80 (range $10.21–$15.00) |
| 10/29/2021 | 26,100 | 10.21 | Exercisable by 12/31/2024 | Eligible for 2025 repricing; included in totals above |
| 7/15/2024 | 52,000 | 4.35 | Vests in equal monthly increments over 24 months commencing 8/15/2024 | 2024 option award fair value $166,448 |
- Outstanding equity at 12/31/2024: 10,830 exercisable and 41,170 unexercisable for the 2024 grant; earlier grants listed as fully exercisable .
- Option repricing approved 9/19/2025: underwater options (> $10.00 strike) repriced to $5.04, subject to an additional 12-month service-based vesting requirement; exercises before Vesting Satisfaction Date remain at original strike . Repriced exercise was set at 125% of 10-day VWAP ending 7/24/2025; closing price on 7/25/2025 was $4.24 .
- Purpose of repricing: address retention/incentive misalignment from deeply underwater options; minimize dilution/expense versus new grants .
Annual Equity and Performance Plan Features
| Feature | Details |
|---|---|
| Equity Plan Capacity | 1,864,680 shares authorized (as amended 4/15/2024) |
| Change-in-Control | All unvested awards immediately vest; options remain exercisable for full term |
| Performance Awards | Plan permits performance awards, but none disclosed for named executives to date |
| Clawback Policy | Adopted Nov 27, 2023 (effective Oct 2, 2023) per SEC Rule 10D-1/Nasdaq 5608; mandatory recovery of erroneously awarded incentive compensation over 3-year lookback upon restatement |
Equity Ownership & Alignment
| Ownership Metric (as of 7/23/2025) | Value |
|---|---|
| Beneficial Ownership (shares) | 134,729 (options exercisable within 60 days) |
| Beneficial Ownership (% of outstanding) | 1.23% |
| Unvested (within 60 days, excluded) | 21,671 shares underlying options |
| Shares Outstanding | 10,784,725 |
| Hedging/Pledging | Prohibited for directors, officers, and designated employees; no short sales, options, hedging, margin accounts, or pledging; pre-clearance required for trades |
Implications:
- Ownership is largely in options, with many grants previously underwater; 2025 repricing creates potential equity value contingent on 12 months of continued service and future stock performance .
- No disclosed director/officer ownership guidelines by multiple of salary; compliance not applicable based on proxy disclosures .
Employment Terms
- Role/Start: CFO since November 2019; Corporate Secretary since June 2018 .
- Employment Agreement: Term formally expired Nov 15, 2024; continues for employment but severance and change-in-control payment provisions in his employment agreement expired on that date . Bonus eligibility up to 40% of base salary; milestones mutually agreed with CEO .
- Equity Acceleration: Separate from the employment agreement, the Equity Incentive Plan provides immediate vesting of all unvested securities upon change-in-control, with options exercisable for full term .
- “Cause” Definition: Includes failure to achieve mutually agreed operational/strategic milestones and other enumerated behaviors (material breach, refusal to follow Board instructions, etc.), with cure rights for some items .
- Perquisites/Pension: No perquisites generally; 401(k) employer contributions ($10,350 in 2024; $9,900 in 2023) .
- Insider Trading & Trading Windows: CFO serves as Compliance Officer; quarterly blackout periods start two weeks before quarter-end and end two trading days after results disclosure; pre-clearance required for insiders; Rule 10b5-1 plan procedures defined .
Related Party and Governance Indicators
- Related Party Transaction History: Lantern acquired LP-300 (Tavocept) IP from BioNumerik in 2018; Margrave previously held a minority interest in BioNumerik; assignment includes royalty/share arrangements and recoveries of costs . Oversight of related party transactions rests with the Audit Committee .
- Say-on-Pay: No advisory vote disclosed in 2024/2025 proxy agendas; committee uses independent consultant (Anderson Pay Advisors) .
- 2025 Shareholder Vote: Stock option repricing proposal approved; Margrave signed the 8-K reporting vote results .
Performance & Track Record
- SEC Certifications: Margrave signed 2024 10-K Section 302 and 906 certifications alongside the CEO .
- Program Execution: Equity repricing initiative framed to retain employees/directors and align incentives amidst multi-year share price decline; defined premium strike and 12-month service vest condition .
Risk Indicators & Red Flags
- Underwater Options/Repricing: One-time repricing of options above $10 to $5.04 can draw investor scrutiny; however, premium strike and 12-month vesting mitigate windfall optics and emphasize retention .
- Severance Economics: Expiration of severance/change-in-control cash benefits in the employment agreement could reduce guaranteed downside protection for the CFO; retention relies more heavily on equity and ongoing bonus opportunities .
- Related Party Legacy: Historical minority interest at BioNumerik during LP-300 IP assignment is disclosed; ongoing governance handled via Audit Committee .
- Hedging/Pledging: Prohibitions reduce misalignment risk and leverage exposure; strict pre-clearance reduces timing/insider risk .
Compensation Structure Analysis
- Mix Trends: 2024 compensation increased in cash (base + bonus) vs 2023; equity awards resumed in 2024 after no option awards in 2023 for Margrave .
- Risk Profile Shift: Continued reliance on options (vs RSUs/PSUs) retains performance sensitivity to share price; repricing adds a retention tilt while maintaining a premium over market .
- Pay-for-Performance Calibration: Bonuses hinge on operational/strategic milestones but absent disclosed quantitative targets (revenue, EBITDA, TSR); transparency on hurdle-setting is limited .
Investment Implications
- Alignment: Ownership via options (1.23%) and strict anti-hedging/pledging policy support alignment; repricing adds service-based retention but still requires value creation (strike at 125% of VWAP) .
- Retention/Selling Pressure: Monthly vesting on 2024 grant and 12-month vesting requirement for repriced options reduce near-term selling pressure; monitor Form 4 filings for post-repricing exercises or sales following blackout windows .
- Governance Quality: Active clawback policy and robust insider trading controls lower governance risk; absence of disclosed quantitative bonus KPIs limits pay-performance transparency .
- Execution Risk: Equity-heavy incentives and repricing signal a multi-year stock decline; value realization depends on pipeline execution (LP-300 Harmonic, LP-184/STAR-001, LP-284) and capital access; CFO’s certifications and compliance oversight are positives for controls .
Overall: Compensation emphasizes options with newly repriced underwater grants contingent on continued service; bonus plans lack disclosed quantitative targets; policies prohibit hedging/pledging and enforce clawbacks—supportive of alignment and controls—while repricing and severance term expirations highlight retention needs amid share price pressure .