Stuart Rich
About Stuart Rich
Stuart Rich, MD (age 75) is Tenax Therapeutics’ Chief Medical Officer since January 2021 and a director since February 2021; he is a pulmonology/cardiology key opinion leader with decades of clinical and regulatory experience, including service on the FDA’s Cardiovascular and Renal Advisory Committee (2002–2013) . Education: BS Biology (University of Illinois), MD (Loyola University Stritch), residency (Washington University in St. Louis), fellowship (University of Chicago) . Company performance context: Tenax had no revenue in recent years, and net losses were $(17.6)M (2024), $(7.7)M (2023), $(11.0)M (2022); cumulative TSR proxies show $100 invested ended at $0 (2024), $1 (2023), $11 (2022) reflecting biotech financing/trial progression risk .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Northwestern Univ. Feinberg School of Medicine | Professor of Medicine; Professor Emeritus since 2021 | 2015–present | Led Pulmonary Vascular Disease program; advanced PH clinical research |
| Bluhm Cardiovascular Institute (Northwestern) | Director, Pulmonary Vascular Disease Program | 2015–2021 | Built specialty program in pulmonary hypertension |
| University of Chicago, Pritzker School of Medicine | Professor of Medicine, Section of Cardiology | 2004–2015 | Cardiology leadership, PH expertise |
| Rush Heart Institute, Rush Univ. School of Medicine | Professor of Medicine | 1996–2004 | Academic leadership in cardiology |
| Univ. of Illinois College of Medicine (Chicago) | Professor of Medicine; Chief of Cardiology | 1980–1996 | Department leadership, training programs |
| United Therapeutics | Part-time Chief Medical Officer | Oct 2003–Dec 2004 | Industry CMO experience in PAH therapeutics |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Pulmonary Vascular Research Institute (UK charity) | Co-founder & Trustee | 2006–2023 | Global PH network and research advocacy |
| Cardiovascular Medical and Research Foundation (US charity) | Director | 2006–present | Philanthropic governance in cardiovascular research |
| FDA Cardiovascular & Renal Advisory Committee | Standing Member | 2002–2013 | Regulatory advisory leadership in CV/renal drugs |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | 318,000 | 287,832 |
| Target Bonus % of Base | 40% | 40% |
| Actual Annual Bonus ($) | 127,200 | 175,000 |
| Discretionary Recognition Bonus ($) | – | 75,000 |
| All Other Compensation ($) | 36,023 | 10,212 |
| Option Awards – Grant Date Fair Value ($) | – | 2,590,000 |
Notes:
- 2024 base salary was increased to $445,000 in Oct 2024 (prorated for 3-day week from June 15, 2024) and further increased to $525,000 effective Jan 2025 (prorated to $315,000 for three-day week, per amended schedule) .
Performance Compensation
| Metric | Weighting | Target | Actual | Payout | Vesting/Measurement |
|---|---|---|---|---|---|
| Annual Operational Goals (Company-defined) | Not disclosed | 40% of base | 160% achievement (Comp Committee) | $175,000 (2024) | Evaluated annually by Compensation Committee |
| Recognition Bonus (discretionary) | N/A | N/A | Significant contributions (2024) | $75,000 (2024) | Discretionary, paid in 2024 |
| Inducement Option Award (160 sh) | N/A | N/A | Milestone-based | N/A | 25% vests at: Phase 3 start; Trial database lock; IND acceptance; FDA approval; 10-year term; $2,848 strike |
| 2024 Option Award (May, 119 sh) | N/A | N/A | Time-based | N/A | Vests 25% annually from May 17, 2025; $3.549 strike |
| 2024 Option Award (Dec, 500,000 sh) | N/A | N/A | Time-based | N/A | Exercisable beginning Dec 10, 2025; $5.94 strike; expires Dec 10, 2034 |
Equity Ownership & Alignment
| Metric | As of Sep 10, 2024 | As of Apr 14, 2025 |
|---|---|---|
| Options vested/vesting within 60 days | 71 sh | 116 sh |
| Trust holdings (Andrea Rich 2021 Irrevocable Trust) | 1,194 sh | 1,194 sh |
| Trust holdings (Stuart Rich 2022 Irrevocable Trust) | 1,194 sh | 1,194 sh |
| Total beneficial ownership (disclosed line item) | 2,725 sh; <1% of class | Not separately tallied in table |
| Shares pledged/hedged | Not disclosed | Not disclosed |
Outstanding Equity Awards (Dec 31, 2024)
| Award | Exercisable (#) | Unexercisable (#) | Strike ($/sh) | Expiration | Vesting Notes |
|---|---|---|---|---|---|
| Legacy time-based option | 32 | 31 | 992 | 6/9/2032 | 25% annually (Jun 2023–Jun 2026) |
| Inducement milestone option | 79 | 78 | 2,848 | 1/15/2031 | 25% at each clinical/FDA milestone |
| May 2024 grant | 39 | 118 | 3.549 | 5/17/2034 | 25% annually starting 5/17/2025 |
| Dec 2024 grant | – | 500,000 | 5.94 | 12/10/2034 | Exercisable from 12/10/2025 |
Stock ownership guidelines and compliance status: not disclosed in proxy .
Employment Terms
| Term | Detail |
|---|---|
| Employment Agreement | Effective Jan 15, 2021; amended Jun 12, 2024; one-year term, auto-renew unless 90-day notice |
| Base Salary | Initially $300,000; increased to $333,900, $445,000 (Oct 2024), and $525,000 effective Jan 2025; Jan 2025 prorated to $315,000 for 3-day week |
| Target Annual Bonus | 40% of base; no cap for >100% achievement |
| Benefits | Medical/dental and other plans same as officers |
| Severance (without cause, good reason, or non-renewal) | 1 year base salary; pro-rated bonus assuming 100% goal achievement; acceleration of vesting of all equity awards; 1 year COBRA reimbursements/benefits; subject to release |
| Definitions | “Cause” and “Good Reason” detailed (policy/material breach, misappropriation, duties reduction, etc.) |
| Change-of-Control | Specific CoC multipliers/terms not separately disclosed for Dr. Rich |
| Clawbacks / Gross-ups | No tax gross-ups; clawback policy not disclosed |
Board Governance
- Board service: Director since Feb 2021; the Board has an independent Chair (Gerald Proehl) and separate CEO (Christopher Giordano), supporting independent oversight .
- Independence: Dr. Rich is management (not counted among independent directors); the Audit, Compensation, and Corporate Governance/Nominating committees are fully independent .
- Committee memberships and activity (Dr. Rich is not listed as a member):
- Audit & Compliance Committee: Almenoff, Davidson, Hunter (Chair); met 4 times in 2024 .
- Compensation Committee: Hunter, Davidson, Proehl (Chair); met once in 2024; engages Anderson Pay Advisors as independent consultant .
- Corporate Governance & Nominating: Almenoff (Chair), Doogan, Proehl; met once in 2024 .
Director Compensation
- Non-employee director fees and option awards are disclosed; employee directors like Dr. Rich receive executive compensation (no separate director retainer) . Non-employee director fee schedule: $45,000 annual retainer; committee fees; Chair higher retainers; 2024 option grants adjusted post-plan amendment .
Performance & Track Record
- Tenax program progress during Rich’s tenure: FDA cleared IND for oral levosimendan in PH-HFpEF (Nov 13, 2023); Phase 3 LEVEL trial initiated in Q4 2023; LEVEL-2 planned for 2025; open-label extension planned post-randomized phase . Financing secured: ~$100M private placement (Aug 2024) and $25M (Mar 2025) to accelerate Phase 3 programs .
- Pay-versus-performance context: Company is pre-revenue with focus on clinical milestones; net losses and TSR reflect development-stage risk profile and capital raising; TSR index values $0 (2024), $1 (2023), $11 (2022) for a fixed $100 investment .
Compensation Structure Analysis
- Mix shift to equity: 2023 had no option awards; 2024 introduced significant option grant-date fair value ($2.59M), indicating a pivot to long-term equity incentives aligned with program milestones and tenure-based vesting .
- Increased guaranteed cash but time commitment reduced: base salary increased in Oct 2024 and Jan 2025, but prorated for a three-day schedule, moderating cash outlay .
- Performance rigor: annual goals assessed at 160% in 2024, driving bonus outcomes; specific metric taxonomy not disclosed (operational goals) .
- No tax gross-ups; awards timed on fixed dates; repricing prohibited without shareholder approval under the plan (general plan feature) .
Vesting Schedules and Insider Selling Pressure
- Near-term exercisability: large Dec 2024 option (500,000 sh) becomes exercisable starting Dec 10, 2025—this could introduce potential supply if in-the-money and liquidity allows; milestone option vests upon Phase 3 progress and regulatory events, potentially clustering vest dates around key catalysts .
- Form 4 trading patterns not analyzed here; beneficial ownership shows relatively modest direct/near-term exercisable positions vs large unexercisable grants, reducing immediate selling pressure risk .
Equity Ownership & Alignment Signals
- Beneficial ownership under 1% with trust holdings; significant unvested/milestone-conditioned options suggest alignment with clinical/regulatory success rather than short-term price action .
- No pledging/hedging disclosures identified; plan prohibits repricing without shareholder approval .
Risk Indicators
- Legal proceedings: none material reported .
- Development and financing risks highlighted in 10-K risk factors (trial execution, capital needs, manufacturing dependencies, competition, reimbursement) .
Compensation Committee and Consultant
- Compensation Committee: Hunter, Davidson, Proehl (Chair). Independent consultant Anderson Pay Advisors engaged in 2024 to assess executive and director compensation competitiveness and alignment with shareholder interests .
Investment Implications
- Alignment: Rich’s package ties meaningful upside to Phase 3 and regulatory milestones (milestone option), with large time-based grants staggered to 2025+—incentives align with value creation from levosimendan readouts and filings .
- Retention: Severance includes single-trigger equity acceleration upon termination without cause/good reason/non-renewal, reducing retention risk yet potentially accelerating overhang if departure occurs near catalysts .
- Trading signals: December 2025 exercisability of a large grant could create event-driven supply; monitor Form 4s and lock-up conditions around pivotal data windows .
- Governance: Dual role (CMO + director) with independent Chair and fully independent committees mitigates independence concerns; no separate director pay for employee directors .
- Execution risk: Pre-revenue biotech with net losses and TSR volatility; financing runway strengthened, but Phase 3 outcomes are the primary lever for pay-for-performance and equity value realization .
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