Sale of TargetRx / Option Termination

Date: September 11, 2011
To: Holders of options to purchase shares of TargetRx common stock
Subject: Option Termination Notice and Opportunity to Exercise

Dear All,

Enclosed please find and review a document entitled “Option Termination Notice and Opportunity to Exercise”. The document is self-explanatory but this email communication will highlight a few key summary points, as follows.

1. TargetRx, Inc. is in the final stages of being acquired. Once finalized, the newly merged company should provide a more robust platform for future business success and growth.

2. Proceeds from the pending transaction will first be used to satisfy certain corporate obligations including those to creditors and subsequently to preferred stockholders.

3. It is important to note that the total proceeds from the pending transaction will not be sufficient to pay the holders of the Company’s preferred stock in full. This means that funds will not be available to distribute to any shareholders of the company’s common stock.

4. As per the terms of the company’s current Stock Incentive Plan, it is a requirement that, immediately prior to the completion of the pending merger, all options to acquire shares of the Company’s common stock will become fully-vested and exercisable.

5. Accordingly, the purpose of this communication is to alert you that your options to acquire shares of the Company’s common stock are now fully vested and are exercisable. In addition, any such options that are not exercised by 10:00 am Eastern Time on Monday, September 12, 2011, will be cancelled.

6. It is most important that you recognize that all of your common stock options will be out of the money (i.e., the exercise price you would need to pay will exceed the amount payable under the Merger Agreement with respect to such shares). Therefore, while you have the opportunity to exercise your stock options by completing the election notice provided in the enclosed document, it will not make practical, financial sense to do so.

Note to all option holders: We will gather together for a brief meeting at 9:00 am on Monday morning, September 12, 2011 at TargetRx offices (address below) to reinforce the key points of this communication and answer any questions you may have that we are at liberty to discuss prior to closing of the pending merger. The sale of TargetRx will mark the beginning of an important new chapter, one in which we are hopeful that the Company’s significant assets (our products, our services and our employees!) can thrive. That is certainly our goal.


Thanks, as always, for your diligent work and loyal support.


Sincerely,


Craig Scott

 

Someone over at the ImpactRx forums says that they are the acquiring company.

http://www.cafepharma.com/boards/showpost.php?p=4071108&postcount=66

 

What was the purpose of exposing to the public our confidential internal documents. To embarass management. Is it their fault that TargetRx lost out in a two person race? You should rot in purgatory for such horrible behavior.

 

It is hard to believe that you are upset with me for posting this, not with the guys who lost the company for us and caused this fire sale. It's over and we lost, and there are 45 people here, me included, who are the losers. Shaming me for posting this kind of admits you are one of the 5 getting a payout. Shame on you instead, you don't deserve a penny and everyone here knows you made it off the sweat of our brows, you barely came to work, lost all our clients, and gave yourself and your cronies raises, shares, and a free pass to do nothing at all for the company the last year (care to talk new product sales?)

Amazing, you sell a company for 1/8 of the money invested in it, and get 2 years pay and bonus and I will be lucky to get a couple of weeks. Somehow, I don't think that I am the one that should feel shame in this affair

 

Funniest part of note from Scott to all of us is word "sincerely." He will be paid large sum for orchestrating failure, while we will get pink slips.

 

The only advice at this point is not to exercise any options or sign any documents pertaining to the sale.

 

Very sad day at TargetRX

 

Just for the record, both companies lost that two person race. The common shares given to the employees at ImpactRx were worthless as well. That is the way it is with VC backed firms.

 

Who bought targetrx

 

impactrx. they must not have looked at cancellations (amgen, gsk, bms, lilly, others) or fraudulent revenue (genzyme, astra-zeneca) or cash or revenue. nice work, craig.

 

I believe the management team SAVED the company! How much longer could the Conpany exist? Others have indicated that customers were eroding. What was the alternative option? Stay the course? Craig gave all of you a life line. Grab it and prove your net worth to the new team. And your first order of business should be to get back to work.

 

Actually I agree. Both companies have been lowering margins year over year in order to get the clients to flip.

And if any of the clients ever read these boards, reality is this is your fault for playing us against one another. You have done the same with IMS/WK(NDC)/SDI/Verispan. Soon enough, there will be no competition for you to go to, and you know what that means.... lower quality at a higher price.

 

Time to leave eary and enjoy the day before you get your pink slip.

FYI: CS has alreaday left the building.

 

FYI: Craig and Patrick left the building sometime last year and have not been back since -

Getting a tenth of the value of a company that your self-indulgence and greed destroyed is not called saving it - it's called a fire sale, and the problem is that the only things not charred are Craig and Patrick's bank accounts. For the rest of us: ashes!

Pop Quiz: What is the sum of $40 million in preferred VC investment and $10 - 20 million more (guessing) in employee options divided by a $6 million dollar sale after fees

Answer: Empty Employee Pockets, duh!

But don't worry, Craig will give us all hugs, at least all of the women

 

From all the Women at TargetRX - we do not want any hugs or pats on the head from Craig Scott.

 

Wow, he gave you pats on the head? See, chivalry is not dead.

 

What I'd like to see is a list of all current and former officers of the company that were allowed to borrow money from the company (to purchase shares during rounds of financing is how that usually works) and whether they have paid that money back. If those loans were "forgiven" without a payback, that could be something fishy that the SEC might want to look into.

For those who exercised options in the past, your shares are now worthless and you need to get a statement from the company stating such, so that you can write the loss off on this years taxes - IRS requires a formal written statement from company if the stock is private (i.e. not publically tradeable).

By the way, for what it's worth, if the company got sold for $6 million, everybody took a bath, including VCs. Last round of investors (which I think was $10 million) had rights to get all their money back before anybody got anything else, so even the last ones in took a loss.

 

I am not 100% sure but I didnt think the SEC had any bearing on private firms finances. Am I wrong?

 

We've watched him demand hugs from almost every young woman in the company- it's actually quite intimidating, stroke their hair while they sat there silently in disgust, and let loose with every raunchy innuendo and sexist joke in the book in front of our male and female colleagues on a daily basis for the last four years - no one has stood up to him in all that time, not one executive or board member, so our only hope now is that ImpactRx does the right thing and lets him go - yes, it's money for nothing, but it's goodbye and good riddance from all of us...and please don't try to stay in touch because we don't want to

 

FYI he hugs the older ones too.