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  "documentTitle": "TransMedics (TMDX)",
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  "notes": "The slide uses a 'villain' narrative to frame the CEO's actions as potentially criminal, leveraging a recent legal precedent to build credibility.",
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      "kind": "callout",
      "text": "Press coverage - first conviction for 10b5-1 plan abuses",
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      "text": "Stepping outside of a pre-arranged plan is highly unusual and aggressive, especially when the options are not expiring.",
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      "text": "Ex-Ontrak chairman was accused of abusing trading strategy that usually shields executives against suspicions of insider trading",
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      "text": "The sell-side was in “shock” at the Q3 miss – the CEO, perhaps not so much. Despite “absolutely, categorically” asserting nothing was wrong, his trades suggest the opposite. He appears to have been in quite the hurry, stepping outside of his open 10b5-1 plan on 8/21 and 8/22 to monetize 45,000 non-expiring options, generating a net pre-tax profit of $7MM – right in the middle of Q3. He stepped outside of the same plan prior to that in May. Stepping outside of a pre-arranged plan is highly unusual and aggressive, especially when the options are not expiring. It is also high risk. The DOJ recently obtained its first conviction for abuses related to 10b5-1 plans, against an executive accused of misusing his plan and trading based on confidential information.",
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      "text": "Source: Scorpion Capital analysis and estimates; TMDX SEC filings; https://www.orrick.com/en/Insights/2023/03/DOJ-Brings-First-Criminal-Charges-for-Trades-Under-a-Rule-10b5-1-Plan; https://www.wsj.com/finance/regulation/jury-convicts-milken-protege-terren-peizer-of-insider-trading-7c78ba2a",
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      "text": "Jury Convicts Milken Protégé Terren Peizer of Insider Trading",
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