Date: Jan 22, 2014 Author: Don Seiffert Source: bizjournals (
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Don Seiffert
BioFlash Editor- Boston Business Journal
Advanced Cell Technology said today that Gary Rabin, who has been CEO since 2010 and has overseen the company through federal allegations of an illegal stock scheme undertaken by his predecessors, will leave that role effective immediately.
The Marlboro, Mass.-based biotech, which is developing drugs for human and animals based on human cells, said the company will immediately begin a search for a replacement. It has appointed CFO and Executive Vice President of Corporate Development Edward Myles as interim president.
A statement from Advanced Cell Technology (OTC: ACTC) did not specify a reason for the departure other than to say, "the board appreciates the work that Gary did to stabilize the company since he became the CEO in December 2010."
According to a filing with the Securities and Exchange Commission, Rabin will get seven months of severance pay at his base salary, followed by a one-time payment of $15,000. In 2012, in addition to a base salary of $525,000, Rabin earned $315,000 in bonuses. He also owns 29 million shares of the company's stock, which is currently valued at 6 cents a share.
Rabin, who is 48, was director as the company since 2007, and took over as CEO after the sudden death of William M. Caldwell, who served as CEO since 2005 and chairman since 2006. According to a civil lawsuit brought by the SEC in May 2012, Caldwell was involved in fund-raising activities in 2008 and 2009 that included the sale of "billions of shares" of penny stocks which were never registered with the SEC. The lawsuits claimed the stock-selling scheme was developed in 2006 by financier Mark A. Lefkowitz as a means to pay off debts and raise more capital, illegally claiming an exemption from the federal laws requiring that such shares be registered.
Last month, the company agreed to pay $4.1 million over the next year and a half to settle those claims, but the SEC's case against Lefkowitz and four other defendants in the case is ongoing.
Rabin had tried to get the company, which is currently sold in over-the-counter penny stocks, listed on the Nasdaq exchange again. ACT's stock has sold for less than $1 since 2006. In the last quarterly report it reported a net loss of $6.1 million for the three months that ended in September, and had cash on hand of $5.5 million.
Before serving as CEO of ACT, Rabin was managing partner of GR Advisors LLC, a hedge fund focused on the media and communications industry.
