Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
A reply from attorney Brian O'Neill as to how the reverse split affects shares that are authorized but not yet issued:
"The authorized but unissued shares will remain the same after the reverse split. Only the number of authorized and issued shares will be reduced. In other words, the number of shares which the company had authorized but not yet issued will remain the same."
I did not hear from Brian O'Neill this week. I'll try contacting him next week.
I left a message with Brian on Friday, asking whether or not all shares (issued and unissued) will be subject to the reverse split. I'll followup next week and let you know what he says.
I received a call from attorney Brian O'Neill this afternoon.
I had sent him links to the Articles of Incorporation, the Bylaws, the Proxy Statement sent for the shareholder meeting, the Form 8-K (vote results) and copies of Brettj's email communication with Doug (posts $3447 and #3450).
Brian indicated that his research confirmed that the NYSE can decide if proposals are "routine" or "non routine". He commented that the Reverse Stock Split can be considered routine since at the time of the split there is no loss in the value of the investment (although I tend to agree with those on this board who feel it will only lead to more shorting of the stock in the near future).
He referred me to the recent case of Galena in which a Reverse Stock Split was initially proposed as "non routine". However, the shareholder meeting was adjourned without considering the proposal so that a supplemental Proxy Statement could be issued to shareholders changing the proposal to "routine". Once the shareholders were properly notified of the change, the meeting was reconvened and the proposal passed, I assume with the help of Broker non-votes.
See: https://globenewswire.com/news-release/2017/12/14/1262343/0/en/Galena-Will-Adjourn-Special-Meeting-until-Friday-December-29-2017-Urges-Stockholders-to-Vote.html
And: https://globenewswire.com/news-release/2017/12/29/1276660/0/en/Galena-Biopharma-Inc-Stockholders-Approve-Business-Combination-with-SELLAS-Life-Sciences-Group-Ltd-Board-Sets-Reverse-Stock-Split-Ratio.html
While a little disappointed, I didn't press other issues that have been addressed on this board. Brian was kind enough not to charge for his research into the question. I figured the central issue I had concerns about was essentially settled, so I thanked him for his generosity and ended the call.
(SJ, In my email to Brian earlier this week, I let him know you had emailed Francis and told Brian - I hope correctly - that your email and my inquiry were not meant to be separate cases but were part of the same one. I didn't want two separate cases costing more than necessary. I don't know what issues you raised in your email, however. If you have other concerns you want to have resolved, please let Francis know in a follow up email in case Brian suggests to him that the matter has been resolved.)
So, I am pacified for now (guns down). I remain optimistic that the science is able to save the company in spite of current management.
Thanks all, for your insightful posts.
Francis Pileggi was out of the office today but I did speak to his partner, Brain O'Neill, in their Wilmington, DE office. I gave Brian a brief description of my concerns, mainly regarding the Reverse Stock Split proposal and it's vote counting. I am emailing him some links to relevant documents. He said he would discuss the issues with Francis and they would determine if they had any conflicts of interest before agreeing to assist us.
SJ, in my email, I will let Brian know that you have emailed Francis regarding these issues. I'll let you know when I hear back from either of them.
Blairs, I thought I would check the Clinical Trials websites for a couple of the medical centers that Bio-Path claims to be working with on BP1001.
Here's a link to MD Anderson and Weill Cornell Medicine:
https://www.mdanderson.org/patients-family/diagnosis-treatment/clinical-trials/clinical-trials-index/clinical-trials-detail.ID2016-0644.html
https://jcto.weill.cornell.edu/open_clinical_trials/bp1001-in-combination-with-low-dose-cytarabine-ldac-in-patients-with-previously-untreated-aml-who-are-ineligible-for-induction-therapy
While I haven't knocked on the front door in Houston (not in my zip code), if this is an elaborate scam, one would have to believe that IT folks at these institutions are involved in the scam to create fake webpages on their clinical trials websites...I'lll let those of you more skeptical check additional trial websites if you wish.
So in my opinion they are at least pursuing what they say they are. Slowly and perhaps incompetently, but pursuing it nonetheless.
SJ, I am calling Eckert Seamans Cherin & Mellott, LLC now. Hoping to speak with Francis Pileggi.
SJ, Great stuff here. Thanks for the efforts.
I think you're right in that the proxy language will be their justification. It is the most detailed and only language that addresses these issues.
From your links, it would appear that the Reverse Stock Split is not a routine matter, and therefore Brokers cannot vote on it without clear instructions from the stock owner. The Broker Non Votes could be used to establish a quorum, but could not be counted as votes "entitled" to be cast.
A review of the vote totals shows that 86,422,923 total votes were available for proposals 3 & 4. (BTW - if my math is correct - there were 86,422,925 total votes for every other item. Somehow proposals 3 & 4 lost 2 votes?!).
It is clear from proposals 1 and 2 that there were 50,828,832 Broker Non-Votes. If what I believe is true, these cannot be considered as eligible votes for proposal 3. That would leave 35,594,091 votes entitled to be cast for proposal 3.
In their proxy statement regarding proposal 3, they indicate that "an abstention will have the effect of a negative vote", i.e. they will count as eligible votes in the denominator of the calculation. If I understand correctly, the vote calculation for proposal 3 should be:
(Votes "For") / (Votes "For" + Votes "Against" + "Abstentions")
Subtracting the Broker non-votes from their "For" total gives a total of 12,034,890 actual votes cast "For". Votes "Against" were 22,661,563 and "Abstentions" 897,638.
Proposal 3 received 33.8% of the eligible votes by this method.
This is just my take on your links...I am not an attorney. Therefore...
Yes. We should contact Francis G.X. Pileggi this morning. If he's not available, we should try to find someone else in the firm who handles such matters. I'm happy to call and get this started. Or we can both make contact. As I stated in a previous post, I'm happy to share with you my contact info through their office to help us coordinate efforts if the attorney thinks this exercise has merit.
Let me know your thoughts.
The SEC website also says that the reverse stock splits would be governed by the company's Articles of Incorporation. I also reviewed this document and found nothing that I could see that was relevant.
I will of course include that in my document links should I feel inclined to proceed with a legal opinion.
Thanks.
Here is a link to the SEC's website. It basically states that rules regarding Reverse Stock Splits are governed by State Corporate Law or the corporation bylaws.
https://www.sec.gov/fast-answers/answersreversesplithtm.html
I have read through Bio-path's bylaws tonight. The phrases "broker non-votes", "reverse stock split" and "stock split" do not occur in the document. There are of course references to voting and voting procedures by the shareholders. It says nothing about what constitutes a "routine" or "non-routine" proposal.
I have searched documents regarding Delaware General Corporate Law (DGCL) but have been unable to find any specific or helpful information about Delaware law regarding Reverse Stock Splits.
Since it appears to come down to state law and/or the bylaws, I will reach out to the Delaware law firm tomorrow to ask a few questions. I have prepared a document with links to relevant information that may make it easier for an attorney to research our questions. It can be easily emailed to them if it seems reasonable to proceed.
I would hope that if reverse stock splits are governed by Delaware General Corporate Law, a Delaware attorney practicing in that area would have a pretty quick answer about what the law states about how to handle "broker non-votes". It may come down to a legal opinion on the bylaws.
(I received another call from an OpGen representative today while I was out, looking to get my proxy votes for their shareholder meeting on Wednesday regarding their reverse stock split proposal in which they clearly state that broker non-votes will count "against" the proposal. They are also a company incorporated in Delaware and traded on the Nasdaq. I could not find their bylaws online to see if they specifically stipulate how to handle such a proposal, but they clearly state in their shareholder voting material that they consider a reverse stock split to be a non-routine proposal.)
BTW, In re-reading Doug Morris' response to Brettj (post #3450), are we to conclude that Bio-Path contacted ALL brokers of shareholders who did not personally respond or give directives AND received a vote "For" proposals 3 and 4? In Bio-Path's voting results they list no "Broker non-votes" for proposals 3 and 4, instead combining those numbers into the "For" column? Can someone help me with that?
See: http://www.biopathholdings.com/wp-content/uploads/2017/12/BPTH_8K_20171227.pdf
In Section 2.9 of the bylaws it sets forth guidelines for "Inspectors of Elections" who are to oversee the "validity and counting of proxies and ballots" (2.9 (d)). Maybe shareholders have the right to see any proxy votes that brokers entered - which I imagine should include a record of the name of a broker, which shareholder they were representing, how many shares were represented and the date they were contacted and entered that vote. If it gets that far, I'll ask the attorney to interpret that section of the bylaws for me.
See bylaws here: http://www.biopathholdings.com/wp-content/uploads/2016/04/Bylaws_of_Bio-Path_Holdings__Inc__DE.pdf
I'll let you know what I find out.
I'm in as well.
Dawgster, I am gathering links to what I feel are relevant documents, many of them posted here and on Bio-Path's site. I was preparing to contact the Delaware attorney (that SJ found) on Tuesday to present him with the details, hoping he would look into our questions. I was trying to do some of the "leg work" for him to decrease the time he had to spend gathering information and therefore the cost of his services.
I will hold off on that for now until you can see if your son can take the case. Thanks for checking.
SJ and Pat, I attempted to send a Private Message on this board but as you may know I will need to create a paid subscription to do this. I had hoped to exchange contact info to facilitate finding and retaining an attorney.
I am willing to create that subscription although if we agree here on an attorney, we can share that contact info through them. Unless you have other thoughts on how best to proceed?
SJ, I think these are the crucial questions to answer. The Delaware attorney seems to have the requisite background. Since you have a good command of the issues, would you be willing to call him and ask if he could render an opinion? Even today as we head into the 3 day MLK holiday?
I would hope that the issues would be fairly straight forward to him and therefore not prohibitively expensive to get an opinion on. I would be willing to ante in the first $2000. (hoping it wouldn't cost that much) and would be happy to contact him after your initial conversation.
If he feels the Reverse Split is non routine and the Broker non votes inaccurately counted we would have him communicate that in a letter to Biopath with language suggesting a broader class action if they proceed.
I would hope he could give you an idea of what his opinion would cost and I would ask you to inquire when you make the call. If we feel it is prohibitively expensive, maybe another attorney could be sought.
As it seems like it might be easier to "prevent" the Reverse Split than "undo" it, would someone be willing to let Doug know we are soliciting a legal opinion (maybe even sharing Opgen's opinion of what a Broker non vote is)? Maybe another email from Brettj?
Given their arrogance that might prompt them to move sooner...who knows, but it might give them pause... but maybe an email would be unwise?!
BTW...I own shares in Opgen (not nearly as many as Bpth) and have not followed them as closely. I became aware of their situation because of an unsolicited call to my home phone last night from someone at Opgen. They left a message indicating they had not received my proxy votes. Apparently they are playing it straight and have hired people to track down investor phone numbers and make calls to decrease the number of outstanding Broker non votes at next week's shareholder meeting.
Apparently Biopath's December budget was stretched too thin with PN's salary to hire people for a phone bank so they made one call and got the opinion they wanted on the definition of "routine".
I have been following this board for some time and appreciate all of the informative posts. I have been a shareholder of Biopath since 2008. I recently came across information about Opgen, a company that is also hoping to avoid delisting with a reverse stock split proposal at their shareholder meeting next week.
They are also incorporated in Delaware. They submitted a Q&A with their shareholder meeting proposals. They specifically discuss what their definition of a "broker non-vote" is. They deem a Reverse Stock Split as a "non-routine" proposal, and indicate that broker non votes would count against such a proposal. As a non-routine proposal, brokers would not have discretionary authority to vote on this proposal if they had not received instructions from the stock owner.
Here is a link to the Opgen shareholder material: https://seekingalpha.com/filing/3801775
See page 3 of their Q & A section.
If an attorney agrees with this opinion, I would be happy to contribute to our cause.