Humanigen Inc (HGENQ)

[cowtown jay]

I think we do have a big fish who is trying to buy. This is how some of them do it, by driving the price into the ground, and once we hit their target price, they come up with a magnanimous offer that is 2 - 3 times the last traded price...which is where we would have been anyway if they hadn't been pushing the price lower.

You wouldn't know it by seeing how this stock is traded, but management evidently hit their goal of increasing liquidity. Less than three weeks ago, the 10-K reported:

"Our directors, executive officers, and the other holders of more than 5% of our common stock together with their affiliates beneficially owned approximately 50.7% of our common stock as of March 5, 2021."

pg 83

https://www.sec.gov/Archives/edgar/data/1293310/000121465921002990/hgen342110k.htm

Considering the number of entities holding 4.99%, or less, of our stock, this is cutting majority ownership pretty close. However, that ownership percentage can be increased to whatever level is necessary to ward off a hostile takeover, since we have sufficient Authorized Shares that could be issued to insiders.

Would the company accept a bid of 2-3 times the last traded price? Afterall, 3x is what the analysts are projecting. Not likely. But it could depend on what a potential buyer would pay for the preferred shares, of which 25M are permitted. I don't think Durrant and Chappell would do that to us, but I was affected once before when the executives sold common shares to a buyer for no premium, and I'm sure they profited handsomely on selling their preferred shares.

"In addition, our Charter permits the Board to issue up to 25 million shares of preferred stock with such powers, rights, terms and conditions as may be designated by the Board upon the issuance of shares of preferred stock at one or more times in the future. Specifically, the Charter permits the Board to approve the future issuance of all or any shares of the preferred stock in one or more series, to determine the number of shares constituting any series and to determine any voting powers, conversion rights, dividend rights, and other designations, preferences, limitations, restrictions and rights relating to such shares without any further authorization by our stockholders. The Board’s power to issue preferred stock could have the effect of delaying, deterring or preventing a transaction or a change in control of our company that might otherwise be in the best interest of our stockholders."

pg 86