Protagenic Therapeutics Inc. (PTIX)

[buckhunter102001]

Interesting reading...if you get the time

http://www.realcolegiocomplutense.harvard.edu/PresJavGut.pdf

If the controller obtains sufficient shares to get to 90% voting control of the target , it would then execute a
short-form merger, which does not require a
shareholder’s vote, in order to eliminate the
remaining minority shareholders.

IMO, the above was the original plan...But oops, retail traders bought up the float unexpectedly...not possible now as a short term goal anyway. But mark this post...they ARE buying back shares into the trasury to reduce the float IMO


http://lsr.nellco.org/cgi/viewcontent.cgi?article=1289&context=harvard_olin&sei-redir=1&referer=http%3A%2F%2Fwww.google.com%2Fsearch%3Fhl%3Den%26source%3Dhp%26q%3Dprivate%2Bcontracting%2Bin%2Bfreezeout%2Bmerger%26gbv%3D2%26oq%3Dprivate%2Bcontracting%2Bin%2Bfreezeout%2Bmerger%26aq%3Df%26aqi%3D%26aql%3D%26gs_l%3Dhp.3...547.7765.0.7890.39.19.0.19.5.0.344.2684.0j16j1j1.18.0...0.0.iKI822ii6zQ#search=%22private%20contracting%20freezeout%20merger%22

b. Influencing the target’s value
A second way in which a controller might engage in an opportunistic tender offer freeze-out is by influencing the value of the target, which would then be reflected in the target’s market price that sets the baseline for the freeze-out tender offer price. John Coates summarizes the three categories of this kind of behavior: underinvestment in positive NPV projects; investment in negative NPV projects; and shirking managerial responsibilities. Each of these three categories can be further divided into reversible value reductions and nonreversible
value reductions. Value reductions that are fully reversible are difficult to come by in the real world, but are at least theoretically possible: consider the case of a one-time positive NPV (Net Present Value) project, for which the only question is whether to implement the project before or after the freeze-out. If the project is not completely transparent to the marketplace, a controller might rationally delay this investment until after the freeze-out, in order to reap the full benefit rather than sharing the benefit with the minority. This value diversion would be difficult to detect, and, even if detected, would likely be protected by the business judgment rule, particularly if there were some plausible basis for the delay (e.g., reduced risk from delay).

Hmmmm...So, if I had a Spyder and it was worth a ton of money would I get more value if I announce it BEFORE or AFTER a tender offer to retail investors? If I take my company private by giving shareholders what they BELIEVE is a fair price, then I don't have to worry about regulatory disclosure when I sell my valuable Spyder to a buyer. The phrase Spyder sold for an undisclosed amount" works just fine in this case.

But again, I say they won't risk missing an opportunity to make BIG MONEY by lowballing retail shareholders. We may not get what the insiders get in the long run but we will get a fair price IMO.