"per the agreement Johnny Boy has to vote the way they say and he has the majority so no others votes are necessary."
That's not quite right and the difference is important.
From the agreement (which is between JB and the group and NOT binding on anyone else, including TB and MI):
1. "You will not vote your Preferred Stock or common stock to appoint yourself or any other individual who is not the President or Treasurer of the Company or a Qualified Independent Director (as defined below) as a member of the Board."
2. "....you will vote the Preferred Stock and any shares of common stock owned by you in favor of Qualified Independent Directors as, when and if, nominated by the Board or any nominating committee thereof."
3. "If you are required to vote the Preferred Stock for any reason (other than as provided above), then (x) you shall not vote the Preferred Stock with respect to the matter under consideration until the common stock shall have been voted in accordance with the Bylaws and (y) you shall thereafter vote the Preferred Stock in the same proportion as the common stock so-voted. By way of example, if stockholders holding 56% of the common stock vote in favor of the taking of an action, then you shall vote 56% of the Preferred Stock in favor of the taking of such action and 44% of the Preferred Stock against the taking of such action."
#1 prohibits JB from voting his preferred or common for anyone other than a Qualified Independent Director, as defined (with the exception of the President and Treasurer.....interestingly, they adopted that term when Rauber was President).
#2 requires him to vote his preferred and common for any nominated QIDs.
#3 covers votes other than the election of directors and lets him vote his common any way he pleases. He has to vote his preferred in the same yes/no ratio as the rest of the common is voted, so it has no effect on any outcome.
As I think I pointed out months ago, there's nothing stopping TB and MI (plus JW at the time) from appointing whatever directors they are inclined to appoint based on whatever qualifications they feel like using. They have been able to do that for a LONG LONG time, since whenever they became directors....which I believe was formalized at the last shareholder meeting in July of last year. My understanding of the By-Laws is that those appointments would stand and those directors would serve until the next shareholder meeting (the one that's pending).
Whether directors appointed by MI and TB would survive that vote is anybody's guess, but JB could not vote for them under any circumstances (unless, of course, they coincidentally met the QID definition...then he'd have to.) I did not see where JB was either precluded from or required to vote AGAINST any non-QID.
As best I can tell, if TB and MI appointed non-QID directors of their choosing and JB simply did not vote, the group would have no recourse against JB....think about that. Their "only" recourse, again as far as I can tell, would be to withhold any additional funding from the company. That possibility may be one of the primary reasons that TB and MI haven't acted independently.
As I said, they have no obligations under the agreement. JB does. At this point, if the company doesn't hire a “Recruitment Firm” from which JB proceeds to choose 5 QID's, the group's recourse is against JB. JB, however, could argue that he wasn't provided the required list from which to choose.
What a frickin' mess.
Now you've gone and done it!
