TTMM, one of the problems may be that we do not 100% understand or know to interpret some of the documents.
If I read that 29th April 2004 Charter for Nominations of BoD candidates that is linked in PPHM Nomination web-page and that they refer to in each 10-K then I am under the impression that if someone proposed BoD candidates via a shareholder proposition before Aug 15th (2017 this year) they are correctly proposed at that level BUT not for making the ballot.
To make the ballot potential candidates MUST also pass the Nomination Committee that must then, after vetting the candidate(s), give an advise to the BoD. The BoD, although it is only an ADVICE, can do with it what they want but they can use it to hide behind. Before a court of law they say we followed the advice of a Nomination Committee (approved by shareholders) that is responsible for the vetting. The Nomination committee will refer to the Charter and claim shareholders have agreed in a well defined and in detail described procedure that must take place for the vetting.
So someone that did NOT propose there candidates before 3th April 2017 to the Nomination Committee (See Charter and assuming the BoD does NOT move the Annual Meeting back with more then 30 days) will technically receive a negative advice. The Nomination Committee will argue they follow shareholders rules and that there is no reason to bend them.
And here come the pitfalls:
A) Ronin TIMELY filed a shareholders proposition with 3 BoD candidates
B) PPHM announced they will propose 3 new candidates on top of the 4 that are in for re-election.
QUESTIONS:
1) Did RONIN file ALSO to the Nomination Committee. The Charter says that the Nomination Committee MAY NOT disclose that data and may ONLY provide advice to the BoD. But if RONIN DID file before the 3th April 2017 (and that will be disclosed by POSSIBLE acceptance of his candidates) the PROVE is delivered to US RETAIL SHAREHOLDERS that RONIN has been PLAYING US.
Why? Because it means that BEFORE 3rd of APRIL 2017 he ALREADY had candidates BoD members in order to be able to file them to the PPHM Nomination Committee. And that he did it in March while he just started to build its PPHM position. That MEANS that he was preparing the HOSTILE activities, that we saw LATER, way before having his big position. Hence he BUILD the biggest part of his position WHILE ALREADY knowing he was later going to say that WE invested in a company with a worthless BoD that they want gone and have non-working drugs that they want to stop. That is PREMEDITATED because if he believed at that time that PPHM was so worthless then he should have left it alone. So RONIN does NOT think it is worthless and the value is sees is NOT AVID IMO.
Furthermore RONIN has at least ONE candidate that is a professional BoD candidates (sits in BoD as part of a simulated unrelated 'puppet' activity) that is CERTAINLY not the qualified person we look for to replace so current said incompetence. SO I guess that guy will be vetted away.
2) PPHM announce that they are going to LOOK for 3 new Candidates BoD members and hence give away that BEFORE 3th April 2017 they CANNOT HAVE FILED to the Nomination Committee because they 2 weeks ago they didn't even know who the 3 candidates will be. So I think that, unless there is an exception in the Charter or PPHM moves the date of the Annual Meeting back for 30 days, they cannot propose ANY NEW CANDIDATES according REGULATION.
BUT...they increased the BoD by 3 (7 BoD positions now) and that decision will STAND even if the 3 PPHM candidates are REVOKED by the Nomination Committee (which they might because that guarantees the 3 committee members that are ALSO BoD members (CJ, DP and ES) that together with CEO King they can ALL be re-elected with 1 single vote.
That is NOT the case if, apart from RONIN's 3 candidates, also 3 PPHM candidates are added to the Ballot because then it becomes the 7 Highest Votes out of 10.
POSSIBLE SCENARIOS
1) RONIN candidates don't make it to the ballot (Nomination Committee procedure or didn't pass vetting) and PPHMs New candidates don't make it either.
2) RONIN candidates don't make it to the ballot (idem) but PPHM's Candidates do. (would need an ASM date move by 30 days IMO)
3) RONIN candidates MAKE it to the ballot but PPHM's NEW candidates do NOT
4) RONIN candidates MAKE it to the Ballot and PPHM's New candidates too (would need an ASM date move by 30 days IMO)
Since the 4 existing BoD members are ALWAYS making it to the ballot (unless the step down BEFORE) the following are the possible results/
#1: 4 existing members get re-elected with ONE SINGLE vote. PPHM misses 3 BoD members because they will increase the number to 7. Possibly, by lack of validly proposed and vetted candidates they might say they turned it back to 4 or they keep searching.
#2: 4 Existing plus 3 New PPHM members will form a 7 head BoD
#3: 4 Existing members get reelected with ONE SINGLE vote and 3 Ronin members get elected with whatever votes the get because there is no competition.
#4: The ONLY ballot with MORE then 7 candidates and hence the ONLY situation in which VOTING is of importance because in the 3 above situations no matter what the outcome of the vote, the BoD configuration is KNOW UP-FRONT. BUT...IN ALL CASE this will result in a 4 PPHM against 3 RONIN candidates.
CONCLUSION
If NOTHING CHANGES (no new moves by PPHM or RONIN in a timely fashion) then we will FOR SURE have a PPHM Majority (4 against 3) in the new BoD.
In MOST scenario's this will include the 3 current members we'dd like to remove (ES, DP and CJ). Only in #4 that will depend on the vote.
Because I suspect that PPHM cannot propose VALID BoD members without moving the ASM 30 days in the future I expect the PPHM candidates to be revoked. If that is the case the BoD risks a Class Action for FRAUD because PPHM (who WROTE the Charter) is supposed to know (can before a court of law not claim they did not know) that their announced candidates COULD NOT be validly vetted AND HENCE where only an EXCUSE to INCREASE the SIZE of the BoD to SECURE the re-election of the CURRENT BoD members.
Yet, if PPHM moves the ASM date (which they NEVER DID in the past) then it is CLEAR that they did it as a COUNTER MOVE to RONIN's hostilities against BoD INDIVIDUALS and NOT in the BEST INTEREST of PPHM and hence its shareholders.
To be continued.
AIMO
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