MONTREAL, April 18, 2013 /CNW Telbec/ - In a press release issued on April 15, 2013, Diagnocure Inc. ("Diagnocure" or the "Corporation") announced that a shareholder has submitted three nominees for election as directors of the Corporation at the shareholders meeting to be held on April 29, 2013.
Indeed, on April 9, 2013, representatives of a group of highly discontent and concerned shareholders met with those of Diagnocure's management and board of directors and advised them of their intention to have three nominees of their own elected as directors of the Corporation with a view to giving the newly-elected board and management a mandate to clearly focus on maximising shareholder value. This group of shareholders, which is constituted of Dr. Michael Rosenman, Mr. Todd Axelrod and a certain number of friends and family members who collectively hold more than 15% of Diagnocure's outstanding shares, strongly believes that the current and past directors have failed in their attempt to increase shareholder value. As a matter of fact, the Corporation's shares on the Toronto Stock Exchange have lost more than 95% of their market value since their December 2004 high. The Corporation's own management proxy circular dated March 11, 2013 indicates in the performance graph appearing on page 13 that a $100 investment in Diagnocure's shares on October 31, 2007 was worth less than $20 on October 31, 2012. Over the past few years, the Corporation's financial assets have been seriously depleted, millions of dollars having been spent on executive compensation without any tangible results. The discontent shareholders also believe that, contrary to the Corporation's assertion in its recent press release, the current board lacks balance and that it is made up almost exclusively of scientists and lacks members with a business background.
The discontent shareholders therefore intend to "abstain" from voting in favour of management's nominees and incumbent directors and to vote in favour of the election of their own nominees, Messrs. Paul Guay, Hans Mäder and Pierre Dozois.
Diagnocure's recent press release mentions that the current directors control approximately 5% of all outstanding shares. It fails to mention that the four incumbent directors other than Mr. Fradet own less than 0.03% of all outstanding shares.
The discontent shareholders also intend to vote against the Advance Notice By-Law Resolution proposed by management. They strongly believe that this by-law is abusive of basic shareholder rights and contrary to the provisions of the Quebec Business Corporations Act.
Mr. Paul Guay has been a chartered accountant since 1974 and has several years of experience in business management. Over the last six years, he has been involved as a consultant in many business turnarounds and reorganizations. He usually obtains his mandates form institutional investors, major creditors, boards of directors or the courts, which brought him to serve as a director or officer of endangered or insolvent companies with a view to leading them out or through their dire times.
Mr. Hans Mäder was President and Chief Executive Officer of Ambrilia Biopharma (formerly known as Procyon Biopharma Inc.) from March 2006 to April 2007. He also served as Chairman, President and Chief Executive Officer of Procyon from 1999 to March 2006. While at Procyon, Mr. Mäder conducted the company's TSX listing and raised over $92 million, including first-time investments from major Quebec-based venture capital firms. He also completed out-licensing deals with leading pharmaceutical partners. He is now acting as a consultant for various biotech and pharma companies in North America.
Mr. Pierre Dozois has been a senior partner with BCF llp since 1997. He completed his studies at the Faculty of Law of the University of Montréal and obtained his MBA from the Harvard Business School in 1970. His current practice is mainly focused on mergers and acquisitions and on public and private financing, including in the life-sciences industry. Mr. Dozois has been a member of several boards of directors of both private and public companies, as well as charitable and non-profit organizations.
If elected to the board, the discontent shareholders' nominees intend to take all necessary steps to maximize shareholder value for the benefit of all shareholders.
Unless otherwise noted, the information concerning the Corporation in this press release has been taken from or is based upon publicly available documents or records on file with Canadian securities regulatory authorities and other public sources. Although the Concerned Shareholders do not have knowledge that would indicate that any such information is untrue or incomplete, the Concerned Shareholders do not assume any responsibility for its accuracy or completeness, or for any failure by the Corporation to disclose publicly events or facts that have occurred or that may affect the significance or accuracy of any such information.
SOURCE The Highly concerned shareholders of Diagnocure