Mosaic ImmunoEngineering is a nanotechnology-based immunotherapy company developing therapeutics and vaccines to positively impact the lives of patients and their families.

Free
Message: Forgive the past
Reply New Message
Prev Message Back To Forum Threaded View Next Message

This past SHAM, that exact Proposal was placed on the Proxy and passed by Shareholders by a huge margin of 3:1. The BOD wrote a written opposition to on the Proposal in the Proxy, and then when it passed, they publicly refused to enact it.

The actual language:

Mr. Boyajian’s Proposal and Supporting Statement

“WHEREAS, the Board of Directors (“Board”) of Patriot Scientific Corporation (“Company”) have no Company policy requiring any PTSC stock ownership by Directors or Executive Officers;

WHEREAS, up until as recently as January 2011, the Company had two Board members who served for over a combined 40 months, yet owned no Company stock;

WHEREAS, our current CEO/CFO/Board member has been a Senior Executive for over 3 years, and owns no Company stock;

WHEREAS, the price of PTSC stock currently trades around 8 cents, has averaged 11 cents for the past 12 months and 17 cents for the past 24 months, yet no current PTSC Director or past or present Executive Officer, has purchased stock in over two years; meanwhile, they continue to receive annual non-stock cash compensation at levels comparable to those at companies ten times our size;

THEREFORE, RESOLVED:
That Stockholders direct the Board to take all actions necessary to adopt guidelines to enforce the spirit and intent of the proposal requiring directors and senior executives to purchase company stock in non-company loaned monthly cash allotments, each month, without waiver, with a monthly base amount equal to at least 2% of their individual total annual compensation, for a period not to exceed sixty months, until such time as their individual expenditures equate to stock value in the company of at least 5 times their individual total annual compensation (including bonuses); with purchases to commence within 60 days after proposal passage.
Supporting Statement
Patriot Scientific is a company in need of assuring investors it is capable and viable as an investment; yet it’s BOD and Executives demonstrate little evidence of tangible confidence personally.

Notable investment advisors indicate significant equity stakes by the Leadership of small companies is among the primary signs to determine Leadership’s confidence in their corporate strategy, and ability to successfully execute it. Having an appropriate amount of “skin in the game” is among the most basic indicators of “interests” by Leaders being aligned with the interests of Company investors. Leadership shouldn’t be “paycheck players”, but have sizable self-paid stock positions at risk, and vulnerable to the results of their own corporate decisions.

Most public companies have Stock Purchase and Retention Requirements for Executives and BODs; 68% NASD, 86% NYSE, 79% S&P500 (*fwCook). Not only must they own stock, but they must own and hold stock valued at many multiples of their annual compensation levels. Patriot has no such requirements. PTSC’s cash payouts to Officers and BOD members has been at the level of companies many times our size; yet even with our pennies stock price, we still permit zero stock ownership by Leadership.

PTSC’s current CEO/CFO/BOD member has received $1,200,000, cash, since 2007; but owns no PTSC stock. Two former recent BOD members served a combined 40+ months, were paid $250,000, cash; but owned to PTSC stock. Two current 9 and 10 year core BOD members paid themselves a combined $1,100,000, cash, over the last five years, but together only own 1/3 of 1% of the Company’s stock; and haven’t purchased any PTSC stock in almost three years.

11
www.fwcook.com, www.issgovernance.com , www.ayco.com , (among others) conduct surveys about mandatory stock ownership levels. Companies report requiring CEOs to own stock valued as high as 25x, to as low as 1x their annual compensation. The majority of companies require 5x compensation; ISS considers 5x as “Standard”.

PTSC’s had ample opportunity to impose stock ownership requirements. We need to end the current Company attitude of indifference, where the BOD and Executives are not even required to own one share of PTSC stock; and replace it with a policy that binds the interests of Leadership with investors, signals a change away from insider apathy, and sends an unmistakable message about Leadership’s commitment to succeed.

Stockholders are urged to vote FOR this mandatory “aligning of interests” proposal.”
.
11 Recommendations
Reply New Message
Prev Message Back To Forum Threaded View Next Message
Share
Share
New Message
Please login to post a reply