RVX 2023 BOD Vote results June 26 2023

Following are some rough thoughts on votes. I don’t have time to do further calculations at this time but have fun with the data if you choose. I look forward to everyone’s thoughts.

Introduction

The voting results for the BOD passed us by with only 1 or 2 posts referencing them. In fact the results were very interesting and indicative of the frustration felt by an increasingly large group of shareholders.

Without having access to the actual voting results by shareholder I was only able to draw some broad conclusions from the data but the data does provide some insight.

Findings

Withhold Votes Trend

The number of “withhold” are a reflection of the dissatisfaction shareholders have of each member of the board of directors. The higher the percentage the higher the level of dissatisfaction with that board member’s performance.

Studies in the USA conducted by law firms and investment consultants shed insight into what levels of “withhold” votes reflect serious problems with BOD performance. (see end of this post)

Levels of 10% “withhold” votes are deemed to reflect serious dissatisfaction with a director and it is often found these measures do not reflect a just a specific director but tend to apply to other BOD members.

Withhold votes are a reflection of dissatisfaction of performance so I have used this terminology.

There has been a steady and significant increase in dissatisfaction with the performance of Don McCaffery and Shawn Lu in particular. Dissatisfaction with Don is nearing the key frustration point of 10%. Note that the 8.59% would be much higher within retail shareholders.

Dissatisfaction has increased across all BOD members but is significantly higher within McCaffery and Lu.

Keep in mind that the BoM Near Miss was announced in Sept of 2019 and the FDA BTD was announced in February of 2020 so it is interesting to note that dramatic jump in dissatisfaction did not occur until roughly 18 months later. This seems reflective of the complete lack of progress post BoM including bungled Covid trials and failed financings.

Number of “Withhled” Votes for Don

In June of 2021 the withheld votes for Don was relatively low at 1.7 million but it has sky rocketed by a factor of 7 times in just 2 years.

Ownership in June 2023 (a refresher)

The following table is provided for reference. I believe I incorporated the shares bought by Don a while back. I have incorporated the exempt distributions indirectly by using the number of shares outstanding on June 21, 2023 as per Yahoo.

Voting Scenarios – Who Might Have Supported Don?

I do not have access to the voting records so I can only infer/guess at who supported Don. However, just by using arithmetic’s we can draw some clear conclusions.

There was 122,884,287 votes “for” Don. I think it is fair to assume that both Hepalink and ORI Capital supported Don.

From this one can conclude that Eastern abstained from voting. Also, CTS China Fund and NGN Capital probably did not support Don.

Who Did Not Support Don

While there are mathematical possibilities my guess is that most “withhold” votes came from retail shareholders. This implies that the percentage of “withhold” voters is fair beyond the 10% threshold.

1. Too close to the 11.5 million to be likely I think.

Participation Rates

While the number of votes received increased this year the % participation declined.

My Brief Conclusions

1)    This, as is well known, is a very tightly held club controlled by Hepa, ORI, Don and Dr Wong.

2)    Other major shareholders including Eastern, NGN Capital, Protair-X Canada, CD Ventures seem to have become passive with regards to Resverlogix.

3)    Dissatisfaction with the BOD and specifically Don is growing rapidly.

My Comment

While I agree with Buckeyes that it is nice to see a plan and it is nice to see some thinking outside the box, having been in this investment for 13 years I think it is extremely improbable that this plan will be executed successfully. It’s a pipe dream but at least Don will get to explore the middle east and a bit more of Africa this year.

That being said I remain long because of the science and if Pinnochio does pull a rabbit out of a hat (like the financing of BoM2) this stock should jump to the $2.50 to $5 range immediately.

Congratulations to voters. There is a very clear, growing expression of dissatisfaction with Don. Keep the trend going. By next year we may be able to oust this guy.

Happy Canada Day.\

Toinv

Some external USA based research perspective.

MONEY

AUGUST 15, 2012 8:40 PMUPDATED 10 YEARS AGO

Unhappiness runs deep when shareholders withhold votes: study

By Emmanuel Olaoye

4 MIN READ

WASHINGTON (Reuters) - Shareholders who choose to “withhold” their vote for a corporate board member are more dissatisfied than it may initially seem, according to a study released Wednesday by two corporate governance organizations.

The study, conducted by GMI Ratings and commissioned by the Investor Responsibility Research Center Institute (IRRCi), concluded that a higher-than-average level of withheld votes in a board election shows that shareholders may not only be dissatisfied about the nomination of an individual director but with the board as a whole.

The IRRCi is a non-profit corporate-responsibility group, based in New York, and GMI Ratings is a corporate-governance information company.

The study looked at 175 cases in which a majority of shareholders opposed director nominees between July 1, 2009 and June 30, 2012. The companies were among the 3,000 largest in the United States, but smaller companies in that group accounted for 80 percent of the cases of majority-shareholder vote withholding.

The average level of withheld votes in a director’s election is 5 percent; companies should be concerned when the level in an election exceeds 10 percent, said Gladman, who is GMI Ratings’s director of research. She encouraged boards to engage in more dialogue with their shareholders.

“I’m hopeful that companies will start to see that and start to pay attention to any levels that are above the average level,” Gladman said. “If I was a corporate secretary I would be asking: why is that happening?”