TORONTO, May 9, 2013 /CNW/ - Today the group of concerned shareholders
of Bioniche Life Sciences Inc. ("Bioniche") led by William (Bill) M.
Wells, former Chief Executive Officer of Biovail Corporation, and Greg
Gubitz, former General Counsel and Senior Vice President of Corporate
Development at Biovail Corporation, announced their profound
disappointment that the board of directors of Bioniche has resorted to
employing unacceptable stalling tactics in rejecting Mr. Wells'
requisition to hold a special meeting of the shareholders to replace
This rejection of Mr. Wells' requisition is consistent with the Bioniche
board's continued entrenchment of themselves and utter disregard for
the company's shareholders, the owners of the company.
The Concerned Shareholders are very disappointed that the members of the
Bioniche board would take this step to seek to entrench themselves in
the face of their dismal track record and in complete disregard of
their fiduciary obligations. The Concerned Shareholders expect that
their fellow shareholders are similarly disappointed and frustrated
with the board's actions.
In response to the technical legal points raised in Bioniche's recent
press release rejecting Mr. Wells' requisition, the Concerned
Shareholders note the following:
A Valid and Proper Requisition. The Canada Business Corporations Act specifically states: "the holders of not less than 5% of the issued
shares of a corporation…may requisition the directors to call a meeting
of shareholders for the purposes stated in the requisition". There is
no statutory requirement that a registered shareholder submit the
requisition. The requisition submitted by Mr. Wells included a sworn
affidavit from him attesting to his beneficial ownership of 5,853,322
Bioniche shares. Further, Mr. Wells has, through the Concerned
Shareholders, issued three press releases publicly attesting to his
share ownership. Mr. Wells is clearly a significant shareholder.
Purpose of the Meeting. Mr. Wells' requisition very clearly states that the purpose of the
meeting is to replace Bioniche's board. There is no statutory
requirement for a requisitioning shareholder to list its nominees at
the time of making the requisition; nor is it customary practice to do
so. The Concerned Shareholders will, in accordance with applicable law,
publish full details of their board nominees as soon as practicable
following the board's announcement of the special meeting of
The Concerned Shareholders strongly encourage the Bioniche board to act
appropriately and in accordance with its legal responsibilities. To
continue to waste the company's scarce resources on legal and advisory
fees to entrench itself is merely further evidence of a board acting in
its own self-interest and contrary to its fiduciary duties to the
company and its shareholders.
The Concerned Shareholders expect the Bioniche board to abide by the
legal requirements and call the special shareholders meeting by May
16th, the deadline under applicable law, by which the board must call a
meeting in response to Mr. Wells' April 25th requisition. If the board
fails to do so, the Concerned Shareholders will take all necessary
actions to defend their rights as Bioniche shareholders.
The Concerned Shareholders decry the board's announcement that it has
called Bioniche's annual meeting of shareholders for November 5, 2013.
Calling an annual meeting more than six months before the proposed
meeting date is nothing more than a transparent attempt to prevent
shareholders from exercising their statutory right to a timely meeting
to consider replacement of the current board members. It is artificial
and a sham. The Bioniche board is simply trying to frustrate
shareholder democracy and deny shareholders their statutory rights.
The Concerned Shareholders will not wait until November to have their
voices heard. Immediate action must be taken to reverse Bioniche's
decline. Bioniche's Q3 financial results released yesterday clearly
show a rapidly deteriorating situation. The company's revenue in the
quarter declined by 12% compared to the same period last year and the
average monthly cash burn rate has increased to $1.4 million per month.
The company is hemorrhaging and rapidly running out of resources.
Further delay is extremely prejudicial to shareholder value. The
current board has had years to turn the situation around and has failed
to do so. It is time to let the shareholders have their say - before it
is too late.
Once again a chart demonstrating the abysmal performance of management
and the board is attached. It demonstrates why those managing Bioniche
will do anything to avoid facing the company's shareholders.
Bioniche's board and management have lost all credibility. These latest
stalling and entrenchment tactics are just one more desperate attempt
to save their positions without regard to the best interests of the
company and its shareholders.
It is time for new direction and new leadership.
PDF available at: http://stream1.newswire.ca/media/2013/05/09/20130509_C4992_DOC_EN_26546.pdf
SOURCE: William (Bill) M. Wells and Greg Gubitz
For further information: