__Prescott's concerns----- are heightened by disclosures made in an August 1, 2013 investor presentation, which indicate that TCN 032 has the largest market potential of all the drugs presented for Theraclone's clinical pipeline.
---Prescott believes this BARDA funding denial calls into question two critical components used by PharmAthene's Board to help justify the merger: access to non-dilutive government funding; and a significant worldwide market opportunity for one of Theraclone's most developed drugs.
--Given the apparent importance of TCN 032 funding to the value of Theraclone, and by extension the entire "merger of equals" concept, Prescott reiterates its opinion that all shareholders should vote AGAINST all five proposals being submitted to a vote of PharmAthene stockholders at the scheduled December 3rd special meeting.
I find no evidence of a lawsuit as suggested by this topic heading. Perhaps "Shareholders may sue if merger is approved" is the intended meaning of this threads heading.
Interesting implications for SIGAs battle with PIP if the merger is defeated.
On November 26, 2013, a lawsuit was filed in the Court of Chancery of the State of Delaware against each of the individuals on PharmAthene's Board of Directors (the "PharmAthene Directors") and PharmAthene by Prescott Group Capital Management, L.L.C., Prescott Group Aggressive Small Cap, L.P., Prescott Group Aggressive Small Cap II, L.P., and Prescott Group Aggressive Small Cap Master Fund, G.P. (the "Plaintiffs") on their own behalf and derivatively on behalf of PharmAthene (captioned Prescott Group Capital Management, L.L.C., Prescott Group Aggressive Small Cap, L.P., Prescott Group Aggressive Small Cap II, L.P., and Prescott Group Aggressive Small Cap Master Fund, G.P. v. John M. Gill, Brian A. Markison, Joel W. McCleary, Eric I. Richman, Jeffrey W. Runge, Mitchell B. Sayare, Derace L. Schaffer, and Steven St. Peter, and PharmAthene, Inc., a Delaware Corporation) (the "Litigation"). The complaint alleges that the PharmAthene Directors individually breached their fiduciary duties by failing to adequately investigate certain possible federal tax ramifications relating to net operating losses and tax credit carryforwards ("NOLs") prior to the Board of Directors' vote on the merger and subsequently failing to attempt to renegotiate the Merger to preserve those possible benefits. The complaint also alleges that PharmAthene and the PharmAthene Directors engaged in corporate waste by entering into the Merger Agreement with disregard for the value of its NOLs and subsequently failing to attempt to modify the Merger Agreement. The complaint further alleges failure to disclose all material facts regarding the Merger. Plaintiffs seek preliminary and final equitable relief, damages, costs, reasonable attorneys' fees and expenses and other such relief. PharmAthene believes that the complaint improperly characterizes the efforts of the PharmAthene Directors and is without merit, and intends to vigorously defend the Litigation.