PHILADELPHIA, Nov. 16, 2012 /PRNewswire/ -- George Bessenyei, Gregory V. Novak and Robert S. Goggin (the "Concerned Vermillion Stockholders" or "Group") submitted on February 15, 2012 to the Corporate Secretary of Vermillion, Inc. (Nasdaq: VRML) their notice of intent to nominate two proposed directors to the Board of Directors of Vermillion for election at the Vermillion 2012 Annual Meeting of Stockholders (the "Annual Meeting"). The nominees were Gregory V. Novak and Robert S. Goggin.
The Group provided a litigation update in the form of a Letter to Stockholders today:
"Based on information the Group has discovered, on May 15, 2012, believing that defeat was imminent at the upcoming stockholder meeting that was only weeks away, the Board of Directors made a desperate attempt to disfranchise Vermillion's stockholders. They effected this plan by eliminating a contested Board seat in an emergency Board meeting. The Board's patently false justification for taking this strange step was to 'extend the cash runway'. However, as President and CEO Gail S. Page ("Page") and Chairman of the Board James S. Burns ("Burns") subsequently admitted, the actual cash savings from eliminating the Board seat was only $5,000 ( five thousand dollars) per year.
The reality is transparent: the miniscule savings that Page and Burns claimed was so important achieved nothing but reducing the number of seats up for reelection from two to one. It was an unprecedented and blatantly obvious move to further entrench the existing Vermillion directors in their positions. Members of the Group tried to reverse the elimination of the Board seat by filing suit in the Chancery Court in Delaware. However, after multiple delays, the Court dismissed the case on a procedural technicality, and thus did not reach the merits regarding the legality of eliminating the Board seat. Had the Court done so, the Concerned Vermillion Stockholders are confident that they would have prevailed…."
The full text of the letter and the court ruling will be filed with the SEC today.
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