OCALA, Fla.– AIM ImmunoTech Inc. (NYSE: American AIM) today announced that the Delaware Court of Chancery has denied Jonathan Jorgl’s motion for a mandatory preliminary injunction that sought to require the AIM Board of Directors (the “Board”) to accept his director nominations and include his nominees on a universal proxy card for the upcoming Annual Meeting of Shareholders (the “Annual Meeting”).
As previously announced, the Board unanimously determined that Mr. Jorgl’s director nominations did not comply with AIM’s bylaws and are invalid. The Court concluded Jorgl and his group “failed to show that [Jorgl’s Nomination] Notice complied with the bylaws.” As such, any director nominations made by Mr. Jorgl will be disregarded, and no proxies or votes in favor of his purported nominees will be recognized or tabulated at the Annual Meeting – which will be held as planned on November 3, 2022.
In reaching its decision, the Court recognized that Jorgl’s nomination notice failed to disclose arrangements and understandings among a “web of individuals [working] together to bring Jorgl’s nominations forward.”1 The Court noted the following:2
- “Other than describing a potential agreement for Chioini and Rice to reimburse certain costs, Jorgl did not mention any arrangements or understandings with Tudor or Xirinachs in his nomination notice… [T]he evidence put forward by [the Board] indicates that Jorgl’s notice was—at best—misleading.”
- “The limited record before me, however, suggests that the directors concluded a clandestine plan was afoot. I cannot say that they were wrong or that they acted unreasonably.”
- “Equity cannot bless the perverse incentives that would be created if nominating stockholders could avoid disclosure requirements through purposeful ignorance.”
The Court’s ruling also supports AIM’s contention that the Activist Group intended to hide its true backers, Franz Tudor and Michael Xirinachs, both convicted criminals, as well as the motivations of the Activist Group:3
- “The facts read like a game of telephone. Tudor, desiring to take control of the board, asked Lautz to nominate Chioini (and another individual). When Lautz failed, Tudor, Chioini, and Xirinachs regrouped to find another stockholder to be the public face of their effort. Chioini asked Rice to run alongside him, and Rice asked Jorgl to become a stockholder. Jorgl then bought shares and transferred them into record name with the help of Xirinachs. Rice promised Jorgl he would not be on the hook for any expenses, and Jorgl submitted his nomination notice to AIM. Xirinachs and Chioini then formally engaged counsel and Xirinachs officially agreed to provide funding.”
- Members of the Activist Group “engaged in advance planning towards a common end: to find an AIM stockholder who would transfer shares into record name and serve as the “face” of their nomination. That stockholder was Jorgl.”
- “Jorgl first learned of AIM just days before buying stock when his surfing buddy Michael Rice, who desired a seat on AIM’s board, asked Jorgl to buy shares for the purpose of nominating him.”
- “The evidence also indicates that Tudor’s and Xirinachs’s actions went beyond loose discussions about the nominations. Their actions appear purposefully directed toward a shared goal of taking control of the Board. They were coordinated and constructed over a period of weeks.”
- As to Xirinachs’s plans for AIM, the Court noted that Xirinachs referred to Jorgl’s slate as “our slate” and stated: “The way I hope this all plays out is we get control of AIM . . . we continue to look for opportunities to either acquire, (to spin off at a later time), license technology, or possibly merger with.”
Thomas K. Equels, M.S., J.D., Executive Vice Chairman of the Board, CEO & President, commented:
“We are gratified by the Court’s decision and believe it is a victory for all shareholders. The Court has vindicated the Board’s determination that the Activist Group includes individuals with deeply checkered pasts and was formed with the purpose of taking over the Board while deliberately hiding the identities, criminal records and motivations of those involved from the rest of our shareholders.
We can now look ahead and focus on our strong momentum building upon the positive results in published data from preeminent cancer centers that we are now seeing from our clinical trials. We have already made significant progress in recent years, and especially over the past year and a half, repurposing our lead drug, Ampligen, into oncology, and we see significant important opportunities and milestones ahead.
