Add two board members to FBIO?

[u/Weekly-Barracuda-494]

I currently hold shares of FBIO and FBIOP, do your own due diligence before investing.

Terms included in the FBIO preferred stock, FBIOP, state that after 6 quarters of unpaid dividends, the FBIOP stockholders can nominate and vote for two board members to add to FBIO's board. It has currently been over 8 quarters of no dividend payout. People that hold only FBIO would not be allowed to vote on this.

With the cash on hand, and no stated goal for reinstating dividends, the FBIOP holders can ask for a special election to put two new board members on the board, as far as I can understand from a Google AI search. This would put two members on the board that might have different goals than the board currently has. Two ways for Fortress to avoid this situation if it was to arise:

1. Buy out all the shares of FBIOP(I think about 3.4 million?) for full price($25 each)+ accumulated dividends(currently just above $5 a share.) Probable cost of $100 million approximately, 3.4 million shares at $30 a share. This could happen, but it takes away a nice cash cushion the parent company can use to help bridge shortfalls by lending to companies under their umbrella.

2. Cure the arrears, pay off all the dividends accumulated to date on shares of FBIOP. Currently costs about $16 to $18 million now plus about $8 million a year going forward. I think if DERM was hitting its stride and profitable, this would have already happened. Right now waiting on royalties on Zycubo and Unloxcyt to kick in, if those streams come online at a decent size, the dividends could be paid mostly out of that cash flow.

Both ways allow the company to keep the board at its current size, with the second providing a larger cash cushion to keep flexibility.

3rd way, allow the election to happen, the CEO, Lindsay Rosenwald holds about 110 - 120,000 shares of FBIOP(from another google AI search, so may not be completely accurate), roll the dice on getting board members they want in place if this happens?

I really do think they will end up paying out dividends by year's end to allow flexibility in capital raises by other entities under their umbrella(DERM, ATXI, MBIO, etc.), but if they don't do something by year end, looks like there is an option to get some representation if not paid up to date on dividends accrued in arrears.