Migenix reaches agreement with shareholder, CEO resigns

By Lisa Kerner

Charlotte, N.C., Aug. 11 - Migenix Inc. reached an agreement with shareholder DJohnson Holdings Inc., avoiding a proxy contest at its annual meeting on Oct. 31.

Dr. James DeMesa agreed to resign as president and chief executive officer Migenix effective immediately. Bruce Schmidt has been appointed as interim president and CEO, according to a Migenix news release.

Migenix said it agreed to reduce the size of its board of directors to five members, from seven. David Scott, DeMesa, Steven Gillis, Colin Mallet and Michael Abrams resigned.

The new board will be comprised of two members from the incumbent board, Pieter Dorsman and Alistair Duncan, and DJohnson nominees:

• Douglas Johnson, chief executive officer and president of Canfund Ventures Corp.;

• Bruce Schmidt, founder and CEO of a University of British Columbia spinoff biotechnology company; and

• Andrew Rae, CEO and president of iCo Therapeutics Inc.

"As a result of a detailed assessment of Migenix's current financial condition, the opportunities which lie ahead, and the standby commitment for a rights offering that has been made by DJohnson, the board determined that a settlement with DJohnson was in the best interests of shareholders," DeMesa said.

Johnson said the new board is committed to raising funds for the company "in a manner that is fair to all shareholders" and that could include a rights offering for $2.5 million.

In July Migenix announced it would hold the Oct. 31 shareholder meeting at the request of a group of shareholders led by Johnson.

As previously reported, Johnson owns approximately 5% of Migenix's outstanding common shares, but has beneficial ownership of and/or voting control of a total of 14,042,400 shares, or 15% of the total issued and outstanding common shares of Migenix.

Migenix is a clinical-stage developer of drugs for infectious and degenerative diseases based in Vancouver, B.C., with U.S. operations in San Diego.

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