"On multiple occasions in the last two months, Metropolitan Capital Advisors Inc. [a major shareholder] has asked you [Cyberonics] to tell us and the rest of the stockholders of Cyberonics Inc. when the 2006 annual meeting of stockholders will be held," read the letter to the board of directors. "Despite the company's professed commitment to stockholder democracy and good corporate governance, no date has yet been set despite the explicit requirements of Delaware law to the contrary."
The letter asked whether a delay in filing past financial results was the cause of silence on an annual meeting. It went on to accuse the board of dragging its feet in filing its financial statements and scheduling the meeting because "it does not believe this is the most propitious for the board to seek both to elect its hand-picked slate of directors and to oppose our efforts to elect new leadership."
The company has received two delisting notices from Nasdaq over its failure to file full-year financial results for the year ended April 28 and the quarter ended July 28. The Securities and Exchange Commission is in the midst of an informal investigation into the company's past stock option granting practices. Also, the U.S. Attorney's Office for the Southern District of New York has subpoenaed the company.
Metropolitan Capital owns about 1.8 million of Cyberonics' 25.2 million shares outstanding."