Dear Tom: (TAmick@aldagen.com)

Without any prompting, but in your prepared statement, you made a very special point about DSCO now having a new team assembled to forge ahead into the future. Upon further probing by a concerned shareholder about this characterization, you admitted that there had not been any changes in personnel.
The implication was that your new leadership replacing the old of Dr. Capetola was and is sufficient enough to motivate the DSCO team into a new direction.

Clearly, there have been several performers in the Company. Charles F. Katzer is notable in his efforts in bringing the Totowa manufacturing operation (at great expense, I might add) up to grade. In the same vein, another relatively new addition, Gerald J. Orehostky, SVP Quality Operations, is to be commended as well.
And most of us would not fault the scientific efforts of Robert Segal, MD., apart from his rubber stamping Dr. Capetola’s NOT employing the BAT (mandated by the FDA since 1998).

However, on the financial and legal side, there have been some gross atrocities committed against the interests of the shareholders, not once or twice, but on a continual, ongoing basis. It is in this arena that we shareholders demand the removal of both John G. Cooper as EVP and David L. Lopez, EVP.

They were hand-picked by Robert J. Capetola. With him they have been responsible for the financial demise of Discovery Laboratories. With Capetola, they both wrote and rubber-stamped a few schemes which enriched Dr. Capetola while the stock price dropped and screwed the shareholders simultaneously. They have written and executed continual stock dilutions to undermine the shareholders rather than address the operating and oversight responsibilities that executives at their level should be doing. Only Kingsbridge and a handful of executives have benefited from these dilutions with more stock options. Every CEFF hit has massacred the shareholder. Yet you propose more of the same.

It is clear from the recent proposals drafted by Cooper and scrutinized by Lopez, that again, there is no sign of change in terms of Financial or Legal, that agrees with your “New Team”. The proposal which weakens the power of shareholders to participate in important Company changes is preposterous. The one to give blanket authorization for the issuance of 200,000,000 more shares is incredulous: You and the Board expect existing shareholders to rubber stamp this proposal is absurd. The resultant effect of this proposal was to yield on the day this was submitted to the SEC, a decline from $1.15 down to $.64. Clearly this price decline is not a vote in favor of these amendments to the Corporate Charter. Please explain how your proposals are a benefit to the shareholder without using John Cooper’s double-speak as a reference.