Icagen, Inc. (NDAQ: ICGN) shares opened sharply higher after a large shareholder demanded changes at the biotechnology company. Xmark Opportunity Partners, which owns a 9.1% stake in the firm, disclosed a letter to the board of directors in a Schedule 13D filing with the SEC. The shareholder pointed out several actions that the company was taking against shareholders and threatened to take action against the board and seek representation if they didn’t back down.

Here’s a copy of the letter:

Xmark Opportunity  Partners,  LLC  ("Opportunity  Partners" or "we" or "us" or "our") is the sole member of the investment manager of Xmark Opportunity Fund, L.P. and Xmark Opportunity Fund, Ltd.  (together,  the "Xmark Funds").  As you are aware, the Xmark Funds are significant shareholders in Icagen, Inc. (the "Company").

As you also are aware,  on September  26, 2008,  Opportunity  Partners filed a Schedule 13D (the "13D")  announcing  its intention to evaluate  closely the  performance  of the  common  shares  of  the  Company,  including,  without limitation,  analyzing and assessing the Company's business, assets, operations, financial condition, capital structure, management and prospects, as well as the fact  that it may,  from  time to time,  evaluate  various  options  in order to attempt to influence the  performance  of the Company and the  activities of its Board of Directors.  On December 1, 2008,  Opportunity  Partners filed Amendment No. 1 to the 13D ("13D Amendment No. 1") disclosing the text of a letter,  dated November 29, 2008 ("Letter 1"), that it had sent to the Board of Directors  that detailed,  among other items,  (a) our efforts to observe a meeting of the Board of Directors,  (b) the Xmark Funds'  accumulation of the Company's common shares and (c) our  strong  belief  that an  extraordinary  transaction  is in the best interest of the Company and its shareholders.

On December 2, 2008,  just day(s) after we sent Letter 1 and filed 13D Amendment No. 1, the Board of Directors adopted a poison pill. To us, the timing of this move is curious and  disturbing  to say the least.  We strongly  believe that this poison pill will deter buyers from the Company to the detriment of the Company's  shareholders and to the benefit of existing  management.  In adopting the poison  pill,  the Board  only  reinforced  our  long-standing  belief  that management is entrenched and the Board is out of touch. Moreover, management and the Board have not recently  announced any cost-cutting  initiatives,  at a time when  companies  all over  the  world,  in every  industry,  are  cutting  costs aggressively.  And, the Company has made only immaterial changes to its material employment agreements.

After  receiving  Letter 1, the Company  offered us an  opportunity to sign a set of confidentiality  agreements to allow us to evaluate steps, if any, that  management  has taken  from a  strategic  perspective.  Unfortunately,  we believe  that the  conditions  of this offer  rendered  it hollow and  illusory. Specifically,  the Company conditioned its disclosure of the Company's strategic plans upon our (i) essentially agreeing to lock-up the shares owned by the Xmark Funds  (which we always  have been  willing to do) and (ii)  agreeing  to remain silent  in  the  public  market  (including  no  proxy  battle),  for  a  period potentially  extending  through the next annual meeting (June 2009). The Company attempted to secure our silence. The proposed  confidentiality  agreements would have  undermined a key purpose of our request -- to speak out and take action if we found that  management  and the Board are not acting  responsibly  and in the best interests of the Company's shareholders.

Rather  than walk away from the  table,  we sought  middle  ground and responded to the Company's  offer with a compromise in the  alternative:  (x) we would agree to lock up the shares owned by the Xmark Funds and remain  silent in the public market through the next annual  meeting if the Company  allowed us to attend a single  meeting  of the Board or (y) we would  agree to a lock up for a period of four (4) months,  so that we would be able to speak at the next annual meeting. In our view, this was a reasonable  compromise.  We wanted a voice; the forum  for  our  voice  -- the  marketplace  or the  boardroom  -- was up to the Company. The Company flatly rejected this proposal.

From this  experience,  we believe that  management and the Board have little or no interest in benefiting the Company's shareholders.  The Company has taken  action  to  quell  public  market  activity  in its  shares,  while  also requesting silence from its most active shareholder. We continue to be amazed by the behavior of the Board,  one that includes  luminaries such as Dr. Charles A. Sanders,  Lead Director of Genentech,  Inc., Anthony B. Evnin,  Managing General Partner of Venrock  Associates,  and Dr. Dennis B. Gillings,  Chairman and Chief Executive Officer of Quintiles Transnational Corp., but, perhaps, nothing should amaze us at this point.

Again,  please be advised that if the Company decides to raise capital in a dilutive  offering,  we will evaluate all available  options to protect the interests  of our limited  partners  and  shareholders,  including,  inter alia, commencing  legal  proceedings  against the Company to seek rescission of such a transaction and/or damages, as well as an action against the Board for breach of fiduciary duty.

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Neurobiological Technologies, Inc. (NDAQ: NTII) suspended its stroke drug development, which prompted at least one activist shareholder to demand that value be returned to shareholders. Highland Capital, which owns 17.6% of the firm, sent a letter to the board demanding that the company liquidate its assets and distribute the proceeds to shareholders. However, the company appears to be taking a different course of operation by hiring a new President and CEO.

"Following a thorough review of the interim data, it was determined that there was no group of patients in which Viprinex improved outcome, and therefore further development is not warranted," said Warren W. Wasiewski, Chief Medical Officer. "We are very disappointed that another potential treatment for this devastating disease has failed to show benefit for this patient population."

After the poor results, Neurobiological Technologies announced that it would begin reducing its workforce substantially in order to lower costs and preserve cash. However, Highland Capital learned that the company is seeking to hire a new COE and President, and that such action shows an intention to continue operations despite the lack of a viable new technology to create value in the future.

According to a Schedule 13D filing with the SEC:

Highland Capital delivered a letter to the Board requesting the expeditious wind down of the Issuer’s business. In the letter, Highland Capital expressed its belief that, due to the failure of the Viprinex program, the Issuer has no incremental value as an ongoing concern. Highland Capital expressed a strong belief that the only way to return value to the shareholders is through liquidation of the Issuer’s assets. The letter notes that the Issuer is seeking to hire a new CEO and President, and that such action shows an intention to continue operations. Highland Capital believes that the Board should immediately decide to liquidate the Issuer, and that hiring a new CEO and President is unnecessary if such action is to be taken.. Highland Capital expressly lists various assets, including cash, currently held by the Issuer which are all capable of near-term liquidation. Highland Capital asserts that it is the Issuer’s Board of Directors’ fiduciary duty to the public shareholders to liquidate these assets, wind down business, and return all proceeds to the public shareholders. Highland Capital expressed concern that the Board was considering “strategic options” to continue business which would result in the immediate degradation and eventual loss of all shareholder value.

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The market for location based GPS products is expected to increase 168% in 2008 with aggregate revenues for the sector growing by 169%, according to Gartner Research. The same research firm also predicted that the number of GPS subscribers would reach nearly 300 million with revenues expected to top $8 billion by 2011. So, what stocks should investors watch?

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