Former Director Ralph Carlton


Former Director and Chairman of Audit Committee
(January 2011 - May 2016)

By all accounts, Ralph Carlton was a smart, experienced and capable board member.  Carlton also appears to be the only Director with sufficient character and sense of duty to stand up to Cyanotech's chairman for life, Michael Arlen Davis (MAD).

Carlton resigned shortly after the board’s receipt of Meridian’s May 6, 2016 letter to the board exposing Davis' non-disclosed investment partnership with second largest shareholder RSF,  and their secret activities to acquire a control stake of Cyanotech shares. The letter called for the board to take appropriate action with respect to Davis, in line with their fiduciary responsibilities. It seems Carlton resigned in protest once he realized the board would respond tepidly to issues raised by Meridian's letter, and thus support Davis' personal interests over the interests of Cyanotech's employees and shareholders.

The significance of Director Carlton's sudden resignation is amplified by his earlier education and professional training/experience.  Consider these particular aspects of Ralph Carlton's background:
  • Graduated Dartmouth College, summa cum laude
  • Graduated Amos Tuck School (Dartmouth)  MBA , with distinction
  • Worked in consulting at Booze Allen Hamilton for eight years
  • Worked in Mergers and Acquisitions Investment Banking at Goldman Sachs in New York City for eight years.
Mr. Carlton is obviously an educated man. He also has significantly more professional experience than Cyanotech's other board members.  We can also assume he has a good practical understanding of SEC rules and regulations given his "blue chip"  consulting and investment banking credentials.

Carlton's resignation suggests he well understood the substance and implications of Meridian's 2016 letter to the Cyanotech's board. He also seems to have understood the potential consequences of Chairman Davis' inappropriate response, especially as it relates to the potential legal exposure of individual Directors.