Echo Therapeutics Mails Letter To Stockholders; Urges Stockholders Not To Vote Platinum's Gold Proxy Card
PHILADELPHIA, April 29, 2014 /PRNewswire/ -- Echo Therapeutics, Inc. (NASDAQ: ECTE), a medical device company developing its Symphony® CGM System as a non-invasive, wireless continuous glucose monitoring system, today announced that it has mailed the following letter to stockholders in connection with the proxy contest that has been threatened at Echo's 2014 Annual Meeting of Stockholders by a dissident stockholder group led by Platinum Management (NY) LLC:
April 29, 2014
Dear Fellow Stockholder:
Echo Therapeutics, Inc. has recently filed revised proxy materials with the Securities and Exchange Commission (SEC) in connection with Echo's 2014 Annual Meeting of Stockholders, including a preliminary form of a revised proxy statement and a preliminary form of a revised WHITE proxy card. Echo's need to file these revised proxy materials arose as a result of it being notified that a dissident stockholder group led by Platinum Management (NY), LLC intends to wage a proxy contest against Echo in connection with Echo's 2014 Annual Meeting.
Rebuffed in their attempt to have Shepard M. Goldberg appointed to the Board earlier this year, the Platinum Group now intends to nominate him for election to the Board at the 2014 Annual Meeting in opposition to our highly qualified and very experienced director, Robert F. Doman. Mr. Doman has been a member of the Board since March 2013. Since last August, Mr. Doman has been serving as Echo's Executive Chairman and Interim Chief Executive Officer. Mr. Doman brings to Echo's five-member Board over 30 years of executive level, international and domestic management, business development, commercialization, product development and strategic planning experience with specific concentrations in medical devices and pharmaceuticals.
The Platinum Group's purported nominee, Shepard M. Goldberg, is a first cousin and long-time business associate of Michael M. Goldberg, M.D., a current member of the Board. Dr. Goldberg was appointed to the Board on February 27, 2014 as a designee of Platinum Partners Value Arbitrage Fund L.P., a Platinum affiliate and a member of the Platinum Group, which has a right to designate a director pursuant to a stock purchase agreement. Platinum Partners named Michael M. Goldberg, M.D. as its designee after the Board informed Platinum Partners that, after interviewing Shepard M. Goldberg and reviewing his background and the information he submitted to Echo, the Board's Nominating and Governance Committee determined that Shepard M. Goldberg did not meet the Board's criteria for Board membership.
Given Michael M. Goldberg, M.D.'s historical relationship with the members of the Platinum Group and that he was appointed to the Board as Platinum Partners' designee, together with the fact that he is the first-cousin and a longtime business associate of Shepard M. Goldberg, the Board has formed a Special Committee, composed of all Board members other than Dr. Goldberg, to respond, on behalf of Echo, to the Platinum Group's proxy contest.
We look forward in future communications to detailing our view of Shepard M. Goldberg's qualifications and contrasting in detail the track record and experience of Robert F. Doman, the Board's recommended and highly qualified and very experienced nominee, with the track record and experience of Shepard M. Goldberg, the Platinum Group's nominee, including Shepard M. Goldberg's two decades of experience in the pool supply business and his experience thereafter, for close to a decade, working side-by-side with, and reporting directly to, his cousin Michael M. Goldberg, M.D.
Given the significant opportunities that we believe lie ahead for Echo and the good faith and open-minded manner in which the Board has constructively engaged with Platinum and sought to avoid a proxy contest, we are disappointed that the Platinum Group is now pursuing a costly and disruptive proxy contest to facilitate its self-interested agenda. We believe that all Echo stockholders, including Platinum and its affiliates, would best be served by allowing management to focus its time and energy and Echo's financial resources on the business and accomplish our objective to bring a commercially viable product to market rather than be distracted by a costly proxy contest. Accordingly, we strongly urge the Platinum Group to end their proxy contest before it permanently damages Echo's prospects.
Your Board urges you NOT to sign or return the gold proxy card or voting instruction form that the Platinum Group may send to you, even as a protest vote against the Platinum Group or its nominee. If you sign a proxy card sent to you by the Platinum Group, however, you will retain the right to change your vote. Only the latest dated proxy card voted will be counted.
We look forward to communicating with you further in the coming weeks.
/s/ VINCENT D. ENRIGHT
Vincent D. Enright
Chairman, Special Committee of the Echo Board of Directors
Stockholders are advised that they may receive proxy solicitation materials from the Platinum Group or other persons or entities affiliated with the Platinum Group, including an opposition proxy statement and gold proxy card. Stockholders are strongly urged NOT to sign or return the gold proxy card or voting instruction form that the Platinum Group may send to them, even as a protest vote against the Platinum Group or the Platinum Group's nominee. If any stockholder signs a gold proxy card sent to them by the Platinum Group, however, such stockholder retains the right to change his or her vote. Only the latest dated proxy card voted will be counted.
As earlier announced, to allow sufficient time for stockholders to receive and review Echo's revised proxy materials, the date of the 2014 Annual Meeting has been postponed and a new record date for determining stockholders entitled to notice of, and to vote at, the 2014 Annual Meeting will be set. Echo will announce both such dates prior to its mailing to stockholders of the revised proxy materials.
Echo is being advised in connection with the proxy contest by Morgan, Lewis & Bockius LLP and Alston & Bird LLP. Laurel Hill Advisory Group, LLC is serving as Echo's proxy solicitor.
About Echo Therapeutics
Echo Therapeutics is developing the Symphony CGM System as a non-invasive, wireless, continuous glucose monitoring system for use initially in the critical care setting. A significant longer-term opportunity may also exist for Symphony to be used in the hospital beyond the critical care setting, as well as in patients with diabetes in the outpatient setting. Echo has also developed its needle-free skin preparation device, the Prelude® SkinPrep System, as a platform technology to enhance delivery of topical pharmaceuticals.
Cautionary Statement Concerning Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to expectations, plans or prospects for Echo that are based upon the current expectations and beliefs of Echo's management. The words "will," "may," "designed to," "outlook," "believes," "should," "anticipates," "plans," "expects," "intends," "estimates," "forecasts" and similar expressions identify certain of these forward-looking statements including statements regarding our revised proxy materials. These forward-looking statements are subject to certain risks and uncertainties that could cause actual events to differ materially from those expressed or implied by such forward-looking statements. Those risks and uncertainties include, but are not limited to, risks related to the actions of Platinum Management (NY) LLC and other activist stockholders, including the amount of related costs and the disruption caused to business and financing activities by these actions. Other risks and uncertainties that may cause actual events to differ materially from the statements we have made herein are identified and described in more detail in Echo's filings with the SEC, including, without limitation, its Annual Report on Form 10-K for the year ended December 31, 2013, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K. The forward-looking statements in this Press Release are made as of the date hereof. Notwithstanding changes that may occur with respect to matters relating to any forward looking statements, Echo does not expect to, and disclaims any obligation to, publicly update, amend or clarify any forward-looking statements whether as a result of new information, future events or otherwise. Echo, however, reserves the right to update such statements or any portion thereof at any time for any reason.
Important Additional Information
In light of the recent filing with the SEC by Platinum Management (NY) LLC of an opposition proxy statement indicating it intends to solicit proxies for Echo's 2014 Annual Meeting of Stockholders (including any adjournments, postponements or reschedulings thereof, the "2014 Annual Meeting"), Echo has filed revised proxy materials with the SEC, including a preliminary proxy statement and a revised preliminary form of WHITE proxy card, in connection with Echo's solicitation of proxies. STOCKHOLDERS ARE URGED TO READ THE REVISED 2014 PROXY MATERIAL (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT ECHO WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Stockholders will be able to obtain, free of charge, copies of Echo's revised 2014 Proxy Statement and any other documents filed by Echo with the SEC in connection with the 2014 Annual Meeting, when available, at the SEC's website (www.sec.gov), at Echo's website (www.echotx.com) or by directing a request to Echo Therapeutics, Inc., 8 Penn Center, 1628 JFK Boulevard, Suite 300, Philadelphia, PA 19103, Attention: Investor Relations. In addition, copies of the proxy materials, when available, may be requested from Echo's proxy solicitor, Laurel Hill Advisory Group, LLC, 2 Robbins Lane, Suite 201, Jericho, NY 11753 or toll-free at 1-888-742-1305.
Certain Participant Information
Echo, its directors and certain of its executive officers and employees are deemed to be participants in the solicitation of proxies from Echo's stockholders in connection with the 2014 Annual Meeting. Additional information regarding the identity of these participants and their direct or indirect interests, by security holdings or otherwise, is set forth in Echo's 2014 Preliminary Proxy Statement and other materials to be filed with the SEC in connection with the 2014 Annual Meeting. Such information can also be found in Echo's Annual Report on Form 10-K for the fiscal year ended December 31, 2013, filed with the SEC on March 28, 2014.
SOURCE Echo Therapeutics, Inc.