Echo Therapeutics Mails Letter to Shareholders; Urges Not to Vote Platinum's Gold Proxy Card
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.
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