NEW YORK, April 18, 2017 /PRNewswire/ -- Periam
Limited and certain other participants (collectively, the
"Concerned Shareholders"),* the third largest group of
shareholders of EnerNOC, Inc. (NASDAQ: ENOC) ("EnerNOC" or the
"Company") with approximately 5.5% of the Company's outstanding
shares, issued an open letter to its fellow shareholders of the
Company. The full text of the letter is included below:
Dear Fellow Shareholders,
On April 17, 2017 we, Periam
Limited and the other participants named therein (collectively, the
"Concerned Shareholders"), filed a 13D disclosing a 5.5% total
beneficial ownership in EnerNOC, Inc. ("EnerNOC" or the
"Company").
The immense shareholder value destruction at EnerNOC in recent
years is of grave concern to all EnerNOC shareholders. We have been
particularly shocked by management's poorly executed foray into
energy intelligence software ("EIS") and disappointed by the Board
of Directors' (the "Board") stewardship of shareholder interests as
it became clear that EIS was not progressing as originally
conceived. Since the issuance of its convertible bonds on
August 18, 2014, which pre-funded
EnerNOC's expansion into EIS, the EnerNOC share price has fallen by
over 70%. Additionally, the Company's management continued to run
the EIS unit at an undiminished annualized cash burn rate of over
$70 million† (equivalent
to over 40% of current market capitalization) for several quarters
despite flat operating metrics.‡ It is bad enough to
make an ill-advised and extremely costly strategic decision, and to
execute it poorly. It is a whole different matter to refuse to
accept one's own mistakes and to continue to throw good money after
bad.
As things stand, the Concerned Shareholders believe that EnerNOC
shares are deeply undervalued and that there exist numerous
opportunities to significantly increase shareholder value,
including operational and financial improvements as well as
strategic initiatives. We appreciate that the Board has engaged
advisors to conduct a strategic review of the Company's assets and
believe that this was a necessary first step toward realizing the
value we believe is inherent in the Company's businesses. However,
we are highly skeptical that this value will be fully realized
under EnerNOC's current corporate governance structure.
To that end, the Concerned Shareholders have been in an active
dialogue with management and the Board to address the various
value-enhancing opportunities we have identified, as well as, to
implement enhanced Board-level oversight more appropriate for the
Company's current situation and more reflective of EnerNOC's
current shareholder base.
As such, the Concerned Shareholders nominated two highly
qualified candidates for the Company's Board on February 24, 2017. Each of our nominees has
directly relevant experience in effectuating key value-enhancing
operational improvements. Their deep investment experience in both
private and public markets will also provide EnerNOC shareholders
additional protection against similar value-destroying strategic
decisions by management in the future. In our view, they will add
tremendously relevant perspective to the ongoing strategic review
process and should therefore be appointed immediately:
- Gregory Share – Mr. Share is an
independent investor focused on investments in software and
financial services companies through his investment firm, Ambina
Partners, LLC. Mr. Share has twenty years of prior private equity
experience, having served in various capacities for Moelis Capital
Partners, Fortress Investment Group ("Fortress") and Madison
Dearborn Partners. Mr. Share earned a B.S. degree in Economics from
the University of Pennsylvania, The
Wharton School.
- Jeffrey M. Tuder – Mr. Tuder is
the Managing Member of Tremson Capital Management, LLC, a private
investment firm focused on identifying and investing in securities
of undervalued publicly-traded companies. Mr. Tuder has twenty
years of private and public equity investment experience, having
served in various capacities for KSA Capital Management, LLC, JHL
Capital Group, LLC, CapitalSource Finance, LLC , and Fortress
Investment Group. Mr. Tuder has served as a Director of a number of
private companies and is currently a Director of MRV Communications
(NASDAQ: MRVC), a publicly-traded
networking equipment company, where Mr. Tuder also serves as
Chairman of the Audit Committee. Mr. Tuder received B.A. in English
Literature from Yale University.
We have provided the Board access to our nominees (including
through in-person interviews). However, we are disappointed that
our private conversations with the Board have not yielded results
and are concerned that the strategic review process may unfold
without the benefit of our nominees' input, leaving us with no
option but to communicate our concerns publicly.
In addition, the Concerned Shareholders urge the Company to
immediately improve its overall transparency to investors through
enhanced financial disclosure. For example, it is unacceptable that
gross margins and operating expense lines are not broken out by
business unit. Similarly, shareholders have the right to understand
the composition of the approximately $20
million of corporate unallocated expenses. Absent this
information, EnerNOC's shareholders are at a severe disadvantage in
assessing any proposal that may be put to them as a result of the
strategic review. Furthermore, without increased disclosure,
shareholders are less able to adequately assess the performance of
each of EnerNOC's businesses on an ongoing basis.
Finally, we encourage the Board to ensure that the ongoing
strategic review is conducted with utmost transparency to ensure
that the long-term interests of EnerNOC's shareholders are upheld.
In particular, we trust that in the event any officer or director
intends to participate in a "take-private" or other strategic
transaction, the Company will implement stringent measures to
ensure all decisions of the Company will be made by independent
directors receiving advice from independent advisors of their
choice.
*
*
*
*
*
About the Concerned Shareholders:
- Periam Limited is an investment vehicle incorporated in the
British Virgin Islands whose
ultimate beneficiaries are owners of Alfanar, a diversified, global
power group headquartered in Riyad, Saudi
Arabia.
- Dominik Dolenec is the key
principal of Emona Capital, a London-based firm focusing on special
situation and disruptive technology investments. Mr. Dolenec was
formerly a portfolio manager at Elliott Advisors (UK) Limited where
he specialised in activist investments, merger arbitrage and
distressed credit.
- For additional information see "Certain Information
Concerning The Participants" attached hereto.
We remain interested in constructively engaging with the Company
to seek improvements for the benefit of all EnerNOC shareholders,
while reserving our rights to act.
*
*
*
*
*
Sincerely,
Periam Limited
Mishal Almutlaq
Dominik Dolenec
Warning Regarding Forward Looking Statements
THIS PRESS
RELEASE CONTAINS
FORWARD LOOKING
STATEMENTS. FORWARD LOOKING STATEMENTS CAN BE IDENTIFIED BY USE OF
WORDS SUCH AS "OUTLOOK", "BELIEVE", "INTEND", "EXPECT",
"POTENTIAL", "WILL", "MAY", "SHOULD", "ESTIMATE", "ANTICIPATE", AND
DERIVATIVES OR NEGATIVES OF
SUCH WORDS OR
SIMILAR WORDS. FORWARD LOOKING
STATEMENTS IN THIS PRESS RELEASE ARE BASED UPON PRESENT BELIEFS,
EXPECTATIONS, ESTIMATES AND PROJECTIONS REGARDING THE COMPANY
AND PROJECTIONS REGARDING
THE INDUSTRY IN
WHICH IT OPERATES. HOWEVER, FORWARD
LOOKING STATEMENTS AND THEIR IMPLICATIONS ARE NOT
GUARANTEED TO OCCUR
AND MAY NOT OCCUR
AS A RESULT OF VARIOUS
RISKS, REASONS AND
UNCERTAINTIES. FURTHER, SUCH RISKS,
REASONS AND UNCERTAINTIES COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY. ACCORDINGLY, YOU
SHOULD NOT RELY
UPON FORWARD- LOOKING STATEMENTS AS A PREDICTION OF
ACTUAL RESULTS AND ACTUAL RESULTS MAY
VARY MATERIALLY
FROM WHAT IS
EXPRESSED IN OR INDICATED BY THE
FORWARD-LOOKING STATEMENTS.
CONCERNED SHAREHOLDERS CONTACT:
Dominik Dolenec
Phone: +44 20 7129 1244 info@emonacapital.com
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
Periam Limited together with the other participants named herein
(collectively, the "Concerned Shareholders"), intend to file a
preliminary proxy statement and an accompanying proxy card with the
Securities and Exchange Commission ("SEC") to be used to solicit
votes for the election of its slate of director nominees at the
upcoming 2017 annual meeting of shareholders of EnerNOC, Inc. (the
"Company").
THE CONCERNED SHAREHOLDERS STRONGLY ADVISES ALL SHAREHOLDERS
OF THE COMPANY TO READ THE
PROXY STATEMENT AND OTHER PROXY MATERIALS
AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT
NO CHARGE ON
THE SEC'S WEB
SITE AT
HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS
IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY
STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON
REQUEST. REQUESTS FOR
COPIES SHOULD BE
DIRECTED TO THE PARTICIPANTS' PROXY
SOLICITOR.
The participants in the proxy solicitation are anticipated to be
Periam Limited, Dominik Dolenec,
Taimur Hadi, Gregory Share and Jeffrey M. Tuder (collectively, the
"Participants").
As of the date hereof, Periam Limited may be deemed to
beneficially own 1,525,120 shares of Common Stock. As of the date
hereof, Mr. Dolenec may be deemed to beneficially own
97,780§ shares of Common Stock. As of the date hereof,
Mr. Hadi may be deemed to beneficially own 19,681 shares of Common
Stock of the Company. As of the date hereof, Mr. Share may be
deemed to beneficially own 31,800** shares of Common
Stock of the Company.
* For a description of the Concerned Shareholders
see pages 3 and 6 of this release.
† Even before allocation of corporate unallocated
expenses.
‡ Subscription Software ARR and ARR/Customer have
stagnated since Q4 2015.
§ Includes 41,500 shares of Common Stock held in a
trust for which Mr. Dolenec is a beneficiary and the sole
settlor.
** Mr. Share's holdings are through Ambina Partners,
LLC, a wholly-owned Delaware
limited liability company of which he is the sole Member.
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SOURCE Periam Limited