A Message to Equus Stockholders from the Committee to Enhance Equus
May 25 2010 - 8:30AM
Business Wire
The Committee to Enhance Equus, collectively owning 11.4% of the
outstanding shares of Equus Total Return, Inc. (NYSE: EQS), today
issued the following statement related to the results of the
Company’s Annual Meeting of stockholders:
The results of the Annual Meeting of stockholders confirm that a
substantial percentage of Equus stockholders are disappointed by
the 65% decline in the company’s stock price. We are deeply
grateful that Equus stockholders took an active interest in the
proxy contest and that our slate of highly qualified nominees
received approximately 39% of the total votes cast at the annual
meeting. This represents a significant voice that cannot be
ignored.
The election results were very close. The incumbent board spent
an extraordinary amount of shareholder money to entrench themselves
and elect four directors from Versatile/Mobiquity to represent its
9.28% stake in the Company. We also believe that the Company
conducted the meeting in a manner intended to discourage personal
attendance and voting by shareholders. We are particularly troubled
by the Company’s refusal to count the votes cast in favor of our
slate by a registered holder of 257,600 shares who was improperly
denied access to the meeting until after the polls were closed. If
this stockholder had been permitted to attend the meeting and cast
his vote in favor of our slate, as he desired, we would have
received approximately 42% of the total votes cast. Despite these
concerns about the integrity of the process, we have concluded that
further contest of the 2010 board election is not in the best
interests of the Company or its shareholders.
As the returning incumbent directors and the four new
Versatile/Mobiquity directors begin their one year terms as
directors of Equus, we ask that all Equus stockholders continue to
actively monitor the actions of the board and the performance of
the Company. The Committee’s website and its materials remain at
www.enhanceequus.com. In the coming year, we urge you to hold the
board accountable to deliver on its professed commitment to
increasing shareholder value and to reverse the deterioration in
both the stock price and the net asset value, which declined
approximately 37% in 2009 alone. Specifically, we expect the board
to (i) immediately initiate a formal search for an experienced CEO
with fund management experience, (ii) reduce grossly excessive fund
administrative costs and third party professional fees and expenses
to a level appropriate for the size of the Company, (iii) seriously
consider reducing the size of the board to five directors, which
would be appropriate for the size of the Company, and (iv) commit
to appropriate corporate governance practices. On an individual
level, we ask each director to align their interest with that of
all stockholders, and to evidence their sincere commitment to
Equus, by making a meaningful personal investment in the Company’s
stock.
Thank you again for your support of our efforts on behalf of all
Equus stockholders.
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