Enzo Biochem, Inc. (NYSE:ENZ) today commented on Harbert’s press release in reaction to Enzo’s announcement that it is providing its shareholders with additional choices:
“We are surprised by Harbert’s public comments yesterday in reaction to our Tuesday announcement that we would welcome Harbert’s two nominees onto the Board and provide shareholders the choice to benefit from the added perspective and diversity of an expanded Board. Harbert’s assertion that the Company’s additional proposals to shareholders are “undermining the will of its shareholders” is incorrect and inconsistent with our proposals. Rather, we are making these proposals in response to specific feedback from our shareholders. Moreover, the Board has not enacted anything. It is providing shareholders the right to vote on these proposals at our Annual Meeting, which is a choice that Harbert clearly does not want our shareholders to have.
As we stated in our announcement, we have pursued a negotiated resolution with Harbert. Our agreement with Harbert was to keep the contents of our settlement discussions confidential. However, since Harbert has disclosed and mischaracterized our interactions, we believe it is necessary to correct the record. Our January 22 proposal offered to elect both of Harbert’s nominees to the Board. It was met with a response from Harbert in which they made atypical and unreasonable demands including: the position of Lead Independent Director, the Chairmanships over two of the three board committees, approval rights over additional directors and board expansion as well as forced resignations of both Enzo nominees (one immediate and one in a year). We offered Harbert the chance to provide a more reasonable counterproposal and they declined. Our inability to make progress in the negotiation, coupled with the feedback we’ve received from shareholders, fueled our determination to let shareholders decide the matter for themselves. Nevertheless, immediately after we announced our proposals on Tuesday, representatives of Enzo again reached out to Harbert to reengage in settlement negotiations. Rather than responding in kind, Harbert issued their press release.
Here are the facts:
- Our proposals to shareholders announced on Tuesday contemplate that Harbert’s two nominees will be appointed to the Board regardless of whether shareholders approve the expansion of the Board
- Harbert’s statement that a seven person Board “would be completely out of line with what is necessary for a company of this size” is inconsistent with shareholder feedback we have received requesting a more expanded and diverse Board
- Some shareholders, in addition to the Board, are concerned that with Harbert obtaining 40% of the Board Harbert’s true intent is to take control of the Company, which we believe is supported by Harbert’s extreme demands in our settlement negotiation, the tone of Harbert’s press release and its vehement objection to expanding the size of the Board
- We remain willing to engage in a genuine negotiation with Harbert. However, if a negotiated agreement with Harbert is not possible, shareholders as a whole will ultimately decide on how to constitute their Board.
Important Additional Information and Where to Find It
Enzo Biochem, Inc. (the “Company”) has filed and mailed to shareholders a definitive proxy statement and proxy supplement on Schedule 14A and accompanying WHITE proxy card with the Securities and Exchange Commission (the “SEC”) in connection with the solicitation of proxies from the Company’s shareholders with respect to its 2019 Annual Meeting of Shareholders. The Company intends to file and mail to shareholders a new proxy supplement and new GOLD proxy card Shareholders are strongly encouraged to read the Company’s proxy statement, proxy supplements, accompanying GOLD proxy card and all other documents filed with the SEC as they become available carefully and in their entirety as they contain important information.