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.