SAN DIEGO--(BUSINESS WIRE)--The Board of Directors of Senomyx, Inc. (“Senomyx” or the “Company”) (NASDAQ: SNMX), a leading company using proprietary taste science technologies to discover, develop, and commercialize novel flavor ingredients for the food, beverage, and flavor industries, today mailed a letter to shareholders in connection with the Company’s upcoming 2017 Annual Meeting of Shareholders to be held on May 11, 2017. The letter urges shareholders to protect their investment in Senomyx by voting FOR all seven of the Company’s director nominees – Stephen A. Block, Esq., Mary Ann Gray, Ph.D., Michael E. Herman, John Poyhonen, Kent Snyder, Daniel E. Stebbins, and Christopher J. Twomey – at the upcoming Annual Meeting.
The full text of the letter follows:
March 29, 2017
At the Annual Meeting of Shareholders on May 11, 2017, you will face an important decision that will significantly impact the future of your investment in Senomyx. You will be asked to choose between two starkly different alternatives for the Company: (1) electing the seasoned and experienced nominees that have been put forth by the Board, whose over 673,000 shares owned in the Company demonstrates true alignment with all shareholders, or (2) putting your investment at significant risk by handing complete control of the Board to a slate nominated by a dissident group that only recently purchased 300 shares of the Company.
In making this important decision, we urge you to consider the following points:
Senomyx is intensely focused on successfully executing on a robust strategy to drive revenue growth and long-term value for shareholders
Senomyx has seen strong year-over-year revenue growth, with commercial
revenues up 31% to $9.2 million in the fiscal year ended December 31,
- Commercial revenues delivered high gross margins at 88% during 2016.
The Company has worked to successfully transition business development
to non-exclusive licenses, opening new doors to value development.
- Senomyx has secured over $275 million in development funding including $18 million in R&D funding commitments from PepsiCo to support the Company’s Natural Sweet Program, as recently announced on September 30, 2016.
- Discussions are ongoing with approximately 20 companies to secure additional R&D funding.
Senomyx has achieved revenue growth in direct sales and implemented
initiatives to extend its reach in the market place.
- Q1 2017 direct sales are more than double the previous highest-sales quarter since inception of the initiative.
Senomyx has advanced its lead natural high intensity sweetener into
the development phase to address food and beverage companies’ desire
to offer great tasting, lower calorie products.
- Senomyx discovered this novel sweetener using our proprietary technology in monk fruit and it has been introduced under the common or usual name of siratose.
- Upon regulatory authorization, siratose will provide Senomyx with market access to the estimated $100 billion global sweetener market.
Senomyx has also focused on expense reductions and implemented a
restructuring in December of 2016 – this resulted in a reduction of
headcount of 17 full-time employees at an annualized savings of
approximately $4 million.
- The Company has narrowed the focus of its sweet taste R&D efforts to the Natural Sweet Program in response to market trends.
The dissident group is not aligned with your best interests and lacks relevant experience
Despite seeking 100% control over the Board, and therefore complete
control over the Company, the dissident group:
Owns a de minimis stake – just 300 shares, acquired for the first
time in December 2016 and January 2017 – evidencing essentially
zero alignment with shareholders or incentive to create value for
- The dissidents, as a group, initially purchased 400 shares, but one dissident group member sold 100 shares for a $16 profit.
- Has offered nothing to the rest of our shareholders except for an uninformed board with absolutely no industry experience.
- Has failed to articulate any specific plans for the Company – meaning that if they succeed in their self-serving takeover attempt, they would be leaving Senomyx – and its shareholders – without any clear direction.
- Owns a de minimis stake – just 300 shares, acquired for the first time in December 2016 and January 2017 – evidencing essentially zero alignment with shareholders or incentive to create value for the Company.
Their actions to date suggest they may not have a genuine interest in
this Company or its Board.
- The dissident nominees did not reach out to Senomyx prior to submitting their nominations, demonstrating no inclination to work constructively with the Company.
- In the nomination notices originally submitted to the Company by the dissidents, they sought to nominate 11 directors when the Board at that time had only 8 seats.
- The nomination notices also indicated that the dissidents did not even intend to solicit enough proxies to elect their director candidates.
- None of the dissidents’ nominees possess applicable industry experience, nor is there evidence they would bring relationships or professional networks to the Senomyx Board that could help drive the Company’s growth and partnerships.
Furthermore, the dissidents’ nominees lack independence from each
other and have a history of interlocking relationships, having served
on other Boards together in the past.
- We believe that investors should be concerned by the connections among the dissidents and the evidence suggesting they are simply using activism as a tool to obtain short-term opportunities to the detriment of long-term investors.1
Your Board is aligned with all shareholders’ best interests and has the right industry, operational and financial experience needed to successfully oversee the Company and protect your investment
- Your current Board members have many decades of director and executive leadership experience in public and private companies across an array of industries, including food and beverage, flavor and ingredient, pharmaceutical, and life sciences.
Your current Board members are aligned with the best interests of ALL
- The current Board owns over 673,000 shares with current directors purchasing over 67,000 shares in 2017.
- The current Board continues to leverage their invaluable industry knowledge and relationships to help the Company develop and implement a strategic plan that has already started to yield results on the path to long-term value creation for all shareholders.
We believe that electing our proposed slate of highly-qualified nominees for the Senomyx Board is the best choice to protect your investment in Senomyx and prevent a group that owns less than 0.00001% of stock from gaining control of your Company.
Senomyx’s current Board and management are successfully executing against a strategic plan designed to build long-term value for all our shareholders, and we are deeply aligned with your best interests.
Your current Board has a robust strategic vision for the Company and has the right experience to execute against it. The dissident group does not.
VOTE FOR YOUR BOARD’S NOMINEES ON THE WHITE PROXY CARD TODAY.
DO NOT SIGN ANY GOLD PROXY CARD SENT TO YOU BY CONCERNED SHAREHOLDERS AND NOMINEES OF SENOMYX.
The Board of Directors of Senomyx, Inc.
1 For example, (1) Lee Keddie, Benjamin Large and David Pointer served together on the CompuMed, Inc. (OTC: CMPD) Board. See the 8/12/16 Quarterly Report: https://www.otcmarkets.com/financialReportViewer?symbol=CMPD&id=158568; (2) Charles Gillman, Barry Igdaloff and Robert Pearse served together on the Novation Companies Inc. (OTC: NOVCQ) Board. See the 4/29/16 Def14A: https://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=11348243#DEF14A10453003_04292016_HTM_EXECOFFICERS; (3) Lee Keddie and David Pointer were nominees on a dissident slate nominated by VCM in respect of the 2015 Annual Meeting of Stockholders of CUI Global, Inc. (NASDAQ: CUI): https://www.sec.gov/divisions/corpfin/cf-noaction/14a-8/2015/leedkeddie072715-14a8-incoming.pdf; and (4) Lee Keddie, Charles Gillman, Barry A. Igdaloff and Benjamin E. Large are presently nominees on a dissident slate for election as directors at Birner Dental Management Services, Inc. (OTC: BDMS): https://www.sec.gov/Archives/edgar/data/707388/000092189517000638/sc13d09271021_03082017.htm.
About Senomyx, Inc.
Senomyx discovers novel flavor ingredients and natural high intensity sweeteners that allow food and beverage companies to create better-for-you products. Under its direct sales program, Senomyx sells its Complimyx® brand flavor ingredients, Sweetmyx®, Savorymyx®, and Bittermyx®, to flavor companies for use in a wide variety of foods and beverages. In addition, Senomyx has partnerships with leading global food, beverage, and ingredient supply companies, which are currently marketing products that contain Senomyx's flavor ingredients. For more information, please visit www.senomyx.com.
If you have any questions or require any assistance with respect to voting your shares, please contact the Company’s proxy solicitor at the contact listed below:
470 West Avenue
Stamford, CT 06902
Shareholders Call Toll Free: (800) 662-5200
Banks and Brokers Call Collect: (203) 658-9400
Important Additional Information
Senomyx, its directors and certain of its executive officers will be deemed to be participants in the solicitation of proxies from Company shareholders in connection with the matters to be considered at the Company’s annual meeting of shareholders scheduled to be held on May 11, 2017. The Company has filed a definitive proxy statement and a WHITE proxy card with the U.S. Securities and Exchange Commission (the “SEC”) in connection with its solicitation of proxies from Company shareholders. COMPANY SHAREHOLDERS ARE STRONGLY ENCOURAGED TO READ THE PROXY STATEMENT AND ACCOMPANYING WHITE PROXY CARD AS THEY CONTAIN IMPORTANT INFORMATION. Information regarding the identity of participants in this solicitation by the Company, and their direct or indirect interests, by security holdings or otherwise, is set forth in the proxy statement and other materials filed by the Company with the SEC. Shareholders will be able to obtain the proxy statement, any amendments or supplements to the proxy statement and other documents filed by the Company with the SEC for no charge at the SEC’s website at www.sec.gov. Copies will also be available for no charge at http://proxy2017.senomyx.com, by writing to the Company at 4767 Nexus Centre Drive, San Diego, California 92121 or by calling the Company’s proxy solicitor, Morrow Sodali, at 1 (800) 662-5200.
Information presented in this communication contains forward-looking statements within the meaning of the Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) and the Private Securities Litigation Reform Act of 1995. All statements relating to events or results that may occur in the future, including, but not limited to, the development, growth and expansion of the Company’s business, the Company’s intent, belief, or current expectations, primarily with respect to the Company’s future operating performance, and the product the Company expects to offer and other statements regarding matters that are not historical facts, are forward-looking statements. Forward-looking statements generally can be identified by words such as “may,” “will,” “could,” “anticipate,” “expect,” “intend,” “believe,” “continue,” or the negative of such terms, or other comparable terminology. These statements are based on numerous assumptions and involve known and unknown risks, uncertainties and other factors that could significantly affect the Company’s operations and may cause the Company’s actual actions, results, financial condition, performance or achievements to be substantially different from any future actions, results, financial condition, performance or achievements expressed or implied by any such forward-looking statements. Those factors include, but are not limited to, (i) general economic and business conditions; (ii) changes in market conditions; (iii) changes in regulations; (iv) actual or potential takeover or other change-of-control threats; (v) the effect of merger or acquisition activities; (vi) changes in the Company’s plans, strategies, targets, objectives, expectations or intentions; and (vii) other risks, uncertainties and factors indicated from time to time in the Company’s reports and filings with the SEC including, without limitation, most recently the Company’s Annual Report on Form 10-K for the period ended December 31, 2016, under the heading Item 1A - “Risk Factors” and the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The forward-looking statements speak only as of the date on which they are made and the Company does not intend, and undertakes no obligation to update or publicly release any revision to any such forward-looking statements, whether as a result of the receipt of new information, the occurrence of subsequent events, the change of circumstance or otherwise, except as required by law. Each forward-looking statement contained in the Company’s proxy statement is specifically qualified in its entirety by the aforementioned factors. You are advised to carefully read the Company’s proxy statement in conjunction with the important disclaimers set forth above prior to reaching any conclusions or making any investment decisions.
YOUR VOTE IS IMPORTANT
VOTE FOR THE SENOMYX NOMINEES ON THE WHITE PROXY CARD TODAY