CNS
Response Provides Update Regarding Dissident Stockholder/Former CEO
Costa
Mesa, CA – July 9, 2009 – CNS Response, Inc. (OTCBB: CNSO) (the “Company”) is
issuing this press release to provide its stockholders with updated information
regarding Len Brandt, the Company’s former CEO, and the events surrounding his
attempts to hold a special meeting of CNS stockholders.
As
discussed in the Company’s July 1 press release, Mr. Brandt sent multiple
mailings of a “Notice of Special Meeting of Stockholders of CNS Response, Inc.”
purporting to call meetings on June 30, 2009 and July 3,
2009. Although July 3 was a federal and Delaware state holiday, Mr.
Brandt provided his proxy and other proxies to his attorney, who arrived at the
office of the Company’s registered agent in Dover, Delaware (the announced
location of the purported meeting), discovered that the office was closed for
the holiday and then attempted to call the purported meeting to order in the
hallway outside of the office and adjourn the meeting when it became clear that
the necessary quorum to conduct business was not present. CNS’s
counsel was present to object to the attempt to call the purported meeting, the
attempt to adjourn the purported meeting, and other matters.
“A number
of messages have been delivered to stockholders which are confusing,
inconsistent, and fall short of the minimum SEC and state
law standards for proper notice and disclosure. For CNS to be
successful, we need to focus our resources on the short-term objectives laid out
in our quarterly update, and eliminate any other distractions. That's why
we've taken steps to schedule a proper annual meeting in September, and we will
continue to communicate with stockholders on the Company's progress in the
interim,” CNS Response CEO George Carpenter commented.
Mr.
Brandt did not attend the purported meeting in person, either to vote his own
shares or the proxies he claims to have or to be available to discuss his
proposals, the identity and qualifications of his purported director nominees or
any details of his proposed plans for the Company with any interested CNS
stockholders who may have tried to attend the meeting in person. In
contrast, CNS Response CEO George Carpenter stood ready outside of the purported
meeting to speak with any interested CNS stockholders who may have tried to
travel to Dover on the holiday.
The
Company believes that Mr. Brandt’s actions on July 3 are further evidence of his
plans to disrupt the Company and disenfranchise other CNS
stockholders. By attempting to hold his purported meeting on a
holiday, when he knew many CNS stockholders would be unlikely to attend in
person, and, additionally, by not providing a mechanism for stockholders to vote
by proxy, Mr. Brandt showed his lack of interest in ensuring that the views of
all CNS stockholders are represented.
CNS
believes that the notices of the purported special meetings do not comply with
its Bylaws or Delaware law, that the actions of Mr. Brandt’s appointed proxy at
the purported meeting on July 3 were
similarly flawed, and as a result any meeting conducted pursuant to those
notices would not be in compliance with Delaware law or federal securities
laws. In CNS’s view, all of these actions appear to be an attempt by Mr.
Brandt to pre-empt the Company's Annual Meeting of Stockholders, which the Board
has scheduled be held in September 2009.
Based on
certain filings made by Mr. Brandt with the Securities and Exchange Commission,
CNS believes that he may send out another meeting notice in the future in an
attempt to call a meeting of stockholders or may attempt to take certain actions
by written consent of a majority of CNS stockholders. The Company
reiterates that any additional communications from Mr. Brandt or the members of
his group or the persons acting with him to CNS stockholders do not come from or
reflect the opinions or views of the Company, are not communications from the
Company or the Board of Directors and have not been authorized by or consented
to by them.
Additional
Information and Where to Find It
This
release may be deemed to be solicitation material in respect of the matters to
be considered at the Company’s 2009 Annual Meeting of Stockholders and/or the
purported special meeting called by Mr. Brandt or his purported solicitation of
written consents. The Company intends to file a proxy statement with the
Securities and Exchange Commission (“SEC”). CNS SECURITYHOLDERS ARE URGED TO
READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE
FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. CNS Security holders will be able to receive the proxy
statement and other relevant documents free of charge at the SEC’s Web site at
www.sec.gov or from the Company at 2755 Bristol Street, Suite 285, Costa Mesa,
CA 92626.
Participants
in Solicitation
CNS and
its directors and executive officers and other members of management and
employees may be deemed to be participants in the solicitation of proxies in
respect of the matters to be considered at the Company’s 2009 Annual Meeting of
Stockholders and/or any purported special meeting called by Mr. Brandt or his
purported solicitation of written consents. Information regarding the interests
of the Company’s directors and executive officers in the proxy contest will be
included in its definitive proxy statement.
About
CNS Response
Today,
most physicians are able to base treatment on objective test data, such as EKGs,
MRIs, blood tests, etc. Broadly speaking, such advances have not yet
come to those physicians practicing psychiatry.
CNS
Response has developed a patented data-analysis capability that, with the help
of a simple, non-invasive EEG, will analyze a patient’s brain waves and compare
the results to an extensive patient outcomes database. The process produces a
rEEG® report providing a psychiatrist with guidance to personalize medication
regimens for a patient, based on the patient’s own brain physiology. To read
more about the benefits this patented technology provides physicians, patients
and insurers, please visit the CNS Response website,
www.cnsresponse.com.
Safe
Harbor Statement Under the Private Securities Litigation Reform Act of
1995
Except
for the historical information contained herein, the matters discussed are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. These statements
involve risks and uncertainties as set forth in the Company's filings with the
Securities and Exchange Commission. These risks and uncertainties could cause
actual results to differ materially from any forward-looking statements made
herein.