{"id":476920,"date":"2021-04-15T08:38:06","date_gmt":"2021-04-15T12:38:06","guid":{"rendered":"https:\/\/www.marketnewsdesk.com\/index.php\/indaba-issues-letter-to-the-board-of-directors-of-benefitfocus-regarding-its-unwillingness-to-agree-to-a-good-faith-settlement\/"},"modified":"2021-04-15T08:38:06","modified_gmt":"2021-04-15T12:38:06","slug":"indaba-issues-letter-to-the-board-of-directors-of-benefitfocus-regarding-its-unwillingness-to-agree-to-a-good-faith-settlement","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/indaba-issues-letter-to-the-board-of-directors-of-benefitfocus-regarding-its-unwillingness-to-agree-to-a-good-faith-settlement\/","title":{"rendered":"Indaba Issues Letter to the Board of Directors of Benefitfocus Regarding its Unwillingness to Agree to a Good Faith Settlement"},"content":{"rendered":"

<\/p>\n

\nIndaba Issues Letter to the Board of Directors of Benefitfocus Regarding its Unwillingness to Agree to a Good Faith Settlement\n<\/p>\n

Believes Lead Independent Director A. Lanham Napier Wants to Retain Outsized Influence Over the Company\u2019s Insular Board Rather Than Add One of Indaba\u2019s Independent Candidates<\/i><\/b><\/p>\n

Calls on the Company to Finally Commit to Making the Board De-Classification Proposal the First Agenda Item at the 2021 Annual Meeting, Especially Given its Willingness to Privately Concede on This Point to Indaba <\/i><\/b><\/p>\n

Makes Clear That Indaba is Committed to Taking the Necessary Steps Over the Long-Term to Improve the Company\u2019s Broken Governance and Help Enhance Shareholder Value<\/i><\/b><\/p>\n

SAN FRANCISCO–(BUSINESS WIRE<\/a>)–
\nIndaba Capital Management, L.P. (together with its affiliates, \u201cIndaba\u201d or \u201cwe\u201d), which collectively with the other participants in its solicitation beneficially owns approximately 9.5% of the outstanding common shares of Benefitfocus, Inc. (NASDAQ: BNFT) (\u201cBenefitfocus\u201d or the \u201cCompany\u201d), today issued the below open letter to the Company\u2019s Board of Directors (the \u201cBoard\u201d). As a reminder, Indaba recently nominated two highly-qualified and independent candidates \u2013 Ronald P. Mitchell and Nicholas K. Pianim \u2013 for election to the Company\u2019s Board at the 2021 Annual Meeting of Shareholders (the \u201c2021 Annual Meeting\u201d).\n<\/p>\n

\n***\n<\/p>\n

\nDear Lead Independent Director A. Lanham Napier and Members of the Board,\n<\/p>\n

\nWe are writing to you today to express our profound disappointment with the manner in which Benefitfocus has responded to our most recent attempt to achieve a settlement that supports further Board refreshment. It is confounding that the Company once again demonstrated an unwillingness to compromise with us and commit to promptly improving its insular Board. Given our status as one of the Company\u2019s largest shareholders, allowing us to have input into just one of seven directors<\/span><\/i><\/b> on the go-forward Board seems like something Benefitfocus should embrace rather than resist. We cannot understand the Board\u2019s unwillingness to agree to our latest proposal, which provided for Indaba withdrawing its nominations and accepting customary settlement terms in exchange for the Board adding Ronald P. Mitchell and committing to basic governance improvements.<\/span><\/i><\/b><\/p>\n

\nIt is important to stress that Indaba has made a significant effort to compromise with the Board in recent weeks. Despite the many issues plaguing Benefitfocus, we have not asked the Company to appoint both of our nominees or immediately establish a committee to review strategic alternatives. We proposed a consensual resolution based on the appointment of one director.\n<\/p>\n

\nUnfortunately, our discussions this week with Mr. Napier and Chief Executive Officer Stephen M. Swad have led us to conclude that Benefitfocus continues to lack the necessary respect for effective governance practices and honest shareholder engagement. In fact, there was a point in which both individuals were rejecting Indaba\u2019s input into the settlement framework without even reviewing our comments and proposed changes. This became apparent when they failed to realize that we had actually agreed to the Company\u2019s request to have Mr. Mitchell stand for election at the 2021 Annual Meeting \u2013 even if he was appointed at this point in the year.\n<\/p>\n

\nIn light of this seemingly disingenuous engagement and the onerous, off-market settlement terms demanded by the Company, we suspect that the Board never wanted to reach a resolution with Indaba. Quite frankly, we question whether any engaged shareholder or director candidate at the Company would ever agree to your \u201cbest and final\u201d terms, which include:\n<\/p>\n