HOUSTON, Nov. 4, 2015 /PRNewswire/ -- JCP Investment
Management, LLC (together with its affiliates, "JCP"), the
beneficial owner of approximately 5.7% of the outstanding Class A
shares of Casella Waste Systems, Inc. (NASDAQ: CWST) ("Casella" or
the "Company"), issued the following statement regarding the
November 6, 2015 Annual Meeting of
Casella.
James Pappas, Managing Member of
JCP, said, "Over the course of this year, JCP has fought
relentlessly to bring attention to the (1) sustained
underperformance, (2) poor capital allocation, and (3) extremely
weak corporate governance at Casella. We are encouraged that
as a result of our campaign and the strong support we received from
our fellow stockholders, Casella has made the following positive
changes after our public announcement on April 28, 2015:
- July 7, 2015 – John Chapple stepped down as a director from the
class of directors with terms ending at the Annual Meeting (the
"2015 Class") having been on the board since 1994; Jim O'Connor, a new independent director, joined
the Board in the resulting vacancy in the 2015 Class.
- September 1, 2015 – Jim McManus stepped down as director in the 2015
Class having been on the board since 2005; Bill Hulligan, new independent director, joined
the Board in the resulting vacancy in the 2015 Class.
- September 1, 2015 – Casella
adopted a number of corporate governance changes including the
following:
- Adoption of majority vote resignation policy for only
uncontested elections, but not for contested elections;
- Adoption of stock ownership guidelines for executives;
- Adoption of policy restricting hedging and pledging
activities
- September 2015 – Casella released
earnings guidance for 2018, including:
- Commitment to a EBITDA guidance
- Commitment to a Free Cash Flow guidance
- Commitment to decrease leverage
- October 19, 2015 – Greg Peters stepped down as Lead Director;
recent addition to the Board; Jim
O'Connor, appointed Lead Director"
Pappas commented, "We are gratified to have served as the
catalyst for these positive first steps in the right direction and
are inclined to give the new Board a chance to deliver on its
promises to shareholders. In that regard we have decided to
withdraw our nomination of directors ensuring the election of the
incumbent slate. We believe this will position us well to
monitor the progress of the Board's current plan and we fully
expect shareholders to hold the Board and management accountable
for any failure to deliver on their plan - now and in the future.
Importantly, even with these big concessions, we estimate
stockholders made a strong showing of support for the election of
JCP's nominees. This strong support is a clear message: the
Board must either deliver fully on their plan or shareholders
expect to see a full strategic review process for the sale of the
Company, not just undertaken but completed in a value-maximizing
manner for Class A shareholders. JCP intends to remain a
vigilant and vocal shareholder of Casella. We will monitor
the new Board's progress executing on its commitments and we will
do whatever is necessary to protect shareholder rights and maximize
shareholder value at Casella."
"It is our hope that the Board will respond appropriately to
shareholders' strong support for JCP's platform of stronger
corporate governance by making voluntary enhancements to, at a
minimum:
(1) declassify the Board structure and allow for annual
accountability of directors;
(2) increase the representation on the Board of Class A
public shareholders who currently have approximately 80% voting
power, but only 1 of 9 Board seats (in contrast, Class B
shareholders, John and Doug Casella,
have only 20% of the vote yet have 2 of 9 Board seats)."
Pappas concluded, "One of the positive results of this process
was that it caused the directors to hear firsthand the
long-standing frustration of stockholders, and we expect that as a
result they will objectively evaluate all strategies to unlock
value at Casella. We want to thank our fellow stockholders
for their support and contribution to this long overdue and healthy
debate about the future of our Company, and encourage them to keep
up the pressure through the 2016 annual meeting and beyond so that
accountability for Casella management and the new Board continues
beyond this annual meeting."
Sincerely,
James Pappas
JCP Investment Management, LLC
About JCP Investment Management:
JCP Investment Management, LLC is an investment firm
headquartered in Houston, TX that
engages in value-based investing across the capital
structure. JCP follows an opportunistic approach to investing
across different equity, credit and distressed securities largely
in North America.
Contact:
James
Pappas
JCP Investment Management, LLC
(713) 333-5540
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SOURCE JCP Investment Management, LLC