-Glass Lewis Joins ISS in Recommending
Shareholders Elect the Entire Independent Slate
EL SEGUNDO, Calif.,
June 22,
2022 /PRNewswire/ -- Eileen
Drake (the CEO of Aerojet Rocketdyne (NYSE: AJRD)) and
the other members of the Committee For Aerojet Rocketdyne
Shareholders and Value Maximization today announced that leading
independent proxy advisory firm, Glass Lewis, has recommended that
shareholders elect the entire Drake Independent Slate at the
special meeting of shareholders scheduled for June 30, 2022.
Glass Lewis is the second leading independent proxy advisory
firm to recommend that shareholders vote "FOR" the Drake
Independent Slate. As previously announced, Institutional
Shareholder Services ("ISS") has also recommended that
shareholders vote "FOR" the entire Drake Independent Slate.
Ms. Drake commented: "We are very gratified to have received
Glass Lewis' full support for our Independent Slate. We now have
the validation of the two leading independent proxy advisory firms,
and look forward to shareholders casting their vote at the
June 30th special
meeting."
In supporting Ms. Drake and her Independent Slate, Glass
Lewis made the following observations:
Drake and the Independent Slate
- "…Ms. Drake — working against challenging time constraints and
with far fewer resources than those we expect were available to the
Steel Faction — has assembled an experienced and well-rounded slate
of candidates in short order, an outcome which seems to speak
volumes to Ms. Drake's ability to attract credible, independent
nominees to her cause."
- "[W]e consider [the Drake nominees] each appear credible and
independent, with the slate collectively offering well-rounded
experience in the aerospace and defense industry."
- "[W]e note Ms. Drake is a sitting CEO who, in our view, has
already demonstrated strategic and operational credibility and
reasonable value-creation bona fides. We do not believe Mr.
Lichtenstein has been successful in reshaping that narrative, and
would, as a result, question the need for Ms. Drake to essentially
reinvent the operational wheel simply to impress the Steel Faction
at this juncture."
- "[W]e note Ms. Drake's go-forward agenda … contains a number of
favorable action items, including elimination of the executive
chair role, establishment of an independent board chair, increased
accountability in relation to ARD's underfunded pension fund and,
by virtue of the Drake Faction slate, enhanced gender and racial
diversity."
- "[T]he Drake Faction commits to considering all alternatives
prospectively available to the Company — up to and including
a prospective sale — alongside the continued pursuit of ARD's
stand-alone strategic platform. We view this framework
favorably."
Lichtenstein's Lack of Independence and
Accountability
- "[S]upport for the Steel Faction would portend a considerable
step back in terms of reliable, progressive corporate governance,
in all cases in favor of a sitting chair recently inclined to delay
shareholder votes, privately pursue personal objectives
irrespective of board directives, sensationally misrepresent key
developments and, perhaps most critically here, circumvent personal
culpability."
- "…[W]e are concerned Mr. Lichtenstein's late-stage slate change
still leaves the Steel Faction list stacked with nominees
personally or professionally proximate to Mr. Lichtenstein,
including CEO-in-waiting Mark
Tucker."
- "The larger question, however, is a pointed one that falls in
line with doubts raised throughout our commentary: if the
operational issues at ARD are so pervasive — and, to be clear, we
do not believe that they are — why then has Mr. Lichtenstein, as a
long-serving and highly compensated employee of the Company, not
previously accepted responsibility, signaled the need for change or
more aggressively posited strategies and alternatives comparable to
those included in the Steel Faction's existing materials?"
- "[T]he circumstances smack of procedural convenience, with Mr.
Lichtenstein selectively abdicating himself of his existing
responsibilities where it suits the Steel Faction campaign.
Unsurprisingly, we consider this methodology hardly signals a
willingness by Mr. Lichtenstein or his cohort to accept
responsibility for any failure to achieve the operational targets
and governance objectives contained in the Steel Faction
plan."
- "…Mr. Lichtenstein is a named executive officer who sits at the
top of ARD's summary compensation table. In absolute candor, we
remain confounded by the notion that historical critiques of
executive staff — persuasive or not — are viewed as a winning tack
by the Steel Faction. In the service of absolute clarity, we would
firmly emphasize again that this approach to accountability and
responsibility disconcertingly reinforces Mr. Lichtenstein's
willingness to shirk fault, even when his own arguments expressly
indicate he is part of the problem."
Findings of Internal Investigation on Lichtenstein's
Conduct
- "While the result of this investigative process is, in our
view, already fairly damning, we consider Mr. Lichtenstein's oddly
dismissive response and material recharacterizations are just as
problematic."
- "…Mr. Lichtenstein has continually sought to reframe his
unauthorized engagements [with CEO candidates] as, "proper
contingency planning," purportedly consistent with his duties as
executive chair. The conceptual lift here is nothing short of
heroic, as Mr. Lichtenstein seems to be extolling his own virtues
for attempting to surreptitiously circumvent board directives in a
manner which opened ARD — and, by extension, its investors — to
harm."
- "In a very damaging theme for the Steel Faction, we again find
this sets a very troubling precedent in terms of accountability,
transparency and candor, and is, in our view, nearly disqualifying
on its own."
Delaware Opinion
- "As it relates to the recent opinion issued by the Delaware Court of Chancery, it arguably comes
as limited surprise that the Steel Faction again adopts a fairly
aggressive representation of available fact patterns. … [W]e
consider a fair read of the published opinion offers a much more
muted tone with substantially less relief than was originally
sought by Mr. Lichtenstein: the court failed to find any major
violations of the TRO, failed to find defendants in contempt,
declined to invalidate any delivered proxies and declined to award
a reimbursement of plaintiff's attorneys' fees."
- "[C]omments included in the Court's opinion — taken together
with the rather modest awards secured by the Steel Faction — hardly
add up to the more calamitous representations offered in the Steel
Faction's recent materials, particularly given the Drake Faction
purportedly offered to make the same curative disclosures prior to
the foregoing proceeding."
Conclusion
"Our confidence in [our] recommendation is also carved in relief
by the Steel Faction platform, the bulk of which suggests Mr.
Lichtenstein has a strong preference for personal and professional
affiliates, a disinterest in competing voices and a questionable
approach to accountability."
Ms. Drake and the other members of the Committee for Aerojet
Rocketdyne Shareholders and Value Maximization encourage all
investors to review and consider the recent presentation materials
posted on the Committee's website addressing many of Mr.
Lichtenstein's false statements and mischaracterizations available
here.
The Independent Slate Urges All Shareholders to Support its
Highly Qualified Nominees by Voting "FOR" on the WHITE Proxy Card
at the Upcoming Special Meeting on June
30.
Shareholders with questions can contact our solicitor: D.F.
King &
Co., (212) 269-5550 (collect) or via e-mail at AJRD@dfking.com.
Important Information
This communication is being made in the participants' individual
capacity, and not by or on behalf of the Company. No Company
resources were used in connection with these materials. We have
neither sought nor obtained consent from any third party to use any
statements or information indicated herein. On June 1, 2022, Eileen P.
Drake, General Kevin Chilton,
USAF (Ret.), General Lance Lord,
USAF (Ret.) and Thomas Corcoran (the
"Incumbent Directors") filed a definitive proxy statement with the
Securities and Exchange Commission in connection with the
solicitation of proxies for a special meeting of stockholders of
the Company to be held on June 30,
2022.
Contact:
D.F. King & Co., Inc.
Edward T. McCarthy / Tom Germinario
AJRD@dfking.com
Committee's Website:
https://maximizeajrdvalue.com
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content:https://www.prnewswire.com/news-releases/glass-lewis-recommends-aerojet-rocketdyne-shareholders-vote-for-the-entire-independent-slate-led-by-ceo-eileen-drake-301572869.html
SOURCE Committee for Aerojet Rocketdyne Shareholders and Value
Maximization