Urges Assertio Stockholders to Vote Against
All Directors at Upcoming Annual Meeting in Order to Either
Pressure Current Board to Accept New Stockholder-Recommended
Directors or Force Resignations of Significant Portion of Board
Pursuant to Bylaws
Board and Management Inappropriately Answered
or Refused to Answer Questions Over Very Material Matters
Believes Insiders May Have Not Personally
Purchased Shares in Over Three Years Due to Material Non-Public
Information
Last Remaining Investor-Minded Advocate on
Board Has Chosen to Step Down Over Inappropriate Boardroom
Activity, Leaving a Largely Out-of-Touch Board
Analysts Have Dropped Coverage of Assertio Due
to What Appears to be Lost Faith in Leadership's Due Diligence
Abilities, Reinforcing BHG's Concerns
Intends to Imminently Release Third-Party
Expert Opinions Concerning Assertio Board and Management's Apparent
Disclosure Failures and Deficiencies, for Further Delivery to
Regulators
Believes Board Should Promptly Explore
Strategic Alternatives, Including a Possible Sale, Given
Significant Opportunity to Achieve Post-Acquisition Operating
Profit Enhancement through Reduced SG&A Expenses
NEW
YORK, May 13, 2024 /PRNewswire/ -- The
Buxton Helmsley Group, Inc. (together with certain of its
affiliates, "BHG" or "we"), a New York
City-based investment fund manager that holds a significant
interest in the common stock shares of Assertio Holdings, Inc.
("Assertio" or the "Company") (NASDAQ: ASRT) urges Assertio
stockholders to vote "against" all of the Company's director
nominees at the Company's upcoming 2024 annual meeting of
stockholders on May 23, 2024 (the
"Annual Meeting"). BHG strongly believes that significant change to
the Assertio board of directors (the "Board") is necessary in order
to bring about new oversight and reinstate stockholder-like
judgment in the Boardroom. Any stockholders who have already cast
their ballots should immediately call their broker to change their
ballot to reflect a vote "against" all Assertio
directors.
In addition, Assertio stockholders are urged to communicate
their support of BHG's campaign and opposition to the present
Assertio Board via a news release or private letter to the Board.
Letters to the Board may be sent to investors@assertiotx.com,
with a copy to BHG at asrt@buxtonhelmsley.com.
Alexander Parker, Senior Managing
Director at BHG, explained the rationale for the campaign:
"Assertio is a valuable company that fulfills
very critical needs in the healthcare system. That said, after
alarming communications between us and Assertio's Board and
management, we have concluded that Assertio's Board requires change
to reinstate stockholder-like judgment in the Boardroom and restore
value for all stockholders. It is abundantly clear to us that
without meaningful change, stockholders likely face imminent
irreparable harm.
"We have made numerous attempts to avoid
aggressive public action, but it seems more and more clear to us
that this incumbent Board requires outside pressure to change. To
that end, we recently privately proposed that the Board appoint two
new directors, which the Company and Board appears to have
rejected. Such a rejection makes it very clear that this Board just
wants to retain control. It's no wonder they have driven out the
last apparent remaining director (James Tyree) who was able to
recognize the Board's inappropriate decision-making, who was
willing to put his foot down, and who now has resigned in
protest.1
"If the Board simply accepts our proposal to add
directors (who will serve without cash compensation), it can avoid
a costly proxy contest with BHG that would cost stockholders
hundreds of thousands of dollars, if not millions.
"Developments under the current regime are
disturbing. Under the leadership of Chairman Peter Staple, Assertio acquired Spectrum
Pharmaceuticals in Q3 2023, yet admitted—within a mere quarter's
time—to have overpaid by approximately 75%, or $150 million. This resulted in legacy Assertio
stockholder interests being diluted four times as much as necessary
(effectively handing a substantial portion of the legacy Assertio
business to Spectrum's pre-acquisition stockholders at no cost to
them).
"This Board has made clear it is both incapable
of sufficient oversight of management and that it does not hold
itself accountable for massive blunders like the Spectrum
acquisition. Nor does it seem to be incentivized to since
there's a tension created between pursuing a financial recovery
over misrepresentations in the Spectrum acquisition catastrophe and
what we can only imagine is the Board's desire to save face after
clearly failing to conduct adequate due diligence and forethought
leading up to the Spectrum acquisition. This Board has a clear
conflict of interest in that pursuing recovery for the Spectrum
blunder that occurred under its oversight, would likely be
perceived by most investors as failures of this Board to engage in
due diligence. The only directors who would not be exposed to that
conflict of interest would be new, shareholder-appointed directors,
and that is precisely what BHG is pursuing and has proposed."
"While the Board has just taken action by
ousting some of Assertio's top executives, not a single
non-executive director has held themselves accountable by tendering
a resignation. Even Mr. Staple—who has ultimate responsibility for
oversight of the Board as Chairman—continues to serve in his role.
Mr. Staple was due to resign this year after nearly two decades on
the Board and upon reaching Assertio's mandatory retirement
age, yet the Board outrageously granted him the preferential
treatment of a waiver to remain serving as a director. As a result
of this, James Tyree resigned in
protest and the Company announced he would not stand for
re-election at the Annual Meeting."2
"When BHG inquired about the due diligence
failures in the Spectrum acquisition, the Assertio Board and
management's responses were beyond alarming. The Company refused to
give a reliable written response over critical, material matters
that should have already been disclosed in SEC filings – in certain
cases also implicating that the response to the questions would
indeed be material. In a meeting with BHG on May 7, 2024, certain members of Assertio's Board
and management gave materially different responses than what they
put in writing before the meeting, when BHG had already forewarned
any material explanation needed to be in writing due to the
criticality of the matters and to ensure a genuine, reliable answer
was being given. The Board and management then resorted to
defending their existing public disclosures. We now see that
Assertio's Board and management are apparently fine with minimal,
inadequate disclosure, which represents a danger of imminent
irreparable harm to Assertio's public investors who rely on such
woefully deficient disclosures."
"It is not possible for investors to effectively
value Assertio securities without the information BHG has sought.
BHG believes this undisclosed information may be the reason behind
why none of Assertio's directors have purchased a single share of
stock with their own funds in the past three years. We also believe
the Company's stock would likely not be trading at such depressed
levels if the Board would disclose certain information implicated
to be materially positive. The Board and management
of Assertio outrageously questioned BHG why it was obligated
to disclose positive financial information that it is withholding,
effectively suppressing Assertio's stock price. That information,
if material as the Company implicated it to be, was already
required to be disclosed to public market participants pursuant to
Regulation S-X."
BHG, with a track record of relentless investor advocacy, has
demanded two seats on the Assertio Board to provide currently
lacking oversight in the areas of disclosure, due diligence,
capital allocation strategy, and otherwise.
BHG also believes that Assertio's Board should initiate a
modest, but material share repurchase program (to take some level
of action for defense against the Company's valuation, and to
capitalize on the Company's depressed stock price for the benefit
of long-term stockholders), and also wishes to restore
stockholder-like judgment in the boardroom in relation to expenses.
For instance, the Board has spent hundreds of thousands of dollars
on paid analyst coverage—which even this Board and management could
not justify as to how that creates long-term stockholder value—and,
though the Board could not justify the expense, they regarded this
corporate waste as being acceptable to continue because it is
"immaterial." BHG does not regard hundreds of thousands of dollars
as 'immaterial' at Assertio (especially, when Assertio's equity
market capitalization is approximately $94
million), and knows that investors would rather see these
funds allocated toward share repurchases. We believe the Board's
cluelessness regarding the effects of its decisions on investors is
likely due to its low ownership stake in Assertio.
Mr. Parker concluded, "This Board clearly spends 'other people's
money' – including in connection with acquisitions and unjustified
expenses – with no regard. Stockholders need to immediately correct
this problem by installing directors who will serve as fiduciaries
committed to conserving and maximizing value. The current Board is
failing miserably in this regard."
BHG intends to provide additional detail regarding these matters
in the time leading up to the Annual Meeting. Unless the Board
accepts BHG's proposal, BHG will likely initiate a solicitation as
a referendum on the Board. BHG's current proposal involves:
- The Addition of Two New Directors:
- Director #1: Alexander E.
Parker – Mr. Parker serves as Senior Managing
Director of Buxton Helmsley,
overseeing the firm's investor advocacy efforts. Through a number
of investor advocacy campaigns, he is known for utilizing his
straightforward business acumen, in combination with his extensive
knowledge of accounting and legal obligations at publicly traded
entities, to both maximize and protect the financial interests of
the investors whose interests he is entrusted to represent. Mr.
Parker's track record of above-average due diligence capability,
having uncovered even repeat accounting and
securities fraud schemes at public companies, has
led to his insight being requested as part of regulatory
investigations and his allegations being pursued via class-action
investor litigation.
Most recently, Mr. Parker secured independent board representation
at Fossil Group, Inc. after receiving answers to due diligence
questioning that presented an apparent risk to investors.
BHG's proposal involves Mr. Parker agreeing to accept all-equity
compensation, and to then share his expertise, extensive
experience, and track record of stockholder advocacy for the
benefit of all Assertio stockholders. BHG notes that no other
Assertio director has accepted such zero cash compensation. BHG
believes Mr. Parker's presence on the Board will both dissuade
further inappropriate Board conduct and also foster an environment
of directors not simply accepting inappropriate actions, such as
the inappropriate herd behavior that led to director James Tyree resigning in protest.
- Director #2 – BHG has delivered a list of six (6) highly
qualified candidates to serve as the second new director, leaving
the choice to the Board. These candidates have varying backgrounds
and experience, primarily relating to capital markets, capital
allocation strategy, regulatory compliance, and financial
reporting. Thus far, the Board has not advised BHG that it is
unable to find a suitable candidate on this list.
- One Director Stepping Down: One Assertio director must
step down, both to eliminate stale knowledge in the Boardroom and
to avoid an even-sized Board that could lead to gridlock. As it
stands, Assertio's current six-person, even-numbered Board
leaves dangerous room for gridlock in deciding critical matters and
is yet another example of poor corporate governance.
BHG urges Assertio stockholders to immediately
cast votes "against" all of Assertio director nominees at the
upcoming May 23, 2024 Annual Meeting.
If a stockholder has already cast their ballot, they should
immediately call their broker to change their ballot to reflect
a vote "against" all Assertio directors.
THE FOREGOING INFORMATION MAY ALSO BE DISSEMINATED TO
STOCKHOLDERS VIA TELEPHONE, AND EMAIL AND SHOULD NOT BE CONSTRUED
AS INVESTMENT ADVICE OR AS A SOLICITATION OF AUTHORITY TO VOTE YOUR
PROXY. THE COST OF DISSEMINATING THE FOREGOING INFORMATION TO
STOCKHOLDERS IS BEING BORNE ENTIRELY BY BHG. PROXY CARDS WILL NOT
BE ACCEPTED BY BHG. PLEASE DO NOT SEND YOUR PROXY TO BHG. TO
VOTE YOUR PROXY, PLEASE FOLLOW THE INSTRUCTIONS ON YOUR PROXY CARD
SENT TO YOU BY ASSERTIO.
About Buxton Helmsley
The Buxton Helmsley Group, Inc. is a New York City-based investment advisory firm
and fund manager, engaging both active and passive investment
strategies across a range of asset classes, with a general focus on
opportunities in North America and
Europe. The investment approach is
based on deep fundamental analysis and risk management, with a
focus on ensuring disclosure obligations are being upheld under
applicable accounting standards and securities laws.
Media Contact:
Public Relations and Corp. Comm.
Tel: +1 (212) 561 - 5540, Option 4
press@buxtonhelmsley.com
Cautionary Statement Regarding Forward-Looking
Statements
This press release does not constitute an offer to sell or
solicitation of an offer to buy any of the securities described
herein in any state to any person. The information herein contains
"forward-looking statements". Specific forward-looking statements
can be identified by the fact that they do not relate strictly to
historical or current facts and include, without limitation, words
such as "may," "will," "expects," "believes," "anticipates,"
"plans," "estimates," "projects," "potential," "targets,"
"forecasts," "seeks,""could," "should" or the negative of such
terms or other variations on such terms or comparable terminology.
Similarly,statements that describe our objectives, plans or goals
are forward-looking. Forward-looking statements are subject to
various risks and uncertainties and assumptions. There can be no
assurance that any idea or assumption herein is, or will be proven,
correct or that any of the objectives, plans or goals stated herein
will ultimately be undertaken or achieved. If one or more of such
risks or uncertainties materialize, or if BHG's underlying
assumptions prove to be incorrect, the actual results may vary
materially from outcomes indicated by these statements.
Accordingly, forward-looking statements should not be regarded as a
representation by BHG that the future plans, estimates or
expectations contemplated will ever be achieved.
1 See Form 8-K, filed by the Company on
April 2, 2024.
2 See Form 8-K, filed by the Company on
April 2, 2024.
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SOURCE Buxton Helmsley Group, Inc.