Nov. 2, 2010
/PRNewswire/ -- Golconda Capital Management, LLC today announced the nomination of director candidates to the American Pacific Corporation (Nasdaq: APFC) Board of Directors. In addition, Golconda has called on the Company's board of directors to make several corporate governance changes.
, the Managing Member of Golconda, issued the following statement:
"We believe the Golconda nominees offer American Pacific a depth and breadth of knowledge and experience that will be of great value to its stockholders as the Company works to return to profitability and to provide a fair return on invested capital. We are concerned that the incumbent Board of Directors and management has not demonstrated an appropriate sense of urgency in reducing expenses – both SG&A and production costs. The cost to stockholders of this lack of urgency has been compounded by the Company's poor corporate governance practices."
In addition to the nomination of director candidates, Golconda has also advocated for various stockholder-friendly corporate governance changes. In correspondence to the Chairman of American Pacific dated
September 10, 2010
, Golconda urged the Company's board to make the following corporate governance changes as soon as administratively possible:
- Change vote requirement to elect directors from 80% to a plurality vote standard for contested elections and a majority vote standard for uncontested elections;
- Eliminate the poison pill and adopt a policy to require stockholder approval for future poison pills;
- Declassify the Board of Directors so that the entire board stands for election each year, and
- Change the advance notice requirements so that director nominations and stockholder proposals can be made closer to the annual meeting date.
"In our opinion, the Company's response to our recommendations has been inadequate. The advance notice requirements were eased by only 30 days, no policy has been established to subject poison pills to a stockholder vote and the Board has not been declassified. In particular we note that in response to our stockholder advocacy efforts, the Board has agreed to recommend that stockholders change the 80% vote requirement to a majority requirement. However, this vote will not be held until the 2011 annual meeting of stockholders and will not be effective until the 2012 annual meeting. In our view, there is no reason to delay the vote on this important corporate governance change. The Company can call a special meeting of stockholders at any time prior to the annual meeting to put this issue to a vote by the stockholders," said Mr. Summitt.