TPG-Axon, beneficial owner of seven percent of the outstanding shares of SandRidge Energy, Inc. (NYSE: SD) (the “Company”), today announced that Glass, Lewis & Co. (Glass Lewis), a leading independent proxy voting and corporate governance advisory firm, has recommended SandRidge stockholders vote the GREEN consent card in support of TPG-Axon’s proposals.
Specifically, Glass Lewis recommends SandRidge’s bylaws be amended to destagger the Board, that six incumbent directors be removed, including SandRidge Chief Executive Officer Tom Ward, and that independent director nominees Stephen C. Beasley, Edward W. Moneypenny, Dinakar Singh, Alan J. Weber, Dan A. Westbrook and Peter H. Rothschild be elected to the Board. Glass Lewis also recommends stockholders NOT VOTE the white consent card provided by SandRidge.
TPG-Axon recommends stockholders vote its full slate of independent directors including Mr. Beasley, Mr. Moneypenny, Mr. Singh, Mr. Weber, Mr. Westbrook, Mr. Rothschild and Fredric G. Reynolds. TPG-Axon requests that stockholders return their signed and dated GREEN consent cards promptly, to ensure that their consent cards are received by SandRidge prior to March 15, 2013, the deadline for submitting consents.
In its recommendation, Glass Lewis noted the following:
- “We agree with TPG-Axon that independent shareholders would strongly benefit from fresh, external perspectives and a substantial overhaul of board level oversight.”
- “…we find an equally dismal corporate governance landscape marred by regressive practices, poorly-implemented compensation policies and a general lack of substantive oversight.”
- “As a rule, we are reticent to recommend the removal of incumbent board members, or in favor of dissident nominees, unless one of the following two things has occurred: (i) there are serious problems at the company and the newly proposed nominees have a clear and realistic plan to solve these problems; or (ii) the current board has undertaken an action clearly contrary to the interests of shareholders (or failed to undertake an action clearly to the benefit of shareholders).”
- “We agree with the Dissident that there is sufficient cause to doubt the board's assessment of certain related party transactions, particularly those related to CEO Tom Ward…We believe it is entirely reasonable for independent shareholders to question how the continued involvement of a conflicted CEO could possibly benefit SandRidge over any term…”
- “Taken collectively, we find the foregoing issues strongly indicative of a board sorely unprepared to create or protect shareholder value, or, indeed, effectively oversee a CEO that has, by virtually any meaningful standard, steered SandRidge toward peer-worst performance since the Company's initial public offering. In lieu of offering owners any value-additive rebuttal to these concerns, it appears the board has opted to double down on its poor pattern of practice by adopting a shareholder rights plan and clumsily wielding the threat of violated debt covenants and potential executive severance payments as a cudgel to maintain the status quo.”
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