NEW YORK, April 10, 2018 /PRNewswire/ -- Sidus
Investment Management, LLC and BLR Partners LP (together, "Sidus,"
"we" or "us"), collectively one of the largest stockholders of
Acacia Research Corporation ("Acacia" or the "Company") (NASDAQ:
ACTG), with aggregate ownership of approximately 4.2% of the
Company's outstanding shares, today issued a letter to the
Company's Board of Directors (the "Board"). In the letter, Sidus
explained its belief that the incumbent Board members must be held
accountable for the significant value destruction at Acacia and
called for the pattern of entrenchment to stop. The full text of
the letter follows:
April 10, 2018
Dear Acacia Board Members:
We view with increasing concern the Board's unilateral and
immediate appointments of Joe Davis
and Paul Falzone last week, neither
of whom has previously served as a director of a public company.
Taken together with the two other previously appointed and never
elected directors, 50% of the Board has been hand-picked by
incumbent directors and never elected by the Company's
stockholders. We believe this is entirely unacceptable, especially
considering the abysmal returns that stockholders have experienced
under this Board over nearly every relevant measurable period.
As a reminder, total shareholder returns have been disturbingly
negative over the past one (-34.4%), three (-65.0%), five
(-86.6%) and ten-year (-32.4%) periods.1 How can the
Company's stockholders have confidence in the directors hand-picked
by this Board to reverse this trend of losses? Further, we believe
that the Board has hired five separate advisory firms in an
apparent attempt to maintain the status quo and discredit our
demands for accountability and good governance. In our view,
stockholders would be better served if Acacia's corporate resources
were devoted to actions that will enhance stockholder value, not
entrench the incumbents.
Compounding these extremely problematic governance developments,
we were informed yesterday that Acacia notified Broadridge
Financial Systems that it was cancelling the previously noticed
April 9th record date and
June 7th meeting date and
setting a new record date of May
10th, but no meeting date has been set at
all. No information has been provided to stockholders as to why
these previously established dates were cancelled. As such, it
appears to us that the Board may be planning to take actions that
may not be in the best interests of the Company or its
stockholders, including delaying the 2018 annual meeting of
stockholders (the "Annual Meeting"). We nominated Clifford Press and Alfred V. Tobia Jr. for election to the Board of
Acacia at the Annual Meeting in order to give stockholders an
opportunity to elect representatives of their choosing. We believe
that incumbent directors who have overseen such significant value
destruction at Acacia must be held accountable – not allowed to
unilaterally appoint new Board members without stockholder
consent.
We warn the Board to refrain from taking any action that may
harm stockholders, including by further entrenching the incumbents.
Specifically, the Board and management must not take any action to
use corporate resources or engage in any material transaction
without stockholder approval or prior to stockholders having the
opportunity to vote on the composition of the Board. If necessary,
on behalf of our fellow stockholders, we will pursue every
available legal remedy to invalidate any such transaction that we
do not believe is in the best interests of the Company or its
stockholders, or is otherwise, in our view, tainted by
self-interest or an intent to entrench.
We believe that stockholders deserve better than, in our view,
failed performance from an entrenched Board. Accordingly, we demand
that the Board hold the Annual Meeting without delay in order to
allow stockholders to elect representatives of their choice. The
judgment of stockholders is inevitable – experience has shown us
that further attempts by the incumbents to manipulate the Company's
corporate machinery at the expense of the Company's stockholders
will only strengthen stockholders' resolve to effect meaningful
change at the Company. We look forward to presenting our highly
qualified candidates to stockholders for their consideration at the
Annual Meeting.
Sincerely,
Sidus Investment Management, LLC and BLR Partners LP
Contacts:
Clifford Press
(212) 277-5635
Alfred V. Tobia Jr.
(212) 751-6644
John Ferguson
Saratoga Proxy Consulting LLC
(212) 257-1311
CERTAIN INFORMATION CONCERNING THE
PARTICIPANTS
Sidus Investment Management, LLC, together with the other
participants named herein (collectively, "Sidus"), has filed a
preliminary proxy statement and accompanying BLUE proxy card with
the Securities and Exchange Commission ("SEC") to be used to
solicit votes for the election of its slate of director nominees at
the 2018 annual meeting of stockholders of Acacia Research
Corporation, a Delaware
corporation (the "Company").
SIDUS STRONGLY ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ
THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH
PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S WEB
SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS
PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT
WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES
SHOULD BE DIRECTED TO SARATOGA
PROXY CONSULTING LLC.
The participants in the proxy solicitation are anticipated to be
Sidus Investment Partners, L.P. ("Sidus Partners"), Sidus Double
Alpha Fund, L.P. ("Sidus Double Alpha"), Sidus Double Alpha, Ltd.
("Sidus Double Alpha Offshore"), Sidus Advisors, LLC ("Sidus
Advisors"), Sidus Investment Management, LLC ("Sidus Management"),
Michael J. Barone, Alfred V. Tobia Jr., BLR Partners LP ("BLR
Partners"), BLRPart, LP ("BLRPart GP"), BLRGP Inc. ("BLRGP"),
Fondren Management, LP ("Fondren Management"), FMLP Inc. ("FMLP"),
Bradley L. Radoff and Clifford Press.
As of the date hereof, Sidus Partners directly beneficially owns
167,448 shares of common stock, par value $0.001 per share (the "Common Stock"), of the
Company. As of the date hereof, Sidus Double Alpha directly
beneficially owns 458,461 shares of Common Stock. As of the
date hereof, Sidus Double Alpha Offshore directly beneficially owns
209,967 shares of Common Stock. As of the date hereof,
194,124 shares of Common Stock were held in an account to which
Sidus Management serves as the sub-advisor (the "Managed Account").
Sidus Advisors, as the general partner of each of Sidus Partners
and Sidus Double Alpha, may be deemed to beneficially own the (i)
167,448 shares of Common Stock owned directly by Sidus Partners and
(ii) 458,461 shares of Common Stock owned directly by Sidus Double
Alpha. Sidus Management, as the investment manager of each of
Sidus Partners, Sidus Double Alpha and Sidus Double Alpha Offshore,
and as the sub-advisor of the Managed Account, may be deemed to
beneficially own the (i) 167,448 shares of Common Stock owned
directly by Sidus Partners, (ii) 458,461 shares of Common Stock
owned directly by Sidus Double Alpha, (iii) 209,967 shares of
Common Stock owned directly by Sidus Double Alpha Offshore and (iv)
194,124 shares of Common Stock held in the Managed Account. Each of
Messrs. Barone and Tobia, as a Managing Member of Sidus Management,
may be deemed to beneficially own the (i) 167,448 shares of Common
Stock owned directly by Sidus Partners, (ii) 458,461 shares of
Common Stock owned directly by Sidus Double Alpha, (iii) 209,967
shares of Common Stock owned directly by Sidus Double Alpha
Offshore and (iv) 194,124 shares of Common Stock held in the
Managed Account. As of the date hereof, BLR Partners directly
beneficially owns 1,090,000 shares of Common Stock. BLRPart GP, as
the general partner of BLR Partners, may be deemed to beneficially
own the 1,090,000 shares of Common Stock owned directly by BLR
Partners. BLRGP, as the general partner of BLRPart GP, may be
deemed to beneficially own the 1,090,000 shares of Common Stock
owned directly by BLR Partners. Fondren Management, as the
investment manager of BLR Partners, may be deemed to beneficially
own the 1,090,000 shares of Common Stock owned directly by BLR
Partners. FMLP, as the general partner of Fondren Management, may
be deemed to beneficially own the 1,090,000 shares of Common Stock
owned directly by BLR Partners. Mr. Radoff, as the sole shareholder
and sole director of each of BLRGP and FMLP, may be deemed to
beneficially own the 1,090,000 shares of Common Stock owned
directly by BLR Partners. As of the date hereof, Mr. Press does not
beneficially own any shares of Common Stock.
1 Source: Bloomberg, calculated as of April 4, 2018.
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SOURCE Sidus Investment Management, LLC