WaterMill Asset Management Releases Presentation Detailing the Case for Urgent Change Atop Ziopharm Oncology
November 19 2020 - 9:30AM
Business Wire
Highlights the Incumbent Board’s
Anti-Shareholder Practices, Concerning Interconnectivity, and
Record of Presiding Over Negative Returns Across Every Relevant
Time Horizon
Makes Clear That Ziopharm is on a Path to
Financial Ruin as its Capital Position Shrinks, G&A and R&D
Costs Rise, and Value-Generating Pipeline Progress Remains
Evasive
Reminds Shareholders That the WaterMill
Slate has the Business Acumen, Financial Expertise and
Relationships, and Commercial Intensity Required to Help Engineer a
Turnaround
Urges Shareholders to Vote on the
WHITE Consent Card to Reconstitute the
Board with WaterMill’s Three Aligned, Independent and Qualified
Director Candidates
WaterMill Asset Management Corp. (together with its affiliates,
“WaterMill” or “we”), which collectively with the other
participants in its consent solicitation beneficially owns
approximately 3.3% of the outstanding shares of Ziopharm Oncology,
Inc. (NASDAQ: ZIOP) (“Ziopharm” or the “Company”), today released a
55-page presentation that details the case for urgent change in the
boardroom and summarizes its director candidates’ value-enhancing
vision. As a reminder, WaterMill is seeking to reconstitute
Ziopharm’s eight-member Board of Directors (the “Board”) by
removing four incumbent directors and electing three
highly-qualified and independent individuals: Robert Postma, Jaime
Vieser and Holger Weis.
WaterMill encourages shareholders to consent to all of its
proposals on the WHITE consent
card. We urge shareholders to sign, date, and return each
WHITE consent card they
receive. Please visit www.FixZiopharm.com to download the slate’s
presentation and learn how to consent.
Robert Postma, Principal and Founder of WaterMill,
commented:
“As we continue to pursue meaningful change atop Ziopharm, we
want shareholders to have a candid and comprehensive evaluation of
the Company’s corporate governance, capital allocation decisions,
financial positioning, and pipeline progress. Our 55-page
presentation includes an array of irrefutable data points and facts
pertaining to the incumbent Board’s anti-shareholder attitude,
highly-concerning interconnectivity, and record of presiding over
hundreds of millions of dollars in value destruction. Our
presentation also underscores a sobering reality: Ziopharm’s
diminishing cash position and rising burn rate appears to have put
the Company on a path to financial ruin. Fortunately, we believe
our three-member slate has the business acumen, capital allocation
expertise, financing relationships, and commercial creativity
required to stave off disaster and spark an enduring turnaround. We
are prepared to act with urgency to help ensure Ziopharm has the
right financing options, the right capital allocation framework,
and the right commercialization opportunities to advance its
science and finally deliver value for its shareholders.”
The presentation prepared by the WaterMill slate includes
specific detail pertaining to the case for change at Ziopharm. In
our view, our slate shows how the incumbent Board:
- Allows and embraces interlocking director connections,
including by just this week appointing a new director (Mary
Thistle) with ties to one existing director (Elan Z. Ezickson) and
one recently-departed director (Douglas Pagán).
- Disregards sound corporate governance practices, including by
not having a majority voting standard in uncontested
elections.
- Facilitates opaque capital raises that blindside and dilute
sizable long-term shareholders – oftentimes in contradiction of
Company statements suggesting that cash on hand is sufficient.
- Ignores the need for a disciplined capital allocation
framework, as evidenced by the Company’s skyrocketing research and
development costs and rising general and administrative expense
figures.
- Maintains a misaligned executive compensation structure that
has enabled c-level leaders to obtain significant incentive pay
despite staggering value destruction.
- Maintains excessive and off-market director compensation for a
small, struggling biotechnology entity.
- Permits internal financial control issues to linger for an
entire year without explaining the material weakness to
shareholders.
- Presides over negative returns over one-year, three-year, and
five-year horizons without taking effective steps to reverse value
destruction.
- Supports Scott Tarriff, who we believe is a highly-questionable
Chairman with a record of concerning lawsuits and poor corporate
performance.
- Shuns shareholders’ desire for more transparency pertaining to
possible business deals, potential partnerships, and trials.
Our slate’s presentation also outlines a strategic vision for
helping turn around Ziopharm. If elected to the Board, our director
candidates plan to suggest that a Special Committee be formed to
conduct a strategic review of the business. The ideal components of
this review would include (but are not limited to):
- Working with credible, third-party experts to value each of the
Company’s assets.
- Evaluating how much capital it may require for each specific
asset to reach an inflection/monetization point.
- Assessing the current methodology for allocating capital to
each clinical and pre-clinical initiative.
- Examining the current pipeline and progress for partnerships
and business development deals.
- Exploring the universe of new strategic and financial partners
for the Company based on new Board members’ extensive
relationships.
- Identifying the ideal source or sources of go-forward capital
to fund the reconstituted Board’s priority initiatives.
- Reviewing all personnel, ranging from the c-level leaders to
line employees, to identify talent needs and spot potential
redundancies.
- Benchmarking director and executive compensation relative to
peers and similarly-situated public companies.
- Conducting a credible shareholder perception study to inform an
improved, more transparent investor relations program.
- Assessing the quickest path to addressing internal financial
control issues and amending anti-shareholder governance
provisions.
***
We urge Ziopharm shareholders to consent to
all five proposals on the WHITE consent card today by signing,
dating and returning it in the postage-paid envelope provided.
Please vote each and every WHITE
consent card you receive since you may own multiple accounts. If
you have already voted a Green revocation card from Ziopharm, a
later-dated vote on the WHITE consent
card will revoke that vote.
December 11, 2020 is our goal for the
submission of written consents. Effectively,
this means that you have until December 11, 2020 to consent to the
proposals.
You may only consent by voting the
WHITE consent card. Please throw away
all Green revocation cards you receive.
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version on businesswire.com: https://www.businesswire.com/news/home/20201119005834/en/
For Investors: Saratoga Proxy Consulting LLC John
Ferguson / Joe Mills, 212-257-1311 jferguson@saratogaproxy.com /
jmills@saratogaproxy.com
For Media: Profile Greg Marose / Charlotte Kiaie,
347-343-2999 gmarose@profileadvisors.com /
ckiaie@profileadvisors.com
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