HOUSTON, May 28, 2013 /PRNewswire/ -- Crest Financial
Limited, the largest of the independent minority stockholders of
Clearwire Corporation (NASDAQ: CLWR), today urged Clearwire's "true
minority stockholders" to oppose Sprint's new offer and to take the
steps necessary to preserve their rights.
In a letter to stockholders, David K.
Schumacher, Crest's General Counsel, said Crest refers to
"true minority stockholders" because "Clearwire has stacked the
deck in favor of Sprint by including as "minority" stockholders a
group holding 13% of the outstanding shares that irrevocably
obligated themselves to support Sprint even at the $2.97 per share price. These shares
are pledged to support Sprint regardless of the alternatives
available and regardless of whether Clearwire's Board recommends
supporting Sprint's offer. And Sprint is obligated to
purchase these shares for the merger consideration—after they have
been counted as the "minority"—if the vote fails and the
Sprint-SoftBank merger or an alternative transaction is
consummated. That means only one thing: for all intents
and purposes these are Sprint shares and their votes should not be
counted as minority approval. We have filed suit to challenge
Sprint's naked interference with stockholder democracy. The
presiding judge has indicated that, in the Court's eventual review
of the transaction's fairness, the inclusion of these shares in the
minority vote count may compromise any benefit Clearwire and Sprint
would assert from the vote. We are evaluating all options to
provide you with better clarity about who is truly eligible to be
counted as non-Sprint stockholders. Sprint must not be
allowed to have its cake and eat it too."
Schumacher said: "Of course there is a way forward: We
true minority stockholders can reject the current Sprint offer, and
the Clearwire Board can allow competitive bidding for Clearwire to
begin. SoftBank's CEO Masayoshi
Son has suggested publicly that even if we prevail, SoftBank
will be 'happy' because Sprint would own 65 percent of
Clearwire. According to Son, that will be 'good enough' for
him because 'Clearwire would be prohibited to have any sales of
frequency to outsiders and so on.' But Masayoshi Son is
wrong. Sprint will grab the additional 13% of shares from
Intel, Comcast, and Bright House Networks ('BHN') only if Sprint
actually consummates the Sprint-SoftBank merger or alternative
transaction. And we believe that if Sprint's bid for
Clearwire is rejected, neither a Sprint-SoftBank nor Sprint-DISH
transaction will ever actually materialize. In that event,
Intel, Comcast, and BHN would be free to maintain their collective
13% of the minority shares in an independent Clearwire. These
13% stockholders, after all, are the same stockholders who made
significant investments in Clearwire as parties to the
Equityholders' Agreement even before the Company's value became
clear. Now that the Company's value is clear, it stands to
reason that they would support pursuing value through an
independent Clearwire once Sprint's gambit to divert Clearwire's
value to itself is up. In the end, once the battle for
control of Sprint is resolved, Sprint could end up exactly where it
is today—with at most 50.2% ownership of Clearwire—and Intel,
Comcast, and BHN could retain their rights under the Equityholders'
Agreement and an independent Clearwire could pursue value for all
stockholders, not just Sprint."
Schumacher also said any vote in favor of the merger agreement
would limit minority stockholders' range of options to recover the
fair value of shares if Sprint succeeds in its unfair bid for
Clearwire. According to Schumacher, "Any vote in favor of the
merger agreement would limit your range of options to recover the
fair value of your shares if Sprint succeeds in its unfair bid for
Clearwire. Delaware law
states that only Clearwire stockholders who vote AGAINST the
Sprint-Clearwire merger or ABSTAIN can elect to exercise their
appraisal rights. Crest has already taken all necessary steps
to perfect its appraisal rights under Delaware law. This means that, instead
of pursuing damages for breaches of fiduciary duty by Sprint and
the Clearwire Board through a class action or individual action,
Crest can ask the Delaware Court
of Chancery to determine the fair value of its Clearwire common
stock if the Sprint-Clearwire merger is consummated and certain
other conditions are satisfied. But appraisal rights are by
definition individual rights. You must perfect your own
appraisal rights and cannot vote in favor of the merger if you are
to carry on the fight for fair value in an appraisal
proceeding."
Schumacher added: "Crest and other stockholders who believe that
the merger consideration is inadequate have options for judicial
relief, including: (a) appraisal, which is an individual
action seeking a fair value determination for only the complaining
stockholder (i.e., any relief would not be available to a
class of stockholders); (b) individual lawsuits seeking
damages and other relief for breaches of fiduciary duty by Sprint
and the Clearwire Board for only the complaining stockholder (as
Aurelius Capital Management LP has filed); and (c) a class
action lawsuit seeking damages and other relief for breaches of
fiduciary duty by Sprint and the Clearwire Board (as several
stockholders, including Crest, have filed). As the ongoing
battle for Clearwire's future proceeds, Crest continues to weigh
all litigation options, including an appraisal proceeding or an
individual action."
Schumacher concluded: "Crest encourages Clearwire's other true
minority stockholders to oppose the merger and to act now to
perfect their rights to pursue fair treatment through all available
avenues, including an appraisal proceeding."
D.F. King & Co, Inc. has been
retained by Crest to assist it in the solicitation of proxies in
opposition to the merger. If stockholder have any questions or need
assistance in voting the GOLD proxy card, please call D.F. King & Co. at (800) 949-2583. The full
letters to the Clearwire Board and the letter to the Clearwire
stockholders can be found at http://www.dfking.com/clwr or
http://www.bancroftpllc.com/crest.
About Crest Financial Limited
Crest Financial Limited
("Crest") is a limited partnership under the laws of the
State of Texas. Its principal
business is investing in securities.
Important Legal Information
In connection with the
proposed merger of Clearwire Corporation ("Clearwire") with Sprint
Nextel Corporation (the "Proposed Sprint Merger"), Crest and other
persons (the "Participants") have filed a supplement to its
definitive proxy statement with the U.S. Securities and Exchange
Commission ("SEC"). The supplement was mailed to the stockholders
of Clearwire on or around May 24,
2013. SECURITYHOLDERS OF CLEARWIRE ARE URGED TO READ THE
DEFINITIVE PROXY STATEMENT AND THE SUPPLEMENT, WHICH IS AVAILABLE
NOW, AND THE PARTICIPANTS' OTHER PROXY MATERIALS FILED WITH THE SEC
WHEN THEY BECOME AVAILABLE, BECAUSE THEY CONTAIN IMPORTANT
INFORMATION, INCLUDING ADDITIONAL INFORMATION RELATED TO THE
PARTICIPANTS, CLEARWIRE AND THE PROPOSED SPRINT MERGER. The
definitive proxy statement, the supplement and all other proxy
materials filed with the SEC are available at no charge on the
SEC's website at http://www.sec.gov. In addition, the
definitive proxy statement and the supplement are also available at
no charge on the website of the Participants' proxy solicitor at
http://www.dfking.com/clwr.
Forward-looking Statements
Certain statements
contained herein are forward-looking statements including, but not
limited to, statements that are predications of or indicate future
events, trends, plans or objectives. Undue reliance should not
be placed on such statements because, by their nature, they are
subject to known and unknown risks and
uncertainties. Forward-looking statements are not guarantees
of future activities and are subject to many risks and
uncertainties. Due to such risks and uncertainties, actual
events may differ materially from those reflected or contemplated
in such forward-looking statements. Forward-looking statements
can be identified by the use of the future tense or other
forward-looking words such as "believe," "expect," "anticipate,"
"intend," "plan," "should," "may," "will," believes," "continue,"
"strategy," "position" or the negative of those terms or other
variations of them or by comparable terminology.
SOURCE Crest Financial Limited