StoneMor Inc. Announces Withdrawal of Axar Proposal, Proposed Amendments to Charter to Be Considered by Its Stockholders and ...
September 08 2020 - 8:55AM
StoneMor Inc. (NYSE: STON) (“StoneMor” or the
“Company”), a leading owner and operator of
cemeteries and funeral homes, announced today that Axar Capital
Management, LP (“
Axar”), after determining that it
will not be able to reach an agreement with the Special Committee
on terms that would be satisfactory to Axar, has withdrawn its
proposal to acquire all of the outstanding shares of common stock
of the Company not owned by Axar or its affiliates. A copy of the
letter from Axar withdrawing its proposal is attached hereto as
Annex A.
Stephen J. Negrotti, Chairman of the Special
Committee of the Board of Directors said, “We have worked closely
with Axar over the last six weeks to evaluate its most recent
proposal. We have consulted with our financial and legal advisors
throughout the process. Despite these efforts, there remained a
substantial difference regarding the valuation of the Company.”
Proposed Amendments to Certificate of
Incorporation
In an unrelated announcement, the Company also
disclosed that its Board has voted unanimously to submit two
proposals to the Company’s stockholders at its 2020 Annual Meeting
of Stockholders to amend its certificate of incorporation. The
first proposal would effect a reverse split of the Company’s common
stock at a ratio of 1-for-10 in the event that the Board deems such
action to be advisable to avoid delisting on the New York Stock
Exchange (the “NYSE”), or otherwise in the best interests of the
Company and its stockholders at the time.
As previously reported, the Company received a
notice from the New York Stock Exchange (the “NYSE”) in April 2020
stating that it was not in compliance with the NYSE’s minimum price
continued listing requirements. In order to regain compliance, the
closing price of the Company’s common stock on December 24, 2020
and the average closing price for the 30 trading days ending on
that date must be at least $1.00. The Company also would regain
compliance if the closing price of the common stock on the last
trading day of any month and the average closing price for the 30
trading days ending on that date is at least $1.00.
The second proposal would declassify the Board
and provide for annual elections for all directors. Currently, the
Company’s Board is divided into three classes, with the members of
each class serving staggered three-year terms. If the stockholders
approve the proposal, each director will resign upon the
effectiveness of the amendment and immediately be reappointed to
the Board to serve until the Company’s 2021 annual meeting.
Beginning at that meeting, all directors will stand for election
annually.
The proposals to amend the Company’s certificate
of incorporation will be detailed in the Company’s proxy statement,
which will be filed and disseminated to the stockholders in advance
of the annual meeting, which will be held on November 5, 2020. This
press release is being provided for informational purposes only and
does not constitute the solicitation of any vote for approval of
any transaction or proposal.
Election of Kevin D. Patrick to
Board
Lastly, StoneMor also announced that on
September 4, 2020, the Board increased the size of the Board to
eight directors and elected Kevin D. Patrick to fill the new
position. Mr. Patrick has been Senior Vice President, Chief
Financial Officer and Treasurer of Colonial Williamsburg Foundation
since August 2017. In this capacity, he is responsible for all
financial aspects of the operation of the Foundation, which has
assets of approximately $1.0 billion, including an endowment of
approximately $700.0 million, annual revenues in excess of $200.0
million and approximately $337.0 million in outstanding debt. Mr.
Patrick holds an MBA from the University of Connecticut and a BBA
in Finance from Connecticut State University’s Ancell School of
Business.
Andrew Axelrod, StoneMor’s Chairman of the
Board, said, “We are excited to welcome Kevin to the Company’s
Board of Directors. His experience as a Chief Financial Officer,
particularly in regards to corporate development, business
turnarounds and financing strategies, is a perfect match as
StoneMor looks to the future.”
“As I researched and met with the team at
StoneMor, I have been very impressed with the turnaround strategy
and the progress achieved by Joe Redling and the management team,”
said Kevin D. Patrick. “I am looking forward to bringing new
perspectives and experiences to the Company as a board member and
am ready to support the continued turnaround efforts.”
About StoneMor Inc.
StoneMor Inc., headquartered in Trevose,
Pennsylvania, is an owner and operator of cemeteries and funeral
homes in the United States, with 319 cemeteries and 88 funeral
homes in 27 states and Puerto Rico.
StoneMor’s cemetery products and services, which
are sold on both a pre-need (before death) and at-need (at death)
basis, include: burial lots, lawn and mausoleum crypts, burial
vaults, caskets, memorials, and all services which provide for the
installation of this merchandise. For additional information about
StoneMor Inc. please visit StoneMor’s website, and the investors
section, at http://www.stonemor.com.
CONTACT: |
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Investor Relations |
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StoneMor Inc. |
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(215) 826-4438 |
A PDF listed as ANNEX A is available
at: http://ml.globenewswire.com/Resource/Download/6c10c3a2-4e6c-4415-8eab-950b0e3afcf6
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