Follows Spate of Materially Misguided, Crude,
and Defamatory Statements Recently Made by LLAP’s Chairman &
CEO Marc Bell
Conflicting Statements in Wall Street Journal,
SEC Filings, TechCrunch, and Employee Communications Highlight
Serious Lack of Controls at Company and Board’s Inability to
Provide Management Oversight
Believes Urgent Board and Management Changes
are Required to Remediate Self-Inflicted Harm, Drive Share Price
Appreciation, Minimize Operational Risk, Optimize Long-Term
Stockholder Value and Restore Market Credibility
Notes Terran’s Board Continues to Ignore
Numerous Meeting Requests
Urges Board to Form New Committee of
Independent and Disinterested Directors That Do Not Report to Marc
Bell to Oversee Strategic Review and Meet With Concerned Investor
Group
A group of concerned investors (the “Concerned Investor Group”)
in Terran Orbital Corp. (NYSE: LLAP) (“Terran” or the “Company”)
comprised of Sophis Investments LLC, Roark’s Drift LLC, and Tyvak
Nano-Satellite Systems’ Co-Founders, Jordi Puig-Suari, Roland
Coelho and Austin Williams, today issued a statement reiterating
its call for Terran’s Board of Directors (the “Board”) to
immediately separate the roles of Chairman and Chief Executive
Officer following Marc Bell’s recent spate of materially misguided,
crude, and defamatory statements, as well as a series of highly
conflicting articles and statements, resulting in LLAP’s stock
price losing nearly 30% of its value in one day.1 The Concerned
Investor Group, together with certain affiliates, beneficially owns
16,581,465 shares of common stock of the Company, representing
approximately 8.4% of the shares outstanding.
“As aligned long-term stockholders, experienced Aerospace &
Defense investors, and former Company executives, we care deeply
about Terran and its long-term prospects and wish to protect and
maximize the material value we believe is embedded within Terran.
However, the events over the past 24 hours have made it abundantly
clear to us that Marc Bell is not fit to be CEO of Terran.
“Over the past 24 hours, The Wall Street Journal published an
article that Terran was exploring a sale of the Company, according
to unnamed sources, which was seemingly confirmed by the Company in
a filing with the Securities and Exchange Commission later that
morning2 and in a series of Mr. Bell’s tweets. Later that day, in
an all-employee meeting, Mr. Bell stated, as reported by
TechCrunch, that the Company was indeed not for sale. When the
market closed on December 11th, Terran’s stock price had lost
nearly 30% of its value from the day before.3
“Making matters worse, Mr. Bell has boasted about suing a
dissenting shareholder, threatened to file additional lawsuits, and
referred to members of the Concerned Investor Group as “idiots”
according to an article published by TechCrunch,4 and used crude
language and lamenting Terran’s languishing stock price in his
recent Twitter posts.
“Accordingly, we reiterate our call for Terran’s Board to
immediately separate the role of CEO and Chairman and install a new
CEO with demonstrable industry experience and a track record of
outperformance, who can turn around the operational, cultural, and
capital allocation issues plaguing the Company. We believe that a
new CEO, namely our identified CEO candidate--who, for the
avoidance of doubt is not a former employee of the Company—will
help Terran to attract the needed capital on favorable terms,
minimizing future dilution to stockholders and providing
prospective customers and employees with the confidence to conduct
business with the Company going forward. In addition, we believe,
if installed, our CEO candidate would attract and retain additional
world class talent. Mr. Bell has also stated publicly that
Jefferies is ‘exploring all possibilities,’ though this cannot be
true without engaging with our CEO candidate and the Concerned
Investor Group.
The TechCrunch article also states that “Bell told staff that if
the board (which he chairs) decided on a take-private deal, Bell
and a business partner would buy the company themselves.” We
believe this presents a major conflict of interest. The
Concerned Investor Group further believes that any strategic review
should be evaluated solely by a newly formed committee of
disinterested and independent directors that do not report to Mr.
Bell. The Concerned Investor Group further reiterates that, as
previously stated on multiple occasions, any strategic review
should only be undertaken after the Company has been stabilized and
leadership is reconstituted, or else it risks a tarnished process
and suboptimal outcome for shareholders.
Given the Concerned Investor Group’s strong belief that the
current Board lacks the ability to provide proper oversight of
management and the letter Mr. Bell sent to all employees on
December 11th is material to all stockholders, an excerpt therefrom
as published by TechCrunch, has been reproduced here:
“As for shareholder criticism the whole thing
is a joke,” [Bell] says in the email. “Forget that the board and
management has over 30 million shares (they have 16 million) but we
have polled investors casually and over 100 million shares say they
approve of the direction we are taking and fully support us. We
also have 100% support of the board. The company recently sued one
of the Sophis idiots and we will be suing them all in due course.
They will eventually go away.”
Links to TechCrunch’s recent coverage of this situation can be
found here:
https://techcrunch.com/2023/12/11/terran-orbital-ceo-tells-staff-it-is-not-looking-for-a-buyer/
https://techcrunch.com/2023/11/27/terran-orbital-sues-former-cto-who-joined-call-for-leadership-shake-up/
For additional information, please visit: www.llapvalue.com.
Olshan Frome Wolosky LLP is serving as legal counsel to the
Concerned Investor Group.
About the Concerned Investor Group
The Concerned Investor Group is comprised of Sophis Investments
LLC, Roark’s Drift LLC, and Tyvak Nano-Satellite Systems’
Co-Founders, Jordi Puig-Suari, Roland Coelho and Austin Williams
and certain affiliates thereof. Sophis Investments LLC is a
supportive, long-term investor and seeks to establish constructive
dialogues with issuers as appropriate. The Concerned Investor
Group, together with affiliates, beneficially owns 16,581,465
shares of common stock of the Company, representing approximately
8.4% of the shares outstanding.
_______________________________
1 Bloomberg 2
https://www.sec.gov/ix?doc=/Archives/edgar/data/1835512/000095017023069209/llap-20231206.htm
3 Bloomberg 4
https://techcrunch.com/2023/12/11/terran-orbital-ceo-tells-staff-it-is-not-looking-for-a-buyer/
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231212116457/en/
For Media Nathaniel Garnick Gasthalter & Co. (212)
257-4170 LLAPvalue@gasthalter.com
For Investors Tassos Recachinas Sophis Investments LLC
(212) 572-6360 contact@LLAPvalue.com
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