CHICAGO, Dec. 22, 2021 /PRNewswire/ -- Gabi
Gliksberg, a long time stockholder of Texas Pacific Land
Corporation and, before the conversion, Texas Pacific Land Trust,
through ATG Capital Management, LLC, has issued an open letter to
Texas Pacific's Board of Directors in response to the Board's
criticism of Proposal #7 to de-stagger the Board and his lawsuit
for inspection of Company records.
The letters reads as follows:
Dear Members of the Board,
As a longstanding stockholder of
Texas Pacific Land Corporation (NYSE: TPL) ("TPL" or the
"Company"), I write to you today to address the concerns and
respond to the arguments you have raised in your December 20 letter to the Company's
stockholders.
First, I disagree with the
Board's reasoning in urging stockholders to vote against my
Proposal #7 to declassify the Board. You defend the current
classified Board structure as providing stability and continuity of
individual knowledge. Yet, you ignore the issues of Board
responsiveness and accountability to the corporation's owners,
values that are extremely important to myself and other
stockholders. The Company exists to benefit its owners, not
the Board. And it should be up to the stockholders as owners
to decide if they should retain the Board's membership at each
annual meeting in the name of "stability" and "continuity," or make
changes as they deem fit based on director performance. That
is why corporate boards are continually being declassified across
different industries and why declassification is supported by major
institutional investors, ISS, Glass Lewis and more. Put
simply, declassification works. In fact, ISS and several
substantial shareholders have already come out publicly to support
Proposal #7.
The Board's strident resistance to
Proposal #7 is both puzzling and telling. Contrary to your
letter's assertion, my proposal does not require immediate
declassification of the Board, as the Board will of course need to
accomplish declassification consistent with the requirements of
applicable law. This kind of scare-mongering of stockholders
is reminiscent of the Company's vigorous (albeit unsuccessful)
attempts to keep stockholders from being able to consider Proposal
#7 at all by seeking agreement from the Securities and Exchange
Commission ("SEC") to refrain from enforcement action if the
Company excluded that proposal from the proxy materials for the
upcoming Annual Meeting. A reasonable stockholder pondering
these actions would understandably think twice before blindly
relying on the Board's promise that the Nominating and Corporate
Governance Committee "plans to begin the process of evaluating the
declassification of the Board in 2022." That is why passage
of Proposal #7 is so important – to communicate to the Board in
unmistakable terms (that are impossible for the Board to ignore)
what the Company's stockholders believe constitutes effective and
responsive corporate governance, whether or not the Board shares
the same view.
Second, the Board's
criticisms of my lawsuit seeking production of books and records
regarding the representations made by the Company and Mr. McGinnis
that he was the Company's second largest shareholder in 2019 are
both inaccurate and self-contradictory. Your contention that
you offered to allow me to review "the information reviewed by the
Board" in connection with its inquiry into Mr. McGinnis's holdings
is in my view a cagey attempt at revisionist history. The
fact is the Board refused to tell me what specifically you would
allow me to review or even to identify which categories of
documents you were willing to let me review, despite multiple
requests that you do so. What I "refused" to do was sign a
draconian confidentiality agreement as a condition of being allowed
to review an unknown category of documents that you yourself
concede are not privileged. Unfortunately, this stonewalling
was part and parcel of the way the Company has responded to all of
my inquiries about Mr. McGinnis's 2019 stock ownership, and it left
me with no choice but to file a lawsuit to enforce the Company's
obligations under Delaware
law. The outcome of that lawsuit is now in the Court's
hands. Stockholders can review my Complaint and judge for
themselves.
However, all of that is beside the
point in many ways. Given the clear representation in
your December 20 letter that the
Board "conducted an inquiry into the matter" of Mr. McGinnis's
stock ownership, the Board should immediately and publicly release
the results of that inquiry to all of the Company's
stockholders. All I have ever sought is the truth about a
straightforward factual question: were the representations
about who the Company's second largest stockholder was back in 2019
factually accurate or not? The Board's refusal to provide an
answer to that straightforward question with supporting
documentation is what ultimately led to my Delaware lawsuit. Even now, the Board
refuses to disclose the results of its "inquiry" to stockholders –
a remarkable fact given that the Board is affirmatively asking the
stockholders to reelect Mr. McGinnis as a director. If the
Board now has determined the answer to the question of Mr.
McGinnis's ownership and has evidence to support its conclusion,
then it should publicly set the record straight instead of
grandstanding. Transparency – rather than more obfuscation –
is what would be in the "best interest of all
stockholders."
Third, you claim this is
all about my trying to obtain a seat on the Board. Of course,
I have never hidden the fact that I want to serve my fellow
stockholders on the Board of a Company that I feel passionate
about. But the notion that my submission of Proposal #7 and
suit to enforce the Company's legal obligation to provide access to
corporate books and records are part of some elaborate ruse is, to
put it charitably, ridiculous. Surely, the Board has better
things to do with its time than assault my integrity. I would
have thought you would have tried to persuade TPL shareholders to
your point of view by making a good case on the merits rather than
engaging in ad hominem attacks. I guess I was
wrong. This Company's stockholders deserve better.
Finally, in its
December 7 proxy statement the
Company stated as follows, "Murray
Stahl, in violation of the Stockholders' Agreement, has
informed the Company in writing on December
2, 2021 that he intends to vote against the election of
Dana F. McGinnis." Does the
Company plan to comment on this point?
Gabi Gliksberg
The Company filed a definitive proxy statement on October 4, 2021, an Amendment No. 1 to the
definitive proxy statement on October 22,
2021, and a revised definitive proxy statement with the SEC
on December 7, 2021. The
definitive proxy statement filed on December
7, 2021 is available at
https://www.sec.gov/Archives/edgar/data/0001811074/000110465921147282/tm2134765d1_defr14a.htm.
Additional filings are available at the SEC's website at
http://www.sec.gov.
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SOURCE ATG Capital Management