MMI Investments Issues Letter to Chemed Stockholders Illustrating the Superior Qualifications of the MMI Nominees
28 April 2009 - 3:00PM
PR Newswire (US)
NEW YORK, April 28 /PRNewswire/ -- MMI Investments, L.P. ("MMI
Investments") today sent a letter to Chemed Corporation's
("Chemed") (NYSE: CHE) stockholders along with their proxy
statement urging stockholders to elect MMI Investments' five
independent and highly qualified nominees to Chemed's board.
Chemed's 2009 annual meeting of stockholders is scheduled to be
held on May 29, 2009, at 11:00 a.m. local time at The Queen City
Club located at 331 East Fourth Street, Cincinnati, Ohio (the
"Annual Meeting"). Stockholders of record as of March 31, 2009 are
entitled to vote at the Annual Meeting. MMI Investments President
and Chemed director nominee, Clay B. Lifflander, stated: "MMI
Investments has nominated director candidates for Chemed's board
that are, in our opinion, superior to the incumbents we oppose in
operational and strategic credentials, relevant industry experience
and independence from the current board and management. We believe
that's the way corporate directors should be elected: on the basis
of being the best qualified, not the sons of former chairmen,
management insiders and lawyers for the company. Yet that's the
profile of the incumbent directors we oppose. We believe the MMI
Investments nominees offer a far better choice, and encourage
Chemed stockholders to support the MMI Investments nominees by
voting the GOLD proxy card." The full text of the letter follows:
ELECT MMI'S SUPERIOR DIRECTOR NOMINEES TO BRING EXPERIENCE,
INDEPENDENCE AND STRATEGIC CREDENTIALS TO CHEMED'S BOARD VOTE YOUR
GOLD PROXY CARD TODAY April 28, 2009 Dear Fellow Chemed
Stockholder: MMI Investments, L.P. ("MMI Investments"), a long-only
investment fund and owner of 3.5% of Chemed Corporation's
("Chemed") outstanding capital stock, is seeking your support for
five highly qualified, independent and experienced director
candidates (the "MMI Nominees") for election to Chemed's
eleven-member board at the 2009 annual meeting of stockholders (the
"Annual Meeting"). The MMI Nominees are Scott J. Cromie, James Foy,
Clay B. Lifflander, Peter A. Michel and Carroll R. Wetzel, Jr. We
note that we are soliciting proxies on the GOLD proxy card to elect
not only the five MMI Nominees, but also the candidates who have
been nominated by Chemed other than Patrick P. Grace, Thomas C.
Hutton, Walter L. Krebs, Donald E. Saunders and George J. Walsh
III. The chart on the following page in our opinion clearly
illustrates the superiority of the MMI Nominees to the Chemed
incumbents we oppose, whether by measures of operating and
strategic credentials or independence from Chemed management and
the rest of the board. We encourage you to consider which slate is
better equipped to maximize value for Chemed stockholders, and urge
you to support the MMI Nominees by signing, dating and returning
the enclosed GOLD proxy card. Of the five incumbent directors we
oppose, two are sons of former Chemed Chairmen, two are practicing
attorneys with no operational experience, four are current or
former employees of Chemed or a former affiliate, and one is a
former paid service provider to Chemed as recently as 2007. These
incumbent directors have a total of only 21 months experience in
industries currently relevant to Chemed, no outside public company
director experience beyond Chemed and its past affiliates and an
average tenure as Chemed director of 16 years. In contrast, the
five MMI Nominees bring decades of relevant operational experience
in both of Chemed's two industries: healthcare administration (35
years) and residential services (36 years), a strong track record
of public company board service and effective governance, strategic
alternatives review and execution expertise, and total
uncompromised independence and stockholder alignment. CONSIDER THE
RISK-REWARD ANALYSIS OF SUPPORTING THE MMI NOMINEES: -- The Chemed
incumbents we oppose have financial and/or familial ties to Chemed
and virtually no relevant operational experience, despite decades
of employment with Chemed. -- The MMI Nominees have significant
experience in Chemed's sectors, superior public company board
credentials, and unquestioned independence and alignment with
stockholders. IF NOT FOR INCUMBENCY, WOULD THERE EVEN BE A
QUESTION? To view the chart illustrating biographical information
and comparing the credentials of the MMI Nominees and the Chemed
incumbents we oppose included in the letter mailed to stockholders,
please click
http://www.viewourmaterials.com/mmi-chemed/NomineeTable . THE MMI
NOMINEES HAVE ONLY ONE GOAL: MAXIMIZING VALUE FOR CHEMED
STOCKHOLDERS After several years as a stockholder, nearly a dozen
in-depth meetings with Chemed senior management and much time,
effort and research into Chemed's operations, strategic
alternatives and corporate governance, MMI Investments concluded
that Chemed's board is in desperate need of significant change and
we have nominated five independent directors who are committed to
maximizing stockholder value. We do not seek board representation
for stockholders lightly. We are not seeking control of the board
and we do not have any singular agenda for Chemed. What we do have
are significant concerns about the independence of the incumbent
board and a lack of confidence that, without stockholder
representation, Chemed's board will act in the best interests of
stockholders. CHEMED STOCKHOLDERS DESERVE AN EXPERIENCED,
INDEPENDENT BOARD WITHOUT MANAGEMENT INSIDERS, SONS OF FORMER
CHAIRMEN AND VENDORS TO THE COMPANY Even after adding two new,
independent and qualified director candidates to its slate, the
Chemed board remains, based upon our research, a tangled web of
nepotism and interrelationships, mostly financially compensated. We
note that prior to nominating two new director candidates, ten of
Chemed's eleven directors had significant ties to the company that
compromised their independence, and the eleventh, while technically
independent, has no relevant operational experience and was a
personal friend of the former chairman prior to joining the board.
Three independent members of an eleven member board does not
constitute good governance. Independence matters -- particularly
when a board must objectively make decisions to maximize value for
stockholders, including deciding whether to separate two completely
unrelated businesses, and in doing so dismantle an outdated,
expensive and unnecessary corporate infrastructure. Dismantling the
Chemed board's cronyism alone would be a vast improvement in our
opinion, but the MMI Nominees offer much more: superior credentials
to the incumbents we oppose in relevant operational experience,
public board service and strategic alternatives expertise.
Furthermore, with the MMI Nominees added to the board, Chemed would
have a vastly improved corporate governance profile. We urge all
stockholders to support the MMI Nominees and send a message to the
incumbent board of Chemed that independence and experience matter
by signing, dating and returning the enclosed GOLD proxy card
today. Sincerely, MMI Investments, L.P. CERTAIN INFORMATION
CONCERNING THE PARTICIPANTS MMI Investments, L.P., a Delaware
limited partnership ("MMI Investments"), together with the other
participants named below, has made a definitive filing with the
Securities and Exchange Commission ("SEC") of a proxy statement
(the "Proxy Statement") and an accompanying proxy card to be used
to solicit votes in connection with the solicitation of proxies in
support of its director nominees at the 2009 Annual Meeting of
Stockholders of Chemed Corporation (the "Company"). MMI INVESTMENTS
ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT
AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION. IN ADDITION, THE PARTICIPANTS
IN THE PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY
STATEMENT WHEN AVAILABLE WITHOUT CHARGE UPON REQUEST. REQUESTS FOR
COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR,
MACKENZIE PARTNERS, INC. BY CALLING (800) 322-2885. ANY SUCH PROXY
MATERIALS WILL ALSO BE AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE
AT http://www.sec.gov/ AND MMI INVESTMENTS' WEBPAGE AT
http://www.viewourmaterials.com/MMI-CHEMED. The participants in the
proxy solicitation are MMI Investments, MCM Capital Management, LLC
("MCM"), which is the general partner of MMI Investments, John S.
Dyson, who is Chairman and a voting member of MCM, Clay B.
Lifflander, who is President and a voting member of MCM, Scott J.
Cromie, James Foy, Peter A, Michel and Carroll R. Wetzel, Jr. (the
"Group"). As of April 27, 2009, MMI Investments beneficially owned
800,000 shares of capital stock, $1 par value per share (the
"Common Stock"), of the Company, which shares represent
approximately 3.5% of the outstanding Common Stock, and Mr. Cromie
beneficially owned two shares of Common Stock. Except for the
shares owned by MMI Investments and Mr. Cromie, which each member
of the Group may be deemed to beneficially own under SEC rules,
none of the other members of the Group beneficially owns any Common
Stock of the Company. Additional information concerning MMI
Investments and the other members of the Group is included in the
Proxy Statement. If you have any questions, require assistance in
voting your GOLD proxy card, or need additional copies of MMI's
proxy materials, please contact MacKenzie Partners, Inc. at the
address or phone numbers listed below. MACKENZIE PARTNERS, INC. 105
Madison Avenue New York, New York 10016 (212) 929-5500 (Call
Collect) or CALL TOLL FREE (800) 322-2885 DATASOURCE: MMI
Investments, L.P. CONTACT: Investors, Mark Harnett of MacKenzie
Partners, Inc., +1-212-929-5877; or Media, Jeff Siegel of Monarch
Communications, +1-516-569-4271, both for MMI Investments, L.P.
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