PREIT issued a statement and letter in response to the June 15, 2023 Open Letter to Shareholders issued by Trustees, Christopher Swann and Kenneth Hart.
Statement from PREIT:
PREIT welcomes and values the opinions of all shareholders and its Trustees alike and is open to any input that may help advance the goals of the Company and its various stakeholders. While the Company doesn’t intend to explicitly reveal private discussions amongst the Board and its counsel, the Company’s counsel has offered a formal Opinion regarding the process that has been undertaken to consider the individual offers of resignation received. Of maximum importance to the Board is the stability of the Company and its operations during a critical period.
A comprehensive response to Messrs. Swann and Hart can be found below:
Dear Christopher and Kenneth:
This is the Board’s response to your June 15th Open Letter to Shareholders. As an initial matter, we believe that your letter leaves out critical facts and creates a misleading narrative. For example, you neglect to mention in your letter that the Board received an Opinion from outside counsel expressly approving the process utilized by the Board in response to the shareholder vote. In addition, contrary to your self-serving assertion that you are “independent trustees,” Counsel’s Opinion noted that the Board’s business judgment with respect to a conflict of the Preferred Shareholder nominees was justified. In fact, as Counsel pointed out, you were elected by an entirely separate class of shareholders whose rights and preferences are not always aligned with the Common Shareholders and who have diverging and conflicting interests on various matters. Further, as the Board made clear to you in prior correspondence, the Board recognizes the importance of the Common Shareholder vote and is taking appropriate action.
In fact, both of you participated in the Board discussion regarding the Guideline process that you are now challenging, but at the time failed to raise an objection. Moreover, your decision to now raise these issues in a public forum, we believe, is not the proper way for a Board member to act and causes us a concern that you have a different agenda.
Notwithstanding the above, the Board reasonably believes, in its business judgment, that under the circumstances facing the Company, to delay acting on the offered resignations would destabilize the Company, which clearly is not in the best interests of the shareholders and all other stakeholders. This is not, as you allege, a “rushed process,” but rather a prudent course to prevent harm to the Company. Any delay acting on the offered resignations would cause considerably more harm to the Company and, in fact, as you well know, the Board has already considered the issues raised in your Open Letter to the Shareholders.
Rest assured the Board takes the Shareholder vote and the issues you raised in your letter seriously and seeks to constructively address them. To that end, we encourage you to raise your concerns through the normal process at the upcoming Board meeting.
Joseph F. Coradino, Chairman and
Michael DeMarco, Lead Independent Trustee