Embarcadero Technologies Inc. (NDAQ:EMBT) founds itself in the cross hairs of Chapman Capital once again today as Robert Chapman demanded that Director Gary Haroian immediately resign from the company's board of directors. "Mr. Haroian has been compensated into the hundreds of thousands of dollars while acting out the part of a 'career
director' on the boards of Embarcadero, Aspen Technology, Inc., Lightbridge, Inc., Network Engines, Inc., and Phase Forward Inc.," said Chapman in a press release. "In
order to reinstate any semblance of obeying his responsibility to the
owners of these public companies, Mr. Haroian should resign from
whichever boards necessary to allow for his adequate attention and
focus on the remaining issuers."
Chapman went on to say: "Public company directors hiding shamelessly and disingenuously behind a convenient but ignorant interpretation of Regulation Fair Disclosure, in order to shirk their fiduciary duties of due care and loyalty, are a plague being visited upon Wall Street. Instead of committing the time and effort to understand issuers' operations, financial condition, strategic positioning and management performance, these expensive substitutes for true corporate governors attempt to obfuscate their parasitic ineptitude behind the facade of Reg. FD compliance. There exists no section, guideline or other language within Reg. FD that restricts the discussion of material, public or immaterial, non-public information between public company directors and owners. At the risk of stating the obvious, the fact that public information being targeted for discussion had been disclosed previously makes Mr. Haroian's pretext for 'owner avoidance' patently absurd."
These harsh words come only days after the acitivist hedge fund demanded that Embarcadero immediately put itself up for sale. Further, Chapman said he would seek nominees to replace Class I directors Timothy C.K. Chou and Frank M. Polestra, and Class II directors Michael J. Roberts and Samuel T. Spadafora, should a sale of Embarcadero not be announced by March 30, 2007. This is a great stock to keep an eye on in the event that management folds to the pressure; after all, while proxy fights are rarely won by hedge funds, most companies bend under the pressure and institute at least a compromise.
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