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STUFFED FOODS LLC RECALLS FROZEN SNACK PRODUCTS DUE TO MISBRANDING AND AN UNDECLARED ALLERGEN

USDA FSIS
USDA Food Safety and Inspection Service
(202) 720-9113
[email protected]

Oasis Key Messages for Tokyo Dome Shareholders Regarding the EGM on December 17, 2020

*Shareholders must take action at the EGM to create A Better Tokyo Dome

* Shareholders should vote FOR Oasis’s shareholder proposals by circling FOR (“賛”) on the proxy form

*Shareholders must vote FOR Oasis’s proposals to stop further declines in corporate value

*The time for change and A Better Tokyo Dome is NOW

HONG KONG & TOKYO–(BUSINESS WIRE)–
Oasis Management Company Ltd. (“Oasis”) is the manager to funds that are the largest shareholder of Tokyo Dome Corporation (9681 JT) (“Tokyo Dome” or the “Company”). Oasis has adopted the Japan FSA’s “Principles of Responsible Ownership” (a/k/a the Japan Stewardship Code) and in line with those principles, Oasis monitors and engages with its investee companies.

Tokyo Dome was once the leading stadium in Japan. However, today that is simply no longer true. Tokyo Dome has not taken steps to improve the fan experience for over 30 years. Tokyo Dome has not increased its revenue or earnings for over 10 years. But shareholders can act today to change that, and create A Better Tokyo Dome.

On November 10, Tokyo Dome published a statement and held a press conference regarding the upcoming Extraordinary General Meeting of Shareholders (“EGM”). We believe this press conference further underscores Oasis’s concerns. Oasis has sought a meaningful dialogue with Tokyo Dome since 2018, and, as the largest shareholder, submitted a detailed presentation with business improvement plans. Instead of working to create A Better Tokyo Dome, 11 months after our presentation, they have held a press conference to announce that they still do not have a definitive plan for digital signage and other improvement plans suggested by Oasis.

Tokyo Dome also said in their statement that they would like Messrs. Mori and Akiyama to continue serving in their posts as independent external directors.

They say that Messrs. Mori and Akiyama have been doing good jobs and that they qualify as independent external directors according to the Company’s “Standards for Qualification of Independent External Directors”. They may technically qualify as independent directors by their own definitions, but only because their Standards for Qualification of Independent External Directors lack a standard to deny qualification based on lengthy tenure. The Japan Association of Corporate Directors set a tenure limit in 2015 of 8 years for independent external directors, and suggests that as best practice a company should disqualify an independent external director who has served in his/her such capacity for more than 8 years.

Mr. Akiyama has served for over 17.5 years and Mr. Mori for over 15.5 years as an independent external director. They have not managed to make necessary changes at the Company over the last 15.5+ years. There is no reason to believe they would now. These lengthy tenures are inconsistent with the best practices for corporate governance in Japan:

Under Japan’s Stewardship Code, it is our duty as shareholders to hold management accountable and to engage with Tokyo Dome in order to improve. Now is the moment to act to help change Tokyo Dome’s fate. We must speak up and VOTE to help save Tokyo Dome.

• Please DO support Oasis’s three shareholder proposals to dismiss the President/ Director and two other directors by circling FOR (“賛” in Japanese) printed on the proxy form for each of the three shareholder proposals and send the completed proxy form to the Company. (NOTE: If the proxy form has different instructions on how to exercise your voting rights, please follow the relevant voting instructions to indicate your support for the three Oasis shareholder proposals. If you vote via internet or your smartphone, please follow the on-screen instructions to vote in favor of the three shareholder proposals.)
• Please DON’T return the proxy form in blank to the Company, as it will be counted as a vote in support of the Company’s proposals to reject the shareholder proposals.

Oasis urges all Tokyo Dome shareholders to join Oasis in the first step for creating a Better Tokyo Dome:

VOTE AT THE EGM TO SUPPORT OASIS’S PROPOSALS TO

DISMISS PRESIDENT NAGAOKA, DIRECTOR MORI & DIRECTOR AKIYAMA.

Tokyo Dome is at a turning point. The Company needs new management who can carry out the business improvement plans in a timely manner. The Company also needs external directors who can fulfill their oversight responsibilities of new management with fresh eyes. Removing these directors is the first step toward building a Better Tokyo Dome.

We look forward to working with all shareholders and stakeholders to create a Better Tokyo Dome, and to turning Tokyo Dome into the world’s leading sporting and entertainment venue.

We encourage all shareholders to contact us with any questions at: [email protected].

About Oasis:

Oasis Management Company Ltd. manages private investment funds focused on opportunities in a wide array of asset classes across countries and sectors. Oasis was founded in 2002 by Seth H. Fischer, who leads the firm as its Chief Investment Officer. More information about Oasis is available at https://oasiscm.com. Oasis has adopted the Japan FSA’s “Principles of Responsible Institutional Investors” (a/k/a Japan Stewardship Code) and in line with those principles, Oasis monitors and engages with our investee companies.

Disclaimer:

Oasis Management Company Ltd. (“Oasis”) is the investment manager of private funds (the “Oasis Funds”) that own shares in Tokyo Dome. Oasis has created this communication and a Website – www.abettertokyodome.com – to enable fellow shareholders to carefully monitor how sincerely the board of directors and management of Tokyo Dome address our concerns, listen to shareholders’ views and endeavor to increase the value of Tokyo Dome shares in the best interest of all shareholders.

Oasis is not and should not be regarded or deemed in any way whatsoever to be (i) soliciting or requesting other shareholders of Tokyo Dome to exercise their shareholders’ rights (including, but not limited to, voting rights) jointly or together with Oasis, (ii) making an offer, a solicitation of an offer, or any advice, invitation or inducement to enter into or conclude any transaction or (iii) any advice, invitation or inducement to take or refrain from taking any other course of action (whether on the terms shown therein or otherwise). Further, this communication and the Website do not purport to recommend the purchase or sale of any security nor do they contain an offer to sell or a solicitation of an offer to buy any security. Nothing in this communication or on the Website is intended to be, nor should it be construed or used as, investment, tax or legal advice.

This communication and the Website exclusively represent the opinions, interpretations, and estimates of Oasis in relation to Tokyo Dome’s business and governance structure. Oasis is expressing such opinions solely in its capacity as an investment adviser of the Oasis Funds.

Please refer to the full disclaimer on the Website for further information.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201111005501/en/

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For all inquiries, please contact:

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KEYWORDS: China Japan Asia Pacific

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CMC MATERIALS, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS

(Unaudited and amounts in thousands)

CMC MATERIALS, INC.

Unaudited Reconciliation of Certain GAAP Financial Measures to Certain Non-GAAP Financial Measures

(Unaudited and amounts in thousands, except per share and percentage amounts)

¹ Represents adjustments to previously recorded severance liability related to the wood treatment business.
² Tax effect on the adjustments were calculated using the U.S. Federal and state blended tax rate for the respective periods as the related adjustments are mainly U.S. driven.
³ All the adjustments are related to the Selling, general and administrative expenses.
⁴ This is a reconciliation of our indicated full year net income to our adjusted EBITDA. The amounts above may not reflect certain future charges costs and/or gains that are inherently difficult to predict and estimate due to their unknown timing, effect and/or significance, including impairment charges associated with the anticipated closure of our wood treatment business. 
⁵ Amounts represent the mid-point of the current financial guidance provided on November 11, 2020.

SUPPLEMENTAL UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following Unaudited Pro Forma Condensed Combined Financial Information is presented to illustrate the estimated effects of the company’s acquisition of KMG (the “Acquisition”), which was consummated on November 15, 2018 (the “Acquisition Date”), based on the historical results of operations of CMC Materials and KMG. The following Unaudited Pro Forma Condensed Combined Statements of Income for the twelve months ended September 30, 2019 are based on the historical financial statements of CMC Materials and KMG after giving effect to the Acquisition, and the assumptions and adjustments described in the accompanying notes to these Unaudited Pro Forma Condensed Combined Statements of Income.  

The historical CMC Materials Consolidated Statement of Income for the twelve months ended September 30, 2019 was based upon and should be read in conjunction with, the CMC Materials historical audited consolidated financial statements and accompanying notes as of and for the year ended September 30, 2019 included in CMC Materials Annual Report on Form 10-K filed on November 27, 2019. The historical KMG Consolidated Statements of Income for the twelve months ended September 30, 2019 includes information derived from KMG’s books and records. Prior to the Acquisition, KMG was on a July 31st fiscal year end reporting cycle. These pro forma financials include KMG’s actual pre-acquisition results with the months aligned to CMC Materials’ fiscal periods, and therefore, they do not align with consolidated financial statements included in KMG’s Quarterly or Annual Reports on Form 10-Q or 10-K.

The Unaudited Pro Forma Condensed Combined Statements of Income are presented as if the Acquisition had been consummated on October 1, 2017, the first business day of our 2018 fiscal year, and combine the historical results of CMC Materials and KMG, which is consistent with internal management reporting, after primarily giving effect to the following assumptions and adjustments:

• Application of the acquisition method of accounting;
• Elimination of transaction costs incurred in connection with the Acquisition;
• Adjustments to reflect the new financing arrangements entered into and legacy financing arrangements retired in connection with the Acquisition;
• The exchange of 0.2000 share(s) of Cabot Microelectronics common stock for each share of KMG common stock; and
• Conformance of accounting policies.

The Unaudited Pro Forma Condensed Combined Financial Information was prepared using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the completion of the acquisition. We utilized estimated fair values at the Acquisition Date to allocate the total consideration exchanged to the net tangible and intangible assets acquired and liabilities assumed. This allocation was completed in the first quarter of fiscal year 2020. 

The Unaudited Pro Forma Condensed Combined financial information has been prepared on the basis of SEC Regulation S-X Article 11 and is not necessarily indicative of the results of operations that would have been realized had the transactions been completed as of the dates indicated, nor are they meant to be indicative of our anticipated combined future results. In addition, the accompanying Unaudited Pro Forma Condensed Combined Statements of Income do not reflect any additional anticipated synergies, operating efficiencies, cost savings, or any integration costs that may result from the Acquisition.

The historical consolidated financial information has been adjusted in the accompanying Unaudited Pro Forma Condensed Combined Statements of Income to give effect to unaudited pro forma events that are (1) directly attributable to the transaction, (2) factually supportable and (3) are expected to have a continuing impact on the results of operations of the combined company. As a result, under SEC Regulation S-X Article 11, certain non-recurring expenses such as deal costs and compensation expenses related to severance or accelerated stock compensation and certain non-cash costs related to the fair value step-up of inventory are eliminated from pro forma results in the periods presented. Certain recurring historical KMG expenses related to depreciation, amortization, financing costs and costs of sales have been adjusted as if the Acquisition had occurred on October 1, 2017.

The Unaudited Pro Forma Condensed Combined Financial Information, including the related notes included herein, should be read in conjunction with CMC Materials’ Current Report on Form 8-K/A filed on January 30, 2019, as well as our consolidated financial statements included in this release and the historical consolidated financial statements and related notes of CMC Materials and KMG, which are available to the public at the SEC’s website at www.sec.gov.

CMC Materials, Inc.

Unaudited Pro Forma Condensed Combined Statement of Income

For the Year Ended September 30, 2019

(in thousands, except per share data)

¹ KMG results that occurred prior to the Acquisition on November 15, 2018.
² Represents the reclassification of KMG distribution expenses from operating expenses to cost of sales, in order to conform with CMC Material’s accounting policies.
³ Certain pro forma adjustments related to depreciation, amortization, financing costs and costs of sales have been made for the October 1, 2018 to September 30, 2019 period assuming that the Acquisition occurred on October 1, 2017. Additionally, nonrecurring pro forma adjustments have been made for deal costs, compensation expenses related to severance or accelerated stock compensation, and the fair value step-up of inventory directly attributable throughout the twelve-month period.

CMC Materials, Inc.

Summary of Unaudited Pro Forma Adjustments

Adjustments included in the accompanying Unaudited Pro Forma Condensed Combined Statements of Income are as follows:

1. Depreciation and amortization expense are adjusted by removing depreciation and amortization associated with legacy KMG assets and assigning a pro forma expense based on the fair value of the assets on the date of the Acquisition. For periods after the date of the Acquisition, there is no pro forma adjustment for Depreciation and actual booked depreciation is reflected on a straight-line basis. Depreciation costs are allocated to costs of sales and selling, general and administrative expenses based on historical KMG allocations. Amortization costs are allocated to costs of sales or selling, general and administrative expense based on the use of the asset, where applicable.
2. Cost of sales is impacted by increased inventory balance caused by the non-cash impact of the step up to fair value of the inventory. The incremental costs of sales driven by the inventory step-up during the period have been removed.
3. During the fiscal year ended September 30, 2019, an impairment charge in the amount of $67.4 million was incurred related to the Wood Treatment business, which was acquired from KMG.  While still within the one-year remeasurement period after the Acquisition Date, it was determined that the facts and circumstances that triggered the impairment were not known, or could have been reasonably known, at the time of the transaction. Further, it was determined that the impairment charge was not directly attributable to the transaction and therefore, would not be wholly removed for purposes of pro forma reporting.  Since the impairment charge taken for September 2019 reported results was based on the actual Acquisition Date while the pro forma financials are based upon an October 1, 2017 acquisition date, the pro forma adjustment of $16.2 million to reduce the impairment charge to $51.2 million for pro forma results is required.  This adjustment reflects the difference between amortization and depreciation expense recognized post-acquisition from the earlier pro forma acquisition date vs. the amortization and depreciation expense recognized in reported results from the actual Acquisition Date. The impairment adjustment is tax effected at 25.3%, which considers the taxing jurisdictions where the impaired assets are held (United States and Mexico) and the period for which the impairment is deemed to have occurred (the twelve months ended September 30, 2019).    
4. Directly attributable and non-recurring compensation expense related to non-recurring retention expenses and stock award vesting directly attributable to the Acquisition are removed for pro forma purposes. For KMG stock awards that were replaced by CMC Material stock awards in connection with the Acquisition, the vesting for on-going service expenses are added as a pro forma adjustment.
5. The elimination of non-recurring deal costs incurred in connection with the Acquisition.
6. As a result of the Acquisition, there were non-recurring costs incurred by KMG as a result of retiring old debt. The costs associated with retiring the old debt facility and other financial instruments are removed for pro forma purposes. These instruments were retired as a result of the Acquisition and are not included in the pro forma results, which are presented as if the Acquisition had occurred on October 1, 2017.
7. Changes in interest expense as a result of financing associated with the Acquisition. The adjustments remove legacy KMG interest costs, including unused revolver fees and adds the costs associated with the new financing facilities as if the Acquisition occurred on October 1, 2017. The calculation of interest expense considers the changing LIBOR rate and uses monthly period end averages from October 1, 2017 to September 30, 2019.

We calculated the income tax effect of the pro forma adjustments using a 21.4% tax rate, which represents the weighted average statutory tax rate for the year ended September 30, 2019.

We calculated the unaudited pro forma weighted average number of diluted shares outstanding by adding the number of shares issued in the Acquisition to the amount disclosed in the historical CMC Quarterly and Annual Reports on Form 10-Q and 10-K. The basic and diluted EPS calculation takes pro forma net income divided by the applicable number of shares outstanding.

Reconciliation of Pro Forma and Non-GAAP Adjusted Pro Forma Information

The company reports its financial results in accordance with U.S. GAAP and pro forma information in accordance with SEC Regulation S-X Article 11.  However, management believes that certain non-GAAP financial measures that reflect the way that management evaluates the business may provide investors with additional information regarding the company’s results, trends and ongoing performance on a comparable basis.   These measures, referred to as,  “adjusted pro forma”, begin with pro forma results that are prepared in accordance with SEC Regulation S-X Article 11 and are then adjusted for the following additional items:

• Removal of amortization of acquisition related intangibles, since management believes that these costs are not indicative of the company’s core operating performance.
• Removal of integration expenses.
• Adjustment for U.S. Tax Reform, which represents a significant item affecting comparability among periods.
• Removal of certain costs related to a warehouse fire at KMG-Bernuth and the restructuring and asset impairment charges of wood treatment business.

Reconciliations for these items are provided below. Amounts in thousands, except per share and percentage amounts.

¹ Tax effect on the adjustments was calculated using the U.S. Federal and state blended tax rate for the respective periods as the related adjustments are mainly U.S. driven.