The only thing missing is a funky ’do. An activist investor frustrated over its inability to nominate directors at Jim Cramer’s on Wednesday compared the way the board of the financial site runs the company to the way the Supreme Leader runs North Korea. “The board’s view of corporate democracy makes Kim Jong Un look like a veritable Thomas Jefferson,” Spear Point Capital said in a regulatory filing.
Spear Point believes it has the right to nominate directors to TheStreet but has been stopped because the board enacted a late rule change that requires shareholders to physically possess the stock. TheStreet’s chairman and interim chief executive, Larry Kramer, says the company is no “Money Monster. ” Kramer has spoken to Spear Point for months and in recent days reached a deal in which they would choose a new board member together with both sides having the right to veto the nominee, he said.
“Then they moved the goalposts and killed the deal,” Kramer said. Spear Point and a firm it works with have a nearly 10 percent stake in TheStreet and are trying to get the June 9 annual meeting pushed back in order to gain time to nominate directors. Kramer said that would be very difficult, since voting has already begun.
Spear Point says, “On March 10, we notified the board that we are nominating two candidates — Johannes Minho Roth and Alexius Fenwick — for the two board seats up for election at the meeting. “After more than a month’s delay … the Board informed us that they would not permit our nominations to proceed at the annual meeting, claiming we had not met one of their nomination requirements. ” A second investor did not comply with the nomination rules last year due to similar reasons, Kramer said.
He declined to comment on the company’s timing in regards to changing the guidelines. Over the past 12 months, TheStreet’s shares are down 39 percent, closing Wednesday at $1. 18.