8/21/2036

Kaos Capital Demands Board Overhaul at Capricor Ahead of FDA Decision on DMD Therapy

BigGo Finance (08/21/36)

Capricor Therapeutics Inc. (CAPR) is facing an activist campaign from shareholder Kaos Capital, which is demanding immediate board changes, a cash-preservation plan, and the creation of an M&A committee just one day before the U.S. Food and Drug Administration (FDA) is scheduled to act on the company's experimental Duchenne muscular dystrophy therapy. Kaos Capital, a Miami-based investment firm that describes itself as a "significant and growing shareholder," issued a letter to fellow shareholders on August 21 calling for a meeting with the board within 15 business days. The firm said it intends to nominate two independent directors and push for a board-led M&A and Strategic Alternatives Committee chaired by a shareholder-backed director. The activist campaign lands at a precarious moment for Capricor. The FDA's action date on deramiocel, the company's cell therapy for DMD-related cardiomyopathy, is August 22. In June, an FDA advisory panel voted 9-3 against the drug's use for that indication, casting significant doubt over its approval prospects. Capricor shares were down approximately 2% at the time of the letter's release. In the letter signed by CEO Adam Arviv, Kaos argued that Capricor has become overly dependent on a single regulatory outcome and must take immediate steps to preserve capital while exploring acquisitions, licensing deals, and partnerships that could broaden its pipeline. The company reported $237.9 million in cash, cash equivalents, and marketable securities as of June 30, down roughly $80.2 million from year-end 2025. First-half 2026 operating expenses totaled $79.7 million, including $23.5 million in general and administrative costs — approximately double the comparable 2025 figure, according to the letter. Kaos called for a formal Cash Preservation Plan that would include: a near-term freeze on nonessential spending; a zero-based review of G&A expenses; enhanced approval requirements for material commitments; and quarterly reporting on cost reductions, cash runway, and capital use. The firm also urged the board to retain independent legal advisers and commission a review of oversight, disclosure controls, contracting, compensation, and capital-allocation processes. Kaos cited "numerous legal matters and shareholder demands" disclosed in Capricor's public filings, including securities and derivative actions, a Section 220 books-and-records demand, a patent action, a distribution dispute, and employment-related claims. A further securities class action was filed against the company and certain officers in 2026. "This legal overhang carries cost, distraction, reputational risk, and governance consequences," the letter stated. Kaos emphasized it is not asking Capricor to abandon deramiocel, which it believes "may still have meaningful value for patients." Instead, the firm wants the company to use its cash and public-company platform to build a broader, multi-modality biotechnology enterprise. The proposed M&A committee should evaluate assets in inflammation, fibrosis, tissue repair, targeted delivery, and regenerative medicine, the letter said. Kaos specifically pointed to advanced small-molecule pharmacology targeting the NLRP3/inflammasome signaling pathway as one area of interest. "Conviction in a lead program is not a license for a Board to concentrate all of a public company's capital, risk, and future in a single regulatory outcome," Arviv wrote. The activist push comes as Capricor awaits the FDA's decision on deramiocel. The agency's action date is August 22, though the timeline has grown complicated. After the advisory committee's negative vote in June, Capricor said the FDA was willing to review an amendment containing 24-month Hope-3 data focused on upper-limb function. A new target date has not been formally announced. Roth Capital expects the FDA review could be extended by approximately three months to accommodate the additional data. Kaos said it is prepared to work constructively with the board but warned of escalation if its demands are not met. If the board does not confirm and convene the requested meeting within the specified timeframe, Kaos said it will begin seeking shareholder support to elect its two independent nominees, replace directors, and potentially pursue removal of senior management. "We do not take that step lightly, but continued inaction would leave shareholders no reasonable alternative," the letter read.

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9/10/2026

Palliser Adds WUS Stake, Eyes Undervalued Taiwan Firms

Bloomberg (09/10/26) Lin, Miaojung; Hou, Betty

Palliser Capital increased its stake in Taiwan-based WUS Printed Circuit Co. (TPE: 2316) to more than 5%, up from 4.3%, as it searches for companies positioned to benefit from artificial intelligence and the Nvidia value chain. Palliser founder and Chief Investment Officer James Smith said Taiwan is currently one of the firm’s most attractive markets and that it has several potential investment targets there. WUS, a manufacturer of advanced circuit boards used in data centers, fits Palliser’s strategy because the fund sees the company as deeply undervalued, with limited research coverage and a significant gap between its market valuation and its perceived potential. Palliser typically targets companies valued at about $1 billion to $10 billion and favors businesses without a controlling family or government shareholder. In June, the fund urged WUS to consider measures to increase shareholder value, including a possible privatization. Smith also identified Taiwan’s financial and real estate sectors as potential opportunities because industry consolidation could unlock value. Japan remains another focus for Palliser, which has invested in Ajinomoto (TYO: 2802) and Toto (TYO: 5332) and pushed both to better capitalize on underappreciated semiconductor-related businesses. Smith said complex corporate structures and information gaps can leave Japanese companies overlooked, although companies have become more proactive in engaging foreign investors.

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9/10/2026

Mandatory Cumulative Voting Rattles Boardrooms as Revised Commercial Act Takes Effect

Herald Business (South Korea) (09/10/26) Eun-gyeol, Ko

South Korea’s revised Commercial Act takes effect with mandatory cumulative voting for listed companies with assets of at least 2 trillion won and an expansion in the number of audit committee-track directors elected separately from one to two. Under cumulative voting, shareholders can concentrate their votes behind a single director candidate, increasing the ability of minority, institutional, foreign, and individual investors to secure board representation. Activist funds are also expected to become more active in nominating candidates and forming shareholder alliances. Companies have responded by taking steps to reduce the likelihood of minority-backed candidates gaining seats. Among 332 large listed companies analyzed, the number of registered executives fell 1.9% from the previous year, while the number of audit committee members increased 1%. The separately elected audit committee directors are subject to a 3% voting limit on the largest shareholder and related parties, potentially giving pooled minority shareholders greater influence. Companies may increasingly focus on persuading key shareholders, evaluating director independence and expertise, and negotiating with activist investors. The changes could also make boardroom disagreements more frequent when directors backed by controlling and minority shareholders have conflicting interests, potentially complicating decision-making and takeover defenses.

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9/10/2026

Major Novartis Shareholder Calls for Board Shake-Up After Drug Trial Setbacks

Reuters (09/10/26) Hirt, Oliver; Kaesebier, Marleen

A major shareholder in Novartis (NOVN.S) has called for a shake-up of the Swiss drugmaker's board to improve corporate governance after its shares suffered a record fall this week following back-to-back trial setbacks. David Samra, managing director at Artisan Partners and founding partner of International Value Group, said successive chairmen had failed Novartis on acquisitions and that the company needed to change how it oversees deals. "The party is over," Samra told Reuters in an interview, urging Novartis Chairman Giovanni Caforio to act. Asset manager Artisan is among Novartis' 20 largest shareholders, according to LSEG Workspace data. "I think he needs to make changes at the board level. One of them should be on improving the team that's doing these deals because clearly they have been uninspiring at best." On Tuesday, a muscle-wasting disorder drug acquired through Novartis' $12 billion takeover of U.S. firm Avidity failed a late-stage study, sending the company's shares tumbling more than 10% and wiping nearly $30 billion off its market value. "The party is over," Samra told Reuters in an interview, urging Novartis Chairman Giovanni Caforio to act. Asset manager Artisan is among Novartis' 20 largest shareholders, according to LSEG Workspace data. "I think he needs to make changes at the board level. One of them should be on improving the team that's doing these deals because clearly they have been uninspiring at best." On Tuesday, a muscle-wasting disorder drug acquired through Novartis' $12 billion takeover of U.S. firm Avidity failed a late-stage study, sending the company's shares tumbling more than 10% and wiping nearly $30 billion off its market value. Novartis' stock had already fallen 3% a day earlier after results from heart drug pelacarsen disappointed investors. Artisan is the first investor to publicly call for board changes, though others have voiced concerns about Novartis' M&A strategy to Reuters. Public pressure from shareholders can often encourage other investors to push for change. "If you do a $12 billion deal and it goes to zero, the management needs to be penalized for that," Samra said, while noting that other promising drugs could still emerge from the Avidity acquisition. Novartis said in a statement that it's financial guidance was unchanged by recent setbacks and that it had a "broad" pipeline of medicines. "We continue a disciplined and shareholder friendly approach to capital allocation by investing in the organic business, pursuing value-creating bolt-ons, and returning capital to shareholders through a growing annual dividend and share buybacks," it said. Samra also cited Novartis' 2024 acquisition of German biotech MorphoSys as a disappointing deal. Investor enthusiasm faded after Novartis wrote down the value of the acquisition only months later. Many analysts have viewed the latest setbacks as a test of Novartis CEO Vas Narasimhan, who has led the company since 2018. But Samra said he did not blame Narasimhan, arguing he had done a "very good job" running the business, and instead questioned whether the board had exercised sufficient scrutiny over deals. "The acquisition track record is not very good," Samra said, arguing that deals had destroyed value. Samra also urged the board to overhaul Novartis' compensation structure, saying it relies too heavily on adjusted performance measures that exclude writedowns rather than reflecting "real economic outcomes."

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9/10/2026

Ethan Allen Investor Plans to Conduct Own CEO Search

Bloomberg (09/10/26) Sun, Mengqi

DGB Investments founder Douglas Bergeron is forging ahead with his campaign at furniture maker and retailer Ethan Allen Interiors Inc. (NYSE: ETD), launching his own search for a new chief executive officer and adding further pressure on the company. Bergeron, a former public company executive who disclosed his campaign last month, has selected a global executive search firm for the process, according to a draft of a statement reviewed by Bloomberg News. The investor has identified potential candidates and received unsolicited interest from executives for the CEO role, according to the statement. Bergeron has also filed a preliminary proxy statement with the U.S. Securities and Exchange Commission, setting the stage for a potential proxy fight. Bergeron is seeking full control of Ethan Allen’s board and has nominated five candidates, including himself and former executives at eBay Inc. (NASDAQ: EBAY), Wayfair Inc. (NYSE: W), and Neiman Marcus Group. The announcement of the CEO search could come as soon as Thursday, according to people familiar with the matter who asked not to be identified because it isn’t yet public. Bergeron has been pushing Ethan Allen to replace CEO Farooq Kathwari, who has held that position and served as chairman since 1988. He said the management and board are over-tenured and have an outdated strategy that fails to help the company grow, Bloomberg News previously reported. A representative for Ethan Allen didn’t immediately respond to a request for comment. Kathwari, in an interview on Bloomberg TV in August, defended his leadership, saying the furniture store is focusing on long-term retail sales over short-term digital sales. He added the board had never raised the issue of succession with him. Kathwari said the company has been focusing on its showrooms and providing in-person and interior design services to its customers over online and other sales channels. Ethan Allen reported a 5.7% year-over-year decline in net sales for the fiscal year ended June 30. The Danbury, Connecticut-based company offers free interior design service to clients and sells a range of home furnishings, including dressers, sofas and wall decor. The company’s shares, which have fallen 26% over the past year, closed at $21.71 on Wednesday in New York, giving Ethan Allen a market value of $547 million. DGB Investments, which is Bergeron’s family office, and his family trusts, have disclosed a stake of 5.2% in the company. Ethan Allen has a strong foundation with its brand and manufacturing capabilities in North America, but its strategy lacks digital initiatives, Bergeron contends. He said Ethan Allen has the potential to triple shareholder value over the next three years. “Without a new, brand-focused strategy, disciplined capital allocation and materially improved execution across digital marketing and retail, Ethan Allen will continue to shrink, and shareholders will pay the price,” Bergeron said Friday in a statement. Bergeron and the other nominees have been working to identify key qualities for a successful CEO candidate who could revitalize the Ethan Allen brand, including a track record of operating leadership and experience in retail and consumer businesses, according to the draft statement. Kristine Miller, a Bergeron nominee who was eBay’s chief strategy officer, will be leading the search, with support from the other nominees, according to the draft. Bergeron, based in Park City, Utah, previously served as a co-managing partner at Hudson Executive Capital. In that role, he ran a successful proxy fight in 2020 at self-service payment technology firm Cantaloupe Inc. (NASDAQ: CTLP) that led to a full board turnover, with him serving as the company's chairman. Cantaloupe was sold this year for $848 million to retail technology firm 365 Retail Markets.

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9/9/2026

Alabama Bank Blasts Investors’ Request to Join Board

Banking Dive (09/09/26) Ennis, Dan

United Bancorporation of Alabama (OTCMKTS: UBAB) on Wednesday slammed a request by two investors to join the bank’s board. Aaron Sallen, manager at Merion Road Capital Management, and Jason Blumberg, managing member at Blue Hill Advisors, wrote an open letter to United on Tuesday, asserting the bank had failed to provide them with feedback on concerns they expressed in July. Sallen and Blumberg urged the $1.4 billion-asset lender, at the time, to make better use of its equity, control its expenses and add more board members with expertise in capital allocation. In particular, the investors called out a $123 million capital windfall from a Treasury Department program and proposed a $40 million stock buyback. “Despite our long engagement and investor support, we have not seen any tangible progress from the Board in addressing or acting on our proposals,” Sallen and Blumberg wrote Tuesday. Merion Road and Blue Hill together own roughly 2% of United's shares. “Inaction is not an option,” Sallen and Blumberg wrote. “High-level discussions are not a substitute for concrete analysis and decisive action.” United, however, disputed the investors’ characterization of “inaction,” saying it’s “fully committed to acting in the best interests of all stockholders, including the approximately 98% of the Company’s investor base unassociated” with Merion Road and Blue Hill. The bank said it had “engaged constructively on numerous occasions with the Activist Group” – notably, on a video call Aug. 31. “At no point during our meeting, or in any prior meetings, did Jason Blumberg or Aaron Sallen indicate they both would like to join the Board,” the bank said. “Yet, just hours after our August 31st meeting ended, we received an email making this demand and requesting a response within seven days.” United called the request “unreasonable,” adding the investors “did not even account for standard processes and timelines associated with director candidate vetting.” Agreeing to Sallen and Blumberg’s request “would have been a rash decision and undermined the interests of investors holding the other 98%” of United’s shares, the bank said Wednesday. United also defended the expertise of its board, saying it’s “regularly assessed … to ensure that it has the right skills and experience to advance the best interests of all stockholders.” Both sides appeared to associate their actions with recent improvements on the bank's stock performance. Sallen and Blumberg asserted Tuesday that United's shares had risen more than 15% since they published their July letter, compared with a 1% increase for the broader Nasdaq Bank Index and 2% for the S&P 500. Meanwhile, United on Wednesday said “leadership’s focus on long-term value creation has supported total stockholder returns of more than 129% over the past five years.” That includes $41 million returned to stockholders through dividends and share repurchases in the past two years, the bank said. United last month reported $11.3 million in profit for the first half of 2026. That’s up roughly 21.5% over the same time frame last year, the bank noted. “We plan to continue driving value by building on our trajectory of loan and deposit growth and reaching top-tier profitability,” United said Wednesday. “We also intend to maintain a disciplined and balanced approach to capital allocation, while retaining the ability to act swiftly on opportunities for inorganic growth.” Sallen and Blumberg, for their part, said Tuesday they “recognize that the Board must conduct an appropriate evaluation of our qualifications, and we welcome the opportunity to meet directly with the independent directors as part of that process.” United on Wednesday said that while it “remain[s] open to ongoing engagement with the Activist Group, we do not believe it will be beneficial or constructive to continually issue public statements in response to [its] expanding and shifting demands.” Investors pushed several banks to make changes in the past year or so. Most notably, HoldCo Asset Management sued Fifth Third (NYSE: FITB) and Comerica in the lead-up to the two banks' combination. The investor argued the deal was “rushed” and sealed because it offered then-Comerica CEO Curt Farmer “a lucrative post-closing role.” HoldCo later lodged unsuccessful bids against KeyBank (NYSE: KEY) and Eastern Bank (NASDAQ: EBC). Diligence Capital Management pressed Maryland-based EagleBank (NASDAQ: EGBN) in March to develop a performance improvement plan and replace three board members. Blue Hill is no stranger to investor activism. The firm repeatedly made unsolicited counteroffers to buy Honolulu-based Territorial Bancorp in 2024, in the face of Los Angeles-based Hope Bancorp's ultimately successful bid to acquire the Hawaii lender.

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