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IsZo Capital Issues Letter to Nam Tai Shareholders Regarding its Slate's Strategic VisionIsZo Capital Management LP (together with its affiliates, "IsZo"), a significant long-term shareholder of Nam Tai Property Inc. (NYSE: NTP) ("Nam Tai" or the "Company") with beneficial ownership of approximately 10% of the Company's outstanding shares, today issued a letter to shareholders in connection with its efforts to convene a meeting of Nam Tai shareholders (the "Special Meeting"). IsZo recently announced that it delivered to Nam Tai verified requests to convene the Special Meeting from holders of more than 40% of the Company's outstanding shares (well in excess of the 30% required to convene the Special Meeting). The Special Meeting will provide shareholders an opportunity to reconstitute Nam Tai's Board of Directors by removing a majority of the incumbent directors and installing six highly-qualified and independent individuals: Michael Cricenti, Cindy Chen Delano, Bo Hu, Louis Leung, Paula J. Poskon and Jeffrey Tuder. IsZo also wants to take this opportunity to urge Nam Tai to respect the will of shareholders and promptly schedule the Special Meeting. In addition to the fact that a critical mass of shareholders has requested the Special Meeting, the market has expressed significant enthusiasm for change at Nam Tai since IsZo first initiated its campaign earlier this year. The Company's share price has appreciated approximately 2.5x since our first letter on May 27, 2020. The full text of today's letter is available at www.FixNTP.com and included below. Dear Fellow Shareholders, IsZo Capital Management LP (together with its affiliates, "IsZo") believes the actions and public communications issued by Nam Tai Property Inc. ("Nam Tai" or the "Company") in recent months collectively represent a clear indication that meaningful change is urgently needed in the boardroom. We believe it is important for shareholders to understand that a Board of Directors (the "Board") controlled by allies of Kaisa Group Holdings Limited ("Kaisa") cannot be trusted and that IsZo's slate of director candidates is offering a superior strategic vision. We believe it is quite notable that one business day after IsZo delivered to Nam Tai verified requests to convene a meeting of shareholders (the "Special Meeting") from holders of more than 40% of the Company's outstanding shares, the Company announced that Chief Executive Officer and Chairman Ying Chi Kwok was immediately resigning from his positions. This recent announcement followed Nam Tai's August 5th proclamation that "Mr. Kwok has made significant progress driving value for shareholders" despite a -56.85% total shareholder return ("TSR (News - Alert)") over his tenure.1 Shareholders should recognize that Nam Tai's announcement pertaining to Mr. Kwok's departure is only the latest in a string of contradictions and misrepresentations that the Company has disseminated. While Nam Tai will now likely claim that it is embracing shareholder feedback and taking steps to enhance value, we question how any shareholder can have faith in what remains a Kaisa-controlled Board. We contend the Company's recent communications, including its August 5th press release, feature a litany of misleading statements that completely impugn the Board's credibility, including:
ISZO'S SLATE OF DIRECTOR CANDIDATES HAS THE RIGHT STRATEGY FOR UNLOCKING THE SIGNIFICANT UPSIDE VALUE TRAPPED WITHIN NAM TAI'S SHARES IsZo appreciates the fact that shareholders have been receptive to our calls for change. The market's enthusiasm is evidenced by the fact that Nam Tai's shares have appreciated approximately 2.5x since our first public communication in May of this year. As we now await the Special Meeting, IsZo believes it is important for shareholders to know that its slate of director candidates has spent considerable time working together to assess Nam Tai's assets, corporate governance, investor communication and disclosure practices, and approach to allocating capital and managing its project portfolio. Given that our slate includes individuals with significant experience working within China's real estate sector, we have also been able to closely analyze the markets in which Nam Tai is currently developing properties. Our slate's disciplined strategy focuses on realizing the intrinsic value of Nam Tai's current portfolio - which the Company has failed to properly emphasize - prior to committing any additional capital to new investments and continuing to spread the Company's resources thin. By installing IsZo's six director candidates and positioning a refreshed Board to implement a structured plan, we believe the intrinsic value of Nam Tai's existing projects can finally be unlocked. Nam Tai's most recent valuation reports imply that its project portfolio is worth up to $40 per share, which is approximately 4x the Company's current share price. Prior to releasing a comprehensive and more detailed presentation ahead of the Special Meeting, we want to share an overview of the key points anchoring our slate's strategy:
Although this is just a high-level summary of our slate's strategy, we believe it should be clear that a well-structured and targeted plan is in shareholders' best interests. There is no reason to allow the Kaisa-controlled Board to continue wasting shareholders' capital when the Company has failed to deliver any meaningful value to date. In our view, Kaisa-affiliated insiders have proven themselves either incapable or unwilling to represent the best interests of all shareholders. We are pleased that our fellow shareholders recognize that they deserve better as demonstrated by the overwhelming support to call the Special Meeting. THE SPECIAL MEETING WILL EMPOWER SHAREHOLDERS TO REMOVE AND REPLACE KAISA ALLIES AND INSIDERS ON (News - Alert) THE BOARD We urge shareholders to reject Nam Tai's appeal to give the Board more time to prioritize its own interests, and view the Company's defensive and reactionary changes as nothing more than ploys to benefit Kaisa. It should be clear based on the extremely strong market reaction to IsZo's efforts in recent days and months that many shareholders support the prospect of board-level change at Nam Tai. IsZo hopes this enthusiasm continues to grow now that our slate has provided an overview of a clear and viable strategy. IsZo also wants to note at this time that we firmly believe it is in the best interests of Nam Tai to maintain a degree of boardroom continuity and retain two incumbent directors with strong institutional knowledge and unimpeached integrity. To that end, our director candidates are very excited by the prospect of working with Peter Kellogg and Mark Waslen to relentlessly pursue the results that shareholders deserve. In closing, Iszo wants to stress that it is a long-term investor - one that is 100% committed to acting as a catalyst for meaningful, value-enhancing change at Nam Tai. We will not be deterred by the Kaisa-controlled Board's groundless attacks or any additional maneuvers it may be planning. IsZo is not going anywhere. Sincerely,
Brian Sheehy
Shareholders interested in learning more about the Special Meeting process should contact IsZo's solicitor, Saratoga Proxy Consulting, at [email protected] or (212) 257-1311. We also encourage shareholders to learn more about our slate and its analysis of Nam Tai at www.FixNTP.com.
1 TSR figure accounts for dividends reinvested and runs from the close of trading on January 29, 2018 (the day Mr. Kwok was appointed Chief Executive Officer) to the close of trading on May 26, 2020 (the day before IsZo issued its first public communication to shareholders).
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