Sean Leder Files 2nd Amendment to Consent Solicitation

As originally appeared in Troubled Company Reporter.

PICO Holdings, Inc. (Nasdaq:PICO), based in La Jolla, Calif., is a diversified holding company reporting recurring losses since 2008. PICO owns 57% of UCP, Inc. (NYSE:UCP), 100% of Vidler Water Company, Inc., a securities portfolio and various interests in small businesses. PICO has $676 million in assets and $431 million in shareholder equity. Central Square Management LLC and River Road Asset Management LLC collectively own more than 14% of PICO and have agitated for governance and financial changes. Sean Leder owns 1% of PICO shares and seeks shareholder authorization to call a Special Meeting to remove and replace five directors. Other activists at have taken to the Internet to advance the shareholder cause.

On February 18, 2016, Sean Leder filed a Second Amendment to the Consent Solicitation with the Securities and Exchange Commission.

The filing contains two informative and pertinent charts. One relates to the history of capital allocation and economic results at PICO. The other cumulates historical compensation information for PICO CEO John Hart.

Mr. Leder adjusts his director proposal to reflect the latest additions. As three PICO Director seats have turned over in the last 2 months, he proposes to only appoint 4 new directors, instead of 5 previously contemplated.

Mr. Leder proposes to keep the 3 new directors — Eric Speron, Howard Brownstein and Raymond Marino, while jettisoning the four “Legacy Directors” — Mr. Hart (PICO Director 19 years), Carlos C. Campbell (18 years), Kenneth J. Slepicka (11 years), and Michael J. Machado (3 years).

Mr. Leder advises if the Board appoints additional directors prior to the Special Meeting, making four directors less than a majority, “we intend to evaluate legal remedies that may be available to us to invalidate such appointment.”

Mr. Leder discloses that he has spent $50,000 so far on the campaign.

Since the last SEC filing, Mr. Leder’s firm purchased an additional 32,000 PICO shares.

Mr. Leder repeats that there may be room for compromise: “Specifically, we may decide to withdraw the request for the Special Meeting if the Board takes meaningful steps to respond to shareholder concerns, including the appointment of nominees to the Board acceptable to Leder Holdings.”

Separately, on February 19, 2016, PICO announced that newest Director Howard Brownstein was appointed Chair of the Audit Committee.