Schedule 13d
| Filed by: | WINTERGREEN ADVISERS, LLC |
| Subject Company: | CONSOLIDATED-TOMOKA LAND CO |
| Filed as of Date: | 12/23/2008 |
| View Original Filing on Edgar's | |
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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
SCHEDULE
13D
THE
SECURITIES EXCHANGE ACT OF 1934
(Amendment
No. 18)*
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Consolidated-Tomoka
Land Co.
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(Name
of Issuer)
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Common
Stock, par value $1.00 per share
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(Title
of Class of Securities)
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210226106
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(CUSIP
Number)
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David
J. Winters
Wintergreen
Advisers, LLC
333
Route 46 West, Suite 204
Mountain
Lakes, New Jersey 07046
(973)
263-2600
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(Name,
Address and Telephone Number of Person Authorized to Receive
Notices
and Communications)
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December
22, 2008
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(Date
of Event Which Requires Filing of this
Statement)
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If
the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of ss.240.13D-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box [_].
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Note: Schedules
filed in paper format shall include a signed original and five copies of
the schedule, including all exhibits. See § 240.13d-7
for other parties to whom copies are to be sent.
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* The
remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover
page.
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The
information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of
the Act (however, see the Notes).
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CUSIP
No.
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210226106
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1.
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NAME
OF REPORTING PERSONS
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I.R.S.
IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Wintergreen
Advisers, LLC
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2.
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
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(a)
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[_]
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(b)
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[X]
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3.
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SEC
USE ONLY
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4.
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SOURCE
OF FUNDS*
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AF
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5.
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CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
OR 2(e)
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[_]
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6.
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CITIZENSHIP
OR PLACE OF ORGANIZATION
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Delaware,
USA
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NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
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7.
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SOLE
VOTING POWER
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1,481,474
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8.
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SHARED
VOTING POWER
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0
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9.
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SOLE
DISPOSITIVE POWER
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1,481,474
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10.
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SHARED
DISPOSITIVE POWER
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[_]
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0
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11.
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AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
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PERSON
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1,481,474
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12.
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CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
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CERTAIN
SHARES*
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13.
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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25.9%
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14.
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TYPE
OF REPORTING PERSON*
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IA
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CUSIP
No.
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210226106
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1.
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NAME
OF REPORTING PERSONS
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I.R.S.
IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Wintergreen
Fund, Inc.
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2.
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
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(a)
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[_]
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(b)
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[X]
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3.
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SEC
USE ONLY
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4.
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SOURCE
OF FUNDS*
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WC
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5.
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CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
OR 2(e)
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[_]
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6.
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CITIZENSHIP
OR PLACE OF ORGANIZATION
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Maryland,
USA
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NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
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7.
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SOLE
VOTING POWER
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0
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8.
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SHARED
VOTING POWER
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564,961
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9.
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SOLE
DISPOSITIVE POWER
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0
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10.
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SHARED
DISPOSITIVE POWER
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[_]
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564,961
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11.
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AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
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PERSON
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564,961
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12.
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CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
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CERTAIN
SHARES*
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13.
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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9.9%
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14.
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TYPE
OF REPORTING PERSON*
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IC
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CUSIP
No.
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210226106
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1.
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NAME
OF REPORTING PERSONS
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I.R.S.
IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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Wintergreen
Partners Fund, LP
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2.
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
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(a)
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[_]
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(b)
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[X]
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3.
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SEC
USE ONLY
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4.
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SOURCE
OF FUNDS*
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WC
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5.
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CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
OR 2(e)
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[_]
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6.
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CITIZENSHIP
OR PLACE OF ORGANIZATION
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Delaware,
USA
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NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
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7.
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SOLE
VOTING POWER
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0
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8.
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SHARED
VOTING POWER
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548,788
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9.
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SOLE
DISPOSITIVE POWER
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0
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10.
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SHARED
DISPOSITIVE POWER
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[_]
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548,788
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11.
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AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
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PERSON
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548,788
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12.
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CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
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CERTAIN
SHARES*
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13.
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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9.6%
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14.
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TYPE
OF REPORTING PERSON*
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PN
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CUSIP
No.
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210226106
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Item
1.
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Security
and Issuer.
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Consolidated-Tomoka
Land Co. (the “Issuer”), Common Stock, par value $1.00 per share (the
“Shares”).
The
address of the Issuer is 1530 Cornerstone Boulevard, Suite 100 Daytona
Beach, Florida 32117.
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Item
2.
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Identity
and Background.
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(a-c,
f)
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This statement is being filed
by
(i) Wintergreen Fund, Inc, an
investment company registered under
the Investment Company Act of 1940, as
amended (“Wintergreen Fund”), (ii) Wintergreen
Partners Fund, LP, a US Private Investment Fund (“Wintergreen Partners”)
and (iii) Wintergreen Advisers, LLC, a Delaware limited
liability company (“Wintergreen”) which acts as sole investment
manager of the Wintergreen
Fund, Wintergreen Partners and other
investment vehicles. (Each of Wintergreen Fund,
Wintergreen Partners and Wintergreen may be referred to herein
as a “Reporting Person” and collectively may be
referred to as “Reporting Persons”). The Managing
Members of Wintergreen are David
J. Winters and Elizabeth N. Cohernour (the “Managing
Members”), each of which is a
citizen of the United States. David J.
Winters is the portfolio manager at
Wintergreen and Elizabeth N.
Cohernour is
the chief operating officer at
Wintergreen.
The principal business
and principal office address of each of
the Managing Members, Wintergreen Fund, Wintergreen Partners and
Wintergreen is 333 Route 46 West, Suite 204, Mountain Lakes,
New Jersey.
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(d)
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None
of the Managing Members or Reporting Persons have, during the last
five years, been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
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(e)
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None
of the Reporting Persons or the Managing Members have, during
the
last five years, been a party to a civil proceeding of
a judicial or administrative body of competent
jurisdiction and as a result of such proceeding were or
are subject to
a judgment, decree or
final order enjoining future
violations of, or prohibiting or
mandating activities subject to, Federal or state
securities laws or finding any violation with respect to such
laws.
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Item
3.
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Source
and Amount of Funds or Other Consideration.
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As
of the date hereof Wintergreen may be
deemed to beneficially own 1,481,474 Shares.
As
of the date hereof Wintergreen Fund beneficially owns 564,961
Shares.
As
of the date hereof Wintergreen Partners beneficially owns 548,788
Shares.
The
source of funds used
to purchase the securities reported herein
was the working capital of Wintergreen Fund, Wintergreen
Partners and other investment vehicles managed by
Wintergreen. The aggregate funds used
by the Reporting Persons to make the purchases was
approximately $90.9 million. No borrowed funds were
used to purchase the Shares, other than
any borrowed funds used for working capital purposes in the
ordinary course of business.
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Item
4.
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Purpose
of Transaction.
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Advisory
clients of Wintergreen are the beneficial owners of approximately 25.9% of
the Issuer’s common
stock. Wintergreen has
initiated discussions with the
Issuer on maximizing the
value of the Daytona
properties, through direct development or
partnerships. Wintergreen intends to continue its dialogue
with, and to take an active interest in, the
Issuer to encourage strategic focus on the Volusia
county properties. To this end, Wintergreen from time to time,
will communicate with the
Issuer and other holders of Common
Stock regarding such matters.
On
December 22, 2008, Wintergreen delivered a letter (the “December 22
Letter”) to the Secretary of the Issuer in response to comments made by
the Issuer in a Form 8-K filing dated November 21, 2008. A copy of the
December 22 Letter is attached hereto as Exhibit B and incorporated herein
by reference. Reference is made in the December 22 Letter to the March 12,
2008 resignation of James Jordan as director of the Board of the Issuer
(the “March 12 Letter”). A copy of the March 12 Letter is attached hereto
as Exhibit C and incorporated herein by reference.
Wintergreen
may in the future purchase additional Shares or dispose of some or all of
such Shares in open-market transactions or privately negotiated
transactions. Wintergreen does not currently have any plans or proposals
that would result in any of the actions described in paragraphs (b)
through (j) of Item 4 of the instructions to Schedule 13D.
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Item
5.
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Interest
in Securities of the Issuer.
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(a,
b)
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As
of the date hereof, Wintergreen may be deemed to be the beneficial owner
of 1,481,474 Shares, constituting 25.9% of the Shares of the Issuer, based
upon 5,727,515 Shares outstanding as of the date of this filing.
Wintergreen has the sole power to vote or direct the vote of 1,481,474
Shares; has the shared power to vote or direct the vote of 0 Shares; has
sole power to dispose or direct the disposition of 1,481,474 Shares; and
has shared power to dispose or direct the disposition of 0
Shares.
Wintergreen
specifically disclaims beneficial ownership in the Shares reported herein
except to the extent of its pecuniary interest therein.
(a,
b) As of the date hereof, Wintergreen Fund is the beneficial owner of
564,961 Shares (1), constituting 9.9% of the Shares of the Issuer, based
upon 5,727,515 Shares outstanding as of the date of this
filing.
Wintergreen
Fund has the sole power to vote or direct the vote of 0 Shares; has
the shared power to vote or direct the vote
of 564,961 Shares; has sole power to
dispose or direct the disposition of 0 Shares; and has shared
power to dispose or direct the disposition of 564,961 Shares.
(1) Wintergreen Fund
has delegated all of its authority to vote or dispose of the
Shares to Wintergreen, its investment manager.
(a, b)
As of the date hereof, Wintergreen Partners is the
beneficial owner of 548,788 Shares (1),
constituting 9.6% of the Shares of the Issuer, based
upon 5,727,515 Shares outstanding as of the date of this
filing.
Wintergreen
Partners has the sole power to vote
or direct the vote of 0 Shares; has the
shared power to vote or direct the vote of 548,788 Shares; has
sole power to dispose or direct the
disposition of 0 Shares; and has shared
power to dispose or direct the disposition of 548,788
Shares. (1) Wintergreen Partners has
delegated all of its authority to vote or dispose of the Shares to
Wintergreen, its investment manager.
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(c)
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Wintergreen caused
its advisory clients to effect transactions in the Shares
during the past 60 days as set forth below:
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DATE
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TYPE
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NO
OF SHARES
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PRICE/SHARE
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(d)
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Inapplicable.
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(e)
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Inapplicable.
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Item
6.
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Contracts,
Arrangements, Understandings or Relationships with Respect
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to
Securities of the Issuer.
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N/A
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Item
7.
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Material
to be Filed as Exhibits.
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Exhibit
A: Agreement between the Reporting Persons to file jointly
Exhibit
B: Letter to Secretary of Issuer dated December 22, 2008
Exhibit
C: Resignation letter from James Jordan dated March 12,
2008
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SIGNATURE
After
reasonable inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and
correct.
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Wintergreen
Advisers, LLC
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By:
David J. Winters, Managing Member
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/s/
David J. Winters
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Wintergreen
Fund, Inc.
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By:
David J. Winters, Executive Vice President
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/s/
David J. Winters
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Wintergreen
Partners Fund, LP
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By:
Wintergreen GP, LLC
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By:
David J. Winters, Managing Member
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/s/
David J. Winters
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December
23, 2008
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Attention: Intentional
misstatements or omissions of fact constitute Federal criminal violations (see
18 U.S.C. 1001).
Exhibit
A
AGREEMENT
The
undersigned agree that this Amendment No 18 to Schedule 13D dated December 23,
2008, relating to the Common Stock, par value $1.00 per share of
Consolidated-Tomoka Land CO. shall be filed on behalf of the
undersigned.
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Wintergreen
Advisers, LLC
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By:
David J. Winters, Managing Member
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/s/
David J. Winters
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Wintergreen
Fund, Inc.
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By:
David J. Winters, Executive Vice President
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/s/
David J. Winters
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Wintergreen
Partners Fund, LP
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By:
Wintergreen GP, LLC
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By:
David J. Winters, Managing Member
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/s/
David J. Winters
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December
23, 2008
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Exhibit
B
Wintergreen
Advisers, LLC
333 Route
46 West
Suite
204
Mountain
Lakes, NJ 07046
Consolidated-Tomoka
Land Co
c/o Linda
Crisp, Corporate Secretary
Post
Office Box 10809
Daytona
Beach, FL 32120-0809
December
22, 2008
Dear Ms.
Crisp:
This
letter is in response to Consolidated-Tomoka Land Co.’s (“CTO”) November 19,
2008 letter to Wintergreen Advisers (“Wintergreen”) and CTO’s Form 8-K filing of
November 21, 2008.
We take
serious exception to your extreme misrepresentations of
facts. Wintergreen continues to have the same interest it has had
from our very first meeting with CTO - to pursue the best interests of all
CTO shareholders. Your November 19th letter
and November 21st 8-K
filing contain extensive mischaracterizations of Wintergreen’s strategic
recommendations to the Board.
Since you
made public your November 19, 2008 letter by filing it with the SEC, Wintergreen
is compelled to publicly correct many of the inaccuracies contained in such
letter.
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-
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CTO
did recently offer Wintergreen two Board seats, but the offer was included
in a CTO proposed standstill agreement that contained preconditions that
were unacceptable to Wintergreen, and which were to last for a period of
three years. The CTO proposal demanded:oWintergreen would have
to agree to vote in favor of any director recommended by CTO without
regard to director candidate qualifications or
conflicts
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·
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Wintergreen
would have to agree to vote against any proposal made by any third party
in advance of knowing what fellow shareholders
propose
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·
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Wintergreen
would have to give up its right under Florida statute to inspect company
books and records
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·
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Wintergreen
would have to agree not to propose matters for a vote by all
shareholders
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·
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Wintergreen
would have to agree to not attempt to influence CTO’s Board, management,
or policies
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·
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Wintergreen
would have to forgo the right to buy more CTO
shares
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·
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Wintergreen
would have to forgo the right to seek legal remedy for any potential
malfeasance on the part of CTO, its officers, and directors discovered by
Wintergreen in our inspection
process
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-
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In
your November 19, 2008 letter, you also claim that Wintergreen seeks to
gain control of CTO. This is simply not
true. Wintergreen seeks to have a board of directors whose
loyalties lie with the company and its shareholders and not with either
CTO’s management or Wintergreen. We reiterate that the
directors we proposed are in no way affiliated with Wintergreen, nor would
they represent or report to Wintergreen once on the CTO
Board. They would merely act as overseers of management and of
the corporate assets which belong to CTO’s shareholders. This
objective representation of long term shareholder interests by individuals
with meaningful, diverse backgrounds and expertise without any conflicting
business or social obligations is in the best interests of all CTO
shareholders. This is not control of the board by
Wintergreen. This is board representation for the benefit of
all shareholders.
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At this
time, CTO board members and management own approximately 2% of the outstanding
stock of the company. That ownership has been largely acquired
through granting of stock and stock appreciation rights by the board to
management. There does not appear to be any significant purchase of
CTO stock by current board members.
As we
look to the other 98% of CTO stock, it has been purchased by investors like
Wintergreen. However,
all of those investors and Wintergreen lack any representation
on the Board. The
true owners of CTO have absolutely no voice with regard to the stewardship of
their company.
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-
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You
imply that having the full board of directors being elected annually for
one year terms rather than
having a third of the board elected each year for three year terms –the
de-staggering the Board – would somehow “confer considerable power”
upon Wintergreen. All
shareholders are empowered when they have the annual opportunity to
vote for each director. Shareholders deserve the
opportunity to annually express support or dissatisfaction with the
board.
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In point
of fact, it is a widely supported best practice of corporate governance to give
shareholders the right to annually vote for the full board. This is
simply good corporate governance policy, and the majority of S&P 500
companies have de-staggered boards[1]. De-staggering
the Board will grant the 98% of all CTO shareholders an appropriate and
meaningful voice. The approximately 2% of CTO stock owned by
management would also have an appropriate voice in director
election.
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-
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CTO
contends that by granting Board seats to Wintergreen’s independent
candidates and de-staggering the Board, Wintergreen would be “in a
position to assert majority
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control
of the Board by 2010.” This overlooks the fact that any
proposal to de-stagger the Board, made by Wintergreen or other
shareholders, would require the affirmative vote of a super-majority of
CTO shareholders and any proposed nominees for election as director would
require the affirmative vote of a majority of
shareholders.
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|
-
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CTO
categorizes the resignation of Wintergreen–nominated Board member Jim
Jordan as voluntary, while failing to mention that Mr. Jordan voluntarily
resigned at least in part because of his negative view of the conduct of
the Board and of the Nominating and Corporate Governance
Committee. At the time of his resignation, Mr. Jordan stated
“it is a mistake to combine the titles of Chairman and Chief Executive
Officer, which goes against now generally accepted best practice in
corporate governance” and “it was a mistake not to consider the candidates
proposed by our largest shareholder, or other candidates, as part of our
due diligence.” Mr. Jordan also stated that, on the
issue of director candidates, those issues “should first have been vetted
through the Nominating and Corporate Governance Committee, which did not
happen.”
|
Statements
such as these by a former director would give any thoughtful investor
concern about whether the Board is functioning properly and in the best interests of all
shareholders. We have included a copy of Mr. Jordan’s
resignation letter as an attachment to this letter.
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|
-
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In
your November 19th
letter, CTO states that Wintergreen has advocated abandoning your 1031
income property strategy. This is a complete
mischaracterization. What we have conveyed to CTO management
and directors is that we are concerned with several aspects of your
current strategy, including:
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·
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CTO
has entered into many flat, long-term leases which do not allow CTO to
increase rents over time. Generally, in the leases which do
call for rent increases over time, the rent adjustments are so
insignificant that they would not keep pace with historical rates of
inflation. While these properties do produce steady cash flows,
they do not provide meaningful pricing power to CTO, or significant upside
with regard to future values.
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·
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CTO
management and Board members represented to Wintergreen that CTO often
reviews the income property portfolio and considers selective sales of
properties. Yet as the market for these properties peaked along
with the rest of the real estate market in the past three years, CTO
continued to buy more properties at capitalization rates in the 6% to 7%
range, versus the 8% to 9% range captured when the strategy was first
implemented in 2001. Had some properties been sold out of
inventory over the past few years when real estate prices were high, tens
of millions of dollars could be available for more productive
uses. Sale of a handful of these properties could have funded
all the necessary road and infrastructure projects on company owned land
for years to come. At this point in time, we
believe the income property portfolio is in need of a rational and
intelligent review.
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·
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The
crown jewels of CTO’s assets are the approximately 11,000 acres of
unencumbered land straddling several major roads on the east coast of
Florida. Approximately 8,000 of these acres are
contiguous. This asset could never be
duplicated. Yet management is pursuing a strategy which
requires selling off this precious and limited land in order to buy
commoditized retail properties. If the CTO board and management
continue to let this approach run its course, shareholders will have
traded valuable plots of land with long term development potential for a
portfolio of income properties scattered across the southeastern
U.S.
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|
-
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You
contend that we have advocated for you to discontinue land
sales. In point of fact, we have consistently encouraged you to
abandon your stated corporate goal of “accelerating the rate of annual
sales.” Rather than the mass liquidation of property which
appears to be CTO’s current plan, we have encouraged CTO to sell parcels
of land more selectively. We fully understand that certain
sales must be made to fund the development of the western Daytona Beach
lands and to encourage the westward growth of the city. For
instance, the sale of land to a local hospital will create a need for new
doctor’s parks, retail malls and other facilities to support the
hospital. However, instead of pursuing the development of these
support facilities for the long-term benefit of shareholders, CTO seems
intent on selling this land and allowing others to capture the upside
potential these developments create. CTO should be developing and holding
on to most of these properties, which would give the company a portfolio
of properties with the ability to raise rents and participate in the
long-term appreciation of their Volusia County
landholdings.
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With
regard to your dividend and stock repurchase policy, we find it odd that
you belittle Wintergreen in your November 19th
letter for advocating a reduced dividend in order to focus on better uses
of that cash (e.g., developing roads across your land or buying back
stock). The very next day, CTO declared a reduced dividend so
that you may repurchase your stock. Since our very first
meeting with CTO, we have expressed our belief that the approximately $2
million the company spent on annual dividends could be better used to
develop much needed roads and infrastructure to increase the value of
company lands. Perhaps now CTO will finally begin work on
Stagecoach Road, the much needed three mile road connecting LPGA Boulevard
and State Road 40. Management has spoken of the desirability of
this road for years, with no visible progress made as of
yet.
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At
no point has Wintergreen encouraged CTO to take on “significant debt”
which would put the company in “severe financial distress;” this is a
complete misrepresentation on your part. On the contrary, the company’s
lack of considerable debt is one of the attributes that makes CTO such an
interesting investment situation.
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You
state that had CTO followed the strategies Wintergreen has recommended,
you would be facing “potential high vacancy rates in new self-developed
properties.” This is a gross distortion of the
facts. Wintergreen has never advocated speculatively
constructing building after building on company lands without any
forethought into
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who
would fill the space. Quite to the contrary, we have encouraged
CTO to build prudently on company land, only after the company has
contracted tenants lined up.
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We have
consistently conveyed to the company our belief that there are immense
opportunities
for sensible self-development, and we would discourage wanton speculation
in the construction market. The gradual westward growth of the
city of Daytona
Beach into company lands has provided, and will continue to offer, value
to those with the vision and capital to capture it.
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It
is peculiar that your letter mentions potential vacancies at speculative
self-developed properties without mentioning the current vacancies at the
Mason Commerce Center, the two 15,000 square foot buildings which the
company built before management had lined up tenants to fill the
space. The responsibility for any vacancies and the potential
accompanying negative cash flows from the construction of these buildings
belongs exclusively to CTO management and board members. This
is not a course of action which was at any time promoted by
Wintergreen.
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In
your letter, you articulate a belief that Wintergreen has “expressed very
strong support for the Company’s management team and our strategy and
business plan.”
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Our
support of CTO management was contingent upon our belief that management was
interested in increasing long term shareholder value. From the
time of our initial filing with the SEC on May 5, 2006 until our January 22,
2008 filing we were of the opinion that we could rely on the expressed
willingness of CTO management and board to be open to new ideas and strategies
regarding self-development and alternate business strategies. It was only after we
observed a lack of progress on the part of CTO’s management with respect to new
ideas and strategies aimed at increasing shareholder value that we realized the
best interests of all shareholders were not being attended
to.
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In
our January 22, 2008 SEC filing, we began to more clearly express our
desire for CTO to focus on its Volusia County properties
(“Wintergreen has initiated discussions with the
issuer on maximizing the
value of the Daytona properties,
through direct development or
partnerships. Wintergreen intends to continue its dialogue
with, and to take an active interest in, the Issuer to encourage strategic
focus on the Volusia county properties”). Had the company
proven itself more open to the ideas of its shareholders and truly
independent outside directors, the current situation would have been
avoided.
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I
reiterate the need for representation of the interests of the 98% owners of CTO
who actually purchased their shares, rather than the 2% of shares owned by
management and board members, much of which was gifted to them. There is inherent conflict with
members of the current board who, while appearing to meet the test of
independence under the listing standards of the NYSE Alternext exchange, are
part of an intersecting web of business and personal relationships with CTO and
each other that bring their practical independence into
question. The proper director’s role is to look out for the
interests of all CTO shareholders rather than personal business
interests.
We do not
take pleasure in the adversarial turn our relationship with CTO has
taken. Wintergreen generally enjoys healthy shareholder-management
relationships and currently has no other 13-Ds on file with the Securities and
Exchange Commission, nor shareholder proposals with any other portfolio
company. However, as a significant shareholder of CTO stock, we feel
we must be the advocate of better management, business strategy, and corporate
governance for all shareholders.
We remain
concerned about past misrepresentations on your behalf, in both letters and
conversations with Wintergreen, regarding CTO’s business strategy and
dealings. The handling of the LPGA golf courses also causes us great
concern, as CTO continues to lose over one million dollars annually on these
operations, with no visible progress towards improving, or disposing of, the
business.
In
summary, we have no desire to “gain control of Consolidated-Tomoka,” nor a
desire to micromanage the company, and the proposals we offered in our
standstill agreement are to the benefit of all CTO shareholders. Our
director candidates are totally independent from Wintergreen and would represent
the interests of all shareholders. We did not nominate them to push a
certain agenda or business plan, but rather to act as intelligent and
independent stewards of CTO’s assets. They will not report back to
Wintergreen on the dealings of the company any more than they will report to all
other shareholders. The Wintergreen proposed independent
directors offer an array of backgrounds, talents, and viewpoints that we believe
would undoubtedly help the company maximize shareholder value in the long
run.
We will
take this opportunity to remind you, once again, that CTO continues to be in
violation of both Florida Statute (Section 607.1602), and your own corporate
bylaws with regard to our demand to inspect corporate books and
records. Shareholders of the company have a right to demand copies of
corporate records, and we have requested corporate records to enable Wintergreen
to determine whether the affairs of CTO are being properly administered by CTO’s
corporate officers and to ascertain the value of CTO’s stock. As of
this date, Wintergreen has not received responsive electronic documents, nor the
complete results of your search for responsive emails and other documents stored
in archive format. CTO’s bylaws state in section 6.6, Form of Records that,
“Any records maintained by the corporation in the regular course of its
business, including its stock ledger, books of account, any minute books, may be
kept on, or be in the form of, punch cards, magnetic tape, photographs,
microphotographs, or any other information storage device, provided that the
records so kept can be converted into clearly legible form within a reasonable
time. The corporation shall so convert any records so kept upon the
request of any person entitled to inspect the same.” Florida statute
requires CTO to produce such documents within five days of receipt of notice. It
has now been six months that have passed since our initial inspection
request. While we realize document requests may be burdensome to the
company and that CTO has provided some corporate records, there are huge
omissions in what is anticipated by statute and general good business
practice. CTO’s lack of disclosure with respect to significant
records “within a reasonable time” is in violation of Florida statute and
corporate by-law. We encourage you to provide the requested records
as expeditiously as possible.
Sincerely
yours,
/s/
David J. Winters
David J.
Winters, Managing Member
Wintergreen
Advisers, LLC
Exhibit
C
James E.
Jordan
March 12,
2008
Robert D.
Allen, Chairman, and
William
H. McMunn, President & CEO,
The Board
of Directors
Consolidated-Tomoka
Land Company
1530
Cornerstone Blvd - Suite 100
Daytona
Beach, Florida 32117
Dear Bob
and Bill:
Following
our last Board meeting, I have given serious thought to the general direction of
the Company, and to certain specific decisions made at that last meeting, and
have concluded that I must resign from the Board, effective
immediately.
My
reasons are as follows: As you know, my view is that it is a mistake to combine
the titles of Chairman and Chief Executive Officer, which goes against now
generally accepted best practice in corporate governance. In seeking
candidates to fill an anticipated Board vacancy, it was a mistake not to
consider the candidates proposed by our largest shareholder, or other
candidates, as part of our due diligence. Indeed, I believe those and
related issues should first have been vetted through the Nominating and
Corporate Governance Committee, which did not happen. I have also
long opposed the payment of a dividend, given our largely long-term,
value-oriented, institutional shareholder base; and was disappointed with the
decision not to adopt a potential buy-back plan. On the broad subject
of Company strategy, now would be a particularly good time to develop
alternative strategies for the use of the company’s land and cash flows to
maximize shareholder value over time.
On all
these issues, of course, I recognize that my views are only those of one
director, but feeling as I do, it is best that I step aside now.
Sincerely
yours,
/s/
James E. Jordan
SK 25133 0011
950416
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