Calls Out Another Alarming Example of the Breakdown in Oversight, Transparency, and Risk Management Under the Incumbent Board
Urges Shareholders to Recognize This Latest Development as Another Last-Ditch Attempt to Preserve the Status Quo
Notes That Parkland’s Largest Shareholder Has Still Received No Outreach from the Board Despite Company’s Claim of Being Collaborative
Reminds Shareholders to Visit www.RefuelParkland.com to View the Full Presentation and for Details on How to Vote for All Nine of Simpson Oil’s Director Candidates on the GOLD Proxy Card Ahead of May 6 AGM
GRAND CAYMAN, Cayman Islands, April 16, 2025--(BUSINESS WIRE)--Simpson Oil Limited ("Simpson Oil", "we" or "our"), the largest shareholder of Parkland Corporation ("Parkland" or the "Company"), holding 19.8% of the outstanding common shares, today responded to the Company’s second staggering trading loss and the announcement that long-tenured CEO Bob Espey will resign—effective only at year-end.
Rather than acting decisively and terminating Mr. Espey for his performance, the Company’s board of directors (the "Board") has chosen to deliberately delay leadership change. Mr. Espey will "stay on" in his role for the rest of the year "working closely" with his hand-picked Executive Chair Michael Jennings, despite presiding over years of repeatedly missed guidance and consensus, significant management turnover, spiraling expenses, and a deeply flawed M&A strategy that has led to value destruction.
It's not clear exactly what role Mr. Jennings will have as Executive Chairman. What is clear is Mr. Jennings’ lackluster track record: during his multiple revolving-door tenures as President, CEO, and Executive Chairman of HF Sinclair, Mr. Jennings consistently underperformed against peers.1
Also left unsaid in the Company’s announcement is any description of the compensation that will be tied to Mr. Espey’s drawn-out exit, as well as Mr. Jennings’ new executive role.
Shareholders should not be fooled into believing that the CEO’s resignation is a sign the Board is finally doing the right thing.
The reality is this decision wasn’t driven by a desire to "bring resolution to the situation with Simpson Oil" or shareholder feedback about Mr. Espey's performance. It was forced upon the Board by a legal disclosure obligation: Parkland had to pre-release their first quarter earnings due to a material trading loss tied to speculative positions in the California carbon credit market—a blatant failure of risk management in a non-core area of the business the Board should have been monitoring all along. This marks the second known material trading loss incurred by the Company in recent years—the first being a $65 million loss in its U.S. business in 2022.
Out of desperation, the Board is deploying a half-baked CEO transition in an effort to distract shareholders’ attention.
We firmly believe that, but for the Company’s disclosure obligations triggered by a loss too big to ignore, the Board and Mr. Espey would have delayed this announcement until the scheduled first quarter earnings release date, one day before the Annual General Meeting (the "Meeting" or the "AGM") and once all votes were cast.
Ultimately, it’s clear this is not a real transition—it is a deliberate attempt by the Board to buy time and avoid real accountability.
Parkland’s actions to date are too little, too late. It should not take shareholder litigation, a proxy fight, or a desperate need to distract from mismanagement for the Board to do their job and exercise their fiduciary duty.
This latest development is yet another example of a reactionary Board under pressure—only responding to a situation once it becomes unmanageable, rather than demonstrating foresight and responsible governance.
In its release, the Board claims it will now begin a CEO recruitment process—but offers no explanation for how it intends to attract top-tier leadership while actively fighting a public campaign from its largest shareholder. Without resolution and alignment of the Board with shareholder interests, the process lacks credibility, invites further instability, and will fail to attract the strongest candidates. The Board’s total and complete lack of oversight of CEO succession planning has driven away several high-quality internal operators who would have been well-positioned to step into the CEO role today.
Shareholders should also be aware that, despite being Parkland’s largest shareholder, Simpson Oil has received no outreach from the Board or management since the director nominees were announced. Instead, the Company continues to spend shareholder capital entrenching itself—rather than addressing the governance and performance issues that have plagued Parkland for years. The Board has been attempting to rally support from shareholders by accusing Simpson Oil of seeking to control Parkland without paying a control premium. This is yet another blatant misrepresentation of Simpson Oil’s slate. Seven of Simpson Oil’s nine nominees for Parkland’s 13-person Board have no relationship with Simpson Oil, and Simpson Oil stands to benefit from urgent and overdue Board change equally alongside all shareholders.
Today’s announcement ultimately confirms what Simpson Oil has been saying since the launch of its campaign to nominate nine highly-qualified individuals at the AGM: Parkland is in urgent need of a refreshed Board—one that is aligned with shareholders, provides independent oversight, and supports a leadership team focused on value creation.
At a pivotal time for Parkland, and faced with the incumbent Board’s lamentable track record, shareholders should ask: is this a Board that can be trusted to make the right decisions about leadership and undertake a credible strategic review?
The answers are clear. The search for a new CEO and the conduct of a strategic review are best led by a refreshed Board that has the confidence of shareholders.
With respect to a CEO search, we have already identified several high-quality CEO candidates and believe the new Board is well-positioned and has the necessary experience to identify and attract the right leadership. Mark Davis, one of Simpson Oil’s director nominees, is fully qualified and capable of stepping in as interim CEO to ensure a smooth transition.
Enough is enough—shareholders deserve better.
Simpson Oil encourages all shareholders to visit www.RefuelParkland.com to learn more about its nine highly qualified, independent director nominees, their plan to REFUEL Parkland, and to vote GOLD for all nine ahead of the Meeting.
Proxy materials are available under Parkland’s SEDAR+ profile at www.sedarplus.ca, including a GOLD Proxy Card or voting instruction form.
The deadline to return proxies to Simpson Oil is 5:00 p.m. (Calgary time) on Thursday, May 1, 2025. If you have questions or need help voting, contact Carson Proxy, at 1-800-530-5189 (North America Toll Free), 416-751-2066 (Local and Text), or by email at info@carsonproxy.com.
Advisors
Blake, Cassels & Graydon LLP is serving as legal counsel. Longacre Square Partners is serving as strategic advisor, and Carson Proxy is serving as proxy solicitor.
1 Bloomberg data regarding Annualized Total Return vs Peers. President and CEO, July 2011 to January 2016: 13.2% underperformance vs peers. Executive Chairman, President, and CEO, January 2013 to December 2016: 13.1% underperformance vs peers. CEO, January 2020 to May 2023, 8.8% underperformance vs peers.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250416781010/en/
Contacts
Media Enquiries
Longacre Square Partners
Amy Freedman / Andy Radia
SimpsonOil@longacresquare.com
Shareholder Enquiries
Carson Proxy
Christine Carson, 416-804-0825
christine@carsonproxy.com
