Post Blasts Williams' Record of 'Earnings Disappointments'

That's when shareholders will vote either to have the former company chairman replace David Stockert as president and CEO or keep Stockert and the REIT's existing slate of directors and other executive officers.

In its first formal reply to Williams' two-week-old proxy fight to regain control of the company he founded in 1971, a prepared Post statement says "if Mr. Williams succeeds, it is unlikely that the company would be able to attract qualified management in the future."

The statement says Williams has nothing to show but a string of wrong decisions made during his reign in the executive suite.

"Mr. Williams' recent legacy at Post is one of overly rapid geographic expansion into unfamiliar markets, substantial cost overruns and missed schedules on new developments, with lease-up rates below projections," the statement says. Williams also posted "a series of quarterly earnings disappointments, beginning with Post's Oct. 2, 2000 pre-announcement and continuing through 2001."

The unsigned statement says Post's total shareholder returns "underperformed the multifamily peer group [as identified by Mr. Williams in an April 7 SEC filing] for the five-year period prior to his resignation as CEO" on July 1, 2002.

"Mr. Williams' departure as CEO and chairman was directly correlated to his failure to plan for the future and his reluctance to relinquish authority," the statement says. "Now, through his proxy contest, he is trying to undermine his appointed successor [Stockert] in order to regain control of Post."

In the same statement, Post chairman Robert C. Goddard III, says "members of this board have long-standing personal and professional relationships with John Williams and several have served with him on Post's board for many years. Notwithstanding Mr. Williams' many contributions to Post over the years, the board has been dismayed by his failure to constructively support a transition to new leadership and his persistent efforts to undermine current management."

Goddard says, "Under Dave Stockert's leadership, the board is confident that Post is now moving in the right direction." The Post chairman says "if Mr. Williams intends to solicit proxies, we are happy to put management's track record and plan up against his and let the shareholders decide. We look forward to moving beyond the distraction of Mr. Williams' proxy contest, and to delivering on Post's potential and enhancing value for all Post shareholders."

Post has retained Merrill Lynch & Co. as its financial adviser; New York-based Skadden, Arps, Slate, Meagher & Flom LLP as its legal adviser; and Innisfree M&A Inc. of New York as its proxy solicitor. Williams has hired New York-based Citigroup Global Markets and The Espy Co. as his financial advisers.

In an April 7 filing with the Securities and Exchange Commission, Williams blames the company's "deteriorating operating performance…and the erosion of the value of the common stock" to the existing management's inability "to effectively address the adverse market and economic conditions that now confront the company."