Shareholder Value Committee Announces Proxy Contest in Open Letter to Shareholders Of Celebrate Express, Inc.
August 07 2006 - 3:48PM
PR Newswire (US)
NEW YORK, Aug. 7 /PRNewswire-FirstCall/ -- The Celebrate Express
Shareholder Value Committee issued today the following letter to
shareholders of Celebrate Express, Inc. (NASDAQ:BDAY): THE
CELEBRATE EXPRESS SHAREHOLDER VALUE COMMITTEE c/o Spencer Capital
Management, LLC 1995 Broadway, Suite 1801 New York, New York 10023
August 7, 2006 Dear Fellow Celebrate Express Shareholder: As you
may be aware from our recent Schedule 13D filings, members of The
Celebrate Express Shareholder Value Committee collectively own
approximately 19% of the shares outstanding. As the largest
shareholders of Celebrate Express, we are very concerned about the
Company's future. Over the last several months, we have had
numerous discussions with management and members of the Board about
the direction of the Company. In those discussions, we requested
two Board seats in order to provide to the Board, on an ongoing
basis, perspectives that would benefit all shareholders equally.
Despite our owning almost one-fifth of the Company's stock, this
request was squarely rejected, as was a suggestion by a current
member of the Board -- which we were prepared to consider at the
time -- that we be given just a single Board seat. We are now
convinced, however, that we must have even greater Board
representation than we previously requested in order to influence
the Company's strategic direction in a meaningful way. Recent Board
actions alarm us as shareholders: only last month, in an apparent
response to our efforts, the Board unilaterally implemented a
poison pill and adopted several bylaw amendments aimed at limiting
shareholder rights. Significantly, the Board changed the Company's
bylaws so that a majority of the Company's shareholders can no
longer amend them. Rather, a supermajority of 66. % of the
outstanding stock is now required. As a result, we have notified
the Company that we intend to propose a slate of three nominees for
election to the Board at the 2006 Annual Meeting of Shareholders,
which we expect will be held in October. Currently, there are six
directors on the Board, and we believe that three of the six
directors must be put up for election at the Annual Meeting. If
elected, our nominees will push to establish a Board committee to
consider and pursue strategic alternatives for the Company,
including a possible sale of the Company. We believe this is a
necessary step toward maximizing value for all shareholders, and a
process that should be undertaken immediately. However, even if the
Board heeds our call for an immediate process of exploring
strategic alternatives, we believe additional shareholder
representatives must be added to the Board. We think that a
strategic alternatives process would benefit greatly both from the
input of our nominees and from the mandate that the election of our
nominees would represent. We hope you will support us in this
endeavor. Once our preliminary proxy materials are filed with the
SEC, we will seek to communicate with many of you directly, with
the help of our proxy solicitors at D.F. King & Co., Inc.
Sincerely, Kenneth H. Shubin Stein, MD, CFA Stephen Roseman, CFA
Spencer Capital Management, LLC Thesis Capital Management, LLC THE
CELEBRATE EXPRESS SHAREHOLDER VALUE COMMITTEE STRONGLY ADVISES ALL
STOCKHOLDERS OF THE COMPANY TO READ ITS PROXY STATEMENT WHEN IT IS
AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION, INCLUDING
INFORMATION RELATING TO THE PARTICIPANTS IN ANY SUCH PROXY
SOLICITATION. ANY SUCH PROXY STATEMENT, WHEN FILED, AND ANY OTHER
RELEVANT DOCUMENTS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S
WEBSITE AT http://www.sec.gov/. IN ADDITION, STOCKHOLDERS MAY ALSO
OBTAIN A COPY OF ANY SUCH PROXY STATEMENT, WHEN FILED, WITHOUT
CHARGE, BY CONTACTING OUR PROXY SOLICITOR, D.F. KING & CO.,
INC., AT ITS TOLL-FREE NUMBER: (800) 735-3591, OR AT . The
following persons are anticipated to be, or may be deemed to be,
participants in any such proxy solicitation: The Celebrate Express
Shareholder Value Committee; Kenneth H. Shubin Stein, MD, CFA;
Stephen Roseman, CFA; Matthew C. Diamond; Spencer Capital
Management, LLC ("SCM"); Spencer Capital Opportunity Fund, LP
("SCF"); Spencer Capital Partners, LLC ("SCP"); Spencer Capital
Offshore Opportunity Fund, Ltd. ("SCOF"); Spencer Capital Offshore
Partners, LLC ("SCOP"); Thesis Capital Management, LLC ("TCM");
Thesis Capital, LP ("TC"); and Thesis Capital Master Fund Limited
("TCMF"). Certain of these persons hold direct or indirect
interests through the beneficial ownership of common stock as
follows: Dr. Shubin Stein and SCM -- 1,200,697 shares; SCF and SCP
-- 718,995 shares; SCOF and SCOP -- 481,702 shares; Mr. Roseman and
TCM -- 286,099 shares; TC -- 53,147 shares; and TCMF -- 232,952
shares. Except as set forth above, none of the participants has any
direct or indirect interests, by security holdings or otherwise,
required to be disclosed herein, other than the interests of Dr.
Shubin Stein and Messrs. Roseman and Diamond in being nominated and
elected as directors of the Company. DATASOURCE: Celebrate Express
Shareholder Value Committee CONTACT: Richard Grubaugh or Jordan
Kovler of D.F. King & Co., Inc., +1-212-269-5550
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