FORT MYERS, Fla., June 24, 2019 /PRNewswire/ -- Chico's FAS,
Inc. (NYSE: CHS) (the "Company") today issued the following open
letter to shareholders announcing additional actions that
demonstrate the Board of Director's ongoing commitment to strong
corporate governance policies and practices, including additional
Board-sponsored actions that ensure all Chico's FAS shareholders
retain voting rights for each share they own:
Dear Fellow Chico's FAS Shareholders:
Some years ago, Florida was one
of a number of states to adopt a provision known as a control share
acquisition statute, and as a company headquartered in Florida, this provision was automatically
incorporated into our bylaws. In particular, Section 607.0902
of the Florida Business Corporation Act denies voting rights to an
investor if it acquires 20% or more of the Company's shares, unless
the voting rights are approved by a majority of unaffiliated
shareholders at a special meeting.
While we currently have no shareholder that owns 20% or more of
the Company's shares, at Chico's FAS, we believe that if you own
any shares in our company, you should have the right to vote those
shares – period. Accordingly, the Chico's FAS Board of
Directors has unanimously approved an amendment to the Company's
bylaws whereby the Company has opted out of the control share
acquisition statute under the Florida Business Corporation
Act.
This important action ensures that all of our shareholders have
the voting rights we believe they deserve. It also eliminates
the need for a Special Meeting, as recently requested by Sycamore
Partners ("Sycamore"). Unlike the Special Meeting proposed by
Sycamore, which would have applied only to Sycamore's
shareholdings, this action by the Chico's FAS Board ensures that
ALL shareholders will be entitled to freely vote their shares in
the Company. As noted above, we strongly believe that all
Chico's FAS shareholders, not just Sycamore, should have the right
to vote the shares they own.
To be clear, this bylaw amendment relates solely to
voting rights; it does not speak to the merits of, or otherwise
advance, Sycamore's unsolicited acquisition proposal, nor does it
speak to whether the Company should engage with Sycamore on its
proposal. As previously announced, Sycamore's June 19, 2019 proposal is being reviewed by the
Board.
On this point, we appreciate the strong support we have received
from numerous shareholders for the Board's decision to reject
Sycamore's May 10 acquisition
proposal and the confidence expressed in our ability to improve the
Company's growth and value creation. We also appreciate the
strong support we have received from numerous shareholders over the
past weeks for our new operating priorities and the improvements
underway in these areas.
Ensuring high standards of corporate governance has long been a
priority for the Chico's FAS Board, and the amendment announced
today builds on previous enhancements we have made to ensure
Chico's FAS operates within a strong set of governance principles
and practices. For example:
- We chose to begin benchmarking our governance policies against
the framework established by the Investor Stewardship Group ("ISG")
shortly after the framework went into effect last year. The
ISG is a collective of some of the largest institutional investors
and global asset managers, including some of our own investors,
that seeks to promote best practices in corporate governance.
- At the Board's initiative, we recently completed the
declassification process, and all Chico's FAS directors will be
annually elected beginning with our 2019 Annual Shareholder
Meeting.
- We have worked to ensure diversity at all levels of the
organization. Indeed, we believe diversity is not just good
governance, it is also good business and we are proud to have
received numerous awards and recognitions for our diversity
efforts. Today, women comprise 63% of the Chico's FAS
executive committee. In addition, four directors on our
eight-member Board are women, including our newest director,
Kim Roy, who joined in February of
this year.
- We have an active director review and Board refreshment
process. With Kim Roy's appointment, we have added four new
directors to the Board (50% of the Board) in the past three
years. This refreshment process considers changes in our
strategy and the overall industry landscape, and helps ensure that
the Board continues to benefit from an appropriate mix of skills,
experience and tenure to oversee the Company, our strategic
execution and our performance against this backdrop.
Additional details about our corporate governance are available
in the proxy materials on our website and sent to all
shareholders eligible to vote at the upcoming Annual
Meeting.
As we focus on the improvements underway at Chico's FAS,
including the progress we are making in our search for a new CEO
and in executing initiatives under our new operating priorities, we
appreciate the continued support of our shareholders and look
forward to continuing to engage with you. The Chico's FAS Board has
taken – and will continue to take – all appropriate steps to
maximize sustainable, long-term growth and value creation in the
best interests of all Chico's FAS shareholders.
On behalf of the Chico's FAS Board, sincerely,
David F. Walker
Chair of the Board
Goldman Sachs & Co. LLC is serving as financial advisor to
Chico's FAS, and Paul, Weiss, Rifkind, Wharton & Garrison LLP
is serving as legal counsel.
ABOUT CHICO'S FAS, INC.
The Company, through its brands – Chico's, White House Black
Market, Soma and TellTale™ is a leading omnichannel specialty
retailer of women's private branded, sophisticated,
casual-to-dressy clothing, intimates and complementary
accessories.
As of May 4, 2019, the Company
operated 1,410 stores in the U.S. and Canada and sold merchandise through 84
international franchise locations in Mexico and one domestic franchise airport
store. The Company's merchandise is also available at
www.chicos.com, www.chicosofftherack.com, www.whbm.com,
www.soma.com and www.mytelltale.com as well as through third party
channels.
For more detailed information on the Company, please go to our
corporate website at www.chicosfas.com. The information on our
corporate website is not, and shall not be deemed to be, a part of
this press release or incorporated into our federal securities law
filings.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
This release contains statements that constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. The statements relate to, among other things,
expectations, estimates and projections regarding the brand's new
product initiatives and are identified by use of the words
"anticipate," "believe," "could," "estimate," "expect," "intend,"
"may," "plan," "outlook," "predict," "project," \"should,"
"strategy," "target," "will," "would," "potential" and similar
terms. Factors that could cause actual results to differ include,
but are not limited to: the extent of the market demand and overall
level of spending for women's private branded clothing and related
accessories; the effectiveness of our brand awareness and marketing
programs; the ability to successfully execute our business
strategies and to achieve the expected results from them; the
successful recruitment of leadership and the successful integration
of new members of our senior management team; and the risk that our
investments in merchandise or marketing initiatives may not deliver
the results we anticipate. Other risk factors for the Chico's FAS,
Inc.'s business are detailed from time to time in the Chico's FAS,
Inc.'s Quarterly Reports on Form 10-Q, Annual Report on Form 10-K
and other reports filed with the Securities and Exchange
Commission. These factors should be considered in evaluating
forward looking statements contained herein.
Contacts:
Investors
Julie
Lorigan
Vice President – Investor
Relations,
Public Relations and Corporate Communications
Chico's FAS, Inc.
(239) 346-4199
Arthur B. Crozier / Jennifer Shotwell / Jon
Salzberger
Innisfree M&A Incorporated
(212) 750 5833
Media
Barrett Golden /
Leigh Parrish
Joele Frank, Wilkinson Brimmer
Katcher
(212) 355 4449
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SOURCE Chico's FAS, Inc.