As you know, we own approximately 8.7% of the outstanding shares of
Despite our nomination, we continued to seek an amicable resolution with the Board in an effort to avoid an expensive and time consuming proxy contest. Unfortunately, we do not believe that the Board’s recent offer adequately addresses the shortcomings of the composition of the Board or protects the best interests of the Company’s stockholders.
The driving factor behind our belief is the makeup of the current seven-member Board. Six of the seven incumbent directors have overseen a 60%+ decline in Fiesta’s share price from its 2015 peak, and under their leadership, the Company’s total shareholder returns have been negative over the past one, two and three-year periods. These same directors authorized the expenditure of more than
Furthermore, the Board consists largely of directors with little to no industry operating experience nor any personal investment in Fiesta stock. In fact,
While we welcome the appointment of
As such, we find the Board’s recent offer contemplating the addition of one of our candidates now and a separate individual to be identified by the Board at a later date to be unacceptable given the lack of assurance that the person selected would be mutually agreeable to both parties. In addition, we are unwilling to commit ourselves to a multi-year standstill period given the current classified Board structure because we believe this would effectively serve to further entrench the incumbent directors who have overseen significant destruction of stockholder value.
We strongly believe that any potential agreement must involve the immediate addition of two highly qualified director candidates, who together will bring significant operating experience and an owner’s perspective into the boardroom. We believe adding such individuals to the Board would remedy the Board’s apparent lack of restaurant expertise and avoid a seemingly unnecessary election contest, which we believe could only benefit the entrenched directors who we do not believe belong on the Board. Therefore, to simplify the choice for stockholders at the upcoming annual meeting, we intend to withdraw our nomination of
While we remain open to a collaborative process regarding Board composition, we are fully prepared to see this through to a vote at the upcoming annual meeting, if necessary, to ensure that stockholders have the opportunity to vote for the most highly qualified candidates to represent their interests.
We look forward to your prompt response.
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
JCP STRONGLY ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE
The participants in the solicitation are
As of the date hereof,
1 Does not include recent purchases made by Leucadia National Corporation, a multi-billion dollar holding company of which director
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