SECAUCUS, N.J., July 23, 2009 (GLOBE NEWSWIRE) -- The Children's Place Retail Stores, Inc. (Nasdaq:PLCE) today sent a letter to stockholders citing the unanimous recommendations of all four independent proxy advisory firms to vote FOR the Company's three highly qualified and independent incumbent directors -- Sally Frame Kasaks, Malcolm Elvey, and Norman Matthews -- up for election at the 2009 Annual Meeting of Stockholders on July 31, 2009.
The letter also highlights the Company's strong performance following Mr. Dabah's resignation -- since September 26, 2007, the day Mr. Dabah resigned, The Children's Place stock price has risen 22%, while the S&P Retail Index has fallen 29% during that period. The Children's Place urges its stockholders to vote the WHITE proxy card FOR its nominees, who have extensive industry experience and outstanding corporate governance credentials.
The full text of the letter follows:
July 23, 2009
COMPANY NOMINEES RECEIVE UNANIMOUS ENDORSEMENT FROM ALL FOUR
INDEPENDENT PROXY ADVISORY FIRMS
To Our Stockholders:
The Company's Annual Meeting is rapidly approaching and it is crucial
that all stockholders of The Children's Place cast their votes on the
WHITE proxy card accompanying this letter as soon as possible.
Recently, the Company's highly qualified and independent nominees have
received the endorsement of all four independent proxy advisory firms
whose clients include hundreds of institutional investors, mutual
funds, money managers and other fiduciaries. These firms are unanimous
in recommending that The Children's Place stockholders vote FOR the
Company's three nominees, Sally Frame Kasaks, Malcolm Elvey and Norman
Matthews -- and that stockholders DO NOT VOTE FOR Mr. Dabah's
hand-picked nominees or his bylaw proposal.
As you know, under the current Board and management team, The
Children's Place has been revitalized and is now positioned as a
leading value-oriented retailer of children's apparel and accessories.
We urge stockholders to vote to protect the value of their investment
by supporting the Company's highly qualified and independent incumbent
nominees. Since Ezra Dabah was forced to resign as CEO in September
2007, The Children's Place has generated strong results and the
Company's stock price has significantly outperformed its peers* under
the leadership of your current Board and management. The Company is
proud of its track record of creating value and asks for your support
to continue to build on the Company's recent successes. In fact, The
Children's Place stock price is up 22% since new leadership was
installed following Mr. Dabah's resignation, while the S&P Retail
Index is down 29% during that period.
OBJECTIVE THIRD PARTIES UNANIMOUSLY RECOMMEND STOCKHOLDERS VOTE
FOR ALL THREE COMPANY NOMINEES ON THE WHITE CARD!
We are pleased that RiskMetrics Group (formerly ISS), Glass Lewis &
Co., PROXY Governance, Inc. and Egan-Jones Proxy Services, the four
trusted independent voices for investors, have recommended that The
Children's Place stockholders cast their votes FOR all three of the
Company's nominees, Sally Frame Kasaks, Malcolm Elvey, and Norman
Matthews, at the upcoming Annual Meeting. These four firms have also
recommended that stockholders DO NOT VOTE FOR Ezra Dabah's three
hand-picked nominees or his bylaw proposal. These third-party
endorsements further underscore our strong belief that the Company's
highly qualified independent directors are best suited to lead The
Children's Place forward and that it is NOT in stockholders best
interests to provide Mr. Dabah with any more representation on the
Board.
In its analysis, RiskMetrics noted:
* "RMG ... recommends that shareholders support the incumbent
nominees and vote FOR Ms. Kasaks, and Messrs. Elvey and
Matthews."
* "Comparatively, PLCE's share price has outperformed its peer
group since Mr. Crovitz's appointment as the CEO in Sept
2007."
* "...our findings show that the company's financial
performance since Mr. Crovitz has been CEO overall
demonstrates positive performance relative to the company's
peers."
* "...we ascribe 2008 performance to Crovitz as he was
directly involved with the daily running of the business
from that fiscal year onward."
* "...shareholders seem to have benefited from the oversight
provided by the interim management as indicated by PLCE's
share price performance since Mr. Crovitz's appointment in
Sept 2007."
* "...Wall Street also seems to be generally supportive of the
interim management and incumbent board's performance."
In its analysis, Glass Lewis noted:
* "...we recommend that shareholders vote FOR all management
nominees on the WHITE card."
* "...the board and management team have performed well since
late 2007. The executive management has implemented a number
of strategic and operational changes which have yielded
positive results. We note that the Company's stock price has
outperformed its peers over the period beginning on
September 25, 2007, the date after the resignation of Mr.
Dabah as CEO, and ending on May 5, 2009, the date that the
Dissident notified the Company that it would initiate its
proxy contest. We observed that the Company's stock
increased 37% during this period while a broad index of 15
retail peers declined 43.3% and an index of large retail
competitors increased just 3.4%."
* "...we find no reason to believe that the current board and
management team are not acting in the best interests of
shareholders. The board and management proactively addressed
a number of substantial internal problems and implemented
new growth strategies."
* "...the Dissident currently holds two seats on the board
which provides adequate access to the remainder of the board
to solicit support for the Committee's growth strategies and
is roughly equivalent to its economic stake in the Company."
In its analysis, PROXY Governance noted:
* "We believe that the current board - in restoring the
company's operating and fiscal health over the nearly two
years since dissident Dabah stepped down as CEO, and in its
strategic vision for the company's future success - has
demonstrated compelling stewardship and a significant
commitment to the best interests of all shareholders, and
should be granted additional latitude - including
shareholder support for the three incumbent directors
standing for re-election at this meeting - to pursue its
strategic plan."
* "Simply as a specialty retailer in a deep recession - let
alone as a company which exited the 2007 holiday season with
huge levels of unsold inventory, heavy balances remaining on
its credit lines going into a quarter when retailers
generate little cash, and a former CEO intent on regaining
control by forcing a sale, prosecuting a proxy contest, and
suing the board to obtain an earlier annual meeting date -
this board's performance has been spectacular."
* "The company's performance since Dabah stepped down as CEO,
as many equity analysts have noted, is much more complex
than 'just' cutting costs - and much more likely to achieve
future success than the trajectory established in Dabah's
final years as CEO."
* "The growing liquidity risk at the end of Dabah's tenure -
driven not just by huge capital drains and underwhelming
operating performance of his big box strategy, but by an
operating response to grow inventory 24% year-over-year
despite weakening demand signals in a peak selling season -
speaks volumes about the difference between having a vision
for the future and operating a public company in the best
interests of all shareholders."
In its analysis, Egan-Jones noted:
* "We believe that the management ballot deserves our
support."
* "...we believe election of the slate of director nominees
presented by the management is in the best interest of the
Company and its shareholders."
* "We are of the view that election of the Committee's [Mr.
Dabah's] nominees would not contribute meaningfully to the
quality of the Company's board of directors."
* "...the Committee [Mr. Dabah] has failed to persuade us that
support of its ballot would operate to the benefit of all
shareholders during a challenging retail environment."
We urge stockholders to follow the UNANIMOUS recommendation of the
four independent proxy voting advisory firms and vote to protect the
value of their investment by supporting the Company's independent
nominees.
THE CHILDREN'S PLACE HAS THE RIGHT BOARD IN PLACE
TO CONTINUE TO CREATE VALUE FOR STOCKHOLDERS
Your Board and management team have taken decisive steps to turn
around and revitalize The Children's Place since Mr. Dabah was forced
to resign as CEO in September 2007 after Deloitte & Touche, then the
Company's auditors, told the Board it was no longer willing to rely on
his representations in connection with its audits.
The Company's nominees, Sally Frame Kasaks, Malcolm Elvey, and Norman
Matthews, who currently sit on the Company's Board, have extensive
industry experience and outstanding corporate governance credentials.
Ms. Kasaks and Mr. Elvey have been influential in overseeing the
dramatic improvement in the Company's financial and operational
performance following Mr. Dabah's resignation and in the short period
that Mr. Matthews has been a director, his unparalleled knowledge of
retail and specialty apparel has been a tremendous asset.
Sally Frame Kasaks Ms. Kasaks has served as a director of our company
since 2000, as lead director since August 2005 and
as acting Chair since January 2007. Ms. Kasaks is
currently a director and employee of Pacific
Sunwear of California, Inc. Until June 2009, Ms.
Kasaks served as Chair and Chief Executive Officer
of Pacific Sunwear, a position she assumed in May
2007 after having served as interim Chief
Executive Officer of the company since October
2006. Ms. Kasaks voluntarily resigned as Chair and
Chief Executive Officer in June 2009 upon
completion of a successful search for her
successor and in connection with Pacific Sunwear's
decision to appoint an independent director as
Chairman of its Board of Directors. From 1997 to
May 2007, Ms. Kasaks served as a retail and
marketing business consultant to a number of
retailers through ISTA Incorporated. From 1983 to
1985 and again from 1992 to 1996, Ms. Kasaks
served as the Chief Executive Officer of Ann
Taylor Stores, Inc. Ms. Kasaks has also served as
Chief Executive Officer of both Abercrombie &
Fitch and Talbots, Inc. During her career, Ms.
Kasaks has served as a director to numerous
companies, including Coach, Inc., Tuesday Morning,
Inc., The White House, Inc., Cortefiel S.A and
Crane & Co., Inc. In addition, Ms. Kasaks has
served as Advisor to the board of the Army Air
Force Exchange Service (AAFES).
Malcolm Elvey Mr. Elvey is currently Managing Partner of
Collaborative Capital, a venture capital fund
focused on early-stage technology companies. From
2004 to 2006, Mr. Elvey served as the Chief
Executive Officer of LimoRes.net, a ground
transportation company he helped found in New
York. Mr. Elvey has also founded other companies,
most notably, Esquire Communications, Ltd., a
court reporting and legal services company, and
Metro Cash & Carry, a publicly-traded South
African warehouse club. Prior to founding Esquire
Communications, Mr. Elvey served for two years as
a board member and as head of several divisions of
ADT Ltd., a nationally recognized electronic
security services provider. During his career, Mr.
Elvey has served on the boards of public companies
in the United States, Italy, the United Kingdom
and South Africa, most notably, Pritchard Services
and The Hawley Group, both United Kingdom-based
companies. Mr. Elvey also coaches and runs
workshops for public, private and not-for-profit
organizations. He has been a member of the Young
President's Organization/World President's
Organization (YPO/WPO) since 1973 and has been an
adjudicator of business plans at the Columbia
Business School since 1999. Mr. Elvey has an MBA
from the University of Cape Town, South Africa and
is a chartered accountant. He has served as a
director of The Children's Place since December
2002.
Norman Matthews Mr. Matthews currently serves on the boards of The
Progressive Corporation, Henry Schein, Inc., and
Finlay Enterprises, Inc. Previously, he served on
the boards of Sunoco, Inc., Toys "R" Us, Inc., and
Federated Department Stores. Mr. Matthews served
as President of Federated Department Stores until
his retirement in 1988. He joined Federated
Department Stores in 1978 as Chairman - Gold
Circle Stores Division. He was promoted to
Executive Vice President of Federated Department
Stores in 1982, to Vice Chairman in 1984 and to
President in 1987. Prior to joining Federated
Department Stores, Mr. Matthews served as Senior
Vice President, General Merchandise Manager for
E.J. Korvette, and as Senior Vice President,
Marketing and Corporate Development for Broyhill
Furniture Industries. In 2005, Mr. Matthews was
named as one of eight outstanding directors by the
Outstanding Directors Exchange. Mr. Matthews has
served as a director of the Children's Place since
March 2009.
SUPPORT THE COMPANY'S HIGHLY QUALIFIED,
INDEPENDENT INCUMBENT DIRECTORS
- VOTE THE WHITE PROXY CARD TODAY -
Do NOT return any gold proxy card you may receive from Mr. Dabah. Do
NOT authorize a proxy to vote your shares for Mr. Dabah's nominees. If
you have already returned a gold proxy card to Mr. Dabah or otherwise
authorized a proxy to vote your shares for his nominees, it is not too
late to change your vote. To revoke your prior proxy and change your
vote, simply sign, date, and return the enclosed WHITE proxy card
today in the postage-paid envelope provided. Only your latest dated
proxy will be counted.
MacKenzie Partners Inc. is assisting The Children's Place with its
efforts to solicit proxies. If you have any questions about voting
your shares, please call MacKenzie Partners Inc. toll-free at (800)
322-2885 (or call collect at (212) 929-5500) or email:
childrensplace@mackenziepartners.com.
Every stockholder's vote is important, regardless of how many shares
you own. To ensure your vote is counted, vote by telephone or Internet
now or mail in your vote today on the WHITE proxy card.
Thank you for your continued support.
Very truly yours,
Charles Crovitz
Interim Chief Executive Officer
and Member of the Board of Directors
* The Children's Place peers include: ARO - Aeropostale, DBRN - Dress
Barn, CHS - Chico's, GYMB - Gymboree, DEST - Destination Maternity, RL
- Ralph Lauren, MW - Men's Warehouse, TLB - Talbots, PVH - Philip Van
Heusen, AEO - American Eagle, CHRS - Charming Shoppes, BONT - Bon-Ton,
ANF - Abercrombie & Fitch, ANN - Ann Taylor and PSUN - Pacific
Sunwear.
The Children's Place Board of Directors urges stockholders to vote the WHITE card promptly. If stockholders have any questions or need assistance in voting, please call MacKenzie Partners, Inc. who is acting as The Children's Place proxy solicitor and can be reached toll-free at (800) 322-2885 or collect at (212) 929-5500. They can also be reached by e-mail at childrensplace@mackenziepartners.com.
About The Children's Place Retail Stores, Inc.
The Children's Place Retail Stores, Inc. is a leading specialty retailer of children's merchandise. The Company designs, contracts to manufacture and sells high-quality, value-priced merchandise under the proprietary "The Children's Place" brand name. As of July 4, 2009, the Company owned and operated 936 The Children's Place stores and an online store at www.childrensplace.com.
Forward-Looking Statements
This press release may contain certain forward-looking statements regarding future circumstances. These forward-looking statements are based upon the Company's current expectations and assumptions and are subject to various risks and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties are described in the Company's filings with the Securities and Exchange Commission, including in the "Risk Factors" section of its annual report on Form 10-K for the fiscal year ended January 31, 2009. Included among the risks and uncertainties that could cause actual results, events and performance to differ materially are the risk that the Company will be unsuccessful in gauging fashion trends and changing consumer preferences, and the risks resulting from the highly competitive nature of the Company's business and its dependence on consumer spending patterns, which may be affected by the downturn in the economy. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. The Company undertakes no obligation to release publicly any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. The inclusion of any statement in this release does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.
Important Information
The Company filed a definitive proxy statement and other relevant documents concerning the 2009 Annual Meeting of Stockholders with the United States Securities and Exchange Commission ("SEC") on June 16, 2009, further supplemented on July 14, 2009. The Company has provided stockholders with the definitive proxy statement. The Company advises stockholders to read the definitive proxy statement because it contains important information about the election of directors and any other matters to be presented at the 2009 Annual Meeting of Stockholders. Stockholders may obtain free copies of the definitive proxy statement and other documents the Company files with the SEC at the SEC's website at www.sec.gov. They may also access a copy of the company's definitive proxy statement by accessing www.viewourmaterial.com/plce. In addition, stockholders may obtain a free copy of the definitive proxy statement and other related documents by contacting MacKenzie Partners toll-free at (800) 322-2885 or call collect at (212) 929-5500.
The Company, its directors, some of its executive officers and certain other of its employees are participants in the solicitation of proxies in respect of the matters to be considered at the 2009 Annual Meeting of Stockholders. Information about the participants is set forth in the definitive proxy statement. Information about the participants' direct or indirect interests in the matters to be considered at the Annual Meeting is also contained in the proxy statement referred to above.