Furniture Brands Issues Open Letter to Stockholders
Our Board of Directors recently extended the company’s stockholder rights agreement for three years, and I’d like to take this opportunity to discuss how this action benefits all stockholders.
From its inception in 1998, the stockholder rights agreement has been designed to ensure that any party seeking to acquire Furniture Brands offers a price that provides maximum value to all stockholders. The plan effectively prevents a single stockholder from capturing the future value of Furniture Brands at the expense of all other stockholders.
The rights plan is not intended to prevent a takeover or any other acquisition proposal that is fair and equitable for all stockholders. The primary aim of the rights plan is to encourage anyone seeking to acquire the company to negotiate with the Board prior to attempting a takeover so that all Furniture Brands stockholders might realize the long-term value of their investment in the company.
The Board amended the agreement primarily to extend the final expiration date of the rights for three years to July 30, 2011 as the current plan reaches the end of its 10-year term on July 30, 2008. The new amendment also adjusted the purchase price and redemption price for the rights. A summary of the stockholder rights agreement accompanies this letter.
More than 1,300 U.S. public companies maintain stockholder rights agreements, and our Board agrees that the Furniture Brands rights plan provides adequate protection to all of our stockholders as well.
In conclusion, the Board believes that by extending the rights plan it is extending the opportunity for all stockholders to achieve the full value for their investment in Furniture Brands. The company is aggressively executing a solid strategic plan and has the financial resources to achieve its completion. The Board and management appreciate the trust placed in them and are constantly seeking to deliver maximum long-term stockholder value.
Tags: board of directors, furniture, furniture brands, rim, rust, stock, urnRelated posts
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