francesca’s® Adopts Stockholder Rights Plan
August 02 2019 - 8:30AM
Francesca’s Holdings Corporation (the “Company”) (Nasdaq: FRAN)
today announced that its Board of Directors unanimously adopted a
Rights Agreement (the “Rights Plan”) and declared a dividend of one
preferred share purchase right (a “Right”) on each outstanding
share of the Company’s common stock, par value $0.01 per share (the
“Common Stock”) following the Board’s evaluation and consultation
with the Company’s advisors.
The Board adopted the Rights Plan to deter any
entity, person or group from gaining control of the Company through
the open market or private transactions without paying an
appropriate control premium or offering fair and adequate value to
all stockholders. It is intended to enable the stockholders of the
Company to realize the value of their investment in the Company,
ensure that all stockholders receive fair treatment, and provide
the Board and stockholders with adequate time to make informed
decisions. The Rights Plan is not intended to deter offers that are
fair and otherwise in the best interests of the Company’s
stockholders.
In the event the Rights become exercisable, each
Right will initially entitle stockholders to buy one
five-thousandth of a share of Series A Junior Participating
Preferred Stock, par value $0.01 per share, of the Company (the
“Preferred Stock”) at an exercise price of $18.00 per one
five‑thousandth of a share of Preferred Stock, subject to
adjustment and the terms of the Rights Plan. In general, the Rights
will become exercisable ten business days after a person or group
becomes the beneficial owner of 15% or more of the outstanding
Common Stock or announces a tender offer for 15% or more of the
outstanding Common Stock (or, with respect to any person or group
that beneficially owns 15% or more of the outstanding Common Stock
prior to the issuance of this press release, ten business days
after such person or group becomes the beneficial owner of any
additional Common Stock, subject to certain exceptions). The Board
of Directors will in general be entitled to redeem the Rights, in
whole but not in part, at $0.001 per Right at any time before the
triggering ownership threshold is crossed.
In the event that the Rights become exercisable
due to the triggering ownership threshold being crossed, each Right
will entitle its holder to purchase, at the Right’s exercise price,
a number of shares of Common Stock (or cash, other assets, debt
securities of the Company, or any combination thereof equivalent in
value thereto), in lieu of shares of Preferred Stock, with an
aggregate value equal to twice the Right’s exercise price. Rights
held by the triggering person will become void and will not be
exercisable to purchase shares at the reduced purchase price. After
the Rights have become exercisable, the Board of Directors may also
choose to exchange the Rights (other than Rights owned by the
triggering person which will have become void), in whole or in
part, for shares of Common Stock or Preferred Stock at an exchange
ratio of one share of Common Stock or a fractional share of
Preferred Stock (or cash, other assets, debt securities of the
Company, or any combination thereof equivalent in value thereto)
per Right. Further details about the Rights Plan will be contained
in a Form 8-K to be filed by the Company with the U.S. Securities
and Exchange Commission.
The dividend distribution will be payable on
August 29, 2019, to stockholders of record as of the close of
business on August 15, 2019. The Rights will expire at the close of
business on August 1, 2022, unless the Rights are earlier redeemed
or exchanged by the Company. The Rights distribution is not taxable
to stockholders.
Forward-Looking Statements
Certain statements in this release are “forward-looking
statements” made pursuant to the safe-harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. Such
forward-looking statements reflect the Company’s current
expectations or beliefs concerning future events and are subject to
various risks and uncertainties that may cause actual results to
differ materially from those that are expected. These risks and
uncertainties include, but are not limited to, the following: the
Company’s ability to realize any anticipated benefits from the
adoption of the Rights Plan; the Company’s ability to continue to
satisfy Nasdaq’s qualitative and quantitative continued listing
standards, including the necessary stock price levels; the risk
that the Company’s exploration of strategic or financial
alternatives may not result in any transaction or alternative that
enhances value; the risk that the Company may not be able to
successfully execute its turnaround plan; the risk that the Company
may not be able to successfully integrate its Interim Chief
Executive Officer and Chief Financial Officer, and attract and
integrate a new Chief Executive Officer; the risk that the Company
cannot anticipate, identify and respond quickly to changing fashion
trends and customer preferences or changes in consumer environment,
including changing expectations of service and experience in
boutiques and online, and evolve its business model; the Company’s
ability to attract a sufficient number of customers to its
boutiques or sell sufficient quantities of its merchandise through
its ecommerce website; the Company’s ability to successfully open,
close, refresh, and operate our boutiques each year; the Company’s
ability to efficiently source and distribute merchandise quantities
necessary to support its operations; and the impact of potential
tariff increases or new tariffs. For additional information
regarding these and other risks and uncertainties that could cause
actual results to differ materially from those contained in the
Company’s forward-looking statements, please refer to “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year
ended February 3, 2019 filed with the Securities and
Exchange Commission (“SEC”) on May 3, 2019 and any
risk factors contained in subsequent quarterly and annual reports
it files with the SEC. The Company undertakes no obligation to
publicly update or revise any forward-looking statement.
About Francesca's Holdings Corporation
francesca's® is a specialty retailer which operates a
nationwide-chain of boutiques providing customers a unique, fun and
personalized shopping experience. The merchandise assortment is a
diverse and balanced mix of apparel, jewelry, accessories and
gifts. As of August 1, 2019, francesca's® operated approximately
718 boutiques in 47 states throughout the United States and the
District of Columbia and also serves its customers through
francescas.com. For additional information on francesca's®, please
visit www.francescas.com.
CONTACT:
ICR, Inc.
Jean Fontana
646-277-1214
CompanyKate Venturina 713-864-1358 ext.
1145ir@francescas.com
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