ShopHQ’s dissident shareholders have given the home shopping a little delay in its call for special meeting, until after Christmas. The group, along with a few stinging remarks, said it will agree to have the meeting in January.
The Clinton Group, which owns about 10 percent of ShopHQ, late last week sent a letter to the home shopping network’s chairman in response to his request that the shareholders withdraw their demand for a special meeting.
The Clinton Group is seeking the meeting in a bid to remove a majority of the ShopHQ’s directors, expand the board to nine members and elect seven independent nominees. ShopHQ, whose corporate name is ValueVision Media, asked the group to drop its request because a special meeting could distract management during the company’s important holiday selling season.
In its response, the Clinton Group said that under Minnesota law, the board has discretion to set the special meeting in late January, five weeks after Christmas. If the board set such a date, the Clinton Group has offered to delay its proxy solicitation activities until January to ensure the network could focus on the holiday selling season.
The shareholders also said that the board’s proposal – that the Clinton Group voluntarily withdraw its request for a special meeting and re-file the request in February – would allow the board to set a special meeting date as late as early May. The Clinton Group said it does not believe such a delay is in the interests of shareholders.
The Clinton Group didn’t pull any punches in its letter to ShopHQ.
“With the sympathetic public plea that Christmas is in seven weeks, the Company is surreptitiously seeking up to a six-month delay in holding the Special Meeting,” The Clinton Group said.
“We will not be so easily misled or give up our rights as shareholders in a Minnesota corporation. We do not believe shareholder interests are well served by a delay. If avoiding distractions during the holiday shopping season is your true motivation, we reiterate our suggestion to call a late January meeting.”
Here is the full letter:
Mr. Randy S. Ronning
ValueVision Media Inc.
6740 Shady Oak Road
Eden Prairie, MN 55344
Re: Your Request For Up to a Six-Month Delay in the Special Meeting
Dear Mr. Ronning:
As you know, Clinton Relational Opportunity Master Fund, L.P., together with its affiliates and group members (“Clinton Group”), is the holder of more than 10% of the voting power of all shares of ValueVision Media Inc. (the “Company” or “ValueVision”).
On Monday, November 4, 2013, the Clinton Group submitted a notice calling for a Special Meeting of shareholders (the “Notice”) at which shareholders would be able to consider various proposals, including the removal of a majority of the Company’s directors, the expansion of the Board to nine members and the election of seven independent professionals who possess deep industry experience (the “Nominees”).
As we outlined in our Notice, we believe the Nominees – three of whom have held senior executive positions in the home shopping business, including as CEO of HSN, and two of whom are iconic leaders in the entertainment and media business – can be extremely valuable in helping the Company develop and implement a growth strategy and in identifying a new executive team with a track record of success and the vision, ambition and energy to make ValueVision a premier multi-platform retailer. We are pleased that so many of our fellow shareholders have reached out to us to discuss our proposals since they were announced.
In your letter today, you asked us to withdraw our Notice on the premise that a Special Meeting during the holiday season could distract management. As large shareholders of the Company, we have no interest in diverting the attention of management or keeping the Company from executing well, now or ever.
Accordingly, in a phone call yesterday between our respective representatives, we suggested that the Company exercise its discretion under Minnesota law to hold the Special Meeting of shareholders at the end of January, five weeks after Christmas. Furthermore, we offered that we would not begin to solicit our fellow shareholders until after the holidays (provided that the Company similarly refrains from solicitation), so that the Company could remain focused on executing its business plan.
But instead, ValueVision clarified its real desire is for us to voluntarily and unilaterally withdraw our Notice entirely and re-file it in February. Although your public letter did not say so, under Minnesota law, a February filing would permit the Company to schedule the Special Meeting as late as early May.
With the sympathetic public plea that Christmas is in seven weeks, the Company is surreptitiously seeking up to a six-month delay in holding the Special Meeting. We will not be so easily misled or give up our rights as shareholders in a Minnesota corporation. We do not believe shareholder interests are well served by a delay. If avoiding distractions during the holiday shopping season is your true motivation, we reiterate our suggestion to call a late January meeting.