Cenveo CEO Jim Malone Sends Letter To Stockholders
Press release from the issuing company
ENGLEWOOD, Colo., Aug. 11 -- Cenveo, Inc. today sent a letter from James R. Malone, President and Chief Executive Officer, to stockholders urging their support at the upcoming Special Meeting of Stockholders, scheduled for September 14, 2005. A copy of the letter follows:
Dear Fellow Stockholder:
As the recently appointed President and Chief Executive Officer of Cenveo, I am writing to ask for your support at the upcoming Special Meeting of Stockholders, scheduled for September 14, 2005.
At this critical time in Cenveo's history, a dissident group led by Robert Burton has called a Special Meeting seeking to replace your Board with his hand-picked nominees, and to install three of Mr. Burton's children in senior management positions. Mr. Burton is attempting to take control of your Company without giving you, the stockholders of Cenveo, any immediate value in return. I urge you to reject Mr. Burton's proposals and to act now to protect the value of your investment by signing, dating and returning the enclosed GOLD proxy card today.
We are moving in the right direction and are aggressively implementing cost-cutting and other value-enhancing initiatives. Don't stop the progress we are making for you.
CENVEO IS MOVING IN THE RIGHT DIRECTION
Since being named as Chief Executive in June, I have worked closely with your Board and management to see that changes necessary to restore Cenveo to profitability are successfully implemented. I have a strong track record of delivering results and shareholder value and was hired to lead change at Cenveo. At the same time, an aggressive and thorough review and evaluation of all strategic alternatives available to the Company-including the possibility of a sale or merger-is ongoing.
I have spent many hours meeting with Cenveo's stockholders, employees and customers around the country. I am pleased to tell you that I have found enthusiasm about Cenveo's future everywhere I travel. Without question, Cenveo is a dynamic company with substantial prospects to enhance value for all stockholders.
MY FOCUS IS ON STOCKHOLDER VALUE
With the full support of your Board, my first action upon taking office was to immediately implement a critical analysis of Cenveo's operations. You should know that we have already identified $55 million in annualized cost savings that will be in place by January 1, 2006. We are moving quickly to streamline management functions and reduce operating expenses, while working to increase top-line revenue growth. At the same time, we have begun an operational transformation that will improve the Company's ability to serve its clients, strengthen its position in the industry, and in the end, maximize its value to you, its owners.
These initiatives include:
* Streamlining management-Our management realignment has put senior management in closer touch with both operations and our customers. Reporting lines have been shortened, and operating unit presidents now report directly to me.
* Consolidating facilities and office space-Headquarters staff has been downsized and overhead substantially reduced, with a move to smaller, less expensive office space planned by year-end.
* Discontinuing unnecessary programs and activities-I have recently discontinued all programs and activities that do not support Cenveo's high level of corporate governance or do not serve our customers. This cost reduction is in the best interest of our stockholders and is being aggressively implemented.
As a result of these initiatives, Cenveo expects to enter 2006 with an annual EBITDA run rate of $190 million, a substantial upward adjustment.
MR. BURTON'S "PLAN"Mr. Burton has said that he has a "detailed plan" for Cenveo, yet continues to keep that "plan" secret from investors. Furthermore, Mr. Burton and his group have not expressed any support for Cenveo's value-maximizing initiatives. From my perspective, it appears that Mr. Burton has no real plan at all.
I urge you to consider your own best interests. Remember, Burton is not offering to pay a control premium. He is not offering to buy your shares. Instead, he is seeking to gain control by installing himself as chief executive officer, installing his associates as directors and his children into important management positions. Election of his slate will trigger change of control provisions in certain of our debt agreements at a substantial cost to the Company. I believe it is essential that you reject Mr. Burton's effort to take over Cenveo without paying anything to its stockholders. Instead, I urge you to support our efforts to maximize value for all stockholders.
PROTECT THE VALUE OF YOUR INVESTMENT--VOTE THE GOLD PROXY TODAY!
The future of Cenveo is in your hands, and your vote is extremely important. I urge you to vote AGAINST Proposals 1 through 5, and FOR Cenveo's director nominees in Proposal 6, by signing, dating and returning the enclosed GOLD proxy card today.
I urge you to disregard Mr. Burton's white proxy card. If you have previously returned a white proxy card, you have every legal right to change your vote by signing, dating, and returning the enclosed GOLD proxy card today. Only your latest-dated proxy counts.
On behalf of all members of the Cenveo team, thank you for your support. We look forward to continuing to communicate with you in the coming weeks. Please be assured that with the support of your Board and management team, I am fully committed to taking all steps necessary to protect and enhance the value of your investment in Cenveo.
James R. Malone
President and Chief Executive Officer
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