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by Rule 14a-6(e)(2))
PIER 1
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the
Registrant) United Food & Commercial Workers Union Local 99
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<R/>
Date first mailed:
March 20, 1997<R/>
United Food & Commercial Workers Local 99
2401 N. Central Ave. 2nd Fl.
Phoenix AZ 85004
(602) 572-2149
PLEASE VOTE FOR THE SHAREHOLDER PROPOSAL AGAINST THE POISON PILL
at PIER 1 IMPORTS
Annual Stockholders Meeting
June 26, 1997 10am
Ft. Worth Club (tentative site)
Ft. Worth TX
Dear Fellow Pier 1 Shareholder:
This is to alert you to an upcoming vote on our shareholder
proposal recommending
the board of directors<R/> rescind the
poison pill put into place without a shareholder vote in December
1994.
Under this "poison pill" (the so-called "Share Purchase
Rights Plan"), if someone acquires 15 percent of stock without
the board's blessing (or announces his intent to do so), the
board can dilute the acquiror's interest by allowing other
existing holders to exercise a Right to buy stock worth twice the
market value of the Right's exercise price.
In 1996, shareholder support for proposals opposing pills
increased to 53.4%, the highest support of any issue that proxy
season. Such proposals received 8 majority votes in 1996:
Weyerhauser, Rite Aid, Fleming, SuperValu, Rowan, Baker Hughes,
Ryder and Consolidated Natural Gas. FN1
Mark Boyar is a New York investment manager whose firm held
350,000 shares of Pier 1 last year. He has no connection to our
organization.
In last year's proxy statement, Boyar
criticized management for "pursuing various actions which appear
to contribute to the poor performance of Pier 1 stock, including,
among other things, adopting a 'poison pill . . . ." We too
believe that a poison pill is likely to retard a company's stock
price because it makes the company less attractive to buyers who
would prefer to be able to buy a large stake rather than a few
shares. <R/>
Don't be misled by what management called "independent
studies" in 1988 touting poison pills.
We believe management
is referring to studies by Georgeson & Co., which is a proxy
soliciting firm (which usually works for managements) not a
truly-independent research organization.<R/>
Georgeson first claimed pills result in shareholders
receiving a higher takeover premium. While of course a pill might
force the acquiror to pay more in order to accomplish the
acquisition, that very same fact naturally means fewer acquirors
will bother attempting an acquisition.
Harvard Professor John Pound noted, "The methodology is
severely flawed and fundamentally dishonest. The study explicitly
excludes those targets that used pills to defeat bids. These are
the firm where pills hurt shareholders the most." FN2
Georgeson also claimed companies with pills had better stock
performance than those without in the period 12/85-9/87. However,
many firms in the pill group did not adopt pills until the end of
this time period or afterwards. Thus Pound notes, "So what
[Georgeson was] measuring in many cases is performance that has
nothing to do with the adoption of poison pills, but rather what
occurred before the poison pills were adopted."
FN1: Source: IRRC, based on the 14 companies reporting their vote
as of 9/13/96. The proposals did not pass at Wellman and CNG
because these companies include abstentions in their totals.
FN2 Source: Press release from United Shareholders
Association, 4/5/88, available on PR Newswire. Neither Prof.
Pound nor the other sources quoted herein are participants in
this solicitation. They have not been consulted regarding these
quotations nor consented thereto. <R/>
When Pound analyzed the data with any eye to the date of
pill adoption, Georgeson's results vanished: "those companies
with pills outperformed the control group until they adopted
pills and only matched the performance of the control group after
the fact." FN3
In our view, the market for Pier 1 stock should not be
artificially restricted by management. Shareholders are adults:
thus we believe they should be able to decide for themselves
whether to accept an offer for their stock without interference
from management in the form of a pill.
Wayne Huizenga, co-founder of Blockbuster and Waste
Management (WMX), has the following views on poison pills,
according to Business Week reporter Gail DeGeorge:
He didn't believe in staggered boards, golden parachutes,
poison pills, or any of the other anti-takeover remedies
adopted by U.S. corporations. "The best thing for
shareholders is if someone wants to come in and make a run
at the company, let them make a run. Run the price up,
that's what my job was * * * All these chairmen that want to
put this in place and that in place, they all want to save
their jobs. I don't care about my job."FN4
We will make the following proposal:
RESOLVED, that shareholders recommend the board rescind the
poison pill ("common stock purchase rights") plan which it
adopted in 1994 without a shareholder vote.
Another factor raising a question as to whether the pill is truly
in shareholders' best interests is the makeup of the Pier 1 board
which adopted the pill. For example, Heritage Media CEO James
Hoak has been on Pier 1's board while Pier 1 CEO Johnson has been
on the Heritage board. Other relationships are outlined in the
company's prior proxy statements.FN5
FN3 New York Times 1/4/89 at D5.<R/>
FN4: The Making of a Blockbuster (1996) at 211.
FN5: We incorporate these by reference herein and will make a
copy available upon request of any shareholder to the address or
phone above.
<R/>
VOTING PROCEDURE AND VOTING RIGHTS
We asked management to include this proposal in the proxy
card it will be sending you. We do not know if it will do so. We
intend to circulate our own proxy card once management releases
the information necessary for us to prepare such a card (names of
nominees for election, etc.), at which time we will send you a
revised proxy statement and card.
<R/>
You may revoke a proxy vote any time before the tally by
(1) executing a later proxy card; (2) appearing at the meeting to
vote, or (3) delivering the proxyholder or the Company's
secretary written notice of revocation prior to the date of the
meeting.
The Company's offices are at 301 Commerce St. #600,
Ft. Worth TX 76102, tel. (817) 878-8250; fax 334-0191.
We will keep the content of all cards we receive
confidential from everyone except our staff, except that at the
meeting our cards must be presented to the company's tabulator in
order to be counted.
The proposal is precatory in nature and would not bind the
board. Adoption of the proposal requires an affirmative vote by a
majority of shares present or represented by proxy at the
meeting. Each share of common stock has one vote on each matter
up for a vote. According to the company's 1996 proxy statement,
abstentions have the same effect as voting against a matter, and
votes withheld, including broker non-votes, are not treated as
shares present. <R/>
SOLICITATION
The participants in this solicitation are United
Food & Commercial Workers Local 99 (which owns 148 shares of
company common stock), and its staff (not owners themselves). We
expect to spend about $2000 on the solicitation. We represent
employees in the Arizona retail food industry, and are in
negotiations over a successor contract for one Albertson's store.
We are organizing other Albertson's stores over management
opposition in what we feel are improper forms.FN6.
FN6: Over 1400 Albertsons employees around the country have
reportedly signed declarations claiming they worked "off the
clock" (without compensation). Two class action lawsuits are
pending against Albertson's over this matter. The National Labor
Relations Board reports issuing about 47 complaints against
Albertson's since 1/93. Albertson's campaigns against us in the
workplaces but refuses to allow us access to the employees to
respond, even to breakrooms. With us it refuses to use the
expeditious card-check union recognition procedures it uses in
several other states, instead insisting on formal Labor Board
proceedings. We do not claim these tactics are unlawful, but in
our view they cost more time and money for all concerned,
including shareholders. <R/>
Pier 1 CEO Clark Johnson is an Albertson's director. We do not
ask for your support in the Albertson's dispute, and do not
believe it relevant to how you should vote on a corporate
governance proposal. Even if the labor problems are resolved, we
will present the proposal and your proxy cards at the
shareholders meeting.
We pursued corporate governance
proposals last year at Pier 1 and other companies connected to
Albertson's through their boards, and will do so again this year
(at Boeing, Boise Cascade, Heritage Media, Questar and TIS
Mortgage).<R/>
RECORD DATE/NUMBER OF OUTSTANDING SHARES/SECURITY OWNERSHIP OF
DIRECTORS AND EXECUTIVE OFFICERS/EXECUTIVE COMPENSATION/ELECTION
OF DIRECTORS AND ANY OTHER MATTERS FOR SHAREHOLDER VOTE
Current information on these subjects is not available to
us. We incorporate herein by reference the information contained
on these subjects in management's 1996 proxy statement. Copies
are available upon request by contacting us at the number and
address above. More current information on these matters will be
contained in management's upcoming proxy statement.
SHAREHOLDER PROPOSALS FOR 1998 MEETING
Owners of more than $1000 worth of company stock for more
than a year have the right to have a proposal and supporting
statement appears in management's materials. The deadline for
submission of such a proposal is probably mid-January, 1998 (the
exact date will appear in the company's upcoming proxy
statement).
<R/>
PLEASE VOTE FOR THE PROPOSAL TO RESCIND THE POISON PILL UNLESS
SHAREHOLDERS GET A VOTE
Sincerely,
William McDonough
President UFCW 99