RIDGEFIELD - The Chefs' Warehouse, Inc. (NASDAQ:CHEF), a leading specialty food distributor, announced significant changes to its board of directors and the creation of a task force aimed at improving operational and financial performance. The company has appointed three new independent directors and outlined a plan for incumbent directors to step down in a phased approach by the 2025 annual meeting.
On Monday, the company temporarily expanded its Board of Directors to fourteen members, appointing Richard N. Peretz and Wendy M. Weinstein as new independent directors. Lester Owens was also appointed to the board. These appointments are part of a Cooperation Agreement with Legion Partners Asset Management, LLC, which owns about 3.3% of the company's outstanding common stock.
Peretz, with a history as CFO at United Parcel Service, Inc. (NYSE:UPS) and roles in various companies, brings financial expertise, while Weinstein offers extensive marketing experience within the food and beverage industry. Owens, with a background in financial services operations, rounds out the new additions.
The agreement includes a commitment to form an Operational and Financial Performance Task Force, including Peretz and Weinstein, to identify margin improvement opportunities. The board will work with an independent consulting firm to support these efforts. Additionally, Legion Partners has agreed to support the board's director nominations at the upcoming 2024 Annual Meeting.
This strategic move comes with conditions tied to the company's financial performance. The Cooperation Agreement may extend for another year if the company achieves an Adjusted EBITDA margin percentage of no less than 5.7% for fiscal year 2024 and a forecasted margin of at least 6.2% for fiscal 2025.
The reshuffle reflects the company's focus on bolstering its financial strength and shareholder value. The Chefs' Warehouse serves a diverse clientele, including independent restaurants, fine dining establishments, and specialty food stores, distributing over 70,000 products to more than 44,000 customer locations across the United States, the Middle East, and Canada.
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