Celebration Express Inc. (BDAY) is the target of a so-called Shareholder Value Committee consisting of several independent funds, namely Spencer Capital and Thesis Capital. The Committee collectively controls approximately 19% of the company. The group unsuccessfully petitioning the board for two seats (while controlling nearly 20% of the company) in June. They were stopped dead in their tracks when the board reacted by instituting a "shareholder rights plan" that severely limited voting power, in an apparent attempt to thwart the group. In an open letter to shareholders dated August 7th, the group commented on the situation:

"We are now convinced, however, that we must have even greater Board representation than we previously requested in order to influence the Company's strategic direction in a meaningful way. Recent Board actions alarm us as shareholders: only last month, in an apparent response to our efforts, the Board unilaterally implemented a poison pill and adopted several bylaw amendments aimed at limiting shareholder rights. Significantly, the Board changed the Company's bylaws so that a majority of the Company's shareholders can no longer amend them. Rather, a supermajority of 66. % of the outstanding stock is now required."

Undeterred, the group is now threatening a proxy battle, saying in their 13D filing:

"In connection with the upcoming Annual Meeting, the Filers and the Shareholder Value Committee intend to file a proxy statement with the Securities and Exchange Commission (the "SEC") to solicit stockholders of the Company with respect to the election of directors ... [the group] determined to nominate Dr. Shubin Stein, Mr. Roseman and Matthew C. Diamond for election at the Company's 2006 annual meeting of stockholders (the "Annual Meeting"), which the Filers expect will be held in October 2006."

The group stated in an earlier filing that "they believe that the market price of the Common Stock does not adequately reflect its intrinsic value." This vague 13D filing was later clarified in the letter to shareholders:

"If elected, our nominees will push to establish a Board committee to consider and pursue strategic alternatives for the Company, including a possible sale of the Company. We believe this is a necessary step toward maximizing value for all shareholders, and a process that should be undertaken immediately."

A possible sale of the company would mean quick price appreciation. Most of the groups shares were acquired at or above the current market price - so they would likely be seeking a great premium in the event of a sale. The group plans to file its proxy statements and individually contact shareholders in the coming month before the vote. This company is definitely worth keeping an eye on - if the Shareholder Value Committee succeeds, it could mean quick profits!