Fried-Day (and a brief one, at that!):
Maybe it's no big deal, but just thought I'd ask: Why doesn't the
P.F. Chang's China Bistro
proxy bio for Paul Fleming (its founder, currently a director, largest shareholder and paid consultant of the Asian food chain) say that he is also an owner of two other restaurants, one of which competes almost directly with Chang's? Several of his
southwestern-style restaurants are down the block or in the same complex as Chang's.
Isn't that something of a conflict? After all, both are going after pretty much the same customer, and in the risk-factor sections of its
filings, Chang's cites the possible difficulties of hiring employees and the intense competition in that business -- especially in the "mid-price, full-service casual-dining" segment in which both compete. (Fleming, who has been trimming his Chang's holdings, is the name behind
Fleming's Steak House
So, why weren't his other restaurants mentioned in the Chang's proxy? "We don't feel it's an issue," says Chang's CFO Bert Vivian, who points out that both chains are very small. "Paul is an entrepreneur," he adds. "We have known since day one that he would be involved in other restaurant entities. Everyone at P.F. Chang's, from the board on down, don't feel his other activities are a conflict. Yes, they're competitive, but we don't feel his activities are in conflict with his duties at PF Chang's."
Would've been nice, however, to at least let investors make up their own minds if they felt it was a conflict.
Fleming couldn't be reached.
Reminiscences of stock operators:
Thursday's Hotline noted how
had missed its quarters. Short-sellers (and
this column, for carrying their message) were vilified for suggesting the company's biz was slowing. That's all too familiar to shorts who were short THQ and are currently short
. Says one, comparing THQ, which makes video games, to Salton, which makes the George Foreman Grill: "They both have low P/Es, they both have one product that is being hyped -- THQ's was professional wrestling, Salton's is George Foreman. And they both blame their problems on the shorts. Lo and behold, six months later, THQ's operations turn down and everybody's shocked." Does the same fate await Salton? Who knows, but at least now you know how the shorts think.
And speaking of Salton, a Hotline item
mentioned how analyst Jim Goll of
thought Salton will be generating enough cash flow next year to possibly pay a dividend. I then noted that the high-yield debt covenants restrict the company from paying a dividend. Goll, a former high-yield analyst, forwarded his marked-up copy of the same document suggesting that the company would be able to pay dividends if it met certain tests. All of which, of course, is subject to interpretation.
(If you didn't see Thursday's Hotline, that's a new category in this column for companies whose stories, mentioned here, come back to haunt them.) The latest:
, which late Thursday pre-announced
(This time it was
bad. The trouble, of course, is that at the height of the market's lunacy people really did want to believe that the auto parts after-market was a high-growth biz. Never was, never will be.)
Herb Greenberg writes daily for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, though he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He welcomes your feedback at
email@example.com. Greenberg also writes a monthly column for Fortune.
Mark Martinez assisted with the reporting of this column.