Thesis Capital has sent a letter to Orange 21 management asking the company to explore the sale of the company and then let the shareholders decide if the current public market price would offer better returns.

The letter, in part, reads:

“Thesis Capital has had ongoing discussions with current and former management regarding the future of the Company… Company's owners have yet to receive a strategic plan for the business. In the absence of an articulated plan we are calling on management to initiate a formal process to explore a sale of the Company and let Shareholders decide if the current private market value is acceptable.

“When the Company opened the door to a substantive discussion about a potential transaction with No Fear, the former parent company of Orange 21, we hoped that the Board would fulfill its fiduciary obligation and pursue any and all possible transactions. The stated goal for pursuing the transaction with No Fear was to give the Company better access to capital and a larger platform from which to operate. Assuming these objectives are still true, it has become abundantly clear to us that the best course of action is the pursuit of a sale. We believe that through a sale process, the Company would be valued in excess of $7.00 per share conservatively…

“Discussions with the Company suggest that public company costs alone total in excess of $1 million dollars or 2% of sales. With scale and sufficient infrastructure, the branded eyeglass business should generate gross margins in excess of 50% versus 41% at the Company today (it generated gross margins in excess of 50% as recently as 2002-2004). Clearly this business would generate meaningfully better economics as part of a much larger organization.”