"I respect the point of view that a strong and independent boardis a vital asset," responded Sharper Image CEO Richard Thalheimerlate Monday, "and I am always interested to hear new and positivecontributions to the company's strategy. Accordingly, we are givingvery serious attention to the Knightspoint proposal and theirpoints of view."

In addition to retaining JPMorgan to advise the company on theproposal, the company has outlined several strategic movesincluding Thalheimer's voluntary 50% pay cut, and voluntaryreductions in pay for many members of the company's management teamand the entire board of directors.

The company has also slowed planned new store openings to six toeight in 2006, compared to 19 in 2005 and 28 in 2004; reducedcorporate office and distribution center headcount by more than20%; reduced advertising expenditures by 30% for the fourth quarterof 2005 and budgeted a further 30% reduction in advertising for thefiscal year 2006; and reduced capital expenditures fromapproximately $39 million in 2005 to a planned $12 million to $15million in 2006.