Foothills Ranch, Calif. -- The chairman of The Wet Seal and three other directors have stepped down from its board, replaced by four nominees of the Clinton Group. The move follows several attempts by the activist investor group, which holds about 7% of Wet Seal, to take control of the struggling retailer.
As a result of the board changes, Clinton Group has agreed to terminate its effort to get support from shareholders for its nominees, Wet Seal said Friday.
The Wet Sea said board members Jonathan Duskin, Sidney Horn and Henry Winterstern have resigned, along with chairman Hal Kahn. They have been replaced with four Clinton Group nominees: Dorrit Bern, Lynda Davey, Mindy Meads and John Mills.
The board will also still include Kathy Bronstein, John Goodman and Ken Reiss.
“We believe that the agreement with Clinton Group is in the best interest of all Wet Seal shareholders,” said Ken Seipel, president and COO of Wet Seal. “This settlement will provide for a smooth and orderly transition of the Board’s responsibilities, as well as a level of continuity for our employees.”
The retailer said that former board chairman Kahn has agreed to continue to serve the company as a consultant pursuant to his existing contract.