Wet Seal CEO John D. Goodman has resigned from the role he took in January 2013. He was charged with turning things around for the struggling retailer and replaced Susan McGalla, who was herself ousted after 11 months amid declining sales.
Goodman is to be succeeded by Edmond Thomas, who rejoins the company as CEO and a member of the board as of Sept. 8. Thomas served as executive chief and director from 2007 to 2011 and as president, chief operating officer and director from 1992 to 2000.
According to the board of directors, it mutually agreed with Goodman that it was time for him to step down, effective immediately.
“Ed has served in various leadership roles at the company for nearly two decades, as recently as 2011. In addition to his background at Wet Seal, Ed has extensive experience working with other retail and consumer brands, including their omnichannel initiatives, making him uniquely qualified to lead Wet Seal and generate value for shareholders,” said Adam Rothstein, incoming chairman of the Wet Seal board. “The board is pleased that Ed will lead the company once again and we look forward to his impact at Wet Seal.”
Rothstein, who has served as a member of the board since March 2014, replaces current chairperson Lynda Davey, who has resigned from the board, effective Oct. 1.
Thomas most recently served as a partner of KarpReilly, a private investment firm focused on small to midsize growth companies, and is currently a member of the board of directors of New York & Company. In addition to his prior roles at Wet Seal, Thomas served as president and co-chief executive of Tilly’s from 2005 to 2007. He has a B.S. from Villanova University and is a Certified Public Accountant.
“I am excited to return to Wet Seal, where I have a deep knowledge of the business and strong working relationships with many team members and associates. I also look forward to working with Christine Lee as she now joins the company as our chief merchandising officer,” added Thomas. “While I understand fully the complexities of navigating today’s dynamic retail landscape, I am convinced there is an opportunity to strengthen the Wet Seal brand and look forward to sharing my vision for an improved Wet Seal with our shareholders, team members and customers.”
The retailer's preliminary second quarter results show that consolidated comparable store sales declined 12.4%, including a decline of 11.1% at Wet Seal and a decline of 22.8% at Arden B during the wind-down of that business. Comparable store sales results include e-commerce, which actually increased 11.4%, including a 25.1% increase at Wet Seal, offset by a 24.6% decrease at Arden B during its wind-down. The company reports full financial results Sept. 10. Thomas will be charged with turning things around for the retailer, and the company has offered him incentives to do just that.
The company agreed to issue to Thomas 1,500,000 restricted stock units of the company as well as 2,500,000 performance stock units. The restricted stock units vest in three equal annual installments beginning on the first anniversary of the grant date, subject to the Thomas’ employment with the company through the applicable vesting date. The performance stock units become eligible for vesting in three annual tranches starting on the first anniversary of the grant date subject to the satisfaction of target share price levels, with performance measured over the applicable time periods, subject to Thomas’ continuous employment through the applicable determination date. The target price level for each tranche is set at 125% of the target stock price in the prior period.