The Wet Seal, Inc. to Evaluate and Respond to Clinton Group Consent Materials and Proposed Directors
Company Urges Stockholders to Postpone Making Decision Regarding
Clinton Group Consent Solicitation
Board and Management Remain Focused on Stabilizing Business and
Considering All Options to Enhance Shareholder Value
FOOTHILL RANCH, Calif.--(BUSINESS WIRE)--
The Wet Seal, Inc. (Nasdaq: WTSLA), a leading specialty retailer to
young women, today provided an update on recent developments involving
one of its shareholders, Clinton Group, Inc.
Clinton Group has filed with the Securities and Exchange Commission
preliminary consent solicitation materials seeking stockholder consent
to appoint five new independent directors to replace four of the five
current members of Wet Seal's Board of Directors and fill the one vacant
position.
The Board of Directors of The Wet Seal said: "We believe this is the
wrong time to disrupt our business with a wholesale makeover of the
Board as we prepare for the critical fourth quarter and holiday season.
We recognize the immediate need to improve our performance and enhance
value for all of our shareholders. As we have previously announced, the
Board is in the process of returning to a tested fast fashion strategy
that we believe will have a positive impact on results in a matter of
months, not years. At this important juncture, bringing in a large
number of new directors who are not familiar with the business will
deleteriously affect the Company's ability to improve its performance in
the coming months. That would not be in the best interests of all of our
shareholders."
The Wet Seal announced on August 21 that it is taking steps to stabilize
its business quickly by returning to its core expertise of fast fashion
merchandising. As the Company stated, it believes performance will
bottom out in the third fiscal quarter before showing clear signs of
improvement in sales and profitability in the fourth quarter. The
Company believes it will eventually be able to return to annual EBITDA
of $45 million to $50 million.
"The current Board knows Wet Seal and its strengths and weaknesses. It
is far more capable of managing a quick and seamless return to our
historic and successful fast fashion model than a group of new
directors, no matter how experienced they may be."
The Wet Seal's Board and its advisers are continuing to carefully
evaluate Clinton Group's consent solicitation materials and will respond
when it completes that evaluation.
About The Wet Seal, Inc.
Headquartered in Foothill Ranch, California, The Wet Seal, Inc. is a
leading specialty retailer of fashionable and contemporary apparel and
accessory items. As of August 25, 2012, the Company operated a total of
551 stores in 47 states and Puerto Rico, including 469 Wet Seal stores
and 82 Arden B stores. The Company's products can also be purchased
online at www.wetseal.com
or www.ardenb.com.
For more company information, visit www.wetsealinc.com.
Safe Harbor
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995: This news release contains forward-looking statements as that
term is defined in the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to,
statements that relate to the intent, belief, plans or expectations of
the Company or its management. All forward-looking statements made by
the Company involve material risks and uncertainties and are subject to
change based on factors beyond the Company's control. Accordingly, the
Company's future performance and financial results may differ materially
from those expressed or implied in any such forward-looking statements.
Such factors include, but are not limited to, those described in the
Company's filings with the Securities and Exchange Commission. The
Company will not undertake to publicly update or revise its
forward-looking statements even if experience or future changes make it
clear that any projected results expressed or implied therein will not
be realized.
Additional Information and Where You Can Find It
The Company and certain of its directors and executive officers may be
deemed to be participants in a solicitation of consent revocations from
stockholders in connection with the potential consent solicitation by
Clinton Group, Inc. The Company has filed a preliminary consent
revocation statement with the Securities and Exchange Commission (the
"SEC") in connection with such potential consent solicitation (the
"Consent Revocation Statement"). Information regarding the names of the
Company's directors and executive officers and their respective
interests in the Company by security holdings or otherwise is set forth
in the Company's Definitive Proxy Statement filed with the SEC on April
6, 2012 and a Preliminary Consent Revocation Statement filed September
6, 2012. These documents are available free of charge at the SEC's
website at www.sec.gov.
Additional information regarding the interests of potential participants
will be included in any Consent Revocation Statement and any other
relevant documents filed with the SEC in connection with the possible
consent solicitation.
If the Company files a definitive Consent Revocation Statement with the
SEC, the Company promptly will mail the definitive Consent Revocation
Statement and a form of consent revocation to each stockholder entitled
to deliver a written consent in connection with the possible consent
solicitation. WE URGE INVESTORS TO READ ANY CONSENT REVOCATION STATEMENT
(INCLUDING ANY SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS
THAT THE COMPANY MAY FILE WITH THE SEC WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Stockholders will be
able to obtain, free of charge, copies of any Consent Revocation
Statement and any other documents filed by the Company with the SEC in
connection with the possible consent solicitation at the SEC's website
at www.sec.gov.
The Wet Seal, Inc.
Steven H. Benrubi, 949-699-3947
Source: The Wet Seal, Inc.
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