Guess?, Inc. today issued the following statement regarding recent public commentary by Legion Partners.
Guess has a long track record of shareholder engagement and responsiveness. In line with this, members of our Board of Directors and management have met with representatives of Legion Partners to better understand their views and engage constructively for the benefit of all shareholders.
The Guess Board reached out to Legion Partners to propose a mutually agreeable path forward. Contrary to what Legion Partners stated in its March 9, 2022 press release, Guess discussed a number of potential solutions, including not only a new ESG committee of the Board with a strong oversight mandate, but also a significant capital allocation program to benefit all Guess shareholders, and other measurable governance commitments.
In addition, the Guess Board notified Legion Partners in advance of its plan to set an annual meeting date that would allow Guess shareholders the earliest opportunity to vote on the matters that Legion Partners has raised. The Board also communicated to Legion Partners that the earlier annual meeting date was set to minimize the disruption and management distraction being caused by Legion’s campaign.
Despite our efforts to engage constructively, Legion Partners immediately and summarily rejected our attempts to find common ground and has instead decided to take further public action. While Legion Partners is entitled to their own opinions and views, we are deeply concerned by the creation of their own “facts.”
Legion Partners’ claim that the Board has ‘turned a blind eye’ to allegations regarding Paul Marciano is demonstrably false. The Guess Board takes allegations of sexual impropriety or unethical conduct extremely seriously. In 2018, the Guess Board established a Special Committee, comprised entirely of independent directors and advised by independent legal counsel, to conduct a comprehensive investigation. The investigation included more than 40 personal interviews and reviewed over 1.5 million pages of documents and the findings were made public in June 2018.
The Board’s decision to continue to employ Paul Marciano and re-nominate him as a director was informed by the findings of the months-long Special Committee investigation, which was determined to be more comprehensive, conclusive and accurate than anything reported in the media or elsewhere.
In January 2022, Legion Partners delivered a Demand for Board Action. The Board promptly created a committee of independent directors (the “Demand Review Committee”) to investigate the subject matter of the demand, including the post-2018 allegations. With the assistance of independent legal counsel, the Demand Review Committee will make recommendations to the full Board about the proper response to the Demand after it completes its investigation.
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In addition, Legion Partners’ allegation that Maurice Marciano has been wielding his influence in the boardroom to impact decisions around Paul Marciano is false. Maurice Marciano is not involved in Board discussions regarding Paul Marciano – he has and continues to recuse himself from Board deliberations related to his brother. The Board and management team deeply value Maurice Marciano’s contributions as a founder and creator of Guess, and a dedicated long-time executive and director of the Company. Maurice Marciano’s unfortunate cycling accident has presented some physical health challenges from which he is recovering steadily. As a director, he remains fully informed and highly engaged in the Board’s oversight of the Company. As his condition has continued to improve, he has attended four of the last five Board meetings. His deep understanding of the brand and business, and his significant ownership stake, make him a trusted and valuable member of the Board.
We remain extremely focused on delivering value for all Guess shareholders by executing on our strategic plan. Our transformation strategy is working, and it is driving momentum in the business. As we continue to elevate the Guess and Marciano brands, redefine the Company’s global e-commerce strategy and drive efficiencies across the business, we are delivering meaningful results as demonstrated by our third quarter 2022 performance. Importantly, as our full-year guidance indicates, we expect to report the Company’s best full-year results of the last decade.
In both Legion Partners’ public correspondence and private dialogue with us, Legion Partners has complimented the Company’s current transformation strategy and our strong business performance. We look forward to further building on our progress to position Guess as an industry leader that is delivering sustainable value creation.
On March 4, 2022, the Company announced that Guess’ 2022 annual meeting of shareholders would be held virtually on Friday, April 22, 2022 at 9:00 a.m. (PDT). Shareholders do not need to take any action at this time.
Source: Guess?, Inc.