Lululemon Athletica Inc . has reached an agreement with its founder Dennis “Chip” Wilson , ending a proxy battle he launched against the company late last year.
The athleisure retailer said Wilson has agreed to customary standstill, non-disparagement, voting and related provisions for approximately 18 months until 30 days prior to the nomination deadline for the 2028 annual meeting.
“On behalf of the board, we are pleased to reach this agreement with Chip Wilson, which allows Lululemon to focus on continuing to strengthen its performance,” the company’s executive chair, Marti Morfitt, said in a press release.
Wilson, who owns approximately 8.7 per cent of the Lululemon’s outstanding common stock, is the company’s largest non-institutional shareholder.
As part of his proxy contest, Wilson nominated three independent candidates to stand for election to the board of directors at Lululemon’s annual general meeting in June.
Two of his three nominees will join the board as part of the new agreement: Laura Gentile, who formerly worked as chief marketing officer of sports network ESPN, and Marc Maurer, the former co-chief executive of Swiss sportswear company On Holding AG.
“The Board additions Lululemon announced today and strategic changes already made by the team reflect meaningful progress toward restoring the company’s product-first vision and unlocking tremendous value for shareholders,” Wilson said in the press release. “I’m confident Laura and Marc will add value to Lululemon’s board and Eric will continue to make meaningful impact in the challenges he takes on in the future.”
Eric Hirshberg, former chief executive of video game publisher Activision Publishing, Inc., was Wilson’s third nominee.
The company also agreed to appoint an additional director with product and brand expertise in apparel by Oct. 1.
“Lululemon now has a clear path forward for our incoming CEO, Heidi O’Neill, and our leadership team, as we continue to advance our strategies to foster strong brand health, reaccelerate growth, and deliver enhanced value for our shareholders,” said Morfitt.
Lululemon and Wilson also agreed to make a donation supporting athletics, art and landscaping at Kitsilano Beach in Vancouver, where Lululemon was founded , in lieu of expense reimbursement.
The full cooperation agreement between the company and Wilson will be filed with the U.S. Securities and Exchange Commission.
• Email: dpaglinawan@postmedia.com