lululemon athletica inc. Announces Resignation of CEO Laurent Potdevin
LULU Stock Price Drops 3.11% in After-Market Trading on February 5, 2018
On February 5, 2018, lululemon athletica issued a press release (“lululemon athletica inc. CEO Laurent Potdevin Resigns – Three senior leaders to assume expanded roles reporting to Executive Chairman Glenn Murphy”) which stated, in pertinent part, that lululemon (NASDAQ:LULU)
. . . the healthy lifestyle inspired athletic apparel company, today announced that Laurent Potdevin has resigned as CEO and as a member of the [lululemon] Board of Directors, effective immediately. lululemon expects all employees to exemplify the highest levels of integrity and respect for one another, and Mr. Potdevin fell short of these standards of conduct. The Board of Directors has immediately begun a search process for a proven and highly-experienced global Chief Executive Officer.
“While this was a difficult and considered decision, the Board thanks Laurent for his work in strengthening the company and positioning it for the future,” said Glenn Murphy, Executive Chairman of the Board. “Culture is at the core of lululemon, and it is the responsibility of leaders to set the right tone in our organization. Protecting the organization’s culture is one of the Board’s most important duties.”
lululemon’s Form 8-K issued in this regard stated that on February 2, 2018, Laurent Potdevin resigned as CEO and as a member of lululemon’s board of directors; the board of directors appointed Glenn Murphy to serve as lululemon’s Executive Chairman; and lululemon’s senior leaders will report to Murphy during the search for a replacement CEO. The Form 8-K also stated that
[i]n connection with Mr. Potdevin’s resignation, lululemon entered into a separation agreement and release under which Mr. Potdevin agreed to a general release of claims in favor of lululemon, an extension of his non-solicitation period to a period of 24 months, a covenant not to sue and a covenant of future cooperation. In exchange for these releases and covenants, lululemon agreed to pay Mr. Potdevin a lump sum cash payment of $3,350,000 as soon as practicable after the effective date of the separation, and a cash payment of $1,650,000 to be paid over a period of 18 months in equal monthly installments beginning 60 days after the separation date. Mr. Potdevin will not receive any continued or accelerated vesting of any outstanding equity awards. Mr. Potdevin’s entitlement to this consideration is subject to his continuing compliance with the terms of the separation agreement and release, as well as various other restrictive covenants, including covenants relating to non-competition, non-solicitation, non-disparagement and confidentiality.
See also Yahoo! Finance’s “Lululemon’s CEO resigns over issue of conduct.”
lululemon Stock Price Drops 3.11% in After-Market Trading on News of CEO’s Resignation
On the news of the CEO’s resignation, LULU’s stock price dropped 3.11% in after-market trading from a February 5, 2018 close of $77.41.
lululemon Investors and Shareholders
Kehoe Law Firm, P.C. is investigating whether lululemon and certain of the company’s officers or directors violated securities laws, breached their fiduciary duties or engaged in other unlawful business practices. For more information, please contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected], complete the form above on the right or e-mail [email protected].