Teen retailer Wet Seal Inc. said Tuesday it plans to pay a turnaround consultant $2.8 million this year.
Wet Seal said in a release that Gold is “instrumental in both the design and execution of the company’s new merchandise strategy.”
Gold is set to remain with Wet Seal until Jan. 31, 2007. The company said he will earn $1.2 million in 2006.
He also is being given 2 million shares of restricted stock that will vest on Jan. 28, 2006 and another 1.75 million shares that have different vesting periods, with some stock grants depending on the clothing retailer’s performance.
Gold has overseen more than 400 stores in Canada and the U.S. in the past.
The company said it plans to take “significant charges” in the quarter ending July 30 related to Gold’s payments. It also could take big charges for all quarters through Jan. 31, 2007, Wet Seal said.
Last month an analyst with B. Riley & Co. downgraded Wet Seal shares, in part citing Gold’s stock and compensation package as well as its stock runup.
Wet Seal has been struggling for the past two years after some fashion missteps. But Wet Seal is showing signs of progress of late.
Wet Seal closed 105 unprofitable stores in the first quarter. It reported a 59% jump in same-store sales for the month of June. Total sales in June rose 23% to $49 million.
Shares of Wet Seal have nearly tripled to $5.9 this year.
