Surfstitch chairman survives shareholder’s removal attempt

Sam Weiss, chairman of struggling surfwear retailer, Surfstitch, has survived a shareholder’s attempt to remove him from the post.

Crown Financial, which has a more than a five per cent stake in Surfstitch, had sent the company a notice of requisition to hold the shareholder meeting, after taking legal action against Surfstitch related to a fallout over a content sharing deal, and wanted Weiss removed as a director of Surfstitch.

The board backed Weiss and earlier urged shareholders to vote against the proposal, which the majority did, with 91.78 per cent of the votes cast in favour of keeping the chairman.

Surfstich says it is exploring the option of selling media assets and other asset sales as it faces litigation from Crown Financial group, separate class actions in the Queensland and NSW supreme courts and a continuing ASIC investigation – all of which are expected to impact its cash position.

“I have been involved in the retail trade for the past forty years and have experience in it in Europe, the United States and Asia and have been actively engaged in e-commerce virtually since the beginning of it nearly twenty years ago,” Weiss said prior to the vote.

“I was under no illusions about the degree of difficulty of the task ahead, nor was I when I commenced my appointment with the company.”

Surfstitch went into a trading halt in late May after shareholders launched a potential $100 million class action.

The action launched by law firm Quinn Emanuel in Queensland’s Supreme Court accuses Surfstitch of making misleading statements and forecasts of its 2015/16 earnings.

The company last traded at 6.8 cents a share, significantly lower than its peak of $1.90 a share in December 2015, and is expected to resume trade when it reports its full-year results in August.