Last Chance to Vote: Doug Bergeron Urges Ethan Allen Shareholders to Elect a New Board Majority and Releases Concluding Video Message to Investors and Employees

Doug Bergeron, Ethan Allen shareholder and activist investor

“Replacing a minority of the incumbent directors will not change Ethan Allen's trajectory. After 15 consecutive quarters of year-over-year sales declines, the Board has scheduled its latest financial results for after shareholders vote on the composition of the Board. For years, Ethan Allen's proxy statements also did not disclose that director Cynthia Ekberg Tsai, now overseeing CEO succession, had been sued over allegations that she abused her positions as CEO and director of another public company, sanctioned by a court and held in civil contempt for destroying evidence, and terminated from her role 'for cause'.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“These are fundamental questions of transparency, judgment and accountability. Shareholders cannot afford to risk another year of operational decline. Under the Company's own timetable, the Board elected on November 4 will select Ethan Allen's next CEO before shareholders have another opportunity to vote at an annual meeting. Returning an incumbent majority to control CEO selection, strategic direction and capital allocation is not a mandate for fundamental change. It leaves the status quo in control.”

Glass Lewis, Proxy advisory firm

“...the greater risk at this time appears to be entrusting critical oversight responsibilities to a board that has consistently failed to deliver on matters of operational accountability, shareholder value and executive succession...”

Glass Lewis, Proxy advisory firm

“...Ethan Allen's overly familiar strategic assurances, protracted operational regression, muddled capital priorities and questionable governance architecture functionally reinforce a long-standing, value-crimping divide between optimistic messaging and moribund execution.”

Institutional Shareholder Services Inc., Proxy advisory firm

“...the board's ability to identify, attract, and retain a successor may itself be constrained by a governance and management framework that has become closely associated with Kathwari's leadership and influence.”

Institutional Shareholder Services Inc., Proxy advisory firm

“Moreover, the board's approach to this contest has featured tactics of diversion and obfuscation. These are damaging, in that they compromise the ability of shareholders to trust the board, particularly on important matters like a CEO succession.”

Egan-Jones Proxy Services, Proxy advisory firm

“The key difference between the two sides is not the diagnosis but the ability to act on it. Management has described the same problems, and the same fixes, for well over a decade... Each time, it said the company was positioned for growth. The results never followed.”

Egan-Jones Proxy Services, Proxy advisory firm

“The DGB slate is highly qualified and was built to fill the exact gaps the incumbent Board lacks: modern retail, home furnishings, digital commerce, and brand revitalization.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“ISS identified Kathwari's extraordinary influence over the Board as a central governance problem and recommended removing him and Lead Independent Director David Sable. Yet replacing only those two would leave three incumbents in control. After nearly four decades as Chairman and CEO, removing Kathwari from the Board while leaving him as CEO would do little to diminish his influence over the very Board charged with selecting his successor. The other incumbent directors are not innocent bystanders to Ethan Allen's operational decline and governance failures.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“Ethan Allen’s shareholders deserve better. We intend to establish a fundamentally different standard of transparency, accountability and shareholder alignment: timely financial reporting, full disclosure of relevant director backgrounds, clear operating KPIs and strategic milestones, candid investor communication, meaningful director ownership and executive compensation aligned with long-term shareholder value creation.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“Our five highly qualified nominees bring complementary experience in public-company leadership, home furnishings, modern retail, merchandising, digital commerce, manufacturing and operational transformation. We have identified proven retail operator Stefanie Tsen Ward as our proposed interim CEO, subject to appointment by the newly elected Board, and developed a disciplined 100-day plan to ensure continuity, establish accountability and begin restoring profitable growth.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“I've spent my career transforming businesses and creating shareholder value, including at VeriFone and Cantaloupe. My track record is public, measurable and available for every shareholder to judge. I've invested substantial personal capital in Ethan Allen because I believe deeply in its potential. But after two decades of declining performance and inadequate governance, realizing that potential requires more than incremental change.”

Doug Bergeron, Ethan Allen shareholder and activist investor

“I recognize that entrusting a new team with majority control is a significant decision, and I do not take that responsibility lightly. But leaving the same directors in control is not a mandate for change. I'm asking my fellow shareholders to give us the opportunity to restore growth and create lasting shareholder value. We intend to earn your trust through disciplined execution, transparency, accountability and results.”