Following is the complete text of a statement issued Monday by Martha Stewart Living Omnimedia Inc. as posted on the company's Web site:
The Board of Directors of Martha Stewart Living Omnimedia, Inc. (NYSE:MSO) announced today that Martha Stewart has resigned effective immediately as a Director and Chief Creative Officer of the company, and will assume the position of Founding Editorial Director. These actions follow the recent verdict against Ms. Stewart in a personal legal matter unrelated to the company and its businesses.
In making the announcement, Jeffrey Ubben, Chairman of the MSO Board of Directors, said: "The MSO Board respects Martha's decision to resign her officer and director positions. In accepting her resignation, we have decided to create a new, continuing role as Founding Editorial Director — a role that reflects our desire for Martha to continue to make an important contribution to our business. The Board determined that, notwithstanding the significance of the recent verdict, continuing to have the benefit of Martha's unique creative talents and contributions is in the very best interests of MSO and its shareholders."
In her new role, Ms. Stewart will continue to provide creative inspiration for new product design and development; author two pending books, Homekeeping and Baking; undertake contributing editor and television assignments; help continue to build public profiles for MSO's talented core content experts; and provide input on the continuing evolution of MSO and its brand and brand labels and on strategic issues. She will report to the company's CEO, Sharon Patrick.
Ms. Patrick said: "Everyone at MSO recognizes the seriousness of Martha's situation and is deeply saddened. However, all of us also believe that the company and our constituencies benefit most if we are able to continue to take advantage of Martha's creative inspiration and capitalize on her prodigious skills and experience in the domestic arts — from cooking, to gardening, to crafts, to homekeeping. Martha has been instrumental in building our company, 550 employees strong, whose licensed products are sold in more than 5,000 establishments across America, in partnership with over 230 manufacturers and distributors. Retail sales of our licensed products for 2003 were over $1.5 billion. Our publications reach millions of readers each month. Wherever and whenever possible, we believe that MSO and our consumers should not be deprived of Martha's unique gifts."
In commenting on her new role, Ms. Stewart said: "I am taking this action today because it is in the best interests of MSO and because I think it's the right thing to do. I am heartsick about my personal legal situation — and deeply sorry for the pain and difficulties it has caused our employees. I can never thank my MSO colleagues enough for their spirit, resiliency and dedication. I look forward to continuing to collaborate on a wide range of creative ideas with the amazing, talented and hard-working people at this very special company. I also thank our readers, viewers, customers, partners and advertisers for their steadfastness and loyalty."
The Nominating Committee of the company's Board of Directors, with the input of Ms. Stewart, will identify a qualified person to succeed Ms. Stewart on the Board in the normal course of such matters. The Board affirmed that management and Board positions announced in June of last year remain unchanged. Sharon Patrick is President and Chief Executive Officer of the company. Jeffrey Ubben, a founder and Managing Partner of ValueAct Capital Partners, L.P., an investment partnership that owns 22 percent of the Company's Class A common stock, continues as Chairman of the Board; and Arthur Martinez, director and former Chairman and Chief Executive Officer of Sears Roebuck, remains Lead Director, presiding over all meetings of the independent directors of the Board. The leadership of the company's creative enterprise continues to be the responsibility of Gael Towey, Senior Executive Vice President and Creative Director, and Margaret Roach, Executive Vice President and Editor-in-Chief.
Martha Stewart Living Omnimedia, Inc. (MSO) is a leading provider of original how-to information that turns dreamers into doers, inspiring and engaging consumers with unique content and high-quality products for the home. MSO's creative experts develop content within eight core areas — Home, Cooking and Entertaining, Gardening, Crafts, Holiday, Keeping, Weddings, and Baby and Kids — that provide consumers with ideas and products to celebrate their homes and the domestic arts. MSO is organized into four business segments — Publishing, Television, Merchandising and Internet/Direct Commerce.
