said in a regulatory filing Friday that its chairman is leaving.
The company, which sells music-inspired clothing to a teen clientele, disclosed the news in its proxy statement. Robert Jaffe, who has been chairman since 1992 and is the second-largest shareholder among directors and officers, will leave after the June annual meeting, Hot Topic said. The filing didn't name a replacement.
Jaffe is president and CEO of Sorrento Associates, which is, according to the filing, "the general partner of the Sorrento Venture funds, several of which are shareholders of the company." Jaffe was previously an investment banker with Merrill Lynch, Salomon Brothers and Goldman Sachs.
According to the proxy statement, Jaffe holds 205,580 shares; the only insider with more holdings is Elizabeth McLaughlin, the CEO, who holds 543,177 shares, according to the filing. According to other SEC filings, Jaffe sold 18,000 shares in March, and this week he filed a notice of his intent to sell 25,000 more.
Hot Topic didn't deliver the news in a press release, as is typically the practice when a management change occurs. Jay Johnson, Hot Topic's senior vice president for strategic alliances and investor relations, wasn't immediately available for comment.
One analyst who follows the company noted the changing face of the board of directors. "It wasn't terribly surprising to me because they've been changing their board from their original venture capital investors to traditional retailers," says Marcia Aaron, who covers the company for Pacific Growth Equities. (She has a buy rating on the stock, and her firm doesn't have a banking relationship with Hot Topic.)
Hot Topic, based in City of Industry, Calif., has seen its shares rise around 60% since September. The stock has recently become a
popular target for short-sellers, who doubt the company can meet its growth projections.
Shares were up 31 cents Friday at $24.16.