8-KLeadership ChangesMaterial AgreementsExhibits & Filings

Burlington Stores, Inc. 8-K Report, Material Agreement (Dec 9, 2014)

Filed December 9, 2014For Securities:BURL

Summary

This Form 8-K filing by Burlington Stores, Inc. on December 9, 2014, primarily details an amendment to the employment agreement of its President, CEO, and Chairman, Thomas Kingsbury. The amendment, effective December 8, 2014, introduces significant changes to Mr. Kingsbury's compensation and severance arrangements, including new long-term equity awards, a one-time restricted stock grant, annual retention bonuses, and extended severance and retirement benefits. These modifications signal a commitment to retaining key executive leadership, particularly Mr. Kingsbury, who has been instrumental in the company's operations. Investors should note the structure of the new equity awards, which are tied to base salary and offset by the value of existing stock options, suggesting a performance-linked and value-preserving compensation strategy. The enhanced severance and retirement provisions also indicate a focus on executive stability and long-term alignment with the company's interests.

Key Highlights

  • 1Amendment to CEO Thomas Kingsbury's employment agreement effective December 8, 2014.
  • 2Introduction of Long-Term Incentive Plan (LTIP) Awards for Mr. Kingsbury for fiscal years 2015 through 2019.
  • 3New LTIP Awards are structured as a percentage of base salary minus 'Excess Value' related to existing stock options.
  • 4One-time grant of 150,000 restricted stock units (RSUs) or shares, vesting July 1, 2019, with accelerated vesting provisions.
  • 5Annual retention bonus of $225,000 to be paid on December 15th annually, starting in 2014, subject to continued employment.
  • 6Extension of severance pay and benefits period from two to three years upon termination without Cause or for Good Reason.
  • 7Enhanced retirement provisions, including continued vesting of outstanding incentive equity and extended stock option exercise periods, contingent on consulting services.

Frequently Asked Questions

The main purpose of this 8-K filing is to report an amendment to the employment agreement of Burlington Stores' President, CEO, and Chairman, Thomas Kingsbury. This amendment details changes to his compensation, equity awards, retention bonuses, and severance/retirement benefits.

The new Long-Term Incentive Plan (LTIP) Awards, to be granted annually from 2015 to 2019, will be equal to 450% of his base salary, reduced by the 'Excess Value.' The 'Excess Value' is calculated based on the number of stock options that vest within a 12-month period and the difference between $28.00 and the stock option's exercise price at vesting.

Upon termination without Cause or for Good Reason, the severance pay and benefits period has been extended from two years to three years. In case of Retirement, outstanding unvested incentive equity will continue to vest for one year, and the exercise period for vested stock options will be extended to two years post-retirement, provided he offers consulting services.

Yes, within 30 days of the amendment, Mr. Kingsbury will receive a one-time grant of 150,000 restricted stock units (RSUs) or restricted shares. These are set to vest on July 1, 2019, with provisions for accelerated vesting under certain conditions.