8-KLeadership ChangesMaterial AgreementsExhibits & Filings

Burlington Stores, Inc. 8-K Report, Material Agreement (Jul 7, 2015)

Filed July 7, 2015For Securities:BURL

Summary

This Form 8-K filing from Burlington Stores, Inc. on July 7, 2015, primarily concerns an amendment to the employment agreement of its President, CEO, and Chairman, Thomas Kingsbury. The key change is the elimination of a provision that would have required the company to make a gross-up payment to Mr. Kingsbury to cover certain excise taxes in the event of a change of control. For investors, this amendment is noteworthy as it removes a potential financial liability for the company related to executive compensation in a change of control scenario. While not a direct impact on current operations or financial performance, it demonstrates a shift in the company's approach to executive severance and change of control provisions, potentially reducing future costs for shareholders.

Key Highlights

  • 1Amendment to CEO Thomas Kingsbury's Employment Agreement executed on July 7, 2015.
  • 2The amendment eliminates the company's obligation to provide excise tax gross-up payments to Mr. Kingsbury upon a change of control.
  • 3This change removes a potential future financial liability for Burlington Stores, Inc.
  • 4The amendment relates to Sections 280G and 4999 of the Internal Revenue Code.
  • 5The filing is made on Form 8-K, indicating a material event.
  • 6The amendment was made by and among Burlington Coat Factory Warehouse Corporation, Burlington Coat Factory Holdings, LLC, Burlington Stores, Inc., and Thomas Kingsbury.

Frequently Asked Questions

The main purpose of this 8-K filing is to report an amendment to the employment agreement of Burlington Stores' CEO, Thomas Kingsbury. Specifically, it eliminates a 'gross-up' provision for excise taxes related to change of control payments.

By eliminating the excise tax gross-up, Burlington Stores removes a potential future financial obligation. This means that if a change of control were to occur and Mr. Kingsbury received payments subject to excise taxes, the company would no longer be required to pay those taxes on his behalf, thus potentially saving the company money.

No, this filing does not necessarily indicate an impending change of control. It is an amendment to an existing employment agreement that proactively addresses the terms and conditions related to a potential future change of control scenario.

A 'gross-up' payment is an additional amount paid to an executive to cover the taxes they would owe on certain compensation, particularly in situations like a change of control. In this case, the company would have paid Mr. Kingsbury extra money to offset any excise taxes he had to pay on change-of-control payments.