UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Date of Report (Date of Earliest Event Reported):
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March 29, 2019
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Kirkland’s, Inc.
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(Exact name of registrant as specified in its charter)
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Tennessee
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000-49885
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62-1287151
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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5310 Maryland Way, Brentwood, Tennessee
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37027
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code:
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615-872-4800
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Not Applicable
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Former name or former address, if changed since last report
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On
March 29, 2019
, Kirkland’s, Inc. (the “Company”), entered into a retention agreement with Mike Cairnes, the Company’s President and Chief Operating Officer (the “Cairnes Retention Agreement”), pursuant to which he has an opportunity to receive a $100,000 retention bonus. Mr. Cairnes will receive $50,000 if he remains with the Company through July 1, 2019, and another $50,000 if he remains with the Company through January 1, 2020. In the event that Mr. Cairnes is terminated without cause or if he quits for good reason during the time period from now through July 1, 2019, he shall be entitled to receive, promptly after such separation of service, $100,000. In the event that Mr. Cairnes is terminated without cause or if he quits for good reason during the time period from July 1, 2019 through January 1, 2020, he shall be entitled to receive, promptly after such separation of service, $50,000. These amounts are in addition to any amount that Mr. Cairnes might be owed pursuant to his November 9, 2016 employment agreement with the Company. The preceding description of the Cairnes Retention Agreement is a summary of its material terms, does not purport to be complete, and is qualified in its entirety by reference to the Cairnes Retention Agreement, a copy of which is being filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
On
March 29, 2019
, the Company entered into a retention agreement with Nicole Strain, the Company’s interim Chief Financial Officer (the “Strain Retention Agreement”), pursuant to which she has an opportunity to receive a $50,000 retention bonus. Ms. Strain will receive $25,000 if she remains with the Company through July 1, 2019, and another $25,000 if she remains with the Company through January 1, 2020. In the event that Ms. Strain is terminated without cause or if she quits for good reason during the time period from now through July 1, 2019, she shall be entitled to receive, promptly after such separation of service, $50,000. In the event that Ms. Strain is terminated without cause or if she quits for good reason during the time period from July 1, 2019 through January 1, 2020, she shall be entitled to receive, promptly after such separation of service, $25,000. The preceding description of the Strain Retention Agreement is a summary of its material terms, does not purport to be complete, and is qualified in its entirety by reference to the Strain Retention Agreement, a copy of which is being filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibit is furnished as part of this Report:
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Kirkland’s, Inc.
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March 29, 2019
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By:
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/s/ Carter R. Todd
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Name: Carter R. Todd
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Title: Vice President and General Counsel
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5310 Maryland Way
Brentwood, TN 37027
United States Of America
March 29, 2019
Via Hand Delivery
Mr. Mike Cairnes
Dear Mike:
On behalf of Kirkland’s Inc. (the “
Company
”), this letter agreement addresses your continuing role with the Company. We appreciate your willingness to continue to serve the Company.
As you know, the Company has hired a new Chief Executive Officer, and needs to retain your services while the new CEO has an opportunity to implement the Company’s new business plan. Accordingly, if you remain employed by the Company through July 1, 2019, you will be paid a bonus of $50,000 promptly thereafter (the “
July
Retention Bonus
”). In addition, if you remain employed by the Company through January 1, 2020, you will be paid an additional bonus of $50,000 promptly thereafter (the “
January Retention Bonus
”). Further, if you are terminated without cause (as defined below) or if you quit for good reason (as defined below) during the time period from now through July 1, 2019, you shall be entitled to receive, promptly after such separation of service, both the July Retention Bonus and the January Retention Bonus. If you are terminated without cause (as defined below) or if you quit for good reason (as defined below) during the time period from July 1, 2019 through January 1, 2020, you shall be entitled to receive, promptly after such separation of service, the January Retention Bonus.
As used above the term “cause” shall mean the occurrence of any of the following, as determined in good faith by the Company: (i) alcohol abuse or use of controlled drugs (other than in accordance with a physician’s prescription) by you; (ii) illegal conduct or gross misconduct by you which is materially and demonstrably injurious to the Company, without limitation, fraud, embezzlement, theft or proven dishonesty; (iii) your conviction of a misdemeanor involving moral turpitude or a felony; (iv) your entry of a guilty or
nolo
contendere
plea to a misdemeanor involving moral turpitude or a felony, (v) your material breach of any agreement with, or duty owed to, the Company or its affiliates, or (vi) your failure, refusal or inability to perform, in any material respect, your duties to the Company or its Affiliates, which failure continues for more than fifteen (15) days after written notice thereof from the Company.
The term “good reason” shall mean the occurrence of any of the following: (i) the assignment of any duties inconsistent with your position, authority, duties or responsibilities, or any other action by the Company which results in a material diminution in such position, authority, duties or responsibilities; (ii) a reduction by the Company in your annual salary, provided that if the salaries of substantially all of the Company’s senior executive officers (including the Company’s CEO) are contemporaneously and proportionately reduced, a reduction in your salary will not constitute “Good Reason” hereunder; (iii) the failure by the Company, without your consent, to pay to you any portion of your current compensation, except pursuant to a compensation deferral elected by you, other than an isolated and inadvertent failure which is remedied by the Company promptly after receipt of notice from you; (iv) the relocation of the Company’s principal executive offices to a location more than 35 miles from the current location of such offices, or the Company’s requiring you to be based anywhere other than the Company’s principal executive offices, except for required travel on the Company’s business; or (v) the failure of the Company to obtain a satisfactory agreement from any successor to assume and agree to perform this agreement.
Except as expressly provided above, your employment with the Company will continue on the same terms as provided in your November 9, 2016 Employment Agreement, as amended by that Amendment No. 1 to Employment Agreement dated as of September 21, 2018. To acknowledge your agreement with the foregoing, please execute and date this letter in the space provided below and return the executed original to me.
Sincerely,
Kirkland’s Inc.
By:
/s/ Steve C. Woodward
Title:
Chief Executive Officer
Agreed on March 29, 2019:
/s/ Michael B. Cairnes
Michael B. Cairnes
5310 Maryland Way
Brentwood, TN 37027
United States Of America
March 29, 2019
Via Hand Delivery
Ms. Nicole Strain
Dear Nicole:
On behalf of Kirkland’s Inc. (the “
Company
”), this letter agreement addresses your continuing role with the Company. We appreciate your willingness to continue to serve the Company.
As you know, the Company has hired a new Chief Executive Officer, and needs to retain your services while the new CEO has an opportunity to implement the Company’s new business plan. Accordingly, if you remain employed by the Company through July 1, 2019, you will be paid a bonus of $25,000 promptly thereafter (the “
July
Retention Bonus
”). In addition, if you remain employed by the Company through January 1, 2020, you will be paid an additional bonus of $25,000 promptly thereafter (the “
January Retention Bonus
”). Further, if you are terminated without cause (as defined below) or if you quit for good reason (as defined below) during the time period from now through July 1, 2019, you shall be entitled to receive, promptly after such separation of service, both the July Retention Bonus and the January Retention Bonus. If you are terminated without cause (as defined below) or if you quit for good reason (as defined below) during the time period from July 1, 2019 through January 1, 2020, you shall be entitled to receive, promptly after such separation of service, the January Retention Bonus
As used above the term “cause” shall mean the occurrence of any of the following, as determined in good faith by the Company: (i) alcohol abuse or use of controlled drugs (other than in accordance with a physician’s prescription) by you; (ii) illegal conduct or gross misconduct by you which is materially and demonstrably injurious to the Company, without limitation, fraud, embezzlement, theft or proven dishonesty; (iii) your conviction of a misdemeanor involving moral turpitude or a felony; (iv) your entry of a guilty or
nolo
contendere
plea to a misdemeanor involving moral turpitude or a felony, (v) your material breach of any agreement with, or duty owed to, the Company or its affiliates, or (vi) your failure, refusal or inability to perform, in any material respect, your duties to the Company or its Affiliates, which failure continues for more than fifteen (15) days after written notice thereof from the Company.
The term “good reason” shall mean the occurrence of any of the following: (i) the assignment of any duties inconsistent with your position, authority, duties or responsibilities, or any other action by the Company which results in a material diminution in such position, authority, duties or responsibilities; (ii) a reduction by the Company in your annual salary, provided that if the salaries of substantially all of the Company’s senior executive officers (including the Company’s President and CEO) are contemporaneously and proportionately reduced, a reduction in your salary will not constitute “Good Reason” hereunder; (iii) the failure by the Company, without your consent, to pay to you any portion of your current compensation, except pursuant to a compensation deferral elected by you, other than an isolated and inadvertent failure which is remedied by the Company promptly after receipt of notice from you; (iv) the relocation of the Company’s principal executive offices to a location more than 35 miles from the current location of such offices, or the Company’s requiring you to be based anywhere other than the Company’s principal executive offices, except for required travel on the Company’s business; or (v) the failure of the Company to obtain a satisfactory agreement from any successor to assume and agree to perform this agreement. For the avoidance of doubt, failure to name you permanent Chief Financial Officer shall not be deemed a material diminution in your position, authority, duties or responsibilities within the meaning of clause (i) of the above definition, and a reduction in your annual salary as a result of your resuming the role of Controller shall not be deemed a breach of class (ii) of the above definition.
Except as expressly provided above, your employment will continue on the same basic terms as in place prior to the date of this letter, and both parties hereto acknowledge that your employment relationship with the Company remains an “at will” relationship. To acknowledge your agreement with the foregoing, please execute and date this letter in the space provided below and return the executed original to me.
Sincerely,
Kirkland’s Inc.
By:
/s/ Steve C. Woodward
Title:
Chief Executive Officer
Agreed on March 29, 2019:
/s/ Nicole A. Strain
Nicole A. Strain
