Item 5.02Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On April 27, 2021, Duluth Holdings Inc. (the "Company") issued a press release
reporting the appointment of Samuel M. Sato as President and Chief Executive
Officer of the Company, effective May 3, 2021. On May 3, 2021, Mr. Sato will
replace Stephen L. Schlecht as Chief Executive Officer of the Company. It is
anticipated that Mr. Sato will be appointed to the Board of Directors of the
Company (the "Board") on May 27, 2021. Also effective May 27, 2021, Mr.
Schlecht intends to resign as Executive Chairman and transition to non-executive
Chairman of the Board. In addition to holding the management responsibilities as
described in the press release, Mr. Sato will replace Mr. Schlecht as the
Company's principal executive officer for SEC reporting purposes.
Mr. Sato, age 57, served as the Chief Executive Officer of The Finish Line,
Inc., from February 2016 to February 2019, and also served on the Board of
Directors of The Finish Line, Inc. from October 2014 to February 2019. Mr. Sato
previously served as President of The Finish Line, Inc. from October 2014 to
February 2016, President, Finish Line Brand, from October 2012 to October 2014,
and President and Chief Merchandising Officer from October 2010 to September
2012, as well as The Finish Line, Inc.'s Executive Vice President, Chief
Merchandising Officer from to March 2007 to October 2010. Mr. Sato began his
career in 1985 at Nordstrom Inc., where he held various leadership roles within
merchandising. Mr. Sato has been involved in the retail industry for over 30
years.
In consideration of Mr. Sato's employment with the Company, Mr. Sato will
receive, among other things, the following as described in his offer letter:
·An annualized base salary of $800,000;
·Eligibility to participate in the Company's Annual Incentive Plan;
·An initial award of restricted stock, with a grant date fair value of
$1,700,000;
·Eligibility to receive an annual award of restricted stock starting in fiscal
2022 to be based on annual results of his performance review and certain
performance metrics to be determined at a later date;
·A lump sum payment upon certain terminations of his employment during a
specified time period following a change of control of the Company;
·Certain payout benefits upon the termination of his employment as President and
Chief Executive Officer due to death or disability, or termination of his
employment by the Company without cause or termination of his employment by him
for good reason; and
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·Eligibility to participate in the Company's healthcare and other benefit plans,
and the Company's relocation policy.
The Company and Mr. Sato intend to enter into an employment agreement, subject
to approval by Compensation Committee of the Board and Board ratification, which
will supersede the offer letter. Mr. Sato's employment is conditioned on his
execution of that employment agreement.
Since January 29, 2018, there have been no transactions, and there are no
currently proposed transactions, to which the Company was or is a participant
and in which Mr. Sato had or is to have a direct or indirect material interest
that would require disclosure pursuant to Item 404(a) of Regulation S-K.
The foregoing description of the offer letter does not purport to be complete
and is qualified in its entirety by reference to such document, a copy of which
is attached as an exhibit to this filing and incorporated herein by reference.
The Company's press release announcing the hiring of Mr. Sato is attached hereto
as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
10.1 Offer Letter dated April 22, 2021
99.1 Press Release dated April 27, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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