Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
Appointment of Chief Financial Officer
On June 9, 2023, the Board of Directors (the "Board") of Five Below, Inc. (the
"Company") appointed Kristy Chipman as the Company's Chief Financial Officer,
effective on or about July 17, 2023. Ms. Chipman will assume the roles of
principal financial officer and principal accounting officer from Kenneth Bull,
who was promoted to the role of Chief Operating Officer earlier this year.
In connection with her appointment, the Company entered into a letter agreement
with Ms. Chipman on June 13, 2023 to set forth the initial terms of her
employment and compensation. The letter agreement provides that Ms. Chipman will
have an initial base salary of $600,000 per year and a target payout under the
Company's short-term (i.e., annual) incentive plan equal to 75% of her base
salary (provided that her actual payout for any year may range from zero to 200%
of target, depending on actual individual and/or corporate performance in that
year).
In addition, the offer letter provides that Ms. Chipman will receive a new hire
equity grant of a number of time-vested restricted stock units ("RSUs")
determined by dividing $250,000 by the closing price of the Company's common
stock on her start date. Subject to her continued service through the applicable
vesting date, 50% of these RSUs will vest on the second anniversary of the grant
date, and 25% of these RSUs will vest on each of the third and fourth
anniversaries of the grant date.
The offer letter also describes Ms. Chipman's 2023 and 2024 annual equity
awards, which awards will have intended values at grant of $500,000 and
$700,000, respectively. In each case, 75% of the annual equity award value will
be allocated to performance-based restricted stock units ("PRSUs") and 25% of
the annual equity award value will be allocated to RSUs. These values will be
converted into a number of PRSUs or RSUs by dividing the relevant dollar amount
by the closing price of the Company's common stock on the applicable grant date.
The PRSUs will be subject to vesting over three years, based on Ms. Chipman's
continued service and subject to the achievement of performance metrics
established by the Compensation Committee of the Board. The RSUs will be subject
to vesting based on Ms. Chipman's continued service, on the same schedule as
described above with respect to her new hire equity award.
The offer letter also provides that Ms. Chipman will participate in the
Company's Executive Severance Plan. The Executive Severance Plan currently
provides that, if the employment of an executive at Ms. Chipman's level is
terminated by the Company without cause or by the executive with good reason, he
or she will be eligible for the following severance benefits following execution
of a release of claims: (i) a lump sum payment equal to 12 months of base
salary, plus (ii) reimbursement of the applicable premium for COBRA continuation
coverage for up to 12 months, to the extent that premium exceeds the amount
charged to active employees for comparable coverage.
Finally, the offer letter requires Ms. Chipman to enter into a Restrictive
Covenant Agreement containing customary covenants regarding confidentiality and
intellectual property and prohibiting Ms. Chipman from directly or indirectly
competing with the Company or soliciting employees of the Company for 12 months
following the cessation of her relationship with the Company.
The foregoing description of the letter agreement does not purport to be
complete and is subject to, and qualified in its entirety by, the full text of
the letter agreement and its exhibits, copies of which are filed as Exhibit 10.1
hereto and incorporated by reference herein.
Prior to joining the Company, Ms. Chipman served as Executive Vice President,
Chief Financial Officer and Chief Operating Officer of Ruth's Hospitality Group,
Inc., a fine dining steakhouse company, from November 2020, and prior to that as
Chief Financial Officer of Orangetheory Fitness, a global fitness franchise,
from September 2019 to October 2020. Prior to that, Ms. Chipman served as Vice
President, Finance, International and information Technology and later Vice
President, Finance and Treasurer at Domino's Pizza, a leading pizza delivery
company, from August 2016 to August 2019. Prior to that, Ms. Chipman served in a
variety of roles at McDonald's Corporation and as an auditor at Crowe Chizek, an
accounting firm.
Ms. Chipman holds a bachelor's degree in accounting from Illinois Wesleyan
University and a Master of Business Administration from DePaul University's
Kellstadt Graduate School of Business.
No family relationship exists between Ms. Chipman and any of the Company's
directors or executive officers. There are no arrangements or understandings
between Ms. Chipman and any other person pursuant to which Ms. Chipman was
selected as an officer of the Company, nor are there
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any transactions to which the Company is or was a participant and in which
Ms. Chipman had or will have a direct or indirect material interest subject to
disclosure under Item 404(a) of Regulation S-K.
Resignation of Director
On June 13, 2023, Catherine E. Buggeln advised the Board of her decision to
resign from the Board effective June 14, 2023. Ms. Buggeln's decision to resign
was not the result of any disagreement with the Company or its management.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year
At the 2023 Annual Meeting of Shareholders of the Company held on June 13, 2023
(the "Annual Meeting"), the
Company's shareholders approved proposals to amend the Company's Amended and
Restated Bylaws, as amended, to: (i) limit the liability of officers; and
(ii) amend the limitation of liability of directors provision (the
"Amendments"), as permitted by Section 1735 and Section 1713 of Pennsylvania
Business Corporation Law of 1988, respectively. The Board previously approved
the Amendments, subject to receipt of shareholder approval at the Annual
Meeting; therefore the Amendments took immediate effect after the Annual
Meeting. The foregoing descriptions are summaries only, and are qualified in
their entirety by reference to the complete text of the Amended and Restated
Bylaws, which is being filed as Exhibit 3.1 to this Form 8-K.
Item 5.07 Submission of Matters to a Vote of Security Holders
A total of 55,663,461 shares of the Company's common stock were entitled to vote
as of April 18, 2023, the record date for the Annual Meeting, of which
52,588,293 were present in person or by proxy at the Annual Meeting. The
following is a summary of the final voting results for each matter presented to
shareholders, which are described in detail in the Company's definitive proxy
statement for the Annual Meeting, filed with the U.S. Securities and Exchange
Commission on May 3, 2023.
PROPOSAL 1: Election of three Class II Directors to hold office until the 2024
Annual Meeting of Shareholders.
Name For Against Abstentions Broker Non-Votes
Joel D. Anderson 50,487,445 593,359 23,243 1,484,246
Kathleen S. Barclay 48,122,677 2,957,915 23,455 1,484,246
Thomas M. Ryan 46,112,343 4,968,123 23,581 1,484,246
PROPOSAL 2: Ratification of the appointment of KPMG LLP as the Company's
independent registered public accounting firm for the fiscal year ending
February 3, 2024.
Votes For Votes Against Abstentions Broker Non-Votes
51,197,721 1,367,284 23,288 0
PROPOSAL 3: Approval on an advisory (non-binding) basis of the Company's named
executive officer compensation.
Votes For Votes Against Abstentions Broker Non-Votes
48,447,987 2,621,692 34,368 1,484,246
PROPOSAL 4: Amendment to the Company's Amended and Restated Bylaws to limit the
liability of officers.
Votes For Votes Against Abstentions Broker Non-Votes
46,474,443 4,591,408 38,196 1,484,246
PROPOSAL 5: Amendment to the Company's Amended and Restated Bylaws to amend the
limitation of
liability of directors provision.
Votes For Votes Against Abstentions Broker Non-Votes
50,622,311 314,286 167,450 1,484,246
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Item 7.01 Regulation FD Disclosure
On June 14, 2023 the Company issued a press release announcing the Chief
Financial Officer appointment described above. A copy of the press release is
furnished as Exhibit 99.1 hereto.
The information in Item 7.01 of this Current Report and Exhibit 99.1 attached
hereto shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended or incorporated by reference in any filing
under the Securities Act of 1933 as amended, except as shall be expressly set
forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
3.1 Amended and Restated Bylaws of Five Below, Inc.
10.1 Offer Letter, dated June 13, 2023.
99.1 Press Release, dated June 14, 2023.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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