| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
Chief Executive Officer, President, and Director Separation
On October 17, 2022, Conn’s, Inc. (the “Company”) and Chandra Holt, the Company’s Chief Executive Officer and President, agreed that Ms. Holt will step down from her positions as Chief Executive Officer and President of the Company, effective immediately. Ms. Holt has also resigned from her position as a member of the Board of Directors of the Company (the “Board”), effective immediately. Ms. Holt’s decision is not a result of any disagreement on matters relating to the Company’s operations, policies or practices.
For purposes of the Executive Severance Agreement, dated as of August 9, 2021, by and between the Company and Ms. Holt (the “Severance Agreement”), her departure will be treated as a termination by the Company without Cause (as defined in the Severance Agreement) and Ms. Holt will be entitled to receive the severance benefits set forth in her Severance Agreement on the terms and subject to the conditions therein (including entering into a General Release and Waiver substantially in the form attached as Appendix A to the Severance Agreement). The Severance Agreement was previously filed as Exhibit 10.2 to the Company’s Form 8-K filed with the SEC on August 5, 2021, which is incorporated by reference herein.
A copy of the news release announcing Ms. Holt’s retirement is attached to this Current Report on Form 8-K as Exhibit 99.1.
Chief Executive Officer and President Transition
On October 17, 2022 (the “Effective Date”), the Board appointed Norman L. Miller as the Company’s Interim Chief Executive Officer and President (“Interim CEO”), effective October 18, 2022. Mr. Miller will maintain his position as a member of the Board and as chair of the Board’s Compliance Committee. Mr. Miller will succeed Chandra Holt.
Mr. Miller, 61, most recently served as President and Chief Executive Officer of the Company from September 7, 2015 through August 8, 2021. From August 8, 2021 until April 1, 2022, Mr. Miller served as Executive Chairman of the Board, and since that date, he has continued to serve as a member of the Board.
There is no arrangement or understanding with any person pursuant to which Mr. Miller was appointed as Interim CEO. There are no family relationships between Mr. Miller and any director or executive officer of the Company, and Mr. Miller is not a party to any transaction requiring disclosure under Item 404(a) of Regulation S-K.
Mr. Miller’s Offer Letter
In connection with his appointment as Interim CEO, Mr. Miller entered into an offer letter (the “Offer Letter”) with the Company on the Effective Date setting forth the terms of his employment and compensation. Pursuant to the Offer Letter, Mr. Miller will be entitled to an initial monthly salary of $210,000. Mr. Miller will also be eligible for certain long-term incentive awards under the terms and conditions of the Company’s long-term incentive program. These awards will be in the form of time-based restricted stock units (“RSUs”). Specifically, Mr. Miller will receive an initial grant of such RSUs with a grant date value of $1.0 million (based on the weighted average closing price of the Company’s common stock over the 20 trading day period immediately preceding the date of grant), which will vest, if at all, on the one-year anniversary of the grant date. Following such initial grant and subject to his continued employment as Interim CEO, as of each applicable grant date, Mr. Miller will receive quarterly grants of such RSUs, each of which will have a grant date value of $750,000 (based on the weighted average closing price of the Company’s common stock over the 20 trading day period immediately preceding the date of grant), which will vest, if at all, on the one-year anniversary of the grant date. Any shares received upon vesting of the grants will be subject to a two-year holding period. Any of the foregoing RSUs that are unvested as of the date when Mr. Miller ceases to be an employee and a member of the Board will automatically and immediately be forfeited, except in the event of Mr. Miller’s termination without Cause (as defined in the Offer Letter), in which case such RSUs will automatically and immediately vest.
The Company also entered into an indemnification agreement with Mr. Miller in the form previously filed as Exhibit 10.16 to the Company’s Registration Statement on Form S-1 on September 23, 2003, which is incorporated by reference herein.
The foregoing description of the Offer Letter is not complete and is qualified in its entirety by reference to the complete text of such agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
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