Attached files
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EX-99.1 - EXHIBIT 99.1 - BON TON STORES INC | c11432exv99w1.htm |
EX-10.1 - EXHIBIT 10.1 - BON TON STORES INC | c11432exv10w1.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 21, 2011
THE BON-TON STORES, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania | 0-19517 | 23-2835229 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
2801 E. Market Street, York, Pennsylvania |
17402 |
|
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: 717-757-7660
Not Applicable
(Former name or former address, if changed since last report.)
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:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.02. Termination of Material Definitive Agreement
On January 21, 2011, The Bon-Ton Stores, Inc. (the Company) notified Stephen Byers, Vice
Chairman Stores, Visual, Construction, Real Estate, Distribution & Logistics, Loss Prevention,
who has an employment agreement with the Company dated as of February 1, 2009 (the Employment
Agreement), that the term of the Employment Agreement will not be automatically renewed when the
current term expires on April 30, 2011. The Employment Agreement was filed as Exhibit 10.4 to the
Companys Current Report on Form 8-K filed with the Securities and Exchange Commission on January
28, 2009, and the description of the Employment Agreement contained in such filing is incorporated
herein by reference. The notice provided to Mr. Byers is a notice of non-renewal of the Employment
Agreement only and does not terminate Mr. Byers employment with the Company. The Company is
currently negotiating a new employment agreement to be entered into with Mr. Byers, which it
anticipates executing prior to the expiration of the current term of the Employment Agreement on
April 30, 2011.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.
(e) Compensatory Arrangements of Certain Officers
On January 24, 2011, the Company issued a press release announcing the amendment, on January
21, 2011 (the Fifth Amendment), of the Employment Agreement by and between the Company and Byron
L. Bergren, the Companys President and Chief Executive Officer. Mr. Bergrens Employment Agreement
(the 2004 Agreement) was entered into on August 24, 2004, a First Amendment to the 2004 Agreement
(the First Amendment) was entered into on May 1, 2005, a Second Amendment to the 2004 Agreement
(the Second Amendment) was entered into on May 23, 2006, a Third Amendment to the 2004 Agreement
(the Third Amendment) was entered into on July 19, 2007, and a Fourth Amendment to the 2004
Agreement (the Fourth Amendment) was entered into on March 18, 2009. Collectively, the 2004
Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment and Fifth Amendment
are referred to as the Agreement.
The description of the material terms of the Fifth Amendment set forth below is qualified in
its entirety by the Fifth Amendment, which is attached hereto as Exhibit 10.1 and incorporated
herein by reference. The full text of the press release is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
The Fifth Amendment provides that Mr. Bergren will serve as President and Chief Executive
Officer through February 5, 2012. Thereafter, Mr. Bergrens term as President and Chief Executive
Officer will automatically renew for successive periods of one year unless either the Company or
Mr. Bergren elects not to renew Mr. Bergrens term as President and Chief Executive Officer (the
CEO Term), in which event the CEO Term shall terminate at the end of the then current CEO Term.
If the Company elects not to renew the CEO Term, the Company shall cause Mr. Bergren to
continue to be elected as a Director and to be appointed as the non-executive Chairman of the
Board, in each case through the date of the first annual meeting of shareholders of the Company
that is at least 12 months following the termination of the CEO Term. If Mr. Bergren elects not to
renew the CEO Term, the Company shall cause Mr. Bergren to continue to be elected only as a
director through the date of the first annual meeting of shareholders of the Company that is at
least 12 months following the termination of the CEO Term.
Mr. Bergrens base salary of $1,000,000 will remain in effect through February 5, 2012. In
addition, the Fifth Amendment provides for a bonus opportunity for fiscal year 2011 pursuant to the
Companys Cash Bonus Plan, with a target bonus of 100% of Mr. Bergrens Base Salary. This bonus
will be determined in accordance with performance objectives to be determined by the Human
Resources and Compensation Committee of the Board (HRCC) consistent with the Cash Bonus Plan.
For each fiscal year after fiscal year 2011 during which Mr. Bergren serves as President and
Chief Executive Officer of the Company, he shall be eligible for a cash bonus under the Cash Bonus
Plan with a target bonus of one hundred percent (100%) of his Base Salary. The cash bonus shall be
determined and awarded in accordance with objectives to be determined by the HRCC consistent with
the Cash Bonus Plan. He will also be eligible for additional stock grants under the Omnibus
Incentive Plan with respect to such renewal period, if awarded and as determined by the HRCC in its
reasonable discretion, upon review by the HRCC of appropriate market comparisons and commensurate
with his position as CEO.
The Fifth Amendment amends the occasions on which the Company must make a payment to Mr.
Bergren upon a Change of Control (as defined in the Third Amendment), as follows. If Mr. Bergren
is discharged without Cause (as defined in the 2004 Agreement) during the term of the Agreement
following a Change of Control, or if Mr. Bergren resigns from the Company with or without Good
Reason (as defined in the Fourth Amendment and as amended in Fifth Amendment) during the term of
the Agreement after the expiration of three months following a Change of Control, or if Mr. Bergren
receives a notice of non-renewal of the CEO Term and certain other conditions related to a Change
of Control are satisfied, Mr. Bergren will receive a payment equal to the lesser of 2.99 times his
base salary (at the salary level immediately preceding the Change of Control) plus his average
bonus for the three immediately preceding fiscal years or, if applicable, the 280G Permitted
Payment (as such term is defined in the Third Amendment).
The Fifth Amendment further provides that the Company will pay the reasonable legal fees, up
to $10,000, incurred by Mr. Bergren in connection with the negotiation of the Fifth Amendment.
Forward-Looking Statements
Certain information included in this report and other materials filed or to be filed by the
Company with the Securities and Exchange Commission contain statements that are forward-looking
within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, which may be identified by words such as may, could, would, will, plan,
expect, believe, anticipate, estimate, project, intend or other similar expressions,
involve important risks and uncertainties that could significantly affect results in the
future and, accordingly, such results may differ from those expressed in any forward-looking
statements made by or on behalf of the Company. Factors that could cause such differences include,
but are not limited to, risks related to retail businesses generally; a significant and prolonged
deterioration of general economic conditions which could negatively impact the Company, including
the potential write-down of the current valuation of intangible assets and deferred taxes; changes
in the terms of the Companys proprietary credit card program; potential increase in pension
obligations; consumer spending patterns, debt levels, and the availability and cost of consumer
credit; additional competition from existing and new competitors; inflation; deflation; changes in
the costs of fuel and other energy and transportation costs; weather conditions that could
negatively impact sales; uncertainties associated with expanding or remodeling existing stores; the
ability to attract and retain qualified management; the dependence upon relationships with vendors
and their factors; a data security breach or system failure; the ability to reduce or control SG&A
expenses; the incurrence of unplanned capital expenditures; the ability to obtain financing for
working capital, capital expenditures and general corporate purposes; the impact of new regulatory
requirements including the Credit Card Accountability Responsibility and Disclosure Act of 2009 and
the Health Care Reform Act; and the financial condition of mall operators. Additional factors that
could cause the Companys actual results to differ from those contained in these forward-looking
statements are discussed in greater detail under Item 1A of the Companys Form 10-K filed with the
Securities and Exchange Commission.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit Number | Description of Exhibit | |||
10.1 | Fifth Amendment to Employment Agreement with Byron L. Bergren |
|||
99.1 | Press Release issued January 24, 2011 regarding the Fifth
Amendment to Employment Agreement with Byron L. Bergren |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.
The Bon-Ton Stores, Inc. |
||||
By: | /s/ Keith E. Plowman | |||
Keith E. Plowman | ||||
Executive Vice President, Chief Financial
Officer and Principal Accounting Officer |
Dated: January 25, 2011