ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS
On May 7, 2019, Stein Mart, Inc. (the
“Company”) entered into employment agreements with MaryAnne Morin, the Company’s President (the “Morin Employment Agreement”), and James B. Brown, the Company’s Executive Vice President, Chief Financial Officer (the
“Brown Employment Agreement”). The Morin Employment Agreement, which is effective as of December 5, 2018, replaces the previous employment agreement with Ms. Morin dated December 5, 2016. The Brown Employment Agreement
replaces the change in control agreement with Mr. Brown dated December 17, 2018.
The amendments to the Morin Employment
Agreement, which has an initial
two-year
term from the effective date, provide that the agreement will automatically renew for successive
two-year
terms unless the
Company or the executive gives written notice not to renew at least 60 days before the end of the initial term or any renewal term. Other than an update to incorporate Ms. Morin’s increased base salary of $750,000, there are no further
amendments to the Morin Employment Agreement.
The Brown Employment Agreement provides, among other things: (i) for an initial term
of two years that automatically renews for successive
two-year
terms unless the Company or the executive gives written notice not to renew at least 60 days before the end of the initial term or any renewal
term, (ii) an annual base salary of $400,000 per year, subject to periodic review by the Compensation Committee, (iii) if the agreement is not renewed at expiration or Mr. Brown is terminated without cause by the Company or with good
reason by Mr. Brown, severance compensation equal to 100% of annual base salary and continuation of insurance benefits for one year, (iv) if Mr. Brown is terminated with cause by the Company or without good reason by Mr. Brown,
only earned but unpaid base salary through the termination date, (v) if Mr. Brown is terminated without cause by the Company or with good reason by Mr. Brown within two years following a change in control, severance compensation equal
to (a) 200% of annual base salary, (b) 200% of the target bonus in the year of the termination date, and (c) continuation of insurance benefits for two years, (vi) a restrictive covenant against recruiting any Company personnel for two
years following termination, (vii) vesting of all unvested options or restricted shares upon death or disability, and (viii) nine months of annual base salary and a pro rata portion of any Earned Bonus (as defined in the Brown Employment
Agreement), if termination is due to disability, and the full amount of any Earned Bonus for the year of death in the event of termination due to death. Mr. Brown remains eligible for other benefit plans and incentive plans in effect from time
to time.
The foregoing summary of the employment agreements is not complete and is qualified in its entirety by the full text of the
employment agreements, which are attached as Exhibits 10.1 and 10.2 to this Current Report on Form
8-K
and are incorporated by reference herein.