| Item 5.02. |
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements
of Certain Officers. |
On June 10, 2022, the
Board of Directors of Citi Trends, Inc. (the “Company”) appointed Ms. Heather Plutino to serve as its Executive
Vice President, Chief Financial Officer, effective as of June 27, 2022. In this capacity, Ms. Plutino will serve as the Company’s
principal financial officer. On the effective date of Ms. Plutino’s appointment, Jason B. Moschner will cease to serve as the
Company’s principal financial officer but will continue to serve as the Company’s Vice President, Finance and principal accounting
officer.
Ms. Plutino, age 50,
most recently was with Bed Bath & Beyond, as Senior Vice President of FP&A and Commercial Finance from 2020-2022. Prior
to her work with Bed Bath & Beyond, Ms. Plutino was Group Vice President of Finance and Treasurer of Sally Beauty Holdings
from 2018-2020. Previously, Ms. Plutino served as Vice President and Treasurer of ascena retail group from 2013-2018 and held
a variety of finance and treasury roles at Charming Shoppes from 2007-2013 and Target Corporation from 1999-2007. Ms. Plutino has
an MBA from Washington University and a Bachelor of Business Administration degree in Finance from James Madison University.
Ms. Plutino will receive
a base salary of $475,000 per year and will be eligible to earn an annual cash incentive with a target amount equal to 65% of her base
salary, with an opportunity to earn 200% of the target amount based on achievement of certain earnings targets for the Company. Ms. Plutino
will also be eligible to receive annual equity incentive awards. In addition, Ms. Plutino will receive a one-time sign-on grant of time-based
restricted stock and performance-based stock units having a grant date value of $308,750, to be granted on June 27, 2022. The
time-based restricted stock will vest in three equal annual installments on the first three anniversaries of the grant date, and the performance-based
stock units will vest based on achievement of performance goals over a three-year performance period. Ms. Plutino will also receive
a $75,000 relocation bonus to be paid in cash upon commencement of her employment.
Ms. Plutino entered into
an Employment, Non-Compete, Non-Solicit and Confidentiality Agreement (the “Restrictive Covenant Agreement”) and a Severance
Agreement (the “Severance Agreement”) with the Company. Pursuant to the Restrictive Covenant Agreement, Ms. Plutino has
agreed to (i) not work for a competitor during the term of her employment or for one year following termination of employment with
the Company, (ii) not solicit any of the Company’s merchandise vendors for a period of eighteen months following termination
of employment with the Company, and (iii) not solicit any employee of the Company during the term of her employment or for a period
of two years following termination of employment with the Company, in each case, regardless of the reason for termination. Pursuant
to the Severance Agreement, if the Company terminates Ms. Plutino’s employment without Cause (as defined in the Severance Agreement)
or if she terminates her employment within twelve months of a Change in Control (as defined in the Severance Agreement), provided that
within such period Ms. Plutino’s job duties have been materially diminished or compensation has been materially decreased,
the Company will provide her with separation payments of twelve months base salary, and will pay her the full monthly cost, less applicable
tax withholdings, to provide the same level of group health insurance maintained by her as of her separation from service for twelve months.
The summary of the Restrictive
Covenant Agreement and the Severance Agreement above does not purport to be complete and is qualified in its entirety by reference to
such agreements, copies of which are attached to this report as Exhibits 10.1 and 10.2, respectively, and are incorporated herein by reference.
No family relationships exist
between Ms. Plutino and any of the Company’s directors or other executive officers. There are no arrangements between Ms. Plutino
and any other person pursuant to which Ms. Plutino was selected as an officer, nor are there any transactions to which the Company
is or was a participant and in which Ms. Plutino has a material interest subject to disclosure under Item 404(a) of Regulation
S-K.
A copy of the press release
announcing the appointment of Ms. Plutino as the Chief Financial Officer is attached to this report as Exhibit 99.1 and is incorporated
herein by reference.