- Current report filing (8-K)
March 25 2009 - 3:11PM
Edgar (US Regulatory)
UNITED STATES
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
Date of
Report (Date of earliest event reported): March 19, 2009
Citi Trends, Inc.
(Exact name of
registrant as specified in its charter)
Delaware
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000-51315
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52-2150697
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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104
Coleman Boulevard, Savannah, Georgia
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31408
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(Address
of principal executive offices)
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(Zip
Code)
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Registrants
telephone number, including area code:
(912) 236-1561
Former name or
former address, if changed since last report
:
Not applicable
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 (See General Instruction A.2 below):
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 1.01. Entry into a Material Definitive Agreement.
On
March 25, 2009, Citi Trends, Inc. (the Company) amended its 364 day
revolving credit facility with Bank of America (the Credit Agreement) to: (i) reduce
the aggregate principal amount of availability under the revolver from $35
million to $20 million (of which $5 million will be available for the issuance
of letters of credit), (ii) extend the term until March 24, 2010, and
(iii) amend the interest rates for borrowings. The loans under the Credit Agreement are
available for short-term working capital and other general corporate purposes
of the Company. The Company has not yet
had a need to borrow under the Credit Agreement.
The
Credit Agreement is unsecured with an agreement not to pledge any of the assets
of the Company and an agreement not to provide a negative pledge to any other
party. Loans under the Credit Agreement shall bear interest at either (a) a
rate equal to the highest of (i) the Federal Funds Rate plus 0.50%, (ii) LIBOR
plus 1.0% and (iii) Bank of Americas prime rate, plus an applicable
margin; or (b) a rate equal to LIBOR plus an applicable margin. The
applicable margin is dependent on the Companys adjusted leverage ratio and
ranges from 0.75% to 1.25% for loans bearing interest at the rate described
under (a) above and from 1.75% to 2.25% for loans bearing interest at the
rate described under (b) above.
The
Credit Agreement includes customary representations, warranties, affirmative
and negative covenants and events of default (and related remedies, including
acceleration and increased interest rates following an event of default). It
also contains a financial covenant tied to the Companys adjusted leverage
ratio.
Item 2.02. Results of Operations and Financial Condition.
On
March 25, 2009, the Company issued a press release reporting its financial
results for the fourth quarter and fiscal year ended January 31, 2009 (the
Earnings Announcement). A copy of the Earnings Announcement is attached to
this Current Report on Form 8-K (Current Report) as Exhibit 99.1
and the contents of which are incorporated herein solely for purposes of this
Item 2.02 disclosure.
The
information in this Item 2.02, including the Earnings Announcement attached to
this Current Report, is being furnished and shall not be deemed filed for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended
(the Exchange Act), or otherwise subject to the liabilities of such section.
The information in this Item 2.02, including the Earnings Announcement, shall
not be incorporated by reference into any filings under the Securities Act of
1933, as amended, or the Exchange Act, except as shall be expressly set forth
by specific reference in any such filing.
Item 2.03. Creation of a Direct Financial Obligation or
an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Item 1.01
of this report is incorporated by reference in this Item 2.03.
Item. 5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
On March 19, 2009, the
Board of Directors of the Company promoted R. David Alexander Jr. to the
position of Chief Executive Officer, effective April 5, 2009. Mr. Alexander was previously appointed
as President and Chief Operating Officer of the Company on December 8,
2008. Mr. Alexander, 52, joined the
Company after a 30 year retail career that included 10 years with Family Dollar
Stores where he was Executive Vice President and Chief Operating Officer from
2000 to 2003 and President and Chief Operating Officer from 2003 to 2005. More
recently, he was Chief Executive Officer of PCA which operates photography
studios in Wal-Mart Stores, from 2005 to 2007. He spent 2008 as a consultant
with APAX Partners, a large private equity firm.
R. Edward Anderson will
retire from the position of Chief Executive Officer effective April 4,
2009, but will continue as an employee of the Company, serving as Executive
Chairman of the Board of Directors. In
connection with his position as Executive Chairman, Mr. Anderson will
receive a salary of $375,000 per year and will continue to receive the same
2
employee benefits he
received as Chief Executive Officer. Mr. Anderson
will also receive an award of $375,000 of restricted stock under the Companys
2005 Long-Term Incentive Plan to be issued on March 30, 2009. The restricted stock will vest in full on the
first anniversary of the grant date, subject to earlier vesting upon a change
in control of the Company. Mr. Anderson
will no longer be eligible for a bonus under the Companys annual cash
incentive program.
On March 19, 2009, the
Board of Directors increased the total number of directors to six, in
accordance with the Companys bylaws, and elected Mr. Alexander to serve
as a Class I director effective April 5, 2009. Mr. Alexander will not sit on any of the
audit, compensation or nominating and corporate governance committees of the
Board and is not expected to sit on any other committee at this time. Mr. Alexander will not receive
compensation for his services as a director.
In connection with his
promotion to Chief Executive Officer, Mr. Alexander will receive an award
of $125,000 of restricted stock under the Companys 2005 Long-Term Incentive
Plan to be issued on March 30, 2009. The restricted stock will vest in
four equal annual installments on the first four anniversaries of the grant
date, subject to earlier vesting upon a change in control of the Company. Mr. Alexander will otherwise continue
under the compensation arrangement disclosed in the Companys Current Report on
Form 8-K filed December 8, 2008.
On March 25, 2009, the
Company entered into a Severance Agreement (a Severance Agreement) with each
of Mr. Alexander, Mr. Anderson, Bruce D. Smith, the Companys Senior
Vice President and Chief Financial Officer, Elizabeth R. Feher, the Companys
Executive Vice President and Chief Merchandising Officer, Ivy D. Council, the
Companys Senior Vice President of Human Resources, and James A. Dunn, the
Companys Senior Vice President of Store Operations. Each Severance Agreement provides that if the
Company terminates an executives employment without Cause (as defined in the
Severance Agreement) or if the executive terminates his or her employment
within twelve months of a Change in Control (as defined in the Severance
Agreement) provided that within such period the executives job duties have
been materially diminished or compensation has been materially decreased, the
Company will provide the executive with separation payments of twelve months
base salary. (These agreements supersede similar provisions in the Employment
Agreements of Mr. Alexander, Mr. Anderson and Ms. Feher.)
On March 25, 2009, the
Company entered into an Employment Non-Compete, Non-Solicit and Confidentiality
Agreement (a Non-Compete Agreement) with each of Mr. Alexander, Mr. Anderson,
Mr. Smith, Ms. Feher, Ms. Council, and Mr. Dunn. Each Non-Compete Agreement provides that upon
a separation from the Company, the executive will not disclose confidential
information relating to the Company, will not compete with the Company or
render similar services to a competitor of the Company for a period of one
year, will not solicit any vendor or supplier of merchandise to the Company on
behalf of a competitor for a period of two years and will not recruit Company
personnel for a period of two years. (These agreements supersede the prior
Employment Non-Compete, Non-Solicit and Confidentiality Agreements of Mr. Alexander,
Mr. Smith and Ms. Feher.)
On March 25, 2009, the
Company issued a press release announcing Mr. Alexanders promotion and Mr. Andersons
retirement, which press release is attached to this report as Exhibit 99.2
and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.
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Description
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99.1
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Earnings
Release dated March 25, 2009
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99.2
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Press
Release dated March 25, 2009
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3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
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CITI
TRENDS, INC.
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Date:
March 25, 2009
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By:
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/s/
Bruce D. Smith
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Name:
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Bruce
D. Smith
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Title:
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Chief
Financial Officer
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4
Exhibit Index
Exhibit No.
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Description
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99.1
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Earnings
Release dated March 25, 2009
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99.2
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Press
Release dated March 25, 2009
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