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
September
13, 2007
(Date
of Report, date of earliest event reported)
Stage
Stores,
Inc.
(Exact
name of registrant as specified in its charter)
1-14035
(Commission
File Number)
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NEVADA
(State
or other jurisdiction of incorporation)
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91-1826900
(I.R.S.
Employer Identification No.)
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10201
Main Street, Houston, Texas
(Address
of principal executive offices)
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77025
(Zip
Code)
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(800)
579-2302
(Registrant's
telephone number, including area code)
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:
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Written
communications pursuant
to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to
rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications
pursuant to Rule 14d-12 under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment
of
Certain Officers; Compensatory Arrangements of Certain
Officers
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(b)
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Retirement
of Principal Financial
Officer
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On
September 13, 2007, and as part of
the planned executive officer succession process of Stage Stores, Inc. (the
“Company”), Michael E. McCreery, who has been the Company’s Chief Financial
Officer since February, 2001, retired as Chief Financial Officer. He
will remain as an Executive Vice President during a transition period, which
the
Company expects will be completed during 2008. Thereafter, Mr.
McCreery will continue to be available to the Company as needed.
Mr.
McCreery will remain a Director of
the Company and has assumed the position of Vice Chairman of the
Board.
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(c)
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Appointment
of Principal Financial
Officer
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On
September 13, 2007, and as part of the Company’s planned executive officer
succession process, the Company entered into an Employment Agreement with Edward
J. Record, who will serve as Executive Vice President, Chief Financial
Officer. During a transition period, which the Company
expects will be completed in 2008, Mr. Record will report
to Michael McCreery. Following the transition period, Mr. Record will
report to Andrew Hall, the Company's President and Chief Operating
Officer.
Mr.
Record is 39 years old. Since May of 2007, he has served as Executive Vice
President, Chief Administrative Officer of the Company. From October
of 2005 until May of 2007, he served as Senior Vice President of Finance of
Kohl’s Corporation. From June of 2002 until October of 2005, Mr. Record served
as Senior Vice President of Finance, Controller of Belk, Inc. From 1998 until
June of 2002, Mr. Record was Vice President of Finance, Controller of Kaufmann’s
and Filenes/Kaufmann (The May Company), where he reported to Mr.
Hall.
Among
others, Mr. Record’s Employment
Agreement with the Company contains the following provisions:
1.
Term. The initial term of the Employment Agreement is
thirty-six (36) months (the "Initial Term"). Upon the expiration of the Initial
Term or any Renewal Period (as hereafter described), the term of Mr. Record's
employment will automatically be extended for an additional twelve (12) month
period (a "Renewal Period"), unless either the Company or Mr. Record notifies
the other party in writing at least thirty (30) days prior to the expiration
of
the Initial Term or the then current Renewal Period that the Employment
Agreement will not be extended upon its expiration.
2.
Base Salary. Mr. Record will receive a base salary of $460,000
per year, or such other rate as the Company's Board of Directors (the "Board")
may designate from time to time (the "Base Salary"). Mr. Record's performance
will be evaluated annually, generally in March. Any future salary increases
will
be based on his individual performance and will be approved by the Board in
its
sole discretion. In consideration for his decision to accept
employment with the Company, he received a lump sum payment of $50,000; however,
he must remain employed until May 14, 2008 in order to retain this
payment.
3.
Performance Bonus. Mr. Record will be eligible for an annual performance
bonus award. His current annual bonus target is 65% of the Base
Salary and his maximum bonus amount will be 130% of the Base Salary. The
award of any bonus will be based upon financial earning parameters which will
be
determined by the Board in its sole discretion.
4.
Medical, Dental and Other Benefits. Mr. Record is eligible to enroll and
participate in any and all benefit plans the Company provides to its executive
officers and employees.
5. Automobile
Allowance. The Company will provide Mr. Record with an automobile
allowance in the amount of $1,000 per month to be allocated in his discretion,
or such other amounts designated by the Board in its sole
discretion.
6. Financial
Planning Allowance. The Company will reimburse Mr. Record for any
expenses incurred by him in connection with the preparation of taxes, estate
planning or financial counseling up to a maximum of $7,500 per year, or such
other annual amount designated by the Board in its sole discretion.
7.
Severance Benefits. Mr. Record is entitled to certain
severance benefits as set forth in the Employment Agreement in the event that
he
resigns for good reason or the Company terminates his employment without good
cause. Upon termination, he will be entitled to receive: (i) any Base
Salary earned and unpaid, and fringe benefits described in the Employment
Agreement accrued and unpaid, through the date of the termination; (ii) one
and one-half (1½) times the aggregate of: (x) his Base Salary plus
(y) his annual bonus target amount (currently 65% of Base Salary); and
(iii) any performance bonus (currently 65% of Base Salary) for the fiscal
year in which the termination occurs pro-rated through the date of the
termination; provided, however, Mr. Record will not receive any portion of
the
performance bonus unless the Board determines in good faith that he would have
been entitled to receive any performance bonus for the fiscal year in which
the
termination occurred. These severance payments will be paid in a lump
sum.
8.
Change in Control. In the event a change in control occurs and during the
period beginning three (3) months before the change in control and ending
twenty-four (24) months after the change in control: (i) the Employment
Agreement is terminated by the Company or its successor without good cause;
or
(ii) the Employment Agreement is terminated by Mr. Record with good reason,
Mr.
Record will be entitled to receive, and Company or its successor will be
obligated to pay: (i) any Base Salary earned and unpaid, and fringe benefits
accrued and unpaid, through the date of the change in control or termination;
(ii) three (3) times the aggregate of (x) his Base Salary plus (y) his annual
bonus target (currently 65% of Base Salary); (iii) any performance bonus
(currently 65% of Base Salary) for the fiscal year in which the change in
control or termination occurs pro-rated through the date of the change in
control or termination; provided, however, Mr. Record will not receive any
portion of the performance bonus unless the Board determines in good faith
that
he would have been entitled to receive any performance bonus for the fiscal
year
in which the change in control or termination occurred. Change in control
payments will be paid in a lump sum.
9.
Gross-Up Payments. As set forth in the Employment Agreement,
under certain circumstances the Company may be required to make a "gross-up"
payment to Mr. Record in the event that the amounts payable to Mr. Record under
the Employment Agreement, including termination and change in control payments,
are subject to certain taxes.
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(e)
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Initial
Equity Grants
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On
the first day of his employment as
Executive Vice President, Chief Administrative Officer (May 14, 2007) and as
previously reported on Form 3 filed May 21, 2007, Mr. Record was granted the
following equity awards under the Company’s Amended and Restated 2001 Equity
Incentive Plan on May 14, 2007:
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·
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A
stock appreciation rights ("SARs") grant of 100,000 shares of the
Company’s common stock, with a grant price equal to the closing price on
May 14, 2007 ($19.96). The SARs will vest at the rate of 25%
per year on each of the first four anniversary dates from the date
of
grant. They will expire on the earlier of (i) sixty days after
termination of employment, or (ii) seven years from the date of
grant.
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·
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A
restricted share grant of 30,000 shares of the Company’s common
stock. The restricted shares will vest over three years as
follows: 10,000 shares on May 14, 2008, 10,000 shares on May 14,
2009, and
10,000 shares on May 14, 2010.
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On
September 13, 2007, the Company issued a News Release announcing the promotion
of Mr. Record to the position of Executive Vice President, Chief Financial
Officer and Mr. McCreery’s assumption of the position of Vice Chairman of the
Board. A copy of the News Release is attached to this Form 8-K as Exhibit
99.
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Item
9.01
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Financial
Statements and Exhibits
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(d) Exhibits
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99
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News
Release issued by Stage Stores, Inc. on September 13, 2007, announcing
the
promotion of Edward Record to the position of Executive Vice President,
Chief Financial Officer and Mr. McCreery’s assumption of the position of
Vice Chairman of the Board.
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SIGNATURES
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, hereunto
duly authorized.
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STAGE
STORES, INC.
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September
13, 2007
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/s/
Michael E. McCreery
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(Date)
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Michael
E. McCreery,
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Executive
Vice President
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