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In a recent filing with the Securities and Exchange Commission, Lands’ End, Inc., a family clothing retailer currently valued at $333 million, disclosed the entry into a new severance agreement with Chief Financial Officer Bernard McCracken. The agreement, effective as of Monday, March 11, 2025, updates the terms of Mr. McCracken’s potential severance package. According to InvestingPro data, the company has experienced significant stock volatility, with shares down 28% over the past six months.
Under the new terms, if Mr. McCracken is terminated without cause or resigns for good reason, he is eligible to receive a pro-rata bonus for the fiscal year, a severance payment equal to his base salary plus the average of his last two annual bonuses over 12 months, or double that sum over 24 months in the event of a company change in control. Additionally, he will be entitled to continued health insurance coverage and outplacement services for the same duration as his severance payments. The company appears well-positioned to meet these obligations, as InvestingPro data shows a healthy current ratio of 1.74, indicating sufficient liquid assets to cover short-term obligations.
The agreement also includes a non-competition clause effective during and for 12 months after employment, extendable to 24 months post-termination if related to a change in control of the company. However, Mr. McCracken has the option to waive the second year of non-competition and any remaining severance payments. He is also bound by non-solicitation, non-disparagement, and confidentiality covenants. While currently unprofitable, analysts tracked by InvestingPro project the company to return to profitability this fiscal year, with an EPS forecast of $0.42.
This executive severance agreement is detailed in an exhibit attached to Lands’ End’s Form 8-K filing and is part of the company’s ongoing executive compensation arrangements. The information provided in this article is based on the press release statement issued by the company. For comprehensive analysis of Lands’ End’s financial health, valuation metrics, and growth potential, access the full Pro Research Report available exclusively on InvestingPro.
In other recent news, Lands’ End has expanded its Board of Directors by appointing Gordon Hartogensis as a new director, increasing the board from six to seven members. This development was officially announced on January 22, 2025, with Hartogensis joining both the Compensation Committee and the Audit Committee. The company clarified that his appointment was not influenced by any prior agreements or understandings with other individuals. Hartogensis will be compensated according to Lands’ End’s existing Director Compensation Policy, which applies to all non-employee directors. No related party transactions involving Hartogensis have been reported that would necessitate disclosure under SEC regulations. This announcement was followed by the necessary filing with the Securities and Exchange Commission. The 8-K filing is a standard form used by companies to inform investors of significant events that may impact their ownership or share values. These recent developments are part of Lands’ End’s ongoing efforts to enhance its governance structure.
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