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
JULY 22, 2005 (JULY 18, 2005)
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED)
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THE GREAT ATLANTIC & PACIFIC
TEA COMPANY, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MARYLAND 1-4141 13-1890974
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
TWO PARAGON DRIVE
MONTVALE, NEW JERSEY 07645
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(201) 573-9700
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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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:
/_/ Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
/_/ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
/_/ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
/_/ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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ITEM 1.01. ENTRY INTO A MATERIAL DEFINITE AGREEMENT.
On July 18, 2005, the Board of Directors of The Great Atlantic & Pacific Tea
Company, Inc. (the "Company") approved the promotion of Mr. Eric Claus,
currently President of The Great Atlantic & Pacific Tea Company of Canada
Limited ("A&P Canada"), to the role of President and Chief Executive Officer of
the Company, effective August 15, 2005. The Company will enter into an
employment agreement with Mr. Claus, which will replace Mr. Claus' current
employment agreement with A&P Canada, made and entered into as of November 11,
2002.
Under the proposed employment agreement, Mr. Claus will serve as President and
Chief Executive Officer of the Company and will report to Christian Haub,
currently Chairman and Chief Executive Officer, who will become Executive
Chairman of the Company, effective August 15, 2005. The Company will pay Mr.
Claus a base salary of $550,000 and Mr. Claus will be eligible for a management
incentive performance-based cash bonus, where the target award is 100% of base
salary. The Company will also grant, under its 2005 Turnaround Incentive
Compensation Plan ("Plan"), 150,000 Restricted Share Units (as defined in the
Plan) to Mr. Claus.
ITEM 1.02. TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
On July 18, 2005, Mr. Brian Piwek notified the Company that he will resign,
effective July 31, 2005, from his position as President and Chief Operating
Officer of the Company, and in conjunction therewith, terminate his employment
agreement with the Company, made and entered into as of October 28, 2002, as
amended February 4, 2005 ("Employment Agreement").
Mr. Piwek will terminate his Employment Agreement for Good Reason (as defined in
the Employment Agreement), and therefore, will be entitled to receive, as
further detailed in his Employment Agreement, (i) a pro rata bonus for the
calendar year in which the termination occurred, (ii) continued insurance
coverage for a period of twenty-four (24) months, and (iii) severance for a
period of twenty-four (24) months, equal to one-twelfth of annual base salary
plus the average of the three (3) highest bonuses in the five (5) calendar years
preceding resignation. In addition, the Company will immediately vest (i) all of
Mr. Piwek's outstanding but unvested options, which will become exercisable for
a period of one (1) year from the date of his departure, and (ii) Mr. Piwek's
SERP benefits at the ten (10) year benefit level.
The foregoing description of the Employment Agreement is qualified in its
entirety by reference to the full text of the Employment Agreement, filed as
Exhibit 10.14 to the Company's Form 10-Q filed on January 10, 2003, and Exhibit
10.15 to the Company's Form 10-K filed on May 10, 2005, and such Employment
Agreement is incorporated herein by reference.
ITEM 2.02. REGULATION FD DISCLOSURE.
On July 22, 2005, the Company issued a press release announcing its financial
results for the fiscal 2005 first quarter ended June 18, 2005. A copy of the
press release is attached as Exhibit 99.1 to this Current Report.
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In accordance with General Instruction B.2 of Form 8-K, the information
furnished in this Item 2.02 shall not be deemed "filed" for purposes of Section
18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to
the liabilities of that section, nor shall such information be deemed
incorporated by reference in any filing under the Securities Act of 1933, as
amended, except as shall be expressly set forth by specific reference in such a
filing.
To supplement the consolidated financial results as determined in accordance
with generally accepted accounting principles ("GAAP"), the press release
presents non-GAAP financial measures for "EBITDA." EBITDA is defined as earnings
before interest, taxes, depreciation, amortization, minority interest,
discontinued operations and cumulative effect of change in accounting
principles. Management believes that the use of such non-GAAP financial measures
enables the Company to convey a useful and informative financial picture to
investors. The non-GAAP measure "EBITDA" reflects a measure that the Company
believes is of interest to investors. As required by the Securities and Exchange
Commission, EBITDA is reconciled to Net Cash provided by Operating Activities on
Schedule 1 of the release.
ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF PRINCIPAL OFFICERS.
The Company announced on July 20, 2005, that Mr. Brian Piwek, the Company's
President and Chief Operating Officer, will resign effective July 31, 2005. The
Company also announced on July 20, 2005, that Mr. Christian Haub, currently
Chairman and Chief Executive Officer, will become Executive Chairman of the
Company, effective August 15, 2005, and that Mr. Eric Claus, currently President
of A&P Canada, will assume the role of President and Chief Executive Officer of
the Company, effective August 15, 2005. A copy of the press release announcing
these organizational changes is attached hereto as Exhibit 99.1 and incorporated
herein by reference.
Information regarding the material terms of the employment agreement, pursuant
to which Mr. Claus will serve as President and Chief Executive Officer of the
Company, are disclosed in Item 1.01 of this Current Report.
The biographical and other information with respect to Mr. Haub and Mr. Claus
required by Item 5.02(c) of Form 8-K is contained in the Company's definitive
proxy statement on Schedule 14A filed with the Securities and Exchange
Commission on May 27, 2005, and such information is incorporated herein by
reference.
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ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit
Number Exhibit Description
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99.1 Press Release of The Great Atlantic & Pacific Tea Company, dated July
22, 2005.
99.2 Press Release, dated July 20, 2005, announcing The Great Atlantic &
Pacific Tea Company's New Executive Management Following the Sale of
Canadian Business.
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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.
Dated: July 22, 2005
THE GREAT ATLANTIC & PACIFIC TEA COMPANY,
INC.
By: /s/ Mitchell P. Goldstein
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Mitchell P. Goldstein, Executive Vice President,
Chief Financial Officer & Secretary
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INDEX TO EXHIBITS
Exhibit
Number Exhibit Description
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99.1 Press Release of The Great Atlantic & Pacific Tea Company,
dated July 22, 2005.
99.2 Press Release, dated July 20, 2005, announcing The Great
Atlantic & Pacific Tea Company's New Executive Management
Following the Sale of Canadian Business.
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