8-K

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

Kirkland's, Inc.

| (Exact name of registrant as specified in its charter) | | --- || Tennessee | 000-49885 | 62-1287151 | | --- | --- | --- | | (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | | 5310 Maryland Way, Brentwood, Tennessee | | 37027 | | (Address of principal executive offices) | | (Zip Code) || Registrant’s telephone number, including area code: | 615-872-4800 | | --- | --- || 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:

¨    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))

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

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Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On January 16, 2020, by mutual agreement between Mike Cairnes, President and Chief Operating Officer, and Kirkland’s, Inc. (the "Company”), the Company has taken action such that Mr. Cairnes position with the Company has terminated effective immediately. Subject to the execution of the Release and Non-Disparagement Agreement in the form attached to his employment agreement as Exhibit B, Mr. Cairnes will receive the severance compensation for a termination without cause as described in his employment agreement with the Company. In addition, pursuant to the terms of his October 22, 2018 Restricted Stock Unit Award Agreement, Mr. Cairnes will have 26,567 unvested restricted stock units vest as a result of his termination without cause. The Company announced that Steve “Woody” Woodward, the Company’s Chief Executive Officer, would add the role of President and would now oversee operations.

Also on January 16, 2020, the Company promoted John Stacy, currently Vice President of Supply Chain, to Senior Vice President of Supply Chain, and Jeff Martin, currently Vice President of Transformation, to Senior Vice President of Omni-Channel Retail. Mr. Stacy will continue to lead initiatives focusing on supply chain and direct sourcing, and Mr. Martin will oversee store and e-commerce operations. Mr. Stacy has been with Kirkland’s for three years and Mr. Martin joined the Company in 2019. Both have extensive experience in retail operations.

Item 7.01 Regulation FD Disclosure

As part of its strategic efforts to improve growth and profitability of the Company, on January 16, 2020, the Company issued a press release announcing plans to close 27 stores across the United States in early 2020. A copy of the Company’s press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 7.01.

This information, including Exhibit 99.1, 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 incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

The following exhibit is furnished as part of this Report:

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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.

		Exhibit

KIRKLAND’S ANNOUNCES MANAGEMENT CHANGES

AND FURTHER STEPS TO IMPROVE PROFITABILITY

NASHVILLE, Tenn. (January 16, 2020) - Kirkland's, Inc. (NASDAQ: KIRK) today announced it has mutually parted ways with President and Chief Operating Officer, Michael Cairnes. Woody Woodward, the Company’s Chief Executive Officer, will add the role of President and will oversee operations in addition to his ongoing responsibilities across merchandising and marketing.

The Company has promoted John Stacy, currently Vice President of Supply Chain, to Senior Vice President of Supply Chain, and Jeff Martin, currently Vice President of Transformation, to Senior Vice President of Omni-Channel Retail. Mr. Stacy will continue to lead initiatives focusing on supply chain and direct sourcing and Mr. Martin will oversee store and e-commerce operations. Both have extensive experience in retail operations, and each has been involved in building Kirkland’s current initiatives.

“We wish Mike well in his future endeavors and thank him for his service to Kirkland’s the past three years,” said Mr. Woodward. “I look forward to working with John, Jeff and the Kirkland’s team to achieve our financial goals and to optimize the Kirkland’s customer experience.”

Update on 2019 Holiday Performance

Mr. Woodward continued, “While the environment remains challenging for home décor retailing, our business overall remains on track with our expectations. Seasonal and e-commerce sales are driving a sequential improvement in the comp trend, and we have managed a better transition to January than in recent periods.” The Company expects to report fourth quarter sales in late February.

Further Steps to Improve Growth and Profitability

In connection with the executive changes, Kirkland’s is continuing to aggressively manage its operating and infrastructure costs. The Company has further reduced expenses at its corporate office and is planning to close 27 stores in early 2020, with the potential for further reductions in the store base later in the year as Kirkland’s moves forward with its goals to right size the store base.

“These moves reflect steps to streamline the organization and further accelerate our initiatives to transform the business to a more profitable model,” said Mr. Woodward. “As we have outlined, our plan includes efforts to improve the relevancy and quality of our merchandise assortment, to operate with greater efficiency, and to lower our cost of goods as we evolve to a true omni-channel model that reinforces Kirkland’s value heritage. We believe the initiatives included in the plan are the right path for the future of the Company and look forward to providing updates regarding our progress in our fourth quarter earnings release and conference call.”

About Kirkland’s, Inc.

Kirkland’s, Inc. was founded in 1966 and is a specialty retailer of home décor in the United States. Although originally focused in the Southeast, the Company has grown beyond that region and currently operates 432 stores in 37 states as well as an e-Commerce enabled website, www.kirklands.com.  The Company’s stores present a broad selection of distinctive merchandise, including holiday décor, framed art, furniture, ornamental wall décor, fragrance and accessories, mirrors, lamps, decorative accessories, textiles, housewares, gifts, artificial floral products, frames, clocks and outdoor living items.  The Company’s stores offer an extensive assortment of holiday merchandise during seasonal periods as well as items carried throughout the year suitable for gift-giving.  More information can be found at www.kirklands.com.

Forward-Looking Statements

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause Kirkland’s actual results to differ materially from forecasted results. Those risks and uncertainties include, among other things, the impact of store closures in 2020, the effectiveness of the Company’s marketing campaigns, risks related to changes in U.S. policy related to imported merchandise, particularly with regard to the impact of tariffs on goods imported from China and strategies undertaken to mitigate such impact, the Company’s ability to retain its senior management team, continued volatility in the price of the Company’s common stock, the competitive environment in the home décor industry in general and in Kirkland’s specific market areas, inflation, fluctuations in cost and availability of products, interruptions in supply chain and distribution systems, including our e-commerce systems and channels, the ability to control employment and other operating costs, availability of suitable retail locations and other growth opportunities, disruptions in information technology systems including the potential for security breaches of Kirkland’s or its customers’ information, seasonal fluctuations in consumer spending, and economic conditions in general. Those and other risks are more fully described in Kirkland’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K filed on March 29, 2019 and subsequent reports. Kirkland’s disclaims any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.