SHOE CARNIVAL INC 8-K

What Happened

• Shoe Carnival, Inc. announced that Clifton E. Sifford is serving as Interim President and Chief Executive Officer effective February 24, 2026 while continuing as Executive Vice Chairman. The Compensation Committee approved his pay: $1,000,000 annual base salary (effective Feb 24, 2026), a monthly stipend of $2,957, a $1,100 monthly automobile allowance, eligibility for the company’s Executive Incentive Compensation Plan (EICP) and other benefits, and a one-time grant of 112,220 service-based restricted stock units (RSUs) that cliff-vest on March 31, 2027 subject to continued service. A March 5, 2026 letter agreement with non‑competition, non‑solicit and non‑disparagement covenants (and 12-month post‑employment restrictions) memorializes these terms.
• The Compensation Committee also set fiscal 2026 performance targets under the EICP using Operating Income before Nonrecurring Items (“Adjusted Operating Income”) and granted RSUs and performance stock units (PSUs) to other senior executives. Key equity grants include: W. Kerry Jackson — 21,060 PSUs and 14,040 RSUs; Marc A. Chilton — 27,048 PSUs and 18,032 RSUs; Tanya E. Gordon — 20,160 PSUs and 13,440 RSUs; Patrick C. Edwards — 4,875 PSUs and 7,313 RSUs. PSUs vest in full March 31, 2029 (subject to performance and service); executive RSUs vest 50% on March 31, 2028 and 50% on March 31, 2029.

Key Details

• Clifton E. Sifford compensation: $1,000,000 base salary (annual), $2,957 monthly stipend, $1,100 monthly auto allowance, plus 112,220 RSUs (cliff vest 3/31/2027).
• Fiscal 2026 EICP payout scale (based on Adjusted Operating Income): threshold = 25% of target for Sifford (others vary); target = 100% of target for Sifford; maximum = 175% of target for Sifford. (Other named officers have lower percentage bands; Patrick Edwards: 10%/40%/60% at threshold/target/maximum.)
• Equity grants: PSUs subject to adjusted net income per diluted share goals (25%–175% payout range with interpolation; below threshold = 0%); service RSUs vest over 2028–2029 for most officers.
• EICP amendments: add a definition for Operating Income before Nonrecurring Items, give the Compensation Committee authority to adjust Business Criteria to exclude unanticipated material transactions/events, and extend the plan term five fiscal years.

Why It Matters

• This filing documents a leadership transition and the company’s plan to retain and incentivize executives through cash and significant equity awards tied to Adjusted Operating Income. For investors, the changes may increase near-term compensation expense and create future share-based dilution if RSUs/PSUs vest and settle. The EICP amendments give the Compensation Committee discretion to adjust performance measures for certain transactions, which affects how payouts will be calculated and should be watched when evaluating future executive compensation and its linkage to reported operating results.