Carriage Services Reports Material Agreements, Officer Compensation Changes

TL;DR

**Carriage Services is shaking things up with new and terminated agreements, plus changes to executive pay.**

AI Summary

Carriage Services, Inc. filed an 8-K on February 22, 2024, reporting events from February 21, 2024. The filing indicates the entry into and termination of material definitive agreements, changes in compensatory arrangements for certain officers, and disclosures related to results of operations and financial condition. This suggests significant corporate actions and potential shifts in executive compensation and strategic direction.

Why It Matters

This filing signals significant strategic and operational changes at Carriage Services, potentially impacting its financial performance and future leadership structure.

Risk Assessment

Risk Level: medium — The entry into and termination of material definitive agreements, alongside changes in officer compensation, introduces uncertainty regarding the company's strategic direction and financial commitments.

Key Players & Entities

• Carriage Services, Inc. (company) — Registrant
• February 21, 2024 (date) — Date of earliest event reported
• February 22, 2024 (date) — Filing date
• Delaware (company) — State of incorporation
• 001-11961 (dollar_amount) — SEC File Number

FAQ

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 CSV New York Stock Exchange Indic
• $1.25 million — es "): A prorated payment of his 2024 $1.25 million annual target bonus (approximately $181
• $181,500 — lion annual target bonus (approximately $181,500), payable in a lump sum on the first pa
• $1,250,000 — Payment Date "); Payment of his 2023 $1,250,000 annual bonus (which had been previously
• $2 m — ontinuation severance payments totaling $2 million, payable on regular payroll dates
• $1 million — eat Settlement Amount "), as follows: $1 million on the Initial Payment Date; 1/24th o
• $35,000 — d by that agreement, up to a maximum of $35,000. All of the payments and benefits pro
• $83,333 — pay Mr. Payne a consulting fee equal to $83,333 per month. The Transition Agreement may

Filing Documents

• ea0200435-8k_carriage.htm (8-K) — 62KB
• ea0200435ex99-1_carriage.htm (EX-99.1) — 308KB
• ea0200435ex99-2_carriage.htm (EX-99.2) — 114KB
• ex99-1_001.jpg (GRAPHIC) — 5KB
• 0001213900-24-015900.txt ( ) — 728KB
• csv-20240221.xsd (EX-101.SCH) — 3KB
• csv-20240221_lab.xml (EX-101.LAB) — 33KB
• csv-20240221_pre.xml (EX-101.PRE) — 22KB
• ea0200435-8k_carriage_htm.xml (XML) — 4KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. The description of Melvin C. Payne's Transition Agreement provided in Item 5.02 is incorporated by reference into this Item 1.01.

02 Termination of a Material Definitive Agreement

Item 1.02 Termination of a Material Definitive Agreement. The information regarding the termination of the Employment Agreement of Melvin C. Payne set forth in Item 5.02 below is incorporated by reference into this Item 1.02.

02 Results of Operations and Financial Condition

Item 2.02 Results of Operations and Financial Condition. In a press release dated February 21, 2024 (the " February 21st Press Release "), Carriage Services, Inc. (the " Company ") announced and commented on its financial results for its year ended December 31, 2023. A copy of the February 21st Press Release issued by the Company is attached hereto as Exhibit 99.1 and incorporated by this reference. The February 21st Press Release contains non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP. Pursuant to the requirements of Regulation G, the Company has provided quantitative reconciliations within the February 21st Press Release of the non-GAAP financial measures to the most directly comparable GAAP financial measures. Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. As also described in the February 21st Press Release, on February 22, 2024 (the " Transition Date "), Melvin C. Payne, the Company's founder and former Chief Executive Officer, will cease to serve as Executive Chairman of the Board of the Company. Beginning on the Transition Date, Mr. Payne will begin serving as a special advisor to the Board of Directors of the Company (the " Board ") and senior management in a consulting role. In addition, Mr. Payne will remain on the Board until the Company's 2024 annual meeting of stockholders, when the term for the Class I directors is scheduled to expire. In connection with Mr. Payne's termination of employment, the employment-related provisions of his Employment Agreement, dated as of November 5, 2019, with the Company (

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. Completion of the Company's Strategic Review The February 21st Press Release also announced that the Board has completed the exploration of strategic alternatives that the Company publicly announced on June 29, 2023. Initiation of the Strategic Review . On June 15, 2023, following an unsolicited bid submitted confidentially by Park Lawn Corporation (" Park Lawn "), the Board initiated a strategic process to explore, review and evaluate a range of transactions and strategic alternatives, including a sale, merger or other potential strategic or financial transactions, with the goal to maximize stockholder value (the " Strategic Review "). In connection with the Strategic Review, the Board selected Lazard Frres & Co. LLC (" Lazard ") as financial advisor for the Company and engaged Sidley Austin LLP (" Sidley ") to act as special M&A counsel on behalf of the Company. 2 On June 29, 2023, the Company publicly announced that it had initiated the Strategic Review. On the same day, shortly after the Company's announcement, Park Lawn publicly announced that it had submitted an unsolicited confidential proposal to acquire the Company. Outreach to Potential Counterparties. At the direction of the Board, in mid-June 2023, Lazard began contacting potential counterparties, ultimately contacting approximately 70 potential counterparties (including Park Lawn), approximately 30 of which parties executed a confidentiality agreement and reviewed a confidential information memorandum. Participants in the Strategic Review process were invited to submit a proposal for the acquisition of 100% of the Company's common stock. Initial Indications of Interest and the Second Round. In late August 2023, the Company received three non-binding indications of interest to purchase all of the equity of the Company, consisting of two strategic potential counterparties (including Park Lawn) and one financial sponsor. In addition to the acquisition propos

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits Exhibit 99.1 Press Release, dated February 21, 2024, issued by Carriage Services, Inc. Exhibit 99.2 Transition Agreement, dated February 21, 2024 by and between Melvin C. Payne and Carriage Services, Inc. Exhibit 104. Cover Page Interactive Data File (embedded within the Inline XBRL document) 3

SIGNATURES

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. February 21, 2024 CARRIAGE SERVICES, INC. By: /s/ Steve D. Metzger Steve D. Metzger President and Secretary 4

View Full Filing

View this 8-K filing on SEC EDGAR