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

Date of report (Date of earliest event reported):

September 11, 2019

PARTY CITY HOLDCO INC.

(Exact name of registrant as specified in its charter)

Delaware	001-37344	46-0539758
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)
80 Grasslands Road Elmsford, New York		10523
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code: (914) 345-2020

Former name or former address, if changed since last report:    N/A

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:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01/share	PRTY	New York Stock Exchange

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.  ☐

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

On September 11, 2019, Gerald C. Rittenberg resigned as a member of the Board of Directors (the “Board”) of Party City Holdco Inc. (the “Company”) pursuant to the terms of an Amended and Restated Transition and Consulting Agreement (the “Consulting Agreement”) by and between him and the Company. There were no disagreements between Mr. Rittenberg and the Company on any matter relating to the Company’s operations, policies or practices that resulted in his resignation.

Pursuant to the Consulting Agreement, Mr. Rittenberg will continue to serve as a senior advisor to the Company, advising on certain strategic matters and providing other transitional and consulting services, in each case, as are reasonably requested by the Board through December 31, 2020 (unless the Consulting Agreement is earlier terminated in accordance with its terms). Under the Consulting Agreement, Mr. Rittenberg will continue to receive (i) a consulting fee of $40,000 per month through December 31, 2020; (ii) an annual cash retainer payment equal to the amount payable as an annual cash retainer to a member of the Board through the day prior to Company’s annual meeting of stockholders in 2021 (but in no event later than June 30, 2021) (the “Board Payment Expiration Date”); and (iii) an annual equity award grant in the same form as, and with a value and with terms substantially similar to, the annual equity awards made to members of the Board until the Board Payment Expiration Date (the “Equity Award”). Any portion of the Equity Award granted in 2020 that remains outstanding and unvested as of the end of the Board Payment Expiration Date will immediately vest at that time. If Mr. Rittenberg’s consulting services are terminated prior to December 31, 2020 by the Company without cause or by Mr. Rittenberg for good reason, subject to his execution and non-revocation of release of claims and his continued compliance with certain restrictive covenants, he will continue to receive the payments described above as if his services had not been so terminated.

On September 11, 2019, the Board of the Company elected James Conroy and John Frascotti to serve on the Board. The Board increased the size of the Board from ten to eleven members and appointed Mr. Conroy and Mr. Frascotti to fill the vacancies. Each of Mr. Conroy and Mr. Frascotti will hold office until the 2020 annual meeting of shareholders and until his respective successor is elected and qualified. The Board does not expect to appoint Mr. Conroy or Mr. Frascotti to any Board committee at this time.

Neither Mr. Conroy nor Mr. Frascotti was selected as a director pursuant to any arrangement or understanding with the Company or any other person. Each will receive compensation for his service as a member of the Board in accordance with the Company’s non-employee director compensation policy. Pursuant to this policy Mr. Conroy and Mr. Frascotti will each receive (i) an annual cash retainer of $75,000 for service as a Board member and (ii) an annual grant of restricted stock units (“RSUs”) equal to $125,000 (based on the aggregate value of the underlying shares on the date of grant), which will fully vest on the one year anniversary of the date of grant. In connection with their appointments to the Board, each of Mr. Conroy and Mr. Frascotti will receive a pro-rata annual grant of RSU’s based on the closing stock price of the Company’s common stock on the New York Stock Exchange on September 11, 2019 to reflect each of Mr. Conroy’s and Mr. Frascotti’s service from September 11, 2019 through June 4, 2020, which is the assumed date of the Company’s 2020 annual meeting of stockholders.

Since the beginning of the Company’s last fiscal year through the present, there have been no transactions with the Company, and there are currently no proposed transactions with the Company, in which the amount involved exceeds $120,000 and in which Mr. Conroy had or will have a direct or indirect material interest within the meaning of Item 404(a) of Regulation S-K.

Since the beginning of the Company’s last fiscal year through the present, the Company has been involved in the following transactions in which Mr. Frascotti could be deemed to have a direct or indirect material interest within the meaning of Item 404(a) of Regulation S-K as a result of Mr. Frascotti’s position as President and Chief Operating Officer of HASBRO, Inc: (i) The Company paid royalties to HASBRO, Inc. in an aggregate amount of $1,975,000 during such period; and (ii) the Company purchased merchandise from HASBRO, Inc. in an aggregate amount of $2,700,954 during such period.

In addition, each of Mr. Conroy and Mr. Frascotti and the Company entered into the Company’s standard indemnification agreement, the terms of which are described in the Company’s Registration Statement on Form S-1 (File No. 333-193466) (the “Registration Statement”) and a form of such agreement was filed as Exhibit 10.2 to the Registration Statement.

Item 7.01. Regulation FD Disclosure.

A copy of the Company’s press release announcing Mr. Conroy’s and Mr. Frascotti’s appointment is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibit

99.1	Press Release, dated September 11, 2019.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

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.

		Party City HOLDCO Inc.
Date: September 11, 2019	By:	/s/ Michael Correale
		Michael Correale
		Interim Chief Financial Officer

EX-99.1

Exhibit 99.1

Party City Announces Appointment of John Frascotti and Jim Conroy to its Board of Directors

ELMSFORD, N.Y. – SEPTEMBER 11, 2019 – Party City Holdco Inc. (the “Company” or “Party City”) (NYSE:PRTY), the leading vertically integrated decorated party goods company in North America, today announced the appointment of two industry veterans, John Frascotti and Jim Conroy, to its Board of Directors, effective September 11, 2019.

Mr. Frascotti is currently President, Chief Operating Officer of Hasbro, Inc., the global play and entertainment company, and has served in this role since 2017. Mr. Frascotti has over 11 years of experience with Hasbro, Inc. in various senior roles with increasing responsibility, including Chief Marketing Officer from 2008 to 2014 and President of Hasbro Brands from 2014 to 2017. During his tenure, Mr. Frascotti played a critical part in driving a digital first omni-channel approach, executing bold global transformation initiatives and in the re-invention of Hasbro’s portfolio of franchise brands. He also currently serves on the Board of Directors of Hasbro, Inc., Discovery Family Channel, Corus Entertainment, Serious Fun Children’s Network, and is a member of the Advisory Board for Newman’s Own Foundation. Previously, Mr. Frascotti held several senior executive positions at Reebok International Ltd., where he managed the Company’s largest global business segment.

Mr. Conroy has over 25 years of retail experience and is currently President, Chief Executive Officer and a Director of Boot Barn Holdings, Inc., the nation’s leading lifestyle retailer of western and work-related footwear, apparel and accessories for men, women and children. Under his leadership, Boot Barn has launched several new private brands and more than tripled its annual revenue, through organic growth and M&A. Prior to joining Boot Barn, Mr. Conroy spent five years from 2007 to 2012 at Claire’s Stores Inc., one of the world’s leading specialty retailers of fashionable jewelry and accessories, where he served as Chief Operating Officer, Interim Co-Chief Executive Officer, President, and Executive Vice President. Mr. Conroy also has extensive experience in management consulting including key retail practice leadership roles at Deloitte Consulting and Kurt Salmon Associates.

“We are pleased to welcome John and Jim to our Board and believe their backgrounds are a great addition to the broad experience of our existing Board of Directors,” said Norman Matthews, Party City Director and Chairman of the Board. “John and Jim are well-established leaders with proven track records of driving growth at consumer companies and we will leverage their valuable insights. We look forward to working with them both as we focus on executing against our growth strategies across our omni-channel business.”

Mr. Frascotti graduated from Yale University with his Bachelor’s degree in Economics, and Harvard Law School where he earned his Doctor of Law degree. Mr. Conroy received his Bachelor’s degree in Business Management and Marketing and a Master’s degree in Business Administration from Cornell University.

In conjunction with the appointment of Mr. Frascotti and Mr. Conroy, Party City today announced the resignation of Gerry Rittenberg from its Board of Directors. Mr. Rittenberg, who has been with the Company since 1990 and served as Chief Executive Officer of Party City from 1997 to 2014, will remain with the Company as a consultant through December 31, 2020.

About Party City

Party City Holdco Inc. is the leading party goods company by revenue in North America and, we believe, the largest vertically integrated supplier of decorated party goods globally by revenue. The Company is a popular one-stop shopping destination for party supplies, balloons, and costumes. In addition to being a great retail brand, the Company is a global, world-class organization that combines state-of-the-art manufacturing and sourcing operations, and sophisticated wholesale operations complemented by a multi-channel retailing strategy and e-commerce retail operations. The Company is the leading player in its category, vertically integrated and unique in its breadth and depth. Party City Holdco designs, manufactures, sources and distributes party goods, including paper and plastic tableware, metallic and latex balloons, Halloween and other costumes, accessories, novelties, gifts and stationery throughout the world. The Company’s retail operations include over 900 specialty retail party supply stores (including franchise stores) throughout North America operating under the names Party City and Halloween City, and e-commerce websites, principally through the domain name PartyCity.com.

Contacts

Investor Relations

ICR

Rachel Schacter

203-682-8200

InvestorRelations@partycity.com

Media Relations

ICR

Brittany Fraser

203-682-8200

PartyCityPR@icrinc.com

XML

Document and Entity Information	Sep. 11, 2019
Cover [Abstract]
Amendment Flag	false
Entity Central Index Key	0001592058
Document Type	8-K
Document Period End Date	Sep. 11, 2019
Entity Registrant Name	PARTY CITY HOLDCO INC.
Entity Incorporation State Country Code	DE
Entity File Number	001-37344
Entity Tax Identification Number	46-0539758
Entity Address, Address Line One	80 Grasslands Road
Entity Address, City or Town	Elmsford
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10523
City Area Code	(914)
Local Phone Number	345-2020
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common stock, par value $0.01/share
Trading Symbol	PRTY
Security Exchange Name	NYSE
Entity Emerging Growth Company	false