Market Overview

Destination Maternity Enters into New Employment Agreement with CEO


Destination Maternity Corporation (NASDAQ:DEST) (the "Company")
announced today that the Company and Chief Executive Officer Marla Ryan
have entered into a new Employment Agreement dated November 1, 2018.

The Company's Independent Chair of the Board of Directors,
Anne-Charlotte Windal, said, "Since May 2018 the Board has undertaken a
comprehensive review of Destination Maternity's corporate compensation
and benefits program, with the goal of establishing a stronger link
between pay and performance. For Marla, as our Chief Executive Officer,
we sought to establish annual and long-term incentives that are strongly
aligned to shareholder value creation. Marla has already made
significant progress as CEO towards improving the strategic direction
and long-term outlook of Destination Maternity. We look forward to her
continuing to execute against our turnaround plan, Destination ->
, as we return the Company to its historic success and
profitability, providing innovative solutions to our new moms and
moms2be at the busiest and most joyful times of their lives."

Ms. Ryan's Employment Agreement includes the following material terms:

Employment Terms and Salary: The
initial term of the Employment Agreement is for three years, commencing
on November 1, 2018 with an initial base salary of $350,000 to be
reviewed annually by the Compensation Committee of the Board. The
Employment Agreement will automatically renew for successive one-year
terms upon expiration unless the Company or Ms. Ryan give notice of
non-renewal at least ninety days prior to the applicable expiration date.

Incentive Compensation: Ms. Ryan
shall be eligible to receive a cash incentive bonus, calculated as a
percentage of the Company's adjusted EBITDA, in each calendar year as
follows: (a) if estimated adjusted EBITDA level is less than
or equal to the Company's previous year's actual adjusted EBITDA, 1.2%
of the difference between estimated adjusted EBITDA and $0; (b) if
estimated adjusted EBITDA level is above last year's actual adjusted
EBITDA and below budgeted adjusted EBITDA, 1.2% of previous calendar
year's adjusted EBITDA plus 3.5% of the difference of estimated adjusted
EBITDA and last year's actual adjusted EBITDA; and (c) if estimated
adjusted EBITDA level is above budgeted adjusted EBITDA, 1.2% of
previous calendar year's adjusted EBITDA plus 3.5% of the difference of
budgeted adjusted EBITDA and the previous calendar year's adjusted
EBITDA plus 7.0% of the difference of estimated adjusted EBITDA and
budgeted adjusted EBITDA. Ms. Ryan's fiscal year 2018 bonus opportunity
will be based on adjusted EBITDA commencing with the second quarter
through the end of the fourth quarter of the Company's 2018 calendar
year and pro-rated from May 29, 2018.

Equity Awards: Subject to approval
by the Committee and the Board, Ms. Ryan shall be entitled to receive a
one-time equity grant with a grant date fair value of $600,000, and a
one-time equity grant for fiscal year 2018 with a grant date fair value
of $200,000 (together, the "2018 LTIP"), calculated as of the grants
date. The 2018 LTIP shall be collectively allocated as follows: (i) 20%
in restricted stock units, vesting in four equal annual increments
beginning on the first anniversary of the effective date of the
Employment Agreement, (ii) 50% in restricted stock units that vest based
on the attainment of certain performance goals; and (iii) 30% in stock
options to purchase common stock in the Company, vesting in four equal
annual increments beginning on the first anniversary of the effective
date of the Employment Agreement. The 2018 LTIP will be subject to the
terms of the forms of Restricted Stock Unit Agreement, Performance
Restricted Stock Unit Agreement and Option Agreement and the Company's
2005 Equity Incentive Plan, as amended and restated (the "Plan"). For
future fiscal years in the Term, Executive will be eligible for grants
of equity under the Plan in an amount and on the terms as decided by the
Committee in its sole discretion.

Additional details on Ms. Ryan's full employment agreement can be found
in the Company's current report on Form 8-K filed today.

Forward-Looking Statements

The Company cautions that any forward-looking statements (as such term
is defined in the Private Securities Litigation Reform Act of 1995)
contained in this release or made from time to time by management of the
Company, including those regarding various business and financing
initiatives, involve risks and uncertainties, and are subject to change
based on various important factors. The following factors, among others,
could cause actual results to differ materially from those expressed or
implied in any of the forward-looking statements in this press release:
the strength or weakness of the retail industry in general and of
apparel purchases in particular; our ability to successfully manage our
various business initiatives; our ability to enter into definitive
documentation for the refinancing facility with Bank of America in the
timeframe expected or at all; our ability to successfully manage our
real estate relationships; overall economic conditions and other factors
affecting consumer confidence, demographics and other macroeconomic
factors that may impact the level of spending for apparel (such as
fluctuations in pregnancy rates and birth rates), availability of
suitable store locations, our ability to develop and source merchandise
and other factors set forth in the Company's periodic filings with the
Securities and Exchange Commission. Although it is believed that the
expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will prove
to have been correct and persons reading this release are therefore
cautioned not to place undue reliance on these forward-looking
statements which speak only as at the date of this release. The Company
assumes no obligation to update or revise the information contained in
this release (whether as a result of new information, future events or
otherwise), except as required by applicable law.

About Destination Maternity

Destination Maternity Corporation (NASDAQ:DEST) is the world's largest
designer and retailer of maternity apparel. As of August 4, 2018,
Destination Maternity operates 1,114 retail locations in the United
States, Canada and Puerto Rico, including 480 stores, predominantly
under the trade names Motherhood Maternity®, A Pea in the Pod® and
Destination Maternity®, and 634 leased department locations. The Company
also sells merchandise on the web primarily through its brand-specific
websites, and, as well as through its website. Destination Maternity has
international store franchise and product supply relationships in the
Middle East, South Korea, Mexico, Israel and India. As of August 4,
2018, Destination Maternity has 188 international franchised locations,
including 11 standalone stores operated under one of the Company's
nameplates and 177 shop-in-shop locations.

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