Kathy Lockhart
About Kathy Lockhart
Kathy Lockhart is Chief Accounting Officer (CAO) at Noodles & Company, serving in this role since August 2020 after 14 years as Vice President and Controller (August 2006–July 2020). She previously held VP/Controller roles at Einstein’s, Boston Market, VICORP, and Ultimate Electronics; she is a CPA and CGMA with a BS in Business Administration and Political Science from Western Colorado State University, and is 60 years old as of March 19, 2025 . Company 2024 performance metrics tied to NEO pay were mixed: Adjusted EBITDA of $23.6M fell below threshold, same-store sales declined 1.9%, while Menu Innovation milestones achieved 80% led to cash bonus payouts at 20% of target for 2024 . The long-term equity design emphasizes pay-for-performance with RSUs and PSUs; for non-CEO NEOs, 60% of target LTI value is PSUs with three-year stock-price VWAP goals requiring ~300% stock price appreciation at target, indicating strong alignment and potential upside only with substantial value creation .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Noodles & Company | Chief Accounting Officer | Aug 2020–present | Leads accounting and reporting; continuity through leadership transitions |
| Noodles & Company | Vice President & Controller | Aug 2006–Jul 2020 | Built/maintained internal controls and reporting foundation |
| Einstein’s | Vice President & Controller | n/a | Multi-unit restaurant finance leadership |
| Boston Market | Vice President & Controller | n/a | Turnaround/operations finance exposure |
| VICORP (Village Inn/Bakers Square) | Vice President & Controller | n/a | Branded restaurant portfolio finance |
| Ultimate Electronics | Vice President & Controller | n/a | Retail finance and controls |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Various non-profit boards (sports and education) | Board member | n/a | Community engagement; governance experience |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $255,352 | $264,748 | $283,726 |
| Annual Bonus Design (2024) | Detail |
|---|---|
| Target bonus (% of base salary) | 50% |
| 2024 actual bonus paid ($) | $23,115 |
| Perquisites/benefits (policy) | Car allowance, technology allowance, relocation, certain life/disability insurance, health/wellness; 401(k) match up to 1% (25% match per 1% up to 4%) |
Performance Compensation
| 2024 Annual Cash Bonus Metrics | Weighting | Threshold | Target | Maximum | Actual | Unweighted % of Target Earned |
|---|---|---|---|---|---|---|
| Adjusted EBITDA ($M) | 50% | $33.0 | $46.4 | $55.2 | $23.6 | 0% |
| Same Store Sales (SSS) Growth | 25% | 2.0% | 4.0% | 6.0% | (1.9)% | 0% |
| Menu Innovation Milestones | 25% | n/a | Committee evaluation | n/a | 80% achieved | 80% |
| Resulting payout vs target | — | — | — | — | — | 20% of target (Company-wide NEO determination) |
| 2024 Target LTI Value Mix (Non-CEO NEO) | RSU Target (40%) | PSU Target (60%) | Total |
|---|---|---|---|
| Kathy Lockhart | $50,000 | $75,000 | $125,000 |
| 2024 Grants of Plan-Based Awards (Lockhart) | Grant Date | RSUs (#) | RSU Grant-Date Fair Value ($) | PSUs Threshold/Target/Max (#) | PSU Grant-Date Fair Value ($) | Bonus Target ($) | Bonus Maximum ($) |
|---|---|---|---|---|---|---|---|
| Annual awards | 5/15/2024 | 15,015 | $32,282 | 11,261 / 22,522 / 45,044 | $36,260 | $140,000 | $556,200 |
| LTI Vesting and Performance Structure | RSUs | PSUs (Stock Price VWAP Goals) |
|---|---|---|
| Cadence | Vest 25% annually over 4 years | 3-year performance period; VWAP goals determine payout |
| Payout grid | — | Threshold $4.50 = 50%; Target $6.50 = 100%; Max ≥$8.50 = 150% |
| Design intent | Manage share usage via notional price $3.33; strong upside only with ~300% stock appreciation at target |
| 2024 Stock Vesting Activity | Shares Acquired on Vesting (#) | Value Realized ($) |
|---|---|---|
| Kathy Lockhart | 12,963 | $23,333 |
| 2022–2024 PSU Outcomes (Company-wide framework) | Measure | Weight | Target/Actual | Payout |
|---|---|---|---|---|
| 3-year System-Wide Comp Sales Growth (CAGR) | Performance measure | 33.3% | Target 6.0% / Actual 0.7% | 0% |
| 3-year Cumulative Adjusted EBITDA ($M) | Performance measure | 33.3% | Target $173.6 / Actual $85.8 | 0% |
| 3-year Relative TSR | Performance measure | 33.3% | Target 55th percentile / Actual <25th | 0% |
Equity Ownership & Alignment
| Beneficial Ownership (as of Mar 19, 2025) | Shares Owned | Percent of Outstanding |
|---|---|---|
| Kathy Lockhart | 54,341 | <1% (out of 45,903,948 shares outstanding) |
| Outstanding Equity Awards (as of Dec 31, 2024) | Category | Count/Terms |
|---|---|---|
| Options – Exercisable (counts, strike, expiry) | 3,467 @ $18.43 exp 03/04/2025; 9,497 @ $16.70 exp 05/06/2025; 10,340 @ $10.64 exp 11/16/2025; 7,500 @ $5.80 exp 01/16/2028; 2,595 @ $12.30 exp 06/29/2028; 4,214 @ $7.88 exp 06/28/2029 | Legacy and multi-year grants |
| Unvested RSUs (counts by grant) | 1,045 (2021); 4,051 (2022); 7,367 (2023); 15,015 (2024) | 25% annual vest schedule |
| Unvested PSUs (target counts by grant) | 11,890 (2022); 14,367 (2023); 22,522 (2024) | 3-year VWAP goals with 0–150% payout |
| Ownership Policies | Requirement | Notes |
|---|---|---|
| Stock ownership guideline | 2× base salary for non-CEO NEOs | Must retain 50% of net shares until requirement met |
| Anti-hedging | Prohibits short-term trading, short sales, options, and hedging | Applies to officers and immediate family |
| Anti-pledging | Prohibits pledging Company stock | Governance safeguard |
| Clawback | Dodd-Frank compliant plus discretionary policy | Strong recovery rights |
| Deferred compensation (Excess Plan, 2024) | Individual contributions $9,464; Aggregate balance $34,474 | No Company contribution |
Employment Terms
| Contract & Role | Term/Provision | Detail |
|---|---|---|
| Employment Agreement (Additional Executive) | Start date | August 2021 |
| Compensation eligibility | Base salary, target bonus, equity grants, and standard benefits | Subject to performance goals |
| Non-compete | Duration | 6 months post-termination |
| Annual bonus (structure) | Range | 0–200% of target; weighted metrics (EBITDA, SSS, Menu Innovation) |
| Severance (non-CIC Qualifying Termination) | Cash | 12 months base salary; pro rata annual bonus based on YTD performance; lump-sum COBRA premium for 12 months |
| Change-in-control protection | Trigger | Double-trigger; pro rata target bonus; lump-sum COBRA premium |
| Governance practices | No single-trigger cash/CIC vesting; No tax gross-ups | Strong governance balance |
| Severance Economics (Assumes event on final day FY2024) | Termination Without Cause / Good Reason | CIC – Termination Without Cause / Good Reason | Death/Disability |
|---|---|---|---|
| Cash severance ($) | $210,000 | $210,000 | — |
| Bonus ($) | $56,000 | $140,000 | $56,000 |
| COBRA ($) | $12,490 | $12,490 | — |
| Equity grants ($) | $141,741 | $152,188 | $141,771 |
Investment Implications
- Alignment: LTI structure is heavily performance-based (60% PSUs for non-CEO NEOs) with three-year VWAP targets requiring ~300% stock price appreciation at target, which tightly aligns equity outcomes with shareholder returns and reduces windfall risk under modest performance scenarios .
- Cash/Severance risk: For Lockhart, severance is modest (12 months base, pro rata bonus, 12 months COBRA) with double-trigger CIC protection and no tax gross-ups, limiting cash leakage in change-of-control and signaling shareholder-friendly governance .
- Ownership and selling pressure: Beneficial ownership is small (<1%), but stock ownership guidelines (2× salary and 50% net share retention until compliant) plus anti-hedging/anti-pledging policies mitigate near-term selling pressure and enhance alignment despite limited absolute holdings .
- Execution/Performance risk: 2024 annual bonus paid at 20% of target and 2022–2024 PSUs paid 0% across all metrics (SSS, EBITDA, Relative TSR), indicating recent underperformance; management’s menu innovation drive is embedded in incentive design, but payout history underscores execution risk .
- Option expirations: Multiple legacy options with near-term expiries in 2025 (strikes $10.64–$18.43) could expire unexercised if share price remains below strikes, adding no incremental selling pressure but highlighting limited realizable value from older grants under current performance trends .
SAY-ON-PAY CONTEXT: Shareholders approved NEO compensation with 97% support in 2024, suggesting broad investor acceptance of the program’s pay-for-performance design .