Larry Kraus
Ollie's Bargain Outlet HoldingsAbout Larry Kraus
Larry Kraus (age 54) is Senior Vice President and Chief Information Officer of Ollie’s Bargain Outlet (OLLI). He was promoted to SVP CIO in April 2024 after serving as Vice President, CIO since joining the company in February 2017; prior roles include Vice President of Technology and Divisional VP Technical Services & Operations at The Bon‑Ton Stores, with earlier IT roles at Rite Aid and Walmart . Company performance during his tenure has been strong: FY2024 net income was $199.8 million and Adjusted EBITDA $313.1 million; the company’s 5‑year TSR rose to 210.24 vs. 215.52 for the peer group, and Q2 FY2025 net sales grew 17.5% with comps +5.0% and gross margin 39.9% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Bon‑Ton Stores | Vice President of Technology | 2008–2017 | Led technology function; sustained IT operations and systems oversight . |
| The Bon‑Ton Stores | Divisional VP, Technical Services & Operations | Pre‑2008 | Directed technical services and operations before promotion to VP Technology . |
| Rite Aid | Various IT roles | Prior to Bon‑Ton | Progressive IT responsibilities in retail pharmacy environment . |
| Walmart | Various IT roles | Prior to Bon‑Ton | Progressive IT responsibilities in large‑scale retail environment . |
Fixed Compensation
| Component | Detail |
|---|---|
| Base Salary | Not disclosed for Larry Kraus in latest proxy; his role is not among current NEOs . |
| Annual Bonus Target | 40% of base salary at Target Company EBITDA; 0% at/below minimum threshold; 80% at Maximum EBITDA threshold (Kraus Agreement) . |
Performance Compensation
| Metric | Weighting | Target | Actual | Payout | Vesting/Notes |
|---|---|---|---|---|---|
| Company EBITDA (annual incentive) | 100% | 40% of salary at Target EBITDA | FY2021 company achieved ~88% of Target Adjusted EBITDA | $19,739 paid to Kraus for FY2021 per plan (interpolated near threshold) | Annual cash; no performance stock units disclosed for Kraus. |
| Bonus curve (structure) | — | Minimum threshold: 0% | Target: 40% | Maximum: 80% of salary | Defined in Kraus Employment Agreement . |
Equity Ownership & Alignment
| Item | Value | As-of | Notes |
|---|---|---|---|
| Beneficial ownership (shares) | 27,465 | April 17, 2023 | Less than 1% of outstanding shares . |
| RSUs vested (shares; value) | 1,410; $120,866 | FY2021 | RSU vesting and realized value disclosed; no option exercises . |
| Hedging/Pledging | Prohibited | Policy effective Dec 1, 2023 | Company policy bans hedging and pledging by associates/directors . |
| Ownership guidelines | Sec.16 officers: 2x salary; other officers: 1x salary | Ongoing | Company stock ownership guidelines policy; compliance not disclosed for Kraus . |
| Recent Form 4 activity | Not available | 2024–2025 | Attempted to fetch insider transactions programmatically; access error. Analysis relies on proxy disclosures [ReadFile insider-trades SKILL.md; tool error noted]. |
Employment Terms
| Provision | Terms |
|---|---|
| Employment Agreement | August 2022 “Kraus Agreement” governs compensation and severance; eligible annual bonus based on Company EBITDA (40% target; 80% max) . |
| Severance (without Cause / Good Reason) | 12 months of base salary continuation, conditional on release; benefits continuation per agreement terms . |
| Non‑compete / Non‑solicit | Non‑competition and non‑solicitation covenants apply for one year post‑employment; confidentiality and proprietary rights covenants apply during employment and post‑termination (six months for proprietary rights) . |
| Change‑in‑Control Equity | Equity award acceleration occurs if terminated without Cause or with Good Reason within 12 months of change‑in‑control per 2015 Equity Plan . |
| Potential payouts (illustrative, FY2023) | “Good Reason”/No‑Cause severance $325,000; change‑in‑control equity acceleration $768,472; total $1,093,472 (point‑in‑time scenario) . |
| Clawback | Dodd‑Frank compliant clawback policy effective Dec 1, 2023; recovers erroneously awarded incentive comp upon restatement . |
Company Performance Context
| Metric | FY2020 | FY2021 | FY2022 | FY2023 | FY2024 |
|---|---|---|---|---|---|
| TSR – $100 initial investment | 178.60 | 84.71 | 101.75 | 141.53 | 210.24 |
| Peer Group TSR – $100 | 137.26 | 142.67 | 120.56 | 161.79 | 215.52 |
| Net Income ($000s) | 242,696 | 157,455 | 102,790 | 181,439 | 199,762 |
| Adjusted EBITDA ($000s) | 306,500 | 237,332 | 168,875 | 275,156 | 313,076 |
Additional near‑term performance (Q2 FY2025): net sales $679.6M (+17.5% y/y), comps +5.0%, gross margin 39.9%, adjusted EBITDA $93.8M (13.8% margin), guidance raised (FY2025 net sales $2.631–$2.644B; operating income $292–$298M; adjusted EPS $3.76–$3.84) .
Compensation Structure Analysis
- Pay‑for‑performance alignment: Kraus’s annual incentive is fully tied to Company EBITDA with a clear 0%/40%/80% payout curve, avoiding discretionary elements and focusing on core profitability, consistent with broader executive compensation design .
- Equity alignment: RSUs and options under the 2015 Plan vest ratably 25% per year over four years, strengthening multi‑year retention; options are struck at grant‑date market price and only have value above the strike .
- Governance safeguards: No option repricing, no 280G excise tax gross‑ups, and a formal clawback policy; hedging/pledging is prohibited, reducing misalignment risk .
Investment Implications
- Alignment: CIO incentive design is tightly linked to EBITDA and equity vesting over four years, supporting execution focus on profitability and IT enablement of growth; beneficial ownership (27,465 shares, <1%) indicates personal alignment but not controlling influence .
- Retention and selling pressure: 12‑month salary severance with one‑year non‑compete provides moderate retention protection; Form 4 visibility was not retrievable via the insider‑trades tool, so recent selling pressure cannot be assessed beyond proxy disclosures [ReadFile insider-trades SKILL.md; tool error].
- Change‑in‑control economics: Equity acceleration upon termination in connection with a transaction aligns with market norms; prior tabled amounts show meaningful equity value (e.g., $768K acceleration in FY2023 scenario), implying potential event‑driven outcomes but still double‑trigger .
- Execution risk: Company performance trends (EBITDA and margin expansion; raised outlook; unit growth) suggest the IT function under Kraus supports scaling; governance (clawback, no hedging/pledging) mitigates key red flags .