Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Employment Agreement with Interim Chief Executive Officer
On June 26, 2019, Bed Bath & Beyond Inc. (the “Company”) entered into an employment agreement (the “Employment Agreement”) with Mary A. Winston, who is a member of the Board of Directors of the Company (the “Board”) and became the Interim Chief Executive Officer of the Company effective as of May 12, 2019. The terms of the Employment Agreement were set by the newly constituted Compensation Committee of the Board upon advice of Arthur J. Gallagher & Co. Human Resources & Compensation Consulting Practice, the Compensation Committee’s independent compensation consultant, and were benchmarked against market practices with respect to compensation of interim chief executive officers at companies with comparable annual revenues.
The Employment Agreement provides forat-will employment without a specified term, an annual base salary equal to $1,100,000, and a grant of shares of time vesting restricted stock under the Company’s 2012 Incentive Compensation Plan equal in value to $1,900,000 based on the average of the high and lowper-share trading price of Company common stock on the date of grant (the “TVRS Award”). The TVRS Award was granted to Ms. Winston on June 28, 2019, and will vest on May 12, 2020, subject, in general, to Ms. Winston remaining in the Company’s employ on the vesting date. The Employment Agreement also provides that the TVRS Award will vest in full if, prior to the vesting date, (i) the Company terminates Ms. Winston’s employment other than for “Cause” (including a termination because the Company hires a replacement chief executive officer), (ii) a “constructive termination” of Ms. Winston’s employment occurs, or (iii) Ms. Winston’s employment is terminated due to her death or disability, in each case, subject to Ms. Winston’s execution andnon-revocation of a release of claims. “Cause” is defined in the Employment Agreement as when Ms. Winston has: (i) acted in bad faith or with dishonesty; (ii) willfully failed to follow reasonable and lawful directions of the Board; (iii) performed her duties with gross negligence; or (iv) been convicted of a felony. A “constructive termination” is defined in the Employment Agreement as the Company’s material breach of one or more terms of the Employment Agreement.
The description of the Employment Agreement in this Current Report onForm 8-K is a summary of, and is qualified in its entirety by, the terms of the Employment Agreement. A copy of the Employment Agreement is attached hereto as Exhibit 10.1 and incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
