Bed, Bath and Beyond 2014 Annual Report Download - page 67

any amount due prior to the six months after termination of employment will be paid in a lump sum on the date following
the six month anniversary of termination of employment. Any severance payable to these executives will be reduced by any
monetary compensation earned by them as a result of their employment by another employer or otherwise. ‘‘Cause’’ is
defined in the agreements as when the executive has: (i) acted in bad faith or with dishonesty; (ii) willfully failed to follow
reasonable and lawful directions of the Company’s Chief Executive Officer or the Board of Directors, as applicable;
(iii) performed his or her duties with gross negligence; or (iv) been convicted of a felony. Upon a termination of employment
by the Company for any reason other than for cause, all unvested options will vest and become exercisable. In addition,
pursuant to their respective restricted stock and performance stock agreements, or, in the case of Ms. Lattmann, her
employment agreement, shares of restricted stock and performance stock units granted will vest upon death or disability, or
upon a termination of employment without cause subject to attainment of any applicable performance goals (except that any
restricted stock granted before 2009 will vest upon a termination without cause without regard to the attainment of
performance goals). These agreements also provide for non-competition and non-solicitation during the term of employment
and for one year thereafter (two years in the case of Mr. Castagna and Ms. Lattmann), and confidentiality during the term of
employment and surviving the end of the term of employment.
Mr. Temares has a supplemental executive retirement benefit agreement and a related escrow agreement, under which he is
entitled to receive a supplemental retirement benefit on his retirement or other separation from service from the Company.
The retirement benefit will be payable in the form of a lump sum equal to the present value of an annual amount equal to
50% of Mr. Temares’ annual base salary on the date of termination of employment if such annual amount were paid for a
period of 10 years in accordance with the Company’s normal payroll practices. Except in the case of Mr. Temares’ death (in
which case the supplemental retirement benefit will be immediately payable) and the agreement as to escrow, the
supplemental retirement benefit will be paid on the first business day following the six month anniversary of Mr. Temares’
termination and will be includible in his income for tax purposes at such time.
In the event Mr. Temares elects to retire or voluntarily terminates his employment with the Company, a portion of the
supplemental retirement benefit, net of withholdings, will be deposited into an escrow account governed by a separate
agreement. No portion of the supplemental retirement benefit will be deposited into the escrow account, however, in the
event Mr. Temares dies, is terminated by the Company without cause (as such term is defined in his employment agreement),
terminates due to disability, or terminates employment within 12 months following a change of control. In the event
Mr. Temares elects to retire or voluntarily terminates his employment with the Company,
1
⁄ 10 of the lump sum supplemental
retirement benefit distribution (net of applicable withholding taxes) will be distributed to Mr. Temares; and
9
⁄ 10 of the lump
sum supplemental retirement benefit distribution (net of applicable withholding taxes) will be deposited into an escrow
account to be distributed in nine equal annual installments on each of the following nine anniversaries of the deposit date,
subject to acceleration in the case of Mr. Temares’ death or a change of control of the Company. The entire escrow account
will be distributed to Mr. Temares’ beneficiary no later than 30 days following his death or to Mr. Temares no later than
30 days following a change of control of the Company. If Mr. Temares does not comply with the restrictive covenant not to
compete with the Company (as described in his employment agreement, for the term of the escrow agreement) prior to the
payment of the entire escrow amount, the Company will have the right to direct the escrow agent to pay the remaining
escrow amount to the Company no later than 15 days after notice to the escrow agent and Mr. Temares will forfeit any and all
rights to such remaining escrow amount. Mr. Temares has agreed that in the event any amount in escrow is forfeited, he will
use commercially reasonable efforts to obtain a refund of applicable taxes and remit such refund to the Company and the
Company has agreed to reimburse Mr. Temares, or to pay on his behalf, reasonable legal fees and expenses incurred in
connection with such a refund request. Although the amended SERP provides that Mr. Temares will be protected from any
impact resulting from the possible application of Section 409A to the terms of the SERP due to the complexities surrounding
Section 409A, the Company believes that no such payment will be required.
Table and related footnotes follow:
BED BATH & BEYOND PROXY STATEMENT
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