Bed, Bath and Beyond 2015 Annual Report Download - page 50

PROPOSAL 3—APPROVAL, BY NON-BINDING VOTE, OF 2015 EXECUTIVE COMPENSATION
provide that, following a termination without cause or a constructive termination, in each case, occurring on a change in control
of the Company (as defined in the agreements) or within two years following a change in control, each of the executives shall
be paid an amount equal to three times salary then in effect, if the written notice is given before the Senior Status Period, or, if
during the Senior Status Period, one half of Senior Status Salary for the number of years (including fractions), if any, remaining
in the Senior Status Period, payable over such applicable period in accordance with normal payroll practices. The agreements
provide that in the event any amounts paid or provided to the executive in connection with a change in control are determined
to constitute “excess parachute payments” under Section 280G of the Code which would be subject to the excise tax imposed
by Section 4999 of the Code, the payments and benefits due to the executive will be reduced if the reduction would result in a
greater amount payable to the executive after taking into account the excise tax imposed by Section 4999 of the Code. The
agreements also provide that upon a change in control of the Company, the Company will fund a “rabbi trust” for each of the
executives to hold an amount equal to the value of the payments and certain benefits payable to each of the executives upon
his termination of employment with the Company. In the event of termination of employment, the executives are under no
obligation to seek other employment and there is no reduction in the amount payable to the executive on account of any
compensation earned from any subsequent employment. In the event of termination due to death of either of the executives,
the executive’s estate or beneficiary shall be entitled to his salary for a period of one year following his death and payment of
expenses incurred by the executive and not yet reimbursed at the time of death. In the event of termination due to the inability
to substantially perform his duties and responsibilities for a period of 180 consecutive days, the executive shall be entitled to
his salary for a period of one year following the date of termination (less any amounts received under the Company’s benefit
plans as a result of such disability). To the extent that any payments under the employment agreements due following the
termination of Messrs. Eisenberg and Feinstein are considered to be deferred compensation under Section 409A, such
amounts will commence to be paid on the earlier of the six-month anniversary of termination of employment or the executive’s
death.
Either of the executives may be terminated for cause upon written notice of the Company’s intention to terminate his
employment for cause, such notice to state in detail the particular act or acts or failure or failures to act that constitute the
grounds on which the proposed termination for cause is based. The executives shall have ten days after such notice is given
to cure such conduct, to the extent a cure is possible. “Cause” generally means (i) the executive is convicted of a felony
involving moral turpitude or (ii) the executive is guilty of willful gross neglect or willful gross misconduct in carrying out his
duties under the agreement, resulting, in either case, in material economic harm to the Company, unless the executive
believed in good faith that such act or non act was in the best interests of the Company. “Constructive termination” generally
means the executive’s election to terminate employment due to (i) a reduction in the executive’s salary or a material reduction
in the executive’s benefits or perquisites (other than as part of any across-the-board action applicable to all executive officers
of the Company), (ii) removal from, or failure to reelect the executive to, the position of co-chairman or chairman or as a
director, (iii) a material diminution in the executive’s duties or the assignment of duties materially inconsistent with the
executive’s duties or that materially impairs the executive’s ability to function as the co-chairman or chairman or (iv) the
Company’s principal office or the executive’s own office location provided by the Company is relocated and, in any case, not
timely cured by the Company. In addition, pursuant to their respective restricted stock and performance stock unit agreements,
shares of restricted stock and performance stock units granted to Messrs. Eisenberg and Feinstein will vest upon death or
disability, or upon a termination of employment without cause or constructive termination, subject to attainment of any
applicable performance goals.
In substitution for a split dollar insurance benefit previously provided to such executives, in fiscal 2003, the Company entered
into deferred compensation agreements with Messrs. Eisenberg and Feinstein under which the Company is obligated to pay
Messrs. Eisenberg and Feinstein $2,125,000 and $2,080,000, respectively, in each case payable only on the last day of the
first full fiscal year of the Company in which the total compensation of Mr. Eisenberg or Feinstein, as applicable, will not result
in the loss of a deduction for such payment pursuant to applicable federal income tax law.
Messrs. Temares, Stark, Castagna and Fiorilli and Ms. Lattmann
The agreements with Messrs. Temares, Stark and Fiorilli provide for severance pay equal to three years’ salary, and the
agreements with Mr. Castagna and Ms. Lattmann provide for severance pay equal to one year’s salary, if the Company
terminates their employment other than for “cause” (including by reason of death or disability). Additionally, the agreements
with Messrs. Temares, Stark, Castagna and Fiorilli provide for one year’s severance pay if the executive voluntarily leaves the
employ of the Company. Severance pay will be paid in accordance with normal payroll; however, other than for Ms. Lattmann,
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
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