Pottery Barn 2014 Annual Report Download - page 156

which can be expected to result in death or can be expected to last for a continuous period of not less than
12 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be
expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a
period of not less than 3 months under an accident and health plan covering company employees.
For purposes of the employment agreement with Ms. Hayes, “good reason” is defined as, without Ms. Hayes’
consent, (i) a reduction in her base salary (except pursuant to a reduction generally applicable to senior
executives of the company), (ii) a material diminution of her authority or responsibilities, (iii) a reduction of
Ms. Hayes’ title, or (iv) Ms. Hayes ceasing to report directly to the chief executive officer. In addition, upon any
such voluntary termination for good reason, Ms. Hayes must provide written notice to the company of the
existence of one or more of the above conditions within 90 days of its initial existence and the company must be
provided with at least 30 days to remedy the condition.
The following table describes the payments and/or benefits which would have been owed by us to Ms. Hayes as
of February 1, 2015 if her employment had been terminated in various situations.
Compensation and Benefits
For Good
Reason
Involuntary
Without Cause
Change-of-
Control Death Disability
Base Salary(1) ............ $ 900,000 $ 900,000 $1,800,000 $ 900,000(2) $ 900,000(2)
Bonus Payment(3) ......... $ 800,000 $ 800,000 $1,600,000 $ 800,000(2) $ 800,000(2)
Equity Awards ............ $3,889,487(4) $3,889,487(4) $7,511,347(5) $3,889,487(4)(6) $3,889,487(4)(6)
Health Care Benefits(7) ..... $ 54,000 $ 54,000 $ 36,000 $ 54,000 $ 54,000
(1) Represents (i) 100%, or 12 months, or (ii) 200%, or 24 months, as applicable, of Ms. Hayes’ base salary as
of February 1, 2015.
(2) Will be reduced by the amount of any payments Ms. Hayes receives through company-paid insurance
policies.
(3) Represents (i) 100%, or 12 months, or (ii) 200%, or 24 months, as applicable, of the average annual bonus
received by Ms. Hayes in the 36-month period prior to February 1, 2015.
(4) Represents the sum of (i) $3,478,232 for acceleration of vesting of 44,450 restricted stock units and
(ii) $411,255 for acceleration of vesting of 11,002 shares underlying outstanding option awards. Value is
based on a stock price of $78.25, the closing price of our common stock on January 30, 2015, the last
business day of fiscal 2014.
(5) Represents the sum of (i) $6,474,796 for acceleration of vesting of 82,745 restricted stock units,
(ii) $411,255 for acceleration of vesting of 11,002 shares underlying outstanding option awards and
(iii) $625,296 for acceleration of 7,991 performance stock units. Value is based on a stock price of $78.25,
the closing price of our common stock on January 30, 2015, the last business day of fiscal 2014.
(6) Does not include any amount for the acceleration of vesting of performance stock units upon death or
disability because the acceleration of any performance stock units upon death or disability remains subject
to achievement of the performance goals, as certified by our Compensation Committee.
(7) Based on a monthly payment of $3,000 to be paid by the company for 18 months or 12 months, as
applicable, in lieu of continued employment benefits.
All Other Named Executive Officers
As described above, the other Named Executive Officers are generally not entitled to severance benefits in
connection with their termination for good reason, involuntary termination, death or disability, except that the
Named Executive Officers are eligible for the pro-rata accelerated vesting of performance stock units in the event
of death, disability and retirement, subject to the achievement of performance goals. The following table
describes the payments and/or benefits which would have been owed by us to the Named Executive Officers as
64