TEMPUR SEALY INTERNATIONAL, INC. (NYSE:TPX) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02 below, this Amendment does not modify or update any other disclosure contained in the Original Filing.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As previously reported in the Original Filing, on September25, 2017, the Company appointed Bhaskar Rao to the position of Executive Vice President and Chief Financial Officer effective October13, 2017. On October13, 2017, the Company and Mr.Rao entered into an Employment and Non-Competition Agreement (the “Employment Agreement”), the form of which was approved by the Compensation Committee of the Company’s Board of Directors. to the Employment Agreement, the Company agreed to provide Mr. Rao with the following compensation and benefit items:
|
An annual base salary of $430,000; |
|
Eligibility to earn an annual performance-based bonus based on performance criteria approved by the Company’s Board of Directors or its Compensation Committee; |
|
A grant of 11,969 restricted stock units (“RSUs”) to acquire shares of the Company’s common stock, par value $0.01 per share, with the RSUs vesting over four years and the total shares of Common Stock subject to the RSUs having a fair market value on the date of grant of $750,000; |
|
A grant of performance restricted stock units (“2017 Project 650 PRSUs”) for 50,000 shares of the Company’s common stock, with the performance goals and other terms and conditions for these 2017 Project 650 PRSUs the same as the 2017 Project 650 Award Agreements disclosed by the Company in its Current Report on Form 8-K filed on August 7, 2017; |
|
Eligibility for future equity awards; and |
|
Certain other customary benefits commensurate with his position and role at the Company. |
The Company also determined that, in light of his promotion and increase in salary, (i)the amount of Mr. Rao’s target bonus for 2017 with respect to the period up to October13, 2017 would be based on 50% of his base salary paid with respect to the period from January1, 2017 to October13, 2017 and (ii)the amount of Mr. Rao’s target bonus for 2017 with respect to the period from October13, 2017 through December31, 2017 would be based on 70% of his base salary paid with respect to such period.
to the terms of the Employment Agreement, the Company may terminate Mr. Rao’s employment at any time and for any reason. If the Company terminates Mr. Rao’s employment “For Cause” (as defined in the Employment Agreement), or Mr. Rao terminates his employment but not for “Good Reason,” he will be entitled to receive (i) any unpaid base salary and (ii) reimbursement of certain expenses to which he may be entitled under the terms of the Employment Agreement. If Mr. Rao’s employment is terminated due to his death or disability, he or his estate will be entitled to receive (i)any unpaid base salary, (ii)the value of any
accrued but unused vacation, (iii)a pro-rata portion of any performance bonus that would be payable with respect to the year in which the termination occurs and (iv)reimbursement of certain expenses to which he may be entitled under the terms of the Employment Agreement. If the Company terminates Mr. Rao’s employment but not “For Cause” or Mr. Rao terminates his employment with the Company for “Good Reason,” then Mr. Rao will be entitled to receive (i)any unpaid base salary, (ii)the value of any accrued but unused vacation, (iii)a pro-rata portion of the target performance bonus with respect to the year in which the termination occurs, (iv)payment of his base salary for twelve months after the termination occurs, (v)reimbursement of certain expenses to which he may be entitled under the terms of the Employment Agreement and (vi)certain health insurance benefits. Certain of the compensation and benefit items to which Mr. Rao may be entitled upon the termination of his employment with the Company are subject to Mr. Rao’s execution of a release and waiver in a form satisfactory to the Company. In addition, depending upon the circumstances of the termination of his employment with the Company, Mr. Rao may also be entitled to receive certain equity awards and/or exercise certain stock options to the terms of the various award agreements under which such equity awards were granted.
The Employment Agreement also contains confidentiality, non-competition, non-solicitation and other standard provisions.
About TEMPUR SEALY INTERNATIONAL, INC. (NYSE:TPX)
Tempur Sealy International, Inc. is a bedding provider. The Company develops, manufactures, markets and distributes bedding products. It operates in two segments: North America, which consists of Tempur and Sealy manufacturing and distribution subsidiaries, joint ventures and licensees located in the United States and Canada, and International, which consists of Tempur and Sealy manufacturing and distribution subsidiaries, joint ventures and licensees located in Europe, Asia-Pacific and Latin America. Its brands include TEMPUR, Tempur-Pedic, Sealy, Sealy Posturepedic, Optimum and Stearns & Foster. It sells products through over two distribution channels in each segment: retail (furniture and bedding retailers, department stores, specialty retailers and warehouse clubs), and other (direct-to-consumer through e-commerce platforms, company-owned stores and call centers, third-party distributors, hospitality and healthcare customers).