Employment Agreement

Addendum to Employment Agreement

2010 Addendum to Employment Agreement

Change in Control Agreement

Amendment to Change in Control Agreement

Amendment 2 to Change in Control Agreement

 

 

EX-10.16 3 dex1016.htm EMPLOYMENT AGREEMENT, DATED AS OF FEBRUARY 1,2009 WITH LAURA J. SEN

Exhibit 10.16

Laura J. Sen

EMPLOYMENT AGREEMENT

AGREEMENT dated as of the 1st day of February, 2009 between Laura J. Sen, whose address is 90 Babcock Street, Brookline, Massachusetts 02446 (“Executive”), and BJ’ s Wholesale Club, Inc., a Delaware corporation, whose principal office is One Mercer Road, Natick, Massachusetts (“Employer” or “Company”).

WITNESSETH

WHEREAS, the Company desires to employ the Executive, and the Executive desires to be employed by the Company;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the sufficiency of which is acknowledged by each party, and intending to be legally bound hereby, the Company and the Executive agree as follows:

1. Employment and Duties.

1.1 Employment. Commencing on February 1, 2009 (the “Effective Date”), the Company agrees to employ the Executive and the Executive agrees to be employed by the Company. The Executive shall remain employed by the Company pursuant to the terms of this Agreement subject to the termination provisions of Section 3 below.

1.2 Duties. As of the Effective Date, the Executive shall serve the Company as its President and Chief Executive Officer to serve in such capacity or other capacities as designated by the Board of Directors from time to time. During the term of this Agreement, the Executive shall serve the Company faithfully, diligently and to the best of her ability and shall devote substantially all of her business time, energy and skill to the affairs of the Company as necessary to perform the duties of her position, and she shall not assume a position in any other business without the express written permission of the Chairman of the Board of Directors (“the Chairman”); provided that the Executive may upon disclosure to the Chairman (i) serve in any capacity with charitable or not-for-profit enterprises so long as there is no material interference with the Executive’s duties to the Company and (ii) the Executive does not make any passive investments where the Executive is not obligated or required to, and shall not in fact, devote any managerial efforts. The Company shall have the right to limit the Executive’s participation in any of the foregoing endeavors if the Chairman believes, in his/her sole and exclusive discretion, that the time being spent on such activities infringes upon, or is incompatible with, the Executive’s ability to perform the duties under this Agreement.


2. Compensation and Benefits.

2.1 Base Salary. Executive shall receive a Base Salary at the rate of $900,000 per year. Such Base Salary shall be subject to periodic adjustment from time to time as determined by the Board of Directors in its sole discretion. Base Salary shall be payable in such manner and at such times as the Company shall pay base salary to other similarly situated executive employees.

2.2 Policies and Fringe Benefits. The Executive agrees to abide by the rules, regulations, instructions, personnel practices and policies of the Company and any changes therein that may be adopted from time to time by the Company. The Executive shall be eligible to participate in all benefit programs that the Company establishes and makes available to all of its executives on such terms as the Board of Directors shall determine, if any, to the extent that the Executive meets the eligibility requirements to participate as set forth in the applicable plan or policy. Nothing herein limits the Company’s right to modify, change, limit eligibility or discontinue any plan or policy at any time, with or without prior notice.

2.3 Reimbursement of Expenses. The Company shall reimburse the Executive for all reasonable and appropriate travel, entertainment and other expenses incurred or paid by the Executive in connection with, or related to, the performance of her responsibilities or services under this Agreement, in accordance with policies and procedures, and subject to limitations, adopted by the Company from time to time.

2.4 Withholding. All salary and other compensation payable to the Executive pursuant to this Agreement shall be subject to applicable taxes and withholdings.

3. Termination of Employment and Benefits Upon Termination.

3.1 General. The Executive’s employment pursuant to this Agreement shall terminate upon the earliest to occur of (i) the Executive’s death, (ii) a termination by reason of disability, (iii) a termination by the Company with or without Cause, or (iv) a termination by the Executive. Whenever the Executive’s employment shall terminate, and regardless of the reason for such termination, effective that same date she shall resign all offices, appointments and/or other positions the Executive may hold with the Company including, but not limited to, any parent corporation, subsidiaries or divisions of the Company or any such parent.

3.2 Termination Due to Death. The Executive’s employment shall automatically terminate upon the date of the Executive’s death. No compensation or other benefits shall be payable to or accrue to the Executive hereunder except as follows:

(a) (i) all amounts earned but unpaid hereunder through the date of termination with respect to salary, automobile allowance and vested but unused vacation; (ii) to the extent not already paid, any amounts to which the Executive is entitled under the Company’s annual incentive compensation plan for the fiscal year ended immediately prior to the date of termination; (iii) her vested account balance under the BJ’s Wholesale Club, Inc. 401(k) Savings Plan for Salaried Employees; and (iv) any unreimbursed expenses incurred in accordance with Company policy (collectively, “Earned Obligations”);

 

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(b) any amounts the Executive would have been entitled to receive under the Company’s annual incentive compensation plan had the Executive remained employed by the Company until the end of the fiscal year during which the termination of employment occurs (prorated for the period of active employment during such fiscal year). All such amounts, if any, will be paid to the Executive’s estate at the same time as other incentive compensation plan payments for the year in which the termination occurs are paid; and

(c) any payments or benefits under other plans of the Company to the extent such plans provide for benefits following the Executive’s death.

3.3 Termination Due to Disability. The Executive’s employment may be terminated by reason of the Executive’s disability, upon notice to the Executive, in the event of the inability of the Executive to perform her duties hereunder by reason of disability, whether by reason of injury (physical or mental), illness (physical or mental) or otherwise. For purposes of this Agreement, a disability is defined as the occurrence when the Executive is incapacitated for a continuous period exceeding one hundred twenty (120) days, as certified by a physician selected by the Executive and the Company in good faith. No compensation or other benefits shall be payable to or accrue to the Executive hereunder except as follows:

(a) all Earned Obligations;

(b) any amounts the Executive would have been entitled to receive under the Company’s annual incentive compensation plan had the Executive remained employed by the Company until the end of the fiscal year during which the termination of employment occurs (prorated for the period of active employment during such fiscal year). All such amounts, if any, will be paid at the same time as other incentive compensation plan payments for the year in which the termination occurs are paid; and

(c) any payments or benefits under other plans of the Company to the extent such plans provide for benefits following a termination of employment due to disability.

3.4 Termination by the Company for Cause or by the Executive. The Company may terminate the Executive’s employment at any time for Cause by providing the Executive notice of such termination. For the purpose of this Agreement, termination by the Company for Cause shall refer to the Company’s termination of the Executive’s employment because it has determined, in its sole and exclusive discretion, that she has: (i) refused or failed to devote her full normal working time, skills, knowledge, and abilities to the business of the Company and in promotion of its interests or she has failed to fulfill directives of the Board of Directors; (ii) engaged in activities involving dishonesty, willful misconduct, willful violation of any law, rule, regulation or policy of the Company or breach of fiduciary duty; (iii) committed larceny, embezzlement, conversion or any other act involving the misappropriation of the Company’s funds or property; (iv) been convicted of any crime which reasonably could affect in an adverse manner the reputation of the Company or the Executive’s ability to perform her duties hereunder; (v) been grossly negligent in the performance of her duties; or (vi) materially breached this Agreement including, but not limited to, her obligations set forth in Sections 4 and 5 below. If the Executive’s employment terminates pursuant to this Section 3.4 by the Company for Cause or by

 

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reason of the Executive’s resignation at any time, the Executive shall only receive the Earned Obligations, if any, through her termination date. Nothing herein waives any rights the Company may have for damages or equitable relief.

3.5 Termination by the Company Without Cause. The Company may terminate the Executive’s employment without Cause at any time effective upon the Executive’s receipt of notice of such termination. No compensation or other benefits shall be payable to or accrue to the Executive in the event of her termination without Cause except as follows:

(a) all Earned Obligations;

(b) Subject to the Executive entering into a binding and irrevocable release of claims and separation agreement prepared by the Company, the Executive shall be eligible to receive:

(1) continuation of Base Salary for a period of twenty-four (24) months (the “Severance Period”), payable in such manner and at such times as the Executive’s Base Salary was being paid immediately prior to such termination;

(2) an amount equal to the difference between the Executive’s actual COBRA premium costs and the amount the Executive would have paid had the Executive continued coverage as an employee under the Company’s applicable health plans without regard to the pre-tax benefits the Executive would have received under the BJ’s Wholesale Club, Inc. Flexible Benefits Plan provided that the Executive elects to continue to participate in the Company’s medical and/or dental plans for team members pursuant to a valid COBRA election (and if and only if such participation is legally and contractually permissible) and provided, however, that the Company’s obligations under this clause 3.5(b)(2) shall (A) not extend beyond the Severance Period, (B) be eliminated if the Executive discontinues COBRA benefits or (C) be reduced or eliminated to the extent that the Executive receives similar coverage and benefits under the plans and programs of a subsequent employer or entity or becomes eligible for similar coverage under a spouse’s employer;

(3) any amounts the Executive would have been entitled to receive under the Company’s annual incentive compensation plan had the Executive remained employed by the Company until the end of the fiscal year during which the termination of employment occurs (prorated for the period of active employment during such fiscal year). All such amounts, if any, will be paid at the same time as other incentive compensation plan payments for the year in which the termination occurs are paid; and

(c) payments or benefits under other plans of the Company to the extent that the plans provide for benefits following a termination of employment.

 

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Notwithstanding the foregoing, the payments and benefits described in Section 3.5(b) above shall immediately terminate, and the Company shall have no further obligations to the Executive with respect thereto, in the event that the Executive (i) becomes employed by Wal-Mart Stores, Inc., Costco Wholesale Corporation, Sam’s Clubs, or any of their respective subsidiaries or affiliates; or (ii) breaches any provision of Sections 4 or 5 of this Agreement.

4. Non-Competition and Non-Solicitation.

4.1 Restricted Activities. While the Executive is employed by the Company and for a period of twenty-four (24) months after the termination or cessation of such employment for any reason, the Executive will not directly or indirectly:

(a) Engage in any business or enterprise (whether as owner, partner, officer, director, employee, consultant, investor, lender or otherwise, except as the holder of not more than 1% of the outstanding stock of a publicly-held company) that is competitive with the Company’s business. A business or enterprise shall be deemed competitive if it shall operate a chain of membership warehouse clubs (by way of example, but not limitation, Sam’s Club or Costco), warehouse stores selling food and/or general merchandise that includes a warehouse store located within 10 miles of any “then existing” BJ’s Wholesale Club warehouse store, or any other business that competes with the Company. Competitive business or enterprise also includes any store or business operated or owned by Wal-Mart Stores, Inc., Costco Wholesale Corporation, or any of the respective affiliates thereof. The term “then existing” shall refer to any such warehouse store that is, at the time of termination of the Executive’s employment, operated by the Company or any of its subsidiaries or divisions or under lease for operation as aforesaid; or

(b) Either alone or in association with others (i) solicit, or permit any organization directly or indirectly controlled by the Executive to solicit, any employee of the Company to leave the employ of the Company, or (ii) solicit for employment, hire or engage as an independent contractor, or permit any organization directly or indirectly controlled by the Executive to solicit for employment, hire or engage as an independent contractor, any person who was employed by the Company at the time of the termination or cessation of the Executive’s employment with the Company; provided that this clause (ii) shall not apply to the solicitation, hiring or engagement of any individual whose employment with the Company has been terminated for a period of six (6) months or longer at the time of such solicitation, hiring or employment.

4.2 Extension of Restrictions. If the Executive violates the provisions of Section 4.1, the twenty-four (24) month period referred to in Section 4.1 shall recommence and the Executive shall continue to be bound by the restrictions set forth in Section 4.1 until a period of twenty-four (24) months has expired without any violation of such provisions.

4.3 Interpretation. If any restriction set forth in Section 4.1 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable.

 

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4.4 Equitable Remedies. The restrictions contained in this Section 4 are necessary for the protection of the business and goodwill of the Company and are considered by the Executive to be reasonable for such purpose. The Executive agrees that any breach of this Section 4 is likely to cause the Company substantial and irrevocable damage which is difficult to measure. Therefore, in the event of any such breach or threatened breach, the Executive agrees that the Company, in addition to such other remedies which may be available, shall have the right to obtain an injunction from a court restraining such a breach or threatened breach and the right to specific performance of the provisions of this Section 4, and the Executive hereby waives the adequacy of a remedy at law as a defense to such relief.

5. Proprietary Information.

5.1 Proprietary Information.

(a) The Executive agrees that all information, whether or not in writing, of a private, secret or confidential nature concerning the Company’s business, business relationships or financial affairs (collectively, “Proprietary Information”) is and shall be the exclusive property of the Company. By way of illustration, but not limitation, Proprietary Information may include inventions, products, processes, methods, techniques, formulas, compositions, compounds, projects, developments, plans, research data, financial data, personnel data, computer programs, customer and supplier lists, and contacts at or knowledge of customers or prospective customers of the Company. The Executive will not disclose any Proprietary Information to any person or entity other than employees of the Company or use the same for any purposes (other than in the performance of her duties as an employee of the Company) without written approval by an executive officer of the Company, either during or after her employment with the Company, unless and until such Proprietary Information has become public knowledge without fault by the Executive.

(b) The Executive agrees that all files, letters, memoranda, reports, records, data, sketches, drawings, laboratory notebooks, program listings, or other written, photographic, or other tangible material containing Proprietary Information, whether created by the Executive or others, which shall come into her custody or possession, shall be and are the exclusive property of the Company to be used by the Executive only in the performance of her duties for the Company. All such materials or copies thereof and all tangible property of the Company in the custody or possession of the Executive shall be delivered to the Company, upon the earlier of (i) a request by the Company or (ii) termination of her employment. After such delivery, the Executive shall not retain any such materials or copies thereof or any such tangible property.

(c) The Executive agrees that her obligation not to disclose or to use information and materials of the types set forth in paragraphs (a) and (b) above, and her obligation to return materials and tangible property set forth in paragraph (b) above also extends to such types of information, materials and tangible property of customers of the Company or suppliers to the Company or other third parties who may have disclosed or entrusted the same to the Company or to the Executive.

 

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5.2 Equitable Remedies. The restrictions contained in this Section 5 are necessary for the protection of the business and goodwill of the Company and are considered by the Executive to be reasonable for such purpose. The Executive agrees that any breach of this Section 5 is likely to cause the Company substantial and irrevocable damage which is difficult to measure. Therefore, in the event of any such breach or threatened breach, the Executive agrees that the Company, in addition to such other remedies which may be available, shall have the right to obtain an injunction from a court restraining such a breach or threatened breach and the right to specific performance of the provisions of this Section 5, and the Executive hereby waives the adequacy of a remedy at law as a defense to such relief.

6. Other Agreements. The Executive represents that her performance of all the terms of this Agreement and the performance of her duties as an employee of the Company do not and will not breach any agreement with any prior employer or other party to which the Executive is a party (including without limitation any nondisclosure or non-competition agreement). Any agreement to which the Executive is a party relating to nondisclosure, non-competition or non-solicitation of employees or customers is listed on Schedule A attached hereto.

7. Miscellaneous.

7.1 Notices. Any notice delivered under this Agreement shall be deemed duly delivered four (4) business days after it is sent by registered or certified mail, return receipt requested, postage prepaid, or one business day after it is sent for next-business day delivery via a reputable nationwide overnight courier service, in each case to the address of the recipient set forth in the introductory paragraph hereto. Either party may change the address to which notices are to be delivered by giving notice of such change to the other party in the manner set forth in this Section 7.1.

7.2 Pronouns. Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa.

7.3 Entire Agreement. This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter of this Agreement, including but not limited to the Employment Agreement dated April 3,2007 entered into by the Company and the Executive.

7.4 Amendment. This Agreement may be amended or modified only by a written instrument executed by both the Company and the Executive.

7.5 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts (without reference to the conflicts of laws provisions thereof), except as may be preempted by the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §1001 et seq. Any action, suit or other legal proceeding

 

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arising under or relating to any provision of this Agreement shall be commenced only in a court of the Commonwealth of Massachusetts (or, if appropriate, a federal court located within Massachusetts), and the Company and the Executive each consents to the jurisdiction of such a court. The Company and the Executive each hereby irrevocably waives any right to a trial by jury in any action, suit or other legal proceeding arising under or relating to any provision of this Agreement.

7.6 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any corporation with which, or into which, the Company may be merged or which may succeed to the Company’s assets or business; provided, however, that the obligations of the Executive are personal and shall not be assigned by him/her.

7.7 Waivers. No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion. Notwithstanding the foregoing, if the Company is merged with or into a third party which is engaged in multiple lines of business, or if a third party engaged in multiple lines of business succeeds to the Company’s assets or business, then for purposes of Section 4.l(a), the term “Company” shall mean and refer to the business of the Company as it existed immediately prior to such event and as it subsequently develops and not to the third party’s other businesses.

7.8 Captions. The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

7.9 Severability. In case any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby.

* * * * *

 

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THE EXECUTIVE ACKNOWLEDGES THAT SHE HAS CAREFULLY READ

THIS AGREEMENT AND UNDERSTANDS AND AGREES TO ALL OF THE

PROVISIONS IN THIS AGREEMENT.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth above.

 

 

 

 

 

 

 

 

 

 

BJ’S WHOLESALE CLUB, INC.

 

 

 

 

 

 

 

Description: LOGO

 

 

 

Description: LOGO

Herbert J. Zarkin

 

 

 

Laura J. Sen

Chairman of the Board

 

 

 

President and Chief Executive Officer

 

 

 

 

 

ATTEST:

 

Description: LOGO

 

 

 

WITNESS:

 

Description: LOGO

 

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EX-10.16.(B) 7 dex1016b.htm ADDENDUM TO EMPLOYMENT AGREEMENT , LAURA J. SEN

Exhibit 10.16b

BJ’S WHOLESALE CLUB, INC.

ADDENDUM TO EMPLOYMENT AGREEMENT

This Addendum to Employment Agreement is entered into this 21st day of December, 2009, by and between BJ’s Wholesale Club, Inc. (the “Company”) and Laura J. Sen (the “Executive”):

W I T N E S S E T H

WHEREAS Company and Executive entered into an Employment Agreement dated February 1, 2009 (the “Agreement”); and

WHEREAS Section 7.4 of the Agreement provides that it may be amended by a written instrument executed by both parties; and

WHEREAS Company and Executive wish to modify the terms of the Agreement to conform with Section 409A of the Internal Revenue Code.

NOW THEREFORE, in consideration of the mutual covenants contained herein, the parties agree to modify the Agreement as follows:

1. The following new Section 3.6 is added to the Agreement immediately after Section 3.5:

“3.6 Special Rules Applicable to Deferred Compensation.

(a) Delayed Payment for Specified Employees. Notwithstanding any other provision of this Agreement, if on the date of his separation from service, Executive is a Specified Employee, neither Base Salary pursuant to Section 3.5(b)(1) nor any other amount constituting the deferral of compensation, within the meaning of Section 409A(d) of the Internal Revenue Code (“Code”) and the regulations issued thereunder, that would otherwise be paid solely as a result of such separation shall be paid to Executive during the six-month period beginning on the date of such separation, provided that (i) such delay shall not be required to the extent that the sum of such payments during the six-month period does not exceed two times the lesser of (A) Executive’s Base Salary for the calendar year preceding the separation from service (adjusted for permanent increases taking effect during such year) or (B) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year of Executive’s separation from service, (ii) the originally scheduled payment, together with each installment (if any) that would otherwise have been paid to Executive during the six-month period, shall be paid on the first day of the seventh month following such termination, and (iii) if Executive dies during the

 

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period in which no payment may be made, such period shall immediately end and all installments then due to Executive shall be paid in accordance with Executive’s beneficiary designation or, if no such designation has been made or applies, to his estate. For purposes of the preceding sentence, Executive’s status as a Specified Employee, which shall be determined in accordance with regulations under Sections 409A and 416 of the Code without regard to Section 416(i)(5) of the Code, begins on April 1, based upon his being described in the following sentence during the calendar year preceding such date and shall continue for a period of 12 consecutive months after such April 1. Executive is described in this sentence if, at any time during a calendar year, (i) he was an officer of the Company having annual compensation from the Company, and all entities aggregated with it under Section 414(b) and (c) of the Code, in excess of $130,000, as adjusted under Section 416(i)(A) of the Code, and was among the 50 such officers with the highest annual compensation; (ii) he owned (or was considered as owning within the meaning of Section 318 of the Code) more than 5% of the outstanding stock of the Company or stock possessing more than 5% of the total combined voting power of all stock of the Company; or (iii) he owned (or was considered as owning within the meaning of Section 318 of the Code) more than 1% of the outstanding stock of the Company or stock possessing more than 1% of the total combined voting power of all stock of the Company, and had annual compensation from the Company in excess of $150,000. For purposes of the preceding sentence, an individual’s annual compensation shall be the total compensation reported in box 1 of IRS Form W-2 for the applicable calendar year.

(b) Acceleration of Payments Prohibited. Notwithstanding anything to the contrary, Sections 3.3(a), 3.3(c), 3.4, 3.5(a) and 3.5(c) shall be construed and applied so that the time of payment of any amount constituting the deferral of compensation, within the meaning of Section 409A(d) of the Code and the regulations issued thereunder, shall be determined in accordance with the plan or other arrangement providing such payment and shall not be accelerated as a result of Executive’s disability or termination of employment to which this Agreement applies.”

2. Except as modified by this Addendum, all other provisions of the Employment Agreement remain in full force and effect.

 

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IN WITNESS WHEREOF, the parties hereto being duly authorized have executed this Addendum to be effective as of the date first set forth above.

 

EXECUTIVE

 

BJ’S WHOLESALE CLUB, INC.

By: /s/ Laura J. Sen                        

 

By: /s/ Herbert J Zarkin                        

            Laura J. Sen                      

 

 

Dated: 12/21/09        

 

Dated: 12/21/09        

 

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EX-10.16.(D) 8 dex1016d.htm 2010 ADDENDUM TO EMPLOYMENT AGREEMENT, LAURA J. SEN

Exhibit 10.16d

BJ’S WHOLESALE CLUB, INC.

2010 ADDENDUM TO EMPLOYMENT AGREEMENT

This Addendum to Employment Agreement is entered into this 20th day of December, 2010 by and between BJ’s Wholesale Club, Inc. (the “Company”) and Laura J. Sen (the “Executive”):

W I T N E S S E T H

WHEREAS Company and Executive entered into an Employment Agreement dated as of February 1, 2009 (the “Agreement”); and

WHEREAS Section 7.4 of the Agreement provides that it may be amended by a written instrument executed by both parties; and

WHEREAS Company and Executive wish to modify the terms of the Agreement to conform to the requirements Section 409A of the Internal Revenue Code, as interpreted by Internal Revenue Service Notice 2010-6,

NOW THEREFORE, in consideration of the mutual covenants contained herein, the parties agree to modify the Agreement as follows:

1. The first clause of Section 3.5(b) of the Agreement preceding paragraph (1) thereof is amended to read as follows:

“Subject to the Executive entering into a binding and irrevocable release of claims and separation agreement prepared by the Company and the expiration on or before the 60th day after the Executive’s separation from service of any period during which the Executive is entitled to revoke the release, the Executive shall be eligible on such sixtieth (60th) day to receive:”

2. Except as modified by this Addendum, all other provisions of the Employment Agreement remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto being duly authorized have executed this Addendum to be effective as of the date first set forth above.

 

EXECUTIVE

 

BJ’S WHOLESALE CLUB, INC.

/s/ Laura J. Sen                            

 

By:

 

/s/ Herbert J Zarkin                                

Laura J. Sen, President and CEO

 

 

Herbert J Zarkin, Chairman

12/21/10        

 

12/27/10        

Dated

 

Dated

 

 

 

EX-10.16(A) 4 dex1016a.htm CHANGE OF CONTROL SEVERENCE AGREEMENT DATED AS OF FEBRUARY 1, 2009

Exhibit 10.16a

Laura J. Sen

CHANGE OF CONTROL SEVERANCE AGREEMENT

THIS AGREEMENT between BJ’s Wholesale Club, Inc., a Delaware corporation (the “Company”), and Laura J. Sen (“Executive”), dated as of February 1, 2009.

Executive is a key executive of the Company or a Subsidiary and an integral part of its management.

The Company recognizes that the possibility of a Change of Control or Potential Change of Control of the Company may result in the departure or distraction of management to the detriment of the Company and its shareholders and wishes to modify and restate the agreement previously applicable under such circumstances.

The Company wishes to assure Executive of fair severance should Executive’s employment terminate in specified circumstances following a Change of Control or Potential Change of Control of the Company and to assure Executive of certain other benefits upon such event.

In consideration of Executive’s continued employment with the Company or a Subsidiary and other good and valuable consideration, the parties agree as follows:

Benefits Upon Change of Control.

In General. Within 30 days following the earlier of a Change of Control or Potential Change of Control (such earlier event to be a “Control Event”) as long as this Agreement had not been terminated under Section 8.6 at the time of the Control Event, then whether or not Executive’s employment has been terminated following the Control Event, the Company shall pay to Executive the following in a lump sum:

an amount equal to the product of (i) the “Target Bonus” under the Company’s Management Incentive Plan or any other annual incentive plan which is applicable to Executive for the fiscal year in which the Control Event occurs (or if the Target Bonus is reduced within 180 days before the commencement of a Standstill Period, the “Target Bonus” applicable to Executive for the fiscal year in which such reduction occurred) and (ii) a fraction, the numerator of which is the number of days in such fiscal year prior to the Control Event and the denominator of which is 365; and

if Executive is a participant in a performance-based long-range incentive plan at the time of a Control Event, such amount as is required to be paid to Executive upon a Control Event pursuant to the provisions of such plan; provided, that if such incentive plan does not provide for an automatic payment on the earlier of a Change of Control or a Potential Change of Control, then any payment under such incentive plan shall be made only as and when provided for in such incentive plan even though the benefit under Section 1.1(a) above has been paid previously.


Benefits Following Qualified Termination of Employment. Executive shall be entitled to the following benefits upon a Qualified Termination:

(a) Within 30 days following the Date of Termination, the Company shall pay to Executive the following in a lump sum:

(i) an amount equal to three times Executive’s Base Salary for one year at the rate in effect immediately prior to the Date of Termination or, if higher, the Control Event (or if Executive’s Base Salary was reduced within 180 days before the commencement of a Standstill Period, the rate in effect immediately prior to such reduction), plus the accrued and unpaid portion of Executive’s Base Salary through the Date of Termination. Any payments made to Executive under any long term disability plan of the Company with respect to the three years following termination of employment shall be offset against such three times Base Salary payment. Executive shall promptly make reimbursement payments to the Company to the extent any such disability payments are received by Executive after the Base Salary payment;

(ii) an amount equal to three times Executive’s automobile allowance for one year at the rate in effect immediately prior to the Date of Termination or, if higher, the Control Event (or if such automobile allowance was reduced within 180 days before the commencement of a Standstill Period, the rate in effect immediately prior to such reduction unless such reduction was offset by an increase in Base Salary during such 180-day period), plus any portion of Executive’s automobile allowance payable but unpaid through the Date of Termination; and

(iii) an amount equal to three times the Target Bonus amount, as defined and determined under Section 1.1(a) above without any fractional adjustment.

(b) For a period of thirty-six (36) months after the Date of Termination, the Company shall maintain in full force and effect for the continued benefit of Executive and Executive’s family all life insurance and medical insurance (other than long-term disability) plans and programs in which Executive was entitled to participate immediately prior to the Control Event (or if Executive’s title was changed to a level below that of Executive’s Current Title within 180 days before the commencement of a Standstill Period, all such plans and programs in which Executive was entitled to participate immediately prior to such change, if the benefits thereunder are greater), provided that Executive’s continued participation is possible under the general terms and provisions of such plans and programs. In the event that participation in such plans or programs is not available to Executive for any reason, including termination of the plan, the Company shall arrange upon comparable terms to provide Executive with benefits substantially similar to those which Executive is entitled to receive under such plans and programs. Notwithstanding the foregoing, the Company’s obligations hereunder with respect to life insurance or medical insurance plans and programs shall be deemed satisfied to the extent (but only to the extent) of any such insurance coverage or benefits provided by another employer.

 

2


(c) If Qualified Termination occurs by reason of Disability, the Company shall maintain in full force and effect for the continued benefit of Executive, disability benefits and/or disability insurance at the same level to which Executive was entitled immediately prior to the Qualified Termination.

Coordination With Certain Tax Rules.

Notwithstanding any other provision of this Agreement, in the event that the Company undergoes a Change in Ownership or Control (as defined below), the Company shall not be obligated to provide to Executive a portion of any “Contingent Compensation Payments” that Executive would otherwise be entitled to receive to the extent necessary to eliminate any “excess parachute payments” (as defined in Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended (the “Code”)) for Executive. For purposes of this Section 1.3, the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Payments” and the aggregate amount (determined in accordance with Proposed Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision) of the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Amount.”

For purposes of this Section 1.3, the following terms shall have the following respective meanings:

Change in Ownership or Control” shall mean a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company determined in accordance with Section 280G(b)(2) of the Code.

Contingent Compensation Payments” shall mean any payment (or benefit) in the nature of compensation that is made or made available (under this Agreement or otherwise) to a “disqualified individual” (as defined in Section 280G(c) of the Code) and that is contingent (within the meaning of Section 280G (b) (2) (A) (i) of the Code) on a Change in Ownership or Control of the Company.

Any payments or other benefits otherwise due to the Executive following a Change in Ownership or Control that could be characterized (as reasonably determined by the Company) as Contingent Compensation Payments shall not be made until the determination, pursuant to this Section 1.3(c), of which Contingent Compensation Payments shall be treated as Eliminated Payments. Within 30 days after each date on which the Executive first becomes entitled to receive (whether or not then due) a Contingent Compensation Payment relating to such Change in Ownership or Control, the Company shall determine and notify Executive (with reasonable detail regarding the basis for its determinations) (i) which of such payments and benefits constitute

 

3


Contingent Compensation Payments and (ii) the Eliminated Amount. Within 30 days after delivery of such notice to Executive, Executive shall notify the Company which Contingent Compensation Payments, or portions thereof (the aggregate amount of which, determined in accordance with Proposed Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision, shall be equal to the Eliminated Amount), shall be treated as Eliminated Payments. In the event that Executive fails to notify the Company pursuant to the preceding sentence on or before the required date, the Contingent Compensation Payments (or portions thereof) that shall be treated as Eliminated Payments shall be determined by the Company in its absolute discretion.

The provisions of this Section 1.3 are intended to apply to any and all payments or benefits available to Executive under this Agreement or any other agreement or plan of the Company under which Executive receives Contingent Compensation Payments.

Definitions. The terms defined in Exhibits A and B hereto are used herein as so defined.

Noncompetition; No Mitigation of Damages; Other Severance Payments; Withholding.

Noncompetition. Upon a Qualified Termination, any agreement by Executive not to engage in competition with the Company subsequent to the termination of Executive’s employment, whether contained in an employment contract or other agreement shall no longer be effective.

No Duty to Mitigate Damages. Executive’s benefits under this Agreement shall be considered severance pay in consideration of Executive’s past service and Executive’s continued service from the date of this Agreement, and Executive’s entitlement thereto shall neither be governed by any duty to mitigate Executive’s damages by seeking further employment nor offset by any compensation which Executive may receive from future employment.

Other Severance Payments. In the event that Executive has an employment contract or any other agreement with the Company (or a Subsidiary) which entitles Executive to severance payments upon the termination of Executive’s employment with the Company, the amount of any such severance payments shall be deducted from the payments to be made under this Agreement.

2.4 Withholding. Anything to the contrary notwithstanding, all payments required to be made by the Company hereunder to Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Company may reasonably determine it should withhold pursuant to any applicable law or regulation.

Arbitration. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled exclusively by arbitration in Boston, Massachusetts in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect, and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.

 

4


Legal Fees and Expenses. The Company shall pay all legal fees and expenses, including, but not limited to, counsel fees, stenographer fees, printing costs, etc. reasonably incurred by Executive in contesting or disputing that the termination of Executive’s employment during a Standstill Period is for Cause or other than for good reason (as defined in paragraph (k) of Exhibit A) or in obtaining any right or benefit to which Executive is entitled under this Agreement. Any amount payable under this Agreement that is not paid when due shall accrue interest at the prime rate as from time to time in effect at BankBoston, N.A., or its successor, until paid in full.

Notice of Termination. During a Standstill Period, Executive’s employment may be terminated by the Company (or a Subsidiary) only upon 30 days’ written notice to Executive.

Notices. All notices shall be in writing and shall be deemed given five days after mailing in the continental United States by registered or certified mail, or upon personal receipt after delivery, telex, telecopy or telegram, to the party entitled thereto at the address stated below or to such changed address as the addressee may have given by a similar notice:

 

 

 

 

To the Company:

  

BJ’s Wholesale Club, Inc.

 

  

One Mercer Road

 

  

Natick, MA 01760

 

  

Attention: President

 

 

To Executive:

  

At Executive’s home address, as last shown on the records of the Company.

Severability. In the event that any provision of this Agreement shall be determined to be invalid or unenforceable, such provision shall be enforceable in any other jurisdiction in which valid and enforceable and in any event the remaining provisions shall remain in full force and effect to the fullest extent permitted by law.

General Provisions.

Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties and be enforceable by Executive’s personal legal representatives or successors. If Executive dies while any amounts would still be payable to Executive hereunder, benefits would still be provided to Executive’s family hereunder or rights would still be exercisable by Executive hereunder as if Executive had continued to live. Such amounts shall be paid to Executive’s estate, such benefits shall be provided to Executive’s family and such rights shall remain exercisable by Executive’s estate in accordance with the terms of this Agreement. This Agreement shall not otherwise be assignable by Executive.

Successors. This Agreement shall inure to and be binding upon the Company’s successors, including any successor to all or substantially all of the Company’s business and/or assets. The Company will require any successor to all or substantially all of the business and/or assets of the Company by sale, merger (where the Company is not the surviving corporation), lease or otherwise, by

 

5


agreement in form and substance satisfactory to Executive, to assume expressly this Agreement. If the Company shall not obtain such agreement prior to the effective date of any such succession, Executive shall have all rights resulting from a Qualified Termination by Executive for good reason (as defined in paragraph (k) of Exhibit A) under this Agreement. This Agreement shall not otherwise be assignable by the Company.

Amendment or Modification; Waiver. This Agreement may not be amended unless agreed to in writing by Executive and the Company. No waiver by either party of any breach of this Agreement shall be deemed a waiver of a subsequent breach.

Titles. No provision of this Agreement is to be construed by reference to the title of any section.

Continued Employment. This Agreement shall not give Executive any right of continued employment or any right to compensation or benefits from the Company or any Subsidiary except the right specifically stated herein to certain severance and other benefits, and shall not limit the Company’s (or a Subsidiary’s) right to change the terms of or to terminate Executive’s employment, with or without Cause, at any time other than during a Standstill Period, except as may be otherwise provided in a written employment agreement between the Company (or a Subsidiary) and Executive.

Termination of Agreement Outside of Standstill Period. This Agreement shall be automatically terminated upon the first to occur of (i) the termination of Executive’s employment for any reason, whether voluntary or involuntary, at any time other than during a Standstill Period or (ii) the 180th day after a change in Executive’s title to a level below that of Executive’s Current Title unless a Standstill Period was in effect on the date of such change or within 180 days thereafter or (iii) if Executive is employed by a Subsidiary of the Company, the date on which the Subsidiary either ceases to be a Subsidiary of the Company or sells or otherwise disposes of all or substantially all of its assets, unless such event occurs during a Standstill Period and Executive’s employment shall have been terminated in a Qualified Termination within 90 days of such event, or (iv) March 31, 2002; provided that on March 31, 2000 and each March 31 thereafter, the termination date provided in this clause (iv) shall be automatically extended for an additional year (the “Date”) (so that on March 31, 2000 the Date shall become March 31, 2003, and so on) unless, not later than 90 days prior to any March 31, the Company shall have given the Executive written notice that the term of this Agreement will not be further extended.

8.7 Prior Agreement. This Agreement amends and restates and shall supersede and replace any prior change of control severance agreement between the Company or any of its subsidiaries, or any predecessor, and Executive.

8.8 Governing Law. The validity, interpretation, performance and enforcement of this Agreement shall be governed by the laws of the Commonwealth of Massachusetts.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

 

6


 

BJ’S WHOLESALE CLUB, INC.

 

/s/ HERBERT J ZARKIN

Herbert J Zarkin

Chairman of the Board

 

/s/ LAURA J. SEN

Laura J. Sen

President and Chief Executive Officer

 

7


EXHIBIT A

Definitions

The following terms as used in this Agreement shall have the following meanings:

Base Salary” shall mean Executive’s annual base salary, exclusive of any bonus or other benefits Executive may receive.

Cause” shall mean (i) dishonesty, (ii) conviction of a felony, (iii) gross neglect of duties (other than as a result of Incapacity, Disability or death), or (iv) conflict of interest; provided that for purposes of clauses (iii) or (iv) any such gross neglect or conflict shall continue for 30 days after the Company gives written notice to Executive requesting the cessation of such gross neglect or conflict, as the case may be.

In respect of any termination during a Standstill Period, Executive shall not be deemed to have been terminated for Cause until the later to occur of (i) the 30th day after notice of termination is given and (ii) the delivery to Executive of a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the Company’s directors at a meeting called and held for that purpose (after reasonable notice to Executive), and at which Executive together with Executive’s counsel was given an opportunity to be heard, finding that Executive was guilty of conduct described in the definition of “Cause” above, and specifying the particulars thereof in detail; provided, however, that the Company may suspend Executive and withhold payment of Executive’s Base Salary from the date that notice of termination is given until the earliest to occur of (a) termination of Executive for Cause effected in accordance with the foregoing procedures (in which case Executive shall not be entitled to Executive’s Base Salary for such period), (b) a determination by a majority of the Company’s directors that Executive was not guilty of the conduct described in the definition of “Cause” above (in which case Executive shall be reinstated and paid any of Executive’s previously unpaid Base Salary for such period), or (c) the 90th day after notice of termination is given (in which case Executive shall be reinstated and paid any of Executive’s previously unpaid Base Salary for such period).

Change of Control” shall have the meaning set forth in Exhibit B.

Company” shall mean BJ’s Wholesale Club, Inc. or any successor.

Current Title” shall mean Executive’s title on the date 180 days prior to the commencement of a Standstill Period.

Date of Termination” shall mean the date on which Executive’s employment is terminated.

Disability” shall have the meaning given it in the Company’s long-term disability plan. Executive’s employment shall be deemed to be terminated for Disability on the date on which Executive is entitled to receive long-term disability compensation pursuant to such long-term disability plan.

 

8


Executive” shall mean the person named in the first paragraph of this Agreement.

Incapacity” shall mean a disability (other than Disability within the meaning of the definition in (g) above) or other impairment of health that renders Executive unable to perform Executive’s duties to the reasonable satisfaction of the Board of Directors of the Company. If by reason of Incapacity Executive is unable to perform Executive’s duties for at least six months in any 12-month period, upon written notice by the Company, the employment of Executive shall be deemed to have terminated by reason of Incapacity.

Potential Change of Control” shall mean:

the Company enters into an agreement, the consummation of which would result in the occurrence of a Change of Control; or

the Board of Directors of the Company adopts a resolution that, for purposes of this Agreement, a Potential Change of Control has occurred.

Qualified Termination” shall mean the termination of Executive’s employment during a Standstill Period (1) by the Company other than for Cause, or (2) by Executive for good reason, or (3) by reason of death, Incapacity or Disability.

For purposes of this definition, termination for “good reason” shall mean the voluntary termination by Executive of Executive’s employment (A) within 120 days after the occurrence without Executive’s express written consent of any of the events described in clauses (I), (II), (III), (IV), (V) or (VI) below, provided that Executive gives notice to the Company at least 30 days in advance requesting that the situation described in those clauses be remedied, and the situation remains unremedied upon expiration of such 30-day period; (B) within 120 days after the occurrence without Executive’s express written consent (which must expressly refer to such consent as being given under this Agreement) of the events described in clauses (VII) or (VIII) below, provided that Executive gives notice to the Company at least 30 days in advance; or (C) upon occurrence of the event described in clause (IX) below, provided that Executive gives notice to the Company at least 30 days in advance:

 

 

(I)

the assignment to Executive of any duties inconsistent with Executive’s positions, duties, responsibilities, reporting requirements, and status with the Company (or a Subsidiary) immediately prior to a Control Event, or a substantive change in Executive’s titles or offices as in effect immediately prior to a Control Event, or any removal of Executive from or any failure to reelect Executive to such positions, except in connection with the termination of Executive’s employment by the Company (or a Subsidiary) for Cause or by Executive other than for good reason; or any other action by the Company (or a Subsidiary) which results in a diminishment in such position, authority, duties or responsibilities, other than an insubstantial and inadvertent action which is remedied by the Company or the Subsidiary promptly after receipt of notice thereof given by Executive; or

 

9


 

(II)

Executive’s rate of Base Salary for any fiscal year is less than 100 percent of the rate of Base Salary paid to Executive in the completed fiscal year immediately preceding the Control Event, or Executive’s total cash compensation opportunities, including salary, auto allowance, and incentives, for any fiscal year are less than 100 percent of the total cash compensation opportunities made available to Executive in the completed fiscal year immediately preceding the Control Event, unless any such reduction represents an overall reduction of no more than 5 percent of the rate of Base Salary paid or cash compensation opportunities made available, as the case may be, and affects all other executives in the same organizational level (it being the Company’s burden to establish this fact); or

 

 

(III)

the failure of the Company (or a Subsidiary) to continue in effect any benefits or perquisites, or any pension, life insurance, medical insurance or disability plan in which Executive was participating immediately prior to the Control Event (the “Benefits,” individually, a “Benefit”) unless the Company (or a Subsidiary) provides Executive with substantially similar Benefits, or the taking of any action by the Company (or a Subsidiary) that would adversely affect Executive’s participation in or materially reduce any of Executive’s Benefits or deprive Executive of any material Benefit enjoyed by Executive immediately prior to the Control Event, unless any elimination or reduction of any Benefit, or any adverse effect on Executive’s participation has an aggregate value equal to no more than 5 percent of the Benefits, and affects all other executives in the same organizational level (it being the Company’s burden to establish this fact); or

 

 

(IV)

any purported termination of Executive’s employment by the Company (or a Subsidiary) for Cause during a Standstill Period which is not effected in compliance with paragraph (b) of this Exhibit; or

 

 

(V)

any relocation of Executive of more than 40 miles from the place where Executive was located at the time of the Control Event; or

 

 

(VI)

any other breach by the Company of any provision of this Agreement; or

 

 

(VII)

the Company sells or otherwise disposes of, in one transaction or a series of related transactions, assets or earning power aggregating more than 30 percent of the assets (taken at asset value as stated on the books of the Company determined in accordance with generally accepted accounting principles consistently applied) or earning power of the Company (on a non-consolidated basis) or the Company and its Subsidiaries (on a consolidated basis) to any other Person or Persons (as defined in Exhibit B); or

 

 

(VIII)

if Executive is employed by a Subsidiary of the Company, such Subsidiary either ceases to be a Subsidiary of the Company or sells or otherwise disposes of, in one transaction or a series of related transactions, assets or earning power aggregating more than 30 percent of the assets (taken at asset value as stated on the books of the Subsidiary determined in

 

10


 

accordance with generally accepted accounting principles consistently applied) or earning power of such Subsidiary (on a non-consolidated basis) or such Subsidiary and its subsidiaries (on a consolidated basis) to any other Person or Persons (as defined in Exhibit B); or

 

 

(IX)

the voluntary termination by Executive of Executive’s employment at any time during the period commencing eight months plus one day after the Change of Control and ending 12 months after the Change of Control, provided, that in the event of any such voluntary termination pursuant to this clause (IX), the Executive shall be entitled to receive only one-half (1/2) of the lump sum amount provided for in Section 1.2(a) of this Agreement and the benefits provided for in Section 1.2(b) shall be provided for one year rather than three years from the Date of Termination.

Standstill Period” shall be the period commencing on the date of a Control Event and continuing until the close of business on the last business day of the 24th calendar month following a Change of Control; provided, however, if no Change of Control occurs within 12 months of a Potential Change of Control, then the Standstill Period that began as a result of such Potential Change of Control shall end on the close of business on the last business day of the 12th calendar month following such Potential Change of Control.

Subsidiary” shall mean any corporation in which the Company owns, directly or indirectly, 50 percent or more of the total combined voting power of all classes of stock or with respect to determining the subsidiaries of a Subsidiary in paragraph (k) (VIII), shall mean any corporation in which the Subsidiary owns, directly or indirectly, 50 percent or more of the total combined voting power of all classes of stock.

 

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EXHIBIT B

Definition of Change of Control

 

A

Change of Control” shall mean:

(a) The acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (iv) any acquisition by any corporation pursuant to a transaction which satisfies the criteria set forth in clauses (i), (ii) and (iii) of subsection (c) of this definition; or

(b) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequently to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board (except that this proviso shall not apply to any individual whose initial assumption of office as a director occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board); or

(c) Consummation of a reorganization, merger or consolidation involving the Company or a sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, immediately following such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, of the corporation resulting from such Business Combination (which as used in Section (c) of this definition shall include, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related

 

12


trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination, or the combined voting power of the then-outstanding voting securities of such corporation and (iii) at least half of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

(d) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

13

 

 

EX-10.2 2 dex102.htm AMENDMENT TO CHANGE OF CONTROL SEVERANCE, LAURA J. SEN

Exhibit 10.2

BJ’S WHOLESALE CLUB, INC.

AMENDMENT TO CHANGE OF CONTROL SEVERANCE AGREEMENT

This Amendment to the Change of Control Severance Agreement (the “Agreement”) between BJ’s Wholesale Club, Inc (the “Company”) and Laura J. Sen (the “Executive”), being President and Chief Executive Officer of the Company, is made March 25, 2010.

W I T N E S S E T H

WHEREAS Company and Executive entered into the Agreement dated February 1, 2009; and

WHEREAS Section 8.3 of the Agreement provides that the Agreement may be amended by a written instrument executed by both parties; and

WHEREAS Company and Executive wish to modify the terms of the Agreement so that they conform with Section 409A of the Internal Revenue Code.

NOW THEREFORE, in consideration of the mutual covenants contained herein, the parties agree to modify the Agreement as follows:

1. Effective January 31, 2010, Section 1.1(a) and Section 1.2(a)(iii) of the Agreement are amended by substituting “target incentive award” in place of “Target Bonus”.

2. Effective January 31, 2010, Section 4 of the Agreement is amended by substituting “Bank of America” in place of “BankBoston NA”.

3. Effective January 31, 2010, the following new Section 8.9 is added to the Agreement:

Acceleration of Payments Prohibited. Notwithstanding anything to the contrary, this Agreement shall be construed and applied so that the time of payment of any amount constituting the deferral of compensation, within the meaning of Section 409A(d) of the Code and the regulations issued thereunder, shall be determined in accordance with the plan or other arrangement providing such payment and shall not be accelerated as a result of Executive’s separation from service with the Company to which this Agreement applies.”

4. Effective January 31, 2010, paragraph (f) of Exhibit A is amended to read as follows:

“ ‘Date of Termination’ shall mean the date on which the Executive has a separation from service.”


5. Effective January 31, 2010, the second sentence of paragraph (k) of Exhibit A is amended to read as follows:

“For purposes of this definition, termination for “good reason” shall mean, the voluntary separation from service with the Company by Executive (A) within 120 days after the occurrence without the Executive’s express written consent of any of the events described in clauses (I), (II), (III), (IV), (V) or (VI) below, provided that Executive gives notice to the Company at least 30 days in advance requesting that the situation described in those clauses be remedied, and the situation remains unremedied upon expiration of such 30-day period:”

6. Effective January 31, 2010, clauses (VII), (VIII) and (IX) of paragraph (k) of Exhibit A are deleted.

7. Effective January 31, 2010, paragraph (m) of Exhibit A is amended to read as follows:

“ ‘Subsidiary’ shall mean any corporation in which the Company owns, directly or indirectly, 50 percent or more of the total combined voting power of all classes of stock.”

8. Except as modified by this Amendment all other provisions of the Agreement remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto, being duly authorized, have executed this Amendment to the Change of Control Severance Agreement to be effective as of the dates specified herein.

 

EXECUTIVE

 

 

BJ’S WHOLESALE CLUB, INC.

/s/ Laura J. Sen

 

 

By:

 

/s/ Herbert J. Zarkin

Laura J. Sen

 

 

 

Herbert J. Zarkin

 

5/10/10

 

 

5/10/10

Dated

 

 

 

Dated

 

LP10:ECC/Sen Amendment to COC

 

2

 

 

 

EX-10.16.(E) 9 dex1016e.htm AMENDMENT NO. 2 TO CHANGE OF CONTROL SEVERANCE AGREEMENT, LAURA J. SEN

Exhibit 10.16e

BJ’S WHOLESALE CLUB, INC.

AMENDMENT NO. 2 TO CHANGE IN CONTROL SEVERANCE AGREEMENT

This Amendment No. 2 to Change in Control Severance Agreement (the “Amendment”) between BJ’s Wholesale Club, Inc. (the “Company”) and Laura J. Sen (“Executive”) is made as of March 24, 2011.

WHEREAS, the Company and Executive entered into a Change in Control Severance Agreement dated February 1, 2009, as amended on March 25, 2010 (as so amended, the “Agreement”).

WHEREAS, the parties desire to further amend the Agreement to provide that the “excess parachute payment” excise tax cut-back provisions included in the Agreement will apply only if Executive would be better off on an after-tax basis after such cut-back.

NOW, THEREFORE, for valuable consideration, receipt of which is acknowledged, the parties agree as follows:

1. Section 1.3 of the Agreement is deleted in its entirety and replaced by the following:

“Coordination With Certain Tax Rules.

In the event that the Company undergoes a Change in Ownership or Control (as defined below), the Company shall not be obligated to provide to Executive a portion of any Contingent Compensation Payments (as defined below) that Executive would otherwise be entitled to receive to the extent necessary to eliminate any Excess Parachute Payments (as defined below) for Executive. For purposes of this Section 1.3, the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Payments” and the aggregate amount (determined in accordance with Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision) of the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Amount.” Notwithstanding any other provision of this Agreement, if the Eliminated Amount for Executive equals or exceeds the sum of:

(i) the Threshold Amount (as defined below), plus

(ii) the Income Tax Payable on the Eliminated Amount (as defined below), plus

(iii) the Excise Tax Payable on Excess Parachute Payments (as defined below), no portion of any Contingent Compensation Payments shall be eliminated for Executive.

For purposes of this Section 1.3, the following terms shall have the following respective meanings:


“Change in Ownership or Control” shall mean a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company determined in accordance with Section 280G(b)(2) of the Code.

“Contingent Compensation Payments” shall mean any payment (or benefit) in the nature of compensation that is made or made available (under this Agreement or otherwise) to a “disqualified individual” (as defined in Section 280G(c) of the Code) and that is contingent (within the meaning of Section 280G (b) (2) (A) (i) of the Code) on a Change in Ownership or Control of the Company.

“Excess Parachute Payments” shall mean “excess parachute payments” as defined in Section 280G(b)(1) of the Code before taking into account the Eliminated Amount, if otherwise applicable.

“Threshold Amount” shall mean $25,000.

“Income Tax Payable on the Eliminated Amount” shall mean the Eliminated Amount (determined without regard to whether any Contingent Compensation Payments are actually eliminated) multiplied by the highest combined marginal federal, state and local income tax rate in effect for the taxable year, taking into account the phase-out of itemized deductions and the federal Medicare tax.

“Excise Tax Payable on Excess Parachute Payments” shall mean the tax imposed by Section 4999(a) of the Code on Excess Parachute Payments.

Within 45 days after each date on which Executive first becomes entitled to receive (whether or not then due) payments or benefits relating to a Change in Ownership or Control, the Company, at its expense, shall engage a nationally recognized law firm or a nationally recognized accounting firm, which may be the regular law firm or accounting firm of the Company (the “280G Firm”), to determine (i) which of such payments and benefits constitute Contingent Compensation Payments, (ii) the Eliminated Amount and (iii) the Eliminated Payments. To identify the Eliminated Payments, the 280G Firm shall determine the “Contingent Compensation Payment Ratio” (as defined below) for each Contingent Compensation Payment and then reduce the Contingent Compensation Payments in order beginning with the Contingent Compensation Payments with the highest Contingent Compensation Payment Ratio. For Contingent Compensation Payments with the same Contingent Compensation Payment Ratio, such Contingent Compensation Payments shall be reduced based on the time of payment of such Contingent Compensation Payments, with amounts having later payment dates being reduced first. For Contingent Compensation Payments with the same Contingent Compensation Payment Ratio and the same time of payment, such Contingent Compensation Payments shall be reduced on a pro rata basis (but not below zero) prior to reducing Contingent Compensation Payments with a lower Contingent Compensation Payment Ratio. The term “Contingent Compensation Payment Ratio” shall mean a fraction, the numerator of which is the value of the applicable Contingent Compensation Payment that must be taken into account at the change in control date for purposes of Section 280G of the Code, and the denominator of which is the present value at the change in control date of the actual amount to be received in respect of the applicable payment (e.g., in the case of equity grants, the denominator shall be determined by reference to the fair market value of the equity at the relevant dates and not in


accordance with the methodology for accelerated payments set forth in Treasury Regulation Section 1.280G-1Q/A 24(b) or (c)).

Within 30 days after each date on which Executive first becomes entitled to receive (whether or not then due) payments or benefits relating to such Change in Ownership or Control, the Company shall provide notice to Executive with reasonable detail of (i) which payments and benefits constitute Contingent Compensation Payments, (ii) the Eliminated Amount and (iii) the Eliminated Payments.

In the event of any underpayment or overpayment hereunder, as determined by the 280G Firm, the amount of such underpayment or overpayment shall within 30 days of such determination be paid to Executive or refunded to the Company, as the case may be, with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code.”

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written.

 

EXECUTIVE:

 

 

BJ’S WHOLESALE CLUB, INC.

/s/ Laura J. Sen

 

 

By:

 

/s/ Herbert J Zarkin

Laura J. Sen

 

 

 

Herbert J Zarkin

President and Chief Executive Officer

 

 

 

Chairman of the Board