NEO employment agreements
BJ’s Wholesale Club, Inc. has entered into employment agreements with each of Mr. Eddy,
dated as of January 30, 2011; Ms. Felice, dated May 10, 2021, Mr. Cichocki, dated as of January 30, 2020; Mr. Desroches, dated as of April 18, 2018; and Mr. Kessler dated as of May 30, 2017. The initial term of Mr. Eddy’s employment agreement was
for a period of five years, ending on January 30, 2016, after which he was to remain employed by the company subject to the termination provisions of his agreement; none of Ms. Felice’s or Messrs. Cichocki’s, Desroches’s or Kessler’s employment
agreements specified a term of employment. Mr. Eddy is subject to a 24-month post termination non-competition covenant, a 24-month post-termination non-solicitation covenant, and a perpetual confidentiality covenant. Ms. Felice and Messrs.
Cichocki, Desroches and Kessler are each subject to a 12-month post termination non-competition covenant, a 24-month post-termination non-solicitation covenant, and a perpetual confidentiality covenant.
Pursuant to each employment agreement (except for Mr. Eddy), the company has certain
obligations that become due in the event of termination. If any of Ms. Felice and Messrs. Cichocki, Desroches and Kessler are terminated by the company without cause (as defined in the applicable employment agreement), then, subject to the
executive entering into a binding and irrevocable release of claims and the executive’s continued compliance with the applicable post-termination non-competition, non-solicitation and confidentiality provisions, each executive is entitled to
receive (i) a continuation of his base salary for a period of 24 months after termination, (ii) an amount equal to the difference between the executive’s actual COBRA premium costs and the amount the executive would have paid had he continued
coverage as an employee under the company’s applicable health plans for up to 24 months, subject to earlier termination in specified instances and payable over such period, (iii) a pro rata portion of any amounts the executive would have been
entitled to receive under the company’s Annual Incentive Plan had she or he remained employed by the company until the end of the fiscal year during which termination occurred, payable in lump sum and (iv) any other payments or benefits arising
from the executive’s participation in other company plans to the extent such plans provide for post-termination employment benefits.
Upon a termination due to death or disability, in addition to the accrued amounts, subject
to the execution of a release of claims, each of the executives is eligible to receive (i) the annual cash bonus the executive would have been entitled to receive had he remained employed until the end of the fiscal year (prorated for the period
of active employment during the fiscal year), and (ii) any other payments or benefits arising from the executive’s participation in other company plans to the extent such plans provide for post-termination employment benefits.
On May 10, 2021, the company entered into an employment agreement with Mr. Eddy, in
connection with his promotion to the office of president and chief executive officer of the company, effective April 19, 2021, which superseded his previous employment agreement described above. Pursuant to the terms of Mr. Eddy’s current
employment agreement, he is entitled to an annual base salary of $1.2 million. Additionally, the compensation committee approved a fiscal year 2022 target annual cash incentive award opportunity equal to 150% of his annual base salary, and annual
long-term incentive awards in the amount of $7.0 million, consisting of 50% performance-based restricted stock units and 50% restricted stock, for a target total direct compensation for fiscal year 2022 equal to $11.0 million. Mr. Eddy’s current
employment agreement also provides that on or after April 19, 2021, to the extent Mr. Eddy’s employment is terminated without cause (as defined in such employment agreement), he is entitled to receive, in addition to any accrued amounts, subject
to his entering into a binding and irrevocable release of claims and his continue compliance with the applicable post-termination non-competition, non-solicitation and confidentiality provisions, (i) an amount equal to the sum of (a) his base
salary for a period of 12 months after termination and (b) his target annual cash bonus, payable in substantially equal installments in such manner and at such times as Mr. Eddy’s base salary was being paid immediately prior to such termination
(or if such termination occurs upon or following the occurrence of a change in control, such amount will be paid in a single lump sum); (ii) an amount equal to the difference between Mr. Eddy’s actual COBRA premium costs and the amount he would
have paid had he continued coverage as an employee under the company’s applicable health plans for up to 12 months, subject to earlier termination in specified instances, (iii) if such termination had occurred on or after July 1st of a fiscal year, a pro rata portion of the annual cash bonus to which Mr. Eddy would have been entitled had he remained employed by the company until the end of the
fiscal year, (iv) full accelerated vesting of any stock awards or stock options that are unvested and held by him as of the termination date and (v) any other payments or benefits arising from Mr. Eddy’s participation in other company plans to
the extent such plans provide for post-termination employment benefits. The employment agreement also includes provisions regarding termination due to death or disability that are the same as those contained in Mr. Eddy’s prior employment
agreement.
Equity awards
Generally, the terms of our 2018 Plan and the applicable award agreements entered into
with our NEOs provide that, as of the date of an NEO’s termination of employment, unvested options and restricted stock will automatically be forfeited, cancelled or repurchased, as applicable. However, all outstanding equity award agreements
with our NEOs provide for, upon termination due to death or disability, as applicable: (i) full vesting of all time-based awards, including restricted stock awards and stock options, (ii) pro-rata vesting of all performance-based awards,
including performance share units, based on actual performance as of the end of the applicable performance period, pro-rated based on the period of employment during the applicable performance period, and (iii) the extension of the
post-termination exercise window for vested stock options from 90 days to three years. Additionally, in the event of a change in control, as defined in the 2018 Plan, any outstanding awards granted under the 2018 Plan (other than those subject to
performance-based vesting) will continue in effect or be assumed or substituted by the successor of the company or the company, if the surviving entity, unless the compensation committee elects to (i) terminate such awards in exchange for cash,
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