Item 5.02.
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
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On August 13, 2018, RH (RH or the Company) announced
(i) the resignation of Karen Boone as President, Chief Financial Officer and Administrative Officer and (ii) the appointment of Ryno Blignaut as President, Chief Financial Officer and Administrative Officer, in each case effective
August 14, 2018.
On August 13, 2018, Ms. Boone resigned from all of her officer and director positions with RH effective August 14,
2018 other than her position as principal accounting officer (PAO) of RH.
In order to assist with an orderly handover of her responsibilities
to Mr. Blignaut, Ms. Boone has indicated that (i) she will remain in the role of PAO through the filing of RHs Form
10-Q
for the second fiscal quarter of 2018 at which time her resignation
as PAO will become effective, and (ii) following the filing of the Form
10-Q,
she will remain as an employee for a transition period through November 1, 2018 without an officer or director title.
Ms. Boone has indicated to RH that her resignation (i) is not the result of any dispute or disagreement with RHs accounting principles or
practices or financial statements and disclosures, and (ii) is motivated by personal reasons related to her wish to spend time for the next several years not working on a full time basis in order that she can have more time with her family
while her children still reside at home.
In connection with his appointment, Mr. Blignaut will receive an annual base salary of $750,000 and will
receive a grant of options to purchase 100,000 shares of the Companys common stock, which will vest ratably on each of the first five anniversaries of the grant date. Mr. Blignaut also will participate in the Companys Leadership
Incentive Program, with a target payout of 50% of his base salary and a guaranteed payout of at least $250,000 for fiscal year 2018, subject to certain conditions. Mr. Blignaut will be eligible to participate in the Companys employee
benefit programs and 401(k) plan.
RH also entered into a Compensation Protection Agreement with Mr. Blignaut, which is in substantially the same
form as those entered into with the other executive officers of RH with the title of President, the form of which was filed as Exhibit 10.11 to RHs Annual Report on Form
10-K
for the fiscal year ended
February 3, 2018.
The Compensation Protection Agreement provides generally that, in the event of termination of Mr. Blignauts employment
by the Company without Cause or in the event of termination of employment by Mr. Blignaut for Good Reason (as such terms are defined in the Compensation Protection Agreement), the Company would pay severance in an amount
equal to base salary compensation for a compensation protection period of 12 months after employment termination so long as Mr. Blignaut does not engage in certain restricted activities during such time period. The Compensation Projection
Agreement also provides for the payment of certain costs related to COBRA benefits during such compensation protection period and the payment of a prior year bonus or a pro rata amount of current year bonus based on the date of employment
termination and the Company achieving the performance metrics in any such bonus arrangement. The foregoing is only a summary of the material terms of the Compensation Protection Agreement and does not purport to be complete, and is qualified in its
entirety by reference to the form of Compensation Protection Agreement, a copy of which is filed as Exhibit 10.11 to RHs Annual Report on Form
10-K
for the fiscal year ended February 3, 2018 and is
incorporated by reference herein.
No family relationship exists between Mr. Blignaut and any of RHs directors or executive officers.
There are no related-party transactions in which Mr. Blignaut or any of his immediate members has an interest that would require disclosure under Item
404(a) of Regulation
S-K.
A copy of the press release announcing the appointment of Mr. Blignaut and the
resignation of Ms. Boone is attached hereto as Exhibit 99.1.