Michelle Gass, Kohl’s Corp.’s former chief executive officer, left the Menomonee Falls, Wisconsin-based retailer last year with a compensation package valued at just over $9 million based on $1.24 million in salary and $7.55 million in stock awards.
Gass, currently president and CEO-in-waiting at Levi Strauss, was succeeded last February by Thomas Kingsbury, who was on the Kohl’s board since 2021 and earlier had a successful run as CEO of Burlington Stores. Last year, Kingsbury took home a compensation package valued $4.43 million, including $3.78 million in stock awards and $240,246 in salary. Gass left Kohl’s on Dec. 2.
The compensation packages of Kohl’s top executives were disclosed in a proxy statement released by the company on March 23, in advance of its annual shareholder meeting scheduled for May 10.
The meeting should be relatively non-contentious, considering on Feb. 21, when Kingsbury was announced as the next CEO, the company also disclosed that it signed a “standstill” agreement with Macellan Advisors, the shareholder activist group that pushed for Gass’ departure following several seasons of declining performance by the business and its stock price. Macellum agreed to a multiyear standstill regarding voting and other provisions, which will enable Kingsbury and his team to focus more squarely on improving the company’s performance.
Last year, Kohl’s net sales decreased 7.1 percent, or 6.6 percent on a comparable basis, to $17.2 billion. Women’s accounted for 27 percent of the volume; menswear, 22 percent; home, 16 percent; footwear, 9 percent; children’s, 13 percent, and accessories, 13 percent. National brands accounted for 64 percent of the volume, while private brands represented 36 percent.
The company lost $19 million last year compared to a net income of $938 million the year before.
Details of the standstill agreement are contained in the Kohl’s 2022 annual report. Among some of the key terms, summarized below:
- The agreement will end on the 18-month anniversary of the date Kingsbury is no longer CEO.
- The Macellum Group shall have the right to meet via virtual video conference with representatives of the company, which shall include Kingsbury, at least once per fiscal quarter in the two-week period following the release of Kohl’s quarterly earnings.
- Shares owned or beneficially owned by the Macellum Group and its affiliates will be counted in favor of each of the directors nominated by the board and against any proposals to remove any such members of the board and against any nominees for the board not recommended by the board.
- Macellum should not make any announcement or proposal with respect to, or offer, seek, propose or indicate an interest in any form of business combination, acquisition, recapitalization or other transaction relating to assets or securities of the company or any subsidiaries.
- Macellum agrees that it won’t communicate anything that might reasonably be construed as derogatory toward, or critical of, the company or any of its past or present directors, officers, affiliates, subsidiaries, employees, agents or representatives, or reveals confidential or proprietary company information.