Ex-CEO still got a hefty check

Eddie Bauer Chief Executive Fabian Mansson may be out of a job, but he has enough money to ponder the future — indefinitely.

Mansson, who resigned from the embattled outdoor-apparel retailer on Feb. 9, will walk away from the company with nearly $6 million in separation benefits, according to a regulatory filing.

The Redmond-based retailer announced Mansson's resignation the day after its shareholders voted down a proposal to sell the company to a pair of buyout firms for $285 million.

The proposal drew 44 percent of the outstanding shares, with 37 opposed — lower than the needed majority, most likely because the premium per share was too low.

Had the proposal received a majority vote, Mansson would have received $10.8 million in separation benefits.

Based on a 2005 employment agreement, Eddie Bauer said Thursday in a filing that it would continue to pay Mansson a $980,000 annual base salary and employee benefits, including life and health insurance, through May 9, 2009.

Mansson also receives:

• Bonus payments of $980,000 for 2007 and 2008, plus $346,356 in 2007.

• Accelerated vesting of his 133,334 shares, which at Thursday's closing price of $9.03 were valued at $1.2 million.

• Reimbursement for up to $35,000 in outplacement services.

• Expenses related to the sale of his principal home, closing costs for the purchase of a new home in Sweden and relocation expenses to Sweden.

• Payment of the first six months of his base salary in a lump sum on Aug. 10.

Eddie Bauer became an independent company in June 2005 for the first time in 35 years after parent Spiegel Group filed for bankruptcy.

Under its reorganization plan, Spiegel transferred its stake in Eddie Bauer to its creditors as the newly formed Eddie Bauer Holdings. The company began publicly trading its stock last year.

In a proxy filing, the board of directors endorsed the sale, saying it would be difficult to continue to operate Eddie Bauer on a stand-alone basis, given a substantial drop in sales and the inability of several management teams to execute a turnaround.

Net merchandise sales have declined since 2000, and same-store sales — a key measure of the performance of stores open a year or more — have fallen in 23 of the previous 27 quarters, the proxy said.

In lieu of a sale, the proxy statement said, Eddie Bauer would have to either take on more debt or refinance its existing debt on unfavorable terms. The company's board has not publicly disclosed a reorganization plan.

In the meantime, board member Howard Gross will run the company as interim CEO while the board searches for a permanent replacement. Gross, a retail-apparel-industry veteran, was formerly president and CEO of Limited and Victoria's Secret stores.

Critics say Eddie Bauer took its eye off its core customer, chasing a younger demographic that ultimately rejected the outdoor retailer.

The company, whose founder Eddie Bauer created the down parka, has sharpened focus on its authority in the outerwear category, as well as on apparel designed to appeal to and fit its core customers, ages 30 to 54.

Eddie Bauer's shares closed Thursday at $9.03, up 13 cents.

Monica Soto Ouchi: 206-515-5632 or msoto@seattletimes.com