Former Just Salad CFO Stefan Boyd is suing the restaurant chain for $1.2 million he claims he’s owed tied to a separation agreement, arguing he lost out on the funds after doing too good a job for the company, according to a complaint filed last week in New York’s Manhattan Supreme Court.
The suit, filed March 27 by law firm Parker Pohl LLP on Boyd’s behalf, contends that Boyd, who left the company in 2023, was instrumental in helping Just Salad achieve a $1 billion valuation after a $200 million funding round in February — and that under the terms of Boyd’s separation agreement with the New York-based Just Salad, that valuation entitles Boyd to a $1.2 million payout.
The 39-page complaint also alleges that following the February raise, Just Salad’s CEO Kenner chose to “exploit” terminology in the separation agreement, “by arguing it may technically be read to deprive Boyd of any compensation at all based on language that, in effect, presumed a significantly lower valuation.”
“Stefan put his heart and soul into his work, and as a result, the Company’s value has exploded,” David Pohl,co-founder of Parker Pohl LLP told CFO Dive in an emailed statement. “It never could have occurred to him that, if his work proved far more valuable than anyone ever dreamed, the Company would claim a right to stiff him based on a mistaken contractual definition that, they argue, does not require a payment when the growth is this strong.
Just Salad is actually refusing to pay Stefan because his work created too much value and helped the company raise too much money. Just Salad apparently thinks it’s OK to treat a dedicated employee this way but we're confident the court will see it differently.”
Boyd’s former employer, however, contends that the terms as detailed in the separation agreement for such a payout were just not met.
“Stefan Boyd left the company in March of 2023 with a clear separation agreement that he helped craft and negotiate, the terms of this separation agreement were clear and simply not met, and therefore did not stipulate a payment,” a Just Salad spokesperson told CFO Dive via email. “The accusations and purported statements made are categorically false, and we look forward to vigorously defending these allegations."
Valuation tug-of-war
The terms of Boyd’s separation agreement — which is not included in the suit and which his attorneys declined to provide — are at the crux of the dispute, which revolves around the March 17, 2023 agreement, its relationship with a company equity plan, and the unprecedented unicorn status reached by Just Salad with its February raise.
An alum of Le Pain Quotidien and JPMorgan, Boyd joined Just Salad in 2019 with the express goal of positioning the company to execute on a planned capital raise at a higher valuation, according to the complaint. During his tenure as CFO, Boyd deferred much of his compensation into an employee equity plan — which promised participants future payouts associated with just such a raise.
In the face of a “strained” relationship with Just Salad CEO Nick Kenner, Boyd left the company in April 2023; his separation agreement stipulated that, though Boyd would no longer participate in the equity plan, he would receive a “substantial payment” once the stated raise was finalized, the complaint alleges.
Boyd currently serves as CFO for Rosa Mexicano Restaurants, taking the seat in April 2023, according to his LinkedIn profile. Goldman Sachs alum Jared Garber was appointed as his successor.
Eighteen months after Boyd’s departure, Just Salad completed its February raise at a “staggering” valuation of $1 billion, which required it to sell less equity than it had previously anticipated, according to the complaint.
While other participants in the company’s equity plan received payments, however, Boyd received a letter informing him that, rather than the $1.2 million, he was entitled only to receive a $150,000 payout following the capital raise — owing to the fact that Just Salad’s capital raise required it to sell only 20% of its equity, rather than the 30% that would have acted as a “trigger” for a distribution event under both the equity plan and the separation agreement, the complaint alleges.
“Indeed, Defendant Just Salad has adopted an absurd position: Boyd should be deprived of the intended reward for his work…because the value he created was too great; he did his job too well; the foundation he built was too strong; the Company grew too much and raised too much money (all while parting with too little of its equity),” the complaint alleges.
As well as the $1.2 million, Boyd is also seeking $5 million in damages — a figure he would have collected if he still participated in the company’s equity plan following the February raise, according to the suit, which cites alleged comments by CEO Kenner claiming the top executive was aware of that fact.
“Despite also admitting that paying Boyd the lesser $1.2 million under the separation agreement is warranted by the ‘spirit of the deal,’ Kenner says the Company does not owe Boyd a penny,” the complaint reads, referring to other alleged comments by the CEO. “Instead, Kenner says Boyd should take satisfaction in his work and be proud: ‘you should wear it on your sleeve professionally for the rest of your life,’ Kenner said.”
