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Preliminary Proxy Statement
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Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Under Rule 14a-12
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No fee required
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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Title of each class of securities to which transaction applies:
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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Proposed maximum aggregate value of transaction:
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Total fee paid:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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Amount previously paid:
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Form, Schedule or Registration Statement No.:
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Filing Party:
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Date Filed:
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Ray M. Robinson
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John W. Robinson III
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Chairman of the Board
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President and Chief Executive Officer
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1.
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To elect eight directors to serve for a term expiring at the 2020 Annual Meeting of Shareholders.
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2.
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To vote on a non-binding, advisory resolution approving Aaron’s executive compensation.
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3.
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To adopt and approve the Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan.
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4.
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To ratify the appointment of Ernst & Young LLP as Aaron’s independent registered public accounting firm for 2019.
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5.
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To transact such other business as may properly come before the meeting or any adjournment or postponement thereof.
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BY ORDER OF THE BOARD OF DIRECTORS
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Robert W. Kamerschen
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Executive Vice President, General Counsel,
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Chief Administrative Officer & Corporate Secretary
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Atlanta, Georgia
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March 28, 2019
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Proxy Summary
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Matters To Be Voted On
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Proposal 1: Election of Eight Directors
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Proposal 2: Advisory Vote to Approve Executive Officer Compensation
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Proposal 3: Approval of the Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan
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Proposal 4: Ratification of the Appointment of Ernst & Young LLP as our Independent Registered Public Accounting Firm
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Governance
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Nominees to Serve as Directors
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Executive Officers Who Are Not Directors
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Composition, Meetings and Committees of the Board of Directors
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Assessment of Director Candidates and Required Qualifications
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Shareholder Recommendations and Nominations for Election to the Board
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Board Leadership Structure
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Board of Directors and Committee Evaluations
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Board Role in Risk Oversight
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Social and Environmental Responsibility
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Board and Workplace Diversity
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Compensation Committee Interlocks and Insider Participation
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Section 16(a) Beneficial Ownership Reporting Compliance
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Non-Management Director Compensation in 2018
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Stock Ownership Guidelines
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Compensation Discussion and Analysis
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Executive Summary
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Objectives of Executive Compensation
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Compensation Process Summary for 2018
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Benchmarking
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Components of the Executive Compensation Program
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Base Salary
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Annual Cash Incentive Awards
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Long-Term Equity Incentive Awards
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Executive Compensation Policies
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Executive Benefits & Perquisites
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Employment Agreements and Other Post Termination Protections
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Policy on Compensation Tax Deductibility
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Compensation Committee Report
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Executive Compensation
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Summary Compensation Table
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Grants of Plan-Based Awards in 2018
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Employment Agreements with Named Executive Officers
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Aaron's, Inc. 2015 Equity and Incentive Plan
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Amended and Restated 2001 Stock Option and Incentive Award Plan
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Aaron's, Inc. Employee Stock Purchase Plan
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Outstanding Equity Awards at 2018 Fiscal Year-End
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Options Exercised and Stock Vested in 2018
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Pension Benefits
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Nonqualified Deferred Compensation as of December 31, 2018
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Potential Payments Upon Termination or Change in Control
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Securities Authorized for Issuance under Equity Compensation Plans
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CEO Pay Ratio Disclosure
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Audit Committee Report
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Audit Matters
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Fees Billed in the Last Two Fiscal Years
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Approval of Auditor Services
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Beneficial Ownership of Common Stock
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Certain Relationships and Related Transactions
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Policies and Procedures Dealing with the Review, Approval and Ratification of Related Party Transactions
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Related Party Transactions
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Questions and Answers About Voting and the Annual Meeting
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Additional Information
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Shareholder Proposals for 2020 Annual Meeting of Shareholders
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Householding of Annual Meeting Materials
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Communicating with the Board of Directors and Corporate Governance Documents
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Other Action at the Meeting
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Appendix A - Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan
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Date and Time
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May 8, 2019, at 9:00 a.m., local time
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Place
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The Georgian Club
100 Galleria Parkway SE, 17th Floor
Atlanta, Georgia 30339
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Record Date
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March 4, 2019
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Voting
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Shareholders as of the record date are entitled to vote at the Annual Meeting. Each share of common stock is entitled to one vote for each director nominee and one vote for each of the other proposals to be voted on at the Annual Meeting.
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Admission
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Attendance at the Annual Meeting will be limited to shareholders as of the record date or their authorized representatives.
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Proposal
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Board Recommendation
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Elect eight directors to serve for a term expiring at the 2020 Annual Meeting of Shareholders
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“FOR” each director nominee
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Vote on a non-binding advisory resolution approving Aaron’s executive compensation
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“FOR”
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Approve the Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan
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“FOR”
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Ratify the appointment of Ernst & Young LLP as Aaron’s independent registered public accounting firm for 2019
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“FOR”
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•
|
We reported record revenues of
$3.8 billion
in
2018
compared to
$3.4 billion
in
2017
, driven by strong growth in our Progressive Leasing segment.
|
•
|
Progressive Leasing achieved record revenues of nearly
$2.0 billion
in
2018
, an
increase
of
27.6%
over
2017
. Progressive Leasing’s revenue growth is due to a
23.2%
increase in total invoice volume, which was generated through an increase in invoice volume per active door.
|
•
|
Consolidated earnings before income taxes ("EBIT")
increased
to a record
$252.2 million
compared to
$239.6 million
in
2017
, driven by growth at Progressive Leasing, partially offset by declines from our Aaron's Business.
|
•
|
During 2018, we acquired substantially all of the assets of the store operations of
152
Aaron's-branded franchised stores. We believe the acquisitions are benefiting our omnichannel platform through added scale, strengthening our presence in certain geographic markets, enhancing operational control, including compliance, and enabling us to execute our business transformation initiatives on a broader scale.
|
•
|
We generated cash from operating activities of
$356.5 million
in
2018
and had
$15.3 million
in cash and
$373.0 million
available on our revolving credit facility as of December 31,
2018
.
|
•
|
We
returned
$175.0 million
to our shareholders in
2018
through the repurchase of
3.7 million
shares and the payment of quarterly cash dividends. We have paid dividends for 31 consecutive years.
|
•
|
We continued optimizing our Aaron's store-based operations by implementing various cost efficiency and lease-margin-improvement initiatives, including optimizing merchandising and promotional strategies and continuing store consolidations.
|
•
|
We continued the development of management talent across our entire organization.
|
•
|
Our stock price increased 7% during the year, from January 2, 2018 to December 31, 2018.
|
•
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We further improved the Company’s compliance programs and achieved important compliance objectives for the year, including objectives related to information security and compliance training.
|
•
|
Messrs. John W. Robinson III and Steven A. Michaels earned annual cash incentive awards of 103.6% of target based on Company-wide financial performance and the achievement of compliance-related goals. Mr. Douglas A. Lindsay earned an annual cash incentive award of 104.4% of target based on Aaron’s Business results for financial performance and compliance-related goals. Messrs. Ryan K. Woodley and Curtis L. Doman earned annual cash incentive awards of 104.9% of target, based on Progressive’s results for financial performance and compliance-related goals.
|
•
|
Our named executive officers also earned awards under the performance share component of our 2018 long-term incentive program. This component represents 50% of the annual grant value made under our 2018 long-term incentive program to our NEOs. Messrs. Robinson and Michaels earned awards at 99.0% of target, based on the Company’s overall performance. Mr. Lindsay earned awards at 101.0% of target, based on the financial performance of our Aaron’s Business and the Company as a whole. Messrs. Woodley and Doman earned awards at 99.9% of target based on the financial performance of Progressive and the Company as a whole. As of the
March 4, 2019
record date, the value realized from these awards was greater than the corresponding grant date target values in light of the subsequent increase in our stock price. Further, for the stock options and time-based restricted stock awards that comprise the remainder of the annual grant for our named executive officers, our stock price increase as of
March 4, 2019
resulted in award values that were also greater than the grant date award values.
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Nominee
|
Age
|
Occupation
|
Independent
|
Joined Our Board
|
Kathy T. Betty
|
63
|
Former Owner and Chief Executive Officer
Atlanta Dream (WNBA team) |
Yes
|
August 2012
|
Douglas C. Curling
|
64
|
Managing Principal
New Kent Capital LLC and
New Kent Consulting LLC
|
Yes
|
January 2016
|
Cynthia N. Day
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53
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President and Chief Executive Officer
Citizens Bancshares Corporation and Citizens Trust Bank |
Yes
|
October 2011
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Curtis L. Doman
|
46
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Chief Product Officer Progressive
|
No
|
August 2015
|
Walter G. Ehmer
|
53
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President and Chief Executive Officer Waffle House, Inc.
|
Yes
|
May 2016
|
Hubert L. Harris, Jr.
|
75
|
Former Chief Executive Officer
Invesco North America
|
Yes
|
August 2012
|
John W. Robinson III
|
47
|
President and Chief Executive Officer
Aaron’s, Inc. |
No
|
November 2014
|
Ray M. Robinson
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71
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Former President for the Southern Region AT&T
|
Yes
|
November 2002
|
•
|
Increase the remaining number of shares of common stock available for issuance by 3,000,000 shares to a total of 3,722,323 shares; and
|
•
|
Revise the Existing 2015 Plan in light of amendments to Internal Revenue Code Section 162(m) in the Tax Act to remove references to and provisions implemented in order to comply with Internal Revenue Code Section 162(m), including the individual limits on the number of awards that may be granted in any one fiscal year to any participant (other than the limitation on the number of options and SARs (as defined below) that can be granted in any one fiscal year).
|
Name
|
|
Title
|
|
2018 Incentive Award Value on Grant Date
|
|
# of Options Granted
|
|
# of RSAs Granted
|
|
# of RSUs Granted
|
|
# of PSUs Granted
|
John W. Robinson III
|
|
Chief Executive Officer
|
|
$5,344,806
|
|
87,330
|
|
27,510
|
|
—
|
|
55,020
|
Steven A. Michaels
|
|
Chief Financial Officer & President of Strategic Operations
|
|
1,445,849
|
|
23,640
|
|
7,440
|
|
—
|
|
14,880
|
Ryan K. Woodley
|
|
Chief Executive Officer, Progressive
|
|
2,468,917
|
|
40,320
|
|
12,720
|
|
—
|
|
25,410
|
Douglas A. Lindsay
|
|
President, Aaron's Business
|
|
1,390,272
|
|
22,680
|
|
7,170
|
|
—
|
|
14,310
|
Curtis L. Doman
|
|
Chief Product Officer, Progressive
|
|
1,466,407
|
|
23,940
|
|
7,560
|
|
—
|
|
15,090
|
Executive Officer Group
|
|
|
|
12,912,403
|
|
210,900
|
|
66,510
|
|
—
|
|
132,900
|
Non-Executive Directors Group
|
|
|
|
|
|
—
|
|
—
|
|
22,008
|
|
—
|
Non-Executive Officer Employee Group Total
|
|
|
|
15,673,433
|
|
150,150
|
|
141,588
|
|
—
|
|
138,210
|
|
|
Kathy T. Betty, 63,
has served as a director of the Company since August 2012. From 2009 until 2011, Ms. Betty was the owner and Chief Executive Officer of the Atlanta Dream of the WNBA. She also founded The Tradewind Group, an incubator company, where she worked until 2007. Her other experience includes serving as Executive Vice President and Partner of ScottMadden from 1993 to 2000, where she worked on international mergers and acquisitions, and working at Ernst & Young LLP from 1989 to 1993, including serving as one of the first women admitted to the partnership.
Among other qualifications, Ms. Betty brings over 30 years of business management and consultancy experience to our Board of Directors. Her leadership positions in the Atlanta community, include serving on the boards of the Chick-fil-A Foundation, the Alexander-Tharpe Fund, Georgia Institute of Technology, and the Board of Councilors of the Carter Center as well as serving on the Board of Trustees for the Georgia Institute of Technology Athletic Association and Board of Advisors for Synergy Laboratories and Sure Med Compliance. She has also served on the boards of the Children’s Health Care of Atlanta Foundation, YMCA of Metropolitan Atlanta and Big Brothers Big Sisters of Atlanta. These positions provided her with management, entrepreneurial, financial and accounting experience, which are utilized by our Board of Directors. These skills and experience qualify her to serve on our Board of Directors.
|
|
|
Douglas C. Curling
, 64, has served as a director of the Company since January 2016. Since March 2009, Mr. Curling has been the managing principal of New Kent Capital LLC, a family-run investment business, and New Kent Consulting LLC, a privacy and mergers and acquisitions consulting business. From 1997 until September 2008, Mr. Curling held various executive positions at ChoicePoint Inc., a provider of identification and credential verification services that was sold to Reed Elsevier in 2008, including serving as President from April 2002 to September 2008, as Chief Operating Officer from 1999 to September 2008 and as Executive Vice President, Chief Financial Officer and Treasurer from 1997 to May 1999. Mr. Curling also served as a director of ChoicePoint Inc. from May 2000 to September 2008. Mr. Curling currently serves on the Board of Directors of CoreLogic, a New York Stock Exchange listed company providing global property information, analytics and data-enabled services to financial services organizations and real estate professionals.
Among other qualifications, Mr. Curling brings substantial experience in managing and operating businesses with privacy, data analytics and other data-enabled matters to our Board of Directors. His prior service as a chief financial officer provides him with valuable accounting and financial expertise, and his consulting experience provides him with significant mergers and acquisitions expertise, all of which is utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
|
|
Cynthia N. Day, 53,
has served as a director of the Company since October 2011. Ms. Day is currently President and Chief Executive Officer of Citizens Bancshares Corporation and Citizens Trust Bank. She served as Chief Operating Officer and Senior Executive Vice President of Citizens Trust Bank from 2003 to January 2012 and served as its acting President and Chief Executive Officer from January 2012 to February 2012. Ms. Day previously served as the Executive Vice President and Chief Operating Officer and in other capacities of Citizens Federal Savings Bank of Birmingham from 1993 until its acquisition by Citizens Trust Bank in 2003 and previously served as an audit manager for KPMG. She currently serves on the Board of Directors of Primerica, Inc., Citizens Bancshares Corporation and its subsidiary, Citizens Trust Bank. As of January 2017, Citizens Bancshares Corporation's stock is traded only on over-the-counter markets. Its subsidiary, Citizens Trust Bank, is not a publicly traded company. Ms. Day has also served as a member of the Board of Directors of the National Bankers Association, the Georgia Society of CPAs, the University of Alabama Continuing Education Advisory Board and the United Negro College Fund.
Among other qualifications, Ms. Day brings significant management and financial experience to our Board of Directors. Her experience in multiple senior executive leadership positions and service on other boards, provide her with accounting and financial expertise, which are utilized by our Board of Directors. These skills and experiences qualify her to serve on our Board of Directors.
|
|
Curtis L. Doman
, 46, has served as a director of the Company since August 2015. Mr. Doman currently serves as the Chief Product Officer of the Company’s Progressive segment, and is a co-founder of Progressive. Previously, he served as Chief Technology Officer of Progressive from 1999 until December 2017. He was also President of IDS, Inc. from September 1993 until October 2015.
Among other qualifications, Mr. Doman brings significant experience in technology and data analytics matters to our Board of Directors. Mr. Doman’s intimate knowledge of our Progressive segment, including as the creator of the dynamic decision-making engine used by our Progressive segment in evaluating underwriting criteria for our lease products, is utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
|
|
Walter G. Ehmer
, 53, has served as a director of the Company since May 2016. Mr. Ehmer is currently the President and Chief Executive Officer of Waffle House, Inc., or “Waffle House,” a position he has held since 2012. Mr. Ehmer has held various positions with Waffle House since joining the company in 1992 as a senior buyer in the purchasing department, including most recently serving as its President and Chief Operating Officer from 2006 until 2012 and as Chief Financial Officer from 1998 until 2002. Mr. Ehmer previously served as a member of the Georgia Tech Industrial Engineering Advisory Board, the Georgia Tech Alumni Association Board of Trustees and the Georgia Tech President’s Advisory Board. Mr. Ehmer is also a past chairperson of the Georgia Tech Alumni Association and currently serves as a member of the board of the Georgia Tech Foundation. Mr. Ehmer also serves on the boards of the City of Atlanta Police Foundation, the Metro Atlanta Chamber of Commerce, and Children's Healthcare of Atlanta Foundation.
Among other qualifications, Mr. Ehmer brings significant management and financial experience to our Board of Directors. His experience in multiple senior executive leadership positions, including with responsibility for accounting-related matters, provide him with managerial and financial expertise that is utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
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Hubert L. Harris, Jr.
, 75, has served as a director of the Company since August 2012. Since 1992, Mr. Harris has owned and operated Harris Plantation, Inc., a cattle, hay and timber business. Mr. Harris has also served as a trustee for SEI mutual funds since 2008. Mr. Harris previously served as CEO of Invesco North America, CFO of Invesco PLC and Chairman of Invesco Retirement Services, and served on the Board of Directors of Invesco from 1993 to 2004. From 1988 to 2005, Mr. Harris was President and Executive Director of the International Association for Financial Planning. Mr. Harris also served as the Assistant Director of the Office of Management and Budget in Washington, D.C. from 1977 to 1980. Mr. Harris is on the Board of Councilors of the Carter Center, and he previously served as chair of the Georgia Tech Foundation and chair of the Georgia Tech Alumni Association.
Among other qualifications, Mr. Harris brings a strong financial background and extensive business experience to our Board of Directors. His service on numerous for-profit and non-profit boards and management experience provide him with governance and financial expertise, which are utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
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John W. Robinson III,
47, has been a director of the Company since November 2014 when he was named the Chief Executive Officer of the Company. Mr. Robinson was also named President of the Company as of February 2016. From 2012 to November 2014, Mr. Robinson served as the Chief Executive Officer of Progressive Finance Holdings, LLC, which was acquired by Aaron’s, Inc. in April 2014. Prior to working at Progressive, he served as the President and Chief Operating Officer of TMX Finance LLC, or “TMX Finance.” He joined TMX Finance as Chief Operating Officer in 2004 and was appointed President in 2008. TMX Finance filed a voluntary Chapter 11 bankruptcy proceeding in April 2009 from which it emerged in April 2010. Prior to working at TMX Finance, he worked in the investment banking groups at Morgan Stanley, Lehman Brothers and Wheat First Butcher Singer.
Among other qualifications, Mr. Robinson brings significant operational and financial experience to our Board of Directors. His considerable experience in senior management, and his leadership and intimate knowledge of our business, including our Progressive segment in particular, provide him with strategic and operational expertise generally and for the Company specifically, which are utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
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Ray M. Robinson,
71, has served as a director of the Company since November 2002 and has been our Chairman since April 2014. From November 2012 until his appointment as Chairman, Mr. Robinson was the Company’s independent lead director. Mr. Robinson started his career at AT&T in 1968, and prior to his retirement in 2003, he held several executive positions, including President of the Southern Region, its largest region, President and Chief Executive Officer of AT&T Tridom, Vice President of Operations for AT&T Business Customer Care, Vice President of AT&T Outbound Services, and Vice President of AT&T Public Relations. Mr. Robinson is also a director of Acuity Brands, Inc., a lighting solutions company, American Airlines Group Inc., a holding company operating various commercial airlines (including American Airlines and US Airways), and Fortress Transportation and Infrastructure Investors LLC, an investor in infrastructure and equipment for the transportation of goods and people, all of which are public companies. Since 2003, Mr. Robinson has also served as a director and non-executive Chairman of Citizens Bancshares Corporation and its subsidiary, Citizens Trust Bank, the largest African American-owned bank in the Southeastern United States and the nation’s second largest. As of January 2017, Citizens Bancshares Corporation's stock is traded only on over-the-counter markets. Its subsidiary, Citizens Trust Bank, is not a publicly traded company. Mr. Robinson previously served as a director of RailAmerica, Inc. from 2010 to 2012. Mr. Robinson has also been Vice Chairman of the East Lake Community Foundation in Atlanta, Georgia since November 2003.
Among other qualifications, Mr. Robinson brings experience in senior management and board service for numerous public companies to our Board of Directors. His service on the boards of a number of organizations of varying sizes provides him with extensive operational skills and governance expertise, which are utilized by our Board of Directors. These skills and experiences qualify him to serve on our Board of Directors.
|
|
|
|
Name (Age)
|
|
Position with the Company and Principal Occupation During
the Past Five Years
|
Robert W. Kamerschen (51)
|
|
Chief Administrative Officer since February 2016 and Executive Vice President, General Counsel and Corporate Secretary since April 2014. Previously, Mr. Kamerschen served as Senior Vice President and General Counsel from June 2013 and also as Corporate Secretary from November 2013. Before joining the Company, Mr. Kamerschen worked at information solution provider Equifax Inc. from 2008 through 2013, serving in multiple executive positions and most recently as its U.S. Chief Counsel, Senior Vice President and Chief Compliance Officer. Mr. Kamerschen began his legal career in 1994 in the Atlanta office of the international law firm Troutman Sanders LLP.
|
Douglas A. Lindsay (48)
|
|
President of Aaron’s Business since February 2016. Prior to joining the Company, Mr. Lindsay served as the Executive Vice President and Chief Operating Officer at ACE Cash Express from February 2012 to January 2016. Previously Mr. Lindsay also served as the Executive Vice President and Chief Financial Officer from June 2007 to February 2012 and the Vice President, Finance and Treasurer from February 2005 to June 2007 for ACE Cash Express.
|
Steven A. Michaels (47)
|
|
Chief Financial Officer and President of Strategic Operations since February 2016. Mr. Michaels previously served as President from April 2014 until February 2016, Vice President Strategic Planning & Business Development from 2013 until April 2014, Vice President, Finance from 2012 until April 2014 and Vice President, Finance, Aaron’s Sales & Lease Ownership Division from 2008 until 2011.
|
Robert P. Sinclair, Jr. (57)
|
|
Vice President, Corporate Controller since 1999.
|
Ryan K. Woodley (42)
|
|
Chief Executive Officer of Progressive Finance Holdings, LLC since January 2015. Mr. Woodley joined Progressive Finance Holdings, LLC as Chief Operating Officer and Chief Financial Officer in June of 2013. Prior to that, he was Chief Operating Officer and Chief Financial Officer at DigiCert, a digital security certificate provider which was sold to TA Associates in November 2012.
|
Director
|
|
Audit
Committee* |
|
Compensation
Committee |
|
Nominating and
Corporate
Governance Committee |
Kathy T. Betty
|
|
|
|
Member
|
|
(Chair)
|
Douglas C. Curling
|
|
Member
|
|
(Chair)
|
|
|
Cynthia N. Day
|
|
(Chair)
|
|
Member
|
|
|
Walter G. Ehmer
|
|
Member
|
|
|
|
Member
|
Hubert L. Harris, Jr.
|
|
Member
|
|
|
|
Member
|
Ray M. Robinson
|
|
|
|
Member
|
|
Member
|
Robert H. Yanker
|
|
Member
|
|
|
|
Member
|
Number of Meetings in Fiscal Year 2018
|
|
10
|
|
6
|
|
4
|
|
*
|
Four members of the Audit Committee have been designated as an “audit committee financial expert” as defined by Securities and Exchange Commission, or "SEC", regulations.
|
•
|
Entering into our second three-year national partnership with the Boys and Girls Clubs of America, under which we have committed $5 million of funding and other resources;
|
•
|
Committing to complete 53 Boys and Girls Clubs’ teen center makeovers by 2021, including donating $20,000 of merchandise to each of those teen centers;
|
•
|
Being the primary sponsor of the Boys and Girls Clubs’ National Keystone Conference, a character and leadership development event that brings together 2,500 club members and advisors from around the country;
|
•
|
Providing financial support and internship programs to 20 students of Morehouse College, a historically black college, through 2021, underwritten by a gift of $1 million;
|
•
|
Donating more than $500,000 to local, regional and national charities in 2018, through Progressive’s ProgReach program, and enabling Progressive employees to assemble and donate comfort kits for patients at children’s hospitals in Salt Lake City and Phoenix, volunteer in soup kitchens, host food drives, and donate tablets and school supplies to over 250 students in the Big Brothers Big Sisters Mentor 2.0 college readiness program;
|
•
|
Providing community-level assistance to veterans, youth organizations and community centers through in-kind donations from our Aaron’s Community Outreach Program, which is the local, store-based giving initiative of the Aaron’s Business;
|
•
|
Contributing merchandise to the Warrick Dunn Charities’ and Kurt Warner’s First Things First Foundation’s “Home for the Holidays” program, which assists single parents in becoming first-time homeowners, through a partnership with Habitat for Humanity;
|
•
|
Matching employee donations to not-for profit organizations within the areas of arts and culture, health and human services, civic and community concerns, and education, on a dollar-for-dollar basis, up to $1,000 per employee; and
|
•
|
Sponsoring numerous events during 2018 that allowed employees to volunteer for non-profit organizations during paid work days, including more than 200 Progressive employees renovating a non-profit child care facility near Salt Lake City and hundreds of Aaron’s employees volunteering at food banks in the Atlanta area each quarter.
|
•
|
Implementing a comprehensive waste audit program at our manufacturing facilities, which covers all materials we use in our manufacturing processes;
|
•
|
Adopting waste-reduction programs that require the re-use or recycling of scrap material, including paper, plastic, foam, fabric, wood, metal and cardboard, resulting in the recycling of approximately 10 million pounds of materials annually;
|
•
|
Reducing the amount of materials our manufacturing facilities send to landfills by more than 90% since 2009;
|
•
|
Encouraging employees to bring certain waste to our facilities, to facilitate the recycling of those materials, resulting in the recycling of thousands of plastic bottles annually;
|
•
|
Using foam in the manufacturing of our bedding and furniture products, which does not contain lead, mercury, formaldehyde or CFCs, and which contains soy-based polyols, instead of those derived from fossil fuels;
|
•
|
Replacing metal halide lighting with more energy efficient Versabay lighting, and using skylight panels in approximately 600,000 square feet of our manufacturing space, to further reduce energy demand;
|
•
|
Providing recycling containers at our headquarters buildings, through which we recycle aluminum, cardboard, paper and plastic;
|
•
|
Locating our Progressive headquarters in a building that is LEED Silver Certified, with Daylight Harvesting and locating our Aaron's headquarters in a building that is Energy Star Certified;
|
•
|
Replacing approximately 35% of our delivery fleet with lighter, more fuel-efficient vehicles over the past 5 years;
|
•
|
Improving the average miles-per-gallon fuel efficiency of our delivery vehicles by approximately 9% over the past 5 years; and
|
•
|
Adopting a strict no-idling policy for our fleet drivers.
|
Name
|
|
Fees Earned or
Paid in Cash
($)
|
|
Stock Awards
(1)
($)
|
|
Total
($) |
|||
Kathy T. Betty
(2), (3)
|
|
80,000
|
|
|
125,000
|
|
|
205,000
|
|
Douglas C. Curling
(2), (4)
|
|
90,000
|
|
|
125,000
|
|
|
215,000
|
|
Cynthia N. Day
(2), (5)
|
|
95,000
|
|
|
125,000
|
|
|
220,000
|
|
Walter G. Ehmer
(2), (6)
|
|
75,000
|
|
|
125,000
|
|
|
200,000
|
|
Hubert L. Harris, Jr.
(2), (7)
|
|
80,000
|
|
|
125,000
|
|
|
205,000
|
|
Ray M. Robinson
(2), (8)
|
|
175,000
|
|
|
125,000
|
|
|
300,000
|
|
Robert H. Yanker
(2), (9)
|
|
75,000
|
|
|
125,000
|
|
|
200,000
|
|
(1)
|
Represents the grant date fair value of stock awards pursuant to Financial Accounting Standards Board Codification Topic 718.
|
(2)
|
As of
December 31, 2018
, each of our non-executive directors, held 3,144 units of restricted stock subject to vesting, which was the number of units of restricted stock granted to them in January 2018 and May 2018. As of
December 31, 2018
, Mr. Robinson also held 3,000 vested options, which expire in February 2020 and have an exercise price of $19.92.
|
(3)
|
Includes
$21,250
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
.
|
(4)
|
Includes
$22,500
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
.
|
(5)
|
Includes
$23,750
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
.
|
(6)
|
Includes
$18,750
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
that Mr. Ehmer deferred under the Company's Nonqualified Deferred Compensation Plan and
$56,250
in compensation Mr. Ehmer deferred under the Company's Nonqualified Deferred Compensation Plan.
|
(7)
|
Includes
$18,750
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
.
|
(8)
|
Includes
$43,750
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
.
|
(9)
|
Includes
$18,750
in fees earned for services in the fourth quarter of
2018
which will be paid in
2019
that Mr. Yanker deferred under the Company's Nonqualified Deferred Compensation Plan and
$56,250
in compensation Mr. Yanker deferred under the Company's Nonqualified Deferred Compensation Plan.
|
Named Executive Officer
|
2018 Position
|
John W. Robinson III
|
President and Chief Executive Officer
|
Steven A. Michaels
|
Chief Financial Officer and President of Strategic Operations
|
Ryan K. Woodley
|
Chief Executive Officer, Progressive
|
Douglas A. Lindsay
|
President, Aaron’s Business
|
Curtis L. Doman
|
Chief Product Officer, Progressive
|
2018 Company Performance Results
|
2018 Executive Pay Results
|
•
Consolidated Revenues were $3,829 million, which was an increase of 13% from 2017
|
•
Short-term incentive awards were earned at a level between 104% and 105% of Target
|
•
Consolidated EBIT was $252 million, which was an increase of 5% from 2017
|
•
Performance Share Units (PSUs) were earned at a level between 99% and 101% of Target
|
•
Consolidated Adjusted EBITDA
1
was $386 million, which was an increase of 7% from 2017
|
•
RSAs granted in 2018 and RSUs granted in prior years increased in value above their grant date value given the increase in the stock price as of the March 4, 2019 record date
|
•
Consolidated Return on Capital
2
of 11.4%, which was an increase of 60 bps from 2017
|
|
•
All compliance goals for the Company and each of its Aaron’s Business and Progressive subsidiaries were fully achieved
|
|
•
Returned approximately $175 million to shareholders through stock repurchases and dividends
|
|
•
Increased the stock price by 7% from $39.47 on January 2, 2018, the first trading day of the year, to $42.05 on December 31, 2018, the last trading day of the year
|
|
|
|
1
Adjusted EBITDA is a measurement of our performance not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”). For a reconciliation of Adjusted EBITDA to the closest GAAP measurement, refer to the reconciliation set forth in the Company’s earnings press release furnished as an exhibit to the Current Report on Form 8-K the Company filed with the SEC on February 14, 2019.
|
|
2
We define Consolidated Return on Capital as net operating profit after tax divided by the sum of average net debt (which we define as debt less cash and cash equivalents) and average total shareholders' equity, with the final result being an average of quarterly calculations.
|
|
|
|
What We Do
|
|
What We Don’t Do
|
|
|
|
ü
Independent Compensation Committee assisted by an independent consultant
|
|
û
No repricing or cash buyouts of stock options without shareholder approval
|
|
|
|
ü
We annually assess the Company's compensation policies to ensure that the features of our program do not encourage undue risk
|
|
û
No excise or other tax gross-ups on change-in-control payments
|
|
|
|
ü
All executives are "at will" employees, with the elimination of employment agreements for all NEOs except for the CEO
|
|
û
No hedging or pledging of Company stock
|
|
|
|
ü
Pay mix that emphasizes performance-based compensation over fixed compensation (approximately 89% performance-based for CEO and approximately 77% for all other NEOs)
|
|
û
No excessive perquisites or other benefits
|
|
|
|
ü
Pay mix that emphasizes long-term, equity-based incentives over short-term cash incentives
|
|
û
No single-trigger severance benefits upon a change-in-control
|
|
|
|
ü
Incentive plans that utilize multiple measures, including growth, profitability, and returns
|
|
û
No payment of dividends on unearned or unvested shares
|
|
|
|
ü
Reasonable incentive plan targets and ranges, with capped incentive payouts
|
|
û
No guaranteed bonus payments
|
|
|
|
ü
Double-trigger equity vesting acceleration upon a change of control (awards granted in 2015 and later)
|
|
|
|
|
|
ü
Meaningful stock ownership requirements
|
|
|
|
|
|
ü
Formal clawback policy to recoup performance-based compensation from our senior executives, including NEOs, under certain prescribed acts of misconduct
|
|
|
|
|
•
|
attract, motivate, and retain quality executive leadership;
|
•
|
align the incentive goals of our executive officers with the interests of our shareholders;
|
•
|
enhance the individual performance of each executive officer;
|
•
|
improve our overall performance; and
|
•
|
support achievement of our business plans and long-term goals.
|
•
|
providing information on trends and related legislative, regulatory, and governance developments;
|
•
|
reviewing and recommending any changes to the benchmarking peer group for the consideration and approval of the Compensation Committee;
|
•
|
conducting competitive assessments of executive compensation levels and incentive program designs;
|
•
|
consulting on compensation for outside directors;
|
•
|
conducting a review of our compensation programs from a risk assessment perspective;
|
•
|
reviewing compensation tally sheets on our executive officers;
|
•
|
assisting with review and disclosures regarding the executive compensation programs; and
|
•
|
reviewing the Compensation Committee’s annual calendar and related governance matters.
|
Corporate Peers
|
|
Aaron's Business Unit Peers
|
|
Progressive Business Unit Peers
|
Big Lots, Inc.
|
|
Big Lots, Inc.
|
|
Credit Acceptance Corporation
|
Conn's, Inc.
|
|
Conn's, Inc.
|
|
Enova International, Inc.
|
Credit Acceptance Corporation
|
|
Dick's Sporting Goods, Inc.
|
|
ePlus inc.
|
Dick's Sporting Goods, Inc.
|
|
DSW Inc.
|
|
EZCORP, Inc.
|
ePlus inc.
|
|
FirstCash, Inc.
|
|
Fair Isaac Corporation
|
Green Dot Corporation
|
|
Herc Holdings Inc.
|
|
Green Dot Corporation
|
OneMain Holdings, Inc.
|
|
HSN, Inc.
|
|
LendingClub Corporation
|
Rent-A-Center, Inc.
|
|
Rent-A-Center, Inc.
|
|
OneMain Holdings, Inc.
|
Santander Consumer USA Holdings Inc.
|
|
Tractor Supply Company
|
|
Santander Consumer USA Holdings Inc.
|
Tractor Supply Company
|
|
Wayfair, Inc.
|
|
World Acceptance Corporation
|
Component
|
|
Terms and Objectives
|
|
|
|
Base Salary
|
|
▪
Fixed amount of compensation for performing day-to-day job responsibilities intended to reflect the scope of an executive’s role.
▪
Reviewed annually for potential adjustment based on factors such as market levels, individual performance, and scope of responsibility.
|
|
|
|
Annual Cash Incentive Award
|
|
▪
Variable performance-based award opportunity based on achievements with respect to the Company’s or Progressive or Aaron's Business financial and operational performance goals (Adjusted EBITDA, Adjusted Revenue, and Compliance).
|
|
|
|
Long-Term Equity Incentive Award
|
|
▪
To balance long-term performance and retention, 2018 equity awards were made in the form of 50% performance share units, 25% stock options, and 25% time-based restricted stock awards.
▪
Aligns executive interests with shareholders.
|
•
|
breadth and scope of an executive’s role, including any significant change in duties;
|
•
|
competitive market pay levels;
|
•
|
internal comparisons to similar roles;
|
•
|
individual performance throughout the year; and
|
•
|
overall economic climate, Company performance and, with respect to certain NEOs, the performance of Progressive or Aaron's Business.
|
Named Executive Officer
|
2018
Base Salary
|
||
John W. Robinson III
|
$
|
800,000
|
|
Steven A. Michaels
|
$
|
625,000
|
|
Ryan K. Woodley
|
$
|
600,000
|
|
Douglas A. Lindsay
|
$
|
600,000
|
|
Curtis L. Doman
|
$
|
475,000
|
|
Named Executive Officer
|
|
2018
Target % of Salary
|
John W. Robinson III
|
|
125%
|
Steven A. Michaels
|
|
100%
|
Ryan K. Woodley
|
|
100%
|
Douglas A. Lindsay
|
|
100%
|
Curtis L. Doman
|
|
100%
|
Aaron's, Inc.
Robinson and Michaels |
|
Progressive
Woodley and Doman |
|
Aaron's Business
Lindsay |
50% Adjusted EBITDA
|
|
50% Adjusted EBITDA
|
|
50% Adjusted EBITDA
|
30% Adjusted Revenue
|
|
30% Adjusted Revenue
|
|
30% Adjusted Revenue
|
20% Compliance
|
|
20% Compliance
|
|
20% Compliance
|
•
|
Adjusted revenues generally are measured on a GAAP basis, subject to the adjustments described below.
|
•
|
Adjusted EBITDA is based on GAAP earnings before interest, taxes, depreciation, and amortization, with overall Company and Progressive Adjusted EBITDA results (which, for purposes of determining Messrs. Woodley and Doman’s annual cash incentive award, is a combination of Progressive Leasing and Dent-A-Med, Inc. (“DAMI”) Adjusted EBITDA), subject to the adjustments described below.
|
•
|
Performance results for each measure also will exclude the effects of certain nonrecurring items of revenue or gain and expense or loss. For 2018, this included adjustments, as applicable, to remove the insurance recovery for Hurricane Harvey from Adjusted EBITDA metrics of Aaron’s Business and consolidated results, and to remove the effect of the provision for loan losses and litigation expense at DAMI.
|
•
|
Compliance-related goals for Progressive and our Aaron's Business for 2018 focused on several areas, including information security and related compliance training, the development and implementation of various processes to further improve compliance monitoring, and improving compliance procedures related to our Progressive business.
|
Aaron's Business: Lindsay
|
||||||||||||||
($ Million)
|
|
Weight
|
|
Plan Performance Range
|
|
Actual Performance and Payout
|
||||||||
Metric
|
|
|
Threshold
|
|
Target Zone
1
|
|
Maximum
|
|
Year Ending 12/31/2018
|
% of Target
|
Payout Calculation
|
|||
Aaron's Business Adj. Revenue
|
|
30%
|
|
$1,585
|
|
$1,744
|
-
|
$1,779
|
|
$1,938
|
|
$1,794
|
101.9%
|
104.3%
|
Aaron's Business Adj. EBITDA
6
|
|
50%
|
|
$151
|
|
$174
|
-
|
$181
|
|
$204
|
|
$171
|
96.1%
|
96.1%
|
Compliance
3
|
|
20%
|
|
|
|
4 Projects
|
|
5 Projects
|
|
5 Projects
|
125.0%
|
125.0%
|
||
Payout
|
|
|
|
25%
|
|
100%
|
|
200%
|
|
|
|
104.4%
|
||
|
||||||||||||||
1
If actual performance falls anywhere within this dollar range then payout is at 100% of target.
|
||||||||||||||
2
Further adjusted to remove the effect of provision and litigation expense at DAMI and to remove insurance recoveries for Hurricane Harvey at the Aaron's Business.
|
||||||||||||||
3
Maximum payout on Compliance is 125%.
|
||||||||||||||
4
Consolidation of Progressive and DAMI.
|
||||||||||||||
5
Consolidation of Progressive and DAMI, further adjusted to remove the effect of provision and litigation expense at DAMI.
|
||||||||||||||
6
Further adjusted to remove insurance recoveries for Hurricane Harvey.
|
•
|
reward the achievement of business objectives that the Compensation Committee believes will benefit our shareholders;
|
•
|
align the interests of our senior management with those of our shareholders; and
|
•
|
assist with retaining our senior management to ensure continuity of leadership.
|
Equity Award
|
Objective
|
Provisions
|
|
|
|
Performance Shares
|
▪
Focus participants on the fundamentals of growing our business and increasing the level of our earnings over the long term.
▪
One-year performance period ensures greater validity in our forecasts.
|
▪
Number of performance shares earned based on one-year Company performance.
▪
Earned awards are subject to additional time-based vesting, with vesting occurring in three equal increments following the first, second, and third anniversaries of the grant.
|
|
|
|
Stock Options
|
▪
Aligns executives with shareholders, with the value of an award realized only if the stock price appreciates following the date of grant.
|
▪
Pro rata annual three-year vesting, with vesting occurring in three equal increments following the first, second, and third anniversaries of the grant.
|
|
|
|
Restricted Stock
|
▪
Addresses competitive concerns with a focus on retaining our key executives needed to realize our long-term performance objectives.
|
▪
Pro rata annual three-year vesting, with vesting occurring in three equal increments following the first, second, and third anniversaries of the grant.
|
Named Executive Officer
|
|
LTIP Target % of Salary
|
Steven A. Michaels
|
|
225%
|
Ryan K. Woodley
|
|
400%
|
Douglas A. Lindsay
|
|
225%
|
Curtis L. Doman
|
|
300%
|
Named Executive Officer
|
|
Stock Options 25%
|
+
|
Restricted Stock 25%
|
+
|
Performance Shares 50%
|
=
|
2018 LTI Value Target
|
John W. Robinson III
|
|
$1,300,000
|
|
$1,300,000
|
|
$2,600,000
|
|
$5,200,000
|
Steven A. Michaels
|
|
$351,563
|
|
$351,563
|
|
$703,125
|
|
$1,406,250
|
Ryan K. Woodley
|
|
$600,000
|
|
$600,000
|
|
$1,200,000
|
|
$2,400,000
|
Douglas A. Lindsay
|
|
$337,500
|
|
$337,500
|
|
$675,000
|
|
$1,350,000
|
Curtis L. Doman
|
|
$356,250
|
|
$356,250
|
|
$712,500
|
|
$1,425,000
|
Named Executive Officer
|
|
Stock Options 25%
|
+
|
Restricted Stock 25%
|
+
|
Performance Shares 50%
|
=
|
2018 LTI Shares at Target
|
John W. Robinson III
|
|
87,330
|
|
27,510
|
|
55,020
|
|
169,860
|
Steven A. Michaels
|
|
23,640
|
|
7,440
|
|
14,880
|
|
45,960
|
Ryan K. Woodley
|
|
40,320
|
|
12,720
|
|
25,410
|
|
78,450
|
Douglas A. Lindsay
|
|
22,680
|
|
7,170
|
|
14,310
|
|
44,160
|
Curtis L. Doman
|
|
23,940
|
|
7,560
|
|
15,090
|
|
46,590
|
Aaron's, Inc.
Robinson and Michaels |
|
Progressive
Woodley and Doman |
|
Aaron's Business
Lindsay |
50% Adjusted Revenue
|
|
50% Revenue less Bad Debt Expense
|
|
50% Adjusted Revenue
|
25% Adjusted EBITDA
|
|
30% Adjusted EBITDA
|
|
30% Adjusted EBITDA
|
25% Return on Capital
|
|
20% Adjusted Revenue (Consolidated)
|
|
20% Adjusted Revenue (Consolidated)
|
•
|
Adjusted revenue is based on consolidated Aaron’s, Inc., Progressive, or Aaron’s Business results for 2018, as described above in “Components of the Executive Compensation Program-Annual Cash Incentive Awards;”
|
•
|
Adjusted EBITDA is based on consolidated Aaron’s, Inc., Progressive, or Aaron's Business results for 2018, as described above in “Components of the Executive Compensation Program-Annual Cash Incentive Awards;”
|
•
|
Return on capital was measured by dividing adjusted net operating profit after tax by the sum of average net debt (which we define as debt less cash and cash equivalents) and average total shareholders’ equity, with the final result being an average of quarterly calculations; and
|
•
|
Progressive Revenue less Bad Debt Expense does not include the consolidation with DAMI.
|
Feature
|
|
Provision
|
|
|
|
Required levels
|
|
5x base salary: Chief Executive Officer
3x base salary:
▪
CFO and President, Strategic Operations;
▪
Chief Executive Officer, Progressive; and
▪
Chief Product Officer, Progressive
2x base salary: President, Aaron's Business
|
|
|
|
Shares counted toward guidelines
|
|
Stock owned outright
Shares held in retirement accounts
Unvested time-based RSUs and RSAs
Earned but unvested performance shares
"In the money" value of vested but unexercised stock options
|
Name and Principal Position
|
|
Year
|
|
Salary
($) |
|
Bonus
(1)
($) |
|
Stock
Awards (2) ($) |
|
Option
Awards (3) ($) |
|
Non-Equity
Incentive Plan Compensation (4) ($) |
|
All Other
Compensation (5) ($) |
|
|
|
Total
($) |
John W. Robinson III
|
|
2018
|
|
784,615
|
|
—
|
|
3,900,368
|
|
1,444,438
|
|
1,016,300
|
|
6,317
|
|
|
|
7,152,038
|
Chief Executive Officer
|
|
2017
|
|
700,000
|
|
—
|
|
3,900,874
|
|
1,258,389
|
|
1,156,100
|
|
3,846
|
|
|
|
7,019,209
|
|
|
2016
|
|
700,000
|
|
—
|
|
3,902,004
|
|
1,297,620
|
|
781,600
|
|
5,982
|
|
|
|
6,687,206
|
Steven A. Michaels
|
|
2018
|
|
613,462
|
|
—
|
|
1,054,843
|
|
391,006
|
|
635,700
|
|
34,784
|
|
(6),(7)
|
|
2,729,795
|
Chief Financial Officer &
|
|
2017
|
|
550,000
|
|
—
|
|
826,000
|
|
266,247
|
|
789,900
|
|
19,452
|
|
|
|
2,451,599
|
President of Strategic
|
|
2016
|
|
531,689
|
|
—
|
|
825,228
|
|
274,476
|
|
516,200
|
|
14,142
|
|
|
|
2,161,735
|
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ryan K. Woodley
|
|
2018
|
|
574,616
|
|
—
|
|
1,802,024
|
|
666,893
|
|
602,900
|
|
11,540
|
|
(6)
|
|
3,657,973
|
Chief Executive Officer
|
|
2017
|
|
435,000
|
|
—
|
|
1,305,455
|
|
421,173
|
|
603,200
|
|
11,340
|
|
|
|
2,776,168
|
Progressive
|
|
2016
|
|
429,166
|
|
—
|
|
1,304,064
|
|
434,676
|
|
665,200
|
|
10,556
|
|
|
|
2,843,662
|
Douglas A. Lindsay
|
|
2018
|
|
584,615
|
|
—
|
|
1,015,145
|
|
375,127
|
|
610,100
|
|
25,418
|
|
(6),(7)
|
|
2,610,405
|
President,
|
|
2017
|
|
500,000
|
|
—
|
|
375,899
|
|
121,068
|
|
744,600
|
|
17,480
|
|
|
|
1,759,047
|
Aaron's Business
|
|
2016
|
|
458,333
|
|
180,000
|
|
801,359
|
|
115,489
|
|
341,400
|
|
175,207
|
|
|
|
2,071,788
|
Curtis L. Doman
|
|
2018
|
|
463,462
|
|
—
|
|
1,070,439
|
|
395,968
|
|
486,200
|
|
11,810
|
|
(6)
|
|
2,427,879
|
Chief Product Officer
|
|
2017
|
|
400,000
|
|
—
|
|
900,202
|
|
290,615
|
|
554,600
|
|
11,610
|
|
|
|
2,157,027
|
Progressive
|
|
2016
|
|
395,833
|
|
—
|
|
899,940
|
|
299,040
|
|
613,500
|
|
8,744
|
|
|
|
2,217,057
|
(1)
|
Represents cash bonuses paid to Mr. Lindsay in recognition of the important role that he played in developing the restructuring plan for our Aaron's Business, and to reward him for the numerous operational and other business improvements he initiated during 2016, as well as the strategies he developed and implemented to improve our ongoing results.
|
(2)
|
Represents the aggregate grant date fair value of awards of time-based RSUs, RSAs, and performance shares recognized by the Company as required by Financial Accounting Standards Board Codification Topic 718. See Note 12 to the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, for a discussion of the assumptions used in calculating these amounts. For the time-based RSUs and RSAs, the fair value is calculated using the closing stock price on the date of grant. For the performance shares, the fair value is also the closing stock price on the date of grant, multiplied by a number of shares that is based on the targeted attainment level, which represents the probable outcome of the performance condition on the date of grant. The amounts do not reflect the value actually realized or that may ultimately be realized by our named executive officers. Assuming the highest performance conditions for the performance share awards granted in
2018
, the grant date fair value would be: Mr. Robinson
$5,200,490
; Mr. Michaels
$1,406,458
; Mr. Woodley
$2,401,753
; Mr. Doman
$1,426,307
; and Mr. Lindsay
$1,352,581
.
|
(3)
|
Represents the grant date fair value of awards of stock options recognized by the Company as required by the Financial Accounting Standards Board Codification Topic 718. The Company determines the fair value of stock options on the grant date using a Black-Scholes-Merton option pricing model that incorporates expected volatility, expected option life, risk-free interest rates, and expected dividend yields. See Note 12 to the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, for a discussion of the assumptions used in calculating these amounts.
|
(4)
|
Reflects the value of the cash bonus earned under our annual cash incentive award program.
|
(5)
|
We provide a limited number of perquisites to our named executive officers and value those perquisites based on their aggregate incremental cost to the Company. We calculated the incremental cost of Company aircraft use based on the average variable operating costs to the Company. Variable operating costs include fuel costs, maintenance fees, positioning costs, catering costs, landing/ramp fees, and the amount, if any, of disallowed tax deductions associated with the personal use of Company aircraft. The total annual variable operating costs are divided by the annual number of flight hours flown by the aircraft to derive an average variable cost per flight hour. This average variable cost per flight hour is then multiplied by the flight hours flown for personal use to derive the incremental cost to the Company. This method excludes fixed costs that do not change based on usage, such as pilots’ and other employees’ salaries and benefits and hangar expenses. Aggregate incremental cost, if any, of travel by the executive’s family or other guests when accompanying the executive is also included.
|
(6)
|
Includes matching contributions in the amount of
$11,000
made by the Company to Messr. Michaels’, Woodley’s, Doman’s, or Lindsay’s account, as applicable, in the Company’s 401(k) plan.
|
(7)
|
Includes matching contributions in the amount of
$11,000
made by the Company to Messr. Michaels' or Lindsay's account, as applicable, as part of the Nonqualified Deferred Compensation plan. These amounts are also included in the Nonqualified Deferred Compensation section below.
|
Name
|
Grant
Date
|
|
Potential Payouts Under Non-
Equity Incentive Plan
Awards
(1)
|
|
Estimated Future
Payouts Under Equity
Incentive Plan Awards
(2)
|
|
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(3)
|
|
All
Other
Option
Awards:
Number
of
Securities
Under-
lying
Options
(4)
|
|
Exercise
or Base
Price of
Option
Awards
($/Sh)
|
|
Grant
Date
Fair
Value of
Stock
and
Option
Awards
(5)
($)
|
||||||||||||||||||
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Threshold
(#)
|
|
Target
(#)
|
|
Maximum
(#)
|
|
||||||||||||||||||||
John W. Robinson III
|
|
|
245,192
|
|
|
980,769
|
|
|
1,814,423
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
3/2/2018
|
|
|
|
|
|
|
|
13,755
|
|
|
55,020
|
|
|
110,040
|
|
|
|
|
|
|
|
|
2,600,245
|
|
||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,510
|
|
|
|
|
|
|
1,300,123
|
|
||||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
87,330
|
|
|
47.26
|
|
|
1,444,438
|
|
|||||||
Steven A. Michaels
|
|
|
153,365
|
|
|
613,462
|
|
|
1,134,904
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
3/2/2018
|
|
|
|
|
|
|
|
3,720
|
|
|
14,880
|
|
|
29,760
|
|
|
|
|
|
|
|
|
703,229
|
|
||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,440
|
|
|
|
|
|
|
351,614
|
|
||||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,640
|
|
|
47.26
|
|
|
391,006
|
|
|||||||
Ryan K. Woodley
|
|
|
143,654
|
|
|
574,616
|
|
|
1,063,039
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
3/2/2018
|
|
|
|
|
|
|
|
6,353
|
|
|
25,410
|
|
|
50,820
|
|
|
|
|
|
|
|
|
1,200,877
|
|
||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,720
|
|
|
|
|
|
|
601,147
|
|
||||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,320
|
|
|
47.26
|
|
|
666,893
|
|
|||||||
Douglas A. Lindsay
|
|
|
146,154
|
|
|
584,615
|
|
|
1,081,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
3/2/2018
|
|
|
|
|
|
|
|
3,578
|
|
|
14,310
|
|
|
28,620
|
|
|
|
|
|
|
|
|
676,291
|
|
||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,170
|
|
|
|
|
|
|
338,854
|
|
||||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,680
|
|
|
47.26
|
|
|
375,127
|
|
|||||||
Curtis L. Doman
|
|
|
115,865
|
|
|
463,462
|
|
|
857,404
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
3/2/2018
|
|
|
|
|
|
|
|
3,773
|
|
|
15,090
|
|
|
30,180
|
|
|
|
|
|
|
|
|
713,153
|
|
||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,560
|
|
|
|
|
|
|
357,286
|
|
||||||||
|
3/2/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23,940
|
|
|
47.26
|
|
|
395,968
|
|
(1)
|
For the named executive officers, represents the amounts that could be earned under the annual cash incentive award program based on performance against pre-determined goals for Adjusted revenue and Adjusted EBITDA, measured on a Company-wide basis or for Aaron's Business or Progressive, based on each executive’s organizational level. The amounts actually earned are included in the non-equity incentive plan compensation column of the Summary Compensation Table.
|
(2)
|
Represents the performance shares granted under our 2018 long-term equity incentive award program. Performance metrics for Messrs. Robinson and Michaels included consolidated Company Adjusted revenues, consolidated Company Adjusted EBITDA and consolidated return on capital. Performance metrics for Messrs. Woodley and Doman included Progressive Adjusted EBITDA, Progressive revenues less bad debt expense and consolidated Company total Adjusted revenues. Performance metrics for Mr. Lindsay included consolidated Company Adjusted revenues, Adjusted revenues for the Aaron's Business and Adjusted EBITDA for the Aaron's Business. For all named executive officers who received awards, the threshold number of shares represents 25% of target, and the maximum number of shares represents 200% of target. Any awards earned vest in three approximately equal increments over a three-year period on March 7, 2019, 2020 and 2021. Based on our performance for the year, performance shares were earned under the 2018 program at
99.0%
of target for Messrs. Robinson and Michaels, at
99.9%
of target for Messrs. Woodley and Doman, and at
101.0%
of target for Mr. Lindsay.
|
(3)
|
Includes the time-based RSAs granted to each of our named executive officers under our 2018 long-term equity incentive award program, that are expected to vest in three approximately equal increments over a three-year period on each of March 7, 2019, 2020 and 2021.
|
(4)
|
Includes stock options granted under our 2018 long-term equity incentive award program that are expected to vest in three approximately equal increments over a three-year period on each of March 7, 2019, 2020 and 2021.
|
(5)
|
Represents the aggregate grant date fair value of awards recognized by the Company as required by Financial Accounting Standards Board Codification Topic 718. See Note 12 to the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2018
for a discussion of the assumptions used in calculating these amounts.
|
•
|
the maximum number of options and SARs is 1,000,000;
|
•
|
the maximum number of shares of restricted stock and/or RSUs is 600,000 shares and/or units;
|
•
|
the maximum aggregate payout with respect to performance shares and/or performance units is $5,000,000 dollars (to the extent settled in cash) or 600,000 shares (to the extent settled in shares);
|
•
|
the maximum number of other awards is the fair market value (determined as of the grant date) of 600,000 shares;
|
•
|
the maximum aggregate payout (determined as of the end of the applicable performance period) with respect to annual incentive cash awards is $5,000,000; and
|
•
|
the maximum aggregate number of shares under all awards granted in any one fiscal year to any non-employee director (excluding any awards made at the election of the director in lieu of all or a portion of the director’s annual and committee cash retainer fees) is 20,000 shares.
|
Name of Executive
|
|
Number of
Securities Underlying Unexercised Options Exercisable |
|
|
|
Number of
Securities Underlying Unexercised Options Unexercisable |
|
|
|
Option
Exercise Price ($) |
|
Option
Expiration Date |
|
Number of
Shares of Stock That Have Not Vested |
|
|
|
Market Value
of Shares or Units of Stock That Have Not Vested ($) (1) |
|
Equity Incentive
Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested |
|
|
|
Equity Incentive
Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (1) |
|||||||
John W. Robinson III
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
160,919
|
|
|
|
|
—
|
|
|
|
|
27.80
|
|
|
12/5/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
121,500
|
|
|
(2)
|
|
60,750
|
|
|
(2)
|
|
22.64
|
|
|
2/26/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
49,060
|
|
|
(3)
|
|
98,120
|
|
|
(3)
|
|
27.18
|
|
|
2/24/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
87,330
|
|
|
(4)
|
|
47.26
|
|
|
3/2/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,150
|
|
|
(5)
|
|
805,258
|
|
|
37,534
|
|
|
|
|
1,578,305
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,900
|
|
|
(6)
|
|
1,341,395
|
|
|
89,548
|
|
|
|
|
3,765,493
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,510
|
|
|
(7)
|
|
1,156,796
|
|
|
55,020
|
|
|
(9)
|
|
2,313,591
|
|
|||
Steven A. Michaels
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
11,250
|
|
|
|
|
—
|
|
|
|
|
19.92
|
|
|
2/23/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
4,735
|
|
|
|
|
—
|
|
|
|
|
29.77
|
|
|
2/18/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
7,597
|
|
|
|
|
—
|
|
|
|
|
29.25
|
|
|
4/15/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
25,200
|
|
|
|
|
—
|
|
|
|
|
28.04
|
|
|
3/10/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
25,700
|
|
|
(2)
|
|
12,850
|
|
|
(2)
|
|
22.64
|
|
|
2/26/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
10,380
|
|
|
(3)
|
|
20,760
|
|
|
(3)
|
|
27.18
|
|
|
2/24/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
23,640
|
|
|
(4)
|
|
47.26
|
|
|
3/2/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,050
|
|
|
(5)
|
|
170,303
|
|
|
7,938
|
|
|
|
|
333,793
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,760
|
|
|
(6)
|
|
284,258
|
|
|
18,954
|
|
|
|
|
797,016
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,440
|
|
|
(7)
|
|
312,852
|
|
|
14,880
|
|
|
(9)
|
|
625,704
|
|
|||
Ryan K. Woodley
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
42,600
|
|
|
|
|
—
|
|
|
|
|
32.20
|
|
|
2/6/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
40,700
|
|
|
(2)
|
|
20,350
|
|
|
(2)
|
|
22.64
|
|
|
2/26/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
16,420
|
|
|
(3)
|
|
32,840
|
|
|
(3)
|
|
27.18
|
|
|
2/24/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
40,320
|
|
|
(4)
|
|
47.26
|
|
|
3/2/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,400
|
|
|
(5)
|
|
269,120
|
|
|
16,563
|
|
|
|
|
696,474
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,680
|
|
|
(6)
|
|
449,094
|
|
|
35,382
|
|
|
|
|
1,487,813
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,720
|
|
|
(7)
|
|
534,876
|
|
|
25,410
|
|
|
(9)
|
|
1,068,491
|
|
|||
Douglas A. Lindsay
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
12,260
|
|
|
(2)
|
|
6,130
|
|
|
(2)
|
|
22.65
|
|
|
2/1/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
4,720
|
|
|
(3)
|
|
9,440
|
|
|
(3)
|
|
27.18
|
|
|
2/24/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
22,680
|
|
|
(4)
|
|
47.26
|
|
|
3/2/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,765
|
|
|
(8)
|
|
789,068
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,840
|
|
|
(5)
|
|
77,372
|
|
|
2,745
|
|
|
|
|
115,427
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,080
|
|
|
(6)
|
|
129,514
|
|
|
9,032
|
|
|
|
|
379,796
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,170
|
|
|
(7)
|
|
301,499
|
|
|
14,310
|
|
|
(9)
|
|
601,736
|
|
|||
Curtis L. Doman
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
30,000
|
|
|
|
|
—
|
|
|
|
|
32.20
|
|
|
2/6/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
28,000
|
|
|
(2)
|
|
14,000
|
|
|
(2)
|
|
22.64
|
|
|
2/26/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
11,330
|
|
|
(3)
|
|
22,660
|
|
|
(3)
|
|
27.18
|
|
|
2/24/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
23,940
|
|
|
(4)
|
|
47.26
|
|
|
3/2/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,400
|
|
|
(5)
|
|
185,020
|
|
|
11,452
|
|
|
|
|
481,557
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,360
|
|
|
(6)
|
|
309,488
|
|
|
24,406
|
|
|
|
|
1,026,272
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,560
|
|
|
(7)
|
|
317,898
|
|
|
15,090
|
|
|
(9)
|
|
634,535
|
|
(1)
|
Reflects award value based on a share price of
$42.05
, the closing price of our common stock on
December 31, 2018
.
|
(2)
|
These options vest in three equal increments on each of March 15, 2017, 2018 and 2019.
|
(3)
|
These options vest in three equal increments on each of March 15, 2018, 2019 and 2020.
|
(4)
|
These options vest in three equal increments on each of March 7, 2019, 2020 and 2021.
|
(5)
|
These RSUs vested on March 15, 2019.
|
(6)
|
One half of these RSAs vested on March 15, 2019 and the remaining one-half are expected to vest on March 15, 2020.
|
(7)
|
These RSAs vest in three equal increments on each of March 7, 2019, 2020 and 2021.
|
(8)
|
These RSUs vested on February 1, 2019.
|
(9)
|
Amounts shown reflect performance shares subject to meeting specific performance goals and service periods, which, based on Company performance, are reflected at the target award level. Performance shares earned vest in three equal increments on each of March 7, 2019, 2020 and 2021.
|
|
|
Option Awards
|
|
Stock Awards
|
||||||||
Name
|
|
Number of Shares
Acquired on Exercise (#) |
|
Value Realized on
Exercise
($)
|
|
Number of Shares
Acquired on Vesting (#) |
|
Value Realized
on Vesting (1)
($)
|
||||
John W. Robinson III
|
|
—
|
|
|
—
|
|
|
202,984
|
|
|
9,667,496
|
|
Steven A. Michaels
|
|
—
|
|
|
—
|
|
|
33,331
|
|
|
1,592,089
|
|
Ryan K. Woodley
|
|
—
|
|
|
—
|
|
|
85,078
|
|
|
4,028,713
|
|
Douglas A. Lindsay
|
|
—
|
|
|
—
|
|
|
10,641
|
|
|
509,172
|
|
Curtis L. Doman
|
|
—
|
|
|
—
|
|
|
67,223
|
|
|
3,174,351
|
|
(1)
|
Reflects the value of shares that vested based on the closing price of our common stock on the applicable vesting date.
|
Name of Executive
|
|
Named Executive
Officer Contributions in 2018 |
|
Company
Contributions in 2018 (2) |
|
Aggregate
Earnings (Loss) in Last Fiscal Year |
|
Aggregate
Withdrawals / Distributions |
|
Aggregate
Balance at December 31, 2018 |
||||||||||
John W. Robinson III
(1)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Steven A. Michaels
|
|
30,673
|
|
|
11,000
|
|
|
(33,481
|
)
|
|
—
|
|
|
534,975
|
|
|||||
Ryan K. Woodley
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Douglas A. Lindsay
|
|
29,231
|
|
|
11,000
|
|
|
(2,470
|
)
|
|
—
|
|
|
37,761
|
|
|||||
Curtis L. Doman
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(1)
|
Messrs. Robinson, Woodley, and Doman do not participate in the Deferred Compensation Plan.
|
(2)
|
Company discretionary match is calculated and allocated in Q1 of 2019 based on contributions made in 2018. Also included in the Other Compensation column of the Summary Compensation Table.
|
John W. Robinson III
|
||||||||||||||||
Termination Event
|
|
Cash Severance
|
|
Equity Acceleration
|
|
Cash Bonus
|
|
Total Value
|
||||||||
Voluntary Resignation by Executive
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,016,300
|
|
|
$
|
1,016,300
|
|
Termination by Company for Cause
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination due to Death
|
|
$
|
—
|
|
|
$
|
13,599,039
|
|
|
$
|
1,016,300
|
|
|
$
|
14,615,339
|
|
Termination due to Disability
|
|
$
|
—
|
|
|
$
|
13,599,039
|
|
|
$
|
1,016,300
|
|
|
$
|
14,615,339
|
|
Termination by Company without Cause
|
|
$
|
3,637,488
|
|
|
$
|
—
|
|
|
$
|
968,850
|
|
|
$
|
4,606,338
|
|
Termination by Executive for Good Reason
|
|
$
|
3,637,488
|
|
|
$
|
—
|
|
|
$
|
968,850
|
|
|
$
|
4,606,338
|
|
Termination by Company without Cause (following CIC)
|
|
$
|
2,686,686
|
|
|
$
|
13,599,039
|
|
|
$
|
968,850
|
|
|
$
|
17,254,575
|
|
Termination by Executive for Good Reason (following CIC)
|
|
$
|
2,686,686
|
|
|
$
|
13,599,039
|
|
|
$
|
968,850
|
|
|
$
|
17,254,575
|
|
Change in Control (CIC)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Steven A. Michaels
|
||||||||||||||||
Termination Event
|
|
Cash Severance
|
|
Equity Acceleration
|
|
Cash Bonus
|
|
Total Value
|
||||||||
Voluntary Resignation by Executive
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company for Cause
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination due to Death
|
|
$
|
—
|
|
|
$
|
3,082,045
|
|
|
$
|
—
|
|
|
$
|
3,082,045
|
|
Termination due to Disability
|
|
$
|
—
|
|
|
$
|
3,082,045
|
|
|
$
|
—
|
|
|
$
|
3,082,045
|
|
Termination by Company without Cause
|
|
$
|
644,106
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
644,106
|
|
Termination by Executive for Good Reason
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company without Cause (following CIC)
|
|
$
|
1,935,789
|
|
|
$
|
3,082,045
|
|
|
$
|
625,000
|
|
|
$
|
5,642,834
|
|
Termination by Executive for Good Reason (following CIC)
|
|
$
|
1,935,789
|
|
|
$
|
3,082,045
|
|
|
$
|
625,000
|
|
|
$
|
5,642,834
|
|
Change in Control (CIC)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Ryan K. Woodley
|
||||||||||||||||
Termination Event
|
|
Cash Severance
|
|
Equity Acceleration
|
|
Cash Bonus
|
|
Total Value
|
||||||||
Voluntary Resignation by Executive
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company for Cause
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination due to Death
|
|
$
|
—
|
|
|
$
|
5,389,192
|
|
|
$
|
—
|
|
|
$
|
5,389,192
|
|
Termination due to Disability
|
|
$
|
—
|
|
|
$
|
5,389,192
|
|
|
$
|
—
|
|
|
$
|
5,389,192
|
|
Termination by Company without Cause
|
|
$
|
625,045
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
625,045
|
|
Termination by Executive for Good Reason
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company without Cause (following CIC)
|
|
$
|
2,450,090
|
|
|
$
|
5,389,192
|
|
|
$
|
600,000
|
|
|
$
|
8,439,282
|
|
Termination by Executive for Good Reason (following CIC)
|
|
$
|
2,450,090
|
|
|
$
|
5,389,192
|
|
|
$
|
600,000
|
|
|
$
|
8,439,282
|
|
Change in Control (CIC)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Douglas A. Lindsay
|
||||||||||||||||
Termination Event
|
|
Cash Severance
|
|
Equity Acceleration
|
|
Cash Bonus
|
|
Total Value
|
||||||||
Voluntary Resignation by Executive
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company for Cause
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination due to Death
|
|
$
|
—
|
|
|
$
|
2,653,706
|
|
|
$
|
—
|
|
|
$
|
2,653,706
|
|
Termination due to Disability
|
|
$
|
—
|
|
|
$
|
2,653,706
|
|
|
$
|
—
|
|
|
$
|
2,653,706
|
|
Termination by Company without Cause
|
|
$
|
620,657
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
620,657
|
|
Termination by Executive for Good Reason
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company without Cause (following CIC)
|
|
$
|
1,961,379
|
|
|
$
|
2,653,706
|
|
|
$
|
600,000
|
|
|
$
|
5,215,085
|
|
Termination by Executive for Good Reason (following CIC)
|
|
$
|
1,961,379
|
|
|
$
|
2,653,706
|
|
|
$
|
600,000
|
|
|
$
|
5,215,085
|
|
Change in Control (CIC)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Curtis H. Doman
|
||||||||||||||||
Termination Event
|
|
Cash Severance
|
|
Equity Acceleration
|
|
Cash Bonus
|
|
Total Value
|
||||||||
Voluntary Resignation by Executive
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company for Cause
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination due to Death
|
|
$
|
—
|
|
|
$
|
3,563,464
|
|
|
$
|
—
|
|
|
$
|
3,563,464
|
|
Termination due to Disability
|
|
$
|
—
|
|
|
$
|
3,563,464
|
|
|
$
|
—
|
|
|
$
|
3,563,464
|
|
Termination by Company without Cause
|
|
$
|
497,759
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
497,759
|
|
Termination by Executive for Good Reason
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Termination by Company without Cause (following CIC)
|
|
$
|
1,459,138
|
|
|
$
|
3,563,464
|
|
|
$
|
475,000
|
|
|
$
|
5,497,602
|
|
Termination by Executive for Good Reason (following CIC)
|
|
$
|
1,459,138
|
|
|
$
|
3,563,464
|
|
|
$
|
475,000
|
|
|
$
|
5,497,602
|
|
Change in Control (CIC)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
the annual total compensation of the employee identified as the median paid employee of our company (other than our CEO), was $30,904;
|
•
|
the annual total compensation of our CEO was $7,152,038; and
|
•
|
the ratio between the annual total compensation of our CEO to the annual total compensation of the individual identified at median was estimated to be 231 to 1.
|
•
|
We determined that, as of December 31, 2017, our employee population consisted of approximately 12,208 individuals globally.
|
•
|
Pursuant to SEC rules, we employed the 5% “De Minimis Exemption” adjustment. The De Minimis Exemption allowed us to exclude our Canadian population of 294 employees as this population was less than 5% of our total population. After applying this exemption, the employee population used for purposes of identifying the median employee consisted of 11,914 employees, of whom all were located in the United States.
|
•
|
various types of risks;
|
•
|
compliance programs;
|
•
|
ethics program; and
|
•
|
information security and privacy program, including its cybersecurity risk mitigation initiatives.
|
•
|
The presentation and integrity of the Company’s consolidated financial statements;
|
•
|
Implementing accounting and financial reporting principles;
|
•
|
Establishing and maintaining disclosure controls and procedures;
|
•
|
Establishing and maintaining internal controls over financial reporting;
|
•
|
Evaluating the effectiveness of disclosure controls and procedures;
|
•
|
Evaluating the effectiveness of internal controls over financial reporting;
|
•
|
Evaluating any change in internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting; and
|
•
|
Establishing and maintaining the Company’s Enterprise Risk Management program.
|
•
|
EY’s historical and recent performance on the Company’s audit;
|
•
|
EY’s capability, expertise, and relevant industry knowledge;
|
•
|
External information on EY’s audit quality and performance, such as reports from the Public Company Accounting Oversight Board ("PCAOB");
|
•
|
EY’s fees and related staffing for the Company's audit; and
|
•
|
EY’s independence and tenure as our auditor, including the benefits and independence risks of having a long-tenured auditor, and the controls and processes of the Company and EY that help ensure EY’s independence.
|
|
|
Year Ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Audit Fees
(1)
|
|
$
|
2,714,075
|
|
|
$
|
2,505,250
|
|
Audit-Related Fees
(2)
|
|
108,000
|
|
|
18,000
|
|
||
Tax Fees
(3)
|
|
1,168,269
|
|
|
1,074,176
|
|
||
All Other Fees
(4)
|
|
7,200
|
|
|
1,995
|
|
||
TOTAL
|
|
$
|
3,997,544
|
|
|
$
|
3,599,421
|
|
(1)
|
Includes fees associated with the annual audit of the consolidated financial statements (including amounts in connection with certain 2017 and 2018 audit procedures for the significant acquisitions of franchisees), internal control over financial reporting, reviews of the quarterly reports on Form 10-Q, assistance with and review of documents filed with the SEC, and accounting and financial reporting consultations and research work necessary to comply with generally accepted auditing standards. In addition to the fees reflected above, the Company reimbursed EY for out of pocket expenses that were incurred while performing these audit services totaling $49,227 and $50,328 in 2018 and 2017, respectively.
|
(2)
|
Includes fees associated with the PerfectHome due diligence and other efforts in 2018, debt covenant letters in 2018 and 2017, the audit report in the franchise disclosure document in 2017, and agreed upon procedures report for DAMI debt compliance in 2017.
|
(3)
|
Includes fees for tax compliance, tax advice and tax planning services.
|
(4)
|
Includes fees associated with the Company’s online accounting research subscription.
|
Name and Address of Beneficial Owner
(1)
|
|
Amount and Nature
of Beneficial Ownership |
|
|
|
Percent of Class
(2)
|
||
BlackRock Inc.
|
|
8,461,144
|
|
|
(3)
|
|
12.30
|
%
|
55 East 52nd Street
|
|
|
|
|
|
|
||
New York, NY 10055
|
|
|
|
|
|
|
||
The Vanguard Group
|
|
6,907,766
|
|
|
(4)
|
|
10.07
|
%
|
100 Vanguard Boulevard
|
|
|
|
|
|
|
||
Malvern, PA 19355
|
|
|
|
|
|
|
||
Dimensional Fund Advisors, LP.
|
|
5,685,822
|
|
|
(5)
|
|
8.29
|
%
|
Building One
|
|
|
|
|
|
|
||
6300 Bee Cave Road
|
|
|
|
|
|
|
||
Austin, TX 19355
|
|
|
|
|
|
|
||
T. Rowe Price Associates, Inc.
|
|
5,112,725
|
|
|
(6)
|
|
7.40
|
%
|
100 E. Pratt Street
|
|
|
|
|
|
|
||
Baltimore, MD 21202
|
|
|
|
|
|
|
||
John W. Robinson III
|
|
813,497
|
|
|
(7)
|
|
1.19
|
%
|
Steven A. Michaels
|
|
182,750
|
|
|
(8)
|
|
*
|
|
Ryan K. Woodley
|
|
272,251
|
|
|
(9)
|
|
*
|
|
Douglas A. Lindsay
|
|
88,455
|
|
|
(10)
|
|
*
|
|
Curtis L. Doman
|
|
291,585
|
|
|
(11)
|
|
*
|
|
Kathy T. Betty
|
|
34,206
|
|
|
(12)
|
|
*
|
|
Douglas C. Curling
|
|
10,188
|
|
|
(12)
|
|
*
|
|
Cynthia N. Day
|
|
16,676
|
|
|
(12)
|
|
*
|
|
Walther G. Ehmer
|
|
8,233
|
|
|
(12)
|
|
*
|
|
Hubert L. Harris, Jr.
|
|
18,676
|
|
|
(13)
|
|
*
|
|
Ray M. Robinson
|
|
26,301
|
|
|
(14)
|
|
*
|
|
Robert H. Yanker
|
|
8,233
|
|
|
(12)
|
|
*
|
|
All executive officers, directors and nominees as a group (a total of 14 persons)
|
|
1,901,167
|
|
|
(15)
|
|
2.78
|
%
|
* Less than 1%.
|
(1)
|
Unless otherwise stated, the address for each beneficial owner is c/o Aaron’s, Inc., 400 Galleria Parkway SE, Suite 300, Atlanta, Georgia 30339.
|
(2)
|
Percentages for executive officers, directors and nominees are based on (i)
67,778,066
shares of common stock outstanding at
March 4, 2019
plus (ii) for each named person or group, options exercisable by such person or group within 60 days thereafter, and any RSUs, RSAs, and PSUs, that vest for each named person within 60 days thereafter.
|
(3)
|
As of December 31, 2018, based on information provided in a Schedule 13G/A filed with the SEC on January 24, 2019 by BlackRock, Inc., which we refer to as “BlackRock,” in which BlackRock reported that it has sole voting power with respect to 8,161,430 shares of our common stock and sole power to dispose of, or direct the disposition of, 8,461,144 shares of our common stock.
|
(4)
|
As of December 31, 2018, based on information provided in a Schedule 13G/A filed with the SEC on January 10, 2019 by The Vanguard Group, which we refer to as “Vanguard,” in which Vanguard reported that it has sole voting power with respect to 68,091 shares of our common stock, shared voting power with respect to 8,846 shares of our common stock, sole power to dispose of, or direct the disposition of, 6,837,527 shares of our common stock, and shared power to dispose of, or direct the disposition of, 70,239 shares of our common stock. Based on the Schedule 13G/A, (i) the Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of Vanguard, is the beneficial owner of 61,393 shares as a result of its serving as investment manager of collective trust accounts and (ii) Vanguard Investments Australia, Ltd., a wholly-owned subsidiary of Vanguard, is the beneficial owner of 15,544 shares as a result of its serving as investment manager of Australian investment offerings.
|
(5)
|
As of December 31, 2018, based on information provided in a Schedule 13G/A filed with the SEC on February 8, 2019 by Dimensional Fund Advisors LP, which we refer to as “Dimensional,” in which Dimensional reported that it has sole voting power with respect to 5,539,434 shares of our common stock and sole power to dispose of, or direct the disposition of, 5,685,822 shares of our common stock. Dimensional is an investment adviser registered under Section 203 of the Investment Advisors Act of 1940 that furnishes investment advice to four investment companies registered under the Investment Company Act of 1940, and serves as investment manager or sub-adviser to certain other commingled funds, group trusts and separate accounts. Dimensional or its subsidiaries may possess voting or investment power over shares of our common stock that are owned by these investment companies, trusts and accounts, and may be deemed to be the beneficial owner of the shares of our common stock held by these investment companies, trusts and accounts. Dimensional disclaims beneficial ownership of all shares of our common stock.
|
(6)
|
As of December 31, 2018, based on information provided in a Schedule 13G filed with the SEC on February 14, 2019 by T. Rowe Price Associates, Inc., which we refer to as “T. Rowe Price,” in which T. Rowe Price reported that it has sole voting power with respect to 1,269,831 shares of our common stock and sole power to dispose of, or direct the disposition of, 5,112,725 shares of our common stock.
|
(7)
|
Amounts represent (i)
140,073
shares of common stock held by Mr. Robinson, (ii)
160,919
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable, (iii)
170,560
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (iv)
29,110
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (v)
109,810
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (vi)
19,150
RSUs vesting on
March 15, 2019
, (vii)
9,170
RSAs vesting on
March 7, 2019
, (viii)
15,950
RSAs vesting on
March 15, 2019
, (ix)
58,290
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (x)
18,157
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
and (xi)
82,308
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
. Does not include (i)
174,210
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions or (ii)
81,088
PSUs that remain subject to vesting conditions.
|
(8)
|
Amounts represent (i)
19,693
shares of common stock held by Mr. Michaels, (ii)
48,782
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable, (iii)
36,080
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (iv)
7,880
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (v)
23,230
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (vi)
4,050
RSUs vesting on
March 15, 2019
, (vii)
2,480
RSAs vesting on
March 7, 2019
, (viii)
3,380
RSAs vesting on
March 15, 2019
, (ix)
14,850
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (x)
4,910
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
and (xi)
17,415
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
. Does not include (i)
44,260
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions or (ii)
19,297
PSUs that remain subject to vesting conditions.
|
(9)
|
Amounts represent (i)
38,705
shares of common stock held by Mr. Woodley, (ii)
42,600
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable, (iii)
57,120
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (iv)
13,440
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (v)
36,770
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (vi)
6,400
RSUs vesting on
March 15, 2019
, (vii)
4,240
RSAs vesting on
March 7, 2019
, (viii)
5,340
RSAs vesting on
March 15, 2019
, (ix)
24,920
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (x)
8,462
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
and (xi)
34,254
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
. Does not include (i)
74,200
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions or (ii)
34,615
PSUs that remain subject to vesting conditions.
|
(10)
|
Amounts represent (i)
22,656
shares of common stock held by Mr. Lindsay, (ii)
16,980
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (iii)
7,560
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (iv)
10,850
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (v)
1,840
RSUs vesting on
March 15, 2019
, (vi)
2,390
RSAs vesting on
March 7, 2019
, (vii)
1,540
RSAs vesting on
March 15, 2019
, (viii)
12,560
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (ix)
4,818
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
and (x)
7,261
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
. Does not include (i)
37,240
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions or (ii)
14,152
PSUs that remain subject to vesting conditions.
|
(11)
|
Amounts represent (i)
62,345
shares of common stock held by Mr. Doman, (ii)
72,000
shares of common stock held by an LLC controlled by Mr. Doman, (iii)
30,000
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable, (iv)
39,330
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (v)
7,980
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (vi)
25,330
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (vii)
4,400
RSUs vesting on
March 15, 2019
, (viii)
2,520
RSAs vesting on
March 7, 2019
, (ix)
3,680
RSAs vesting on
March 15, 2019
, (x)
15,320
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (xi)
5,025
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
and (xii)
23,655
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
. Does not include (i)
45,650
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions or (ii)
22,253
PSUs that remain subject to vesting conditions.
|
(12)
|
Does not include
1,467
RSUs that remain subject to vesting conditions.
|
(13)
|
Includes
2,000
shares of common stock held by Mr. Harris’ spouse. Does not include
1,467
RSUs that remain subject to vesting conditions.
|
(14)
|
Includes
3,000
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable. Does not include
1,467
RSUs that remain subject to vesting conditions.
|
(15)
|
Amounts represent (i)
421,020
shares of common stock held directly by the respective individuals, (ii)
74,000
shares of common stock held indirectly by certain individuals as described above, (iii)
322,809
shares of common stock issuable upon the exercise of options issued under the 2001 Incentive Plan that are currently exercisable, (iv)
341,580
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that are currently exercisable, (v)
70,300
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 7, 2019
, (vi)
219,850
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that become exercisable on
March 15, 2019
, (vii)
38,240
RSUs vesting on
March 15, 2019
, (viii)
22,170
RSAs vesting on
March 7, 2019
, (ix)
31,910
RSAs vesting on
March 15, 2019
, (x)
134,270
RSAs which are entitled to voting and dividend rights as described in the related award agreement though still subject to vesting, (xi)
44,075
PSUs which have met performance conditions and are scheduled to vest on
March 7, 2019
, (xii)
175,269
PSUs which have met performance conditions and are scheduled to vest on
March 15, 2019
, and (xiii)
5,674
shares of common stock held in 401(k) plan accounts. Does not include (i)
400,420
shares of common stock issuable upon the exercise of options issued under the 2015 Incentive Plan that remain subject to vesting conditions, (ii)
182,483
PSUs that remain subject to vesting conditions, or (iii)
10,269
RSUs that remain subject to vesting conditions.
|
•
|
To elect eight directors to serve for a term expiring at the 2020 Annual Meeting of Shareholders.
|
•
|
To vote on a non-binding, advisory resolution approving Aaron’s executive compensation.
|
•
|
To vote to approve the Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan.
|
•
|
To ratify the appointment of Ernst & Young LLP as Aaron’s independent registered public accounting firm for 2019.
|
•
|
“FOR” the election of each of the eight director nominees named in this Proxy Statement to serve for a term expiring at the 2020 Annual Meeting of Shareholders (Proposal 1).
|
•
|
“FOR” approval of a non-binding, advisory resolution approving Aaron’s executive compensation (Proposal 2).
|
•
|
“FOR” approval of the Aaron's, Inc. Amended and Restated 2015 Equity and Incentive Plan (Proposal 3).
|
•
|
“FOR” the proposal to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2019 (Proposal 4).
|
•
|
Over the Internet at the website listed in our Notice and Access Letter.
|
•
|
By telephone using the telephone number listed in our Notice and Access Letter.
|
•
|
By completing, signing, dating and returning a written proxy card. To vote by using a written proxy card, mark your selections on the proxy card, date the proxy card and sign your name exactly as it appears on your proxy card, and return your proxy card by mail in the pre-addressed, postage-paid envelope which will be included with the written proxy card.
|
•
|
By attending the Annual Meeting and voting in person.
|
•
|
Vote again using the Internet or by telephone prior to the Annual Meeting.
|
•
|
Sign another proxy card with a later date and return it to us prior to the Annual Meeting.
|
•
|
Attend the Annual Meeting in person and vote in person.
|
|
BY ORDER OF THE BOARD OF DIRECTORS
|
|
|
|
Robert W. Kamerschen
|
|
Executive Vice President, General Counsel,
|
|
Chief Administrative Officer & Corporate Secretary
|
March 28, 2019
|
|
ARTICLE 1.
|
PURPOSE AND GENERAL PROVISIONS
|
ARTICLE 2.
|
DEFINITIONS
|
ARTICLE 3.
|
ADMINISTRATION; POWERS OF THE COMMITTEE
|
ARTICLE 4.
|
SHARES AVAILABLE UNDER THE PLAN
|
ARTICLE 5.
|
STOCK OPTIONS
|
ARTICLE 6.
|
STOCK APPRECIATION RIGHTS
|
ARTICLE 7.
|
RESTRICTED STOCK AND RESTRICTED STOCK UNITS
|
ARTICLE 8.
|
PERFORMANCE SHARES AND UNITS
|
ARTICLE 9.
|
OTHER AWARDS
|
ARTICLE 10.
|
ANNUAL INCENTIVE AWARDS
|
ARTICLE 11.
|
PERFORMANCE MEASURES
|
ARTICLE 12.
|
CHANGE IN CONTROL
|
ARTICLE 13.
|
BENEFICIARY DESIGNATION
|
ARTICLE 14.
|
DEFERRALS
|
ARTICLE 15.
|
WITHHOLDING TAXES
|
ARTICLE 16.
|
AMENDMENT AND TERMINATION
|
ARTICLE 17.
|
MISCELLANEOUS PROVISIONS
|