Filed by the Registrant ☒
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Filed by a Party other than the Registrant ☐
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☒
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Preliminary Proxy Statement
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☐
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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☐
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Definitive Proxy Statement
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☐
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Definitive Additional Materials
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☐
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Soliciting Material under § 240.14a-12
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☒
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No fee required.
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☐
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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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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(4)
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Proposed maximum aggregate value of transaction
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(5)
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Total fee paid:
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☐
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Fee paid previously with preliminary materials.
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☐
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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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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No
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(3)
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Filing Party:
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(4)
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Date Filed:
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Sincerely,
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Timothy A. Peterman
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Chief Executive Officer
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1. |
To elect eight persons to serve as directors on our Board of Directors until the next Annual Meeting of Shareholders or until their successors have been duly elected and qualified;
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2. |
To approve, on an advisory basis, the 2019 compensation of the Company’s named executive officers as disclosed in the accompanying proxy statement;
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3. |
To approve the 2020 Equity Incentive Plan;
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4. |
To approve an amendment to our Articles of Incorporation to increase the number of authorized shares of common stock;
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5. |
To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending January 30, 2021; and
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6. |
To transact such other business as may properly come before the Annual Meeting, or any adjournments or postponements thereof.
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Timothy A. Peterman
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Chief Executive Officer
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June 1, 2020
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice of Internet Availability of Proxy Materials, Notice of Annual Meeting of Shareholders, Proxy Statement and Form 10-K are available at
www.proxyvote.com
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PROPOSAL NO. 1: ELECTION OF DIRECTORS
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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
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Shareholder Communications with the Board of Directors
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Attendance at Shareholder Meetings
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Composition of the Board
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Board Leadership Structure and Risk Oversight
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Director Independence
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Committees of the Board of Directors
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Director Qualifications, Board Diversity and Shareholder Nominations for Directors
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Business Ethics Policies
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Attendance and Meetings of the Board of Directors and Its Committees
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Compensation Committee Interlocks and Insider Participation
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EXECUTIVE COMPENSATION
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Executive Summary
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Compensation Discussion and Analysis
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Compensation Committee Report
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Summary Compensation Table
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Grants of Plan-Based Awards in Fiscal 2019
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Outstanding Equity Awards at Fiscal 2019 Year-End
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Option Exercises and Stock Vested
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All Other Compensation
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Severance Agreements and Severance Plan
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Potential Payments upon Termination, Non-Change in Control and After Change of Control
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Additional Potential Payments for Accelerated Equity Awards Upon Change in Control
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PROPOSAL NO. 2: ADVISORY VOTE ON EXECUTIVE COMPENSATION
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DIRECTOR COMPENSATION FOR FISCAL 2019
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PROPOSAL NO. 3: APPROVE THE 2020 EQUITY INCENTIVE PLAN
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Shareholder Approval and Board Recommendations
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Key Compensation Practices
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Description of the 2020 Plan
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U.S. Federal Income Tax Consequences
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Awards Under the 2020 Plan
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Equity Compensation Plan Information
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PROPOSAL NO. 4: AMENDMENT TO AMENDED AND RESTATED ARTICLES OF INCORPORATION TO INCREASE AUTHORIZED COMMON STOCK
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Capitalization
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Reasons for the Amendment
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Possible Effects of the Amendment
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
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Relationships and Transactions
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Related Person Transactions Approval Policy
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AUDIT COMMITTEE REPORT AND PAYMENT OF FEES TO INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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Report of the Audit Committee
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Fees Billed by Deloitte & Touche LLP
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Approval of Independent Registered Public Accounting Firm Services and Fees
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PROPOSAL NO. 5: RATIFICATION OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
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SECURITY OWNERSHIP OF PRINCIPAL SHAREHOLDERS AND MANAGEMENT
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DELINQUENT SECTION 16(a) REPORTS
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DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS FOR 2021 ANNUAL MEETING
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ANNUAL REPORT AND AVAILABLE INFORMATION
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HOUSEHOLDING OF PROXY MATERIALS
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OTHER MATTERS
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2020 EQUITY INCENTIVE PLAN
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AMENDMENT TO AMENDED AND RESTATED ARTICLES OF INCORPORATION
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PROPOSALS:
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THE BOARD’S
VOTING
RECOMMENDATIONS:
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RATIONALE FOR SUPPORT:
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FOR FURTHER
DETAILS:
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1.
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Elect the eight directors identified in this proxy statement, each for a term of one year.
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“FOR” each nominee to the Board
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Our nominees are distinguished leaders who bring a mix of skills and qualifications to the Board and can represent the interests of all shareholders.
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Page 2
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2.
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Approve the compensation of our named executive officers on an advisory basis.
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“FOR”
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Our executive compensation program is designed to attract and retain exceptional leaders and enable them to behave like owners.
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Page 25
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3
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Approve the 2020 Equity Incentive Plan.
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“FOR”
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Approval of the 2020 Equity Incentive Plan ensures that the Company can continue to grant equity-based awards in order to attract and retain talented directors and key employees.
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Page 28
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4.
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Approve the amendment to
the Company’s Articles of Incorporation to increase the number of authorized shares
of common stock.
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“FOR”
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The Board believes that the amendment is necessary to maintain flexibility to issue shares of common stock for future corporate needs.
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Page 35 |
5.
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Ratify the selection of Deloitte & Touche LLP as the Company’s independent auditor for the fiscal year ending January 30, 2021.
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“FOR”
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The Audit Committee of the Board believes that it is in the best interests of the Company and its shareholders to retain Deloitte & Touche LLP.
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Page 43
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Name
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Age
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Director Since
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Positions Currently Held with the Company
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|||
Michael Friedman
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49
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2019
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Director
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|||
Landel C. Hobbs
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57
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2014
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Chair of the Board
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|||
Benoît Jamar
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65
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2019
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Director
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|||
Jill Krueger
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60
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2019
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Director
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|||
Eyal Lalo
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45
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2019
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Vice Chair of the Board
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|||
Lisa A. Letizio
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57
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2015
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Director
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|||
Timothy A Peterman
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53
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2020
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Director
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|||
Aaron P. Reitkopf
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53
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2019
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Director
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Director
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Audit Committee
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HR and
Compensation Committee
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Governance Committee
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|||
Michael Friedman
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—
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—
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—
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|||
Landel C. Hobbs
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Member
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—
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Chair
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|||
Benoît Jamar
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Member
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—
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—
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|||
Jill Krueger
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Chair
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Member
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—
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|||
Eyal Lalo
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—
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—
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—
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|||
Lisa A. Letizio
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—
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Chair
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Member
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|||
Timothy A. Peterman
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—
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—
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—
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|||
Aaron P. Reitkopf
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—
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Member
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Member
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•
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management’s process for ensuring the integrity of the Company’s financial statements and the Company’s accounting and financial reporting processes and financial
statement audits;
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•
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the Company’s compliance with legal and regulatory requirements;
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•
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the registered public accounting firm’s (independent auditor’s) qualifications and independence;
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•
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the performance of the Company’s independent auditor and internal audit function, if applicable; and
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•
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the Company’s systems of disclosure controls and procedures and internal controls over financial reporting.
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•
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establish executive compensation strategy, including base salary, incentive compensation and any other compensation elements and evaluate the strategy in light of
the Company’s non-binding advisory say on pay vote;
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•
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ensure that all executive officers are compensated in a manner consistent with such strategy, internal considerations, competitive practices and the requirements of
regulatory agencies, and that they are not incentivized to take an undue amount of risk;
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•
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oversee our stock-based incentive plans and approve all grants to executive officers made in connection with those plans;
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•
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review and approve (i) the components of and total cash compensation for our Chief Executive Officer, and (ii) stock-based grants to our Chief Executive Officer;
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•
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review and approve any employment agreements or severance arrangements for the Chief Executive Officer or other members of senior management, including
change-in-control provisions, plans or agreements;
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•
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monitor our employee benefit plans and discharge the duties imposed on the committee by the terms of those plans;
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•
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oversee succession planning for the Chief Executive Officer and other members of the senior executive team;
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•
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annually review and recommend to the Board cash and equity compensation for members of the Board and its Committees;
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•
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review and discuss with Company management the Compensation Discussion and Analysis;
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•
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annually evaluate the performance of the committee and the adequacy of the committee’s charter, and report the evaluation to the Board; and
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•
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perform other duties or functions deemed appropriate by the Board.
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•
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Net sales of $501.8 million, a decrease of 16% from 2018 fiscal year
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•
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Gross profit of $163.6 million, a decrease of 21% from 2018 fiscal year
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•
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Gross profit as a percentage of sales was 32.6% during fiscal 2019 compared to 34.7% for fiscal 2018
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•
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Net loss was $56.3 million for fiscal 2019 versus net loss of $22.2 million for fiscal 2018
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•
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EPS of ($7.54) compared to ($3.35) for fiscal 2018
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•
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Adjusted EBITDA1 of ($18.4) million for fiscal 2019 compared to ($2.4) million for
fiscal 2018
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Name
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Title
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Timothy A. Peterman(1)
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CEO & Interim Chief Financial Officer
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Jean Sabatier
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EVP, Chief Commerce Officer
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James Spolar(2)
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Former SVP, General Counsel
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Robert J. Rosenblatt(3)
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Former Chief Executive Officer
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Diana G. Purcel(4)
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Former EVP, Chief Financial Officer
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Andrea M. Fike(5)
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Former EVP, General Counsel
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(1) |
Mr. Peterman ceased serving as an executive officer on April 16, 2018. Subsequently, since May 2, 2019, Mr. Peterman has been serving as our Chief Executive Officer.
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(2) |
Mr. Spolar’s employment with the Company terminated on February 14, 2020.
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(3) |
Mr. Rosenblatt ceased serving as our Chief Executive Officer effective May 2, 2019. Mr. Rosenblatt served as a non-employee director from May 3, 2019 to October 1, 2019.
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(4) |
Ms. Purcel’s employment with the Company terminated on May 28, 2019.
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(5) |
Ms. Fike’s employment with the Company terminated on May 28, 2019.
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|
• |
Attract, motivate and retain a highly capable and performance-focused executive team;
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• |
Promote a culture of employee owners whose financial interests are aligned with those of our shareholders;
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• |
Pay for performance such that total compensation reflects the individual performance of executives and the Company’s absolute and relative performance;
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• |
Promote a focus on equity value by tying executive compensation to the long-term enhancement of shareholder value;
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• |
Permit the HR and Compensation Committee to exercise independent judgment and approval authority with respect to establishing executive compensation programs, performance measures, and
awards; and
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|
• |
Consider the potential stock dilution, cash flow, tax and reported earnings implications of executive compensation, consistent with the other objectives of the program.
|
1-800-FLOWERS.COM, Inc.
|
Big 5 Sporting Goods Corporation
|
Build-A-Bear Workshop, Inc.
|
The Cato Corporation
|
Christopher & Banks Corporation
|
Etsy, Inc.
|
FTD Companies, Inc.
|
Lands’ End, Inc.
|
Liquidity Services, Inc.
|
Nutrisystem, Inc.
|
RTW Retailwinds
|
Shopify Inc.
|
Sleep Number Corporation
|
Trans World Entertainment Corporation
|
Tuesday Morning Corporation
|
Elements
|
Form
|
|
Purpose
|
Performance Measures
|
Fiscal 2019
Performance
Outcomes
|
|||
Base Compensation
|
Base salary paid
in the form of cash
compensation
|
Provide a fixed element of pay based on individual’s primary
duties and responsibilities
|
Company and individual performance, experience level and
contribution on
primary duties and
responsibilities
|
NEOs did not receive annual merit base pay increases
|
||||
Annual Incentive Plan
|
Performance
based cash
compensation
|
Designed to reward
achievement of specified
annual corporate goals
|
Results to be
measured against
Adjusted EBITDA, and individual performance
|
NEOs did not receive payouts based on fiscal 2019 results, as described under the caption “Annual Incentive Plan” below
|
||||
Long-Term Incentive Plan
|
Stock Options, Restricted Stock Units and Performance Share Units
|
Designed to encourage and
reward shareholder value
creation and to attract and retain talent
|
Individual’s level of responsibility and the Company’s performance
|
A long-term incentive award was granted as described under the caption “Long-Term Incentive Plan” below
|
Name
|
Target Annual Short
Term Incentive as a
Percent of Base Salary
for Fiscal 2019
|
|||||
Timothy A. Peterman
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100
|
%
|
||||
Jean Sabatier
|
60
|
%
|
||||
James Spolar
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40
|
%
|
||||
Diana G. Purcel
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60
|
%
|
||||
Andrea M. Fike
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60
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%
|
||||
Performance Measure
|
Threshold
|
Target
|
Maximum
|
Actual
|
||||||||||||
Pre-Bonus Adjusted EBITDA – Company Performance
|
$
|
0.3
|
$
|
2.6
|
$
|
13.7
|
$
|
(18.4
|
)
|
|||||||
Pre-Bonus Adjusted EBITDA – Individual Performance
|
$
|
(0.3
|
)
|
$
|
2.6
|
$
|
13.7
|
$
|
(18.4
|
)
|
Relative TSR Performance Goal
|
Number of PSUs That Vest(1)
|
||||
100th Percentile
|
150% (Maximum)
|
||||
50th Percentile
|
100% (Target)
|
||||
33rd Percentile
|
50% (Threshold)
|
||||
Less than 33rd Percentile
|
0%
|
|
|
(1) |
Vesting percentages for performance between Performance Goal data points are based on a linear interpolation.
|
Name |
Long Term
Incentive
(% of Salary)
|
Stock Options
(% of LTI)
|
RSUs
(% of LTI)
|
PSUs
(% of LTI)
|
||||||||||||||
Timothy A. Peterman
|
150
|
—
|
—
|
100
|
||||||||||||||
Jean Sabatier
|
85
|
50
|
50
|
—
|
||||||||||||||
James Spolar
|
45
|
50
|
50
|
—
|
||||||||||||||
Robert J. Rosenblatt
|
150
|
—
|
50
|
50
|
||||||||||||||
Diana G. Purcel
|
85
|
—
|
50
|
50
|
||||||||||||||
Andrea M. Fike
|
85
|
—
|
50
|
50
|
|
• |
holding any Company securities in a margin account or pledging Company securities as collateral for a loan;
|
|
• |
engaging in puts or calls or other derivative transactions relating to the Company’s securities;
|
|
• |
short-selling securities of the Company; and
|
|
• |
purchasing any financial instruments (including prepaid variable forward contracts, equity swaps, collars, and exchange funds) that are designed to hedge or offset any decrease in the
market value of any equity securities of the Company.
|
THE HUMAN RESOURCES AND
|
|
COMPENSATION COMMITTEE
|
|
LISA A. LETIZIO (CHAIR)
|
|
JILL KRUEGER
|
|
AARON REITKOPF
|
Name and Principal Position
|
Year |
Salary
($)
|
Bonus
($)
|
Stock Awards
($)(1)
|
Option
Awards
($)(2)
|
All Other
Compensation
($)
|
Total
($)
|
|||||||||||||||||||||
Timothy A. Peterman(3)
|
2019
|
480,000
|
—
|
219,860
|
(4
|
)
|
—
|
305,394
|
(5 |
)
|
|
1,005,254
|
||||||||||||||||
CEO and Interim CFO
|
2018
|
135,000
|
—
|
—
|
—
|
491,550
|
626,550
|
|||||||||||||||||||||
|
2017 |
|
|
389,923
|
—
|
148,721
|
148,436
|
112,020
|
799,100
|
|||||||||||||||||||
Jean Sabatier(6)
|
2019
|
207,692
|
—
|
39,813
|
(7
|
)
|
26,787
|
5,538
|
(8
|
)
|
|
279,830
|
||||||||||||||||
EVP and Chief
|
2018
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||
Commerce Officer
|
2017
|
71,658
|
—
|
73,992
|
73,744
|
460,374
|
679,768
|
|||||||||||||||||||||
James Spolar(9)
|
2019
|
144,231
|
12,500
|
(10
|
)
|
20,900
|
(7
|
)
|
13,926
|
4,183
|
(8
|
)
|
|
195,740
|
||||||||||||||
Former SVP, General Counsel & Secretary
|
||||||||||||||||||||||||||||
Robert J. Rosenblatt(11)
|
2019
|
201,923
|
—
|
181,871
|
(12
|
)
|
—
|
1,958,814
|
(13
|
)
|
|
2,342,608
|
||||||||||||||||
Former CEO
|
2018
|
750,000
|
—
|
523,187
|
557,212
|
199,492
|
2,029,891
|
|||||||||||||||||||||
2017
|
778,846
|
—
|
562,390
|
561,314
|
251,804
|
2,154,354
|
||||||||||||||||||||||
Diana G. Purcel(14)
|
2019
|
121,154
|
—
|
72,139
|
(15
|
)
|
—
|
441,135
|
(16
|
)
|
|
634,428
|
||||||||||||||||
Former EVP & CFO
|
2018
|
275,962
|
—
|
42,500
|
27,748
|
7,673
|
353,883
|
|||||||||||||||||||||
2017
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||
Andrea M. Fike(17)
|
2019
|
120,731
|
—
|
72,139
|
(15
|
)
|
—
|
441,122
|
(18
|
)
|
|
633,992
|
||||||||||||||||
Former EVP, General
|
2018
|
322,500
|
—
|
141,909
|
87,656
|
6,296
|
588,361
|
|||||||||||||||||||||
Counsel & Secretary
|
2017
|
229,471
|
—
|
63,000
|
43,986
|
6,326
|
342,783
|
|
(1) |
Each amount represents the grant date fair value of stock-based awards granted during the fiscal year computed in accordance with FASB ASC Topic 718.
|
|
(2) |
Each amount represents the grant date fair value of stock option awards granted during the fiscal year computed in accordance with FASB ASC Topic 718. The assumptions used to calculate
the value of the option awards granted in fiscal 2019 are set forth in Note 9, Shareholders’ Equity — Stock-Based Compensation, of the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for fiscal 2019
filed with the SEC on April 30, 2020. Amounts do not reflect compensation actually realized by the NEO.
|
|
(3) |
Mr. Peterman joined the Company as Chief Financial Officer in March 2015 and was promoted to Chief Operating Officer and Chief Financial Officer in June 2017. He served in these roles
until April 2018 and served as a non-officer employee of the Company through June 1, 2018. Mr. Peterman rejoined the Company as Chief Executive Officer on May 2, 2019.
|
|
(4) |
Amount shown represents the grant date fair value of market-based PSUs granted in fiscal 2019 in conjunction with the appointment of Mr. Peterman as CEO of the Company. Grant date fair
value was determined using a Monte Carlo valuation model based on assumptions and is consistent with the estimate of aggregate compensation cost to be recognized over the performance period determined as of the grant date under FASB ASC Topic
718, excluding the effect of estimated forfeitures. The assumptions used to calculate the value of the PSUs are set forth in Note 9, Shareholders Equity — Stock-Based Compensation, of the Notes to Consolidated Financial Statements included in
our Annual Report on Form 10-K for fiscal 2019 filed with the SEC on April 30, 2020.
|
|
(5) |
Represents relocation assistance in the amount of $294,744 and $10,650 in company matching contributions to the 401(k).
|
|
(6) |
Mr. Sabatier served as the Company’s Senior Vice President, Sales & Product Planning from 2008 to 2017 and rejoined the Company as Executive Vice President, Chief Commerce Officer in
May 2019.
|
|
(7) |
Represents RSUs awarded on May 30, 2019 to Mr. Sabatier and on August 5, 2019 to Mr. Spolar in connection with their joining the Company.
|
|
(8) |
Represents company matching contributions to the 401(k) plan.
|
|
(9) |
Mr. Spolar’s employment with the Company terminated on February 14, 2020.
|
|
(10) |
Represents a sign-on bonus paid in connection with Mr. Spolar joining the Company on August 5, 2019.
|
|
(11) |
Mr. Rosenblatt ceased serving as an executive officer on May 2, 2019. For compensation Mr. Rosenblatt received in connection with his service as a non-employee director in fiscal 2019,
please see the Director Compensation Table.
|
|
(12) |
Represents RSUs and PSUs awarded on April 1, 2019 as part of the Company’s long-term compensation program. The grant date fair value of the PSUs was determined using a Monte Carlo
simulation methodology and is based on the probable outcome of the performance measure and are consistent with the estimate of aggregate compensation cost to be recognized over the performance period determined as of the grant date under FASB
ASC Topic 718, excluding the effect of estimated forfeitures. The assumptions used to calculate the value of the PSUs are set forth in Note 9, Shareholders Equity — Stock-Based Compensation, of the Notes to Consolidated Financial Statements
included in our Annual Report on Form 10-K for fiscal 2019 filed with the SEC on April 30, 2020. At grant date, the value of the 2019 PSU awards, assuming maximum performance, would be $133,684 for Mr. Rosenblatt.
|
|
(13) |
Represents severance of $913,461 paid in fiscal 2019 and $961,539 to be paid in fiscal 2020 in connection with Mr. Rosenblatt’s termination of employment, $78,010 of reimbursed commuting
expenses and $5,804 in company matching contributions to the 401(k) plan.
|
|
(14) |
Ms. Purcel’s employment with the Company terminated on May 28, 2019.
|
|
(15) |
Represents RSUs and PSUs awarded on April 1, 2019 as part of the Company’s long-term compensation program. The grant date fair values of the PSUs were determined using a Monte Carlo
simulation methodology and are based on the probable outcome of the performance measure and are consistent with the estimate of aggregate compensation cost to be recognized over the performance period determined as of the grant date under
FASB ASC Topic 718, excluding the effect of estimated forfeitures. The assumptions used to calculate the value of the PSUs are set forth in Note 9, Shareholders Equity — Stock-Based Compensation, of the Notes to Consolidated Financial
Statements included in our Annual Report on Form 10-K for fiscal 2019 filed with the SEC on April 30, 2020. At grant date, the value of the 2019 PSU awards, assuming maximum performance, would be $53,022.
|
|
(16) |
Represents severance of $437,500 paid in fiscal 2019 pursuant to the Executives’ Severance Benefit Plan in connection with Ms. Purcel’s termination of employment and $3,635 of 401(k)
company match paid during fiscal 2019.
|
|
(17) |
Ms. Fike’s employment with the Company terminated on May 28, 2019.
|
(18) |
Represents severance of $437,500 paid in fiscal 2019 pursuant to the Executives’ Severance Benefit Plan in connection with Ms. Fike’s termination of employment and $3,622 of 401(k)
company match paid during fiscal 2019.
|
Estimated Future Payouts
Under Non-Equity
Incentive Plan Awards(1)
|
Estimated Future Payouts
Under Equity
Incentive Plan Awards
|
All Other
Stock
Awards:
Number of
Shares of Stock or
Units (#)
|
All Other
Option
Awards:
Number of
Securities Underlying
Options (#)
|
Exercise
Price or
Price of
Option Awards
($/Share)
|
Grant
Date Fair
Value of
Stock and
Option Awards
($)(2)
|
|||||||||||||||||||||||||||||||||||
Name
|
Grant
Date
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
|||||||||||||||||||||||||||||||||
Timothy A.
|
325,000
|
650,000
|
1,300,000
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||||||
Peterman
|
5/2/19
|
—
|
—
|
—
|
—
|
68,000
|
(3)
|
—
|
—
|
—
|
—
|
219,860
|
||||||||||||||||||||||||||||
Jean Sabatier
|
90,000
|
180,000
|
360,000
|
—
|
—
|
—
|
—
|
8,750
|
(4)
|
4.60
|
26,787
|
|||||||||||||||||||||||||||||
5/30/19
|
— | — | — |
—
|
—
|
— |
8,750
|
(4)
|
|
39,813
|
||||||||||||||||||||||||||||||
5/30/19
|
— | — | — | — | — | |||||||||||||||||||||||||||||||||||
James Spolar
|
60,000
|
120,000
|
240,000
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||||||
8/5/19
|
— | — | — | — | — | — | — |
|
5,000
|
(5)
|
4.10
|
13,926
|
||||||||||||||||||||||||||||
8/5/19
|
— | — | — | — | — | — |
5,000
|
(5)
|
20,900
|
|||||||||||||||||||||||||||||||
Robert J.
|
4/1/19
|
—
|
—
|
—
|
—
|
—
|
—
|
19,946(6
|
)
|
—
|
—
|
92,749
|
||||||||||||||||||||||||||||
Rosenblatt
|
4/1/19 (7)
|
—
|
—
|
—
|
8,670
|
17,339
|
26,009
|
—
|
—
|
—
|
89,122
|
|||||||||||||||||||||||||||||
Diana G.
|
105,000
|
210,000
|
420,000
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||||||
Purcel
|
4/1/19
|
—
|
—
|
—
|
—
|
—
|
—
|
7,912(6
|
)
|
—
|
—
|
36,791
|
||||||||||||||||||||||||||||
4/1/19(7)
|
— | — | — |
3,439
|
6,877
|
10,316
|
35,347
|
|||||||||||||||||||||||||||||||||
Andrea M. Fike
|
105,000
|
210,000
|
420,000
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||||||
4/1/19
|
— | — | — | — | — | — |
7,912(6)
|
— | — |
36,791
|
||||||||||||||||||||||||||||||
4/1/19(7) | — | — | — | 3,439 | 6,877 | 10,316 | — | — | — | 35,347 |
|
(1) |
Amounts in the columns above reflect possible payouts under awards made to our NEOs under our annual incentive plan described in this proxy statement under “Compensation, Discussion and
Analysis.” The actual payouts for fiscal 2019 were based on the Company achieving an Adjusted EBITDA target, and there were no payouts made to our NEOs for the fiscal 2019 non-equity annual incentive plan.
|
|
(2) |
Amounts shown equal the grant date fair value of each equity award computed in accordance with FASB ASC Topic 718. For PSUs, the grant date fair values are based on the probable outcome
of the performance measure and are consistent with the estimate of aggregate compensation cost to be recognized over the performance period determined as of the grant date under FASB ASC Topic 718, excluding the effect of estimated
forfeitures.
|
|
(3) |
The PSUs were granted to Mr. Peterman outside of a plan in connection with his rejoining the Company. The PSUs vest in three tranches, each tranche consisting of one-third of the units
subject to the award. Tranche 1 vested on May 2, 2020, the one-year anniversary of the grant date. Tranche 2 will vest on the date the Company’s average closing stock price for 20 consecutive trading days equals or exceeds $20.00 per share
and Mr. Peterman has been continuously employed at least one year. Tranche 3 will vest on the date the Company’s average closing stock price for 20 consecutive trading days equals or exceeds $40.00 per share and Mr. Peterman has been
continuously employed at least two years. The vesting of the second and third tranches can occur any time on or before May 1, 2029.
|
|
(4) |
Stock options and RSUs granted on May 30, 2019 under the 2011 Omnibus Incentive Plan (the “2011 Plan”) were made in conjunction with the hiring and appointment of Mr. Sabatier as EVP and
Chief Commerce Officer on May 30, 2019. These awards vest in equal annual installments over a three-year period beginning on the first anniversary date of grant.
|
|
(5) |
Stock options and RSUs granted on August 5, 2019 under the 2011 Plan were made in conjunction with the hiring and appointment of Mr. Spolar as SVP, General Counsel on August 5, 2019.
These awards vest in equal annual installments over a three-year period beginning on the first anniversary date of grant.
|
|
(6) |
RSUs granted on April 1, 2019 under the 2011 Plan in connection with the Company’s annual long-term executive compensation program. These awards vest in equal annual installments over a
three-year period beginning on the first anniversary date of grant.
|
|
(7) |
PSUs granted on April 1, 2019 under the 2011 Plan in connection with the Company’s long-term equity incentive plan described under “Compensation Discussion and Analysis.” The number of
PSUs earned is based on the Company’s total shareholder return relative to a group of industry peers over a three-year performance measurement period as described in footnote 5 to the Outstanding Equity Awards at Fiscal 2019 Year-End table
below.
|
OPTION AWARDS
|
STOCK AWARDS
|
|||||||||||||||||||||||||||||||||
Number of Securities
Underlying Unexercised
Options
|
Option
Exercise
Price
($/Share)
|
Option
Expiration
Date
|
Shares or Units of Stock
That Have Not Vested
|
Equity Incentive Plan
Awards: Unearned Shares,
Units or Other Rights That
Have Not Vested
|
||||||||||||||||||||||||||||||
Name
|
Grant
Date
|
Exercisable
(#)
|
Unexercisable
(#)
|
Number
|
Market
Value($)(1)
|
Number
|
Market or Payout
Value($)(1)
|
|||||||||||||||||||||||||||
Timothy A. Peterman
|
5/2/19
|
—
|
—
|
—
|
—
|
22,666(2)
|
82,731
|
45,334(2)
|
165,469
|
|||||||||||||||||||||||||
Jean Sabatier
|
5/30/19
|
—
|
8,750(3)
|
4.60
|
5/30/29
|
8,750(3)
|
31,938
|
—
|
—
|
|||||||||||||||||||||||||
James Spolar
|
8/5/19
|
—
|
5,000(3)
|
4.10
|
8/5/29
|
5,000(3)
|
18,250
|
—
|
—
|
|||||||||||||||||||||||||
Robert J.
|
6/23/14
|
5,000(4)
|
—
|
49.80
|
6/23/24
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||||||
Rosenblatt
|
8/18/16
|
37,585(3)
|
—
|
16.00
|
3/28/26
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||||||
3/27/17
|
40,326(3)
|
20,162(3)
|
13.30
|
3/27/27
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||
3/26/18
|
28,448(3)
|
56,895(3)
|
10.00
|
3/26/28
|
—
|
—
|
—
|
—
|
||||||||||||||||||||||||||
3/26/18
|
—
|
—
|
—
|
—
|
—
|
—
|
24,448(5)
|
89,235
|
||||||||||||||||||||||||||
4/1/19
|
—
|
—
|
—
|
—
|
19,946(3)
|
72,803
|
—
|
—
|
||||||||||||||||||||||||||
4/1/19
|
—
|
—
|
—
|
—
|
—
|
—
|
8,670(5)
|
31,644
|
||||||||||||||||||||||||||
7/12/19
|
—
|
—
|
—
|
—
|
7,558(6)
|
27,587
|
—
|
—
|
|
(1) |
Market value of unvested or unearned shares is based on the $3.65 closing price of our common stock on January 31, 2020, the last trading day prior to the completion of our 2019 fiscal
year.
|
|
(2) |
The PSU award vests in three tranches. Tranche 1 (one-third of the shares subject to the award) vested on May 2, 2020, the one-year anniversary of the grant date. Tranche 2 (one-third)
will vest on the date the Company’s average closing stock price for 20 consecutive trading days equals or exceeds $20.00 per share and the executive has been continuously employed at least one year. Tranche 3 (one-third) will vest on the date
the Company’s average closing stock price for 20 consecutive trading days equals or exceeds $40.00 per share and the executive has been continuously employed at least two years. The vesting of the second and third tranches can occur any time
on or before May 1, 2029 if the executive has been continuously employed through the vesting date.
|
|
(3) |
Options and RSUs vest in three equal annual installments beginning on the first anniversary of the date of grant.
|
|
(4) |
Amount represents the options granted to Mr. Rosenblatt on June 23, 2014 while holding the position of chairman of the Board. The options vested in full on the date of grant.
|
|
(5) |
The number of market-based PSUs earned will be based on the Company’s TSR relative to a group of industry peers over a three-year performance measurement period. The percent of the target
number of PSUs that will be earned based on the Company’s TSR percentile rank relative to the peer group is as follows: percentile rank below 33%, 0% vests; percentile rank of 33%, 50% vests; percentile rank of 50%, 100% vests and percentile
rank of 100%, 150% vests. Vesting percentages for performance between performance goal data points will be based on a linear interpolation. The number of PSUs reported in the table reflects the threshold number of PSUs granted.
|
|
(6) |
Amount represents RSUs granted to Mr. Rosenblatt on July 12, 2019 while serving on our Board of Directors. The RSUs vest in full on the day before our 2020 Annual Meeting.
|
Option Awards
|
Stock Awards
|
|||||||||||||||
Name
|
Number of Shares
Acquired on Exercise (#)
|
Value Realized
on Exercise ($)
|
Number of Shares
Acquired on
Vesting (#)
|
Value Realized
on Vesting ($)(1)
|
||||||||||||
Timothy A. Peterman
|
—
|
—
|
—
|
—
|
||||||||||||
Jean Sabatier
|
—
|
—
|
—
|
—
|
||||||||||||
James Spolar
|
—
|
—
|
—
|
—
|
||||||||||||
Robert J. Rosenblatt
|
—
|
—
|
—
|
—
|
||||||||||||
Diana G. Purcel
|
—
|
—
|
1,666
|
7,164
|
||||||||||||
Andrea M. Fike
|
—
|
—
|
4,084
|
17,169
|
|
(1) |
Represents the market value of the common stock on the date of vesting.
|
Executive Level
|
Cash Severance Amount
|
||
Tier I Executive
(Chief Executive Officer and Executive Vice Presidents)
|
An amount equal to 1 ¼ times the Executive’s highest base salary.
|
||
Tier II Executive
(Senior Vice Presidents)
|
1 times the Executive’s highest annual rate of base salary during the 12-month period immediately preceding the date that the Executive separates from the Company
|
Executive Level
|
Cash Severance Amount
|
||
Tier I Executive
(Chief Executive Officer and Executive Vice Presidents)
|
The sum of:
• 1 ½ times the Executive’s highest annual rate of base salary during the 12-month period immediately preceding the date that the Executive separates from service; and
• 1 ½ times the target annual incentive bonus determined from such base salary.
|
||
Tier II Executive
(Senior Vice Presidents)
|
The sum of:
• 1 ¼ times the Executive’s highest annual rate of base salary during the 12-month period immediately preceding the date that the Executive separates from service, and
• 1 ¼ times the target annual incentive bonus determined from such base salary.
|
Name
|
Non-Change of
Control &
Qualifying
Termination
|
Change of
Control &
Qualifying
Termination
|
|||||||
Timothy A. Peterman
|
$
|
812,500
|
$
|
1,950,000
|
|||||
Jean Sabatier
|
$
|
375,000
|
$
|
720,000
|
|||||
James Spolar
|
$
|
300,000
|
$
|
525,000
|
|||||
Robert J. Rosenblatt
|
$
|
1,875,000
|
n/a
|
||||||
Diana G. Purcel
|
$
|
437,500
|
n/a
|
||||||
Andrea M. Fike
|
$
|
437,500
|
n/a
|
Name
|
Value of
Accelerated
RSUs ($)
|
|||||
Timothy A. Peterman
|
82,731
|
|||||
Jean Sabatier
|
31,938
|
|||||
James Spolar
|
18,250
|
|||||
Robert J. Rosenblatt
|
100,390
|
Annual Compensation Element(1)
|
Compensation Value $
|
|||
Cash Retainer
|
65,000
|
|||
Chair Supplemental Cash Retainer
|
130,000
|
|||
Vice Chair Supplemental Cash Retainer (if applicable)
|
105,000
|
|||
Audit Committee Chair Cash Retainer
|
20,000
|
|||
HR and Compensation Committee Chair Cash Retainer
|
15,000
|
|||
Governance Committee Chair Cash Retainer
|
12,000
|
|||
Audit Committee Member Retainer
|
10,000
|
|||
Equity Award
|
65,000
|
(2)
|
|
(1) |
Cash retainers are payable on a quarterly basis in arrears promptly following the end of each fiscal quarter, and subject to pro rata adjustment if the director did not serve the entire
quarter.
|
|
(2) |
Annual equity award vests in full one-year after the grant date (typically the annual meeting date).
|
Current Non-Employee
Board Members:
|
Fees Earned or
Paid in Cash ($)
|
Stock
Awards ($)(1)(2)
|
Option
Awards ($)(2)
|
Total ($)
|
||||||||||||
Michael Friedman
|
48,573
|
39,977
|
—
|
88,550
|
||||||||||||
Landel C. Hobbs
|
130,000
|
32,499
|
—
|
162,499
|
||||||||||||
Benoît Jamar
|
39,782
|
32,499
|
—
|
72,281
|
||||||||||||
Jill Krueger
|
31,875
|
—
|
—
|
31,875
|
||||||||||||
Eyal Lalo (3)
|
48,573
|
39,977
|
—
|
88,550
|
||||||||||||
Lisa A. Letizio
|
83,396
|
32,499
|
—
|
115,895
|
||||||||||||
Aaron P. Reitkopf
|
36,033
|
32,499
|
—
|
68,532
|
||||||||||||
Former Board Members:
|
||||||||||||||||
Thomas D. Beers (4)
|
19,158
|
—
|
—
|
19,158
|
||||||||||||
Neal S. Grabell (5)
|
52,201
|
32,499
|
—
|
84,700
|
||||||||||||
Mark K. Holdsworth (4)
|
21,712
|
—
|
—
|
21,712
|
||||||||||||
Robert J. Rosenblatt (6)
|
27,024
|
32,499
|
—
|
59,523
|
||||||||||||
Fred R. Siegel (7)
|
29,144
|
—
|
—
|
29,144
|
||||||||||||
Alex B. Spiro (7)
|
39,008
|
—
|
—
|
39,008
|
(1)
|
Amounts reported represent 100% of the grant date fair value of the RSU grant of 7,558 shares given to each of the directors. The valuation of these awards, in
accordance with FASB Topic 718, is based on the closing price of our common stock on July 12, 2019, the date of grant. These shares are restricted and vest in full on the day before our 2020 Annual Meeting. The non-employee directors did
not receive the full $65,000 RSU grant in fiscal 2019 given the limited shares available under the 2011 Omnibus Incentive Plan. For Mr. Friedman and Mr. Lalo, the amount also includes 100% of the grant date fair value of 2,043 RSUs granted
to Mr. Friedman and Mr. Lalo upon their appointment as director on May 2, 2019, which vested in full on July 11, 2019.
|
|
|
(2)
|
As of February 1, 2020, our non-employee directors held unvested RSUs and options as follows:
|
|
|
Name
|
Unvested RSUs (#)
|
Options (#)
|
||||||
Michael Friedman
|
7,558
|
—
|
||||||
Landel C. Hobbs
|
7,558
|
3,000
|
||||||
Benoît Jamar
|
7,558
|
—
|
||||||
Jill Krueger
|
—
|
—
|
||||||
Eyal Lalo
|
7,558
|
—
|
||||||
Lisa A. Letizio
|
7,558
|
—
|
||||||
Aaron P. Reitkopf
|
7,558
|
—
|
(3)
|
Mr. Lalo declined to receive his full annual cash retainer for service as vice chairperson of the Board in fiscal 2019.
|
|
|
(4)
|
Resigned from the Board effective May 2, 2019.
|
|
|
(5)
|
Resigned from the Board effective September 11, 2019.
|
|
|
(6)
|
Mr. Rosenblatt served as a non-employee director from May 3, 2019 to October 1, 2019.
|
|
|
(7)
|
Ceased serving as directors on July 12, 2019, the date of our 2019 Annual Meeting of Shareholders.
|
•
|
No repricing of underwater options or stock appreciation rights without shareholder approval. The 2020 Plan prohibits,
without shareholder approval, actions to reprice, replace, or repurchase options or stock appreciation rights (“SARs”) when the exercise price per share of an option or SAR exceeds the fair market value of the underlying shares.
|
|
|
•
|
No discounted option or SAR grants. The 2020 Plan requires that the exercise price of options or SARs be at least equal to
the fair market value of our common stock on the date of grant (except in the limited case of “substitute awards” as described below).
|
|
|
•
|
No liberal definition of “change in control.” No change in control would be triggered by shareholder approval of a business
combination transaction, the announcement or commencement of a tender offer or any board assessment that a change in control may be imminent.
|
|
|
•
|
No automatic accelerated vesting of equity awards upon a change in control.
|
|
|
•
|
Limits on dividends and dividend equivalents. The 2020 Plan prohibits the payment of dividend equivalents on stock options
and SARs, and requires that any dividends and dividend equivalents payable or credited on unvested awards other than options and SARs (“full value awards”) must be subject to the same restrictions and risk of forfeiture as the underlying
shares or share equivalents.
|
|
|
•
|
A “corporate transaction” generally means (i) a sale or other disposition of all or substantially all of the assets of the Company, or (ii) a merger, consolidation,
share exchange or similar transaction involving the Company.
|
|
|
•
|
A “change in control” generally refers to a corporate transaction (as defined above), the acquisition by a person or group of beneficial ownership of 33.33% or more
of the voting power of our stock, or our “continuing directors” ceasing to constitute a majority of our board.
|
|
|
Name & Principal Position
|
RSU Awards
|
||||
Timothy A. Peterman
|
73,728
|
||||
CEO & Interim Chief Financial Officer
|
|||||
All current executive officers
|
73,728
|
||||
All current directors who are not executive officers
|
—
|
||||
All employees who are not executive officers
|
—
|
Plan Category
|
Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights
|
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights(1)
|
Number of Securities
Remaining Available for
Future Issuance under Equity
Compensation Plans
(excluding securities reflected
in 1st column)
|
|||||||||
Equity Compensation Plans Approved by Security Holders
|
524,193
|
(2)
|
$ 13.39
|
433,423
|
(3)
|
|||||||
Equity Compensation Plans Not Approved by Security Holders
|
334,667
|
(4)
|
n/a
|
—
|
||||||||
Total
|
858,860
|
$ 13.39
|
433,423
|
(1)
|
RSUs and PSUs are excluded when determining the weighted-average exercise price of options.
|
|
|
(2)
|
Includes outstanding options, RSUs and PSUs.
|
|
|
(3)
|
Includes securities available for future issuance under shareholder approved compensation plans other than upon the exercise of outstanding options, warrants or
rights, as follows: 433,423 shares under the 2011 Plan.
|
|
|
(4)
|
Includes 266,667 RSUs granted in connection with a commercial agreement with ABG-Shaq-LLC and 68,000 PSUs granted to Timothy A. Peterman in connection with his
appointment as Chief Executive Officer.
|
•
|
8,972,816 were issued and outstanding;
|
|
|
•
|
227,787 were reserved for issuance upon exercise of outstanding stock options;
|
|
|
•
|
1,102,127 were reserved for issuance upon exercise of outstanding warrants;
|
|
|
•
|
1,219,075 were reserved for share issuances in subsequent closings pursuant to the Common Stock and Warrant Purchase Agreement, dated as of April 14, 2020, by and
between iMedia Brands, Inc. and the purchasers listed therein (the “Securities Purchase Agreement”);
|
|
|
•
|
611,993 were reserved for warrant issuances in subsequent closings pursuant to the Securities Purchase Agreement;
|
|
|
•
|
50,000 were reserved for contingent consideration resulting from a business acquisition;
|
|
|
•
|
632,394 were reserved for issuance for RSUs;
|
|
|
•
|
348,295 were reserved for issuance for PSUs; and
|
|
|
•
|
51,152 were reserved and remain available for future grants under our 2011 Omnibus Incentive Plan.
|
|
|
•
|
a vendor exclusivity agreement between the Company and Vendor, whereby
|
|
|
o
|
during the period beginning with the Effective Date and ending on the fifth anniversary of the Effective Date (or on the earlier termination of the Vendor
Exclusivity Agreement) (the “Non-Competition Period”), Vendor and its affiliates and any spokesperson for the Products will not provide any rights to certain parties engaged in television shopping to use the trademarks associated with the
Products or market, promote or sell the Products or any similar or competitive goods or services;
|
|
|
o
|
during the Non-Competition Period, Vendor grants the Company the right to market, promote and sell, through live or taped direct response video retail programming
in the U.S. and Canada, the Products and any similar or competitive goods or services; and
|
|
|
o
|
the vendor exclusivity agreement is terminable by either party one year following a change in control of the Company.
|
|
|
•
|
a vendor agreement between the Company and Vendor, whereby Vendor grants the Company a license to the trademarks related to the Products and agrees to take other
actions to assist us in marketing the Products, for a five-year term;
|
|
|
•
|
a letter agreement between the Company and IWCA (the “IWCA Letter Agreement”), whereby IWCA agrees to take, or refrain from taking as applicable, actions in support
of the arrangements between the Company and Vendor;
|
|
|
•
|
a merchandise letter agreement between the Company and Vendor, whereby Vendor commits to purchase Products from IWCA in an amount no less than $25 million for offer
to the Company for the fall season of 2019; and
|
|
|
•
|
a clawback agreement from each purchaser, whereby each purchaser agrees that in the event of an uncured breach of any of the IWCA Letter Agreement or Vendor
Exclusivity Agreement, the warrants will be immediately cancelled and, for the shares purchased by Invicta Media, Michael and Leah Friedman and Timothy Peterman, we will have the right to repurchase the shares of common stock issued
pursuant to the purchase agreement at a price of $3.73 per share or, if such shares have already been sold, we will be entitled to a cash payment equal to $3.77 per share.
|
|
|
•
|
any employment by the Company of an executive officer of the Company if (a) the related compensation is required to be reported in the Company’s proxy statement
under Item 402 of Regulation S-K or (b) the executive officer is not an immediate family member of another executive officer, director or 5% or greater shareholder of the Company, the related compensation would be reported in the Company’s
proxy statement under Item 402 of Regulation S-K if the executive officer was a “named executive officer,” and the Company’s Compensation Committee approved (or recommended that the Board approve) the compensation;
|
|
|
•
|
any compensation paid to a director if the compensation is required to be reported in the Company’s proxy statement under Item 402 of Regulation S-K;
|
|
|
•
|
any transaction in which the related person’s interest arises solely from the ownership of the Company’s common stock and all holders of the Company’s common stock
received the same benefit on a pro rata basis (e.g., dividends);
|
|
|
•
|
any transaction with another company at which a related person’s only relationship is as an employee (other than executive officer), director or beneficial owner of
less than 10% of that company’s shares, if the aggregate amount does not exceed the greater of $1,000,000 or 2% of that company’s total annual revenues; and
|
|
|
•
|
any transaction with a related person involving services as a bank depositary of funds, transfer agent, registration, trustee under a trust indenture, or similar
services.
|
|
|
THE AUDIT COMMITTEE
|
|
JILL KRUEGER (CHAIR)
|
|
LANDEL C. HOBBS
|
|
BENOÎT JAMAR
|
Description of Fees
|
Fiscal 2019
Amount
|
Fiscal 2018
Amount
|
||||||
Audit Fees
|
$
|
457,000
|
$
|
457,000
|
||||
Audit-Related Fees
|
224,600
|
62,600
|
||||||
Total Audit and Audit-Related Fees
|
681,600
|
519,600
|
||||||
Tax Compliance Fees
|
98,600
|
84,200
|
||||||
Tax Consultation and Advice Fees
|
41,300
|
60,100
|
||||||
Total Tax Fees
|
139,900
|
144,300
|
||||||
All Other Fees
|
—
|
—
|
||||||
Total
|
$
|
821,500
|
$
|
663,900
|
|
1. |
To elect eight persons to serve as directors on the Board until the next Annual Meeting of Shareholders or until their successors have been duly elected and qualified;
|
|
2. |
To approve, on an advisory basis, the 2019 compensation of the Company’s named executive officers as disclosed in the proxy statement;
|
|
3. |
To approve the 2020 Equity Incentive Plan;
|
|
4. |
To approve an amendment to our Articles of Incorporation to increase the number of authorized shares of common stock;
|
|
5. |
To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending January 30, 2021; and
|
|
6. |
To transact such other business as may properly come before the Annual Meeting, or any adjournments or postponements thereof.
|
•
|
The Board recommends a vote FOR all eight of the director nominees.
|
|
|
•
|
The Board recommends a vote FOR approval, on an advisory basis, of the 2019 compensation of the Company’s named executive officers as disclosed in this proxy
statement.
|
|
|
•
|
The Board recommends a vote FOR approval of the 2020 Equity Incentive Plan.
|
|
|
•
|
The Board recommends a vote FOR approval of an amendment to the Amended and Restated Articles of Incorporation to increase the number of authorized shares of
common stock.
|
|
|
•
|
The Board recommends a vote FOR ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for
the year ending January 30, 2021.
|
•
|
FOR the election of all eight of the director nominees;
|
|
|
•
|
FOR the advisory approval of the 2019 compensation of the Company’s named executive officers;
|
|
|
•
|
FOR approval of the 2020 Equity Incentive Plan;
|
|
|
•
|
FOR approval of an amendment to the Amended and Restated Articles of Incorporation to increase the number of authorized shares of common stock; and
|
|
|
•
|
FOR ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm as the Company’s independent
registered public accounting firm for the year ending January 30, 2021.
|
|
|
•
|
Voting by Internet. You can vote over the Internet using the procedures and instructions described on the Notice Regarding Availability of Proxy Materials or
proxy card. If you received a proxy card and vote over the Internet, you need not return your proxy card.
|
|
|
•
|
Voting by Telephone. You can vote by telephone using the directions on your proxy card by calling the toll-free number printed on the card. If you received a
proxy card and vote by telephone, you need not return your proxy card.
|
|
|
•
|
Voting by Proxy Card. You can vote by completing and returning your signed proxy card. To vote using your proxy card, please mark, date and sign the card and
return it by mail in the accompanying postage-paid envelope. You should mail your signed proxy card sufficiently in advance for it to be received by July 13, 2020.
|
|
|
•
|
Voting in Person. You can vote in person at the Annual Meeting if you are the record owner of the shares to be voted. If you hold your shares in “street name”
(that is, through a broker or other nominee) and you wish to vote your shares at the Annual Meeting instead of by proxy, you will need to bring a legal proxy issued to you by your broker or other nominee entitling you to vote in person.
|
•
|
signing and delivering to our Corporate Secretary a new proxy or a notice stating that your proxy is being revoked prior to the Annual Meeting;
|
|
|
•
|
calling the toll-free number on your proxy card and following the instructions to vote again, or by accessing the web site printed on your Notice Regarding
Availability of Proxy Materials or proxy card and following the instructions to vote again; or
|
|
|
•
|
attending the Annual Meeting and voting at the Annual Meeting.
|
|
|
Name and Address of Beneficial Owner
|
Title of Class
|
Number of Shares
Beneficially Owned
|
Percent of
Class
|
||||||
Non-Employee Directors and Director Nominees:
|
|||||||||
Michael Friedman(1)
|
Common
|
828,500
|
8.90
|
%
|
|||||
Landel C. Hobbs(2)
|
Common
|
49,780
|
*
|
||||||
Benoît Jamar(3)
|
Common
|
7,558
|
*
|
||||||
Jill Krueger(4)
|
Common
|
4,930
|
*
|
||||||
Eyal Lalo(5)
|
Common
|
1,151,853
|
12.15
|
%
|
|||||
Lisa A. Letizio(3)
|
Common
|
31,281
|
*
|
||||||
Aaron P. Reitkopf(3)
|
Common
|
7,558
|
*
|
||||||
Named Executive Officers:
|
|||||||||
Timothy A. Peterman(6)
|
Common
|
62,823
|
*
|
||||||
Jean Sabatier(7)
|
Common
|
23,299
|
*
|
||||||
James Spolar
|
Common
|
—
|
*
|
||||||
Robert J. Rosenblatt(8)
|
Common
|
299,969
|
3.26
|
%
|
|||||
Diana G. Purcel
|
Common
|
1,666
|
*
|
||||||
Andrea M. Fike
|
Common
|
—
|
*
|
||||||
All directors and executive officers as a group (9 persons)(9)
|
Common
|
2,167,582
|
21.98
|
%
|
|||||
5% or Greater Shareholders:
|
|||||||||
Invicta Media Investments, LLC (10)
|
Common
|
1,980,353
|
20.18
|
%
|
|||||
3069 Taft Street
|
|||||||||
Hollywood, Florida 33021
|
|
(1) |
Includes 7,558 unvested RSUs and warrants to purchase 84,218 shares of common stock that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020. Also
includes 242,340 shares of common stock to be purchased within 60 days of May 2, 2020 pursuant to a common stock and warrant purchase agreement entered into on April 14, 2020.
|
|
(2) |
Includes options to purchase and unvested RSUs covering a total of 10,558 shares that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020.
|
|
(3) |
Includes 7,558 unvested RSUs that may vest within 60 days of May 2, 2020.
|
|
(4) |
Includes 4,930 unvested RSUs that may vest within 60 days of May 2, 2020.
|
|
(5) |
Includes 644,798 shares held by Invicta Media, a subsidiary of IWCA owned by Mr. Lalo. Also includes 7,558 unvested RSUs and warrants to purchase 252,656 shares of common stock that are
presently exercisable or may become exercisable or vest within 60 days of May 2, 2020. Also includes 244,798 shares of common stock to be purchased within 60 days of May 2, 2020 pursuant to a common stock and warrant purchase agreement
entered into on April 14, 2020.
|
|
(6) |
Includes warrants to purchase 7,291 shares of common stock that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020.
|
|
(7) |
Includes options to purchase and unvested RSUs covering a total of 5,834 shares that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020.
|
|
(8) |
Includes options to purchase and unvested RSUs covering a total of 216,137 shares that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020.
|
|
(9) |
Includes options and warrants to purchase and unvested RSUs covering a total of 403,277 shares that are presently exercisable or may become exercisable or vest within 60 days of May 2,
2020. Also includes 487,138 shares of common stock to be purchased within 60 days of May 2, 2020 pursuant to a common stock and warrant purchase agreement entered into on April 14, 2020.
|
|
(10) |
Includes 15,116 unvested RSUs and warrants to purchase 336,874 shares of common stock that are presently exercisable or may become exercisable or vest within 60 days of May 2, 2020.
Also includes 487,138 shares of common stock to be purchased within 60 days of May 2, 2020 pursuant to a common stock and warrant purchase agreement entered into on April 14, 2020. The purchase agreement contains blocker provisions whereby
no purchaser may be issued shares of our common stock if the purchaser would own over 19.999% of our outstanding common stock and no purchaser of warrants may exercise a warrant if the holder would own over 19.999% of our outstanding common
stock. Additional information can be found in the joint Schedule 13D/A filed on April 24, 2020 by Invicta Media, IWCA, Eyal Lalo, Michael Friedman and Leah Friedman.
|
|
Timothy A. Peterman
|
A. |
The Corporation is authorized to issue Ten Million (10,000,000) shares of capital stock and Twenty Million (20,000,000)
|
B. |
In addition to any and all powers conferred upon the Board of Directors by the laws of the State of Minnesota, the Board of Directors shall have the authority to establish by resolution
more than one class or series of shares, either preferred or common, and to fix the relative rights, restrictions and preferences of any such different classes or series, and the authority to issue shares of a class or series to another class
or series to effectuate share dividends, splits or conversion of the Corporation’s outstanding shares.
|
C. |
The Board of Directors shall also have the authority to issue rights to convert any of the Corporation’s securities into shares of stock of any class or classes, the authority to issue
options to purchase or subscribe for shares of stock of any class or classes, and the authority to issue share purchase or subscription warrants or any other evidence of such option rights which set forth the terms, provisions and conditions
thereof, including the price or prices at which such shares may be subscribed for or purchased. Such options, warrants and rights, may be transferable or nontransferable and separable or inseparable from other securities of the Corporation.
The Board of Directors is authorized to fix the terms, provisions and conditions of such options, warrants and rights, including the conversion basis or bases and the option price or prices at which shares may be subscribed for or purchased.
|