| (5) | Amounts shown in Column (e) above(i) for Mr. Reddy and the fiscal 2018 amount in Column (f)2020 consist of, for Mr. Reddy represents the annual equity awards granted to Mr. Reddy in fiscal 2018 based on performance in fiscal 2017. For more information, see footnote (4) to “Grants of Plan-Based Awards in Fiscal 2018” below. The fiscal 2017 amount in Column (e) above for(i) Mr. Paul Marciano, home security ($167,238), automobile expenses, including fuel, maintenance and insurance ($64,227), health insurance related expenses ($33,347), and matching contributions to the Company’s 401(k) Plan (or to Mr. Herrero representsPaul Marciano’s DCP to “make up” for 401(k) match amounts that could not be made to the fair valueCompany’s 401(k) Plan) ($8,433), (ii) Mr. Alberini, automobile expenses, including fuel, maintenance and insurance ($22,747) and health insurance related expenses ($29,945), and (iii) Sandeep Reddy, health insurance related expenses ($17,944), matching contributions to the Company’s 401(k) Plan (or to Mr. Reddy’s DCP to “make up” for 401(k) match amounts that could not be made to the Company’s 401(k) Plan) ($6,245), the accrued cash severance benefit ($650,000) pursuant to his Separation Agreement (as described under “Potential Payments Upon Termination or Change in Control” below) and the accrued and unused vacation benefits paid under his Separation Agreement ($75,000). On occasion, when our Named Executive Officers travel on an aircraft leased or chartered by the Company for business purposes, a personal guest of three performance-based awards of restricted stock units grantedthe executive may accompany the executive by occupying a seat on the aircraft that would otherwise be unoccupied. In these situations, any incremental cost to each executive during fiscal 2017 ($1,235,010the Company for the 2017 Licensing Award, $1,235,002personal air travel is paid for or reimbursed by the 2017 Relative TSR Award and $999,983 for the 2017 LTIP Award as to theexecutive. During fiscal 2017 awards for Mr.2020, Messrs. Paul Marciano and $900,012Alberini were each entitled to the use of a Company-provided automobile. Incremental cost to the Company for the 2017use of Company-owned automobiles was calculated based on an Internal Revenue Award, $900,000Service formula for valuing the 2017 Relative TSR Award and $999,983 for the 2017 LTIP Award asuse of Company-owned automobiles. Incremental cost to the fiscal 2017 awardsCompany for Mr. Herrero), determined as of the grant date under generally accepted accounting principles based on the probable outcome of the performance conditions applicable to the awards. The grant date fair value of the 2017 Licensing Award and the 2017 Revenue Award assuming the maximum level of performance applicable to the awards would be achieved was the same as the grant date fair value of those awards based on the probable outcome of the performance condition applicable to those awards. The grant date fair value of the 2017 Relative TSR Awards assuming the maximum level of performance applicable to the awards would be achieved was $1,852,503 for Mr. Paul Marciano’s award and $1,350,000 for Mr. Herrero’s award. The grant date fair value of each 2017 LTIP Award assuming the maximum level of performance applicable to the award would be achieved was $1,999,966. Of the fiscal 2017 amount in Column (e) above for Mr. Reddy, $419,995 represents the fair value of the 2017 LTIP Award granted to Mr. Reddy, determined as of the grant date under generally accepted accounting principles based on the probable outcome of the performance conditions applicable to the award. The grant date fair value of Mr. Reddy’s 2017 LTIP Award assuming the maximum level of performance applicable to the award would be achieved was $839,990.
The fiscal 2016 amount in Column (e) above for Mr. Paul Marciano represents the fair value of two performance-based awards of restricted stock units granted to him during fiscal 2016 ($3,249,996 for the 2016 TSR Award and $3,250,004 for the 2016 Licensing Award), determined as of the grant date under generally accepted accounting principles based on the probable outcome of the performance conditions applicable to the awards. The grant date fair value of the 2016 TSR Award assuming the maximum level of performance applicable to the award would be achieved was $4,873,921. The grant date fair value of the 2016 Licensing Award assuming the maximum level of performance applicable to the award would be achieved was the same as the grant date fair value of that award based on the probable outcome of the performance condition applicable to that award. In addition, the fiscal 2016 amount in Column (e) above for Mr. Herrero includes $5,007,500, which represents the fair value of a performance-based award of restricted stock units granted to him during fiscal 2016, determined as of the grant date under generally accepted accounting principles based on the probable outcome of the performance conditions applicable to the award. The grant date fair value of this award assuming the maximum levels of performance applicable to these awards would be achieved was the same as the grant date fair value of that award based on the probable outcome of the performance condition applicable to that award.
(2) | The amounts reported in Column (g) above reflect the aggregate dollar amounts paid to Named Executive Officers as cash incentive awards with respect to performance for the covered fiscal years under the terms of the Company’s Bonus Plan. The annual cash incentive awards reported in Column (g) for each fiscal year were generally paid in the first quarter of the following fiscal year. |
(3) | Amounts reported in Column (h) represent the annual changes in the actuarial present value of Mr. Paul Marciano’s accrued aggregate pension benefit with respect to the Company’s Supplemental Executive Retirement Plan, or SERP. None of the other Named Executive Officers participate in the SERP. See “Pension Benefits Table—Fiscal 2018” below for a discussion of the change in the actuarial present value of Mr. Paul Marciano’s benefit for fiscal 2018. While the actuarial present value of Mr. Paul Marciano’s benefit increased in fiscal 2018, fiscal 2017 and fiscal 2016 as compared to the immediately preceding fiscal years, the reported amounts for fiscal 2018, fiscal 2017 and fiscal 2016 for Mr. Paul Marciano are $0 because he has overall experienced a net loss in the actuarial present value of his accrued pension benefit since fiscal 2012 (as described in more detail under the “Pension Benefits Table—Fiscal 2018” below). The actuarial present value of accrued benefits is based on the RP 2014 Mortality Table with MP 2015 Mortality Projections for fiscal 2016, on the RP 2014 Mortality Table with MP 2016 Mortality Projections for fiscal 2017, and on the RP 2014 Mortality Table with MP 2017 Mortality Projections for fiscal 2018; a discount rate of 3.5%; and an assumed retirement age of 67. The assumptions used are the same as those used for financial reporting purposes and contained in Note 12 (Defined Benefit Plans) to the Company’s Consolidated Financial Statements, included as part of the Company’s Fiscal 2018 Annual Report on Form 10-K. See the “Pension Benefits Table—Fiscal 2018” below. |
No amounts areother item included in Column (h) for earnings on deferred compensation under(i) was calculated using the Company’s Non-Qualified Deferred Compensation Plan becauseactual cost to the Named Executive Officers do not receive above-market or preferential earnings on compensation that is deferred under this plan. The earnings that the Named Executive Officers received during fiscal 2018 on compensation deferred under the Non-Qualified Deferred Compensation Plan are reported in the “Non-Qualified Deferred Compensation Plan Table—Fiscal 2018” below.
(4) | Amounts shown in Column (i) for fiscal 2018 consist of, for (i) Mr. Paul Marciano, home security ($148,556), automobile expenses, including fuel, maintenance and insurance ($50,180), health insurance related expenses ($31,444), life insurance ($10,580), incremental cost for personal use of Company leased or chartered aircraft ($6,813) and matching contributions to the Company’s 401(k) Plan ($4,750), (ii) Victor Herrero, automobile expenses, including fuel, maintenance and insurance ($20,291), health insurance related expenses ($10,088), life insurance ($9,855) and matching contributions to the Company’s 401(k) Plan (or to Mr. Herrero’s DCP to “make up” for 401(k) match amounts that could not be made to the Company’s 401(k) Plan) ($3,313), and (iii) Sandeep Reddy, health insurance related expenses ($20,158), matching contributions to the Company’s 401(k) Plan ($7,889) and tax equalization amounts related to his prior assignment in Switzerland ($2,300)Company (unless otherwise disclosed). Mr. Paul Marciano’s incremental cost for personal use of Company leased or chartered aircraft referenced above was incurred as a result of a short personal leg on an extended trip that was otherwise for Company
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| (6) | 49Mr. Maurice Marciano did not receive any compensation in connection with his service as our Interim Chief Executive Officer from February 2, 2019 to February 19, 2019. The compensation paid to Mr. Maurice Marciano in connection with his service as the Chairman of our Board is reported in the“Non-Employee Director Compensation—Fiscal 2020” table above.
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| (7) |
| business. The incremental cost of the personal leg of the trip was calculated by allocating the variable costs of the trip based on flight hours, and excluding the fixed costs of the use of the aircraft as the aircraft was otherwise being used on the trip for Company business. In addition, when our Named Executive Officers travel on an aircraft leased or chartered by the Company for business purposes, on occasion a personal guest of the executive may accompany the executive by occupying a seat on the aircraft that would otherwise be unoccupied. In these situations, any incremental cost to the Company for the personal air travel is paid for or reimbursed by the executive. Pursuant to the terms of their employment agreements, Mr. Paul Marciano and Mr. Victor Herrero are each entitled to the use of a Company-provided automobile. Incremental cost to the Company for the use of Company-owned automobiles was calculated based on an Internal Revenue Service formula for valuing the use of Company-owned automobiles. Incremental cost to the Company for each other item included in Column (i) was calculated using the actual cost to the Company.Mr. Reddy’s employment with the Company terminated December 1, 2019. Mr. Reddy’s separation agreement with the Company is discussed below under “Potential Payments upon Termination or Change in Control.” |
(5) | The amount reported in Column (d) above for fiscal 2016 for Mr. Herrero represents a sign-on cash award paid in connection with his commencing employment with the Company. The grant date fair value of stock and option awards reported in Columns (e) and (f) above for fiscal 2016 for Mr. Herrero include special one-time awards granted to Mr. Herrero in connection with him joining the Company to help compensate him for incentives with his former employer that he forfeited on joining the Company and as an additional incentive to accept his offer of employment. |
Compensation of Named Executive Officers The “Summary Compensation Table” above quantifies the value of the different forms of compensation earned by or awarded to our Named Executive Officers in fiscal 2018,2020, fiscal 2017,2019 and fiscal 2016.2018. The primary elements of each Named Executive Officer’s total compensation reported in the table are base salary, long-term equity incentives consisting of stock options, restricted stock and/or restricted stock units and cash incentive compensation. Named Executive Officers also earned or were paid the other benefits listed in Column (i) of the “Summary Compensation Table,” as further described in footnote (4)(5) to the table. The “Summary Compensation Table” should be read in conjunction with the tables and narrative descriptions that follow. A description of the material terms of each Named Executive Officer’s employment agreement or employment offer letter is provided immediately following this paragraph. The “Grants of Plan-Based Awards in Fiscal 2018”2020” table, and the description of the material terms of the stock options, restricted stock and restricted stock units that follows it, provides information regarding the long-term equity incentives awarded to Named Executive Officers in fiscal 2018.2020. The “Outstanding Equity Awards at Fiscal 2018 2020Year-End” and “Option Exercises and Stock Vested in Fiscal 2018”2020” tables provide further information on the Named Executive Officers’ potential realizable value and actual realized value with respect to their equity awards. The “Pension Benefits Table—Fiscal 2018”2020” and related description of the material terms of our SERP describe each Named Executive Officer’sthe retirement benefits provided to Messrs. Paul Marciano and Alberini under our SERP. The discussion under “—Potential“Potential Payments Upon Termination or Change in Control” below is intended to further explain the potential future payments that are, or may become, payable to our Named Executive Officers under certain circumstances. 49
Description of Employment Agreements The following is a description of the material terms of the employment agreements and employment offer letters with our Named Executive Officers.Officers that were in effect during fiscal 2020. Each of these agreements also provides or provided for severance payments and benefits upon certain terminations of the Named Executive Officer’s employment. See “—Potential“Potential Payments upon Termination or Change in Control” below for a description of the material terms of these benefits. Paul Marciano On January 26, 2016, theThe Company and Mr. Paul Marciano entered into a newis not currently party to an employment agreement in connection with his transition to the roles of Executive Chairman and Chief Creative Officer, which was amended on April 28, 2017 to reflect the adjustments to Mr. Paul Marciano’s base salary and annual incentive opportunities as discussed in the “Compensation Discussion and Analysis” section above (the “Paul Marciano Employment Agreement”). The terms of the Paul Marciano Employment Agreement were effective as of January 31, 2016 and superseded prior employment agreements between the Company and Mr. Paul Marciano. Subject to certain termination provisions, the Paul Marciano Employment Agreement provides for Mr. Paul Marciano’s continued employment by the Company as its Executive Chairman and Chief Creative Officer through January 30, 2019.
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The Paul Marciano Employment Agreement provides for the following compensation and benefits:
base salary at the annual rate of $950,000 effective in fiscal 2018;
an annual cash incentive opportunity based on a bonus range, and on the achievement of performance criteria, to be established by the Compensation Committee, provided that the target annual cash incentive will equal at least 263% of Mr. Paul Marciano’s base salary effective for fiscal 2018, with the potential payments based on performance ranging from zero to 150% of the target amount effective for fiscal 2018;
continued participation in the Company’s long-term incentive plans in accordance with the Company’s compensation practices;
continued participation in the Company’s SERP (with the amount of “compensation,” as defined in the SERP, for Mr. Paul Marciano for any year following 2013 that will be taken into account for purposes of calculating his benefits under the plan to be capped at $6,250,000 and, if Mr. Paul Marciano retires or otherwise has a termination of employment for any reason other than a termination by the Company for cause after January 31, 2016, his “average compensation” for purposes of his SERP benefit will be determined as of January 31, 2016 as though he had retired on that date), automobile use and home security benefits, in each case consistent with existing practices, and reimbursement for certain costs and expenses incurred by the executive to evaluate and negotiate the Paul Marciano Employment Agreement;
participation in the Company’s other benefit plans and policies on terms consistent with those generally applicable to the Company’s other senior executives (including, without limitation, vacation benefits and other perquisites); and
the Company will continue to purchase, and pay the premiums for, life insurance coverage for Mr. Paul Marciano, with Mr. Paul Marciano (or a trust established by him) as the owner of the policy andhis previous employment agreement expired according to its terms on January 30, 2019. Mr. Paul Marciano’s continuing employment with the right to designate the beneficiary.
Company is on an“at-will” basis.Victor HerreroCarlos Alberini
On July 7, 2015,January 27, 2019, the Company entered into an employment agreement with Mr. Herrero, which was amended on April 28, 2017 to reflect the adjustment to Mr. Herrero’s annual equity award grant level as discussed in the “Compensation Discussion and Analysis” section aboveCarlos Alberini (the “Herrero“Alberini Employment Agreement”). The terms of the Herrero Employment Agreement were effective as of July 7, 2015. Subject to certain termination provisions, the HerreroAlberini Employment Agreement provides for Mr. Herrero’sAlberini’s employment by the Company as its Chief Executive Officer for a four-yearthree-year term, with automaticone-year renewals thereafter unless either party provides notice that the term will not be extended. The HerreroAlberini Employment Agreement provides for Mr. HerreroAlberini to receive the following compensation and benefits: base salary at the annual rate of $1,200,000 (subject to annual review and increase (but not decrease) by the Compensation Committee), and with amounts in excess; signing bonus of $1,000,000 and an award of 150,000 fully-vested restricted stock units, which are both subject to be deferred pursuantrepayment by Mr. Alberini if he terminates his employment other than for “good reason” (as such term is defined in the Alberini Employment Agreement) prior to the Company’s DCP;first anniversary of his employment commencement date; an annual cash incentive opportunity based on the achievement of performance criteria to be established by the Compensation Committee, with his annual threshold, target and maximum cash incentive opportunities to be 100%, 200% and 300%, respectively, of his base salary for the corresponding year; anon-qualified stock option award to purchase 600,000 shares, which will vest over 4 years, subject to Mr. Alberini’s continued employment through each applicable vesting date, and an award of 250,000 restricted stock units that will vest over 4 years, subject to the Company achieving the applicable performance-vesting condition and Mr. Alberini’s continued employment through each applicable vesting date; an additional equity award each year during the term of the agreement, commencing with fiscal 20172021 and subject to Mr. Herrero’sAlberini’s continued employment, to be made when the Company sets performance goals for that year for purposes of the Company’s executive compensation programs generally, with the target grant date fair value of such award to be not less than 233% of Mr. Herrero’s base salary level in effect at the time of grant effective with fiscal 2018$3,800,000 (with the values based on the grant date fair value of the awards as determined by the Company for its financial reporting purposes); and
participation in the Company’s other benefit plans and policies on terms commensurate with his position (including, without limitation, vacation benefits, an automobile provided by the Company and other perquisites), and reimbursement of life insurance premiums up to $10,000 per year. 50
Maurice Marciano The Company was not party to any employment agreement or offer letter with Maurice Marciano. Kathryn Anderson On October 23, 2019, the Company entered into an employment offer letter with Kathryn Anderson (the “Anderson Letter”). The Anderson Letter provides for Ms. Anderson to receive the following compensation and benefits: base salary at the annual rate of $550,000; signing bonus of $300,000, which is subject to repayment by Ms. Anderson if she terminates her employment other than for “good reason” (as such term is defined in the Anderson Letter) prior to the first anniversary of her employment commencement date; an annual cash incentive opportunity based on the achievement of performance criteria to be established by the Compensation Committee, with her target annual cash opportunity to be 75% of her base salary for the corresponding year. For fiscal 2020, Ms. Anderson was guaranteed a minimum annual cash incentive of $100,000 (with the opportunity to earn up to an additional $100,000 based on performance or other criteria established by the Company); an annual long-term equity incentive opportunity, commencing with fiscal 2021, as determined by the Compensation Committee, with her target annual long-term equity incentive opportunity to be 150% of her base salary (based on the grant date fair value of the awards, and with not less than 40% of such award grant date value to be in the form of restricted stock, restricted stock units, performance stock units, or a combination thereof); anon-qualified stock option award to purchase 130,000 shares and an award of 70,000 shares of restricted stock, which will vest over 4 years and will accelerate upon a “change in control” of the Company (as such term is defined in the Anderson Letter), subject to Ms. Anderson’s continued employment through each applicable vesting date; and participation in the Company’s other benefit plans and policies on terms commensurate with her position (including, without limitation, vacation benefits and other perquisites). Sandeep Reddy Sandeep Reddy and the Company executed an amended and restated employment offer letter dated April 28, 2017 (the “Reddy Letter”), which superseded his previous employment offer letter dated July 18, 2013. The Reddy Letter provided that Mr. Reddy’s base salary would remain at the then-existing level of $525,000 per year, and that Mr. Reddy would receive an annual cash incentive opportunity and an annual target equity award opportunity, each determined in accordance with the Company’s executive incentive program. Mr. Reddy’s then-existing target annual cash incentive opportunity of 75% of his base salary was retained. In March 2018, the Compensation Committee increased Mr. Reddy’s annual base salary for fiscal 2019 from $525,000 to $650,000 and his target annual cash incentive amount for fiscal 2019 from 75% to 90% of his base salary. The Compensation Committee continued these levels for fiscal 2020. His base salary and target annual cash incentive amount had previously remained at the same levels since fiscal 2016. Mr. Reddy iswas also eligible to participate in the Company’s 401(k) plan and DCP and iswas entitled to receive other benefits normally provided to senior executives, including participation in health, disability and life insurance programs maintained by the Company. Mr. Reddy’s employment with the Company terminated December 1, 2019. Mr. Reddy’s separation agreement with the Company is discussed below under “Potential Payments upon Termination or Change in Control.” 51
Grants of Plan-Based Awards in Fiscal 20182020 The following table presents information regarding the equity andnon-equity incentive awards granted to the Named Executive Officers during fiscal 20182020 under the Company’s 2004 Equity Incentive Plan and Bonus Plan. The material terms of each grant are described below under “—Description“Description of Plan-Based Awards.” | | | | | | Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards | | Estimated Future Payouts
Under Equity Incentive Plan
Awards | | All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#) | | | All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#) | | | Exercise
or Base
Price of
Option
Awards
($/Sh) | | | Grant
Date
Fair
Value
of Stock
and
Option
Awards
($)(1) | | | | | Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards | | Estimated Future Payouts
Under Equity Incentive Plan
Awards | | All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#) | | All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#) | | Exercise
or Base
Price of
Option
Awards
($/Sh) | | Grant
Date
Fair
Value
of Stock
and
Option
Awards
($)(1) | Name | | Grant
Date | | Threshold
($) | | Target
($) | | Maximum
($) | | Threshold
(#) | | Target
(#) | | Maximum
(#) | | | Grant
Date | | Threshold
($) | | Target
($) | | Maximum
($) | | Threshold
(#) | | Target
(#) | | Maximum
(#) | | (a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | | (k) | | (l) | | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | | (k) | | (l) | Paul Marciano | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | | — | | | 110,664 | | | | — | | | | — | | | | — | | | | — | | | 1,235,010 | | | 6/20/2019 | (2) | | | — | | | | — | | | | — | | | | — | | | 205,339 | | | | — | | | | — | | | | — | | | | — | | | 3,000,003 | | | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | 44,803 | | | 89,606 | | | 179,212 | | | | — | | | | — | | | | — | | | 1,000,003 | | | 6/20/2019 | (3) | | 950,000 | | | 1,900,000 | | | 2,850,000 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | 29,061 | | | 116,245 | | | 174,368 | | | | — | | | | — | | | | — | | | 1,235,010 | | | | | 4/28/2017 | (3) | | 1,249,250 | | | 2,498,500 | | | 3,747,750 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | Victor Herrero | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | | — | | | 125,449 | | | | — | | | | — | | | | — | | | | — | | | 1,400,011 | | | Carlos Alberini | | | 2/20/2019 | (4) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 150,000 | | | | — | | | | — | | | 3,207,000 | | | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | 44,803 | | | 89,606 | | | 179,212 | | | | — | | | | — | | | | — | | | 1,000,003 | | | 2/20/2019 | (4) | | | — | | | | — | | | | — | | | | — | | | 250,000 | | | | — | | | | — | | | | — | | | | — | | | 5,345,000 | | | | 4/28/2017 | (2) | | | — | | | | — | | | | — | | | 32,944 | | | 131,775 | | | 197,663 | | | | — | | | | — | | | | — | | | 1,400,004 | | | 2/20/2019 | (4) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 600,000 | | | 21.38 | | | 4,035,540 | | | | 4/28/2017 | (3) | | 1,200,000 | | | 2,400,000 | | | 3,600,000 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 6/20/2019 | (3) | | 1,200,000 | | | 2,400,000 | | | 3,600,000 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | Maurice Marciano(5) | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | Kathryn Anderson | | | 12/2/2019 | (6) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 70,000 | | | | — | | | | — | | | 1,339,800 | | | | | 12/2/2019 | (6) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 130,000 | | | 19.15 | | | 865,852 | | | Sandeep Reddy | | 3/29/2017 | (4) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 14,075 | | | 32,875 | | | 11.22 | | | 209,309 | | | 6/10/2019 | (7) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 128,700 | | | 14.32 | | | 601,145 | | | | 4/28/2017 | (5) | | | — | | | | — | | | | — | | | 25,874 | | | 51,747 | | | 103,494 | | | | — | | | | — | | | | — | | | 577,497 | | | 6/20/2019 | (3) | | 292,500 | | | 585,000 | | | 1,170,000 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 4/28/2017 | (3) | | 196,875 | | | 393,750 | | | 787,500 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | |
| (1) | The grant date fair value for each equity award reported in Column (l) of the table above was determined in accordance with applicable accounting rules, with the grant date fair value of performance-based awards determined based on the probable outcome of the performance-based conditions applicable to the awards.awards that we determined to be probable for these purposes at the time of grant of the awards (which, in each case, was the target level of performance). See note (1)(2) to the “Summary Compensation Table” above. |
| (2) | These entries reflect awardsThis entry reflects an award of restricted stock units granted to Mr. Paul Marciano and Mr. Herrero during fiscal 20182020 that werewas subject to time- and performance-based vesting requirements. For a description of these awards,this award, see “—Executive“Executive Compensation Program Elements for Fiscal 2018—2020—Long-Term Equity Incentive Awards—Equity AwardsAward for Mr. Paul Marciano and Mr. Herrero for Fiscal 2018”2020” above and the narrative that follows this table. |
| (3) | Amounts reported in these rows reflect the threshold, target and maximum cash incentive award opportunities for the Named Executive Officers (other than Mr. Maurice Marciano and Ms. Anderson) for fiscal 2018. Under the 2018 annual cash incentive plan, the maximum payout available to each of these Named Executive Officer was determined based on a specific formula tied to the Company’s cash flow from operations for fiscal 2018 or, if less, a specified multiple of the Named Executive Officer’s annual base salary. The specified multiple of base salary is reported as the applicable maximum amount in the table |
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| above.2020. The final annual cash incentive amount for each of these Named Executive Officers was determined (within the applicable maximum) based on the Company’s earnings from operations (and licensing segment earnings from operations in the case of 50% of Mr. Paul Marciano’s award) for fiscal 20182020 and is reported in Column (g) of the “Summary Compensation Table.” Mr. Reddy forfeited his cash incentive award opportunity in connection with his separation of employment in December 2019. The net (after withholdings and deductions, except that Mr. Paul Marciano satisfied his tax withholding obligations for this award with a cash payment to the Company, as permitted by the Compensation Committee) amount of the annual incentive awards was settled in fully-vested shares of the Company’s common stock in April 2020. For more details, see “—Executive“Executive Compensation Program Elements for Fiscal 2018—2020—Annual Cash Incentive Awards” above. |
| (4) | The awards reported in these columnsrows granted to Mr. Alberini during fiscal 2020 consist of (1) fully vested restricted stock units, (2) restricted stock units that were subject to time- and performance-based vesting requirements, and (3) stock options that were subject to time-based vesting requirements. For a description of these awards, see “Executive Compensation Program Elements for Fiscal 2020—Long-Term Equity Incentive Awards—Equity Awards for Mr. Reddy were granted based onAlberini for Fiscal 2020” above and the Compensation Committee’s historical practice, which has been to grant annual equity awards based on performance for the preceding fiscal year. In the first quarter of fiscal 2018, the Compensation Committee reviewed the Company’s performance with respect to pre-established performance goals for fiscal 2017, certified the results and calculated the maximum eligible award levels for Mr. Reddy. The Compensation Committee then determined the actual award amounts based on a discretionary quantitative and qualitative assessment of individual and Company performance. The resulting awards, granted on March 29, 2017, are reported in Columns (i) and (j) above. Since each of these equity awards related to performance in fiscal 2017, the basis for these awards was included in the “Compensation Discussion and Analysis” section of our proxy statement filed with the SEC on May 26, 2017 with respect to our 2017 annual meeting of shareholders.narrative that follows this table. |
For fiscal 2018, the Compensation Committee established maximum individual equity award opportunities in the form of stock options and restricted stock for Mr. Reddy pursuant to a specific formula tied to the Company’s cash flow from operations for fiscal 2018. After the fiscal year was complete, the Compensation Committee determined the Company’s cash flow from operations for the fiscal year, which resulted in a maximum payout opportunity for Mr. Reddy as described in “—Executive Compensation Program Elements for Fiscal 2018—Long-Term Equity Incentive Awards—Equity Awards for Mr. Reddy for Fiscal 2018” above. The Compensation Committee then determined the actual equity award amounts at a level at or below the maximum potential equity awards based on a discretionary quantitative and qualitative assessment of individual and Company performance.
The total number of stock options and restricted shares, and corresponding value on the date of grant, approved by the Compensation Committee and granted on March 30, 2018 with respect to fiscal 2018 performance for Mr. Reddy was 20,628 restricted shares and options to purchase 26,671 shares, with an aggregate grant-date value of $584,941. See also, “—Executive Compensation Program Elements for Fiscal 2018—Long-Term Equity Incentive Awards—Equity Awards for Mr. Reddy for Fiscal 2018” above.
| (5) | Mr. Maurice Marciano did not receive any compensation in connection with his service as our Interim Chief Executive Officer from February 2, 2019 to February 19, 2019. The compensation paid to Mr. Maurice Marciano in connection with his service as the Chairman of our Board is reported in the“Non-Employee Director Compensation—Fiscal 2020” table above. |
| (6) | The awards reported in these rows granted to Ms. Anderson during fiscal 2020 consist of (1) shares of restricted stock that were subject to time-based vesting requirements for which Ms. Anderson paid a purchase price of $700 and (2) stock options that were subject to time-based vesting requirements. For a description of these awards, see “Executive Compensation Program Elements for Fiscal 2020—Long-Term Equity Incentive Awards—Equity Awards for Ms. Anderson for Fiscal 2020” above and the narrative that follows this table. |
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| (7) | This entry reflects an award of restricted stock unitsoptions granted to Mr. Reddy during fiscal 20182020 that was subject to time- and performance-basedtime-based vesting requirements. For a description of this award, see “—Executive“Executive Compensation Program Elements for Fiscal 2018—2020—Long-Term Equity Incentive Awards—Equity Awards for Mr. Reddy for Fiscal 2018”2020” above and the narrative that follows this table. |
Description of Plan-Based Awards The Grants of Plan-Based Awards Table above reflects a cash incentive award opportunity (under a performance-based program based on fiscal 20182020 results) for each of the Named Executive Officers as well as equity awards granted to(other than Mr. Reddy during fiscal 2018 of time-based stock optionMaurice Marciano and restricted stock awards (under a performance-based program based on fiscal 2017 results)Ms. Anderson). The table also reflects three equity awards granted during fiscal 20182020 to Mr. Paul Marciano and Mr. Herrero with performance-based vesting terms and one equity award granted during fiscal 2018 to Mr. Reddy with performance-based vesting terms,the Named Executive Officers, in each case as described in more detail below. Each of these awards was granted under, and is subject to the terms of, the 2004 Equity Incentive Plan or the Bonus Plan. The plans are administered by the Compensation Committee. Vesting requirements for these awards discussed in this Proxy Statement generally assume no change in control of the Company occurs and that the executive would not be entitled to any accelerated vesting in connection with a termination of employment. Change in control and accelerated vesting provisions applicable to these awards are discussed below and in the “—Potential“Potential Payments upon Termination or Change in Control” section below. Stock Options The stock optionoptions reported in Column (j) of the table above waswere granted with aper-share exercise price equal to the closing price of a share of the Company’s Common Stock on the NYSE on the grant date and isare scheduled to vest in four annual installments. The stock option awardawards listed in the table above hashave a term of ten years. Outstanding options, however, may terminate earlier in connection with a termination of the Named Executive Officer’s employment. Subject to any accelerated vesting that may apply in the circumstances (or other modification as approved by the Compensation Committee), the unvested portion of the stock option will immediately terminate upon a termination of the Named Executive Officer’s employment. The stock option granted to Ms. Anderson will fully vest upon a “change in control” of the Company (as such term is defined in the Anderson Letter). If Mr. Alberini’s employment is terminated due to his death or disability (as defined in the Alberini Employment Agreement), he will vest in apro-rata portion of his stock option that was scheduled to vest on the next vesting date. If Mr. Alberini’s employment is terminated by the Company without “cause”, by Mr. Alberini for “good reason” (as such terms are defined in the Alberini Employment Agreement), or due to anon-renewal of the term of the employment agreement by the Company, in each case subject to Mr. Alberini executing a release of claims in favor of the Company, Mr. Alberini’s stock options will fully vest. If a change in control of the Company occurs and the award was terminated in connection with the transaction (that is, it is not continued following such event or assumed or converted by the successor entity), the stock options would become fully vested as of the date of the change in control. The Named Executive Officer will generally have 60 days to exercise the vested portion of the stock option following a termination of employment. This period is extended to 12 months if the termination is on account of the Named Executive Officer’s death, permanent disability or retirement. The stock option award is evidenced by an award agreement 53
that sets forth the specific terms and conditions of the award, not inconsistent with the terms of the 2004 Equity Incentive Plan. Restricted Stock The restricted stock award for Ms. Anderson reported in Column (i) of the table above is scheduled to vest in four annual installments. Generally, Named Executive Officers are entitled to voting and dividend rights with respect to restricted stock awards. Any stock dividends issued with respect to restricted sharesstock awards are generally subject to the same vesting and other terms and conditions as the original restricted sharesstock awards to which they relate. Subject to any accelerated vesting that may apply in the circumstances (or other modification as approved by the Compensation Committee), the unvested portion of any restricted stock award will generally be forfeited upon a termination of the Named Executive Officer’s employment. EachThe shares of restricted stock granted to Ms. Anderson will fully vest upon a “change in control” of the Company (as such term is defined in the Anderson Letter). The restricted stock award is evidenced by an award agreement that sets forth the specific terms and conditions of the award, not inconsistent with the terms of the 2004 Equity Incentive Plan. Performance-Based
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Restricted Stock Units The award of 150,000 restricted stock units for Mr. Paul Marciano 2018 Licensing Award and Mr. Herrero 2018 Revenue Award.Alberini reported in Column (g)(i) of the table above includeswas fully vested at the awardtime of 110,664 restricted stock unitsgrant. Mr. Alberini will be required to return the shares subject to the 2018 Licensing Award granted to Mr. Paul Marcianoaward (or the proceeds of the sale of any such shares that have been sold) if he terminates his employment other than for “Good Reason” (as such term is defined in April 2017 and 125,449 restricted stock units subject tohis employment agreement) within one year of the 2018 Revenue Award granted to Mr. Herrero in April 2017.date of grant. Each restricted stock unit subject to the 2018 Licensing Awardaward represented a contractual right to receive one share of the Company’s Common Stock. Performance-Based Restricted Stock Units Mr. Paul Marciano 2020 Award.The restricted stock unit award for Mr. Paul Marciano reported in Column (g) of the table above was eligible to vest if the Company achieved the specific performance goals and based on Mr. Paul Marciano’s continued service through the 2018 Revenue Awardapplicable vesting date. Each restricted stock unit subject to the award represents a contractual right to receive one share of the Company’s Common Stock if the applicable performance-based and time-based vesting requirements are satisfied. For Mr. Paul Marciano,50% of the restricted stock units wereaward was eligible to vest based on the Company’s earnings from operations from its licensing earningssegment for fiscal 2018. For Mr. Herrero,2020 and the restricted stock units wereremaining 50% of the award was eligible to vest based on the Company’s total revenue (excluding net royalties)earnings from operations for fiscal 2018.2020. If both of the applicable performance goalgoals established by the Compensation Committee for the performance period waswere met, all of the restricted stock units subject to the award would be eligible to vest. If only one of the applicable performance goalgoals established by the Compensation Committee for the performance period had not beenwas met, then 50% of the restricted stock units subject to the award would be eligible to vest. If neither of the performance goals established by the Compensation Committee for the performance period were met, all of the restricted stock units subject to the award would have been cancelled and terminated as of the last day of the performance period. In each case, however, if either a change in control (as defined in the executive’s employment agreement) or the executive’s death or disability (as defined in the executive’s employment agreement) occurred before the last day of the performance period, the applicable performance requirement would have been deemed to have been satisfied as of the date of such event. If a change in control occurred and the awards were terminated in connection with the transaction (that is, it is not continued following such event or assumed or converted by the successor entity), the restricted stock units subject to the award would have become fully vested as of the date of the change in control. As described in, “—Executive“Executive Compensation Program Elements for Fiscal 2018—2020—Long-Term Equity Incentive Awards—Equity AwardsAward for Mr. Paul Marciano and Mr. Herrero for Fiscal 2018”2020” above, the Compensation Committee determined that theboth performance goals were met for both the 2018 Licensing Award and the 2018 Revenue Award for the performance period. The restricted stock units subject to each of the 2018 Licensing Award and the 2018 Revenue AwardMr. Paul Marciano’s award that became eligible to vest based on performance during the performance period will generally vest in three equal installments, withone-third of the stock units vesting on January 30 of 2018, 20192020, 2021 and 2020.2022. In general and except as noted below, if the executive’s service to the Company terminates for any reason, any restricted stock units subject to the award that have not previously vested will terminate. If the executive’s employment terminates due to a termination by the Company without cause (as defined in the Paul Marciano Employment Agreement or the Herrero Employment Agreement, as applicable), by the executive for good reason (as defined in the Paul Marciano Employment Agreement or the Herrero Employment Agreement, as applicable), or due to the executive’s death or disability, anyall restricted stock units subject to the award that became eligible to vest based on performance will become fully vested as of the termination date.date (and if such termination occurs prior to the end of the performance period, the performance requirements will be deemed to have been met). If there is a change in control of the Company afterprior to the end of the performance period, the performance conditions would be deemed to have been satisfied as of the date of such event and the time-based vesting conditions will continue to apply (except as provided in the next sentence). If there is a change in control of the Company and the then-outstanding and unvested portion of the awards are 54
award is terminated in connection with the transaction (that is, it is not continued following such event or assumed or converted by the successor entity), such portion of the restricted stock units subject to the awardsaward will become fully vested as of the date of the change in control. Mr. Paul Marciano and Alberini Fiscal 2020 Award.The award of 250,000 restricted stock units for Mr. Herrero 2018 Relative TSR Awards.Columns (f) through (h)Alberini reported in Column (g) of the table above includewas eligible to vest if the awardsCompany achieved a specified level of restricted stock units subject tototal revenue for fiscal 2020, and based on Mr. Alberini’s continued employment through the 2018 Relative TSR Award granted to Mr. Paul Marciano and Mr. Herrero in April 2017.applicable vesting date. Each restricted stock unit subject to the 2018 Relative TSR Awardsaward represents a contractual right to receive one share of the Company’s Common Stock if the applicable performance-based and time-based vesting requirements are satisfied. The restricted stock units subject toIf the awards cover a target number of shares of the Company’s Common Stock equal to 116,245 shares (in the case of the award granted to Mr. Paul Marciano) and 131,775 shares (in the case of the award granted to Mr. Herrero), with the number of units subject to the awards that are ultimately eligible to vest being equal to zero to 150% of the target number based upon the Company’s TSR for a three-year performance period consisting of fiscal 2018 through fiscal 2020 relative to the TSRs during that performance period of a peer group of companies selectedgoal established by the Compensation Committee. If the Company’s TSR ranks at the 50th percentile relative to the peer groupCommittee for the performance period the target numberwas met, all of the restricted stock units subject to the awards willaward would be eligible to vest. If the Company’s TSR ranks atperformance goal established by the 25th percentile relative to the peer groupCompensation Committee for the performance period 25% of the target numberwas not met, all of the restricted stock units subject to the awards will be eligible to vest. If the Company’s TSR ranks at the 75th percentile or above relative to the peer group for the performance period, 150% of the target number of the restricted stock units subject to the awards will be eligible to vest. However, in no event will the awards vest as to shares of the Company’s Common Stock with a value greater than $3,705,000 (in the case of Mr. Paul Marciano) and $4,200,000 (in the case of Mr. Herrero) determined as of the vesting date. If the Company’s TSR is between these threshold, target and maximum performance levels, the vesting percentage will be determined by linear interpolation between the vesting percentages for those levels. No portion of the awards will vest if the Company’s relative TSR for the performance period is below the 25th percentile. Any restricted stock units subject to the awards that are not deemed eligible to vest based on the Company’s relative TSR will beaward would have been cancelled and terminated as of the last day of the performance period. As described in, In
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“Executive Compensation Program Elements for Fiscal 2020—Long-Term Equity Incentive Awards—Equity Awards for Mr. Alberini for Fiscal 2020” above, the eventCompensation Committee determined that during the performance period and prior to a change in control, Mr. Paul Marciano or Mr. Herrero’s employment terminates due to a termination by the Company without cause (including a non-renewal of the employment agreement in the case of Mr. Herrero, as defined in the executive’s employment agreement) or by the executivegoal was met for good reason (as defined in the executive’s employment agreement), the target number of units will be prorated by multiplying the target number by a fraction, the numerator of which is the number of days the executive was employed during the performance period, and the denominator of which is total number of days in the performance period, and the prorated number of targetperiod. The restricted stock units would remain outstanding andsubject to Mr. Alberini’s award that became eligible to vest based on performance during the Company’s relative TSRperformance period will generally vest in four equal installments, withone-fourth of the stock units vesting on February 20 of 2020, 2021, 2022 and 2023. In general and except as noted below, if the executive’s service to the Company terminates for any reason, any restricted stock units subject to the entire three-year performance period.award that have not previously vested will terminate. If the executive’s employment terminates due to the executive’s death or disability (as defined in the executive’s employment agreement)Alberini Employment Agreement), the executive will vest in apro-rata portion of the restricted stock units subject to the award that were scheduled to vest on the next vesting date (and if such termination occurs duringprior to the end of the performance period, the performance requirements will be deemed to have been met). If Mr. Alberini’s employment is terminated by the Company without “cause”, by Mr. Alberini for “good reason” (as such terms are defined in the Alberini Employment Agreement), or due to anon-renewal of the term of the employment agreement by the Company, in each case subject to Mr. Alberini executing a release of claims in favor of the Company, Mr. Alberini’s outstanding and unvested restricted stock units will fully vest (and if such termination occurs prior to the end of the performance period, the award shall remain outstanding until the end of the performance period, and if the performance condition is satisfied, at the target level.restricted stock units shall vest following the certification by the Compensation Committee of the satisfaction of the performance goal, and if the performance condition is not met, the restricted stock units shall be forfeited). If there is a change in control (as defined inof the executive’s employment agreement) occurs duringCompany prior to the end of the performance period, the awardsperformance condition will be eligibledeemed to vesthave been satisfied as of the date of such event and the time-based vesting conditions will continue to eitherapply (except as provided in the target number of units (if thenext sentence). If there is a change in control occurs during the first year of the performance period) or based onCompany and the Company’s relative TSR for the performance period through the change in control (if the change in control occurs during the second or third yearthen-outstanding and unvested portion of the performance period). Ifaward is terminated in connection with the award continuestransaction (that is, it is not continued following such event or is assumed or converted by the successor entity, the number of units that are eligible to vest will vest on the last dayentity), such portion of the original performance period subject to the executive’s continued employment through the vesting date and to accelerated vesting if the executive’s employment terminates due to a termination by the Company without cause, by the executive for good reason, or as a result of his death or disability. Such units will vest upon the change in control if the award is to be terminated in connection with the change in control transaction (that is, the award does not continue following such event and is not assumed or converted by the successor entity). 2018 LTIP Awards. Columns (f) through (h) of the table above include the awards of restricted stock units subject to the 2018 LTIP Award granted to Mr. Paul Marciano, Mr. Herrero and Mr. Reddy in April 2017. Each
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restricted stock unit subject to the 2018 LTIP Awards represents a contractual right to receive one share of the Company’s Common Stock if the applicable performance-based and time-based vesting requirements are satisfied. The restricted stock units subject to the awards cover a target number of shares of the Company’s Common Stock equal to 89,606 shares (in the case of the awards granted to Mr. Paul Marciano and Mr. Herrero) and 51,747 shares (in the case of the award granted to Mr. Reddy), with the number of units subject to the awards that are ultimately eligible to vest being equal to zero to 200% of the target number based 25% upon the Company’s revenue (excluding the Americas Retail segment) and 75% upon the Company’s earnings from operations for fiscal 2020 as determined in accordance with GAAP and as reflected in the Company’s financial reports. See “—Executive Compensation Program Elements for Fiscal 2018—Long-Term Equity Incentive Awards—Equity Awards for Mr. Paul Marciano and Mr. Herrero for Fiscal 2018—LTIP Awards” for a description of the number of shares that vest based on the Company’s revenue and earnings from operations for fiscal 2020. No portion of the awards will vest if the Company’s revenue and earnings from operations is below the threshold level. Any restricted stock units subject to the awards that are not deemed eligible to vest based on the Company’s revenue and earnings from operations will be cancelled and terminatedbecome fully vested as of the last daydate of the performance period.
In the event that, during the performance period and prior to a change in control, Mr. Paul Marciano or Mr. Herrero’s employment terminates due to a termination by the Company without cause (as defined in the executive’s employment agreement and including a non-renewal of the employment agreement in the case of Mr. Herrero) or by such executive for good reason (as defined in the executive’s employment agreement), the target number of units will be prorated by multiplying the target number by a fraction, the numerator of which is the number of days the executive was employed during the performance period, and the denominator of which is total number of days in the performance period, and the prorated number of target units would remain outstanding and eligible to vest based on the Company’s revenue and earnings from operations for fiscal 2020. If Mr. Paul Marciano, Mr. Herrero or Mr. Reddy’s death or disability (as defined in the executive’s employment agreement or the award agreement) occurs during the performance period, performance will be deemed satisfied at the target level. If a change in control (as defined in the executive’s employment agreement or the award agreement) occurs during the performance period, the awards will be eligible to vest as to the target number of units. If the award continues following such event or is assumed or converted by the successor entity, the target number of units will remain eligible to vest on the last day of the original performance period subject to the executive’s continued employment through the vesting date and to accelerated vesting if the executive’s employment terminates due to a termination by the Company without cause (except in the case of Mr. Reddy), by the executive for good reason (except in the case of Mr. Reddy), or as a result of his death or disability. The target number of units will vest upon the change in control if the award is to be terminated in connection with the change in control transaction (that is, the award does not continue following such event and is not assumed or converted by the successor entity).control.
The restricted stock units awarded to Mr.Messrs. Paul Marciano and Mr. HerreroAlberini include dividend equivalent rights. If a cash dividend is paid with respect to the Company’s Common Stock while any restricted stock units subject to the award are outstanding, the award will be credited with an amount in cash equal to the dividends the award holder would have received if he had been the owner of the shares of Company Common Stock subject to the outstanding restricted stock units. Any dividend equivalents credited with respect to an award are subject to the same vesting requirements as the restricted stock units to which they relate. Non-Equity Incentive Plan Awards With respect to fiscal 20182020 performance, the Company grantednon-equity incentive plan award opportunities to its eligible Named Executive Officers as described in note (3) to the table above. In the first quarter of fiscal 2019,April 2020, the Compensation Committee reviewed the Company’s performance with respect to thepre-established performance goals, certified the level of performance and the resulting awards to the Named Executive Officers for fiscal 20182020 as described above under “—Executive“Executive Compensation Program Elements for Fiscal 2018—2020—Annual Cash Incentive Awards” and as set forth in Column (g) of the “Summary Compensation Table.” 5655
Outstanding Equity Awards at Fiscal 2018 2020Year-End The following table presents information regarding the outstanding equity awards held by each Named Executive Officer as of February 3, 2018,1, 2020, including the vesting dates for the awards that had not fully vested as of that date. | | | | | | Option Awards(1) | | Stock Awards(2) | | | | | Option Awards(1) | | Stock Awards(2) | | Name | | Grant
Date | | Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable | | Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number of
Shares or
Units of
Stock That
Have Not
Vested
(#) | | Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(3) | | Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#) | | Equity
Incentive
Plan Awards:
Market Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)(3) | | | Grant
Date | | Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable | | Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number of
Shares or
Units of
Stock That
Have Not
Vested
(#) | | Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(3) | | 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
($)(3) | | (a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | | Paul Marciano | | 4/3/2008 | | | 34,300 | | | | — | | | 41.71 | | | 4/3/2018 | | | | — | | | | — | | | | — | | | | — | | | 4/29/2010 | | | 33,900 | | | | — | | | $ | 47.94 | | | 4/29/2020 | | | | — | | | | — | | | | — | | | | — | | | | 4/14/2009 | | | 160,000 | | | | — | | | 22.03 | | | 4/14/2019 | | | | — | | | | — | | | | — | | | | — | | | 4/15/2011 | | | 44,300 | | | | — | | | $ | 38.90 | | | 4/15/2021 | | | | — | | | | — | | | | — | | | | — | | | | 4/29/2010 | | | 33,900 | | | | — | | | 47.94 | | | 4/29/2020 | | | | — | | | | — | | | | — | | | | — | | | 3/28/2012 | | | 56,000 | | | | — | | | $ | 31.36 | | | 3/28/2022 | | | | — | | | | — | | | | — | | | | — | | | | 4/15/2011 | | | 44,300 | | | | — | | | 38.90 | | | 4/15/2021 | | | | — | | | | — | | | | — | | | | — | | | 4/3/2013 | | | 73,400 | | | | — | | | $ | 25.17 | | | 4/3/2023 | | | | — | | | | — | | | | — | | | | — | | | | 3/28/2012 | | | 56,000 | | | | — | | | 31.36 | | | 3/28/2022 | | | | — | | | | — | | | | — | | | | — | | | 4/28/2017 | (4) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 39,785 | | | 847,023 | | | | 4/3/2013 | | | 73,400 | | | | — | | | 25.17 | | | 4/3/2023 | | | | — | | | | — | | | | — | | | | — | | | 4/28/2017 | (5) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 174,025 | | | 3,704,992 | | | | 4/29/2016 | (4) | | | — | | | | — | | | | — | | | | — | | | 22,434 | | | 327,761 | | | | — | | | | — | | | 6/25/2018 | (6) | | | — | | | | — | | | | — | | | | — | | | 18,858 | | | 401,487 | | | | — | | | | — | | | | 4/29/2016 | (5) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 54,495 | | | 796,172 | | | 6/25/2018 | (7) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 45,809 | | | 975,274 | | | | 4/29/2016 | (6) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 81,248 | | | 1,187,033 | | | 6/25/2018 | (8) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 91,347 | | | 1,944,778 | | | | 4/28/2017 | (7) | | | — | | | | — | | | | — | | | | — | | | 110,664 | | | 1,616,801 | | | | — | | | | — | | | 6/20/2019 | (9) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 205,339 | | | 4,371,667 | | | | 4/28/2017 | (8) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 89,606 | | | 1,309,144 | | | Carlos Alberini | | | 2/20/2019 | (10) | | | — | | | 600,000 | | | $ | 21.38 | | | 2/20/2029 | | | | — | | | | — | | | | — | | | | — | | | | 4/28/2017 | (9) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 174,368 | | | 2,547,516 | | | 2/20/2019 | (11) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 250,000 | | | 5,322,500 | | | Victor Herrero | | 7/7/2015 | (10) | | 300,000 | | | 300,000 | | | 20.03 | | | 7/7/2025 | | | | — | | | | — | | | | — | | | | — | | | Maurice Marciano(12) | | | 4/29/2010 | | | 33,950 | | | | — | | | $ | 47.94 | | | 4/29/2020 | | | | — | | | | — | | | | — | | | | — | | | | 7/7/2015 | (11) | | | — | | | | — | | | | — | | | | — | | | 125,000 | | | 1,826,250 | | | | — | | | | — | | | 4/15/2011 | | | 66,525 | | | | — | | | $ | 38.90 | | | 4/15/2021 | | | | — | | | | — | | | | — | | | | — | | | | 4/29/2016 | (12) | | | — | | | | — | | | | — | | | | — | | | 16,349 | | | 238,859 | | | | — | | | | — | | | 2/4/2019 | (13) | | | — | | | | — | | | | — | | | | — | | | 9,174 | | | 195,314 | | | | — | | | | — | | | | 4/29/2016 | (5) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 54,495 | | | 796,172 | | | | | 4/29/2016 | (6) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 59,209 | | | 865,043 | | | | | 4/28/2017 | (13) | | | — | | | | — | | | | — | | | | — | | | 125,449 | | | 1,832,810 | | | | — | | | | — | | | | | 4/28/2017 | (8) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 89,606 | | | 1,309,144 | | | Kathryn Anderson | | | 12/2/2019 | (14) | | | — | | | 130,000 | | | $ | 19.15 | | | 12/2/2029 | | | | — | | | | — | | | | — | | | | — | | | | 4/28/2017 | (9) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 197,663 | | | 2,887,856 | | | 12/2/2019 | (14) | | | — | | | | — | | | | — | | | | — | | | 70,000 | | | 1,490,300 | | | | — | | | | — | | | Sandeep Reddy | | 9/13/2010 | | | 6,000 | | | | — | | | 37.33 | | | 9/13/2020 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 8/5/2013 | | | 18,000 | | | | — | | | 34.11 | | | 8/5/2023 | | | | — | | | | — | | | | — | | | | — | | | | | 4/2/2014 | | | 10,100 | | | | — | | | 28.98 | | | 4/2/2024 | | | | — | | | | — | | | | — | | | | — | | | | | 4/2/2015 | (14) | | 12,975 | | | 4,325 | | | 18.20 | | | 4/2/2025 | | | 2,175 | | | 31,777 | | | | — | | | | — | | | | | 3/30/2016 | (15) | | 14,750 | | | 14,750 | | | 18.82 | | | 3/30/2026 | | | 8,400 | | | 122,724 | | | | — | | | | — | | | | | 4/29/2016 | (5) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 22,888 | | | 334,394 | | | | | 3/29/2017 | (16) | | 8,219 | | | 24,656 | | | 11.22 | | | 3/29/2027 | | | 10,556 | | | 154,223 | | | | — | | | | — | | | | | 4/28/2017 | (8) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 51,747 | | | 756,024 | | |
| (1) | All options reported in the table above were granted under, and are subject to, the Company’s 2004 Equity Incentive Plan. The option expiration date shown in Column (f) above is the normal expiration date, and the latest date that the options may be exercised. The options may terminate earlier in certain circumstances described above. For each Named Executive Officer, the unexercisable options shown in Column (d) above were unvested as of February 3, 20181, 2020 and will generally terminate if the Named Executive Officer’s employment terminates prior to scheduled vesting. |
| (2) | All stock awards reported in the table above were granted under, and are subject to, the Company’s 2004 Equity Incentive Plan. |
| (3) | The market value of stock awards reported in Columns (h) and (j) is computed by multiplying the applicable number of shares of stock reported in Columns (g) and (i), respectively, by $14.61,$21.29, the closing market price of the Company’s Common Stock on February 2, 2018,January 31, 2020, the last trading day of fiscal 2018.2020. |
| (4) | Under the terms of the 2017 Licensing Award, since the Company’s earnings from operations derived from the Company’s licensing segment for fiscal 2017 exceeded the pre-established performance goal, the award will vest in three equal annual installments. One third of the award vested on each of January 30, 2017 and January 30, 2018, and the remaining installment will vest on January 30, 2019. |
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(5) | Under the terms of the 2017 LTIP Award, this award vests based on the Company’s revenue and operating income levels for the Company’s 2019 fiscal year. Between zero and 200% of the target number of restricted stock units subject to the award will vest based 50% on the Company’s revenue and 50% on the Company’s operating income for the Company’s 2019 fiscal year. The number reported above reflects the target number of units subject to the award. |
(6) | Under the terms of the 2017 Relative TSR Award, this award is subject to a relative TSR vesting requirement over a three year performance period. Between zero and 150% of the target number of restricted stock units subject to the award will vest based on the Company’s TSR compared to the TSRs for a peer group of companies approved by the Compensation Committee for the three year performance period consisting of the Company’s 2017, 2018 and 2019 fiscal years. The number reported above reflects the target number of units subject to the award because, had the applicable performance period ended at the end of fiscal 2018, the number of restricted stock units subject to the award that would have vested would have exceeded the threshold level but been at or less than the target level. |
(7) | Under the terms of the 2018 Licensing Award, since the Company’s earnings from operations derived from the Company’s licensing segment for fiscal 2018 exceeded the pre-established performance goal, the award will vest in three equal annual installments. One third of the award vested as of January 30, 2018, and the remaining installments will vest on each January 30 of 2019 and 2020. The entire number of restricted stock units originally subject to the award (including the portion that vested as of January 30, 2018) is included above as the entire award remained outstanding at the end of fiscal 2018 pending the Compensation Committee’s certification that the applicable fiscal 2018 performance goal had been attained. |
(8) | Under the terms of the 2018 LTIP Award, this award vests based on the Company’s revenue (excluding the Americas Retail segment) and earnings from operations for the Company’s 2020 fiscal year. Between zero and 200% of the target number of restricted stock units subject to the award will vest based 25% on the Company’s revenue (excluding the Americas Retail segment) and 75% on the Company’s earnings from operations for the Company’s 2020 fiscal year. The number reportedof restricted stock units included above reflectsis equal to 44.4% of the original target number of units subject tofor the award.award as that is the portion of the award that ultimately vested based on the Compensation Committee’s certification (in April 2020) of fiscal 2020 results versus the applicable performance goals. |
(9)(5) | Under the terms of the 2018 Relative TSR Award, this award is subject to a relative TSR vesting requirement over a three year performance period. Between zero and 150% of the target number of restricted stock units subject to the award will vest based on the Company’s TSR compared to the TSRs for a peer group of companies approved by the Compensation Committee for the three year performance period consisting of the Company’s 2018, 2019 and 2020 fiscal years. The number reported above reflects the actual number of units subject to the award (approximately 150% of the target number of units subject to the award) that ultimately vested based on the Compensation Committee’s certification (on February 7, 2020) of the applicable relative TSR performance. |
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| (6) | Under the terms of the 2019 Licensing Award, since the Company’s earnings from operations derived from the Company’s licensing segment for fiscal 2019 exceeded thepre-established performance goal, the award will vest in three equal annual installments. One third of the award vested on each of January 30, 2019 and January 30, 2020, and the remaining installment will vest on January 30, 2021. |
| (7) | Under the terms of the 2019 LTIP Award, this award vests based on the Company’s revenue (excluding the Americas Retail and Americas Wholesale segments) and earnings from operations for the Company’s 2021 fiscal year. Between zero and 200% of the target number of restricted stock units subject to the award will vest based 25% on the Company’s revenue (excluding the Americas Retail and Americas Wholesale segment) and 75% on the Company’s earnings from operations for the Company’s 2021 fiscal year. The number reported above reflects the target number of units subject to the award. |
| (8) | Under the terms of the 2019 Relative TSR Award, this award is subject to a relative TSR vesting requirement over a three year performance period. Between zero and 150% of the target number of restricted stock units subject to the award will vest based on the Company’s TSR compared to the TSRs for a peer group of companies approved by the Compensation Committee for the three year performance period consisting of the Company’s 2019, 2020 and 2021 fiscal years. The number reported above reflects the maximum number of units subject to the award (150% of the target number of units subject to the award) because, had the applicable performance period ended at the end of fiscal 2018,2020, the number of restricted stock units subject to the award that would have vested would have exceeded the target level. |
(10)(9) | Represents an award of stock options in fiscal 2016 in connection with Mr. Herrero’s commencement of employment which vests in four each annual installments. One fourthUnder the terms of the award vested on each of July 7, 2016 and July 7, 2017, and the remaining installments will vest on each of July 7 of 2018 and 2019. |
(11) | Represents an award of restricted stock unitsgranted to Mr. Paul Marciano in fiscal 2016 in connection with Mr. Herrero’s commencement of employment (the “2016 New-Hire Performance Share Award”). Since2020, since the Company’s earnings from operations derived from the Company’s licensing segment for fiscal 2020 and the Company’s earnings from operations for the last two quarters of fiscal 20162020 exceeded thepre-established performance goal for the award, the award vests in four equal installments. One fourth of the award vested on each of July 7, 2016 and July 7, 2017, and the remaining installments will vest on each of July 7 of 2018 and 2019. |
(12) | Under the terms of the 2017 Revenue Award, since the Company’s total revenues (excluding net royalties) for fiscal 2017 exceeded the pre-established performance goal,threshold, the award will vest in three equal annual installments. One third of the award vested on each of January 30, 2017 and January 30, 2018, and the remaining installment will vest on January 30, 2019. |
(13) | Under the terms of the 2018 Revenue Award, since the Company’s total revenues (excluding net royalties) for fiscal 2018 exceeded the pre-established performance goal, the award will vest in three equal annual installments. One third of the award vested as of January 30, 2018,2020, and the remaining installments will vest on each January 30 of 20192021 and 2020.2022. The entire number of restricted stock units originally subject to the award (including the portion that vested as of January 30, 2018)2020) is included above as the entire award remained outstanding at the end of fiscal 20182020 pending the Compensation Committee’s certification that the applicable fiscal 20182020 performance goalgoals had been attained. |
(14)(10) | Awards vest in four equal installments on each January 5February 20 of 2016, 2017, 20182020, 2021, 2022 and 2020.2023. |
(15)(11) | AwardsUnder the terms of the 2020 Revenue Award, since the Company’s total revenue for fiscal 2020 exceeded thepre-established performance threshold, the award will vest in four equal annual installments. One fourth of the award vested on February 20, 2020, and the remaining installments will vest on each February 20 of 2021, 2022 and 2023. The entire number of restricted stock units originally subject to the award (including the portion that vested as of February 20, 2020) is included above as the entire award remained outstanding at the end of fiscal 2020 pending the Compensation Committee’s certification that the applicable fiscal 2020 performance goal had been attained. |
| (12) | Mr. Maurice Marciano did not receive any compensation in connection with his service as our Interim Chief Executive Officer from February 2, 2019 to February 19, 2019. The outstanding equity awards reflected in the table above were either granted to Mr. Maurice Marciano in connection with his prior service as an executive of the Company through January 2012 or in connection with his service as the Chairman of our Board. |
| (13) | Award vested in full on February 4, 2020. |
| (14) | Award vests in four equal installments on each January 5December 2 of 2017, 2018, 20192020, 2021, 2022 and 2020.2023. |
(16) | Awards vest in four equal installments on each January 5 of 2018, 2019, 2020 and 2021. |
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Option Exercises and Stock Vested in Fiscal 20182020 The following table presents information regarding (i) the exercise of stock options by Named Executive Officers during fiscal 20182020 and (ii) the vesting during fiscal 20182020 of stock awards previously granted to the Named Executive Officers. | | | | Option Awards | | | Stock Awards | | | 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
($)(1) | | | Number of Shares
Acquired on
Exercise
(#) | | Value Realized
on Exercise
($)(1) | | Number of Shares
Acquired on
Vesting
(#) | | Value Realized
on Vesting
($)(2) | | (a) | | (b) | | | (c) | | | (d) | | | (e) | | | (b) | | (c) | | (d) | | (e) | Paul Marciano | | | — | | | | — | | | | 439,913 | | | | 7,470,161 | | | | | — | | | | | — | | | | 166,008 | | | | 3,785,740 | | Victor Herrero | | | — | | | | — | | | | 95,198 | | | | 1,423,025 | | | Carlos Alberini | | | | | — | | | | | — | | | | 150,000 | | | | 3,207,000 | | Maurice Marciano(3) | | | | | — | | | | | — | | | | 11,936 | | | | 240,988 | | Kathryn Anderson | | | | | — | | | | | — | | | | | — | | | | | — | | Sandeep Reddy | | | — | | | | — | | | | 13,044 | | | | 210,750 | | | | 62,531 | | | | 157,585 | | | | | — | | | | | — | |
| (1) | The dollar amounts shown in Column (c) above for option awards are determined by multiplying (i) the number of shares of the Company’s Common Stock to which the exercise of the option related, by (ii) the difference between theper-share closing price of the Company’s Common Stock on the date of exercise and the exercise price of the options. |
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| (2) | The dollar amounts shown in Column (e) above for stock awards are the sum of (1) the number of shares that vested multiplied by theper-share closing price of the Company’s Common Stock on the vesting date, plus (2) the aggregate cash value of any dividend equivalents received by the executive with respect to the applicable award. |
| (3) | The amounts reported for Mr. Maurice Marciano relate to the vesting of a restricted stock award that was granted for his service as anon-employee director. |
Pension Benefits Table—Fiscal 20182020 The following table presents information regarding the present value, computed as of February 3, 2018,1, 2020, of accumulated benefits that may become payable to the Named Executive OfficersMessrs. Paul Marciano and Alberini under the Company’s Supplemental Executive Retirement Plan, or SERP, the Company’s only defined benefit pension plan. | Name(1) | | Plan Name | | Number
of Years
Credited
Services
(#) | | | Present Value of
Accumulated Benefit
($)(2) | | | Payments During
Last Fiscal Year
($) | | | Plan Name | | Number
of Years
Credited
Services
(#) | | Present Value of
Accumulated Benefit
($)(1) | | Payments During
Last Fiscal Year
($) | Paul Marciano | | SERP | | | 24 | | | | 28,949,707 | | | | — | | | SERP | | | 24 | | | | 25,440,250 | | | | | — | | Carlos Alberini | | | SERP | | | 9 | | | | 4,033,763 | | | | | — | |
| (1) | No other Named Executive Officers were eligible to participate in the SERP during the covered period. |
(2) | The amount in this Column represents the actuarial present value, computed as of February 3, 2018,1, 2020, of the Named Executive Officer’s accrued aggregate pension benefit with respect to the SERP. The actuarial present value of accrued benefits is based on a discount rate of 3.5%2.5%, the RP 2014 Mortality Table (withwith MP 20172019 Mortality Projections)Projections and an assumed retirement age of 6773 for Mr. Paul Marciano.Marciano and 65 for Mr. Alberini. The assumptions used are the same as those used for financial reporting purposes and contained in Note 1213 (Defined Benefit Plans) to the Company’s Consolidated Financial Statements, included as part of the Company’s Fiscal 20182020 Annual Report on Form10-K. See footnote (3)(4) to the “Summary Compensation Table” above for more information concerning the year-over-year changes to the actuarial present value of Mr. Paul Marciano’sthe accrued aggregate pension benefitbenefits with respect to the SERP. |
The Company adopted the SERP in 2006 to provide certain selected executives with benefits upon retirement, termination of employment, death, disability or a change in control of the Company, in certain prescribed circumstances. The only active participantexecutive officers that were participants in the SERP as of February 3, 20181, 2020 were Messrs. Paul Marciano and Alberini. Mr. Alberini’s benefit was accrued with respect to his service to the Company between 2006 and 2010. Mr. Paul Marciano.Alberini is not accruing additional SERP benefits with respect to his current service as Chief Executive Officer. Annual benefits available under the SERP, or SERP Benefits, are calculated by multiplying the participant’s highest average compensation (including base salary and certain annual cash incentives) during any two of the final three full calendar years of employment by a percentage equal to 2.5% for each year of service, subject to a maximum benefit of 60% of such average compensation for Mr. Paul Marciano. Mr. Paul Marciano is fully vested in his SERP Benefits and has already attained the maximum permitted twenty-four years of service for 59
purposes of calculating SERP Benefits. As contemplated by the terms of the Paul Marciano Employment Agreement described above, theThe highest amount of “compensation” (as defined in the SERP) for Mr. Paul Marciano for any year following 2013 that will be taken into account for purposes of calculating his benefits under the plan will be $6,250,000, and if he retires or otherwise has a termination of employment for any reason other than for cause after January 31, 2016, his “average compensation” for purposes of his SERP benefit will be determined as of January 31, 2016. As noted above, Mr. Alberini is not accruing additional SERP benefits with respect to his service as Chief Executive Officer. His benefit is calculated based on his accrued service and compensation history when he ceased being the Company’s President and Chief Operating Officer in 2010. The change in the actuarial present value of Mr. Alberini’s SERP Benefits from fiscal 2019 to fiscal 2020, which amount is reported in the Summary 58
Compensation Table above as fiscal 2020 compensation for Mr. Alberini, is due primarily to (1) a reduction in the discount rate used in determining that present value from 3.75% in fiscal 2019 to 2.5% in fiscal 2020 and (2) Mr. Alberini being one year closer to the commencement of his benefits at age 65. SERP Benefits are generally payable over the lifetime of the participant, subject to the advance election by each participant to receive an actuarial equivalent in the form of a ten or fifteen year term-certain life annuity or a joint and 50% survivor annuity. The SERP Benefit amounts will be reduced by the amount of a participant’s estimated Social Security benefits. If a participant retires on or after reaching the age of 65, his SERP Benefit will begin to be paid in the form selected by the participant. If a participant’s employment is terminated prior to reaching the age of 65, his SERP Benefit will cease to accrue and he will begin to be paid in the form selected by the participant, commencing following the attainment of age 65. Upon a participant’s death or disability, the participant or his beneficiaries will generally be entitled to receive a lump sum actuarial equivalent of the applicable SERP Benefit. The SERP provides that if a participant experiences a termination of employment within twelve months following a change in control of the Company, the participant will be entitled to receive a lump sum actuarial equivalent of the applicable SERP Benefit as if such benefit had been completely vested following such termination. The present value of Mr. Paul Marciano’s accumulated benefit under the SERP at the end of fiscal 2012 was $37,059,275. Changes in actuarial factors have resulted in the present value of Mr. Paul Marciano’s accumulated benefit under the SERP being less than that amount at the end of each fiscal year subsequent to fiscal 2012. In accordance with applicable SEC rules, in years in which the present value of the benefit decreased, such as in fiscal 2020 and fiscal 2019, the change in the present value of the benefit for thatthose fiscal yearyears was reported as $0 (and not the actual amount of the reduction) in the Summary Compensation Table. In fiscal 2018,2020, the change in the present value of Mr. Paul Marciano’s accumulated benefit under the SERP (calculated as described above) actually increaseddecreased by $2,207,759 over$2,195,065 as compared to the prior year, due primarily to the updated mortality table and Mr. Paul Marciano being one year closercontinuing to remain employed past his assumedeligible retirement age. However, this amount remains less than, and is entirely offset by, the reductions in the present value of Mr. Paul Marciano’s accumulated benefit under the SERP between fiscal years 2013 and 2015. Non-Qualified Deferred Compensation Plan Table—Fiscal 20182020 The following table sets forth summary information regarding contributions to, earnings on, withdrawals from and account balances under the Company’sNon-Qualified Deferred Compensation Plan, or DCP, for and as of the fiscal year ended February 3, 2018.1, 2020 | Name | | Executive
Contributions
In Last
Fiscal Year
($)(1) | | | Registrant
Contributions
In Last
Fiscal Year
($)(2) | | | Aggregate
Earnings
In Last
Fiscal
Year
($) | | | Aggregate
Withdrawals/
Distributions
($) | | Aggregate
Balance
at Last
Fiscal
Year End
($) | | | Executive
Contributions
In Last
Fiscal Year
($)(1) | | Registrant
Contributions
In Last
Fiscal Year
($)(2) | | Aggregate
Earnings
In Last
Fiscal Year
($) | | Aggregate
Withdrawals/
Distributions
($) | | Aggregate
Balance
at Last
Fiscal
Year End
($)(3) | Paul Marciano | | | — | | | | — | | | | 392,984 | | | | 28,266 | (3) | | 2,183,893 | | | | | — | | | | 150 | | | | 325,861 | | | | | — | | | | 2,506,873 | | Victor Herrero | | | 200,000 | | | | 3,313 | | | | 254,582 | | | | — | | | 1,767,210 | | | Carlos Alberini | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | Maurice Marciano | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | Kathryn Anderson | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | Sandeep Reddy | | | 2,019 | | | | — | | | | 85,937 | | | | — | | | 525,074 | | | | 71,946 | | | | 150 | | | | 99,373 | | | | | — | | | | 766,898 | |
| (1) | Reflects base salary and/or annual cash incentive amounts contributed to the DCP by the Named Executive Officers during fiscal 2018.2020. Accordingly, these amounts are also included in Column (c) or (g), as applicable, of the “Summary Compensation Table” above.above or Column (g) of the “Summary Compensation Table” contained in our proxy statement filed with the SEC on May 13, 2019 with respect to our 2019 annual meeting of shareholders. |
| (2) | There were no discretionary Company contributions with respect to any of the Named Executive Officers during fiscal 2018.2020. The amount in this column represents contributions made by the Company during fiscal 20182020 under the terms of the DCP to “make up” for 401(k) match amounts that could not be made to such executive’s account under ourtax-qualified 401(k) plan (in which substantially all of our salaried employees |
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| are eligible to participate) due to applicable Internal Revenue Code limits. These amounts are also included in Column (i) of the “Summary Compensation Table” above. |
59
| (3) | UnderTo the DCP, a participant may elect, atextent the time he or she elects to defer compensation underexecutive officers were Named Executive Officers in prior years, the plan, to have the benefits resulting from that deferral paid out on a specified dateamounts reported in the future. This amount reflects such a scheduled distribution. That is, this amount represents a distribution of benefitsaggregate balance at last fiscal year end that represented prior base salary and annual cash incentive award deferrals or Company contributions were previously reported as compensation to the participant elected,Named Executive Officers in our “Summary Compensation Table” as “Salary,”“Non-Equity Incentive Plan Compensation” or “All Other Compensation” in previous years. Amounts reported in the aggregate balance at the time of his original deferral for alast fiscal year end that represent earnings in prior to fiscal 2018, be paid outyears on a date that occurred during fiscal 2018.previously deferred amounts are not reflected in prior period Summary Compensation Tables. |
Under the DCP, select employees who satisfy certain eligibility requirements, including each of the Named Executive Officers, and members of the Board may make annual irrevocable elections to defer up to 75% of their base salary, 100% of their annual cash incentive, 100% of their cash compensation earned under any Company long-term incentive plan or 100% of their director fees to be earned during the following calendar year. In addition, the Company makes contributions to “make up” for Company match amounts under the Company’s 401(k) plan that cannot be made to Named Executive Officers because of applicable Internal Revenue Code limits. Account balances are credited with income, gains and losses based on the performance of investment funds selected by the participant from a list of funds designated by the Company. Participants are at all times 100% vested in the amounts credited to their deferral accounts with respect to their deferrals. Amounts credited with respect to lost 401(k) match amounts are subject to the same vesting requirements provided in the Company’s 401(k) plan and amounts credited with respect to discretionary Company contributions are subject to vesting requirements, if any, imposed on such amounts by the Company. Participants will be eligible to receive distributions of the amounts credited to their accounts at or after their termination of employment, retirement, disability, death, change in control of the Company or upon another previously determined scheduled distribution date, in a lump sum or installments pursuant to elections made under the rules of the DCP. For the Named Executive Officers, Section 409A of the Internal Revenue Code requires that distributions may not occur earlier than six months following the Named Executive Officer’s termination of employment (excluding termination due to disability or death). The DCP is not required to be funded by the Company, until benefits become payable, and participants have an unsecured contractual commitment by the Company to pay the amounts due under the DCP. The Company has purchased corporate-owned life insurance to help offset this liability. The Company did not make any discretionary contributions under the DCP during fiscal 2018.2020. Potential Payments Upon Termination or Change in Control The following section describes the benefits that may become payable to each of our Named Executive Officers in connection with a termination of their employment and/or a change in control of the Company. As prescribed by SEC rules, in calculating the amounts of any potential payments to the Named Executive OfficersMessrs. Paul Marciano and Alberini and Ms. Anderson described below, we have assumed that the termination and/or change in control occurred on the last business day of fiscal 2018.2020. For Mr. Reddy, we have described the actual severance benefits he received in connection with his termination of employment effective December 1, 2019. Mr. Maurice Marciano did not receive any severance benefits in connection with his service as our Interim Chief Executive Officer. The benefits described below do not include any amounts with respect to fully vested SERP, DCP or 401(k) benefits or vested and unexercised stock options where no additional benefit is provided thereunder to the Named Executive Officer as a result of a termination or change in control. As reflected in the tables below and as discussed below and in the “Description of Plan-Based Awards” section above, outstanding equity-based awards held by our Named Executive Officers may also be subject to accelerated vesting in certain circumstances in connection with a termination of their employment and/or a change in control. Paul Marciano The Paul Marciano Employment Agreement provides that if Mr. Paul Marciano’s employment with the Company is terminated by the Company without cause (as definedexpired according to its terms in the Paul Marciano Employment Agreement) or byJanuary 2019. Accordingly, Mr. Paul Marciano for good reason (as defined in the Paul Marciano Employment Agreement), Mr. Paul Marciano will bewould not have been entitled to receive, subject to Mr. Paul Marciano delivering a release of claims in favor of the Company, the following separation benefits: (i) a lump sumany severance payment equal to three times the sum ofif his employment was terminated 6160
his base salary and then target annual cash incentive; and (ii) a pro-rata portion of his annual cash incentive for the performance year in which the termination occurs (pro-rata based on the number of days of employment during the year) based upon actual performance as if his employment had continued through the end of the year. If Mr. Paul Marciano retires without good reason, and/or if his employment by the Company terminates at the end of the term of the Paul Marciano Employment Agreement, he will be entitled to receive a pro-rata portion of his annual cash incentive for the performance year in which the termination occurs (pro-rata based on the number of days of employment during the year) based upon actual performance had employment continued through the end of the year. If Mr. Paul Marciano’s employment with the Company terminates on account of his death or disability (as defined in the Paul Marciano Employment Agreement), Mr. Paul Marciano (or his estate) will be entitled to receive a pro-rata portion of his target annual cash incentive for the performance year in which the termination occurs (pro-rata based on the number of days of employment during the year).
Mr. Paul Marciano is not entitled to a change in control excise tax gross-up provision under the termsoccurred as of the Paul Marciano Employment Agreement or any other agreement entered into with the Company. Should Mr. Paul Marciano’s payments, rights or benefits (whether under an employment agreement or any other plan or arrangement) be subject to the excise tax imposed under Sections 280G and 4999last day of the Internal Revenue Code, the Paul Marciano Employment Agreement provides that such payments, rights or benefits will be reduced to the extent necessary so that no portion of such payments, rights or benefits will be subject to such excise tax, but only if, by reason of such reduction, the net after-tax benefit received byfiscal 2020. Mr. Paul Marciano will exceed the net after-tax benefit that he would receive if no such reduction was made.
Mr. Paul Marciano may also be entitled to certain accelerated vesting of outstanding equity awards in connection with certain terminations of his employment and in connection with certain change in control events impacting the Company. See “—Description“Description of Plan-Based Awards—Performance-Based Restricted Stock Units” above for a description of the material terms of certain of these benefits. Mr. Paul Marciano also received equity awards in fiscal 2016 and2019 that had the following provisions for accelerated vesting:
2019 Licensing Award.In fiscal 20172019, Mr. Paul Marciano was granted an award of restricted stock units that were similar in structureeligible to vest based on the Company’s licensing earnings for fiscal 2019 (the “2019 Licensing Award”). The applicable performance condition with respect to the 2018 Licensing Award was met in fiscal 2019 and included the same provisions respectingaward vests in three equal installments, withone-third of the stock units vesting on January 30 of 2019, 2020 and 2021. If a change in control occurred and the awards were terminated in connection with the transaction (that is, it is not continued following such event or assumed or converted by the successor entity), the restricted stock units subject to the award would become fully vested as of the date of the change in control. If Mr. Paul Marciano’s employment terminates due to a termination by the Company without cause (as defined in his previous employment agreement), by the executive for good reason (as defined in his previous employment agreement), or due to his death or disability, any outstanding and unvested restricted stock units subject to the award will become fully vested as of the termination date. 2019 Relative TSR Awards.In fiscal 2019, Mr. Paul Marciano was granted an award of restricted stock units that were eligible to vest based upon the Company’s TSR for a three-year performance period consisting of fiscal 2019 through fiscal 2021 relative to the TSRs during that performance period of a peer group of companies selected by the Compensation Committee (the “2019 Relative TSR Award”). In the event that, during the performance period and prior to a change in control, Mr. Paul Marciano’s employment terminates due to a termination by the Company without cause or by the executive for good reason (as defined in his previous employment agreement), the target number of units will be prorated by multiplying the target number by a fraction, the numerator of which is the number of days Mr. Paul Marciano was employed during the performance period, and the denominator of which is total number of days in the performance period, and the prorated number of target units would remain outstanding and eligible to vest based on the Company’s relative TSR for the entire three-year performance period. If Mr. Paul Marciano’s death or disability (as defined in his previous employment agreement) occurs during the performance period, performance will be deemed satisfied at the target level. If a change in control (as defined in Mr. Paul Marciano’s employment agreement) occurs during the performance period, the awards will be eligible to vest based on the Company’s relative TSR for the performance period through the change in control (if the change in control occurs during the second or third year of the performance period). If the award continues following such event or is assumed or converted by the successor entity, the number of units that are eligible to vest will vest on the last day of the original performance period subject to Mr. Paul Marciano’s continued employment through the vesting date and to accelerated vesting if his employment terminates due to a termination by the Company without cause, by the executive for good reason, or as a result of his death or disability. Such units will vest upon the change in control if the award is to be terminated in connection with the change in control transaction (that is, the award does not continue following such event and is not assumed or converted by the successor entity). 2019 LTIP Awards. In fiscal 2019, Mr. Paul Marciano was granted an award of restricted stock units that were eligible to vest based 25% upon the Company’s revenue (excluding the Americas Retail and Americas Wholesale segments) and 75% upon the Company’s earnings from operations for fiscal 2021 as determined in accordance with GAAP and as reflected in the Company’s financial reports (the “2019 LTIP Award”). In the event that, during the performance period and prior to a change in control, Mr. Paul Marciano’s employment terminates due to a termination by the Company without cause (as defined in his previous employment agreement) or by such executive for good reason (as defined in his previous employment agreement), the target number of units will be prorated by multiplying the target number by a fraction, the numerator of which is the number of days the executive was employed during the performance period, and the denominator of which is total number of days in the performance period, and the prorated number of target units would remain 61
outstanding and eligible to vest based on the Company’s revenue and earnings from operations for fiscal 2021. If Mr. Paul Marciano’s death or disability (as defined in his previous employment agreement) occurs during the performance period, performance will be deemed satisfied at the target level. If a change in control (as defined in the executive’s employment agreement) occurs during the performance period, the awards will be eligible to vest as to the target number of units. If the award continues following such event or is assumed or converted by the successor entity, the target number of units will remain eligible to vest on the last day of the original performance period subject to Mr. Paul Marciano’s continued employment through the vesting date and to accelerated vesting if the executive’s employment terminates due to a termination by the Company without cause, by the executive for good reason, or as a result of his death or disability. The target number of units will vest upon the change in control if the award is to be terminated in connection with the change in control transaction (that is, the award does not continue following such event and is not assumed or converted by the successor entity). The following table sets forth the estimated amounts that Mr. Paul Marciano would have become entitled to under the terms of his award agreements evidencing outstanding equity awards had his employment with the Company terminated and/or a change in control of the Company afteroccurred on the performance period as the 2018 Licensing Award described above. Mr. Paul Marciano was also granted a 2016 TSR Award and 2017 Relative TSR Award that was similar in structure to the 2018 Relative TSR Award and included the same provisions respecting a terminationlast business day of employment or change in control of the Company after the performance period as the 2018 Relative TSR Award described above.fiscal 2020. Victor Herrero
| | | | | | | | | | | Name | | Triggering Event | | Value of
Accelerated
Restricted
Stock,
Restricted
Stock Units
and Unvested
Options
($)(1)(2) | | | Total
($) | | Paul Marciano | | Death / Disability | | | 7,044,946 | | | | 7,044,946 | | | | Term. Without Cause or Resign for Good Reason (No Change in Control) | | | 4,773,154 | | | | 4,773,154 | | | | Change in Control | | | — | | | | — | | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | | 7,693,205 | | | | 7,693,205 | |
| (1) | Represents the intrinsic value of Mr. Paul Marciano’s unvested restricted stock unit awards that would accelerate in the circumstances indicated. The value of unvested restricted stock and stock unit awards is calculated by multiplying $21.29 (the closing price of the Company’s Common Stock on the NYSE on January 31, 2020, the last trading day of fiscal 2020) by the number of shares subject to the accelerated portion of the award. In the case of a “Term. Without Cause or Resign for Good Reason (No Change in Control),” includes no value as to the 2019 Relative TSR Awards and 2019 LTIP Awards because, in these circumstances, the target number of shares subject to the award would bepro-rated and would continue to be subject to the applicable performance-based vesting conditions. In the case of a “Term. Without Cause or Resign for Good Reason in Connection with a Change in Control,” assumes the maximum level of performance for the 2019 Relative TSR Awards (which was the actual performance level as of the last business day of fiscal 2020) and a “target” level of performance for the 2019 LTIP Awards. |
| (2) | None of the awards held by Mr. Paul Marciano would automatically vest on a change in control of the Company. This presentation assumes that the awards would be continued following the transaction or assumed or converted by a successor entity. If the awards were to be terminated in connection with the transaction (and not assumed or converted by a successor entity), all of the outstanding and unvested equity awards held by the executive would accelerate. In such circumstances, the value of Mr. Paul Marciano’s awards that would vest in connection with the termination of the awards would be $7,693,205. To the extent the awards accelerated in connection with a termination of the awards, there would be no additional accelerated vesting value with respect to such awards in connection with a termination of employment. |
Carlos Alberini The HerreroAlberini Employment Agreement provides that if Mr. Herrero’sAlberini’s employment with the Company is terminated by the Company without cause (as defined in the HerreroAlberini Employment Agreement), upon expiration of the term of the agreement then in effect by reason of the Company’s delivery of a notice ofnon-renewal if the Company did not have cause to deliver suchnon-renewal notice, or by Mr. HerreroAlberini for good reason (as defined in the HerreroAlberini Employment Agreement), Mr. HerreroAlberini will be entitled to receive, subject to his delivering a release of claims in favor of the Company, the following separation benefits: (1) payment of an aggregate amount equal to two times his base salary, with such amount generally payable in 24 substantially equal monthly installments following the termination of employment (or, in the event such termination of employment occurs 62
within 12 months before, upon or within two years after a change in control (as defined in the agreement), lump sum payment of an aggregate amount equal to two times the sum of his base salary and target annual cash incentive); (2) apro-rata portion of his annual cash incentive for the year in which the termination occurs (pro-rata(pro-rata based on the number of days of employment during the year and based on actual performance for the year had his employment continued through the year); (3) reimbursement of Mr. Herrero’sAlberini’s life insurance premiums of up to $10,000 per year for up to two years; and (4) payment or reimbursement of Mr. Herrero’sAlberini’s premiums to continue healthcare coverage under COBRA for up to 24 months. Mr. HerreroAlberini may also be entitled to certain accelerated vesting of outstanding equity awards in connection with certain terminations of his employment and in connection with certain change in control events impacting 62
the Company. See “—Description“Description of Plan-Based Awards—Performance-Based Restricted Stock Units”Awards” above for a description of the material terms of these benefits. In addition, to the extent the 2016 New-Hire Performance Share Award granted toevent Mr. Herrero in July 2015Alberini’s employment is then outstanding and otherwise unvested, such award will become fully vested on the termination date. The 2016 New-Hire Performance Share Award will also fully vest if a change in control occurs and the awards are to be terminated in connection witha manner entitling him to severance as described in the transaction (that is, the award is not continued following such event or assumed or converted by the successor entity). Aspreceding paragraph, as to each other stock option, restricted stock, restricted stock unit or similar equity award granted to Mr. HerreroAlberini by the Company that is then outstanding and otherwise unvested (and unless otherwise provided(notwithstanding anything contained in the applicable award agreement)agreement or the 2004 Equity Incentive Plan), (a) the equity award will vest as to apro-rata portion of the number of shares subject to the award covered by the next time and service-based vesting installment applicable to the award that is otherwise scheduled to vest after the date of Mr. Herrero’sAlberini’s termination of employment (pro-rata(pro-rata based on the number of days of employment during the period beginning on the last time and service-based vesting date under the applicable award that occurred prior to the termination of employment and ending on the next time and service-based vesting date under the applicable award that was next scheduled to occur after the termination of employment), and (b) as to an award that is subject to performance-based vesting requirements, the award will remain subject to the applicable performance-based vesting conditions and thepro-rata vesting provided for above will apply only as to the next installment scheduled to vest pursuant to the time and service-based vesting conditions applicable to the award. If, however, such a termination of Mr. Herrero’sAlberini’s employment occurs within 12 months before, upon, or within two years after a change in control, as to each such stock option, restricted stock, restricted stock unit or similar equity award granted to Mr. HerreroAlberini by the Company that is then outstanding and otherwise unvested (and did not otherwise accelerate pursuant to the foregoing provisions), the time and service-based vesting condition applicable to the equity award will no longer apply in its entirety, and any performance-based condition and timing of payment of the award will be as provided in the applicable award agreement. If Mr. Herrero’sAlberini’s employment terminates due to his death or disability (as defined in the HerreroAlberini Employment Agreement), he will be entitled to receive the following separation benefits: (1) payment of thepro-rata annual cash incentive described above for the year in which his employment terminates except that thepro-rata annual cash incentive will be based on the “target” level of performance for the year;year and(2) pro-rata accelerated vesting of each of his then outstanding and unvested equity awards (including the 2016 New-Hire Performance Share Award) as described above. Mr. HerreroAlberini is not entitled to a change in control excise taxgross-up provision under the terms of the HerreroAlberini Employment Agreement or any other agreement entered into with the Company. Should Mr. Herrero’sAlberini’s payments, rights or benefits (whether under an employment agreement or any other plan or arrangement) be subject to the excise tax imposed under Sections 280G and 4999 of the Internal Revenue Code, the HerreroAlberini Employment Agreement provides that such payments, rights or benefits will be reduced to the extent necessary so that no portion of such payments, rights or benefits will be subject to such excise tax, but only if, by reason of such reduction, the netafter-tax benefit received by Mr. HerreroAlberini will exceed the netafter-tax benefit that he would receive if no such reduction was made. 63
The following table sets forth the estimated amounts that each of Mr. Paul Marciano and Mr. HerreroAlberini would have become entitled to under the terms of their respectivehis employment agreementsagreement and award agreements evidencing outstanding equity awards had theirhis employment with the Company terminated and/or a change in control of the Company occurred on the last business day of fiscal 2018.2020. | | | | | | | | | | | | | | | | | | | | | | | Name | | Triggering Event | | Cash
Severance
($)(1) | | | Annual
Cash
Incentive
($)(2) | | | Medical and
Insurance
Benefit
($) | | | Value of
Accelerated
Restricted
Stock,
Restricted
Stock Units
and Unvested
Options
($)(3) | | | Total
($) | | Paul Marciano | | Death / Disability | | | — | | | | 3,747,750 | | | | — | | | | 5,797,086 | | | | 9,544,836 | | | | Retirement | | | — | | | | 3,747,750 | | | | — | | | | — | | | | 3,747,750 | | | | Term. Without Cause or Resign for Good Reason (No Change in Control) | | | 10,345,500 | | | | 3,747,750 | | | | — | | | | 1,944,562 | | | | 16,037,812 | | | | Change in Control | | | — | | | | — | | | | — | | | | — | (4) | | | — | | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | | 10,345,500 | | | | 3,747,750 | | | | — | | | | 6,270,510 | | | | 20,363,760 | | | | | | | | | Victor Herrero | | Death / Disability | | | — | | | | 3,600,000 | | | | — | | | | 6,359,623 | | | | 9,959,623 | | | | Retirement | | | — | | | | 3,600,000 | | | | — | | | | — | | | | 3,600,000 | | | | Term. Without Cause or Resign for Good Reason (No Change in Control) | | | 2,400,000 | | | | 3,600,000 | | | | 43,847 | (5) | | | 3,897,919 | | | | 9,941,766 | | | | Change in Control | | | — | | | | — | | | | — | | | | — | (4) | | | — | | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | | 7,200,000 | | | | 3,600,000 | | | | 43,847 | (5) | | | 8,309,087 | | | | 19,152,934 | |
| | | | | | | | | | | | | | | | | | | | | | | Name | | Triggering Event | | Cash
Severance
($)(1) | | | Annual
Cash
Incentive
($)(2) | | | Medical and
Insurance
Benefit
($)(3) | | | Value of
Accelerated
Restricted
Stock,
Restricted
Stock Units
and
Unvested
Options
($)(4)(5) | | | Total
($) | | Carlos Alberini | | Death / Disability | | | — | | | | 2,400,000 | | | | — | | | | 1,261,305 | | | | 3,661,305 | | | | Term. Without Cause or Resign for Good Reason (No Change in Control) | | | 2,400,000 | | | | 1,842,454 | | | | 92,360 | | | | 5,322,500 | | | | 9,657,314 | | | | Change in Control | | | — | | | | — | | | | — | | | | — | | | | — | | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | | 7,200,000 | | | | 1,842,454 | | | | 92,360 | | | | 5,322,500 | | | | 14,457,314 | |
| (1) | Represents an amount equal to equal to (i) for Mr. Paul Marciano, three times the sum of his base salary and target annual cash incentive and (ii) for Mr. Herrero, two times hisMr. Alberini’s base salary (or, in the case of a “Term. Without Cause or Resign for Good Reason in Connection with Change in Control,” two times the sum of Mr. Herrero’shis base salary and target annual cash incentive). |
| (2) | Represents the actualapro-rata portion of Mr. Alberini’s target cash incentive award paid with respect tofor fiscal 2018 performance.2020, in the case of “Death/Disability” and apro-rata portion of Mr. Alberini’s actual fiscal 2020 cash incentive award, in the case of “Term. Without Cause or Resign for Good Reason.” |
| (3) | Represents the value of life insurance premium payments and continuing medical coverage for two years following a termination without cause or resignation for good reason. |
| (4) | Represents the intrinsic value of the executive’sMr. Alberini’s unvested stock options and unvested restricted stock and stock unit awards that would accelerate in the circumstances indicated. In the case of unvested stock options, this value is calculated by multiplying (i) the amount (if any) by which $14.61$21.29 (the closing price of the Company’s Common Stock on the NYSE on February 2, 2018,January 31, 2020, the last trading day of fiscal 2018)2020) exceeds the per share exercise price of the option, by (ii) the number of shares subject to the accelerated portion of the award. In the case of unvested restricted stock and stock unit awards, this value is calculated by multiplying $14.61 (the closing price of the Company’s Common Stock on the NYSE on February 2, 2018, the last trading day of fiscal 2018)$21.29 by the number of shares subject to the accelerated portion of the award. In the case of a “Term. Without Cause or Resign for Good Reason in Connection with Change in Control” assumes the “target” level of performance for the 2018 Relative TSR Awards and 2018 LTIP Awards. In the case of a “Term. Without Cause or Resign for Good Reason (No Change in Control),” includes no value as to the 2017 and 2018 Relative TSR Awards and 2017 and 2018 LTIP Awards because, in these circumstances, the target number of shares subject to the award would be pro-rated and would continue to be subject to the applicable performance-based vesting conditions. |
(4)(5) | None of the awards held by Mr. Paul Marciano or Mr. HerreroAlberini would automatically vest on a change in control of the Company. This presentation assumes that the awards would be continued following the transaction or assumed or converted by a successor entity. If the awards were to be terminated in connection with the transaction (and not assumed or converted by a successor entity), all of the outstanding and unvested equity awards held by the executive would accelerate. In such circumstances, the value of Mr. Paul Marciano’s and Mr. Herrero’sAlberini’s awards that would vest in connection with the termination of the awards would be $6,270,510 and $8,309,087, respectively.$5,322,500. To the extent the awards accelerated in connection with a termination of the awards, there would be no additional accelerated vesting value with respect to such awards in connection with a termination of employment. |
(5) | Represents the value of life insurance premium payments and continuing medical coverage for two years following a termination without cause or resignation for good reason. |
Sandeep ReddyKathryn Anderson
Pursuant to the terms of the ReddyThe Anderson Letter provides that if the Company terminated Mr. Reddy’sMs. Anderson’s employment for reasons other than for cause (as defined in the ReddyAnderson Letter) (and other than due to hisher death or disability) or if Mr. ReddyMs. Anderson resigns for good reason (as defined in the ReddyAnderson Letter), Mr. ReddyMs. Anderson will be entitled to receive, subject
64
to hisher delivering a release of claims in favor of the Company and compliance with a 24 month post-terminationnon-solicitation of employees and consultants restrictive covenant, (1) continued payment of hisher base salary (as severance pay) for one year following the date hisher employment terminates (or, in the event such termination of employment occurs within 3 months before, upon or within 18 months after a change in control (as defined in the ReddyAnderson Letter) of the Company, lump sum payment of an aggregate amount equal to one andone-half times the sum of hisher base salary and target annual cash incentive,incentive), (2) payment of apro-rated target annual cash incentive for the year of termination(pro-rata based on the number of days of employment during the year and based on actual performance for the year had her employment continued through the year), and (3) payment or reimbursement of hisher premiums to continue healthcare coverage under COBRA for up to 12 months).months. 64
The following table sets forth the estimated amounts that Mr. ReddyMs. Anderson would have become entitled to under the terms of hisher employment offer letter and the other plans in which he participatedaward agreements evidencing outstanding equity awards had hisher employment with the Company terminated in the circumstances described below and/or a change in control of the Company occurred on the last business day of fiscal 2018.2020. | Name | | Triggering Event | | Cash
Severance
($)(1) | | Annual
Cash
Incentive
($)(2) | | Medical and
Insurance
Benefit
($) | | Value of
Accelerated
Restricted
Stock,
Restricted
Stock Units
and
Unvested
Options
($)(3) | | Total
($) | | | Triggering Event | | Cash
Severance
($)(1) | | Annual
Cash
Incentive
($)(2) | | Medical and
Insurance
Benefit
($)(3) | | Value of
Accelerated
Restricted
Stock,
Restricted
Stock Units
and
Unvested
Options
($)(4) | | Total
($) | | Sandeep Reddy | | Death / Disability | | | — | | | 787,500 | | | | — | | | 474,942 | | | 1,262,442 | | | Kathryn Anderson | | | Death / Disability | | | — | | | | — | | | | — | | | | — | | | | — | | | | Term. Without Cause or Resign for Good Reason | | 525,000 | | | | — | | | | — | | | | — | | | 525,000 | | | Term. Without Cause or Resign for Good Reason | | 550,000 | | | 200,000 | | | 12,168 | | | | — | | | 762,168 | | | | Change in Control | | | — | | | | — | | | | — | | | 820,133 | | | 820,133 | | | Change in Control | | | — | | | | — | | | | — | | | 1,768,500 | | | 1,768,500 | | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | 1,378,125 | | | 787,500 | | | 50,124 | (4) | | 820,133 | | | 3,035,882 | | | Term. Without Cause or Resign for Good Reason in Connection with Change in Control | | 975,000 | | | 200,000 | | | 12,168 | | | 1,768,500 | | | 2,955,668 | |
| (1) | Represents an amount equal to equal to one times Mr. Reddy’sMs. Anderson’s base salary (or, in the case of a “Term. Without Cause or Resign for Good Reason in Connection with Change in Control,” one and one half times the sum of Mr. Reddy’sAnderson’s base salary and target annual cash incentive). |
| (2) | Represents theapro-rata portion of Ms. Anderson’s actual fiscal 2020 cash incentive award paid with respect to fiscal 2018 performance.award. |
| (3) | Represents the value of continuing medical coverage for one year following a termination without cause or resignation for good reason. |
| (4) | The equity awards granted to Mr. Reddy (other than the 2018 LTIP Award)Ms. Anderson generally would, to the extent outstanding and otherwise unvested, accelerate upon a change in control of the Company. This amount represents the intrinsic value of the executive’s unvested stock options and unvested restricted stock and stock unit awardsaward that would accelerate in those circumstances. In the case of unvested stock options, this value is calculated by multiplying (i) the amount (if any) by which $14.61$21.29 (the closing price of the Company’s Common Stock on the NYSE on February 2, 2018,January 31, 2020, the last trading day of fiscal 2018)2020) exceeds the per share exercise price of the option, by (ii) the number of shares subject to the accelerated portion of the award. In the case of the unvested restricted stock and stock unit awards,award, this value is calculated by multiplying $14.61 (the closing price of the Company’s Common Stock on the NYSE on February 2, 2018, the last trading day of fiscal 2018)$21.29 by the number of shares subject to the accelerated portion of the award. As to the 2017 LTIP Award and 2018 LTIP Award, this presentation assumes that the awards would be continued following the transaction or assumed or converted by a successor entity. If the awards were to be terminated in connection with the transaction (and not assumed or converted by a successor entity), the 2017 LTIP Award and 2018 LTIP Award would accelerate and fully vest as to the target number of units. In such circumstances, the value of all of Mr. Reddy’s awards that would vest in connection with the termination of the awards would be $1,910,551. |
(4) | Represents the value of continuing medical coverage for one year following a termination without cause or resignation for good reason upon or 18 months following a change in control. |
Sandeep Reddy The Company entered into a Separation Agreement with Mr. Reddy in connection with the December 1, 2019 termination of Mr. Reddy’s employment with the Company. The Separation Agreement provided that the Company will pay a severance payment of $650,000 to Mr. Reddy, with such amount to be paid in 12 equal installments in accordance with the Company’s normal payroll schedule. If Mr. Reddy begins employment or enters into a consulting engagement within one year of his separation, the Company may reduce the amount of severance payments by the amount of compensation Mr. Reddy receives for such other employment or service. Pursuant to the terms of the Separation Agreement, Mr. Reddy agreed to a 24 month post-terminationnon-solicitation provision, agreed to anon-disparagement provision and provided a general release of claims in favor of the Company. He also affirmed that the terms of his confidentiality agreement with the Company will continue to apply. CEOPay-Ratio Disclosure Pursuant to the Exchange Act, we are required to disclose in this Proxy Statement the ratio of the total annual compensation of our principal executive officer for fiscal 2020, Mr. Herrero,Alberini, to the median of the total annual compensation of all of our employees (excluding our CEO). Based on SEC rules for this disclosure and applying the methodology described below, we have determined that our CEO’s total compensation for fiscal 20182020 was 65
$8,643,565, $17,383,574, and the median of the total fiscal 20182020 compensation of all of our employees (excluding our CEO) was $11,388.$10,960. Accordingly, we estimate the ratio of our CEO’s total compensation for fiscal 20182020 to the median of the total fiscal 20182020 compensation of all of our employees (excluding our CEO) to be 7591,586 to 1.
To identify
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Applicable SEC rules permit us to use the same median employee in calculating the pay ratio above as the median employee we usedidentified in 2018 in presenting the following methodology: pay ratio in our proxy statement for our annual meeting of shareholders held in 2018 (the “2018 median employee”) if there have been no changes that we reasonably believe would significantly affect this pay ratio disclosure and to substitute another employee for the median employee in certain circumstances. We selected January 22, 2018 (approximately two weeks priorbelieve that there have been no changes to our fiscal year end) as the date we would use to determine the employee population or compensation arrangements that would result in a significant change to the pay ratio disclosure. However, in fiscal 2019, the 2018 median employee ceased to be used in determiningemployed with the median employee. We determined that,Company. Therefore, as of that date, we (including our subsidiaries) employed 14,328 employees, including full-time, part-time, seasonal and temporary employees. Of the 14,328 employees, 8,412 were employed outside of the United States. As permitted by the SEC rules, from that group of employees we excluded all employees who were employed in the following countries (a total of 694 employees): Australia (238 employees), Brazil (103 employees), Russia (329 employees) and Singapore (24 employees). The total number of excluded employees equaled approximately 4.8% of the total employee population as of January 22, 2018, resulting in a total employee population of 13,634 that was used in determining the median employee.
We used total cash compensation paid in calendar 2017 to determine the median employee. We believe total cash compensation for all employees is an appropriate measure because we do not distribute equity awards to all employees. We did not make any cost-of-living adjustments in identifying the median employee.
Compensation values for our non-U.S. employees were converted to U.S. dollars by using the same foreign currency exchange rates that we use for financial reporting purposes.
As permitted by the SEC rules, we annualized the compensationare substituting another employee for purposes of employees (other than seasonal and temporary employees) locatedthis pay ratio disclosure for fiscal 2020. This substitute employee worked in the U.S., Canadasame position, had substantially similar compensation arrangements as the 2018 median employee, and Europe (locations where data concerning seasonal and temporary status was readily available) who were employed with us on January 22,would have been the 2018 but were not employed for all of 2017. We did not annualizemedian employee had the compensation of seasonal or temporary employees and we did not convertactual 2018 median employee been excluded from the compensation of part-time employees to a full-time equivalency.
Applying this methodology, we determined that ourdetermination. The fiscal 2020 median employee was a part-time, hourly retail store associate in one of our U.S. store locations.
Once the median employee was identified as described above, that employee’s total annual compensation for fiscal 20182020 was determined using the same rules that apply to reporting the compensation of our Named Executive Officers (including our CEO) in the “Total” column of the Summary Compensation Table. We have annualized the compensation of our CEO (including his base salary, automobile expenses and health insurance related expenses)for fiscal 2020 as he was not employed for the first 17 days of the fiscal year. The total compensation amounts included in the first paragraph of thispay-ratio disclosure were determined based on that methodology. This pay ratio is an estimate calculated in a manner consistent with SEC rules based on the methodology described above. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. 66
EQUITY COMPENSATION PLAN INFORMATION The following table sets forth, for each of the Company’s equity compensation plans, the number of shares of Common Stock subject to outstanding options and restricted stock unit awards, the weighted-average exercise price of outstanding options, and the number of shares remaining available for future award grants, in each case, as of February 3, 2018.1, 2020. | 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
($) | | Number of Securities
Remaining
Available for Future
Issuance Under Equity
Compensation Plans
(excluding securities
reflected
in Column (a)) | | | Number of
Securities to be
Issued
Upon Exercise of
Outstanding
Options,
Warrants and
Rights | | Weighted-Average
Exercise Price of
Outstanding
Options,
Warrants and
Rights
($) | | Number of Securities
Remaining
Available for Future
Issuance Under Equity
Compensation Plans
(excluding securities
reflected
in Column (a)) | | | | | (a) | | (b) | | (c) | | | (a) | | (b) | | (c) | | Equity compensation plans approved by security holders | | | 5,865,910 | (1) | | 20.3306 | (2) | | 18,786,400 | (3) | | | 5,195,991 | (1) | | 20.1042 | (2) | | 15,796,477 | (3) | Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Total | | | 5,865,910 | | | 20.3306 | | | 18,786,400 | | | | 5,195,991 | | | 20.1042 | | | 15,796,477 | |
| (1) | Of these shares, 3,912,4123,544,087 shares were subject to outstanding stock options and 1,953,4981,651,904 shares were subject to outstanding restricted stock units. This number does not include 511,068449,804 shares that were subject to then-outstanding, but unvested, restricted stock awards. The 1,953,4981,651,904 shares subject to outstanding restricted stock unit awards includes outstanding restricted stock unit awards subject to performance-based vesting conditions assuming that the “target” level of performance was attained. |
| (2) | This weighted-average exercise price does not reflect the 1,953,4981,651,904 shares that will be issued upon the vesting of outstanding restricted stock units. |
| (3) | Of these shares, (i) 15,350,42812,595,751 shares were available at February 3, 20181, 2020 for future issuance under stock options, SARs, restricted stock awards, stock units, performance share awards or performance units under the Company’s 2004 Equity Incentive Plan (the terms of which provide that shares issued in respect of any “full-value award” (which includes awards other than options and stock appreciation rights) will be counted as 3.54 shares for every 1 share actually issued in connection with the award), (ii) 2,940,4832,843,322 shares were available at February 3, 20181, 2020 for future issuance pursuant to the Company’s 2002 Employee Stock Purchase Plan and (iii) 495,489357,404 shares were available at February 3, 20181, 2020 for future issuance under restricted stock and restricted stock unit awards under the Company’s Director Plan. |
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information available to the Company as of the Record Date, May 4, 2018,April 28, 2020, with respect to shares of Common Stock held by (i) each director, including the nominees for election at the Annual Meeting, (ii) our Named Executive Officers (as defined under “Executive and Director Compensation—Compensation Discussion and Analysis” above), (iii) all of our directors, including our nominees for election at the Annual Meeting, and our executive officers as a group and (iv) each person believed by us to beneficially own more than 5% of our outstanding shares of Common Stock. | | | | Beneficial Ownership of
Common Stock | | | Beneficial Ownership of
Common Stock | | Name of Beneficial Owner(1) | | Number of
Shares | | | Percent of
Class(2) | | | Number of
Shares | | | Percent of
Class(2) | | Maurice Marciano(3) | | | 11,693,275 | | | | 14.4 | % | | | 11,665,743 | | | | 17.2 | % | Paul Marciano(4) | | | 12,695,470 | | | | 15.6 | % | | | 13,226,183 | | | | 19.5 | % | Victor Herrero(5) | | | 565,718 | | | | * | | | Carlos Alberini(5) | | | | 819,008 | | | | 1.2 | % | Gianluca Bolla(5) | | | 66,768 | | | | * | | | | 75,091 | | | | * | | Anthony Chidoni(5) | | | 184,290 | | | | * | | | | 190,824 | | | | * | | Joseph Gromek(5) | | | 61,391 | | | | * | | | Kay Isaacson-Leibowitz(5) | | | 50,369 | | | | * | | | Laurie Ann Goldman(5) | | | | 17,468 | | | | * | | Cynthia Livingston(5) | | | | 11,294 | | | | * | | Deborah Weinswig(5) | | | | 17,468 | | | | * | | Alex Yemenidjian(5) | | | 107,882 | | | | * | | | | 126,925 | | | | * | | Sandeep Reddy(5) | | | 154,133 | | | | * | | | All directors and executive officers as a group (9 persons)(6) | | | 25,579,296 | | | | 31.3 | % | | Kathryn Anderson(5) | | | | 78,260 | | | | * | | All directors and executive officers as a group (10 persons)(6) | | | | 26,228,264 | | | | 38.5 | % | BlackRock, Inc.(7) 55 East 52nd Street, New York, New York, 10055 | | | 7,609,354 | | | | 9.4 | % | | | 6,881,861 | | | | 10.2 | % | Dimensional Fund Advisors LP(8) Building One, 6300 Bee Cave Road, Austin, Texas, 78746 | | | 7,051,944 | | | | 8.7 | % | | | 5,543,285 | | | | 8.2 | % | FMR LLC(9) 245 Summer Street, Boston, Massachusetts, 02210 | | | 12,341,055 | | | | 15.2 | % | | | 9,796,792 | | | | 14.5 | % | State Street Corporation(10) State Street Financial Center, One Lincoln Street, Boston, Massachusetts, 02111 | | | 4,191,805 | | | | 5.2 | % | | The Vanguard Group(11) 100 Vanguard Boulevard, Malvern, Pennsylvania, 19355 | | | 5,746,155 | | | | 7.1 | % | | The Vanguard Group(10) 100 Vanguard Boulevard, Malvern, Pennsylvania, 19355 | | | | 4,461,842 | | | | 6.6 | % |
| (1) | Except as described below and subject to applicable community property laws and similar laws, each person listed above has sole voting and investment power with respect to such shares. This table is based upon information supplied by officers, directors and principal shareholders. Except as indicated above, the business address for each person is: c/o Guess?, Inc., 1444 South Alameda Street, Los Angeles, California 90021. |
| (2) | The number of shares outstanding used in calculating the percentages for each person includes shares that may be acquired by such person upon the exercise of options exercisable within 60 days of May 4, 2018April 28, 2020 but excludes shares underlying options held by any other person. The percent of beneficial ownership is based on 80,954,80467,644,248 shares of Common Stock outstanding on May 4, 2018.April 28, 2020. |
| (3) | Includes shares of Common Stock beneficially owned by Maurice Marciano as follows: 11,9368,294 shares held directly; 4,576,9774,598,087 shares held indirectly as sole trustee of the Maurice Marciano Trust; 103,801 shares held indirectly as a member of Next Step Capital LLC (with respect to which he has sole voting power over 11,400 shares and no voting power over the remainder); 554,940 shares held indirectly as a member of Next Step Capital II, LLC (with respect to which he has sole voting power over 277,470 shares and no voting power over the remainder); 70 shares held indirectly as sole trustee of the Maurice Marciano Gift Trust FBO Caroline Marciano; 2,000,000 shares held indirectly as a member of the MM CRUT, LLC; 1,500,000 shares |
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| held indirectly as a member of Carolem Capital, LLC (with respect to which he has sole voting power over 375,000 shares and no voting power over the remainder); 2,000,000 shares held |
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| indirectly as a member of Maurice Marciano Charitable Remainder Unitrust II; 264,384 shares held indirectly as trustee of G2 Trust; 136,201 shares held indirectly as trustee of the Exempt G2 Trust; 349,491 shares held indirectly as a member of Maurice Marciano Special Exempt Trust (with respect to which he has no voting power); 50,000 shares held indirectly as President of the Maurice Marciano Family Foundation; and 145,475100,475 shares that may be acquired upon the exercise of options exercisable within 60 days of May 4, 2018.April 28, 2020. Amounts include 2,000,000 shares pledged as security under revolving lines of credit as of May 4, 2018.April 28, 2020. To avoid double counting shares for purposes of this table, total holdings do not include the following amounts shown in the holdings of Paul Marciano in footnote (4) below: 170,666 shares held by G Financial Holdings LLC (with respect to which Maurice Marciano has sole voting power and no investment power); and 339,005 shares held by G Financial Holdings II, LLC (with respect to which Maurice Marciano has sole voting power and no investment power). |
| (4) | Includes shares of Common Stock beneficially owned by Paul Marciano as follows: no269,928 shares held directly (excluding 96,210155,751 restricted stock units subject to time-based vesting and 341,594106,707 restricted stock units and performance share awards subject to performance and time-based vesting restrictions); 9,276,2229,697,007 shares held indirectly as sole trustee of the Paul Marciano Trust; 234,500 shares held indirectly as president of the Paul Marciano Foundation; 1,481,700 shares held indirectly as a member of NRG Capital Holdings, LLC (with respect to which he has sole voting power over 370,425 shares and no voting power over the remainder); 170,666 shares held indirectly as member of G Financial Holdings, LLC (with respect to which he has no voting power); 339,005 shares held indirectly as a member of G Financial Holdings II, LLC (with respect to which he has no voting power); 105,977 shares held indirectly as trustee of Exempt Gift Trust under the Next Step Trust; 370,309 shares held indirectly as trustee of the Nonexempt Gift Trust under the Next Step Trust; 349,491 shares held indirectly as trustee of Paul Marciano Special Exempt Trust (with respect to which he has no voting power); and 367,600207,600 shares that may be acquired upon the exercise of options exercisable within 60 days of May 4, 2018.April 28, 2020. Amounts include 3,500,000 shares pledged as security under revolving lines of credit as of May 4, 2018.April 28, 2020. To avoid double counting shares for purposes of this table, total holdings do not include the following amounts shown in the holdings of Maurice Marciano in footnote (3) above: 92,401 shares held by Next Step Capital LLC (with respect to which he has sole voting power and no investment power); 277,470 shares held by Next Step Capital II LLC (with respect to which he has sole voting power and no investment power); 349,491 shares held by Maurice Marciano Special Exempt Trust (with respect to which he has sole voting power and no investment power); and 1,125,000 shares held by Carolem Capital, LLC (with respect to which he has sole voting power and no investment power). |
| (5) | Includes shares of Common Stock that may be acquired upon the exercise of options exercisable within 60 days of May 4, 2018,April 28, 2020, as follows: Victor Herrero, 300,000 sharesCarlos Alberini, 150,000 (Mr. Herrero’sAlberini’s amounts do not include an additional 224,981187,500 restricted stock units subject to time-based vesting and 335,085 restricted stock units and performance share awards subject to performance and time-based vesting restrictions); Gianluca Bolla, no shares (Mr. Bolla holds 11,936Bolla’s amounts do not include 8,294 restricted stock units subject to time-based vesting); Anthony Chidoni, no shares; Joseph Gromek,shares (Mr. Chidoni’s amounts include 50,000 shares pledged as security under a revolving line of credit); Laurie Ann Goldman, no shares; Kay Isaacson-Leibowitz,Cynthia Livingston, no shares; Deborah Weinswig, no shares; Alex Yemenidjian, no shares; and Sandeep Reddy, 70,044 shares (Mr. Reddy’s amounts do not include 74,635 performance share awards subject to performance and time-based vesting restrictions).Kathryn Anderson, no shares. |
| (6) | Includes: 883,119458,075 shares of Common Stock that may be acquired upon the exercise of options within 60 days of May 4, 2018.April 28, 2020. |
| (7) | With respect to information relating to BlackRock, Inc., we have relied solely on information supplied by such entity on a Schedule 13G/A filed with the SEC on January 25, 2018.February 10, 2020. According to the Schedule 13G/A, as of December 31, 2019, BlackRock, Inc. and its affiliates reported sole voting power with respect to 7,445,686 shares and sole investment power with respect to 7,609,3546,744,701 shares. |
| (8) | With respect to information relating to Dimensional Fund Advisors LP, we have relied solely on information supplied by such entity on a Schedule 13G filed with the SEC on February 9, 2018.12, 2020. According to the Schedule 13G/A, as of December 31, 2019, Dimensional Fund Advisors LP and its affiliates reported sole voting power with respect to 6,848,066 shares and sole investment power with respect to 7,051,9445,381,258 shares. |
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| (9) | With respect to information relating to FMR LLC, we have relied solely on information supplied by such entity on a Schedule 13G/A filed with the SEC on February 13, 2018.7, 2020. According to the Schedule 13G/A, as of December 31, 2019, FMR LLC and its affiliates reported sole voting power with respect to 1,331,069673,852 shares. The |
69
| Schedule 13G/A also reports that Abigail P. Johnson, a director, chairman and chief executive officer of FMR LLC, has beneficial ownership over all 9,796,792 shares, that FidelityLow-Priced Stock Fund has beneficial ownership over 3,948,666 of such shares and sole investment power with respect to 12,341,055that Fidelity Series Intrinsic Opportunities Fund has beneficial ownership over 4,841,500 of such shares. |
| (10) | With respect to information relating to State Street Corporation, we have relied solely on information supplied by such entity on a Schedule 13G filed with the SEC on February 14, 2018. State Street Corporation and its affiliates reported shared voting power with respect to 4,191,805 shares and shared investment power with respect to 4,191,805 shares. |
(11) | With respect to information relating to The Vanguard Group, we have relied solely on information supplied by such entity on a Schedule 13G filed with the SEC on February 9, 2018.12, 2020. According to the Schedule 13G/A, as of December 31, 2019, The Vanguard Group and its affiliates reported sole voting power with respect to 67,86045,141 shares, shared voting power with respect to 8,900 shares, sole investment power with respect to 5,675,8744,414,600 shares and shared investment power with respect to 70,28147,242 shares. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Under our written Related Person Transactions Policy, a related person transaction (as defined below) may be consummated or may continue only if the Audit Committee approves or ratifies the transaction in accordance with the guidelines set forth in the policy. The policy applies to: (i) any person who is, or at any time since the beginning of our last fiscal year was, a director or executive officer, (ii) any person who is known to be the owner of 5% or more of any class of our voting securities, (iii) any immediate family member, as defined in the policy, of any of the foregoing persons, and (iv) any entity in which any of the foregoing persons is an officer, general partner or otherwise controls such entity. “Related person transaction” is defined in the policy as a transaction, arrangement or relationship, or series of similar transactions, arrangements or relationships, in which (a) the Company was or is to be a party or a participant, (b) the amount involved exceeds or reasonably can be expected to exceed $120,000, and (c) any of the foregoing persons had or will have a direct or indirect material interest. All directors and executive officers are required under the Related Person Transactions Policy to notify the Company’s General Counsel of any potential or actual related person transaction as soon as they become aware of any such transaction. The General Counsel then presents any related person transactions to the Audit Committee for consideration. Among other relevant factors, the Audit Committee may consider the following: (i) the size and materiality of the transaction and the amount of consideration payable to a related person, (ii) the nature of the interest of the applicable related person, (iii) whether the transaction may involve a conflict of interest, (iv) whether the transaction involves the provision of goods or services to the Company that are readily available from unaffiliated third parties upon better terms, and (v) whether there are business reasons to enter into the transaction. Leases The Company leases warehouse and administrative facilities, including the Company’s corporate headquarters in Los Angeles, California, from entities affiliated with the trusts for the respective benefit of Paul Marciano, who is an executive and member of the Board, of the Company, and Maurice Marciano,non-executive Chairman Emeritus and member of the Board, and certain of their children (the “Marciano Trusts”), and certain of their affiliates. There were four of these leases in effect as of February 3, 20181, 2020 with expiration dates ranging fromin calendar years 2018 to 2020. The Company, through a wholly-owned Canadian subsidiary, leases warehouse2020 and administrative facilities in Montreal, Quebec from a partnership affiliated with the Marciano Trusts. During fiscal 2018, the Company exercised an option to extend the lease term for an additional one-year period ending in December 2018. All other terms of the existing lease remain in full force and effect.
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The Company, through a French subsidiary, leases a showroom and office space located in Paris, France from an entity that is owned in part by an affiliate of the Marciano Trusts. Due to excess capacity, the lease was amended to reduce the square footage by approximately 5,100 square feet to 16,000 square feet during fiscal 2018. The amendment also provided for a corresponding reduction in aggregate rent, common area maintenance charges and property tax expense due to the lower square footage. All other terms of the existing lease remain in full force and effect.
In January 2016, the Company sold an approximately 140,000 square foot parking lot located adjacent to the Company’s corporate headquarters to a partnership affiliated with the Marciano Trusts for a sales price of $7.5 million, which was subsequently collected during fiscal 2017. Concurrent with the sale, the Company entered into a lease agreement to lease back the parking lot from the purchaser. During fiscal 2016, the Company recognized a net gain of approximately $3.4 million in other income as a result of these transactions.2021.
Aggregate rent, common area maintenance charges and property tax expenselease costs recorded under these four related party leases for fiscal 2018,2020, fiscal 20172019 and fiscal 20162018 were $4.9$5.1 million, $5.0 million and $5.1$4.9 million, respectively. The Company believes that the terms of the related party leases and parking lot sale have not been significantly affected by the fact that the Company and the lessors are related. Employment of Family Member Nicolai Marciano, the son of Paul Marciano, is employed by the Company as Director of Specialty Marketing & Brand Partnerships. For fiscal 2020, Mr. Nicolai Marciano received $172,346 in base salary and a $50,000 annual incentive award (the net, after withholdings and deductions, amount of this annual incentive award for fiscal 2020 was settled in fully-vested shares of the Company’s common stock in April 2020). 70
Mr. Nicolai Marciano was entitled to participate during fiscal 2020 in the retirement, health and welfare benefit plans generally available to other salaried employees of the Company. In addition, the Company granted Mr. Nicolai Marciano (i) on March 29, 2019, 3,400 shares of restricted Company common stock and options to purchase 3,800 shares of Company common stock, in each case that are scheduled to vest, subject to his continued employment through the applicable vesting date, in equal 25% installments on January 5 of 2020, 2021, 2022 and 2023 and (ii) on June 10, 2019, options to purchase 15,000 shares of Company common stock that are scheduled to vest, subject to his continued employment, in equal annual installments over four years following the date of grant of the award. Aircraft Arrangements The Company periodically charters aircraft owned by MPM Financial, LLC (“MPM Financial”), an entityentities affiliated with the Marciano Trusts (the “Aircraft Entities”) through informal arrangements with MPM Financialthe Aircraft Entities and independent third partythird-party management companies contracted by MPM Financialthe Aircraft Entities to manage its aircraft. The total fees paid under these arrangements for fiscal 2018,2020, fiscal 20172019 and fiscal 20162018 were approximately $0.4 million, $1.0 million and $1.1 million, $0.9 million and $0.6 million, respectively. Other Transactions
During 2015, Georges Marciano, brother of Paul Marciano and Maurice Marciano, filed lawsuits against the Company in Canada and the U.S. related primarily to intellectual property rights in the Marciano name. Armand Marciano, also a brother of Paul Marciano and Maurice Marciano, was later added as a plaintiff to the U.S. lawsuit. In addition to the lawsuits, Georges Marciano opposed various of the Company’s applications for registration of its “Marciano” mark. In December 2015, the parties (including all the Marciano brothers) entered into a settlement agreement and a coexistence agreement whereby: (1) Georges Marciano and Armand Marciano agreed to drop all claims and actions against the Company; (2) the Company agreed to pay Georges Marciano and Armand Marciano a sum of $100,000 each (which amounts were substantially reimbursed by insurance); (3) the Company clarified the intellectual property rights of Georges Marciano and Armand Marciano in the use of their respective full names; and (4) the parties clarified the Company’s ownership and intellectual property rights in the name “Marciano.”
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OTHER MATTERS
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company’s executive officers and directors, and any beneficial owner of more than ten percent of a registered class of the Company’s equity securities, to file reports (Forms 3, 4 and 5) of stock ownership and changes in ownership with the SEC and the NYSE. Officers, directors and beneficial owners of more than ten percent of the Common Stock are required by SEC regulation to furnish the Company with copies of all such forms that they file.
Based solely on the Company’s review of the copies of Forms 3, 4 and 5 and the amendments thereto received by it for the year ended January 28, 2017, or written representations from certain reporting persons that no Forms 5 were required to be filed by those persons, the Company believes that during the year ended February 3, 2018, all filing requirements were complied with by its executive officers, directors and beneficial owners of more than ten percent of the Common Stock, except that director Gianluca Bolla had one late filing on Form 4 that did not timely report one transaction. On February 7, 2018, Mr. Bolla reported the disposition of 439 shares for tax purposes, which took place on January 30, 2018.
THE BOARD OF DIRECTORS May 17, 201811, 2020 7271
| | | | | IMPORTANT ANNUAL MEETING INFORMATION
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| | | A | | Proposals — The Board of Directors recommends a vote “FOR” each of the nominees listed in Proposal 1. |
| | | | | | | | | | | | | 1. Election of Directors:
| | For | | Withhold | | | | For | | Withhold | | | 01 - Maurice Marciano
| | ☐
| | ☐
| | 02 - Gianluca Bolla | | ☐ | | ☐ | | | (term expiring in 2021)
| | | | (term expiring in 2021) | | | | |
A Proposals — The Board of Directors recommends a vote “FOR” each of the nominees listed in Proposal 1. 1. Election of Directors: For Withhold For Withhold For Withhold 01—Carlos Alberini 02—Deborah Weinswig 03—Alex Yemenidjian (term expiring in 2023) (term expiring in 2023) (term expiring in 2023) The Board of Directors recommends a vote “FOR” Proposal 2. | | | | | | | | | For | | Against | | Abstain | | | | | 2. Advisory vote to approve the compensation of the named executive officers.
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The Board of Directors recommends a vote “FOR” Proposal 3. | | | | | | | | | For | | Against | | Abstain | | | | | 3. Ratification of the appointment of Ernst & Young LLP as the Company’s independent auditor for the fiscal year ending February 2, 2019.
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| The Board of Directors recommends a vote
“AGAINST” Proposal 4. |
| | | | | | | | | For | | Against | | Abstain | 4. Shareholder proposal regarding shareholder approval of future severance arrangements with senior executives.
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For Against Abstain For Against Abstain 2. Advisory vote to approve the compensation of the named 3. Ratification of the appointment of Ernst & Young LLP as the executive officers. Company’s independent auditor for the fiscal year ending January 30, 2021. In their discretion, the proxy holders are authorized to vote on such other matters that may properly come before this Annual Meeting or any adjournment or postponement thereof. If no direction is made, this proxy will be voted in accordance with the Board of Directors’ recommendations. | | | | | Change of Address— Please print new address below. | | Meeting AttendanceMark box to the right if you plan to attend the Annual Meeting. | | | | | | ☐ |
| | | C | | Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below |
B Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. | | | | | | | | | Date (mm/dd/yyyy) — Please print date below.
| | Signature 1 — Please keep signature within the box.
| | Signature 2 — Please keep signature within the box.
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02UM4C Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. 1UPX 039IKE
IF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION,The 2020 Annual Meeting of Shareholders of Guess?, Inc. will be held on June 12, 2020, at 9:00 a.m. Pacific virtually via live webcast at www.meetingcenter.io/210132657 To access the virtual meeting, you will need the15-digit control number that is printed in the shaded bar located on the reverse side of this form. The password for the meeting is GES2020. Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.envisionreports.com/ges qIF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
q Proxy — Guess?, Inc. + COMMON STOCK PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoint(s) Sandeep ReddyKathryn Anderson and Jason T. Miller, or each of them acting alone, as proxies with full power of substitution, and hereby authorizes each of them to represent and to vote, as designated on the reverse side hereof, all shares of Common Stock of Guess?, Inc. (the “Company”) held of record by the undersigned on May 4, 2018April 28, 2020 at the Annual Meeting of Shareholders to be held on June 19, 201812, 2020 at 9:00 a.m. (PDT), local time, or any adjournments or postponements thereof, virtually via live audio webcast available at the Beverly Hills Hotel, 9641 Sunset Boulevard, Beverly Hills, CA 90210,www.meetingcenter.io/210132657, and hereby revoke(s) any proxies heretofore given. UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE NOMINEES FOR DIRECTOR, FOR THE ADVISORY RESOLUTION APPROVING THE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS, FOR THE RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT AUDITOR AGAINST THE SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER APPROVAL OF FUTURE SEVERANCE ARRANGEMENTS WITH SENIOR EXECUTIVES AND, IN THE DISCRETION OF THE PROXY HOLDERS, ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING. This proxy is revocable and the undersigned may revoke it at any time prior to its exercise. Attendance of the undersigned at the above meeting or any adjourned or postponed session thereof will not be deemed to revoke this proxy unless the undersigned votes said shares during such meeting in person. accordance with the procedures set forth with respect thereto. This proxy will be governed by and construed in accordance with the laws of the State of Delaware and applicable Federal Securities laws. (Continued (Continued and to be voted on reverse side.) CNon-Voting Items Change of Address — Please print new address below. Comments — Please print your comments below.
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