UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) OF THE SECURITIES
Exchange Act of 1934 (AMENDMENT NO.(Amendment No. )
Filed by the Registrant þx
Filed by a Party other than the Registrant o¨
Check the appropriate box:
¨ | Preliminary Proxy Statement |
¨ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
x | Definitive Proxy Statement |
¨ | Definitive Additional Materials |
¨ | Soliciting Material Pursuant to Rule 14a-12 |
REVLON, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, If Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
No fee required. |
Fee computed on table below per Exchange ActRules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which transaction applies: |
(2) | Aggregate number of securities to which transaction applies: |
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange ActRule 0-11: |
(4) | Proposed maximum aggregate value of transaction: |
(5) | Total fee paid: |
Fee paid previously with preliminary materials. |
Check box if any part of the fee is offset as provided by Exchange ActRule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
(1) | Amount Previously Paid: |
(2) | Form, Schedule or Registration Statement No.: |
(3) | Filing Party: |
(4) | Date Filed: |
237 PARK AVENUE
NEW YORK, NY 10017
April 19, 2011
Dear Stockholders:
You are cordially invited to attend the 20112012 Annual Meeting of Stockholders of Revlon, Inc., which will be held at 10:00 a.m., Eastern Time, on Thursday, June 2, 2011,7, 2012, at Revlon’s Research Center at 2121 Route 27, Edison, NJ 08818. The matters to be acted upon at the meeting are described in the accompanying Notice of Annual Meeting of Stockholders and Proxy Statement. Please also see the accompanying Notice of Annual Meeting of Stockholders and Proxy Statement for important information that you will need in order to pre-register for admission to the meeting, if you plan to attend in person.
While stockholders may exercise their right to vote their shares in person, we recognize that many stockholders may not be able to attend the 20112012 Annual Meeting. In accordance with rules adopted by the U.S. Securities and Exchange Commission, we are mailing to many of our stockholders a Notice of Internet Availability of Proxy Materials (instead of a paper copy of the Proxy Statement and our 20102011 Annual Report) which contains instructions on how stockholders can access the proxy materials over the Internet and vote electronically. The Notice of Internet Availability of Proxy Materials also contains instructions on how stockholders can receive a paper copy of our proxy materials, including the Proxy Statement, the 20102011 Annual Report and a form of proxy card. Our proxy materials are being furnished to stockholders on or about April 19, 2011.
Whether or not you plan to attend the 20112012 Annual Meeting, we encourage you to vote your shares, regardless of the number of shares you hold, by utilizing the voting options available to you as described in the Notice of Internet Availability of Proxy Materials and our Proxy Statement. This will not restrict your right to attend the 20112012 Annual Meeting and vote your shares in person, should you wish to change your prior vote.
Thank you.
Sincerely yours,
Alan T. Ennis
President and Chief Executive Officer
237 PARK AVENUE
NEW YORK, NY 10017
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Revlon, Inc.
The 20112012 Annual Meeting of Stockholders of Revlon, Inc., a Delaware corporation (the “Company”), will be held at 10:00 a.m., Eastern Time, on Thursday, June 2, 2011,7, 2012, at Revlon’s Research Center at 2121 Route 27, Edison, NJ 08818. The following proposals will be voted on at the 20112012 Annual Meeting:
1. the election of the following persons as members of the Company’s Board of Directors to serve until the next Annual Meeting and until such directors’ successors are elected and shall have been qualified: Ronald O. Perelman, Alan S. Bernikow, Paul J. Bohan, Viet D. Dinh, Alan T. Ennis, Meyer Feldberg, David L. Kennedy, Debra L. Lee, Tamara Mellon, Richard J. Santagati, Barry F. Schwartz and Kathi P. Seifert;
2. the ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2011;
3. the non-binding, advisory vote of stockholders on the Company’s executive compensation, as disclosed pursuant to Item 402 ofRegulation S-K, including as disclosed in the “Compensation Discussion and Analysis,” compensation tables and accompanying narrative set forth in this Proxy Statement(“say-on-pay”);
A Proxy Statement describing the matters to be considered at the 20112012 Annual Meeting accompanies this notice. Only stockholders of record at 5:00 p.m., Eastern Time, on April 8, 201113, 2012 are entitled to notice of, and to vote at, the 20112012 Annual Meeting and at any adjournments thereof. For at least ten days prior to the 20112012 Annual Meeting, a list of stockholders entitled to vote at the 20112012 Annual Meeting will be available for inspection during normal business hours at the offices of the Company’s Secretary at 237 Park Avenue, 14th Floor, New York, NY 10017, and such list also will be available at the 20112012 Annual Meeting.
Important Notice Regarding the Availability of Proxy Materials for the June 2, 20117, 2012 Annual
Stockholders’ Meeting:
We are delivering our Proxy Statement and 20102011 Annual Report under U.S. Securities and Exchange Commission rules that require companies to make proxy materials available to their stockholders over the Internet and to furnish notice of Internet access to such materials. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials to all of our stockholders (stockholders who have a request for paper copies on file with our transfer agent or their broker will receive paper copies of our proxy materials in the mail). A paper copy of our proxy materials may be requested through one of the methods described in the Notice of Internet Availability of Proxy Materials. Our Proxy Statement, including the Notice of Annual Meeting of Stockholders, and our 20102011 Annual Report to Stockholders are available atwww.proxyvote.com (where stockholders may also vote their shares, over the Internet) and atwww.revloninc.com.
Whether or not you plan to attend the 20112012 Annual Meeting, your vote is important. Please promptly submit your proxy by Internet, telephone or mail by following the instructions found on your Notice of Internet Availability of Proxy Materials or proxy card. Your proxy can be withdrawn by you at any time before it is voted at the 20112012 Annual Meeting.
If you plan to attend the 20112012 Annual Meeting in person, you should check the appropriate box on your proxy card (or indicate that you will attend when prompted by electronic voting means which you may access) indicating that you intend to do so. You will need to presentvalid picture identification, such as a driver’s license or passport, in order to be admitted to the meeting. If your shares are held other than as a stockholder of record (such as
record date, such as an original of a legal proxy from your bank or broker (“Requests for Admission” will not be accepted), your brokerage account statement demonstrating that you held Revlon, Inc. Class A Common Stock, Class B Common Stock or Series A Preferred Stock (“voting capital stock”) in your account on the April 8, 201113, 2012 record date, or, if you did not already return it to your bank or broker, an original voting instruction form issued by your bank or broker, demonstrating that you held Revlon, Inc. voting capital stock in your account on the April 8, 201113, 2012 record date.Please see our Proxy Statement for information on how to pre-register for the meeting, should you wish to attend.
As previously disclosed, in September 2008, the Company completed a1-for-10 reverse stock split of its Class A and Class B Common Stock (the “Reverse Stock Split”) pursuant to which each ten (10) shares of Revlon, Inc. Class A and Class B Common Stock issued and outstanding immediately prior to 11:59 p.m. on September 15, 2008 were automatically combined into one (1) share of Class A Common Stock and Class B Common Stock, respectively, subject to the elimination of fractional shares. The Company has determined that stockholders who have not yet surrendered their shares to the Company’s transfer agent for exchange in connection with the Reverse Stock Split will be considered stockholders of record and will be permitted to receive these proxy materials, vote their shares (after giving effect to the1-for-10 Reverse Stock Split) and attend the 20112012 Annual Meeting.
In order to expedite the admission registration process, we encourage stockholders to pre-register in accordance with the pre-registration procedures set forth in our Proxy Statement.
Thank you.
By Order of the Board of Directors
Michael T. Sheehan
Senior Vice President, Deputy General Counsel
and Secretary
April 19, 2011
PLEASE PROMPTLY SUBMIT YOUR VOTE BY INTERNET, TELEPHONE OR MAIL BY FOLLOWING THE INSTRUCTIONS FOUND ON YOUR NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS, VOTING INSTRUCTION FORM OR PROXY CARD. THIS WILL ENSURE THAT YOUR SHARES ARE VOTED IN ACCORDANCE WITH YOUR WISHES.
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PROPOSAL NO. 2 — RATIFICATION OF AUDIT COMMITTEE’S SELECTION OF KPMG LLP | ||||
Vote Required and Board of Directors’ Recommendation (Proposal No. 2) | 60 | |||
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Annex A-1 | ||||
Annex B-1 |
This summary highlights information contained elsewhere in this proxy statement. The following description is only a summary; for more information, you should carefully read and consider the entire proxy statement, as well as the Company’s 2011 Annual Report, before voting on the matters presented in this proxy statement.
2012 Annual Meeting of Stockholders | ||
Time & Date | 10:00 a.m., June 7, 2012 | |
Place | Revlon Research Center 2121 Route 27 Edison, NJ 08818 | |
Record Date | April 13, 2012 | |
Voting | Each share of the Company’s Class A Common Stock and Series A Preferred Stock is entitled to one vote, and each share of the Company’s Class B Common Stock is entitled to ten votes. | |
Admission | Stockholders of record on the Record Date may attend the 2012 Annual Meeting upon presentation of appropriate admission materials; pre-registration is encouraged; see the “Questions and Answers About the Annual Meeting and Voting” section of this proxy statement for more information. | |
Meeting Agenda | 1. Election of Directors. 2. Ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2012. 3. Transact such other business that may properly be brought before the meeting. | |
Voting Matters | ||
Item | Board Vote Recommendation | |
1. Election of Directors | For each Director nominee. | |
2. Ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2012 | For. |
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Board Nominees
The following table provides summary information about each Director nominee. Each Director nominee is a current standing Director of the Company (other than Mr. Dinh, who is a new nominee). Each Director is elected annually by a plurality of votes cast.
Name | Revlon Director Since | Independent | Committee Memberships | Committee Chairman | ||||
Ronald O. Perelman (Chairman) | 1992 | |||||||
Alan S. Bernikow | 2003 | X | Audit; Compensation | Audit; Compensation | ||||
Paul J. Bohan | 2004 | X | Audit; Nominating & Corporate | |||||
Viet D. Dinh | — | X | ||||||
Alan T. Ennis | 2009 | |||||||
Meyer Feldberg | 1997 | X | Audit; Nominating & Corporate | Nominating & Corporate Governance | ||||
David L. Kennedy | 2006 | |||||||
Debra L. Lee | 2006 | X | Nominating & Corporate Governance | |||||
Tamara Mellon | 2008 | X | ||||||
Richard J. Santagati | 2009 | X | Compensation; Nominating & Corporate | |||||
Barry F. Schwartz | 2007 | Compensation | ||||||
Kathi P. Seifert | 2006 | X | Audit; Compensation |
Auditors
As a matter of good corporate practice, the Company is asking its stockholders to ratify the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2012. Set forth below is a summary of information with respect to KPMG LLP’s fees for services provided in 2011 and 2010 (dollars are in millions).
Types of Fees | 2011 | 2010 | ||||||
Audit Fees | $ | 3.8 | $ | 3.6 | ||||
Audit-Related Fees | 0.2 | 0.2 | ||||||
Tax Fees | 0.2 | 0.2 | ||||||
All Other Fees | — | — | ||||||
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TOTAL FEES | $ | 4.2 | $ | 4.0 | ||||
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Q. | |
Why am I receiving these proxy materials? | |
A. | Our Board of Directors is providing this Proxy Statement and other materials to you in connection with the Company’s |
Q. | Why did I receive a notice regarding the Internet availability of the proxy materials instead of a paper copy of the proxy materials? |
In accordance with rules and regulations adopted by the U.S. Securities and Exchange Commission, instead of mailing a printed copy of our proxy materials to all stockholders entitled to vote at our 20112012 Annual Meeting, we are making the proxy materials and our 20102011 Annual Report available to our stockholders electronically via the Internet. On or about April 19, 2011,24, 2012, we are sending to our stockholders a Notice of Internet Availability of Proxy Materials (the “Internet Notice”). The Internet Notice contains instructions on how stockholders may access and review our proxy materials and our 20102011 Annual Report over the Internet and vote electronically, as well as instructions on how stockholders can receive a paper copy of our proxy materials, including the 20112012 Proxy Statement, the 20102011 Annual Report and a form of proxy card. Otherwise, you will not receive a printed copy of the proxy materials (unless you already had a request for paper copies on file with our transfer agent or your broker). Instead, the Internet Notice will instruct you as to how you may access and review the proxy materials and submit your vote via the Internet. If you would like to receive a printed copy of the proxy materials, please follow the instructions included in the Internet Notice for requesting printed materials.
Important Notice Regarding the Availability of Proxy Materials for the June 2, 20117, 2012 Annual
Stockholders’ Meeting:
Our 20112012 Proxy Statement, including the Notice of Annual Meeting of Stockholders, and 20102011 Annual Report to Stockholders are available atwww.proxyvote.com (where stockholders may also vote their shares, via the Internet) and atwww.revloninc.com..
Q. | |
How can I request paper copies of proxy materials? | |
A. | If you only received the Internet Notice, you will not receive a printed copy of the proxy materials unless you request them. There is no charge imposed by the Company for requesting a copy. To request paper copies, stockholders can (i) go towww.proxyvote.com and follow the instructions posted for requesting materials, (ii) call1-800-579-1639or (iii) send an email tosendmaterial@proxyvote.com. If you request materials by email, send a blank email with your Control Number(s) (located in the Internet Notice) in the subject line.To facilitate timely delivery of paper copies of requested materials, please make your paper copy request no later than May |
Q. | When and where is the |
A. | The |
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Q. | |
What is the purpose of the | |
A. | At the |
the election of the following persons as members of the Company’s Board of Directors to serve until the next Annual Meeting and until such directors’ successors are elected and shall have been qualified: Ronald O. Perelman, Alan S. Bernikow, Paul J. Bohan, Viet D. Dinh, Alan T. Ennis, Meyer Feldberg, David L. Kennedy, Debra L. Lee, Tamara Mellon, Richard J. Santagati, Barry F. Schwartz and Kathi P. Seifert (if any nominee is unable or declines unexpectedly to stand for election as a director at the 2012 Annual Meeting, the Board of Directors may by resolution provide for a lesser number of directors or designate substitute nominees and proxies will be voted for any such substitute nominee);
the ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2012; and
the transaction of such other business as may properly come before the 2012 Annual Meeting.
Q. | ||
What are the voting recommendations of the Board? | |
A. | The Board recommends the following votes: |
FOR each of the director nominees; and
FORthe ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2012.
Q. | ||
What is the difference between holding shares as a stockholder of record and as a beneficial owner? | |
A. | Many holders of the Company’s voting capital stock hold such shares through a broker or other nominee (i.e., a beneficial owner) rather than directly in their own name (i.e., a stockholder of record). As summarized below, there are some distinctions between shares held of record and those owned beneficially. |
• | Stockholder of | ||
• | Reverse Stock |
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stockholders of record and will be permitted to receive these proxy materials, vote their shares (after giving effect to the1-for-10 Reverse Stock Split) and attend the |
• | Beneficial |
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Q. | |
How do I vote? | |
A. | You may vote using one of the following methods: |
Internet.Internet. For all holders of our voting capital stock (whether a stockholder of record or a beneficial owner), to vote through the Internet, log on to the Internet and go towww.proxyvote.com and follow the steps on the secure website (have your Internet Notice or your proxy card available as you will need to reference your assigned Control Number(s)). You may vote on the Internet up until 11:59 p.m. Eastern Time on June 1, 2010,6, 2012, which is the dateday before the June 2, 20117, 2012 Annual Meeting. If you vote by the Internet, you need not return your proxy card (if you received one), unless you wish to change your Internet vote.
Telephone.Telephone. You may vote by telephone by calling the toll-free number on your proxy card up until 11:59 p.m., Eastern Time, on June 1, 2010,6, 2012, which is the dateday before the June 2, 20117, 2012 Annual Meeting, and following the pre-recorded instructions (have your Internet Notice or your proxy card available when you call as you will need to reference your assigned Control Number(s)). If you vote by telephone, you should not return your proxy card (if you received one), unless you wish to change your Internettelephone vote.
Mail.Mail. If you received your proxy materials by mail, due to having a request for paper copies on file with our transfer agent or your broker, you may vote by mail by appropriately marking your proxy card, dating and signing it, and returning it in the postage-prepaid envelope provided, or to Vote Processing (Revlon),c/o Broadridge, 51 Mercedes Way, Edgewood, NJ 11717, for receipt prior to the closing of the voting polls for the June 2, 20117, 2012 Annual Meeting.
In Person.Person. You may vote your shares in person by attending the 20112012 Annual Meeting and submitting a valid proxy at the 20112012 Annual Meeting. If you are a “registered owner” or “record holder” (i.e., you are listed as a stockholder on the books and records of our transfer agent), you may vote in person by submitting your previously furnished proxy or casting a voting capital stock ballot furnished by the Company at the Meeting prior to the closing of the polls; if you are a “beneficial owner” (i.e., your shares are held by a nominee, such as a bank or broker or in “street name”), you may not vote your shares in person at the 20112012 Annual Meeting unless you obtain and present to the Company an original (copies will not be accepted) legal proxy from your bank or broker authorizing you to vote the shares (“Requests for Admission” will not be accepted).
Voting, Generally.Generally. All shares that have been voted properly by an unrevoked proxy will be voted at the 20112012 Annual Meeting in accordance with your instructions. In relation to how your proxy will be voted, see “How will my proxy be voted?” below.
If you are a “beneficial owner” because your brokerage firm, bank, broker-dealer or other similar organization is the holder of record of your shares (i.e., your shares are held in “street name”),you will receive instructions on how to vote from your bank, broker or other record holder. You must follow these instructions in order for your shares to be voted. You should instruct your nominee on how to vote your shares. Your broker is required to vote those shares in accordance with your instructions. If you do not give instructions to your broker, the broker may vote your shares only with respect to Proposal No. 2 (the ratification of the appointmentAudit Committee’s selection of the Company’s independent registered public accounting firm), which is considered a “routine” matter, and not with respect to Proposal Nos. 1, 3 and 4.
Q. | |
Who can vote? | |
A. | Only stockholders of record of Revlon, Inc. Class A and Class B Common Stock and Revlon, Inc. Series A Preferred Stock at 5:00 p.m., Eastern Time, on April |
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those who have been granted and present an original, signed, valid legal proxy in appropriate form from a holder of record of Revlon, Inc. Class A or Class B Common Stock or Revlon, Inc. Series A Preferred Stock as of 5:00 p.m., Eastern Time, on April |
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As noted above, the Company has determined that stockholders who have not yet surrendered their old shares of Class A Common Stock to the Company’s transfer agent for exchange in connection with the Reverse Stock Split will be considered stockholders of record and will be permitted to receive these proxy materials, vote their shares (after giving effect to the1-for-10 Reverse Stock Split) and attend the 20112012 Annual Meeting.
Q. | |
How will my proxy be voted? | |
A. | Your proxy, when properly submitted to us, and not revoked, will be voted in accordance with your instructions. If you sign and return your proxy card without indicating how you would like your shares to be voted, the persons designated by the Company as proxies will vote in accordance with the recommendations of the Board of Directors on Proposal No. 1 (the election of directors) |
Although we are not aware of any other matter that may be properly presented at the 20112012 Annual Meeting, if any other matter is properly presented, the persons designated by the Company as proxies may vote on such matters in their discretion.
Q. | |
Can I change or revoke my vote? | |
A. | Yes. If you are a stockholder of record, you can change or revoke your vote at any time before it is voted at the |
executing and delivering a proxy bearing a later date, which must be received by the Company’s Secretary at 237 Park Avenue, 14th Floor, New York, NY 10017, Attention: Michael T. Sheehan, before the original proxy is voted at the 2012 Annual Meeting;
filing a written revocation or written notice of change, as the case may be, which must be received by the Company’s Secretary at 237 Park Avenue, 14th Floor, New York, NY 10017, Attention: Michael T. Sheehan, before the original proxy is voted at the 2012 Annual Meeting; or
attending the 2012 Annual Meeting and voting in person.
If you are a beneficial owner, please follow the voting instructions sent to you by your broker, trustee or nominee to change or revoke your vote.
To revoke a vote previously submitted electronically through the Internet or by telephone, you may simply vote again at a later date, using the same procedures, in which case the later submitted vote will be recorded and the earlier vote revoked.
Q. | |
What if I am a participant in the Revlon 401(k) Plan? | |
A. | This Proxy Statement is being furnished to you if Revlon, Inc. Class A Common Stock is allocated to your account within the Revlon Employees’ Savings, Investment and Profit Sharing Plan (the “401(k) Plan”). The trustee of the 401(k) Plan, as the record holder of the Company’s shares held in the 401(k) Plan, will vote the |
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shares allocated to your account under the 401(k) Plan in accordance with your instructions. If the trustee of the 401(k) Plan does not otherwise receive voting instructions for shares allocated to your 401(k) Plan Account, the trustee, in accordance with the 401(k) Plan trust agreement, will vote any such shares in the same proportion as it votes those shares allocated to 401(k) Plan participants’ accounts for which voting instructions were received by the trustee.401(k) Plan participants must submit their voting instructions to the trustee of our 401(k) Plan in accordance with the instructions included with the proxy card orInternet Notice so that they are received by 11:59 p.m. Eastern Time on May |
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trustee time to receive such voting instructions and vote on behalf of participants in the 401(k) Plan.Voting instructions received from 401(k) Plan participants after this deadline, under any method, will not be considered timely and will be voted by the trustee at the |
Q. | |
Who can attend the | |
A. | Anyone who was a stockholder of the Company as of 5:00 p.m., Eastern Time, on April |
To attend the 20112012 Annual Meeting, please follow these instructions:
If you are a stockholder of record on the April 13, 2012 record date, check the appropriate box on the proxy card (or indicate that you will attend when prompted by electronic voting means which you may access) indicating that you plan on attending the 2012 Annual Meeting, and please present at the meeting a valid picture identification, such as a driver’s license or passport.
If you are a stockholder whose shares are held in a brokerage account or by another nominee, please present at the meeting valid picture identification, such as a driver’s license or passport, as well as original proof of ownership of shares of Revlon, Inc. voting capital stock as of 5:00 p.m., Eastern Time, on the April 13, 2012 record date, in order to be admitted to the 2012 Annual Meeting. As noted, you will need to present original evidence of stock ownership, such as an original of a legal proxy from your bank or broker (“Requests for Admission” will not be accepted), your brokerage account statement, demonstrating that you held Revlon, Inc. voting capital stock in your account as of 5:00 p.m., Eastern Time, on the April 13, 2012 record date, or, if you did not already return it to your bank or broker, an original voting instruction form issued by your bank or broker, demonstrating that you held Revlon, Inc. voting capital stock in your account as of 5:00 p.m., Eastern Time, on the April 13, 2012 record date.
In order to ensure the safety and security of our meeting attendees, packages and bags may be inspected and may have to be checked and, in some cases, may not be permitted. We thank you in advance for your cooperation with these security measures.
Q. | |
Should I pre-register for the | |
A. | In order to expedite the admission registration process required for you to enter the |
Q. | Can I bring a guest to the |
A. | Yes.If you plan to bring a guest to the |
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present valid picture identification to gain access to the |
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Q. | |
Can I still attend the | |
A. | Yes. Attending the |
Q. | What shares are covered by my proxy card or electronic voting form? |
A. | The shares covered by your proxy card or electronic voting form represent all of the shares of the Company’s voting capital stock that you own in the account referenced on the proxy card. Any shares that may be held for your account by the 401(k) Plan or another account will be represented on a separate proxy card and/or by a separate Control Number. |
Q. | What does it mean if I get more than one proxy card? |
A. | It means you have multiple accounts at our transfer agentand/or with banks or stockbrokers. Please vote all of your shares. |
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Annual Meeting of Stockholders
to be held on June 2, 20117, 2012
This Proxy Statement is being furnished on or about April 19, 201124, 2012 by and on behalf of the Board of Directors (the “Board of Directors” or the “Board”) of Revlon, Inc. (the “Company” or “Revlon”) in connection with the solicitation of proxies to be voted at the 20112012 Annual Meeting of Stockholders (the “2011“2012 Annual Meeting”) to be held at 10:00 a.m., Eastern Time, on Thursday, June 2, 2011,7, 2012, at Revlon’s Research Center at 2121 Route 27, Edison, NJ 08818, and at any adjournments thereof. The 20102011 Annual Report furnished with our Proxy Statement does not form any part of the material for the solicitation of proxies.
Pursuant to the rules and regulations adopted by the U.S. Securities and Exchange Commission (the “SEC”), we are required to provide our stockholders with access to our proxy materials over the Internet, rather than only in paper form.Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Internet Notice”), rather than a printed copy of the proxy materials, to our stockholders of record as of April 8, 2011.13, 2012. You will not receive a printed copy of the proxy materials unless you already had a request for paper copies on file with our transfer agent or your broker. If you want to receive paper copies of the proxy materials, you must request them through one of the methods identified elsewhere in this Proxy Statement or in the Internet Notice.There is no charge imposed by the Company for requesting paper copies. Our proxy materials, including the Internet Notice, are being made available to stockholders entitled to vote at the 20112012 Annual Meeting on or about April 19, 2011.
At the 20112012 Annual Meeting, the Company’s stockholders will be asked to: (1) elect the following persons (all of whom currently are directors of the Company) as directors of the Company until the Company’s next annual stockholders’ meeting and until each such director’s successor is duly elected and has been qualified: Ronald O. Perelman, Alan S. Bernikow, Paul J. Bohan, Viet D. Dinh, Alan T. Ennis, Meyer Feldberg, David L. Kennedy, Debra L. Lee, Tamara Mellon, Richard J. Santagati, Barry F. Schwartz and Kathi P. Seifert; (2) ratify the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2011;2012; and (3) provide their non-binding, advisory approval of the Company’s executive compensation, as disclosed pursuant to Item 402 ofRegulation S-K, including as disclosed in the “Compensation Discussion and Analysis,” compensation tables and accompanying narrative set forth in this Proxy Statement(“say-on-pay”); (4) consider and submit their non-binding, advisory vote on the future frequency of the“say-on-pay” vote on executive compensation(“say-on-frequency”); and (5) take such other action as may properly come before the 20112012 Annual Meeting or any adjournments thereof.
The Company’s principal executive offices are located at 237 Park Avenue, New York, NY 10017, and its main telephone number is(212) 527-4000.
In order to be admitted to the 20112012 Annual Meeting20112012 Annual Meeting in person, you should check the appropriate box on your proxy card (or indicate that you will attend when prompted by electronic voting means which you may access) indicating that you intend to attend in person and you will need to presentvalid picture identification, such as a driver’s license or passport, as well as originalproof of ownershipof shares of Revlon, Inc. Class A Common Stock, Class B Common Stock or Series A Preferred Stock as of 5:00 p.m., Eastern Time, on the April 8, 201113, 2012 record date. If your shares are held other than as a stockholder of record (such as beneficially through a brokerage, bank or other nominee account), you will need to present original documents (copies will not be accepted) to evidence your stock ownership as of 5:00 p.m., Eastern Time, on the April 8, 201113, 2012 record date, such as an original of a legal proxy from your bank or broker (“Requests for Admission” will not be accepted) or your brokerage account statement demonstrating that you held Revlon, Inc. voting capital stock in your account as of 5:00 p.m., Eastern Time, on the April 8, 201113, 2012 record date, or, if you did not already return it to your bank or broker, an original voting instruction form issued by your bank or broker, demonstrating that you held Revlon, Inc. voting capital stock in your account as of 5:00 p.m., Eastern Time, on the April 8, 201113, 2012 record date.
Connerty, Senior Corporate Legal Assistant, Corporate and Budgeting, at(212) 527-5528, or Liz Polido, Corporate Legal Assistant, at(212) 527-5227, Mondays Monday through FridaysFriday from 9:00 a.m. through 5:00 p.m., Eastern Time, up until 10:00 a.m., Eastern Time, on Thursday,Wednesday, June 2, 20106, 2012 (the dateday before the 20112012 Annual Meeting). Stockholders pre-registering by phone will be admitted to the meeting by presenting valid picture identification and, if your shares are held in a brokerage account or by another nominee, original evidence of your stock ownership as of the April 8, 201113, 2012 record date. Directions to the address for the 20112012 Annual Meeting are available on various Internet travel sites, or you may seek assistance from any of the above individuals when pre-registering.
In order to ensure the safety and security of our annual meetingAnnual Meeting attendees, packages and bags may be inspected and may have to be checked and, in some cases, may not be permitted. We thank you in advance for your cooperation with these security measures.
All proxies properly submitted to the Company, unless such proxies are properly revoked before they are voted at the Additionally, pursuant to the Company’s By-laws, in order for business to be properly brought before the The submission of a signed or validly submitted electronic proxy will not affect a stockholder’s right to change 20112012 Annual Meeting, will be voted on all matters presented at the 20112012 Annual Meeting in accordance with the instructions given by the person executing (or electronically submitting) the proxy or, in the absence of instructions, will be voted (1) FORthe election to the Board of Directors of each of the 1112 nominees identified in this Proxy Statement (all of whom currently are directors of the Company);Statement; and (2) FORthe ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2011; (3) FORthe non-binding, advisory approval of the Company’s executive compensation, as disclosed pursuant to Item 402 ofRegulation S-K, including as disclosed in the “Compensation Discussion and Analysis,” compensation tables and accompanying narrative set forth in this Proxy Statement; and (4) for the non-binding, advisory recommendation of conducting future non-binding, advisory votes on executive compensation everyTHREE (3) YEARS(see2012 (see below for discussion of broker non-votes). The Company has no knowledge of any other matters to be brought before the meeting. The deadline for receipt by the Company of stockholder proposals for inclusion in the proxy materials for presentation at the 20112012 Annual Meeting was December 22, 2010.21, 2011. The Company did not receive any proposals required to be included in these proxy materials.20112012 Annual Meeting (other than stockholder proposals included in the proxy statement pursuant toRule 14a-8 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and business specified in this Proxy Statement), notice of such business must have been received by the Company between March 5, 20114, 2012 and April 4, 20113, 2012 (and not subsequently withdrawn) and such notice must have included, among other things: (i) information regarding the proposed business to be brought before such meeting; (ii) the identity of the stockholder proposing the business; and (iii) the class of the Company’s shares which are owned beneficially or of record by such stockholder. The Company did not receive notification of any such matters. If any other matters are properly presented before the 20112012 Annual Meeting for action, however, in the absence of other instructions, it is intended that the persons named by the Company and acting as proxies will vote in accordance with their discretion on such matters.theirhis, her or its vote, attendand/or vote in person at the 20112012 Annual Meeting. Stockholders who execute a proxy or validly submit an electronic vote may revoke it at any time before it is voted at the 20112012 Annual Meeting by: (i) filing a written revocation or written notice of change, as the case may be, which must be received by the Company’s Secretary at 237 Park Avenue, 14th Floor, New York, NY 10017, Attention: Michael T. Sheehan, before the original proxy is voted at the 20112012 Annual Meeting; (ii) executing and delivering a proxy bearing a later date, which must be received by the Company’s Secretary at 237 Park Avenue, 14th Floor, New York, NY 10017, Attention: Michael T. Sheehan, before the original proxy is voted at the 20112012 Annual Meeting; or (iii) attending the 20112012 Annual Meeting and voting in person. To revoke a proxy previously submitted electronically through the Internet or by telephone, you may simply vote again at a later date, using the same procedures, in which case the later submitted vote will be recorded and the earlier vote revoked.2
Only holders of record of shares of the Company’s Class A common stock, par value $0.01 per share (the “Class A Common Stock”), Class B common stock, par value $0.01 per share (the “Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”), and Series A Preferred Stock, par value $0.01 per share (the “Preferred Stock” and, together with the Common Stock, the “Voting Capital Stock”), at 5:00 p.m., Eastern Time, on April 8, 201113, 2012 (the “Record Date”) will be entitled to notice of and to vote at the 20112012 Annual Meeting or any adjournments thereof. On the Record Date, there were issued and outstanding: (i) 49,050,62849,224,583 shares of the Company’s Class A Common Stock, each of which is entitled to one vote, (ii) 3,125,000 shares of the Company’s Class B Common Stock, each of which is entitled to 10 votes, and (iii) 9,336,905 shares of the Company’s Preferred Stock, each of which is entitled to one vote. Of that Voting Capital Stock, Mr. Ronald O. Perelman, Chairman of the Board of Directors, directly and indirectly through MacAndrews & Forbes Holdings Inc., of which Mr. Perelman is the sole stockholder (together with certain of its affiliates (other than the Company or its subsidiaries), “MacAndrews & Forbes”), beneficially owned approximately 77% of the combined voting power of the outstanding shares of the Company’s Voting Capital Stock as of the Record Date that are entitled to vote at the 20112012 Annual Meeting.
The presence, in person or by duly submitted proxy, of the holders of a majority in total number of votes of the issued and outstanding shares of Voting Capital Stock entitled to vote at the 20112012 Annual Meeting is necessary to constitute a quorum in order to transact business at such meeting. Abstentions and, as there is at least one “routine” matter (under applicable NYSE rules) for consideration at the 20112012 Annual Meeting, “broker non-votes,” if any, will be included in the calculation of the number of shares present at the 20112012 Annual Meeting for the purposes of determining a quorum. “Broker non-votes” are shares held by a broker, trustee or nominee that are not voted because the broker, trustee or nominee does not have discretionary voting power on a particular proposal and does not receive voting instructions from the beneficial owner of the shares. Brokers will not be allowed to vote shares as to which they have not received voting instructions from the beneficial owner with respect to Proposal Nos.No. 1 (the election of directors), 3(“say-on-pay”) or 4(“say-on-frequency”). Accordingly, broker non-votes will not be counted as a vote for or against these proposals.this proposal. For shares as to which they have not received voting instructions from the beneficial owner, brokers will be able to vote on Proposal No. 2 (ratification of the Company’sAudit Committee’s selection of its independent registered public accounting firm for 2011)2012), as this is considered a “routine” matter under applicable NYSE rules for which brokers have discretionary voting power.
MacAndrews & Forbes has informed the Company that it will duly submit proxies (1)FORthe election to the Board of Directors of each of the 1112 nominees identified in this Proxy Statement (all of whom currently are directors of the Company);Statement; and (2) FORthe ratification of the Audit Committee’s selection of KPMG LLP as the Company’s independent registered public accounting firm for 2011; (3) FORthe non-binding, advisory approval of the Company’s executive compensation; and (4) for recommending, on a non-binding, advisory basis, conducting future non-binding, advisory votes on executive compensation everyTHREE (3) YEARS.2012. Accordingly, there will be a quorum and the affirmative vote of MacAndrews & Forbes is sufficient, without the concurring vote of any of the Company’s other stockholders, to approve and adopt Proposal Nos. 1 2, 3 and 42 to be considered at the 20112012 Annual Meeting, as aforesaid.
If shares of Class A Common Stock are held as of the Record Date for the account of participants under the Revlon Employees’ Savings, Investment and Profit Sharing Plan (the “401(k) Plan”), the trustee for the 401(k) Plan will vote those shares pursuant to the instructions given by the 401(k) Plan participants on their respective voting instruction forms. If the trustee does not otherwise receive voting instructions for shares held on account of a 401(k) Plan participant, the trustee, in accordance with the 401(k) Plan trust agreement, will vote any such unvoted shares in the same proportion as it votes those shares allocated to 401(k) Plan participants’ accounts for which voting instructions were received by the trustee. 401(k) Plan participants must cast their votes in accordance with the instructions provided in the proxy materials so that they are received by 11:59 p.m. Eastern Time on May 26, 201131, 2012 to allow the trustee time to receive such voting instructions and vote on behalf of participants in the 401(k) Plan. Voting instructions received from 401(k) Plan participants after this deadline, under any method, will not be considered timely and will be voted by the trustee at the 20112012 Annual Meeting in the manner described in this paragraph above.
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The accompanying form of proxy is being solicited on behalf of the Company’s Board of Directors. WeThe Company will bear all costs in connection with preparing, assembling and furnishing this Proxy Statement and related materials, including reimbursing banks, brokerage houses and other custodians, nominees, agents and fiduciaries for their reasonableout-of-pocket expenses for forwarding proxy and solicitation materials to stockholders. The Company has hired Broadridge to assist in the distribution and on-line hosting of proxy materials (including the provision of electronic voting methods) for the 20112012 Annual Meeting. The estimated fee is approximately $10,500, plusout-of-pocket expenses, such as postage.
Some banks, brokers and other nominee record holders may be participating in the practice of “householding” stockholder materials, such as proxy statements, information statements and annual reports. This means that only one copy of our Internet Notice or proxy materials, as the case may be, may have been sent to multiple stockholders in your household. We will promptly deliver a separate copy of our Internet Notice or the 20112012 proxy materials, as the case may be, to you if you write us at the following address: Revlon, Inc., Investor Relations Department, 237 Park Avenue, New York, NY 10017; or our proxy distributor at the following address: Broadridge, 51 Mercedes Way, Edgewood, NJ 11717. If you want to receive separate copies of the stockholder materials in the future, or if you are receiving multiple copies and would like to receive only one copy for your household, you should contact your bank, broker, or other nominee record holder, or you may contact us at the above address. In the interest of reducing costs and promoting environmental responsibility, we encourage our stockholders to review electronic versions of our proxy materials, via the Internet.
The Company’s Board of Directors, pursuant to the Company’s By-laws, has fixed the number of directors at The Board of Directors has been informed that all of the nominees are willing to serve as directors, but if any of them should decline or be unable to serve, the Board of Directors may by resolution provide for a lesser number of directors or designate substitute nominees, in which event the individuals appointed as proxies will vote as directed as to the election of any such substitute nominee. The Board of Directors has no reason to believe that any nominee will be unable or unwilling to serve.eleven (11),12, effective as of the date of the 20112012 Annual Meeting. The 1112 directors nominated for election by the Board of Directors, upon recommendation of the Board’s Nominating and Corporate Governance Committee, will be elected at the 20112012 Annual Meeting to serve until the Company’s next Annual Meeting and until their successors are duly elected and shall have been qualified. AllEleven of the 12 nominees currently are members of the Board of Directors.Directors (Mr. Dinh is a new director nominee). All director nominees, if elected, are expected to serve until the next Annual Meeting.
Brokers do not have the ability to vote on “non-routine” matters, including the election of directors, as to shares for which they have not received voting instructions from the beneficial owner. In light of the application of plurality voting to the electionVOTE REQUIRED AND BOARD OF DIRECTORS’ RECOMMENDATION1112 nominees identified in this Proxy Statement requires the affirmative vote of a plurality of the votes cast by the holders of shares of Voting Capital Stock present in person or represented by proxy at the 20112012 Annual Meeting and entitled to vote. With respect to Proposal No. 1, all proxies properly submitted to the Company, unless such proxies are revoked, will be voted in accordance with the instructions given by the person submitting such proxy or, in the absence of such instructions, will be votedFORthe election to the Board of Directors of each of the 1112 nominees identified in this Proxy Statement.4
The Board of Directors unanimously recommends that stockholders vote FOR the election to the Board of Directors of each of the 1112 nominees identified below.
The name, age (as of December 31, Mr. Perelman Mr. Bernikow (71) has been a Director of the Company and of Products Corporation since September 2003. Mr. Bernikow has served on the Board of Directors of Premier American Bank, N.A. since January 2010 as well as on the Board of Directors of such bank’s parent holding company, Bond Street Holdings, Inc., since October 2010. From 1998 until his retirement in May 2003, Mr. Bernikow served as the Deputy Chief Executive Officer of Deloitte & Touche LLP (“ Mr. Bohan (66) has been a Director of the Company since March 2004 and a Director of Products Corporation since June 2008. Prior to his retirement in February 2001, Mr. Bohan was a Managing Director of the high-yield bond sales group of Salomon Smith Barney, having joined Salomon Smith Barney in 1980. Mr. Bohan serves as a member of the Board of Directors of Arena Brands, Inc., which is a privately-held company. Mr. Bohan serves as a member of the Company’s Audit Committee and Nominating and Corporate Governance Committee. Mr. Bohan has served on the Boards of Directors of the following public reporting companies within the last five years: the Company (2004 — present); Products Corporation (2008 — present); and Haynes International, Inc. (“Haynes”) (2004 — present). Mr. Dinh (43), who is a new director nominee for the Company, is the founding partner of Bancroft PLLC, a law and strategic consulting firm which he founded in 2003. Since 1996, Mr. Dinh has served as Professor of Law at the Georgetown University Law Center, where he is currently the Co-Director of Asian Law and Policy Studies. In addition, Mr. Dinh has served as the General Counsel and Corporate Secretary of Strayer Education, Inc., the holding company parent of Strayer University, since 2009. After graduating from law school in 1993, Mr. Dinh served as a law clerk to the Honorable Laurence H. Silberman, of the U.S. Court of Appeals, D.C. Circuit, and to the Honorable Sandra Day O’Connor, of the U.S. Supreme Court. From 2001 to 2003, Mr. Dinh served as Assistant Attorney General for Legal Policy at the U.S. Department of Justice. Mr. Dinh has served on the Boards of Directors of the following public reporting companies within the last five years: News Corporation (2004 — Present); M & F Worldwide (2007- 2011 (note, M & F Worldwide ceased being a public reporting company under the Exchange Act in December 2011, upon which Mr. Dinh left the Board)); and The Orchard, Inc. (2007- 2010). Mr. Ennis 2010)2011), principal occupation for the last five years, public company board service for the last five years, selected biographical information and period of service as a Director of the Company of each of the nominees for election as a director are set forth below.(67) (68)has been Chairman of the Board of Directors of the Company and of Revlon Consumer Products Corporation, the Company’s wholly-owned operating subsidiary (“Products Corporation”), since June 1998 and a Director of the Company and of Products Corporation since their respective formations in 1992. Mr. Perelman has been Chairman of the Board and Chief Executive Officer of MacAndrews & Forbes, Holdings Inc. (“MacAndrews & Forbes”), a diversified holding company, and certain of its affiliates since 1980. Mr. Perelman has served on the Boards of Directors of the following companies which were required to file reports under the Exchange Act or were registered investment companies under the Investment Company Act of 1940 (the “1940 Act”) (in either case, referred to herein as “public reporting companies”) within the last five years: the Company (1992 — present); Products Corporation (1992 — present); REV Holdings LLC (2002 — 2006); Scientific Games Corporation (“Scientific Games”) (2003 — present); Allied Security Holdings LLC (“Allied Security”) (2004 — 2008); and M&F & F Worldwide Corp. (1995 — present), a holding company that owns and operates various businesses (“M & F Worldwide”), for which Mr. Perelman has served as Chairman of the Board of Directors since 2007 and as a director since 1995 (note, M & F Worldwide ceased being a public reporting company under the Exchange Act in December 2011).M&F Worldwide”D&T”).(40)(41) has been the Company’s and Products Corporation’s President and Chief Executive Officer since May 2009. Mr. Ennis has served as a Director of the Company and of Products Corporation since March 2009. Mr. Ennis served as President, Revlon International from May 2008 to March 2009. Mr. Ennis served as the Company’s and Products Corporation’s Executive Vice President and Chief Financial Officer from November 2006 to May 2009, Treasurer from June 2008 to May 2009, and Corporate Controller and Chief Accounting Officer from September 2006 to March 2007. From March 2005 to September 2006, Mr. Ennis served as the Company’s Senior Vice President, Internal Audit. From 1997 through 2005, Mr. Ennis held several senior financial positions with Ingersoll-Rand Company Limited, a NYSE-listed company, where his duties included regional responsibility for Internal Audit in Europe and global responsibility for financial planning and analysis. Mr. Ennis began his career in 1991 with Arthur Andersen in Ireland. Mr. Ennis is a Chartered Accountant and member of the Institute of Chartered Accountants in Ireland. Mr. Ennis has served as a director of the Ireland — U.S. Council, a non-profit organization that seeks to build business links between America and Ireland, since November 2009. Mr. Ennis has a Bachelor of Commerce Degree from University College, Dublin, Ireland, and a Master of Business Administration Degree from New York University, New York, NY. Mr. Ennis has served on the Boards of Directors of the following public reporting companies which were required to file reports under the Exchange Act within the last five years: the Company (2009 — present) and Products Corporation (2009 — present).Mr. Kennedy (64) has been the Company’s and Products Corporation’s Vice Chairman since May 2009. Mr. Kennedy has served as a Director of the Company and of Products Corporation since September 2006. Mr. Kennedy has also served as Senior Executive Vice President of MacAndrews & Forbes since May 2009. Since April 2011, Mr. Kennedy has served as Vice Chairman and Chief Administrative Officer of Scientific Games (after serving as Vice Chairman since November 2010 and non-executive Vice Chairman since late 2009). Mr. Kennedy served as the Company’s and Products Corporation’s President and Chief Executive Officer from September 2006 to May 2009, and Executive Vice President, Chief Financial Officer and Treasurer from March 2006 to September 2006, and as the Company’s Executive Vice President and Products Corporation’s President, International from June 2002 until March 2006. From 1998 until 2001, Mr. Kennedy was Managing Director (CEO) and a member of the Board of Directors ofCoca-Cola Amatil Limited, a publicly-traded company headquartered in Sydney,5
Mr. Kennedy (65) has been the Company’s and Products Corporation’s Vice Chairman since May 2009. Mr. Kennedy has served as a Director of the Company and of Products Corporation since September 2006.
Mr. Kennedy has also served as Senior Executive Vice President of MacAndrews & Forbes since May 2009. Mr. Kennedy served as Chief Administrative Officer of Scientific Games from April 2011 to March 2012. Mr. Kennedy has served as Vice Chairman of Scientific Games since October 2009. Mr. Kennedy served as the Company’s and Products Corporation’s President and Chief Executive Officer from September 2006 to May 2009, and Executive Vice President, Chief Financial Officer and Treasurer from March 2006 to September 2006, and as the Company’s Executive Vice President and Products Corporation’s President, International from June 2002 until March 2006. From 1998 until 2001, Mr. Kennedy was Managing Director (CEO) and a member of the Board of Directors of Coca-Cola Amatil Limited, a publicly-traded company headquartered in Sydney, Australia and listed on the Sydney Stock Exchange (“Coca-Cola Amatil”). From 1992 to 1997, Mr. Kennedy served as General Manager of the Coca-Cola USA Fountain Division, a unit of The Coca-Cola Company (“Coca-Cola”), which he joined in 1980. Mr. Kennedy has served on the Boards of Directors of the following public reporting companies within the last five years: the Company (2006 — present); Products Corporation (2006 — present); and Scientific Games (2009 — present).
Ms. Lee (56) (57)has been a Director of the Company since January 2006. Ms. Lee is Chairman and Chief Executive Officer of BET Networks (“BET”), a division of Viacom Inc., a global media and entertainment company, that owns and operates Black Entertainment Television. Ms. Lee’s career at BET began in 1986 as Vice President and General Counsel. In 1992, she was named Executive Vice President of Legal Affairs and Publisher of BET’s magazine division, while continuing to serve as BET’s General Counsel. In 1995, Ms. Lee assumed responsibility for BET’s strategic business development and was named President and Chief Operating Officer in 1996. Prior to joining BET, Ms. Lee was an attorney with the Washington, D.C.-based law firm of Steptoe & Johnson. Ms. Lee serves as a member of the Company’s Nominating and Corporate Governance Committee. Ms. Lee has served on the Boards of Directors of the following public reporting companies which were required to file reports under the Exchange Act within the last five years: Eastman Kodak Company (“Kodak”) (1999 — present)2011); WGL
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Ms. Mellon (43) (44)has been a Director of the Company since August 2008. Ms. Mellon is the Chief Creative OfficerPresident of TMellon Enterprises LLC. In 1996, Ms. Mellon founded, and Founder ofthereafter until November 2011 served in a senior executive capacity with, J. Choo Limited (“Jimmy Choo”), a leading manufacturer and international retailer of glamorous,ready-to-wear women’s shoes and accessories based in London, England. Ms. Mellon has served in a senior executive capacity with Jimmy Choo since its inception in 1996.England, including serving most recently as Chief Creative Officer. Prior to that, Ms. Mellon served as accessories editor forBritish Voguemagazine, since 1990, and previously held positions atMirabellamagazine and Phyllis Walters Public Relations. Ms. Mellon also serves on the Board of Directors and on the Creative Advisory Board of The H Company Holdings, LLC, a privately held holding company which owns and manages the Halston fashion design company. Ms. Mellon has served on the BoardsBoard of Directors of the following companies which were required to file reports under the Exchange Actpublic reporting company within the last five years: the Company (2008 — present).
Mr. Santagati (67) (68)has been a Director of the Company since October 2009. Mr. Santagati served as the President of Merrimack College from 1994 to 2008. Prior to his tenure at Merrimack College, Mr. Santagati served as President and Chief Executive Officer of Artel Communications Corporation, a high-tech company (“Artel”), from 1991 to 1994, as a Partner of Lighthouse Capital, Inc., a private investment management firm, from 1990 to 1991, and as Chief Executive Officer of Gaston & Snow, formerly a nationally-recognized, Boston-based law firm, from 1986 to 1990. From 1965 to 1986, Mr. Santagati served in various senior management roles of increasing responsibility with various telecommunications providers, including serving as President and Chief Executive Officer of NYNEX Business Information Systems from 1982 to 1986. Mr. Santagati is also involved with a number of civic organizations and institutions, including serving as Chairman of the Board of the Lawrence General Hospital; on the Executive Committee of the New England Colleges Foundation; and on the Board of Governors of the Lawrence Girls & Boys Club. Mr. Santagati serves as a member of each of the Company’s Compensation Committee and the Company’s Nominating and Corporate Governance Committee. Mr. Santagati has not served on the BoardsBoard of Directors of any companies that were required to file reports under the Exchange Actfollowing public reporting company within the last five years other thanyears: the Company (2009 — present).
Mr. Schwartz (61)(62) has been a Director of the Company since November 2007 and a Director of Products Corporation since March 2004. Mr. Schwartz has served as Executive Vice Chairman and Chief Administrative Officer of MacAndrews & Forbes since October 2007, and as Chief Executive Officer of M&F Worldwide since January 2008. Prior to that, Mr. Schwartz was M&F Worldwide’s Acting Chief Executive Officer and General Counsel since September 2007 and its Executive Vice President and General Counsel since 1996.2007. Mr. Schwartz served as Senior Vice President of MacAndrews & Forbes from 1989 to 1993 and as Executive Vice President and General Counsel of MacAndrews & Forbes and various of its affiliates from 1993 to 2007. Mr. Schwartz is a member of the Board of Trustees of Kenyon College. In addition, Mr. Schwartz is a member of the Board of Visitors of the Georgetown University Law Center. Mr. Schwartz serves as a member of the Company’s Compensation Committee. Mr. Schwartz has served on the Boards of Directors of the following public reporting companies which were required to file reports under the Exchange Act within the last five years: REV Holdings LLC (2002 — 2006); Scientific Games (2003 — present); Products Corporation (2004 — present); Harland Clarke Holdings Corp. (2005 — present); Allied Security (2007 — 2008); the Company (2007 — present); and M&F & F Worldwide (2008 — present)present; note, M & F Worldwide ceased being a public reporting company under the Exchange Act in December 2011).
Ms. Seifert (61) (62)has been a Director of the Company since January 2006. Ms. Seifert has been Chairperson of Katapult, LLC, a business consulting company, since July 2004. Ms. Seifert served as Corporate Executive Vice President — Personal Care of Kimberly-Clark Corporation, a global health and hygiene company (“Kimberly-Clark”), from 1999 until her retirement in June 2004. Ms. Seifert joined Kimberly-Clark in 1978 and, prior to her retirement, served in several senior executive positions in connection with Kimberly-Clark’s domestic and international consumer products businesses. Prior to joining Kimberly-Clark, Ms. Seifert held management positions at The Procter & Gamble Company, Beatrice Foods, Inc. and Fort Howard Paper Company. Ms. Seifert serves as a member of each of the Company’s Audit Committee and its Compensation Committee. Ms. Seifert has served on the Boards of Directors of the following public reporting companies which were required to file reports under the Exchange Act within the last five years: Eli Lilly & Company (1995 — present), for which she also currently serves as a member of its audit committee (“Eli Lilly”); Albertson’s Inc. (2004 — 2006); Paperweight Development Corp. (2004 — present) (“Paperweight Development”); Appleton Papers Inc. (2004 — present) (“Appleton”); the Company (2006 — present); Lexmark International, Inc. (2006 — present) (“Lexmark”); and Supervalu Inc. (2006 — present), for which she also currently serves as a member of its audit committee (“Supervalu”).
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The Board of Directors currently has the following standing committees: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee (the “Governance Committee”). Each of these committees and their functions are described in further detail below.
The Company is a “controlled company” (i.e., one in which more than 50% of the voting power for the election of directors is held by an individual, a group or another company) within the meaning of the rules of the New York Stock Exchange (the “NYSE”). Accordingly, the Company is not required under the NYSE rules to have a majority of independent directors, a nominating and corporate governance committee or a compensation committee (each of which, under the NYSE’s rules, would otherwise be required to be comprised entirely of independent directors). While the Company is not required under NYSE rules to satisfy the above-listed NYSE corporate governance requirements due to its “controlled company” status, the Board has determined that more than a majority of its current directors (including Messrs. Bernikow, Bohan, Feldberg and Santagati and Mses. Lee, Mellon and Seifert), as well as Mr. Dinh, a new director nominee, qualify as independent directors within the meaning of Section 303A.02 of the NYSE Listed Company Manual and under the Board Guidelines for Assessing Director Independence, which the Board adopted in accordance with Section 303A.02 of the NYSE Listed Company Manual. The Board Guidelines for Assessing Director Independence are available atwww.revloninc.com under the heading Investor Relations (Corporate Governance). Notwithstanding the fact that the Company qualifies for the “controlled company” exemption, the Company maintains the Governance Committee and the Compensation Committee. The Company maintains the Governance Committee (comprised of Messrs. Feldberg (Chairman), Santagati and Bohan and Ms. Lee), and the Board of Directors has determined that all members of the Governance Committee qualify as independent directors within the meaning of Section 303A.02 of the NYSE Listed Company Manual and under the Board Guidelines for Assessing Director Independence. The Company also maintains the Compensation Committee (comprised of Messrs. Bernikow (Chairman), Santagati and Schwartz and Ms. Seifert), and the Board has determined that three of the four directors on the Compensation Committee (Mr. Bernikow, Mr. Santagati and Ms. Seifert) qualify as independent directors within the meaning of Section 303A.02 of the NYSE Listed Company Manual and under the Board Guidelines for Assessing Director Independence and also qualify as “non-employee directors” within the meaning of Section 16 of the Exchange Act and as “outside directors” under Section 162(m) (“Section 162(m)”) of the Internal Revenue Code of 1986, as amended (the “Code”). In October 2009, the Company closed a voluntary exchange offer transaction, pursuant to which Revlon, Inc. issued to stockholders (other than MacAndrews & Forbes and certain of its affiliates) 9,336,905 shares of Preferred Stock (the “Exchange Offer”). In connection with the Exchange Offer, the Company entered into a Contribution and Stockholder Agreement, dated August 9, 2009, as amended, with MacAndrews & Forbes, pursuant to which the parties agreed, among other things, that, until October 8, 2013, the Company will continue to maintain a majority of independent directors on its Board of Directors, each of whom meets the “independence” criteria as set forth in Section 303A.02 of the NYSE Listed Company Manual (see “Certain Relationships and Related Transactions — Contribution and Stockholder Agreement”).
During 2010,2011, the Board of Directors held sixfive meetings and acted sixeight times by unanimous written consent; the Audit Committee held six meetings; the Compensation Committee held sevenfour meetings; and the Governance Committee held sixfour meetings.8
While the Board has not adopted a formal policy regarding directors’ attendance at the Company’s annual stockholders’ meeting, directors are invited to attend such meetings. One member of the Company’s Board of Directors attended the Company’s 20102011 Annual Stockholders’ Meeting.
The Company believes that its board leadership structure is appropriate given the specific circumstances of the Company, as its Board continues to function effectively and efficiently. Notwithstanding the fact that the Company is a “controlled” company, more than a majority of the Company’s Directors are independent under applicable SEC and NYSE rules. The Board has established audit, Set forth below is a summary of the Company’s respective Directors’ experience, qualifications (including management experience, education and professional training) and background (including public company board experience and familiarity with the Company, including past service on the Company’s Board of Directors), which, among other factors, including as summarized in each Director’s biographical information presented above in this Proxy Statement, and as set forth below, support their respective qualifications to continue to serve on the Company’s Board of Directors. Without limiting the foregoing —nominatinggovernance and compensation committees, each operating under written charters, to assist the Board in its oversight functions, and in each case those committees are comprised of at least a majority of independent Directors (with each of the Board’s Audit Committee and Governance Committee being comprised entirely of independent directors and three of the four members of the Compensation Committee being independent directors). The qualifications and experience of nominees for board service and committee membership are reviewed annually by the Governance Committee. Nominees for board membership are then recommended by such committee for appointment by the Board. Respective committee chairmen lead each committee. The Company has not established a “lead director” role. At Board and committee meetings, the Chairman of the Board and the Chairman of each such committee, as applicable, presides for the purpose of conducting an orderly and efficient meeting. Independent directors or any other director may lead or initiate discussion, in the interest of promoting thorough consideration of any issue before the Board or any committee.of its committees. The Company has historically maintained separate positions of Chairman and Chief Executive Officer. Mr. Perelman, Chairman and Chief Executive Officer of MacAndrews & Forbes, has held the position of Chairman of the Company’s Board since June 1998 and Mr. Ennis has held the position of President and Chief Executive Officer of the Company since May 2009. The Chairman provides overall leadership to the Board in its oversight function, while the Chief Executive Officer provides leadership in respect to theday-to-day management and operation of the Company’s business. The Board and each committeeof its committees conduct annual self-assessments to review and monitor their respective continued effectiveness. As part of its 20102011 self-assessment exercise, the Board determined, among other things, that its size, composition and structure were appropriate. The Company believes this separation of the Chairman and Chief Executive Officer positions and its overall board leadership structure are appropriate.
• | Mr. | ||
• | Mr. | ||
• | Mr. |
Strayer Education, Inc.), as well as his public company board experience (including at News Corporation and formerly at M & F Worldwide, which ceased to be a public reporting company in December 2011, and The Orchard, Inc.), qualify him to serve on the Company’s Board. |
• | Mr. Ennis: Mr. Ennis’ experience as the Company’s President and Chief Executive Officer, as well as his prior experience as the Company’s Chief Financial Officer, President, Revlon International, and Chief Accounting Officer, qualify him to continue to serve on the Company’s Board. | ||
• | Professor |
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Partners), his business experience (including serving as Senior Advisor at Morgan Stanley), as well as his public company board experience (including at Macy’s, |
• | Mr. | ||
• | Ms. | ||
• | Ms. | ||
• | Mr. | ||
• | Mr. | ||
• | Mr. | ||
• | Ms. |
company board experience (including at Eli Lilly, Supervalu, Appleton, Paperweight Development and Lexmark) and her familiarity with the Company, as well as her prior service as a Director of the Company, qualify her to continue to serve on the Company’s Board. |
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The Audit Committee is comprised of Messrs. Bernikow (Chairman), Bohan and Feldberg and Ms. Seifert, each of whom the Board of Directors has determined satisfies the NYSE’s and the SEC’s audit committee independence and financial experience requirements. Each of these directors served as a member of the Audit Committee during all of The Company has determined that Mr. Bernikow qualifies as an “audit committee financial expert,” under applicable SEC rules. In accordance with applicable NYSE listing standards, the Company’s Board of Directors has considered Mr. Bernikow’s simultaneous service on the audit committees of more than three public companies, namely the audit committees of the Company, Casual Male, Mack-Cali and the UBS Funds, and has determined that such service does not impair his ability to effectively serve on the Company’s Audit Committee as, among other things, Mr. Bernikow is retired and, accordingly, has a 20102011 and each of these directors remained a member of the Audit Committee as of the date of this Proxy Statement.more flexible schedule and more time to commit to service as an Audit Committee and Board member, including on a full-time basis, if necessary; he has significant professional accounting experience and expertise, which renders him highly qualified to effectively and efficiently serve on multiple audit committees; and the audit committees of the UBS Funds effectively function as a single, consolidated audit committee.
The Audit Committee operates under a comprehensive written charter, a printable and current copy of which is available atwww.revloninc.com under the heading, Investor Relations (Corporate Governance).
Pursuant to its charter, the Audit Committee is responsible for assisting the Board of Directors in fulfilling its oversight responsibilities with respect to, among other things, the integrity of the Company’s financial statements and disclosures; the Company’s compliance with legal and regulatory requirements; the appointment, compensation, retention and oversight of the Company’s independent auditors, as well as their qualifications, independence and performance; and the performance of the Company’s internal audit functions. The Audit Committee is also responsible for preparing the annual Audit Committee Report, which is required under SEC rules to be included in this Proxy Statement (see “— Audit“Audit Committee Report,” below).
The Audit Committee has established procedures for (a) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters; and (b) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. These complaint procedures are described in the Audit Committee’s charter, a printable and current copy of which is available atwww.revloninc.com under the heading, Investor Relations (Corporate Governance).
Management represented to the Audit Committee that the Company’s audited consolidated financial statements for the fiscal year ended December 31, The Audit Committee discussed with the Company’s independent registered public accounting firm those matters required to be discussed by Auditing Standards No. 61, as amended (AICPA,Professional Standards, Vol. 1. AU Section 380), as adopted by the Public Company Accounting Oversight Board (the “PCAOB”) in Rule 3200T, including information concerning the scope and results of the audit and information relating to KPMG LLP’s20102011 were prepared in accordance with generally accepted accounting principles, and the Audit Committee has reviewed and discussed such audited consolidated financial statements with management and KPMG LLP, the Company’s independent registered public accounting firm.11
The Audit Committee has received the written disclosures and the letter from the Company’s independent registered public accounting firm, as required by applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and the Audit Committee has discussed with the Company’s independent registered public accounting firm that firm’s independence.
The Audit Committee also reviewed, among other things, the amount of fees paid to the independent registered public accounting firm for audit and permissible non-audit services (see “Audit Fees” in this Proxy Statement, below). The Audit Committee has satisfied itself that KPMG LLP’s provision of audit and non-audit services to the Company is compatible with KPMG LLP’s independence.
Based on the Audit Committee’s review of and discussions regarding the Company’s audited consolidated financial statements and the Company’s internal control over financial reporting with management, the Company’s internal auditors and the independent registered public accounting firm and the other reviews and discussions with the independent registered public accounting firm referred to in the preceding paragraph, subject to the limitations on the Audit Committee’s roles and responsibilities described above and in the Audit Committee charter, the Audit Committee recommended to the Board of Directors that the Company’s audited consolidated financial statements be included in the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 20102011 for filing with the SEC.
Respectfully submitted,
Audit Committee
Alan S. Bernikow, Chairman
Paul J. Bohan
Meyer Feldberg
Kathi P. Seifert
The Compensation Committee is comprised of Messrs. Bernikow (Chairman), Santagati and Schwartz and Ms. Seifert. Each of these directors served as a member of the Compensation Committee during all of 2010, other than Mr. Santagati who was appointed to such committee in February 2010,2011 and each of these directors remained a member of the Compensation Committee as of the date of this Proxy Statement.
The Compensation Committee operates under a comprehensive written charter, a printable and current copy of which is available atwww.revloninc.com under the heading, Investor Relations (Corporate Governance).
Pursuant to its charter, the Compensation Committee reviews and approves corporate goals and objectives relevant to the compensation of the Company’s Chief Executive Officer (the “CEO”), evaluates the CEO’s performance in light of those goals and objectives and determines, either as a committee or together with the Board of Directors, the CEO’s compensation level based on such evaluation. The Compensation Committee also reviews and approves compensation and incentive arrangements for the Company’s executive officers and such other employees of the Company as the Compensation Committee may determine to be necessary or desirable from time to time. The Compensation Committee also reviews and approves awards pursuant to the Third Amended and Restated Revlon, Inc. Stock Plan (the “Stock Plan”) and the Revlon Executive Incentive Compensation Plan (the12
The Compensation Committee is also responsible for reviewing and discussing with the Company’s Chief Executive Officer and Chief Administrative Officerappropriate officers the Compensation Discussion and Analysis required by the SEC’s rules and, based on such review and discussion, (i) determining whether to recommend to the Board of Directors that the Compensation Discussion and Analysis be included in the Company’s annual report onForm 10-K or in the annual proxy statement (and incorporated by reference into the annual report onForm 10-K) and (ii) producing the annual Compensation Committee Report and approving its inclusion in the Company’s annual report onForm 10-K or in the annual proxy statement.
Pursuant to the terms of the Incentive Compensation Plan, the Compensation Committee may delegate to an administrator (who must be an employee or officer of the Company) the power and authority to administer the Incentive Compensation Plan for the Company’s employees, other than its Chief Executive Officer and certain other officers who constitute “covered employees” as defined in Treasury Regulation § 1.162-27(c)§1.162-27(c)(2) (“Section 162(m) Officers”). Section 157(c) of the Delaware General Corporation Law (the “DGCL”) provides that the Company’s Board of Directors (or the Compensation Committee acting on behalf of the Board) may delegate authority to any officer of the Company to designate grantees of equity awards under the Stock Plan other than himself or herself and to determine the number of such equity awards to be issued. The Compensation Committee did not delegate any such authority for 2010.
For a discussion of the role of the Company’s executive officers and compensation consultants in recommending the amount or form of executive and director compensation, see “— Compensation Discussion and Analysis — Role of the Compensation Committee.”
The Compensation Committee does not have any interlocks or insider participation requiring disclosure under the SEC’s executive compensation rules.
The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis set forth below in this Proxy Statement with the Company’s appropriate officers. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement, as well as in the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, Respectfully submitted, Compensation Committee Alan S. Bernikow, Chairman Richard J. Santagati Barry F. Schwartz Kathi P. Seifert2010,2011, including by incorporation by reference to this 20112012 Proxy Statement.
The Governance Committee is comprised of Messrs. Feldberg (Chairman), Santagati and Bohan and Ms. Lee. Each of these Directors served as a member of the Governance Committee during all of 2010, other than13
The Governance Committee operates under a comprehensive written charter, a printable and current copy of which is available atwww.revloninc.com under the heading, Investor Relations (Corporate Governance).
Pursuant to its charter, the functions of the Governance Committee include, among other things: identifying individuals qualified to become Board members; selecting or recommending to the Board proposed nominees for Board membership; recommending directors to the Board to serve on the Board’s standing committees; overseeing the evaluation of the Board’s performance; evaluating the CEO’s and senior management’s performance; overseeing the Revlon, Inc. Related Party Transaction Policy; overseeing the Company’s processes for succession planning for the CEO and other senior management positions; and periodically reviewing the Board’s Corporate Governance Guidelines and Board Guidelines for Assessing Director Independence and recommending changes, if any, to the Board.
The Governance Committee identifies individuals qualified to become members of the Board when any vacancy occurs by reason of disqualification, resignation, retirement, death or an increase in the size of the Board, and selects or recommends that the Board select director nominees for each annual meeting of stockholders and director nominees to fill vacancies on the Board that may occur between annual meetings of stockholders. In evaluating director nominees, the Governance Committee is guided by, among other things, the principles for Board membership expressed in the Company’s Corporate Governance Guidelines, which are available atwww.revloninc.com under the heading, Investor Relations (Corporate Governance). The Governance Committee, in identifying and considering candidates for nomination to the Board, considers, in addition to the requirements set out in the Company’s Corporate Governance Guidelines and the Governance Committee’s charter, the quality of the candidate’s experience, the Company’s needs and the range of talent and experience represented on the Board. In its assessment of each potential candidate, the Governance Committee will consider the nominee’s reputation, judgment, accomplishments in present and prior positions, independence, knowledge and experience that may be relevant to the Company, and such other factors as the Governance Committee determines to be pertinent in light of the Board’s needs over time, including, without limitation, education, diversity, race, gender and other individual qualities and attributes that are expected to contribute to the Board having an appropriate mix of viewpoints. The Governance Committee identifies potential nominees from various sources, such as officers, directors and stockholders, and from time to time retains the services of third party consultants to assist it in identifying and evaluating director nominees.
The Governance Committee will also consider director candidates recommended by stockholders. The process the Governance Committee follows to evaluate candidates submitted by stockholders does not differ from the process it follows for evaluating other director nominees. The Governance Committee may also take into consideration the number of shares held by the recommending stockholder, the length of time that such shares have been held and the number of candidates submitted by each stockholder or group of stockholders over the course of time. Stockholders desiring to submit director candidates must submit their recommendation in writing (certified mail — return receipt requested) to the Company’s Secretary, at Revlon, Inc., 237 Park Avenue, 14th Floor, New York, NY 10017, attention: Michael T. Sheehan. The Governance Committee will accept recommendations for director candidates throughout the year; however, in order for a recommended director candidate to be considered by the Governance Committee for nomination to stand for election at an upcoming annual meeting of stockholders, the recommendation must be received by the Company, as set forth above, not less than 120 days prior to the anniversary date of the date of the14
the stockholder’s name and address, evidence of such stockholder’s ownership of the Company’s Voting Capital Stock, including the number of shares owned and the length of time of ownership, and a statement as to the number of director candidates such stockholder has submitted to the Governance Committee during the period that such stockholder has owned shares of the Company’s Voting Capital Stock, including the names of any candidates previously submitted by such stockholder;
the name of the candidate;
the candidate’s resume or a listing of his or her qualifications to be a director of the Company;
any other information regarding the candidate that would be required to be disclosed in a proxy statement filed with the SEC if the candidate were nominated for election to the Board; and
the candidate’s consent to be named as a director, if selected by the Governance Committee and nominated by the Board.
Stockholder-Director Communications
The Company’s Corporate Governance Guidelines provide that the Company’s Board of Directors will regularly meet in executive session without any member of the Company’s management being present and that the Company’s independent directors will also meet in at least one non-management executive session per year attended only by independent directors. The non-management directors’ and independent directors’ meeting may be a single combined meeting, if the non-management directors are comprised entirely of independent directors. A non-management director will preside over each non-management executive session of the Board, and an independent director will preside over each independent executive session of the Board, although the same director is not required to preside at all such non-management or independent executive sessions. The presiding director at such non-management and independent executive sessions of the Board is determined in accordance with the applicable provisions of the Company’s By-laws, such that the Chairman of the Board of Directors or, in his absence (as is the case with independent executive sessions), a director chosen by a majority of the directors present will preside at such meetings. The Board of Directors met in at least one executive session, attended by only independent directors (all of whom constituted non-management directors), during 2010.152011.
The following table sets forth each of the Named Executive Officers of the Company as of December 31, 20102011 (and their respective current positions with the Company as of the date hereof):
Name | Position | |
David L. Kennedy | Vice Chairman | |
Alan T. Ennis | President and Chief Executive Officer | |
Chris Elshaw | Executive Vice President and Chief Operating Officer | |
Robert K. Kretzman | Executive Vice President and Chief Administrative Officer | |
Steven Berns | Executive Vice President and Chief Financial Officer |
The following sets forth the age (as of December 31, 2010)2011), positions held with the Company and selected biographical information for the Company’s Named Executive Officers whose biographical information is not otherwise included in this Proxy Statement, above, with the Company’s other Directors:
Mr. Elshaw (50)(51) has served as the Company’s and Products Corporation’s Executive Vice President and Chief Operating Officer since May 2009. Mr. Elshaw previously served as the Company’s Executive Vice President and General Manager, U.S. Region, from October 2007 until May 2009. From July 2002 until September 2007, Mr. Elshaw held several leadership roles within Revlon International, including Senior Vice President and Managing Director, Europe, Middle East and Canada from May 2006 to October 2007; Managing Director of Europe and the Middle East from December 2003 to May 2006; General Manager of the U.K., Ireland and European Distributor Markets from February 2003 to December 2003; and General Manager of the U.K. and Ireland from July 2002 to February 2003. Prior to joining the Company, Mr. Elshaw held several senior management sales and marketing positions at Bristol-Myers Squibb (Clairol Division) from 1996 until 2002, including serving as General Manager of the U.K. and Ireland from 2000 until 2002. From 1983 to 1995, Mr. Elshaw served in various European senior sales and marketing positions at Alberto Culver. Mr. Elshaw is a board member of the Personal Care Products Council (formerly known as the Cosmetic, Toiletry & Fragrance Association), a cosmetic and personal care products industry association.
Mr. Kretzman (59) (60)has served as the Company’s and Products Corporation’s Executive Vice President and Chief Administrative Officer since November 2010 and as each of such companies’ General Counsel of each such company from January 2000 to March 2011. Formerly, he served as the Company’s and Products Corporation’s Chief Legal Officer from December 2003 to November 2010, and also as the Company’s and Products Corporation’s Executive Vice President, Human Resources from October 2006 to November 2010. Mr. Kretzman formerly served as the Company’s and Products Corporation’s Secretary from September 1992 to June 2009. Mr. Kretzman served as the Company’s and Products Corporation’s Senior Vice President and General Counsel and Secretary from January 2000 until December 2003. Prior to becoming General Counsel, Mr. Kretzman served as Senior Vice President and Deputy General Counsel and Secretary from March 1998 to January 2000, as Vice President and Deputy General Counsel and Secretary from January 1997 to March 1998, and as Vice President, and SecretaryLaw from September 1992 to January 1997. Mr. Kretzman joined the Company in 1988 as Senior Counsel responsible for mergers and acquisitions. Mr. Kretzman has also served as the Company’s ChiefCorporate Compliance Officer sincefrom January 2000.
Mr. Berns (46)(47) has served as the Company’s and Products Corporation’s Executive Vice President and Chief Financial Officer since May 2009. Mr. Berns alsoformerly served as the Company’s and Products Corporation’s Treasurer from May 2009 to February 2010. Mr. Berns previously served as Chief Financial Officer of Tradeweb, LLC from November 2007 to May 2009. From November 2005 until July 2007, Mr. Berns served as President, Chief Financial Officer and Director of MDC Partners Inc. From September 2004 to November 2005, Mr. Berns served as Vice Chairman and Executive Vice President of MDC Partners. Prior to that, Mr. Berns was the Senior Vice President and Treasurer of The Interpublic Group of Companies, Inc. from
August 1999 until September 2004. Before that, Mr. Berns held a variety of positions in finance with the Company from April 1992 until August 1999, becoming Senior Vice President and Treasurer in 1996, after having served as the Company’s Vice President, Corporate Finance, Investor Relations. Prior to joining the Company in 1992, Mr. Berns worked at Paramount Communications Inc. and at a predecessor public accounting firm of Deloitte & Touche.D&T. Mr. Berns served as a Director and member of the audit nominating and corporate governance and compensation committees for LivePerson, Inc. from April 2002 until AprilJune 2011. Mr. Berns is a Certified Public Accountant.
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The Company has reviewed and considered all of its compensation plans and practices and does not believe that its compensation policies and practices create risks that are reasonably likely to have a material adverse effect on the Company.
The Company’s senior management is responsible for identifying and managing risks to the Company’s business and the Board’s Audit Committee is responsible for reviewing and discussing that process with management. In accordance with applicable NYSE rules for listed issuers, the Audit Committee maintains an Audit Committee charter that addresses the duties and responsibilities of the Audit Committee, including the requirement that such committee discuss the Company’s guidelines, policies and processes with respect to risk assessment and risk management. As part of the Company’s enterprise risk management function, management identifies internal and external risk factors, monitors identified risks and takes appropriate action to mitigate such identified risks. Specifically, the Company’s internal audit group, with input from the Company’s senior management, leads a comprehensive enterprise risk assessment annually using an established risk management framework. This process identifies and characterizes risks based on the possible impact to the Company’s business and likelihood of occurrence. The Company’s management puts in place appropriate plans to mitigate the risks identified. The risk assessment is also taken into account in the formulation of the internal audit plan for the ensuing year. The Audit Committee reviews and discusses the Company’s risk assessment and risk management guidelines, policies and processes at least annually. Further, the Board reviews the Company’s business plan and receives regular business and financial updates, including progress against the Company’s business plan, at Board meetings, enabling the Board to understand, and remain updated on,regarding, the business risks faced by the Company and the Company’s management of those risks.
Set forth below is a discussion and analysis of all material elements of the Company’s compensation of its Named Executive Officers, including: (i) the objectives of the Company’s compensation program; (ii) what the compensation program is designed to reward; (iii) each element of compensation; (iv) why the Company chooses to pay each element; (v) how the Company determines the amount (and, where applicable, the formula) for each element to pay; and (vi) how each compensation element and the Company’s decisions regarding that element fit into the Company’s overall compensation objectives and may affect decisions regarding other elements of compensation.
Set forth below is a summary of the key actions which the Company took in respect to its For 2011, the Company’s incentive compensation programs were comprised of an annual cash bonus program (the “2011 Annual Bonus Program”) and a cash long-term incentive compensation (“LTIP”) program (the “2011 LTIP Program;” and, together with the 2011 Annual Bonus Program, referred to herein collectively as the “2011 Incentive Compensation Programs”), each of which was approved by the Compensation Committee and is governed by the terms of the Incentive Compensation Plan. Based on the Company’s achievement of 2011 adjusted EBITDA of $266 million, representing approximately 97% of the Company’s 2011 EBITDA performance goal, and 2011 free cash flow of $74 million, representing approximately 105% of the Company’s 2011 free cash flow performance goal, in February 2012 the Compensation Committee, In March 2012, the Company paid annual cash bonuses under the 2011 Annual Bonus Program to eligible employees, including its eligible Named Executive Officers, based upon the extent of the Company’s achievement of its performance goals under such program, individual performance rating and the degree of achievement by bonus program participants of their individual performance objectives for 2011, subject to the terms of such program. The Company provided merit salary increases in March 2011. At the Company’s 2011 Annual Stockholders’ Meeting, approximately 99% of the stockholders who voted on the “say-on-pay” proposal approved the compensation of the Company’s Named Executive Officers, which the Company has considered in determining its compensation policies and decisions and which vote the Company believes provides an endorsement of the Company’s compensation philosophy, processes and practices. The Company’s philosophy is to provide a compensation package that is reasonably designed to satisfy the following objectives: to pay for performance (by basing salary increases upon individual merit and basing incentive compensation payouts upon the achievement of corporate and individual performance goals and objectives); to align the interests of management and employees with corporate performance and shareholder interests, by rewarding performance that is directly linked to achieving the Company’s business plan and strategic goals and fostering shareholder value creation over the long term; and to attract, retain and motivate exceptional performers and key contributors with the skills and experience necessary for the Company to achieve its business objectives, which requires that the Company’s compensation programs be competitive with the compensation practices of other companies, as discussed in further detail below. In order to achieve the objectives discussed above, the Company maintains a long-term incentive compensation under the Incentive Compensation Plan, contingent upon the Company achieving specific performance goals and In the past, the performance-based and incentive compensation elements of annual cash bonus and prior equity grants The Company’s As part of its assessment of the compensation of the Named Executive Officers, the Company also compares the Named Executive Officers’ total compensation to the total compensation for executives at comparison group companies. The Company seeks to design its total compensation to be competitive with other leading consumer products companies and other companies outside of the consumer products field, as the Company believes that the market for certain executive talent is broader than the consumer products field. When reviewing and setting Named Executive Officer compensation for For Base salary adjustments are considered annually and may be based on individual performance, assumption of new responsibilities, competitive data from the Comparison Group, employee retention efforts and the Company’s overall compensation guidelines and annual salary budget guidelines. Higher annual increases may be made to higher performers and key contributors, provided that the overall increases are within budgeted guidelines. Each year, the Compensation Committee reviews and establishes the performance measures for the Company’s incentive compensation Payouts under the The Under the The Company’s President and Chief Executive Officer and its Executive Vice President and Chief Administrative Officer develop, for review and approval by the Compensation Committee, the annual objectives against which each Named Executive Officer’s performance is assessed. The Company’s President and Chief Executive Officer in conjunction with the Executive Vice President and Chief Administrative Officer and the Company’s Vice Chairman, develop, for review and approval by the Compensation Committee, the CEO’s objectives to support and drive the execution of the Company’s business strategy. These objectives are derived from the Company’s annual business plan. These objectives are established by the Compensation Committee at the start of the year and then reviewed after the end of the year to assess the extent to which they have been achieved. For Mr. Ennis — President and Chief Executive Officer: the Company’s the Company’s achievement of a 4.5% increase in the the continued improvement of the Company’s organizational capabilities through significant new hires and internal promotions, developmental assignments and succession planning, and the continued improvement of the Company’s performance management processes through training programs, on which 10% of Mr. Ennis’ target award was based; and the development of a the Company’s 2011 reported financial results, which supported the Company’s achievement of approximately 97% of its 2011 EBITDA Performance Goal, on which 25% of Mr. Elshaw’s target award was based, and approximately 105% of its 2011 Free Cash Flow Performance Goal, on which 25% of Mr. Elshaw’s target award was based; the Company’s achievement of a 4.5% increase in net sales, on which 20% of Mr. Elshaw’s target award was based; the successful implementation of the Company’s integrated business planning process and portfolio planning process and the achievement of inventory management objectives, on which 10% of Mr. Elshaw’s target award was based; the continued improvement of the Company’s organizational capabilities through significant new hires and internal promotions, developmental assignments and succession planning, and the continued improvement of the Company’s performance management processes through training programs, on which 10% of Mr. Elshaw’s target award was based; and the development of a framework for long-range strategic planning, the execution of identified global growth initiatives, and the continued evaluation of acquisition opportunities (including, without limitation, the Company’s consummation of the acquisition of the Sinful Colors business in March 2011), on which 10% of Mr. Elshaw’s target award was based. Mr. Berns — Executive Vice President and Chief Financial Officer: the Company’s 2011 reported financial results, which supported the Company’s achievement of approximately 97% of its 2011 EBITDA Performance Goal, on which 25% of Mr. Berns’ target award was based, and approximately 105% of its 2011 Free Cash Flow Performance Goal, on which 25% of Mr. Berns’ target award was based; the Company’s achievement of a 4.5% increase in net sales, on which 20% of Mr. Berns’ target award was based; the successful implementation of the Company’s integrated business planning process and portfolio planning process and the achievement of inventory management objectives, on which 10% of Mr. Berns’ target award was based; the continued improvement of the Company’s organizational capabilities through significant new hires and internal promotions, developmental assignments and succession planning, and the continued improvement of the Company’s performance management processes through training programs, on which 10% of Mr. Berns’ target award was based; and the achievement of key functional objectives within the Finance area, including successfully refinancing the Company’s credit facility, reducing interest expense and extending maturities; achievements within the information management function, including providing for more applications on a master data model; continuing to improve the financial close process and continuing to maintain and strengthen the financial control environment; implementing the operating framework for the Company’s business continuity plan; developing a framework for long-range strategic planning; and continuing to evaluate acquisition opportunities (including, without limitation, the Company’s consummation of the acquisition of the Sinful Colors business in March 2011), on which 10% of Mr. Berns’ target award was based. Mr. Kretzman — Executive Vice President and Chief Administrative Officer: the Company’s 2011 reported financial results, which supported the Company’s achievement of approximately 97% of its 2011 EBITDA Performance Goal, on which 25% of Mr. Kretzman’s target bonus was based, and approximately 105% of its 2011 Free Cash Flow Performance Goal, on which 25% of Mr. Kretzman’s target award was based; the Company’s achievement of a 4.5% increase in net sales, on which 20% of Mr. Kretzman’s target award was based; the successful implementation of the Company’s integrated business planning process and portfolio planning process and the achievement of inventory management objectives, on which 10% of Mr. Kretzman’s target award was based; the continued improvement of the Company’s organizational capabilities through significant new hires and internal promotions, developmental assignments and succession planning, and the continued improvement of the Company’s performance management processes through training programs, on which 10% of Mr. Kretzman’s target award was based; and the achievement of key functional objectives within the Legal, Human Resource and Facilities Management areas, including the provision of comprehensive legal and human resource support in all aspects of the Company’s business strategy; leadership of the highly successful recruitment of key senior executives globally; implementing cost savings in the Company’s healthcare programs; negotiating real estate and facility cost savings; the development and preparation of certain senior management successors; and the continued evaluation of acquisition opportunities (including, without limitation, the Company’s As noted above, based on the extent of the Company’s achievement of its The Company’s confidentiality and non-competition agreement (which all employees, including the Named Executive Officers, are required to execute), Stock Plan and Incentive Compensation Plan condition each employee’s eligibility for benefits (including Approximately 440 employees, including the Named Executive Officers, were eligible to participate in the Per the terms of their respective employment agreements, Mr. Ennis was eligible during Based on the Company’s The Summary Compensation Table, below, reflects the The third principal component of total compensation for the Company’s key employees is long-term incentive compensation awards. Historically, this had taken the form of an annual grant of equity awards, usually in the form of restricted stockand/or stock options, under the Stock Plan. However, beginning with 2009 (and again in Approximately Awards under the Based on the Company’s achievement of 2011 adjusted EBITDA of $266 million and 2011 free cash flow of $74 million, and, based upon the The Summary Compensation Table, below, reflects the The Company also maintains standard benefits that are consistent with those offered by other major corporations and which are generally available to all of the Company’s full time employees (subject to meeting basic eligibility requirements). These plans include standard medical, dental, vision and life insurance coverages that are available to allU.S.-based, non-union employees. The Company also maintains a limited number of benefit programs that are available to the Named Executive Officers and other senior employees qualifying for eligibility based on salary grade level. These benefits and perquisites include an automobile allowance or use of a Company automobile and limited reimbursement of certain costs for financial counseling, tax preparation and life insurance premiums. These types of benefits are commonly made available to senior executives at other major corporations and assist the Company in attracting and retaining key talent. The Company focuses annually on developing a total compensation package that is intended to be competitive such that the level of total compensation (i.e., base salary, annual cash bonus and long-term incentive compensation, combined) is targeted to be positioned at or about the 50th to 75th percentile of competitive benchmark norms. Salary ranges, annual cash bonus plan targets and long-term incentive compensation targets are reviewed using a “total compensation” perspective under which total remuneration is targeted to be within certain ranges compared to the Comparison Group. Values and targets of each element may change from year to year. The Company designs its compensation programs such that there is a correlation between level of position and degree of risk in compensation. Based on that guiding principle, the Company’s more senior executives with the highest levels of responsibility and accountability have a higher percentage of their total potential remuneration at risk (in the form of performance-based annual cash bonuses and performance-based LTIP awards), than do employees with lower levels of responsibility and accountability. This means that a higher proportion of the Company’s more senior executives’ total potential compensation is based upon variable elements, than is the case with the Company’s employees with lower levels of responsibility and accountability. The Compensation Committee reviews and approves, among other things, compensation for the Company’s Named Executive Officers; the structure of the Company’s annual bonus program under the Incentive Compensation Plan, including setting annual performance objectives for the Named Executive Officers and annually assessing the extent to which those objectives have been achieved; and the structure of the performance-based objectives and actual grants under the Company’s long-term incentive compensation award programs and annually assessing the extent to which The Compensation Committee reviews and approves objectives relevant to the compensation of the Company’s Chief Executive Officer, evaluates, together with the Governance Committee, the Chief Executive Officer’s performance in respect of those objectives and determines, either as a committee or together with the Governance Committeeand/or the Board of Directors, the Chief Executive Officer’s total compensation level based on that evaluation process. The Compensation Committee also reviews and approves compensation and incentive arrangements for the Company’s other Named Executive Officers. The Compensation Committee reviews key components of each Named Executive Officer’s compensation, which enables the Compensation Committee to make informed decisions regarding future elements of compensation. The Company’s Executive Vice President and Chief Administrative Officer, in consultation with the Company’s Chief Executive Officer, works with the Company’s As part of the Company’s processes and procedures for determining the amount and form of executive officer and director compensation, the Company’s Compensation Committee relies in part upon informed proposals and information provided by management, as well as market data, analysis and guidance provided by its outside compensation consultant. During well as the total direct compensation of the Company’s Named Executive Officers, inclusive of the March As there has never been a restatement of the Company’s financial results, the Company has not considered any policy in respect of adjustment or recovery of amounts paid under its compensation plans. On June 2, 2011, the Company held its 2011 Annual Stockholders’ Meeting (the “2011 Annual Meeting”) at which approximately 99% of the stockholders who voted on the given items (i) approved, on an advisory, non-binding basis, the Company’s executive compensation, as disclosed pursuant to Item 402 of Regulation S-K, including as disclosed in the “Compensation Discussion and Analysis,” compensation tables and accompanying narrative set forth in the 2011 proxy statement (“say-on-pay”), and (ii) recommended, on an advisory, non-binding basis, that the Company conduct future “say-on-pay” votes every three (3) years (which is the Company’s current intention). Although such advisory stockholder vote on executive compensation is non-binding, management has considered the results of such advisory vote when determining the Company’s compensation policies and decisions and believes that the above-referenced stockholder vote endorses the Company’s compensation philosophy, processes and practices. Section 162(m) places a limit of $1,000,000 on the amount of compensation that the Company may deduct, for tax purposes, in any one year for certain officers who constitute “covered employees” under the rule, unless such amounts are determined to be “performance-based compensation” meeting certain requirements. Generally, the Company’s provision of cash incentive compensation under the Incentive Compensation Plan, stock option awards and performance-based stock awards meets the requirements for performance-based compensation under Section 162(m) and thus, generally, those items are fully deductible. Salary, perquisites, discretionary bonuses and restricted stock that have time-based vesting generally are not considered performance-based compensation under Section 162(m) and are generally subject to Section 162(m) limitations on deductibility. To maintain flexibility in compensating executive officers in a manner designed to promote varying corporate goals, the Compensation Committee has not adopted a policy requiring all compensation to be deductible. The The following table sets forth information for the years indicated concerning the compensation awarded to, earned by or paid to the persons who served as the Company’s Chief Executive Officer and the Chief Financial Officer during the Summary Compensation Table, below, Name and Principal Position(a) David L. Kennedy Vice Chairman Alan T. Ennis President and Chief Executive Officer Chris Elshaw Executive Vice President and Chief Operating Officer Robert K. Kretzman Executive Vice President and Chief Administrative Officer Steven Berns Executive Vice President and Chief Financial Officer For Mr. Ennis, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $891,800 in cash bonus plus $1,176,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2011 (the remaining two-thirds of such 2011 LTIP award is to be paid out in equal amounts in March 2013 and March 2014). For Mr. Elshaw, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $534,100 in cash bonus plus $490,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2011 (the remaining two-thirds of such 2011 LTIP award is to be paid out in equal amounts in March 2013 and March 2014). For Mr. Kretzman, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $559,090 in cash bonus plus $490,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2011 (the remaining two-thirds of such 2011 LTIP award is to be paid out in equal amounts in March 2013 and March 2014). For Mr. Berns, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $347,673 in cash bonus plus $490,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2011 (the remaining two-thirds of such 2011 LTIP award is to be paid out in equal amounts in March 2013 and March 2014). The amounts under the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column have been calculated based on the aggregate change in actuarial present value of the Named Executive Officers’ accumulated benefit under the Retirement Plan and the Pension Equalization Plan from January 1 to December 31 of each reported year and based on, with respect to 2011, the assumptions as set forth in Note 14 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 (the “2011 Form 10-K”); with respect to 2010, the assumptions as set forth in Note 14 to the consolidated financial statements in the Company’s Annual Report onForm 10-K for the year ended December 31, For Mr. Kennedy, who has over 9 years of actual service with the Company, this amount includes $8,580, $5,417 and $18,541 under the Retirement Plan and $29,353, $18,532 and $82,605 under the Pension Equalization Plan for 2011, 2010 and 2009, respectively. For Mr. Ennis, who has over 6 years of actual service with the Company, this amount includes $15,624, $8,823 and $18,158 under the Retirement Plan and $19,008, $10,734 and $38,018 under the Pension Equalization Plan for 2011, 2010 and 2009, respectively. For Mr. Elshaw, who has over 10 years of actual service with the Company, this amount includes $4,352, $2,730 and $12,722 under the Retirement Plan and $4,246, $2,664 and $21,504 under the Pension Equalization Plan for 2011, 2010 and 2009, respectively. For Mr. Kretzman, who has over 23 years of actual service with the Company, this amount includes $171,179, $74,057 and $117,445 under the Retirement Plan, and $526,311, $227,706 and $555,868 under the Pension Equalization Plan for 2011, 2010 and 2009, respectively, and $611,840 and $311,184 under his employment agreement for 2011 and 2010, respectively. The pension plans were frozen on December 31, 2009. Mr. Kretzman’s employment agreement provides that he continues to accrue retirement benefits through his retirement date, and that he is entitled to a retirement benefit at and after age 60. The aggregate change in the actuarial present value of Mr. Kretzman’s accumulated benefit calculated under the Retirement Plan, the Pension Equalization Plan and his employment agreement for 2011 is, respectively, $144,584, $444,517 and $942,229, based on retirement at age 60. For Mr. Berns, who has over 9 years of actual service with the Company (due to credited service during his period of employment with the Company from April 1992 to August 1999), this amount includes $29,749, $12,529 and $12,781 under the Retirement Plan and $13,222, $5,569 and $5,680 under the Pension Equalization Plan for 2011, 2010 and 2009, respectively. Mr. Ennis. The amount shown under All Other Compensation for Mr. Ennis for 2011 consists of a car allowance; tax preparation services; life insurance premiums; profit sharing contributions (including $40,950 of profit sharing contributions under the Amended and Restated Revlon Excess Savings Plan (the “Excess Savings Plan”) and the 401(k) Plan); and matching contributions under the 401(k) Plan. Mr. Elshaw. The amount shown under All Other Compensation for Mr. Elshaw for 2011 consists of $150,000 in housing allowance (as Mr. Elshaw relocated to the U.S. from the U.K. at the Company’s request in connection with his promotion in 2007 to Executive Vice President and General Manager, U.S. Region, prior to his being appointed Executive Vice President and Chief Operating Officer in May 2009); a car allowance; life insurance premiums; profit-sharing contributions (including $33,363 of profit sharing contributions under the Excess Savings Plan and the 401(k) Plan); and matching contributions under the 401(k) Plan. Mr. Kretzman. The amount shown under All Other Compensation for Mr. Kretzman for 2011 consists of $18,016 in tax gross ups in respect of imputed income arising from use of a Company automobile and life insurance premiums; and other compensation in respect of use of a Company automobile; life insurance and medical plan premiums; tax preparation services; and matching contributions under the 401(k) Plan. Mr. Berns. The amount shown under All Other Compensation for Mr. Berns for 2011 consists of a car allowance; life insurance premiums; tax preparation services and financial counseling; profit sharing contributions (including $20,845 of profit sharing contributions under the Excess Savings Plan and the 401(k) Plan); and matching contributions under the 401(k) Plan. Each of Messrs. Kennedy, Ennis, Elshaw, Kretzman and Berns, who were the Company’s Named Executive Officers during Mr. Kennedy Mr. Kennedy’s employment agreement provides that he will serve as Vice Chairman of the Board of Directors at an annual base salary of not less than $150,000 (which was his base salary as of December 31, Products Corporation may terminate Mr. Kennedy’s employment agreement effective 24 months after written notice of non-extension of the agreement, and Mr. Kennedy may terminate his employment agreement at any time upon 60 days’ prior written notice following a material uncured breach by Products Corporation of its obligations to Mr. Kennedy under such agreement. Mr. Kennedy’s employment agreement provides that, in the event of termination of employment by Mr. Kennedy for any material breach by Products Corporation of any of its obligations under his employment agreement, or by Products Corporation (otherwise than for “cause” as defined in the employment agreement or for disability), Mr. Kennedy would be entitled to continued payments of base salary throughout the24-month severance period, payment of a prorated target bonus, if and to the extent bonuses are payable to executives under the Incentive Compensation Plan for that year based upon achievement of objectives (commencing with the 2012 performance year), continued participation in Products Corporation’s life insurance plan, subject to a limit of two years, and medical plans, subject to the terms of such plans, throughout the severance period or until Mr. Kennedy is covered by like plans of another company, and continued participation during the severance period in the other perquisites of Products Corporation for which he was eligible on the termination date. The estimated aggregate total of termination benefits during the24-month severance period if Mr. Kennedy had been terminated without “cause” on December 31, current employment agreement, he is eligible to receive LTIP awards under the Incentive Compensation Plan beginning with the 2012 performance year. All of Mr. Kennedy’s severance payments are conditional on his full compliance with the Company’s comprehensive agreement as to confidentiality and non-competition during any severance period. Mr. Ennis Mr. Ennis’ employment agreement provides that Mr. Ennis will serve as the Company’s President and Chief Executive Officer, at an annual base salary of not less than $910,000 (which was his base salary as of December 31, Under his employment agreement, Mr. Ennis is eligible to participate in fringe benefit programs and perquisites as may be generally made available to other senior executives of Products Corporation, including a car allowance and financial planning and tax preparation assistance. The employment agreement for Mr. Ennis also provides for protection of Company confidential information and includes a non-compete obligation. Products Corporation may terminate Mr. Ennis’ employment agreement effective 24 months after written notice of non-extension of the agreement, and Mr. Ennis may terminate his employment agreement upon 60 days’ prior written notice following a material uncured breach by Products Corporation of its obligations to Mr. Ennis under such agreement. Mr. Ennis’ employment agreement provides that, in the event of termination of employment by Mr. Ennis for any material breach by Products Corporation of any of its obligations under his employment agreement or by Products Corporation (otherwise than for “cause” as defined in Mr. Ennis’ employment agreement or disability), Mr. Ennis would be entitled to continued payments of base salary throughout the24-month severance period, payment of a prorated target bonus, if and to the extent bonuses are payable to executives under the Incentive Compensation Plan for that year based upon achievement of objectives, and continued participation in Products Corporation’s life insurance plan, subject to a limit of two years, and medical plans, subject to the terms of such plans, throughout the severance period or until Mr. Ennis is covered by like plans of another company and continued participation during the severance period in the other perquisites of Products Corporation for which he was eligible on the termination date. The estimated aggregate total of termination benefits during the24-month severance period if Mr. Ennis had been terminated without “cause” on December 31, Mr. Elshaw Mr. Elshaw’s employment agreement provides that Mr. Elshaw will serve as the Company’s Executive Vice President and Chief Operating Officer, at an annual base salary of not less than Under his employment agreement, Mr. Elshaw, who relocated to the U.S. from the U.K. at the Company’s request in connection with his promotion in 2007 to Executive Vice President and General Manager, U.S. Region, prior to his being appointed Executive Vice President and Chief Operating Officer in May 2009, receives a $150,000 annual housing allowance through December 31, 2012, and is eligible to participate in fringe benefit programs and perquisites as may be generally made available to other senior executives of Products Corporation, including a car allowance and financial planning and tax preparation assistance. The employment agreement for Mr. Elshaw also provides for protection of Company confidential information and includes a non-compete obligation. Products Corporation may terminate Mr. Elshaw’s employment agreement effective 24 months after written notice of non-extension of the agreement. Mr. Elshaw’s employment agreement provides that, in the event of termination of employment by Products Corporation (otherwise than for “cause” as defined in Mr. Elshaw’s employment agreement or disability), Mr. Elshaw would be entitled to continued payments of base salary throughout the24-month severance period, payment of a prorated target bonus, if and to the extent bonuses are payable to executives under the Incentive Compensation Plan for that year based upon achievement of objectives, continued participation in Products Corporation’s life insurance plan, subject to a limit of two years, and medical plans, subject to the terms of such plans, throughout the severance period or until Mr. Elshaw is covered by like plans of another company, and repatriation to the U.K. The estimated aggregate total of termination benefits during the24-month severance period if Mr. Elshaw had been terminated without “cause” on December 31, Mr. Kretzman Mr. Kretzman’s employment agreement provides that he will serve as Executive Vice President and Chief Administrative Officer, at an annual base salary of not less than Under his employment agreement, Mr. Kretzman is eligible for participation in fringe benefit programs and perquisites as may be generally made available to senior executives of Products Corporation of Mr. Kretzman’s level, including financial planning and tax preparation assistance; use of an automobile; supplemental term life insurance coverage of two times Mr. Kretzman’s base salary; executive medical plan coverage; continued accrual of retirement benefits until his retirement date (in lieu of any discretionary profit sharing contributions); and a retirement benefit at and after age 60 without regard to the early retirement reductions he would otherwise be subject to under the Retirement Plan and Pension Equalization Plan and giving effect to his years of service and compensation through his retirement date. Mr. Kretzman’s employment agreement also provides for protection of Company confidential information and includes a non-compete obligation. for “good reason,” or upon his retirement, all restricted stock and stock option awards held by Mr. Kretzman would continue to vest and remain exercisable, and the unpaid portion of all The estimated aggregate total of termination benefits during the24-month severance period if Mr. Kretzman had been terminated without “cause” on December 31, Mr. Berns Mr. Berns’ employment agreement Under his employment agreement, Mr. Berns is eligible to participate in fringe benefit programs and perquisites as may be generally made available to other senior executives of Products Corporation, including a car allowance and financial planning and tax preparation assistance. The employment agreement for Mr. Berns also provides for protection of Company confidential information and includes a non-compete obligation. Products Corporation may terminate Mr. Berns’ employment agreement effective 24 months after written notice of non-extension of the agreement and Mr. Berns may terminate his employment agreement upon 60 days’ prior written notice following a material uncured breach by Products Corporation of its obligations to Mr. Berns under such agreement. Mr. Berns’ employment agreement provides that, in the event of termination of employment by Mr. Berns for any material uncured breach by Products Corporation of any of its obligations under his employment agreement, or by Products Corporation (otherwise than for “cause” as defined in Mr. Berns’ employment agreement or disability), Mr. Berns would be entitled to continued payments of base salary throughout the24-month severance period, payment of a prorated target bonus, if and to the extent bonuses are payable to executives under the Incentive Compensation Plan for that year based upon achievement of objectives, continued The estimated aggregate total of termination benefits during the24-month severance period if Mr. Berns had been terminated without “cause” on December 31, Each of Messrs. Kennedy’s, Elshaw’s, Ennis’, Kretzman’s and Berns’ employment agreements provides that, in the event of any “change of control,” the terms of their employment agreements would be extended for an additional 24 months from the effective date of any such “change of control.” Each of their employment agreements also provides that if, within this24-month period, the executive were to terminate his employment with the Company for “good reason” or if the Company were to terminate the executive’s employment other than for “cause,” he would receive: (i) a lump-sum payment equal to two times the sum of (a) the executive’s base salary and (b) the executive’s average gross bonus earned over the five calendar years prior to termination; and (ii) 24 months of continuation of all fringe benefits in which the executive participated on the “change of control” effective date or, in lieu of such benefits, a lump-sum cash payment equal to the value of such benefits. Each of their employment agreements also provides that, in the event of a “change of control,” all then-unvested stock options and restricted shares held by them shall immediately vest and become fully exercisable. Under the Incentive Compensation Plan, if, in connection with a “change in control,” a successor entity assumes the LTIP, does not terminate the LTIP or provides participants with comparable LTIP benefits, then the LTIP awards remain payable in accordance with their terms. Otherwise, upon a “change in control,” LTIP awards related to the year when the event occurred are to be paid at target on a pro-rated basis (based on the number of days elapsed) within 60 days following such “change in control,” and (ii) LTIP awards related to prior years as to which the respective performance objectives were achieved, but for which payments remain outstanding, are to be paid within 60 days following such “change in control.” The estimated aggregate total of benefits upon a “change of control” and subsequent termination if Mr. Kennedy had been terminated on December 31, The estimated aggregate total of benefits upon a “change of control” and subsequent termination if Mr. Ennis had been terminated on December 31, The estimated aggregate total of benefits upon a “change of control” and subsequent termination if Mr. Elshaw had been terminated on December 31, The estimated aggregate total of benefits upon a “change of control” and subsequent termination if Mr. Kretzman had been terminated on December 31, approximately The estimated aggregate total of benefits upon a “change of control” and subsequent termination if Mr. Berns had been terminated on December 31, The following table presents information about the non-equity, plan-based awards that were granted to Named Executive Officers in the last completed fiscal year. During The Compensation Committee granted, and authorized the payment of, performance-based LTIP awards and annual cash bonuses to eligible Named Executive Officers in respect to Name Alan Ennis President and Chief Executive Officer Chris Elshaw EVP and Chief Operating Officer Robert Kretzman EVP and Chief Administrative Officer Steven Berns EVP and Chief Financial Officer Awards under the 2011 LTIP Program were structured as flat dollar amounts that could be earned upon achievement of the Company’s 2011 Performance Goals, subject to the grantee achieving at least target performance on his 2011 Performance Management Review. Payouts to grantees of earned awards under the 2011 LTIP Program are to be made in equal one-third amounts over three years, one-third of which was paid in March 2012, with the remaining two-thirds payable in equal installments in March 2013 and March 2014, if the grantee is employed with the Company on the remaining payout dates, unless provided otherwise in the executive’s employment agreement (see “Employment Agreements and Payments upon Termination and Change of Control”). Pursuant to its terms, the 2011 LTIP Program would not be funded, and no award would be payable, if the Company were to achieve less than 85% of its 2011 Performance Goals (represented by the “Threshold” column, above); the 2011 LTIP Program could have been funded at the “Target” level if the Company achieved 100% of its 2011 Performance Goals; and the 2011 LTIP Program could have been funded at 150% of the “Target” level for achievement by the Company of 120% of its 2011 Performance Goals (represented by the “Maximum” column, above). The Compensation Committee determined to fund and pay out 2011 LTIP Program awards at 98% of the “Target” level based on the attainment of 2011 Performance Goals, pursuant to the formula set forth in the 2011 LTIP Program. The The following table sets forth certain information regarding equity awards held by the Named Executive Officers under the Company’s Stock Plan which remained outstanding as of December 31, Name David L. Kennedy Vice Chairman Alan T. Ennis President and Chief Executive Officer Chris Elshaw Executive Vice President and Chief Operating Officer Robert K. Kretzman Executive Vice President and Chief Administrative Officer Steven Berns Executive Vice President and Chief Financial Officer Mr. Kennedy: Mr. Kennedy was granted 15,000 stock options at an exercise price of $49.60 per share on June 21, 2002. The options vested 25% on each anniversary of the grant date and were fully vested on June 21, 2006. Mr. Kennedy was granted 5,000 stock options at an exercise price of $30.60 per share on April 22, 2003. The options vested 25% on each anniversary of the grant date and were fully vested on April 22, 2007. Mr. Kennedy was granted 13,500 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009. These options expired on March 7, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Ennis: Mr. Ennis was granted 2,000 stock options at an exercise price of $28.80 per share on March 31, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 31, 2009. These options expired on March 31, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Elshaw: Mr. Elshaw was granted 300 options at an exercise price of $39.80 per share on September 4, 2002. The options vested 25% on each anniversary of the grant date and were fully vested on September 4, 2006. Mr. Elshaw was granted 300 stock options at an exercise price of $37.80 per share on September 17, 2002. One-third of these options vested on each anniversary of the grant date and were fully vested on September 17, 2005. Mr. Elshaw was granted 7,000 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009. These options expired on March 7, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Kretzman: Mr. Kretzman was granted 5,000 stock options at an exercise price of $37.80 per share on September 17, 2002. One-third of these options vested on each anniversary of the grant date and were fully vested on September 17, 2005. Mr. Kretzman was granted 12,000 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009. These options expired on March 7, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Kennedy: Mr. Kennedy was granted 84,250 shares of restricted stock on December 8, 2008. As of December 31, 2011, 56,166 of these shares had vested. The remaining 28,084 of these shares vested on January 10, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Ennis: Mr. Ennis was granted 48,600 shares of restricted stock on December 8, 2008. As of December 31, 2011, 32,400 of these shares had vested. The remaining 16,200 of these shares vested on January 10, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Mr. Elshaw was granted 48,600 shares of restricted stock on December 8, 2008. As of December 31, 2011, 32,399 of these shares had vested. The remaining 16,201 of these shares vested on January 10, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Mr. Kretzman was granted 38,600 shares of restricted stock on December 8, 2008. As of December 31, 2011, 25,733 of these shares had vested. The remaining 12,867 of these shares vested on January 10, 2012 (after the December 31, 2011 measurement date in the above table). Mr. Berns: Mr. Berns was granted 25,000 shares of restricted stock on May 18, 2009. As of December 31, 2011, 16,666 of these shares had vested. The remaining 8,334 of these shares vest on July 2, 2012. The following table sets forth the value of restricted stock held by the Named Executive Officers which vested during Name David L. Kennedy Vice Chairman Alan T. Ennis President and Chief Executive Officer Chris Elshaw Executive Vice President and ChiefOperating Officer Robert K. Kretzman Executive Vice President and Chief Administrative Officer Steven Berns Executive Vice President and Chief Financial Officer20102011 Compensation EventsFor 2010, the Company determined to provide merit increases to salaries in March 2010 and to accrue its 2010 bonus program at 100% of target, subject to the Company achieving its 2010 corporate performance goals (i.e., 2010 adjusted EBITDA and free cash flow, as more fully described below).20102011 compensation programs: • Based on the Company’s achievement of 2010 adjusted EBITDA of $260.4 million, representing 96.8% of the Company’s 2010 EBITDA performance goal, and 2010 free cash flow of $82.3 million, representing 110.6% of the Company’s 2010 free cash flow performance goal, in February 2011 the determined,applying the formulae set forth in, and pursuant to the terms and conditions of, the Company’s 2010 incentive compensation programs,2011 Incentive Compensation Programs, determined that such programs would be funded at 100%98% of target, which funding level was below the 105% that could have been authorized for payment under the terms of such programs, based upon aggregate achievement. For 2010, the Company’s incentive compensation programs were comprised of a cash bonus program (the “2010 Bonus Program”) and a cash-based long-term incentive compensation (“LTIP”) program (the “2010 LTIP Program;” together with the 2010 Bonus Program, referred to herein as thetarget.17
As was the case in 2009 and 2010, the Company did not implement an equity award program for 2011. In lieu of equity awards, for 2011 the Compensation Committee approved the 2011 LTIP Program under the Incentive Compensation Plan. In March 2012, the Company paid one-third of the LTIP award earned under its 2011 LTIP Program to eligible employees, including its eligible Named Executive Officers, based upon the Compensation Committee’s certification of the extent of achievement of the performance goals under the 2011 LTIP Program and the 3-year payout terms of such program authorized by the Compensation Committee when it approved the 2011 LTIP Program in October 2010 (i.e., the 2011 LTIP award is paid out in equal one-third amounts in March 2012, 2013 and 2014, provided the Company achieved its performance goals for the performance year and the grantee received a “target” or better performance rating under the Company’s Performance Management Review process for 2011, and provided the grantee remains employed with the Company on the respective payout dates).“2010 Incentive Compensation Programs”), each of which is governed by the terms of the Incentive Compensation Plan.• In March 2011, the Company paid annual cash bonuses under the 2010 Bonus Program to eligible employees, including its eligible Named Executive Officers, based upon the Company’s achievement of its performance goals under such program, and the degree of achievement by bonus program participants of their individual performance objectives for 2010, subject to the terms of such program.• As was the case in 2009, the Company did not implement an equity award program for 2010. In lieu of equity awards, for 2010 the Compensation Committee approved a LTIP component to the Incentive Compensation Plan, which plan was approved by the Company’s stockholders at the 2010 annual stockholders’ meeting. In March 2011, the Company paid one-third of the LTIP award earned under its 2010 LTIP Program to eligible employees, including its eligible Named Executive Officers, based upon the Compensation Committee’s certification of the achievement of the performance goals under the 2010 LTIP Program and the payout terms of such program authorized by the Compensation Committee upon its approval of the 2010 LTIP Program in October 2009 (the 2010 LTIP award is paid out in equal one-third amounts in March 2011, 2012 and 2013, provided the grantee received a “target” or better performance rating under the Company’s Performance Management Review process for 2010 and is employed with the Company on the payout dates).• The Company provided merit salary increases in March 2010, after providing no such increases in 2009.• to pay for performance (by basing salary increases upon individual merit and basing incentive compensation payouts upon the achievement of corporate and individual performance goals and objectives);• to align the interests of management and employees with corporate performance and shareholder interests, by rewarding performance that is directly linked to achieving the Company’s business plan and strategic goals and fostering shareholder value creation over the long term; and• to attract, retain and motivate exceptional performers and key contributors with the skills and experience necessary for the Company to achieve its business objectives, which requires that the Company’s compensation programs be competitive with the compensation practices of other companies, as discussed in further detail below.relatively simple compensation program. This program which consists principally of: (i) base salary; (ii) eligibility for performance-based, annual cash bonuses under the Incentive Compensation Plan, contingent upon the Company achieving specific Company performance goals and participants achieving “target” performance objectives, with exact payouts based upon the extent of achievement by participants of their respective individual performance objectives; and (iii) eligibility for performance-based,participants’participants achieving “target” performance objectives (which elements of compensation are referred to, collectively, in this Proxy Statement, as “total compensation,” unless otherwise noted). Historically, prior to 2009, the Company’s long-term incentive compensation had been comprised of annual equity grants (principally, restricted stockand/or stock options) under the Company’s Stock Plan. However, as with 2009 and 2010, during 20102011 the Company determineddid not to implement an annual equity award program under its Stock Plan. To enable the Company to maintain total compensation at competitive levels, in 2011 the Company granted LTIP awards under its Incentive Compensation Plan.havedid not resultedresult in significant wealth accumulation for the Company’s employees, including its Named Executive Officers. The Company’s annual cash bonus programs wereprogram was accrued and paid at 0%, 50%, 75% and 50% of target, respectively, for 2006, 2007, 2008 and 2009.2009 (as noted in last year’s proxy statement, 2010 was the first year in many years that the Company accrued and paid its annual cash bonus program at 100%). Based on the $9.84$14.87 NYSE closing price of the Company’s Class A Common Stock on December 31, 2010,30, 2011 (i.e., 2011’s last NYSE trading day), all stock options held by the Named Executive Officers were “out of the money,” as the18Compensation and Human Resources departmentsdepartment and the Compensation Committee, with input from the Compensation Committee’s outside compensation consultant, consider the compensation of the Named Executive Officers in order to balance compensation opportunities and reward and retain the Company’s high-performing executives and incent them to maximize their performance in furtherance of the execution of the Company’s business plan.2010,2011, the Company compared the total compensation of its executive officers to market compensation data for certain groups of companies in Towers Watson’s U.S. compensation data banks for similarly situated executives (sometimes referred to herein as “competitive benchmark norms” or “competitive benchmarks,” with such companies being referred to herein as the “Comparison Group”). The Comparison Group for 20102011 consisted of the companies listed onAnnex A.A2010,2011, the incentive compensation-eligible Named Executive Officers’ total compensation, as an approximate percentage of the 50th and the 75th percentiles of total compensation in the relevant Comparison Group, was as follows: (i) 24%67.3% and 13.7%50.7%, respectively, for Mr. Kennedy (Mr.Ennis; (ii) 119.8% and 90.7%, respectively, for Mr. Elshaw; (iii) 88.3% and 73.9%, respectively, for Mr. Berns; and (iv) 123.8% and 95.3%, respectively, for Mr. Kretzman. Mr. Kennedy did not participate in the Company’s 20102011 Incentive Compensation Programs; his base salary for 20102011 was 121.7%115.4% and 83.4%92.5%, respectively, of the 50th and 75th percentiles of base salary in the Comparison Group); (ii) 77.9% and 56.8%, respectively, for Mr. Ennis; (iii) 124% and 86.3%, respectively, for Mr. Elshaw; (iv) 100.7% and 79.6%, respectively, for Mr. Berns; and (v) 149.4% and 100.6%, respectively, for Mr. Kretzman.program(s),programs, which are intended to have the effect of fostering shareholder value creation over the long term, to ensure that the program design appropriately motivates executives to achieve the Company’s financial and operational performance goals, which are designed to be challenging and linked directly to the Company’s business plan for the year. As more fully described below, for 2010, the components of the Company’s incentive compensation program2011 Incentive Compensation Programs were a cash bonus under the 20102011 Annual Bonus Program, payable in March 2011,2012, to the extent performance goals were achieved, and a cash-basedcash LTIP award under the 20102011 LTIP Program, payable in three equal annual installments which began in March 2011,2012, to the extent performance goals were achieved, in three equal annual installments.20102011 Incentive Compensation Programs were contingent upon the achievement of identified corporate performance goals. Additionally, payout to a participant undergoals and, for the 2010 Bonus Program was contingent upon such individual’s achievementindividual, receipt of his or her own individual performance objectives; and, payout to a participant under the 2010 LTIP Program was contingent upon such individual having received a performance rating of “target” or higher under the Company’s 20102011 Performance Management Review process. Additionally, the exact payout to a participant under the 2011 Annual Bonus Program was based upon such individual’s degree of achievement of his or her own individual performance objectives. The Company’s corporate performance goals under the 20102011 Incentive Compensation Programs waswere the Company’s achievement of19$268.9$276 million of “adjusted EBITDA” for 20102011 (the “2010“2011 EBITDA Performance Goal”)1 and $74.4$71 million of “free cash flow” for 20102011 (the “2010“2011 Free Cash Flow Performance Goal”),2 in each case measured after all incentive compensation accruals (collectively, the “2010“2011 Performance Goals”).20102011 Incentive Compensation Programs featured a customary payout curve, to account for the extent to which the Company partially achieved or over achievedoverachieved the Company’s 20102011 Performance Goals.20102011 Annual Bonus Program, depending on the assessment of individual performance, participants could receive between 75% and 150% of their target award, to enable managers (or, in the case of Named Executive Officers, the Compensation Committee) to reward higher-performing employees (including the Named Executive Officers), as long as the overall compensation budget was not exceeded.1 Adjusted EBITDA is a non-GAAP financial measure which the Company defines as income from continuing operations before interest, taxes, depreciation, amortization, gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt and miscellaneous expenses. In calculating adjusted EBITDA, the Company excludes the effects of gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt, results of and gains/losses on discontinued operations and miscellaneous expenses because the Company’s management believes that some of these items may not occur in certain periods, the amounts recognized can vary significantly from period to period and these items do not facilitate an understanding of the Company’s operating performance. 2 Free cash flow is a non-GAAP measure which the Company defines as net cash provided by operating activities, less capital expenditures for property, plant and equipment, plus proceeds from the sale of certain assets. Free cash flow excludes proceeds from the sale of discontinued operations. Free cash flow does not represent the residual cash flow available for discretionary expenditures, as it excludes certain expenditures such as mandatory debt service requirements, which for the Company are significant. 2010,2011, the Named Executive Officers’ objectives included both quantitative financial measures and strategic and operational objectives linked directly to achieving the Company’s business strategy. When assessing the Named Executive Officers’ 20102011 performance, in February 20112012 the Compensation Committee reviewed and analyzed detailed and comprehensive documentary support offor each Named Executive Officer’s accomplishments against his respective 20102011 performance objectives, including the following:• the Company’s 2010 reported financial results, which supported the Company’s achievement of 96.8% of its 2010 EBITDA Performance Goal, on which 35% of Mr. Ennis’ target bonus was based, and 110.6% of its 2010 Free Cash Flow Performance Goal, on which 35% of Mr. Ennis’ target award was based;• the Company’s achievement of an approximate 2.3% increase in net sales, representing partial achievement of this budgeted target, on which 10% of Mr. Ennis’ target award was based;• the execution of the Company’s portfolio planning process and inventory management, on which 10% of Mr. Ennis’ target award was based; and• the continued improvement of the Company’s organizational capabilities through developmental assignments and succession planning, and the implementation of effective performance management processes and line management training, on which 10% of Mr. Ennis’ target award was based.1 Adjusted EBITDA is a non-GAAP financial measure which the Company defines as income from continuing operations before interest, taxes, depreciation, amortization, gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt and miscellaneous expenses. In calculating adjusted EBITDA, the Company excludes the effects of gains/losses on foreign currency fluctuations, gains/losses on the early extinguishment of debt, results of and gains/losses on discontinued operations and miscellaneous expenses because management believes that some2011 reported financial results, which supported the Company’s achievement of these items may not occurapproximately 97% of its 2011 EBITDA Performance Goal, on which 25% of Mr. Ennis’ target award was based, and approximately 105% of its 2011 Free Cash Flow Performance Goal, on which 25% of Mr. Ennis’ target award was based;certain periods, net sales, on which 20% of Mr. Ennis’ target award was based;amounts recognized can vary significantly from period to period and these items do not facilitate an understandingsuccessful implementation of the Company’s operating performance.integrated business planning process and portfolio planning process and the achievement of inventory management objectives, on which 10% of Mr. Ennis’ target award was based;2 Free cash flow isnon-GAAP measureframework for long-range strategic planning, the execution of identified global growth initiatives, the continued evaluation of acquisition opportunities (including, without limitation, the Company’s consummation of the acquisition of the Sinful Colors business in March 2011) and the recruitment of successors for certain senior management positions, on which the Company defines as net cash provided by operating activities, less capital expenditures for property, plant and equipment, plus proceeds from the sale10% of certain assets. Free cash flow excludes proceeds from the sale of discontinued operations. Free cash flow does not represent the residual cash flow available for discretionary expenditures, as it excludes certain expenditures such as mandatory debt service requirements, which for the Company are significant.Mr. Ennis’ target award was based.20• the Company’s 2010 reported financial results, which supported the Company’s achievement of 96.8% of its 2010 EBITDA Performance Goal, on which 35% of Mr. Elshaw’s target bonus was based, and 110.6% of its 2010 Free Cash Flow Performance Goal, on which 35% of Mr. Elshaw’s target award was based;• the Company’s achievement of an approximate 2.3% increase in net sales, representing partial achievement of this budgeted target, on which 10% of Mr. Elshaw’s target award was based;• the execution of the Company’s portfolio planning process and inventory management, on which 10% of Mr. Elshaw’s target award was based; and• the continued improvement of the Company’s organizational capabilities through developmental assignments and succession planning, and the implementation of effective performance management processes and line management training, on which 10% of Mr. Elshaw’s target award was based.• the Company’s 2010 reported financial results, which supported the Company’s achievement of 96.8% of its 2010 EBITDA Performance Goal, on which 25% of Mr. Berns’ target bonus was based, and 110.6% of its 2010 Free Cash Flow Performance Goal, on which 25% of Mr. Berns’ target award was based;• the Company’s achievement of an approximate 2.3% increase in net sales, representing partial achievement of this budgeted target, on which 10% of Mr. Berns’ target award was based;• the execution of the Company’s portfolio planning process and inventory management, on which 10% of Mr. Berns’ target award was based;• the continued improvement of the Company’s organizational capabilities through developmental assignments and succession planning, and the implementation of effective performance management processes and line management training, on which 10% of Mr. Berns’ target award was based; and• the achievement of key functional objectives within the Finance area, including refinancing the Company’s credit facility on terms and conditions to allow the Company to execute its business strategy for growth; improving the financial close process and continuing to strengthen the financial control environment; establishing the operating framework for a functional business continuity plan for all functions; and ensuring that the information management function achieved its 2010 strategic objectives, on which 20% of Mr. Berns’ target award was based. • 2010 reported financial results, which supportedconsummation of the Company’s achievementacquisition of 96.8% of its 2010 EBITDA Performance Goal, on which 25% of Mr. Kretzman’s target bonus was based, and 110.6% of its 2010 Free Cash Flow Performance Goal, on which 25% of Mr. Kretzman’s target award was based;• the Company’s achievement of an approximate 2.3% increaseSinful Colors business in net sales, representing partial achievement of this budgeted target,March 2011), on which 10% of Mr. Kretzman’s target award was based;• the execution of the Company’s portfolio planning process and inventory management, on which 10% of Mr. Kretzman’s target award was based;• the continued improvement of the Company’s organizational capabilities through developmental assignments and succession planning, and the implementation of effective performance management processes and line management training, on which 10% of Mr. Kretzman’s target award was based; and• the achievement of key functional objectives within the Legal and Human Resource areas, including the provision of comprehensive legal services at or below budgeted cost, in support of the Company’s worldwide operations; the leadership of comprehensive succession and development planning, and performance management and line management training, globally; the structuring of competitive health and welfare benefits in the U.S.; and leading the recruitment, hiring and on-boarding of key senior executive positions, on which 20% of Mr. Kretzman’s target award was based.2120102011 Incentive Compensation Programs in his role as Vice Chairman.20102011 Performance Goals, in February 2011,2012, the Compensation Committee, determined,applying the formulae set forth in, and pursuant to the terms and conditions of, the 20102011 Incentive Compensation Programs, determined that such programs would be funded at 100%98% of target. Additionally, in February 2011,2012, based upon a comprehensive review of each Named Executive Officer’s 20102011 performance, the Compensation Committee determined that at least “target” performance had been achieved by each Named Executive Officer and, for exact payout purposes, also determined the extent to which the Named Executive Officers had achieved and in certain cases exceeded their respective individual performance objectives (including, in the case of Messrs. Ennis, Elshaw, Berns and Kretzman, objectives for 20102011 established in compliance with Section 162(m)). Based upon the foregoing determinations, bonuses and LTIP payouts were earned by each of the eligible Named Executive Officers in respect of 20102011 (see the “Summary Compensation Table,” below).20102011 LTIP awards and 20102011 annual cash bonuses) upon compliance with confidentiality, non-competition and non-solicitation obligations.20102011 Annual Bonus Program. As noted above, the bonus objectives for all employees in the 20102011 Annual Bonus Program included the Company’s achievement of two equally weighted performance goals (namely, its 20102011 EBITDA Performance Goal and its 20102011 Free Cash Flow Performance Goal), as well as. Receipt of a bonus award was further conditioned upon the participants’participant’s achievement of theira performance rating of “target” or higher under the Company’s 2011 Performance Management Review process, with the exact payout amount being subject to the degree of achievement of individual performance objectives linked directly to executing the Company’s 20102011 business plan. As approved by the Compensation Committee, under the 20102011 Annual Bonus Program, management (or, in the case of Named Executive Officers, the Compensation CommitteeCommittee) had discretion to award between 75% and 150% of the target bonuses to reward higher-performing, bonus-eligible employees (including the Named Executive Officers), as long as the Company’s overall compensation budget was not exceeded.20102011 for a target bonus of 100% of his base salary, and each of MessrsMessrs. Elshaw, Berns and Kretzman was eligible during 20102011 for a target bonus of 75% of his respective base salary.As noted above (see, “Incentive Compensation; Generally”),based upondegree of achievement of its 2010 Performance Goals,2011 adjusted EBITDA of $266 million and 2011 free cash flow of $74 million, the Compensation Committee, applying the formula set forth in, and pursuant to the terms and conditions of, the 2011 Annual Bonus Program, determined to fund the 2010 Bonus Programsuch program at 100%98% of target, and, based upon its determinations as to the Named Executive Officers’ respective performance ratings and the degree of achievement of their respective performance objectives, awarded Messrs. Ennis, Elshaw, Berns and Kretzman 96.2%100%, 95.7%97%, 100.1% and 106.5% and 103.2%100%, respectively, of their adjusted target bonuses for 2010.actual bonus awardsaward amounts that were madeearned for 2010 to2011 by the Named Executive Officers under the 20102011 Annual Bonus Program.2010)2010 and 2011), the Company decideddid not to implement an annual equity award program under its Stock Plan as a component of long-term compensation. To enable the Company to seek to maintain competitive total compensation, the Company adopted a cash-basedcash LTIP component under its Incentive Compensation Plan, effective from and after 2010. The 20102011 calendar year was the firstsecond performance year under the Company’s newly-implemented LTIP.5060 senior employees, including the Named Executive Officers (other than Mr. Kennedy), were eligible to participate in the 20102011 LTIP Program. Funding of the 20102011 LTIP Program was based on the Company’s degree of achievement of2220102011 EBITDA Performance Goal and its 20102011 Free Cash Flow Performance Goal).20102011 LTIP Program were structured as flat dollar amounts, tiered to levels of responsibility within the organization, and were approved by the Compensation Committee.Committee in December 2010. Once earned, based upon the degree of achievement of the Company’s 20102011 Performance Goals, the award amount is towould be paid out in equal one-third amounts in March 2011,2012, March 20122013 and March 2013,2014, provided the participant received a “target” or better performance rating under the Company’s Performance Management Review process for 20102011 and remains employed with the Company on the applicable payment date. By deferring payments over three years for the 20102011 performance year, the program’s structure is intended to have a retentive element foreffect on the key personnel expected to implement the Company’s business plan from year to year.As noted above (see, “Incentive Compensation; Generally”),Company’s degreeCompensation Committee’s consideration of achievementthe Named Executive Officers’ performance during 2011, the Compensation Committee, applying the formula set forth in, and pursuant to the terms and condition of, its 2010 Performance Goals,the 2011 LTIP Program, determined to fund such program at 98% of target and, accordingly, LTIP awards were earned by each of the eligible Named Executive Officers in respect of 2010.portion of the 20102011 LTIP Program awards that were earned and actually paid out for 2010 to2011 by the eligible Named Executive Officers under the 20102011 LTIP Program.Amount(and,Amount (and, Where Applicable, the Formula) for Each Element of Compensation to Pay and How Each Compensation Element and the Company’s Decisions Regarding that Element Fit into the Company’s Overall Compensation Objectives and May Affect Decisions Regarding Other Elements of Compensation Historically, the Named Executive Officers have not realized any meaningful wealth accumulation from prior equity awards, which influenced the introduction of an LTIP component to the Incentive Compensation Plan to replace the former equity component of compensation.23thosethe performance objectives have been achieved.CompensationHuman Resources Department to recommend: (i) merit increase guidelines based on external benchmarks under the Company’s salary administration program; (ii) the structure of the Company’s annual bonus program under the Incentive Compensation Plan; and (iii) the structure of its long-term incentive compensation programs.2010,2011, the Compensation Committee consulted withand/or considered advice provided by its outside compensation advisor (Compensation Advisory Partners LLC (“CAP”)) with respect to the structure and components of the Company’s incentive compensation programs, as20102011 merit salary increases for the Named Executive Officers.Officers, and the consideration of the compensation of the Company’s Board of Directors. CAP performed no other services for the Company or the Compensation Committee during 20102011 other than providing compensation advice to the Compensation Committee (or to the Company’s CompensationHuman Resources Department in respect to routine compensation survey data analysis); without limiting the foregoing, CAP did not provide services such as benefits administration, human resources consulting or actuarial services. The Compensation Committee approved CAP’s engagement, upon themanagement’s recommendation, of management, and based upon CAP’s experience and qualifications. The Chairman of the Compensation Committee reviews and approves all invoices from the outside compensation consultant prior to payment.20102011 annual bonus and LTIP performance objectives for the Company’s Named Executive Officers were approved under2420102011 and the three other most highly paid executive officers (see footnote (a) below), other than the Chief Executive Officer and the Chief Financial Officer, who served as executive officers of the Company during 20102011 (collectively, the “Named Executive Officers”), for services rendered in all capacities to the Company and its subsidiaries during such periods. As with last year’s proxy statement, the amounts under the columns “Stock Awards” and “Option Awards,” in the Summary Compensation Table below, have been calculated based upon the aggregate grant date fair value of the stock and option awards made during each given fiscal year, if any, in each case as determined in accordance with applicable financial accounting standards (namely, FASB Accounting Standards Codification Topic 718). Historic amounts for 2008 under the columns “Stock Awards” and “Option Awards,” if any, and the corresponding historic amounts in the “Total” column, in the Summary Compensation Table below, have been adjusted and are re-presented in accordance with Item 402 ofRegulation S-K under the Exchange Act. Additionally, as it did last year, the Company is presenting its 2010 annual cash bonus awards under the Revlon Executive Incentive Compensation Plan, as well as its historic presentation of those awards for 2009 and 2008, in theThe “Non-Equity Incentive Plan Compensation” column offor awardspresents bonus and LTIP payments earned under the Incentive Compensation Plan. The 2011 Annual Bonus Program pool and the 2011 LTIP Program were each adjusted downward to, and funded at, 98% of target bonuses foramounts by the year, and any discretionary annual cash bonusCompensation Committee in excess of target bonuses foraccordance with the year in the “Bonus” column. For 2010, such column also includes earned 2010 LTIP Program awards, as more fullyformulae set forth in footnote (d), below (although 2010such programs. Although 2011 LTIP Program awards have been listed in the table below at their full-value, which reflects funding such program at 98% of target for 2011 LTIP awards, only one-third of such amounts washas actually been paid in(in March 2011;2012); the remaining two-thirds of such 20102011 LTIP awards are payable in March 20122013 and March 2013, only2014, if the executive remains employed with the Company on each respective payout date)date, unless provided otherwise in the executive’s employment agreement (see “Employment Agreements and Payments upon Termination and Change of Control”). In all cases, stock option awards outstanding as of December 31, 20102011 were“out-of-the-money, “out-of-the-money,” in that in each case they had exercise prices that were above the $9.84$14.87 per share NYSE closing market price of the Company’s Class A Common Stock on December 31, 201030, 2011 (i.e., 2011’s last NYSE trading day) and therefore had no realizable monetary value to the Named Executive Officers on such date. See “Outstanding Equity Awards at Fiscal Year End.” Change in Pension Value and Nonqualified Non-Equity Deferred Stock Option Incentive Plan Compensation All Other Salary Bonus Awards Awards Compensation Earnings ($) Compensation Total Year ($) ($)(b) ($)(c) ($) ($)(d) (e) ($)(f) ($) David L. Kennedy 2010 614,038 — — — — 23,949 52,984 690,971 2009 867,500 — — — — 101,146 36,447 1,005,093 2008 1,310,000 — 602,388 — 975,000 111,287 40,859 3,039,534 Alan T. Ennis 2010 907,980 — — — 2,075,000 19,557 91,777 3,094,314 2009 781,558 12,500 — — 437,500 56,176 24,063 1,311,797 2008 460,923 30,000 347,490 — 270,000 26,517 22,512 1,157,442 Chris Elshaw 2010 729,346 — — — 1,025,000 5,394 226,382 1,986,122 2009 678,347 12,500 — — 262,500 34,226 192,533 1,180,106 Robert K. Kretzman 2010 740,857 17,716 — — 1,057,284 612,947 77,794 2,506,598 2009 713,783 8,357 — — 266,643 673,313 75,990 1,738,086 2008 711,889 20,036 275,990 — 399,964 311,337 71,972 1,791,188 Steven Berns 2010 448,211 22,125 — — 837,875 18,098 62,393 1,388,702 2009 268,077 10,625 122,750 — 159,375 18,461 18,982 598,270 Year Salary
($) Bonus
($)(b) Stock
Awards
($)(c) Option
Awards
($) Non-Equity
Incentive Plan
Compensation
($)(d) Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings ($)
(e) All Other
Compensation
($)(f) Total
($) 2011 150,000 — — — — 37,933 24,000 211,933 2010 614,038 — — — — 23,949 52,984 690,971 2009 867,500 — — — — 101,146 36,447 1,005,093 2011 910,000 — — — 2,067,800 34,632 65,523 3,077,955 2010 907,980 — — — 2,075,000 19,557 91,777 3,094,314 2009 781,558 12,500 — — 437,500 56,176 24,063 1,311,797 2011 746,355 — — — 1,024,100 8,598 209,697 1,988,750 2010 729,346 — — — 1,025,000 5,394 226,382 1,986,122 2009 678,347 12,500 — — 262,500 34,226 192,533 1,180,106 2011 758,134 — — — 1,049,090 1,309,330 81,810 3,198,364 2010 740,857 17,716 — — 1,057,284 612,947 77,794 2,506,598 2009 713,783 8,357 — — 266,643 673,313 75,990 1,738,086 2011 469,560 227 — — 837,673 42,971 48,797 1,399,228 2010 448,211 22,125 — — 837,875 18,098 62,393 1,388,702 2009 268,077 10,625 122,750 — 159,375 18,461 18,982 598,270 (a) Messrs. Kennedy, Ennis, Elshaw, Kretzman and KretzmanBerns served as the Company’s Named Executive Officers of the Company during 2011, 2010 2009 and 2008.2009. In May 2009, Mr. Berns and Mr. Elshaw became “Named Executive Officers” during 2009,, as Mr. Berns was appointed Executive Vice President and Chief Financial Officer in May 2009 and Mr. Elshaw was appointed25Executive Vice President and Chief Operating Officer, in May 2009; neither of Messrs. Berns or Elshaw served as a “Named Executive Officer” during 2008.and Mr. Kennedy servedtransitioned from serving as the Company’s President and Chief Executive Officer during 2008 and through May 2009, when he transitioned to Vice Chairman of the Board of Directors as part of the Company’s overall succession planning, which included Mr. Ennis succeeding to the positions of President and Chief Executive Officer.Officer (after formerly serving as the Company’s Chief Financial Officer and President, Revlon International).(b) The amounts set forth under the “Bonus” column reflect the portion of the annual bonus awardedamount paid to the Named Executive Officer by the Compensation Committee in excess of such executive’s target bonus for the year, if any, as adjusted for bonus program funding levels based upon performance, pursuant to the Compensation Committee’s authority under the Revlon Executive Incentive Compensation Plan (see “Non-Equity Incentive Plan Compensation” column in this table for target bonuses earned)earned at or below target).(c) As noted above, theThe amounts set forth under the “Stock Awards” column reflect the grant date fair value of restricted shares that were granted to the Named Executive OfficerMr. Berns during the year, based upon the NYSE closing market price of the Company’s Class A Common Stock on the respective grant dates.date.(d) The amounts set forth under the “Non-Equity Incentive Plan Compensation” column reflect the annual targetportion of the bonus awardedamount paid to the Named Executive Officer that was at or below such individual’s target bonus level for the year, as adjusted for bonus program funding levels based upon performance, as awarded by the Compensation Committee for the year, pursuant to its authority under the Revlon Executive Incentive Compensation Plan, based on the achievement of specific performance factors, plus, for 2010 and 2011, the full, 3-year payout value of the executive’s long-term incentive compensation award earned. Note that, although 2010 and 2011 LTIP Program awards have been listed in the table above at their full-valuefull, 3-year payout value per SEC interpretative rules, only one-third of such amount was paid in March 2011 to the executive in respect to 2010; the remaining two-thirds of such 2010the 2011 LTIP award isProgram awards remain payable in March 20122013 and March 2014 and one-third of the 2010 LTIP Program award remains payable in March 2013 onlyto the executive, if the executive remains employed with the Company on each respective payout date.date, unless provided otherwise in the executive’s employment agreement (see “Employment Agreements and Payments upon Termination and Change of Control”). There were no LTIP awards prior to 2010.For Mr. Ennis, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $875,000 in cash bonus plus $1,200,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2010 (the remaining two-thirds of such 2010 LTIP award is to be paid out in equal amounts in March 2012 and March 2013).For Mr. Elshaw, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $525,000 in cash bonus plus $500,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2010 (the remaining two-thirds of such 2010 LTIP award is to be paid out in equal amounts in March 2012 and March 2013).For Mr. Kretzman, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $557,284 in cash bonus plus $500,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2010 (the remaining two-thirds of such 2010 LTIP award is to be paid out in equal amounts in March 2012 and March 2013).For Mr. Berns, the amount set forth under the “Non-Equity Incentive Plan Compensation” column reflects $337,875 in cash bonus plus $500,000 in LTIP, of which LTIP amount only one-third has been paid in respect to 2010 (the remaining two-thirds of such 2010 LTIP award is to be paid out in equal amounts in March 2012 and March 2013).(e) 2010 (the “2010 Form10-K”);2010; and with respect to 2009, the assumptions as set forth in Note 13 to the consolidated financial statements in the Company’s Annual Report onForm 10-K for the year ended December 31, 2009; and, with respect to 2008, the assumptions as set forth in Note 12 to the consolidated financial statements in the Company’s Annual Report onForm 10-K for the year ended December 31, 2008.2009. These amounts have been calculated based on normal retirement age of 65 as specified in the Retirement Plan and Pension Equalization Plan. The Pension Equalization Plan is a non-qualified and unfunded plan. In May 2009, the Company amended the Retirement Plan and the Pension Equalization Plan to cease future benefit accruals under such plans after December 31, 2009. The increase in the respective amounts reflected in the above “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column for each of the Named Executive Officers for 2011 over 2010 was due in principal part to a number of actuarial factors, including (1) changes in the applicable discount rate used to determine the pension obligation which resulted in an increase in the present value of the benefit; (2) a change in the applicable mortality table assumptions used for the actuarial calculation of the pension benefit which also26• For Mr. Kennedy, who has over 8 years of actual service with the Company, this amount includes $5,417, $18,541 and $15,686 under the Retirement Plan and $18,532, $82,605 and $95,601 under the Pension Equalization Plan for 2010, 2009 and 2008, respectively. • For Mr. Ennis, who has over 5 yearsresulted in an increase in the present value of actual service with the Company, this amount includes $8,823, $18,158benefit, and $10,785 under the Retirement Plan and $10,734, $38,018 and $15,732 under the Pension Equalization Plan(3) for 2010, 2009 and 2008, respectively.• For Mr. Elshaw, who has over 9 years of actual service with the Company, this amount includes $2,730 and $12,722 under the Retirement Plan and $2,664 and $21,504 under the Pension Equalization Plan for 2010 and 2009, respectively.• For Mr. Kretzman, who has over 22 years of actual service with the Company, this amount includes $74,057, $117,445 and $50,849 under the Retirement Plan, $227,706, $555,868 and $260,488 under the Pension Equalization Plan, and $311,184 underpursuant to his employment agreement, an additional year of benefit accrual due to an additional year of service. There were no changes made in 2011 to the formulae used for 2010. The pension plans were frozen on December 31, 2009. Mr. Kretzman’s employment agreement provides that he continues to accrue retirement benefits through his retirement date, and that he is entitled to a retirementthe benefit at age 60. The aggregate change in the actuarial present value of Mr. Kretzman’s accumulated benefit calculatedobligations under the Retirement Plan, the Pension Equalization Plan and his employment agreement for 2010 is, respectively, $64,967, $199,758 and $574,108, based on retirement at age 60.actual plans.• For Mr. Berns, who has over 8 years of actual service with the Company (due to credited service during his period of employment with the Company from April 1992 to August 1999), this amount includes $12,529 and $12,781 under the Retirement Plan and $5,569 and $5,680 under the Pension Equalization Plan for 2010 and 2009, respectively.(f) Mr. Kennedy. The amount shown under All Other Compensation for Mr. Kennedy for 20102011 consists of a car allowance; profit sharing contributions; and matching contributions under the 401(k) Plan.Mr. Ennis. The amount shown under All Other Compensation for Mr. Ennis for 2010 consists of a car allowance; tax preparation services; life insurance premiums; profit sharing contributions (including $54,856 of Excess Savings Plan contributions); and matching contributions under the 401(k) Plan.Mr. Elshaw. The amount shown under All Other Compensation for Mr. Elshaw for 2010 consists of $150,000 in housing allowance (as Mr. Elshaw relocated to the U.S. from the U.K. at the Company’s request in connection with his promotion in 2007 to Executive Vice President and General Manager, U.S. Region, prior to his being appointed Executive Vice President and Chief Operating Officer in May 2009); a car allowance; life insurance premiums; profit-sharing contributions (including $37,832 of Excess Savings Plan contributions); and matching contributions under the 401(k) Plan.Mr. Kretzman. The amount shown under All Other Compensation for Mr. Kretzman for 2010 consists of $18,003 in tax gross ups in respect of imputed income arising from use of a Company automobile and life insurance premiums; and other compensation in respect of use of a Company automobile; life insurance premiums; medical plan premiums; tax preparation services; and matching contributions under the 401(k) Plan.Mr. Berns. The amount shown under All Other Compensation for Mr. Berns for 2010 consists of a car allowance; life insurance premiums; tax preparation services and financial counseling; profit sharing contributions; matching contributions under the 401(k) Plan; and health club dues.2010,2011, has an executive employment agreement with Products Corporation.2010).2720102011 would have been approximately $351,230, consisting of the following: (a) two times Mr. Kennedy’s annual base salary on December 31, 20102011 (his base salary on December 31, 20102011 was $150,000); (b) 24 months of life insurance coverage, at a cost of approximately $230; (c) 24 months of group medical and dental insurance coverage, at a total cost of approximately $4,000; (d) 24 months of tax preparation and financial counseling, at a total cost of approximately $17,000; and (e) 24 months of car allowance, at a cost of approximately $30,000. Mr. Kennedy does not currently participate in the Company’s standard group medical and dental plans. Under such circumstances, pursuant to his current employment agreement, Mr. Kennedy would also be entitled to the continued payout, on the respective annual payout dates, as applicable, of the remaining unpaid portion of any outstanding and previously-earned LTIP award. Note that Mr. Kennedy had no outstanding LTIP awards as of December 31, 2011, but, pursuant to his2010)2011), with a target bonus of 100% of his base salary.20102011 would have been approximately $2,789,343,$2,771,143, consisting of the following: (a) two times Mr. Ennis’ annual base salary on December 31, 2010;2011; (b) $910,000,$891,800, representing2820102011 adjusted target bonus; (c) 24 months of life insurance coverage at a cost of approximately $8,343; (d) 24 months of medical and dental insurance coverage, at a total cost of approximately $4,000; (e) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000; and (f) 24 months of car allowance, at a cost of approximately $30,000. Mr. Ennis does not currently participate in the Company’s standard group medical and dental plans. All of Mr. Ennis’ severance payments are conditional on his full compliance with the Company’s comprehensive agreement as to confidentiality and non-competition during any severance period.$731,500$749,056 (which was his base salary as of December 31, 2010)2011), with a target bonus of 75% of his base salary.20102011 would have been approximately $2,047,029,$2,077,382, consisting of the following: (a) two times Mr. Elshaw’s annual base salary on December 31, 2010;2011; (b) $548,625,$550,556, representing Mr. Elshaw’s 20102011 adjusted target bonus; (c) 24 months of life insurance coverage, at a cost of approximately $6,706;$6,844; (d) 24 months of group medical and dental insurance coverage, at a total cost of approximately $15,698;$8,870; and (e) repatriation from the U.S. to the U.K, at a cost of approximately $13,000. All of Mr. Elshaw’s severance payments are conditional on his full compliance with the Company’s comprehensive agreement as to confidentiality and non-competition during any severance period.$743,045$760,878 (which was his base salary as of December 31, 2010)2011), with a target bonus of 75% of his base salary.29previously earnedpreviously-earned LTIP awards would continue to remain payable, in accordance with their terms (in consideration for which, the non-competition covenants referred to in Mr. Kretzman’s employment agreement would remain in effect until the date that all existing equity awards are fully vested and all earned LTIP awards are paid).20102011 would have been approximately $2,204,788,$2,244,496, consisting of the following: (a) two times Mr. Kretzman’s annual base salary on December 31, 2010;2011; (b) $557,284,$559,246, representing his 20102011 adjusted target bonus; (c) 24 months of life insurance coverage, at a cost of approximately $29,104;$29,920; (d) 24 months of medical and dental insurance coverage, at a total cost of approximately $49,298;$51,154; (e) 24 months of use of an automobile, at a cost of approximately $66,012;$65,420; and (f) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000. Under such circumstances, Mr. Kretzman would also be entitled to the continued vesting of his unvested restricted stock (40,734(namely, 12,867 restricted shares were unvested at December 31, 2010 having a fair market value on such date of $400,823$191,332 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date)December 30, 2011 (i.e., stock option awards outstanding2011’s last NYSE trading day), all of which shares vested on December 31, 2010 (all of Mr. Kretzman’s options were“out-of-the-money” on such date and had no realizable monetary value on December 31, 2010)January 10, 2012), and to the fullcontinued payout, on the respective annual payout dates in March 2012, March 2013 and March 2014, as applicable, of the remainderremaining unpaid portion of his $500,000 2010 LTIP award (one-third(two-thirds of which was paid in Marchremained unpaid as of December 31, 2011) and his $490,000 2011 LTIP award (all of which remained unpaid as of December 31, 2011). All of Mr. Kretzman’s stock options were fully vested, and “out-of-the-money,” on December 31, 2011. Mr. Kretzman’s severance payments are conditional on his full compliance with the Company’s comprehensive agreement as to confidentiality and non-competition during any severance period. (his “employment agreement”) provides that Mr. Berns will serve as the Company’s Executive Vice President and Chief Financial Officer, at an annual base salary of not less than $450,500$473,025 (which was his base salary as of December 31, 2010)2011), with a target bonus of 75% of his base salary.3020102011 would have been approximately $1,317,405,$1,375,906, consisting of the following: (a) two times Mr. Berns’ annual base salary on December 31, 2010;2011; (b) $337,875,$347,673, representing Mr. Berns’ 20102011 adjusted target bonus; (c) 24 months of life insurance coverage, at a cost of approximately $4,130;$4,306; (d) 24 months of group medical and dental insurance coverage, at a total cost of approximately $27,400;$30,877; (e) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000; and (f) 24 months of car allowance, at a cost of approximately $30,000. All of Mr. Berns’ severance payments are conditional on his full compliance with the Company’s comprehensive agreement as to confidentiality and non-competition during any severance period.20102011 would have been approximately $1,079,230, consisting of the following: (a) two times his annual base salary on December 31, 2010;2011; (b) two times his5-year average bonus, which average was $355,000 as of December 31, 2010;2011; (c) two years of contributions under the Company’s 401(k) Plan; (d) two years of profit sharing contributions under the Company’s 401(k) Plan; (e) 24 months of life insurance coverage, at a cost of approximately $230; (f) 24 months of group medical and dental insurance coverage, at a total cost of approximately $4,000; (g) 24 months of car allowance at a cost of approximately $30,000; and (h) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000. In addition, under such circumstances, Mr. Kennedy would be entitled to the immediate vesting of his unvested restricted stock (84,001(namely, 28,084 restricted shares were unvested at December 31, 2010 havingwith a fair market value on December 31, 2010 of $826,570$417,609 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date) andDecember 30, 2011 (i.e., 2011’s last NYSE trading day), all of which shares vested on January 10, 2012). All of Mr. Kennedy’s stock option awards outstandingoptions were fully vested, but “out-of-the-money,” on December 31, 2010 (all2011. Upon a “change in control” without the successor entity assuming or otherwise continuing the terms of the LTIP, under his current employment agreement, Mr. Kennedy’s options were“out-of-the-money” onKennedy also would be entitled to the payout of the remaining unpaid portion of his outstanding LTIP awards which have been earned for any prior performance year based upon the Compensation Committee’s determination that the Company had achieved its performance objectives and that the executive had earned a “target” or better performance rating for each such date andyear. Note that Mr. Kennedy had no realizable monetary value onoutstanding LTIP awards as of December 31, 2010).20102011 would have been approximately $2,711,943,$3,054,663, consisting of the following: (a) two times his annual base salary on December 31, 2010;2011; (b) two times his average5-year bonus of $368,000;$539,360; (c) two years of contributions under the Company’s 401(k) Plan; (d) approximately $81,900 in respect31(44,067(namely, 16,200 restricted shares were unvested at December 31, 2010 havingwith a fair market value on December 31, 2010 of $433,619$240,894 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date) andDecember 30, 2011 (i.e., 2011’s last NYSE trading day), all of which shares vested on January 10, 2012). All of Mr. Ennis’ stock option awards outstandingoptions were fully vested, but “out-of-the-money,” on December 31, 2010 (all of Mr. Ennis’ options were“out-of-the-money” on such date and had no realizable monetary value on December 31, 2010).2011. Upon a “change in control” without the successor entity assuming or otherwise continuing the terms of the LTIP, Mr. Ennis also would be entitled to the full payout of the remaining unpaid portion of his $1,200,000 2010 LTIP award (one-third of which was paid in March 2011)2011 and one-third of which was paid in March 2012) and his $1,176,000 2011 LTIP award (one-third of which was paid in March 2012), which was earned for each of 2010 and 2011 based upon the Compensation Committee’s determination that the Company had achieved its 2010 and 2011 performance objectives and that the executive had earned a “target” or better 2010 performance rating.20102011 would have been approximately $2,466,590,$2,550,781, consisting of the following: (a) two times his annual base salary on December 31, 2010;2011; (b) two times his average5-year bonus of $267,325;$369,420; (c) two years of contributions under the Company’s 401(k) Plan; (d) approximately $65,836$67,415 in respect of two years of profit sharing contributions under the 401(k) Plan; (e) 24 months of life insurance coverage, at a cost of approximately $6,706;$6,844; (f) 24 months of group medical and dental insurance coverage, at a total cost of approximately $15,698;$8,870; (g) 24 months of car allowance, at a cost of approximately $30,000; (h) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000; (i) 24 monthsthe remaining contractual period of his housing allowance, at a total cost of approximately $300,000;$150,000; and (j) the cost of two annual trips to the U.K. and airfare to repatriate Mr. Elshaw back to the U.K., as he relocated to the U.S. from the U.K. at the Company’s request in connection with his promotion in 2007 to Executive Vice President and General Manager, U.S. Region, prior to his being appointed Executive Vice President and Chief Operating Officer in May 2009. In addition, under such circumstances, Mr. Elshaw would be entitled to the immediate vesting of his unvested restricted stock (44,268(namely, 16,201 restricted shares were unvested at December 31, 2010 havingwith a fair market value on December 31, 2010 of $435,597$240,909 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date) andDecember 30, 2011 (i.e., 2011’s last NYSE trading day), all of which shares vested on January 10, 2012). All of Mr. Elshaw’s stock option awards outstandingoptions were fully vested, but “out-of-the-money,” on December 31, 2010 (all of Mr. Elshaw’s options were“out-of-the-money” on such date and had no realizable monetary value on December 31, 2010).2011. Upon a “change in control” without the successor entity assuming or otherwise continuing the terms of the LTIP, Mr. Elshaw also would be entitled to the full payout of the remaining unpaid portion of his $500,000 2010 LTIP award (one-third of which was paid in March 2011)2011 and one-third of which was paid in March 2012) and his $490,000 2011 LTIP award (one-third of which was paid in March 2012), which was earned for each of 2010 and 2011 based upon the Compensation Committee’s determination that the Company had achieved its 2010 and 2011 performance objectives and that the executive had earned a “target” or better 2010 performance rating.20102011 would have been approximately $2,657,618,$3,049,286, consisting of the following: (a) two times his annual base salary on December 31, 2010;2011; (b) two times his5-year average bonus of $312,057;$427,418; (c) two years of contributions under the Company’s 401(k) Plan; (d) approximately $371,300$494,500 in respect of two additional years of service credit for purposes of his retirement benefit; (e) 24 months of life insurance coverage at a cost of approximately $29,104;$29,920; (f) 24 months of medical and dental insurance coverage at a total cost of approximately $49,298;$51,154; (g) 24 months of use of a Company automobile at a cost of$66,012;$65,420; and (h) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000. In addition, under such circumstances, Mr. Kretzman would be entitled to the immediate vesting of his unvested restricted stock (40,734(namely, 12,867 restricted shares were unvested at December 31, 2010 with a fair market value of $400,823 on December 31, 2010$191,332 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date) and stock option awards outstanding on December 31, 2010 (all30, 2011 (i.e., 2011’s last NYSE trading day)). All of Mr. Kretzman’s stock options were“out-of-the-money” on such date and had no realizable monetary value fully vested, but “out-of-the-money,” on December 31, 2010).2011. Upon a “change in control” without the successor entity assuming or otherwise continuing the terms of the LTIP, Mr. Kretzman also would be entitled to the full payout of the remaining unpaid portion of his $500,000 2010 LTIP award (one-third of which was paid in March 2011)2011 and one-third of which was paid in March 2012) and his $490,000 2011 LTIP award (one-third of which was paid in March 2012), which was earned for each of 2010 and 2011 based upon the Compensation Committee’s determination that the Company had322010 performance rating.20102011 would have been approximately $1,542,650,$1,670,772, consisting of the following: (a) two times his annual base salary on December 31, 2010;2011; (b) two times his average bonus of $253,937;$292,633; (c) two years of contributions under the Company’s 401(k) Plan; (d) approximately $40,545$42,572 in respect of two years of profit sharing contributions under the 401(k) Plan; (e) 24 months of life insurance coverage, at a cost of approximately $4,130;$4,306; (f) 24 months of group medical and dental insurance coverage, at a total cost of approximately $27,400;$30,877; (g) 24 months of car allowance at a cost of approximately $30,000; and (h) 24 months of tax preparation and financial counseling, at a cost of approximately $17,000. In addition, under such circumstances, Mr. Berns would be entitled to the immediate vesting of his unvested restricted stock (16,667(namely, 8,334 restricted shares were unvested at December 31, 2010 havingwith a fair market value on December 31, 2010 of $164,003$123,927 based on the $9.84$14.87 per share NYSE closing price of the Company’s Class A Common Stock on such date)December 30, 2011 (i.e., 2011’s last NYSE trading day)). Upon a “change in control” without the successor entity assuming or otherwise continuing the terms of the LTIP, Mr. Berns also would be entitled to the full payout of the remaining unpaid portion of his $500,000 2010 LTIP award (one-third of which was paid in March 2011)2011 and one-third of which was paid in March 2012) and his $490,000 2011 LTIP award (one-third of which was paid in March 2012), which was earned for each of 2010 and 2011 based upon the Compensation Committee’s determination that the Company had achieved its 2010 and 2011 performance objectives and that the executive had earned a “target” or better 2010 performance rating.2010,2011, none of the Named Executive Officers received any equity awards from the Company. Pursuant to the 2010 LTIP Program, thethe 2010 performance year2011 under the Revlon Executive2011 Incentive Compensation Plan,Programs, the structure and design of, and performance factors for, which grants are summarized inwere adopted, ratified and approved by the table below. AwardsCompensation Committee pursuant to its authority under the 2010 LTIP ProgramIncentive Compensation Plan. In all cases, amounts earned were structured as flat dollar amounts that could be earnedbased upon the Company’s degree of achievement of the Company’s 2010its 2011 Performance Goals, subjectwhich was reviewed and certified by the Compensation Committee, which also reviewed and made determinations in respect to the grantee achieving at least target performance on his 2010 Performance Management Review. Estimated Future Payout Dates Payouts Under (in Each Case, as to Non-Equity One-Third of Award Effective Incentive Plan Amount, and Subject to Grant Date Awards Continued Employment) Alan Ennis February 2010 $ 1,200,000 March 2011, 2012 & 2013 Chris Elshaw February 2010 $ 500,000 March 2011, 2012 & 2013 Robert Kretzman February 2010 $ 500,000 March 2011, 2012 & 2013 Steven Berns February 2010 $ 500,000 March 2011, 2012 & 2013 PayoutsNamed Executive Officers’ respective achievement of their personal objectives. For amounts actually awarded in respect to grantees2011, see the “Summary Compensation Table,” above, and for additional factors relevant to an understanding of earned awards under the 2010 LTIP Program are to be made in equal one-third amounts over three years, one-third of which was paid in March 2011 withIncentive Compensation Programs, and the remaining two-thirds payable in March 2012below table, see “Compensation Discussion and March 2013, provided the grantee is employed with the Company on the remaining payout dates.33 Estimated Possible Future Payouts Under Non-Equity Incentive Plan Awards 2011 LTIP Program(1) 2011 Annual Bonus Program(2) Threshold Target Maximum LTIP Payout
Dates Threshold Target Maximum (in each case,
as to one-third
of award
amount) $ 0 $ 1,200,000 $ 1,800,000
March 2012,
2013 & 2014
$ 0 $ 910,000 $ 1,365,000 $ 0 $ 500,000 $ 750,000
March 2012,
2013 & 2014
$ 0 $ 561,792 $ 842,688 $ 0 $ 500,000 $ 750,000
March 2012,
2013 & 2014
$ 0 $ 570,659 $ 855,989 $ 0 $ 500,000 $ 750,000
March 2012,
2013 & 2014
$ 0 $ 354,769 $ 532,154 (1) actual amounts awarded are included in the “Summary Compensation Table,” above, in the column titled “Non-Equity Incentive Plan Compensation.” For additional information about the 2011 LTIP Program, see “Compensation Discussion and Analysis,” above. (2) The amounts under this column represent the possible payout under the 2011 Bonus Program under the Incentive Compensation Plan. The amounts shown represent the threshold, target, and maximum payouts for annual cash bonuses under the 2011 Bonus Program with respect to services in 2011, based on performance against pre-established performance measures. The amount under the “Target” column represents the target award opportunity, which is set as a percentage of base salary under the Named Executive Officers’ respective employment agreements. Pursuant to its terms, the 2011 Bonus Program would not be funded, and no award would be payable, if the Company were to achieve less than 85% of its 2011 Performance Goals (represented by the “Threshold” column, above); the 2011 Bonus Program could have been funded at the “Target” level if the Company achieved 100% of its 2011 Performance goals; and the 2011 Bonus Program could have been funded at 150% of the “Target” level for achievement by the Company of 120% of its 2011 Performance Goals (represented by the “Maximum” column, above). In addition, under the 2011 Bonus Program, managers (or, for Named Executive Officers, the Compensation Committee) retained the discretion to award between 75% and 150% of target awards, to reward comparative performance, provided the overall bonus pool was not exceeded. The Compensation Committee determined to fund and pay out 2011 Bonus Program awards at 98% of the “Target” level based on the attainment of 2011 Performance Goals, pursuant to the formula set forth in the 2011 Bonus Program. The actual amounts awarded are included in the “Summary Compensation Table,” above, in the column titled “Non-Equity Incentive Plan Compensation.” For additional information about the 2011 Bonus Program, see “Compensation Discussion and Analysis,” above. 2010.2011. As the $9.84$14.87 per share NYSE closing market price of the Company’s Class A Common Stock on December 31, 201030, 2011 (i.e., the last NYSE trading day during 2011) was lower than the exercise price for all options outstanding on December 31, 2010,2011, all of the stock options held by the Named Executive Officers had no realizable monetary value as of December 31, 2010.2011. The NYSE closing market price of the Company’s Class A Common Stock on the Record Date was $15.28$17.62 per share. All historical share data has been adjusted for the Company’s1-for-10 Reverse Stock Split. Each of the Named Executive Officers exchanged in the Exchange Offer all of their eligible shares of the Company’s Class A Common Stock held by them on October 8, 2009 (the closing date of the Exchange Offer), and received a like number of shares of Series A Preferred Stock. The stock awards listed in the table below reflect restricted shares of Class A Common Stock that vest after the closing date of the Exchange Offer and therefore were not exchanged. Stock Awards Equity Incentive Equity Option Awards Plan Incentive Plan Equity Awards: Awards: �� Incentive Number of Market or Plan Market Unearned Payout Value Awards: Number of Value of Shares, of Unearned Number of Number of Number of Shares or Shares or Units or Shares, Units Securities Securities Securities Units of Units of Other or Other Underlying Underlying Underlying Stock Stock Rights Rights Unexercised Unexercised Unexercised Option That That That That Options (#) Options (#) Unearned Exercise Option Have Not Have Not Have Not Have Not Exercisable Unexercisable Options Price Expiration Vested Vested Vested Vested (a) (a) (#) ($) Date (#) ($)(b) (#) ($) David L. Kennedy 15,000 — — 49.60 6/21/2012 84,001 826,570 — — 5,000 — — 30.60 4/22/2013 149,300 — — 30.30 4/14/2011 13,500 — — 25.50 3/07/2012 Alan T. Ennis 2,000 — — 28.80 3/31/2012 44,067 433,619 — — Chris Elshaw 300 — — 39.80 9/4/2012 44,268 435,597 — — 300 — — 37.80 9/17/2012 16,600 — — 30.30 4/14/2011 7,000 — — 25.50 3/7/2012 Robert K. Kretzman 1,500 — — 56.60 6/18/2011 40,734 400,823 — — 5,000 — — 37.80 9/17/2012 95,500 — — 30.30 4/14/2011 12,000 — — 25.50 3/07/2012 Steven Berns — — — — — 16,667 164,003 — — Option Awards Stock Awards Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
(a) Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
(a) Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) Option
Exercise
Price
($) Option
Expiration
Date Number of
Shares or
Units of
Stock
That
Have Not
Vested
(#) Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(b) 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
($) 15,000 — — 49.60 6/21/2012 28,084 417,609 — — 5,000 — — 30.60 4/22/2013 13,500 — — 25.50 3/07/2012 2,000 — — 28.80 3/31/2012 16,200 240,894 — — 300 — — 39.80 9/4/2012 16,201 240,909 — — 300 — — 37.80 9/17/2012 7,000 — — 25.50 3/7/2012 5,000 — — 37.80 9/17/2012 12,867 191,332 — — 12,000 — — 25.50 3/07/2012 — — — — — 8,334 123,927 — — (a) Grant dates and vesting for options listed in the table are as follows: • • Mr. Kennedy was granted 15,000 stock options at an exercise price of $49.60 per share on June 21, 2002. The options vested 25% on each anniversary of the grant date and were fully vested on June 21, 2006. • Mr. Kennedy was granted 5,000 stock options at an exercise price of $30.60 per share on April 22, 2003. The options vested 25% on each anniversary of the grant date and were fully vested on April 22, 2007. • Mr. Kennedy was granted 149,300 stock options at an exercise price of $30.30 per share on April 14, 2004. The options vested 25% on December 31 of each year and were fully vested on December 31, 2007. These options expired on April 14, 2011 (after the December 31, 2010 measurement date in the above table). • Mr. Kennedy was granted 13,500 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009.34• Mr. Ennis:• Mr. Ennis was granted 2,000 stock options at an exercise price of $28.80 per share on March 31, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 31, 2009.• Mr. Elshaw:• Mr. Elshaw was granted 300 options at an exercise price of $39.80 per share on September 4, 2002. The options vested 25% on each anniversary of the grant date and were fully vested on September 4, 2006.• Mr. Elshaw was granted 300 stock options at an exercise price of $37.80 per share on September 17, 2002. One-third of these options vested on each anniversary of the grant date and were fully vested on September 17, 2005.• Mr. Elshaw was granted 16,600 stock options at an exercise price of $30.30 per share on April 14, 2004. The options vested 25% on December 31 of each year and were fully vested on December 31, 2007. These options expired on April 14, 2011 (after the December 31, 2010 measurement date in the above table).• Mr. Elshaw was granted 7,000 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009.• • Mr. Kretzman was granted 1,500 stock options at an exercise price of $56.60 per share on June 18, 2001. The options vested 25% on each anniversary of the grant date and were fully vested on June 18, 2005.• Mr. Kretzman was granted 5,000 stock options at an exercise price of $37.80 per share on September 17, 2002. One-third of these options vested on each anniversary of the grant date and were fully vested on September 17, 2005.• Mr. Kretzman was granted 95,500 stock options at an exercise price of $30.30 per share on April 14, 2004. The options vested 25% on December 31 of each year and were fully vested on December 31, 2007. These options expired on April 14, 2011 (after the December 31, 2010 measurement date in the above table).• Mr. Kretzman was granted 12,000 stock options at an exercise price of $25.50 per share on March 7, 2005. The options vested 25% on each anniversary of the grant date and were fully vested on March 7, 2009.(b) The market value of the restricted shares identified in the table above is based on the $9.84$14.87 per share NYSE closing market price of the Company’s Class A Common Stock on December 31, 2010.30, 2011 (i.e., 2011’s last NYSE trading day). None of the restricted stock granted to the executives has any dividend rights until vested. • • Mr. Kennedy was granted 83,500 shares of restricted stock on December 10, 2007. As of December 31, 2010, 55,666 of these shares had vested. The remaining 27,834 of these shares vested on January 2, 2011 (after the December 31, 2010 measurement date in the above table). • Kennedy was granted 84,250 shares of restricted stock on December 8, 2008. As of December 31, 2010, 28,083 of these shares had vested. 28,083 of these shares vested on January 10, 2011 (after the December 31, 2010 measurement date in the above table). The remaining 28,084 shares vest on January 10, 2012.Elshaw: • EnnisKretzman: • Mr. Ennis was granted 35,000 shares of restricted stock on December 10, 2007. As of December 31, 2010, 23,333 of these shares had vested. The remaining 11,667 of these shares vested on January 2, 2011 (after the December 31, 2010 measurement date in the above table). • Mr. Ennis was granted 48,600 shares of restricted stock on December 8, 2008. As of December 31, 2010, 16,200 of these shares had vested. 16,200 of these shares vested on January 10, 2011 (after the December 31, 2010 measurement date in the above table). The remaining 16,200 shares vest on January 10, 2012.35• Mr. Elshaw:• Mr. Elshaw was granted 35,600 shares of restricted stock on December 10, 2007. As of December 31, 2010, 23,733 of these shares had vested. The remaining 11,867 of these shares vested on January 2, 2011 (after the December 31, 2010 measurement date in the above table).• Mr. Elshaw was granted 48,600 shares of restricted stock on December 8, 2008. As of December 31, 2010, 16,199 of these shares had vested. 16,200 of these shares vested on January 10, 2011 (after the December 31, 2010 measurement date in the above table). The remaining 16,201 shares vest on January 10, 2012.• Mr. Kretzman:• Mr. Kretzman was granted 45,000 shares of restricted stock on December 10, 2007. As of December 31, 2010, 30,000 of these shares had vested. The remaining 15,000 shares vested on January 2, 2011 (after the December 31, 2010 measurement date in the above table).• Mr. Kretzman was granted 38,600 shares of restricted stock on December 8, 2008. As of December 31, 2010, 12,866 of these shares had vested. 12,867 of these shares vested on January 10, 2011 (after the December 31, 2010 measurement date in the above table). The remaining 12,867 shares vest on January 10, 2012.• • Mr. Berns was granted 25,000 shares of restricted stock on May 18, 2009. As of December 31, 2010, 8,333 of these shares had vested. The remaining shares vest on July 2, 2011 (as to 8,333 shares) and July 2, 2012 (as to 8,334 shares).2010,2011, with the value determined by multiplying the number of shares that vested during 20102011 by the NYSE closing market price of the Company’s Class A Common Stock on the vesting date. None of the Named Executive Officers sold any of their shares of formerly restricted stock that vested during 2010.2011. Option Awards Stock Awards Number of Shares Value Realized Number of Shares Value Realized Acquired on Exercise on Exercise Acquired on Vesting on Vesting (#) ($) (#) ($)(a) David L. Kennedy — — 55,916 951,412 Alan T. Ennis — — 27,867 474,180 Chris Elshaw — — 28,066 477,565 Robert K. Kretzman — — 27,866 474,129 Steven Berns — — 8,333 89,913 Option Awards Stock Awards Number of Shares
Acquired on Exercise
(#) Value Realized
on Exercise
($) Number of Shares
Acquired on Vesting
(#) Value Realized
on Vesting
($)(a) — — 55,917 550,504 — — 27,867 274,373 — — 28,067 276,341 — — 27,867 274,340 — — 8,333 143,911 (a) The aggregate dollar amount realized upon the vesting of restricted shares was computed by multiplying the number of shares of restricted stock that vested during 20102011 by the NYSE closing price of the Company’s Class A Common Stock on the respective vesting dates.36