Preliminary Proxy Statement | ||||
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | ||||
Definitive Proxy Statement | ||||
Definitive Additional Materials | ||||
Soliciting Material Pursuant to (S)240.14a-12 | ||||
HOOKER FURNITURE CORPORATION | ||||
(Name of Registrant as Specified in Its Charter) | ||||
(Name of Person(s) Filing Proxy Statement if other than the Registrant) | ||||
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Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and 0-11. | ||||
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | ||||
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§ | To elect as directors the seven nominees named in the attached proxy statement to serve a one-year term on the Company’s Board of Directors; |
§ | To ratify the selection of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending |
§ | To cast an advisory vote to approve the compensation of the Company’s named executive |
§ | To cast an advisory vote on how frequently the Company should hold advisory votes on compensation of the Company’s named executive officers; and |
§ | To transact such other business as may properly be brought before the meeting or any adjournment of the meeting. |
By Order of the Board of Directors, Robert W. Sherwood Secretary |
§ | delivering a written notice to the Secretary of the Company; |
§ | executing and delivering a later-dated proxy; or |
§ | attending the meeting and voting in person. |
§ | “FOR” the election of the seven director nominees listed on the proxy card; |
§ | “FOR” the ratification of the selection of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending |
§ | “FOR” the approval, on an advisory basis, of the compensation of certain of the Company’s named executive officers as disclosed in this proxy statement; |
§ | For “ONE YEAR” for the frequency of the advisory vote on the compensation of the Company’s named executive officers; and |
§ | In the discretion of the persons named in the proxies upon any other matter(s) that may properly come before the meeting or any adjournment of the meeting. |
§ | the Chairman of the Board of Directors, who also serves as the Company’s Chief Executive Officer, and |
§ | six independent |
§ | identifies, |
§ |
assists the Board with respect to corporate governance matters applicable to the Company; |
§ | evaluates and makes recommendations to the Board regarding the size and composition of the Board; |
§ | develops and recommends criteria for the selection of individuals to be considered as candidates for election to the Board; and |
§ | assists the Board in senior management succession planning. |
§ | possess a reputation for adhering to the highest ethical standards and have demonstrated competence, integrity, and respect for others; |
§ | have demonstrated excellence in leadership, judgment and character; |
§ | have diverse business backgrounds, with a wide range of relevant education, skills and professional experience that will complement and enhance the Company’s business and strategy; and |
§ | have the time to devote to Board and Committee service and are free of potential conflicts of interest. |
§ | the name and address of the shareholder making the recommendation; |
§ | a representation that the shareholder is a record holder of the Company’s Common Stock entitled to vote at the meeting and, if necessary, would appear in person or by proxy at the meeting to nominate the person or persons recommended; |
§ | a description of all arrangements or understandings between the shareholder and the nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the shareholder; |
§ | information regarding the director candidate that would be required to be included in a proxy statement filed under the proxy rules of the United States Securities and Exchange Commission (“SEC”), if the candidate were to be nominated by the Board of Directors; |
§ | information concerning the director candidate’s independence as defined by applicable SEC rules and NASDAQ listing standards; and |
§ | the consent of the director candidate to serve as a director of the Company if nominated and elected. |
§ | approves the appointment of an independent registered public accounting firm to audit the Company’s financial statements and internal control over financial reporting; |
§ | negotiates fees for audit, audit-related and tax services; |
§ | reviews and approves the scope, purpose and type of audit and non-audit services to be performed by the independent registered public accounting firm; |
§ | approves the appointment of the Company’s internal audit service provider, |
§ | oversees the accounting and financial reporting processes of the Company and the integrated audit of the Company’s annual financial statements and internal control over financial reporting. |
§ | management’s critical accounting policies; |
§ | the auditor’s fiscal 2017 integrated audit plan and updates on the completion of the plan; |
§ | the progress of the auditor’s opening balance sheet audit of the newly acquired business of Home Meridian; |
§ | the status of management’s purchase price allocation work related to the Home Meridian acquisition; |
§ | post-acquisition integration efforts; |
§ | compliance with the internal controls required under Section 404 of the Sarbanes-Oxley Act; |
§ | strategy and management of the implementation of the Company’s ERP system in its legacy businesses; and |
§ | the Company’s cybersecurity practices. |
§ | the continued independence of the audit firm; |
§ | the audit firm’s experience and fresh perspective occasioned by mandatory audit partner rotation and the rotation of other audit management; |
§ | the length of time the audit firm has served as the Company’s independent auditors, including the benefits of having a long-tenured auditor and controls and processes that help safeguard the audit firm’s independence; |
§ | whether the audit firm should be rotated and considers the advisability and potential of selecting a different audit firm; |
§ | the appropriateness of the audit firm’s fees; |
§ | evaluations of the audit firm by management; |
§ | the audit firm’s effectiveness of communications and working relationships with the audit committee and management; and |
§ | the quality and depth of the audit firm and the audit team’s expertise and experience in the Company’s industry and related industries in light of the breadth, complexity and global reach of the Company’s business. |
§ | reviewing and approving the Company’s annual operating and capital budgets; |
§ | reviewing the Company’s quarterly and year-to-date operating results and discussing those results with senior management; |
§ | reviewing management’s quarterly risk assessment reports; |
§ | reviewing management and internal audit reports regarding the Company’s internal control over financial reporting; and |
§ | reviewing reports regarding the Company’s internal control over financial reporting from its independent registered public accounting firm. |
§ |
§ |
§ | Stipends for |
§ | the |
§ | if earlier, when the director dies or is disabled, the Annual Meeting following the director’s attainment of age 75, or a change in control of the Company. |
Name | Cash Fees (1) | Stock Awards(2)(3) | Total | |||||||||
W. Christopher Beeler, Jr. | $ | 56,000 | $ | 28,000 | $ | 84,000 | ||||||
John L. Gregory, III | 53,000 | 26,500 | 79,500 | |||||||||
E. Larry Ryder | 48,000 | 24,000 | 72,000 | |||||||||
David G. Sweet | 53,000 | 26,500 | 79,500 | |||||||||
Ellen C. Taaffe | 48,000 | 24,000 | 72,000 | |||||||||
Henry G. Williamson, Jr. | 56,000 | 28,000 | 84,000 |
Name | Cash Fees (1) | Stock Awards(2) | All Other Compensation(3) | Total | ||||||||||||
W. Christopher Beeler, Jr. | $ | 41,500 | $ | 20,750 | $ | 2,340 | $ | 64,590 | ||||||||
John L. Gregory, III | 36,500 | 18,250 | 2,146 | 56,896 | ||||||||||||
E. Larry Ryder | 20,000 | 10,000 | 980 | 30,980 | ||||||||||||
Mark F. Schreiber | 40,500 | 20,250 | 2,184 | 62,934 | ||||||||||||
David G. Sweet | 39,500 | 19,750 | 2,216 | 61,466 | ||||||||||||
Henry G. Williamson, Jr. | 41,500 | 20,750 | 2,357 | 64,607 | ||||||||||||
(1) Includes annual retainer fee, committee membership fees, committee chair fees and lead director fee paid to each director in June 2013, as described in greater detail above. (2) These amounts are the aggregate grant date fair value of shares of restricted stock awarded to each non-employee director on June 7, 2013 under the Company’s Stock Incentive Plan. Fair value is determined in accordance with stock-based compensation accounting standards (Topic 718 of the Accounting Standards Codification). The amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For a discussion of assumptions used in calculating award values, refer to note 12 of the Company’s consolidated financial statements included in the Company’s 2014 Annual Report on Form 10-K. (3) This column shows the aggregate dividends paid to each non-employee director during the fiscal year ended February 2, 2014 with respect to his unvested shares of restricted stock. The non-employee directors held the following number of shares of unvested restricted stock as of February 2, 2014: W. Christopher Beeler, Jr., 5,410; John L. Gregory, III, 4,961; E. Larry Ryder, 2,607; Mark F. Schreiber, 5,077; David G. Sweet, 5,149; Henry G. Williamson, Jr., 5,410. |
(1) | Includes annual retainer fee, committee chair fees and lead director fee paid to each director in June 2016, as described in greater detail above. |
(2) | These amounts are the aggregate grant date fair value of shares of restricted stock awarded to each non-employee director on June 10, 2016 under the Company’s 2015 Stock Incentive Plan. Fair value is determined in accordance with stock-based compensation accounting standards (Topic 718 of the Accounting Standards Codification). The amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For a discussion of assumptions used in calculating award values, refer to note 13 of the Company’s consolidated financial statements included in the Company’s 2017 Annual Report on Form 10-K. |
(3) | As of January 29, 2017, each non-employee director had the following unvested stock awards outstanding: |
Name | Restricted Stock(#) | |||
W. Christopher Beeler, Jr. | 2,624 | |||
John L. Gregory, III | 2,404 | |||
E. Larry Ryder | 2,301 | |||
David G. Sweet | 2,499 | |||
Ellen C. Taaffe | 993 | |||
Henry G. Williamson | 2,624 |
§ | Annual compensation. Base salaries are typically set for each calendar year and the annual cash incentive is set for each fiscal year. The annual cash incentive is determined based on the Company’s financial performance during the current fiscal year. The Compensation Committee sets base salaries and potential annual cash incentive amounts for each executive position based on a number of factors, including competitive market data, responsibilities and individual performance and the Committee members’ business judgment. Base salaries are set for each calendar year based on the individual executive’s performance during the preceding fiscal year. |
§ | Longer-term compensation. Long-term incentives are designed to reward executives if the Company achieves specific performance goals or growth in shareholder value over multi-year periods. The amounts payable to executives under performance incentives vary based on the extent to which the specified goals are achieved or surpassed. The Company has historically granted long-term incentives in the form of performance awards and restricted stock units. |
§ | Full career and time-specific compensation. Supplemental retirement and life insurance benefits are linked to |
§ | Consolidated net income |
§ | Diluted earnings per share |
§ | Annual cash incentive – The Committee approved annual cash incentive increases for Messrs. Toms and Huckfeldt and Ms. Jacobsen, based on an evaluation of the competitiveness of their total compensation to the market, as defined by the modified peer group the Committee adopted earlier in the year. The Company achieved approximately |
§ | Long-Term Incentive Awards – The Company awarded time-based restricted stock units and performance grants to the named executive officers for the |
§ | Base |
§ |
American Woodmark Corporation |
§ | Bassett Furniture Industries, Inc. |
§ | Cavco Industries, Inc. |
§ |
Culp, Inc. |
§ | Dixie Group, Inc. |
§ | Ethan Allen Interiors, Inc. |
§ | Flexsteel Industries, Inc. |
§ | Haverty Furniture Companies, Inc. |
§ |
§ | Lifetime Brands, Inc. |
§ | Nautilus, Inc. |
§ | PGT, Inc. |
§ |
Trex Company, Inc. |
§ | base salary (set on a calendar year basis), |
§ | an annual cash incentive opportunity (based on the Company’s fiscal year financial performance), |
§ | long-term equity-based incentives for each named executive officer, |
§ | supplemental retirement benefits for |
§ | life insurance benefits for one of the named executive officers. |
§ | Historical target payouts for each executive; |
§ | data contained in a Mercer compensation study from a prior fiscal year; |
§ | general business knowledge and experience of the Committee’s members; |
§ | other general compensation information available to the |
§ | the |
If the Company Attained: | ||||||||||||||||||||||||
0-69% of Target Net Income* | 70-84% of Target Net Income* | 85-99% of Target Net Income* | 100-124% of Target Net Income* | 125-149% of Target Net Income* | 150%+ of Target Net Income* | |||||||||||||||||||
Paul B. Toms, Jr. | 0 | % | 30.0 | % | 45.0 | % | 60.0 | % | 80.0 | % | 100.0 | % | ||||||||||||
Paul A. Huckfeldt | 0 | % | 23.0 | % | 34.0 | % | 45.0 | % | 60.0 | % | 75.0 | % | ||||||||||||
George Revington | 0 | % | 23.0 | % | 34.0 | % | 45.0 | % | 60.0 | % | 75.0 | % | ||||||||||||
Anne M. Jacobsen | 0 | % | 23.0 | % | 34.0 | % | 45.0 | % | 60.0 | % | 75.0 | % | ||||||||||||
Michael W. Delgatti, Jr. | 0 | % | 23.0 | % | 34.0 | % | 45.0 | % | 60.0 | % | 75.0 | % |
If the Company Attained: | ||||||||||||||||||||
70% of Target Net Income | 85% of Target Net Income | 100% of Target Net Income | 125% of Target Net Income | 150% of Target Net Income | ||||||||||||||||
Paul B. Toms, Jr. | 25.0 | % | 37.5 | % | 50.0 | % | 66.5 | % | 83.5 | % | ||||||||||
Paul A. Huckfeldt | 20.0 | % | 30.0 | % | 40.0 | % | 53.2 | % | 66.8 | % | ||||||||||
Alan D. Cole | 25.0 | % | 37.5 | % | 50.0 | % | 66.5 | % | 83.5 | % | ||||||||||
Michael W. Delgatti, Jr. | 17.5 | % | 26.3 | % | 35.0 | % | 46.6 | % | 58.5 | % |
Name | Fiscal 2017 Annual Cash Incentive Earned | |||
Paul B. Toms, Jr. | $ | 186,750 | ||
Paul A. Huckfeldt | 84,375 | |||
George Revington | 180,000 | |||
Anne M. Jacobsen | 67,500 | |||
Michael W. Delgatti, Jr. | 101,250 |
Name | 2014 Annual Cash Incentive Earned | |||
Paul B. Toms, Jr. | $ | 138,750 | ||
Paul A. Huckfeldt | 64,350 | |||
Michael W. Delgatti, Jr. | 69,560 | |||
Alan D. Cole | 124,875 |
Payout Amount Based on EPS Growth (%) for Performance Period | ||||||||||||||||||||
Executive Officer | 5% | 10% | 15% | 20% | 25% | |||||||||||||||
Paul B. Toms, Jr. | $ | 31,125 | $ | 93,375 | $ | 124,500 | $ | 155,625 | $ | 186,750 | ||||||||||
Paul A. Huckfeldt | 15,000 | 45,000 | 60,000 | 75,000 | 90,000 | |||||||||||||||
George Revington | 20,004 | 60,012 | 80,016 | 100,020 | 120,024 | |||||||||||||||
Anne M. Jacobsen | 12,000 | 36,000 | 48,000 | 60,000 | 72,000 | |||||||||||||||
Michael W. Delgatti, Jr. | 15,003 | 45,009 | 60,012 | 75,015 | 90,018 |
Payout Amount Based on Relative EPS Growth for Performance Period | ||||||||||||
Executive Officer | Less than 50th percentile | 50th percentile, but less than 75th percentile | Equal to or greater than 75th percentile | |||||||||
Paul B. Toms, Jr. | $ | 0 | $ | 124,500 | $ | 186,750 | ||||||
Paul A. Huckfeldt | 0 | 60,000 | 90,000 | |||||||||
George Revington | 0 | 79,992 | 119,988 | |||||||||
Anne M. Jacobsen | 0 | 48,000 | 72,000 | |||||||||
Michael W. Delgatti, Jr. | 0 | 59,994 | 89,991 |
Executive Officer | Number of RSUs | |||
Paul B. Toms, Jr. | 0 | |||
Paul A. Huckfeldt | 1,179 | |||
George Revington | 3,143 | |||
Anne M. Jacobsen | 943 | |||
Michael W. Delgatti, Jr. | 2,357 |
1. | Accounting Restatement. If the Company is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirement under the federal securities laws, the Company will recover from any current or former officer who received any incentive compensation during the 3-year period preceding the date on which the Company is required to prepare an accounting restatement based on the erroneous data, that amount of the incentive compensation that is in excess of what would have been paid to the current or former executive officer under the accounting restatement. |
2. | Material Error in Compensation Measure. If the Board determines that there was a material error in any measure (whether quantitative or qualitative) on which incentive compensation was granted, earned or paid and such error resulted in an excess amount over the amount of incentive compensation that should have been granted, earned or paid to an employee or former employee during the three-consecutive-year period ending on the date on which such material error is discovered, the Board may require reimbursement of the excess amount, or cancellation of outstanding equity awards and reimbursement of any gains realized on the exercise, settlement or sale of equity awards, to the extent attributable to the excess amount. |
3. | Fraudulent or Intentional Misconduct. If the Board determines that any current or former employee of the Company has engaged in fraudulent or intentional misconduct materially affecting the Company’s business operations or such employee’s duties at the Company, the Board shall direct the Company to require reimbursement of compensation granted, earned or paid under the Company annual incentive and long-term incentive cash plans to such current or former employee and cancellation of outstanding equity awards and reimbursement of any gains realized on the exercise, settlement or sale of equity awards held by such current or former employee, in either case which has been granted or paid to or earned or realized by the current or former employee at any time during the three-consecutive year period ending on the date on which such fraudulent or intentional misconduct is discovered. |
§ | the Committee has authority under the Company’s Incentive Compensation Recoupment, or “clawback”, policy to pursue recovery of excess incentive compensation paid to executives as a result of: |
§ | an accounting restatement; |
§ | a material error in a compensation measure; and/or |
§ | fraudulent or intentional misconduct. |
§ | the Committee has the unlimited authority to reduce long-term performance grant awards or pay no award at all; |
§ | long-term performance grants have been performance-based, which aligns compensation with |
§ | overall compensation is balanced between fixed and variable pay, and variable pay is linked to annual performance |
§ | the fixed compensation provided under our SRIP to certain executive officers helps avoid the potential for excess leverage and allows for longer service conditions than typical variable pay arrangements, thereby enhancing retention and management continuity; |
§ | the multi-year cliff-vesting feature of restricted stock units promotes long-term retention, helps to mitigate inappropriate short-term risk taking and helps to align management and shareholder interests; |
§ | profitability goals, which serve as inputs for variable annual cash incentive compensation and long-term performance grants, are not unduly aggressive; |
§ | the long-term performance grants have been based on cumulative absolute and relative EPS growth over multi-year periods, which helps reduce the potential for short-term focus at the expense of longer-term growth; |
§ | a consistent compensation philosophy has been applied year-over-year and does not change significantly with short-term changes in business conditions; |
§ | open dialogue among management, the Committee and the Board regarding executive compensation policies and practices and the appropriate incentives to use in achieving short-term and long-term performance targets; and |
§ | other general risk mitigating factors, including: |
quarterly reviews of the Company’s results of operations and financial condition; |
quarterly review of management’s periodic risk assessment report; |
review of management’s compensation risk report; |
executive sessions at all committee meetings, including executive session with the Company’s independent auditor; and |
a fairly flat organizational structure, which promotes knowledge sharing and risk awareness by members of senior management. |
Name and Principal Position | Year | Salary ($)(2) | Bonus ($) | Stock Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | Change in Pension Value and Non- Qualified Deferred Compensation Earnings ($)(5) | All Other Compensation ($)(6) | Total ($) | |||||||||||||||||||||||
Paul B. Toms, Jr., Chairman and CEO | 2017 2016 2015 | 407,500 370,000 370,000 | $ | 249,000 222,000 222,000 | $ | 186,750 185,000 185,000 | $ | 475,265 259,246 420,501 | $ | 41,244 41,139 46,960 | $ | 1,359,759 1,077,385 1,244,461 | |||||||||||||||||||
Paul A. Huckfeldt, CFO and Sr. VP Fin. and Acctg. | 2017 2016 2015 | 244,023 214,500 214,500 | 148,603 127,068 126,528 | 84,375 85,800 85,800 | 100,405 47,880 95,158 | 9,530 9,865 9,116 | 586,936 485,113 531,102 | ||||||||||||||||||||||||
George Revington, COO(1) | 2017 | 396,923 | 236,257 | 180,000 | - | 13,083 | 826,263 | ||||||||||||||||||||||||
Anne M. Jacobsen, Senior Vice President- Administration | 2017 2016 2015 | 200,000 177,083 175,000 | 118,877 86,381 86,023 | 67,500 70,000 70,000 | 55,065 25,257 47,140 | 10,127 9,163 7,946 | 451,569 367,884 386,109 | ||||||||||||||||||||||||
Michael W. Delgatti, Jr., President-Hooker Furniture (legacy) | 2017 2016 2015 | 300,000 300,000 300,000 | 177,187 176,193 174,937 | 101,250 135,000 135,000 | - - - | 9,284 9,865 9,162 | 587,721 621,058 619,099 |
(1) | Mr. Revington’s employment began on February 1, 2016, the first day of the Company’s 2017 fiscal year, concurrent with the acquisition of the business of Home Meridian International, Inc. |
(2) | Amounts shown represent base salary paid during the fiscal year. Annual base salary adjustments generally become effective at the beginning of each calendar year and do not coincide with the beginning of a fiscal year. |
For Mr. Toms, this amount is the grant date fair value of the three-year performance grant that was awarded to him in fiscal 2017. For the other named executives, this amount is the sum of the grant date fair value of (a) the restricted stock units and (b) three-year performance grants that were awarded to the named executive officers in fiscal 2017. The |
statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 29, 2017 (the “2017 Form 10-K”), as filed with the SEC. |
(4) | This column shows amounts earned under the annual cash |
This column shows the change in the present value of the named executive officer’s accumulated benefit under the Supplemental Retirement Income Plan (“SRIP”) at the earliest full benefit retirement age. |
Name | Fiscal 2013 Value | Fiscal 2014 Value | Increase in SRIP Value | |||||||||
Paul B. Toms, Jr. | $ | 958,397 | $ | 1,059,623 | $ | 101,226 | ||||||
Paul A. Huckfeldt | 118,138 | 158,338 | 40,200 |
All Other Compensation for fiscal year |
Name | ELIP | Disability Income Insurance Premium Reimbursement | 401(k) Match | Total | ELIP | Disability Income Insurance Premium Reimbursement | 401(k) Match | Total | ||||||||||||||||||||||||
Paul B. Toms, Jr. | $ | 46,300 | $ | 590 | $ | 7,971 | $ | 54,861 | $ | 30,461 | $ | 688 | $ | 10,094 | $ | 41,244 | ||||||||||||||||
Paul A Huckfeldt | - | 566 | 8,497 | 9,062 | ||||||||||||||||||||||||||||
Paul A. Huckfeldt | - | 688 | 8,842 | 9,530 | ||||||||||||||||||||||||||||
George Revington | - | - | 13,083 | 13,083 | ||||||||||||||||||||||||||||
Anne M. Jacobsen | - | 655 | 9,472 | 10,127 | ||||||||||||||||||||||||||||
Michael W. Delgatti, Jr. | - | 590 | 8,171 | 8,761 | - | 688 | 8,596 | 9,284 | ||||||||||||||||||||||||
Alan D. Cole | - | 590 | 7,185 | 7,775 |
Name | Award Type | Grant Date for Equity Incentive Plan and Stock Awards | Estimated Possible Payouts Under Non- Equity Incentive Plan Awards(1) | Estimated Future Payouts Under Equity Incentive Plan Awards (2) | All Other Stock Awards: Number of Units (3) | Grant Date Fair Value of Stock Awards ($) | ||||||||||||||||||||||||||||||
Threshold ($) | Target($) | Maximum ($) | Threshold ($) | Target ($) | Maximum ($) | |||||||||||||||||||||||||||||||
Paul B. Toms, Jr. | Annual Cash Incentive | $ | 124,500 | $ | 249,000 | $ | 415,830 | |||||||||||||||||||||||||||||
Performance Grant | 4/13/16 | $ | 31,125 | $ | 249,000 | $ | 373,500 | $ | 249,000 | (4) | ||||||||||||||||||||||||||
Paul A. Huckfeldt | Annual Cash Incentive | 56,250 | 112,500 | 187,875 | ||||||||||||||||||||||||||||||||
Performance Grant | 4/13/16 | 15,000 | 120,000 | 180,000 | 120,000 | (4) | ||||||||||||||||||||||||||||||
RSU Grant | 4/13/16 | 1,179 | 28,603 | (5) | ||||||||||||||||||||||||||||||||
George Revington | Annual Cash Incentive | 90,000 | 180,000 | 300,600 | ||||||||||||||||||||||||||||||||
Performance Grant | 4/13/16 | 20,004 | 160,008 | 240,012 | 160,008 | (4) | ||||||||||||||||||||||||||||||
RSU Grant | 4/13/16 | 3,143 | 76,249 | (5) | ||||||||||||||||||||||||||||||||
Anne M. Jacobsen | Annual Cash Incentive | 45,000 | 90,000 | 150,300 | ||||||||||||||||||||||||||||||||
Performance Grant | 4/13/16 | 12,000 | 96,000 | 144,000 | 96,000 | (4) | ||||||||||||||||||||||||||||||
RSU Grant | 4/13/16 | 943 | 22,877 | (5) | ||||||||||||||||||||||||||||||||
Michael W. Delgatti, Jr. | Annual Cash Incentive | 67,500 | 135,000 | 225,450 | ||||||||||||||||||||||||||||||||
Performance Grant | 4/13/16 | 15,003 | 120,006 | 180,009 | 120,006 | (4) | ||||||||||||||||||||||||||||||
RSU Grant | 4/13/16 | 2,357 | 57,181 | (5) |
Grants of Plan-Based Awards | ||||||||||||
Estimated Possible Payouts Under Non- Equity Incentive Plan Awards(1) | ||||||||||||
Name | Threshold ($) | Target($) | Maximum($) | |||||||||
Paul B. Toms, Jr. | $ | 92,500 | $ | 185,000 | $ | 310,800 | ||||||
Paul A. Huckfeldt | 39,000 | 78,000 | 130,650 | |||||||||
Michael W. Delgatti, Jr. | 47,700 | 92,750 | 153,700 | |||||||||
Alan D. Cole | 83,250 | 166,500 | 279,720 |
(1) | Represents the estimated |
(2) | Represents the estimated future payouts under the performance grants awarded to the named executive officers in fiscal 2017. For additional discussion regarding these performance grants, refer to Compensation Discussion and Analysis, which begins on page 14, including Long-Term Performance Incentive on page 21 and the Summary Compensation Table on page 28. |
(3) | This is the number of service-based RSUs granted to the named executive officer. Each RSU entitles the named executive to receive one share of the Company’s common stock (or, at the discretion of the Committee cash based on the fair market value of a share of the Company’s common stock on the date payment is made or both) if he remains continuously employed with the Company through the end of three-year service periods that end April 13, 2019. In addition to the service-based vesting requirement, 100% of an executive officer’s RSUs will vest upon a change of control of the Company and a prorated number of the RSUs will vest upon the death, disability or retirement of the executive officer. |
(4) | Represents the three-year performance grants that were awarded to the named executive officers in fiscal 2017. The three-year performance grants shown were computed assuming that the probable level of performance would be achieved (15% EPS growth and relative EPS growth at the 50th percentile for the performance period) and excluded the impact of estimated forfeitures related to service-based vesting conditions. |
(5) | The grant date fair value of each RSU is based on the market price of the Company’s common stock on the grant date, reduced by the present value of the dividends expected to be paid on the shares during the service period, discounted at the appropriate risk-free rate of return. For more information concerning the calculation of performance grant fair values, refer to note 13 of the Company’s consolidated financial statements included in the Company’s 2017 Form 10-K. |
Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested(#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(3) | ||||||||||
Paul B. Toms, Jr. | 4/15/14(1) 4/6/15(1) 4/13/16(1) | - - - | - - - | 277,500 111,000 31,125 | ||||||||||
Paul A. Huckfeldt | 4/15/14(1) 4/15/14(2) 4/6/15(1) 4/6/15(2) 4/13/16(1) 4/13/16(2) | - 1,826 - 1,376 - 1,179 | - 61,993 - 46,715 - 40,027 | 128,700 - 51,480 - 15,000 - | ||||||||||
George Revington(4) | 4/13/16(1) 4/13/16(2) | - 3,143 | - 106,705 | 20,001 - | ||||||||||
Anne M. Jacobsen | 4/15/14(1) 4/15/14(2) 4/6/15(1) 4/6/15(2) 4/13/16(1) 4/13/16(2) | - 1,241 - 935 - 943 | - 42,132 - 31,743 - 32,015 | 87,500 - 35,000 - 12,000 - | ||||||||||
Michael W. Delgatti, Jr. | 4/15/14(1) 4/15/14(2) 4/6/15(1) 4/6/15(2) 4/13/16(1) 4/13/16(2) | - 4,255 - 3,207 - 2,357 | - 144,457 - 108,878 - 80,020 | 150,008 - 60,003 - 15,000 - |
(1) | Performance grant awards outstanding |
(2) | Restricted stock |
(i.e., |
(3) | The amount reported for the 2015 performance grant award is based on the actual level of absolute and relative EPS growth achieved as of the end of the 2017 fiscal year, which was the end of the award’s three-year performance period. The amount reported for the 2016 and 2017 performance grant awards is based on the level of performance achieved as of the end of the 2017 fiscal year, even though actual performance will not be measured under each of those awards until the end of their respective three-year performance periods. If the interim performance exceeded the threshold for the award, the reported value of the award was based on assumed achievement of the next higher performance measure that exceeds the actual interim measure of performance (which was the maximum performance level for both absolute and relative EPS growth). Any payments under the 2016 and 2017 performance grant awards will be determined based on actual performance through 2019 and 2020, respectively, and not on any interim measure of performance. |
Name | Plan Name | Present Value of Accumulated Benefit ($)(1) | Plan Name | Present Value of Accumulated Benefit ($)(1) | ||||||||
Paul B. Toms, Jr. | SRIP | $ | 1,059,623 | SRIP | $ | 2,214,635 | ||||||
Paul A. Huckfeldt | SRIP | 158,338 | SRIP | 401,781 | ||||||||
(1) Assumes a discount rate of 4.5%, based on the Moody’s Composite Bond Rate as of January 31, 2014 (rounded to the nearest 25 basis points). | ||||||||||||
Anne M. Jacobsen | SRIP | 195,109 | ||||||||||
(1) Assumes a discount rate of 4.0%, based on the Moody’s Composite Bond Rate as of January 31, 2017 (rounded to the nearest 25 basis points). | (1) Assumes a discount rate of 4.0%, based on the Moody’s Composite Bond Rate as of January 31, 2017 (rounded to the nearest 25 basis points). |
§ | acquisition, other than from the Company, of more than 50% of the outstanding shares or the combined voting power, of the Company’s Common Stock; or |
§ | a majority of members of the Board is replaced during a twelve-consecutive-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election. |
Name | Change in Control – SRIP (1) | |||
Paul B. Toms, Jr. | $ | 1,761,757 | ||
Paul A. Huckfeldt | 349,438 | |||
(1) Calculated based on historical average salary and bonus amounts for the five-year period ended February 2, 2014 and assuming a discount rate equal to 120% of the short-term (0.30%), mid-term (2.09%) or long-term (4.15%) applicable federal rate for the month of January 2014 depending on the number of years remaining to the participant’s retirement at age 65. |
Name | Change in Control – SRIP (1) | |||
Paul B. Toms, Jr. | $ | 2,857,271 | ||
Paul A. Huckfeldt | 678,781 | |||
Anne M. Jacobsen | 466,523 | |||
(1) Calculated based on historical average salary and bonus amounts for the five-year period ended January 31, 2017 and assuming a discount rate equal to 120% of the short-term (1.15%), mid-term (2.35%) or long-term (3.28%) applicable federal rate for the month of January 2017 depending on the number of years remaining to the participant’s retirement at age 65. |
§ |
§ |
§ | on or after the occurrence of the change of control, the participant’s employment is terminated involuntarily or constructively terminated without cause. |
Payout under Performance Grants ($)(1) | Payout under Performance Grants ($)(1) | |||||||||||||||
Name | Change of Control | Death, Disability or Retirement | Change of Control | Death, Disability or Retirement | ||||||||||||
Paul B. Toms, Jr. | $ | 438,000 | $ | 72,000 | $ | 693,000 | $ | 452,769 | ||||||||
Paul A. Huckfeldt | 184,800 | 30,400 | 325,920 | 211,491 | ||||||||||||
Alan D. Cole | 263,233 | 43,342 | ||||||||||||||
George Revington | 160,008 | 53,283 | ||||||||||||||
Anne M. Jacobsen | 236,000 | 231,898 | ||||||||||||||
Michael W. Delgatti, Jr. | 171,688 | 27,783 | 360,018 | 239,892 | ||||||||||||
(1) These amounts include the amounts payable under three-year performance grants awarded February 9, 2012 and January 15, 2013, which are described in the Outstanding Equity Awards at Fiscal Year-End table on page 23. The payout amounts in connection with an executive’s death, disability or retirement assume that the probable level of performance is achieved for the applicable performance periods. |
(1) | These amounts include the amounts payable under three-year performance grants awarded April 15, 2014, April 6, 2015 and April 13, 2016 which are described in the Outstanding Equity Awards at Fiscal Year-End table on page 32. The payout amounts in connection with an executive’s death, disability or retirement assume that the probable level of performance is achieved for the applicable performance periods. |
Payout under Restricted Stock Units Upon ($)(1) | Payout under Restricted Stock Units Upon ($)(1) | |||||||||||||||
Name | Change of Control | Death, Disability or Retirement | Change of Control | Death, Disability or Retirement | ||||||||||||
Paul B. Toms, Jr. | $ | - | $ | - | $ | - | $ | - | ||||||||
Paul A. Huckfeldt | 50,162 | 8,753 | 148,735 | 106,034 | ||||||||||||
George Revington | 106,705 | 35,213 | ||||||||||||||
Anne M. Jacobsen | 105,890 | 73,647 | ||||||||||||||
Michael W. Delgatti, Jr. | 93,097 | 15,998 | 333,355 | 242,723 | ||||||||||||
Alan D. Cole | 142,865 | 24,952 | ||||||||||||||
(1) These amounts include the amounts payable under three-year RSUs awarded February 9, 2012 and January 15, 2013, which are described in the Outstanding Equity Awards at Fiscal Year-End table on page 23, and are calculated based on the closing price of the Company’s Common Stock as of the last day of fiscal 2014. |
(1) | These amounts include the amounts payable under three-year RSUs awarded April 15, 2014, April 6, 2015 and April 13, 2016 which are described in the Outstanding Equity Awards at Fiscal Year-End table on page 32, and are calculated based on the closing price of the Company’s Common Stock as of the last trading day of fiscal 2017. |
Name | Death or Termination Upon Disability(1) | |||
Michael W. Delgatti, Jr. | $ | 161,863 | ||
(1) Amount calculated based on the closing price of the Company’s Common Stock as of the last day of fiscal 2014. |
· | fraud, theft or embezzlement against the Company or any of its affiliates; |
· | misconduct in the performance of his duties injurious to the business or reputation of the Company or any of its affiliates; |
· | conviction of, or entry of a plea of guilty or nolo contendere to, a crime that constitutes a felony or other crime involving dishonesty or moral turpitude; |
· | his breach of any restrictions imposed on him under the agreement, violation of any policy, code or standard of ethics generally applicable to employees of the Company, or material breach of fiduciary duties owed to the Company; or |
· | his refusal to perform or gross neglect of the duties assigned to him. |
§ | fraud, dishonesty, theft, embezzlement or misconduct injurious to the Company or any of its affiliates; |
§ | conviction of, or entry of a plea of guilty or nolo contendere to, a crime that constitutes a felony or other crime involving moral turpitude; |
§ | competition with the Company or any of its affiliates; |
§ | unauthorized use of any trade secrets of the Company or any of its affiliates or confidential information (as defined in the agreement); |
§ | violation of any policy, code or standard of ethics generally applicable to the Company’s employees; |
§ | a material breach of fiduciary duties owed to the Company; |
§ | excessive and unexcused absenteeism unrelated to a disability; or |
§ | after written notice and a reasonable opportunity to cure, gross neglect of assigned duties. |
Name | Termination Without Cause (1) | |||
Alan D. Cole | $ | 333,000 | ||
(1) All amounts are calculated based on Mr. Cole’s annual salary of $333,000 as of the last day of fiscal 2014. |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans | |||||||||
Equity compensation plans approved by security holders (1) | 0 | N/A | 655,126 | |||||||||
Equity compensation plans not approved by security holders | None | None | None | |||||||||
Total | 0 | N/A | 655,126 |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Approximate number of securities remaining available for future issuance under equity compensation plans(1) | |||||||||
Equity compensation plans approved by security holders | 0 | N/A | 564,000 | |||||||||
Equity compensation plans not approved by security holders | None | None | None | |||||||||
Total | 0 | N/A | 564,000 |
(1) | Shares allocable to incentive awards granted under the Company’s 2015 Stock Incentive Plan that expire, are forfeited, lapse or are otherwise terminated or cancelled are added to the shares available for incentive awards under the plan. Any shares covered by a stock appreciation right are counted as used only to the extent shares are actually issued to a participant when the stock appreciation right is exercised. Any shares retained by the Company in satisfaction of a participant’s obligation to pay applicable withholding taxes with respect to any incentive award and any shares covered by an incentive award that is settled in cash are added to the shares available for incentive awards under the plan. |
§ | each shareholder known by the Company to be the beneficial owner of more than 5% of its outstanding Common Stock; |
§ | each director and director nominee; |
§ | each named executive officer; and |
all directors and executive officers as a group. |
Name | Amount and Nature Of Beneficial Ownership | Percent Of Class | ||||||
Royce & Associates, LLC (1) | 1,722,858 | (1) | 14.9 | % | ||||
NWQ Investment Management Company, LLC (2) | 1,161,285 | (2) | 10.0 | |||||
Dimensional Fund Advisors LP (3) | 978,752 | (3) | 8.4 | |||||
BlackRock, Inc. (4) | 701,622 | (4) | 6.1 | |||||
Paul B. Toms, Jr. | 123,923 | (5) | 1.1 | |||||
George Revington | 55,251 | (6) | * | |||||
W. Christopher Beeler, Jr. | 30,660 | (7) | * | |||||
Henry G. Williamson, Jr. | 29,094 | (8) | * | |||||
Michael W. Delgatti, Jr. | 26,978 | (9) | * | |||||
E. Larry Ryder | 22,479 | (10) | * | |||||
John L. Gregory, III | 16,605 | (11) | * | |||||
Paul A. Huckfeldt | 12,438 | (12) | * | |||||
David G. Sweet | 11,997 | (13) | * | |||||
Anne M. Jacobsen | 4,889 | (14) | * | |||||
Ellen C. Taaffe | 1,687 | (15) | * | |||||
All directors and executive officers as a group (11 persons) | 336,001 | 2.9 |
Name | Amount and Nature Of Beneficial Ownership | Percent Of Class | ||||||
Franklin Resources, Inc. (1) | 1,211,276 | (1) | 11.3 | % | ||||
T. Rowe Price Associates, Inc. (2) | 1,065,190 | (2) | 9.9 | |||||
NWQ Investment Management Company, LLC (3) | 991,861 | (3) | 9.2 | |||||
The Killen Group, Inc. (4) | 938,900 | (4) | 8.7 | |||||
Dimensional Fund Advisors LP (5) | 838,919 | (5) | 7.8 | |||||
Paul B. Toms, Jr. | 119,169 | (6) | 1.1 | |||||
W. Christopher Beeler, Jr. | 27,736 | (7) | * | |||||
Henry G. Williamson, Jr. | 25,579 | (8) | * | |||||
E. Larry Ryder | 25,300 | (9) | * | |||||
Michael W. Delgatti, Jr. | 14,684 | (10) | * | |||||
John L. Gregory, III | 13,779 | (11) | * | |||||
Mark F. Schreiber | 12,466 | (12) | * | |||||
David G. Sweet | 11,657 | (13) | * | |||||
Paul A. Huckfeldt | 2,413 | * | ||||||
Alan D. Cole | - | * | ||||||
All directors and executive officers as a group (10 persons) | 252,803 | 2.4 | ||||||
(1) | The beneficial ownership information for |
(2) |
The beneficial ownership information for NWQ Investment Management Company, LLC is based upon a Schedule 13G/A filed with the SEC on February |
The beneficial ownership information for Dimensional Fund Advisors LP is based upon a Schedule 13G/A filed with the SEC on February |
(4) | The beneficial ownership information for BlackRock, Inc. is based upon a Schedule 13G filed with the SEC on January 30, 2017. The Schedule 13G indicates that BlackRock, Inc. has sole voting power with respect to 684,656 shares and sole dispositive power with respect to all 701,622 shares. The principal business address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055. |
Mr. Toms has sole voting and disposition power with respect to |
(6) | Mr. Revington has sole voting and disposition power with respect to 55,251 shares. |
(7) | Mr. Beeler has sole voting power with respect to |
(8) | Mr. Williamson has sole voting power with respect to |
(9) | Mr. Delgatti has sole voting and disposition power with respect to 26,978 shares. |
(10) | Mr. Ryder has sole voting power with respect to |
(11) | Mr. Gregory has sole voting power with respect to |
(12) | Mr. |
(13) | Mr. Sweet has sole voting power with respect to |
(14) | Ms. Jacobsen has sole voting and disposition power with respect to |
(15) | Ms. Taaffe has sole voting power with respect to 1,687 shares and sole disposition power with respect to 694 shares. |
§ | fiscal year ended |
§ | fiscal year ended |
Fiscal 2017 | Fiscal 2016 | |||||||
Audit Fees | $ | 1,254,000 | $ | 635,000 | ||||
Audit-Related Fees | None | None | ||||||
Tax Fees | 59,000 | 74,000 | ||||||
All Other Fees | None | None |
Fiscal 2014 | Fiscal 2013 | |||||||
Audit Fees | $ | 656,000 | $ | 515,000 | ||||
Audit-Related Fees | None | None | ||||||
Tax Fees | 76,000 | 60,000 | ||||||
All Other Fees | None | None |
§ | attract and retain highly qualified executives who will contribute significantly to the success and financial growth of the Company and enhance value for shareholders; and |
§ | motivate and appropriately reward executives when they achieve the Company’s financial and business goals and meet their individual performance objectives. |
§ | the name and address of the shareholder, as they appear on the Company’s stock transfer books; |
§ | the number of shares of stock of the Company beneficially owned by the shareholder; |
§ | a representation that the shareholder is a record holder at the time the notice is given and intends to appear in person or by proxy at the meeting to present the business specified in the notice; |
§ | a brief description of the business desired to be brought before the meeting, including the complete text of any resolutions to be presented and the reasons for wanting to conduct such business; and |
§ | any interest that the shareholder may have in such business. |
By Order of the Board of Directors, Robert W. Sherwood Secretary |
PLEASE COMPLETE, SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE | ||||||||
(1) Election of Directors | (2) Ratify the selection of KPMG LLP as the Company’s independent registered public accounting firm for the fiscal year ending January 28, 2018. | FOR ☐ | AGAINST ☐ | ABSTAIN | ||||
☐ FOR ALL NOMINEES | NOMINEES ○Paul B. Toms, Jr. | (3) Advisory vote to approve named executive officer compensation. | FOR ☐ | AGAINST ☐ | ABSTAIN ☐ | |||
○W. Christopher Beeler, Jr. | ||||||||
☐ WITHHOLD AUTHORITY FOR ALL NOMINEES | ○John L. Gregory, III ○E. Larry Ryder ○ | (4) Advisory vote on the frequency of the advisory vote on named executive officer compensation. | ||||||
☐ FOR ALL EXCEPT (See instructions below) | ○Ellen C. Taaffe ○Henry G. Williamson, Jr. | |||||||
ONE YEAR | TWO YEARS | THREE YEARS | ABSTAIN | |||||
☐ | ☐ | ☐ | ☐ | |||||
authorized to vote upon such other thereof. | ||||||||
INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee for whom you wish to withhold authority to vote, as shown here: ● | ||||||||
All as more particularly described in the Company’s Proxy Statement for the Annual Meeting of Shareholders to be held on June | ||||||||
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED SHAREHOLDER. IF NO CHOICE IS SPECIFIED BY THE SHAREHOLDER, THIS PROXY WILL BE VOTED “FOR” THE 7 DIRECTOR NOMINEES LISTED IN ITEM (1), “FOR” ITEMS (2) AND (3), FOR “ONE YEAR” FOR ITEM (4) AND IN THE PROXIES’ DISCRETION ON ANY OTHER MATTERS COMING BEFORE THE MEETING. The undersigned hereby revokes any proxy or proxies heretofore given to vote upon or act with respect to such stock and hereby ratifies and confirms all that said proxies, their substitutes or any of them may lawfully do by virtue hereof. Please promptly complete, sign, date and mail this Proxy Card in the enclosed envelope. No postage is required. Signature of Shareholder ________________________________ Date: _______________ | ||||||||
To change your address on the account please check the box at right and indicate your new address in the address space above. Please note that the changes to the registered name(s) on the account may not be submitted via this method. | ||||||||
Signature of Shareholder_______________________________ Date: _______________ | ||||||||
Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is partnership, please sign in partnership name by authorized person. |