SCHEDULE 14A
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One Coldwater Creek Drive
Sandpoint, Idaho 83864
To Be Held June 9, 2007
1. | To elect three Class II Directors to our Board of Directors (“the Board”); |
2. | To consider and vote upon a proposal to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending February 2, 2008; and |
3. | To act upon such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. |
Very truly yours, | |
Dennis C. Pence Chairman of the Board of Directors, Chief Executive Officer and Secretary Sandpoint, Idaho May 7, 2007 |
Carefully Prior to Returning the Proxy
FOR THE
ANNUAL MEETING OF STOCKHOLDERS OF
COLDWATER CREEK INC.
1. | FOR the election of three Class II Directors to our Board; and |
2. | FOR the ratification of the appointment of Deloitte & Touche LLP (“Deloitte”) as our independent registered public accounting firm for the fiscal year ending February 2, 2008. |
Name | Principal Occupation | Director Since | Age | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
James R. Alexander | President of Alexander & Co., LLC | 2000 Previously 1994–1998 | 64 | |||||||||
Jerry Gramaglia | Partner for Arrowpath Venture Capital | 2004 | 51 | |||||||||
Kay Isaacson-Leibowitz | Former Executive Vice President of Beauty Niches for Victoria’s Secret Stores | 2005 | 60 |
the Board’s Nominating and Corporate Governance Committee from April 2004 to June 2004 and as a member of that Committee since April 2004. From July 2000 to July 2001, Mr. Alexander also served as a member of the Board’s Compensation Committee. Mr. Alexander had previously served as a director, as well as Chairman of the Board’s Compensation Committee, from 1994 to 1998, before declining to stand for re-election due to other professional obligations. Mr. Alexander has been an independent catalog consultant for over 25 years, serving a variety of mail order retailers of apparel, gifts and home decor. Mr. Alexander is President of Alexander & Co., LLC, a direct marketing and retail consulting firm.
Name | Principal Occupation | Director Since | Class and Year in Which Term Will Expire | Age | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Curt Hecker | President and Chief Executive Officer, Intermountain Community Bank | 1995 | Class I 2008 | 46 | |||||||||||||
Georgia Shonk-Simmons | President and Chief Merchandising Officer of Coldwater Creek | 2001 | Class I 2008 | 55 | |||||||||||||
Dennis C. Pence | Chairman of the Board of Directors, Chief Executive Officer and Secretary of Coldwater Creek | 1988 | Class III 2009 | 57 | |||||||||||||
Robert H. McCall | Former President, McCall & Landwehr, P.A. | 1994 | Class III 2009 | 61 | |||||||||||||
Frank M. Lesher | Chapter President of the Greater North Jersey Chapter of the National Multiple Sclerosis Society | 2007 | Class III 2009 | 58 |
to September 25, 2002, Ms. Shonk-Simmons served as our Chief Executive Officer. From April 1999 to December 2000, Ms. Shonk-Simmons served as President of our Catalog & Retail Sales Division. Ms. Shonk-Simmons joined us as Chief Merchant and Vice President of Merchandising in June 1998. From 1994 to 1998, Ms. Shonk-Simmons was Executive Vice President of the Newport News Catalog Division of Spiegel, Inc., a publicly held international retailer. Prior to that, from 1981 to 1994, Ms. Shonk-Simmons held a number of other positions of increasing responsibility with Spiegel, including Vice President of Merchandising for Spiegel Catalog beginning in 1991. Prior to joining Spiegel, Ms. Shonk-Simmons held various buyer positions with Lytton’s, Carson Pirie Scott and Hahne’s.
Name | Executive Committee | Audit Committee | Compensation Committee | Nominating and Corporate Governance Committee | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
James R. Alexander | * | ** | * | |||||||||||||||
Jerry Gramaglia | * | * | ||||||||||||||||
Curt Hecker | * | * | ** | |||||||||||||||
Kay Isaacson-Leibowitz | * | * | ||||||||||||||||
Frank M. Lesher | ||||||||||||||||||
Robert H. McCall | * | ** | * | * | ||||||||||||||
Dennis C. Pence | ** | |||||||||||||||||
Georgia Shonk-Simmons |
* ** | Member Chairperson |
management from time to time on other compensation-related matters. The Compensation Committee also engaged, on a limited basis, Frederick W. Cook & Co., Inc. during 2006 with respect to our SERP. In 2006, the Compensation Committee approved the engagement of Towers Perrin as its compensation consultant, and Towers Perrin assisted the Compensation Committee during the latter half of the year, primarily with assessing our overall compensation levels, peer group analysis and bonus compensation program design for fiscal 2007. Towers Perrin has not previously performed executive compensation consulting services for us. The Compensation Committee currently consists of Mr. Alexander (Chairman), Mr. Gramaglia, Ms. Isaacson-Leibowitz and Mr. McCall. The Board has determined that all of the Compensation Committee members meet the independence requirements of NASDAQ.
Coldwater Creek Board of Directors c/o Coldwater Creek Inc. One Coldwater Creek Drive Sandpoint, ID 83864 |
• | Information regarding the stockholder making the proposal, including name, address, and number of shares of Common Stock beneficially owned by such person; |
• | A representation that the stockholder or the stockholder’s nominee is entitled to vote at the meeting at which directors will be elected, and that the stockholder or the stockholder’s designee intends to cast its vote for the election of the director, if nominated; and |
• | The name, business address and residence of the person or persons being nominated and such other information regarding each nominated person that would be required in a proxy statement filed pursuant to the SEC’s proxy rules, including, but not limited to: |
— | A copy of the nominee’s resume; |
— | Biographical information for the last five years, including directorships and principal occupation or employment of such person; |
— | Date of birth; |
— | A list of references; |
— | A description of any relationship, arrangement or understanding between the stockholder and the nominee and any other person (including names) pursuant to which the nomination is being made; |
— | A description of any direct or indirect relationship, arrangement or understanding between the stockholder or the nominee and us; and |
— | The consent of each such nominee to be named in the Proxy Statement and to serve as a director if elected. |
are recommended by stockholders, employees or other interested parties. Candidates nominated for election or re-election to the Board should possess the following qualifications:
• | The highest professional and personal ethics and values, consistent with our image and reputation; |
• | High-level leadership experience in business and administrative functions with an ability to understand business problems and evaluate and formulate solutions; |
• | Industry-related and other special expertise and skills that are relevant to us and complementary to the background and experience of other Board members; |
• | Ability to devote the time necessary to carry out the duties and responsibilities of Board membership; |
• | Willingness to be an active, objective and constructive participant at meetings of the Board and its committees; |
• | Commitment to serve on the Board over a period of several years to develop knowledge about our business; |
• | Commitment to enhancing stockholder value and representing the best interests of all stockholders and to objectively evaluate management performance; and |
• | The majority of directors on the Board should be “independent,” not only as that term may be legally defined, but also without the appearance of any conflict in serving as a director. In addition, directors should be independent of any particular constituency and be able to represent all of our stockholders. |
recommended to the Board that the audited consolidated financial statements for the fiscal year ended February 3, 2007 be included in the Company’s Annual Report on Form 10-K for such fiscal year.
OF THE AUDIT COMMITTEE
James R. Alexander
Curt Hecker
Robert H. McCall (Chair)
structures. Based on a reevaluation in late 2006, the Compensation Committee determined to exclude Bombay, Williams Sonoma and Cache from our peer group going forward and to add several additional specialty clothing retailers with revenues and market capitalization similar to our own. Data for our revised peer group will be considered for 2007 compensation decisions.
• | Historical, long-term individual performance; |
• | Tenure with the Company; |
• | Retention concerns; |
• | Contribution to Company growth; and |
• | Industry experience |
process with management. The Compensation Committee strives to set the minimum performance goals for Revenue Growth and EBIT Margin at ambitious levels to provide a meaningful incentive. Ifeither of these minimum goals is not reached, no bonus is awarded under the program for the quarter. At the same time, we believe it is important to reward extraordinary performance, and if the target levels are exceeded by a meaningful amount, our NEOs and employees may earn nearly three times their target bonus amounts.
performance level for the Company and that achievement of the goal would warrant payment of the target bonus amount. Based on the Company’s actual performance during the second half of 2006, Mr. Pence did not earn a supplemental bonus under this program. For 2007, the Compensation Committee approved a similar program for Mr. Pence. The 2007 supplemental bonus plan provides for a smaller maximum award, in light of the increased bonus potential for Mr. Pence under the 2007 incentive compensation program.
proximity to a release of earnings or other material information is coincidental. Nevertheless, in light of the media attention surrounding option grant practices, we determined to defer the 2006 executive equity grants until after our second quarter 2006 earnings release. Additionally, the Compensation Committee has adopted a policy beginning in 2007 that annual long-term incentive awards will be made as of our annual meeting date, which occurs in mid-June. The only exceptions to this policy will be for new hires and promotions of NEOs, for which we will endeavor to approve any new awards as soon as possible after the date of hire or promotion. We believe our new policy will allow us to consider prior year performance as well as recent peer group data in making annual awards. A similar policy will apply to option grants made by Mr. Pence, who serves as the sole member of a Secondary Committee and has authority to approve option grants and RSUs for non-executives, subject to guidelines established by the Compensation Committee. These may be awards for new hires and promotions, or discretionary awards, and are reported on a monthly basis to the Compensation Committee. The exercise price of all options granted to our employees is equal to the fair market value of our Common Stock on the date of grant, measured as the closing price of our Common Stock on the grant date as reported by NASDAQ.
of employment within one year thereafter. Additionally, for a period of 30 days commencing one year after a Change in Control, and without the occurrence of an additional event, Ms. Shonk-Simmons has the right to terminate her employment (with or without any reason) and receive severance. We believe that the provision permitting Ms. Shonk-Simmons to receive severance benefits upon her voluntary resignation following a Change in Control is important to ensure that she has a strong incentive not to voluntarily resign during the one-year period after a Change in Control.
James R. Alexander (Chair)
Jerry Gramaglia
Kay Isaacson-Leibowitz
Robert H. McCall
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) (3) | Option Awards ($) (4) | Non-Equity Incentive Plan Compensation ($) (5) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) (6) | All Other Compensation ($) (7) | Total ($) | |||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dennis C. Pence | 2006 | $ | 1,000,000 | — | — | — | $ | 323,720 | $ | 2,485,509 | $ | 10,505 | $ | 3,819,734 | ||||||||||||||||||||||||
Chief Executive Officer | ||||||||||||||||||||||||||||||||||||||
Melvin Dick | 2006 | $ | 425,000 | $ | 225,000 | (1) | $ | 112,755 | $ | 255,048 | $ | 82,153 | $ | 94,343 | $ | 8,894 | $ | 1,203,193 | ||||||||||||||||||||
Chief Financial Officer | ||||||||||||||||||||||||||||||||||||||
Georgia Shonk-Simmons | 2006 | $ | 600,000 | $ | 150,000 | (2) | $ | 160,539 | $ | 153,985 | $ | 152,648 | $ | 203,989 | $ | 9,159 | $ | 1,430,320 | ||||||||||||||||||||
President and Chief Merchandising Officer | ||||||||||||||||||||||||||||||||||||||
Daniel Griesemer | 2006 | $ | 450,000 | — | $ | 169,450 | $ | 319,594 | $ | 108,933 | $ | 70,586 | $ | 8,605 | $ | 1,127,168 | ||||||||||||||||||||||
President and Chief Operating Officer | ||||||||||||||||||||||||||||||||||||||
Dan Moen | 2006 | $ | 311,058 | — | $ | 79,877 | $ | 120,323 | $ | 69,449 | — | $ | 11,962 | $ | 592,669 | |||||||||||||||||||||||
Senior Vice President and Chief Information Officer |
(1) | Represents a retention bonus paid to Mr. Dick, as described below under “Retention Bonus Program”. |
(2) | Represents a discretionary bonus paid to Ms. Shonk-Simmons based on her performance during the first quarter of fiscal 2006. |
(3) | Amounts in this column reflect the expense recognized by us for accounting purposes calculated in accordance with SFAS 123R for RSUs granted in fiscal 2006 and prior years under our Amended and Restated Stock Option/Stock Issuance Plan. The assumptions made in the valuation of these awards are set forth in Note 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended February 3, 2007. For further information on these awards, see the Grants of Plan-Based Awards table. |
(4) | Amounts in this column reflect the expense recognized by us for accounting purposes calculated in accordance with SFAS 123R for stock options granted in fiscal 2006 and prior years under our Amended and Restated Stock Option/Stock Issuance Plan. The assumptions made in the valuation of these awards are set forth in Note 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended February 3, 2007. For further information on these awards, see the Grants of Plan-Based Awards table. |
(5) | The amounts shown in this column consist of payments made under our Incentive Award Program, which is described below under the heading “Incentive Award Program.” |
(6) | The amounts shown in this column represent the aggregate increase in actuarial value of each of the NEO’s benefits under our SERP, which is described below under the heading “Supplemental Executive Retirement Plan.” |
(7) | Amounts shown represent matching contributions we made to NEO’s accounts under our 401(k) Plan. Perquisites are not included in this table as the aggregate incremental cost to us of all perquisites we provided to any NEO in fiscal 2006 was less than $10,000. |
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | Grant Date Fair Value of Stock or Option Awards Granted in Fiscal 2006 ($) | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Sh) | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | ||||||||||||||||||||||||||
Dennis C. Pence | February 13, 2006 | $ | 0 | (1) | $ | 512,715 | (1) | $ | 1,754,016 | (1) | — | — | — | — | ||||||||||||||||
August 28, 2006 | $ | 0 | (2) | — | $ | 3,000,000 | (2) | — | — | — | — | |||||||||||||||||||
Melvin Dick | February 13, 2006 | $ | 0 | (1) | $ | 142,500 | (1) | $ | 487,498 | (1) | — | — | — | — | ||||||||||||||||
August 28, 2006 | — | — | — | $ | 251,472 | 9,300 | (3) | — | — | |||||||||||||||||||||
August 28, 2006 | — | — | — | $ | 264,800 | — | 20,000 | (4) | $ | 27.04 | ||||||||||||||||||||
Georgia Shonk-Simmons | February 13, 2006 | $ | 0 | (1) | $ | 240,000 | (1) | $ | 821,048 | (1) | — | — | — | — | ||||||||||||||||
August 28, 2006 | — | — | — | $ | 405,600 | 15,000 | (3) | — | — | |||||||||||||||||||||
August 28, 2006 | — | — | — | $ | 423,680 | — | 32,000 | (4) | $ | 27.04 | ||||||||||||||||||||
Daniel Griesemer | February 13, 2006 | $ | 0 | (1) | $ | 170,520 | (1) | $ | 583,355 | (1) | — | — | — | — | ||||||||||||||||
August 28, 2006 | — | — | — | $ | 351,520 | 13,000 | (3) | — | — | |||||||||||||||||||||
August 28, 2006 | — | — | — | $ | 370,720 | — | 28,000 | (4) | $ | 27.04 | ||||||||||||||||||||
Dan Moen | February 13, 2006 | $ | 0 | (1) | $ | 109,995 | (1) | $ | 376,297 | (1) | — | — | — | — | ||||||||||||||||
August 28, 2006 | — | — | — | $ | 200,096 | 7,400 | (3) | — | — | |||||||||||||||||||||
August 28, 2006 | — | — | — | $ | 211,840 | — | 16,000 | (4) | $ | 27.04 |
(1) | Amounts shown relate to our 2006 Incentive Award Program for fiscal 2006. The expected threshold level amounts reported above assume that we do not achieve the minimum Revenue Growth or EBIT Margin goals. The expected target level amounts reported above assume that we achieve the targeted Revenue Growth and EBIT Margin goals and that the executive earns his or her target-level performance-based Semiannual Incentive Award. The expected Maximum level amounts reported above assume that we achieve the maximum Revenue Growth and EBIT Margin goals and that the executive earns 100 percent of the performance-based Semiannual Incentive Award. Actual Incentive Award Program bonuses paid during fiscal 2006 are set forth above in the Summary Compensation Table. For a full description of the 2006 Incentive Award Program, see “Incentive Award Program” below. |
(2) | Amounts shown relate to the Supplemental CEO Bonus program for fiscal 2006. Based on the Company’s actual performance during the second half of 2006, Mr. Pence did not earn a supplemental bonus under this program. For a full description of the Supplemental CEO Bonus program, see “Supplemental CEO Bonus Plan” below. |
(3) | Consists of shares of Common Stock underlying RSUs granted under our Amended and Restated Stock Option/Stock Issuance Plan. All of these RSUs vest on the third anniversary of the grant date, subject to the executive obtaining performance reviews within the range of “meets expectations” throughout the vesting period. The holder of an RSU award receives shares of our Common Stock upon vesting and does not have any rights associated with the shares prior to their delivery in accordance with the award agreement. |
(4) | Consists of options to purchase our Common Stock granted under our Amended and Restated Stock Option/Stock Issuance Plan. The exercise price is equal to the closing price of our Common Stock on the grant date, and the options vest in three equal installments on each of the first, second and third anniversaries of the grant date and expire on the seventh anniversary of the grant date. |
Option Awards | Stock Awards | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercised | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(21) | |||||||||||||||||||||
Dennis C. Pence | — | — | — | — | — | — | |||||||||||||||||||||
Melvin Dick | — | 23,900 | (1) | $ | 11.38 | 5/8/2012 | — | — | |||||||||||||||||||
60,015 | 37,969 | (2) | $ | 3.21 | 6/28/2012 | — | — | ||||||||||||||||||||
— | 50,624 | (3) | $ | 1.93 | 4/30/2013 | — | — | ||||||||||||||||||||
— | 20,000 | (4) | $ | 27.04 | 8/28/2013 | — | — | ||||||||||||||||||||
— | 30,375 | (5) | $ | 6.32 | 3/31/2014 | — | — | ||||||||||||||||||||
— | — | — | — | 29,100 | (17) | $ | 556,392 | ||||||||||||||||||||
Georgia Shonk-Simmons | 367,779 | — | $ | 2.27 | 1/31/2010 | — | — | ||||||||||||||||||||
15,900 | 31,800 | (6) | $ | 11.38 | 5/8/2012 | — | — | ||||||||||||||||||||
— | 32,000 | (7) | $ | 27.04 | 8/28/2013 | — | — | ||||||||||||||||||||
— | — | — | — | 41,400 | (18) | $ | 791,568 | ||||||||||||||||||||
Daniel Griesemer | 18,550 | 37,100 | (8) | $ | 11.38 | 5/8/2012 | — | — | |||||||||||||||||||
54,829 | 50,624 | (9) | $ | 1.93 | 4/30/2013 | — | — | ||||||||||||||||||||
— | 28,000 | (10) | $ | 27.04 | 8/28/2013 | — | — | ||||||||||||||||||||
30,375 | 20,250 | (11) | $ | 2.88 | 9/30/2013 | — | — | ||||||||||||||||||||
33,750 | 50,625 | (12) | $ | 6.32 | 3/31/2014 | — | — | ||||||||||||||||||||
— | — | — | — | 43,750 | (19) | $ | 836,500 | ||||||||||||||||||||
Dan Moen | 7,950 | 15,900 | (13) | $ | 11.38 | 5/8/2012 | — | — | |||||||||||||||||||
— | 20,250 | (14) | $ | 1.93 | 4/30/2013 | — | — | ||||||||||||||||||||
— | 16,000 | (15) | $ | 27.04 | 8/28/2013 | — | — | ||||||||||||||||||||
10,126 | 15,187 | (16) | $ | 6.32 | 3/31/2014 | — | — | ||||||||||||||||||||
— | — | — | — | 20,600 | (20) | $ | 393,872 |
(1) | Consists of 11,950 options that vest on May 8, 2007 and 11,950 options that vest on May 8, 2008. |
(2) | Consists of 37,969 options that vest on June 28, 2007. |
(3) | Consists of 25,312 options that vest on April 30, 2007 and 25,312 options that vest on April 30, 2008. |
(4) | Consists of 6,667 options that vest on August 28, 2007, 6,667 options that vest on August 28, 2008 and 6,666 options that vest on August 28, 2009. |
(5) | Consists of 10,125 options that vest on March 1, 2007, 10,125 options that vest on March 1, 2008 and 10,125 options that vest on March 1, 2009. |
(6) | Consists of 15,900 options that vest on May 8, 2007 and 15,900 options that vest on May 8, 2008. |
(7) | Consists of 10,667 options that vest on August 28, 2007, 10,667 options that vest on August 28, 2008 and 10,666 options that vest on August 28, 2009. |
(8) | Consists of 18,550 options that vest on May 8, 2007 and 18,550 options that vest on May 8, 2008. |
(9) | Consists of 25,312 options that vest on April 30, 2007 and 25,312 options that vest on April 30, 2008. |
(10) | Consists of 9,334 options that vest on August 28, 2007, 9,333 options that vest on August 28, 2008 and 9,333 options that vest on August 28, 2009. |
(11) | Consists of 10,125 options that vest on September 30, 2007 and 10,125 options that vest on September 30, 2008. |
(12) | Consists of 16,875 options that vest on March 1, 2007, 16,875 options that vest on March 1, 2008 and 16,875 options that vest on March 1, 2009. |
(13) | Consists of 7,950 options that vest on May 8, 2007 and 7,950 options that vest on May 8, 2008. |
(14) | Consists of 10,125 options that vest on April 30, 2007 and 10,125 options that vest on April 30, 2008. |
(15) | Consists of 5,334 options that vest on August 28, 2007, 5,333 options that vest on August 28, 2008 and 5,333 options that vest on August 28, 2009. |
(16) | Consists of 5,063 shares that vest on March 1, 2007, 5,062 shares that vest on March 1, 2008 and 5,062 shares that vest on March 1, 2009. |
(17) | Represents shares of Common Stock underlying RSUs granted under our Amended and Restated Stock Option/Stock Issuance Plan, 19,800 shares of which vest and are deliverable on May 8, 2008, and 9,300 shares of which vest and are deliverable on August 28, 2009, subject to the executive obtaining performance reviews within the range of “meets expectations” throughout the vesting period. |
(18) | Represents shares of Common Stock underlying RSUs granted under our Amended and Restated Stock Option/Stock Issuance Plan, 26,400 shares of which vest and are deliverable on May 8, 2008, and 15,000 shares of which vest and are deliverable on August 28, 2009, subject to the executive obtaining performance reviews within the range of “meets expectations” throughout the vesting period. |
(19) | Represents shares of Common Stock underlying RSUs granted under our Amended and Restated Stock Option/Stock Issuance Plan, 30,750 shares of which vest and are deliverable on May 8, 2008, and 13,000 shares of which vest and are deliverable on August 28, 2009, subject to the executive obtaining performance reviews within the range of “meets expectations” throughout the vesting period. |
(20) | Represents shares of Common Stock underlying RSUs granted under our Amended and Restated Stock Option/Stock Issuance Plan, 13,200 shares of which vest and are deliverable on May 8, 2008, and 7,400 shares of which vest and are deliverable on August 28, 2009, subject to the executive obtaining performance reviews within the range of “meets expectations” throughout the vesting period. |
(21) | Determined by multiplying $19.12, the closing price of our Common Stock on February 2, 2007, by the number of shares underlying each RSU award. |
Option Awards | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) (1) | |||||||||
Dennis C. Pence | — | — | |||||||||
Melvin Dick | 200,000 | $ | 5,065,423 | ||||||||
Georgia Shonk-Simmons | 250,000 | $ | 6,150,308 | ||||||||
Daniel Griesemer | 210,955 | $ | 5,510,171 | ||||||||
Dan Moen | 22,275 | $ | 611,773 |
(1) | Based upon the closing selling price of the Common Stock, as reported by NASDAQ on the exercise date, less the exercise price paid per share. |
Name | Plan Name | Number of Years Credited Service | Present Value of Accumulated Benefits (1) | Payments During Last Fiscal Year | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dennis C. Pence | Supplemental Executive Retirement Plan | 20.0 | $ | 6,145,921 | — | |||||||||||||
Melvin Dick | Supplemental Executive Retirement Plan | 4.6 | $ | 340,080 | — | |||||||||||||
Georgia Shonk-Simmons | Supplemental Executive Retirement Plan | 8.6 | $ | 1,075,942 | — | |||||||||||||
Daniel Griesemer | Supplemental Executive Retirement Plan | 5.3 | $ | 299,864 | — | |||||||||||||
Dan Moen | — | — | — | — |
(1) | Amounts shown in this column represent the actuarial present value of the NEO’s accumulated benefit under the SERP computed using the same assumptions used for financial reporting purposes except that the SERP’s normal retirement age of 62 was used as the retirement age assumption. In addition, since Mr. Pence is currently eligible to retire without a reduction in benefits, his current age was used to determine the present value of his accumulated benefit. See Note 13 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended February 3, 2007 for a discussion of the methodology and assumptions used in calculating these amounts. |
Name | Annual Retirement Benefit (1) | |||||
---|---|---|---|---|---|---|
Dennis C. Pence | $ | 487,000 | ||||
Georgia Shonk-Simmons | $ | 127,000 | ||||
Daniel Griesemer | $ | 59,000 | ||||
Melvin Dick | $ | 48,000 |
(1) | On normal retirement at age 62, except with respect to Mr. Pence who is fully vested. |
of disability on February 3, 2007, Ms. Shonk-Simmons, Mr. Griesemer and Mr. Dick would be entitled to receive continued vesting in the following annual benefits, commencing at the age set forth below:
Name | Annual Retirement Benefit | Payment Commencement Age | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Georgia Shonk-Simmons | $ | 114,000 | 59 | |||||||
Daniel Griesemer | $ | 43,000 | 55 | |||||||
Melvin Dick | $ | 39,000 | 57 |
OTHER TERMINATION EVENTS
• | Ms. Shonk-Simmons’s employment is terminated by the Company without “Cause” (generally defined as conviction for the commission of a felony; dishonesty; continuing failure to perform her duties; material violation of Company policy; or material violation of the terms of her employment agreement, including its non-competition provision); |
• | Ms. Shonk-Simmons terminates her employment for Good Reason (as defined below); |
• | Lump sum cash severance equal to one and one-half times the sum of her annual salary plus her annual bonus at target level in effect on the day of termination; |
• | Full vesting of all unvested equity awards held by her; |
• | Accelerated full vesting under the SERP and payment in accordance with its terms (see “Pension Benefits”); and |
• | Continuation of health benefits for eighteen months |
• | Upon the material reduction of her authority, duties and responsibilities, |
• | Upon a reduction in her annual salary, except in connection with a reduction in compensation generally applicable to senior management employees of the Company; |
• | Upon the Company’s relocation of her principal place of employment more than 50 miles from the Company’s principal place of business in Sandpoint, Idaho; |
• | Upon the Company’s material and willful breach of the agreement; or |
• | For a period of 30 days, commencing one year after a Change in Control. In the event she terminates her employment during this 30-day period, it will be deemed to have occurred within twelve months of the Change in Control for purposes of calculating her lump sum cash severance. |
Component of Compensation | Termination by the Executive For Good Reason | Termination by the Company Without Cause | Termination due to the Executive’s Disability | Change in Control of Company with the Executive’s Termination | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Cash Severance (base salary + bonus) | $ | 1,260,000 | $ | 1,260,000 | $ | 50,000 | (2) | $ | 2,100,000 | |||||||||
Restricted Stock Units — Accelerated | $ | 791,568 | $ | 791,568 | — | $ | 791,568 | |||||||||||
Stock Options(1) — Accelerated | $ | 246,132 | $ | 246,132 | — | $ | 246,132 | |||||||||||
Health & Welfare | $ | 10,207 | $ | 10,207 | — | $ | 10,207 | |||||||||||
Excise Tax Gross-Up | — | — | — | — | ||||||||||||||
Total | $ | 2,307,907 | $ | 2,307,907 | $ | 50,000 | $ | 3,147,907 |
(1) | For the table above, the RSUs represent the number of shares under the award multiplied by the Company’s 2006 fiscal year end stock price of $19.12. For stock options, the value represents the number of the option shares outstanding for the executive multiplied by the difference between the Company’s 2006 fiscal year end stock price and the option’s exercise price. |
(2) | Upon permanent disability, Ms. Shonk-Simmons is entitled to her current monthly salary (which as of February 3, 2007 is $50,000) for a period of eighteen months. |
Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(7) | Option Awards ($)(8) | All Other Compensation ($) | Total ($) | |||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
James R. Alexander (1) | $ | 165,500 | $ | 29,480 | — | $ | 32 | (9) | $ | 195,012 | ||||||||||||
Jerry Gramaglia (2) | $ | 121,000 | $ | 29,480 | $ | 111,733 | $ | 32 | (9) | $ | 262,245 | |||||||||||
Curt Hecker (3) | $ | 131,500 | $ | 29,480 | — | $ | 32 | (9) | $ | 161,012 | ||||||||||||
Kay Isaacson-Leibowitz (4) | $ | 121,000 | $ | 29,480 | $ | 74,030 | $ | 32 | (9) | $ | 224,542 | |||||||||||
Frank M. Lesher (5) | $ | 3,000 | — | $ | 250 | — | $ | 3,250 | ||||||||||||||
Robert H. McCall (6) | $ | 181,500 | $ | 29,480 | — | $ | 32 | (9) | $ | 211,012 |
(1) | Mr. Alexander was granted 989 RSUs in fiscal 2006 with an aggregate grant date fair value of $25,000. He held 989 RSUs and 31,313 stock options that remained outstanding as of February 3, 2007. |
(2) | Mr. Gramaglia was granted 989 RSUs in fiscal 2006 with an aggregate grant date fair value of $25,000. He held 989 RSUs and 62,716 stock options that remained outstanding as of February 3, 2007. |
(3) | Mr. Hecker was granted 989 RSUs in fiscal 2006 with an aggregate grant date fair value of $25,000. He held 989 RSUs and 165,929 stock options that remained outstanding as of February 3, 2007. |
(4) | Mrs. Isaacson-Leibowitz was granted 989 RSUs in fiscal 2006 with an aggregate grant date fair value of $25,000. She held 989 RSUs and 45,144 stock options that remained outstanding as of February 3, 2007. |
(5) | Mr. Lesher was granted 30,000 stock options in fiscal 2006 with an aggregate grant date fair value of $282,900. He held 30,000 stock options that remained outstanding as of February 3, 2007. |
(6) | Mr. McCall was granted 989 RSUs in fiscal 2006 with an aggregate grant date fair value of $25,000. He held 989 RSUs and 122,347 stock options that remained outstanding as of February 3, 2007. |
(7) | Amounts in this column reflect the expense recognized by us for accounting purposes calculated in accordance with SFAS 123R for RSUs granted in fiscal 2006 and prior years under our Amended and Restated Stock Option/Stock Issuance Plan. The assumptions made in the valuation of these awards are set forth in Note 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended February 3, 2007. |
(8) | Amounts in this column reflect the expense recognized by us for accounting purposes calculated in accordance with SFAS 123R for stock options granted in fiscal 2006 and prior years under our Amended and Restated Stock Option/Stock Issuance Plan. The assumptions made in the valuation of these awards are set forth in Note 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended February 3, 2007. |
(9) | Consists of $32 paid by the Company with respect to life insurance premiums. |
Annual Retainer | Meeting Fees | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Board of Directors | $ | 50,000 | One hour or more: | $3,000 | ||||||||||
Under one hour: | $1,000 | |||||||||||||
Committees of the Board of Directors | $ | 5,000 | One hour or more: | $2,000 | ||||||||||
Under one hour: | $ 500 | |||||||||||||
Audit Committee Chair | $ | 30,000 | ||||||||||||
Compensation Committee Chair | $ | 15,000 | ||||||||||||
Nominating and Corporate Governance Committee Chair | $ | 15,000 |
Plan Category | Number of Securities to Be Issued on Exercise of Outstanding Options, Warrants, and Rights (a) | Weighted Average Exercise Price of Outstanding Options, Warrants, and Rights (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Equity compensation plans approved by security holders | 2,960,593 | (1) | $ | 7.91 | (2) | 5,651,109 | (3) | |||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||||
Total | 2,960,593 | $ | 7.91 | 5,651,109 |
(1) | Consists of options and 226,295 unvested RSUs awarded under the Amended and Restated Stock Option/Stock Issuance Plan. |
(2) | Does not include the 226,295 unvested RSUs as such awards do not have an exercise price. |
(3) | Includes 3,867,050 shares of Common Stock that remain available for future grants under the Amended and Restated Stock Option/Stock Issuance Plan and 1,784,059 shares of Common Stock available for purchase under our 2006 Employee Stock Purchase Plan. |
• | Each person, or group of affiliated persons, known by us to beneficially own more than five percent of the outstanding shares of Common Stock; |
• | Each director and nominee for director; |
• | Our NEOs; and |
• | All of our current directors and executive officers as a group. |
Name and Address of Beneficial Owner | Shares Beneficially Owned | Percentage of Shares Beneficially Owned (1) | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
E. Ann Pence (2) (3) | 18,133,671 | 19.5 | % | |||||||
Dennis C. Pence (2) (4) | 13,208,307 | 14.2 | % | |||||||
AXA Financial, Inc. and affiliates (5) | 6,555,136 | 7.0 | % | |||||||
James R. Alexander (6) | 35,986 | * | ||||||||
Jerry Gramaglia (7) | 54,131 | * | ||||||||
Curt Hecker (8) | 203,981 | * | ||||||||
Kay Isaacson-Leibowitz (9) | 36,583 | * | ||||||||
Frank M. Lesher (10) | 1,243 | * | ||||||||
Robert H. McCall (11) | 123,834 | * | ||||||||
Georgia Shonk-Simmons (12) | 414,382 | * | ||||||||
Melvin Dick (13) | 131,696 | * | ||||||||
Daniel Griesemer (14) | 198,241 | * | ||||||||
Dan Moen (15) | 75,639 | * | ||||||||
All directors and executive officers as a group (11 persons) (16) | 14,484,203 | 15.5 | % |
* | Less than one percent. |
(1) | The information in this table is based upon information furnished by each director, executive officer and principal stockholder or contained in filings made by these persons with the SEC. The calculation of the percentage of shares beneficially owned is based on 93,213,904 shares of Common Stock outstanding as of March 31, 2007. Shares of Common Stock subject to stock options which are currently exercisable or will become exercisable within 60 days after March 31, 2007, are deemed outstanding for computing the percentage of the person or group holding such options, but are not deemed outstanding for computing the percentage of any other person or group. |
(2) | Dennis C. Pence and E. Ann Pence divorced in June 2003. Prior to December 31, 2006, they maintained an informal agreement to vote the shares of Common Stock held by each in a similar manner. Effective as of December 31, 2006, this agreement was terminated in all respects. |
(3) | Includes (a) 17,998,671 shares owned of record by E. Ann Pence and (b) 135,000 shares owned of record by the Dancing River Foundation. Ms. Pence disclaims beneficial ownership over the shares owned of record by the Dancing River Foundation. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(4) | Includes 12,658,307 shares owned of record by Dennis C. Pence and (b) 550,000 shares owned of record by the Wild Rose Foundation. Mr. Pence disclaims beneficial ownership over the shares owned of record by the Wild Rose Foundation. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(5) | Consists of 6,555,136 shares beneficially owned by AXA Financial, Inc., AXA Assurances I.A.R.D Mutuelle, AXA Assurances Vie Mutuelle, AXA Courtage Assurance Mutuelle, and AXA as reported on Schedule 13G as of December 31, 2006. Address: 1290 Avenue of the Americas, New York, NY 10104. |
(6) | Includes 31,313 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(7) | Includes 40,144 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(8) | Includes 165,929 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(9) | Includes 30,096 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(10) | Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(11) | Consists of 122,347 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(12) | Includes 399,580 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(13) | Includes 107,402 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(14) | Consists of 198,241 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(15) | Includes 41,214 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. Address: c/o Coldwater Creek Inc., One Coldwater Creek Drive, Sandpoint, Idaho 83864. |
(16) | Includes 1,136,266 shares issuable upon exercise of options that are currently exercisable or will become exercisable within 60 days after March 31, 2007. |
• | A usage based pro rata portion of the actual financing costs of the jet fractional share rights; |
• | A usage based pro rata portion of the actual monthly maintenance fees; and |
• | Actual hourly usage fees. |
RATIFICATION OF SELECTION OF THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Fiscal 2006 | Fiscal 2005 | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Deloitte | KPMG | KPMG | ||||||||||||
Audit Fees | $ | 1,245,571 | $ | 260,288 | (3) | $ | 723,000 | |||||||
Audit Related Fees (1) | 22,600 | 5,000 | 18,000 | |||||||||||
All Other Fees (2) | 6,000 | — | — | |||||||||||
Total Fees | $ | 1,274,171 | $ | 265,288 | $ | 741,000 |
(1) | Audit related fees represent fees billed for audits and other services related to our 401(k) plan. |
(2) | All other fees represent fees for accounting research software. |
(3) | Primarily represents audit fees paid for services rendered in fiscal 2006 related to the restatement of our fiscal 2005 financial statements that were included in our 2005 Annual Report on Form 10-K/A and consents issued in connection with our Registration Statements on Form S-8. |
By Order of the Board of Directors, | |
Dennis C. Pence Chairman of the Board of Directors, Chief Executive Officer and Secretary May 7, 2007 Sandpoint, Idaho |
The Board of Directors recommends a vote FOR proposals Nos. 1 and 2. This Proxy, when properly executed, will be voted as specified hereon. This Proxy will be voted FOR proposals Nos. 1 and 2 if no specification is made. | Please Mark Here for Address Change or Comments | ¨ |
SEE REVERSE SIDE |
1. Election of the following nominees as Class II directors: | 2. | To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending February 2, 2008. | FOR | AGAINST | ABSTAIN | |||||||
FOR all nominees (except as listed to the contrary below) | WITHHOLD AUTHORITY to vote for all nominees | ¨ | ¨ | ¨ | ||||||||
¨ | ¨ | |||||||||||
Nominees: 01 James R. Alexander, 02 Jerry Gramaglia, 03 Kay Isaacson-Leibowitz | ||||||||||||
(Instructions: To withhold authority to vote for any individual nominee(s), write the name(s) of the nominee(s) on the line below.) | ||||||||||||
Signature: | Date: |
COLDWATER CREEK INC. PROXY FOR ANNUAL MEETING OF STOCKHOLDERS JUNE 9, 2007 | |
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS | |
The undersigned acknowledges receipt of the Notice of the Annual Meeting of Stockholders to be held on June 9, 2007 and the Proxy Statement and appoints Dennis C. Pence and Melvin Dick, and each or either of them, as Proxies of the undersigned, with full power of substitution, and hereby authorizes them to represent and to vote, as designated on the reverse side, all shares of Common Stock of Coldwater Creek Inc. (the “Company”) which the undersigned is entitled to vote, either on his or her own behalf or on behalf of any entity or entities, at the Annual Meeting of Stockholders of the Company to be held June 9, 2007 at 9:30 a.m. local time and at any adjournment or postponement thereof. | |
(continued and to be marked, dated and signed on reverse side) | |
Address Change/Comments (Mark the corresponding box on the reverse side) | |
|
5Detach here from proxy voting card.5