Exhibit 10.153
Tiffany & Co.
(a Delaware corporation)
Corporate Governance Principles
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(as adopted by the full Board of Directors on January 15, 2004
and amended and restated March 15, 2007)
1. Director Qualification Standards; Size of the Board; Audit Committee
Service.
a. A majority of the directors shall meet the independence requirements set
forth in Section 303A.01 and .02 of the New York Stock Exchange Corporate
Governance Rules. A director shall not be deemed to have met such independence
requirements unless the Board has affirmatively determined that it be so. In
making its determination of independence, the Board shall broadly consider all
relevant facts and circumstances and assess the materiality of each director's
relationship(s) with the Corporation and/or its subsidiaries. If a director is
determined by the Board to be independent, all relationships, if any, that such
director has with the Corporation and/or its subsidiaries which were determined
by the Board to be immaterial to independence shall be disclosed in the
Corporation's annual proxy statement.
b. A director shall be younger than age 72 when elected or appointed and a
director shall not be recommended for re-election by the stockholders if such
director will be age 72 or older on the date of the annual meeting or other
election in question, provided that the Board of Directors may, by specific
resolution, waive the provisions of this sentence with respect to an individual
director whose continued service is deemed uniquely important to the
Corporation.
c. A director need not be a stockholder to qualify as a director, but shall
be encouraged to become a stockholder by virtue of the Corporation's policies
and plans with respect to stock options and stock ownership for directors and
otherwise.
d. Consistent with 1.a. above, candidates for director shall be selected on
the basis of their business experience and expertise, with a view to
supplementing the business experience and expertise of management and adding
further substance and insight into board discussions and oversight of
management. The Nominating/Corporate Governance Committee is responsible for
identifying individuals qualified to become directors, and for recommending to
the Board director nominees for the next annual meeting of the stockholders.
e. From time to time, the Nominating/Corporate Governance Committee will
recommend to the Board the number of directors constituting the entire Board.
Based upon that recommendation, the current nature of the Corporation's
business, and the talents and business experience of the existing roster of
directors, the Board believes that nine directors is an appropriate number at
this time.
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f. The Board shall be responsible for determining the qualification of an
individual to serve on the Audit Committee as a designated "audit committee
financial expert," as required by applicable rules of the SEC under Section 407
of the Sarbanes-Oxley Act. In addition, to serve on the Audit Committee, a
director must meet the standards for independence set forth in Section 301 of
the Sarbanes-Oxley Act. To those ends, the Nominating/Corporate Governance
Committee will coordinate with the Board in screening any new candidate for
audit committee financial expert or who will serve on the Audit Committee and in
evaluating whether to re-nominate any existing director who may serve in the
capacity of audit committee financial expert or who may serve on the Audit
Committee. If an Audit Committee member simultaneously serves on the audit
committees of more than three public companies, then, in the case of each such
Audit Committee member, the Board must determine that such simultaneous service
would not impair the ability of such member to effectively serve on the
Corporation's Audit Committee and disclose such determination in the
Corporation's annual proxy statement.
g. Any director who changes his or her employer or otherwise has a
significant change in job responsibilities, or who accepts or intends to accept
a directorship with another public company (or with any other organization that
would require a significant time commitment) that he or she did not hold when
such director was most recently elected to the Board, shall (1) advise the
secretary of the Corporation of such change or directorship and (2) submit to
the Nominating/Corporate Governance Committee, in care of the secretary, a
signed letter, addressed to such Committee, resigning as a director of the
Corporation effective upon acceptance of such resignation by such Committee but
void ab initio if not accepted by such Committee within ten (10) days of receipt
by the secretary. The secretary of the Corporation shall promptly advise the
members of the Nominating/Corporate Governance Committee of such advice and
receipt of such letter. The Nominating/Corporate Governance Committee shall
promptly meet and consider, in light of the circumstances, the continued
appropriateness of such director's membership on the Board and each committee of
the Board on which such director participates. In some instances, taking into
account all relevant factors and circumstances, it may be appropriate for the
Nominating/Corporate Governance Committee to accept such resignation, to
recommend to the Board that the director cease participation on one or more
committees, or to recommend to the Board that such director not be re-nominated
to the Board.
h. Subject to 1.b above, directors of the Corporation are not subject to
term limits. However, the Nominating/Corporate Governance Committee will
consider each director's continued service on the Board each year and recommend
whether each director should be re-nominated to the Board. Each director will be
given an opportunity to confirm his or her desire to continue as a member of the
Board.
i. The Corporation has amended its By-Laws to provide for majority voting
in the election of directors. In uncontested elections, directors are elected by
a majority of the votes cast, which means that the number of shares voted "for"
a director must exceed the number of shares voted "against" that director. The
Nominating/Corporate Governance Committee (or comparable committee of the Board)
shall establish procedures for any director who is not elected to tender his or
her resignation. The Nominating/Corporate
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Governance Committee will make a recommendation to the Board on whether to
accept or reject the resignation, or whether other action should be taken. The
Board will act on the Nominating/Corporate Governance Committee's recommendation
within 90 days following certification of the election results. In determining
whether or not to recommend that the Board of Directors accept any resignation
offer, the Nominating/Corporate Governance Committee shall be entitled to
consider all factors believed relevant by such Committee's members. Unless
applicable to all directors, the director(s) whose resignation is under
consideration is expected to recuse himself or herself from the Board vote.
Thereafter, the Board will promptly disclose its decision regarding the
director's resignation offer (including the reason(s) for rejecting the
resignation offer, if applicable) in a Form 8-K furnished to the Securities and
Exchange Commission. If the Board accepts a director's resignation pursuant to
this process, the Nominating/Corporate Governance Committee shall recommend to
the Board whether to fill such vacancy or reduce the size of the Board. If, for
any reason, the Board of Directors is not elected at an annual meeting, they may
be elected thereafter at a special meeting of the stockholders called for that
purpose in the manner provided in the By-laws.
j. Including service on the Board of Directors of the Corporation, no
director shall serve on the board of directors (or any similar governing body)
of more than six public companies.
2. Attendance and Participation at Board and Committee Meetings.
a. Directors shall be expected to attend six regularly scheduled board
meetings in person, if practicable, or by telephone, if attendance in person is
impractical. Directors should attempt to organize their schedules in advance so
that attendance at all regularly scheduled board meetings will be practicable.
b. For committees on which they serve, directors shall be expected to
attend regularly scheduled meetings in person, if practicable, or by telephone,
if attendance in person is impractical or if telephone participation is the
expected means of participation. For committees on which they serve, directors
should attempt to organize their schedules in advance so that attendance at all
regularly scheduled committee meetings will be practicable.
c. Directors shall attempt to make time to attend, in person or by
telephone, specially scheduled meetings of the Board or those committees on
which they serve.
d. Directors shall, if practicable, review in advance all meeting materials
provided by management, the other directors or consultants to the Board.
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e. Directors shall familiarize themselves with the policies and procedures
of the Board with respect to business conduct, ethics, confidential information
and trading in the Corporation's securities.
f. Nothing stated herein shall be deemed to limit the duties of directors
under applicable law.
3. Director Access to Management and Independent Advisors.
a. Executive officers of the Corporation and its subsidiaries shall make
themselves available, and shall arrange for the availability of other members of
management, employees and consultants, so that each director shall have full and
complete access with respect to the business, finances and accounting of the
Corporation and its subsidiaries.
b. The chief financial officer and the chief legal officer of
the Corporation will regularly attend Board meetings (other than those portions
of Board meetings that are reserved for independent or non-management directors
or those portions in which the independent or non-management directors meet
privately with the chief executive officer) and the Board encourages the chief
executive officer to invite other executive officers and non-executive officers
to Board meetings from time to time in order to provide additional insight into
items being discussed and so that the Board may meet and evaluate persons with
potential for advancement.
c. If the charter of any Board committee on which a director serves
provides for access to independent advisors, any executive officer of the
Corporation is authorized to arrange for the payment of the reasonable fees of
such advisors at the request of such a committee acting by resolution or
unanimous written consent.
4. Director Compensation.
a. Directors shall be compensated in a manner and at a level sufficient to
encourage exceptionally well-qualified candidates to accept service upon the
Board and to retain existing directors. The Board believes that a meaningful
portion of a director's compensation should be provided in, or otherwise based
upon appreciation in the market value of, the Corporation's Common Stock.
b. To help determine the form and amount of director compensation, the
staff of the Corporation shall, if requested by the Board provide the Board with
data drawn from public company filings with respect to the fees and emoluments
paid to outside directors by comparable public companies.
c. Contributions to charities with which an independent or non-management
director is affiliated will not be used as compensation to such a director and
management will use special efforts to avoid any appearance of impropriety in
connection with such contributions, if any.
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d. Management will advise the Board should the Corporation or any
subsidiary wish to enter into any direct financial arrangement with any director
for consulting or advisory services, or into any arrangement with any entity
affiliated with such director by which the director may be indirectly benefited,
and no such arrangement shall be consummated without specific authorization from
the Board.
5. Director Orientation and Continuing Education.
a. Each executive officer of the Corporation shall meet with each new
director and provide an orientation into the business, finance and accounting of
the Corporation.
b. Each director shall be reimbursed for reasonable expenses incurred in
pursuing continuing education with respect to his/her role and responsibilities
to the stockholders and under law as a director.
6. Management Succession
a. The Board, assisted by the Corporate Nominating/Corporate Governance
Committee and the Compensation Committee, shall select, evaluate the performance
of, retain or replace the chief executive officer. Such actions will be taken
with (i) a view to the effectiveness and execution of strategies propounded by
and decisions taken by the chief executive officer with respect the
Corporation's long-term strategic plan and long-term financial returns and (ii)
applicable legal and ethical considerations.
b. In furtherance of the foregoing responsibilities, and in contemplation
of the retirement, or an exigency that requires the replacement, of the chief
executive officer, the Board shall, in conjunction with the chief executive
officer, oversee the selection and evaluate the performance of the other
executive officers.
7. Annual Performance Evaluation of the Board.
a. The Nominating/Corporate Governance Committee is responsible to assist
the Board in the Board's oversight of the Board's own performance in the area of
corporate governance.
b. Annually, each director will participate in an assessment of the Board's
performance in the area of corporate governance. The results of such
self-assessment will be provided to each director.
8. Matters for Board Review, Evaluation and/or Approval.
a. The Board is responsible under the law of the State of Delaware to
review and approve significant actions by the Corporation including major
transactions (such as
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acquisitions and financings), declaration of dividends, issuance of securities
and appointment of officers of the Corporation.
b. The Board is responsible, either through its committees, or as guided by
its committees, for those matters which are set forth in the respective charters
of the Auditing, Nominating/Corporate Governance and Compensation Committees or
as otherwise set forth in the corporate governance rules of the New York Stock
Exchange.
c. The following matters, among others, will be the subject of Board
deliberation:
i. annually, the Board will review and if acceptable approve the
Corporation's operating plan for the fiscal year, as developed and recommended
by management;
ii. at each regularly scheduled meeting of the Board, the directors
will review actual performance against the operating plan;
iii. annually, the Board will review and if acceptable approve the
Corporation's five-year strategic plan, as developed and recommended by
management;
iv. from time to time, the Board will review topics of relevance to
the approved or evolving strategic plan, including such topics identified by the
Board and those identified by management;
v. annually, the charters of the Audit, Nominating/Corporate
Governance, and Compensation Committees will be reviewed and, if necessary,
modified, by the Board;
vi. annually, the delegation of authority to officers and employees
for day-to-day operating matters of the Corporation and its subsidiaries will be
reviewed and if acceptable approved by the Board;
vii. annually, the Corporation's investor relations program will be
reviewed by the Board;
viii. annually, the schedule of insurance coverage for the Corporation
and its subsidiaries will be reviewed by the Board;
ix. annually, the status of various litigation matters in which the
Corporation and its subsidiaries are involved will be presented to and discussed
with the Board;
x. annually, the Corporation's policy with respect to the payment of
dividends will be reviewed and if acceptable approved by the Board;
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xi. annually, the Corporation's program for use of foreign currency
hedges and forward contracts will be reviewed and if acceptable approved by the
Board; and
xii. from time to time, the Corporation's use of any stock re-purchase
program approved by the Board will be reviewed by the Board.
9. Management's Responsibilities
Management is responsible to operate the Corporation with the objective of
achieving the Corporation's operating and strategic plans and building value for
stockholders on a long-term basis. In executing those responsibilities
management is expected to act in accordance with the policies and standards
established by the Board (including these principles), as well as in accordance
with applicable law and for the purpose of maintaining the value of the
trademarks and business reputation of the Corporation's subsidiaries.
Specifically, the chief executive officer and the other executive officers are
responsible for:
a. producing, under the oversight of the Board and the Audit Committee,
financial statements for the Corporation and its consolidated subsidiaries that
fairly present the financial condition, results of operation, cash flows and
related risks in accordance with generally accepted accounting principles, for
making timely and complete disclosure to investors, and for keeping the Board
and the appropriate committees of the Board informed on a timely basis as to all
matters of significance;
b. developing and presenting the strategic plan, proposing amendments to
the plan as conditions and opportunities dictate and for implementing the plan
as approved by the Board;
c. developing and presenting the annual operating plans and budgets and for
implementing those plans and budgets as approved by the Board;
d. creating an organizational structure appropriate to the achievement of
the strategic and operating plans and recruiting, selecting and developing the
necessary managerial talent;
e. creating a working environment conducive to integrity, business ethics
and compliance with applicable legal and Corporate policy requirements;
f. developing, implementing and monitoring an effective system of internal
controls and procedures to provide reasonable assurance that: the Corporation's
transactions are properly authorized; the Corporation's assets are safeguarded
against unauthorized or improper use; and the Corporation's transactions are
properly recorded and reported. Such internal controls and procedures also shall
be designed to permit preparation of financial statements for the Corporation
and its consolidated subsidiaries in conformity with generally accepted
accounting principles and any other legally required criteria applicable to such
statements; and
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g. establishing, maintaining and evaluating the Corporation's disclosure
controls and procedures. The term "disclosure controls and procedures" means
controls and other procedures of the Corporation that are designed to ensure
that information required to be disclosed by the Corporation in the reports
filed by it under the Securities Exchange Act of 1934 (the "Act") is recorded,
processed, summarized and reported within the time periods specified in the
SEC's rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed by the Corporation in the reports it files under the Act is
accumulated and communicated to the Corporation's management, including its
principal executive and financial officers, to allow timely decisions regarding
required disclosure. To assist in carrying out this responsibility, management
has established a Disclosure Control Committee, whose membership is responsible
to the Audit Committee, to the chief executive officer and to the chief
financial officer, and includes the following officers or employees of the
Corporation: the president, the chief legal officer, the head of finance, the
chief information officer, the controller, the head of internal audit &
financial controls, the investor relations officer and the treasurer.
10. Meeting Procedures.
a. The Board shall determine whether the offices of chairman of the board
and chief executive officer shall be held by one person or by separate persons,
and whether the person holding the office of chairman of the board shall be
"independent" or not. An "independent" director meets the requirements for
"independence" as referenced in item 1.a above. "Non-management" directors
include those who are independent and those who, while not independent, are not
currently employees of the Corporation or one of its subsidiaries.
b. The chairman of the board will establish the agenda for each Board
meeting but the chairman of the board will include in such agenda any item
submitted by the presiding independent director (see item 11.c below). Each
Board member is free to suggest the inclusion of items on the agenda for any
meeting and the chairman of the board will consider them for inclusion.
c. Management shall be responsible to distribute information and data
necessary to the Board's understanding of all matters to be considered and acted
upon by the Board; such materials shall be distributed in writing to the Board
sufficiently in advance so as to provide reasonably sufficient time for review
and evaluation. To that end, management has provided each director with access
to a secure web site where confidential and sensitive materials may be viewed.
In circumstances where practical considerations do not permit advance
circulation of written materials, reasonable steps shall be taken to allow more
time for discussion and consideration, such as extending the duration of a
meeting or circulating unanimous written consent forms, which may be considered
and returned at a later time.
d. The chairman of the board shall preside over meetings of the Board.
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e. If the chairman of the board is not independent, the independent
directors may select from among themselves a "presiding independent director";
failing such selection, the chairman of the Nominating/Corporate Governance
Committee shall be the presiding independent director. The presiding independent
director shall be identified as such in the Corporation's annual proxy statement
to facilitate communications by stockholders and employees with the
non-management directors.
f. The non-management directors shall meet separately from the other
directors in regularly scheduled executive session, without the presence of
management directors and executive officers of the Corporation. The presiding
independent director shall preside over such meetings.
g. At least once per year the independent directors shall meet separately
from the other directors in a scheduled executive session, without the presence
of management directors, non-management directors who are not independent and
executive officers of the Corporation. The presiding independent director shall
preside over such meetings.
11. Committees.
a. The Board shall have an Audit Committee, a Compensation Committee and a
Nominating/Corporate Governance Committee which shall have the respective
responsibilities described in the attached exhibits. The membership of each such
committee shall consist only of independent directors.
b. The Board may, from time to time, appoint one or more additional
committees, such as a Dividend Committee.
c. The chairman of each Board committee, in consultation with the
appropriate members of management and staff, will develop the committee's
agenda. Management will assure that, as a general rule, information and data
necessary to the committee's understanding of the matters within the committee's
authority and the matters to be considered and acted upon by a committee are
distributed to each member of such committee sufficiently in advance of each
such meeting or action taken by written consent to provide a reasonable time for
review and evaluation.
d. At each regularly scheduled Board meeting, the chairman of each
committee or his or her delegate shall report the matters considered and acted
upon by such committee at each meeting or by written consent since the preceding
regularly scheduled Board meeting.
e. The secretary of the Corporation, or any assistant secretary of the
Corporation, shall be available to act as secretary of any committee and shall,
if invited, attend meetings of the committee and prepare minutes of the meeting
for approval and adoption by the committee.
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12. Reliance.
Any director of the Corporation shall, in the performance of such person's
duties as a member of the Board or any committee of the Board, be fully
protected in relying in good faith upon the records of the Corporation or upon
such information, opinions, reports or statements presented by any of the
Corporation's officers or employees, or committees of the Board, or by any other
person as to matters the director reasonably believes are within such other
person's professional or expert competence.
13. Reference to Corporation's Subsidiaries.
Where the context so requires, reference herein to the Corporation includes
reference to the Corporation and/or any direct or indirect subsidiary of the
Corporation whose financial results are consolidated with those of the
Corporation for financial reporting purposes and reference to a subsidiary of
the Corporation shall be reference to such a subsidiary.
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