Schedule 14A


Download 1.19 Mb.
NameSchedule 14A
page6/23
A typeSchedule
manual-guide.com > manual > Schedule
1   2   3   4   5   6   7   8   9   ...   23

Compensation Committee Interlocks and Insider Participation

None of the members of our Compensation Committee (i) has ever been an officer or employee of us, (ii) has any relationship requiring disclosure by us under SEC rules, or (iii) is an executive officer of another entity where one of our executive officers serves on the Board of Directors.

Director Independence

The board has determined that a majority of its members and a majority of its recommended director nominees are “independent” in accordance with NASDAQ standards. In determining the independence of our directors and director nominees, our Board of Directors considered information regarding the relationships between each director or director nominees and his or her family and us. Our Board of Directors made its determinations under the listing requirements of NASDAQ. The NASDAQ independence definition includes a series of objective tests, such as that the director or director nominee is not our employee and has not engaged in various types of business dealings with us. The NASDAQ definition also includes a subjective test. As required by the NASDAQ listing requirements, our Board of Directors made a subjective determination as to each independent director and director nominee that no relationships exist that, in the opinion of the Board of Directors, would interfere with each such director’s or director nominee’s exercise of independent judgment in carrying out the responsibilities of a director.

In making these determinations, our Board of Directors reviewed and discussed information provided by the directors and director nominees to us with regard to each such person’s business and personal activities as they may relate to us and our management. After reviewing the information presented to it, our Board of Directors concluded that Joe Arriola, Jane E. DeFlorio, Bruce Klatsky, Michael W. Rayden, J. David Scheiner and Alexandra Wilson each satisfied the NASDAQ standards of independence.

In addition to the NASDAQ standards for independence, the directors who serve on the Audit Committee and Compensation Committee each satisfy standards established by the SEC to qualify as “independent” for the purposes of serving on the Audit Committee and Compensation Committee, respectively. The SEC standards provide that members of the Audit Committee may not accept, directly or indirectly, any consulting, advisory, or other compensatory fee from us other than their director compensation and the SEC standards provide that any such consulting, advisory, or other compensatory fee be taken into account in determining the independence of Compensation Committee members.

 

14
Table of Contents

Shareholder Communication with the Board of Directors

Our Board of Directors has established a procedure that enables shareholders to communicate in writing with members of the Board of Directors. Any such communication should be addressed to Perry Ellis International, Inc., 3000 N.W. 107th Avenue, Miami, Florida 33172, Attention: General Counsel. Any such communication must state, in a conspicuous manner, that it is intended for distribution to the entire Board of Directors. Under the procedures established by our Board of Directors, upon receipt of such communications, our General Counsel will log receipt of such communications and send a copy of all communications that the General Counsel believes are bona fide and require attention to each member of our Board of Directors, identifying each one as a communication received from a shareholder. The General Counsel will also periodically provide our Board of Directors with a summary of all communications received and any responsive actions taken. Absent unusual circumstances, at the next regularly scheduled meeting of our Board of Directors held more than two days after a communication has been distributed, the Board of Directors will consider the substance of any communication that any director wants to discuss.

Corporate Governance Guidelines

The board has adopted Corporate Governance Guidelines. The Corporate Governance and Nominating Committee is responsible for overseeing these guidelines and making recommendations to the board concerning corporate governance matters. Among other matters, the guidelines address the following items concerning the board and its committees:

 

 



 

Director qualifications generally and guidelines on the composition of the board and its committees;

 

 



 

Director responsibilities and the standards for carrying out such responsibilities;

 

 



 

Board membership criteria;

 

 



 

Board committee requirements;

 

 



 

Director compensation;

 

 



 

Director access to management and independent advisors;

 

 



 

Director orientation and continuing education requirements; and

 

 



 

CEO evaluation, management succession and CEO compensation.

Majority Voting in the Election of Directors

In fiscal 2015, upon the recommendation of the Corporate Governance and Nominating Committee, the board amended the Corporate Governance Guidelines to provide for majority voting in the election of directors at uncontested meetings of shareholders, preserving plurality voting in the election of directors at contested meetings of shareholders. Specifically, our Corporate Governance Guidelines provide that, in an uncontested election, a nominee for director is elected only if such nominee receives the affirmative vote of the majority of the votes cast with respect to such candidate at any meeting for the election of directors at which a quorum is present (meaning that the votes cast “for” a candidate’s election must exceed the votes cast “against” that candidate’s election). The majority voting standard would not apply in contested elections, which means an election in which the number of director nominees exceeds the number of directors to be elected at the meeting.

Corporate Governance Practices

The board has adopted best practices in corporate governance. Examples of the board’s commitment to best practices in corporate governance are the following:

 

 



 

Majority Voting: In accordance with the revised corporate governance guidelines we adopted in June 2014, directors who do not receive a majority of the votes cast in an uncontested election are required

 

15
Table of Contents

 

to tender their resignations to the Corporate Governance and Nominating Committee, which then decides whether to recommend to the board that such resignation be accepted.

 

 



 

Stock Ownership Policy: We have stock ownership guidelines requiring senior executive officers and outside directors to hold our common stock with a value of at least one to five times their base salary, depending on position, and three times their annual cash retainer, respectively.

 

 



 

Hedge / Pledge Policy: The board adopted restrictions on engaging in hedging transactions involving our common stock and on pledging such common stock, in each case, by our directors and senior executive officers.

 

 



 

Clawback Policy: The board adopted a clawback policy which covers all senior executive officers and provides for the potential recoupment of incentive-based compensation under specified circumstances.

 

 



 

Related Party Transactions Policy: The board adopted a related party transactions policy to further refine its procedures and ensure that related party transactions continue to be appropriately scrutinized and reviewed.

Role of Board of Directors in Risk Oversight

We have a comprehensive enterprise risk management process in which management is responsible for managing our risks and the board and its committees provide review and oversight in connection with these efforts. Risks are identified, assessed and managed on an ongoing basis by management and addressed during periodic senior management meetings, resulting in both board and committee discussions and public disclosure, as appropriate. The board is responsible for overseeing management in the execution of its risk management responsibilities and for reviewing our approach to risk management. The board administers this risk oversight function either through the full board or through one of its standing committees, each of which examines various components of our enterprise risks as part of its responsibilities. An overall review of risk is inherent in the board’s consideration of our long and short term strategies, acquisitions and significant financial matters. The Audit Committee oversees financial risks (including risks associated with accounting, financial reporting, enterprise resource planning, and collectability of receivables), legal and compliance risks, and other risk management functions. The Compensation Committee considers risks related to the attraction and retention of talent and risks relating to the design of compensation programs and arrangements, including a periodic review of such compensation programs to ensure that they do not encourage excessive risk-taking. The Investment Policy Committee considers risks related to the retirement and pension plan and 401(k) plan. The Corporate Governance and Nominating Committee considers risks related to the recruitment and retention of directors with the appropriate background to oversee, counsel and direct management, risks related to management succession planning and overall corporate governance practices.

The Board of Directors is responsible for overseeing the design of the risk management process and, in that regard, created an Enterprise Risk Management Committee (“ ERM Committee ”), a non-board committee under the supervision of our CEO, to centrally coordinate the comprehensive enterprise risk management process. The ERM Committee has a top risks plan that is reviewed at least semi-annually by the ERM Committee. The ERM Committee reviews our programs and processes related to risk management, and the individuals responsible for them. The ERM Committee categorizes enterprise risk into five categories: Financial/Reporting, Compliance and Legal, Strategic and External, Operational, and Technology, and then reviews and analyzes the likelihood, impact, inherent risk and residual risk for all identified risks. Included in the review is the identification of the top concerns, assessment of their possible impact and probability, and identification of the responsible risk owner. The ERM Committee regularly assesses, monitors and re-evaluates our risks and provides regular updates to the Board of Directors and its committees, as applicable.

 

16
Table of Contents

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Related Party Transactions

Pursuant to our written Related Party Transaction Policy, our Corporate Governance and Nominating Committee and Audit Committee share the responsibility for the review and approval of “related party transactions” between us and our executive officers, directors or other related persons including the transactions described below. The policy applies to any person who is or was a director, officer, nominee for director or 5% or greater shareholder of us since the beginning of our last fiscal year and their immediate family members. In reviewing the proposed transaction, the approving committee will consider all relevant facts and circumstances, including without limitation (i) the business reasons for us to enter into the transaction; (ii) the benefit and perceived benefit, or lack thereof, of the transaction to us, (iii) the commercial reasonableness of the terms of the transaction; (iv) the materiality of the transaction to us; (v) whether the terms of the transaction are fair to us and on the same basis as would apply if the transaction did not involve a related party; (vi) the extent of the related party’s direct or indirect interest in the transaction; (vii) if applicable, the impact of the transaction on a non-employee director’s independence; (viii) the actual or apparent conflict of interest of the related party participating in the transaction; and (ix) any other transactions currently in effect involving the same related party. We do not consider the following types of transactions to involve a material interest on the part of the related party and will not review, nor will we require approval or ratification, under the Related Party Transaction Policy of (i) transactions in which the related party’s interest derives solely from his or her service as a director of another corporation or organization that is a party to the transaction; (ii) transactions in which the related party’s interest derives solely from his or her ownership of less than 10% of the equity interests in another person (other than a general partnership interest) that is a party to the transaction; (iii) transactions in which the related party’s interest derives solely from his or her ownership of a class of equity securities of the Company and all holders of that class of equity securities will receive the same benefit on a pro rata basis; (iv) transactions in which the related party’s interest derives solely from his or her service as a director, trustee or officer (or similar position) of a not-for-profit organization or charity that receives donations from us, which donations are made pursuant to our policies and approved by persons other than the related party; (v) compensation arrangements of any executive officer of the Company, if such arrangements have been approved by the Compensation Committee of the board or its delegate; (vi) director compensation arrangements, if such arrangements have been approved by the board; and (vii) transactions involving less than $30,000 in amount. The approving committee will not approve or ratify a transaction unless it will have determined that, upon consideration of all relevant information, the proposed transaction is in, or not inconsistent with, the best interests of us and our shareholders. It is the responsibility of each director and executive officer to bring any related party transactions to our attention before we enter into the transaction. In addition, we circulate written questionnaires to our executive officers and directors each year that ask for information about related party transactions. In reviewing and approving related party transactions, directors of the approving committee who do not have an interest in the transaction consider the relevant facts and determine whether the transaction is not less favorable to us than could have been obtained by us in arm’s-length negotiations with unaffiliated persons.

The Company was founded by brothers George and Isaac Feldenkreis. Since the Company was founded approximately 50 years ago, the Feldenkreis family has played an active role in the Company. Since 1967, three generations of the Feldenkreis family have worked at Perry Ellis. Even though the Company’s initial public offering in 1993 occurred more than two decades ago, the Feldenkreis family has continued to maintain a very substantial equity ownership in the Company and currently has beneficial ownership of more than 20% of our issued and outstanding equity.

Since 1967, George Feldenkreis and a number of his family members have served the Company in key management positions. In addition to George Feldenkreis’ position as our Executive Chairman, his son, Oscar Feldenkreis, serves as our Vice Chairman, CEO/President, and Fanny Hanono, his daughter, has worked for us since 1988, serving the Company in a variety of managerial capacities. Ms. Hanono currently serves as our Executive Vice President – Administration where, among other responsibilities, she oversees the Company’s real

 

17
Table of Contents

estate facilities, logistics, procurement, customs compliance programs and management of our foreign offices. During fiscal 2016, Ms. Hanono received approximately $314,953 in salary and benefits, plus the value of approximately $55,060 of time-vested restricted stock granted under the Fiscal 2016 LTI Plan, which vests over three years. The Company employs other members of the extended Feldenkreis family, but none of these employees received total compensation in an amount more than $120,000 during fiscal 2016.

The Company leases approximately 16,000 square feet for administrative offices, and leased approximately 50,000 square feet for warehouse distribution and retail, at facilities owned by our Executive Chairman, George Feldenkreis. These facilities were designed specifically for use by the Company and are in close proximity to our Miami, Florida headquarters. During the first half of fiscal 2015, we amended the existing ten-year leases to extend the term for five years, beginning July 1, 2014 and expiring June 30, 2019. Pursuant to those amendments, beginning July 1, 2014, the basic monthly rent became $41,750 and increases 3% on the first month of each of the remaining 12-month periods during the extended term. Rent expense, including insurance and taxes, for these leases amounted to approximately $487,000, or $9.87 per square foot, for fiscal 2016. Prior to the Company entering into the amended leases, our Corporate Governance and Nominating Committee, taking into consideration information from independent third party sources, reviewed the terms of the lease extensions. In October 2014, we transitioned our operations out of the warehouse space. In order to minimize the costs associated with an early termination of the lease relating to the warehouse and retail space, we engaged a real estate broker to assist us in finding a replacement tenant and agreed to be responsible for the related brokerage fees incurred of approximately $215,000. The retained broker identified a new tenant for the warehouse and retail space that is unrelated to the Company and we entered into a lease termination agreement relating to the warehouse and retail space on April 13, 2015. We incurred $180,000 of lease termination fees, including costs related to certain tenant improvements such as painting the interior and exterior of the building and improvements to the parking lot, which were agreed upon in order to induce the new tenant to lease the space and allow us to terminate the lease prior to its expiration.

In the first month of fiscal 2016, we chartered an aircraft from a third-party aircraft charter business that in turn chartered an aircraft from a third-party entity owned by our Executive Chairman and CEO/President. We paid this third-party entity $42,000 for fiscal 2016 in connection with the lease of the aircraft from the third-party entity owned by our Executive Chairman and CEO/President. Although we still charter aircraft from the same third-party aircraft charter business, the aircraft we charter is no longer the one owned by our Executive Chairman and CEO/President.

We are a party to licensing agreements with Isaco International, Inc. (“Isaco”), pursuant to which Isaco was granted the exclusive license to use the Perry Ellis and John Henry brand names in the United States and Puerto Rico to market a line of men’s underwear, hosiery and loungewear. We have been party to a licensing relationship with Isaco with respect to men’s underwear, hosiery and loungewear since 1995 and that licensing relationship predates our acquisition of the Perry Ellis and John Henry brands in 1999. The principal shareholder of Isaco is the father-in-law of Oscar Feldenkreis, our CEO/President. Royalty income earned from the Isaco license agreements amounted to $2.1 million for fiscal 2016. Advertising reimbursements from the Isaco license agreements amounted to approximately $500,000 for fiscal 2016. We buy licensed product from our numerous licensees to complement our direct-to-consumer product offerings for our retail stores and ecommerce sale. In fiscal 2016, we purchased approximately $700,000 of licensed products from Isaco to fulfill our direct-to-consumer business needs.

For fiscal 2016, we paid approximately $900,000 in insurance policy premiums for insurance to Sprezzatura Insurance Group LLC, an insurance intermediary company, from independent third-party insurance companies related to property and casualty, including cargo, employment practices, privacy and network liability, fiduciary, commercial crime, commercial accident and travel, kidnap and ransom, and comprehensive coverage of all of our foreign offices including liability and property coverage. Joseph Hanono, the grandson of George Feldenkreis, our Executive Chairman , is the President of the Sprezzatura Insurance Group. The policy premiums for the insurance secured for the Company by the Sprezzatura Insurance Group represents approximately 7.6% of the Company’s total annual insurance premiums.

 

18
Table of Contents
1   2   3   4   5   6   7   8   9   ...   23

Related:

Schedule 14A iconSchedule 14A (Rule 14a-101)

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A

Schedule 14A iconSchedule 14A




manual


When copying material provide a link © 2017
contacts
manual-guide.com
search