Lifetime Brands, Inc DEF 14A, filed Apr 25, 2025
Lifetime Brands, Inc (LCUT)
About this DEF 14A
Lifetime Brands, Inc filed this DEF 14A on April 25, 2025.
Table of Contents
Table of Contents
Table of Contents
| MESSAGE FROM THE CHAIRMAN OF THE
|
|
|
|
Dear Fellow Stockholder:
I invite you to participate in our Annual Meeting of Stockholders (the “Annual Meeting”) on Wednesday, June 18, 2025 at 10:30 a.m. Eastern Time, which will be virtual only and conducted via live webcast at meetnow.global/MPQPCDJ. Information on how to participate in the Annual Meeting can be found on page 9 of the Proxy Statement.
At the Annual Meeting, you will be asked: to elect a board of ten directors; to ratify the appointment of our independent registered public accounting firm; and to approve the 2024 compensation of the Company’s named executive officers.
We are taking advantage of the Securities and Exchange Commission rules that allow companies to provide their stockholders with access to proxy materials over the Internet. On or about April 25, 2025, we will release a Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders informing them that our Proxy Statement, Annual Report for the fiscal year ended December 31, 2024 (the “2024 Annual Report”) and voting instructions for the Annual Meeting are available online. As more fully described in that Notice, all stockholders may choose to access our proxy materials on the Internet or may request to receive paper copies of the proxy materials. This allows us to conserve natural resources and reduces the costs of printing and distributing the proxy materials, while providing our stockholders with access to the proxy materials in a fast and efficient manner. You can also visit our website, www.lifetimebrands.com, where you will find this Proxy Statement and our 2024 Annual Report, free of charge.
On behalf of our directors and our management team, I thank you for your continued support of Lifetime Brands.
Best regards,
/s/ Jeffrey Siegel
Jeffrey Siegel
Chairman of the Board of Directors
April 25, 2025
1
Table of Contents
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on June 18, 2025: On or about April 25, 2025, we will release the Notice of Internet Availability of Proxy Materials to our stockholders advising them that this Proxy Statement, the 2024 Annual Report and voting instructions for the Annual Meeting can be accessed over the Internet at www.envisionreports.com/LCUT. You may then access these proxy materials over the Internet, or you may request that a printed copy of the materials be sent to you. If you want to receive a paper or e-mail copy of these proxy materials, you must request one over the Internet at www.envisionreports.com/LCUT, by calling toll free 1-866-641-4276, or by sending an e-mail to investorvote@computershare.com with “Proxy Materials Lifetime Brands, Inc.” in the subject line. There is no charge to you for requesting a copy.
2
Table of Contents
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 18, 2025, 10:30 a.m. Eastern Time
1000 Stewart Avenue, Garden City, New York 11530
Notice is hereby given that the Annual Meeting of Stockholders of Lifetime Brands, Inc., a Delaware corporation (the “Company”), will be held online via live webcast at meetnow.global/MPQPCDJ on Wednesday, June 18, 2025 at 10:30 a.m. Eastern Time (the “Annual Meeting”), for the following purposes:
| (1) | To elect a board of directors of the ten nominees named in the accompanying Proxy Statement, each to serve until the 2026 Annual Meeting of Stockholders and until their respective successors are duly elected and qualified; |
| (2) | To ratify the appointment of Ernst & Young LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2025; and |
| (3) | To approve, on a non-binding advisory basis, the 2024 compensation of the Company’s named executive officers. |
In addition to the foregoing, the Annual Meeting will include the transaction of such other business as may properly come before the meeting, or any adjournment(s), continuation(s), rescheduling(s) or postponement(s) thereof.
Stockholders of record at the close of business on April 22, 2025 (the “Record Date”) are entitled to notice of and to vote at the Annual Meeting and any adjournment(s), continuation(s), rescheduling(s) or postponement(s) thereof. A complete list of the stockholders entitled to vote at the Annual Meeting may be accessed electronically, upon request, starting ten (10) days prior to the Annual Meeting by contacting our Corporate Secretary via email at sara.shindel@lifetimebrands.com.
The Annual Meeting will be held online only via live webcast and there will be no physical location for stockholders to attend the Annual Meeting. Stockholders will be able to vote electronically and submit questions prior to the Annual Meeting by logging in at meetnow.global/MPQPCDJ and entering their 15-digit control number or may vote and ask questions during the Annual Meeting by logging in and entering the required information at the meeting date and time. Guests may log in to the website and virtually attend the Annual Meeting, but only stockholders who have 15-digit control numbers will be able to vote and ask questions.
By Order of the Board of Directors,
/s/ Sara Shindel
Sara Shindel
Executive Vice President, General Counsel and Corporate Secretary
Garden City, New York
April 25, 2025
3
Table of Contents
Forward-Looking Statements
The Company cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Proxy Statement involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company’s control. Words such as “approximate,” “outlook,” “estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “goal,” “should,” and similar expressions may identify forward-looking statements. The following factors, in addition to those disclosed in “ITEM 1A. RISK FACTORS” of our 2024 Annual Report and in our other filings made with the SEC could cause actual results to differ materially from those expressed or implied in any of the forward-looking statements included in this Proxy Statement: the imposition of duties and tariffs and other trade policies and/or economic sanctions implemented by the U.S. and other governments; social unrest, including related protests and disturbances; the emergence, continuation and consequences of geopolitical conflicts including: macro-economic challenges, including labor disputes, inflationary impacts and disruptions to the global supply chain; failure to protect our reputation; or ability to attract or retain talent. There can be no assurance that the forward-looking statements included in this Proxy Statement will prove to be accurate, and new risks may emerge from time to time. Except as may be required by applicable law, the Company assumes no obligation to publicly update or revise our forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.
Incorporation by Reference
Neither the Report of the Compensation Committee on Executive Compensation nor the Report of the Audit Committee included herein shall be deemed soliciting material or filed with the SEC and neither of them shall be deemed incorporated by reference into any prior or future filings made by us under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), except to the extent that we specifically incorporate such information by reference.
In addition, this document includes several website addresses. These website addresses are intended to provide inactive, textual references only. The information on these websites is not part of this Proxy Statement.
Table of Contents
4
Table of Contents
PROXY STATEMENT SUMMARY
2024 PERFORMANCE
The Company’s financial results for 2024 included the following:
| • | Net sales were $683.0 million in 2024, as compared to net sales of $686.7 million in 2023. |
| • | Adjusted income from operations(1) was $44.7 million in 2024, as compared to $48.9 million in 2023. |
| • | Net loss was $(15.2) million in 2024, as compared to a net loss of $(8.4) million in 2023. |
| • | Adjusted net income(1) was $12.6 million in 2024, as compared to $11.0 million in 2023. |
| • | Adjusted EBITDA(1) was $55.4 million in 2024, as compared to $57.3 million in 2023. |
(1) These amounts represent non-GAAP financial measures. A reconciliation of these measures to the most directly comparable GAAP measure is included in Appendix A.
VOTING MATTERS & BOARD RECOMMENDATIONS
| Proposal No. | Proposal | Board Recommends | ||
| 1 | To elect a board of directors of the ten nominees named in this Proxy Statement, each to serve until the 2026 Annual Meeting of Stockholders and until their respective successors are duly elected and qualified. |
FOR each nominee | ||
| 2 | To ratify the appointment of Ernst & Young LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2025. |
FOR | ||
| 3 | To approve, on a non-binding advisory basis, the 2024 compensation of the Company’s named executive officers. |
FOR | ||
BOARD NOMINEES AND COMMITTEE ASSIGNMENTS
There are ten director nominees for election at our Annual Meeting. Each nominee will hold office until the 2026 Annual Meeting of Stockholders and until their respective successors are duly elected and qualified. All of the nominees are currently serving as directors of the Company and all nominees, other than Mr. Jeffrey H. Evans, were elected to the Board of Directors (the “Board”) at the 2024 Annual Meeting of Stockholders. On January 17, 2025, the Board approved increasing the size of the Board from nine to ten directors and appointed Mr. Evans to fill such vacancy and serve as an independent director on the Board of the Company.
| Name | Age | Main Occupation | Joined Board | Committee Assignment | ||||||||
| Jeffrey Siegel |
82 | Chairman of the Board1 | 1967 | Chairman, Exec (Chair), ESG | ||||||||
| Robert B. Kay |
63 | CEO, Lifetime Brands, Inc. | 2018 | Exec, ESG | ||||||||
| Jeffrey H. Evans |
56 | Former Executive Vice President, Entertainment, Toys, and Seasonal, Walmart U.S. | 2025 | |||||||||
| Rachael A. Jarosh |
56 | Former President and CEO, Enactus | 2020 | Nom/Gov, Comp, ESG | ||||||||
| Cherrie Nanninga |
76 | Partner, Real Estate Solutions Group, LLC | 2003 | Nom/Gov, Comp (Chair) | ||||||||
| Craig Phillips |
74 | Retired, Senior VP – Distribution, Lifetime Brands, Inc. | 1974 | Audit | ||||||||
| Veronique Gabai-Pinsky |
59 | Former Global President, The Vera Wang Group | 2020 | ESG (Chair) | ||||||||
| Bruce G. Pollack |
66 | Managing Partner, Centre Partners Management LLC | 2018 | Nom/Gov, Comp | ||||||||
| Michael J. Regan* |
83 | Retired Certified Public Accountant | 2012 | Nom/Gov (Chair), Audit (Chair) | ||||||||
| Michael Schnabel |
47 | Senior Partner, Centre Partners Management LLC | 2018 | Audit | ||||||||
Abbreviations: Nom/Gov = Nominating/Governance Committee; Audit = Audit Committee; Comp = Compensation Committee; Exec = Executive Committee; ESG = ESG Committee
* Independent Lead Director
1 Mr. J. Siegel formerly served as Executive Chairman of the Company, until March 31, 2023.
2 Mr. Phillips retired and resigned as Senior Vice-President – Distribution of the Company, effective January 2, 2015.
5
Table of Contents
BOARD COMPOSITION
Our Board currently consists of ten members. Three directors self-identified as female and one director self-identified as racially and ethnically diverse.
CORPORATE GOVERNANCE PRACTICES
Our corporate governance practices include the following best practices:
| ● | corporate governance guidelines; |
| ● | a majority vote director resignation policy; |
| ● | a declassified Board, with the annual election of directors; |
| ● | a compensation philosophy for named executive officers aligning compensation with short-term and long-term performance, including drivers of stockholder value; |
| ● | stock ownership guidelines for directors; |
| ● | stock ownership guidelines for our named executive officers; |
| ● | stockholders can take action by written consent; |
| ● | anti-hedging provisions; |
| ● | our Clawback Policy (as defined below); |
| ● | stockholders have the right to remove directors with or without cause; |
| ● | our strong corporate citizenship, including our donation practices, our partnership with organizations and our avoidance of the use of conflict minerals; and |
| ● | our Code of Business Conduct and Ethics. |
SUSTAINABILITY
We believe that our practices and procedures should align, where practicable, with our sustainability strategies. We continue to formalize some of the ways we manage sustainability-related activities. The Board formed an ESG Committee in 2021 that is tasked with overseeing the Company’s overall ESG strategy. The ESG Committee considers strategies relevant to the Company’s sustainability practices in a manner aligned with the Company’s overall business strategy. The ESG Committee also oversees and monitors the Company’s strategies relating to human capital management. Where appropriate, the ESG Committee liaises with the full Board on risk management relevant to sustainability and ESG matters.
The Company has successfully implemented strategies during 2024 such as donating products to soup kitchens near our major offices under the Lifetime Cares program and participating in the How2Recycle initiative to provide consistent and transparent on-package disposal instructions for consumers.
In an effort to align sustainability initiatives with our business strategy, the Company expects to continue to engage in the following practices:
| • | track the Company’s use of environmentally-preferred materials in products and packaging; |
| • | meet quarterly with all product design leaders to discuss best practices for using environmentally-preferred materials; |
| • | introduce products with environmentally-preferred materials where practicable; |
| • | reduce the size of packaging and increase the use of recycled materials and recyclable packaging where practicable; |
| • | collaborate with vendors who possess technical expertise in reducing emissions; |
| • | utilize quality management software to track our existing suppliers’ use of environmentally-preferred materials and practices; |
| • | track and reduce shipping materials from our warehouses for our drop-ship and direct-to-consumer business; |
| • | recycle warehouse materials such as corrugate and pallets; and |
| • | solicit consumer feedback on their preferences for environmentally-preferred products. |
6
Table of Contents
THE BOARD OF DIRECTORS EXTENDS A CORDIAL INVITATION TO ALL STOCKHOLDERS TO PARTICIPATE IN THE ANNUAL MEETING ONLINE VIA LIVE WEBCAST AT MEETNOW.GLOBAL/MPQPCDJ. WHETHER OR NOT YOU PLAN TO PARTICIPATE IN THE ANNUAL MEETING, IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED. PLEASE VOTE YOUR SHARES USING THE INTERNET OR THE DESIGNATED TOLL-FREE TELEPHONE NUMBER, OR BY REQUESTING A PRINTED COPY OF THE PROXY MATERIALS AND COMPLETING AND RETURNING BY MAIL THE PROXY CARD OR VOTING INSTRUCTION FORM YOU WILL RECEIVE IN RESPONSE TO YOUR REQUEST. STOCKHOLDERS WHO HAVE SUBMITTED COMPLETED PROXY CARDS OR VOTING INSTRUCTION FORMS MAY REVOKE THEIR PROXIES AND VOTE DURING THE ANNUAL MEETING.
LIFETIME BRANDS, INC.
1000 Stewart Avenue,
Garden City, New York 11530
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To be held on June 18, 2025
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Lifetime Brands, Inc., a Delaware corporation (the “Company,” “us” or “we”), for use at our Annual Meeting of Stockholders (the “Annual Meeting”) to be held on June 18, 2025 at 10:30 a.m. Eastern Time online via live webcast at meetnow.global/MPQPCDJ. Stockholders of record at the close of business on April 22, 2025 (the “Record Date”) are entitled to notice of and to vote at the Annual Meeting.
On or about April 25, 2025, we will first release the Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders advising them that this Proxy Statement, the 2024 Annual Report and voting instructions for the Annual Meeting can be accessed over the Internet at www.envisionreports.com/LCUT. You may then access these proxy materials over the Internet, or you may request that a printed copy of the materials be sent to you. If you want to receive a paper or e-mail copy of these proxy materials, you must request one over the Internet at www.envisionreports.com/LCUT, by calling 1-866-641-4276 toll free, or by sending an e-mail to investorvote@computershare.com with “Proxy Materials Lifetime Brands, Inc.” in the subject line. There is no charge to you for requesting a copy.
THE ANNUAL MEETING
On April 22, 2025, there were 22,414,005 shares of the Company’s common stock, $0.01 par value, issued and outstanding. Each share of the Company’s common stock entitles the holder thereof to one vote on each matter submitted to a vote of stockholders at the Annual Meeting.
All shares of common stock represented by properly executed proxies or voting instruction forms will be voted at the Annual Meeting in accordance with the directions marked on the proxies or voting instruction forms, unless such proxies or voting instruction forms have previously been revoked. If no directions are indicated on such proxies or voting instruction forms, they will be voted FOR Proposal 1 – the election of each nominee named under Election of Directors, FOR Proposal 2 – the ratification of the appointment of Ernst & Young LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2025, and FOR Proposal 3 – the approval, on a non-binding advisory basis, of the 2024 compensation of the Company’s named executive officers. If any other matters are properly presented at the Annual Meeting for action, the proxy holders will vote the proxies (which confer discretionary authority upon such holders to vote on such matters) in accordance with their best judgment, subject to compliance with Rule 14a-4(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Each proxy executed and returned by a stockholder by any of the methods indicated below may be revoked at any time before it is voted by timely submission of a written notice of revocation or by submission of a duly executed proxy bearing a later date (in either case directed to the Corporate Secretary of the Company), or, if a stockholder participates online in the Annual Meeting, he or she may elect to revoke his or her proxy and vote his or her shares personally.
7
Table of Contents
VOTE REQUIRED FOR APPROVAL
A majority of our outstanding shares of common stock present at the Annual Meeting, by virtual participation or by proxy, and entitled to vote shall constitute a quorum. Abstentions and broker non-votes will be counted for purposes of determining the presence or absence of a quorum. Assuming a quorum is present, (1) directors shall be elected by a plurality of the votes cast in the election of directors, (2) the affirmative vote of a majority of the shares present at the Annual Meeting, by virtual participation or by proxy, and entitled to vote is necessary to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm, and (3) the affirmative vote of a majority of the shares present at the Annual Meeting, by virtual participation or by proxy, and entitled to vote is necessary to approve, on a non-binding advisory basis, the compensation of the Company’s named executive officers.
With respect to Proposal 1, you may vote for all nominees, withhold your vote as to all nominees, or vote for all nominees except those specific nominees from whom you withhold your vote. The ten nominees receiving the most “FOR” votes will be elected. Properly executed proxies marked “WITHHOLD” with respect to the election of one or more directors will not be voted with respect to the director or directors indicated. Proxies may not be voted for more than ten directors and stockholders may not cumulate votes for the election of any directors.
With respect to Proposals 2 and 3, you may vote for, against or abstain from voting on any of these proposals.
If a stockholder, present by virtual participation or by proxy, abstains on a matter, such stockholder’s shares of common stock, although included in the quorum, will not be voted on such matter. Thus, an abstention from voting on Proposal 2 or 3 has the same effect as a vote “against” the matter.
Brokers, banks or other nominees who hold shares of our common stock for a beneficial owner have the discretion to vote on routine proposals when they have not received voting instructions from the beneficial owner. Applicable rules prohibit brokers from voting on Proposals 1 and 3 without receiving instructions from the beneficial owner of the shares. Brokers may vote on Proposal 2 absent instructions from the beneficial owner.
A broker non-vote occurs when a broker or other nominee does not receive voting instructions from the beneficial owner and does not have the discretion to direct the voting of the shares. Broker non-votes will be counted for purposes of calculating whether a quorum is present at the Annual Meeting, but, in the absence of instructions, shares subject to such broker non-votes will not be counted for purposes of determining the number of votes present by virtual participation or represented by proxy and entitled to vote with respect to a particular proposal. Thus, a broker non-vote will not impact our ability to obtain a quorum.
In determining whether a proposal has received the requisite number of votes, broker non-votes will have no effect on the outcome of the vote on a proposal that requires a plurality of votes cast (Proposal 1) and will have no effect on the outcome of the vote on a proposal that requires the affirmative vote of a majority of the shares present at the Annual Meeting, by virtual participation or by proxy, and entitled to vote (Proposals 2 and 3).
HOW TO VOTE
You may vote your shares by one of the following methods:
INTERNET: To vote your shares by Internet, please visit the website listed on your proxy card or voting instruction form and follow the on-screen instructions. If you vote by Internet, you do not need to mail your proxy card or voting instruction form.
TELEPHONE: To vote your shares by telephone, please follow the instructions on your proxy card or voting instruction form. If you vote by telephone, you do not need to mail your proxy card or voting instruction form.
MAIL: To vote your shares by mail, please follow the instructions on your proxy card or voting instruction form. Please be sure to sign and date your completed proxy card or voting instruction form before mailing. If you do not sign your proxy card or voting instruction form, your votes cannot be counted. Please mail your proxy card or voting instruction form in the pre-addressed, postage-paid envelope.
VOTE ONLINE DURING THE MEETING: You may vote online during the Annual Meeting by visiting the link meetnow.global/MPQPCDJ. If you are the registered holder of your shares, meaning that you hold your shares through Computershare Investor Services (“Computershare”), our transfer agent, you do not need to register in advance for the Annual Meeting. The 15-digit control number provided on your Notice, proxy card or voting instruction form is necessary to access this site. If you hold your shares in “street name,” meaning that you hold your shares through a broker, bank or
8
Table of Contents
other nominee, please follow the directions below to register in advance for the Annual Meeting. Guests may virtually attend the Annual Meeting but will not be able to vote during the Annual Meeting.
PARTICIPATING IN THE ANNUAL MEETING
You are entitled to participate in the Annual Meeting only if you were a stockholder of record or a beneficial owner of shares of our common stock as of the close of business on the Record Date, April 22, 2025, or you hold a valid proxy for the Annual Meeting. Our Annual Meeting will be a completely virtual meeting. There will be no physical meeting location. The meeting will be conducted only via live webcast. Guests may virtually attend the meeting but will not be able to vote or ask questions.
You will be able to virtually attend the Annual Meeting, examine our shareholder list, and submit your questions during the meeting by visiting meetnow.global/MPQPCDJ. You also will be able to vote your shares online by participating in the Annual Meeting.
To participate in the Annual Meeting, visit meetnow.global/MPQPCDJ and enter the 15-digit control number included on your Notice of Internet Availability of Proxy Materials, on your proxy card or on the instructions that accompanied your proxy materials. If you hold your shares in “street name,” please contact the broker, bank, or other nominee that holds your shares to receive proof of your beneficial ownership (legal proxy) and submit such proof, along with your name and email information, to Computershare in advance of the Annual Meeting no later than 5:00 p.m. Eastern Time on June 6, 2025. Requests for registration must be labeled as “Legal Proxy,” and may be submitted (i) via email to legalproxy@computershare.com by forwarding the email from your broker regarding your beneficial ownership or sending an image of your legal proxy, or (ii) sending proof of your beneficial ownership via mail to: Computershare, Lifetime Brands, Inc. Legal Proxy, P.O. Box 43001, Providence, Rhode Island 02940-3001. Upon receipt of such proof of beneficial ownership, Computershare will then register you for virtual attendance at the Annual Meeting and provide you with an email confirming your registration.
The Annual Meeting will begin promptly at 10:30 a.m. Eastern Time on June 18, 2025. Participants should also give themselves plenty of time to log in and ensure that they can hear streaming audio prior to the start of the Annual Meeting. Help and technical support for accessing and participating in the virtual meeting will be available by following the instructions on the virtual meeting website.
If you are a stockholder and wish to submit questions prior to or during the Annual Meeting, log into the virtual meeting platform at meetnow.global/MPQPCDJ. Questions pertinent to meeting matters will be answered during the meeting, subject to time constraints. To ensure the meeting is conducted in a manner that is fair to all stockholders, the chair of the meeting may exercise broad discretion in recognizing stockholders who wish to participate, the order in which questions are asked, and the amount of time devoted to any one question. We reserve the right to edit or reject questions we deem inappropriate. By virtually attending the Annual Meeting, stockholders agree to abide by the agenda and procedures for the Annual Meeting.
MAJORITY VOTING GOVERNANCE PRINCIPLE
Although our Bylaws provide for a plurality voting standard for the election of directors, our Board has adopted, as a governance principle, a majority voting standard for uncontested director elections and a plurality voting standard for contested director elections. For this purpose, a “majority of votes cast” means that the number of votes cast “for” a nominee’s election must exceed the number of votes cast “against” that nominee’s election. Accordingly, subsequent to the election of directors at the Annual Meeting, any elected director who is not elected by an affirmative vote of a majority of the votes cast at the Annual Meeting shall submit his or her resignation to our Board, to be effective upon the Board’s determination of whether to accept or reject the resignation. Upon receipt by our Board of such resignation, our Board shall, in its sole judgment and discretion, within 90 days from the submission of such director’s resignation as a director of the Company, determine whether to accept or reject such director’s resignation. If our Board rejects such director’s resignation as a director of the Company, then we shall prepare and file a Current Report on Form 8-K to explain our Board’s rationale for its rejection of such director’s resignation.
PROXY SOLICITATION
We will bear the cost of preparing, printing, assembling and mailing the Notice, form of proxy, this Proxy Statement, the 2024 Annual Report and other materials that may be sent to stockholders in connection with this solicitation. We have retained Georgeson, a proxy solicitation firm, at an anticipated cost of $10,000 plus reimbursement of expenses, to assist
9
Table of Contents
in soliciting proxies from brokers, banks, nominees, and institutional holders. Georgeson may solicit votes personally or by telephone, mail or electronic means. In addition, Georgeson and certain related persons will be indemnified against certain liabilities arising out of or in connection with the engagement.
It is contemplated that brokerage houses will forward the proxy materials to beneficial holders at our request. In addition to the solicitation of proxies by the use of mail, our officers and other employees may solicit proxies personally, by telephone or by electronic means without being paid any additional compensation. We will reimburse such persons for their reasonable out-of-pocket expenses.
10
Table of Contents
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial ownership of our common stock as of April 18, 2025 (except where otherwise noted) based on a review of information filed with the Securities and Exchange Commission (“SEC”) and our records with respect to (i) each person known to be the beneficial owner of more than 5% of the outstanding shares of our common stock, (ii) each of our directors, (iii) each of our named executive officers, and (iv) all our directors and named executive officers as a group.
| Name of beneficial owner | Number of shares beneficially owned |
Percent of shares beneficially owned* |
||||||||
| DIRECTORS AND EXECUTIVE OFFICERS (1) |
||||||||||
| Jeffrey Siegel |
1,216,261 (2) | 5.4% | ||||||||
| Robert B. Kay |
1,165,096 (3) | 5.1% | ||||||||
| Jeffrey H. Evans |
7,144 | † | ||||||||
| Rachael A. Jarosh |
56,074 | † | ||||||||
| Cherrie Nanninga |
100,837 | † | ||||||||
| Craig Phillips |
617,516 | 2.8% | ||||||||
| Veronique Gabai-Pinsky |
55,377 (4) | † | ||||||||
| Bruce G. Pollack |
6,059,679 (5) | 27.0% | ||||||||
| Michael J. Regan |
85,611 | † | ||||||||
| Michael Schnabel |
66,563 | † | ||||||||
| Daniel Siegel |
432,227 (6) | 1.9% | ||||||||
| Laurence Winoker |
122,836 | † | ||||||||
| All directors and named executive officers as a group (12 persons) |
9,985,221 | 43.6% | ||||||||
| Name of beneficial owner | Number of shares beneficially owned |
Percent of shares beneficially owned |
||||||||
| Centre Partners V, L.P. 780 Third Avenue, 41st Floor New York, New York 10017. |
5,993,116 (7) | 26.7% | ||||||||
| JB Capital Partners L.P. 5 Evan Place Armonk, New York 10504 |
1,248,121 (8) | 5.6% | ||||||||
| Mill Road Capital II, L.P. 382 Greenwich Avenue, Suite One Greenwich, Connecticut 06830 |
1,208,503 (9) | 5.4% | ||||||||
| Dimensional Fund Advisors LP 300 Bee Cave Road Austin, Texas 78746 |
1,141,319 (10) | 5.1% | ||||||||
Notes:
| * | Calculated on the basis of 22,414,005 shares of common stock outstanding as of April 18, 2025. Pursuant to the regulations of the SEC, shares are deemed to be “beneficially owned” by a person if such person directly or indirectly has or shares the power to vote or dispose of such shares. Each person is deemed to be the beneficial owner of shares which may be acquired within sixty days of April 18, 2025 through the exercise of options, warrants, and other rights, if any, and such securities are deemed to be outstanding for the purpose of computing the percentage of the class beneficially owned by such person. |
| † | Less than 1%. |
| (1) | The address of such individuals is c/o the Company, 1000 Stewart Avenue, Garden City, New York 11530. |
11
Table of Contents
| (2) | Consists of: (i) 1,140,251 shares owned directly by Mr. Jeffrey Siegel, (ii) 1,010 shares owned by Mr. Siegel’s wife, and (iii) 75,000 shares issuable upon the exercise of options that are exercisable within 60 days. |
| (3) | Consists of: (i) 699,096 shares owned directly by Mr. Kay, (ii) 66,000 shares that are indirectly owned in an irrevocable family trust, (iii) 21,816 shares issuable upon the exercise of options which are exercisable within 60 days, and (iv) 378,184 shares issuable upon the exercise of options that are indirectly owned in an irrevocable family trust that are exercisable within 60 days. |
| (4) | Consists of: (i) 51,877 shares owned directly by Ms. Gabai-Pinsky, and (ii) 3,500 shares owned by Ms. Gabai-Pinsky’s husband. |
| (5) | Consists of: (i) 66,563 shares owned directly by Mr. Pollack, (ii) 5,593,116 shares held by Taylor Parent (as defined below), and (iii) 400,000 shares held by Centre Capital Investors V, L.P. (“Centre Investors”). Centre Partners V, L.P. (“Centre Partners LP”) is the sole general partner of Centre Investors. CP Taylor GP, LLC (“CP Taylor”) has the authority to appoint the board of directors of Taylor Parent. Centre Partners LP is the sole member of CP Taylor and the general partner of Centre Investors. Centre Partners V LLC (“Centre Partners”) is the general partner of Centre Partners LP. JRJ V LP (“JRJ LP”) and Harwich Road V LP (“Harwich Road LP”) are co-managers of Centre Partners. JRJ Inc. (“JRJ”) is the general partner of JRJ LP. Harwich Road Inc. (“Harwich Road”) is the general partner of Harwich Road LP. Bruce G. Pollack is the president of JRJ. David Jaffe is the president of Harwich Road. As such, Centre Partners LP, Centre Partners, JRJ LP, Harwich Road LP, JRJ, Harwich Road, Bruce G. Pollack and David Jaffe may be deemed to beneficially own the shares of the Company owned directly by Centre Investors and CP Taylor, Centre Partners LP, Centre Partners, JRJ LP, Harwich Road LP, JRJ, Harwich Road, Bruce G. Pollack and David Jaffe may be deemed to beneficially own the shares of the Company owned directly by Taylor Parent. |
| (6) | Consists of: (i) 413,693 shares owned directly by Mr. D. Siegel, (ii) 8,400 shares owned by Mr. D. Siegel’s wife, and (iii)10,134 shares held as Uniform Transfer to Minors Act Custodian for children. |
| (7) | Based on Amendment No. 2 to Schedule 13D filed with the SEC on March 25, 2019 by Taylor Parent, CP Taylor, Centre Investors, Centre Partners LP, and Centre Partners in addition to the Form 4s filed with the SEC on behalf of Centre Partners LP and Mr. Pollack, respectively, on May 17, 2019 and June 24, 2024. Consists of: (i) 5,593,116 shares held by Taylor Parent, and (ii) 400,000 shares held by Centre Investors. See footnote 5 above for a further description of the beneficial ownership of these shares. |
| (8) | Based solely on Amendment No. 1 to Schedule 13G filed with the SEC on behalf of JB Capital Partners L.P. (“JB Capital”) and Alan W. Weber, as general partner, on February 10, 2025. Consists of: 1,248,121 shares beneficially owned by JB Capital and Mr. Weber. JB Capital Partners and Mr. Weber have shared voting and dispositive power with respect to 1,248,121 shares and sole voting and dispositive power with respect to zero shares. |
| (9) | Based solely on Amendment No. 12 to the Schedule 13D filed with the SEC on October 19, 2021. Represents shares owned by Mill Road Capital II, L.P. (“MR Capital Fund”). MR Capital Fund directly holds, and thus has sole voting and dispositive power over, 1,208,503 shares. Mill Road Capital II GP LLC (“MR Capital GP”), as sole general partner of MR Capital Fund, also has sole authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, the shares held on behalf of MR Capital Fund, and Thomas E. Lynch has shared authority to vote (or direct the vote of), and to dispose (or direct the disposal) of, these shares on behalf of MR Capital GP. Accordingly, each of MR Capital GP, MR Capital Fund, and Mr. Lynch (collectively, the “MR Reporting Persons”) beneficially owns 1,208,503 shares of common stock, and the MR Reporting Persons beneficially own, in the aggregate, 1,208,503 shares of common stock. |
| (10) | Based solely on Amendment No. 15 to the Schedule 13G filed with the SEC on February 9, 2024. Dimensional Fund Advisors LP has sole voting power with respect to 1,113,668 shares and sole dispositive power with respect to 1,141,319 shares, and shared voting and dispositive power with respect to zero shares. |
12
Table of Contents
Proposal No. 1
ELECTION OF DIRECTORS
Ten directors are proposed to be elected at the Annual Meeting to hold office until the 2026 Annual Meeting of Stockholders, and each director shall hold office until their successors are duly elected and qualified or until their earlier resignation or removal. Each of the nominees is one of our current directors.
With respect to Messrs. Kay, Pollack and Schnabel, as previously disclosed, the Company previously entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company; Taylor Parent; and Taylor Holdco, LLC, a Delaware limited liability company (dba Filament Brands, and which the Company refers to as “Filament”), and related entities, providing for an Agreement and Plan of Merger entered into on December 22,2017 for the acquisition of Filament by the Company (the “Filament Acquisition”). In connection with the Merger Agreement, the Company entered into a stockholders agreement (the “Stockholders Agreement”) by and among the Company, Taylor Parent and other related stockholders. Pursuant to the Merger Agreement and the Stockholders Agreement, the Company was required to appoint three Taylor Parent designees to the Board. On March 1, 2018, effective upon the closing of the Filament Acquisition, the Board unanimously voted to expand the Board and to appoint Messrs. Kay, Pollack and Schnabel to fill the newly created vacancies on the Board. Messrs. Kay, Pollack and Schnabel were subsequently elected to the Board by the Company’s stockholders at the 2018 through 2024 Annual Meetings and are standing for re-election to the Board at the Annual Meeting.
The following ten nominees have been recommended by the Board. It is the intention of the persons named as proxies in the enclosed proxy card to vote the shares covered thereby FOR the election of the ten persons named below, unless a proxy card received by them contains contrary instructions:
Director Nominees
|
Jeffrey Siegel is Chairman of the Board and has held this position since June 2001. Mr. Siegel served the Company in various capacities and has been a director of the Company since 1967. Mr. Siegel held the position of President from December 1999 to 2013, the position of Chief Executive Officer from December 2000 to March 2018 and the position of Executive Chairman from March 2018 until March 31, 2023. Mr. Siegel is a cousin of Craig Phillips, a member of the Board, and the father of Daniel Siegel, the Company’s President. |
|
|
|
Robert B. Kay is our Chief Executive Officer and has served in such role since the consummation of the Filament Acquisition in March 2018. Mr. Kay previously served as the Chairman and Chief Executive Officer of Filament from 2012 to 2018. Mr. Kay began his career at Deloitte & Touche where he spent six years as a management consultant. From 1993 until 1998, he served as the Senior Vice President and Chief Financial Officer of Oxford Resources Corp., a Nasdaq-listed consumer finance company. From 1999 to 2005, Mr. Kay was President and Chief Executive Officer of Key Components, Inc., a diversified industrial company. In 2006, Mr. Kay joined Kaz, Inc. as Executive Chairman until the company was sold to a publicly traded strategic buyer in 2010. Since 2005, Mr. Kay has been a member of the operating partner network of Centre Partners Management LLC, which, through its affiliates, beneficially owns a majority of the capital stock of Taylor Parent, LLC. Mr. Kay also serves on the board of Nearly Natural, LLC, a private portfolio company of Centre Partners Management LLC. | |
13
Table of Contents
| Jeffrey H. Evans is the Chief Commercial Officer for the Reebok brand at Galaxy Employee Corporation. Prior to that, Mr. Evans was the President/Chief Merchandising officer of At Home, a $2 billion home décor retailer, and also served in the Office of the CEO role in partnership with the COO and CFO, from 2023-2024. Before joining At Home, Mr. Evans spent 16 years with Walmart, from 2006-2022, where he held leadership roles in the Walmart US and Sam’s Club divisions, as Executive Vice President of Electronics, Toys and Seasonal for Walmart US from 2020 to 2022 and as Senior Vice President and General Merchandise manager for home/apparel categories for Walmart US from 2012-2020. Prior to his tenure at Walmart, Mr. Evans began his career at Filene’s Department stores. Mr. Evans holds a BA in Finance from Ithaca College. Currently, he serves on the advisory board of Wholescale software development and on the board of directors of DXM, a privately held technology company with end-to-end solutions for apparel and footwear brands. |
|
|
Rachael A. Jarosh most recently served as President and Chief Executive Officer of Enactus, a global experiential learning platform for emerging social entrepreneurs building pre-seed to early stage businesses. She served in this role from 2016 to 2021. Prior, Ms. Jarosh served as President of the foundation and led global communications for Pentair plc; and held various roles at RBC Dain Rauscher, Supervalu, Inc. (now UNFI), and Carmichael Lynch Spong. She began her career as an attorney in 1993. She serves as Chair of the board for the United Nations High Commission for Refugees. | |
|
Cherrie Nanninga has been a partner of Real Estate Solutions Group, LLC, a privately-held real estate consulting firm, since May 2014 and prior to that was the Chief Operating Officer of the New York Tri-State Region of CBRE, a commercial real estate firm, since 2002. For 23 years prior thereto, Ms. Nanninga was employed by The Port Authority of New York and New Jersey where she most recently served as Deputy Chief Financial Officer and Director of Real Estate. |
||
|
|
Craig Phillips held the position of Senior Vice-President — Distribution from July 2003 to January 2015 when he retired from the Company. Previously, Mr. Phillips held the position of Vice-President — Manufacturing from 1974 to 2003. Mr. Phillips, a cousin of Mr. Jeffrey Siegel, who serves as Chairman of our Board, has been a director of the Company since 1974. | |
| Veronique Gabai-Pinsky held the position of Global President of the Vera Wang Group, a fashion designer, manufacturer, and distributor, from 2015 to 2018. Previously, Ms. Gabai-Pinsky held the position of Global President of ADF (all fragrance portfolio), Lab Series (skin care for men) Beauty Bank and Idea Bank (New Brands Development), all divisions of the Estée Lauder Companies from 2006 to 2015 and served as the General Manager for Donna Karan and Michael Kors in the same ADF division from 2003 to 2006. Prior to her service at the Estée Lauder Companies, Ms. Gabai-Pinsky held various executive level marketing and management positions at large international beauty companies such as Dragoco (now Symrise), LVMH and L’OREAL from 1988 to 2003. Ms. Gabai-Pinsky currently serves on the board of directors of Inter Parfums, Inc. (Nasdaq: IPAR), a publicly-traded company, since 2017 and Parfums de Marly, a private company, since 2023. Ms. Gabai-Pinsky leads her own eponymous brand of luxury perfumes, which she founded in late 2019.
|
14
Table of Contents
|
|
Bruce G. Pollack is a Managing Partner of Centre Partners Management LLC, where he has been employed since 1991. Mr. Pollack began his career in the investment banking division of Becker Paribas Incorporated and Merrill Lynch Capital Markets. Mr. Pollack currently serves on the board of directors of Taylor Parent, LLC, Sabrosura Foods, LLC, Seafood Kitchen Holding, LLC, Nearly Natural, LLC, Golding Farms Foods, Inc., Midwest Mobility Solutions, Inc. and One World Fitness PFF, LLC, each a private portfolio company of Centre Partners Management LLC. Mr. Pollack previously served on the board of directors of a number of companies including Taylor Precision Products, Inc. (until March 2018), Bellisio Foods, Inc., Bumble Bee Foods, L.P., KIK Corporation Holdings, Inc., Salton, Inc. and a number of other private companies. Mr. Pollack received a B.A. from Brandeis University.
|
|
Michael J. Regan is a retired certified public accountant. From 1996 to 2002, Mr. Regan was the Vice Chairman and Chief Administrative Officer of KPMG LLP, a leading independent public accounting firm, and he was the lead audit partner for many Fortune 500 companies during his 40-year tenure with KPMG (1962 to 2002). The Board has determined that Mr. Regan is an “Audit Committee Financial Expert,” as defined by SEC rules. |
|
|
|
Michael Schnabel is a Senior Partner of Centre Partners Management LLC. Mr. Schnabel joined Centre Partners Management LLC in 2002. Prior to joining Centre Partners Management LLC, he served as Director of Finance at OmniSky Corporation after having worked in Donaldson, Lufkin & Jenrette Securities Corp.’s investment banking department. Mr. Schnabel currently serves on the board of directors of Taylor Parent, LLC, Covenant Care, LLC, Nearly Natural, LLC, Sun Orchard, Inc., Sabrosura Foods, LLC, KNS International, LLC and Guy & O’Neill, Inc., each of which is either a private portfolio company of Centre Partners Management LLC or a subsidiary of the Company. He previously served on the board of directors of ActionEmco Acquisition, LLC, Bellisio Foods, Inc., Bradford Health Services, LLC, Captain D’s, LLC, CDSI Holding Company, Inc., Group Dekko Holdings, Inc., Stonewall Kitchen LLC and Uno Restaurant Holdings Corp. Mr. Schnabel received a B.S. from Duke University. |
15
Table of Contents
Key Qualifications of Director Nominees
The following chart sets forth the specific experience, qualifications, attributes or skills that led to the Board’s determination that each director nominee is qualified to serve on the Board. Because it is a summary, it does not include all of the skills, experiences, and qualifications that each director offers, and the fact that a particular experience, skill, or qualification is not listed does not mean that a director does not possess it. All of our directors exhibit high integrity, an appreciation for a range of interdisciplinary backgrounds and thought, innovative thinking, a proven record of success, and deep knowledge of corporate governance requirements and best practices.
| Nominee | Key Qualifications | |
| Jeffrey Siegel | Service as our Executive Chairman until his transition to Chairman of the Board in 2023; extensive knowledge of our strategy, operations and financial position and of the housewares and retail industries. | |
| Robert B. Kay | Service as our Chief Executive Officer; distinguished career as the Chief Executive Officer in the housewares industry; experience gained in leadership positions in various industries. | |
| Jeffrey H. Evans | Extensive experience in management positions across different retail formats; deep knowledge in ecommerce and merchandising over a wide-range of businesses; consistent track record of building brands with strength in sourcing and product development; skilled in talent and organizational management. | |
| Rachael A. Jarosh | Strong background in communications, finance and general management with deep knowledge of private sector ESG matters; strong legal experience as counsel in corporate practice in private practice and knowledge of investment banking with a background in investment research and banking at a large bank. | |
| Cherrie Nanninga | Extensive experience as a financial and operations executive; experience as Deputy Chief Financial Officer of a large public sector organization and Chief Operating Officer of a large division of a multinational company; knowledge of the Company and the housewares industry through board service. | |
| Craig Phillips | Longstanding service as our Senior Vice-President – Distribution and Vice-President – Manufacturing until his retirement in 2015; knowledge of our strategy, operations and financial position and of the housewares industry. | |
| Veronique Gabai-Pinsky | Expert in brand building, product development, creative and innovation, global business management, organizational design, talent management, brand portfolio management through senior leadership positions in the beauty and fragrance industry and the ready-to-wear apparel industry. | |
| Bruce G. Pollack | Extensive investment banking and private equity experience; board of director leadership experience through portfolio companies of Centre Partners Management LLC. | |
| Michael J. Regan | Notable career with extensive public company board experience; experience as an audit partner in a large international accounting firm; financial, business and strategic acumen and knowledge of the retail and consumer products industries. | |
| Michael Schnabel | Extensive investment banking and private equity experience; board of director leadership experience through portfolio companies of Centre Partners Management LLC.
| |
Each of the nominees has consented to being named in this Proxy Statement and to serve on the Board if elected. We have no reason to believe that any of the nominees will not be a candidate or will be unable to serve. However, should any of the foregoing nominees become unavailable for any reason, the persons named as proxies in the enclosed proxy card intend to vote for such other person or persons as the Board may nominate.
16
Table of Contents
Our director nominees are highly qualified and, as a group, embody an effective and robust mix of skills and experience, as shown in the matrix below.
Skills Matrix
|
|
J. Evans |
R. Jarosh |
R. Kay |
C. Nanninga |
C. Phillips |
V. Gabai- Pinsky |
B. Pollack |
M. Regan |
M. Schnabel |
J. Siegel |
||||||||||||||||||||||||||||||
| Knowledge, Skills and Experience | ||||||||||||||||||||||||||||||||||||||||
| Public Company Board Experience | X | X | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||
| Financial Literacy | X | X | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||
| Risk Management | X | X | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||
| Accounting | X | X | X | X | ||||||||||||||||||||||||||||||||||||
| Corporate Governance | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||||
| Legal/Regulatory | X | |||||||||||||||||||||||||||||||||||||||
| Human Capital/Compensation | X | X | X | X | X | X | X | X | X | X | ||||||||||||||||||||||||||||||
| Executive Experience | X | X | X | X | X | X | X | X | X | X | ||||||||||||||||||||||||||||||
| Strategic Planning/Oversight | X | X | X | X | X | X | X | X | X | X | ||||||||||||||||||||||||||||||
| Mergers and Acquisition | X | X | X | X | X | X | ||||||||||||||||||||||||||||||||||
| Housewares/Retail Industry | X | X | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||
| Environmental, Social and Governance | X | X | X | X | X | X | X | X | ||||||||||||||||||||||||||||||||
Our Board unanimously recommends that stockholders vote FOR
the election of each of the nominated directors.
17
Table of Contents
EXECUTIVE OFFICERS
The following table sets forth the names and ages of each of our executive officers as of April 25, 2025.
| Name | Age | Positions/Offices with Company | ||
| Robert B. Kay | 63 | Director and Chief Executive Officer | ||
| Daniel Siegel | 55 | President | ||
| Laurence Winoker | 69 | Executive Vice President, Treasurer and Chief Financial Officer | ||
EXECUTIVE OFFICER BACKGROUNDS
See Election of Directors for the biography of Mr. Kay.
All of our officers are elected annually by our Board, hold office at the pleasure of the Board and serve until their successors are duly elected and qualified. Certain officers are executives of the Company for a contractual term pursuant to employment agreements. See the Compensation Discussion and Analysis section for summarized terms of these agreements.
Daniel Siegel has served in various positions since joining us in 1992, including as President since 2013. Prior thereto, Mr. D. Siegel was Executive Vice President of Sales from 2006 to 2008, Executive Vice President of Corporate Invention Strategies from 2008 to 2010 and was an Executive Vice President from 2010 to 2013. Mr. D. Siegel is the son of Jeffrey Siegel, Chairman of our Board.
Laurence Winoker is the Company’s Executive Vice President, Treasurer and Chief Financial Officer. Previously, Mr. Winoker held the position of Senior Vice President, Finance, Treasurer and Chief Financial Officer since July 2007. Prior thereto, Mr. Winoker was Senior Vice President, Controller and Treasurer of MacAndrews & Forbes Holdings Inc., a holding company with controlling interests in a diversified portfolio of public and private companies including Revlon, Inc. Mr. Winoker was Senior Vice President, Treasurer and Controller of Revlon, Inc. from 1999 to 2003.
18
Table of Contents
● |
Chairing meetings of our Board at which the Chairman of our Board is not present; |
● |
Reviewing the agenda approved by the Chairman of our Board for Board meetings and, with input from the other independent directors, suggesting to the Chairman of our Board additional agenda items for Board meetings, as well as the substance and timeliness of information to be sent to the members of our Board in connection with Board meetings and in between Board meetings; |
● |
Reviewing with the Chairman of our Board the schedule for meetings of our Board to help assure that there is sufficient time allocated for discussion of all agenda items; |
● |
Maintaining constant communication with the Chairman of our Board between meetings of our Board; |
● |
Collaborating with and acting as a resource for, and counsel to, the Chairman of our Board; |
● |
Chairing meetings of the independent directors; |
● |
Reviewing with the Chairman of our Board the schedule for meetings of the independent directors and, with input from the other independent directors, setting the agenda for such meetings; |
● |
Reviewing with the Chairman of our Board, after meetings of the independent directors, matters discussed by the independent directors at such meetings; |
● |
Facilitating communication and serving as the principal liaison on Board-related issues between the Chairman of our Board and the independent directors. Notwithstanding the foregoing, each director is free to communicate directly with the Chairman of our Board, other directors and senior management; |
● |
Authorizing the retention of independent legal advisors, and other independent consultants and advisors, as necessary, to advise the independent directors on issues related to the independent directors. Such advisors and consultants shall work with, and under the direction of, the lead independent director and report directly to the independent directors with respect to such issues; and |
● |
At least annually, reviewing with the other independent directors and with the Chairman of our Board the duties and responsibilities of the lead independent director. |
Table of Contents
STOCKHOLDER COMMUNICATION WITH DIRECTORS
Stockholders and other interested parties who wish to communicate with members of our Board, including the independent directors, individually or as a group, may send correspondence to them care of the Corporate Secretary at our principal office, 1000 Stewart Avenue, Garden City, New York 11530. Alternatively, the directors may be contacted via e-mail at BoardofDirectors@lifetimebrands.com. All such communications will be relayed to the members of our Board generally or individually, as specified.
BOARD NOMINATION PROCESS
Our Board nominates candidates to serve as directors based on recommendations of the Board’s Nominating and Governance Committee.
Our Nominating and Governance Committee’s procedures for identifying and evaluating candidates include requests for candidate recommendations from within the housewares industry and from outside independent professional advisors, as the case may be. In selecting a director nominee, our Nominating and Governance Committee focuses on skills, expertise and backgrounds that would complement those of the existing members of our Board, recognizing the nature of our business.
NOMINATING AND GOVERNANCE COMMITTEE
Our Nominating and Governance Committee is currently composed of four of our independent directors: Michael J. Regan (Chair), Rachael A. Jarosh, Cherrie Nanninga, and Bruce G. Pollack. The Nominating and Governance Committee held four meetings in 2024.
Our Nominating and Governance Committee has the following responsibilities:
| ● | To evaluate the qualifications of candidates for Board membership and, following consultation with the Chief Executive Officer and Chairman, recommend to our Board nominees for open or newly created director positions; |
| ● | To consider nominees recommended by stockholders as long as such recommendations are received at least 120 calendar days prior to the one-year anniversary date of the immediately preceding year’s annual meeting of stockholders; |
| ● | To periodically review the composition of our Board to determine whether it may be appropriate to add or subtract individuals with different backgrounds or skill sets from those already on our Board, and submit to our Board on an annual basis a report summarizing its conclusions regarding these matters; |
| ● | To develop and make recommendations to our Board regarding governance principles applicable to us; |
| ● | To periodically assess the structure and operations of the committees of our Board; |
| ● | To develop and recommend to the Board corporate governance guidelines and to review such guidelines periodically; |
| ● | To develop and recommend procedures for the evaluation and self-evaluation of our Board and its committees and to oversee the evaluation process; |
| ● | To perform an evaluation of the committee’s performance periodically; and |
| ● | To perform such other duties as our Board may assign to the committee. |
Our Nominating and Governance Committee charter is available on our website, www.lifetimebrands.com, in the Corporate Governance subsection under Investor Relations.
PROCESS FOR STOCKHOLDERS TO RECOMMEND DIRECTOR NOMINEES
Our Board, through our Nominating and Governance Committee, will consider nominees recommended by stockholders as long as, consistent with our Nominating and Governance Committee charter, such recommendations are timely received in accordance with the Company’s By-Laws, as may be amended from time to time. A stockholder wishing to recommend a candidate must submit the following documents to the Corporate Secretary, Lifetime Brands, Inc., 1000 Stewart Avenue, Garden City, New York 11530, not less than 120 calendar days prior to the one-year anniversary date of the immediately preceding year’s annual meeting of stockholders:
| ● | A recommendation that identifies the candidate and provides contact information for that candidate; |
| ● | The written consent of the candidate to serve as a director of the Company, if elected; and |
| ● | If the candidate is to be evaluated by the Nominating and Governance Committee, the Corporate Secretary will request from the candidate a detailed resume, an autobiographical statement explaining the candidate’s interest in serving as a director of the Company, a completed statement regarding conflicts of interest, and a waiver of liability for a background check. |
22
Table of Contents
The Nominating and Governance Committee evaluates all candidates based on the same criteria, regardless of who recommended the candidate.
AUDIT COMMITTEE
Our Audit Committee is currently composed of three directors, each of whom is independent, as required by the Audit Committee charter, the Exchange Act, the Nasdaq listing rules and the SEC rules. The current members are Michael J. Regan (Chair), Michael Schnabel and Craig Phillips. Our Board has determined that Michael J. Regan is an “Audit Committee Financial Expert,” as defined by the SEC rules. The Audit Committee held four meetings during 2024.
Our Audit Committee, among other things:
| ● | Considers the qualifications of and appoints and oversees the activities of our independent registered public accounting firm, i.e., our independent auditor; |
| ● | Reviews with the independent auditor any audit problems or difficulties encountered in the course of audit work; |
| ● | Preapproves all audit and non-audit services provided by the independent auditor; |
| ● | Discusses with the internal auditors and the independent auditor the overall scope and plans for their respective audits, including the adequacy of staffing and budget or compensation; |
| ● | Reviews our financial statements and reports and meets with management and the independent auditor to review, discuss and approve our financial statements, ensuring the completeness and clarity of the disclosures in the financial statements; |
| ● | Monitors compliance with our internal controls, policies, procedures and practices; |
| ● | Reviews management’s report on its assessment of the effectiveness of internal control over financial reporting as of the end of each fiscal year and the independent auditor’s report on the effectiveness of internal control over financial reporting; |
| ● | Reviews the performance of our internal audit function and approves our Internal Audit Department’s annual audit plan and all major changes to the plan; |
| ● | Discusses our policies on risk assessment and risk management, our major financial risk exposures and the steps management has taken to monitor and control such exposures; |
| ● | Reviews our compliance and ethics programs, including legal and regulatory requirements, and reviews with management our periodic evaluation of the effectiveness of such programs; |
| ● | Reviews and approves related-party transactions; and |
| ● | Undertakes such other activities as our Board from time to time may delegate to it. |
Our Audit Committee charter is available on our website, www.lifetimebrands.com, in the Corporate Governance subsection under Investor Relations.
COMPENSATION COMMITTEE
Our Compensation Committee is composed of three directors, each of whom is independent. The current members are Cherrie Nanninga (Chair), Rachael A. Jarosh, and Bruce G. Pollack. Our Compensation Committee held six meetings in 2024.
Our Compensation Committee advises our Board with respect to our compensation practices and administers our Amended and Restated 2000 Incentive Bonus Compensation Plan and our Amended and Restated 2000 Long-Term Incentive Plan.
The principal duties and responsibilities of our Compensation Committee include:
| ● | Reviewing and approving compensation principles that apply generally to our executive officers; |
| ● | Establishing and reviewing corporate goals and objectives relevant to the compensation of the Chief Executive Officer and evaluating his performance in light of the established goals and objectives and approving his annual compensation; |
| ● | Reviewing, based primarily on the evaluations and recommendations of the Chief Executive Officer, the performance of the other executive officers and in light of established goals and objectives, approving their annual compensation; |
| ● | Reviewing the compensation of the Board and recommending changes, as appropriate, to the Board; |
| ● | Overseeing our compliance with the requirements under the Nasdaq Stock Market Rules, with respect to our long-term incentive compensation plans; |
| ● | Overseeing and monitoring compliance with the Company’s policies with respect to the recovery or “clawback” of compensation; and |
| ● | Reviewing and discussing compensation programs that may create incentives that can affect our risk and management of that risk. |
23
Table of Contents
The Compensation Committee may delegate any of its responsibilities to one or more subcommittees, each of which shall be composed of two or more members, as the Compensation Committee may deem appropriate.
Our Compensation Committee charter is available on our website, www.lifetimebrands.com, in the Corporate Governance subsection under Investor Relations.
ESG COMMITTEE
Our ESG Committee is currently composed of four directors: Veronique Gabai-Pinsky (Chair), Rachael A. Jarosh, Jeffrey Siegel and Robert B. Kay. Our ESG Committee was formed in November 2021 for the purpose of providing guidance and oversight for the Company’s environmental, social and governance initiatives. The ESG Committee held two meetings during 2024.
Our ESG Committee has the following responsibilities:
| ● | To review and monitor the Company’s sustainability and corporate responsibility practices, including ESG reporting and disclosure practices; |
| ● | To oversee strategies relevant to the Company’s ESG practices in a manner aligned with the Company’s overall business strategy; |
| ● | To consider and/or define, as appropriate, ESG-related goals; |
| ● | To oversee the Company’s support of charitable, educational, and non-profit business organizations; |
| ● | To monitor external developments and oversee management’s plans for mitigating developments that are likely to have a significant influence on the Company’s reputation or its ability to conduct its business responsibly; |
| ● | To oversee and monitor the Company’s strategies relating to human capital management; and |
| ● | To perform such other duties as the Board may assign to the Committee. |
Our ESG Committee charter is available on our website, www.lifetimebrands.com, in the Corporate Governance subsection under Investor Relations.
EXECUTIVE COMMITTEE
Our Executive Committee is composed of three directors. The current members are Jeffrey Siegel (Chair), Michael J. Regan and Robert B. Kay. Our Executive Committee held no meetings in 2024.
Our Executive Committee was formed in 2016, at the recommendation of the Nominating and Governance Committee, for authorizing the opening and closing of bank accounts for the Company and other matters delegated by the Board of Directors to the Executive Committee.
EXECUTIVE SESSIONS
The independent directors meet at regularly scheduled executive sessions without members of management present.
24
Table of Contents
DIRECTOR COMPENSATION
Fees paid to our non-employee directors are based on the following schedule.
| Board of Directors Annual Retainer |
|
|
| |
| Cash |
$ | 60,000 | ||
| Restricted Common Stock |
$ | 105,000 | ||
| Total |
$ | 165,000 | ||
| Committee Chair Annual Cash Retainer |
||||
| Chair of Audit or Compensation Committee |
$ | 20,000 | ||
| Chair of Nominating/Governance or ESG Committee |
$ | 10,000 | ||
| Committee Member Annual Cash Retainer |
$ | 2,000 | ||
| Lead Independent Director Annual Cash Retainer |
$ | 30,000 | ||
| Chairman Annual Cash Retainer |
$ | 50,000 | ||
| Cash Fee for Each Meeting Attended |
||||
| Board Meeting |
$ | 2,000 | ||
| Committee Meeting |
$ | 500 | ||
The following table sets forth compensation paid to our non-employee directors for 2024.
| Name | Fees earned or paid in cash |
Stock awards (1) (2) | All Other Compensation |
Total | ||||||||||||
| Jeffrey Siegel |
$ | 125,000 | $ | 105,000 | $ | — | $ | 230,000 | ||||||||
| Rachael A. Jarosh |
84,000 | 105,000 | — | 189,000 | ||||||||||||
| Cherrie Nanninga |
99,000 | 105,000 | — | 204,000 | ||||||||||||
| Craig Phillips |
76,000 | 105,000 | — | 181,000 | ||||||||||||
| Veronique Gabai-Pinsky |
83,000 | 105,000 | — | 188,000 | ||||||||||||
| Bruce G. Pollack |
81,000 | 105,000 | — | 186,000 | ||||||||||||
| Michael J. Regan |
136,000 | 105,000 | — | 241,000 | ||||||||||||
| Michael Schnabel |
76,000 | 105,000 | — | 181,000 | ||||||||||||
Note:
| (1) | Represents the aggregate grant date fair value of the awards as determined under Financial Accounting Standards Board Accounting Standards Codification Topic No. 718-20, Awards Classified as Equity, recognized by the Company for awards granted during 2024. For information, including assumptions, regarding the valuation of these awards refer to Note 9 to the Company’s Consolidated Financial Statements for the year ended December 31, 2024 included in the 2024 Annual Report, and the Company’s discussion of Significant Accounting Policies under the heading “Share-based compensation” included on page F-12 of the 2024 Annual Report. |
| (2) | Consists of restricted stock awards valued at the closing market price of the Company’s common stock on the date of grant. |
25
Table of Contents
The following table sets forth the aggregate number of restricted shares of our common stock and shares of our common stock issuable upon the exercise of stock options held by each non-employee director at December 31, 2024.
| Name |
Restricted shares | Vested stock options | Unvested stock options | |||||||||
| Jeffrey Siegel (1) |
11,653 | 75,000 | — | |||||||||
| Rachael A. Jarosh (1) |
11,653 | — | — | |||||||||
| Cherrie Nanninga (1) |
11,653 | — | — | |||||||||
| Craig Phillips (1) |
11,653 | — | — | |||||||||
| Veronique Gabai-Pinsky (1) |
11,653 | — | — | |||||||||
| Bruce G. Pollack (1) |
11,653 | — | — | |||||||||
| Michael J. Regan (1) |
11,653 | — | — | |||||||||
| Michael Schnabel (1) |
11,653 | — | — | |||||||||
Note:
| (1) | 11,653 restricted shares were granted to each of our directors on June 20, 2024 and fully vest on June 20, 2025. |
26
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
EXECUTIVE SUMMARY
About Our Business
Lifetime Brands is a leading global provider of kitchenware, tableware and other products used in the home. We offer brands you trust, value without compromise and an unwavering commitment to innovation. Our products make it easier for you to prepare food, serve meals, entertain guests, and decorate your home.
We market products under well-known kitchenware brands, including Farberware, KitchenAid, Sabatier, Amco Houseworks, Chef’n, Chicago Metallic, Copco, Fred & Friends, Houdini, KitchenCraft, Kamenstein, MasterClass, Misto, Swing-A-Way, Taylor Kitchen, Rabbit and Dolly; respected tableware and giftware brands, including Mikasa, Pfaltzgraff, Fitz and Floyd, Empire Silver, Gorham, International Silver, Towle Silversmiths, Wallace, Wilton Armetale, V&A, Royal Botanic Gardens Kew, Year & Day, Dolly, Royal Leerdam, and ONIS; and valued home solutions brands, including BUILT NY, S’well, Taylor Bath, Taylor Weather, Planet Box, and Dolly. We also provide exclusive private label products to leading retailers worldwide.
Our products can be found in mass market merchants, specialty stores, department stores, warehouse clubs, grocery stores, off-price retailers, food service distributors, food and beverage outlets, corporate sales and e-commerce retailers, as well as our branded websites.
Our Executives
Our named executive officers (“NEOs”) for 2024 are:
| ● | Robert B. Kay, Chief Executive Officer and Director |
| ● | Daniel Siegel, President |
| ● | Laurence Winoker, Executive Vice President, Treasurer and Chief Financial Officer |
2024 Performance
The Company’s financial results for 2024 included the following:
| • | Net sales were $683.0 million in 2024, as compared to net sales of $686.7 million in 2023. |
| • | Adjusted income from operations(1) was $44.7 million in 2024, as compared to $48.9 million in 2023. |
| • | Net loss was $(15.2) million in 2024, as compared to a net loss of $(8.4) million in 2023. |
| • | Adjusted net income(1) was $12.6 million in 2024, as compared to $11.0 million in 2023. |
| • | Adjusted EBITDA(1) was $55.4 million in 2024, as compared to $57.3 million in 2023. |
(1) These amounts represent non-GAAP financial measures. A reconciliation of these measures to the most directly comparable GAAP measure is included in Appendix A.
Say-On-Pay
In 2024, our Board provided stockholders with the opportunity to cast an advisory vote on executive compensation. At our most recent Annual Meeting of Stockholders held on June 20, 2024, approximately 90% of the votes cast approved, on an advisory basis, the compensation of our NEOs. Although these votes were non-binding and advisory, our Compensation Committee believes that the outcome affirms stockholder support of our approach to executive compensation. Based on the 2024 Say-on-Pay vote results, the Compensation Committee determined that no specific changes would be made to the executive compensation program, however, the Compensation Committee will continue to evaluate the Company’s executive compensation programs, taking into account stockholder feedback.
COMPENSATION PHILOSOPHY AND OBJECTIVES
Our compensation philosophy has historically been to attract, reward and retain capable executives and to provide incentives for the attainment of short-term performance objectives and strategic long-term performance goals. A number
27
Table of Contents
of key objectives guide management and our Compensation Committee in determining compensation for hiring, motivating, rewarding and retaining executive officers who create both short-term and long-term stockholder value, including:
| ● | A significant amount of compensation should be linked to measurable success in business performance; |
| ● | Management’s interests should be aligned with those of the stockholders; |
| ● | Both short-term and long-term financial and business objectives should be incentivizing; and |
| ● | Compensation should be set at levels that will be competitive with the compensation offered by those companies against whom we compete for executive talent so that we are able to attract and retain experienced executives. |
In an effort to balance the need to retain talent and motivate executives to achieve superior performance, we have adopted a compensation program that contains both fixed and variable elements of compensation. Our goal is to reward executives with compensation measures and performance targets that are aligned with our short-term and long-term financial goals yet do not promote excessive risk-taking.
The elements of our total executive compensation program include base salary, annual cash bonus, and stock incentives that consist of restricted stock and performance-based deferred stock, which we refer to as performance shares. Our Compensation Committee uses its judgment in allocating compensation between long-term and short-term incentives and cash and non-cash components. Although long-term incentives are considered to be of great significance in aligning performance with stockholder interests, they have traditionally been a smaller component of aggregate compensation.
Based on 2024 target compensation, long-term incentives for our Chief Executive Officer comprised 46% of his total compensation for 2024, with 23% attributable to restricted stock and 23% attributable to performance shares, while total “at-risk” compensation comprised approximately 74% of his total compensation, with 28% attributable to annual bonus in addition to the 46% attributable to equity-based compensation. Long-term incentives for all other NEOs comprised 22% of their total compensation for 2024, with 11% attributable to restricted stock and 11% attributable to performance shares, while total “at risk” compensation comprised of 60% of their total compensation for 2024, with 38% attributable to annual bonus in addition to the 22% attributable to equity-based compensation. We used Adjusted EBITDA, which is a non-GAAP measure, as a performance metric for both our annual cash bonus program and long-term equity grants because it is an objective and quantifiable measurement of our financial performance, and reflects how we externally report our financial results. For more information on our use of Adjusted EBITDA in our executive compensation program, please see below under “Elements of Compensation – Annual Bonuses and “ - Equity Compensation.” Additionally, refer to Appendix A for a reconciliation of the Company’s net loss (the most directly comparable GAAP measure) to Adjusted EBITDA.
ROLE OF COMPENSATION COMMITTEE
Our Compensation Committee has the authority to review and approve compensation principles and practices that apply generally to our executives and senior employees. Our Compensation Committee reviews corporate goals and objectives relevant to the compensation of our Chief Executive Officer, evaluates his performance in light of the established goals and objectives and approves his annual compensation. Our Compensation Committee also reviews the corporate goals and objectives established by our Chief Executive Officer relevant to the compensation of all other executive officers and all direct reports of the Chief Executive Officer. Based primarily on the evaluations and recommendations of our Chief Executive Officer of the performance of such executive officers and direct reports in light of the established goals and objectives, our Compensation Committee approves the annual compensation of such executive officers and direct reports. It also reviews the evaluation process and compensation structure for the other members of our senior management and provides oversight regarding management’s decisions concerning the performance and compensation of such members of senior management. Our Compensation Committee takes into account and considers reports of its independent compensation consultant, Pearl Meyer & Partners, LLC (“Pearl Meyer”), as to the elements of compensation among our peer group of companies (discussed under Role of Compensation Consultant) and the proportion of each component relative to the total compensation.
ROLE OF COMPENSATION CONSULTANT
Our Compensation Committee has engaged Pearl Meyer as its independent outside compensation consultant to provide services related to executive and non-employee director compensation. Pearl Meyer does not provide other services unless approved by our Compensation Committee. In 2024, Pearl Meyer provided competitive data and a market analysis, which was used by our Compensation Committee in evaluating the compensation of our Chief Executive Officer, as well as non-employee director compensation. Pearl Meyer assists our Compensation Committee in its evaluation of our compensation philosophy and with the development of relevant metrics used by our Compensation Committee to assure internal pay equity and market parity. It also provides compensation data and information relative to our peer group.
28
Table of Contents
As required under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, our Compensation Committee analyzed whether the services of Pearl Meyer could result in any conflicts of interest, giving consideration to the following factors:
| ● | Pearl Meyer does not provide any services to us other than as approved by our Compensation Committee; |
| ● | The fees we paid amount to less than 1% of Pearl Meyer’s total revenue for the applicable period; |
| ● | The policies and procedures of our Compensation Committee were designed to ensure independence; |
| ● | Pearl Meyer does not have any business or personal relationship with any of our executive officers or any member of our Compensation Committee; and |
| ● | Neither Pearl Meyer nor any of its consultants who provide services to our Compensation Committee own any of our stock. |
Our Compensation Committee has determined that the services of Pearl Meyer, including the individual compensation advisors employed by it, have not created any conflicts of interest. On an annual basis, our Compensation Committee will continue to monitor the independence of its compensation consultant.
PEER GROUP DEVELOPMENT
Pearl Meyer developed a peer group of companies of comparable industry, size, and business operations for review and approval by our Compensation Committee. The peer companies were selected to represent companies in the household durables, leisure products, and textiles, apparel, and luxury goods industries that are within an appropriate size range to Lifetime Brands. Selected peers typically fall within revenue and market capitalization ranges of 0.5x – 2.5x and 0.25x – 4x Lifetime Brands, respectively. The peer group used to inform compensation decisions in fiscal 2024 was based on a peer group analysis completed by Pearl Meyer in 2023 and approved by the Compensation Committee. The group is composed of the following companies:
| ● | Delta Apparel |
| ● | Hamilton Beach Brands Holding Co. |
| ● | Helen of Troy Limited |
| ● | iRobot Corporation |
| ● | JAKKS Pacific |
| ● | Johnson Outdoors Inc. |
| ● | Lands’ End, Inc. |
| ● | Movado Group, Inc. |
| ● | Oxford Industries, Inc. |
| ● | Solo Brands |
| ● | Superior Group of Companies |
| ● | The Buckle, Inc. |
| ● | Unifi, Inc. |
| ● | Universal Electronics Inc. |
| ● | Vera Bradley, Inc. |
| ● | YETI Holdings, Inc. |
Our Compensation Committee believes that the companies included in the peer group are the most comparable public companies; however, most of our direct competitors are either smaller, international or privately-held. Our Compensation Committee considers the competitive data compiled by Pearl Meyer as reference points, but does not “benchmark” to specific pay levels when establishing goals and objectives relevant to our compensation policy.
29
Table of Contents
ELEMENTS OF COMPENSATION
Base Salary
Salary is intended to compensate our executives for performance of core job responsibilities and duties. The amount and components of aggregate compensation for comparable positions in our peer group of companies were taken into account by our Compensation Committee in determining the base salaries of our NEOs. The base salary for each NEO for 2024 and 2023 was as follows:
| Executive
|
2024 Base Salary
|
2023 Base Salary
|
% Increase
| ||||||||||||
| Robert Kay
Chief Executive Officer |
$1,000,000 | $1,000,000 | 0% | ||||||||||||
| Daniel Siegel
President |
$725,000 | $725,000 | 0% | ||||||||||||
| Laurence Winoker
Executive Vice President, Treasurer and Chief Financial Officer |
$460,000 | $446,250 | 3% | ||||||||||||
We maintain employment agreements with each of our current NEOs, which agreements set forth the amount of base salary payable to Messrs. Kay, D. Siegel, and Winoker, which may be increased by the Company from time to time. Any base salary increases for Messrs. D. Siegel and Winoker are determined by the Chief Executive Officer, in consultation with our Compensation Committee, taking into consideration each executive’s roles and responsibilities within the Company, as well as the amount and components of aggregate compensation for comparable positions in our peer group of companies. Effective January 1, 2024, Mr. Winoker’s annual base salary was increased from $446,250 to $460,000 in order to more closely align Mr. Winoker’s base salary with market practice.
Annual Bonuses
Annual bonuses are intended to compensate NEOs for achievement of specific short-term performance goals for a specified performance period and are based on achievement of both a Company performance metric and individual performance goals. Bonuses are awarded pursuant to the Company’s Amended and Restated 2000 Incentive Bonus Compensation Plan and each NEO’s employment agreement. For 2024, our Compensation Committee determined that the Company performance metric applicable to annual bonuses would be based on Adjusted EBITDA (as defined below). Messrs. Kay, D. Siegel and Winoker were each eligible to receive annual bonuses for 2024.
For each NEO eligible to receive an annual bonus for 2024, the weighting for both of the Adjusted EBITDA and Individual Goal components are shown in the table below.
|
Executive |
Adjusted EBITDA Weighting as a % of Target |
Individual Goals Weighting as a % of Target | ||
|
Robert Kay
|
78.0%
|
22.0%
| ||
|
Daniel Siegel
|
67.0%
|
33.0%
| ||
|
Laurence Winoker
|
67.0%
|
33.0%
|
Our Compensation Committee has determined that Adjusted EBITDA is an appropriate measure because the Company uses this financial measure in evaluating the Company’s ongoing financial results and trends. In addition, management uses this non-GAAP information as an indicator of business performance. It is also one of the measures used to calculate financial covenants required to be provided to the Company’s lenders pursuant to its debt agreements. In determining the use of Adjusted EBITDA as the Company performance metric, our Compensation Committee was also guided by the extent to which this metric is within the control of the respective NEO.
For the purpose of establishing the portion of the annual bonus that is based on Adjusted EBITDA for the NEOs, our Compensation Committee considered data provided by Pearl Meyer.
Each NEO’s employment agreement provides for a target annual bonus based on Adjusted EBITDA (“Adjusted EBITDA Target Bonus”) and a target annual bonus based on individual goal achievement (“Individual Goal Target Bonus”).
30
Table of Contents
The portion of the Adjusted EBITDA Target Bonus payable to each NEO for each year (the “Annual Adjusted EBITDA Performance Bonus”), if any, is based on an Annual Adjusted EBITDA Performance Table prepared by our Compensation Committee and the annual budget reviewed and approved by the Board and in accordance with the NEO’s employment agreement. The percentage of each NEO’s Annual Adjusted EBITDA Performance Bonus in the event of threshold, target, and maximum performance goal achievement is as follows:
|
Executive |
Threshold Payout (% of Adjusted |
Target Payout (% of Adjusted |
Maximum Payout (% of Adjusted | |||
|
Robert Kay
|
50%
|
100%
|
200%
| |||
|
Daniel Siegel
|
50%
|
100%
|
150%
| |||
|
Laurence Winoker
|
50%
|
100%
|
200%
|
Each NEO is entitled to receive sliding scale payout percentages if Adjusted EBITDA achieved by the Company is between Adjusted EBITDA Performance Bonus levels. The Adjusted EBITDA Performance Bonus for any year will be zero if the Adjusted EBITDA achieved by the Company for such year is less than the threshold Adjusted EBITDA goal for such year, and in no event will an Annual Adjusted EBITDA Performance Bonus be more than 200% of the Adjusted EBITDA Target Bonus, in the case of Messrs. Kay and Winoker, and 150% of the Adjusted EBITDA Target Bonus in the case of Mr. D. Siegel.
The portion of the Individual Goal Target Bonus payable to each NEO for each year (the “Annual Individual Goal Bonus”), if any, is determined (i) in the case of Mr. Kay, based on his satisfaction of individual performance objectives set by our Compensation Committee, and (ii) in the cases of Messrs. D. Siegel and Winoker, based on their satisfaction of individual performance objectives set by Mr. Kay in consultation with our Compensation Committee. If an NEO satisfies 100% of such objectives, he is entitled to an Annual Individual Goal Bonus equal to 100% of the Individual Goal Target Bonus in accordance with the NEO’s employment agreement. If an NEO satisfies less than 100% of such objectives but at least 50% of such objectives, he is entitled to an Annual Individual Goal Bonus equal to at least 50% of the Individual Goal Target Bonus, and if an NEO meets less than 50% of such objectives, he is not entitled to receive any Annual Individual Goal Bonus. The individual goals established for each of the NEOs for 2024 are discussed below. At the end of the 2024 fiscal year, Mr. Kay prepared written materials for our Compensation Committee with his assessment of whether his individual goals were achieved during the year. Messrs. D. Siegel and Winoker prepared written materials for Mr. Kay, for presentation to and consultation with our Compensation Committee, with their assessments of whether their respective individual goals were achieved during the year. Our Compensation Committee reviewed these materials and assessed independently the extent to which their individual goals were achieved.
As set forth in the table below, we achieved an Adjusted EBITDA of $55.4 million for the 2024 fiscal year, which exceeded the threshold performance level but was below the target performance level of $58.3 million. Adjusted EBITDA for 2024, which is a non-GAAP measure, is equal to the Company’s adjusted earnings before interest (including mark to market loss on interest rate derivatives), income taxes, depreciation and amortization, adjusted to exclude equity in losses, net of taxes, loss on equity securities, non-cash share based compensation expense, acquisition-related expenses, and warehouse redesign expenses, as determined by the Company and derived from the Company’s audited financial statements. A reconciliation of the Company’s net loss (the most directly comparable GAAP measure) to Adjusted EBITDA is included in Appendix A.
| 2024 Annual Bonus Metric and Achievement | ||||||||||||||||
| Financial Metric |
Threshold Performance Level |
Target Performance Level |
Maximum Performance Level |
Maximum (Kay) |
Actual Performance Achieved |
Payout % of (Kay) |
Payout % of (D. Siegel) |
Payout % of (Winoker) | ||||||||
|
Adjusted EBITDA |
$48,972,000 |
$58,300,000 |
$67,628,000 |
$76,956,000 |
$55,371,000 |
88% |
83% |
83% | ||||||||
Mr. Kay’s individual goals for 2024 included: improving profitability in international operations and expanding distribution channels in international markets; achievement of growth for the Mikasa hospitality business; development of a supply chain diversification plan; identification of transformational mergers and acquisitions opportunities for the Board’s review; implementing a U.S. warehouse system redesign to support current and future U.S. distribution capability; development of new product lines and presenting a succession plan for CEO, CFO and other key senior management roles to the Board. Our Compensation Committee evaluated Mr. Kay’s achievement of his individual goals and determined that 90% of the goals were met and that Mr. Kay would receive 90% of his Individual Goal Target Bonus.
31
Table of Contents
Mr. D. Siegel’s individual goals for 2024 included: launching new product brands; development of a strategic plan for the Company’s hydration products; and enhancing the Company’s sales strategy for certain key customers. Our Chief Executive Officer, in consultation with our Compensation Committee, evaluated Mr. D. Siegel’s achievement of his individual goals and determined that 100% of the goals were met, and that Mr. D. Siegel would receive 100% of his Individual Goal Target Bonus.
Mr. Winoker’s individual goals for 2024 included: establishing communications for debt refinancing of the Company’s term loan; ensuring the effective transition of key members from the Company’s external auditors; finalizing the accounting and tax treatment related to the Company’s equity security investment; and improving the Company’s financial planning and analysis function as well as the U.K. finance function. Our Chief Executive Officer, in consultation with our Compensation Committee, evaluated Mr. Winoker’s achievement of his individual goals and determined that 100% of the goals were met, and that Mr. Winoker would receive 100% of his Individual Goal Target Bonus.
Each NEO’s 2024 annual bonus is set forth in the table below.
| Executive |
Annual Adjusted EBITDA
|
Annual Individual Goal
|
Total 2024 Annual
|
% of Target
|
||||||||||||
|
Robert Kay |
|
$773,667 |
|
|
$225,000 |
|
|
$998,667 |
|
|
88.8% |
| ||||
|
Daniel Siegel |
|
$453,625 |
|
|
$271,875 |
|
|
$725,500 |
|
|
89.0% |
| ||||
|
Laurence Winoker |
|
$191,900 |
|
|
$115,000 |
|
|
$306,900 |
|
|
89.0% |
| ||||
Equity Compensation
Equity compensation is intended to incentivize and to promote alignment between our employees and our stockholders. Additionally, our performance shares reward NEOs if the Company achieves specified performance goals, and restricted stock incentivizes retention based on the period during which the restrictions lapse, which is typically four years.
Each NEO generally receives an annual equity grant in connection with annual performance reviews based on an assessment of such NEO’s individual performance and, where appropriate, the performance of such NEO’s business unit (division), as well as our overall performance and the dilutive effect of the equity awards. For Mr. Kay’s 2024 equity awards, our Compensation Committee structured the total award value toward the lower end of peers to better align with the market valuation at the time of grant.
Our annual equity compensation program generally consists of a mix of 50% time-based restricted stock awards and 50% performance shares. The time-based restricted stock vests 25% per year in four equal installments commencing on the first anniversary of the date of grant. The performance shares provide an opportunity for shares to be earned at the end of a three-year performance period if pre-established financial goals are met. These goals have been tailored to be challenging to achieve, so as to incentivize our NEOs to maximize their performance. Adjusted EBITDA was established as the performance metric for our performance shares granted in 2022, 2023 and 2024, each with a three-year performance period. The final number of shares earned pursuant to our performance shares granted in 2022 is dependent on the cumulative Adjusted EBITDA results over the 2022 through 2024 performance period with threshold, target and maximum awards equal to 75%, 100% and 150%, respectively, of the target number of performance shares awarded on the grant date. For purposes of the performance shares granted in 2022, “Adjusted EBITDA” is defined as our consolidated earnings before interest (including mark to market gain/loss on interest rate derivatives), income taxes, depreciation and amortization, adjusted to exclude equity in losses, net of tax, loss on equity securities, non-cash share based compensation expense, contingent consideration fair value adjustments, gain on extinguishments of debt, net, restructuring expenses, integration costs, acquisition-related expenses, warehouse redesign expenses, and Wallace facility remediation expense. Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure is included in Appendix A.
Our performance shares granted in 2022 for the three-year performance period that ended on December 31, 2024 resulted in the following percentage payouts:
| Performance Metrics | Weight | Threshold (in thousands) |
Target (in thousands) |
Maximum (in thousands) |
Actual (in thousands) |
% Target Earned |
||||||||||||||||||
|
Adjusted EBITDA |
|
100% |
|
$ |
242,760 |
|
$ |
289,000 |
|
$ |
335,240 |
|
$ |
170,882 |
|
|
59.1% |
| ||||||
32
Table of Contents
Actual performance shares earned for the 2022 performance cycle are shown in the table below for each executive. Because the performance metric for the three-year performance period fell below the defined threshold set by the Compensation Committee, no performance shares were earned.
|
Executive |
Performance Shares |
Performance Shares Earned |
Actual Performance |
|||||||||
|
Robert Kay
|
|
98,500
|
|
|
—%
|
|
|
0
|
| |||
|
Daniel Siegel
|
|
16,500
|
|
|
—%
|
|
|
0
|
| |||
|
Laurence Winoker
|
|
8,000
|
|
|
—%
|
|
|
0
|
| |||
Other Compensation
We maintain a defined contribution 401(k) plan for all employees, including the NEOs. We also offer perquisites that we believe are customary and reasonable, such as Company-paid automobile expenses, and with respect to Mr. Kay, reimbursement or payment of certain insurance and professional expenses.
ACCOUNTING AND TAX CONSIDERATIONS
Section 162(m) of the Internal Revenue Code (the “Code”) generally disallows a tax deduction to public companies for compensation in excess of $1 million paid to any of the company’s chief executive officer and certain other executive officers in any taxable year. Although our Compensation Committee considers tax consequences as a factor when it makes compensation decisions, it retains the discretion and flexibility to make compensation decisions resulting in the grant of non-deductible compensation to the extent it deems that it is appropriate.
POLICY REGARDING RESTATEMENTS
Our Board, upon the recommendation of the Compensation Committee, adopted a compensation recoupment policy (the “Clawback Policy”), which is effective for certain incentive-based compensation received by our current or former executive officers on or after October 2, 2023, and is consistent with the requirements of the SEC’s final compensation clawback rules under the Dodd-Frank Act and the Nasdaq listing standards. The Clawback Policy requires recoupment of such incentive-based compensation in the event the Company is required to restate its financial results due to the Company’s material non-compliance with any financial reporting requirement under the federal securities laws as required by the Dodd-Frank Act and corresponding Nasdaq listing standards. The recovery of such compensation applies regardless of whether an executive officer engaged in misconduct or otherwise caused or contributed to the requirement for a restatement.
COMPENSATION COMMITTEE REPORT
Our Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management. Based on this review and discussion, our Compensation Committee recommended to our Board that the Compensation Discussion and Analysis be included in our Proxy Statement.
This report is not soliciting material, is not deemed to be filed with the SEC, and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
The Compensation Committee
Cherrie Nanninga – Chair
Rachael A. Jarosh
Bruce G. Pollack
COMPENSATION RISK MANAGEMENT
The Company has reviewed its compensation policies and practices and concluded that any risks arising from the Company’s policies, plans and programs are not reasonably likely to have a material adverse effect on the Company.
33
Table of Contents
Accordingly, no material adjustments were made to the Company’s compensation policies and practices as a result of its risk profile. The Company reviewed the elements of compensation to determine whether any portion of the compensation programs encouraged excessive risk-taking and concluded:
| • | the allocation of compensation between cash compensation and equity compensation, combined with the vesting schedule under the equity plan, discourages short-term risk-taking; and |
| • | the approach to goal setting, setting of targets with payouts at multiple levels of performance, capping the amount of the Company’s incentive payouts, and the evaluation of performance results assist in mitigating excessive risk-taking. |
To complement the existing risk-reducing features of the Company’s compensation policies and practices, the Company has stock ownership guidelines, an anti-hedging policy, an Insider Trading Policy and a Clawback Policy. The Compensation Committee will continue to monitor the Company’s compensation policies and practices to determine whether its risk management objectives are being met.
34
Table of Contents
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning the compensation of our NEOs.
| Name, principal position |
Year | Salary | Non-Equity incentive plan compensation |
Stock (1) (2) |
All other compensation (3) |
Total | ||||||||||||||||||
| Robert Kay |
2024 | $ | 1,000,000 | $ | 998,667 | $ | 1,854,400 | $ | 54,875 | $ | 3,907,942 | |||||||||||||
| Chief Executive Officer |
2023 | 983,462 | 835,100 | 888,000 | 53,675 | 2,760,237 | ||||||||||||||||||
| 2022 | 900,000 | 225,000 | 2,401,430 | 55,175 | 3,581,605 | |||||||||||||||||||
| Daniel Siegel President |
2024 | 725,000 | 725,500 | 390,400 | 18,000 | 1,858,900 | ||||||||||||||||||
| 2023 | 673,254 | 598,317 | 207,200 | 18,000 | 1,496,771 | |||||||||||||||||||
| 2022 | 650,000 | 243,750 | 402,270 | 18,000 | 1,314,020 | |||||||||||||||||||
| Laurence Winoker Executive Vice President, Treasurer and Chief Financial Officer |
2024 | 460,000 | 306,900 | 244,000 | 12,000 | 1,022,900 | ||||||||||||||||||
| 2023 | 446,250 | 226,200 | 130,240 | 12,000 | 814,690 | |||||||||||||||||||
| 2022 | 425,000 | 106,250 | 195,040 | 12,000 | 738,290 | |||||||||||||||||||
Notes:
| (1) | Represents the aggregate grant date fair value of the awards as determined under Financial Accounting Standards Board Accounting Standards Codification Topic No. 718-20, Awards Classified as Equity, which was recognized by the Company for awards granted during 2024, 2023 and 2022. For information, including assumptions, regarding the valuation of these awards refer to Note 9 to the Company’s Consolidated Financial Statements for the year ended December 31, 2024 included in the 2024 Annual Report and the Company’s discussion of Significant Accounting Policies under the heading “Share-based compensation” included on page F-12 of the 2024 Annual Report. |
| (2) | The grant date fair value of the performance shares included in this column is the target payout based on the probable outcome of the performance-based conditions determined as of the grant date. The maximum potential payout of the performance-share awards is 150% of the target shares awarded on the grant date. The maximum value of the performance shares granted in 2024 determined as of the grant date would be as follows for each respective executive officer: Mr. Kay: $1,390,800, Mr. D. Siegel: $292,800, and Mr. Winoker: $183,000. |
| (3) | All Other Compensation includes the following: |
|
Name |
Year |
Insurance |
Automobile |
Professional |
Total all other |
|||||||||||||||
| Robert Kay | 2024 | $ | 29,425 | $ | 18,000 | $ | 7,450 | $ | 54,875 | |||||||||||
| 2023 | 29,425 | 18,000 | 6,250 | 53,675 | ||||||||||||||||
| 2022 | 29,425 | 18,000 | 7,750 | 55,175 | ||||||||||||||||
| Daniel Siegel | 2024 | — | 18,000 | — | 18,000 | |||||||||||||||
| 2023 | — | 18,000 | — | 18,000 | ||||||||||||||||
| 2022 | — | 18,000 | — | 18,000 | ||||||||||||||||
| Laurence Winoker | 2024 | — | 12,000 | — | 12,000 | |||||||||||||||
| 2023 | — | 12,000 | — | 12,000 | ||||||||||||||||
| 2022 | — | 12,000 | — | 12,000 | ||||||||||||||||
NEO EMPLOYMENT AGREEMENTS DURING 2024
Robert B. Kay
During 2024, Robert B. Kay was employed by us as the Chief Executive Officer of the Company pursuant to an employment agreement with the Company, dated as of December 22, 2017, which became effective upon the closing of the Filament Acquisition on March 2, 2018 and was amended as of January 1, 2019, March 3, 2021, and March 2, 2023 (the “Kay Employment Agreement”).
The Kay Employment Agreement provides for a term through the third anniversary of the consummation of the Filament Acquisition, March 2, 2021, with automatic renewals for additional one-year periods, unless notice of non-renewal is provided by us or Mr. Kay. The Kay Employment Agreement currently provides for an annual base salary of $1,000,000 and an automobile allowance of up to $1,500 per month. The Kay Employment Agreement further provides for the reimbursement to Mr. Kay of up to a total of $40,000 during any calendar year for legal, financial and other professional services.
35
Table of Contents
The Kay Employment Agreement provides Mr. Kay with the opportunity to receive an Annual Adjusted EBITDA Performance Bonus and an Annual Individual Goal Bonus based on certain measurable objectives as described under Annual Bonuses.
The Kay Employment Agreement further provides for payments to Mr. Kay upon the termination of his employment under certain circumstances, as described under Potential Payments Upon Termination or Change of Control.
Daniel Siegel
During 2024, Daniel Siegel was employed by us as our President pursuant to an employment agreement dated as of November 8, 2017, effective as of January 1, 2018 and amended as of January 1, 2019, January 1, 2021, January 1, 2023, and November 2023 (the “D. Siegel Employment Agreement”).
The D. Siegel Employment Agreement provides that the term of Mr. D. Siegel’s employment is through December 31, 2020, with automatic renewals for additional one-year periods unless notice of non-renewal is provided by us or Mr. D. Siegel. The D. Siegel Employment Agreement currently provides for an annual base salary of $725,000.
The D. Siegel Employment Agreement provides certain perquisites, including an automobile allowance of $1,500 per month. The D. Siegel Employment Agreement also entitles Mr. D. Siegel to receive an Annual Adjusted EBITDA Performance Bonus and an Annual Individual Goal Bonus based on certain measurable objectives as described under Annual Bonuses.
The D. Siegel Employment Agreement further provides for payments to Mr. D. Siegel upon the termination of his employment under certain circumstances as described under Potential Payments Upon Termination or Change of Control.
Laurence Winoker
During 2024, Laurence Winoker was employed by us as Executive Vice President, Treasurer and Chief Financial Officer pursuant to an employment agreement, amended and restated as of September 10, 2015 and further amended as of November 8, 2017, January 1, 2019, August 1, 2022, January 1, 2023, and November 8, 2023 (the “Winoker Amended and Restated Employment Agreement”).
The Winoker Amended and Restated Employment Agreement provides for an annual base salary of $446,250, which was increased to $460,000, effective January 1, 2024. Mr. Winoker received a merit increase as described under Base Salary.
The Winoker Amended and Restated Employment Agreement also provides for an Annual Adjusted EBITDA Performance Bonus and an Annual Individual Goal Bonus based on certain measurable objectives as described under Annual Bonuses and certain perquisites, including an automobile allowance of $1,000 per month.
The Winoker Amended and Restated Employment Agreement further provides for payments to Mr. Winoker upon the termination of his employment under certain circumstances as described under Potential Payments Upon Termination or Change of Control.
36
Table of Contents
GRANTS OF PLAN-BASED AWARDS DURING FISCAL YEAR ENDED DECEMBER 31, 2024
The following table sets forth information regarding grants of plan-based compensation to the NEOs during 2024.
| Name | Grant date | Estimated possible payouts under non-equity incentive plan awards (1) |
Estimated future payouts under equity incentive plan awards (2) |
All other stock awards: number of shares of stock (#) |
All other option awards: number of securities underlying options (#) |
Exercise or base price of option awards ($) |
Grant date fair value of stock and option awards ($) | |||||||||||||||||||||
| Threshold ($) |
Target ($) |
Maximum ($) |
Threshold (#) |
Target (#) |
Maximum (#) | |||||||||||||||||||||||
| Robert Kay |
||||||||||||||||||||||||||||
| Annual Incentive Plan |
562,500 | 1,125,000 | 2,000,000 | |||||||||||||||||||||||||
| Restricted Shares |
March 8, 2024 | 95,000 (3) | 927,200 | |||||||||||||||||||||||||
| Performance Shares |
March 8, 2024 | 71,250 | 95,000 | 142,500 | 927,200 | |||||||||||||||||||||||
| Daniel Siegel |
||||||||||||||||||||||||||||
| Annual Incentive Plan |
407,813 | 815,625 | 1,087,500 | |||||||||||||||||||||||||
| Restricted Shares |
March 8, 2024 | 20,000 (3) | 195,200 | |||||||||||||||||||||||||
| Performance Shares |
March 8, 2024 | 15,000 | 20,000 | 30,000 | 195,200 | |||||||||||||||||||||||
| Laurence Winoker |
||||||||||||||||||||||||||||
| Annual Incentive Plan |
172,500 | 345,000 | 575,000 | |||||||||||||||||||||||||
| Restricted Shares |
March 8, 2024 | 12,500 (3) | 122,000 | |||||||||||||||||||||||||
| Performance Shares |
March 8, 2024 | 9,375 | 12,500 | 18,750 | 122,000 | |||||||||||||||||||||||
Notes:
| (1) | The threshold, target and maximum payouts disclosed in the table above include the Annual Adjusted EBITDA Performance Bonus and the Annual Individual Goal Bonus for each of the NEOs. |
| (2) | The threshold, target and maximum performance share amounts represent possible future payout of our common stock underlying performance shares granted in 2024. These awards will vest based on cumulative performance metrics over a three-year performance period (January 1, 2024 through December 31, 2026), with threshold, target and maximum awards equal to 75%, 100% and 150%, respectively, of the target number of performance shares granted. If the minimum performance goals are not met at the end of the three-year period, no shares will be paid pursuant to the performance shares. |
| (3) | Represents restricted stock granted under the Amended and Restated 2000 Long-Term Incentive Plan. The restricted stock vests 25% per year in four equal installments commencing on the first anniversary of the date of grant. |
OPTION EXERCISES AND STOCK VESTED DURING FISCAL YEAR ENDED DECEMBER 31, 2024
| Option Awards | Restricted Stock Awards and Performance Shares |
|||||||||||||||
| Name |
Number of shares exercise |
Value realized |
Number of shares vesting |
Value realized on |
||||||||||||
| Robert Kay |
— | $ | — | 129,329 | $ | 1,258,026 | ||||||||||
| Daniel Siegel |
— | $ | — | 26,987 | $ | 260,752 | ||||||||||
| Laurence Winoker |
— | $ | — | 12,926 | $ | 124,257 | ||||||||||
| (1) | Stock awards value realized is determined by multiplying (i) the closing market price of the Company’s common stock on the vesting date by (ii) the number of shares of common stock that vested on that date. |
37
Table of Contents
OUTSTANDING EQUITY AWARDS HELD BY NEOs AT DECEMBER 31, 2024
| Option Awards |
Stock Awards | |||||||||||||||||||||||||||||||
| Name | Number of securities underlying unexercised options (#) exercisable |
Number of securities underlying unexercised options (#) unexercisable |
Option exercise price ($) |
Option expiration date |
Number of Shares or Units of Stock that have not vested (#) |
Market Value of Shares or Units of Stock that have not vested ($) |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that have not vested (#) |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that have not vested ($) |
||||||||||||||||||||||||
| Robert Kay | ||||||||||||||||||||||||||||||||
| Stock Options | 150,000 | (1) | $13.75 | March 2, 2028 | ||||||||||||||||||||||||||||
| 250,000 | (2) | $9.21 | June 27, 2029 | |||||||||||||||||||||||||||||
| Restricted Shares |
|
18,491 | (3) | 109,282 | (4) | |||||||||||||||||||||||||||
| 49,250 | (5) | 291,068 | (4) | |||||||||||||||||||||||||||||
| 56,250 | (6) | 332,438 | (4) | |||||||||||||||||||||||||||||
| 95,000 | (7) | 561,450 | (4) | |||||||||||||||||||||||||||||
| Performance Shares |
|
98,500 | (8) | 582,135 | (4) | |||||||||||||||||||||||||||
| 75,000 | (9) | 443,250 | (4) | |||||||||||||||||||||||||||||
| 95,000 | (10) | 561,450 | (4) | |||||||||||||||||||||||||||||
| Daniel Siegel |
|
|||||||||||||||||||||||||||||||
| Restricted Shares | 3,750 | (3) | 22,163 | (4) | ||||||||||||||||||||||||||||
| 8,250 | (5) | 48,758 | (4) | |||||||||||||||||||||||||||||
| 13,125 | (6) | 77,569 | (4) | |||||||||||||||||||||||||||||
| 20,000 | (7) | 118,200 | (4) | |||||||||||||||||||||||||||||
| Performance Shares | 16,500 | (8) | 97,515 | (4) | ||||||||||||||||||||||||||||
| 17,500 | (9) | 103,425 | (4) | |||||||||||||||||||||||||||||
| 20,000 | (10) | 118,200 | (4) | |||||||||||||||||||||||||||||
| Laurence Winoker |
|
|||||||||||||||||||||||||||||||
| Restricted Shares | 1,563 | (3) | 9,237 | (4) | ||||||||||||||||||||||||||||
| 4,000 | (5) | 23,640 | (4) | |||||||||||||||||||||||||||||
| 8,250 | (6) | 48,758 | (4) | |||||||||||||||||||||||||||||
| 12,500 | (7) | 73,875 | (4) | |||||||||||||||||||||||||||||
| Performance Shares | 8,000 | (8) | 47,280 | (4) | ||||||||||||||||||||||||||||
| 11,000 | (9) | 65,010 | (4) | |||||||||||||||||||||||||||||
| 12,500 | (10) | 73,875 | (4) | |||||||||||||||||||||||||||||
Notes:
| (1) | This option was granted on March 2, 2018 and vested 33% a year in three equal annual installments commencing on the first anniversary of the date of grant. |
| (2) | This option was granted on June 27, 2019 and vested 33% a year in three equal annual installments commencing on the first anniversary of the date of grant. |
| (3) | These restricted shares were granted on March 9, 2021 and vest 25% per year in four equal annual installments commencing on the first anniversary of the date of grant. |
| (4) | Calculated using a price per share of $5.91, the closing market price of the Company’s common stock as reported by the Nasdaq Stock Market on December 31, 2024, the end of the Company’s last completed fiscal year. |
| (5) | These restricted shares were granted on March 8, 2022 and vest 25% per year in four equal annual installments commencing on the first anniversary of the date of grant. |
| (6) | These restricted shares were granted on March 8, 2023 and vest 25% per year in four equal annual installments commencing on the first anniversary of the date of grant. |
| (7) | These restricted shares were granted on March 8, 2024 and vest 25% per year in four equal annual installments commencing on the first anniversary of the date of grant. |
| (8) | These performance shares were granted on March 8, 2022. These awards vest upon the achievement of performance measures based on cumulative performance metrics over a three-year performance period (January 1, 2022 through December 31, 2024), with threshold, target and maximum awards equal to 75%, 100% and 150%, respectively, of the number of performance shares granted. The number of shares reflected assumes the target level of performance achievement which would result in the performance shares vesting at 100% of the target. The performance metrics for the performance period were not achieved and therefore no shares were earned by Mr. Kay, Mr. D. Siegel and Mr. Winoker. |
| (9) | These performance shares were granted on March 8, 2023. These awards vest upon the achievement of performance measures based on a cumulative performance metrics over a three-year performance period (January 1, 2023 through December 31, 2025), with threshold, target and maximum awards equal to 75%, 100% and 150%, respectively, of the number of performance shares granted. The number of shares reflected assumes the target level of performance achievement which would result in the performance shares vesting at 100% of the target. |
| (10) | These performance shares were granted on March 8, 2024. These awards vest upon the achievement of performance measures based on a cumulative performance metrics over a three-year performance period (January 1, 2024 through December 31, 2026), with threshold, target and maximum awards equal to 75%, 100% and 150%, respectively, of the number of performance shares granted. The number of shares reflected assumes the target level of performance achievement which would result in the performance shares vesting at 100% of the target. |
38
Table of Contents
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
The employment agreements that we have entered into with each of the NEOs require us to make certain payments to these individuals in the event of a termination of their employment outside of or in connection with a change of control of the Company. We believe that the arrangements with respect to a change of control termination are appropriate to allow the NEOs to focus on our interests in a change of control situation without distractions relating to their employment. Notwithstanding provisions contained in the respective NEO’s employment agreement, all equity awards are subject to the provisions of the Amended and Restated 2000 Long-Term Incentive Plan, as it may be amended from time to time.
The following table shows estimated payments that would have been made to each of our NEOs pursuant to their employment agreements and outstanding equity award agreements as of December 31, 2024 under various scenarios involving a termination of employment outside of or in connection with a change of control of the Company, assuming that each individual’s employment was terminated on December 31, 2024 and using the closing market price of our common stock as of December 31, 2024:
|
Upon Termination as a Result of a Disability
|
||||||||||||
|
Payment |
Robert Kay |
Daniel Siegel |
Laurence Winoker |
|||||||||
| Cash severance |
$500,000 | $362,500 | $230,000 | |||||||||
| Awarded but unpaid bonus |
$998,667 | $725,500 | $306,900 | |||||||||
| Options (intrinsic value) |
— | — | — | |||||||||
| Restricted shares (intrinsic value) |
— | — | — | |||||||||
| Accrued salary |
$7,692 | $5,577 | $3,538 | |||||||||
| Accrued vacation |
$230,769 | $27,885 | $17,693 | |||||||||
| Unreimbursed expenses |
— | — | — | |||||||||
| TOTAL |
$1,737,128 | $1,121,462 | $558,131 | |||||||||
|
Upon Termination as a Result of a Death
|
||||||||||||
| Payment | Robert Kay | Daniel Siegel | Laurence Winoker | |||||||||
| Cash severance |
— | — | — | |||||||||
| Awarded but unpaid bonus |
$998,667 | $725,500 | $306,900 | |||||||||
| Options (intrinsic value) |
— | — | — | |||||||||
| Restricted shares (intrinsic value) |
— | — | — | |||||||||
| Accrued salary |
$7,692 | $5,577 | $3,538 | |||||||||
| Accrued vacation |
$230,769 | $27,885 | $17,693 | |||||||||
| Unreimbursed expenses |
— | — | — | |||||||||
| TOTAL |
$1,237,128 | $758,962 | $328,131 | |||||||||
|
Upon Termination by the Company for Cause or by the Executive without Good Reason
|
||||||||||||
| Payment | Robert Kay | Daniel Siegel | Laurence Winoker | |||||||||
| Awarded but unpaid bonus |
— | — | $306,900 | |||||||||
| Accrued salary |
$7,692 | $5,577 | $3,538 | |||||||||
| Accrued vacation |
$230,769 | $27,885 | $17,693 | |||||||||
| Unreimbursed expenses |
— | — | — | |||||||||
| TOTAL |
$238,461 | $33,462 | $328,131 | |||||||||
39
Table of Contents
|
Upon Termination in Connection with a Change of Control of the Company
|
||||||||||||
| Payment | Robert Kay | Daniel Siegel | Laurence Winoker | |||||||||
| Cash severance |
$4,250,000 | $3,081,250 | $1,610,000 | |||||||||
| Awarded but unpaid bonus |
$998,667 | $725,500 | $306,900 | |||||||||
| Options (intrinsic value) |
— | — | — | |||||||||
| Restricted shares and performance shares (intrinsic value) (1) |
$2,881,072 | $585,829 | $341,675 | |||||||||
| Health benefits |
$8,510 | $14,923 | $10,686 | |||||||||
| Unreimbursed expenses |
— | — | — | |||||||||
| Accrued salary |
$7,692 | $5,577 | $3,538 | |||||||||
| Accrued vacation |
$230,769 | $27,885 | $17,693 | |||||||||
| TOTAL |
$8,376,710 | $4,440,964 | $2,290,492 | |||||||||
|
Upon All Other Termination by the Company or by the Executive for Good Reason
|
||||||||||||
| Payment | Robert Kay (2) | Daniel Siegel (3) | Laurence Winoker (4) | |||||||||
| Cash severance |
$4,250,000 | $3,081,250 | $1,610,000 | |||||||||
| Awarded but unpaid bonus |
$998,667 | $725,500 | $306,900 | |||||||||
| Options (intrinsic value) |
— | — | — | |||||||||
| Restricted shares (intrinsic value) |
$1,294,237 | $266,689 | $155,510 | |||||||||
| Health benefits |
$8,510 | $14,923 | $10,686 | |||||||||
| Accrued salary |
$7,692 | $5,577 | $3,538 | |||||||||
| Accrued vacation |
$230,769 | $27,885 | $17,693 | |||||||||
| TOTAL |
$6,789,875 | $4,121,824 | $2,104,327 | |||||||||
Notes:
| (1) | Includes the vesting at target value of performance shares with open performance periods as of December 31, 2024, which would vest in the event of such termination within 24 months following a change of control of the Company. |
| (2) | $1,000,000 of such cash severance amount would be payable to Mr. Kay pursuant to his current employment agreement if his employment was terminated by non-renewal upon the expiration of the term of his employment agreement. |
| (3) | $725,000 of such cash severance amount would be payable to Mr. D. Siegel pursuant to his employment agreement if his employment was terminated by non-renewal upon expiration of the term of his employment agreement. |
| (4) | $460,000 of such cash severance amount would be payable to Mr. Winoker pursuant to his employment agreement if his employment was terminated by non-renewal upon expiration of the term of his employment agreement. |
Robert B. Kay
The Kay Employment Agreement contains the following provisions regarding the termination of Mr. Kay’s employment outside of or in connection with a change of control of the Company.
Termination for Cause; Resignation without Good Reason
If Mr. Kay’s employment is terminated by us for Cause or if Mr. Kay resigns other than for Good Reason (in each case, as defined by the Kay Employment Agreement), Mr. Kay will be entitled to be paid the following amounts (collectively, the “Kay Accrued Obligations”):
| • | His base salary accrued up to and including the date of termination or resignation of his employment; |
| • | An amount in lieu of any accrued but unused vacation time; |
| • | The amount of any unreimbursed expenses; and |
| • | All benefits that are accrued and vested through the date of termination under all employee benefit plans of the Company. |
40
Table of Contents
Death
If Mr. Kay’s employment terminates on account of his death, then Mr. Kay’s estate will receive the Kay Accrued Obligations plus any Pro-Rated Performance Bonus accrued through the date of his termination of employment. The “Pro-Rated Performance Bonus” for a particular fiscal year is the amount equal to the Annual Adjusted EBITDA Performance Bonus for the fiscal year that would have been payable to Mr. Kay, if his employment had not terminated during the year, pro-rated for the months during the year up to and including the month of the termination.
Termination Due to Disability
If Mr. Kay’s employment terminates on account of Total Disability (as defined by the Kay Employment Agreement), then in addition to the Kay Accrued Obligations, Mr. Kay will receive, conditioned on his execution and non-revocation of a release of claims against the Company, continued payments of base salary for six months following his termination of employment (except that payment will be made in a lump sum if Mr. Kay’s termination due to Total Disability occurs within two years following a “Change of Control”, as defined by the Kay Employment Agreement) and any Pro-Rated Performance Bonus (as defined above) accrued through the date of his termination.
Termination by the Company without Cause; Resignation by the Executive for Good Reason
If Mr. Kay’s employment is terminated (i) by us without Cause or (ii) by Mr. Kay for Good Reason, in each case outside of the context of a Change of Control, then in addition to the Kay Accrued Obligations, Mr. Kay will receive, conditioned on his execution and non-revocation of a release of all claims against the Company:
| • | Reimbursement for certain medical and dental expenses set forth in the Kay Employment Agreement for a period of 12 months; |
| • | 2.0 times Mr. Kay’s base salary as in effect at the date of termination payable over a period of 24 months following the date of termination; |
| • | The Pro-Rated Performance Bonus for the fiscal year in which termination occurs, payable at the same time as the performance bonus for such fiscal year would otherwise have been paid; |
| • | 2.0 times an amount equal to 112.5% of Mr. Kay’s annual base salary in effect at the time of termination (such amount, the “Kay Target Bonus”) payable within 60 days following the termination date; and |
| • | Mr. Kay’s then-outstanding stock options will immediately vest and become exercisable in their entirety and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP. |
Termination upon Expiration of Term
If Mr. Kay’s employment is terminated by reason of our failure to renew his employment agreement, outside the context of a Change of Control, then in addition to the Kay Accrued Obligations, Mr. Kay will receive, conditioned upon his execution and non-revocation of a release of all claims against the Company:
| • | Reimbursement for certain medical and dental benefits set forth in the Kay Employment Agreement for a period of 12 months; |
| • | 1.0 times Mr. Kay’s base salary as in effect at the date of termination payable over a period of 12 months following the date of termination; |
| • | The Annual Adjusted EBITDA Performance Bonus for the fiscal year in which termination occurs, payable at the same time as the Annual Adjusted EBITDA Performance Bonus for such fiscal year would otherwise have been paid; and |
| • | Mr. Kay’s then-outstanding stock options will immediately vest and become exercisable in their entirety and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP. |
Termination by the Company without Cause or on account of Non-Renewal in connection with Certain Changes of Control, Resignation by the Executive for Good Reason in Connection with Certain Changes of Control
If Mr. Kay’s employment is terminated by Mr. Kay for Good Reason or by us without Cause or by us upon expiration of the term following delivery of a notice of non-renewal, in each case upon or within two years following a Change of Control, then in addition to the Kay Accrued Obligations, Mr. Kay will receive, conditioned upon his execution and non-revocation of a release of all claims against the Company:
| • | Reimbursement for certain medical and dental benefits set forth in the Kay Employment Agreement for a period of 12 months; |
| • | 2.0 times Mr. Kay’s annual base salary in effect at the effective date of the Change of Control, or if greater, 2.0 times his annual base salary in effect as of his termination of employment payable in a lump sum within 60 days following the date of termination; |
41
Table of Contents
| • | The Pro-Rated Performance Bonus for the fiscal year in which termination occurs, payable at the same time as the Annual Adjusted EBITDA Performance Bonus for such fiscal year would otherwise have been paid; |
| • | 2.0 times the Kay Target Bonus, using the greater of Mr. Kay’s base salary in effect at the time of termination and base salary in effect at the time of the Change of Control, payable in a lump sum within 60 days following the date of termination; and |
| • | Mr. Kay’s then-outstanding stock options will vest and become immediately exercisable and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP. |
If Mr. Kay’s employment is terminated by Mr. Kay for Good Reason or by us without Cause or upon expiration of the term following delivery of a notice of non-renewal, and in each case, within 90 days following such termination, a Change of Control occurs, then Mr. Kay will be entitled to receive a payment equal to the excess of the base salary severance payments that would have been due to him had he been terminated within two years following a Change of Control, less the amount of base salary severance payments already paid to him. Additionally, in the event that such termination is on account of our delivery of a notice of non-renewal, Mr. Kay will be entitled to receive two times the Kay Target Bonus, and both amounts are payable within 60 days following the Change of Control.
If all or any portion of the payments and benefits would constitute a “parachute payment” within the meaning of Section 280G of the Code (or a similar or successor provision), we will reduce such payments if, by reason of such reduction, the net after-tax benefit to Mr. Kay will exceed the net after-tax benefit to him if such reduction were not made.
Daniel Siegel
The D. Siegel Employment Agreement contains the following terms regarding the termination of Mr. D. Siegel’s employment and a change of control of the Company.
Termination for Cause; Resignation without Good Reason
If Mr. D. Siegel’s employment is terminated by us for Cause or by Mr. D. Siegel without Good Reason (in each case, as defined by the D. Siegel Employment Agreement), Mr. D. Siegel will be entitled to be paid the following amounts (collectively, “D. Siegel Accrued Obligations”):
| • | His base salary for the period accrued up to and including the date of termination of his employment; |
| • | An amount in lieu of any accrued but unused vacation time; |
| • | The amount of any unreimbursed expenses; and |
| • | All benefits that are accrued and vested through the date of termination under all employee benefit plans of the Company. |
Death
If Mr. D. Siegel’s employment terminates on account of his death, then Mr. D. Siegel’s estate will receive the D. Siegel Accrued Obligations plus any Pro-Rated Performance Bonus accrued through the date of his termination of employment. The “Pro-Rated Performance Bonus” for a particular fiscal year is the amount equal to the Annual Adjusted EBITDA Performance Bonus for the fiscal year that would have been payable to Mr. D. Siegel, if his employment had not terminated during the year, pro-rated for the months during the year up to and including the month of the termination.
Termination Due to Disability
If Mr. D. Siegel’s employment terminates on account of Total Disability (as defined by the D. Siegel Employment Agreement), then in addition to the D. Siegel Accrued Obligations, Mr. D. Siegel will receive, conditioned upon his execution and non-revocation of an effective release of all claims against the Company, continued payments of base salary for six months following his termination of employment (except that payment will be made in a lump sum if Mr. D. Siegel’s termination due to Total Disability occurs within two years following a Change of Control, as defined by the D. Siegel Employment Agreement) and any Pro-Rated Performance Bonus accrued through the date of his termination.
42
Table of Contents
Termination by the Company without Cause; Resignation by the Executive for Good Reason
If (i) Mr. D. Siegel’s employment is terminated by us without Cause, or (ii) Mr. D. Siegel’s employment is terminated by Mr. D. Siegel for Good Reason, in each case outside of the context of a Change of Control, then in addition to the D. Siegel Accrued Obligations, Mr. D. Siegel will receive, conditioned upon his execution and non-revocation of a release of all claims against the Company:
| • | Certain medical and dental benefits set forth in the D. Siegel Employment Agreement for a period of 12 months; |
| • | 2.0 times Mr. D. Siegel’s base salary as in effect at the date of termination payable over a period of 24 months following the date of termination; |
| • | The Pro-Rated Performance Bonus for the fiscal year in which the termination occurs, payable at the same time as the Performance Bonus for such fiscal year would otherwise have been paid; |
| • | 2.0 times an amount equal to 112.5% of Mr. D. Siegel’s annual base salary in effect at the time of termination (such amount, the “D. Siegel Target Bonus”) payable within 60 days following termination; and |
| • | Mr. D. Siegel’s then-outstanding stock options will immediately vest and become exercisable in their entirety and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP. |
Termination upon Expiration of Term
If Mr. D. Siegel’s employment is terminated by reason of our failure to renew the term of his employment under his employment agreement, then in addition to the D. Siegel Accrued Obligations, Mr. D. Siegel will be entitled to receive, conditioned on his execution and non-revocation of a release of all claims against the Company:
| • | Certain medical and dental benefits set forth in the D. Siegel Employment Agreement for a period of 12 months; |
| • | 1.0 times Mr. D. Siegel’s base salary as in effect at the date of termination payable over a period of 12 months following the date of termination; |
| • | The Annual Adjusted EBITDA Performance Bonus for the fiscal year in which termination occurs; and |
| • | Mr. D. Siegel’s then-outstanding stock options will immediately vest and become exercisable in their entirety and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP. |
Termination by the Company without Cause or on Account of Non-Renewal in Connection with Certain Changes of Control, Resignation by the Executive for Good Reason in Connection with Certain Changes of Control
If Mr. D. Siegel’s employment is terminated by Mr. D. Siegel for Good Reason or by us without Cause or upon expiration of the term following our delivery of a notice of non-renewal, in each case upon or within two years following a Change of Control, then in addition to the D. Siegel Accrued Obligations, Mr. D. Siegel will be entitled to receive, conditioned on his execution and non-revocation of a release of all claims against the Company:
| • | Certain medical and dental benefits set forth in his employment agreement for a period of 12 months; |
| • | 2.0 times his annual base salary in effect at the effective date of the Change of Control, or if greater, 2.0 times his annual base salary in effect as of his termination of employment, payable in a lump sum within 60 days following termination; |
| • | The Pro-Rated Performance Bonus for the fiscal year in which termination occurs, payable at the same time as the Annual Adjusted EBITDA Performance Bonus for such fiscal year would otherwise have been paid; |
| • | 2.0 times the D. Siegel Target Bonus, using the greater of Mr. D. Siegel’s base salary in effect at the time of termination and base salary in effect at the time of the Change of Control, payable in a lump sum within 60 days following termination; and |
| • | All of Mr. D. Siegel’s then-outstanding stock options will vest and become immediately exercisable and all restrictions on his shares of restricted stock granted will immediately terminate, subject to the terms of the LTIP. |
If Mr. D. Siegel’s employment is terminated by Mr. D. Siegel for Good Reason or by us without Cause or upon expiration of the term following our delivery of a notice of non-renewal, and in each case, within 90 days following such termination, a Change of Control occurs, then Mr. D. Siegel will be entitled to receive a payment equal to the excess of the base salary severance payments that would have been due to him had he been terminated within two years following a Change of Control, less the amount of base salary severance payments already paid to him. Additionally, in the event that such termination is on account of our delivery of a notice of non-renewal, Mr. D. Siegel will be entitled to receive two times the D. Siegel Target Bonus, payable within 60 days following the Change of Control.
43
Table of Contents
If all or any portion of the payments and benefits would constitute a “parachute payment” within the meaning of Section 280G of the Code (or a similar or successor provision), we will reduce such payments if, by reason of such reduction, the net after-tax benefit to Mr. D. Siegel will exceed the net after-tax benefit to him if such reduction were not made.
Laurence Winoker
The Winoker Employment Agreement contains the following terms regarding the termination of his employment and a change of control of the Company.
Termination for Cause; Resignation without Good Reason
If Mr. Winoker’s employment is terminated by us for Cause or by Mr. Winoker without Good Reason (in each case, as defined by the Winoker Employment Agreement), Mr. Winoker will be entitled to the following (collectively, the “Winoker Accrued Obligations”):
| • | His base salary accrued up to and including the date of termination of his employment; |
| • | An amount in lieu of any accrued but unused vacation time; |
| • | Any accrued but unpaid bonus; |
| • | The amount of any unreimbursed expenses; and |
| • | Any vested rights that Mr. Winoker may have pursuant to any insurance or other death benefit, bonus, retirement, or stock award plans or arrangements of the Company or any other employee benefit program. |
Death
If Mr. Winoker’s employment is terminated by reason of Mr. Winoker’s death, then Mr. Winoker’s estate will receive the Winoker Accrued Obligations. In addition, if Mr. Winoker’s employment is terminated prior to December 1 of any year, Mr. Winoker’s estate will receive any Pro-Rated Adjusted EBITDA Performance Bonus accrued through the date of termination of employment. The “Pro-Rated Adjusted EBITDA Performance Bonus” for a particular fiscal year is the amount equal to the Adjusted EBITDA Performance Bonus for the fiscal year that would have been payable to Mr. Winoker by the Company, as determined by the Board, if Mr. Winoker’s employment had not terminated during the year, pro-rated for the months during the year up to and including the month of the termination.
Termination Due to Disability
If Mr. Winoker’s employment is terminated on account of Total Disability (as defined by the Winoker Employment Agreement), then in addition to the Winoker Accrued Obligations, Mr. Winoker will receive, conditioned on his execution and non-revocation of a release of all claims against the Company, continued payments of his base salary for a period of six months following the date of termination, and if such termination occurs prior to December 1, the Pro-Rated Adjusted EBITDA Performance Bonus for the year of termination.
Termination by the Company without Cause, Resignation by the Executive for Good Reason
If (i) Mr. Winoker’s employment is terminated by us without Cause, or (ii) Mr. Winoker’s employment is terminated by Mr. Winoker for Good Reason, in each case outside of the context of a Change of Control (as defined by the Winoker Amended and Restated Employment Agreement), then in addition to the Accrued Obligations, Mr. Winoker will be entitled to receive, conditioned on his execution and non-revocation of a release of all claims against the Company:
| • | Certain medical and dental benefits set forth in Winoker Amended and Restated Employment Agreement for a period of 12 months; |
| • | 2.0 times Mr. Winoker’s base salary as in effect at the date of termination payable over a period of 24 months from the date of termination; |
| • | The Pro-Rated Annual Bonus for the fiscal year in which termination occurs, payable at the same time as the Performance Bonus for such fiscal year would otherwise have been paid. The “Pro-Rated Annual Bonus” for a particular fiscal year is the amount equal to the annual bonus for the fiscal year that would have been payable to Mr. Winoker by the Company, as determined by the Board, if Mr. Winoker’s employment had not terminated during the year, pro-rated for the months during the year preceding the termination; and |
| • | 2.0 times an amount equal to 75% of Mr. Winoker’s annual base salary in effect at the time of termination (such amount, the “Winoker Target Bonus”), payable within 60 days following termination. |
44
Table of Contents
Mr. Winoker’s then-outstanding stock options will immediately vest and become exercisable in their entirety and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP.
Termination upon Expiration of Term
If Mr. Winoker’s employment is terminated by reason of our failure to renew the Winoker Amended and Restated Employment Agreement, outside the context of a Change of Control, then in addition to the Accrued Obligations, Mr. Winoker will receive, conditioned on his execution and non-revocation of a release of all claims against the Company:
| • | Reimbursement for certain medical and dental benefits set forth in the Winoker Amended and Restated Employment Agreement for a period of 12 months; |
| • | An amount equal to Mr. Winoker’s base salary as in effect upon termination, payable over a period of 12 months from the date of termination; and |
| • | The annual bonus for the fiscal year in which the effective date of the termination occurs, payable at the same time as the annual bonus for such fiscal year would otherwise have been paid. |
Mr. Winoker’s then-outstanding stock options will immediately vest and become exercisable and all restrictions on shares of restricted stock granted by us to Mr. Winoker will immediately terminate, subject to the terms of the LTIP.
Termination by the Company without Cause or on Account of Non-Renewal, Resignation by the Executive for Good Reason in Connection with Certain Changes of Control
If, during the term of Mr. Winoker’s employment, Mr. Winoker is terminated by the Company without Cause, Mr. Winoker voluntarily terminates his employment for Good Reason, or Mr. Winoker’s employment terminates upon expiration of the term following a notice of non-renewal provided by us, in each case upon or within two years following a Change of Control, then in addition to the Winoker Accrued Obligations, Mr. Winoker will be entitled to receive, conditioned upon his execution and non-revocation of a release of all claims against the Company:
| • | Reimbursement for certain medical and dental benefits set forth in the Winoker Amended and Restated Employment Agreement for a period of 12 months. |
| • | A cash payment equal to 200% of Mr. Winoker’s base salary in effect at the effective date of the Change of Control or if greater, 200% of Mr. Winoker’s base salary in effect at the effective date of termination, payable in a lump sum within 60 days following termination; |
| • | The Pro-Rated Performance Bonus for the fiscal year in which termination occurs, payable at the same time as the annual bonus for such fiscal year would otherwise have been paid; and |
| • | 2.0 times the Winoker Target Bonus, using the greater of Mr. Winoker’s annual base salary in effect at the time of termination and annual base salary in effect at the time of the Change of Control, payable in a lump sum within 60 days following termination. |
All of Mr. Winoker’s then-outstanding stock options will vest and become immediately exercisable and all restrictions on his shares of restricted stock will immediately terminate, subject to the terms of the LTIP.
In the event that Mr. Winoker’s employment is terminated by Mr. Winoker for Good Reason or by us without Cause or upon expiration of the term following delivery of a notice of non-renewal provided by us, and in each case, within 90 days of the termination, we execute a definitive agreement to enter into a transaction the consummation of which would result in a Change of Control and such transaction is actually consummated, then Mr. Winoker will be entitled to receive a payment equal to the excess of the base salary severance payments that would have been due to him had he been terminated within two years following a Change of Control, less the amount of base salary severance payments already paid to him. Additionally, in the event that such termination is on account of our delivery of a notice of non-renewal, Mr. Winoker will be entitled to receive two times the Winoker Target Bonus within 60 days following the date of the Change of Control.
If all or any portion of the payments and benefits would constitute a “parachute payment” within the meaning of Section 280G of the Code (or a similar or successor provision), we will reduce such payments if, by reason of such reduction, the net after-tax benefit to Mr. Winoker will exceed the net after-tax benefit to him if such reduction were not made.
45
Table of Contents
Pay Ratio
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act Item 402(u) of Regulation S-K, the Company is providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Robert Kay, our Chief Executive Officer (our “CEO”) in fiscal 2024:
| • | The median of annual compensation of all employees, excluding the CEO – $47,913 |
| • | The annual total compensation of the CEO in 2024 – $3,907,942 |
| • | The ratio of the CEO’s annual total compensation to the median employee’s compensation – 81.56:1 |
In order to determine the median employee from a compensation perspective, the Company collected cash compensation (salary and cash bonuses) paid in 2024 for all employees worldwide that were compensated during 2024, as of December 31, 2024 (the “determination date”). For those employees compensated in foreign currencies, exchange rates at year-end were used to convert their compensation into U.S. dollars. To determine the ratio disclosed above, the Company calculated the median employee’s compensation for fiscal 2024 in accordance with the rules applicable to the compensation elements included in the Summary Compensation Table and compared such compensation to the compensation of our CEO, Mr. Robert Kay set forth in the Summary Compensation Table.
In making this pay ratio disclosure, other companies may use assumptions, estimates, and methodologies different than ours. As a result, the foregoing information may not be directly comparable to the information provided by other companies in our peer group or otherwise. We believe the pay ratio included above is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.
46
Table of Contents
CEO (1) |
Non-CEO NEOs (2) |
|||||||||||||||||||||||||||
Summary Compensation Table Total |
Compensation Actually Paid (3)(4) |
Average Summary Compensation Table Total |
Average Compensation Actually Paid (3)(4) |
Year-end value of $100 invested on December 31, 2021 |
Net (Loss) Income (in millions) | |||||||||||||||||||||||
Year |
$ |
$ |
$ |
$ |
$ |
$ | ||||||||||||||||||||||
2024 |
( | |||||||||||||||||||||||||||
2023 |
( | |||||||||||||||||||||||||||
2022 |
( |
) |
( | |||||||||||||||||||||||||
| (1) | Amounts reported in the CEO columns reflect (i) the total compensation reported in the Summary Compensation Table for |
| (2) | Non-CEO NEOs columns reflect (i) the average of the total compensation reported in the Summary Compensation Table for Jeffrey Siegel, Daniel Siegel, and Laurence Winoker for each of 2022 and 2023; Daniel Siegel and Laurence Winoker for 2024; and (ii) the average CAP for Jeffrey Siegel, Daniel Siegel, and Laurence Winoker for each of 2022 and 2023; Daniel Siegel and Laurence Winoker for 2024. |
| (3) | To calculate the CAP, adjustments were made to the amounts reported in the Summary Compensation Table for the applicable year. The deductions from, and additions to, total compensation in the Summary Compensation Table by year that were used to calculate CAP include: |
2024 |
2023 |
2022 |
||||||||||||||||||||||||||||||||||
CEO |
Average Non- CEO NEOs |
CEO |
Average Non- CEO NEOs |
CEO |
Average Non- CEO NEOs |
|||||||||||||||||||||||||||||||
Total Compensation from Summary Compensation Table |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||||||||
Adjustments for Equity Awards |
||||||||||||||||||||||||||||||||||||
Adjustment for grant date values in the Summary Compensation Table |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
||||||||||||||||||||||||
Year-end fair value of unvested awards granted in the current year |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||||||||
Year-over-year difference of year-end fair values for unvested awards granted in prior years |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
||||||||||||||||||||||||
Difference in fair values between prior year-end fair values and vest date fair values for awards granted in prior years |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
||||||||||||||||||||||||
Total Adjustments for Equity Awards |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
$ |
( |
||||||||||||||||||||||||
Compensation Actually Paid (as calculated)* |
$ |
$ |
$ |
$ |
$ |
( |
$ |
|||||||||||||||||||||||||||||
| (4) | The equity valuation assumptions used for purposes of calculating CAP are not materially different from the grant date valuation assumptions. |
| • | The NEO’s CAP and the Company’s cumulative total shareholder return (“TSR”); and |
| • | The NEO’s CAP and the Company’s net (loss) income. |
Table of Contents
Proposal No. 2
RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2025
Our Audit Committee appointed the firm of Ernst & Young LLP (“Ernst & Young”) as the independent registered public accounting firm to audit our financial statements for the fiscal year ending December 31, 2025. Ernst & Young has audited our financial statements since 1984.
Our Audit Committee has adopted a policy that requires advance approval of all audit, audit-related and tax services and other services performed by the independent auditor. The policy provides for pre-approval by our Audit Committee of specifically defined audit and non-audit services. Unless the specific service has been previously pre-approved with respect to that year, our Audit Committee must approve the permitted service before the independent auditor is engaged to perform it. Our Audit Committee has delegated to the Chair of the Audit Committee authority to approve permitted services, provided that the Chair reports any decisions to the Audit Committee at its next scheduled meeting.
The following table sets forth fees paid or payable to Ernst & Young for services provided in each of the years ended December 31, 2024 and 2023:
| 2024 | 2023 | |||||||
| Audit fees |
$ | 1,816,933 | $ | 1,791,000 | ||||
| Audit-related fees |
387,100 | 43,000 | ||||||
| Tax fees |
141,435 | 197,982 | ||||||
| All other fees |
— | — | ||||||
| TOTAL |
$ | 2,345,468 | $ | 2,031,982 | ||||
Audit fees
Audit fees are fees paid to Ernst & Young for the annual audit of our financial statements, the quarterly reviews of our financial statements included in our Quarterly Reports on Form 10-Q, fees related to our annual audit of internal controls over financial reporting, statutory audit fees and fees for regulatory filings.
Audit-related fees
Audit-related fees are fees paid to Ernst & Young for assurance and related services that are related to the performance of the audit or review of the financial statements but not reported as audit fees as well as other audit and due diligence procedures in connection with acquisitions or dispositions.
Tax fees
Tax fees are billed for services rendered for tax compliance including the preparation of tax returns and tax advisory services.
All other fees
There were no other fees paid to Ernst & Young in 2024 or 2023.
In making its appointment of Ernst & Young to audit our financial statements for the fiscal year ending December 31, 2025, our Audit Committee reviewed past audit, audit related and other non-audit services performed during 2024. In selecting Ernst & Young, our Audit Committee carefully considered their independence. Our Audit Committee has determined that the performance of such non-audit services did not impair the independence of Ernst & Young.
Ernst & Young has confirmed to our Audit Committee that it is in compliance with all rules, standards and policies of the Public Company Accounting Oversight Board and the SEC governing auditor independence.
Although stockholder approval is not required for the appointment of an independent accounting firm, the Audit Committee and the Board believe that soliciting the Company’s stockholders’ input is a matter of good corporate practice. If the stockholders fail to ratify the selection, it will be considered as a directive to the Audit Committee to consider the appointment of another independent accounting firm for the following year, but the Audit Committee is not required to do
49
Table of Contents
so. Even if stockholders ratify the appointment of Ernst & Young, the Audit Committee retains the right to appoint a different independent registered public accounting firm for fiscal 2025 if it determines that it would be in the Company’s and its stockholders’ best interests.
Representatives of Ernst & Young are expected to be available to respond to appropriate questions of stockholders at the Annual Meeting and will have the opportunity to make a statement at the Annual Meeting if they desire.
Our Board and Audit Committee unanimously recommend that stockholders vote FOR
the ratification of the appointment of Ernst & Young.
50
Table of Contents
AUDIT COMMITTEE REPORT
The Audit Committee of our Board (the “Audit Committee”) reviewed and discussed the consolidated financial statements of the Company and our subsidiaries that are set forth in our 2024 Annual Report to Stockholders and in Item 8 of our 2024 Annual Report with our management and with Ernst & Young LLP, our independent registered public accounting firm.
Our Audit Committee discussed with Ernst & Young LLP the matters required to be discussed by Statement on Auditing Standard No. 1301, Communications with Audit Committees, as amended, which includes, among other items, matters relating to the conduct of an audit of our financial statements and the adequacy of internal controls.
Our Audit Committee received the written disclosures and the letter from Ernst & Young LLP required by Rule 3256 of the Public Company Accounting Oversight Board, Communications Concerning Independence, and discussed with Ernst & Young LLP that firm’s independence from the Company. The Committee concluded that the provision by Ernst & Young LLP of non-audit services, including tax preparation services, to the Company is compatible with its independence.
Based on the review and discussions with our management and with Ernst & Young LLP, referred to above, our Audit Committee recommended to the Board and the Board has approved the inclusion of the audited financial statements in the Company’s 2024 Annual Report.
This report is not soliciting material, is not deemed to be filed with the SEC, and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
The Audit Committee
Michael J. Regan – Chair
Michael Schnabel
Craig Phillips
CERTAIN RELATIONSHIPS
Certain relatives of Jeffrey Siegel, our Chairman of the Board, are employed by us, as follows:
| • | Clifford Siegel, a son of Jeffrey Siegel, is employed by us as our Executive Vice President – Global Supply Chain & Import. His compensation in 2024 included earned cash compensation of $636,327, a grant of 7,500 restricted shares of our common stock with a grant date fair value of $73,200, and a grant of 7,500 performance shares with a grant date fair value of $73,200. |
| • | James Wells, a son-in-law of Jeffrey Siegel, is employed by us as our Executive Vice President and Group President of the Kitchenware Division. His compensation in 2024 included earned cash compensation of $583,056, a grant of 2,750 restricted shares of our common stock with a grant date fair value of $26,840, and a grant of 2,750 performance shares with a grant date fair value of $26,840. |
As previously described, Jeffrey Siegel is also the father of Daniel Siegel, who is an NEO, and a cousin of Craig Phillips, who is a director. Other than these employment relationships, there were no transactions with related persons requiring disclosure pursuant to Item 404 of Regulation S-K.
RELATED-PARTY TRANSACTIONS
Our policies and procedures regarding transactions with related persons are set forth in writing and require that our Audit Committee must review and approve any “related party” transaction, as defined in Item 404(a) of Regulation S-K, before it is consummated. The Audit Committee of our Board is responsible for reviewing such policies and procedures pursuant to its charter, which states that the Audit Committee will review and approve all related-party transactions required to be disclosed according to SEC Regulation S-K Item 404, and discuss with management the business rationale for the transactions and whether appropriate disclosures have been made. We also attempt to identify related party transactions each year by requiring directors and executive officers to complete a questionnaire that provides relevant information to assist in identifying such transactions.
51
Table of Contents
DELINQUENT SECTION 16(A) REPORTS
Section 16(a) of the Exchange Act requires our directors and officers, and persons who own more than 10% of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of any of our equity securities. During 2024, the following persons failed to file a Form 4 on a timely basis:
| • | Daniel Siegel: One transaction occurring on October 4, 2024 was reported late on November 15, 2024. |
| • | Jeffrey Siegel: One transaction occurring on October 4, 2024 was reported late on November 15, 2024. |
Based solely upon a review of copies of such reports filed with the SEC through the date hereof and written representations as to Forms 5 by the Company’s executive officers, directors and 10% stockholders during the year, we believe that, with the exception of the persons named above, all Section 16 filing requirements applicable to our executive officers, directors and 10% stockholders were complied with during 2024.
52
Table of Contents
Proposal No. 3
ADVISORY VOTE ON EXECUTIVE COMPENSATION
Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Company is providing stockholders with an advisory (non-binding) vote on the overall 2024 compensation of the Company’s named executive officers.
As described in detail under the heading “Compensation Discussion and Analysis – Compensation Philosophy and Objectives,” the Company’s compensation program has been designed to attract, reward and retain capable executives and to provide incentives for the attainment of short-term performance objectives and strategic long-term performance goals. A strong link between compensation and performance provides incentives for achieving short-term and long-term financial and business objectives and increasing the value of the Company’s common stock, thereby increasing value to the Company’s stockholders. The Company is committed to tying pay to performance. Reflecting this commitment, the Company’s annual equity compensation program generally consists of a mix of time-based restricted stock awards and performance shares. The performance shares provide an opportunity for shares to be earned at the end of a three-year performance period if pre-established financial goals are met. The Company also uses selected performance measures for the 2024 Annual Bonuses awarded pursuant to the Company’s Amended and Restated 2000 Incentive Bonus Compensation Plan and each executive’s employment agreement. Please read the “Compensation Discussion and Analysis” for additional details about the Company’s executive compensation programs, including information about the fiscal year 2024 compensation of the Company’s named executive officers.
The Board requests stockholders indicate their support of the named executive officers’ compensation as described in this Proxy Statement. This proposal, commonly known as a “say-on-pay” proposal, gives the Company’s stockholders the opportunity to express their views on the Company’s named executive officers’ compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of the named executive officers and the philosophy, policies and practices described in this Proxy Statement. Accordingly, the Board asks its stockholders to vote FOR the following resolution at the Annual Meeting:
“RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2025 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission in accordance with Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, the 2024 Summary Compensation Table and other related tables and disclosures.”
The “say-on-pay” vote is advisory and therefore not binding on the Company, the Compensation Committee or the Board. The Board and Compensation Committee, which is comprised entirely of independent directors, value the opinions of our stockholders and to the extent there are any significant votes against any named executive officer compensation as disclosed in this Proxy Statement, the Board will consider stockholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns. However, neither the Board nor the Compensation Committee will have any obligation to take such actions. The “say-on-pay” vote is proposed annually, and will be on the ballot for the 2026 Annual Meeting of Stockholders.
Our Board of Directors unanimously recommends that stockholders vote FOR the approval of the 2024 compensation of the Company’s named executive officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the SEC.
53
Table of Contents
STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Stockholder Proposals Submitted Pursuant to Rule 14a-8 of the Exchange Act
To be considered for inclusion in next year’s proxy statement and form of proxy pursuant to Rule 14a-8 of the Exchange Act, and acted upon at the 2026 Annual Meeting of Stockholders (the “2026 Annual Meeting”), stockholder proposals must be submitted in writing to the attention of our Corporate Secretary at our principal office no later than December 26, 2025. In order to avoid controversy, stockholders should submit proposals by means (including electronic) that permit them to prove the date of delivery. Such proposals also need to comply with Rule 14a-8 of the Exchange Act and the interpretations thereof, and may be omitted from the Company’s proxy materials for the 2026 Annual Meeting if such proposals are not in compliance with applicable requirements of the Exchange Act.
Director Nominations and Stockholder Proposals Not Submitted Pursuant to Rule 14a-8 of the Exchange Act
Our Amended and Restated Bylaws also establish advance notice procedures with regard to stockholder proposals or director nominations that are not submitted for inclusion in the proxy statement. With respect to such stockholder proposals or director nominations, a stockholder’s advance notice must be made in writing, must meet the requirements set forth in our Amended and Restated Bylaws and must be delivered to, or mailed by first class United States mail, postage prepaid, and received by, our Corporate Secretary at our principal office no earlier than February 18, 2026 and no later than the close of business on March 20, 2026. However, in the event the 2026 Annual Meeting is scheduled to be held on a date before May 19, 2026, or after August 17, 2026, then such advance notice must be received by us not later than the close of business on the later of (1) the ninetieth (90th) calendar day prior to the 2026 Annual Meeting and (2) the tenth (10th) calendar day following the day on which we first make public disclosure of the date of the 2026 Annual Meeting (or if that day is not a business day for the Company, on the next succeeding business day). Stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees under Exchange Act Rule 14a-19 must comply with the notice required under Exchange Act Rules 14a-19.
General Requirements
Each proposal submitted must be a proper subject for stockholder action at the 2026 Annual Meeting, and all proposals and nominations must be submitted to: Corporate Secretary, Lifetime Brands, Inc., 1000 Stewart Avenue, Garden City, New York 11530. The stockholder proponent must appear in person to present the proposal or nomination at the 2026 Annual Meeting or send a qualified representative to present such proposal or nomination. If a stockholder gives notice after the applicable deadlines or otherwise does not satisfy the relevant requirements of Rule 14a-8 of the Exchange Act or our Bylaws, the stockholder will not be permitted to present the proposal or nomination for a vote at the 2026 Annual Meeting.
Discretionary Authority Pursuant to Rule 14a-4(c) of the Exchange Act
If a stockholder who wishes to present a proposal before the 2026 Annual Meeting outside of Rule 14a-8 of the Exchange Act fails to notify us by the required dates indicated above for the receipt of advance notices of stockholder proposals and proposed director nominations, the proxies that our Board solicits for the 2026 Annual Meeting will confer discretionary authority on the person named in the proxy to vote on the stockholder’s proposal if it is properly brought before that meeting subject to compliance with Rule 14a-4(c) of the Exchange Act. If a stockholder makes timely notification, the proxies may still confer discretionary authority to the person named in the proxy under circumstances consistent with the SEC’s proxy rules, including Rule 14a-4(c) of the Exchange Act.
HOUSEHOLDING OF MATERIALS
We, in addition to some banks, brokers, and other nominee record holders participate in the practice of “householding” notices of internet availability of proxy materials, proxy statements and annual reports. This means that only one copy of our Notice, proxy statement or annual report is sent to multiple stockholders in the same household unless we or such bank, broker or other nominee holder have received contrary instructions from one or more of the stockholders. We will promptly deliver a separate copy of these documents to any stockholder upon request by writing the Company at the following address: Lifetime Brands, Inc., 1000 Stewart Avenue, Garden City, New York 11530, Attention: Mr. Laurence Winoker, Executive Vice President, Treasurer and Chief Financial Officer; or by calling us at the following phone number: (516) 683-6000. Any stockholder who wants to receive separate copies of the Notice, annual report and proxy statement in the future, or who is currently receiving multiple copies and would like to receive only one copy for his or her household, should contact his or her bank, broker, or other nominee record holder, or contact us at the above address and phone number.
54
Table of Contents
OTHER MATTERS
Our management does not know of any matters other than those stated in this Proxy Statement which are to be presented for action at the Annual Meeting. If any other matters should properly come before the Annual Meeting, it is intended that proxies in the accompanying form will be voted on such other matters in accordance with the judgment of the persons voting such proxies, subject to compliance with Rule 14a-4(c) of the Exchange Act. Discretionary authority to vote on such matters is conferred by such proxies upon the persons voting them.
Our financial statements are included in our Annual Report for the fiscal year ended December 31, 2024.
Upon the written request of any person who on the record date was a record owner of our common stock, or who represents in good faith that he or she was on such date a beneficial owner of our common stock, we will send to such person, without charge, a copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, including financial statements and schedules, as filed with the SEC. Requests for this report should be directed to Mr. Laurence Winoker, Executive Vice President, Treasurer and Chief Financial Officer, Lifetime Brands, Inc., 1000 Stewart Avenue, Garden City, New York 11530.
| By Order of our Board of Directors, |
| /s/ Sara Shindel |
| Sara Shindel |
| Executive Vice President, General Counsel and Corporate Secretary |
| Dated: April 25, 2025 |
55
Table of Contents
Appendix A
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA:
| Year Ended December 31, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| (in thousands) | ||||||||||||
| Net loss as reported |
$ | (15,165) | $ | (8,412) | $ | (6,166) | ||||||
| Loss on equity securities |
14,152 | — | — | |||||||||
| Equity in losses, net of taxes |
2,092 | 12,665 | 9,467 | |||||||||
| Income tax provision |
3,331 | 6,222 | 5,728 | |||||||||
| Interest expense |
22,208 | 21,728 | 17,205 | |||||||||
| Depreciation and amortization |
22,314 | 19,571 | 19,536 | |||||||||
| Mark to market loss (gain) on interest rate derivatives |
466 | 499 | (1,971) | |||||||||
| Stock compensation expense |
3,920 | 3,687 | 3,846 | |||||||||
| Contingent consideration fair value adjustment |
— | (650) | — | |||||||||
| Gain on extinguishments of debt, net |
— | (761) | — | |||||||||
| Acquisition related expenses |
1,089 | 1,325 | 1,473 | |||||||||
| Restructuring expenses |
— | 856 | 1,420 | |||||||||
| Warehouse relocation and redesign expenses(1) |
964 | 578 | 629 | |||||||||
| Wallace facility remediation expense |
— | — | 5,140 | |||||||||
| S’well integration costs(2) |
— | — | 1,895 | |||||||||
| Adjusted EBITDA, before limitation |
55,371 | 57,308 | 58,202 | |||||||||
| Pro forma projected synergies adjustment(3) |
— | — | 3,590 | |||||||||
| Pro forma adjusted EBITDA, before limitation(5) |
55,371 | 57,308 | 61,792 | |||||||||
| Permitted non-recurring charge limitation(4) |
— | — | (3,589) | |||||||||
| Adjusted EBITDA(5) |
$ | 55,371 | $ | 57,308 | $ | 58,203 | ||||||
(1) For the year ended December 31, 2024 and December 31, 2023, the warehouse redesign expenses related to the U.S. segment. For the year ended December 31, 2022, warehouse relocation and redesign expenses included $0.5 million of expenses related to the International segment and $0.1 million of expenses related to the U.S. segment.
(2) For the year ended December 31, 2022, S’well integration costs included $0.5 million of expenses related to inventory step up adjustment in connection with S’well acquisition.
(3) Pro forma projected synergies represents the projected cost savings of $2.3 million associated with the reorganization of the International segment’s workforce, $0.9 million associated with the Executive Chairman’s cessation of service in such role, and $0.4 million associated with reorganization of the U.S. segment’s sales management structure.
(4) Permitted non-recurring charges include restructuring expenses, integration charges, Wallace facility remediation expense, and warehouse relocation and redesign expenses. These are permitted exclusions from the Company’s Adjusted EBITDA, subject to limitations, pursuant to the Company’s Debt Agreements.
(5) Adjusted EBITDA is a non-GAAP financial measure which is defined in the Company’s debt agreements. Adjusted EBITDA is defined as net loss, adjusted to exclude loss on equity securities, equity in losses, net of taxes, income tax provision, interest expense, depreciation and amortization, mark to market loss (gain) on interest rate derivatives, stock compensation expense, gain on extinguishments of debt, net, and other items detailed in the table above that are consistent with exclusions permitted by our debt agreements.
A-1
Table of Contents
Adjusted net income (in thousands):
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Net loss as reported |
$ | (15,165) | $ | (8,412 | ) | |||
| Adjustments: |
||||||||
| Acquisition intangible amortization expense |
15,589 | 14,835 | ||||||
| Contingent consideration fair value adjustments |
— | (650) | ||||||
| Gain on extinguishments of debt, net |
— | (761) | ||||||
| Acquisition related expenses |
1,089 | 1,325 | ||||||
| Restructuring expenses |
— | 856 | ||||||
| Warehouse redesign expenses(1) |
964 | 578 | ||||||
| Impairment of Grupo Vasconia investment |
— | 6,834 | ||||||
| Mark to market loss on interest rate derivatives |
466 | 499 | ||||||
| Loss on equity securities |
14,152 | — | ||||||
| Income tax effect on adjustments |
(4,452) | (4,094) | ||||||
| Adjusted net income(2) |
$ | 12,643 | $ | 11,010 | ||||
(1) For the year ended December 31, 2024 and December 31, 2023, the warehouse redesign expenses were related to the U.S. segment.
(2) Adjusted net income in the year ended December 31, 2024, excludes acquisition intangible amortization expenses, acquisition related expenses, warehouse redesign expenses, mark to market loss on interest rate derivatives, and loss on equity securities. The income tax effect on adjustments reflects the statutory tax rates applied on the adjustments.
Adjusted net income in the year ended December 31, 2023, excludes acquisition intangible amortization expense, contingent consideration fair value adjustments, gain on extinguishments of debt, net, acquisition related expenses, restructuring expenses, warehouse redesign expenses, impairment of Grupo Vasconia investment, and mark to market loss on interest rate derivatives. The income tax effect on adjustments reflects the statutory tax rates applied on the adjustments.
Adjusted income from operations (in thousands):
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Income from operations |
$ | 27,084 | $ | 31,941 | ||||
| Adjustments: |
||||||||
| Acquisition intangible amortization expense |
15,589 | 14,835 | ||||||
| Contingent consideration fair value adjustments |
— | (650 | ) | |||||
| Acquisition related expenses |
1,089 | 1,325 | ||||||
| Restructuring expenses |
— | 856 | ||||||
| Warehouse redesign expenses(1) |
964 | 578 | ||||||
| Total adjustments |
17,642 | 16,944 | ||||||
| Adjusted income from operations(2) |
$ | 44,726 | $ | 48,885 | ||||
(1) For the year ended December 31, 2024 and December 31, 2023, the warehouse redesign expenses were related to the U.S. segment.
(2) Adjusted income from operations for the year ended December 31, 2024 and December 31, 2023, excludes acquisition intangible amortization expenses, contingent consideration fair value adjustments, acquisition related expenses, restructuring expenses, and warehouse redesign expenses.
A-2
Table of Contents
ENDORSEMENT_LINE SACKPACK MR A SAMPLE DESIGNATION (IF ANY) ADD 1 000001 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6 C123456789 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext Your vote matters – here’s how to vote! You may vote online or by phone instead of mailing this card. Online Go to www.envisionreports.com/LCUT or scan the QR code — login details are located in the shaded bar below. Phone Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for electronic delivery at www.envisionreports.com/LCUT Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. Annual Meeting Proxy Card 1234 5678 9012 345 IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. A Proposals — The Board of Directors recommend a vote FOR all nominees for director and FOR Proposals 2 and 3. 1. ELECTION OF DIRECTORS For Against Abstain For Against Abstain For Against Abstain 01 - Jeffrey Siegel 02 - Robert B. Kay 03 - Jeffrey H. Evans 04 - Rachael A. Jarosh 05 - Cherrie Nanninga 06 - Craig Phillips 07 - Veronique Gabai-Pinsky 08 - Bruce G. Pollack 09 - Michael J. Regan 10 - Michael Schnabel 2. TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP AS THE For Against Abstain 3. TO APPROVE, ON A NON-BINDING ADVISORY BASIS, THE 2024 For Against Abstain INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM OF THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS. COMPANY FOR THE FISCAL YEAR ENDING DECEMBER 31, 2025. B Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below (Please sign proxy as name appears on corporate records. Joint owners should each sign personally. Trustees and others signing in a representative capacity should indicate the capacity in which they sign.) Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. C 1234567890 J N T MR A SAMPLE (THIS AREA IS SET UP TO ACCOMMODATE 140 CHARACTERS) MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND 1 UPX 651634 MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND 04518B
Table of Contents
The 2025 Annual Meeting of Stockholders of Lifetime Brands, Inc. will be held on Wednesday, June 18, 2025 at 10:30 a.m., Eastern Time, virtually via the internet at meetnow.global/MPQPCDJ. To access the virtual meeting, you must have the information that is printed in the shaded bar located on the reverse side of this form. Proxy materials for the Annual Meeting of Stockholders are available at: www.envisionreports.com/LCUT Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.envisionreports.com/LCUT IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. Proxy — LIFETIME BRANDS, INC. This Proxy is solicited on behalf of the Board of Directors Jeffrey Siegel and Robert B. Kay, and each of them, are hereby constituted and appointed the lawful attorneys and proxies of the undersigned, with full power of substitution to vote and otherwise act on behalf of the undersigned with all powers that the undersigned would have if personally present at the 2025 Annual Meeting, with respect to all shares of common stock, $0.01 par value, of LIFETIME BRANDS, INC. (the “Company”) standing in the name of the undersigned on the Company’s books at the close of business on April 22, 2025, at the Annual Meeting of Stockholders to be held virtually via the Internet at 10:30 a.m., Eastern Time, on June 18, 2025 or at any adjournment(s) or postponement(s) thereof (the “2025 Annual Meeting”), as directed on the reverse side. The undersigned acknowledges receipt of the Notice of the Annual Meeting and Proxy Statement. The powers hereby granted may be exercised by any of said attorneys or proxies or their substitutes present and acting at the above-described 2025 Annual Meeting or any adjournment(s) or postponement(s) thereof. The undersigned hereby revokes any and all proxies heretofore given by the undersigned to vote at said meeting. The proxy holder is authorized to act, in accordance with his or her discretion, upon all matters incident to the conduct of the meeting and upon other matters that properly come before the 2025 Annual Meeting, subject to compliance with Rule 14a-4(c) of the Securities Exchange Act of 1934, as amended. This proxy when properly executed will be voted in the manner directed herein. If no direction is made with respect to any proposal, this proxy will be voted FOR all nominees listed in Proposal 1 and FOR Proposals 2 and 3. (Continued and to be signed on reverse side.) C Non-Voting Items Change of Address — Please print new address below. Comments — Please print your comments below.