DEF 14A of Zumiez Inc, Apr 23, 2025

DEF 14A of Zumiez Inc

Filed Apr 23, 2025 · FY20240000950170-25-057318

Open on EDGAR

  1. Board Composition and Consideration of Director Nominees

    Board Composition and Consideration of Director Nominees

  2. Director Qualifications and Membership Criteria

    Director Qualifications and Membership Criteria The board of directors believes that it is necessary for each of the Company’s directors to possess many qualities and skills and the composition of our board of directors has been designed to allow for expertise in differing skill sets. Furthermore, as discussed previously, a majority of our board of directors must qualify as “independent” as required under Nasdaq listing rules. The governance and nominating committee is responsible for assisting the board in matters of board organization and composition and in establishing criteria for board membership. The criteria for evaluation of a director candidate includes, as a baseline or prerequisite to further review, that a candidate possesses all of the following characteristics: • Integrity; • Absence of any conflicts of interest; • Appreciation for the role of culture in an organization and an ability to participate in a constructive and collegial manner; • Business understanding and financial acumen; and • Willingness to devote sufficient time to carrying out the duties and responsibilities of a director, and, most importantly, to represent the long-term interests of all shareholders. In further evaluating the suitability of individual board members, the governance and nominating committee considers many factors, with a focus on Diversity, Industry or Related Experience and Specialty Skills and Knowledge. For these purposes, “Diversity” includes: age, gender, ethnicity, sexual orientation, national origin, or other professional backgrounds and experiences. “Industry or Related Experience” can be exhibited by: retail industry experience, experience operating businesses at scale or being a leader within a niche, brand experience, lifestyle retail experience or fashion experience. “Specialty Skills and Knowledge” can be exhibited by the following skills or knowledge: executive leadership, business development or M&A, financial, accounting (e.g., CFO or CPA experience) or investor relations, ecommerce, omnichannel, technology, global/international, governance, consumer/digital insights, organizational development, corporate social responsibility, platform services or concepts or innovation within the consumer world. These criteria are also referenced in our Corporate Governance Guidelines and in Exhibit A to the governance and nominating committee’s charter, both available at http://ir.zumiez.com under the “Governance” section. The governance and nominating committee also has the ability to review and add other criteria, from time to time, that it deems relevant. Specific weights are not assigned to particular criteria and no particular criterion is necessarily applicable to all prospective nominees. The governance and nominating committee assesses the skill areas currently represented on the board and those skill areas represented by directors expected to retire from the board in the near future against the list of targeted skills and experiences. The governance and nominating committee also considers recommendations from members of the board regarding skills that could improve the overall quality and ability of the board to carry out its function. Based on this analysis, the governance and nominating committee targets specific skill areas or experiences as the focus of consideration for new directors to join the board.

  3. Identifying and Evaluating Nominees for Directors

    Identifying and Evaluating Nominees for Directors The governance and nominating committee will evaluate all of the aforementioned skills and qualifications based on established prioritizations that are consistent with the Company’s long-term vision and strategies and the needs of the board in general. The committee will also consider the needs of the board with respect to director succession and the capacity of a director to serve on board committees and/or to possibly serve as a chairperson of a board committee. In the event vacancies are anticipated, or arise, the committee evaluates various potential candidates for director, considering the skill areas and characteristics discussed above and qualifications of the individual candidate. Candidates may come to the attention of the committee through current board members, third-party search firms retained to assist in identifying and evaluating possible candidates, shareholders or other persons. In determining whether to recommend a director for re-election, the committee will also consider the director’s past attendance at meetings, participation in and contributions to the activities of the board, and the results of the annual board evaluation and self-assessment. As part of its review process the governance and nominating committee will interview potential director candidates, conduct reference and background checks and review completed independence and conflict of interest questionnaires and follow other customer procedures.

  4. Information Regarding the Board of Directors and its Committees

    Information Regarding the Board of Directors and its Committees Our board has established an audit committee, compensation committee and governance and nominating committee. The board has adopted a written charter for each committee. The charters of these three committees are posted on the Company’s website and can be accessed free of charge at http://ir.zumiez.com and are available in print to any shareholder who requests them. The composition of our board committees complies with the applicable rules of the SEC and Nasdaq. The board has determined that Steven P. Louden is an audit committee financial expert as defined in the rules of the SEC. The following table displays the composition of our board of director committee assignments as of February 1, 2025:

  5. Information Regarding the Board of Directors and its Committees

    | | Audit Committee | Governance & Nominating Committee | Compensation Committee | | Travis D. Smith | | | | | Steven P. Louden | | | | | Carmen R. Bauza | | | | | Scott A. Bailey | | | | | Liliana Gil Valletta | | | | | James P. Murphy | | | | | Guy M. Harkless | | | |

  6. Information Regarding the Board of Directors and its Committees

    | Chairperson | Member | Lead Independent Director | Audit Committee Financial Expert |

  7. Information Regarding the Board of Directors and its Committees

    Audit Committee As more fully described in its charter, our audit committee has responsibility for, among other things: • the sole authority to appoint, determine the funding for and oversee the independent registered public accounting firm; • assisting our board in monitoring the integrity of our financial statements and other SEC filings; discussing with our management and our independent registered public accounting firm significant financial reporting issues and judgments and any major issues as to the adequacy of our internal controls; reviewing our annual and quarterly financial statements prior to their filing with the SEC and prior to the release of our results of operations; reviewing the independence, performance and qualifications of our independent registered public accounting firm and presenting its conclusions to our board and approving, subject to permitted exceptions, any non-audit services proposed to be performed by the independent registered public accounting firm; • reviewing and discussing with management the Company’s major operational, legal and regulatory risks, including data security and privacy and the Company’s policies and procedures to identify and manage cybersecurity risks; • reviewing and approving any changes to the Company’s insider trading compliance program and procedures; • oversight of the performance of the Company’s internal audit function; and • reviewing its charter at least annually for appropriate revisions. The audit committee has the power to investigate any matter brought to its attention within the scope of its duties and to retain counsel for this purpose where appropriate. Governance and Nominating Committee As more fully described in its charter, our governance and nominating committee has the responsibility for, among other things: • recommending persons to be selected by the board as nominees for election as directors and as chief executive officer; • assessing our directors’ and our board’s performance; • making recommendations to the board regarding membership and the appointment of chairpersons of the board’s committees; • recommending director compensation and benefits policies; • reviewing its charter at least annually for appropriate revisions; and • recommending to the board other actions related to corporate governance principles and policies. Compensation Committee As more fully described in its charter, our compensation committee has responsibility for, among other things: • establishing the Company’s philosophy, policies and strategy relative to executive compensation, including the mix of base salary, short-term and long-term incentive and equity based compensation within the context of the stated policies and philosophy including management development and succession planning practices and strategies; • reviewing corporate goals and objectives relevant to compensation of our CEO and other senior executives including review and approval of performance measures and targets for all executive officers participating in the annual executive non-equity incentive bonus plan and certify achievement of performance goals after the annual measurement period to permit bonus payouts under the plan; • determining and approving our CEO’s compensation and making recommendations to the board with respect to compensation of other executive employees, including any special discretionary compensation and benefits; administering our incentive compensation plans and equity based plans and making recommendations to the board with respect to those plans; making recommendations to our board with respect to the compensation of directors; the sole authority to appoint, determine the funding for and oversee the independent compensation consultant; and • reviewing its charter at least annually for appropriate revisions.

  8. Election Of Directors

    Election Of Directors

  9. Nominees for Election for Terms Expiring in 2028

    Nominees for Election for Terms Expiring in 2028 The Company currently has nine director positions, and will have eight director positions immediately following the 2025 annual meeting of shareholders. The directors are divided into three classes so that approximately one-third of the directors are elected each year for three-year terms. The Company believes that a classified board promotes continuity of experience and an orderly succession of directors, which, in turn, increases the stability of the Company and encourages a long-term corporate perspective. Directors are elected to hold office until their successors are elected and qualified, or until resignation or removal in the manner provided in our bylaws. Two directors are nominees for election this year and each has consented to serve a three-year term ending in 2028. One director who has a term expiring in 2025 will not be seeking re-election for another three-year term. The remaining directors will continue to serve the terms set out below in the sections entitled “Continuing Directors Whose Terms Expire in 2026” and “Continuing Directors Whose Terms Expire in 2027.” Travis D. Smith, 52, was appointed to our board of directors in August 2012. Mr. Smith served as the Chief Executive Officer of Electronic Auction Services, Inc, a division of Health Trust, a leading group purchasing organization and supply chain performance company for healthcare, from April 2016 through January 2024. He also served on their Board of Directors during this time frame. Prior to his employment with Electronic Auction Services, Inc., he was the CEO and President of Jo-Ann Fabric and Craft stores from August 2011 until August 2014. Mr. Smith began his career with Jo-Ann in 2006 serving as the Executive Vice President, Merchandising and Marketing. In February 2009, Mr. Smith was named Chief Operating Officer and added the duties of President in February 2010, then Chief Executive Officer in August 2011. Prior to his employment with Jo-Ann, Mr. Smith held merchandising and marketing positions of increasing responsibility with Fred Meyer Stores, a division of the Kroger Company, ultimately serving as Senior Vice President, General Merchandise. Mr. Smith has also served on the Board of Directors of Pendleton Woolen Mills since February of 2016. Mr. Smith is a graduate of the University of Notre Dame with a Bachelor’s Degree in Business Marketing and Communications. Director Qualifications: Mr. Smith’s background in retailing and in particular merchandising, marketing and leadership roles adds important and relevant experience to the Company’s board of directors. Mr. Smith also brings experience in brand building, retail brick and mortar and direct to customer operations. Guy M. Harkless, 56, was appointed to our board in July 2023. From October 2023 through February 2025, Mr. Harkless had been the President & CEO of Blink Fitness, a premium quality, value-based fitness brand headquartered in New York, New York. Mr. Harkless was hired by Equinox Holdings in October 2023 to lead the restructuring and sale of Blink Fitness. In connection with this process, Blink Fitness voluntarily filed a bankruptcy proceeding under Chapter 11 of the U.S. Bankruptcy Code on August 12, 2024 in the U.S. Bankruptcy Court for the District of Delaware. The U.S. Bankruptcy Court ultimately approved the sale of Blink Fitness’s Chicago, Illinois and California locations to JTRE Holdings LLC and its corporate and New York and New Jersey operations to Pinnacle US Holdings in November 2024. Mr. Harkless continued to serve as the CEO of Blink Fitness and in support of the integration of the Blink Fitness assets that were sold to Pinnacle US Holdings until February 27, 2025. From August 2015 to April 2023 Mr. Harkless served in an Executive level leadership capacity with Foot Locker Inc., in operating and strategy roles. Most recently, from July 2020 to April 2023, Mr. Harkless led the North American operations as Senior Vice President and General Manager of the Champs Sports division, following roles leading Foot Locker’s Canadian subsidiary from October 2017 to June 2020 and as the Global head of corporate strategy from August 2015 to September 2017. Mr. Harkless has held commercial leadership, category and operational roles for industry leading athletic apparel and footwear brands, Nike, Inc. and Puma SE, including leading Puma’s subsidiary for the Benelux countries of the Netherlands, Belgium and Luxembourg from January 2011 to January 2014. Prior to these roles, Mr. Harkless was a founding partner and a member of the executive team of AND 1 Basketball, a basketball performance and lifestyle brand, including leading the international expansion for the European and Asia-Pacific regions and he led, with the management team, the sale of AND 1 to American Sporting Goods in 2005. Mr. Harkless holds a BA in Political Science from Howard University, graduating Magna Cum Laude. Director Qualifications: Mr. Harkless brings multi-segment, specialty retail, brand, and leadership experience to the Company’s board of directors. He also has significant experience in international operations, market development, and retail & consumer strategy in lifestyle and youth culture which will provide relevant experience to Zumiez in its international operations, competitive, consumer and growth strategies and initiatives. Mr. Harkless also contributes to governance matters after serving on the boards of Blink Fitness and AND 1 Basketball and with his direct engagement as a member of the Foot Locker executive team.

  10. The Board Of Directors Recommends A Vote For the Election of Each Nominee Previously Named

    The Board Of Directors Recommends A Vote For the Election of Each Nominee Previously Named

  11. Directors With Term Expiring in 2025

    Directors With Term Expiring in 2025 Scott A. Bailey, 61, was appointed to our board in February 2016. Mr. Bailey is CEO of Path Projects, a running apparel company that he founded in 2017 that sells shorts, shirts, hats and base layers designed for runners directly to consumers. From 2002 to 2015 Mr. Bailey was the CEO and co-founder of One Distribution Company, a leading skate-inspired apparel and footwear company whose brands included KR3W Denim and SUPRA Footwear. KR3W is a lifestyle brand born out of the skateboard culture on the streets of Southern California in 2003 and is known for its denim apparel and SUPRA was launched in 2006 as a premium footwear brand known for its premium high top sneakers. Prior to One Distribution, Mr. Bailey was the co-founder of Split Inc., a youth culture men’s and women’s apparel brand founded in the early 1990s. Mr. Bailey is also a general partner in Overlook Point LLC, a residential and commercial land development company established in 2022. Mr. Bailey’s term will end on June 4, 2025 and he will not seek re-election for another term. Director Qualifications: Mr. Bailey brings a unique brand and vendor perspective to the Company’s board of directors. He has had over a 26 year career as a co-founder and CEO of influential brands in the apparel and footwear space and his experience in growing and building brands both domestically and internationally will be beneficial to the board of directors in an ever changing consumer environment. Also, his understanding of the youth lifestyle customer is also very valuable to the Company.

  12. Continuing Directors Whose Terms Expire in 2026

    Continuing Directors Whose Terms Expire in 2026 Thomas D. Campion, 76, is one of our co-founders and has served on our board of directors since our inception in 1978. Mr. Campion has held various senior management positions during this time, including serving as our Chairman since June 2000. From November 1970 until August 1978, he held various management positions with JC Penney Company. Mr. Campion holds a B.A. in Political Science from Seattle University. He is the trustee of the Campion Foundation, a nonprofit organization focused on ensuring that biologically important ecosystems in Northwestern North America are preserved. The Campion Foundation also works on homelessness issues in the Pacific Northwest. He is also a trustee of the Campion Advocacy Fund, a 501(c)(4) organization that was founded to support and strengthen efforts to end homelessness in the U.S. and protect wilderness in western North America through direct advocacy and political engagement. Director Qualifications: Mr. Campion’s knowledge as a retailer and as the co-founder of the Company provides the board with invaluable insight into the Company’s business and its unique culture. Mr. Campion provides generational leadership, sales, marketing, merchandising and brand building experience and expertise. Mr. Campion’s particular knowledge and experience with Zumiez and its competition helps the Company formulate short and long-term strategies that have contributed to Zumiez differentiating itself in the specialty niche of lifestyle retailing. As one of the Company’s largest shareholders, Mr. Campion’s interests are aligned with other Zumiez shareholders’ interests to increase the long-term value of the Company. Liliana Gil Valletta, 48, was appointed to our board in July 2019. Ms. Gil Valletta is the co-founder and CEO of Cien+ (since 2010) and Culturintel (since 2018), both of which are based in New York City and have offices throughout the U.S. and Latin America and Europe. In 2023, these firms expanded globally under the holding Culture+ Group. Cien+ and Culturintel, collectively provide business consulting, big-data analytics, and marketing solutions for companies to help successfully turn demographic and cultural trends into opportunities for business success. Previously, Ms. Gil Valletta held a variety of marketing and supply chain roles at Johnson & Johnson, including serving as Global Marketing Services Director overseeing global strategy and agency contracting for the U.S. and EMEA regions. Ms. Gil Valletta also presently serves as an Operating Executive Board Member of AUA Private Equity Partners, a private equity firm that focuses on family-owned businesses benefiting from the growth of the U.S. Hispanic population. Additionally, Ms. Gil Valletta serves on the Board of Directors of RCN TV, a global studios and television network based in Columbia and Latin America. She also serves on the operating board of AUA Private Equity Partners and is the Chair of the Board of the Friends of the National Museum of the American Latino. Ms. Gil Valletta earned an M.B.A. from the University of Colorado at Colorado Springs, an executive degree in Global Leadership and Public Policy from The Harvard Kennedy School at Harvard University and a B.A. in Business Administration from Southwestern Adventist University. Director Qualifications: Ms. Gil Valletta’s extensive experience in marketing and understanding and connecting with consumers from a cultural perspective provides unique insight to the Company’s board of directors. She has experience in AI powered market research and data analytics and has worked with the C-Suite of Fortune 100 companies to redefine growth roadmaps tapping into shifting demographics. Her insights and perspective in these areas are valuable to the Company in helping it understand its diverse customer base. She also brings experience in operating an international business and also provides a diverse perspective in her discussions and deliberations with the Company’s board of directors. Carmen R. Bauza, 63, was appointed to our board in May 2022. Ms. Bauza currently serves as a member of the board of directors of Destination XL Group, Inc., where she serves on the Nominating and Corporate Governance Committee and the Cybersecurity and Data Privacy Committee. She is a member of the board of directors of OneWater Marine, where she serves on the Audit and Compensation Committees. She also is a member of the board of managers of Claire’s Holdings LLC, where she serves on the Nominating and ESG Committee. Previously Ms. Bauza served as the Chief Merchandising Officer at Fanatics, Inc. from January 2019 until April 2021. Prior to that, she was the Chief Merchandising Officer at HSN from November 2016 until December 2017 and the Senior Vice President, General Merchandise Manager Consumables, Health and Wellness at Walmart from June 2007 to October 2016. She previously held roles at Bath & Body Works, Five Below and The Walt Disney Company. Ms. Bauza currently serves as a member of the board of trustees at Seton Hill University and as an Advisor to RoundTable Healthcare Partners. She previously served as a Director of Walmart of Mexico, the National Association of Chain Drug Stores, the Network of Executive Women and the Literacy Council of Benton County. Ms. Bauza holds a BS in Fashion Merchandising and Business from Seton Hill University. Director Qualification: Ms. Bauza. Ms. Bauza’s extensive experience in retail, merchandising and leadership make her a valuable member of our board of directors.

  13. Continuing Directors Whose Terms Expire in 2027

    Continuing Directors Whose Terms Expire in 2027 Richard M. Brooks, 65, has served as our CEO since June 2000. From August 1993 through June 2000, he served as a Vice President and our Chief Financial Officer. From November 1989 until February 1992, Mr. Brooks was with Interchecks, Inc., a subsidiary of Bowater PLC, as a finance officer. Mr. Brooks was with Deloitte, Haskins & Sells, currently known as Deloitte LLP, from July 1982 to March 1989. Mr. Brooks holds a B.A. in Business from the University of Puget Sound. Mr. Brooks serves on the Board of Directors of Stance, Inc. and is a trustee of the Brooks Foundation, a non-profit organization. Director Qualifications: Mr. Brooks’ day to day leadership as our CEO provides him with detailed knowledge of our business and operations. Mr. Brooks provides generational leadership, sales, marketing, merchandising and brand building experience and expertise. Mr. Brooks has demonstrated a record of innovation, achievement and leadership. This experience provides the board with a unique perspective into the operations and vision of Zumiez. Mr. Brooks’ particular knowledge and experience with Zumiez and its competition helps the Company formulate short and long-term strategies that have helped Zumiez differentiate itself in the specialty niche of lifestyle retailing. As one of the Company’s largest shareholders, Mr. Brooks’ interest is aligned with other Zumiez shareholders’ interests to increase the long-term value of the Company. Steven P. Louden, age 53, served as the Chief Financial Officer of Roku, Inc., from June 2015 until May 2023. From May 2009 to June 2015, Mr. Louden served in various capacities at Expedia, Inc., an Internet travel company, including as its Vice President, Corporate Finance and most recently serving as its Treasurer. Prior to joining Expedia, Mr. Louden has also previously held finance, strategy and planning roles at Washington Mutual, Inc., McKinsey & Company and the Walt Disney Company, and began his career as a financial analyst with Merrill Lynch and Co., Inc. Mr. Louden holds a B.A. in Economics and Mathematics from Claremont McKenna College and an M.B.A. from Harvard Business School. Director Qualifications: Mr. Louden brings financial expertise to the Company’s board of directors as well as leadership strategic development experience and experience with digital and media streaming businesses. James P. Murphy, 72, was appointed to our board in January 2021 and he served as the EVP, COO of Costco Wholesale’s International Division until November 2022 where he had been responsible for directing the expansion and operations of Costco’s businesses outside of North America since 2004 and was a member of Costco’s executive committee. Prior to his position as EVP, COO he held a variety of leadership roles including SVP - International, SVP - Europe, SVP - Northeast Region and VP Operations - Northern California. Prior to joining Costco in 1987 he worked for Lucky Stores in a variety of operational roles beginning in 1971. Mr. Murphy currently serves on the non-profit board of the College Success Foundation, where he serves as Vice-Chair. Mr. Murphy earned a M.B.A. from the University of Portland and a B.S. in Business Administration from the University of Southern California. Director Qualifications: Mr. Murphy’s background as an executive leader with a leading global retailer brings relevant leadership and retail experience to Zumiez. His deep experience in international retail operations around the globe provides Zumiez with insight into international operations and strategies as Zumiez continues to grow its operations around the world.

  14. Director Compensation

    Director Compensation The goal of our director compensation is to help attract, retain and reward our non-employee directors and align their interests with those of the shareholders. Our desired goal for total director compensation (cash and equity) is to be at the 50th percentile of comparable companies based on our compensation consultant’s competitive survey results. The Company pays its non-employee directors an annual fee for their services as members of the board of directors. Each non-employee director receives an annual cash retainer of $70,000 and the lead independent director receives an additional $35,000. The audit committee chairperson receives an additional $25,400 per year, the compensation committee chairperson receives an additional $19,000 per year and the governance & nominating committee chairperson receives an additional $16,500. Directors appointed in an interim period receive pro-rata retainer fees based on the number of meetings they attend between annual shareholder meetings. The committee chairperson and the respective committee members are paid rates commensurate with the duties and responsibilities inherent within the position held. Additionally, the Company issues restricted stock awards to its non-employee directors. The board believes such awards provide alignment with the interests of our shareholders. Directors appointed in an interim period receive pro-rata restricted stock awards based on the number of meetings they attend between annual shareholder meetings. The Company reimburses all directors for reasonable expenses incurred to attend meetings of the board of directors. Non-employee directors may elect to have a portion, or all, of their annual retainer be used for the reimbursement of travel expenses in excess of those that the Company considers to be reasonable. The following table discloses the cash paid and stock awards earned by each of the Company’s non-employee directors during the fiscal year ending February 1, 2025:

  15. Director Compensation

    | | Fees Earned or Paid in Cash | Stock Awards (1) (2) | Total | | Name | ($) | ($) | ($) | | Travis D. Smith | 105,000 | 90,000 | 195,000 | | Steven P. Louden | 95,400 | 90,000 | 185,400 | | Scott A. Bailey (3) | 89,000 | 90,000 | 179,000 | | Liliana Gil Valletta | 86,500 | 90,000 | 176,500 | | Carmen R. Bauza | 70,000 | 90,000 | 160,000 | | James P. Murphy | 70,000 | 90,000 | 160,000 | | Guy M. Harkless | 70,000 | 90,000 | 160,000 |

  16. Director Compensation

    This column represents the aggregate grant-date fair value of restricted stock awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2024 Form 10-K. (2) On June 5, 2024, the day of the annual shareholder meeting, the Company awarded 4,655 shares of restricted stock to each of the current non-employee directors as part of their annual compensation and was based upon a dollar amount award of $90,000. Scott A. Bailey’s term will end on June 4, 2025 and he will not seek re-election for another term.

  17. Compensation Goals and Strategy for NEOs

    Gain-based awards have widespread use and have upside potential that can be highly motivational. However, the compensation committee: (i) is aware that gain-based awards have a different downside potential than that of holding outright shares of stock; (ii) recognizes that the exclusive and substantial use of gain-based awards has been historically noted by the investment community as a potential contributor to misguided or unacceptable decisions on the part of executives in certain other companies; and, (iii) knows that historic accounting advantages for the use of gain-based awards no longer exist. In addition, the compensation committee is aware of the executive compensation trend among publicly-held companies to utilize less gain-based awards in favor of full-value awards such as restricted stock. Therefore, the compensation committee continues to review and has deployed full-value restricted stock awards to help offset and balance the disadvantages of gain-based awards for achieving pay-for-performance and other compensation goals while retaining the advantages of gain-based awards. The mix of gain-based awards and full-value awards is evaluated annually by the compensation committee and adjusted based on input from the compensation consultant and the CEO, all in the context of the marketplace, our compensation philosophy, and what the compensation committee believes is in the best interest of the shareholders and the NEOs. The compensation committee also allows some deference to the CEO in the allocation between stock options and restricted stock, so long as the total compensation charge to Zumiez is equal to what was approved by the compensation committee. Executive Officer Continuity. Undesirable, unanticipated or untimely departure of an executive officer is a risk to the Company that the compensation committee works to avoid. The risk stems from the potentially high costs of recruiting, relocation, operational disruption, reduced morale, turnover ripple effects among staff, negative external perceptions, reduced external confidence and lost intellectual capital. The compensation committee encourages executive officer continuity by granting stock awards to a NEO where the ultimate realization of value not only depends on stock price, but also on the NEO remaining with Zumiez for many years. Accordingly, if a NEO were to depart from Zumiez then he or she could forfeit substantial amounts of unrealized compensation. Shareholder Mentality. We believe it is in the best interests of shareholders for our leaders to feel, think and act like shareholders, and to have a “shareholder mentality” as they go about envisioning, planning for and executing operations. The compensation committee seeks to cultivate NEOs with a shareholder mentality by having NEOs receive, accumulate and maintain significant ownership positions in Zumiez through annual equity grants. We do not believe it is necessary to establish share ownership or share holding requirements because historically the NEOs on aggregate have held a substantial amount of equity and, from a cultural point of view, NEOs are empowered to make decisions on their equity holdings taking into account their personal values, temperament, risk tolerance and personal finances. Within this concept, through equity awards granted over time, each of our NEOs has the ability to establish and maintain a valuable ownership in Zumiez.

  18. Summary of the Elements of NEO Compensation

    Summary of the Elements of NEO Compensation The compensation committee utilizes five primary elements for compensating NEOs: • Base Salary • Non-Equity Incentive Plan Compensation (“short-term cash based incentives”) • Bonus • Stock Option Grants • Restricted Stock Grants Total Pay Philosophy—Our “Total Pay” compensation philosophy is designed to recognize and reward the contributions of all employees, including executives, in achieving our strategic goals and business objectives, while aligning our compensation program with shareholder interests. We regularly assess our total pay package, and we adjust it as appropriate to remain competitive and to enable us to attract and retain our NEOs. We believe our total pay practices motivate our executives to build long-term shareholder value. Base Salary is a pre-set fixed cash amount that is delivered regularly in equal portions through the year. Each NEOs annual base salary rate is reviewed from time to time and at least annually by the compensation committee. Outside of the CEO, the review is based on recommendations of the CEO. Short-Term Cash Based Incentives are based on pre-set opportunities for cash awards to be paid after the end of the year based on performance for the year. Actual payouts may be between zero and up to 120% to 250% of the target amount (depending on the NEO), where the target amount is that established for each NEO by the compensation committee if target goals are achieved. Bonuses may be awarded from time to time in order to attract and retain key NEOs. These bonuses, when awarded, are generally in addition to those earned from participating in short-term cash based incentives and are considered in the executive’s total direct compensation. The intention is to pay such bonuses rarely and in modest amounts if and only if other elements of the executive pay system do not respond to outstanding achievements clearly pursued and delivered in the interests of shareholders. Stock Option Grants are opportunities granted from time to time (usually annually or at the time of hiring) to an NEO to purchase our common stock at some future time at a pre-established fixed price set at the time of grant. This price is the actual market price of the stock at the time of grant. The right to exercise options in a particular grant is accumulated over a number of years, and is subject to vesting based upon continued employment with us. Restricted Stock Grants are awards of common voting shares of stock that are granted from time to time (usually annually or at the time of hiring) to each NEO. The right to earn the stock is contingent upon continued employment over a period of time. The compensation committee views the elements of total direct compensation for NEOs as an integrated package to achieve all of the compensation goals described in the immediately preceding section of this discussion.

  19. Short-Term Cash Based Incentives

    Short-Term Cash Based Incentives In March 2024, the compensation committee approved the terms of the fiscal 2024 short-term cash based incentives. Our NEOs short-term cash based incentives are targeted at approximately 0.2% of consolidated budgeted sales and 0.4% of consolidated budgeted sales at maximum payout. The short-term cash based incentives are appropriate to provide for increased payouts due to the significant shareholder returns commonly generated by above-target net sales, product margin and operating profit performance. The compensation committee has the discretion under the plan to reduce the awards paid under the plan, but does not have discretion to increase payouts that are based on achievement of the objective performance goals or make a payout based on the objective performance goals if the first threshold targets are not achieved. All of our executives are subject to our Compensation Clawback Policy (discussed previously on page 17), which further mitigates excessive risk taking. No payouts are made until audited financial results are received, reviewed and approved by the audit committee at our March meeting after our fiscal year has ended. For each of the following performance measures, net sales, product margin and operating profit, the compensation committee established performance metrics for the NEOs. Performance metrics were established for North America operations and other international, consisting of Europe and Australia operations, for net sales, product margin and operating profit. The performance metrics on a consolidated basis were established for operating profit. These performance measures exclude the impact of changes in the foreign exchange rate, additional valuation allowances beyond those in the budgeted plan and does not include any share repurchases in the dilutive share count. Performance metrics for North America and other international operations are tightly managed and to the extent that overall shareholder return is still met, the compensation committee is allowed to make certain adjustments for strategic items not planned that negatively impact short-term growth expectations, but contribute to long-term growth expectations of the business unit. The first threshold relates to a minimum acceptable level of financial performance. The second threshold is intended to be the target performance. If the minimum acceptable level is achieved for any given metric, the incentives are calculated on a sliding scale culminating in the top threshold, which is designed as a stretch challenge. The compensation committee believes these goals are not easily achieved and, in the nineteen years since becoming a public company, no NEO has achieved all of the stretch challenge measurement goals. The compensation committee used different performance measures for different NEOs. These are noted in the following tables which show the performance thresholds for each performance measure used for fiscal 2024:

  20. Short-Term Cash Based Incentives

    | | Performance Metrics - Consolidated (amounts are in thousands, except for net sales growth and product margin improvement) | | | | | | Objective Measure | 1 | 2 | 3 | 4 | 5 | | | | Target | | | | | Net sales growth - North America | 3.3% | 6.0% | 22.3% | 29.1% | 36.9% | | Net sales growth - Other international | 9.5% | 13.0% | 18.6% | 21.4% | 25.0% | | Product margin improvement - North America | Last year plus | Last year plus | Last year plus | Last year plus | Last year plus | | | 0.6% | 0.9% | 1.1% | 1.3% | 1.4% | | Product margin improvement - Other international | Last year plus | Last year plus | Last year plus | Last year plus | Last year plus | | | 2.2% | 3.0% | 3.7% | 4.0% | 4.3% | | Operating profit dollar improvement - North America | 21,719 | 28,103 | 67,890 | 84,711 | 104,456 | | Operating profit dollar improvement - Other international | 49,446 | 53,127 | 57,676 | 59,960 | 62,859 | | Operating profit dollar improvement - Global | 69,723 | 79,788 | 124,124 | 143,229 | 165,873 |

  21. Short-Term Cash Based Incentives

    The following table represents the percentage of the respective NEOs base salary that will be earned upon achievement of the performance thresholds (“Threshold Percentage”):

  22. Short-Term Cash Based Incentives

    | | Performance Threshold | | | | | | Executive Officer | 1 | 2 | 3 | 4 | 5 | | Thomas D. Campion, Chairman of the Board | 33% | 65% | 98% | 114% | 130% | | Richard M. Brooks, Chief Executive Officer and Director | 63% | 125% | 188% | 219% | 250% | | Christopher C. Work, Chief Financial Officer | 38% | 75% | 113% | 131% | 150% | | Chris K. Visser, Chief Legal Officer and Secretary | 33% | 65% | 98% | 114% | 130% | | Adam C. Ellis, President International | 30% | 60% | 90% | 105% | 120% |

  23. Short-Term Cash Based Incentives

    The threshold percentages in the table above are multiplied by the percentages in the following table for each performance threshold achieved (“Objective Measure Weighting Percentage”). The compensation committee weights each threshold for each of the NEOs based upon that individual’s ability to impact the measure. The objective measures are weighted between North America and other international performance thresholds based on fiscal 2024 budgeted sales results, with exception of the President International, whose objective measures are weighted higher for other international operations.

  24. Short-Term Cash Based Incentives

    | | Objective Measure | | | | | | | | Executive Officer | North America Net Sales | Other Inter-national Net Sales | North America Product Margin | Other Inter-national Product Margin | North America Operating Profit | Other Inter-national Operating Profit | Consolidated Operating Profit | | Thomas D. Campion, Chairman of the Board | 24% | 6% | 16% | 4% | n/a | n/a | 50% | | Richard M. Brooks, Chief Executive Officer and Director | 24% | 6% | 16% | 4% | n/a | n/a | 50% | | Christopher C. Work, Chief Financial Officer | 24% | 6% | 16% | 4% | n/a | n/a | 50% | | Chris K. Visser, Chief Legal Officer and Secretary | 24% | 6% | 16% | 4% | n/a | n/a | 50% | | Adam C. Ellis, President International | 6% | 24% | 4% | 16% | 10% | 40% | n/a |

  25. Short-Term Cash Based Incentives

    Therefore, for each performance threshold achieved, the calculation of the short-term cash based incentive earned is as follows:

  26. Base Salary ($) x Threshold Percentage x Objective Measure Weighting Percentage

    Base Salary ($) x Threshold Percentage x Objective Measure Weighting Percentage During fiscal 2024, we exceeded the level one threshold for North America net sales, and North America operating profit. We did not achieve any of the North America product margin, Consolidated operating profit, Other International product margin, Other International net sales or operating profit. Accordingly, no short-term cash incentive awards were paid to the NEOs for fiscal 2024. The short-term cash based incentives targets and the actual compensation paid to the NEOs for fiscal 2024 are as follows:

  27. Base Salary ($) x Threshold Percentage x Objective Measure Weighting Percentage

    | Executive Officer | Short-Term Cash Based Incentive Compensation Target | Short-Term Cash Based Incentive Compensation Paid | | Thomas D. Campion, Chairman of the Board | $217,750 | $32,140 | | Richard M. Brooks, Chief Executive Officer and Director | $918,750 | $135,608 | | Christopher C. Work, Chief Financial Officer | $350,250 | $51,697 | | Chris K. Visser, Chief Legal Officer and Secretary | $253,500 | $37,417 | | Adam C. Ellis, President International | $264,000 | $32,498 |

  28. Bonus

    Bonus While we continue to execute growth strategies and invest for the future, the compensation committee recognizes the uncertain economic environment that has the potential to negatively impact virtually every industry including consumer discretionary spending businesses such as ours. The compensation committee recognizes that in some circumstances it may be advisable to establish and pay discretionary bonuses in order to reward NEOs for managing the business during unusual circumstances or difficult economic conditions. For example, in a situation where at the beginning of a fiscal year there was believed to be a wide range of possible financial outcomes, this variability may make it difficult to set targets for short-term cash-based incentives. Accordingly, at the end of the fiscal year the compensation committee retains the discretion to award a bonus if the NEOs were able to achieve meaningful results during the fiscal year. We may also award discretionary cash bonuses from time to time in order to attract and retain key NEOs. The intention is to pay such bonuses rarely if and only if other elements of the executive pay system do not respond to outstanding achievements clearly pursued and delivered in the interests of our shareholders. The compensation committee evaluates the below criteria in determining whether to award a bonus, including: current environment and current year performance, • comparison of performance to peer group, • cash and working capital position, and • comparison to the incentive metrics of net sales, product margin and operating profit had the short-term cash-based incentive program been in place. For fiscal 2024, the compensation committee did not elect to make any discretionary bonuses.

  29. Long-Term Equity Incentives

    Long-Term Equity Incentives The compensation committee uses long-term equity incentives as a significant component of total compensation consistent with the culture and compensation philosophy. The compensation committee continues to believe in the importance of equity compensation for all executive officers and issues equity incentives broadly through the management population. Additionally, because we do not have a pension or a supplemental executive retirement plan, we believe our executives should plan for their retirement substantially through potential wealth accumulation from equity gains. Long-term equity incentive awards are determined through a combination of the Company’s performance, execution of our total compensation strategy of rewarding executives and providing a foundation for wealth building. Our stock option awards generally have a ten-year term and typically vest 25% per year. Our restricted stock awards generally vest 33% per year. The compensation committee met in March 2024 and considered the performance of the Company, its overall compensation strategy and the level of equity grants to align the NEOs with shareholders. Based on the compensation committee’s deliberations, the following equity incentive awards were granted:

  30. Long-Term Equity Incentives

    | Executive Officer | Restricted Stock Grants | Stock Option Grants | | Thomas D. Campion, Chairman of the Board | — | — | | Richard M. Brooks, Chief Executive Officer and Director | — | — | | Christopher C. Work, Chief Financial Officer | 24,399 | 45,839 | | Chris K. Visser, Chief Legal Officer and Secretary | 16,891 | 31,734 | | Adam C. Ellis, President International | 22,522 | 42,313 |

  31. Long-Term Equity Incentives

    The compensation committee believes the levels of grants are appropriate, consistent with its compensation strategy and provide a meaningful alignment of the NEOs with the Company’s shareholders. Equity Grant Timing Practices. All stock options granted at Zumiez have an exercise price equal to the closing market price of our stock on the grant date. Regular annual grants for employees are approved at the March compensation committee and board meetings, and the grant date for such annual grants is generally the second business day after the later to occur of the following: the public release of fiscal year-end earnings or the filing of the annual report on Form 10-K covering the fiscal year period. In cases when the filing of the annual report on Form 10-K is scheduled to occur more than three business days after the public release of fiscal year-end earnings, then the grant date of annual grants may occur on the second business day after the public release of fiscal year-end earnings provided that the grant date does not occur less than four business days before the filing of the annual report on Form 10-K. The grants are approved as formulas based on a specified dollar amount and approved dilution percentages; the number of shares and exercise price for each option grant are determined based on the closing market price of our stock on the grant date, and the number of shares for each restricted stock grant is determined by dividing the dollar amount by the closing market price of our stock on the grant date. The board gives the CEO the ability to grant a small number of equity awards for the current fiscal year at the March board meeting for new hires and promotions.

  32. The Compensation Decision-making Process

    The Compensation Decision-making Process The compensation committee gathers together information to help it assess compensation for the NEOs, including: • Tally sheets—We use tally sheets for each of the NEOs to summarize the significant components of compensation, including base salary, short-term cash based incentives, bonuses, and equity incentives. The tally sheets are compared to targeted total compensation. • Competitive compensation analysis—At the compensation committee’s direction, the compensation consultant developed and delivered analysis of competitive compensation for each NEO position. The focus was on a representative benchmarking peer group to reflect the competitive market for executive talent. The benchmarking peer group was developed using industry, revenue and retail segment screening criteria to identify the peer group, which included Abercrombie & Fitch, American Eagle Outfitters, Buckle, Cato Corp, Citi Trends, Duluth Holdings, Five Below, Genesco, Hibbett Sports, Lands' End, Sportsman’s Warehouse Holdings, Tilly's, Urban Outfitters, and Vera Bradley. Analysis was performed using publicly-available information on executive pay levels compiled from the most recently available proxy statements of publicly-held companies. The compensation consultant provided expert opinions and conclusions to the compensation committee about targets for base salary, short-term cash based incentives and long-term equity incentives for our NEO roles. The committee used this information to ensure that our stated philosophy and strategy for aligning executive compensation opportunities with the competitive market has been and continues to be fulfilled. • Fiscal 2024 results—The compensation committee has access to fiscal 2024 operating plans and budgets as approved by the board of directors in March 2024. Management updates the compensation committee and the board on actual performance compared to budgets and summarizes for the compensation committee how the Company and the NEOs performed against the performance targets. • Fiscal 2025 operating and financial plans—The compensation committee also receives the operating plan and budgets for fiscal 2025 as approved by the Company’s board of directors. The compensation committee uses this information to help establish performance targets for the upcoming fiscal year. Audited results—The compensation committee reviews the final audited results to confirm that performance targets were achieved. No incentive awards are made until audited results are received by the board. Performance of peer retailers—The compensation committee requests that management prepare a schedule comparing our performance, including comparable sales growth, operating income and earnings per share, for the last five fiscal years to the above stated peer group. All of the information for these retailers was summarized from publicly available data. The compensation committee compares our relative performance as an additional data point understanding that all of these companies are larger and may have significantly different business models with significantly different growth profiles. Evaluations—The compensation committee receives a self-evaluation and confidential upward evaluations of the CEO and summary evaluations of the remaining NEOs. The compensation committee chair solicits the full membership of the board for feedback on the CEO’s performance and prepares the CEO’s annual evaluation for review by the full compensation committee. The compensation committee thoroughly and systematically reviews and discusses all information submitted. It asks management to clarify and supplement as appropriate. The committee then works with its consultant to determine fair and competitive compensation awards and opportunities for each of the NEOs. The compensation committee currently structures the NEO compensation program to: • Provide conservative (40th percentile) base salary opportunities against the Company’s competitive market for executive compensation talent. • Establish average (50th percentile) total cash compensation opportunities (base salary, bonus and Short-Term Cash Based Incentives) against the competitive market. • Provide long-term equity-based awards at the 50th percentile when compared to competitive practices for comparable roles. In the case of our Chairman and our CEO who beneficially own 5.2% and 13.5% of the Company, respectively, the compensation committee has concluded that each executive owns a sufficient amount of equity to align them with the long-term interests of shareholders. Because of this, neither our Chairman nor our CEO has received equity grants since before the Company’s initial public offering. The compensation committee evaluates this approach to total direct compensation on an annual basis to best maintain alignment of the interests of NEO’s with the long-term economic interests of shareholders, given the maturity, complexity and size of the business. Included is a thorough review of the approach to the Chairman and CEO, where the committee reserves the right to provide additional equity-based awards to the incumbents if it determines doing so is in the best interests of shareholders and/or is needed to best reflect competitive practices. During its deliberations, the compensation committee also considers: • Long-term wealth accumulation—the accumulated wealth from previous equity incentives granted to each NEO. • Internal pay equity—the relationship between the compensation of our CEO and the other NEOs, as well as staff at-large. There is discretion inherent in the compensation committee’s role of establishing compensation for the NEOs. The compensation committee has attempted to minimize discretion by focusing on the three objective financial measures it considers to be the long-term drivers of the Company’s business: net sales, product margin and operating profit. These performance measures have historically been used to determine the short-term cash based incentives and are also key considerations in determining changes to base salary and long-term equity incentive awards. Some discretion is used by the compensation committee in evaluating the qualitative performance of the NEOs in determining base salary adjustments and payment of discretionary bonuses. Some discretion is also used in the granting of long-term equity incentive awards to help NEOs build wealth through ownership of Zumiez stock. However, in all of these uses of discretion the compensation committee is also governed by the overall compensation philosophy; and, is guided by explicit competitive targets and ranges of reasonableness. In making its final decisions, the committee works to ensure that all outcomes are thoroughly justifiable and defensible as well as fair and effective from all critical perspectives: those of the full board, shareholders, objective external experts and the NEOs themselves. Advisory Vote on Executive Compensation. The shareholders of the Company are provided the opportunity to provide an advisory vote on the Company’s executive compensation every year. At the last such vote in June 2024 the shareholders of the Company approved the Company’s executive compensation in an advisory vote with 96.6% of the votes being cast in favor of the Company’s executive compensation. The compensation committee viewed this vote as strong support for its executive compensation decisions and policies and, accordingly, it did not consider making changes to its executive compensation decisions and policies in response to the 2024 advisory shareholder vote.

  33. Enterprise Risk and Compensation

    Enterprise Risk and Compensation The compensation committee considers all facets of the NEOs compensation structure and believes it appropriately balances the drive for financial results and risks to the Company. The compensation committee aligns executive compensation with shareholder interests by placing a majority of total compensation “at risk,” and increasing the amount of pay that is “at risk” as the executives achieve higher levels of performance. “At risk” means the executive will not realize value unless performance goals are attained. The short-term incentives are tied to easily measurable financial metrics that the compensation committee believes are consistent, transparent and drive shareholder value; that is, net sales, product margin and operating profit. The majority of the long-term based compensation vests over several years and is not tied to specific financial metrics. By combining annual cash incentives tied to short-term financial performance along with the majority of the NEOs long-term wealth creation tied to stock performance, the compensation committee believes an appropriate balance exists between rewarding performance without excessive risk taking. In addition, the compensation committee believes the short-term incentives in place that are tied to financial performance do not provide excessive risk to the Company as they are capped at no more than 250% of base pay for our CEO, 130% for our Chairman of the Board, 150% for our Chief Financial Officer, 130% for our Chief Legal Officer and Secretary and 120% for our President International. The compensation committee believes that the overall executive compensation policy contains less than a ‘reasonable likelihood’ of material risk.

  34. Employment Agreements

    Employment Agreements None of our U.S. employees have an employment agreement and all U.S. employees are “at will.”

  35. CEO/Median Employee Pay Ratio

    CEO/Median Employee Pay Ratio We believe in delivering quality employment experiences at all levels within the Company. In that regard, every year we create thousands of career opportunities for individuals who are just beginning their professional careers and who are driven to develop new skills in an environment centered around teaching and learning. Many of these opportunities are provided to our part-time sales associates, who on average are approximately 20 years of age, and are often furthering their career through concurrent education and/or additional employment opportunities. The median employee was identified by calculating fiscal year taxable income for each of our 8,398 employed individuals, excluding our CEO, on February 1, 2025. All employees located in North America and Europe were included in the calculation. A de minimis number of non-U.S. employees, approximately 270 located in Australia, were excluded. Additionally, any earnings paid to employees in a foreign currency were converted to U.S. dollars using the applicable exchange rates on the date listed above. To help assure an accurate representation of the median employee, earnings for regular employees employed for less than one year were annualized based on their individual average earnings to date. For fiscal 2024, we identified our median employee to be a part-time Sales Associate in one of our U.S. stores, whose annual compensation was $6,732. As stated in the “Total” column in the Summary Compensation Table, our CEO’s total compensation for fiscal 2024 was $877,260. As a result, we estimate our CEO to median employee pay ratio to be 130:1.

  36. Summary Compensation Table

    Summary Compensation Table The following table shows all compensation for fiscal 2024, 2023 and 2022 awarded to, earned by, or paid to our CEO, our CFO and our other named executive officers.

  37. Summary Compensation Table

    | | | Salary | Bonus | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | All Other Compensation | Total | | Name and Principal Position | Year | ($) (1) | ($) (2) | ($) (3) | ($) (4) | ($) (5) | ($) (6) | ($) | | Thomas D. Campion | 2024 | 335,000 | — | — | — | 32,140 | 3,658 | 370,798 | | Chairman of the Board | 2023 | 335,033 | — | — | — | — | 3,523 | 338,556 | | | 2022 | 335,033 | — | — | — | — | 4,986 | 340,019 | | Richard M. Brooks | 2024 | 735,000 | — | — | — | 135,608 | 6,652 | 877,260 | | Chief Executive Officer | 2023 | 735,000 | — | — | — | — | 5,081 | 740,081 | | and Director | 2022 | 735,000 | — | — | — | — | 5,487 | 740,487 | | Christopher C. Work | 2024 | 467,000 | — | 324,995 | 324,999 | 51,697 | 4,191 | 1,172,881 | | Chief Financial Officer | 2023 | 453,000 | — | 274,985 | 275,000 | — | 3,355 | 1,006,340 | | | 2022 | 453,000 | — | 209,987 | 209,986 | — | 3,708 | 876,681 | | Chris K. Visser | 2024 | 390,000 | — | 224,988 | 224,994 | 37,417 | 5,121 | 882,520 | | Chief Legal Officer | 2023 | 378,000 | — | 174,990 | 174,990 | — | 4,177 | 732,157 | | and Secretary | 2022 | 377,788 | — | 149,985 | 149,999 | — | 4,930 | 682,702 | | Adam C. Ellis | 2024 | 440,000 | — | 299,993 | 299,999 | 32,498 | 357,140(7) | 1,429,630 | | President International | 2023 | 427,000 | — | 249,986 | 249,992 | — | 181,010(7) | 1,107,988 | | | 2022 | 427,000 | — | 179,966 | 179,982 | — | 461,523(7) | 1,248,471 |

  38. Summary Compensation Table

    (1) This column represents the base salary earned during fiscal 2024, 2023 and 2022. We use a fiscal calendar consisting of a 52- or 53-week period ending on the Saturday closest to January 31. (2) There were no bonus compensation awarded to NEOs during fiscal 2024, 2023 and 2022, and paid (if applicable) in early fiscal 2025, 2024, and 2023, respectively. For additional information on the amount related to bonus compensation, see the previous discussion in the Compensation Discussion and Analysis entitled “Bonus.” (3) This column represents the aggregate grant-date fair value of restricted stock awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2024, 2023 and 2022 Form 10-K reports, respectively. Information regarding the restricted stock awards granted to the NEOs during fiscal 2024 is set forth in the Grants of Plan-Based Awards Table on a grant-by-grant basis. (4) This column represents the aggregate grant-date fair value of stock option awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2024, 2023 and 2022 Form 10-K reports, respectively. Information regarding the stock option awards granted to our NEOs during 2024 is set forth in the Grants of Plan-Based Awards Table on a grant-by-grant basis. (5) The amounts set forth in this column were earned during fiscal 2024 and paid in early fiscal 2025 to each of the NEOs under our executive Short-Term Cash Based Incentives. For additional information on the determination of the amounts related to Non-Equity Incentive Plan Compensation, see the previous discussion in the Compensation Discussion and Analysis entitled, “Short-Term Cash Based Incentives.” Information regarding the threshold, target and maximum estimated future payouts under non-equity incentive plan awards is set forth in the Grants of Plan-Based Awards Table. (6) All other compensation includes 401(k) employer match contributions and company paid life insurance premiums. In fiscal 2017, Mr. Ellis relocated to Austria at our request and received international assignment-related benefits, including housing-related expenses and tax equalization. In fiscal 2024, $271,287 in tax equalization payments, $49,767 in housing-related benefits, and $36,086 in other assignment related benefits. In fiscal 2023, $117,776 in tax equalization payments, $51,101 in housing-related benefits, and $12,134 in other assignment related benefits. In fiscal 2022, he received $388,149 in tax equalization payments, $49,957 in housing-related benefits, and $13,340 in other assignment related benefits. The tax-equalization payments are intended to place Mr. Ellis in a similar net tax position as a similarly compensated employee in the United States.

  39. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table provides information about equity and non-equity awards granted to the NEOs in fiscal 2024. In the columns described as Estimated Future Payouts Under Non-Equity Incentive Plan Awards, this table quantifies potential awards under the executive short-term cash based incentives plan discussed previously.

  40. Grants of Plan-Based Awards

    | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | | | All Other Stock Awards: Number of Shares of Stock | All Other Option Awards: Number of Securities Underlying | Exercise or Base Price of Option | Grant Date Fair Value of Stock and Option | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | or Units (#) (2) | Options (#) (3) | Awards ($) (4) | Awards ($) (5) | | Thomas D. Campion | | 108,875 | 217,750 | 435,500 | — | — | — | — | | Chairman of the Board | | | | | | | | | | Richard M. Brooks | | 459,375 | 918,750 | 1,837,500 | — | — | — | — | | Chief Executive Officer and Director | | | | | | | | | | Christopher C. Work | | 175,125 | 350,250 | 700,500 | | | | | | Chief Financial Officer | 3/18/2024 | | | | 24,399 | | | 324,995 | | | 3/18/2024 | | | | | 45,839 | 13.32 | 324,999 | | Chris K. Visser | | 126,750 | 253,500 | 507,000 | | | | | | Chief Legal Officer and Secretary | 3/18/2024 | | | | 16,891 | | | 224,988 | | | 3/18/2024 | | | | | 31,734 | 13.32 | 224,994 | | Adam C. Ellis | | 132,000 | 264,000 | 528,000 | | | | | | President International | 3/18/2024 | | | | 22,522 | | | 299,993 | | | 3/18/2024 | | | | | 42,313 | 13.32 | 299,999 |

  41. Grants of Plan-Based Awards

    (1) These columns show what the potential payout for each NEO was under the executive short-term cash based incentives for fiscal 2024 if the threshold, target or maximum goals were satisfied for all performance measures. The short-term cash-based incentive was approved in March 2024. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Short-Term Cash Based Incentives” and the Summary Compensation Table for amounts earned by the NEOs in fiscal 2024. (2) This column shows the number of shares of restricted stock granted in fiscal 2024 to the NEOs. The restricted stock awards vest over a three-year period in equal annual installments beginning on the first anniversary date of the grant. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Long-Term Equity Incentives.” Information on the aggregate grant-date fair value of restricted stock awards is set forth in the Summary Compensation Table. (3) This column shows the number of stock options granted in fiscal 2024 to the NEOs. These stock options vest over a four-year period in equal annual installments beginning on the first anniversary date of the grant. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Long-Term Equity Incentives.” Information on the aggregate grant-date fair value of stock option awards is set forth in the Summary Compensation Table. (4) This column shows the exercise price for the stock options granted, which was the closing price of the Company’s stock on the grant date indicated. This column represents the aggregate grant-date fair value of restricted stock and stock option awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2024 Form 10-K. These amounts reflect the Company’s accounting expense for these stock options and restricted stock awards to be recognized over the vesting period of the grants, and do not correspond to the actual value that will be recognized by the NEO.

  42. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table provides information on the holdings of stock option awards and restricted stock awards for the NEOs at February 1, 2025. This table includes unexercised and unvested stock options and restricted stock awards. The vesting schedule for each grant of stock options and restricted stock awards is shown in the footnotes to this table. The market value of the restricted stock awards is based on the closing market price of our stock on February 1, 2025, which was $15.96.

  43. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Stock Awards | | | | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable | Options Exercise Price | Option Expiration | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock that Have Not Vested | | Name | (#) | (#) | ($) | Date | (#) | ($) | | Thomas D. Campion | — | — | — | — | — | — | | Chairman of the Board | | | | | | | | Richard M. Brooks | — | — | — | — | — | — | | Chief Executive Officer and Director | | | | | | | | Christopher C. Work | 3,011(1) | — | 38.57 | 3/16/2025 | — | — | | Chief Financial Officer | 2,699(2) | — | 23.40 | 3/19/2028 | — | — | | | 6,266(3) | — | 24.54 | 3/18/2029 | — | — | | | 13,986(4) | — | 18.60 | 3/16/2030 | — | — | | | 5,784(5) | 1,928 | 45.31 | 3/15/2031 | — | — | | | 5,284(6) | 5,284 | 40.46 | 3/14/2032 | — | — | | | 6,342(7) | 19,027 | 20.66 | 3/13/2033 | — | — | | | —(8) | 45,839 | 13.32 | 3/18/2034 | | | | | — | — | — | — | 1,730(9) | 27,611 | | | — | — | — | — | 8,872(10) | 141,597 | | | — | — | — | — | 24,399(11) | 389,408 | | Chris K. Visser | 2,611(3) | — | 24.54 | 3/18/2029 | — | — | | Chief Legal Officer and Secretary | 8,159(4) | — | 18.60 | 3/16/2030 | — | — | | | 4,957(5) | 1,653 | 45.31 | 3/15/2031 | — | — | | | 3,774(6) | 3,775 | 40.46 | 3/14/2032 | — | — | | | 4,035(7) | 12,108 | 20.66 | 3/13/2033 | — | — | | | —(8) | 31,734 | 13.32 | 3/18/2034 | — | — | | | — | — | — | — | 1,235(9) | 19,711 | | | — | — | — | — | 5,646(10) | 90,110 | | | — | — | — | — | 16,891(11) | 269,580 | | Adam Ellis | 13,112(4) | — | 18.60 | 3/16/2030 | — | — | | President International | 4,957(5) | 1,653 | 45.31 | 3/15/2031 | — | — | | | 4,529(6) | 4,529 | 40.46 | 3/14/2032 | — | — | | | 5,765(7) | 17,297 | 20.66 | 3/13/2033 | — | — | | | —(8) | 42,313 | 13.32 | 3/18/2034 | — | — | | | — | — | — | — | 1,482(12) | 23,653 | | | — | — | — | — | 8,066(13) | 128,733 | | | — | — | — | — | 22,522(14) | 359,451 |

  44. Outstanding Equity Awards at Fiscal Year-End

    (1) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 16, 2015. (2) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 19, 2018. (3) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 18, 2019. Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 16, 2020. Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 15, 2021. Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 14, 2022. (7) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 13, 2023. (8) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 18, 2024. (9) This restricted stock grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 14, 2022. (10) This restricted stock grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 13, 2023. (11) This restricted stock grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 18, 2024. (12) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 14, 2022. (13) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 13, 2023. This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 18, 2024.

  45. Option Exercises and Stock Vested

    Option Exercises and Stock Vested The following table provides information for the NEOs on stock option exercises and on the vesting of other stock awards during fiscal 2024, including the number of shares acquired upon exercise or vesting and the value released before payment of any applicable withholding taxes and broker commissions.

  46. Option Exercises and Stock Vested

    | | Option Awards | | Stock Awards | | | | Number of Shares Acquired on Exercise | Valued Realized on Exercise (1) | Number of Shares Acquired on Vesting | Value Realized on Vesting (2) | | Name | (#) | ($) | (#) | ($) | | Thomas D. Campion | — | — | — | — | | Chairman of the Board | | | | | | Richard M. Brooks | — | — | — | — | | Chief Executive Officer and Director | | | | | | Christopher C. Work | — | — | 7,455 | 111,331 | | Chief Financial Officer | | | | | | Chris K. Visser | — | — | 5,162 | 76,682 | | Chief Legal Officer and Secretary | | | | | | Adam C. Ellis | — | — | 13,240 | 189,000 | | President International | | | | |

  47. Option Exercises and Stock Vested

    (1) The dollar amount realized upon exercise was calculated by determining the difference between the market price of the underlying shares of common stock at exercise and the exercise price of the stock options. (2) The dollar amount realized upon vesting was calculated by applying the market price of the restricted stock shares on the vesting dates.

  48. Pension Benefits

    Pension Benefits The Company does not maintain a defined benefit pension plan or supplemental pension plan.

  49. Nonqualified Deferred Compensation

    Nonqualified Deferred Compensation The Company does not maintain a nonqualified deferred compensation plan.

  50. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control Certain of the NEOs have unvested stock options and awards of restricted stock under the Company’s 2023 Equity Incentive Plan and 2014 Equity Incentive Plan, the vesting of which may accelerate in the event of a Change in Control (as defined below). The Company does not maintain a severance or separation plan, or any such individual plans, for its executive officers. Accordingly, except as described below, there are no agreements, arrangements or plans that entitle the Company’s executive officers to enhanced benefits upon termination of their employment. The information below is a summary of certain provisions of these agreements and does not attempt to describe all aspects of the agreements. The rights of the parties are governed by the actual agreements and are in no way modified by the abbreviated summaries set forth in this proxy statement. Double-Trigger Acceleration of Stock Award Vesting The Company’s 2023 Equity Incentive Plan and 2014 Equity Incentive Plan each have a double-trigger acceleration which provides that in the event of a Change in Control we do not accelerate vesting of awards that are assumed or replaced by the resulting entity after a change in control unless an employee employment is also terminated by the Company without cause or by the employee with good reason within one year of the change in control. For purposes of both the 2023 Equity Incentive Plan and the 2014 Equity Incentive Plan, “Change in Control” means: (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation or other reorganization; or (ii) the sale, transfer or other disposition of all or substantially all of the Company’s assets. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction. The following table shows the potential payments the NEOs could have received under these arrangements in connection with a Change in Control on February 1, 2025:

  51. Potential Payments Upon Termination or Change in Control

    | | Change in Control with Double Trigger Acceleration | | | Executive Officer | Stock Option Vesting in Connection with a Change in Control (1) | Restricted Stock Vesting in Connection with a Change in Control (2) | | Thomas D. Campion Chairman of the Board | $— | $— | | Richard M. Brooks, Chief Executive Officer and Director | $— | $— | | Christopher C. Work Chief Financial Officer | $121,015 | $558,616 | | Chris K. Visser Chief Legal Officer and Secretary | $83,778 | $379,401 | | Adam C. Ellis President International | $111,706 | $511,837 |

  52. Potential Payments Upon Termination or Change in Control

    Represents the amount calculated by multiplying the number of in-the-money unvested options with respect to which the vesting would accelerate as a result of Change in Control under the circumstances of a double trigger acceleration as defined in both the 2023 Equity Incentive Plan and the 2014 Equity Incentive Plan noted by the difference between the exercise price and the closing price of a share of common stock on the last trading day of fiscal 2024. The number of shares subject to unvested stock options and exercise prices thereof are shown previously in the Outstanding Equity Awards at Fiscal Year-End table. Represents the amount of unvested restricted stocks awarded with respect to which the vesting would accelerate as a result of a Change in Control under the circumstances of a double trigger acceleration as defined in both the 2023 Equity Incentive Plan and the 2014 Equity Incentive Plan noted by the number of restricted stock shares unvested at the closing price of a share of common stock on the last trading day of fiscal 2024. Death or Disability The restricted stock awarded under both the Company’s 2023 Equity Incentive Plan and the Company’s 2014 Equity Incentive Plan provide that if a participant’s employment is terminated by reason of death or disability (as defined in the aforementioned plans), then unvested restricted stock awards would accelerate and immediately vest. Beginning in March 2020, the stock options awarded under the Company’s aforementioned equity incentive plans provides that if a participant’s employment is terminated by reason of death or disability (as defined in the aforementioned plans), then unvested stock options would accelerate and immediately vest. The value of the potential payments the NEOs that would have vested assuming a February 1, 2025 termination of employment due to death or disability was: Christopher C. Work, $679,631; Chris K. Visser, $463,179; and Adam C. Ellis, $623,544.

  53. Pay Versus Performance

    Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation and certain financial performance metrics of the Company. The following tables and graphs below summarize the relationship between compensation “actually paid” (referred to as “Compensation Actually Paid” or the “CAP Amounts”) to the Chief Executive Officer (CEO) and the Non-CEO Named Executive Officers (“Non-CEO NEOs”), and the financial performance of the Company over the time horizon set forth below in accordance with SEC rules. The compensation committee does not use the CAP Amounts as a basis for making compensation decisions. For further information concerning the Company’s pay for performance philosophy and how the Company aligns executive compensation with performance, see “Compensation Discussion and Analysis” beginning on page 33.

  54. Pay Versus Performance Table

    Pay Versus Performance Table

  55. Pay Versus Performance Table

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | Company Selected Measures | | Year | Summary Compensation Table Total for CEO (1) | Compensation Actually Paid to CEO (2) | Average Summary Compensation Table Total for Non-CEO NEOs (3) | Average Compensation Actually Paid for Non-CEO NEOs (4) | Cumulative Total Shareholder Return (5) | Peer Group Cumulative Total Shareholder Return (6) | Net (Loss) Income ($ millions) (7) | Operating (Loss) Profit ($ millions) (8) | | 2024 | 877,260 | 877,260 | 963,957 | 1,004,697 | 70.41 | 163.65 | (1.7) | 2.0 | | 2023 | 740,081 | 740,081 | 796,260 | 542,867 | 56.79 | 130.96 | (62.6) | (64.8) | | 2022 | 740,487 | 740,487 | 909,952 | 268,029 | 82.61 | 128.25 | 21.0 | 31.1 | | 2021 | 2,474,467 | 2,474,467 | 1,367,156 | 1,369,613 | 138.76 | 138.31 | 119.3 | 157.8 | | 2020 | 1,664,205 | 1,664,205 | 1,118,380 | 1,885,722 | 138.21 | 122.73 | 76.2 | 96.9 |

  56. Pay Versus Performance Table

    (1) Represents total compensation reported for our CEO, Mr. Brooks, as set forth in the total column of the Summary Compensation Table for the applicable year (2) Represents Compensation Actually Paid for Mr. Brooks, as calculated in accordance with Item 402(v) of Regulation S-K. As discussed in the Compensation Discussion and Analysis beginning on page 33, the CEO has not received equity grants since before the Company’s initial public offering and the Company does not maintain any defined benefit or actuarial pension plans for any of the NEOs. Accordingly, there are no applicable adjustments per Item 402(v) of Regulation S-K to the CEO’s total compensation as reported for each corresponding year in the “Total” column of the Summary Compensation Table for the applicable year. (3) Represents the average of the amounts of total compensation reported for our Non-CEO NEO as set forth in the Total column of the Summary Compensation Table for the applicable year. Our Non-CEO NEOs for fiscal 2020, 2021, and 2022 were Thomas D. Campion, Christopher C. Work, Chris K. Visser, Troy Brown and Adam C. Ellis. Our Non-CEO NEOs for fiscal 2023 and 2024 are Thomas D. Campion, Christopher C. Work, Chris K. Visser and Adam C. Ellis. (4) The amounts in this column represent the average amount of Compensation Actually Paid for our Non-CEO NEOs as a group as calculated in accordance with the requirements of Item 402(v) of Regulation S-K. In accordance with Item 402(v) of Regulation S-K adjustments were made to the average total compensation reported for our Non-CEO NEOs to determine the average amount of Compensation Actually Paid and these adjustments are set forth immediately below in the reconciliation table. Equity award adjustments noted in the reconciliation table below were calculated consistent with U.S. generally accepted accounting principles, and the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant

  57. Description of Relationships Between Compensation Actually Paid and Specified Financial Measures

    Description of Relationships Between Compensation Actually Paid and Specified Financial Measures As described in greater detail in the Compensation Discussion and Analysis beginning on page 33, the Company’s executive compensation program reflects a pay-for-performance and pay-at-risk philosophy, with a large portion in the form of variable, incentive-based pay. The metrics used for the Company’s Short-Term Cash Based Incentive plan are selected based on an objective to pay for superior results and sustainable growth by rewarding the achievement of challenging short-term performance goals designed to build shareholder value and drive performance. While the Company utilizes several performance measures to align executive compensation with Company performance, all of those Company measures are not presented in the Pay Versus Performance table. The following graphs depict the general relationships between the financial performance measures and CAP. Amounts set forth above in the Pay Versus Performance Table: TSR, peer group TSR, net income and Operating Profit, which is the measure the Company identified as the most important performance measure (that is not otherwise required to be disclosed in the table) used by the Company to link Compensation Actually Paid to the Company’s NEOs, for the most recently completed fiscal year, to Company performance. Operating Profit also has an impact on the Company’s stock price and relative TSR, which affects the value of the equity awards made pursuant to the Long-Term Equity Incentive plan. Fluctuations in CAP Amounts are primarily due to the result of our stock performance and varying levels of achievement against pre-established performance goals under our Short-Term Cash Based Incentive plan. Changes in the composition of our NEOs can also affect CAP Amounts from period to period.