DEF 14A of V F Corp

Filed Jun 12, 2023 · FY20230001193125-23-164886

Open on EDGAR

Election of Directors
Election of Directors VF’s Board of Directors has nominated the persons named below whose terms expire at the meeting to serve as directors. All nominees currently serve as directors on our Board and, if reelected, will serve a term of office until our 2024 annual meeting or until a successor is duly elected and qualified. The persons named in the accompanying form of proxy/voting instruction card intend to vote such proxy for the election as directors of the following nominees, subject to any explicit instructions of the shareholder set forth on the proxy/voting instruction card. If any nominee becomes unable or unwilling to serve as a director, the proxy holders will vote for such other person or persons as may be nominated by the Board of Directors. The nominees named below have indicated that they are willing to serve if reelected to the VF Board. It is the policy of VF that a substantial majority of the members of its Board of Directors should be independent. Currently, nine of the nominees have been determined by the Board to be independent in accordance with standards adopted by the Board, as set forth in the Board’s Corporate Governance Principles and the Listing Standards of the New York Stock Exchange (“NYSE”), the securities exchange on which VF’s Common Stock is traded. The ages set forth below are as of May 30, 2023.
Election of Directors
| NAME | AGE | DIRECTOR SINCE | PRINCIPAL OCCUPATION | AUDIT COMMITTEE | TALENT AND COMPENSATION COMMITTEE | GOVERNANCE AND CORPORATE RESPONSIBILITY COMMITTEE | FINANCE COMMITTEE | | Richard T. Carucci | 65 | 2009 | Retired; Former President, Yum! Brands, Inc. | Member | | Chair | | | Alex Cho | 50 | 2022 | President, Personal Systems, HP Inc. | Member | | Member | | | Juliana L. Chugg | 55 | 2009 | Retired; Former EVP, Chief Brands Officer, Mattel, Inc. | | Chair | Member | | | Benno Dorer | 59 | 2017 | Interim President and Chief Executive Officer, VF Corporation | | | | Member (ex officio) | | Mark S. Hoplamazian | 59 | 2015 | President and Chief Executive Officer, Hyatt Hotels Corporation | | Member | | Member | | Laura W. Lang | 67 | 2011 | Managing Director, Narragansett Ventures, LLC | | Member | | Member | | W. Rodney McMullen | 62 | 2016 | Chairman and Chief Executive Officer, The Kroger Co. | Chair | | Member | | | Clarence Otis, Jr. | 67 | 2004 | Retired; Former Chairman and Chief Executive Officer, Darden Restaurants, Inc. | Member | | Member | | | Carol L. Roberts | 63 | 2017 | Retired; Former Senior Vice President and Chief Financial Officer, International Paper Company | Member | | | Chair | | Matthew J. Shattock | 60 | 2013 | Independent Chair of the Board, The Clorox Company | | Member | | Member | | Number of Meetings Held in Fiscal 2023 | | | Board – 13 | 10 | 6 | 5 | 5 |
Election of Directors
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NOMINEES
NOMINEES Our Board selected the nominees based on their experience, qualifications, attributes and skills and the belief that each can make unique and substantial contributions to VF. Together, our nominees bring to our Board a vast array of public company and multi-brand consumer product company experience, and domestic and international business experience. In addition, our nominees represent diverse viewpoints and bring a blend of historical and new perspectives about VF as a result of their varied lengths of tenure as our directors. Our Board believes, in totality, this mix of attributes among the nominees enhances our Board’s independent leadership and effectiveness and complements VF’s business and organizational complexities and long-term strategy.
NOMINEES
| RICHARD T. CARUCCI | Experience: | | | Age: 65 Director Since: 2009 Committees: • Audit • Executive (Chair) • Governance and Corporate Responsibility (Chair) | December 2022 – Present 2012 – 2014 (retired) 2005 – 2012 1997 – 2005 | Interim Chair of the VF Board President, Yum! Brands, Inc. Chief Financial Officer, Yum! Brands, Inc. Various positions in finance, international, and general management, Yum! Brands (previously named Tricon Global Restaurants) | | | Former Public Company Directorships: | | | | 2019 – 2021 | Kontoor Brands, Inc. (“Kontoor”) | | | Skills and Qualifications: | | | | Mr. Carucci’s qualifications for election include his experience as a leader of Yum! Brands, Inc., a large global multi-brand publicly traded company serving retail consumers through the operation of quick service restaurants. He also served as a board member of Kontoor, a publicly traded global apparel company. | | | ALEX CHO | Experience: | | | Age: 50 Director Since: 2022 Committees: • Audit • Governance and Corporate Responsibility | 2018 – Present 2014 – 2018 2010 – 2014 | President, Personal Systems, HP Inc. Vice President and General Manager, Commercial Personal Systems, HP Inc. Vice President and General Manager, LaserJet Supplies Business, HP Inc. | | | Mr. Cho also serves on the HP Foundation Board and Global Business Coalition for Education. | | | | Skills and Qualifications: | | | | Mr. Cho’s qualifications for election include his leadership of a growing global technology portfolio spanning consumer and commercial segments including computing, peripherals, services and software at HP Inc., a Fortune 100 publicly traded company. | |
NOMINEES
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NOMINEES
| JULIANA L. CHUGG | Experience: | | | Age: 55 Director Since: 2009 Committees: • Executive • Governance and Corporate Responsibility • Talent and Compensation (Chair) | 2015 – 2018 (retired) 2015 1996 – 2014 | EVP, Chief Brands Officer, Mattel, Inc. Partner, Noble Endeavors LLC Senior Vice President, General Mills, Inc. and President of its Frozen Frontier Division; previously held a progression of leadership roles with General Mills and Pillsbury | | | Other Public Company Directorships: | | | | 2022 – Present 2022 – Present | Darden Restaurants, Inc. MasterBrand, Inc. | | | Former Public Company Directorships: | | | | 2019 – 2021 2018 – 2020 2007 – 2013 | Kontoor Caesars Entertainment Corporation H.B. Fuller Company | | | Skills and Qualifications: | | | | Ms. Chugg’s qualifications for election include her experience leading major functions and divisions of large publicly traded multi-brand consumer products companies, most recently at Mattel, Inc., a publicly traded company and world-wide leader in the design, manufacture and marketing of toys and family products. She has also served on other public company boards of directors, including Kontoor, a publicly traded global apparel company. (Also see footnote 3 to the “Common Stock Beneficial Ownership of Certain Beneficial Owners” table below.) | | | BENNO DORER | Experience: | | | Age: 59 Director Since: 2017 Committees: • Finance (ex officio) | December 2022 – Present 2021 – 2022 2014 – 2020 (retired) 2005 – 2014 1990 – 2005 | Interim President & CEO, VF Corporation Senior Advisor, KKR & Co. Inc. Chief Executive Officer, The Clorox Company Various leadership roles, The Clorox Company Various marketing and sales roles in the U.S. and Europe, The Procter & Gamble Company | | | Former Public Company Directorships: | | | | 2021 – 2023 2020 – 2021 2016 – 2020 | Origin Materials, Inc. The Clorox Company (Executive Chair) The Clorox Company (Chair of the Board) | | | Skills and Qualifications: | | | | Mr. Dorer’s qualifications for election include his experience leading a global publicly traded multi-brand consumer products company and his service on and leadership of that company’s board of directors. | |
NOMINEES
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NOMINEES
| MARK S. HOPLAMAZIAN | Experience: | | | Age: 59 Director Since: 2015 Committees: • Finance • Talent and Compensation | 2006 – Present 1989 – 2006 | President and Chief Executive Officer, Hyatt Hotels Corporation President, The Pritzker Organization (“TPO”) | | | Other Public Company Directorships: | | | | 2006 – Present | Hyatt Hotels Corporation | | | Skills and Qualifications: | | | | Mr. Hoplamazian’s qualifications for election include his experience leading a global publicly traded multi-brand hospitality company, his supervision of the chief financial officer of a public company, and his service on the board of directors of that public company. His 17-year tenure with TPO, the principal financial and investment adviser for Pritzker family business interests, including Hyatt Hotels Corporation and its predecessors, also qualifies Mr. Hoplamazian to serve on our Board. | | | LAURA W. LANG | Experience: | | | Age: 67 Director Since: 2011 Committees: • Finance • Talent and Compensation | 2014 – Present 2012 – 2013 2008 – 2012 | Managing Director, Narragansett Ventures, LLC Chief Executive Officer, Time Inc., a division of Time Warner Chief Executive Officer, Digitas, Inc. In addition, she headed the company’s pure-play digital agencies, including Razorfish, Big Fuel, Denuo and Phonevalley | | | Other Public Company Directorships: | | | | 2022 – Present 2020 – Present | Oscar Health, Inc. Vroom, Inc. | | | Former Public Company Directorships: | | | | 2014 – 2016 2010 – 2012 2005 – 2011 | Care.com, Inc. NutriSystem, Inc. Benchmark Electronics, Inc. | | | Skills and Qualifications: | | | | Ms. Lang’s qualifications for election include her leadership experience and her digital, data, social and mobile expertise from her leadership roles at Time, Inc., one of the world’s largest branded media companies, and Digitas, Inc., one of the world’s largest digital agencies and a unit of Publicis Groupe S.A., and her service on the boards of directors of other public companies. | |
NOMINEES
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NOMINEES
| W. RODNEY MCMULLEN | Experience: | | | Age: 62 Director Since: 2016 Committees: • Audit (Chair) • Executive • Governance and Corporate Responsibility | 2014 – Present 2009 – 2013 1994 – 2009 | Chief Executive Officer, The Kroger Co. President and Chief Operating Officer, The Kroger Co. Various leadership roles, including Vice Chairman, Executive Vice President, Senior Vice President, Group Vice President, and Chief Financial Officer, The Kroger Co. | | | Other Public Company Directorships: | | | | 2003 – Present | The Kroger Co. (elected to the Board in 2003 and named Chairman of the Board in 2015) | | | Former Public Company Directorships: | | | | 2001 – 2020 | Cincinnati Financial Corporation | | | Skills and Qualifications: | | | | Mr. McMullen’s qualifications for election include his experience leading The Kroger Co., a publicly traded company and one of the world’s largest food retailers, and his service as the chair of that company’s board of directors. | | | CLARENCE OTIS, JR | Experience: | | | Age: 67 Director Since: 2004 Committees: • Audit • Executive • Governance and Corporate Responsibility | 2004 – 2014 (retired) | Chairman and Chief Executive Officer, Darden Restaurants, Inc. | | | 2002 – 2004 | Executive Vice President, Darden Restaurants, Inc., and President of its Smokey Bones Restaurants division | | | 2002 | Executive Vice President and Chief Financial Officer of Darden Restaurants, Inc. | | | 1999 – 2002 | Senior Vice President and Chief Financial Officer, Darden Restaurants, Inc. | | | Other Public Company Directorships: | | | | 2017 – Present 2006 – Present | The Travelers Companies, Inc. Verizon Communications, Inc. | | | Skills and Qualifications: | | | | Mr. Otis’s qualifications for election include his experience leading Darden Restaurants, Inc., a large publicly traded multi-brand full-service restaurant company serving retail customers, his service as (and then supervision of) the chief financial officer of a public company and leadership of the board of directors of that company, and his service on the boards of directors of other public companies. (Also see footnote 3 to the “Common Stock Beneficial Ownership of Certain Beneficial Owners” table below.) | |
NOMINEES
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NOMINEES
| CAROL L. ROBERTS | Experience: | | | Age: 63 Director Since: 2017 Committees: • Audit • Executive • Finance (Chair) | 2011 – 2017 (retired) 1980 – 2010 | Senior Vice President and Chief Financial Officer, International Paper Company Various leadership roles at International Paper Company | | | Other Public Company Directorships: | | | | 2016 – Present | Alcoa Corporation | | | Former Public Company Directorships: | | | | 2014 – 2016 | Arconic, Inc., formerly known as Alcoa, Inc. | | | Skills and Qualifications: | | | | Ms. Roberts’s qualifications for election include her experience as Chief Financial Officer of International Paper Company, her experience as a leader in many operational roles within the company, and her service on the board of directors of another public company. | | | MATTHEW J. SHATTOCK | Experience: | | | Age: 60 Director Since: 2013 Committees: • Finance • Talent and Compensation | 2009 – 2019 (retired) | Chief Executive Officer, Beam Suntory, Inc., first as an operating unit of Fortune Brands and then as a standalone public company until it was acquired by Suntory Holdings Limited in 2014 | | | 2003 – 2009 | Various leadership roles at Cadbury, PLC | | | 1987 – 2003 | Various leadership roles at Unilever, PLC | | | Other Public Company Directorships: | | | | 2020 – Present 2018 – Present | Domino’s Pizza Group, PLC (Non-Executive Chairman) The Clorox Company (Independent Chair since 2021) | | | Former Public Company Directorships: | | | | 2019 – 2020 | Beam Suntory, Inc. (Non-Executive Chairman) | | | Skills and Qualifications: | | | | Mr. Shattock’s qualifications for election include his experience leading global multi-brand consumer products companies and his service and leadership on the boards of directors of other public companies. | |
NOMINEES
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NOMINEES
The following graphics reflect certain background and demographic information of the director nominees for the annual meeting:
NOMINEES
| ITEM NO. 1 | | Election of Directors |
BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS
BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS Our Board has a breadth of skills, experiences, and demographic backgrounds and is committed to reviewing periodically its composition so that it continues to have the right mix of these attributes. We believe that our Board has demonstrated leadership in a variety of positions across various professions and industries. The following chart is not intended to be an exhaustive list of each director’s skills, experience and personal attributes, as each of them also contributes other important skills, experience, expertise and personal attributes to our Board that are not reflected in the chart. The skills and experience described below are those reviewed by the Governance and Corporate Responsibility Committee and the Board in making nomination decisions, as part of the Board succession planning process, and to identify opportunities for Board education.
BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS
| | | | | | | | | | | | | | | SKILLS/EXPERIENCE | | | | | | | | | | | | | Digital/Data Insights and Analytics | | ● | ● | ● | ● | ● | ● | | | ● | | | Public Company Executive | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | | | Retail/Direct to Consumer | ● | ● | ● | | ● | | ● | ● | | | | | Global Perspective | ● | ● | ● | ● | ● | ● | | ● | ● | ● | | | CEO Leadership | | | | ● | ● | ● | ● | ● | | ● | | | Finance | ● | | | ● | ● | ● | ● | ● | ● | | | | IT/Cybersecurity/Privacy | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | | | Agile Operations and Logistics | | ● | | ● | | | ● | | ● | | | | Business Development/M&A | ● | ● | | ● | ● | ● | ● | ● | ● | ● | | | Brand Management | | ● | ● | ● | ● | | | | | ● | | | Environmental, Social, & Governance (“ESG”) | | ● | | ● | ● | | ● | | | | | | DEMOGRAPHICS | | | | | | | | | | | | | Female | | | ● | | | ● | | | ● | | | | Male | ● | ● | | ● | ● | | ● | ● | | ● | | | African American/Black | | | | | | | | ● | | | | | Asian American | | ● | | | | | | | | | | | White | ● | | ● | ● | ● | ● | ● | | ● | ● |
BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS
| ITEM NO. 1 | | Election of Directors |
IDENTIFYING AND EVALUATING NOMINEES FOR DIRECTOR
IDENTIFYING AND EVALUATING NOMINEES FOR DIRECTOR The Board of Directors believes directors should possess backgrounds, qualifications, attributes and skills that, when taken together, provide VF with a broad range of experience. The Governance and Corporate Responsibility Committee identifies potential candidates that are proposed by Board members, management, third-party search firms and our shareholders. The Board and the Committee consider the qualifications of directors individually, and in the broader context of the Board’s overall composition, and VF’s current and future needs as well as past contributions to the Board of sitting directors, including as part of the Board’s annual self-evaluation process. Candidates are selected for their character, judgment, business experience, acumen, independence and commitment to VF and service on the Board. Board members are selected to represent all shareholders and not any particular constituency. In accordance with VF’s Corporate Governance Principles, the Committee considers diversity of experience and background in selecting nominees, and includes qualified female, gender, and racially/ethnically diverse candidates in the initial list of candidates from which any new independent director nominee is chosen by the Board. The Committee considers this policy to have been effective to date in identifying and evaluating diverse candidates. Any shareholder who wishes to recommend a candidate for consideration by the Governance and Corporate Responsibility Committee for nomination at an annual meeting should submit a written recommendation to the Secretary of VF. If the Committee does not recommend a nominee proposed by a shareholder for election as a director, then the shareholder seeking to propose the nominee would have to follow the formal nomination procedures set forth in VF’s By-Laws. VF’s By-Laws provide that a shareholder may nominate a person for election as a director if written notice of the shareholder’s intent to nominate a person for election as a director is received by the Secretary of VF (1) in the case of an annual meeting, not more than 150 days and not less than 120 days before the anniversary of the date VF mailed its proxy materials for the prior year’s annual meeting, or (2) in the case of a special meeting at which directors are to be elected, no later than seven days following the day on which notice of the meeting was first mailed to shareholders. The notice must contain specified information about the shareholder and the nominee, including such information as would be required to be included in a proxy statement pursuant to the rules and regulations established by the U.S. Securities and Exchange Commission (“SEC”) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and, among other things, include a representation as to whether or not such shareholder intends to solicit proxies in support of director nominees other than VF’s nominees in accordance with Rule 14a-19 under the Exchange Act. The Committee’s policy with regard to consideration of any potential director is the same for candidates recommended by shareholders and candidates identified by other means. Eligible shareholders may also nominate and include in our annual meeting proxy materials director nominees pursuant to the proxy access provisions in Article I, Section 13 of VF’s By-Laws.
Board of Directors
Board of Directors Nine of VF’s current directors are non-employee directors. Under the NYSE Corporate Governance Rules, no director qualifies as “independent” unless the Board of Directors affirmatively determines that the director has no material relationship with the company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the company). To assist it in making determinations of independence, the Board has adopted categorical standards that are part of the Corporate Governance Principles available on VF’s website (www.vfc.com). In evaluating the independence of directors, the Board considered transactions and relationships between each director and members of his or her immediate family. When considering commercial transactions that are made from time to time in the ordinary course of business between VF and certain entities affiliated with non-management directors, transactions are not considered to be a material transaction that would impair the independence of the relevant non-management director if the director is an executive officer or employee of another company that does business with VF in an amount which, in
Board of Directors
| CORPORATE GOVERNANCE AT VF | | Board of Directors |
Board of Directors
any single fiscal year for the past three fiscal years, is less than the greater of $1 million or 2% of such other company’s consolidated gross revenues. The Board determined that nine of VF’s ten nominees for director are free of any material relationship with VF, other than their service as directors, and are “independent” directors both under the Listing Standards of the NYSE and the categorical standards adopted by the Board. The Board determined that Mses. Chugg, Lang, and Roberts and Messrs. Carucci, Cho, Hoplamazian, McMullen, Otis, and Shattock are independent directors, and that Mr. Dorer is not an independent director. The Board, in making its determination as to Mr. Cho’s independence, considered that he is President, Personal Systems of HP Inc., which is a vendor (through resellers) to VF Corporation in the ordinary course of business. The Board, in making its determination as to Mr. Hoplamazian’s independence, considered that he is President, Chief Executive Officer and a director of Hyatt Hotels Corporation, which is a vendor to VF Corporation in the ordinary course of business. The Board, in making its determination as to Mr. McMullen’s independence, considered that he is Chairman and Chief Executive Officer of The Kroger Co. which transacts business with VF in the ordinary course of business. The Board, in making its determination as to Ms. Chugg’s and Mr. Otis’s independence, considered that Ms. Chugg and Mr. Otis serve as two of the three Trustees under the Barbey Family Trust accounts (collectively, the “Trusts”). Because all decisions of the Trustees require a majority vote, and thus none of the three Trustees individually controls the decision-making of the Trustees, the Trustees are not considered to separately beneficially own the VF Common Stock held by the Trusts (the “Trust Shares”). As a result, and after considering all other relevant factors related to their roles as Trustees, the Board determined that Ms. Chugg’s and Mr. Otis’s status as Trustees of the Trusts does not give rise to a material relationship with VF other than in their service as directors. During fiscal 2023, VF’s Board of Directors held thirteen meetings. Under VF’s Corporate Governance Principles, directors are expected to attend all meetings of the Board, all meetings of committees of which they are members and the annual meetings of shareholders. Every current member of the Board, since the time of his or her election to the Board, attended at least 75% of the total number of meetings of the Board and all committees on which he or she served during fiscal 2023, and every member of the Board who was a Board member in July 2022 attended the Annual Meeting of Shareholders in July 2022.
Directors’ Compensation
| COMPENSATION ELEMENT | DIRECTOR COMPENSATION PROGRAM | | Annual Retainer | $100,000 | | Annual Equity Retainer | Approximately $180,000(1)(split approximately equally between options and RSUs) | | Committee Fees | None | | Lead Director and Interim Chair Fee | $40,000 | | Talent and Compensation and Audit Committee Chair Fee | $35,000 | | Governance and Corporate Responsibility and Finance Committee Chair Fee | $25,000 | | Meeting Fee for Board meeting in excess of ten meetings during the year | $2,000 per meeting | | Special Assignments in connection with Board or Committee Activity | $1,000 per day per assignment | | Stock Ownership Guidelines | Stock ownership with a fair market value equal to five times the annual retainer(2) |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| DIRECTOR | FEES EARNED OR PAID IN CASH (1) ($) | RSU AWARDS (2) ($) | OPTION AWARDS (3) ($) | ALL OTHER COMPENSATION ($) | TOTAL ($) | | Richard T. Carucci (4) | $138,296 | $90,045 | $90,070 | $ -0- | $318,411 | | Alex Cho (6) | 75,000 | 72,076 | 72,832 | -0- | 219,908 | | Juliana L. Chugg | 135,000 | 90,045 | 90,070 | -0- | 315,115 | | Mark S. Hoplamazian | 100,000 | 90,045 | 90,070 | -0- | 280,115 | | Laura W. Lang | 100,000 | 90,045 | 90,070 | -0- | 280,115 | | W. Alan McCollough (5) | 50,000 | 90,045 | 90,070 | -0- | 230,115 | | W. Rodney McMullen | 117,500 | 90,045 | 90,070 | -0- | 297,615 | | Clarence Otis, Jr. | 117,500 | 90,045 | 90,070 | -0- | 297,615 | | Carol L. Roberts | 125,000 | 90,045 | 90,070 | -0- | 305,115 | | Matthew J. Shattock | 100,000 | 90,045 | 90,070 | -0- | 280,115 |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (1) Messrs. Carucci, Cho, Hoplamazian, McMullen, and Shattock and Ms. Chugg elected to defer all of their cash compensation. |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (2) Each director serving in fiscal 2023 other than Mr. Cho was awarded 1,986 RSUs on May 24, 2022. Mr. Cho was awarded 1,611 RSUs on August 2, 2022. The value in this column is the grant date fair value ($45.34 and $44.74 per RSU for the RSUs awarded on May 24, 2022 and August 2, 2022, respectively) computed in accordance with FASB ASC Topic 718. The assumptions used and the resulting weighted average value of RSUs granted during fiscal 2023 are summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. These RSUs, which are vested and non-forfeitable at grant, remained outstanding on April 1, 2023, and at that date each non-employee director granted RSUs in fiscal 2023 held a total of 1,986 RSUs other than Mr. Cho, who held a total of 1,611 RSUs. RSUs earn dividend equivalents and are settled in shares of VF Common Stock one year after the date of grant. |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (3) Each director serving in fiscal 2023 other than Mr. Cho was awarded options to purchase 6,662 shares of VF Common Stock on May 24, 2022. Mr. Cho was awarded options to purchase 5,403 shares of VF Common Stock on August 2, 2022. The exercise price of the options is $45.34 per share with respect to the options awarded on May 24, 2022 and $44.74 with respect to the options awarded on August 2, 2022. The value in this column is the grant date fair value ($13.52 and $13.48 per option for the options awarded on May 24, 2022 and August 2, 2022, respectively) computed in accordance with FASB ASC Topic 718. The valuation assumptions used and the resulting weighted average value of stock options granted during fiscal 2023 are summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. Options granted to non-employee directors have an exercise price equal to the fair market value of a share of VF Common Stock at the date of grant, are non-forfeitable, have a stated term of ten years and become exercisable one year after the date of grant. Upon a director’s separation from the Board, options are exercisable for 36 months but not after the expiration of the option term. Options to purchase shares of VF Common Stock were outstanding at the end of fiscal 2023 for each non-employee director as follows: Richard T. Carucci, 53,228; Alex Cho, 5,403; Juliana L. Chugg, 53,228; Mark S. Hoplamazian, 47,415; Laura W. Lang, 53,228; W. Rodney McMullen, 41,934; Clarence Otis, Jr., 47,415; Carol L. Roberts, 35,654; and Matthew J. Shattock, 53,228. |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (4) Mr. Carucci was elected as Interim Chair of the Board in December 2022. |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (5) Mr. McCollough did not stand for re-election at the 2022 Annual Meeting. |
FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION
| (6) Mr. Cho was elected to the Board on June 9, 2022. |
Impact of Fiscal 2023 Performance on Incentive Payouts
Impact of Fiscal 2023 Performance on Incentive Payouts Given our overall financial performance in fiscal 2023, the Talent and Compensation Committee (the “Committee”) determined that VF’s performance against pre-established enterprise financial metrics under VF’s Annual Incentive Plan (“AIP”) for fiscal 2023, which was weighted 80% for our executives, resulted in no payout for those enterprise financial metrics. In assessing the remaining 20% weighting of Individual Strategic Objectives under VF’s fiscal 2023 AIP, which focused on People (talent, inclusion, diversity, and equity), Purpose (environmental and social), Culture (employee engagement and high performance culture) and Governance (risk management, behavior, ethics) goals, as well as each executive’s area of accountability, the Committee determined to assess payouts for our NEOs based on financial performance of their areas of accountability only, because VF performed below the minimum pre-established financial thresholds for the VF enterprise financial metrics. Thus, the Committee awarded a payout under the fiscal 2023 AIP only to Mr. Scabbia Guerrini and Ms. Otto to recognize the financial performance of their areas of accountability. Messrs. Puckett and Bailey did not receive any payouts under the fiscal 2023 AIP due to the overall lagging performance results for their areas of accountability. Mr. Dorer was not eligible to participate in the AIP due to the transitional nature of his role as Interim CEO, and Mr. Rendle forfeited any AIP payout as a result of his retirement. The performance payout under VF’s Mid-Term Incentive Plan (“MTIP”) for the fiscal 2021-2023 performance period was at 3% of target. Details of performance achieved against fiscal 2023 AIP goals can be found on page 37 and on page 39 for fiscal 2021-2023 MTIP goals.
Impact of Fiscal 2023 Performance on Incentive Payouts
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
CEO Target and Realizable Compensation
Mr. Rendle retired as our President, CEO and Chair of the Board on December 2, 2022. As a result of his retirement, Mr. Rendle forfeited any payouts with respect to the fiscal 2023 AIP and fiscal 2023-2025 MTIP award opportunities. The stock options granted to Mr. Rendle in fiscal 2023 were also forfeited. As a result, Mr. Rendle’s fiscal 2023 realizable compensation was $943,562, which represents approximately 8% of his fiscal 2023 “total compensation” of $11,485,534 as shown in the Summary Compensation Table on page 49, a decrease of $10,541,972. In the above graphic for Mr. Dorer, “Target Total Compensation” includes pro-ration of annualized base salary, and target long-term incentive award value (time-based restricted stock units (“RSUs”)), and “Realizable Compensation” includes actual base salary received and the fiscal year-end value of his outstanding RSUs, including dividend equivalents. All equity is valued using the $22.91 closing market price of VF’s Common Stock on March 31, 2023, the last trading day of VF’s fiscal 2023. Mr. Dorer was appointed Interim CEO on December 2, 2022. Due to the transitional nature of his role, the Committee approved an annual base salary of $1,300,000 and a time-vesting RSU award with a grant date fair value of $2,000,000. Fifty percent of the award vested on June 2, 2023 and the remaining 50% of the award will vest on December 2, 2023, subject to Mr. Dorer’s continued employment through such date. Time-vesting RSUs were selected as the appropriate equity vehicle, based on the expectation that Mr. Dorer would return to being a non-employee director following his Interim CEO service. The Committee also determined that Mr. Dorer would not participate in our AIP or MTIP for fiscal 2023.
VF’s Compensation Principles
| Pay for Performance | • A significant portion of each executive’s total direct compensation is at-risk, subject to fluctuation based on VF’s financial performance and individual performance(1) • The at-risk components of total compensation targets are annual cash incentives and long-term equity compensation | | Alignment with Business Strategy | • Incentives are designed to motivate VF’s executives by providing payments for achieving and exceeding goals aligned with VF’s annual and long-term business plan and strategic priorities | | Shareholder Value Creation | • Pay is directly linked to the achievement of short-term and long-term performance goals designed to foster the creation of sustainable long-term shareholder value | | Market Competitive Pay | • We provide market-competitive programs that enable VF to attract and retain highly talented individuals • Competitive external peer group data (described on page 46) (the “Peer Group Data”) are used to establish target total direct compensation for each NEO | | Delivery of Individual Strategic Objectives | • Individual goals and metrics focus on progress against key enterprise, brand and/or regional transformational programs, portfolio/function optimization, People (talent, inclusion, diversity, and equity), Purpose (environmental and social), Culture (employee engagement and high performance culture) and Governance (risk management, behavior, ethics) goals applicable to each executive’s area of accountability • All individual performance goals are approved by the Committee and structured around key drivers of VF’s strategic growth plans and value creation model |
Fiscal 2023 Key Compensation Program Designs
| Annual Incentive Plan | Aligned weighting on metrics that measure top line growth, bottom line profitability, and individual performance • Returned to an absolute performance metric for Total Revenue goal • Replaced the Net Income goal with an Operating Income goal to emphasize importance of profit delivery and enhance line of sight for all participants • Eliminated Free Cash Flow Metric and measurement of Net Revenue from any acquired business • Kept maximum payout opportunity of 200% | | Long-Term Incentive Plan | The following changes were made to the PRSUs • Two equally-weighted core metrics to be measured over three fiscal years: Revenue CAGR and Gross Margin Percentage Expansion • Returned to use of TSR against the S&P 500 Consumer Discretionary Index companies as a modifier to core performance results |
Our Governance Practices
| Annual “say-on-pay” advisory vote for shareholders, with robust engagement outreach to understand and respond to feedback | Pay-for-performance emphasis with a balance of short- and long-term incentives, using an array of key performance metrics | | Alignment of executive compensation with shareholder returns through equity ownership and equity-based awards | Robust stock ownership guidelines for executives | | Long-term incentive compensation tied to VF’s TSR relative to S&P 500 Consumer Discretionary Index companies | Clawback provisions for cash and equity performance-based compensation | | “Double trigger” required for severance under change-in-control agreements and for accelerated vesting of equity awards | Compensation consultant to the Committee is independent and free of conflicts of interest |
Our Governance Practices
| No excise tax gross-up payments | No back dating or re-pricing of stock options and stock appreciation rights | | No hedging or pledging of VF Common Stock | No employment agreements for U.S.-based executive officers | | | None of the NEOs have contractual rights to receive separation payments if they terminate their employment or are terminated with or without cause prior to a change in control of VF |
Components of our Programs for Fiscal 2023
| TYPE | COMPONENT | TERMS | OBJECTIVE | PERFORMANCE/ VESTING PERIOD | | Fixed Compensation | Annual Base Salary – Cash | • Fixed pay reflective of an executive’s role, responsibilities and individual performance • Reviewed annually | • Competitively compensate executives for their level of responsibility, skills, experience and sustained individual contribution | N/A | | Performance- Based Compensation | Annual Incentive Awards – Cash | • Variable, performance-based cash compensation earned based on achieving pre-established annual goals • Annual payouts range from 0% to 200% of the targeted incentive opportunity | • Link compensation to annual operating and strategic performance objectives | One Year | | | Long-term Equity Incentive Awards – PRSUs – Weighted 50% of Total Long-Term Equity Incentives | • Variable, performance-based equity compensation earned based on achieving pre-established financial goals and relative TSR over a three-year performance period • Payouts range from 0% to 200% of the targeted incentive opportunity based on financial performance (further modified up to +/- 25% based on the relative TSR modifier) • Generally vest at the end of the three-year performance period • Dividend equivalent units accumulate during the vesting period and are only paid on earned shares • Paid in shares of VF Common Stock upon vesting | • Link rewards to long-term operating performance and relative TSR • Link rewards to shareholder value creation through stock price growth • Aid in retention | Three Years | | | Long-term Equity Incentive Awards – Stock Options – Weighted 50% of Total Long-Term Equity Incentives | • Generally vest one third each year for three years, with each vesting occurring on the anniversary of the grant date • Expire after ten years • Granted at fair market value | • Link rewards to shareholder value creation through stock price growth • Aid in retention | Up to Ten Years |
MR. DORER’S APPOINTMENT TO INTERIM PRESIDENT AND CHIEF EXECUTIVE OFFICER
MR. DORER’S APPOINTMENT TO INTERIM PRESIDENT AND CHIEF EXECUTIVE OFFICER Immediately following the retirement of Mr. Rendle, Mr. Dorer, the Lead Director of our Board, was appointed as our Interim CEO effective December 2, 2022. In consideration for Mr. Dorer’s service as Interim CEO while the search for a permanent CEO is ongoing, the Board approved an annual base salary of $1,300,000 and a time-vesting RSU award with a grant date fair value of $2,000,000. Fifty percent of the RSU award vested on June 2, 2023 and the remaining 50% of the RSU award will vest on December 2, 2023, subject to Mr. Dorer’s continued employment. Time-vesting RSUs were selected as the appropriate equity vehicle, based on the expectation that Mr. Dorer would return to being a non-employee director following his Interim CEO service. During his service as our Interim CEO, Mr. Dorer also receives corporate housing near VF’s global headquarters in Denver, Colorado and commuting benefits between his home in California and Denver. Mr. Dorer’s compensation for fiscal 2023 is reflected in the Summary Compensation Table on page 49. While Mr. Dorer continues to serve as a member of our Board, he does not receive any compensation in addition to his regular employment compensation for service on the Board and attendance at meetings of the Board or any of its committees.
MS. OTTO’S APPOINTMENT TO GLOBAL BRAND PRESIDENT, THE NORTH FACE
MS. OTTO’S APPOINTMENT TO GLOBAL BRAND PRESIDENT, THE NORTH FACE Ms. Otto’s appointment to Global Brand President, The North Face effective May 31, 2022 was part of VF’s succession plan in response to Steve Murray’s planned retirement on June 30, 2022. Ms. Otto’s compensation package includes an annual base salary of $625,000, a cash sign-on bonus of $500,000, payable in two installments (one in fiscal 2023 and one in fiscal 2024), an AIP target of 100% of base salary, pro-rated as of her employment start date, a long-term incentive plan award with a target value of $1,000,000, a one-time increase to her long-term incentive plan target award of $1,000,000 (resulting in a fiscal 2023 target long-term incentive plan award with a target value of $2,000,000), and a time-vesting restricted stock award with a grant date fair value of $2,500,000. The restricted stock award will vest in four equal tranches at each of the next four anniversaries of the grant date, as long as she remains employed by VF at the applicable vesting date, subject to certain other terms and conditions. The one-time increase to her fiscal 2023 long-term incentive plan target award and the grant of the restricted stock award was intended to compensate Ms. Otto for awards that she forfeited from her prior employer upon accepting our employment offer. Ms. Otto’s compensation for fiscal 2023 is included in the Summary Compensation Table on page 49.
FISCAL 2023 COMPENSATION DECISIONS
FISCAL 2023 COMPENSATION DECISIONS For fiscal 2023, the portions of target total direct compensation for each of the compensation elements for the NEOs were as follows. Mr. Dorer’s target compensation mix reflects the transitional nature of his appointment as our Interim CEO and consists of base salary and time-vesting RSUs. The Committee determined that Mr. Dorer would not participate in our AIP nor receive any long-term performance-based incentive compensation. Ms. Otto’s target compensation mix excludes a cash sign-on bonus, a sign-on restricted stock award and a one-time increase to her long-term incentive award target in fiscal 2023, which was intended to compensate Ms. Otto for incentive-based awards that she forfeited from her prior employer upon accepting our employment offer. Messrs. Bailey and Scabbia Guerrini’s target compensation mix excludes the special equity awards granted to them, as described below in the section entitled “Elements of Compensation – Retention and Special Awards.”
BASE SALARY
BASE SALARY Base salary is designed to compensate executives for their level of responsibility, skills, experience and sustained individual contribution. Base salary is intended to be targeted around median salary levels for equivalent executive positions at companies in the compensation peer group (as described on page 46, the “Peer Group”). The Committee believes that a base salary targeted around comparable median salary levels within the Peer Group provides the foundation for the total compensation package required to attract, retain and motivate executives in alignment with VF’s business strategies. Individual salaries for the NEOs are reviewed by the Committee annually, as well as at the time of a promotion or other changes in responsibilities. Each NEO is evaluated annually based on several components: key job responsibilities, key accomplishments and performance against annual goals and objectives. The resulting performance evaluations are presented to the Committee to be used in assessing each component of total compensation for each NEO. Annual base salary increases for each NEO are based on (i) individual specific characteristics, including tenure in position and an assessment of the individual’s performance, (ii) the range around the median comparable salary of the Peer Group for the individual’s position, and (iii) VF’s overall merit increase budget for salaries. In addition, the Committee considers substantial increases in an executive’s responsibilities in setting base salary increases. Generally, base salaries of the NEOs are approved by the Committee and, in the case of the CEO’s base salary, approved by the full Board.
ANNUAL INCENTIVE AWARDS
ANNUAL INCENTIVE AWARDS VF maintains the AIP as a cash incentive plan for the NEOs. The AIP focuses executive attention on annual VF performance as measured by pre-established goals. The incentives are designed to motivate VF’s executives by providing payments for achieving and exceeding goals related to VF’s annual business plan and strategic priorities. The AIP framework also applies to all eligible participants, including employees who are not NEOs, and payouts as a percentage of target for all eligible participants are aligned with such payouts for the NEOs. The Committee used the competitive external Peer Group Data described below to assist it in establishing targeted awards for each NEO under the AIP. The Committee establishes each NEO’s targeted annual incentive opportunity under the AIP after consideration of compensation data and the recommendations of the CEO (with respect to the NEOs other than the CEO) and the Committee’s independent consultant. The Committee also makes a general assessment as to the relative amounts of annual incentives for the NEOs to make sure they are, in the Committee’s judgment, fair and reasonable. The annual cash incentive targets from fiscal 2022 to fiscal 2023 for the NEOs, as well as the fiscal 2023 payout range, are set forth below (except for Mr. Dorer who did not participate in the AIP in fiscal 2023 due to the interim nature of his employment):
ANNUAL INCENTIVE AWARDS
| EXECUTIVE | FY2022 ANNUAL CASH INCENTIVE TARGET AS % OF ANNUAL BASE SALARY(1) | FY2023 ANNUAL CASH INCENTIVE TARGET AS % OF ANNUAL BASE SALARY(2) | FY2023 PAYOUT % OPPORTUNITY | | Mr. Puckett | 100% | 100% | 0 – 200% | | Mr. Bailey | 100% | 100% | 0 – 200% | | Mr. Scabbia Guerrini | 100% | 100% | 0 – 200% | | Ms. Otto(3) | n/a | 100% | 0 – 200% | | Mr. Rendle(4) | 200% | 200% | 0 – 200% |
ANNUAL INCENTIVE AWARDS
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
ANNUAL INCENTIVE AWARDS
| (1) In fiscal 2022 the Committee took steps to convert incentive targets previously expressed as lump sum amounts to a percentage of base salary. In addition, the Committee aligned those percentages of base salary utilizing the Peer Group Data. |
ANNUAL INCENTIVE AWARDS
| (2) The target award amounts are set forth in the 2023 Grants of Plan-Based Awards table below. |
ANNUAL INCENTIVE AWARDS
| (3) Ms. Otto’s Annual Incentive Target rate of 100% of base salary was effective May 31, 2022 in connection with her appointment to Global Brand President, The North Face. |
ANNUAL INCENTIVE AWARDS
| (4) Due to his retirement effective December 2, 2022, Mr. Rendle was not eligible for a fiscal 2023 AIP payout pursuant to the terms of the AIP. |
Fiscal 2023 Performance Goals and Metrics
Fiscal 2023 Performance Goals and Metrics Under the AIP, performance goals are set each year by the Committee. Taking into consideration the continued impact of the COVID-19 pandemic on our business, primarily driven by zero-tolerance policies in China and supply chain disruptions in other Asian countries, counter-balanced by stronger consumer sentiment and increased retail foot traffic in other countries in spite of inflation concerns, for fiscal 2023 the Committee made changes to VF’s compensation programs as described below. Changes made to VF’s AIP performance goals for fiscal 2023 were made to both simplify and drive a focus on absolute performance. VF’s Mid-Term Incentive Plan continues to maintain a direct link to relative performance through TSR. The emphasis on absolute financial goals focused on revenue, operating income, and gross margin, coupled with TSR linkage, aligns executives with our short and long-term strategic priorities, which support long-term shareholder value creation.
Fiscal 2023 Performance Goals
Fiscal 2023 Performance Goals In summary, the Committee chose the following absolute goals as the most impactful drivers of VF’s strategic growth plans and its return to business and earnings growth for fiscal 2023:
Fiscal 2023 Performance Goals
| | FISCAL 2023 GOAL | EXPLANATION | RATIONALE | | | Total Revenue(1) | Measures VF’s total revenue performance against absolute targets set in relation to VF’s fiscal 2023 financial plan. | Key measure of top line growth. | | | Operating Income(2) | Measures profit from business operations. | Indicates profitability of the company. | | | Individual Strategic Objectives | Individual goals and metrics focused on progress against key enterprise, region and/or brand transformational programs, portfolio/function optimization, People (talent, inclusion, diversity, and equity), Purpose (environmental and social), Culture (employee engagement and high performance culture) and Governance (risk management, behavior, ethics) goals applicable to each executive’s area of accountability. | Performance goals approved by the Committee structured around key drivers of VF’s strategic growth plans and value creation model. | | | EMEA and Emerging Brands Goals – Total Revenue and Operating Income Ratio(3) | Measures EMEA and Emerging Brands total revenue and operating income ratio performance against absolute targets set in relation to VF’s fiscal 2023 financial plan. | Key measure of top line growth and profitability for a region and brands critical to VF’s strategic growth plans and value creation model. | | | Global The North Face® Goals – Total Revenue, Gross Margin Ratio and Operating Income Ratio(4) | Measures The North Face® total revenue, gross margin ratio and operating income ratio performance against absolute targets set in relation to VF’s fiscal 2023 financial plan. | Key measure of top line growth and profitability for a brand critical to VF’s strategic growth plans and value creation model. |
Fiscal 2023 Performance Goals
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
Fiscal 2023 Performance Goals
| (1) Total Revenue is based on VF’s continuing operations and is measured on a constant currency basis, which is a non-GAAP financial measure that excludes the impact of translating foreign currencies into U.S. dollars. To calculate measures on a constant currency basis, the amounts in the current year for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the foreign exchange rates used in VF’s fiscal 2023 financial plan at the time the Committee set the targets. |
Fiscal 2023 Performance Goals
| (2) Operating Income is based on VF’s continuing operations and reflects the impact of non-GAAP adjustments, which during fiscal 2023 include (i) noncash impairment charges related to the Supreme® reporting unit goodwill and indefinite-lived trademark intangible asset, (ii) costs related to VF’s business model transformation, primarily driven by Corporate actions and resulting restructuring costs, and a transformation initiative for our Asia-Pacific regional operations, and (iii) transaction and deal related activities associated with the acquisition of the Supreme® brand. Operating Income is also measured on a constant currency basis, which is a non-GAAP financial measure that excludes the impact of translating foreign currencies into U.S. dollars. To calculate measures on a constant currency basis, the amounts in the current year for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the foreign exchange rates used in VF’s fiscal 2023 financial plan at the time the Committee set the targets. |
Fiscal 2023 Performance Goals
| (3) These performance objectives were applicable to Mr. Scabbia Guerrini, as further described under “Performance Against Individual Strategic Objectives” in this section. |
Fiscal 2023 Performance Goals
| (4) These performance objectives were applicable to Ms. Otto, as further described under “Performance Against Individual Strategic Objectives” in this section. |
Fiscal 2023 Performance Goals
The Committee established target performance goals as described below to determine the actual payouts to the executives. While it is the policy of the Committee to provide opportunities for annual incentive compensation for achievement of pre-established performance goals based primarily on financial measures, the Committee also retains discretion to pay bonuses apart from the AIP reflecting its subjective assessment of the value of accomplishments of VF’s executive officers which, in the Committee’s view, cannot always be anticipated in advance or reflected in such pre-established goals. As shown in the chart below, the Committee aligned the performance goals for all NEOs based on VF Enterprise goals and Individual Strategic Objectives. As it does each year, the Committee chose weightings that are intended to strike an appropriate balance between aligning each executive’s individual objectives with VF’s overall corporate objectives while holding the executive accountable for performance in the executive’s particular area of responsibility. As a key differentiating part of VF’s operating model, our regionally and/or brand based NEOs each drive enterprise financial results and strategic priorities beyond their direct region/brand area(s) of accountability. They bring the unique capability to transition from one leadership role to another, operating with both an enterprise and region or brand mindset. For this reason, for fiscal 2023 the Committee made the decision to hold all NEOs accountable to VF Enterprise performance goals, recognizing their significant impact on overall VF operating results. In May 2022, the Committee set target performance goals for fiscal 2023 for the NEOs after considering criteria and weightings recommended by management as well as advice from the Committee’s independent consultant. Ms. Otto’s weightings and individual strategic objectives were approved by the Committee following her appointment as Global Brand President, The North Face. Due to the transitional nature of Mr. Dorer’s appointment as Interim CEO on December 2, 2022, the Committee did not grant Mr. Dorer an award opportunity under the AIP and therefore did not set performance goals for purposes of the AIP for Mr. Dorer.
Fiscal 2023 Performance Goals
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
Fiscal 2023 Performance Goals
The objectives for the VF Performance Targets and each component of the objectives:
Fiscal 2023 Performance Goals
| (1) exclude the effects of adjustments related to impairment charges, pension curtailment or settlement charges, restructuring charges, other extraordinary items or non-recurring items, and required changes in accounting policies, |
Fiscal 2023 Performance Goals
| (2) are calculated based on continuing operations, and |
Fiscal 2023 Performance Goals
| (3) using the Company’s long-standing methodology, exclude any difference between actual foreign exchange rates and the foreign exchange rates used in VF’s fiscal 2023 financial plan at the time the Committee set the targets. |
Fiscal 2023 Performance Goals
The performance targets were set in alignment with VF’s strategy to deliver consistent, profitable growth that provides sustainable, long-term returns for VF’s shareholders while considering the shorter-term reality of continuing global industry disruption as a result of the impact of COVID-19 on the global economy and VF’s business. The targets reflected a number of factors, including the impacts of recent acquisitions and planned synergies, VF’s strategic growth plan and value creation model and long-term commitments to our shareholders as outlined in our strategic 2023 plan.
Fiscal 2023 Performance Summary
| (1) Mr. Rendle was not eligible for a fiscal 2023 AIP award payout and Mr. Dorer did not participate in the fiscal 2023 AIP. |
Performance Against Individual Strategic Objectives
| (1) Ms. Otto’s fiscal 2023 earned annual incentive award was calculated on a pro-rata basis for her time in her role in fiscal 2023. |
PERFORMANCE-BASED RESTRICTED STOCK UNITS
PERFORMANCE-BASED RESTRICTED STOCK UNITS Under the MTIP, executives are awarded PRSUs that give them the opportunity to earn shares of VF Common Stock for performance achieved over three-year cycles. PRSUs provide long-term incentive compensation for executives with the objectives of providing a focus on long-term value and increasing stock ownership. PRSUs are designed to align the interests of VF’s executives with those of shareholders by encouraging the executives to enhance the value of VF Common Stock. In addition, through three-year performance periods, this component of the program is designed to create an incentive for individual executives to remain with VF. Dividend equivalents are paid on the shares actually paid out under the MTIP (no dividend equivalents are paid on any portion of the MTIP award not earned). At the payout date, the cash value of dividend equivalents is converted into additional shares.
Fiscal 2021 – 2023 Performance-Based Awards and Results
| FY2021-2023 PERFORMANCE GOALS | WEIGHTING | | 3-Year Revenue CAGR vs Performance Peer Set | 50% | | 3-Year TSR vs S&P 500 Consumer Discretionary Index* | 50% |
Fiscal 2021 – 2023 Performance-Based Awards and Results
| * Also represents a Compensation Peer Group company for compensation data (see page 46 for additional information about the Compensation Peer Group). |
Fiscal 2021 – 2023 Performance-Based Awards and Results
For purposes of measuring relative business performance, the Committee chose the 16 apparel and/or footwear companies with which VF competes most for a share of consumer spending. Not all of the companies in the Performance Peer Set meet the size criteria (revenue and market capitalization) used in selecting the Compensation Peer Group as described on page 46, and are therefore excluded from the Compensation Peer Group on that basis. Payout under the plan is calculated as follows: The participant’s target number of PRSUs is multiplied by the payout percentage corresponding to the level of achievement against the three-year performance goals established at the beginning of the three-year performance cycle by the Committee (between 0% and 200% of the participant’s target award). The second component, a three-year Gross Margin Rate Improvement target, modifies performance by a maximum additional 25% or a maximum reduction of 25% on a straight-line interpolated basis. As a result of including this growth performance metric modifier, actual payouts may range from 0% to 225% of the targeted award. An additional number of shares equal to the dollar value of the dividends that would have accrued (without compounding) are added to the shares subject to the payout. In May 2023, in determining the results for the fiscal 2021-2023 performance period, the Committee considered achievement against the three-year performance goals (above) that were established in July 2020 for the performance cycle. The global uncertainty and disruption driven by the COVID-19 pandemic negatively impacted the first half of the performance cycle, resulting in below target achievement for Revenue growth relative to the Performance Peer Set. VF’s TSR for the performance period was below the 25th percentile of the S&P 500 Consumer Discretionary Index companies,
Fiscal 2022-2024 Performance Based Awards
| FY2022-2024 PERFORMANCE GOALS | WEIGHTING | | 3-Year Revenue CAGR vs Performance Peer Set | 50% | | 3-Year TSR vs S&P 500 Consumer Discretionary Index* | 50% |
Fiscal 2023-2025 Performance Based Awards
| FY2023-2025 PERFORMANCE GOALS | WEIGHTING | RATIONALE | | 3-Year Revenue CAGR | 50% | Metric that focuses on accelerated top-line growth and enhanced shareholder returns | | 3-Year Gross Margin Percentage Expansion | 50% | Metric used to measure revenue growth and equity of VF’s brands |
Fiscal 2023-2025 Performance Based Awards
| (2) The payout will be modified as described above. |
STOCK OPTIONS
STOCK OPTIONS Stock options awarded under the 1996 Stock Compensation Plan, as amended and restated as of February 10, 2015 (the “Stock Plan”), are intended to align executives’ and shareholders’ interests and focus executives on attainment of VF’s long-term goals. Stock options provide executives with the opportunity to acquire an equity interest in VF and to share in the appreciation of the value of the stock. They also provide a long-term incentive for the executive to remain with VF and promote shareholder returns. The Committee determines a value of options awarded to NEOs as a component of the target total direct compensation. Non-qualified stock options have a term of not greater than ten years and become exercisable not less than one year after the date of grant. Options are exercisable only so long as the option holder remains an employee of VF or its subsidiaries, except that, subject to earlier expiration of the option term, and to the specific terms and definitions contained in the Stock Plan, options generally remain exercisable for the period severance payments are made (if any) in the case of involuntary termination of employment, and for 36 months after death, retirement or termination of employment due to disability, provided that such continued vesting after retirement requires that the employee was employed by VF on the last day of the fiscal year in which the option was granted, as well as compliance with restrictive covenants in the event of retirement. In addition, in accordance with certain executives’ Change-in-Control Agreements described below, upon an executive’s qualifying termination of employment following a change in control of VF, any unvested options are accelerated and become exercisable by the executive.
RETENTION AND SPECIAL AWARDS
RETENTION AND SPECIAL AWARDS Retention awards of restricted stock or RSUs are made by the Committee from time to time to attract key executives, particularly to compensate for forfeited awards from prior employment, and to encourage key employees in critical roles to remain engaged and employed with VF during challenging and uncertain times. Awards of restricted stock or RSUs for retention purposes under the Stock Plan are not part of regular annual compensation, and are not treated as part of total direct compensation. The Committee is committed to using retention and special awards sparingly, and only after thoughtful consideration of the circumstances, including the criticality of the key employee, the retentive value of the employee’s outstanding equity awards, and a fulsome review of all other regular compensation actions that are available to the Committee. On August 2, 2022, the Committee granted Ms. Otto a special award of 55,879 shares of restricted stock that will vest 25% at each of the next four anniversaries of the grant date, so long as she remains employed by VF until the applicable vesting date. This award was made to compensate Ms. Otto for awards that she forfeited from her prior employer as a result of her decision to join VF as Global Brand President, The North Face. In consideration for Mr. Dorer’s service as Interim CEO, the Board approved a time-vesting RSU award with a grant date fair value of $2,000,000. Fifty percent of the RSU award vested on June 2, 2023 and the remaining 50% of the RSU award will vest on December 2, 2023, subject to Mr. Dorer’s continued employment. Time-vesting RSUs were selected as the appropriate equity vehicle, based on the expectation that Mr. Dorer would return to being a non-employee director following his Interim CEO service. In addition, the unvested portion of Mr. Dorer’s RSU award will be prorated if his employment terminates prior to the remaining vesting date due to his resignation upon the appointment of a permanent President and Chief Executive Officer or his involuntary termination of employment not for cause. In the event of Mr. Dorer’s death or disability, the RSU award would fully vest. On February 10, 2023, after consulting with the Committee’s independent consultant and the Interim CEO, the Committee granted Mr. Bailey an award of 26,198 RSUs, 50% of which will vest on February 10, 2025 and 50% of which will vest on February 10, 2027, so long as he remains employed by VF until the applicable vesting date (except that a pro
RETENTION AND SPECIAL AWARDS
rata portion of the award would vest in the event of involuntary termination of his employment not for cause). The retention award to Mr. Bailey was approved by the Committee on account of Mr. Bailey’s critical responsibilities as Global Brand President, Vans®, one of VF’s largest brands, and the importance of assuring that the right executive, who had successfully led that brand previously, is retained in this vital role and to retain a key executive during a uniquely challenging and competitive market for talent. On March 6, 2023, after consulting with the Committee’s independent consultant and the Interim CEO, the Committee granted Mr. Scabbia Guerrini an award of 78,248 RSUs, 50% of which will vest on March 6, 2025 and 50% of which will vest on March 6, 2027, so long as he remains employed by VF until the applicable vesting date (except that a pro rata portion of the award would vest in the event of involuntary termination of his employment not for cause). The retention award to Mr. Scabbia Guerrini was approved by the Committee and is intended to incentivize Mr. Scabbia Guerrini for his increased responsibility for the APAC region, which is an important part of VF’s growth strategy, to recognize the importance of sustaining performance in EMEA and to retain a key executive during a uniquely challenging and competitive market for talent. For both Messrs. Bailey and Scabbia Guerrini, these special awards were further intended by the Committee to retain high-performing leaders of key VF brands and regions during a period of significant transition and uncertainty while the search for a permanent CEO is ongoing. The size of the special RSU awards for each of Messrs. Bailey and Scabbia Guerrini was determined by the Committee following consideration of compensation data from VF’s Compensation Peer Group collected by the Committee’s independent compensation consultant, as well as the Committee’s assessment of each executive’s scope of accountability, relative importance to VF’s long-term strategy and the retentive power of each executive’s aggregate unvested equity awards. Each of the RSU awards granted to Messrs. Bailey and Scabbia Guerrini would vest in full if the executive’s employment termination is due to the executive’s death or disability and the full amount of such award would vest upon a termination of the executive’s employment within 24 months after a change in control of VF, either by VF not for cause or by the executive for good reason.
COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP
COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP The Committee’s consultant and management each independently utilized the Peer Group Data to assist in establishing compensation targets for fiscal 2023.
COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP
| • | The Peer Group Data was compiled utilizing publicly reported salary and go-forward salary levels and target levels of performance-based compensation available as of February 2022. |
COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP
| • | The Committee’s consultant utilized all data to recommend compensation targets for the Chief Executive Officer, and the Chief Executive Officer utilized the data to recommend compensation targets for the other NEOs. |
COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP
In addition, the Committee utilizes the Peer Group to evaluate whether executive officer pay levels are reasonable on a relative basis.
PEER GROUP
PEER GROUP The Committee primarily identifies companies that are of comparable size (based on revenue and market capitalization), and meet a majority of several criteria, such as:
PEER GROUP
| • | having significant (greater than 30%) non-US revenue, |
PEER GROUP
| • | having similar products and/or customers, |
PEER GROUP
| • | having a significant number of brands (at least 10, excluding licensed brands to the extent possible), |
PEER GROUP
| • | considering VF as a compensation peer, |
PEER GROUP
| • | being a frequent peer of peers being listed as a compensation peer in at least four other current peer companies, and |
PEER GROUP
| • | being a 2022 peer company identified by ISS, a leading independent proxy advisory firm. |
PEER GROUP
The Committee reviewed the composition of the fiscal 2022 Peer Group and determined to make no changes to the Peer Group for fiscal 2023. The fiscal 2023 Peer Group constituent companies are grouped into the following business types: The Committee sets target total direct compensation (base salary, target annual cash incentive awards and target annual long-term equity incentive award values) for senior executives generally around the median of the Peer Group Data, with targeted rigorous performance goals established by the Committee and the expectation that high performance results in upper quartile rewards. For fiscal 2023, the target total direct compensation was set in a reasonable range around the median of the Peer Group for each NEO. Positioning total compensation at median is intended to retain top talent at a reasonable cost to VF as indicated by the available data, as well as to recognize each NEO’s relative experience to perform in his or her role. The Committee considers the scope of the executive’s duties, the executive’s experience in his or her role and individual performance relative to his or her peers to establish the appropriate point within that range of market data, or outside the range under circumstances that justify a deviation. The Committee also considers historical compensation levels, relative
PEER GROUP
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
PEER GROUP
compensation levels among VF’s senior executives, and VF’s corporate performance as compared to the performance of companies in the Peer Group. The Committee generally allocates between total cash compensation and equity compensation in a way intended to be competitive with the Peer Group. The Committee balances the elements of total direct compensation in this process.
Change-In-Control Agreements
Change-In-Control Agreements VF has entered into Change-in-Control Agreements (the “Agreements”) with certain VF senior executives, including Messrs. Puckett, Bailey and Scabbia Guerrini, that provide the executives with certain severance benefits in the event their employment with VF is terminated by VF or by the executive for good reason, as defined in the Agreements, subsequent to a change in control of VF. The Agreements are designed to reinforce and encourage the continued attention and dedication of such executives to their assigned duties without distraction in the face of the potentially disturbing circumstances arising from the possibility of a change in control of VF. VF believes that change-in-control arrangements are an important component of a competitive compensation package necessary to attract and retain qualified senior executives. The Agreements are described and quantified below in the “Potential Payments Upon Change in Control, Retirement or Termination of Employment” section. Total payments to be made to an executive in the event of termination of employment upon a change in control of VF may constitute excess “parachute payments” (as that term is defined in the Code). During 2011, the Committee eliminated the gross up feature.
Change-In-Control Agreements
| EXECUTIVE COMPENSATION | | Compensation Discussion and Analysis |
Change-In-Control Agreements
Under the terms of the Agreements, the executives would also be entitled to supplemental benefits, such as accelerated rights to exercise stock options, accelerated lapse of restrictions on restricted stock and restricted stock units, lump sum payments under the SERP, and continued life and medical insurance for specified periods after qualifying termination. Upon a change in control of VF, VF would also pay all reasonable legal fees and related expenses incurred by the executive as a result of the termination of his or her employment or in obtaining or enforcing any right or benefit provided by the Agreements.
Summary Compensation Table
Summary Compensation Table The following table sets forth all compensation paid or awarded to our NEOs during fiscal year 2023 (“fiscal 2023”), fiscal year 2022 (“fiscal 2022”) and fiscal year 2021 (“fiscal 2021”). Totals may not add up due to rounding.
Summary Compensation Table
| NAME AND PRINCIPAL POSITION | YEAR | SALARY ($) (1) | BONUS ($) (2) | STOCK AWARDS ($) (3) | OPTION AWARDS ($) (4) | NON-EQUITY INCENTIVE PLAN COMPENSATION ($) (5) | CHANGE IN PENSION VALUE AND NONQUALIFIED DEFERRED COMPENSATION EARNINGS ($) (6) | ALL OTHER COMPENSATION ($) (7) | TOTAL ($) | | Benno Dorer,(8) | 2023 | $427,397 | $-0- | $2,000,001 | $-0- | $-0- | $-0- | $610,168 | $3,037,566 | | Interim President and | | | | | | | | | | | Chief Executive Officer | | | | | | | | | | | Matthew H. Puckett,(9) | 2023 | 700,000 | -0- | 1,076,333 | 1,000,656 | -0- | -0- | 89,214 | 2,866,203 | | Executive Vice President and Chief Financial Officer | 2022 | 579,058 | | 1,037,661 | 901,768 | 647,117 | -0- | 60,536 | 3,226,140 | | Kevin D. Bailey,(1) (10) | 2023 | 700,000 | -0- | 2,153,079 | 1,350,878 | -0- | -0- | 141,674 | 4,345,631 | | Global Brand President, | 2022 | 630,000 | -0- | 1,441,087 | 1,252,461 | 569,520 | -0- | 86,494 | 3,979,562 | | Vans | 2021 | 579,082 | -0- | 1,334,766 | 1,049,260 | 640,800 | -0- | 613,727 | 4,217,635 | | Martino Scabbia Guerrini,(1) | 2023 | 764,224 | -0- | 3,345,435 | 1,250,816 | 134,198 | 132,462 | 31,406 | 5,658,541 | | Executive Vice President | 2022 | 739,789 | -0- | 3,385,587 | 1,252,461 | 800,157 | 127,818 | 32,664 | 6,338,475 | | and Group President, | 2021 | 679,519 | -0- | 1,334,766 | 1,049,260 | 658,038 | 123,578 | 32,503 | 3,877,665 | | EMEA, APAC and Emerging Brands | | | | | | | | | | | Nicole Otto,(11) | 2023 | 522,260 | 250,000 | 3,563,126 | 1,000,656 | 99,438 | -0- | 48,791 | 5,484,271 | | Global Brand President, | | | | | | | | | | | The North Face | | | | | | | | | | | Steven E. Rendle,(12) | 2023 | 943,562 | -0- | 5,139,421 | 4,778,076 | -0- | -0- | 624,475 | 11,485,534 | | Former President and | 2022 | 1,400,000 | -0- | 5,505,021 | 4,784,350 | 3,214,400 | -0- | 519,383 | 15,423,153 | | Chief Executive Officer | 2021 | 1,089,863 | -0- | 5,911,008 | 4,646,721 | 2,892,000 | 899,800 | 343,014 | 15,782,405 |
Summary Compensation Table
| (1) The cash compensation for Mr. Bailey is paid in U.S. dollars, other than certain perquisites which were paid in Hong Kong dollars in fiscal 2021. The perquisites compensation was converted into U.S. dollars at the average daily exchange rate in fiscal 2021 of 0.1290 U.S. dollars to the Hong Kong dollar. The cash compensation for Mr. Scabbia Guerrini is paid in Swiss francs. His cash compensation was converted into U.S. dollars at the average daily exchange rate for each respective period, as follows: in fiscal 2021, 1.0834 U.S. dollars to the Swiss franc, in fiscal 2022, 1.0888 U.S. dollars to the Swiss franc and in fiscal 2023, 1.0469 U.S. dollars to the Swiss franc. |
Summary Compensation Table
| (2) Ms. Otto received a cash sign-on bonus of $500,000, payable in two installments. The first $250,000 was paid within 30 days of her start date and the second installment of $250,000 will be payable within 30 days of the one-year anniversary of her start date, subject to her continued employment on such date (which will occur in fiscal 2024). If Ms. Otto voluntarily resigns from VF within the first or second year of her employment with VF, she will be required to pay back the first or second installment of the bonus award, as applicable. |
Summary Compensation Table
| (3) The amounts shown for the restricted stock units in this column include the aggregate grant date fair value of the restricted stock unit awards computed in accordance with FASB ASC Topic 718. The valuation assumptions used are summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. Awards of performance-based restricted stock units (“PRSUs”) for the three-year performance periods of 2021 through 2023, 2022 through 2024 and 2023 through 2025 were made to the named executive officers in 2020, 2021 and 2022, respectively, under the Mid-Term Incentive Plan generally described in footnote 3 to the 2023 Grants of Plan-Based Awards Table below. The grant date fair value of the PRSUs granted in fiscal 2023 is the sum of two separate valuations, the larger portion being the target payout based on the probable outcome of financial performance goals and the remaining portion being the fair value of the awards based on relative total shareholder return. To calculate this, we (i) multiply the average of the high and the low price of VF Common Stock on the date of the award ($45.34) by the target number of PRSUs to determine the portion of fair value based on the financial performance goal, and (ii) use a Monte Carlo simulated fair value to determine the portion of fair value based on relative total shareholder return ($3.46 per PRSU at target). Assuming achievement of the financial performance goals at the maximum level, the grant date fair value of the PRSU awards granted in 2022 with respect to fiscal 2023 compensation would have been as follows: Mr. Puckett, $2,076,352; Mr. Bailey, $2,803,113; Mr. Scabbia Guerrini, $2,595,440; Ms. Otto, $2,076,352; and Mr. Rendle, $9,914,448 (these amounts include the relative total shareholder return portion of grant date fair value, but that portion of fair value is not based on an assumed probable level of performance so does not change when fair value is shown assuming maximum performance). Dividend equivalents (without compounding) accrue on these PRSUs subject to the same performance-based vesting requirements as apply to the PRSUs. The amount for Mr. Dorer includes a time-vesting RSU award, 50% of which vested on June 2, 2023 and 50% of which will vest on December 2, 2023, subject to continued employment through such date. The fair value of the RSUs was calculated by multiplying the average of the high and the low price of VF Common Stock on the date of the award ($29.42) by the number of RSUs granted. Vesting, forfeiture and other terms of this award are described in the Compensation Discussion and Analysis above. In connection with his retirement on December 2, 2022, Mr. Rendle forfeited his fiscal 2023 equity awards. The amount for Messrs. Bailey and |
Summary Compensation Table
| EXECUTIVE COMPENSATION | | Summary Compensation Table |
Summary Compensation Table
| Scabbia Guerrini also includes a retention award of 26,198 RSUs and 78,248 RSUs, respectively, of which 50% will vest two years after the grant date and the remaining 50% will vest four years after the grant date, subject to continued employment through the applicable vesting date. The fair value of the RSUs was calculated by multiplying the average of the high and the low price of VF Common Stock on the date of the award ($26.72 and $25.56 respectively) by the number of RSUs granted. This amount for Ms. Otto also includes a special award in connection with her appointment to Global Brand President, The North Face of 55,879 RSAs, of which 25% will vest on each annual anniversary of the grant date for four years. The fair value of the RSAs was calculated by multiplying the average of the high and the low price of VF Common Stock on the date of the award ($44.74) by the number of RSAs granted. Vesting, forfeiture and other terms of those awards are described in the Compensation Discussion and Analysis above. |
Summary Compensation Table
| For a discussion of the performance goals applicable to the PRSU awards, as well as vesting, forfeiture and other terms, see the Compensation Discussion and Analysis above. |
Summary Compensation Table
| (4) Options to purchase shares of VF Common Stock are granted under the Stock Plan. The terms of options granted under the Stock Plan are described in footnote 1 to the Outstanding Equity Awards at Fiscal Year-End 2023 table below. The values of the option awards in this column are the aggregate grant date fair value computed in accordance with FASB ASC Topic 718 and were estimated using a lattice option-pricing model, which incorporates a range of assumptions for inputs between the grant date of the option and date of expiration. The valuation assumptions used and the resulting weighted average value of stock options granted during fiscal 2023 is summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. In connection with his retirement on December 2, 2022, Mr. Rendle forfeited his fiscal 2023 equity awards. |
Summary Compensation Table
| (5) The amounts in this column represent cash awards earned under the AIP. The general operation of the AIP in fiscal 2023 is described in footnote 2 to the 2023 Grants of Plan-Based Awards table below. Mr. Dorer was not eligible to receive a fiscal 2023 AIP award due to the interim nature of his appointment. In connection with his retirement on December 2, 2022, Mr. Rendle forfeited any payout under the fiscal 2023 AIP. |
Summary Compensation Table
| (6) The amounts reported in this column represent the aggregate change in the actuarial present value of the named executive officers’ accumulated benefits under all defined benefit and actuarial pension plans (including supplemental plans) in fiscal 2023, fiscal 2022, and fiscal 2021. In accordance with SEC rules and guidance, if the net change in actuarial present value of accumulated benefits was negative, as it was in fiscal 2023, $0 is shown. For Messrs. Puckett and Rendle, the decrease in value in fiscal 2023 is due to changes in assumptions, primarily due to changes in discount rates. Fiscal 2023 amounts in this column for Mr. Scabbia Guerrini were valued in Swiss francs and converted to U.S. dollars at the average daily exchange rate for fiscal 2023 of 1.0469 U.S. dollars to the Swiss franc. Messrs. Dorer and Bailey and Ms. Otto do not participate in the defined benefit plans. See “Pension Benefits” below for a detailed discussion of VF’s pension benefits. |
Summary Compensation Table
| (7) This amount includes VF’s matching contribution under the VF Executive Deferred Savings Plan in fiscal 2023 as follows: Mr. Puckett, $61,050; Mr. Bailey, $56,837 and Ms. Otto, $6,490. For Messrs. Puckett, Bailey, and Rendle, the amount also includes VF’s payment of the cost of financial planning services, and for Messrs. Puckett and Bailey, the amount also includes VF’s payment of the cost of an annual physical. This amount also includes VF’s matching contribution under the VF 401k Plan as follows: Mr. Dorer, $6,000; Mr. Puckett, $19,249; Mr. Bailey, $18,789 and Ms. Otto, $4,327. For Messrs. Puckett and Bailey, this amount also includes VF’s payment of the cost of tax preparation services in the amount of $3,000 for Mr. Puckett and $1,500 for Mr. Bailey. For Mr. Scabbia Guerrini, this amount includes a transportation allowance of $6,281 and a representation allowance of $25,125. Amounts in this column for Mr. Scabbia Guerrini were paid in Swiss francs and converted to U.S. dollars at the average daily exchange rate for fiscal 2023 of 1.0469 U.S. dollars to the Swiss franc. With respect to Mr. Dorer, this amount also includes the following compensation received as a non-employee director prior to December 2, 2022: (i) cash retainer fees of $93,462, (ii) an award of 1,986 RSUs (the amount in the column represents the grant date fair value of $90,045 computed in accordance with FASB ASC Topic 718); and (iii) an award of an option to purchase 6,662 shares of VF common stock (the amount in the column represents the grant date fair value of $90,070 computed in accordance with FASB ASC Topic 718). For Mr. Bailey, this amount includes a technology allowance of $254, $38,858 of expenses paid in connection with his relocation and an associated tax gross-up of $18,446 for his relocation benefit. For Ms. Otto, this amount includes $26,289 of expenses paid in connection with her relocation and an associated tax gross-up of $11,684. This amount includes personal use of company aircraft in fiscal 2023 by Mr. Dorer of $304,560 and Mr. Rendle of $116,150 and an associated tax gross-up of $115. The cost of the personal use of aircraft was calculated based on the aggregate incremental cost to VF based on an hourly charge for VF’s aircraft that includes fuel, maintenance, salaries, ramp fees and landing fees. Family members of executives and their invited guests occasionally fly on VF aircraft as additional passengers on business flights. In those cases, there is no aggregate incremental cost to VF for the family member or guest, although taxable income is imputed to the individual. For Mr. Dorer, the amount includes corporate housing in Denver, Colorado near VF’s headquarters in the amount of $17,974 and an associated tax gross-up of $8,057. With respect to Mr. Rendle, this amount includes a payout of accrued PTO of $47,957 following his retirement and payments in consideration of the Protective Covenants Agreement (“PCA”) signed by Mr. Rendle in the amount of $456,438. Pursuant to the PCA, Mr. Rendle agreed to not compete with VF for a period of one year following his retirement on December 2, 2022. |
Summary Compensation Table
| (8) Mr. Dorer was appointed as Interim President and Chief Executive Officer effective December 2, 2022. |
Summary Compensation Table
| (9) Mr. Puckett was appointed as Executive Vice President and Chief Financial Officer effective at the end of May 2021. |
Summary Compensation Table
| (10) Mr. Bailey was an expatriate on assignment in Hong Kong from February 2017 through July 2020 and received expatriate compensation and benefits that are available on the same basis to all U.S. employees on foreign assignments. VF’s tax equalization policy is designed to ensure that an international assignee’s income tax burden while on foreign assignment is approximately the same as the assignee’s home-based income tax, regardless of the assignment location. A final determination as to the exact amount of Mr. Bailey’s tax equalization payments for fiscal 2022 and fiscal 2023 will not be available until his calendar 2021 through calendar 2023 tax equalization settlements are finalized. As a result, VF may make tax equalization payments and adjustments at a later date. Mr. Bailey’s fiscal 2021 tax equalization was finalized and resulted in a payment made by Mr. Bailey to the Company. |
Summary Compensation Table
| EXECUTIVE COMPENSATION | | Summary Compensation Table |
Summary Compensation Table
| (11) Ms. Otto was appointed as Global Brand President, The North Face effective May 31, 2022. |
Summary Compensation Table
| (12) Mr. Rendle retired as our Chair, President and Chief Executive Officer effective December 2, 2022. |
2023 Grants of Plan-Based Awards
2023 Grants of Plan-Based Awards The following table sets forth all grants of plan-based awards made to our NEOs during fiscal 2023. For further discussion regarding the grants, see the Compensation Discussion and Analysis section above.
2023 Grants of Plan-Based Awards
| NAME | DATE OF BOARD APPROVAL OF AWARDS (1) | GRANT DATE OF EQUITY AWARDS (1) | ESTIMATED POSSIBLE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS (2) | | | ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS (3) | | | ALL OTHER STOCK AWARDS: NUMBER OF SHARES OF STOCK OR UNITS (#) | ALL OTHER OPTION AWARDS: NUMBER OF SECURITIES UNDER- LYING OPTIONS (#) | EXERCISE OR BASE PRICE OF OPTION AWARDS (1) ($/SH) | GRANT DATE FAIR VALUE OF STOCK AND OPTION AWARDS ($) | | | | | THRESHOLD ($) | TARGET ($) | MAXIMUM ($) | THRESHOLD (#) | TARGET (#) | MAXIMUM (#) | | | | | | Mr. Dorer | 5/16/2022 | 5/24/2022 | | | | | | | | 6,662 | $45.34 | $90,070(4) | | | 5/16/2022 | 5/24/2022 | | | | | | | 1,986 | | | 90,045(5) | | | 12/5/2022 | 12/6/2022 | | | | | | | 67,981 | | | 2,000,001(6) | | Mr. Puckett | 5/16/2022 | | -0- | $700,000 | $1,400,000 | | | | | | | | | | 5/16/2022 | 5/24/2022 | | | | -0- | 22,056 | 49,626 | | | | 1,076,333 (7) | | | 5/16/2022 | 5/24/2022 | | | | | | | | 74,013 | 45.34 | 1,000,656 (8) | | Mr. Bailey | 5/16/2022 | | -0- | 700,000 | 1,400,000 | | | | | | | | | | 5/16/2022 | 5/24/2022 | | | | -0- | 29,776 | 66,996 | | | | 1,453,069 (7) | | | 5/16/2022 | 5/24/2022 | | | | | | | | 99,917 | 45.34 | 1,350,878 (8) | | | 1/23/2023 | 2/10/2023 | | | | | | | 26,198 | | | 700,011 (9) | | Mr. Scabbia Guerrini | 5/16/2022 | | -0- | 764,224 | 1,528,448 | | | | | | | | | | 5/16/2022 | 5/24/2022 | | | | -0- | 27,570 | 62,033 | | | | 1,345,416 (7) | | | 5/16/2022 | 5/24/2022 | | | | | | | | 92,516 | 45.34 | 1,250,816 (8) | | | 2/27/2023 | 3/6/2023 | | | | | | | 78,248 | | | 2,000,019 (9) | | Ms. Otto | 7/25/2022 | 8/2/2022 | | | | -0- | 22,056 | 49,626 | | | | 1,063,099 (7) | | | 7/25/2022 | 8/2/2022 | | | | | | | | 74,013 | 44.74 | 1,000,656 (8) | | | 7/25/2022 | 8/2/2022 | | | | | | | 55,879 | | | 2,500,026 (10) | | | 1/13/2023 | | -0- | 522,260 | 1,044,520 | | | | | | | | | Mr. Rendle | 5/16/2022 | | -0- | 2,800,000 | 5,600,000 | | | | | | | | | | 5/16/2022 | 5/24/2022 | | | | -0- | 105,316 | 236,961 | | | | 5,139,421 (7) | | | 5/16/2022 | 5/24/2022 | | | | | | | | 353,408 | 45.34 | 4,778,076 (8) |
2023 Grants of Plan-Based Awards
| (1) All equity awards are granted under the VF Stock Plan. Under the Stock Plan, the exercise price of stock options is the fair market value on the date of grant. “Fair market value” is defined under the Stock Plan as the average of the reported high and low sales price of VF Common Stock on the date of grant. With respect to the options granted on May 24, 2022, the average of the high and the low sales price was $45.34, and the closing market price was $45.49. With respect to the options granted on August 2, 2022, the average of the high and the low sales price was $44.74, and the closing market price was $44.33. The Compensation Committee’s general policy under the Stock Plan is to fix the date of grant of the options and performance-based equity awards as the third business day after VF announces its earnings for the previously completed fiscal year or quarter depending upon whether the award is an annual award or a mid-year award. |
2023 Grants of Plan-Based Awards
| (2) The amounts in these columns represent the threshold, target and maximum annual incentive awards under the AIP, as described above in the Compensation Discussion and Analysis section above. Depending upon the level of achievement of each of the specified performance goals, annual cash awards could range from 0% to 200% of the targeted incentive opportunity for each AIP participant. Mr. Scabbia Guerrini’s target has been converted to U.S. dollars from Swiss francs based on the average daily exchange rates for fiscal 2023 of 1.0469 U.S. dollars to the Swiss franc. |
2023 Grants of Plan-Based Awards
| (3) The amounts in these columns represent the threshold, target and maximum PRSU awards under the Mid-Term Incentive Plan (“MTIP”). These PRSUs were granted to the named executive officers for the three-year performance period of fiscal 2023 through fiscal 2025. |
2023 Grants of Plan-Based Awards
| Depending on the level of achievement of certain performance goals during the three years of the performance period, payouts of awards could range up to a maximum of 200% of the target award, and potentially plus or minus 25% of the target award depending on VF’s total shareholder return as compared to the total shareholder return of S&P 500 Consumer Discretionary Index companies |
2023 Grants of Plan-Based Awards
| EXECUTIVE COMPENSATION | | 2023 Grants of Plan-Based Awards |
2023 Grants of Plan-Based Awards
| over the performance period, for a total maximum payout of 225% of the target award. For a discussion of the performance goals applicable to the MTIP awards, as well as vesting, forfeiture and other terms, see the Compensation Discussion and Analysis section above. |
2023 Grants of Plan-Based Awards
| (4) The amount in this column represents the fair value of options awarded to Mr. Dorer while he was serving as a non-employee director. For further information on this award, including the assumptions used and the resulting weighted average fair value of stock options, see footnote 3 to the Fiscal 2023 Independent Director Compensation Table on page 20. |
2023 Grants of Plan-Based Awards
| (5) The amount in this column represents the grant date fair value of RSUs awarded to Mr. Dorer while he was serving as a non-employee director. For further information on this award, including the assumptions used and the resulting weighted average fair value of RSUs, see footnote 2 to the Fiscal 2023 Independent Director Compensation Table on page 20. |
2023 Grants of Plan-Based Awards
| (6) The amount in this column represents the grant date fair value of a time-vesting RSU award, 50% of which vested on June 2, 2023 and 50% of which will vest on December 2, 2023, subject to Mr. Dorer’s continued employment. For further information on this award, see “Compensation Discussion & Analysis – Elements of Compensation – Retention and Special Awards” above. |
2023 Grants of Plan-Based Awards
| (7) The aggregate fair value of the PRSUs was computed in accordance with FASB ASC Topic 718. See footnote 3 to the Summary Compensation Table. The assumptions used are summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. |
2023 Grants of Plan-Based Awards
| (8) The fair value on the date of grant of each option award was computed in accordance with FASB ASC Topic 718. The terms of options are described in footnote 1 to the Outstanding Equity Awards at Fiscal Year-End 2023 table. The assumptions used and the resulting weighted average fair value of stock options granted during fiscal 2023 are summarized in Note 18 to VF’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended April 1, 2023. |
2023 Grants of Plan-Based Awards
| (9) The amount in this column represents the grant date fair value of retention awards granted to Messrs. Bailey and Scabbia Guerrini of 26,198 RSUs and 78,248 RSUs, respectively, of which 50% will vest two years after the grant date and the remaining 50% will vest four years after the grant date so long as the executive remains in the employment of VF until the applicable vesting date. For further information on the awards, see “Compensation Discussion & Analysis – Elements of Compensation – Retention and Special Awards” above. |
2023 Grants of Plan-Based Awards
| (10) The amount in this column represents the grant date fair value of a special award granted to Ms. Otto in connection with her appointment to Global Brand President, The North Face of 55,879 RSAs, of which 25% will vest on each anniversary of the grant date for four years, so long as Ms. Otto remains in the employment of VF until the applicable vesting date. For further information on this award, see “Compensation Discussion & Analysis – Elements of Compensation – Retention and Special Awards” above. |
Outstanding Equity Awards at Fiscal Year-End 2023
Outstanding Equity Awards at Fiscal Year-End 2023 The following table sets forth information regarding the outstanding equity awards held by our NEOs as of April 1, 2023, after giving effect to the May 2019 adjustments made in connection with the Spin-off.
Outstanding Equity Awards at Fiscal Year-End 2023
| | OPTION AWARDS (1) | | | | | STOCK AWARDS | | | | | NAME | GRANT DATE | 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 (#) (2) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#) (2)(3) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($) (3) | | Benno Dorer | 2/22/2017 | 8,732 | -0- | $49.66 | 2/21/2027 | | | | | | | 2/21/2018 | 5,818 | -0- | 69.47 | 2/20/2028 | | | | | | | 5/24/2019 | 4,842 | -0- | 84.23 | 5/23/2029 | | | | | | | 5/19/2020 | 5,383 | -0- | 55.74 | 5/18/2030 | | | | | | | 5/25/2021 | 4,217 | -0- | 77.78 | 5/24/2031 | | | | | | | 5/24/2022 | -0- | 6,662 | 45.34 | 5/23/2032 | | | | | | | 5/24/2022 | | | | | 2,102(10) | $48,165 | | | | | 12/6/2022 | | | | | 70,296(10) | 1,610,478 | | | | Matthew H. Puckett | 2/19/2014 | 5,142 | -0- | 52.74 | 2/18/2024 | | | | | | | 2/18/2015 | 5,859 | -0- | 69.98 | 2/17/2025 | | | | | | | 2/23/2016 | 8,460 | -0- | 56.92 | 2/22/2026 | | | | | | | 2/22/2017 | 10,368 | -0- | 49.66 | 2/21/2027 | | | | | | | 2/21/2018 | 6,700 | -0- | 69.47 | 2/20/2028 | | | | | | | 5/24/2019 | 10,271 | -0- | 84.23 | 5/23/2029 | | | | | | | 5/19/2020 | 7,389 | 3,694 | 55.74 | 5/18/2030 | 8,394(6) | 192,313 | | | | | 3/8/2021 | | | | | 21,935(6) | 502,521 | | | | | 5/25/2021 | 14,881 | 29,761 | 77.78 | 5/24/2031 | | | 347(4) | $7,953 | | | 5/24/2022 | -0- | 74,013 | 45.34 | 5/23/2032 | | | 662(5) | 15,159 | | Kevin D. Bailey | 2/18/2015 | 19,469 | -0- | 69.98 | 2/17/2025 | | | | | | | 2/23/2016 | 22,933 | -0- | 56.92 | 2/22/2026 | | | | | | | 2/22/2017 | 38,201 | -0- | 49.66 | 2/21/2027 | | | | | | | 2/21/2018 | 35,264 | -0- | 69.47 | 2/20/2028 | | | | | | | 5/24/2019 | 55,753 | -0- | 84.23 | 5/23/2029 | | | | | | | 5/19/2020 | 44,239 | 22,164 | 55.74 | 5/18/2030 | | | | | | | 5/25/2021 | 20,668 | 41,335 | 77.78 | 5/24/2031 | | | 482(4) | 11,046 | | | 5/24/2022 | -0- | 99,917 | 45.34 | 5/23/2032 | | | 893(5) | 20,465 | | | 2/10/2023 | | | | | 26,560(8) | 608,479 | | | | Martino Scabbia Guerrini | 2/19/2014 | 15,028 | -0- | 52.74 | 2/18/2024 | | | | | | | 2/18/2015 | 19,469 | -0- | 69.98 | 2/17/2025 | | | | | | | 2/23/2016 | 22,933 | -0- | 56.92 | 2/22/2026 | | | | | | | 2/22/2017 | 38,201 | -0- | 49.66 | 2/21/2027 | | | | | | | 2/21/2018 | 35,264 | -0- | 69.47 | 2/20/2028 | | | | | | | 5/24/2019 | 55,735 | -0- | 84.23 | 5/23/2029 | | | | | | | 5/19/2020 | 44,329 | 22,164 | 55.74 | 5/18/2030 | | | | | | | 5/25/2021 | 20,668 | 41,335 | 77.78 | 5/24/2031 | 27,250(7) | 624,304 | 482(4) | 11,046 | | | 5/24/2022 | -0- | 92,516 | 45.34 | 5/23/2032 | | | 827(5) | 18,949 | | | 3/6/2023 | | | | | 79,328(7) | 1,817,399 | | |
Outstanding Equity Awards at Fiscal Year-End 2023
| EXECUTIVE COMPENSATION | | Outstanding Equity Awards at Fiscal Year-End 2023 |
Outstanding Equity Awards at Fiscal Year-End 2023
| | OPTION AWARDS (1) | | | | | STOCK AWARDS | | | | | NAME | GRANT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#)(2) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#) (2)(3) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($) (3) | | Nicole Otto | 8/2/2022 | -0- | 74,013 | 44.74 | 8/1/2032 | 58,523(9) | 1,340,756 | 662(5) | 15,159 | | Steven E. Rendle (11) | 2/19/2014 | 55,893 | -0- | 52.74 | 2/18/2024 | | | | | | | 2/18/2015 | 68,046 | -0- | 69.98 | 2/17/2025 | | | | | | | 7/28/2015 | 34,511 | -0- | 69.32 | 7/27/2025 | | | | | | | 2/23/2016 | 155,853 | -0- | 56.92 | 2/22/2026 | | | | | | | 2/22/2017 | 171,901 | -0- | 49.66 | 2/21/2027 | | | | | | | 2/21/2018 | 266,242 | -0- | 69.47 | 2/20/2028 | | | | | | | 5/24/2019 | 258,221 | -0- | 84.23 | 5/23/2029 | | | | | | | 5/19/2020 | 196,313 | 98,156 | 55.74 | 5/18/2030 | | | | | | | 5/25/2021 | 78,950 | 157,899 | 77.78 | 5/24/2031 | | | 1,842(4) | 42,195 |
Outstanding Equity Awards at Fiscal Year-End 2023
| (1) All of the options are non-qualified stock options awarded under the Stock Plan. The options awarded to Mr. Dorer in his capacity as a non-employee director generally have a stated term of ten years and become exercisable one year after the date of grant. Upon Mr. Dorer’s separation from the Board, options are exercisable for 36 months but not after the expiration of the option term. The remainder of this footnote addresses the options awarded to the other named executive officers. Each option becomes vested and exercisable in thirds on the first, second and third anniversaries of the date of grant. Options generally become fully vested and exercisable upon the executive’s death or termination of the executive’s employment due to disability or in the event of certain terminations following a change in control of VF. All options have a ten-year term but, in the event of certain terminations of the optionee’s employment, the options generally expire on an accelerated basis, as follows: 36 months after retirement, death or termination due to disability; at the end of the period severance payments are made (if any) in the case of involuntary termination; and at the time of any voluntary termination. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (2) For all restricted stock and restricted stock units awarded in 2018 and later, dividends are reinvested at the dividend payment date in additional shares that are subject to the same restrictions as the original award. For restricted stock units awarded prior to 2018, dividend equivalents accrue as cash amounts until vesting and payout, at which time such amounts are paid in additional shares of stock calculated by dividing the accrued dividend equivalents by the average of the high and low price of a share of VF Common Stock on the date the award is paid out. Dividend equivalents are not compounded. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (3) Amounts reported are based on the closing market price per share of VF’s Common Stock of $22.91 at March 31, 2023, the last trading day of VF’s fiscal 2023. The number of PRSUs was calculated by multiplying 3% (the actual level of achievement for the three-year performance period ended April 1, 2023) by the target number of PRSUs awarded, and the dollar value was calculated by multiplying 3% of the target number of PRSUs awarded (the number of shares in the chart is rounded to the nearest whole number; the dollar value is based on the actual number of shares including fractional shares) by $22.91. The final level of achievement for the awards in these columns may differ. For a discussion of vesting, forfeiture and other terms applicable to the RSUs, see the Compensation Discussion & Analysis section above. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (4) This number represents the number of PRSUs that were awarded under the MTIP by the Compensation Committee in 2021 for the three-year performance period ending April 2024 multiplied by an assumed achievement level of 3% (rounded to the nearest whole number of shares). At an achievement level of 225% (the maximum), the number of PRSUs and the corresponding value would be as follows (the number of shares is rounded to the nearest whole number; the dollar value is based on the actual number of shares including fractional shares): Mr. Puckett: 26,037 PRSUs with a value of $596,508; Mr. Bailey: 36,160 PRSUs with a value of $828,420; Mr. Scabbia Guerrini: 36,160 PRSUs with a value of $828,420; and Mr. Rendle: 138,132 PRSUs with a value of $3,164,604. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (5) This number represents the number of PRSUs that were awarded under the MTIP by the Compensation Committee in 2022 for the three-year performance period ending April 2025 multiplied by an assumed achievement level of 3% (rounded to the nearest whole number of shares). At an achievement level of 225% (the maximum), the number of PRSUs and the corresponding value would be as follows (the number of shares is rounded to the nearest whole number; the dollar value is based on the actual number of shares |
Outstanding Equity Awards at Fiscal Year-End 2023
| EXECUTIVE COMPENSATION | | Outstanding Equity Awards at Fiscal Year-End 2023 |
Outstanding Equity Awards at Fiscal Year-End 2023
| including fractional shares): Mr. Puckett: 49,626 PRSUs with a value of $1,136,932; Mr. Bailey: 66,996 PRSUs with a value of $1,534,878; Mr. Scabbia Guerrini: 62,033 PRSUs with a value of $1,421,165 and Ms. Otto: 49,626 PRSUs with a value of $1,136,932. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (6) Mr. Puckett received awards of 7,500 and 20,000 RSAs in May 2020 and March 2021, respectively. These RSAs vest in May 2024 and March 2025, respectively, provided that Mr. Puckett remains an employee of VF (except a pro rata portion of the award would vest in the event of termination due to death or disability and in the event of involuntary termination not for cause; and the award would vest upon certain terminations following a change in control of VF). Dividends on these RSAs are reinvested, at the dividend payment date, in additional shares that are subject to the same restrictions as the original awards. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (7) Mr. Scabbia Guerrini received an award of 25,000 RSUs in May 2021 that vested 50% in May 2023 and will vest 50% in May 2025, provided that Mr. Scabbia Guerrini remains an employee of VF for the term of the award. Mr. Scabbia Guerrini also received an award of 78,248 RSUs in March 2023 that will vest 50% in March 2025 and March 2027, provided that Mr. Scabbia Guerrini remains an employee of VF through the applicable vesting date. For both RSU awards, a pro rata portion of each award would vest in the event of involuntary termination not for cause and the award would vest upon termination due to death or disability and upon his termination following a change in control of VF. Dividends on these RSUs are reinvested, at the dividend payment date, in additional shares that are subject to the same restrictions as the original award. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (8) Mr. Bailey received an award of 26,198 RSUs in February 2023 that will vest 50% in February 2025 and February 2027, provided that Mr. Bailey remains an employee of VF through the applicable vesting date. A pro rata portion of the award would vest in the event of involuntary termination not for cause and the award would vest upon termination due to death or disability and upon his termination following a change in control of VF. Dividends on these RSUs are reinvested, at the dividend payment date, in additional shares that are subject to the same restrictions as the original award. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (9) Ms. Otto received an award of 55,879 shares of restricted stock in August 2022 that will vest 25% at each of the next four anniversaries of the grant date, provided that Ms. Otto remains an employee of VF through the applicable vesting date. A pro rata portion of the award would vest in the event of termination due to death or disability and in the event of involuntary termination not for cause. Dividends on these shares of restricted stock are reinvested, at the dividend payment date, in additional shares that are subject to the same restrictions as the original award. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (10) Pursuant to the terms of the non-employee director compensation program, Mr. Dorer received an award of 1,986 RSUs in May 2022 that will vest on the one-year anniversary of the grant date. In connection with his appointment as Interim CEO, Mr. Dorer received an award of 70,296 RSUs in December 2022 that vested 50% in June 2023 and will vest 50% in December 2023, provided that Mr. Dorer remains an employee of VF for the term of the award. For the RSU award, a pro rata portion of the award would vest if his employment is terminated prior to the vesting date due to his resignation upon the appointment of a permanent President and Chief Executive Officer or his termination of employment without cause and the award would vest in full upon termination due to death or disability. Dividends on these RSUs are reinvested, at the dividend payment date, in additional shares that are subject to the same restrictions as the original award. |
Outstanding Equity Awards at Fiscal Year-End 2023
| (11) Mr. Rendle retired as our President, Chief Executive Officer and Chair of the Board on December 2, 2022. As a result of his retirement, Mr. Rendle forfeited his fiscal 2023 equity awards. |
2023 Option Exercises and Stock Vested
2023 Option Exercises and Stock Vested The following table provides information for our NEOs regarding stock award vesting during fiscal 2023. Our NEOs did not exercise stock options during fiscal 2023.
2023 Option Exercises and Stock Vested
| | OPTION AWARDS | | STOCK AWARDS (1) | | | NAME | NUMBER OF SHARES ACQUIRED ON EXERCISE (#) | VALUE REALIZED ON EXERCISE ($) | NUMBER OF SHARES ACQUIRED ON VESTING (#) | VALUE REALIZED ON VESTING ($) | | Benno Dorer | -0- | $-0- | 1,125 | $52,119 | | Matthew H. Puckett | -0- | -0- | 119 | 2,572 | | Kevin D. Bailey | -0- | -0- | 715 | 15,428 | | Martino Scabbia Guerrini | -0- | -0- | 715 | 15,428 | | Nicole Otto | -0- | -0- | -0- | -0- | | Steven E. Rendle | -0- | -0- | 3,168 | 68,324 |
2023 Option Exercises and Stock Vested
| (1) These columns report the number and value of earned awards of PRSUs under the MTIP, including accrued dividends, as generally described in footnote 3 to the 2023 Grants of Plan-Based Awards table above, for the three-year period ended April 1, 2023, for all the NEOs other than Mr. Dorer and Ms. Otto. The PRSUs were paid out following the determination by the Compensation Committee on May 15, 2023 of the level of achievement for the performance period. The aggregate dollar amount realized by the |
2023 Option Exercises and Stock Vested
| EXECUTIVE COMPENSATION | | 2023 Option Exercises and Stock Vested |
2023 Option Exercises and Stock Vested
| NEOs upon the payout of the award was computed by multiplying the number of PRSUs by $21.57, the fair market value of the underlying shares on May 15, 2023, the payout date (the number of shares in the chart is rounded to the nearest whole number; the dollar value is based on the actual number of shares including fractional shares). The fair market value is defined under the Stock Plan to be the average of the high and low price of VF Common Stock on the applicable date. For Mr. Dorer, the amounts in these columns reflect the fair market value of 1,093 shares of restricted stock units, plus 32 shares of restricted stock units resulting from accumulated dividends on the restricted stock units, at the time of distribution in May 2022. No amounts reported in these columns were deferred. |
PENSION BENEFITS
PENSION BENEFITS VF sponsors and maintains the VF Corporation Pension Plan (the “Pension Plan”), a tax-qualified defined benefit plan that covers most of VF’s U.S.-based employees who were employed by VF on or before December 31, 2004, including Mr. Puckett (and covered Mr. Rendle prior to his retirement on December 2, 2022). Mr. Scabbia Guerrini has pension benefits under the VF International SAGL pension fund in Switzerland (the “Swiss Pension Plan”) that covers virtually all Swiss-based employees of VF International SAGL over 25 years of age. Benefits under the Pension Plan are calculated by reference to the employee’s “average annual compensation”, which is his or her average annual salary and annual incentive compensation from January 1, 2014, with no less than five years immediately preceding retirement included in the average. Effective December 31, 2018, the Pension Plan ceased to recognize any future service performance and any eligible compensation paid for purposes of calculating participant accrued benefits under the Pension Plan (i.e., no additional benefits accrue after such date). As of December 31, 2018, Messrs. Puckett and Rendle were the only NEOs who participated in the Pension Plan, and none of our other NEOs have ever participated in the Pension Plan. There are two formulas for computing benefits under the Pension Plan. The “normal retirement” formula is used for employees who qualify for “early retirement” under the Pension Plan upon termination, by being credited with at least ten years of service with VF and having attained age 55. The named executive officers who participate in the Pension Plan are eligible for nonforfeitable benefits under the Pension Plan and the VF Supplemental Executive Retirement Plan (“SERP”). Mr. Rendle’s participation in the Pension Plan and SERP was terminated upon his retirement on December 2, 2022. The SERP is an unfunded, nonqualified plan for eligible employees primarily designed to restore benefits lost under the Pension Plan due to the maximum legal limit of pension benefits imposed under ERISA and the Code. The combined retirement income from the Pension Plan and the SERP for each of the eligible named executive officers, upon retirement at age 65, would be an amount equal to his or her Pension Plan benefit calculated (i) without regard to any limitation imposed by the Code or ERISA, (ii) without regard to his participation in the Deferred Compensation Plan or the Executive Deferred Savings Plan, (iii) on the basis of the average of the highest three years of his salary and annual incentive compensation during the ten-year period immediately preceding retirement, and (iv) without deduction or offset of Social Security benefits. For purposes of the table below, the “normal retirement” formula has been used for determining the SERP benefits of all of the named executive officers who participate in the Pension Plan, regardless of whether they otherwise qualify for “early retirement” under the Pension Plan. Payments under the SERP with respect to the period prior to December 31, 2004 are payable in monthly payments or in a lump sum, and payments with respect to the period after December 31, 2004 are payable in a lump sum. At the end of December 2014, the Pension Plan and SERP were modified such that for certain executives, including the named executive officers, benefits would be frozen in the Pension Plan and would instead accrue in the SERP, and therefore accrued benefits under the SERP increased at a higher rate for service and earnings after December 31, 2014 and before January 1, 2019. Effective December 31, 2018, the SERP ceased to recognize any future service and any eligible compensation paid for purposes of calculating participant accrued benefits under the SERP (i.e., no additional benefits accrue after such date). As of December 31, 2018, Messrs. Puckett and Rendle were the only NEOs who participated in the SERP, and none of our other NEOs have ever participated in the SERP. The assumptions underlying the present values of the eligible U.S.-based named executive officers’ pension benefits are the assumptions used for financial statement reporting purposes and are set forth in Note 16 to VF’s Consolidated Financial Statements in its Annual Report on Form 10-K for the fiscal year ended April 1, 2023, except that retirement age is assumed to be age 65, the normal retirement age specified in the Pension Plan.
2023 Pension Benefits Table
2023 Pension Benefits Table
2023 Pension Benefits Table
| NAME | PLAN NAME | NUMBER OF YEARS CREDITED SERVICE (#) (1) | PRESENT VALUE OF ACCUMULATED BENEFIT ($) (2) | PAYMENTS DURING LAST FISCAL YEAR ($) | | Benno Dorer (3) | VF Corporation Pension Plan | -0- | $-0- | $-0- | | | Supplemental Executive Retirement Plan | -0- | -0- | -0- | | Matthew H. Puckett | VF Corporation Pension Plan | 19 | 314,700(2) | -0- | | | Supplemental Executive Retirement Plan | 19 | 781,800(2) | -0- | | Kevin D. Bailey (3) | VF Corporation Pension Plan | -0- | -0- | -0- | | | Supplemental Executive Retirement Plan | -0- | -0- | -0- | | Martino Scabbia Guerrini | Pension Fund of VF International SAGL in Switzerland | 17 | 1,368,061(4) | -0- | | Nicole Otto (3) | VF Corporation Pension Plan | -0- | -0- | -0- | | | Supplemental Executive Retirement Plan | -0- | -0- | -0- | | Steven E. Rendle | VF Corporation Pension Plan | 17 | 614,200 | -0- | | | Supplemental Executive Retirement Plan | 17 | 14,181,800 | -0- |
2023 Pension Benefits Table
| (1) As discussed above, the Pension Plan and SERP were frozen effective December 31, 2018, and no additional service credit will accrue after that date. Years of service reflected in this column for Messrs. Puckett and Rendle include service until December 31, 2018. The number of years of service credited to Mr. Scabbia Guerrini under the Swiss Pension Plan was computed as of the same measurement date used for financial statement reporting purposes with respect to VF’s audited financial statements for the fiscal year completed April 1, 2023. |
2023 Pension Benefits Table
| (2) The amounts in this column for Messrs. Puckett and Rendle are the actuarial present value of the named executive officer’s accumulated benefit under each plan, computed as of the same Plan measurement date used for financial statement reporting purposes with respect to VF’s audited financial statements for the fiscal year completed April 1, 2023. In connection with Mr. Rendle’s retirement effective December 2, 2022, he will receive his benefits under the Company’s pension plans that were vested as of such date. |
2023 Pension Benefits Table
| (3) Messrs. Dorer and Bailey and Ms. Otto do not participate in the Pension Plan or the SERP. |
2023 Pension Benefits Table
| (4) The amount for Mr. Scabbia Guerrini under the Swiss Pension Plan was calculated in Swiss francs and converted to U.S. dollars using an exchange rate of 1.0469 U.S. dollars to the Swiss franc, the average daily exchange rate for fiscal 2023. The amount is the actual account value of the portion contributed by VF into the Swiss Pension Plan. Under the Swiss Pension Plan, employee and employer together contribute a percentage of the employee’s base salary up to the maximum pensionable salary depending on the employee’s age. The portion of the contribution made by employer and employee depends on the category of the employee. In addition, Mr. Scabbia Guerrini periodically makes voluntary discretionary contributions to the plan. The annual post-retirement benefit under the Swiss Pension Plan is calculated as a percentage of the accumulated capital in the Swiss Pension Plan for the employee at the time the employee retires. In the event the employee retires earlier than the regular retirement age (which is currently 65 years of age for men), the percentage is reduced. Subject to certain conditions, participants may elect to receive pension benefits entirely or partially in a lump sum; any funds taken as a lump sum reduce the remaining capital and, as a result, the amount of the annual payments. Because of the way benefits are calculated under the Swiss Pension Plan it is not possible to express the pension benefits as a percentage of the last or an average salary. |
NONQUALIFIED DEFERRED COMPENSATION
NONQUALIFIED DEFERRED COMPENSATION VF senior executives, including the named executive officers other than Mr. Scabbia Guerrini, who is not based in the U.S., are permitted to defer compensation under the VF Corporation Executive Deferred Savings Plan II (the “EDSP”). In 2015, the terms of the EDSP were amended to permit an eligible executive to defer into a hypothetical “account,” on a pre-tax basis, annual compensation in excess of the IRS annual compensation limit for 401k contributions ($305,000 for calendar year 2022 and $330,000 for calendar year 2023) (but not more than 50% of the executive’s annual salary and 75% of the executive’s annual cash incentive payment). A participating executive’s account was also credited with matching credits equal to 100% on the first 6% of annual compensation deferred by the executive for the year. Compensation below the IRS annual compensation limit was eligible for contributions to the 401k Plan. The terms of the EDSP were amended effective January 1, 2020 to permit an eligible executive to defer into a hypothetical “account,” on a pre-tax basis, annual compensation from their first dollar earned (but not more than 50% of
NONQUALIFIED DEFERRED COMPENSATION
| EXECUTIVE COMPENSATION | | 2023 Pension Benefits Table |
NONQUALIFIED DEFERRED COMPENSATION
the executive’s annual salary and 75% of the executive’s annual cash incentive payment). A participating executive’s account will be credited with matching credits after the end of the plan year in an amount equal to 100% on the first 6% of deferrals for such plan year less the maximum matching contribution that could be made in the 401k Plan. Participants must be employed on the last day of the plan year to receive matching contributions for that plan year. The 401k Plan is a broad-based tax-qualified defined contribution plan for most U.S. employees of VF. A participant is credited with matching contributions equal to 100% on the first 6% of the annual compensation contributed by the participant to the 401k Plan, up to the IRS annual compensation limit of $305,000 for calendar year 2022 and $330,000 for calendar year 2023. EDSP accounts deferred after January 1, 2005 are generally payable in either a lump sum or in up to ten annual installments following termination of employment, as elected by the executive at the time of deferral. With respect to accounts deferred prior to January 1, 2005, an executive may request, subject to VF approval, distribution in a lump sum or in up to ten annual installments following termination of employment. Prior to termination of employment, an executive may receive a distribution of the executive’s EDSP account upon an unexpected financial hardship. Accounts deferred after January 1, 2020 also have in-service distribution options. Executives may elect to receive deferrals (together with all gains and losses attributable thereto) on a scheduled date while still employed by VF. If an executive elects to receive payment of deferrals while still employed by VF, payment cannot begin until at least five years from the plan year in which such deferrals were contributed. An executive may postpone a scheduled in-service distribution date as long as they (i) make the election to postpone at least twelve (12) months before the originally scheduled distribution date and (ii) the new distribution date is at least five (5) years after their originally scheduled distribution date. Accounts under the EDSP are credited with earnings and losses based on certain hypothetical investments selected by the executive. The hypothetical investment alternatives available to executives include various mutual funds. Executives may change such hypothetical investment elections on a daily basis.
2023 Nonqualified Deferred Compensation
2023 Nonqualified Deferred Compensation
2023 Nonqualified Deferred Compensation
| NAME | EXECUTIVE CONTRIBUTIONS IN FY2023 ($) (1) | VF CONTRIBUTIONS IN FY2023 ($) (2) | AGGREGATE EARNINGS IN FY2023 ($) (3) | AGGREGATE WITHDRAWALS/ DISTRIBUTIONS ($) | AGGREGATE BALANCE AT APRIL 1, 2023 ($) (4) | | Benno Dorer | $-0- | $-0- | $-0- | $-0- | $-0- | | Matthew H. Puckett | 80,735 | 61,050 | (220,058) | -0- | 2,263,342 | | Kevin D. Bailey | 79,741 | 56,837 | (120,693) | -0- | 1,624,192 | | Martino Scabbia Guerrini | -0- | -0- | -0- | -0- | -0- | | Nicole Otto | 180,289 | 6,490 | 9,944 | -0- | 196,723 | | Steven E. Rendle | 251,018 | -0- | (294,834) | -0- | 6,091,186 |
2023 Nonqualified Deferred Compensation
| (1) Amounts reported in this column are included as salary and non-equity incentive compensation in the Summary Compensation Table above. The type of compensation permitted to be deferred is cash compensation. |
2023 Nonqualified Deferred Compensation
| (2) Amounts reported in this column are included as All Other Compensation in the Summary Compensation Table above. For the 2022 calendar year, the matching contribution for qualified executives was made after the end of the 2022 calendar year, in February and March 2023 in an amount equal to 100% on the first 6% of deferrals for such year less the maximum matching contribution that could be made in the 401k Plan, provided the executive is employed on the last day of the 2022 calendar year. |
2023 Nonqualified Deferred Compensation
| (3) This column includes earnings and (losses) on deferred compensation balances. Such amounts are not “above-market” or “preferential” and therefore are not reported as compensation in the Summary Compensation Table above. |
2023 Nonqualified Deferred Compensation
| (4) This column reflects the aggregate of salary and non-equity incentive awards deferred by each named executive officer during his or her career with VF plus the aggregate amount of contributions by VF and the investment earnings thereon. Amounts deferred each year by the named executive officers have been reported in the Summary Compensation Tables in VF’s proxy statements in the year earned to the extent the executive was a named executive officer for purposes of proxy statement disclosure. |
Potential Payments Upon Change in Control, Retirement or Termination of Employment
Potential Payments Upon Change in Control, Retirement or Termination of Employment The following section describes payments that would be made to each of the continuing named executive officers and related benefits as a result of (i) a termination of service in the event of a change in control of VF, (ii) the executive’s retirement, (iii) the executive’s termination by VF without “cause”, (iv) the executive’s termination by VF with “cause”, or (v) the executive’s resignation, assuming these events occurred on April 1, 2023. Mr. Rendle retired effective December 2, 2022, and amounts paid to Mr. Rendle upon his retirement are described below. The descriptions below do not include the following amounts that the executives also would have received in all termination scenarios:
Potential Payments Upon Change in Control, Retirement or Termination of Employment
| (a) retirement benefits, the present value of which is disclosed in the 2023 Pension Benefits Table above, |
Potential Payments Upon Change in Control, Retirement or Termination of Employment
| (b) the aggregate balance disclosed in the 2023 Nonqualified Deferred Compensation table above, |
Potential Payments Upon Change in Control, Retirement or Termination of Employment
| (c) the executive’s AIP payment for the year ended April 1, 2023, as disclosed in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table above, or |
Potential Payments Upon Change in Control, Retirement or Termination of Employment
| (d) the value of the executive’s vested “in-the-money” unexercised stock options; the executive would be able to realize such value by exercise of the options prior to any termination, or the executive could retain the options after termination in all termination scenarios except termination by VF without “cause” with no severance, resignation not qualifying as a retirement or termination by VF with “cause”. |
Potential Payments Upon Change in Control, Retirement or Termination of Employment
The continuing named executive officers, other than Mr. Scabbia Guerrini, do not have employment contracts with VF; all of their potential payments outlined below are defined in benefit plan documents described in this proxy statement. Under Mr. Scabbia Guerrini’s 2006 employment agreement and Swiss law, he would receive six months of base salary and a pro rata amount of his annual incentive bonus which would have been earned for the year of termination in the event of his termination without cause. As described below under “Payments Upon Retirement,” as a result of retirement executives do not receive enhanced benefits other than under the terms of certain equity awards, pursuant to which an executive who is eligible for retirement would not forfeit his or her awards due to retirement.
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF VF has entered into Change-in-Control Agreements with Messrs. Puckett, Bailey and Scabbia Guerrini. These Agreements provide severance benefits to the executives only if their employment is terminated by VF without cause or for good reason by the executive within the 24-month period after a change in control of VF. “Good reason” for this purpose means a material reduction in the executive’s authority or duties, budget or compensation; a requirement that the executive relocate anywhere not mutually acceptable to the executive and VF; or a breach by VF of the Agreement. The Agreements have a term of two years with automatic annual extensions. The Agreements may be terminated by VF, unless VF has knowledge that a third party intends to effect a change in control of VF and, if a change in control has occurred, the agreements may not be terminated until two years after the change in control. Generally, severance benefits payable to the named executive officers include a lump-sum payment of an amount equal to 2.99 times the sum of (a) the greater of the executive’s highest annual base salary in effect at any time within the twelve-month period preceding a change in control of VF or the date of termination plus (b) the greater of (1) the highest amount of annual incentive awarded to the executive during the last three fiscal years prior to the date on which the executive’s employment is terminated following a change in control of VF and (2) the target annual incentive for the year of termination. Under the terms of the Agreements or the Stock Plan, upon a qualifying termination, the executives would also be entitled to supplemental benefits, such as payment of a pro rata portion of non-equity incentive compensation, accelerated vesting of stock options, accelerated lapse of restrictions on restricted stock units and restricted stock, lump-sum payments under the VF SERP for U.S.-based executives, continued life and medical insurance for specified periods after termination, entitlements under retirement plans and a lump-sum payment upon attaining retirement age. In the case of PRSUs under the MTIP, the PRSUs would be deemed earned based on the actual performance achieved through the date of termination projected for the entire performance cycle (except if performance in completed years is below-target the uncompleted years are projected at target), and such PRSUs would vest in full (without proration). Except as described below, the total payments to be made to an executive in the event of termination of employment upon a change in control of VF potentially could exceed the level of “parachute payments” (as that term is defined in the Code) that would trigger the “golden parachute excise tax,” which could result in imposition of excise taxes on the executive and loss of tax deductibility for VF. In the case of Messrs. Puckett and Bailey, if the excise tax would apply,
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
| EXECUTIVE COMPENSATION | | Potential Payments Upon Change in Control, Retirement or Termination of Employment |
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
each would receive the full payments (without gross-up) or the payments would be reduced to an amount just below the level triggering excise tax, whichever alternative results in the greater after-tax value to the recipient. A “change in control” under the Agreements would include any of the following events, subject to certain exceptions described in the Agreements:
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
| (A) an outside party acquires 20% of VF’s voting securities; |
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
| (B) members of the VF Board of Directors on the date of the Agreement, together with new members approved to join the Board by 75% of the “Incumbent Board” as defined in the Agreements, no longer constitute a majority of the Board; or |
POTENTIAL PAYMENTS UPON A CHANGE IN CONTROL OF VF
| (C) consummation of a plan or agreement providing for a merger or consolidation of VF if VF’s shareholders before the transaction no longer hold 65% or more of the voting power after the transaction. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2) If the named executives’ employment had been terminated by VF without cause or by the executives for good reason (as defined above) following a change in control of VF, assuming the triggering event occurred on April 1, 2023, the executives would be entitled to receive the following estimated amounts.
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| NAME | SEVERANCE AMOUNT (3) | PRSU AWARDS (4) | RSU/RSA AWARDS (5) | UNVESTED STOCK OPTIONS (6) | ESTIMATED VALUE OF BENEFIT CONTINUATION (7) | LUMP-SUM SERP BENEFIT (8) | TOTAL | | Mr. Dorer | $-0- | $-0- | $517,495 | $-0- | $-0- | $-0- | $517,495 | | Mr. Puckett | 3,757,706 | 854,197 | 694,834 | -0- | 57,000 | 211,729 | 5,575,466 | | Mr. Bailey | 4,008,992 | 1,165,158 | 608,479 | -0- | 57,000 | -0- | 5,839,629 | | Mr. Scabbia Guerrini (9) | 4,757,555 | 1,110,626 | 2,441,704 | -0- | 36,000 | -0- | 8,345,885 | | Ms. Otto | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (1) These disclosed amounts are estimates only and do not necessarily reflect the actual amounts that would be paid to the named executive officers, which would only be known at the time that they become eligible for payment and would only be payable if a change in control were to occur and the executive’s employment were terminated by VF without cause or by the executive with good reason. The table reflects the amount that could be payable under the various arrangements assuming that the change in control had occurred at April 1, 2023, and the executive’s employment had been terminated on that date. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (2) Valuations of equity awards in this table reflect a price per share of VF Common Stock of $22.91, the closing market price of VF’s Common Stock at March 31, 2023, the last trading day of VF’s fiscal 2023. Totals may not add up due to rounding. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (3) The amounts in this column represent 2.99 multiplied by the sum of the executive’s current base salary plus the highest actual annual incentive paid to the executive in the past three years. Mr. Puckett’s cash payment is reduced by $270,174 due to a reduction for excise tax implications. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (4) The amount in this column represents the estimated value of PRSU awards under the MTIP for incomplete cycles that would be paid upon a qualifying termination following a change in control. Incomplete cycles as of April 1, 2023, are the fiscal 2022-2024 and fiscal 2023-2025 PRSU award cycles, both estimated at 100% of target performance. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (5) The amount in this column represents the value of unvested restricted stock and unvested restricted stock unit awards. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (6) The amount in this column represents the “in-the-money” value of unvested stock options. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (7) The amount in this column represents the estimated present value of the continuation of health and welfare coverage over the 36-month severance period. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (8) The amount in this column represents the value of enhanced and accelerated SERP benefits for Mr. Puckett, who is the only current executive eligible to participate in the SERP. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| (9) Cash compensation to be paid to Mr. Scabbia Guerrini was converted from Swiss francs to U.S. dollars using the exchange rate of 1.0469 U.S. dollars to the Swiss franc, the average daily exchange rate for fiscal 2023. |
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL AND RELATED BENEFITS(1,2)
| EXECUTIVE COMPENSATION | | Potential Payments Upon Change in Control, Retirement or Termination of Employment |
PAYMENTS UPON TERMINATION DUE TO DEATH OR DISABILITY(1)
PAYMENTS UPON TERMINATION DUE TO DEATH OR DISABILITY(1) The following table shows the estimated value of all unexercisable options and unvested restricted stock or restricted stock unit awards on April 1, 2023, assuming the executives had terminated employment due to death or disability:
PAYMENTS UPON TERMINATION DUE TO DEATH OR DISABILITY(1)
| NAME | UNVESTED RESTRICTED STOCK OR UNITS ($) | PRSU AWARDS ($) | UNVESTED STOCK OPTIONS ($) | TOTAL ($) | | Mr. Dorer | $1,610,478 | $-0- | $-0- | $1,610,478 | | Mr. Puckett | 397,161 | 854,197 | -0- | 1,251,358 | | Mr. Bailey (2) | 608,479 | 1,165,158 | -0- | 1,773,637 | | Mr. Scabbia Guerrini (2) | 2,441,703 | 1,110,626 | -0- | 3,552,329 | | Ms. Otto | 222,083 | 534,196 | -0- | 756,279 |
PAYMENTS UPON TERMINATION DUE TO DEATH OR DISABILITY(1)
| (1) Valuations reflect a price per share of $22.91, the closing market price of VF’s Common Stock at March 31, 2023, the last trading day of VF’s fiscal 2023. Totals may not add up due to rounding. |
PAYMENTS UPON TERMINATION DUE TO DEATH OR DISABILITY(1)
| (2) These individuals were retirement eligible on April 1, 2023. Unearned MTIP awards are paid in full, reflect awards earned for actual performance through April 1, 2023 and assume target performance for 2022-2024 and 2023-2025. |
PAYMENTS UPON TERMINATION WITHOUT CAUSE
PAYMENTS UPON TERMINATION WITHOUT CAUSE In the event of a termination by VF without “cause”, (i) under the Stock Plan, the executive’s stock options would continue to vest and be exercisable until the end of the period of the executive’s receipt of installments of severance pay, if any, from VF, and (ii) under the Mid-Term Incentive Plan, if the executive has been an active participant for at least 12 months in a performance cycle, the executive would be eligible to receive a pro rata portion of the total number of PRSUs the executive is deemed to have earned based on performance in the completed portion of the performance cycle, with the pro rata portion determined as of the earlier of (a) the date of the last severance payment, if any, and (b) the last day of the performance period. Except as noted above with respect to Mr. Scabbia Guerrini, the determination of whether severance will be paid and the period over which it would be paid is in the discretion of VF’s Compensation Committee.
PAYMENTS UPON TERMINATION FOR CAUSE OR RESIGNATION
PAYMENTS UPON TERMINATION FOR CAUSE OR RESIGNATION In the event of a termination for “cause” or resignation not qualifying as retirement, each named executive officer would receive no additional compensation.
CEO Pay Ratio
CEO Pay Ratio VF Corporation is a global leader in branded lifestyle apparel, footwear and accessories, engaging in the design, procurement, marketing, and distribution of branded products in the Americas, Europe, and the Asia Pacific. During our last completed fiscal year, we determined that there has been no change in our employee population or employee compensation programs that would significantly impact our CEO pay ratio disclosure. However, the median employee we used for our fiscal 2022 calculation is no longer in the same position. As it was no longer possible to use the original median employee, we determined a new median employee whose compensation was substantially similar to the compensation of the original median employee identified for fiscal 2022, based on the methodology used to select the original median employee as disclosed in our fiscal 2022 proxy statement. Our CEO pay ratio for fiscal 2023 is a reasonable estimate calculated in compliance with the requirements of Section 953(b) of the Dodd-Frank Act and Item 402(u) of Regulation S-K. Our median employee is a full-time, U.S.-based retail associate whose annual total compensation for fiscal 2023 was $28,679, calculated in accordance with the requirements of the Summary Compensation Table. As we had multiple CEOs serving during fiscal 2023, in compliance with SEC requirements, we selected the CEO serving in the position on the date we selected to identify the median employee (February 1, 2023). Mr. Dorer’s annual total compensation, as reported in the Summary Compensation Table, was $3,037,566. Since Mr. Dorer was appointed interim CEO effective December 2, 2022, and in accordance with applicable SEC rules, we annualized his salary for his service as our CEO and added it to the other components of his pay disclosed in the Summary Compensation Table, to arrive at a value of $3,910,169. We used this value for the ratio of annual total compensation for our CEO to the annual total compensation for our median employee. Based on the above, our CEO to Median Employee Pay Ratio is 136:1. If we had selected Mr. Rendle as the CEO for purposes of our CEO pay ratio disclosure for fiscal 2023, and used the annual total compensation for Mr. Rendle as reported in the Summary Compensation Table, the ratio would have been 400:1.
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| 2 | The dollar amounts reported in these columns represent the amount of “compensation actually paid” to Messrs. Dorer and Rendle, as computed in accordance with Item 402(v) of Regulation S-K (“CAP”) in each applicable year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Messrs. Dorer and Rendle’s total compensation for each applicable year to determine their respective CAP : |
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| EXECUTIVE COMPENSATION | | Pay Versus Performance |
LIST OF FINANCIAL PERFORMANCE MEASURES USED TO LINK CAP FOR THE MOST RECENTLY COMPLETED FISCAL YEAR TO COMPANY PERFORMANCE
| EXECUTIVE COMPENSATION | | Pay Versus Performance |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE As described in more detail in the Compensation Discussion and Analysis above, the fundamental philosophy of our executive compensation programs is to pay for performance, through the alignment of our executives’ pay to the achievement of overall short- and long-term business strategies of VF. Our programs are designed to balance fixed and performance-based compensation components, and incentivize responsible achievement of multiple operating goals over one- and three-year periods. In accordance with Item 402(v) of Regulation S-K, we are providing the following graphs which illustrate the relationships over the past three years between CAP to our named executive officers and (i) our net income, (ii) our TSR and (iii) our rTSR. In addition, the second graph compares our TSR and our Peer Group TSR. Since a significant portion of the named executive officers’ compensation is comprised of equity awards (61% of Mr. Dorer’s target direct compensation and 62% of the average target direct compensation of our other named executive officers, excluding Ms. Otto, for fiscal 2023, as described in more detail in the Compensation Discussion and Analysis section above), the CAP of our Interim PEO and other named executive officers is higher when our stock price is higher, and lower when our stock price is lower, demonstrating the clear alignment of interests of our Interim PEO and other named executive officers with those of our shareholders.
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| | |

DEF 14A of V F Corp

Election of Directors

Election of Directors

Election of Directors

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

NOMINEES

BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS

BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS

BOARD SKILLS AND EXPERIENCE AND DEMOGRAPHIC BACKGROUNDS

IDENTIFYING AND EVALUATING NOMINEES FOR DIRECTOR

Board of Directors

Board of Directors

Board of Directors

Directors’ Compensation

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

FISCAL 2023 INDEPENDENT DIRECTOR COMPENSATION

Impact of Fiscal 2023 Performance on Incentive Payouts

Impact of Fiscal 2023 Performance on Incentive Payouts

CEO Target and Realizable Compensation

VF’s Compensation Principles

Fiscal 2023 Key Compensation Program Designs

Our Governance Practices

Our Governance Practices

Components of our Programs for Fiscal 2023

MR. DORER’S APPOINTMENT TO INTERIM PRESIDENT AND CHIEF EXECUTIVE OFFICER

MS. OTTO’S APPOINTMENT TO GLOBAL BRAND PRESIDENT, THE NORTH FACE

FISCAL 2023 COMPENSATION DECISIONS

BASE SALARY

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

ANNUAL INCENTIVE AWARDS

Fiscal 2023 Performance Goals and Metrics

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Goals

Fiscal 2023 Performance Summary

Performance Against Individual Strategic Objectives

PERFORMANCE-BASED RESTRICTED STOCK UNITS

Fiscal 2021 – 2023 Performance-Based Awards and Results

Fiscal 2021 – 2023 Performance-Based Awards and Results

Fiscal 2021 – 2023 Performance-Based Awards and Results

Fiscal 2022-2024 Performance Based Awards

Fiscal 2023-2025 Performance Based Awards

Fiscal 2023-2025 Performance Based Awards

STOCK OPTIONS

RETENTION AND SPECIAL AWARDS

RETENTION AND SPECIAL AWARDS

COMPETITIVE COMPENSATION TARGETS AND THE ROLE OF THE PEER GROUP