DEF 14A of Zumiez Inc, Apr 21, 2023

DEF 14A of Zumiez Inc

Filed Apr 21, 2023 · FY20220001564590-23-006045

Open on EDGAR

  1. Director Compensation

    Director Compensation The goal of our director compensation is to help attract, retain and reward our non-employee directors and align their interests with those of the shareholders. Our desired goal for total director compensation (cash and equity) is to be at the 50th percentile of comparable companies based on our compensation consultant’s competitive survey results. The Company pays its non-employee directors an annual fee for their services as members of the board of directors. Each non-employee director receives an annual cash retainer of $70,000 and the lead independent director receives an additional $35,000. The audit committee chairperson receives an additional $25,400 per year, the compensation committee chairperson receives and additional $19,000 per year and the governance & nominating committee chairperson receives an additional $16,500. Directors appointed in an interim period receive pro-rata retainer fees based on the number of meetings they attend between annual shareholder meetings. The committee chairperson and the respective committee members are paid rates commensurate with the duties and responsibilities inherent within the position held. Additionally, the Company issues restricted stock awards to its non-employee directors. The board believes such awards provide alignment with the interests of our shareholders. Directors appointed in an interim period receive pro-rata restricted stock awards based on the number of meetings they attend between annual shareholder meetings. The Company reimburses all directors for reasonable expenses incurred to attend meetings of the board of directors. Non-employee directors may elect to have a portion, or all, of their annual retainer be used for the reimbursement of travel expenses in excess of those that the Company considers to be reasonable. The following table discloses the cash paid and stock awards earned by each of the Company’s non-employee directors during the fiscal year ending January 28, 2023:

  2. Director Compensation

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

  3. Director Compensation

    | (1) This column represents the aggregate grant-date fair value of restricted stock awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2022 Form 10-K. |

  4. Director Compensation

    On June 1, 2022, the day of the annual shareholder meeting, the Company awarded 2,729 shares of restricted stock to each of the current directors with a grant-date fair value of $90,000. The stock awards will vest on the earlier of June 1, 2023 or at the end of the directors scheduled term, if applicable.

  5. Election Of Directors

    Election Of Directors The Company currently has eight director positions. The directors are divided into three classes so that approximately one-third of the directors are elected each year for three-year terms. The Company believes that a classified board promotes continuity of experience and an orderly succession of directors, which, in turn, increases the stability of the Company and encourages a long-term corporate perspective. Directors are elected to hold office until their successors are elected and qualified, or until resignation or removal in the manner provided in our bylaws. Three directors are nominees for election this year and each has consented to serve a three-year term ending in 2026. The remaining directors will continue to serve the terms set out below. The nominees for director in an uncontested election, such as this one, will be elected if the votes cast in favor of a nominee’s election exceed the votes cast opposing such nominee’s election. Abstentions and broker non-votes are not considered “votes cast.” Likewise, a share otherwise present at the meeting as to which a shareholder gives no authority or direction to vote is also not considered a “vote cast.” In a contested election, the directors shall be elected by a plurality of the votes cast. A “contested election” means an election of directors of the Company in which the number of nominees for any election of directors nominated by (i) the board of directors, or (ii) any shareholder pursuant to Article 1, Section 10 of the Company’s bylaws, or (iii) a combination of nominees by the board of directors and any shareholder pursuant to Article I, Section 10 of the Company’s bylaws, exceed the number of directors to be elected. A nominee for director in an uncontested election who does not receive the requisite votes for election, but who was a director at the time of the election, shall continue to serve as a director for a term that shall terminate on the date that is the earlier of: (i) ninety (90) days from the date on which the voting results of the election are certified, (ii) the date on which an individual is selected by the board of directors to fill the office held by such director, which selection shall be deemed to constitute the filling of a vacancy by the board of directors, or (iii) the date the director resigns. Except in the foregoing sentence, a director who failed to receive a majority vote for election will not participate in the filling of his or her office. If none of the directors receive a majority vote in an uncontested election, then the incumbent directors (a) will nominate a slate of directors and hold a special meeting for the purpose of electing those nominees as soon as practicable, and (b) may in the interim fill one or more offices with the same director(s) who will continue in office until their successors are elected. If, for any reason, the directors shall not have been elected at any annual meeting, they may be elected at a special meeting of shareholders called for that purpose in the manner provided by the Company’s bylaws. The following tables set forth information regarding our eight directors as of January 28, 2023.

  6. Director Composition (as of 1/28/2023)

    Director Composition (as of 1/28/2023)

  7. Director Composition (as of 1/28/2023)

    | Name | Current Position with the Company | | Thomas D. Campion | Co-founder and Chairman of the Board | | Richard M. Brooks | Chief Executive Officer and Director | | Scott A. Bailey | Director | | Carmen R. Bauza | Director | | Steven P. Louden | Director | | James P. Murphy | Director | | Travis D. Smith | Director | | Liliana Gil Valletta | Director |

  8. Board Diversity Matrix (as of 1/28/2023)

    Board Diversity Matrix (as of 1/28/2023)

  9. Board Diversity Matrix (as of 1/28/2023)

    | | Female | Male | Non-Binary | Did Not Disclose Gender | | Gender Identity: | | | | | | Number of directors based on gender identity | 2 | 6 | 0 | 0 | | Number of directors who identify in any of the categories below: | | | | | | African American or Black | 0 | 0 | 0 | 0 | | Alaskan Native or Native American | 0 | 0 | 0 | 0 | | Asian | 0 | 0 | 0 | 0 | | Hispanic or Latinx | 2 | 0 | 0 | 0 | | Native Hawaiian or Pacific Islander | 0 | 0 | 0 | 0 | | White | 0 | 6 | 0 | 0 | | Two or More Races or Ethnicities | 0 | 0 | 0 | 0 | | LGBTQ+(1) | 0 | | | | | Did Not Disclose Demographic Background | 0 | | | |

  10. Board Diversity Matrix (as of 1/28/2023)

    | (1) Someone who self-identified as lesbian, gay, bisexual, transgender, or a member of the queer community. |

  11. Board Diversity Matrix (as of 1/28/2023)

    We invite and recommend all of our directors and the nominees for director to attend our annual meeting of shareholders.

  12. Nominees for Election for Terms Expiring in 2026

    Nominees for Election for Terms Expiring in 2026 Thomas D. Campion, 74, is one of our co-founders and has served on our board of directors since our inception in 1978. Mr. Campion has held various senior management positions during this time, including serving as our Chairman since June 2000. From November 1970 until August 1978, he held various management positions with JC Penney Company. Mr. Campion holds a B.A. in Political Science from Seattle University. He is the trustee of the Campion Foundation, a nonprofit organization focused on ensuring that biologically important ecosystems in Northwestern North America are preserved. The Foundation also works on homelessness issues in the Pacific Northwest. He is also a trustee of the Campion Advocacy Fund, a 501(c)(4) organization that was founded to support and strengthen efforts to end homelessness in the U.S. and protect wilderness in western North America through direct advocacy and political engagement. Director Qualifications: Mr. Campion’s knowledge as a retailer and as the co-founder of the Company provides the board with invaluable insight into the Company’s business and its unique culture. Mr. Campion provides generational leadership, sales, marketing, merchandising and brand building experience and expertise. Mr. Campion’s particular knowledge and experience with Zumiez and its competition helps the Company formulate short and long-term strategies that have contributed to Zumiez differentiating itself in the specialty niche of lifestyle retailing. As one of the Company’s largest shareholders, Mr. Campion’s interests are aligned with other Zumiez shareholders’ interests to increase the long-term value of the Company. Liliana Gil Valletta, 45, was appointed to our board in July 2019. Ms. Gil Valletta is the co-founder and CEO of Cien+ (since 2010) and Culturintel (since 2018), both of which are based in New York City and have offices throughout the U.S. and Colombia. Cien+ and Culturintel, collectively provide business consulting, big-data analytics, and marketing solutions for companies to help successfully turn cultural trends into opportunities for business success. Previously, Ms. Gil Valletta held a variety of marketing and supply chain roles at Johnson & Johnson, including serving as Global Marketing Services Director overseeing global strategy and agency contracting for the U.S. and EMEA regions. Ms. Gil Valletta also presently serves as an Operating Executive Board Member of AUA Private Equity Partners, a private equity firm that focuses on family-owned businesses benefiting from the growth of the U.S. Hispanic population. Additionally, Ms. Gil Valletta serves on the Board of Directors of RCN TV, a TV network based in Columbia. She also serves on the board of the YMCA of the USA and the Hispanic Chamber Fund. Ms. Gil Valletta earned a M.B.A. from the University of Colorado at Colorado Springs, an executive degree in Global Leadership and Public Policy from The Harvard Kennedy School at Harvard University and a B.A. in Business Administration from Southwestern Adventist University. Director Qualifications: Ms. Gil Valletta’s extensive experience in marketing and understanding and connecting with consumers from a cultural perspective provides unique insight to the Company’s board of directors. Her insights and perspective in this area are valuable to the Company in helping it understand its diverse customer base. She also brings experience in operating an international business. Carmen R. Bauza, 61, was appointed to our board in May 2022. Ms. Bauza currently serves as a member of the board of directors of Destination XL Group, Inc., where she serves on the Nominating and Corporate Governance Committee and the Cybersecurity and Data Privacy Committee. She also is a member of the board of managers of Claire’s Holdings LLC, where she serves on the Nominating and ESG Committee. Ms. Bauza also serves as a member of the board of directors of OneWater Marine Inc. Previously Ms. Bauza served as the Chief Merchandising Officer at Fanatics, Inc. from January 2019 until April 2021. Prior to that, she was the Chief Merchandising Officer at HSN from November 2016 until December 2017 and the Senior Vice President, General Merchandise Manager Consumables, Health and Wellness at Walmart from June 2007 to October 2016. She previously held roles at Bath & Body Works, Five Below and The Walt Disney Company. Ms. Bauza currently serves as a member of the board of trustees at Seton Hill University and as an Advisor to RoundTable Healthcare Partners. She previously served as a Director of Walmart of Mexico, the National Association of Chain Drug Stores, the Network of Executive Women and the Literacy Council of Benton County. Ms. Bauza holds a BS in Fashion Merchandising and Business from Seton Hill University. Director Qualifications: Ms. Bauza’s extensive experience in retail, merchandising and leadership make her a valuable member of our board of directors.

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

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

  14. Continuing Directors Whose Terms Expire in 2024

    Continuing Directors Whose Terms Expire in 2024 Richard M. Brooks, 63, has served as our CEO since June 2000. From August 1993 through June 2000, he served as a Vice President and our Chief Financial Officer. From November 1989 until February 1992, Mr. Brooks was with Interchecks, Inc., a subsidiary of Bowater PLC, as a finance officer. Mr. Brooks was with Deloitte, Haskins & Sells, currently known as Deloitte LLP, from July 1982 to March 1989. Mr. Brooks holds a B.A. in Business from the University of Puget Sound. Mr. Brooks serves on the Board of Directors of Stance, Inc. and is a trustee of the Brooks Foundation, a non-profit organization. Director Qualifications: Mr. Brooks’ day to day leadership as our CEO provides him with detailed knowledge of our business and operations. Mr. Brooks provides generational leadership, sales, marketing, merchandising and brand building experience and expertise. Mr. Brooks has demonstrated a record of innovation, achievement and leadership. This experience provides the board with a unique perspective into the operations and vision of Zumiez. Mr. Brooks’ particular knowledge and experience with Zumiez and its competition helps the Company formulate short and long-term strategies that have helped Zumiez differentiate itself in the specialty niche of lifestyle retailing. As one of the Company’s largest shareholders, Mr. Brooks’ interest is aligned with other Zumiez shareholders’ interests to increase the long-term value of the Company. Steven P. Louden, age 51, is currently the Chief Financial Officer of Roku, Inc., where he has served in this role since June 2015. From May 2009 to June 2015, Mr. Louden served in various capacities at Expedia, Inc., an Internet travel company, including as its Vice President, Corporate Finance and most recently serving as its Treasurer. Prior to joining Expedia, Mr. Louden has also previously held finance, strategy and planning roles at Washington Mutual, Inc., McKinsey & Company and the Walt Disney Company, and began his career as a financial analyst with Merrill Lynch and Co., Inc. Mr. Louden holds a B.A. in Economics and Mathematics from Claremont McKenna College and an M.B.A. from Harvard Business School. Director Qualifications: Mr. Louden brings financial expertise to the Company’s board of directors as well as leadership strategic development experience and experience with digital and media streaming businesses. James P. Murphy, 70, was appointed to our board in January 2021 and served as the EVP, COO of Costco Wholesale’s International Division until his retirement in December 2022. Mr. Murphy had been responsible for directing the expansion and operations of Costco’s businesses outside of North America since 2004 and was a member of Costco’s executive committee. Prior to Costco he held a variety of leadership roles including SVP - International, SVP - Europe, SVP - Northeast Region and VP Operations - Northern California. Prior to joining Costco in 1987 he worked for Lucky Stores in a variety of operational roles beginning in 1971. Mr. Murphy has served and continues to serve on a variety of non-profit boards including the University of Portland Board of Regents and the College Success Foundation, where he serves as Vice-Chair. Mr. Murphy earned a M.B.A. from the University of Portland and a B.S. in Business Administration from the University of Southern California. Director Qualifications: Mr. Murphy’s background as an executive leader with a leading global retailer brings relevant leadership and retail experience to Zumiez. His deep experience in international retail operations around the globe provides Zumiez with insight into international operations and strategies as Zumiez continues to grow its operations around the world.

  15. Continuing Directors Whose Terms Expire in 2025

    Continuing Directors Whose Terms Expire in 2025 Travis D. Smith, 50, was appointed to our board of directors in August 2012. Mr. Smith has been the Chief Executive Officer of Electronic Auction Services, Inc, a division of Health Trust, a leading group purchasing organization and supply chain performance company for healthcare, since April 2016. He also serves on their Board of Directors. Prior to his employment with Electronic Auction Services, Inc., he was the CEO and President of Jo-Ann Fabric and Craft stores from August 2011 until August 2014. Mr. Smith began his career with Jo-Ann in 2006 serving as the Executive Vice President, Merchandising and Marketing. In February 2009, Mr. Smith was named Chief Operating Officer and added the duties of President in February 2010, then Chief Executive Officer in August 2011. Prior to his employment with Jo-Ann, Mr. Smith held merchandising and marketing positions of increasing responsibility with Fred Meyer Stores, a division of the Kroger Company, ultimately serving as Senior Vice President, General Merchandise. Mr. Smith has also served on the Board of Directors of Pendleton Woolen Mills since February of 2016. Mr. Smith is a graduate of the University of Notre Dame with a Bachelor’s Degree in Business Marketing and Communications. Director Qualifications: Mr. Smith’s background in retailing and in particular merchandising, marketing and leadership roles adds important and relevant experience to the Company’s board of directors. Mr. Smith also brings experience in brand building, retail brick and mortar and direct to customer operations. Scott A. Bailey, 59, was appointed to our board in February 2016. Mr. Bailey is CEO of Path Projects, a running apparel company that he founded in 2017 that sells shorts, shirts, hats and base layers designed for runners directly to consumers. From 2002 to 2015 Mr. Bailey was the CEO and co-founder of One Distribution Company, a leading skate-inspired apparel and footwear company whose brands included KR3W Denim and SUPRA Footwear. KR3W is a lifestyle brand born out of the skateboard culture on the streets of Southern California in 2003 and is known for its denim apparel and SUPRA was launched in 2006 as a premium footwear brand known for its premium high top sneakers. Prior to One Distribution, Mr. Bailey was the co-founder of Split Inc., a youth culture men’s and women’s apparel brand founded in the early 1990s. Mr. Bailey is also a general partner in Overlook Point LLC, a residential and commercial land development company established in 2022. Director Qualifications: Mr. Bailey brings a unique brand and vendor perspective to the Company’s board of directors. He has had over a 25 year career as a co-founder and CEO of influential brands in the apparel and footwear space and his experience in growing and building brands both domestically and internationally will be beneficial to the board of directors in an ever changing consumer environment. Also, his understanding of the youth lifestyle customer is also very valuable to the Company.

  16. Information Regarding the Board of Directors and its Committees

    Information Regarding the Board of Directors and its Committees Our board has established an audit committee, compensation committee and governance and nominating committee. The board has adopted a written charter for each committee. The charters of these three committees are posted on the Company’s website and can be accessed free of charge at http://ir.zumiez.com and are available in print to any shareholder who requests them. The composition of our board committees complies with the applicable rules of the SEC and Nasdaq. The board has determined that Steven P. Louden is an audit committee financial expert as defined in the rules of the SEC. The following table displays the composition of our board of director committee assignments as of January 28, 2023:

  17. Information Regarding the Board of Directors and its Committees

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

  18. Information Regarding the Board of Directors and its Committees

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

  19. Information Regarding the Board of Directors and its Committees

    Audit Committee As more fully described in its charter, our audit committee has responsibility for, among other things:

  20. Information Regarding the Board of Directors and its Committees

    | • | the sole authority to appoint, determine the funding for and oversee the independent registered public accounting firm; |

  21. Information Regarding the Board of Directors and its Committees

    | • | assisting our board in monitoring the integrity of our financial statements and other SEC filings; |

  22. Information Regarding the Board of Directors and its Committees

    | • | discussing with our management and our independent registered public accounting firm significant financial reporting issues and judgments and any major issues as to the adequacy of our internal controls; |

  23. Information Regarding the Board of Directors and its Committees

    | • | reviewing our annual and quarterly financial statements prior to their filing with the SEC and prior to the release of our results of operations; |

  24. Information Regarding the Board of Directors and its Committees

    | • | reviewing the independence, performance and qualifications of our independent registered public accounting firm and presenting its conclusions to our board and approving, subject to permitted exceptions, any non-audit services proposed to be performed by the independent registered public accounting firm; |

  25. Information Regarding the Board of Directors and its Committees

    | • | reviewing and discussing with management the Company’s major operational, legal and regulatory risks, including data security and privacy and the Company’s policies and procedures to identify and manage cybersecurity risks; |

  26. Information Regarding the Board of Directors and its Committees

    | • | reviewing and approving any changes to the Company’s insider trading compliance program and procedures; |

  27. Information Regarding the Board of Directors and its Committees

    | • | oversight of the performance of the Company’s internal audit function; and |

  28. Information Regarding the Board of Directors and its Committees

    | • | reviewing its charter at least annually for appropriate revisions. |

  29. Information Regarding the Board of Directors and its Committees

    The audit committee has the power to investigate any matter brought to its attention within the scope of its duties and to retain counsel for this purpose where appropriate. Governance and Nominating Committee As more fully described in its charter, our governance and nominating committee has the responsibility for, among other things:

  30. Information Regarding the Board of Directors and its Committees

    | • | recommending persons to be selected by the board as nominees for election as directors and as chief executive officer; |

  31. Information Regarding the Board of Directors and its Committees

    | • | assessing our directors’ and our board’s performance; |

  32. Information Regarding the Board of Directors and its Committees

    | • | making recommendations to the board regarding membership and the appointment of chairpersons of the board’s committees; |

  33. Information Regarding the Board of Directors and its Committees

    | • | recommending director compensation and benefits policies; |

  34. Information Regarding the Board of Directors and its Committees

    | • | reviewing its charter at least annually for appropriate revisions; and |

  35. Information Regarding the Board of Directors and its Committees

    | • | recommending to the board other actions related to corporate governance principles and policies. |

  36. Information Regarding the Board of Directors and its Committees

    Compensation Committee As more fully described in its charter, our compensation committee has responsibility for, among other things:

  37. Information Regarding the Board of Directors and its Committees

    | • | establishing the Company’s philosophy, policies and strategy relative to executive compensation, including the mix of base salary, short-term and long-term incentive and equity based compensation within the context of the stated policies and philosophy including management development and succession planning practices and strategies; |

  38. Information Regarding the Board of Directors and its Committees

    | • | reviewing corporate goals and objectives relevant to compensation of our CEO and other senior executives including review and approval of performance measures and targets for all executive officers participating in the annual executive non-equity incentive bonus plan and certify achievement of performance goals after the annual measurement period to permit bonus payouts under the plan; |

  39. Information Regarding the Board of Directors and its Committees

    | • | determining and approving our CEO’s compensation and making recommendations to the board with respect to compensation of other executive employees, including any special discretionary compensation and benefits; |

  40. Information Regarding the Board of Directors and its Committees

    | • | administering our incentive compensation plans and equity based plans and making recommendations to the board with respect to those plans; |

  41. Information Regarding the Board of Directors and its Committees

    | • | making recommendations to our board with respect to the compensation of directors; |

  42. Information Regarding the Board of Directors and its Committees

    | • | the sole authority to appoint, determine the funding for and oversee the independent compensation consultant; and |

  43. Information Regarding the Board of Directors and its Committees

    | • | reviewing its charter at least annually for appropriate revisions. |

  44. Culture and Compensation Philosophy

    | • | reward performance by linking compensation to quantitative and qualitative goals that the compensation committee believes is in the best long-term interest of shareholders; |

  45. Culture and Compensation Philosophy

    | • | drive long-term shareholder thinking by delivering a substantial portion of the NEOs compensation or wealth in the form of equity that is directly linked to our stock price; |

  46. Culture and Compensation Philosophy

    | • | for at-risk components of pay, are an effective balance between short-term and long-term interests of our shareholders. |

  47. Compensation Goals and Strategy for NEOs

    | • | Establish a competitive total annual cash compensation opportunity for each position through annual cash incentives where payout is contingent on performance. |

  48. Compensation Goals and Strategy for NEOs

    | • | Provide opportunities to earn equity incentives in proportions so that the long-term opportunity for each NEO to earn total direct compensation (salary plus annual cash incentives plus equity incentives) is above average should shareholders realize above average returns. |

  49. Compensation Goals and Strategy for NEOs

    | • | Provide for the risk of zero annual short-term cash based incentives payout should minimum performance expectations not be met. |

  50. Compensation Goals and Strategy for NEOs

    | • | Grant of awards that upon achievement of target performance measures, are in the best long-term interests of the shareholders. |

  51. Compensation Goals and Strategy for NEOs

    | • | Set forth prudent limits, or caps, on upside potential to ensure no possibility of payouts that might be judged by shareholders as unjustifiable or excessive. |

  52. Compensation Goals and Strategy for NEOs

    The compensation committee believes that the Company’s long-term strategies, including its approach to Social Responsibility (discussed in more detail previously on page 24), drive long-term shareholder value and when properly executed upon will be reflected in the general financial performance measures discussed above. Accordingly, the compensation committee does not specifically target non-financial performance measures associated with a particular program, initiative or strategy, such as measures associated with environmental, social, and governance (ESG) metrics. For long-term pay-for-performance (long-term equity incentive), the compensation committee’s goal is to link the ultimate compensation amounts realized by NEOs directly and exclusively to the Company’s long-term common stock performance. To do so, the compensation committee makes use of stock-based awards for all NEOs (except as noted, below, under the section heading “The Compensation Decision-making Process”). The compensation committee has used, and intends to make use of, both gain-based stock awards (stock options) and full-value stock awards (restricted stock). The compensation committee determines on an annual basis for each NEO the total value of an award, based on a competitive range, that best reflects in the compensation committee’s judgment both the individual’s long-term track record of success and potential for long-term value-added future contributions. Gain-based awards have widespread use and have upside potential that can be highly motivational. However, the compensation committee: (i) is aware that gain-based awards have a different downside potential than that of holding outright shares of stock; (ii) recognizes that the exclusive and substantial use of gain-based awards has been historically noted by the investment community as a potential contributor to misguided or unacceptable decisions on the part of executives in certain other companies; and, (iii) knows that historic accounting advantages for the use of gain-based awards no longer exist. In addition, the compensation committee is aware of the executive compensation trend among publicly-held companies to utilize less gain-based awards in favor of full-value awards such as restricted stock. Therefore, the compensation committee continues to review and has deployed full-value restricted stock awards to help offset and balance the disadvantages of gain-based awards for achieving pay-for-performance and other compensation goals while retaining the advantages of gain-based awards. The mix of gain-based awards and full-value awards is evaluated annually by the compensation committee and adjusted based on input from the compensation consultant and the CEO, all in the context of the marketplace, our compensation philosophy, and what the compensation committee believes is in the best interest of the shareholders and the NEOs. The compensation committee also allows some deference to the CEO in the allocation between stock options and restricted stock, so long as the total compensation charge to Zumiez is equal to what was approved by the compensation committee. Executive Officer Continuity. Undesirable, unanticipated or untimely departure of an executive officer is a risk to the Company that the compensation committee works to avoid. The risk stems from the potentially high costs of recruiting, relocation, operational disruption, reduced morale, turnover ripple effects among staff, negative external perceptions, reduced external confidence and lost intellectual capital. The compensation committee encourages executive officer continuity by granting stock awards to a NEO where the ultimate realization of value not only depends on stock price, but also on the NEO remaining with Zumiez for many years. Accordingly, if a NEO were to depart from Zumiez then he or she could forfeit substantial amounts of unrealized compensation. Shareholder Mentality. We believe it is in the best interests of shareholders for our leaders to feel, think and act like shareholders, and to have a “shareholder mentality” as they go about envisioning, planning for and executing operations. The compensation committee seeks to cultivate NEOs with a shareholder mentality by having NEOs receive, accumulate and maintain significant ownership positions in Zumiez through annual equity grants. We do not believe it is necessary to establish share ownership or share holding requirements because historically the NEOs on aggregate have held a substantial amount of equity and, from a cultural point of view, NEOs are empowered to make decisions on their equity holdings taking into account their personal values, temperament, risk tolerance and personal finances. Within this concept, through equity awards granted over time, each of our NEOs has the ability to establish and maintain a valuable ownership in Zumiez.

  53. Summary of the Elements of NEO Compensation

    | • | Non-Equity Incentive Plan Compensation (“short-term cash based incentives”) |

  54. Summary of the Elements of NEO Compensation

    | • | Bonus |

  55. Summary of the Elements of NEO Compensation

    | • | Stock Option Grants |

  56. Summary of the Elements of NEO Compensation

    | • | Restricted Stock Grants |

  57. Summary of the Elements of NEO Compensation

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

  58. Short-Term Cash Based Incentives

    Short-Term Cash Based Incentives In March 2022, the compensation committee approved the terms of the fiscal 2022 short-term cash based incentives. Our NEOs short-term cash based incentives are targeted at approximately 0.2% of consolidated budgeted sales and 0.4% of consolidated budgeted sales at maximum payout. The short-term cash based incentives are appropriate to provide for increased payouts due to the significant shareholder returns commonly generated by above-target net sales, product margin and operating profit performance. The compensation committee has the discretion under the plan to reduce the awards paid under the plan, but does not have discretion to increase payouts that are based on achievement of the objective performance goals or make a payout based on the objective performance goals if the first threshold targets are not achieved. All of our executives are subject to our Executive Compensation Recovery Policy, which further mitigates excessive risk taking. No payouts are made until audited financial results are received, reviewed and approved by the audit committee at our March meeting after our fiscal year has ended. For each of the following performance measures, net sales, product margin and operating profit, the compensation committee established performance metrics for the NEOs. Performance metrics were established for North America operations and other international, consisting of Europe and Australia operations, for net sales, product margin and operating profit. The performance metrics on a consolidated basis were established for operating profit. These performance measures exclude the impact of changes in the foreign exchange rate, additional valuation allowances beyond those in the budgeted plan and does not include any share repurchases in the dilutive share count. Performance metrics for North America and other international operations are tightly managed and to the extent that overall shareholder return is still met, the compensation committee is allowed to make certain adjustments for strategic items not planned that negatively impact short-term growth expectations, but contribute to long-term growth expectations of the business unit. The first threshold relates to a minimum acceptable level of financial performance. The second threshold is intended to be the target performance. If the minimum acceptable level is achieved for any given metric, the incentives are calculated on a sliding scale culminating in the top threshold, which is designed as a stretch challenge. The compensation committee believes these goals are not easily achieved and, in the sixteen years since becoming a public company, no NEO has achieved all of the stretch challenge measurement goals. The compensation committee used different performance measures for different NEOs. These are noted in the following tables which show the performance thresholds for each performance measure used for fiscal 2022:

  59. Short-Term Cash Based Incentives

    | | Performance Metrics - Consolidated | | | | | | Objective Measure | 1 | 2 | 3 | 4 | 5 | | | | Target | | | | | Net sales growth - North America | -3.0% | -1.0% | 5.5% | 6.2% | 7.2% | | Net sales growth - Other international | 17.9% | 21.9% | 24.9% | 26.4% | 28.0% | | Product margin improvement - North America | Last year plus | Last year plus | Last year plus | Last year plus | Last year plus | | | 0.21% | 0.31% | 0.43% | 0.48% | 0.53% | | Product margin improvement - Other international | Last year plus | Last year plus | Last year plus | Last year plus | Last year plus | | | 0.44% | 0.54% | 0.91% | 1.10% | 1.29% | | Operating profit improvement - North America | -17.0% | -13.3% | 1.8% | 2.8% | 3.8% | | Operating profit improvement - Other international | 104.7% | 129.4% | 151.7% | 162.9% | 174.3% | | Operating profit improvement - Global | -12.8% | -7.8% | 9.1% | 10.6% | 12.2% |

  60. Short-Term Cash Based Incentives

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

  61. Short-Term Cash Based Incentives

    | | Performance Threshold | | | | | | Executive Officer | 1 | 2 | 3 | 4 | 5 | | Thomas D. Campion, Chairman of the Board | 33% | 65% | 98% | 114% | 130% | | Richard M. Brooks, Chief Executive Officer and Director | 63% | 125% | 188% | 219% | 250% | | Christopher C. Work, Chief Financial Officer | 38% | 75% | 113% | 131% | 150% | | Troy R. Brown, President North America | 35% | 70% | 105% | 123% | 140% | | Chris K. Visser, Chief Legal Officer and Secretary | 33% | 65% | 98% | 114% | 130% | | Adam C. Ellis, President International | 30% | 60% | 90% | 105% | 120% |

  62. Short-Term Cash Based Incentives

    The threshold percentages in the table above are multiplied by the percentages in the following table for each performance threshold achieved (“Objective Measure Weighting Percentage”). The compensation committee weights each threshold for each of the NEOs based upon that individual’s ability to impact the measure. The objective measures are weighted between North America and other international performance thresholds based on fiscal 2022 budgeted sales results, with exception of the President North America and President International, whose objective measures are weighted higher for North America operations and other international operations, respectively.

  63. Short-Term Cash Based Incentives

    | | Objective Measure | | | | | | | | Executive Officer | North America Net Sales | Other Inter-national Net Sales | North America Product Margin | Other Inter-national Product Margin | North America Operating Profit | Other Inter-national Operating Profit | Consolidated Operating Profit | | Thomas D. Campion, Chairman of the Board | 25% | 5% | 17% | 3% | n/a | n/a | 50% | | Richard M. Brooks, Chief Executive Officer and Director | 25% | 5% | 17% | 3% | n/a | n/a | 50% | | Christopher C. Work, Chief Financial Officer | 25% | 5% | 17% | 3% | n/a | n/a | 50% | | Troy R. Brown, President North America | 25% | 5% | 17% | 3% | 42% | 8% | n/a | | Chris K. Visser, Chief Legal Officer and Secretary | 25% | 5% | 17% | 3% | n/a | n/a | 50% | | Adam C. Ellis, President International | 5% | 25% | 3% | 17% | 8% | 42% | n/a |

  64. Short-Term Cash Based Incentives

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

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

    Base Salary ($) x Threshold Percentage x Objective Measure Weighting Percentage For fiscal 2022, the short-term incentive plan consisted of a first half and a second half plan. The first half plan is weighted at 40% of total target incentive and the second half plan is weighted at 60% of total target incentive. During fiscal 2022, we did not achieve any of the level one metrics. Accordingly, no short-term cash incentive awards were paid to the NEOs for fiscal 2022. The short-term cash based incentives target and compensation paid to the NEOs for fiscal 2022 are as follows:

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

    | Executive Officer | Short-Term Cash Based Incentive Compensation Target | Short-Term Cash Based Incentive Compensation Paid | | Thomas D. Campion, Chairman of the Board | $217,750 | $— | | Richard M. Brooks, Chief Executive Officer and Director | $918,750 | $— | | Christopher C. Work, Chief Financial Officer | $339,750 | $— | | Troy R. Brown, President North America | $393,400 | $— | | Chris K. Visser, Chief Legal Officer and Secretary | $245,700 | $— | | Adam C. Ellis, President International | $256,200 | $— |

  67. Bonus

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

  68. Bonus

    | • | current environment and current year performance, |

  69. Bonus

    | • | comparison of performance to peer group, |

  70. Bonus

    | • | cash and working capital position, and |

  71. Bonus

    | • | comparison to the incentive metrics of net sales, product margin and operating profit had the short-term cash-based incentive program been in place. |

  72. Bonus

    For fiscal 2022, the compensation committee did not elect to make any discretionary bonuses.

  73. Long-Term Equity Incentives

    Long-Term Equity Incentives The compensation committee uses long-term equity incentives as a significant component of total compensation consistent with the culture and compensation philosophy. The compensation committee continues to believe in the importance of equity compensation for all executive officers and issues equity incentives broadly through the management population. Additionally, because we do not have a pension or a supplemental executive retirement plan, we believe our executives should plan for their retirement substantially through potential wealth accumulation from equity gains. Long-term equity incentive awards are determined through a combination of the Company’s performance, execution of our total compensation strategy of rewarding executives and providing a foundation for wealth building. Our stock option awards generally have a ten-year term and typically vest 25% per year. Our restricted stock awards generally vest 33% per year. The compensation committee met in March 2022 and considered the performance of the Company, its overall compensation strategy and the level of equity grants to align the NEOs with shareholders. Based on the compensation committee’s deliberations, the following equity incentive awards were granted:

  74. Long-Term Equity Incentives

    | Executive Officer | Restricted Stock Grants | Stock Option Grants | | Thomas D. Campion, Chairman of the Board | — | — | | Richard M. Brooks, Chief Executive Officer and Director | — | — | | Christopher C. Work, Chief Financial Officer | 5,190 | 10,568 | | Troy R. Brown, President North America | 10,318 | 21,011 | | Chris K. Visser, Chief Legal Officer and Secretary | 3,707 | 7,549 | | Adam C. Ellis, President International | 4,448 | 9,058 |

  75. Long-Term Equity Incentives

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

  76. Who is Involved in Compensation Decisions for NEOs

    | • | Review and approve any up-front performance measures, goals, standards, weightings and formulas that may be used to determine future conditional awards for NEOs. |

  77. Who is Involved in Compensation Decisions for NEOs

    | • | Review total compensation compared to compensation opportunities and practices in the competitive market for executive talent. |

  78. Who is Involved in Compensation Decisions for NEOs

    | • | Appoint, determine the funding for, and oversee the independent compensation consultant. |

  79. Who is Involved in Compensation Decisions for NEOs

    | • | Develop, recommend and justify, to the compensation committee, any up-front performance measures, goals, standards, weightings and formulas that may be used to determine future conditional awards for the compensation program for NEOs. |

  80. The Compensation Decision-making Process

    | • | Tally sheets—We use tally sheets for each of the NEOs to summarize the significant components of compensation, including base salary, short-term cash based incentives, bonuses, and equity incentives. The tally sheets are compared to targeted total compensation. |

  81. The Compensation Decision-making Process

    | • | Competitive compensation analysis—At the compensation committee’s direction, the compensation consultant developed and delivered analysis of competitive compensation for each NEO position. The focus was on a representative benchmarking peer group to reflect the competitive market for executive talent. The benchmarking peer group was developed using industry, revenue and retail segment screening criteria to identify the peer group, which included Abercrombie & Fitch, American Eagle Outfitters, Buckle, Cato Corp, Citi Trends, Duluth Holdings, Five Below, Genesco, Hibbett Sports, Lands' End, Sportsman’s Warehouse Holdings, Tilly's, Urban Outfitters, and Vera Bradley. Analysis was performed using publicly-available information on executive pay levels compiled from the most recently available proxy statements of publicly-held companies. The compensation consultant provided expert opinions and conclusions to the compensation committee about targets for base salary, short-term cash based incentives and long-term equity incentives for our NEO roles. The committee used this information to ensure that our stated philosophy and strategy for aligning executive compensation opportunities with the competitive market has been and continues to be fulfilled. |

  82. The Compensation Decision-making Process

    | • | Audited results—The compensation committee reviews the final audited results to confirm that performance targets were achieved. No incentive awards are made until audited results are received by the board. |

  83. The Compensation Decision-making Process

    | • | Provide conservative (40th percentile) base salary opportunities against the Company’s competitive market for executive compensation talent. |

  84. The Compensation Decision-making Process

    | • | Establish average (50th percentile) total cash compensation opportunities (base salary, bonus and Short-Term Cash Based Incentives) against the competitive market. |

  85. The Compensation Decision-making Process

    | • | Provide long-term equity-based awards at the 50th percentile when compared to competitive practices for comparable roles. In the case of our Chairman and our CEO who beneficially own 5.1% and 13.0% of the Company, respectively, the compensation committee has concluded that each executive owns a sufficient amount of equity to align them with the long-term interests of shareholders. Because of this, neither our Chairman nor our CEO has received equity grants since before the Company’s initial public offering. |

  86. The Compensation Decision-making Process

    | • | Long-term wealth accumulation—the accumulated wealth from previous equity incentives granted to each NEO. |

  87. Enterprise Risk and Compensation

    Enterprise Risk and Compensation The compensation committee considers all facets of the NEOs compensation structure and believes it appropriately balances the drive for financial results and risks to the Company. The compensation committee aligns executive compensation with shareholder interests by placing a majority of total compensation “at risk,” and increasing the amount of pay that is “at risk” as the executives achieve higher levels of performance. “At risk” means the executive will not realize value unless performance goals are attained. The short-term incentives are tied to easily measurable financial metrics that the compensation committee believes are consistent, transparent and drive shareholder value; that is, net sales, product margin and operating profit. The majority of the long-term based compensation vests over several years and is not tied to specific financial metrics. By combining annual cash incentives tied to short-term financial performance along with the majority of the NEOs long-term wealth creation tied to stock performance, the compensation committee believes an appropriate balance exists between rewarding performance without excessive risk taking. In addition the compensation committee believes the short-term incentives in place that are tied to financial performance do not provide excessive risk to the Company as they are capped at no more than 250% of base pay for our CEO, 130% for our Chairman of the Board, 150% for our Chief Financial Officer, 140% for our President North America, 130% for our Chief Legal Officer and Secretary and 120% for our President International. The compensation committee believes that the overall executive compensation policy contains less than a ‘reasonable likelihood’ of material risk.

  88. Employment Agreements

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

  89. CEO/Median Employee Pay Ratio

    CEO/Median Employee Pay Ratio We believe in delivering quality employment experiences at all levels within the Company. In that regard, every year we create thousands of career opportunities for individuals who are just beginning their professional careers and who are driven to develop new skills in an environment centered around teaching and learning. Many of these opportunities are provided to our part-time sales associates, who on average are approximately 19 years of age, and are often furthering their career through concurrent education and/or additional employment opportunities. The median employee was identified by calculating fiscal year taxable income for each of our 9,159 employed individuals, excluding our CEO, on January 28, 2023. All employees located in North America and Europe were included in the calculation. A de minimis number of non-U.S. employees, approximately 206 located in Australia, were excluded. Additionally, any earnings paid to employees in a foreign currency were converted to U.S. dollars using the applicable exchange rates on the date listed above. To help assure an accurate representation of the median employee, earnings for regular employees employed for less than one year were annualized based on their individual average earnings to date. For fiscal 2022, we identified our median employee to be a part-time Sales Associate in one of our U.S. stores, whose annual compensation was $9,207. As stated in the “Total” column in the Summary Compensation Table, our CEO’s total compensation for fiscal 2022 was $740,487. As a result, we estimate our CEO to median employee pay ratio to be 80:1.

  90. Summary Compensation Table

    Summary Compensation Table The following table shows all compensation for fiscal 2022, 2021 and 2020 awarded to, earned by, or paid to our CEO, our CFO and our other named executive officers.

  91. Summary Compensation Table

    | | | Salary | Bonus | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | All Other Compensation | Total | | Name and Principal Position | Year | ($) (1) | ($) (2) | ($) (3) | ($) (4) | ($) (5) | ($) (6) | ($) | | Thomas D. Campion | 2022 | 335,033 | — | — | — | — | 4,986 | 340,019 | | Chairman of the Board | 2021 | 335,033 | — | — | — | 408,959 | 14,262 | 758,254 | | | 2020 | 335,033 | 217,000 | — | — | — | 11,573 | 563,606 | | Richard M. Brooks | 2022 | 735,000 | — | — | — | — | 5,487 | 740,487 | | Chief Executive Officer | 2021 | 735,000 | — | — | — | 1,725,515 | 13,952 | 2,474,467 | | and Director | 2020 | 735,000 | 918,000 | — | — | — | 11,205 | 1,664,205 | | Christopher C. Work | 2022 | 453,000 | — | 209,987 | 209,986 | — | 3,708 | 876,681 | | Chief Financial Officer | 2021 | 452,750 | — | 174,987 | 174,985 | 638,089 | 10,027 | 1,450,838 | | | 2020 | 440,000 | 308,000 | 159,997 | 160,000 | — | 7,948 | 1,075,945 | | Troy R. Brown | 2022 | 561,691 | — | 417,466 | 417,489 | — | 5,242 | 1,401,888 | | President North America | 2021 | 545,692 | — | 417,486 | 417,496 | 656,662 | 13,697 | 2,051,033 | | | 2020 | 530,000 | 452,000 | 399,993 | 400,000 | — | 10,940 | 1,792,933 | | Chris K. Visser | 2022 | 377,788 | — | 149,985 | 149,999 | — | 4,930 | 682,702 | | Chief Legal Officer | 2021 | 366,788 | — | 149,976 | 149,981 | 379,097 | 13,476 | 1,059,318 | | and Secretary | 2020 | 356,000 | 196,000 | 139,984 | 140,000 | — | 10,709 | 842,692 | | Adam C. Ellis | 2022 | 427,000 | — | 179,966 | 179,982 | — | 461,523(7) | 1,248,471 | | President International | 2021 | 425,750 | 124,067 | 449,974 | 149,981 | 133,247 | 233,316(7) | 1,516,335 | | | 2020 | 414,000 | 207,000 | 149,990 | 149,996 | — | 395,738(7) | 1,316,724 |

  92. Summary Compensation Table

    | (1) This column represents the base salary earned during fiscal 2022, 2021 and 2020. We use a fiscal calendar consisting of a 52- or 53-week period ending on the Saturday closest to January 31 with an extra week added to the fourth quarter every five or six years. Fiscal 2022, 2021 and 2020 were 52-week fiscal years. |

  93. Summary Compensation Table

    | (2) This column represents the bonus compensation awarded to NEOs during fiscal 2022, 2021 and 2020 and paid in early fiscal 2023, 2022 and 2021, respectively. For additional information on the amount related to bonus compensation, see the previous discussion in the Compensation Discussion and Analysis entitled “Bonus.” |

  94. Summary Compensation Table

    | (3) This column represents the aggregate grant-date fair value of restricted stock awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2022, 2021 and 2020 Form 10-K. Information regarding the restricted stock awards granted to the NEOs during fiscal 2022 is set forth in the Grants of Plan-Based Awards Table on a grant-by-grant basis. |

  95. Summary Compensation Table

    | (4) This column represents the aggregate grant-date fair value of stock option awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2022, 2021 and 2020 Form 10-K. Information regarding the stock option awards granted to our NEOs during 2022 is set forth in the Grants of Plan-Based Awards Table on a grant-by-grant basis. |

  96. Summary Compensation Table

    | (5) The amounts set forth in this column were earned during fiscal 2021 and paid in early fiscal 2022 to each of the NEOs under our executive Short-Term Cash Based Incentives. For additional information on the determination of the amounts related to Non-Equity Incentive Plan Compensation, see the previous discussion in the Compensation Discussion and Analysis entitled, “Short-Term Cash Based Incentives.” Information regarding the threshold, target and maximum estimated future payouts under non-equity incentive plan awards is set forth in the Grants of Plan-Based Awards Table. |

  97. Summary Compensation Table

    | (6) All other compensation includes 401(k) employer match contributions and company paid life insurance premiums. |

  98. Summary Compensation Table

    | (7) In fiscal 2017, Mr. Ellis relocated to Austria at our request and received international assignment-related benefits, including housing-related expenses and tax equalization. In fiscal 2022, he received $388,149 in tax equalization payments, $49,957 in housing-related benefits, and $13,340 in other assignment related benefits. In fiscal 2021, he received $226,549 in tax equalization payments. In fiscal 2020, he received $96,559 in housing-related benefits, $34,728 in other assignment-related costs, and $256,615 in tax equalization payments. The tax-equalization payments are intended to place Mr. Ellis in a similar net tax position as a similarly compensated employee in the United States. |

  99. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table provides information about equity and non-equity awards granted to the NEOs in fiscal 2022. In the columns described as Estimated Future Payouts Under Non-Equity Incentive Plan Awards, this table quantifies potential awards under the executive short-term cash based incentives plan discussed previously.

  100. Grants of Plan-Based Awards

    | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | | | All Other Stock Awards: Number of Shares of Stock | All Other Option Awards: Number of Securities Underlying | Exercise or Base Price of Option | Grant Date Fair Value of Stock and Option | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | or Units (#) (2) | Options (#) (3) | Awards ($) (4) | Awards ($) (5) | | Thomas D. Campion | | 108,875 | 217,750 | 435,500 | — | — | — | — | | Chairman of the Board | | | | | | | | | | Richard M. Brooks | | 459,375 | 918,750 | 1,837,500 | — | — | — | — | | Chief Executive Officer and Director | | | | | | | | | | Christopher C. Work | | 169,875 | 339,750 | 679,500 | | | | | | Chief Financial Officer | 3/14/2022 | | | | 5,190 | | | 209,987 | | | 3/14/2022 | | | | | 10,568 | 40.46 | 209,986 | | Troy R. Brown | | 196,700 | 393,400 | 786,800 | | | | | | President North America | 3/14/2022 | | | | 10,318 | | | 417,466 | | | 3/14/2022 | | | | | 21,011 | 40.46 | 417,489 | | Chris K. Visser | | 122,850 | 245,700 | 491,400 | | | | | | Chief Legal Officer and Secretary | 3/14/2022 | | | | 3,707 | | | 149,985 | | | 3/14/2022 | | | | | 7,549 | 40.46 | 149,999 | | Adam C. Ellis | | 128,100 | 256,200 | 512,400 | | | | | | President International | 3/14/2022 | | | | 4,448 | | | 179,966 | | | 3/14/2022 | | | | | 9,058 | 40.46 | 179,982 |

  101. Grants of Plan-Based Awards

    | (1) These columns show what the potential payout for each NEO was under the executive short-term cash based incentives for fiscal 2022 if the threshold, target or maximum goals were satisfied for all performance measures. The short-term cash-based incentive was approved in March 2022. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Short-Term Cash Based Incentives” and the Summary Compensation Table for amounts earned by the NEOs in fiscal 2022. |

  102. Grants of Plan-Based Awards

    | (2) This column shows the number of shares of restricted stock granted in fiscal 2022 to the NEOs. The restricted stock awards vest over a three-year period in equal annual installments beginning on the first anniversary date of the grant. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Long-Term Equity Incentives.” Information on the aggregate grant-date fair value of restricted stock awards is set forth in the Summary Compensation Table. |

  103. Grants of Plan-Based Awards

    | (3) This column shows the number of stock options granted in fiscal 2022 to the NEOs. These stock options vest over a four-year period in equal annual installments beginning on the first anniversary date of the grant. Please refer to the discussion in the Compensation Discussion and Analysis entitled, “Long-Term Equity Incentives.” Information on the aggregate grant-date fair value of stock option awards is set forth in the Summary Compensation Table. |

  104. Grants of Plan-Based Awards

    | (4) This column shows the exercise price for the stock options granted, which was the closing price of the Company’s stock on the grant date indicated. |

  105. Grants of Plan-Based Awards

    | (5) This column represents the aggregate grant-date fair value of restricted stock and stock option awards calculated in accordance with FASB ASC Topic 718, excluding the impact of estimated forfeitures related to service based vesting conditions. For assumptions used in determining these values, please see Note 2 (listed under Stock-Based Compensation) in the Notes to Consolidated Financial Statements in our fiscal 2022 Form 10-K. These amounts reflect the Company’s accounting expense for these stock option and restricted stock awards to be recognized over the vesting period of the grants, and do not correspond to the actual value that will be recognized by the NEO. |

  106. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table provides information on the holdings of stock option awards and restricted stock awards for the NEOs at January 28, 2023. This table includes unexercised and unvested stock options and restricted stock awards. The vesting schedule for each grant of stock options and restricted stock awards is shown in the footnotes to this table. The market value of the restricted stock awards is based on the closing market price of our stock on January 28, 2023, which was $25.75.

  107. Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | Stock Awards | | | | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable | Options Exercise Price | Option Expiration | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock that Have Not Vested | | Name | (#) | (#) | ($) | Date | (#) | ($) | | Thomas D. Campion | — | — | — | — | — | — | | Chairman of the Board | | | | | | | | Richard M. Brooks | — | — | — | — | — | — | | Chief Executive Officer and Director | | | | | | | | Christopher C. Work | 3,011(1) | — | 38.57 | 3/16/2025 | — | — | | Chief Financial Officer | 2,699(3) | — | 23.40 | 3/19/2028 | — | — | | | 3,133(4) | 3,133 | 24.54 | 3/18/2029 | — | — | | | 4,662(5) | 9,324 | 18.60 | 3/16/2030 | — | — | | | 1,928(6) | 5,784 | 45.31 | 3/15/2031 | — | — | | | —(7) | 10,568 | 40.46 | 3/14/2032 | — | — | | | — | — | — | — | 2,867(10) | 73,825 | | | — | — | — | — | 2,574(12) | 66,281 | | | — | — | — | — | 5,190(15) | 133,643 | | Troy R. Brown | 8,915(1) | — | 38.57 | 3/16/2025 | — | — | | President North America | 7,078(2) | — | 17.70 | 3/13/2027 | — | — | | | 25,906(3) | — | 23.40 | 3/19/2028 | — | — | | | 23,496(4) | 7,832 | 24.54 | 3/18/2029 | — | — | | | 23,310(5) | 23,310 | 18.60 | 3/16/2030 | — | — | | | 4,600(6) | 13,800 | 45.31 | 3/15/2031 | — | — | | | —(7) | 21,011 | 40.46 | 3/14/2032 | — | — | | | — | — | — | — | 9,302(8) | 239,527 | | | — | — | — | — | 7,168(10) | 184,576 | | | — | — | — | — | 6,142(12) | 158,157 | | | — | — | — | — | 10,318(15) | 265,689 | | Chris K. Visser | —(4) | 2,611 | 24.54 | 3/18/2029 | — | — | | Chief Legal Officer and Secretary | —(5) | 8,159 | 18.60 | 3/16/2030 | — | — | | | 1,652(6) | 4,958 | 45.31 | 3/15/2031 | — | — | | | —(7) | 7,549 | 40.46 | 3/14/2032 | — | — | | | — | — | — | — | 2,508(10) | 64,581 | | | — | — | — | — | 2,206(12) | 56,805 | | | — | — | — | — | 3,707(15) | 95,455 | | Adam C. Ellis | 4,371(5) | 8,741 | 18.60 | 3/16/2030 | — | — | | President International | 1,652(6) | 4,958 | 45.31 | 3/15/2031 | — | — | | | —(7) | 9,058 | 40.46 | 3/14/2032 | — | — | | | — | — | — | — | 3,877(9) | 99,833 | | | — | — | — | — | 2,688(11) | 69,216 | | | — | — | — | — | 6,621(13) | 170,491 | | | — | — | — | — | 2,206(14) | 56,805 | | | — | — | — | — | 4,448(16) | 114,536 |

  108. Outstanding Equity Awards at Fiscal Year-End

    | (1) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 16, 2015. |

  109. Outstanding Equity Awards at Fiscal Year-End

    | (2) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 13, 2017. |

  110. Outstanding Equity Awards at Fiscal Year-End

    | (3) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 19, 2018. |

  111. Outstanding Equity Awards at Fiscal Year-End

    | (4) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 18, 2019. |

  112. Outstanding Equity Awards at Fiscal Year-End

    | (5) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 16, 2020. |

  113. Outstanding Equity Awards at Fiscal Year-End

    | (6) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 15, 2021. |

  114. Outstanding Equity Awards at Fiscal Year-End

    | (7) Options subject to this grant vest over a four-year period in equal annual installments beginning on the one-year anniversary of the grant date. The grant date was March 14, 2022. |

  115. Outstanding Equity Awards at Fiscal Year-End

    | (8) This restricted stock grant vest over a five-year period in varying annual installments beginning on the second grant date anniversary. The grant date was June 15, 2018. |

  116. Outstanding Equity Awards at Fiscal Year-End

    | (9) This restricted stock units grant vest over a five-year period in varying annual installments beginning on the second grant date anniversary. The grant date was June 15, 2018. |

  117. Outstanding Equity Awards at Fiscal Year-End

    | (10) This restricted stock grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 16, 2020. |

  118. Outstanding Equity Awards at Fiscal Year-End

    | (11) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 16, 2020. |

  119. Outstanding Equity Awards at Fiscal Year-End

    | (12) This restricted stock grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 15, 2021. |

  120. Outstanding Equity Awards at Fiscal Year-End

    | (13) This restricted stock unit grant vest at the end of a three-year period beginning on the grant date. The grant date was March 15, 2021. |

  121. Outstanding Equity Awards at Fiscal Year-End

    | (14) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 15, 2021. |

  122. Outstanding Equity Awards at Fiscal Year-End

    | (15) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 14, 2022. |

  123. Outstanding Equity Awards at Fiscal Year-End

    | (16) This restricted stock unit grant vest over a three-year period in equal annual installments beginning on the grant date anniversary. The grant date was March 14, 2022. |

  124. Option Exercises and Stock Vested

    Option Exercises and Stock Vested The following table provides information for the NEOs on stock option exercises and on the vesting of other stock awards during fiscal 2022, including the number of shares acquired upon exercise or vesting and the value released before payment of any applicable withholding taxes and broker commissions.

  125. Option Exercises and Stock Vested

    | | Option Awards | | Stock Awards | | | | Number of Shares Acquired on Exercise | Valued Realized on Exercise (1) | Number of Shares Acquired on Vesting | Value Realized on Vesting (2) | | Name | (#) | ($) | (#) | ($) | | Thomas D. Campion | — | — | — | — | | Chairman of the Board | | | | | | Richard M. Brooks | — | — | — | — | | Chief Executive Officer and Director | | | | | | Christopher C. Work | — | — | 6,193 | 264,516 | | Chief Financial Officer | | | | | | Troy R. Brown | — | — | 24,636 | 922,339 | | President North America | | | | | | Chris K. Visser | 9,388 | 189,290 | 5,310 | 226,751 | | Chief Legal Officer and Secretary | | | | | | Adam C. Ellis | — | — | 9,416 | 308,449 | | President International | | | | |

  126. Option Exercises and Stock Vested

    | (1) The dollar amount realized upon exercise was calculated by determining the difference between the market price of the underlying shares of common stock at exercise and the exercise price of the stock options. |

  127. Option Exercises and Stock Vested

    | (2) The dollar amount realized upon vesting was calculated by applying the market price of the restricted stock shares on the vesting dates. |

  128. Pension Benefits

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

  129. Nonqualified Deferred Compensation

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

  130. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control Certain of the NEOs have unvested stock options and awards of restricted stock under the Company’s 2014 Equity Incentive Plan, the vesting of which may accelerate in the event of a Change in Control (as defined below). The Company does not maintain a severance or separation plan, or any such individual plans, for its executive officers. Accordingly, except as described below, there are no agreements, arrangements or plans that entitle the Company’s executive officers to enhanced benefits upon termination of their employment. The information below is a summary of certain provisions of these agreements and does not attempt to describe all aspects of the agreements. The rights of the parties are governed by the actual agreements and are in no way modified by the abbreviated summaries set forth in this proxy statement. Double-Trigger Acceleration of Stock Award Vesting The Company’s 2014 Equity Incentive Plan has a double-trigger acceleration which provides that in the event of a Change in Control we do not accelerate vesting of awards that are assumed or replaced by the resulting entity after a change in control unless an employee employment is also terminated by the Company without cause or by the employee with good reason within one year of the change in control. For purposes of the 2014 Equity Incentive Plan, “Change in Control” means:

  131. Potential Payments Upon Termination or Change in Control

    | (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation or other reorganization; or |

  132. Potential Payments Upon Termination or Change in Control

    | (ii) the sale, transfer or other disposition of all or substantially all of the Company’s assets. |

  133. Potential Payments Upon Termination or Change in Control

    A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction. The following table shows the potential payments the NEOs could have received under these arrangements in connection with a Change in Control on January 28, 2023:

  134. Potential Payments Upon Termination or Change in Control

    | | Change in Control with Double Trigger Acceleration | | | Executive Officer | Stock Option Vesting in Connection with a Change in Control (1) | Restricted Stock Vesting in Connection with a Change in Control (2) | | Thomas D. Campion Chairman of the Board | $— | $— | | Richard M. Brooks, Chief Executive Officer and Director | $— | $— | | Christopher C. Work Chief Financial Officer | $70,458 | $273,748 | | Troy R. Brown President North America | $176,143 | $847,948 | | Chris K. Visser Chief Legal Officer and Secretary | $61,496 | $216,841 | | Adam C. Ellis President International | $62,498 | $510,880 |

  135. Potential Payments Upon Termination or Change in Control

    | (1) Represents the amount calculated by multiplying the number of in-the-money unvested options with respect to which the vesting would accelerate as a result of Change in Control under the circumstances of a double trigger acceleration as defined in the 2014 Equity Incentive Plan noted by the difference between the exercise price and the closing price of a share of common stock on the last trading day of fiscal 2022. The number of shares subject to unvested stock options and exercise prices thereof are shown previously in the Outstanding Equity Awards at Fiscal Year-End table. |

  136. Potential Payments Upon Termination or Change in Control

    | (2) Represents the amount of unvested restricted stocks awarded with respect to which the vesting would accelerate as a result of a Change in Control under the circumstances of a double trigger acceleration as defined in the 2014 Equity Incentive Plan noted by the number of restricted stock shares unvested at the closing price of a share of common stock on the last trading day of fiscal 2022. |

  137. Potential Payments Upon Termination or Change in Control

    Death or Disability The restricted stock awarded under the Company’s 2014 Equity Incentive Plan provide that if a participant’s employment is terminated by reason of death or disability (as defined in the 2014 Equity Incentive Plan), then unvested restricted stock awards would accelerate and immediately vest. Beginning in March 2020, the stock options awarded under the Company’s 2014 Equity Incentive Plan provide that if a participant’s employment is terminated by reason of death and disability (as defined in the 2014 Equity Incentive Plan), then unvested stock options would accelerate and immediately vest. The value of the potential payments the NEOs that would have vested assuming a January 28, 2023 termination of employment due to death or disability was: Christopher C. Work, $340,415; Troy R. Brown, $1,014,614; Chris K. Visser, $275,178; and Adam C. Ellis, $573,378.

  138. Pay Versus Performance Table

    Pay Versus Performance Table As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between compensation actually paid to our Chief Executive Officer (CEO), Mr. Brooks, and other Named Executive Officers (NEOs) and certain financial performance metrics of the Company using a methodology that has been prescribed by the SEC.

  139. Pay Versus Performance Table

    | | | | | | Value of Initial Fixed $100 | | | | | | | | | | | | Investment Based on: | | | Company Selected Measures | | | | Year | Summary Compensation Table Total for CEO | Compensation Actually Paid to CEO | Average Summary Compensation Table Total Compensation for Other NEOs | Average Compensation Actually Paid to Other NEOs | Cumulative Total Shareholder Return | Peer Group Cumulative Total Shareholder Return | Net Income ($ millions) | Net Sales ($ millions) | Product Margin | Operating Profit ($ millions) | | 2022 | 740,487 | 740,487 | 909,952 | 268,029 | 82.61 | 117.11 | 21.0 | 958.4 | 56.9% | 31.1 | | 2021 | 2,474,467 | 2,474,467 | 1,367,156 | 1,369,613 | 138.76 | 149.69 | 119.3 | 1,183.9 | 57.4% | 157.8 | | 2020 | 1,664,205 | 1,664,205 | 1,118,380 | 1,885,722 | 138.21 | 157.47 | 76.2 | 990.7 | 56.3% | 96.9 |

  140. Pay Versus Performance Table

    The following amounts were deducted from or added to the amounts set forth in the Summary Compensation Table under the total compensation column in accordance with the SEC required adjustments to calculate Average Compensation Actually Paid to our non-CEO NEOs. The fair value of stock awards was determined using methodologies and assumptions developed in a manner substantively consistent with those used to determine the grant date fair value of such awards.

  141. Pay Versus Performance Table

    | Prior FYE | 2/1/2020 | 1/30/2021 | 1/29/2022 | | Current FYE | 1/30/2021 | 1/29/2022 | 1/28/2023 | | Fiscal Year | 2020 | 2021 | 2022 | | Average SCT Total for Other NEOs | 1,118,380 | 1,367,156 | 909,952 | | - Grant Date Fair Value of Stock Awards Granted in Fiscal Year | (339,992) | (416,973) | (382,972) | | + Fair Value at Fiscal Year-End of Outstanding Unvested Stock Awards Granted in Fiscal Year | 969,701 | 382,689 | 216,694 | | ± Change in Fair Value of Outstanding Unvested Stock Awards Granted in Prior Fiscal Years | 304,384 | 361 | (421,041) | | ± Change in Fair Value as of Vesting Date of Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | (166,751) | 36,380 | (54,604) | | Average Compensation Actually Paid to Other NEOs | 1,885,722 | 1,369,613 | 268,029 |