NEW YORK — Ralph Lauren, the 72-year-old founder, chairman and chief executive officer of Ralph Lauren Corp., signed a new five-year employment contract on June 26 that will keep him at the helm of the company he founded until April 1, 2017, the end of the firm’s 2017 fiscal year.
The agreement replaces a contract that would have expired next April, at the conclusion of the company’s current fiscal year.
Lauren’s new compensation package is less weighted toward cash and more toward equity to be derived through stock and option awards.
Under his new contract, Lauren’s salary increases 40 percent to $1.75 million a year from its previous level of $1.25 million. His target and maximum cash bonuses — phrased as “nonequity incentive plan compensation” in proxies like the one filed by the company with the Securities and Exchange Commission Monday — are reduced to $9 million and $13.5 million, respectively, from their previous levels of $13 million and $19.5 million.
Ralph Lauren Corp. filed a Form 8-K with the SEC detailing the new arrangement Monday, the same day it submitted its definitive proxy with the SEC.
In the proxy, Lauren’s reported compensation for fiscal 2012 rose 22.3 percent to $36.3 million from $29.7 million in 2011. The cash portion of his pay was unchanged, with salary and cash bonuses remaining at $1.25 million and $19.5 million, respectively. The salary and bonus numbers have remained unchanged for the past three fiscal years, with the $19.5 million representing the maximum possible and 150 percent of the target amount. The company said in its proxy that net income before taxes last year rose 23 percent above fiscal 2011 results, which also generated maximum bonus payouts.
In fact, all of Ralph Lauren’s top executive officers but Lauren — Roger Farah, president and chief operating officer; Jackwyn Nemerov, executive vice president; Tracey Travis, senior vice president and chief financial officer, and Mitchell Kosh, senior vice president of human resources — were eligible for and received an additional 10 percent above the maximum provision, for respective bonuses of $9.9 million, $3 million, $880,000 and $880,000.
The boost in Lauren’s reported compensation last year came from a 77.6 percent advance in Lauren’s stock and option awards, which totaled $15.3 million versus $8.6 million in the prior year. Because of vesting schedules and fluctuating stock prices, these awards aren’t necessarily received by the executives earning them but are required to be reported at fair market value at the time they are granted.
With Lauren’s new salary higher and his potential cash bonuses lower, his eligibility for stock and option awards has been modified so that it is now based on value, rather than the previous configuration that was tied to a specific number of equity units. The target amount for grants will be $14 million. One-third of this amount will fall under options that can’t increase, while the remaining two-thirds will be for restricted stock units that can increase up to 50 percent if performance criteria are met or be reduced if they aren’t.
Farah’s reported compensation was down 1.2 percent last year to $19.3 million, while Nemerov’s rose 19.3 percent to $12.1 million.
Taking the final spot on the mens’ portion of New York Fashion Week calendar next month will be none other than @tomford. Though he’s shown his men’s wear in New York in the past, this will mark the first time the designer has shown his men’s collection alone during New York Fashion Week: Men’s. His runway show will debut on February 6 at the Park Avenue Armory. #wwdfashion
London-based couture house @ralphandrusso has certainly been in the spotlight, having its dresses worn by @beyonce, Angelina Jolie, Meghan Markle in her engagement photos and more. For couture, Tamara Ralph focused on ornamentation — think: feathers with chain mail, jet embroidery and clusters of pearls and crystals. See the rest of the collection on WWD.com #wwdfashion #couture (📷: @giovanni_giannoni_photo)
Minnie Mouse celebrated her 90th birthday by getting her own star on the Hollywood Walk of Fame. For her celebratory luncheon, @coach’s creative director @stuartvevers dressed her in a custom made prairie dress, complete with Vever’s take on the polka dot – black sequined versions – under a cropped motorcycle jacket. The designer also put his own mark on Minnie’s classic red shoes, infusing the color with sparkles and adding some Coach crystals. “We chose colors that were very Minnie and also represented quintessential Coach elements,” said Vevers. #wwdfashion #nationalpolkadotday (📷: George Chinsee)
@nickjonas is unveiling his first-ever apparel collection through a partnership with John Varvatos. The limited-edition capsule, which makes its debut in spring, also marks the first time the designer has collaborated with anyone on a line. “The process in working with Nick is amazing. It’s inspiring to be around someone who is not only connected with the trade that they do, but also with what’s happening in the environment around him, and how that connects to what we do with style,” said Varvatos. (RG: @johnvarvatos) #wwdfashion
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)