Item
5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements
of Certain Officers.
Departure
of Directors or Certain Officers
On
December 7, 2020, Arvind Dharia notified the Board of Directors of Steven Madden, Ltd. (the “Company”) that
he intends to retire as the Company’s Chief Financial Officer, effective December 31, 2020. He will continue to serve as
a special advisor to ensure a smooth transition to his successor through the 2021 fiscal
year.
Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On
December 8, 2020, the Board of Directors of the Company appointed Zine Mazouzi to be the Company’s Chief Financial
Officer, effective January 1, 2021.
Mr.
Mazouzi, age 48, joined the Company in January of 2019 and is currently the Chief Accounting Officer and Senior Vice President—Finance
and Operations of the Company. Prior to joining the Company, he held various senior positions at Sears Holdings as the Chief Financial
Officer of Sears Footwear Group from 2016 to 2017, Head of the Footwear Group from 2017 to 2018 and Head of the Footwear, Home
and Jewelry Groups in 2018. Prior to that, he worked at Nine West Group from 1998 to 2015, where he held a number of increasingly
senior positions, including Chief Financial Officer from 2014 to 2015. Mr. Mazouzi received his Bachelor’s Degree in Finance
and a Master of Business Administration from Iona College.
On
December 8, 2020, the Company entered into an employment agreement with Mr. Mazouzi (the “Mazouzi Employment Agreement”)
pursuant to which Mr. Mazouzi will serve as the Chief Financial Officer of the Company.
The
term of the Mazouzi Employment Agreement will commence on January 1, 2021, and will continue for a term of three years
through December 31, 2023, unless sooner terminated in accordance with the terms thereof. Pursuant to the terms of the
Mazouzi Employment Agreement, Mr. Mazouzi will receive an annual base salary during the term of $550,000 for the calendar
year 2021, $575,000 for the calendar year 2022, and $600,000 for the calendar year 2023 and an automobile allowance of $1,250
per month in each year of the term. In addition, on January 4, 2021, pursuant to the Mazouzi Employment Agreement, Mr.
Mazouzi will be granted shares of restricted stock vesting 20% per year for five years commencing on the first anniversary of
the grant date. The number of restricted shares to be issued will be determined by dividing One Million Dollars ($1,000,000)
by the closing price of the common stock of the Company on January 4, 2021.
In
addition, the terms of the Mazouzi Employment Agreement entitle Mr. Mazouzi to an annual performance-based cash bonus for each
of the fiscal years ended December 31, 2021, 2022 and 2023 based on the following schedule:
Diluted
EPS
|
Bonus
as % of Salary
|
Maximum
(130% of Plan)
|
80%
|
Target
(100% of Plan)
|
50%
|
Threshold
(90% of Plan)
|
20%
|
For
actual diluted EPS amounts between the Threshold and Target amounts or between the Target and Maximum amounts, the bonus payable
shall be calculated based on a straight-line interpolation between the respective amounts.
Pursuant
to the terms of the Mazouzi Employment Agreement, the Company may terminate Mr. Mazouzi’s employment for Cause (as defined
in the Mazouzi Employment Agreement), in which event Mr. Mazouzi would be entitled to receive only his accrued and unpaid base
salary through the date of termination. If Mr. Mazouzi’s employment is terminated by the Company without Cause or Mr. Mazouzi
terminates the Mazouzi Employment Agreement for Good Reason (as defined in the Mazouzi Employment Agreement), Mr. Mazouzi would
be entitled to receive payment of his annual base salary, payable at regular payroll intervals, from the date of termination of
employment through the remainder of the term plus any performance-based cash bonus that has accrued but not yet been paid. In
addition, if Mr. Mazouzi’s employment is terminated by the Company without Cause or by Mr. Mazouzi for Good Reason during
the period commencing 30 days prior to a “Change of Control” (as defined in the Mazouzi Employment Agreement) and
ending 180 days following a Change of Control, he will be entitled to receive an amount equal to the lesser of (A) two and one-half
times the sum of (i) the annual base salary to which he was entitled as of the date of termination plus (ii) the average cash
bonus received by him for the preceding three-year period ending on the last previous December 31 or (B) the maximum amount that
is tax deductible to the Company under Section 280G of the Internal Revenue Code of 1986, as amended.
The
foregoing description of the Mazouzi Employment Agreement does not purport to be complete and is qualified in its entirety by
reference to the full text of such agreement filed as Exhibit 10.1 to this Current Report on Form 8-K, which is incorporated herein
by reference. Certain confidential information contained in this exhibit was omitted by means of
redacting a portion of the text and replacing it with [*****], pursuant to Regulation S-K Item 601(b) of the Securities Act of
1933, as amended. Certain confidential information has been excluded from the exhibit because it is (i) not material and (ii)
would be competitively harmful if publicly disclosed.