PROPOSAL NO. 3 — SECOND AMENDMENT TO THE COMPANY’S
AMENDED AND RESTATED STOCK PLAN
At the 2021 Annual Meeting, the Company’s stockholders will be asked to approve the Second Amendment (the “Amendment”) to the Fourth Amended and Restated Revlon, Inc. Stock Plan (as further amended, the “Plan”), attached to this Proxy Statement as Annex B. The Amendment provides for extending the expiration date of the Plan to August 1, 2030 and authorizing an additional 2,000,000 shares of Revlon Common Stock for issuance under the Plan.
The purposes of the Amendment are to continue to recruit, retain and incentivize eligible executives and other employees necessary to operate the Company; to incentivize Plan participants to achieve objectives which are tied to the achievement of the Company’s business plan and strategy, to enhance shareholder value; and to reflect the Company’s commitment to pay for performance. The Company believes that the Amendment continues to serve the Company’s objectives of recruiting, retaining and compensating key employees and providing an appropriate incentive for them to execute the Company’s business strategy.
In this Proposal No. 3, the Company is asking stockholders to approve the Amendment.
The Compensation Committee and the Board of Directors approved the Amendment on April 1, 2021, subject to stockholder approval. In determining the number of shares being requested pursuant to the Amendment, our Board and Compensation Committee carefully considered our anticipated future equity needs, our historical equity compensation practices and the advice of CAP, the Committee’s independent compensation consultant. The number of additional shares being requested for authorization under the Plan is 2,000,000 shares. The NYSE closing market price of the Revlon Common Stock on the Record Date was $11.60. The benefits to be derived under the Plan by the participants cannot be determined, because future grants under the Plan will be made at the Compensation Committee’s sole discretion, based on a variety of factors. In addition, the ultimate value of Awards under the Plan depends on a variety of factors, including vesting conditions and the market value of Revlon Common Stock.
During each of the prior three years, we granted Awards with respect to the following number of shares in the form of restricted stock or RSUs: approximately 1,065,300 in fiscal 2020, 1,163,500 in fiscal 2019, and 1,173,200 in fiscal 2018.
Below is a summary of awards outstanding and shares available for issuance under the Plan as of January 31, 2021:
We had outstanding unvested RSUs or restricted stock with respect to 1,762,302 shares of our Common Stock, assuming target performance of performance-based RSUs.
We had no outstanding stock options or stock appreciation rights.
We had 1,760,441 shares available for grant.
Summary of the Plan
The following summary of the Plan, as amended on September 5, 2019 and as amended further by the Amendment, is qualified in its entirety by the specific language of the Plan (a copy of which is attached as Annex C hereto). It should be noted that, although a description of the Plan is provided herein, the only changes being made pursuant to the Amendment are (i) extending the term of the Plan from April 14, 2021 to August 1, 2030 and (ii) authorizing an additional 2,000,000 shares of Revlon Common Stock for issuance under the Plan.
Eligibility. The Plan provides for the granting of awards to such employees of the Company, its subsidiaries and its affiliates as the committee administering the Plan, which is currently the Compensation Committee, may select from time to time. In addition, awards may be granted to directors who currently are not receiving compensation as officers or employees of the Company or any of its affiliates (“Non-Employee Directors”). As of the Record Date, 5,652 employees and 6 non-employee directors were eligible to participate in the Plan.
Types of Awards. Awards under the Plan may be made in the form of (i) incentive stock options (“ISOs”), which are designed to satisfy the applicable requirements set forth in Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), (ii) non-qualified stock options (“NQSOs”), which are not intended to satisfy such requirements (ISOs and NQSOs are collectively referred to as “Options”), (iii) stock appreciation rights, either granted in tandem with an Option or independent of any Option (collectively, “SARs”), (iv) restricted stock, (v) unrestricted stock and (vi) restricted stock unit Awards (“Restricted Stock Units” and, collectively with all other award types, “Awards”).