Stephanie Pugliese
DULUTH HOLDINGSAbout Stephanie Pugliese
Stephanie L. Pugliese, age 54, is President and CEO of Duluth Holdings Inc. (DLTH) and a director effective May 5, 2025; she holds a Bachelor of Science in Marketing from NYU Stern and is a 30-year retail veteran across branded apparel, merchandising, and operations . In her prior DLTH CEO tenure (2015–2019), management credits her with leading the company’s “most successful period to date,” doubling net sales and enhancing profitability . Context on company performance ahead of her return: FY2024 net sales fell 3.1% to $626.6M, net loss widened to ($43.6M), and Adjusted EBITDA was $14.6M; company TSR for a fixed $100 investment declined from $46 (FY2022) to $20 (FY2024) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Duluth Holdings | VP Product & Merchandising | Nov 2008–Jul 2010 | Built product/merch foundation; brand development |
| Duluth Holdings | SVP, Head of Merchandising & CMO | Jul 2010–Feb 2012 | Led merchandising and brand marketing |
| Duluth Holdings | President & CMO | Feb 2012–Feb 2014 | Expanded omni-channel marketing and assortment |
| Duluth Holdings | President & COO | Feb 2014–Feb 2015 | Execution scaling; operations leadership |
| Duluth Holdings | President & CEO | Feb 2015–Aug 2019 | “Doubled net sales,” improved profitability |
| Under Armour | President, North America | Sep 2019–May 2020 | Regional P&L leadership |
| Under Armour | President, Americas | Jun 2020–Mar 2023 | Multi-region operations and growth |
| Lands’ End | Executive roles | 2005–2008 | Merchandising/product roles |
| Ann, Inc. | Executive roles | 2000–2003 | Retail merchandising/marketing |
External Roles
| Organization | Role | Years | Committee/Notes |
|---|---|---|---|
| Fortune Brands Innovations, Inc. | Director | Mar 2023–present | Public company board |
| American Eagle Outfitters | Director | Aug 2024–Apr 2025 | Public company board (resigned) |
| Women in Retail Leadership Circle | Advisory Board | Current | Industry leadership |
| Cooper’s Hawk Winery & Restaurants | Advisory Board | Current | Consumer/retail advisory |
Fixed Compensation
| Component | Terms |
|---|---|
| Base Salary | $850,000 annually (reviewed annually; no reduction except across-the-board cuts) |
| PTO | 200 hours per calendar year (pro-rated) |
| Benefits | Eligible for senior executive benefit plans; expense reimbursement per policy |
Performance Compensation
| Incentive | Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|---|
| FY2025 Annual Bonus | Board-set financial thresholds | Not disclosed | 100% of base salary target; max 200% of base | Not disclosed | Prorated from May 5, 2025 | Cash; determined by Board/Comp Committee |
| FY2026 Equity Grant #1 | May include Adjusted EBITDA or other goals | Not disclosed | Minimum grant-date FV $1,700,000 | N/A | N/A | Ratable vesting over 3 years (1st, 2nd, 3rd anniversaries) |
| FY2026 Equity Grant #2 | May include performance-based vesting | Not disclosed | Minimum grant-date FV $600,000 | N/A | N/A | 100% vests on 3rd anniversary |
Notes: FY2025 bonus metrics and weights are not disclosed; FY2026 grants may include performance-based vesting such as Adjusted EBITDA .
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficial Ownership (Class B) | 1,972,280 shares; 5.7% of Class B; 2.9% total voting power |
| Inducement Equity (May 5, 2025) | Total 1,759,532 shares granted outside 2024 Plan under NASDAQ 5635(c)(4) |
| Inducement Shares – Immediate Vest | 586,511 shares vested 100% on May 5, 2025; subject to pro-rata reimbursement if she departs without Good Reason or for Cause before May 5, 2026 (12-month linear clawback) |
| Inducement RS – Time-Based | 1,173,021 shares; vest 33% on May 5, 2026; 33% on May 5, 2027; 34% on May 5, 2028; immediate vest if death, disability, termination without cause, or resignation for Good Reason; forfeiture otherwise |
| Stock Ownership Guidelines | CEO: 4x cash base salary; 5 years to comply; 50% net-after-tax retention until met |
| Hedging/Pledging | Prohibited for employees and directors (short sales, derivatives, hedges) |
Employment Terms
| Term | Detail |
|---|---|
| Appointment | CEO and Director effective May 5, 2025; replaces Interim CEO; no additional director compensation; not on committees |
| Work Location | Within 50 miles of HQ (Mount Horeb, WI); reasonable remote work permitted |
| Non-Compete | 2 years post-employment; Restricted Services to Competitors (incl. Carhartt, L.L. Bean, Cabela’s/Bass Pro, Columbia, Lands’ End, Under Armour, VF; >$100M revenue) in US/Canada |
| Non-Solicit | 2 years post-employment for defined “Restricted Persons” |
| Severance (No CIC) | If terminated without Cause or resigns for Good Reason: 12 months base salary continuation; pro-rated actual annual bonus; 12 months COBRA reimbursement grossed-up; subject to release; 409A timing rules may apply |
| Severance (During CIC Period) | Double-trigger: lump sum 2.5x (12 months base + target bonus); 18 months COBRA reimbursement grossed-up; subject to release; 409A timing rules may apply |
| Parachute Cutback | 280G best-net approach; reduce payments if greater after-tax net from reduction; ordering of reductions specified |
| Clawback | Company executive compensation recovery policy for restatements; Compensation Committee-administered; FY2023 restatement required no recovery due to no incentives paid |
Board Governance
- Role/Independence: Employee director; not independent (CEO); receives no additional director fees and will not serve on committees .
- Chair/CEO structure: As of proxy date, roles separated; Schlecht served briefly as Chairman & Interim CEO during transition, then resumed as Chairman after May 5, 2025 .
- Controlled company: DLTH is a NASDAQ “controlled company” given majority voting power by Chairman Stephen L. Schlecht; exemptions from some independence requirements; Schlecht serves on Compensation and Nominating & Governance Committees, impacting independence optics .
- Committees: Audit (Riley—Chair; Finch, Kennedy, Paschke; all independent, financial expert designated), Compensation (Edwardson—Chair until retirement; Robinson; Williams; Schlecht; independent members noted), Nominating & Governance (Finch—Chair; Edwardson; Finch; Paschke; Schlecht; Williams) .
- Attendance: Each incumbent director standing in 2025 attended ≥75% of meetings; Board held five meetings in FY2024; all then-current directors attended the 2024 annual meeting .
Director Compensation
| Component | Amount |
|---|---|
| Annual cash retainer (non-employee directors) | $50,000 |
| Audit Committee member retainer | $10,000; Chair $20,000 |
| Compensation/Nominating Committee member retainer | $7,000; Chairs $15,000 / $12,000 respectively |
| Annual equity grant (non-employee) | $80,000 in Class B restricted stock; vests in 1 year |
| Stock-in-lieu option | Directors may elect stock in lieu of 25–100% of cash retainers |
| CEO as employee director | No additional director compensation |
Performance & Track Record
| Metric | FY2022 | FY2023 | FY2024 |
|---|---|---|---|
| Net (Loss) Income ($) | $2.246M | ($9.923M) | ($43.700M) |
| Value of $100 based on TSR ($) | $46 | $33 | $20 |
| Net Sales ($M) | — | 646.7 | 626.6 |
Prior DLTH tenure: management states she doubled net sales and enhanced profitability (2015–2019) .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay approval: ~93% of votes cast supported NEO compensation .
- Compensation consultant: Meridian Compensation Partners retained; Compensation Committee affirmed independence and lack of conflicts .
Compensation Structure Analysis
- Equity-heavy alignment: Large inducement equity (1.76M shares) with multi-year vesting and meaningful time-based clawback on immediate-vest shares suggests retention and alignment over 12–36 months .
- Future grants include potential performance conditions (e.g., Adjusted EBITDA), indicating pay-for-performance intent for FY2026 awards .
- Severance economics: Double-trigger CIC at 2.5x base+target bonus is above typical small-cap retail medians, with COBRA gross-up; non-CIC severance at 1.0x salary plus pro-rated actual bonus balances retention with governance optics .
Risk Indicators & Red Flags
- Controlled company and founder participation on Compensation and Nominating committees may reduce perceived governance independence .
- COBRA gross-up in severance packages introduces shareholder-unfriendly optics versus no gross-up policies .
- Related-party leasing arrangements with entities controlled by the Chairman (flagship store/photo studio) are disclosed (aggregate $555,464 future payments), highlighting governance monitoring needs .
- Hedging/pledging prohibited, mitigating alignment risk; stock ownership guidelines enforce meaningful CEO ownership (4x salary) with five-year compliance window and 50% retention rule .
Investment Implications
- Compensation design emphasizes retention and multi-year equity alignment with potential performance-conditioned 2026 awards; immediate-vest inducement shares carry a one-year clawback, tempering near-term selling pressure .
- Governance remains a key diligence item given controlled company status and founder committee roles; however, audit and committee structures meet NASDAQ independence standards, and say-on-pay support was strong at ~93% .
- If she replicates prior DLTH execution (“doubling net sales” period), equity-heavy alignment could be attractive; watch for disclosed performance metrics/targets in upcoming proxy and whether Adjusted EBITDA/TSR targets tighten relative to the FY2022–FY2024 decline in TSR and widening losses .