The following describes our Policy and Procedure for Handling Transactions between the Company and Directors, Officers and companies Affiliated with them.
Any transaction between the Company and any officer or director or specified persons or with entities affiliated with any of them shall be disclosed to the Board of Directors and shall be subject to the approval of the Board of Directors or the Nominating and Governance Committee of the Board of Directors. This Policy and Procedure describes the evaluation and reporting of all such transactions.
- The terms officer and director (including nominees) include the spouse, children, step-children, parents, step-parents, siblings, parents-in-law, children-in-law, siblings-in-law and persons sharing the same residence as the officer or director. The terms of this policy and procedure apply to officers and directors and to any company that is an affiliate of such officer or director or his or her spouse, dependents or persons sharing the same residence.
- All proposed transactions between an officer, director – or an affiliate of either – and the Company shall be reported to and subject to the approval of the Nominating and Governance Committee prior to entering into such transaction except if (a) the proposed transaction is part of a general programme available to all directors or employees equally under an existing policy, or (b) the transaction is a purchase of Company products consistent with the price and terms of other transactions of similar size with other purchasers; it may be reported to the Nominating and Governance Committee after it has been entered into.
- There can be only one relationship between the Company and executive officers of the Company. Neither executives designated by the Board as Section 16 Officers nor their affiliates may enter into any transaction with the Company except as approved by the Board of Directors and as permitted to all Section 16 Officers or otherwise permitted under the Company’s benefit plans or policies.
- The Company and a director or an affiliate of a director may enter into transactions approved in advance by the Nominating & Governance Committee as provided in this Policy and Procedure or approved in advance or by the Board of Directors.
- The Nominating and Governance Committee may determine that any transaction with a director or an affiliate of a director that meets any of the following does not constitute a conflict of interest and may approve such transaction.
- The dollar amount of the transaction and all other transactions with the director during the year (whether or not previously approved or exempt from approval) is less than $100,000, and, for a director who is a member of the Audit Committee, does not constitute a proscribed consulting, advisory or other compensating fee.
- The proposed transaction is for the acquisition of products or services from an affiliate of the director and is either less than $100,000 or arises after a request for proposal, submitted to three or more entities (including the affiliate of the director); management determines that the proposed transaction by the affiliate of a director will provide the best value for the Company; the compensation proposed by the affiliate of the director is consistent with the compensation proposed by the other bidders; the director has not directly participated in the Herman Miller proposal process; and the Committee determines the transaction is in the best interests of the Company and its Shareholders.
- Management will advise the Nominating and Governance Committee if any proposed transaction or series of transactions with a director will result in the director being classified as other than an independent director for purposes of all applicable rules.
- Management will provide the Nominating and Governance Committee with a report relating to any related party transactions covered by this Policy and, if management requests that the Nominating and Governance Committee or the Board of Directors approve a proposed transaction under this Policy, a report detailing the terms of the proposed transaction and how it complies with this Policy.
- All transactions entered into under this Policy, whether exempted from approval or approved by the Nominating and Governance Committee, shall be reported to the Board of Directors.
- If the Nominating and Governance Committee determines that a proposed transaction does not meet the criteria for approval by the Nominating and Governance Committee as set forth in this Policy, the Nominating and Governance Committee shall refer the matter to the Board of Directors. The Board of Directors will determine whether the proposed transaction constitutes a conflict of interest, and whether to approve the transaction. Any approval of a transaction which is deemed to be a conflict of interest will constitute a waiver of the Code of Conduct and must be reported in appropriate filings with the SEC pursuant to the terms of the Code of Conduct.
- If a proposed transaction between the Company and a director or officer or an affiliate is being considered at a meeting of the Nominating and Governance Committee or the Board of Directors, that director or officer shall recuse himself or herself from all discussions at such meeting except to the extent requested to answer questions about the proposed transaction.
- Any transaction between the Company and a director or officer in which the amount invoiced exceeds $120,000 shall be reported in appropriate filings with the SEC if the director or officer had or will have a direct or indirect material interest.