Ross 2015 Annual Report Download - page 62

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60
Employee Stock Purchase Plan. Under the Employee Stock Purchase Plan (“ESPP”), eligible employees participating in
the quarterly offering period can choose to have up to the lesser of 10% of their annual base earnings or the IRS annual
share purchase limit of $25,000 in aggregate market value to purchase the Company’s common stock. The purchase price of
the stock is 85% of the closing market price on the date of purchase. Purchases occur on a quarterly basis (on the last
trading day of each calendar quarter). The Company recognizes expense for ESPP purchase rights equal to the value of the
15% discount given on the purchase date.
During fiscal 2015, 2014, and 2013, employees purchased approximately 0.4 million shares, in each year, of the Company’s
common stock under the plan at weighted average per share prices of $43.16, $32.18, and $28.79, respectively. Through
January 30, 2016, approximately 39.0 million shares had been issued under this plan and 6.0 million shares remained
available for future issuance.
Note I: Related Party Transactions
The Company has a consulting agreement with Norman Ferber, its Chairman Emeritus of the Board of Directors, under
which the Company pays him an annual consulting fee of $1.5 million through May 2018. In addition, the agreement provides
for administrative support and health and other benefits for the individual and his dependents, which totaled approximately
$0.3 million in fiscal 2015, 2014, and 2013, along with amounts to cover premiums through May 2018 on a life insurance
policy with a death benefit of $2.0 million. On termination of Mr. Ferber’s consultancy with the Company, the Company will
pay Mr. Ferber $75,000 per year for a period of 10 years.
Robert Ferber, the son of Norman Ferber, is a buyer with the Company. The Company paid Robert Ferber compensation
including salary and bonus of approximately $131,000, $133,000, and $134,000 in fiscal 2015, 2014, and 2013, respectively.
Note J: Litigation, Claims, and Assessments
Like many retailers, the Company has been named in class action lawsuits, primarily in California, alleging violation of wage
and hour laws and consumer protection laws. Class action litigation remains pending as of January 30, 2016.
The Company is also party to various other legal and regulatory proceedings arising in the normal course of business.
Actions filed against the Company may include commercial, product and product safety, customer, intellectual property, and
labor and employment-related claims, including lawsuits in which private plaintiffs or governmental agencies allege that the
Company violated federal, state, and/or local laws. Actions against the Company are in various procedural stages. Many of
these proceedings raise factual and legal issues and are subject to uncertainties.
In the opinion of management, the resolution of pending class action litigation and other currently pending legal and
regulatory proceedings will not have a material adverse effect on the Company’s financial condition, results of operations, or
cash flows.