Restoration Hardware 2012 Annual Report Download - page 12

CORPORATE GOVERNANCE STANDARDS AND DIRECTOR INDEPENDENCE
Corporate Governance Guidelines
Our Corporate Governance Guidelines generally specify the distribution of rights and responsibilities of our
board of directors and detail the rules and procedures for making decisions on corporate affairs. In general, the
stockholders elect our board of directors, which is responsible for the general governance of our company, including
selection and oversight of key management; and management is responsible for running our day-to-day operations.
Our Corporate Governance Guidelines are available on the Investor Relations section of our website, which
is located at www.ir.restorationhardware.com, by clicking on “Corporate Governance.”
Code of Business Conduct and Code of Ethics
We have adopted a code of business conduct and code of ethics applicable to our principal executive,
financial and accounting officers and all persons performing similar functions. Copies of these codes are
available on our investor relations website, accessible through our principal corporate websites at www.
restorationhardware.com and www.rh.com. We expect that any amendments to the codes, or any waivers of their
requirements, will be disclosed on our website or as required by applicable law or New York Stock Exchange
(“NYSE”) listing requirements.
Composition of our Board of Directors
Our board of directors consists of seven directors, including our Chief Executive Officer, and we expect to
add two additional members to our board of directors. Our certificate of incorporation provides that, subject to
any rights applicable to any then outstanding preferred stock and the terms of our stockholders agreement, our
board of directors shall consist of such number of directors as determined from time to time by resolution
adopted by a majority of the total number of authorized directors whether or not there exists any vacancies in
previously authorized directorships. Subject to any rights applicable to any then-outstanding preferred stock and
the terms of the stockholders agreement, any additional directorships resulting from an increase in the number of
directors may only be filled by the directors then in office unless otherwise required by law or by a resolution
passed by our board of directors. The term of office for each director will be until his or her successor is elected
at our annual meeting or his or her death, resignation or removal, whichever is earliest to occur.
Our board of directors is divided into three classes, with each director serving a three-year term, and one
class being elected at each year’s annual meeting of stockholders. Ms. Chaya and Mr. Demilio serve as Class I
directors with an initial term expiring in 2013. Mr. Mottola and Mr. Sternlicht serve as Class II directors with an
initial term expiring in 2014. Mr. Alberini, Mr. Chu and Mr. Forrest serve as Class III directors with an initial
term expiring in 2015.
Selection Arrangements
Under the stockholders agreement that we entered into with Home Holdings, LLC in connection with our
initial public offering, Home Holdings currently has the right to nominate two members to our board of directors.
Home Holdings’ equity interests are held by (i) CP Home Holdings, LLC, an investment entity managed by
funds affiliated with Catterton Management Company, LLC, (ii) Tower Three Home LLC, an investment fund
managed by Tower Three Partners, LLC, and (iii) funds affiliated with Glenhill Capital Management LLC. In
this proxy statement, we refer to Catterton, Tower Three and Glenhill as our “Principal Equity Holders.”
“Controlled Company” Status
After the May 10, 2013 record date of the Annual Meeting, certain stockholders of the Company, including
Home Holdings, sold shares of our common stock in a follow-on public offering which closed on May 20, 2013.
As result of the sale of these shares by Home Holdings, we ceased to be a “controlled company” under NYSE
listing rules.
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