April 6, 2023

Dear Fellow Shareholders,

Carter’s is the largest branded marketer of young children’s apparel in North America, with the leading share of a $34 billion apparel market focused on newborn to 10-year old children. Over the past 100 years, we believe Carter’s has provided multiple generations of families with a strong value proposition in our product offerings, including baby apparel, sleepwear, playwear, and related accessories.

We own two of the most highly recognized and trusted brand names in the children’s apparel market, Carter’s and OshKosh B’gosh. We also own Little Planet, our new and innovative product offering comprised of organic fabrics and recycled materials, and Skip Hop, a leading young children’s lifestyle brand.

Since its founding in 1865, Carter’s has built a unique multi-channel and global business model, which includes retail stores, eCommerce, and wholesale distribution capabilities. We believe no other company in the world has our scope of distribution and success in branded children’s apparel.

2022 was another historic year for Carter’s, our third in a row. In 2020, we worked our way through a once-in-a-lifetime global pandemic and retained a higher level of profitability than most companies in our peer group. In 2021, we saw a strong recovery from the pandemic and achieved record profitability, driven by structural changes in our business. Those changes included a reduction of low-margin product choices, closure of less productive stores, and improved inventory management and pricing capabilities. In 2021, Carter’s also benefitted from unprecedented U.S. government stimulus that supported families with young children. In 2022, a 41-year high in inflation drove a surge in gas and food prices, slowed the global economy and demand for our brands.

When the year began, we expected 2022 would be a continuation of the strong post-pandemic recovery that we experienced in 2021, as consumers emerged from COVID isolation, had access to vaccines and began to reconnect with family and friends. The year got off to a good start as we saw high single-digit growth in our comparable U.S. Retail sales through February.

By the spring of 2022, it became clear that inflation was not transitory. U.S. inflation peaked at over 9% in June and continued to weigh on consumers in the balance of the year. Our sales in 2022 declined 8%. We believe it’s fair to say that historic inflation weighed on families with young children by at least 8%.

STRATEGIC PRIORITIES

Prior to the pandemic, Carter’s achieved 31 consecutive years of sales growth. Assuming continued moderation in inflation, improved consumer confidence, and growth in the economy, we are forecasting a return to growth in sales and profitability beginning in 2024.

Our growth strategies are focused on four key priorities:

Lead in eCommerce

Carter’s is the best-selling young children’s apparel brand online in North America. We have unparalleled relationships with leading eCommerce retailers of young children’s apparel, including Amazon, Target, Walmart, Kohl’s, and Macy’s. Together with our wholesale customers, global online retail sales of our brands last year exceeded $1.2 billion.

eCommerce continued to be one of our highest margin businesses in 2022. It contributed 37% of our total U.S. Retail sales. We plan to continue investing in eCommerce and omni-channel capabilities to provide a market-leading and convenient online shopping experience for consumers.

Carter’s is also the largest specialty retail store chain focused on young children’s apparel in North America. Our stores provide convenience for consumers, enabling same-day and curbside pick up of online purchases.

Win in Baby

Carter’s is the best selling brand in the newborn apparel market (ages newborn to 12 months) in the United States, with over five times the market share of the next largest brand. Baby apparel (ages newborn to 24 months) represents over 50% of our total apparel sales. It continued to be our strongest performing product offering last year.

Demographic trends in the United States are favorable. With a peak population of women and men in their late 20s and early 30s, and a nearly 40-year high in weddings last year, the favorable trend in births in recent years may continue in the years ahead. We believe the strength of our brands, product innovation, customer acquisition strategies, and broad market distribution position us well for growth in the baby apparel market.

Age Up

Consumers trust Carter’s for their baby apparel purchases. As their children grow, many parents continue shopping with us and appreciate the strong value our product offerings provide in those early years of life. Carter’s has the leading market share in toddler apparel (ages three and four) and leading share of apparel for five to seven-year-old children. The market for children ages five to 10 years old is larger than the baby and toddler apparel markets combined.

The total addressable apparel market for newborn to 10-year-old children in the United States is over $29 billion. The market is highly fragmented. Over 30% of the market is comprised of brands with less than 1% share. Carter’s share of the market is 70% larger than our nearest competitor.

With the successful extension in the scope and strength of our product offerings, together with our global sourcing and distribution capabilities, we believe we will gain additional share of the young children’s apparel market in the years ahead.

Expand Globally

We have the largest share of the children’s apparel market in Canada, with twice the share of our nearest competitor. In recent years, we have strengthened our leading position in this market by investing in omni-channel capabilities, including same-day and curbside pickup of online purchases, and inventory management and eCommerce capabilities.

In Mexico, we are executing the same strategy that served us well in the United States and Canada by building retail store, eCommerce, and wholesale distribution capabilities. We plan to continue opening co-branded stores with the very best of our Carter’s, OshKosh, and Skip Hop brands and converting our legacy, smaller stores in Mexico to this more productive and profitable model.

Our global distribution capabilities are further strengthened through our relationships with multi-national retailers, including Amazon, Walmart, and Costco and other wholesale partners in over 90 countries.

THE PATH FORWARD

We expect that our growth in the years ahead will be driven by new store openings. Nearly 70% of children’s apparel is purchased in stores. Stores are our highest source of new customer acquisition.

Given our progress with improved price realization, more attractive store opening opportunities in the United States are now available to us. As our competitors downsize given challenges in their businesses, we plan to capture those new market opportunities with what we believe are highly productive specialty stores that provide the best value and experience in young children’s apparel.

We believe our stores enable the success of our eCommerce business. In 2022, 35% of our online transactions were supported by our stores. These are margin accretive transactions and they drive traffic to our stores. In the years ahead, we expect our stores will support a higher percentage of our online transactions. As we grow our physical brand experience, we expect to extend the reach of our brands in new markets and further improve the convenience of shopping in our stores and online.

In the years ahead, we believe our growth in sales will also be driven by our exclusive brands which are sold through some of the most successful retailers in the world - Target, Walmart and Amazon. We believe our exclusive brands are traffic drivers to these retailers and provide product offerings which are complementary to their private label brands.

Last year, our marketing and sales teams worked collaboratively with Target and Walmart to refresh our branding in their stores and on target.com and walmart.com. Every week, over 100 million people shop in Target and Walmart stores. We expect that consumers shopping for young children’s apparel will now see a stronger presentation of our Carter’s brand in those stores in the years ahead.

In international markets, we expect our growth will be driven through new omni-channel capabilities in Canada and Mexico, expansion through our wholesale partner Riachuelo in Brazil, and growth with other wholesale customers.

We expect that our profitability in the years ahead will be driven by a higher mix of omni-channel sales, a better mix of higher margin stores, and a greater concentration of our wholesale business with fewer, stronger and growing retailers. We expect our profitability will also be driven by improved pricing and inventory management capabilities, favorable trends in product costs and ocean freight rates, more effective brand marketing, and continued return of capital through share repurchases.

Over the past 10 years, we distributed nearly $3 billion of excess capital through dividends and share repurchases, which represented over 100% of our free cash flow during that time period. We made good progress with our return of capital initiatives last year, including $300 million in share repurchases. We plan to continue distributing excess capital to our shareholders in the years ahead.

BEST IN CLASS

We believe Carter’s is the best in class in young children’s apparel. Our Carter’s brand is sold in over 20,000 points of distribution globally and on the most successful websites for young children’s apparel.

Carter’s is a market leader. No other company in young children’s apparel has the scope of product offerings, depth of relationships with the winning retailers and a long track record of success, serving the needs of multiple generations of consumers. We believe we have weathered historic market disruptions in recent years better than most, and we are well positioned to benefit from the market recovery in the years ahead.

I want to thank our employees throughout the world who enabled a stronger-than-planned finish to 2022 and for their passion and commitment to our brands and the success of our Company.

On behalf of our employees, board of directors, and leadership team, thank you for your investment in Carter’s.

Sincerely,

Michael D. Casey

Chairman and Chief Executive Officer

TABLE OF CONTENTS

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

This Proxy Statement contains certain forward-looking statements within the meaning of the federal securities laws relating to our future performance, including statements with respect to the Company’s plans to distribute excess capital to investors, the Company’s future outlook, financial results and sales growth, operational challenges, liquidity, strategy, financings, and investments. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” and similar terms. These forward-looking statements are based upon our current expectations and assumptions and are subject to various risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements including, but not limited to, those discussed in the subsection entitled “Risk Factors” under Part I, Item 1A of the Company’s Annual Report on Form 10-K and the following: the effects of the COVID-19 pandemic and macroeconomic factors, including inflationary pressures; financial difficulties for one or more of our major customers; an overall decrease in consumer spending; our products not being accepted in the marketplace; increased competition in the market place; diminished value of our brands; the failure to protect our intellectual property; the failure to comply with applicable quality standards or regulations; pending and threatened lawsuits; a breach of our or our third-party vendor information technology systems; increased margin pressures, including increased cost of materials and labor; our foreign sourcing arrangements; disruptions in our supply chain, including increased transportation and freight costs; our ability to continue to distribute excess capital to our shareholders; our ability to source sustainable materials; the management and expansion of our business domestically and internationally; our ability to achieve our business strategies, including our goals of leading in eCommerce, growing in the baby apparel market, and capturing more market share in older age groups; the acquisition and integration of other brands and businesses; and changes in our tax obligations, including additional customs, duties or tariffs. Actual results, events, and performance may differ significantly from the results discussed in the forward-looking statements. Readers of this Proxy Statement are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except for any ongoing obligations to disclose material information as required by federal securities laws, the Company does not have any intention or obligation to update forward-looking statements after the filing of this Proxy Statement.

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

BOARD OF DIRECTORS

Each of our directors stands for election annually and thereafter holds office for a one-year term. We are asking our shareholders to elect 11 proposed nominees set forth below at the Annual Meeting.

Bruce Cleverly is not seeking re-election pursuant to our Retirement Policy. The Company is grateful to Mr. Cleverly for his many years of service to Carter’s.

Previously, we disclosed our plan to focus on Board candidates with diverse backgrounds. Assuming all of the Company’s nominees are elected at the Annual Meeting, four of our 11 directors will be female and two have self-identified as ethnically or racially diverse. Going forward, the Board plans to continue our focus on candidates with diverse backgrounds, including gender, race and ethnicity. Please see “—Retirement Policy” below for additional information regarding planned Board transition and “—Consideration of Director Nominees” for more information on the Nominating and Corporate Governance Committee’s philosophy and commitment to including in each search candidates who reflect diverse backgrounds.

The Board believes that each director and candidate nominated for election has valuable skills and experiences that, taken together, provide the Company with the variety and depth of knowledge, judgment, and strategic vision necessary to provide effective oversight of the Company’s business operations. Our directors have extensive experience, both domestically and internationally, in different fields, including apparel and retail, consumer products, brand marketing, human capital management, technology, cyber and data security, global sourcing, sustainability, risk management, finance, accounting, and strategy.

The Board also believes that, as indicated in the following biographies, each director has demonstrated significant leadership in positions such as chief executive officer, chief financial officer, division president, and other senior executive positions. In addition, many of our directors have significant experience in the oversight of public companies due to their service as directors of Carter’s and other companies.

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

BOARD LEADERSHIP STRUCTURE

The Company’s Corporate Governance Principles provide that the positions of Chairman of the Board and Chief Executive Officer may be combined if the non-management directors determine it is in the best interest of the Company. In August 2009, the non-management directors appointed Mr. Casey as Chairman of the Board. The Board believes it is appropriate to continue to combine the positions of Chairman and Chief Executive Officer. Mr. Casey has nearly 30 years of management, finance, and administrative leadership experience at the Company. In addition, Mr. Casey has extensive knowledge of, and experience with, all other aspects of the Company’s business, including with its employees, customers, vendors, and shareholders. Having Mr. Casey serve as both Chairman and Chief Executive Officer helps promote unified leadership and direction for both the Board and management.

In connection with Mr. Casey’s appointment as Chairman, the non-management directors also created the position of Lead Independent Director (“Lead Director”). This position was created to, among other things, ensure that the non-management directors maintain proper oversight of management and Board processes. The responsibilities of the Lead Director include:

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

Mr. Montgoris was appointed to serve as Lead Director in May 2022.

DIRECTOR INDEPENDENCE

The New York Stock Exchange (“NYSE”) listing standards and the Company’s Corporate Governance Principles require a majority of the Company’s directors to be independent from the Company and the Company’s management. For a director to be considered independent, the Board must determine that the director has no direct or indirect material relationship with the Company. The Board considers all relevant information provided by each director regarding any relationships each director may have with the Company or management. As a result of this review, our Board has determined that all of our non-management directors (all directors other than Mr. Casey) are independent and meet the independence requirements under the listing standards of the NYSE, the rules and regulations of the SEC, and the Company’s Corporate Governance Principles.

BOARD AND COMMITTEE EVALUATIONS

The Board recognizes that a robust and constructive evaluation process is an essential component of good corporate governance and Board and committee effectiveness. Through this process, directors provide feedback and assess Board, committee and director performance, including areas where the Board believes it is functioning effectively and areas where the Board believes it can improve. The Board and the committees may, from time to time, engage outside third parties to help with this process.

In fiscal 2022, under the leadership of the Lead Director and the Chairperson of the Nominating and Corporate Governance Committee, the Nominating and Corporate Governance Committee oversaw the Board’s annual evaluation process, which focused on the Board and each of the committees, as well as individual peer-to-peer assessments. These assessments included individual interviews with each director with feedback given to each director.

BOARD REFRESHMENT

In 2022, as part of an overall strategy of the Board to continually refresh the members of the Board and the overall skills, experience, background, and diversity of the members of the Board, four new candidates were elected to our Board in connection with our 2022 annual meeting – Rochester (Rock) Anderson, Jr., Jeffrey H. Black, Stacey S. Rauch, and Stephanie P. Stahl. In executing on its Board refreshment process, and assuming all of the Company’s nominees are elected at the Annual Meeting, four of our 11 directors will be female and two have self-identified as ethnically or racially diverse, and the average tenure of our directors standing for re-election is approximately 5.5 years (versus approximately 10.1 years for directors who were serving on the Board immediately prior to the 2022 annual meeting). Going forward, the Board plans to continue to focus on candidates with diverse backgrounds, including gender, race and ethnicity.

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

RETIREMENT POLICY

In February 2019, the Board adopted an amendment to the Company’s Corporate Governance Principles to include a retirement policy. Under this policy, each independent director’s retirement will be automatic at the annual meeting of shareholders following such director reaching the age of seventy five (75), and no person shall be eligible for nomination or election as an independent director after reaching the age of seventy five (75), subject to the following exceptions:

The Board determined that the above exceptions were appropriate in order to promote continuity of experience on the Board in the short-term by allowing Mr. Cleverly and Mr. Montgoris to serve beyond their seventy-fifth (75^th) birthdays if the Nominating and Corporate Governance Committee and the Board determine it is otherwise appropriate. More broadly, the Nominating and Corporate Governance Committee may use reasonable discretion to allow a director to serve past his or her seventy-fifth (75^th) birthday in the future.

BOARD AND ANNUAL MEETINGS

Our Corporate Governance Principles require at least four regularly scheduled Board meetings each year, and each director is expected to attend each meeting. The Board held four regularly scheduled quarterly meetings during fiscal 2022; and held six additional special meetings to discuss Board composition, including director retirements and potential new director candidates, as well as management’s progress against the Company’s annual and long-term plans.

In fiscal 2022, no director participated in less than 75% of the aggregate number of all the Board and applicable committee meetings that they were eligible to attend. Mses. Rauch and Stahl and Messrs. Anderson and Black, all of whom were elected in May 2022, attended all of the Board and their applicable committee meetings which occurred during 2022 after they joined the Board.

Although the Company does not have a policy regarding director attendance at annual meetings of shareholders, all directors are encouraged to attend the Annual Meeting. All of the directors then standing for election attended the Company’s virtual annual meeting of shareholders in fiscal 2022.

EXECUTIVE SESSIONS

Executive sessions of non-management directors are held at least four times a year. Any non-management director can request that additional executive sessions be scheduled. The Lead Director presides at the executive sessions of non-management directors.

BOARD COMMITTEES

Our Board has the following standing committees: Audit, Compensation and Human Capital, and Nominating and Corporate Governance. The charters for each committee are available in the Investor Relations section of our

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

website at ir.carters.com or in print by contacting Mr. Robinson at the Company’s address set forth in the 2023 Notice of Annual Meeting. The Board may also establish other committees to assist in the discharge of its responsibilities.

The table below identifies, for each director standing for re-election at the Annual Meeting, the committee members and committee chairperson (as indicated by a “C”) for each of the Board’s committees as of the Record Date. The Board, with the guidance of the Nominating and Corporate Governance Committee, expects to evaluate committee compositions after the Annual Meeting and will consider each independent Board member’s experience and skills as part of this evaluation.

AUDIT COMMITTEE

During fiscal 2022, the members of the Audit Committee were Mses. Schar and Rauch (who joined in May 2022), and Messrs. Black (who joined in May 2022), Borgen, and Hipp. Ms. Schar serves as chairperson. During fiscal 2022, the Audit Committee held 8 meetings.

The Audit Committee is responsible for, among other things, oversight of:

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

The Audit Committee operates pursuant to a written charter that addresses the requirements of the NYSE listing standards. The Board has determined that each member of the Audit Committee during fiscal 2022 was, and as currently structured is, independent pursuant to applicable NYSE and SEC rules and meets the financial literacy requirements, each as set forth in the NYSE’s listing standards. The Board has also determined that each of Ms. Schar and Messrs. Black and Borgen is an “audit committee financial expert” as defined under SEC rules.

The Audit Committee Report is included in this proxy statement on page 49.

COMPENSATION AND HUMAN CAPITAL COMMITTEE

During fiscal 2022, the members of the Compensation and Human Capital Committee were Messrs. Anderson (who joined in May 2022), Borgen, Eagle, Hipp, and Ms. Stahl (who joined in May 2022). Mr. Eagle serves as chairperson. During fiscal 2022, the Compensation and Human Capital Committee held eight meetings. In addition to the four regularly scheduled meetings, additional meetings were held to discuss talent management, including succession planning.

The Compensation and Human Capital Committee is responsible for, among other things:

The Compensation and Human Capital Committee operates pursuant to a written charter that addresses the requirements of the NYSE’s listing standards. The Board has determined that each member of the Compensation and Human Capital Committee during fiscal 2022 was, and as currently structured is, independent as defined under NYSE and SEC rules.

This year’s Compensation and Human Capital Committee Report is included in this proxy statement on page 30.

The CD&A, which begins on page 19, discusses how the Compensation and Human Capital Committee makes compensation-related decisions regarding our Named Executive Officers (“NEOs”).

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

Compensation and Human Capital Committee Interlocks and Insider Participation

None of the members of our Compensation and Human Capital Committee serving during fiscal 2022 has been an officer or other employee of the Company. None of our executive officers has served as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board.

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

During fiscal 2022, the members of the Nominating and Corporate Governance Committee were Mses. Borenstein, Rauch (who joined in May 2022), and Stahl (who joined in May 2022), and Messrs. Cleverly and Montgoris. Mr. Montgoris serves as chairperson. During fiscal 2022, the Nominating and Corporate Governance Committee held seven meetings.

The Nominating and Corporate Governance Committee is responsible for, among other things:

The Nominating and Corporate Governance Committee operates pursuant to a written charter that addresses the requirements of the NYSE’s listing standards. The Board has determined that each member of the Nominating and Corporate Governance Committee during fiscal 2022 was, and as currently structured is, independent as defined in the NYSE’s listing standards.

CONSIDERATION OF DIRECTOR NOMINEES

The Nominating and Corporate Governance Committee regularly assesses the appropriateness of the size of the Board. In the event that vacancies occur or are anticipated, the Nominating and Corporate Governance Committee will consider prospective nominees that come to its attention through current Board members, search firms, or other sources.

The Board believes that it is appropriate to limit the group of shareholders who can propose nominees due to time constraints on the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee will consider persons recommended by shareholders who hold more than 1% of our common stock for inclusion as nominees for election to the Board if the names of such persons are submitted to Mr. Robinson at the Company’s address set forth in the 2023 Notice of Annual Meeting. This submission must be made in writing and in accordance with our by-laws, including mailing the submission in a timely manner and maintaining share ownership at the time of the applicable annual meeting, and the submission must include the nominee’s name, address, and qualifications for Board membership.

When evaluating a potential candidate for membership on the Board, including candidates properly submitted by shareholders, the Nominating and Corporate Governance Committee considers each candidate’s skills and experience and assesses the needs of the Board and its committees at that point in time. Consistent with this philosophy, the Nominating and Corporate Governance Committee is committed to including in each search candidates who reflect diverse backgrounds, including diversity of gender, ethnicity and race, and seeks to have Board members with diverse backgrounds, experiences, and points of view. In connection with its assessment of all prospective nominees, the

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

Nominating and Corporate Governance Committee will determine whether to interview such prospective nominees, and if warranted, one or more members of the Nominating and Corporate Governance Committee, and others as appropriate, will interview such prospective nominees in person or by telephone or virtual meeting. Once this evaluation is completed, if warranted, the Nominating and Corporate Governance Committee selects the nominees and recommends to the Board that they be nominated for election by shareholders at the annual meeting.

SHAREHOLDER COMMUNICATION WITH DIRECTORS

A shareholder or other interested party may submit a written communication to the Board, the Lead Director, or other individual non-management directors. The submission must be delivered to Mr. Robinson at the Company’s address set forth in the 2023 Notice of Annual Meeting.

The Board, the Lead Director, or other non-management directors may require the submitting shareholder to furnish such information as may be reasonably required or deemed necessary to sufficiently review and consider the submission of such shareholder.

Each submission will be forwarded, without editing or alteration, to the Board, the Lead Director, or individual non-management directors, as appropriate, at, or prior to, the next scheduled meeting of the Board. The Board or the Lead Director, as appropriate, will determine, in their sole discretion, the method by which such submission will be reviewed and considered.

RISK OVERSIGHT

The Company’s management is responsible for identifying, assessing, managing, and mitigating the Company’s strategic, financial, operational, and compliance risks. The chart below provides an overview of the Board’s and its committees’ risk oversight responsibilities.

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE INFORMATION

The Board and its committees receive updates from senior management on relevant risks and management efforts in these areas at Board and committee meetings at least annually and more frequently, as appropriate.

Information Security Oversight

The Audit Committee provides oversight of the Company’s information security initiatives. Management reports to the Audit Committee on information security matters, generally on a quarterly basis.

Our information security initiatives are led internally by our Senior Vice President & Chief Information Officer, who reports to our Executive Vice President & Chief Financial Officer and include a comprehensive information security training and compliance program. External firms assist the Company in the independent evaluation of its information security processes.

ESG Oversight

We believe a strong management team and governance are essential to demonstrating accountability and driving our desired results when it comes to important ESG matters, including climate change, product quality and safety, workers’ rights, product design and innovation, supply chain management, and employee engagement.

The Nominating and Corporate Governance Committee provides oversight of the Company’s ESG initiatives. Management reports to the Nominating and Corporate Governance Committee on ESG matters on a quarterly basis. Our ESG initiatives are led internally by our Senior Vice President, General Counsel, Secretary, Corporate Social Responsibility & Chief Compliance Officer, who reports directly to our Chairman and Chief Executive Officer. Our Corporate Social Responsibility executive is supported by the Company’s ESG Council, which includes employees from across the Company’s business. The Company’s ESG initiatives are implemented by various departments within the Company.

More information about our ESG efforts can be found at www.carters.com/esg (the contents of which are not incorporated by reference into this proxy statement).

Compensation Program Risk Assessment

As part of its oversight role, the Compensation and Human Capital Committee considers the impact of our compensation program, policies and practices (both at the executive and below-executive levels), on the Company’s overall risk profile. Specifically, the Compensation and Human Capital Committee, with assistance from our CEO, reviews the Company’s compensation policies and practices, discusses and reviews whether the incentive compensation arrangements for the CEO promote appropriate approaches to the taking and management of risk, and, specifically, do not encourage executive officers to take unnecessary and excessive risks. We believe that our pay program provides an effective balance in cash and equity and a mix of short- and longer-term performance periods, and also allows for the Compensation and Human Capital Committee’s to approve payouts. Based on the Compensation and Human Capital Committee’s most recent review, the Compensation and Human Capital Committee determined that the risks arising from the Company’s compensation policies and practices are not reasonably likely to have a material adverse effect on the Company.

CORPORATE GOVERNANCE PRINCIPLES AND CODE OF ETHICS

The Company is committed to conducting its business with the highest level of integrity and maintaining the highest standards of corporate governance. Our Corporate Governance Principles and Code of Ethics provide the structure within which our Board and management operate the Company. The Company’s Code of Ethics applies to all directors and Company employees, including each of the Company’s executive officers. Our Corporate Governance Principles and Code of Ethics are available in the Investor Relations section of our website at ir.carters.com or in print by contacting Mr. Robinson at the Company’s address set forth in the 2023 Notice of Annual Meeting.

PROPOSAL NUMBER ONE — ELECTION OF DIRECTORS

The Board proposes that the following 11 director nominees be elected to the Board to serve until the next annual meeting in 2024, or until his or her earlier resignation, death, or removal. Each nominee is listed below, along with their age as of the date of the Annual Meeting. For more information about each of the director nominees, including individual biographies. Please see “Board of Directors and Corporate Governance Information—Board of Directors.”

The Board recommends a vote FOR the election of each of the director nominees listed above.

VOTE REQUIRED

Pursuant to our by-laws and our Corporate Governance Principles, the number of votes properly cast “for” a director nominee must exceed the aggregate number of votes cast “against” that nominee and shares to which the holder “abstains” with respect to that nominee for that nominee to be elected. Abstentions and broker non-votes will be counted towards a quorum, and abstentions will have the practical effect of a vote “against” a director nominee. Broker non-votes are not considered shares entitled to vote in the election of directors.

Any nominee who is an existing director who does not receive a majority of votes cast “for” their election is required to tender his or her resignation for consideration by the Board. The Nominating and Corporate Governance Committee is then required to make a recommendation to the Board as to whether it should accept or reject such resignation. The Board, taking into account such recommendation, will decide whether to accept such resignation. The Board’s decision will be publicly disclosed within ninety (90) days after the results of the election are certified. A director whose resignation is under consideration shall abstain from participating in any recommendation or decision regarding his or her resignation. If the resignation is not accepted, the director will continue to serve until the next annual meeting of shareholders and until such director’s successor is elected and qualified.

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COMPENSATION OF DIRECTORS

When they are initially appointed to the Board, each of our non-management directors receives a one-time restricted stock grant, equal to the value of the annual retainer, that cliff vests after three years. Thereafter, each of our non-management directors receives an annual cash retainer and an annual stock award, and each of our committee chairpersons and our Lead Director receives an additional annual retainer. Non-management directors also receive fees for each meeting they attend.

For fiscal 2022, each director’s annual retainer was comprised of an $85,000 cash payment and an immediately vested grant of our common stock valued at approximately $155,000. In addition to the annual retainer:

We also reimburse directors for travel expenses incurred in connection with attending Board and committee meetings and for other expenses incurred while conducting Company business.

Mr. Casey receives no additional compensation for serving on the Board.

The following table provides information concerning the compensation of our non-management directors serving during fiscal 2022.

FISCAL 2022 DIRECTOR COMPENSATION TABLE^(a)

COMPENSATION OF DIRECTORS

For complete beneficial ownership information of our common stock for each director, see the information presented below the heading “Securities Ownership of Beneficial Owners, Directors, and Executive Officers” on page 45.

In November 2020, the Board approved a deferred compensation program for non-management directors, under which, beginning in 2021, directors may opt to defer cash retainer payments and stock grants in the form of deferred stock units until the fifth anniversary of the grant date or until the director leaves the Board.

Under the Company’s minimum ownership guidelines, no director may sell Company stock unless he or she owns shares of Company stock with a total market value in excess of five times his or her annual cash retainer, or $425,000, by the end of his or her sixth year of service on the Board. Each of our directors complied with these ownership guidelines in fiscal 2022.

There are no family relationships among any of the directors or our executive officers and none of our non-management directors performed any services for the Company other than services as directors.

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EXECUTIVE OFFICERS’ BIOGRAPHICAL INFORMATION AND EXPERIENCE

The following table sets forth the name, age, and position of each of our executive officers as of the Annual Meeting date.

Michael D. Casey joined the Company in 1993 as Vice President of Finance. Mr. Casey was named Senior Vice President of Finance in 1997, Senior Vice President and Chief Financial Officer in 1998, Executive Vice President and Chief Financial Officer in 2003, and Chief Executive Officer in 2008. Mr. Casey became a director in 2008 and was named Chairman of the Board of Directors in 2009. Prior to joining the Company, Mr. Casey worked for Price Waterhouse LLP, a predecessor firm to PricewaterhouseCoopers LLP, from 1982 to 1993.

Brian J. Lynch joined the Company in 2005 as Vice President of Merchandising. Mr. Lynch was named Senior Vice President in 2008. In 2009, Mr. Lynch was named Executive Vice President and Brand Leader for Carter’s. In 2012, Mr. Lynch was named President. In 2022, he was named President and Chief Operating Officer. Prior to joining the Company, Mr. Lynch was with The Walt Disney Company from 1995 to 2005 in various merchandising, brand management, and strategy roles in the Disney Parks & Resorts division. Prior to Disney, Mr. Lynch worked for Champion, a division of Hanesbrands Inc., where he held finance, sales management, and marketing positions.

Julie A. D’Emilio joined the Company in 2006 as Vice President of Sales. Ms. D’Emilio was named Senior Vice President of Sales in 2013, and then Executive Vice President, Sales in 2016. In 2020, Ms. D’Emilio was appointed Executive Vice President, Global Sales. Prior to joining the Company, Ms. D’Emilio was with Calvin Klein Jeans, a division of The Warnaco Group, Inc., in various management positions, including Executive Vice President of Juniors’ and Girls, and Vice President of the Women’s Division. Ms. D’Emilio began her career with Liz Claiborne Inc. and also worked for London Fog Industries, Inc. and Jones Apparel Group, a predecessor of The Jones Group, Inc.

Jeffrey M. Jenkins joined the Company in 2019 as Executive Vice President, Global Marketing. From July 2017 to July 2019, Mr. Jenkins was with CKE Restaurants Holdings, Inc., the parent company of the Carl’s Jr. and Hardee’s fast food restaurant brands, serving most recently as Global Chief Digital Officer and previously as Chief Marketing Officer. From June 2015 to July 2017, Mr. Jenkins was with Whole Foods Market, Inc. as Vice President, Digital Marketing & Channel Activation and Vice President, Digital Strategy & Marketing. From 2008 to June 2015, Mr. Jenkins was with Yum! Brands, Inc. in marketing roles of increasing responsibility.

Kendra D. Krugman joined the Company in 2007 as Manager, Merchandising. Ms. Krugman was named Director, Merchandising in 2008, Vice President Sales and Merchandising, Mass Channel in 2012, Senior Vice President Carter’s Brands and Licensing in 2016, Executive Vice President, Merchandising & Design in July 2018, and Executive Vice President, Retail and Chief Merchandising Officer in March 2023. Prior to joining the Company, Ms. Krugman held positions at The Gap, Inc. and French Connection Group PLC.

EXECUTIVE OFFICERS’ BIOGRAPHICAL INFORMATION AND EXPERIENCE

Benjamin L. Pivar joined the Company in 2015 as Vice President Information Technology (IT) Supply Chain. Mr. Pivar was named Vice President Retail IT in 2017, Vice President & Chief Information Officer in 2018, and Senior Vice President & Chief Information Officer in 2019. Prior to joining the Company, Mr. Pivar spent 12 years at Capgemini, most recently as Senior Vice President, North America Retail Lead.

Antonio D. Robinson joined the Company in 2010 as Vice President, Associate General Counsel. Mr. Robinson was named Vice President, Deputy General Counsel & Chief Compliance Officer in 2019; Senior Vice President, Corporate Social Responsibility in 2020; and Senior Vice President, General Counsel, Secretary, Corporate Social Responsibility & Chief Compliance Officer in 2023. Prior to joining the Company, Mr. Robinson was a shareholder and attorney in private practice in the Atlanta office of Littler Mendelson P.C.

Karen G. Smith joined the Company in 2022 as Executive Vice President, Supply Chain. From 2019 to 2022, Ms. Smith was with Kontoor Brands, inc. (“Kontoor”), serving most recently as Executive Vice President of Supply Chain and previously as Vice President of Global Supply Chain Operations, a role she assumed after Kontoor’s 2019 spinoff from V.F. Corporation. From 2014 to 2019, she was with V.F. Corporation in various management positions, including Vice President, Supply Chain Operations, Americas East. Prior to V.F. Corporation, Ms. Smith worked for Jockey International in supply chain leadership roles of increasing responsibility.

Richard F. Westenberger joined the Company in 2009 as Executive Vice President & Chief Financial Officer. Mr. Westenberger’s responsibilities include management of the Company’s finance, information technology, and enterprise risk management functions. Prior to joining the Company, Mr. Westenberger served as Vice President of Corporate Finance and Treasurer of Hewitt Associates, Inc. from 2006 to 2008. From 1996 to 2006, Mr. Westenberger held various senior financial management positions at Sears Holdings Corporation and its predecessor organization, Sears, Roebuck and Co., including Senior Vice President & Chief Financial Officer of Lands’ End, Inc., Vice President of Corporate Planning & Analysis, and Vice President of Investor Relations. Prior to Sears, Mr. Westenberger was with Kraft Foods, Inc. He began his career at Price Waterhouse LLP, a predecessor firm to PwC, and is a certified public accountant.

Jill A. Wilson joined the Company in 2009 as Vice President of Human Resources. In 2010, Ms. Wilson was promoted to Senior Vice President, Human Resources & Talent Development. Ms. Wilson joined the Company after more than 20 years with The May Company and Macy’s, Inc. While at Macy’s, Ms. Wilson held various human resource positions of increasing responsibility, including Group Vice President of Human Resources. Ms. Wilson has extensive experience in a broad range of human resource disciplines including global talent management, organizational development, learning and development, compensation, benefits, talent acquisition, and merger integration.

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COMPENSATION DISCUSSION AND ANALYSIS

OVERVIEW

This Compensation Discussion and Analysis, or CD&A, is intended to provide information regarding the Company’s executive compensation program and practices. This CD&A covers a variety of topics, including the Company’s compensation philosophy regarding executive compensation, the role of our Compensation and Human Capital Committee (also referred to in this CD&A as the Committee), in setting the compensation of our executive officers, including our NEOs, and our executive compensation decisions for fiscal 2022.

Our NEOs for fiscal 2022 were:

Each of our NEOs was employed by the Company in their respective roles for all of fiscal 2022 except for Mr. Lynch. Mr. Lynch was appointed to the additional role of Chief Operating Officer in February 2022. Ms. Krugman was promoted from Executive Vice President, Merchandising and Design (a role in which she served for all of fiscal 2022) to Executive Vice President, Retail and Chief Merchandising Officer in March 2023. Mr. Moore terminated employment with the Company effective March 17, 2023.

OVERVIEW OF EXECUTIVE COMPENSATION DECISIONS FOR FISCAL 2022

This CD&A presents information regarding the Committee’s consideration of the Company’s performance in 2022 and related compensation decisions.

Decisions with respect to 2022 compensation programs were made early in 2022. In the early months of 2022, business trends were favorable. Management forecasted growth in sales and earnings, building on the strong recovery in consumer demand and record earnings achieved in 2021, following the most disruptive period of the pandemic in 2020.

In the Spring of 2022, rapid inflation began to weigh on Carter’s target consumers (household income ~$75,000) and demand for children’s apparel. By June of 2022, inflation peaked at 9%, a 41-year high, which slowed the U.S. economy and demand for the Company’s product offerings in the balance of the year.

Beginning in the second quarter of 2022, many of the Company’s largest Wholesale customers reduced or cancelled the planned receipt of our product offerings to address slower than expected consumer demand and to reduce their exposure to excess inventories.

Inflation also impacted many of the Company’s costs of operation including product sourcing, labor, transportation, distribution, and marketing.

2022 COMPANY PERFORMANCE HIGHLIGHTS

COMPENSATION DISCUSSION AND ANALYSIS

EXECUTIVE COMPENSATION HIGHLIGHTS FOR FISCAL 2022

The Compensation and Human Capital Committee believes that our executive compensation program is appropriately designed to attract and retain superior executive talent and to drive performance. As described more fully in this CD&A, the Committee took the following actions, among others, with respect to fiscal 2022 compensation for our NEOs:

COMPENSATION GOVERNANCE

The Compensation and Human Capital Committee and the Board of Directors have established executive compensation-related policies and procedures, including those discussed below, that they believe are appropriate for the Company and its shareholders in light of the industries in which the Company operates, its business model, and its financial and operational performance.

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COMPENSATION DISCUSSION AND ANALYSIS

COMPENSATION PHILOSOPHY

COMPENSATION STRUCTURE AND DETERMINATION

Our compensation philosophy is to set our NEOs’ total direct compensation at levels that will attract, motivate, and retain superior executive talent in a highly competitive environment. The Company’s compensation program for our NEOs is designed to support these objectives and encourage strong financial performance on an annual and long-term basis by linking a significant portion of our NEOs’ total direct compensation to Company performance in the form of annual cash incentive compensation and long-term performance stock.

The principal components of the compensation structure for our NEOs are:

Together, the Company refers to these three components as “total direct compensation.”

General

In setting a total direct compensation target for each NEO, our Compensation and Human Capital Committee considers both the objective and subjective factors set forth below. The Committee also reviews total direct compensation, and its individual components, at the 25th, 50th, and 75th percentile levels paid to executives in similar positions at the companies in our peer group and, as needed, a broader retail survey, in order to understand where the compensation it sets falls relative to market practices. These levels are selected because

COMPENSATION DISCUSSION AND ANALYSIS

the Committee reviews this peer data as a reference point in determining whether the total compensation opportunity is likely to provide sufficient motivation and retention as well as whether it properly reflects the NEO’s role and scope of responsibilities.

In setting compensation of all NEOs, the Committee considered multiple objective and subjective factors, including:

BASE SALARY

When setting base salaries for our NEOs, our Compensation and Human Capital Committee considers the objective and subjective factors set forth above and also reviews base salaries at the 25th, 50th, and 75th percentile levels paid to executives in similar positions at the companies in our peer group and a broader retail survey, as appropriate.

ANNUAL CASH INCENTIVE COMPENSATION

The Company makes annual cash incentive compensation (through our Incentive Compensation Plan) a significant component of our NEOs’ targeted total direct compensation in order to motivate our executive officers to meet and exceed the Company’s annual operating plans. For each NEO, our Compensation and Human Capital Committee approves target annual cash incentive compensation as a percentage of such NEO’s base salary. In establishing these annual cash incentive compensation targets, the Committee considers our NEOs’ potential total direct compensation in light of the Company’s compensation philosophy and comparative compensation data.

The Committee has the discretion to reduce or not to award annual cash incentive compensation, even if the Company achieves its financial performance targets, and to take into account personal performance in determining the percentage of each NEO’s annual cash incentive compensation to be paid, if any. For example, the Committee has discretion to reduce future incentive compensation awards based on financial restatements or misconduct. In addition, the Board has adopted a policy for the recovery of cash and equity performance-based compensation from executives (these are generally referred to as “recoupment” or “clawback” policies). The policy provides that the Board may require an executive to reimburse or forfeit a performance-based award or repay performance-based compensation if the Company is required to prepare a financial reporting restatement as a result of misconduct, if such executive knowingly caused or failed to prevent such misconduct. We intend to adopt a clawback policy responsive to the recently published SEC and stock exchange listing requirements on compensation recovery within the timeframe mandated by those requirements.

LONG-TERM EQUITY INCENTIVE COMPENSATION

Our Equity Incentive Plan allows for various types of equity awards, including stock options, restricted stock (both time and performance-based), restricted stock units, stock appreciation rights, and deferred stock. Awards under our Equity Incentive Plan are granted to recruit, motivate, and retain employees and in connection with promotions or increased responsibility. Approximately 123 employees are eligible for participation in our Equity Incentive Plan. Historically, our Compensation and Human Capital Committee has awarded a combination of time-based stock options, time and performance-based restricted stock, and time-based restricted stock units, although it may choose to use other forms of equity awards in the future.

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COMPENSATION DISCUSSION AND ANALYSIS

All awards under our Equity Incentive Plan must be approved by the Committee. The Committee determines the type, timing, and amount of equity awards granted to each of our NEOs after considering their previous equity awards, base salary, and target annual cash incentive compensation in light of the Company’s compensation philosophy. The Committee also considers the comparative compensation data in our peer group and, as needed, a broader retail survey, and our desire to retain and motivate our NEOs and to align their goals with the long-term goals of our shareholders.

The Committee’s practice is to approve equity grants at regularly scheduled meetings, but may also make equity grants at special meetings or by unanimous written consent, and could select a date subsequent to a regularly scheduled meeting on which to grant equity awards. The exercise prices of equity awards are set at the closing price of our common stock on the NYSE on the date of grant.

In considering the value of equity awards, we calculate the value of time-based and performance-based restricted stock awards using the closing price of our common stock on the date of grant.

ROLE OF THE COMPENSATION AND HUMAN CAPITAL COMMITTEE, INDEPENDENT CONSULTANT AND MANAGEMENT

Our Compensation and Human Capital Committee sets the total direct compensation of our NEOs, as well as the financial performance targets for our NEOs’ annual cash incentive compensation and vesting terms for their equity awards, including performance-based awards.

For fiscal 2022, the Committee engaged Meridian Compensation Partners, LLC, an independent compensation consultant (“Meridian”), to advise it on executive and director compensation matters.

Meridian informs the Committee on market trends, as well as regulatory issues and developments and how they may impact the Company’s executive compensation program. Among other things, Meridian also:

Meridian serves at the discretion of the Committee and regularly attended executive sessions with the Committee at which management was not present. At the direction of the Committee, our Chief Executive Officer worked with Meridian to review comparative compensation data and made recommendations for base salary, annual cash incentive compensation, and long-term equity incentive compensation for our NEOs, other than himself. Compensation for our Chief Executive Officer is set by the Committee, without any involvement by the Chief Executive Officer and reflecting feedback provided by Meridian to the Committee.

The Committee has assessed the independence of Meridian Compensation Partners, LLC pursuant to applicable NYSE and SEC rules and has determined that it is independent, and the work provided by it did not raise a conflict of interest.

PEER GROUP ANALYSIS AND RETAIL SURVEY

To assess the market competitiveness of our NEOs’ compensation, the Compensation and Human Capital Committee and management review data provided by Meridian from two sources: our peer group and, as needed, a broader retail survey.

Our Compensation and Human Capital Committee has established a peer group, which is generally comprised of companies in the retail or wholesale industries which primarily conduct business in apparel or related accessories,

COMPENSATION DISCUSSION AND ANALYSIS

sell products under multiple brands through retail and outlet stores, and have net sales generally between one-half and two times the Company’s net sales. In setting fiscal 2022 compensation, our peer group was comprised of the following fifteen companies:

The Committee, with the advice of Meridian, also uses select information from a broader retail survey (that includes apparel and related products retailers or department stores who primarily sell apparel and related products) for executive compensation market assessment in order to supplement compensation data provided by the peer group analysis for roles outside of the Chief Executive Officer, Chief Financial Officer, and President that may not be adequately represented in the data that is available from our peer group.

SAY-ON-PAY RESULTS

At the 2022 Annual Meeting of shareholders, approximately 96% of the votes cast were in favor of the advisory vote to approve executive compensation. While this vote was advisory and not binding, the Compensation and Human Capital Committee carefully considered the result of the say-on-pay vote in the context of our overall compensation philosophy, as well as our compensation policies and decisions. After reflecting on the say-on-pay vote, our Compensation and Human Capital Committee decided that no changes to the compensation philosophy was necessary. At the Annual Meeting, the Company will have an annual advisory vote to approve executive compensation (Proposal Number Two). The Committee plans to continue to consider the results from this year’s and future advisory votes on executive compensation.

2022 TOTAL DIRECT COMPENSATION

During fiscal 2022, our Compensation and Human Capital Committee reviewed compensation data from our peer group and, as needed, a broader retail survey, and compared that data to the compensation of our NEOs. The Committee’s NEO compensation decisions were made in the first quarter of 2022. Those decisions gave consideration to the Company’s record profitability in 2021 and the Company’s recovery from the global pandemic. The Company and its employees overcame significant challenges, including supply chain and transportation disruptions caused by the emergence of new COVID-19 variants. The Committee recognized these efforts and considered them in the approval of the 2022 compensation programs.

The components of total direct compensation are discussed more fully below.

2022 BASE SALARY

In February 2022, the Compensation and Human Capital Committee approved an increase in the base salaries for each of our NEOs, with such increases effective in May 2022. These increases were based on market data, the nature and scope of each NEO’s responsibilities, and each NEO’s performance during fiscal 2021. The base salary for each NEO for fiscal 2022 is set forth below.

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COMPENSATION DISCUSSION AND ANALYSIS

The total salary for each NEO in fiscal 2022 is shown in the Summary Compensation Table in the “Salary” column and takes into account the change in each NEO’s salary in May 2022.

2022 ANNUAL CASH INCENTIVE COMPENSATION

In February 2022, our Compensation and Human Capital Committee set the following fiscal 2022 annual cash incentive compensation targets for our NEOs: 150% of base salary for Mr. Casey, 100% for Mr. Lynch, and 75% for Mr. Westenberger, Ms. Krugman, and Mr. Moore based on each NEO’s responsibilities, expected contribution and market data. In accordance with our Incentive Compensation Plan, for fiscal 2022, the Committee established two financial performance metrics to determine the amount, if any, of annual cash incentive compensation to be paid under our Incentive Compensation Plan: net sales (weighted at 40%) and operating income, as adjusted, if applicable, in the same manner as for presentation to the financial markets (weighted at 60%). (Please see additional information in our quarterly and fiscal year earnings releases for how adjusted operating income is determined. Adjusted operating income for fiscal 2022 was used for the purposes of determining our NEOs’ compensation.) The Committee selected net sales and operating income (as it may be adjusted and reported to the financial markets) as performance metrics because it believes these metrics are key measures that are aligned with the interests of our shareholders and provide a means to measure the quality of our earnings. As described below, our NEOs could have earned from 0% to 200% of their target annual cash incentive compensation in fiscal 2022 based upon the Company’s achievement of net sales and operating income (as it may be adjusted) financial performance metrics. The payment grid for the 2022 annual incentive compensation program is set forth below.

2022 ANNUAL CASH INCENTIVE COMPENSATION — PERFORMANCE METRICS

In February 2023, the Compensation and Human Capital Committee determined that the Company did not achieve its threshold performance targets, which were set at $3,295 million for net sales and $450 million for adjusted operating income, due to the significant impact of historic inflation on consumer spending and lower wholesale and retail customer demand, as well as the effects of supply chain disruptions. As a result, our NEOs were awarded 0% of their annual cash incentive compensation targets for fiscal 2022 under the Company’s annual incentive compensation program.

In January 2023, the Committee considered the impact of historic inflation and management’s efforts throughout the year to address supply chain challenges and decreased consumer and wholesale demand, as well as the improvements achieved in the Company’s supply chain which began in the first half of the year and continued to improve throughout the balance of the year. The Committee also considered the effects of the Company’s structural improvements in response to consumer demand and supply chain challenges and determined that management had responded appropriately to these historic challenges. Considering the Committee’s overall compensation philosophy that, in part, seeks to attract and retain superior executive talent and to drive performance, the Committee determined that it was appropriate to pay a discretionary annual cash incentive compensation payment to our NEOs for fiscal 2022 at 25% of target. These discretionary bonus payments to the NEOs for fiscal 2022 are shown in the Summary Compensation Table in the “Bonus” column and are as follows.

COMPENSATION DISCUSSION AND ANALYSIS

2022 LONG-TERM EQUITY INCENTIVE COMPENSATION

The discussion below includes information regarding:

Long-Term Equity Incentive Compensation Awarded in 2022. In February 2022, our Compensation and Human Capital Committee approved a 50%-50% mix of annual time-based restricted stock grants and three year performance-based restricted stock grants for each NEO. These grants represented a return to the Company’s historical practice of awarding a combination of time-based and performance-based restricted stock to the Company’s NEOs.

All of the time-based restricted stock awards granted to our NEOs in fiscal 2022:

Each NEO’s performance-based restricted stock granted in February 2022 is eligible to vest following completion of a three-year performance period through fiscal 2024. The amount vested varies based on the Company’s achievement of certain growth targets set for each of fiscal 2022, fiscal 2023, and fiscal 2024 net sales and earnings per share (as adjusted and reported to the Company’s shareholders) and may range between 0% (assuming failure to achieve threshold performance) and 200%.

In considering the value of equity awards, the Company calculates the value of time-based and performance-based restricted stock awards using the closing price of our common stock on the date of grant.

The following table details the number of time-based restricted shares and performance-based restricted shares underlying the grants to each of our NEOs for fiscal 2022. A more detailed description of such grants can be seen below in the table “Fiscal 2022 Grants of Plan-Based Awards” and its footnotes.

Certifying Performance Under February 2020 Performance-Based Restricted Stock: In February 2023, the Committee also certified that the threshold performance for net sales and operating income (as adjusted for items judged to be infrequent or unusual in nature) were not met under the performance-based restricted stock granted in February 2020. As a result, no shares vested under the performance-based restricted stock awarded to the NEOs in February 2020.

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COMPENSATION DISCUSSION AND ANALYSIS

STOCK OWNERSHIP GUIDELINES AND EQUITY RETENTION POLICY

Our Compensation and Human Capital Committee regularly reviews the equity ownership of our NEOs compared to the Company’s minimum ownership guidelines. Under the Company’s minimum ownership guidelines, no NEO may sell shares of Company stock (other than to cover the tax obligations resulting from the vesting of Company restricted stock or from exercising vested stock options) until they own shares of Company stock with a total market value in excess of a specified multiple of his or her base salary and continue to maintain such level of ownership after such sale. For fiscal 2022 (similar to the multiples for 2021), the ownership multiples for our NEOs were as follows:

Our equity retention policy for NEOs requires that any time-based restricted stock granted to a NEO be held for four years following the date of grant before those shares may be sold, except for any withholding to cover tax obligations resulting from the vesting of such shares. The policy also requires that shares underlying time-based options granted be held for at least one year from the date of vesting. During fiscal 2022, each of our NEOs was in compliance with his or her applicable minimum ownership requirement.

401(K) PLAN

The Company’s 401(k) matching program provides Company matching of employee contributions, including contributions by NEOs, at the discretion of the Company, based on the Company’s performance. In January 2023, the Compensation and Human Capital Committee approved that employee contributions made to the Company’s 401(k) plan in fiscal 2022 would be matched by the Company 100% up to 4% of the employee’s eligible compensation for all eligible employees, up to the maximum amount permitted by the Internal Revenue Service. This matching contribution was approved by the Compensation and Human Capital Committee following its consideration of the Company’s employees’ efforts in delivering financial and operating performance during a time of significant inflationary pressures which resulted in decreased demand for, and increased cost of, the Company’s products which are sold through its wholesale customers’ and its own retail stores and eCommerce sites; as well as the Company’s response to historic supply chain disruptions in production and transportation of the Company’s products.

PERQUISITES AND OTHER BENEFITS

Our NEOs do not receive any perquisites or other benefits on an annual basis that are not otherwise available to all employees. The cost of providing these benefits and perquisites to the NEOs is included in the amounts shown in the “All Other Compensation” column of the Summary Compensation Table and detailed in the footnotes to such table.

ACCOUNTING AND TAX CONSIDERATIONS

Accounting, tax, and related financial implications to the Company and our NEOs are considered during the analysis of our compensation and benefits program and individual elements of each. Overall, the Compensation and Human Capital Committee seeks to balance attainment of our compensation objectives with the need to maximize current tax deductibility of compensation that may impact earnings and other measures of importance to shareholders. In general, base salary, annual cash incentive bonus payments, and the costs related to benefits and perquisites are recognized as compensation expense at the time they are earned or provided. Share-based compensation expense is recognized over the vesting period in our consolidated statements of operations for stock options and restricted stock (both time and performance-based).

COMPENSATION DISCUSSION AND ANALYSIS

CLAWBACK AND HEDGING POLICIES

The Board has a policy for the recovery of cash and equity performance-based compensation from executives (these are generally referred to as “recoupment” or “clawback” policies). The policy provides that the Board may require an executive to reimburse or forfeit a performance-based award or repay performance-based compensation if the Company is required to prepare a financial reporting restatement as a result of misconduct, if such executive knowingly caused or failed to prevent such misconduct.

Further, hedging and pledging of Company stock by any Board member or employee of the Company, including our NEOs, is prohibited under the Company’s policies to ensure that the interests of the holders of Company stock are fully aligned with those of shareholders in general. During fiscal 2022, none of our NEOs entered into a hedging arrangement or pledged any shares of Company stock.

We intend to adopt a clawback policy responsive to the recently published SEC and proposed stock exchange listing requirements on compensation recovery within the timeframe mandated by those requirements.

SEVERANCE AGREEMENTS WITH NEOS

Each of our NEOs has a severance agreement with the Company. In the event that an NEO is terminated by the Company for “cause,” retires, becomes disabled, or dies, the executive or his or her estate will be provided the executive’s base salary and medical and other benefits through the termination of his or her employment.

If an NEO is terminated without “cause,” or an NEO terminates their employment for “good reason” (with “cause” and “good reason” defined in each executive’s respective severance agreement and summarized below) the Company will be obligated to pay such executive’s base salary for 24 months in the case of Mr. Casey, for 18 months in the case of Mr. Lynch, and for 12 months in the cases of Mr. Westenberger, Ms. Krugman, and Mr. Moore. In each case, base salary will be paid in bi-weekly installments. The Company is also obligated to pay each NEO a pro-rated annual cash incentive compensation amount that would have been earned by each such executive if he or she had been employed at the end of the year in which his or her employment was terminated. The determination of whether annual cash incentive compensation is payable to the NEO will not take into account any individual performance goals and shall be based solely on the extent to which Company performance goals have been met. Additionally, the Company is obligated to pay the Company’s contribution to the medical, dental, and life insurance benefits for 24 months in the case of Mr. Casey, for 18 months in the case of Mr. Lynch, and for 12 months in the case of Mr. Westenberger, Ms. Krugman, and Mr. Moore. The payment of severance is contingent on the NEO (a) executing an effective release of claims, and (b) complying with post-termination obligations including confidentiality, noncompetition, and non-solicitation covenants.

In the event that, within two years following a “change of control” (with “change of control” defined in each executive’s severance agreement) the Company terminates the NEO’s employment, other than for “cause” or such executive terminates his or her employment for “good reason,” the Company shall pay such NEO’s base salary, and the Company’s contribution to the medical, dental, and life insurance benefits, for 36 months in the case of Mr. Casey, 30 months in the case of Mr. Lynch, and 24 months in the case of Mr. Westenberger, Ms. Krugman, and Mr. Moore. In the event of a “change of control” of the Company, all unvested stock options and all unvested shares of restricted stock held by the NEO will fully vest.

Severance payments made to the NEOs are subject to the requirements of Section 409A of the Code.

Under the severance agreements with each of our NEOs, “cause” is generally deemed to exist when such NEO has: (a) been convicted of a felony or entered a plea of guilty or no contest to a felony; (b) committed fraud or other act involving dishonesty for personal gain which is materially injurious to the Company; (c) materially breached his obligations of confidentiality, intellectual property assignment, non-competition, non-solicitation, or non-disparagement against the Company after a cure period, provided such breach by its nature was curable; (d) willfully engaged in gross misconduct which is injurious to the Company; or (e) after a cure period, willfully refused to substantially perform his or her duties or is grossly negligent in performance of such duties.

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COMPENSATION DISCUSSION AND ANALYSIS

Under the agreements with our NEOs, “good reason” is generally deemed to exist when there is: (a) a material reduction in the executive’s title, duties, or responsibilities; (b) a material change in the geographic location at which the executive must perform services; or (c) a material breach of the executive’s agreement by the Company.

See “Potential Payments Upon Termination or Change of Control” below for a discussion and presentation of amounts our NEOs may be entitled to in the event of their termination, including following a change in control.

COMPENSATION AND HUMAN CAPITAL COMMITTEE REPORT

The Compensation and Human Capital Committee of the Board has reviewed and discussed with Company management the Compensation Discussion and Analysis included in this proxy statement. Based on such review and discussions, the Compensation and Human Capital Committee has recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement for filing with the SEC.

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FISCAL 2022 SUMMARY COMPENSATION TABLE*

The table below provides information concerning the compensation of our NEOs.

In the “Salary” column, we disclose the base salary paid to each of our NEOs during fiscal 2022, 2021, and 2020.

In the “Bonus” column, we disclose the discretionary bonus that was awarded based on Fiscal 2022 performance in light of the challenges faced by the Company due to inflation’s impact on customers, supply chain disruptions, and the COVID-19 pandemic.

In the “Stock Awards” column, we disclose the total fair value of the grants made in fiscal 2022, 2021, and 2020, without a reduction for assumed forfeitures, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. For restricted stock, the fair value is calculated using the closing price on the NYSE of our stock on the date of grant.

In the “Non-Equity Incentive Plan Compensation” column, we disclose the dollar value of all compensation earned in fiscal 2022, 2021, and 2020 pursuant to the Company’s Amended and Restated Incentive Compensation Plan, including all annual cash incentive compensation.

In the “All Other Compensation” column, we disclose the dollar value of all other compensation that could not properly be reported in other columns of the Fiscal 2022 Summary Compensation Table, including perquisites, amounts reimbursed for the payment of taxes, and other payments paid by the Company for the benefit of our NEOs.

FISCAL 2022 SUMMARY COMPENSATION TABLE

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FISCAL 2022 GRANTS OF PLAN-BASED AWARDS

The following table provides information concerning each grant of plan-based awards made to an NEO in fiscal 2022. This includes incentive compensation awards granted under our Incentive Compensation Plan and restricted stock awards granted under our Equity Incentive Plan. The threshold, target, and maximum columns reflect the range of estimated payouts under these plans for fiscal 2022. The last column reports the aggregate grant date fair value of all awards made in fiscal 2022 as if they were fully vested on the grant date, computed in accordance with FASB ASC Topic 718.