UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A​

Proxy Statement Pursuant to Section 14(a) of the
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NATIONAL VISION HOLDINGS, INC.

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National Vision Holdings, Inc.

2021 Proxy Statement
Notice of Annual Meeting of Stockholders

   

Tuesday, June 8, 2021

1:00 pm, Eastern Time​

                                 

                                                                              

                                                                                                   

 

TABLE OF CONTENTS

2021 Proxy Statement       i

 

This proxy statement includes links to websites, which are provided solely for convenience purposes. The information on these websites is not, and will not be deemed to be, a part of this proxy statement or incorporated into any other Company filings with the Securities and Exchange Commission (the “SEC”).

This proxy statement contains forward-looking statements. All statements, other than statements of historical facts included in this proxy statement, including statements concerning our plans, objectives, goals, beliefs, business strategies, future events, business conditions, results of operations, financial position, business outlook, business trends and other information, may be forward-looking statements. Words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “plans,” “estimates,” or “anticipates,” and variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not historical facts, or guarantees of future performance and are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. All forward-looking statements in this proxy statement, apply only as of the date of this proxy statement or as of the date they were made and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. There are a number of risks, uncertainties and other important factors, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking statements contained in this proxy statement. These risks and uncertainties include, but are not limited to, those described below in the “Risk Factors Summary,” in Part I. Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended January 2, 2021 (the “2020 10-K”) and those described from time to time in our future reports filed with the SEC.

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Dear Stockholders:

We are pleased to invite you to attend the National Vision Holdings, Inc. 2021 Annual Meeting of Stockholders on Tuesday, June 8, 2021, at 1:00 p.m., Eastern Time. Due to the continued concerns related to the coronavirus (COVID-19) pandemic, this year we will be holding a virtual Annual Meeting, as described further below.

Year In Review

2020 was a year like none other in our Company’s history—filled with uncertainty and unprecedented challenges on a global scale. National Vision has been resilient in difficult times, including economic crises, and we are proud of the actions we took in order to navigate the pandemic. Last March, as we realized the significance of COVID-19, we placed the highest priority on the health and safety of our associates, doctors, patients and customers as well as the local communities we operate in by temporarily closing our stores to the public in order to implement enhanced safety protocols. Our management team and our Board of Directors also acted swiftly to preserve cash, implement certain operational and cost-cutting initiatives, and proactively took steps to strengthen our liquidity position. Most importantly, our associates and doctors met every challenge that came their way in 2020 and we are grateful for their hard work and dedication. Despite the extraordinary circumstances in 2020, we delivered double-digit growth in the second half of the year, as well as an increase in our overall store count by 4.7%, ending the year with 1,205 stores. We believe 2020 was ultimately successful and we are well positioned to capitalize on future opportunities.

Our Commitment to Corporate Responsibility

We have a strong mission-focused culture where we believe everyone deserves to see their best to live their best. We are striving to build upon this culture and approach environmental, social and governance (ESG) topics, which we refer to as Corporate Responsibility, from a broad perspective. In 2020, we published our first Impact Report, focusing on our philanthropic efforts, and we began the process of developing a formal Corporate Responsibility strategy, including conducting a materiality assessment to identify our priority areas of focus, along with gaps and opportunities for us to address. We are continuing our efforts by defining our internal Corporate Responsibility governance structure, including Board and executive officer oversight, and creating our strategic framework to manage our Corporate Responsibility efforts and reporting metrics. We look forward to reporting our continued progress on our website’s newly launched Corporate Responsibility page.

Corporate Responsibility includes our commitment to responsible corporate governance. Our Board of Directors is comprised of a group of industry-leading experts with diverse genders, ethnicities, experiences and backgrounds, who oversee the Company’s strategy and drive long-term value for our stockholders. A majority of our eight independent directors identify as diverse, with four women and two directors of racial/ethnic diversity. We are proud that our Board reflects the diversity of our associates and customers in that way.

Looking Ahead

As we move into 2021, the safety and health of our associates, doctors, patients, and customers remains our highest priority as we continue to navigate the pandemic and provide reliable and quality low cost eye care and eyewear to our patients and customers. Despite the uncertainty created by the pandemic and the related volatility in the global economy, we remain focused on delivering value for you, our stockholders, over the long term.

Our 2021 Annual Meeting:

Whether you own a few shares or many, and whether or not you plan to attend the virtual Annual Meeting, your vote is important to us. We encourage you to review the proxy materials and submit your vote today. While this year’s meeting will be virtual, all stockholders will be afforded the same rights they would have had at a physical meeting. Detailed information concerning the Annual Meeting is set forth in the Notice of Annual Meeting of Stockholders, Notice of Internet Availability of Proxy Materials and proxy statement, which describe the business to be conducted at the meeting. Whether or not you plan to attend, it is important that your shares be represented and voted during the meeting. Instructions for voting your shares are set forth in the proxy statement as well as in the Notice of Internet

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Availability of Proxy Materials you received in the mail. The Notice of Internet Availability of Proxy Materials, the proxy statement, and the enclosed proxy card and annual report are first being sent to stockholders on or about April 30, 2021.

On behalf of the Board of Directors and everyone at National Vision, we are grateful for your continued support. Thank you for being a stockholder of National Vision Holdings, Inc.

Sincerely,

April 30, 2021

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

By Order of the Board of Directors,

Jared Brandman
Senior Vice President, General Counsel and Secretary

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PROXY STATEMENT SUMMARY

We are providing this proxy statement to you in connection with the solicitation of proxies by the Board of Directors (the “Board of Directors” or the “Board”) of National Vision Holdings, Inc. (the “Company”) for the 2021 Annual Meeting of Stockholders (the “Annual Meeting”) and for any adjournment or postponement of the Annual Meeting. This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all the information you should consider, and you should read the entire proxy statement carefully before voting.

2021 ANNUAL MEETING OF STOCKHOLDERS

AGENDA AND VOTING RECOMMENDATIONS

HOW TO VOTE

If at the close of business on April 15, 2021, you were a stockholder of record or held shares through a broker or bank, you may vote your shares by proxy at the Annual Meeting. You may vote your shares over the Internet, by telephone or by mail, or you may vote online during the Annual Meeting. See full instructions under the Important Information About Voting at the Annual Meeting section of this proxy statement on page 56.

If you are a stockholder of record and you would like to vote in any manner other than online during the virtual Annual Meeting, your vote must be received by 11:59 p.m., Eastern Time, on June 7, 2021 to be counted. If you hold shares through a broker, bank or other nominee, please refer to information from your bank, broker or nominee for voting instructions.

2020 BUSINESS HIGHLIGHTS

COVID-19 Response

2020 was a challenging year with the outbreak of the COVID-19 global pandemic and the resulting impact on economic activity and businesses. Even with a year of unprecedented business challenges, we are proud of how we have navigated and continue to navigate through the pandemic. With a safety-first approach in mind, our Board and management team took certain financial and operational actions, as outlined below, to prudently manage the business while positioning the Company to be able to safely continue to provide low cost eye care and eyewear, a medical necessity, to our patients and customers.

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Financial Highlights

Despite the extraordinary circumstances of this year, we believe fiscal 2020 was ultimately successful and believe we are well positioned to capitalize on future opportunities for the Company. In fiscal 2020, our financial and operational highlights included:

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Net income increased 10.6% to $36.3 million

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Adjusted EBITDA1 increased 12.4% to $218.3 million

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Adjusted Operating Income1 increased 17.4% to $134.1 million

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Overall store count grew 4.7%, and fiscal 2020 ended with 1,205 stores

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Total comparable store sales growth for the seven months ended January 2, 2021 (after we began gradually re-opening stores to the public) was 13.1% and Adjusted Comparable Store Sales Growth1 for the seven months ended January 2, 2021 was 12.6%

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Record operating cash flows increased from $165.1 million in 2019 to $235.0 million in 2020

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Diluted EPS increased 9.1% to $0.44; Adjusted Diluted EPS1 increased 21.9% to $0.91

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Our cash balance was $373.9 million as of January 2, 2021

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(1) For an explanation of our non-GAAP financial measures and a reconciliation of Adjusted EBTDA, Adjusted Operating Income, Adjusted Comparable Store Sales Growth and Adjusted Diluted EPS to the most directly comparable GAAP measures, see Appendix A to this proxy statement.

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CORPORATE GOVERNANCE AND BOARD HIGHLIGHTS

Set forth below is a snapshot of our current National Vision Board, their independence, diversity and skills/​qualifications. See Proposal 1 beginning on page 11 for more details on the election of our Class I directors.

CURRENT NATIONAL VISION BOARD

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All directors are independent, except for Mr. Fahs

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Mr. Peeler serves as the independent Chair of the Board

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PHILANTHROPY & CORPORATE RESPONSIBILITY; HUMAN CAPITAL MANAGEMENT

In August 2020, we published our first-ever philanthropic Impact Report detailing how the Company is transforming the lives of people in the United States and around the world. Our Impact Report focused on the Company’s impact through 2019 in the core areas of (1) helping children in need in the United States, (2) global giving and (3) partnering to make an impact, and also highlighted the Company’s commitment to providing help during the pandemic.

In addition to our ongoing philanthropic efforts, we are focused on a commitment to balancing the social, economic, human capital management and environmental aspects of our business and to developing additional disclosure to highlight our aspirations and achievements in these areas. In 2020, we began our formal Corporate Responsibility journey and completed a materiality assessment on the core pillars at the heart of our operations and goals.

With an inclusive and people-first culture, we are focused on celebrating and respecting our associates’ diverse backgrounds, empowering, rewarding and developing our associates and aiming to give back to the communities in which we serve. Our human capital initiatives are focused on attracting highly qualified individuals and providing them with continued opportunities for growth and development.

See Philanthropy and Corporate Responsibility and Human Capital Management on pages 20 and 21 for more details.

PROPOSAL TO AMEND OUR CERTIFICATE OF INCORPORATION TO ELIMINATE THE CLASSIFIED STRUCTURE OF THE BOARD OF DIRECTORS

Our Second Amended and Restated Certificate of Incorporation (the “certificate of incorporation”) currently provides for a classified Board of Directors divided into three classes, with approximately one-third of our directors standing for

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election each year. At last year’s annual meeting, the Board announced its commitment to submit for stockholder vote at the 2021 annual meeting a management proposal to amend our certificate of incorporation to eliminate the classified structure of the Board. After careful consideration, the Board has approved amendments to the certificate of incorporation to phase out the three-year staggered terms of our directors and transition to the annual election of all of our directors, subject to approval by stockholders. If the proposed amendments to the certificate of incorporation are approved by the stockholders, beginning at the Company’s 2022 annual meeting, directors standing for election will be elected to one-year terms. By the 2024 annual meeting, the Board will be completely declassified and all directors will stand for election annually. See Proposal 2 beginning on page 24.

PROPOSAL TO AMEND OUR CERTIFCATE OF INCORPORATION TO ELIMINATE SUPERMAJORITY VOTING STANDARDS AND OTHER OBSOLETE PROVISIONS

Our certificate of incorporation currently provides for supermajority voting standards for (1) any amendment to our certificate of incorporation related to: amendments to the certificate of incorporation or bylaws, the removal of directors, director liability, the ability for stockholders to act by written consent, completion and corporate opportunities and business combinations, (2) any amendment to our bylaws, (3) the removal of directors, and (4) certain business combinations with interested stockholders. At last year’s annual meeting, the Board set forth its commitment to submit for stockholder vote at the 2021 annual meeting a management proposal to amend our certificate of incorporation to eliminate these supermajority voting standards. Our certificate of incorporation also includes certain obsolete provisions relating to the prior equity ownership of our former equity sponsors. After careful consideration, the Board has approved amendments to the certificate of incorporation to eliminate these supermajority voting standards and obsolete provisions, subject to approval by stockholders. If the proposed amendments to the certificate of incorporation are approved by the stockholders, these supermajority voting provisions and obsolete provisions would be eliminated immediately upon filing of an amendment to the certificate of incorporation (which the Company intends to do promptly following the Annual Meeting). See Proposal 3 beginning on page 26.

EXECUTIVE COMPENSATION HIGHLIGHTS

We strive to create an executive compensation program that strikes the right balance of pay for performance with an overarching goal to motivate our leaders to contribute to the achievement of our financial goals and focus on long-term value for our stockholders without taking undue risk. Our executive compensation program has three main components: (1) base salary; (2) annual cash incentive compensation; and (3) long-term incentive awards. Each component is designed to be consistent with the Company’s compensation philosophy.

The compensation and governance practices that support these principles include the following:

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The discussion on pages 30–40 more fully describes the design and evolution of our executive compensation program, including the Company’s performance for fiscal 2020 and its connection to executive officer compensation as well as certain changes to the Company’s metrics for fiscal 2021. See Proposal 4 beginning on page 29.

RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The audit committee of the Board has selected Deloitte & Touche LLP as our independent registered public accounting firm for fiscal 2021. Each year the audit committee evaluates the qualifications and performance of the Company’s independent registered public accountants and determines whether to re-engage the current independent registered public accountants. Based on this evaluation, the audit committee believes the continued retention of Deloitte & Touche LLP is in the best interests of the Company and its stockholders. See Proposal 5 beginning on page 54.

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PROXY STATEMENT

PROPOSAL NO. 1—ELECTION OF DIRECTORS

Our Board of Directors oversees or directs our business and affairs, as provided by Delaware law, and conducts its business through meetings of the Board and three standing committees: the audit committee, the nominating and corporate governance committee and the compensation committee. The Board is currently comprised of nine directors, eight of whom are independent.

Our certificate of incorporation currently provides for a classified Board, with three directors currently in Class I (Mr. Fahs, Ms. Johnson and Ms. Kelman), three directors currently in Class II (Messrs. Armario and Peeler and Ms. Cianfrocco), and three directors currently in Class III (Messrs. Tehle and Taylor and Ms. Hepner). One class of directors stands for election at each of our annual meetings of stockholders, with directors elected to serve for staggered three-year terms. Upon the recommendation of our nominating and corporate governance committee, our Board is submitting for stockholder vote at the Annual Meeting a management proposal to amend our certificate of incorporation to eliminate the classified structure of the Board. See Proposal 2 below for more details.

The terms of our three current Class I directors expire on the date of the Annual Meeting, subject to the election and qualification of their successors. Upon the recommendation of the nominating and corporate governance committee, the Board has nominated L. Reade Fahs, Susan S. Johnson and Naomi Kelman for election as Class I directors for a three-year term expiring in 2024.

Unless otherwise instructed, the persons named in the form of proxy card (the “proxyholders”) included with this proxy statement intend to vote the proxies held by them “FOR” the election of L. Reade Fahs, Susan S. Johnson and Naomi Kelman. We have no reason to believe that Mr. Fahs, Ms. Johnson and Ms. Kelman will be unable or unwilling to serve if elected. If Mr. Fahs, Ms. Johnson and Ms. Kelman cease to be candidates for election by the time of the Annual Meeting (a contingency which the Board does not expect to occur), such proxies may be voted by the proxyholders in accordance with the recommendation of the Board.

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Nominees for Election to the Board of Directors

Set forth below is certain information regarding each director nominee. Beneficial ownership of equity securities of each director nominee is shown under “Ownership of Our Securities” later in this proxy statement.

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Continuing Members of the Board of Directors

Set forth below is certain information regarding each director whose term continues beyond the Annual Meeting and who is not subject to election this year. Beneficial ownership of equity securities for these directors is also shown under “Ownership of Our Securities” later in this proxy statement.

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Board Oversight

The primary responsibility of our Board is to oversee the affairs of the Company for the benefit of our stockholders and other stakeholders. As part of its responsibility, the Board oversees critical matters such as strategy, management succession planning, financial and other internal controls, corporate governance, risk management and compliance. To assist it in fulfilling its duties, our Board has delegated certain authority to its standing committees—the audit committee, the nominating and corporate governance committee and the compensation committee. The duties and responsibilities of these standing committees are described below under “Board Committees and Meetings.”

Director Independence

We believe the Company benefits from having a strong and independent Board. Under our Corporate Governance Guidelines and the Nasdaq Listing Rules, a director is not independent unless the Board affirmatively determines that he or she does not have a relationship with management that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

Our Corporate Governance Guidelines define independence in accordance with the independence standards in the current Nasdaq Listing Rules. Our Corporate Governance Guidelines require the Board to review the independence of all directors at least annually.

Our Board has affirmatively determined that all of the directors and nominees for director, except Mr. Fahs, are independent under the guidelines for director independence set forth in the Corporate Governance Guidelines and under all applicable Nasdaq guidelines. Mr. Fahs is not considered an independent director because of his employment as Chief Executive Officer of the Company. All members of the audit committee, compensation committee and nominating and corporate governance committee are independent.

In making its independence determinations, the Board considered and reviewed all information known to it, including information identified through annual directors’ questionnaires.

Composition of the Board of Directors

At the Annual Meeting, we are submitting a management proposal for approval to eliminate the classified structure of the Board and allow for the annual election of our directors. If approved, we would amend our certificate of incorporation to eliminate the three classes of directors and provide for the annual election of directors beginning at the 2022 annual meeting of stockholders. By the 2024 annual meeting of stockholders, the Board would be completely declassified and all directors would stand for election annually. See “Proposal 2—Amendment to the Certificate of Incorporation to Eliminate the Classified Structure of the Board of Directors” below for more details on the elimination the classified Board structure.

Prior to the effectiveness of the proposal described above, at each annual meeting, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following their election. Our certificate of incorporation provides that the authorized number of directors may be changed only by resolution of our Board of Directors. Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. The division of our Board of Directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change in control of our Company.

Director Nomination Process

The nominating and corporate governance committee weighs the characteristics, experience, independence and skills of potential candidates for election to the Board and recommends nominees for director to the Board for election by our stockholders in accordance with our Corporate Governance Guidelines. As the application of these factors involves the exercise of judgment, the nominating and corporate governance committee does not have a standard set of fixed qualifications that is applicable to all director candidates, although the nominating and corporate governance committee does at a minimum assess each candidate’s integrity, accountability, skills, experience, independence, other outside commitments and ability to work collegially with the other members of the Board of Directors.

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Diversity, Qualifications, Skills and Experiences of our Directors

In addition, although the Board considers and fully appreciates the value of a diversity of viewpoints, background and experiences (including age, race and ethnicity) as important to the selection of directors to enhance the Board’s cognitive diversity and quality of dialogue in the Boardroom, the Board does not have a formal diversity policy.

The nominating and corporate governance committee believes that the current members of the Board provide a demonstrated executive leadership ability and are representative of diverse backgrounds.

When considering whether directors and nominees have the experience, qualifications, attributes or skills, taken as a whole, to enable our Board of Directors to satisfy its oversight responsibilities effectively in light of our business and structure and address areas where additional expertise or skills may be needed, the Board of Directors focused primarily on each person’s background and experience as reflected in the information discussed in each of the directors’ individual biographies set forth above. We believe that our directors provide an appropriate mix of experience and skills relevant to the size and nature of our business. In particular, the members of our Board of Directors considered the following important characteristics, among others, as key qualifications, attributes or skills to provide Board oversight of the Company’s business operations and strategy.

The nominating and corporate governance committee may identify candidates for election to the Board of Directors on its own, or by considering recommendations from stockholders, officers and employees of the Company and other sources that the nominating and corporate governance committee deems appropriate. The nominating and corporate governance committee may also retain a third-party search firm to assist in the identification of possible candidates for election to the Board of Directors. The nominating and corporate governance committee will consider director candidates recommended by stockholders on the same basis as recommendations from other sources. Any recommendation submitted to the Secretary of the Company should be in writing and should include any supporting material the

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stockholder considers appropriate in support of that recommendation, but must include information that would be required under the rules of the SEC to be included in a proxy statement soliciting proxies for the election of such candidate and a written consent of the candidate to serve as one of our directors if elected. Stockholders also must satisfy the notification, timeliness, consent and information requirements set forth in our bylaws. Stockholders wishing to propose a candidate for consideration may do so by submitting the required information to the attention of the Secretary, National Vision Holdings, Inc., 2435 Commerce Ave, Building 2200, Duluth, Georgia 30096. All recommendations for nomination received by the Secretary that satisfy our bylaw requirements relating to director nominations will be presented to the nominating and corporate governance committee for its consideration. These requirements are also described under “Stockholder Proposals for the 2022 Annual Meeting.”

Leadership Structure of the Board of Directors

As described in our Corporate Governance Guidelines, our Board directs and oversees the management of the business and the affairs of the Company using its business judgment to act in the best interests of the Company and its stockholders. As part of this oversight role, the Board selects and oversees the members of senior management who are charged by the Board with conducting the business of the Company. While our Corporate Governance Guidelines provide our Board with flexibility to combine or separate the positions of Chairman of the Board and Chief Executive Officer in accordance with its determination that utilizing one or the other structure would be in the best interests of our Company, our Board currently believes that having these positions separated, with Mr. Peeler serving as Chairman of the Board and Mr. Fahs serving as our Chief Executive Officer and also as a director, is the appropriate leadership structure at this time and demonstrates our commitment to good corporate governance. However, our Board of Directors will continue to periodically review our leadership structure and may make such changes in the future as it deems appropriate. Under our Corporate Governance Guidelines, should the Board determine that such positions should not be separated and the Chairperson of the Board is also the Chief Executive Officer or a director who does not qualify as an independent director, the independent directors may annually elect from among themselves a lead independent director.

Board Oversight of Risk Management

Management is responsible for the day-to-day management of risk, while the Board, as a whole and through its committees has extensive involvement in the oversight of the Company’s risk management. The Board engages in risk oversight throughout the year as a matter of course in fulfilling its role overseeing management and business operations, including receiving reports from management on the strategic plans and related risks facing the Company which range from financial risks to regulatory, legal, supply chain, COVID-19 pandemic-related, sustainability, competitive and information technology risks. The Board has delegated to its committees certain elements of its risk oversight function to better coordinate with management and serve the long-term interests of our stockholders. We believe that the leadership structure of our Board of Directors, along with the allocation of risk management responsibilities described below by appropriate committee oversight, provides appropriate risk oversight of our activities.

The audit committee oversees our risk management process with a specific focus on internal controls, financial statement integrity, compliance programs, fraud risk, legal matters and related risk mitigation. Along with the Board, the audit committee also receives regular reports from management to help ensure effective and efficient oversight and to assist in proper risk management, including with respect to cybersecurity, and the ongoing evaluation of management controls. Through its regular meetings with management, including the finance, legal, internal audit, and compliance functions and discussions, as appropriate, with our independent registered public accounting firm and internal auditors, the audit committee reviews and discusses significant areas of our business, including areas of risk and appropriate mitigating factors. Internal audit reports functionally and administratively to our Chief Accounting Officer and directly to the audit committee.

The compensation committee reviews the risk profile of the Company’s compensation policies and practices, including a review of a risk assessment of our compensation programs and managing risk associated with human capital management, including employee recruitment and retention.

The nominating and corporate governance committee monitors risks relating to governance matters, including corporate responsibility and sustainability, and recommends appropriate actions in response to those risks.

Management Succession Planning

The Board believes that one of its primary responsibilities is to oversee the development and retention of senior talent and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other members of

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senior management. The Board and compensation committee, together with the Chief Executive Officer, regularly reviews senior management talent and succession planning.

Executive Sessions

Executive sessions, which are meetings of the independent directors of the Board, are regularly scheduled throughout the year, typically at the time of each regular Board meeting and as frequently as such independent directors deem appropriate.

Board and Committee Evaluations

In order to increase the effectiveness of the Board, the nominating and corporate governance committee supervises an annual review and evaluation of the performance of the Board and its committees. The evaluation is typically conducted through a range of questions related to topics including structure of the Board and its committees, overall Board and committee effectiveness, oversight and risk management, strategy and Board access to information and resources. In 2020, an evaluation was conducted and completed with each director providing direct feedback. The evaluation results about the Board and its committees were reviewed and discussed by the nominating and corporate governance committee as well as the full Board.

Communications with the Board

As described in our Corporate Governance Guidelines, stockholders and other interested parties who wish to communicate with a member or members of our Board of Directors, including the chairperson of our Board of Directors, the chairperson of any of the audit, compensation and nominating and corporate governance committees, or to the non-management or independent directors as a group, may do so by addressing such communications or concerns to the Secretary of the Company, 2435 Commerce Ave, Building 2200, Duluth, GA 30096, who will forward such communication to the appropriate party.

Board Committees and Meetings

Our Board of Directors has an audit committee, a nominating and corporate governance committee and a compensation committee, each of which operates under a charter that has been approved by our Board.

The following table summarizes the current membership of each of the Board’s committees.

All directors are expected to make every effort to attend all meetings of the Board of Directors, meetings of the committees of which they are members and the annual meeting of stockholders. Each of our directors that were members of our Board at the time attended the 2020 annual meeting. During the fiscal year ended January 2, 2021, the Board held fourteen meetings, the audit committee held eight meetings, the compensation committee held four meetings and the nominating and corporate governance committee held four meetings. In addition, the Board, the audit committee, the compensation committee and the nominating and corporate governance committee acted by unanimous written consent several times during fiscal 2020. Each of our directors attended at least 75% of all of the meetings of the Board and committees on which he or she served at they time they served on the Board or such

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committees, except for Ms. Johnson. Ms. Johnson attended 50% of the audit committee meetings as she was unable to attend one audit committee meeting in 2020 after joining the Board due to a pre-existing conflict for one meeting date prior to her joining the Board.

Audit Committee

Our audit committee consists of David M. Tehle, who serves as the Chair, Virginia A. Hepner, Susan S. Johnson and Naomi Kelman. Mr. Tehle and Mses. Hepner, Johnson and Kelman each qualifies as an independent director under Nasdaq corporate governance standards and the independence requirements of Rule 10A-3 of the Securities Exchange Act of 1934 (the “Exchange Act”). Our Board of Directors has determined that Mr. Tehle and Ms. Hepner each qualifies as an “audit committee financial expert” as such term is defined in Item 407(d)(5) of Regulation S-K.

The audit committee is responsible for, among other things, preparing the audit committee report required by the SEC to be included in our proxy statement and assisting our Board of Directors with respect to its oversight of (1) our risk management policies and procedures, (2) the audits and integrity of our financial statements, and the effectiveness of internal control over financial reporting, (3) our compliance with legal and regulatory requirements, including SEC filings, (4) the qualifications, engagement, performance and independence of the outside auditors, including approving all auditing and non-auditing services performed by our outside auditors and (5) approving the annual audit plans and the performance of our internal audit function.

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee consists of Virginia Hepner, who serves as the Chair, D. Randolph Peeler and Jose Armario. Each member of the nominating and corporate governance committee has been determined to be independent under the applicable listing standards of Nasdaq and our Corporate Governance Guidelines.

The primary purpose of the nominating and corporate governance committee is to provide assistance to the Board of Directors by, among other things, determining the size, structure, composition, processes and practices of the Board and its committees and assessing director independence and qualifications. The committee also identifies, recommends and assists the Board in recruiting individuals qualified to become Board members, and takes a leadership role in shaping the corporate governance of the Company through its review and development of our Corporate Governance Guidelines and practices and guidance of the annual Board evaluation. The committee, along with the Board as whole, retains oversight responsibility for the Company’s Corporate Responsibility strategy and provides oversight and guidance on environmental sustainability, social justice and corporate responsibility issues and opportunities for the Company.

Compensation Committee

Our compensation committee consists of Thomas Taylor, Jr., who serves as the Chair, D. Randolph Peeler and Heather Cianfrocco. Each member of the compensation committee has been determined to be independent under the applicable listing standards of Nasdaq and our Corporate Governance Guidelines.

The primary purpose of the compensation committee is to assist our Board of Directors in discharging its responsibilities relating to (1) setting our compensation philosophy and compensation of our executive officers and directors, (2) monitoring our equity-based and certain incentive compensation plans and (3) preparing the compensation committee report required to be included in our proxy statement or annual report under the rules and regulations of the SEC.

Committee Charters and Corporate Governance Guidelines

Our commitment to good corporate governance is reflected in our Corporate Governance Guidelines, which describe our Board of Directors’ views and policies on a wide range of governance topics. These Corporate Governance Guidelines are reviewed from time to time by our Board of Directors and, to the extent deemed appropriate in light of emerging practices, revised accordingly, upon recommendation to and approval by our Board of Directors.

Our Corporate Governance Guidelines, audit, nominating and corporate governance and compensation committee charters, and other corporate governance information are available in the investors section of our website, www.nationalvision.com.

Code of Conduct

We are committed to ensuring our business is conducted ethically and legally. We maintain a written code of conduct that applies to our directors, officers and employees, including our principal executive officer, principal financial officer,

2021 Proxy Statement       19

principal accounting officer, or persons performing similar functions, which we call our Code of Conduct. Our Code of Conduct is a “code of ethics” as defined in Item 406(b) of Regulation S-K and is posted in the investors section of our website, www.nationalvision.com.

We intend to make any legally required disclosures regarding amendments to, or waivers of, provisions of our Code of Conduct on our website.

Hedging and Pledging Policies

The Company’s Securities Trading Policy requires executive officers and directors to consult the Company’s General Counsel prior to engaging in transactions involving the Company’s securities. Directors and executive officers are prohibited from hedging or monetization transactions including, but not limited to, variable forward contracts, equity swaps, collars and exchange funds, or from trading in options, warrants, puts and calls or similar instruments on the Company’s securities or establishing a short position in the Company’s securities. The Company’s Securities Trading Policy discourages employees from purchasing the Company’s securities on margin, or borrowing against any account in which the Company’s securities are held, or pledging the Company’s securities as collateral for a loan. For directors and officers, the pledging of Company securities is limited to those situations approved by the Company’s General Counsel.

Transactions with Related Persons

The Board has adopted a written related person transaction policy that sets forth the policies and procedures for the review and approval or ratification of related person transactions. This policy covers, with certain exceptions set forth in Item 404 of Regulation S-K under the Securities Act, any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships, in which we were or are to be a participant, where the amount involved exceeds $120,000 and a related person had or will have a direct or indirect material interest, including, without limitation, purchases of goods or services by or from the related person or entities in which the related person has a material interest, indebtedness, guarantees of indebtedness and employment by us of a related person. It is our policy that no related person transaction will be executed without the approval or ratification of the disinterested members of the Board or a committee of the Board.

Certain Related Person Transactions

Management Stockholder’s Agreements. In connection with the acquisition of NVI in March 2014 by affiliates of KKR & Co. Inc (“KKR”) and thereafter, we entered into Management Stockholder’s Agreements with certain of our senior executive officers and other employees who made an equity investment in us or were granted equity-based awards. The Management Stockholder’s Agreements provide for management stockholders’ ability to cause us to repurchase their outstanding stock and options in the event of their death or disability, and for our ability to cause a management stockholder to sell his or her stock or options back to the Company upon certain termination events.

Stockholder Engagement

In connection with and following our initial public offering (IPO), we have been committed to stockholder engagement and we greatly value the input we receive from our stockholders. Our investor relations team and members of our senior management are in frequent communication with stockholders on a variety of matters, primarily focused on our operations and financial performance. In 2020, we continued our stockholder engagement program focused on corporate governance, executive compensation, corporate social responsibility and other ESG matters of interest to our stockholders. As part of our engagement efforts, we conducted stockholder outreach with the Company’s top institutional investors representing approximately 63% of our shares outstanding. Many of these stockholders expressed the view that they were aligned with the Company’s board refreshment and continued Board diversity efforts, the continued progress and evolution and disclosure of the Company’s philanthropic as well as other environmental, social and governance priorities, and supported the Company’s executive compensation program.

Philanthropy and Corporate Responsibility

We strive to align our actions with our Company vision—“We believe everyone deserves to see their best to live their best.” The need for eye care and eyewear is a critical national and global issue. We focus our philanthropic efforts in the optical sector, where we feel we can make the greatest difference. We are proud to be working with organizations

20       2021 Proxy Statement

and individuals, both domestically and around the world, to provide solutions so more people can get the care they need. In August 2020, we published our first-ever philanthropic Impact Report detailing how the Company is transforming the lives of people in the United States and around the world. Our Impact Report focused on the Company’s impact through 2019 in the core areas of (1) helping children in need in the United States, (2) global giving and (3) partnering to make an impact, and also highlighted the Company’s commitment to providing help during the pandemic. Through partnering with schools and the Boys & Girls Club of America, we have provided more than 18,000 free eye exams and distributed more than 10,000 pairs of glasses. Through our partnership with RestoringVision, a global vision nonprofit, we have coordinated the donation and distribution of more than 500,000 glasses over the past 13 years and contributed more than $340,000.

In addition to our philanthropic efforts, we understand the importance of acting responsibly as a business, employer and corporate citizen. Engagement on corporate responsibility is important to us and our stakeholders. We are focused on a commitment to balancing the social, economic, human capital management and environmental aspects of our business and to developing additional disclosure to highlight our aspirations and achievements in these areas. In 2020, we began our formal Corporate Responsibility journey and completed a materiality assessment on the core pillars at the heart of our operations and goals. Informed by insights from our assessment, we are developing our goals and reporting metrics as an important part of our ongoing commitment to transparency and impact. Our approach, once complete, will enable the Company to provide an integrated, comprehensive view of its corporate responsibility commitments, progress and impact. More information about Corporate Responsibility at National Vision can found in the Corporate Responsibility page of our website, www.nationalvision.com. The information on this website is not, and will not be deemed to be, a part of this proxy statement or incorporated into any other filings with the SEC.

Human Capital Management

With an inclusive and people-first culture, we are focused on celebrating and respecting our associates’ diverse backgrounds, empowering, rewarding and developing our associates and aiming to give back to the communities in which we serve. Our human capital initiatives are focused on attracting highly qualified individuals and providing them with continued opportunities for growth and development. As of January 2, 2021, we had 12,792 full-time and part-time associates. In addition, the professional corporations or similar entities with which we contract employed 1,200 optometrists as of January 2, 2021.

Talent Acquisition

At National Vision, we are committed to attracting talent aligned with our Vision, Mission and Values. We have invested in key leadership roles within the talent organization to refine our approach and have incorporated new technology to improve both the candidate and hiring manager experience. In addition, we have partnered with schools and other organizations to promote the profession of optometry, including continuing our multi-year sponsorship of the Association of Schools and Colleges campaign “Optometry Gives Me Life” targeted at high school and college students. To mitigate the impact the COVID-19 pandemic and temporary closure of our stores had on our traditional recruiting efforts and hiring cycles, we transitioned to online platforms for job fairs and on campus events, selectively offered key incentives, such as a student loan repayment program, and educated applicants on the health and safety protocols implemented in our stores.

Talent Development

We have a proven record of opening new stores with high-quality training support. As a result of the COVID-19 pandemic, we adapted our new store training approach by introducing and enhancing virtual instructor-led training classes, allowing for a continuation of high touch training to prepare stores to open safely and effectively. We also increased ongoing training, especially in the areas of safety protocol procedures and customer interactions. We provide our associates and optometrists with several opportunities and mechanisms through which they can provide feedback and allow us to continue developing programs for training and growth.

Benefits and Wellness

We strive to ensure our people always feel supported so they can bring their best selves to work every day. We demonstrate this commitment through many of our benefits and wellness offerings. Programs like our health plan, wellness and disease management programs, including personalized programs for diabetes and hypertension, and a financial protection resource, provide the needed resources essential for helping our people care for themselves and their families.

We also offer free on-demand mental and behavioral health resources, to provide needed guidance when work and personal challenges affect an associate’s overall well-being. Shortly after our IPO, we established the National Vision

2021 Proxy Statement       21

Crisis Relief Fund to help support associates who are facing financial hardship as a result of a natural disaster, family emergency or other unexpected events. Donations made to the Crisis Relief Fund are matched by the Company. Since its creation, over $800,000 have been provided to associates for assistance, with over 90% provided since the beginning of the COVID-19 pandemic.

Diversity, Equity and Inclusion

We are committed to a diverse and inclusive culture and proud to be a “majority-minority company.” In 2020, we formed a new Diversity, Equity and Inclusion (“DEI”) department within the Company led by a veteran senior executive. The DEI department is supported by our DEI Council, composed of a cross-section of associates and optometrists. In 2020, we focused on reviewing best practices and initiatives and conducted listen and learn sessions with associates and optometrists to solicit feedback and identify opportunity areas. As we move forward in our DEI journey, we are focused on advancing diversity in our recruitment, training, career mentorship and development, employment branding and community service. As a part of these efforts, in 2020, we collaborated with non-profit and educational institutions with the goal of increasing the percentage of Black doctors in the industry, including sponsoring and participating in the first ever “Impact HBCU” event sponsored by Black Eyecare Perspectives with the goal of increasing awareness in the field among HBCU students.

COVID-19 Response

As noted earlier in this proxy statement, the COVID-19 pandemic has presented unique challenges for our associates, doctors, patients and customers. We prioritized the safety of our associates, doctors, patients and customers by voluntarily closing our stores to the public for a temporary period of time in 2020 to implement enhanced safety and cleaning protocols in order to serve our patients and customers with everyone’s health and safety in mind.

We also created multiple resources for associates, including frequent and transparent communication tools, additional leave of absence and paid leave options, and centralized support to address COVID-19 questions and concerns, including regarding the availability of vaccines. We paid one-time appreciation bonuses to customer-facing associates in the third quarter of fiscal year 2020, granted additional company holidays in the fourth quarter of fiscal year 2020 and paid benefits for associates furloughed in response to the COVID-19 pandemic. In addition, contributions to our Crisis Relief Fund more than doubled, reflecting the empathetic nature of our community.

Compensation of Directors

Directors who are our employees do not receive remuneration for serving on our Board. In 2020, our director compensation program consisted of the following:

•

Annual cash retainer of $75,000, paid quarterly, in arrears.

​

•

The Chair of the audit committee, compensation committee and nominating and corporate governance committee received annual cash retainers of $20,000, $15,000 and $10,000, respectively, paid quarterly, in arrears.

​

•

Annual $100,000 restricted stock grant, which will vest on the first anniversary of the grant date, subject to continued service through the applicable vesting date.

​

Our directors are not paid any fees for attending meetings. However, our directors are reimbursed for reasonable travel and related expenses associated with attendance at Board or committee meetings.

The compensation committee, with assistance from its independent compensation consultant, reviews the director compensation program regularly to ensure the program is structured consistent with best practices and current trends. As part of this review, the director compensation program is benchmarked against the same compensation peer group used for executive compensation benchmarking, as described later in the Compensation Discussion & Analysis section. The compensation committee last reviewed director compensation in December 2018 and made appropriate changes based upon the results at that time.

In March 2020, in light of the unprecedented impact of the pandemic, the Board elected to forego their annual cash compensation for the second quarter of 2020.

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The following table reflects all cash compensation paid and the aggregate market value of stock awards granted to our non-employee directors for service in fiscal 2020:

​

(1)

Includes all annual retainer fees paid in cash to the directors, including the voluntary election by the Board to forego their cash compensation for the second quarter of 2020 in response to the pandemic. In lieu of receiving cash retainers, Messrs. N. Taylor and Peeler donated their cash retainers to 20/20 Quest, a National Vision sponsored charitable foundation. Ms. Cianfrocco donated $28,125 of her cash retainer to 20/20 Quest.

​

(2)

The amount reported reflects the grant date fair value calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation (“ASC Topic 718”) associated with the grant to each director as of such grant date. See Note 5 of the Notes to Consolidated Financial Statements contained in the Company’s 2020 Form 10-K for an explanation of the assumptions made in the valuation of these awards. The grant date fair value of the annual award that was granted on June 11, 2020 for all directors (other than Ms. Johnson and Ms. Kelman) was $100,000 for the 3,632 shares of restricted stock granted to such directors. The grant date fair value of the 2,687 shares of restricted stock granted to Ms. Kelman in September 2020 was $100,000. The grant date fair value of the 2,368 shares of restricted stock granted to Ms. Johnson in October 2020 was $100,000. As of January 2, 2021, Ms. Cianfrocco held 3,632 shares of unvested restricted stock, Ms. Hepner held 4,420 shares of unvested restricted stock, Ms. Johnson held 2,368 shares of unvested restricted stock, Ms. Kelman held 2,687 shares of unvested restricted stock, Mr. T. Taylor held 4,365 shares of unvested restricted stock and Mr. Tehle held 4,510 shares of unvested restricted stock.

​

(3)

At the request of Mr. Peeler, the compensation committee approved in June 2019 a program in which (i) in lieu of paying his cash retainer for Board service and any committee chairperson service directly to Mr. Peeler, the Company would instead make a quarterly donation of such retainer in Mr. Peeler’s name to the Company’s foundation or another charity of his choosing and (ii) Mr. Peeler would not receive the restricted stock award to which non-employee directors are entitled under the director compensation program.

​

(4)

Mr. N. Taylor retired from the Board in September 2020. At the request of Mr. N. Taylor, the compensation committee approved in September 2019 a program in which (i) in lieu of paying his cash retainer for Board service and any committee chairperson service directly to Mr. N. Taylor, the Company would instead make a quarterly donation of such retainer in Mr. N. Taylor’s name to the Company’s foundation or another charity of his choosing and (ii) Mr. N. Taylor would not receive the restricted stock award to which non-employee directors are entitled under the director compensation program.

​

Director Stock Ownership Guidelines. In February 2019, the Board of Directors adopted stock ownership guidelines (the “Guidelines”) applicable to our executive officers and directors who are not members of management and who are not affiliated with KKR and Berkshire (the “Covered Directors”). Under the Guidelines, Covered Directors are required to hold a specific level of equity ownership, as a multiple of annual cash retainer. The Guidelines currently require Covered Directors to hold 5x the annual cash retainer. There is no required time frame within which a Covered Director must attain the applicable stock ownership level under the Guidelines. However, until the applicable ownership level is achieved, Covered Directors must retain 50% of vested shares net of stock option exercise and tax withholding. Shares that count toward these ownership guidelines include shares owned outright, shares held in the Company’s 401(k) or other retirement plan, shares of time-based restricted stock (whether vested or unvested) and vested stock options issued prior to the Company’s IPO. The retention requirement applies to all prior and future grants. As of January 2, 2021, Messrs. Fahs, Peeler and Tehle have met or exceeded their current ownership requirements and the remaining directors are subject to the restrictions in the guidelines until their ownership requirements are met.

2021 Proxy Statement       23

PROPOSAL NO. 2—AMENDMENT TO THE SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO ELIMINATE THE CLASSIFIED STRUCTURE OF THE BOARD OF DIRECTORS

Background

Our Second Amended and Restated Certificate of Incorporation (the “certificate of incorporation”) currently provides for a classified Board divided into three classes of directors, with each class elected for staggered three-year terms. In our 2020 proxy statement, the Board committed, upon the recommendation of the nominating and corporate governance committee, to submit for stockholder vote at our 2021 annual meeting a management proposal to amend our certificate of incorporation to eliminate the classified structure of the Board. At the time of our IPO, the Board believed that a classified board structure was an important piece of the Company’s governance structure in order to promote continuity and stability and was in the best interests of the Company and its stockholders.

Our Board carefully considered the classified board structure compared to an annual voting standard for the election of directors, analyzed current corporate governance trends, and evaluated the appropriateness of a classified Board in light of our overall corporate governance structure and ongoing stockholder engagement efforts.

Upon the recommendation of our nominating and corporate governance committee, the Board has determined that it is in the best interests of the Company and its stockholders to amend the certificate of incorporation to eliminate the classified structure of the Board and to provide for the annual election of all directors, and the Board recommends that the stockholders approve such an amendment.

Impact of the Proposal—Annual Elections of Directors

If approved by our stockholders, the proposed amendments to our certificate of incorporation would begin to eliminate the three classes of directors and provide for the annual election of directors beginning at the 2022 annual meeting of stockholders. Beginning with the 2024 annual meeting of stockholders, all directors will stand for election annually.

Description of Proposal

Article VI Section (A) of our certificate of incorporation currently provides that the Board is divided into three classes, with each class serving a staggered three-year term, and only one class being up for re-election each annual meeting. Specifically:

•

The directors designated as Class I directors have terms expiring at the Annual Meeting;

​

•

The directors designated as Class II directors have terms expiring at the 2022 annual meeting of stockholders; and

​

•

The directors designated as Class III directors have terms expiring at the 2023 annual meeting of stockholders.

​

If the proposed amendments are approved by our stockholders, the classified Board will be eliminated over a three-year period beginning at the 2022 annual meeting as follows:

•

At the 2022 annual meeting of stockholders, we would elect Class II directors to one-year terms;

​

•

At the 2023 annual meeting of stockholders, we would elect Class III directors and Class II directors to one-year terms; and

​

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•

At the 2024 annual meeting of stockholders and at all future annual meetings of stockholders, we would elect directors from all three classes to one-year terms.

​

The proposed amendment would not affect the existing terms of our directors, and the Class I directors who are nominated for election at the Annual Meeting will still be elected for three-year terms expiring at the 2024 annual meeting of stockholders, even if the proposed amendment is approved. The proposed amendment would not change the present number of directors or the Board’s authority to change that number or to fill any vacancies or newly created directorships.

Additionally, if the proposed amendments are approved by our stockholders, any director chosen by the Board to fill newly created directorships resulting from any increase in the authorized number of directors or any vacancies on the Board resulting from death, resignation, retirement, disqualification, removal from office or other cause will hold office until, if prior to the 2024 annual meeting of stockholders, the next election of the class into which such director shall have been elected or placed or, if from and after the 2024 annual meeting of stockholders, the next annual meeting of stockholders and, in each case, until such director’s successor shall have been duly elected and qualified, or until his or her earlier death, resignation, retirement, disqualification or removal.

Under Delaware law, directors serving on a classified board may be removed by stockholders only for cause (unless otherwise provided in the certificate of incorporation), while directors serving on a non-classified board may be removed by stockholders with or without cause. Thus, the proposed amendments if approved by our stockholders will also give our stockholders the ability to remove a director from the Board without cause beginning at the 2024 annual meeting of stockholders when the board is fully declassified.

The proposed amendments to our certificate of incorporation described in Proposal 2 are attached to this proxy statement as Appendix B, with additions of text indicated by underlining and deletions of text indicated by strike-outs. If Proposal 2 is approved by our stockholders, the proposed amendments contained in Appendix B would become effective upon the filing of a Certificate of Amendment to our certificate of incorporation reflecting such amendments with the Secretary of State of the State of Delaware.

If stockholders adopt Proposal 2, we intend to file such Certificate of Amendment promptly following the Annual Meeting.

If this proposal is not approved, our Board will remain classified and the Class II directors elected at the 2022 Annual Meeting will serve a term expiring at the 2025 annual meeting of stockholders.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” PROPOSAL 2 TO AMEND THE
CERTIFICATE OF INCORPORATION TO ELIMINATE THE CLASSIFIED STRUCTURE OF THE
BOARD OF DIRECTORS

2021 Proxy Statement       25

PROPOSAL NO. 3—AMENDMENT TO THE CERTIFICATE OF INCORPORATION TO ELIMINATE SUPERMAJORITY VOTING STANDARDS AND OTHER OBSOLETE PROVISIONS

Background

As discussed above, in our 2020 proxy statement, the Board committed, upon the recommendation of the nominating and corporate governance committee, to submit for stockholder vote at our 2021 annual meeting a management proposal to amend our certificate of incorporation to eliminate certain supermajority provisions within it. The supermajority voting standards described below were included in our certificate of incorporation at the time of our IPO to protect the interests of our stockholders by ensuring that a broad consensus of all stockholders was necessary to make changes to fundamental provisions of our certificate of incorporation and bylaws. Prior to its IPO, the Company was owned at times by Berkshire and KKR. The Company was controlled by affiliates of KKR and private equity funds managed by Berkshire until July 2018 and August 2019, respectively, when these affiliates and funds sold their remaining holdings of our common stock.

Our nominating and corporate governance committee and our Board carefully considered the advantages of super majority voting provisions, analyzed current corporate governance trends, and evaluated the appropriateness of super majority voting provisions in light of our overall corporate governance structure and ongoing stockholder engagement efforts. The Board has continued its ongoing review of evolving corporate governance practices.

Consistent with its strong commitment to the careful consideration of stockholder views, the Board has determined that it is in the best interests of the Company and its stockholders to amend the Company’s certificate of incorporation to remove supermajority voting requirements. The proposed amendments would also delete certain obsolete provisions relating to the prior equity ownership of KKR and Berkshire.

Description of Our Supermajority Standards. Article V, Section (A) of our certificate of incorporation provides that at any time when KKR and Berkshire (as defined in our certificate of incorporation) beneficially own collectively, in the aggregate, less than 40% in voting power of the stock of the Company entitled to vote generally in the election of directors, in addition to any vote required by applicable law, no amendment, alteration, change or repeal in any respect of any provision of Article V (amendments to our Certificate of Incorporation and Bylaws), Article VI (removal of directors), Article VII (director liability), Article VIII (ability for stockholders to take action by written consent), Article IX (completion and corporate opportunities), and Article X (business combinations) of our certificate of incorporation may be made, and no provision inconsistent therewith may be so adopted, without the affirmative vote of at least 662∕3% of the voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class.

Article V, Section (B) of our certificate of incorporation provides that at any time when KKR and Berkshire (as defined in our certificate of incorporation) beneficially own collectively, in the aggregate, less than 40% in voting power of the stock of the Company entitled to vote generally in the election of directors, in addition to any vote required by applicable law, the affirmative vote of the holders of at least 662∕3% in voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class, is required in order for the stockholders of the Company to alter, amend, repeal or rescind, in whole or in part, any provision of our Bylaws or to adopt any provision inconsistent therewith.

Article VI, Section (C) of our certificate of incorporation provides that at any time when KKR and Berkshire (as defined in our certificate of incorporation) beneficially own collectively, in the aggregate, less than 40% in voting power of the stock of the Company entitled to vote generally in the election of directors, in addition to any vote required by applicable

26       2021 Proxy Statement

law, directors may be removed from office only for cause and only by the affirmative vote of the holders of at least 662∕3% in voting power of all the then-outstanding shares of stock of the Corporation entitled to vote thereon, voting together as a single class.

Article X, Section (B)(3) of our certificate of incorporation provides that the Company shall not engage in certain business combinations with any interested stockholder (as defined in the certificate of incorporation) for a period of three (3) years following the time that such stockholder became an interested stockholder, unless at or subsequent to such time, the business combination is approved by the Board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 662∕3% of the outstanding voting stock of the Company that is not owned by the interested stockholder.

In addition, we are separately proposing to amend Article V to permit directors to be removed with or without cause. See Proposal 2 for more information. If Proposal 2 is not approved by our stockholders, directors will continue to be able to be removed only for cause.

Description of Proposal and Recommendation by the Board

After considering the advantages and disadvantages of the supermajority voting standards, including through discussions with our stockholders, the Board has determined it is in the best interests of the Company and our stockholders to amend our certificate of incorporation to eliminate the supermajority voting standards and other obsolete provisions described above. The Board has unanimously declared such amendments to be advisable and voted to recommend these amendments to the stockholders for adoption.

Impact of the Proposal—Majority Voting Standard

As a result, if the proposed amendments are adopted by our stockholders and implemented, the affirmative vote of a majority of the voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class, as required pursuant to the Delaware General Corporation Law would be required for (i) any future amendment, alteration, change or repeal in any respect of any provision of our certificate of incorporation, (ii) any future amendment, alteration, change or repeal in any respect of any provision of our Bylaws by our stockholders, and (iii) the removal of directors from office by stockholders,.

In addition, if the proposed amendments are adopted by our stockholders and implemented, the Company would be prohibited from engaging in certain business combinations with any interested stockholder (as defined in the certificate of incorporation) for a period of three (3) years following the time that such stockholder became an interested stockholder, unless at or subsequent to such time, the business combination is approved by the Board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of the holders of at least a majority of the voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon that is not owned by the interested stockholder, voting together as a single class.

This voting standard would be in addition to any other vote of the holders of any class or series of capital stock of the Company required in our certificate of incorporation (including any preferred stock designation) or by applicable law.

The proposed amendments would also delete certain obsolete provisions in our certificate of incorporation relating to the prior equity ownership of KKR and Berkshire.

The proposed amendments to our certificate of incorporation described in Proposal 3 are attached to this proxy statement as Appendix C, with additions of text indicated by underlining and deletions of text indicated by strike-outs. If Proposal 3 is approved by our stockholders, the proposed amendments contained in Appendix C would become effective upon the filing of a Certificate of Amendment to our certificate of incorporation reflecting such amendments with the Secretary of State of the State of Delaware. In connection with the proposed amendments to our certificate of incorporation in Proposal 3, the Board has adopted conforming amendments to our Second Amended and Restated Bylaws that will become effective upon our filing of such Certificate of Amendment with the Secretary of State of the State of Delaware.

If stockholders adopt Proposal 3, we intend to file such Certificate of Amendment promptly following the Annual Meeting.

2021 Proxy Statement       27

If Proposal 3 is not approved by our stockholders, the supermajority voting standards and obsolete provisions described above will remain unchanged and in effect.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” PROPOSAL 3 TO AMEND
THE CERTIFICATE OF INCORPORATION TO ELIMINATE THE SUPERMAJORITY
VOTING STANDARDS AND OTHER OBSOLETE PROVISIONS

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PROPOSAL NO. 4—NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION

Our stockholders are being asked to approve, in a non-binding advisory vote, the compensation of our named executive officers as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion. While the results of the vote are non-binding and advisory in nature, the Board intends to carefully consider the results of this vote.

The text of the resolution in respect of Proposal No. 4 is as follows:

“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed in this proxy statement pursuant to the rules of the SEC, including the Compensation Discussion and Analysis, compensation tables and any related narrative discussion is hereby APPROVED.”

In considering their vote, stockholders may wish to review the information on our compensation policies and decisions regarding the named executive officers presented in Compensation Discussion and Analysis on pages 30-40, the compensation tables and narrative discussion on pages 42-49, and the discussion regarding the compensation committee on page 41.

2021 Proxy Statement       29

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Executive Summary

Our executive compensation program is designed to attract and retain a talented executive team with the skills and qualifications to manage and lead the Company effectively. We strive to create an executive compensation program that strikes the right balance of paying for performance, motivating our leaders to contribute to the achievement of our financial goals, and focusing on long-term value creation for our stockholders, without taking undue risk.

This Compensation Discussion and Analysis contains a discussion of the material elements of compensation awarded to, earned by or paid to our named executive officers (“NEOs”), which include our Chief Executive Officer, Chief Financial Officer and our three other most highly compensated executive officers during the fiscal year ended January 2, 2021. Our NEOs for fiscal 2020 were:

The following information summarizes the Company’s 2020 performance and our key executive compensation actions and decisions. Additional information about these topics can be found in the Company’s 2020 Form 10-K and this proxy statement.

2020 Business Highlights

2020 was a challenging year with the outbreak of the COVID-19 global pandemic and the resulting impact on economic activity and businesses. Even with a year of unprecedented business challenges, we believe the Company has and continues to navigate through the pandemic and will emerge stronger and more resilient. With a safety-first approach in mind, we (1) prioritized the health and safety of our associates, doctors, patients and customers by closing our stores to the public for a period of time to implement enhanced safety protocols, (2) supported local health and government directives and guidance by implementing such protocols to assist in mitigating the spread of the pandemic at our stores and our corporate headquarters, and (3) served our patients and customers in a responsible and positive way by modifying our operations to comply with new public health guidelines and evolving customer expectations all while continuing to deliver low cost eye care and eyewear, a medical necessity, to the communities we serve.

Our Board and management team focused on responding appropriately to the pandemic and took certain operational and cost-cutting measures, as outlined below, to prioritize cash conservation and the prudent management of our business, while positioning the Company to safely conduct normal operations. Our fiscal 2020 compensation was consistent with our pay for performance and motivational philosophy and reflected the continued strength and resilience of our brand in challenging times.

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Throughout the course of fiscal 2020, we maintained a focus on keeping our customers and associates safe and healthy. The dedication and resiliency of our associates allowed us to reopen our stores and continue servicing our customers. Considering our performance and achievement despite the extraordinary circumstances of this year, we believe fiscal 2020 was ultimately successful and we are well positioned to capitalize on future opportunities for the Company.

In fiscal 2020, we achieved healthy financial and operational results, despite the pandemic, including:

•

Net income increased 10.6% to $36.3 million

​

•

Adjusted EBITDA1 increased 12.4% to $218.3 million

​

•

Adjusted Operating Income1 increased 17.4% to $134.1 million

​

•

Overall store count grew 4.7%, and fiscal 2020 ended with 1,205 stores

​

•

Total comparable store sales growth for the seven months ended January 2, 2021 (after we began gradually re-opening stores to the public) was 13.1%, and Adjusted Comparable Store Sales Growth1 for the seven months ended January 2, 2021 was 12.6%

​

•

Record operating cash flows increased from $165.1 million in 2019 to $235.0 million in 2020

​

•

Diluted EPS increased 9.1% to $0.44; Adjusted Diluted EPS1 increased 21.9% to $0.91

​

•

Our cash balance was $373.9 million as of January 2, 2021

​

(1) For an explanation of our non-GAAP financial measures and a reconciliation of Adjusted EBITDA, Adjusted Operating Income, Adjusted Comparable Store Sales Growth and Adjusted Diluted EPS to the most directly comparable GAAP measures, see Appendix A to this proxy statement.

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(1) For an explanation of our non-GAAP financial measures and a reconciliation of Adjusted EBITDA, Adjusted Operating Income, Adjusted Comparable Store Sales Growth and Adjusted Diluted EPS to the most directly comparable GAAP measures, see Appendix A to this proxy statement.

2020 Compensation Highlights

As outlined in the expense reduction initiatives highlighted above, our compensation committee, executive officers and board members took measures in 2020 to assist with the potential pandemic impact on the Company including:

•

A voluntary reduction in base salary by the Company’s CEO to $1 from March 29, 2020 to June 14, 2020.

​

•

A voluntary reduction in base salaries by the Company’s other executive officers, including all of the NEOs, by 30% from March 29, 2020 to June 7, 2020.

​

•

A voluntary election by the Company’s Board of Directors to forego their annual cash compensation for the second quarter of 2020.

​

The Company also focused on creating multiple resources for associates, including additional leave of absence and paid leave options, a payment of one-time appreciation bonuses to customer-facing associates, a grant of additional Company holidays in the fourth quarter of 2020 and paid benefits for associates furloughed in response to the pandemic.

Our 2020 compensation programs evolved to align with those found in the competitive market to continue attracting and retaining high-quality executives capable of executing the Company’s strategy and delivering value for stockholders. Key actions taken by the compensation committee include the following:

•

Base Salary—In February 2020, the compensation committee approved executive officer salary increases ranging from 3% to 11%, to more closely align compensation opportunities with the competitive market. These increases were slated to take effect in April 2020, however, with the temporary closure of our stores due to the pandemic beginning in March 2020, our executive officers voluntarily elected to take a reduction in their base salaries to assist with cash preservation at that time. Upon reopening of our stores, our executive officers returned to full pay in June, and the previously approved salary increases became effective on July 5, 2020.

​

•

Annual Cash Incentive Plan—Annual incentive awards pay out between 0% and 200% of target, based on performance against our Adjusted EBITDA target. Based on Adjusted EBITDA performance of $230.5 million (as defined under the fiscal 2020 Short-Term Incentive Plan (“STIP”)), the fiscal 2020 STIP funded at 91.22% of target. The compensation committee considered the Company’s performance in 2020 in navigating the pandemic, including the strong performance following the temporary store closures which were reflected in third quarter

​

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2020 results (2,860% increase in net income compared to third quarter 2019, an Adjusted EBITDA increase of 89.3% and an Adjusted Operating Income increase of 160%) and fourth quarter 2020 results (795% increase in net income compared to fourth quarter 2019, an Adjusted EBITDA increase of 118% and an Adjusted Operating Income increase of 281%).1 With the strong performance of the Company in the second half of 2020, the compensation committee used discretion to increase the incentive payout of STIP for executive officers by 8.78% to equal 100% of STIP target. Please see additional information in the footnotes to the Summary Compensation Table and the Short-Term Incentive Plan section on page 36.

•

Long-Term Incentive Program—The compensation committee adjusted the long-term incentive program in February 2020 and approved a grant to each of our NEOs for time-vesting stock options, time-vesting restricted stock units (“RSUs”), and performance-based restricted stock units (“PSUs”). PSUs will vest between 0% and 200% of target, based on performance against a three-year Adjusted EBITDA growth target as defined within the PSU award agreement. The compensation committee did not approve any changes to the Long-Term Incentive Program in light of the pandemic.

​

•

Pay-for-Performance—National Vision is committed to aligning executive compensation to the Company’s performance. The charts below illustrate that the majority of our NEOs’ compensation is performance-based.

​

Compensation Philosophy and Approach

Our mission is making quality eye care and eyewear more accessible and affordable. In order to do this, we must attract, engage and retain highly talented individuals who are committed to our core values of doing what is right, creating happiness every day and being energized to serve. Our compensation programs are designed to help us achieve these goals. We expect our executive team to possess and demonstrate strong leadership and management capabilities and continue to execute against our strategic growth initiative. To reward and retain our leaders, including our NEOs, we have designed a total compensation approach that rewards both short-term and long-term success.

Compensation Objectives

Our compensation program for executives is currently designed to support the following objectives:

•

Motivate executives to meet or exceed Company performance goals. A significant portion of each NEO’s total compensation is directly tied to the achievement of the Company’s overall business and performance goals.

​

•

Attract and retain talented executives. The Company seeks to provide overall levels of compensation that are market competitive to attract, retain and motivate highly qualified executives to continue to enhance long-term equity value.

​

•

Link the financial interests of executives and stockholders. In order to foster a strong relationship between stockholder value and executive compensation, a significant portion of compensation is composed of equity-based incentive awards. Additionally, NEOs are subject to stock ownership guidelines that ensure they retain a significant portion of their vested equity awards.

​

Our compensation packages are designed to promote integrity, leadership, teamwork, ownership and initiative by our employees whose performance and responsibilities directly affect our results. We strive to create competitive compensation

(1) For an explanation of our non-GAAP financial measures and a reconciliation of Adjusted EBITDA, Adjusted Operating Income, Adjusted Comparable Store Sales Growth and Adjusted Diluted EPS to the most directly comparable GAAP measures, see Appendix A to this proxy statement.

2021 Proxy Statement       33

packages for all employees that encourage them to achieve our long-term business goals without taking unnecessary risks. We believe that, to attract and retain talented senior executives, we must provide them with a competitive level of predictable compensation that rewards their continued service. We also believe that performance-based compensation plays a significant role in aligning senior executives’ interests with those of our stockholders and should be emphasized in the overall program structure. We motivate and reward NEOs for successfully executing our business strategy and believe that a combination of both short-term and long-term compensation creates an optimal pay-for-performance environment.

Consideration of Say on Pay Votes. We are pleased that stockholders representing over 99% of the shares voted on the Say on Pay Proposal at the 2020 annual meeting expressed their support and approval of our NEO compensation described in our 2020 proxy statement. Following the compensation committee’s review and consideration of this stockholder support, as well as the other factors discussed in more detail in “—Our Annual Compensation-Setting Process” below, the compensation committee determined to make no changes to its executive compensation program as a direct result of stockholder feedback. During 2019, we established our stockholder engagement program and sought feedback from stockholders on a range of topics, including executive compensation. We continued our stockholder engagement program in 2020 and sought feedback from stockholders representing approximately 63% of the Company’s outstanding common stock. See Stockholder Engagement earlier in this proxy statement for a description of our program.

Our Annual Compensation-Setting Process

Role of the Compensation Committee

Our executive compensation plans and programs are administered by our compensation committee. Our compensation committee is responsible for reviewing and approving, or recommending to our full Board of Directors, equity compensation grants and other aspects of compensation, including base salaries and the administration of our Short-Term Incentive Plan (“STIP”) for employees. Our compensation committee is also responsible for recommending to the full Board of Directors, the compensation of our CEO and determining and approving the compensation of other executive officers, as recommended by our CEO and Chief People Officer. At the beginning of each performance cycle, the compensation committee or the Board of Directors, as applicable, approves financial goals designed to align executive pay with company performance and stockholder interests, provide competitive pay opportunities dependent on performance, retain talent, create optimal stockholder value and mitigate material risk. These approvals include reviewing and setting performance goals under the STIP and Long-Term Incentive Program (“LTIP”), and reviewing and approving awards (including the terms and conditions of such awards) under the STIP and LTIP for all executive officers (other than the CEO).

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Role of Independent Members of the Board of Directors

Independent members of our Board assist in setting executive compensation by assessing the performance of the CEO, reviewing the compensation committee’s assessment of the CEO’s performance and approving the compensation of the CEO based on the recommendation of the compensation committee. During the temporary closure of the Company’s stores in response to the pandemic in the spring of 2020, the independent members of the Board also discussed and approved the temporary voluntary reductions in base salaries for the CEO and other executive officers until such time as it was determined to re-instate such salaries at their prior levels based on the Company’s performance once stores were safely re-opened in June.

Role of Management

In setting executive compensation for 2020, our CEO and our Chief People Officer worked closely with the compensation committee in managing the executive compensation program, along with gathering information for and attending meetings of the compensation committee. Our CEO made recommendations to the compensation committee regarding compensation for the executive officers (other than himself), including base salary amounts and equity compensation grants. Our CEO and CFO also provided input in discussions regarding the development of annual Company performance goals for which annual incentive payouts under our STIP and PSU awards under LTIP could be earned. Additionally, during this uniquely challenging year, our executive officers and the CEO worked closely with the independent members of the Board and kept them up to date with respect to executive officer voluntary salary reductions as Company stores were temporarily closed to the public and significant portion of employees were furloughed for the same time period.

Role of the Compensation Consultant

The compensation committee has engaged Meridian Compensation Partners, LLC (“Meridian”) to assist the Committee regarding various executive compensation matters and to serve as its independent compensation consulting firm. In connection with this appointment, in 2020 the compensation committee reviewed Meridian’s independence, including considering the factors specified in the NASDAQ listing standards and receiving confirmation by Meridian of its independent status. The compensation committee believes that Meridian is independent and that there is no conflict of interest between Meridian and the compensation committee. Meridian assists the compensation committee in reviewing the effectiveness and competitiveness of the Company’s executive compensation program, including an annual risk assessment of the program, and makes recommendations consistent with the Company’s pay philosophy, market trends, legal and regulatory considerations and the Company’s overall business needs. In addition to providing advice regarding executive compensation best practices, Meridian also provides market data as a background for recommendations regarding CEO and other executive base salary and annual and long-term incentives.

Use of Comparative Market Data

We aim to compensate our executive officers competitively. To gain a general understanding of current market compensation practices, our compensation committee reviewed the findings as presented in a market study conducted by Meridian in September 2019. The external market data reviewed included proxy data from the peer group companies described below and retail industry survey data. The peer group reflects a mix of industries that together represent our business and scope of operations (as measured by annual revenue, market capitalization and number of employees). At the time of the selection of the peer group, the Company was near the 43rd percentile of the peer group in revenue and 37th percentile in market capitalization. We believe it is appropriate for the peer group to reflect both the retail component as well as the health care aspects of our business. The data from the peer group below was reviewed in connection with compensation decisions for 2020. The peer group consisted of the following 15 companies:

As more fully described below under “—Compensation Elements,” the compensation committee reviewed the compensation data provided by Meridian and set total compensation for our NEOs accordingly. The compensation committee did not

2021 Proxy Statement       35

target a specific percentile with respect to the peer group in determining our NEOs’ total compensation, nor did it establish a prescribed mix of pay for our executives.

Compensation Elements

Program Design. Our executive compensation program has three main components: (1) base salary; (2) annual cash incentive compensation (STIP); and (3) long-term incentive awards (LTIP). Each component is designed to be consistent with the Company’s compensation philosophy.

Each element of the compensation program complements the others and, together, these elements are intended to achieve the compensation committee’s principal compensation objectives. When decisions about compensation for an executive officer are made, the impact on the total value of all these elements of compensation for the individual is considered. For executives, the compensation committee reviews competitive market data and establishes target total direct compensation opportunities (i.e., salary, annual incentive and annual long-term incentive targets) based on the following factors: corporate performance, competitive market data and the circumstances surrounding the executive’s initial hiring or promotion to a position with increased responsibilities.

Base Salary

We believe it is important to provide a competitive fixed level of pay to attract and retain talented and experienced executives capable of driving the Company’s business strategy. In determining the amount of base salary that each NEO receives, we look to the executive’s current compensation, time in position, any change in the executive’s position or responsibilities (including complexity and scope), and the relation of his or her position to those of other executives within the Company and in similar positions at peer companies. Base salaries are reviewed annually or at other times when appropriate and may be increased from time to time pursuant to such review. Base salary increases were approved for 2020 as outlined below.

As reflected in the table above, in December 2019, the compensation committee approved an adjustment to the base salary of Mr. Brandman from $300,000 to $350,000 effective January 2020 to reflect his role change to General Counsel and Corporate Secretary earlier in 2019. The compensation committee also approved a salary of $320,000 for Ms. Blackwood when she joined the Company in December 2019. In February 2020, the compensation committee approved adjustments to the base salaries of Messrs. Fahs, Moore and Clark, which were intended to be effective in April 2020.

However, on March 25, 2020, in light of the unprecedented impact of COVID-19 and the Company’s temporary closure of its stores to the public, the independent members of the Board also discussed and approved the voluntary reduction in base salaries for the NEOs by 30% and a reduction in the base salary for the CEO to $1. Upon the reopening of the Company’s stores, our executive officers returned to full pay in June 2020 and the previously approved salary increases became effective on July 5, 2020. Eligible associates who were impacted with a salary reduction or delayed salary increase due to the pandemic in spring 2020 also received salary increases effective in July 2020.

Annual Cash Incentive Program—Short Term Incentive Plan (STIP)

In fiscal year 2020, our executives participated in the STIP, which is an annual cash incentive program. The primary purpose of the STIP is to focus management on key measures that drive financial performance and to provide competitive bonus opportunities tied to the achievement of our annual financial and strategic growth objectives.

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We believe that tying NEO bonuses to Company performance goals encourages collaboration across the executive leadership team. For fiscal 2020, STIP awards were based on achievement of a STIP Adjusted EBITDA goal (with Adjusted EBITDA as defined on Appendix A plus STIP expense and change in the margin on unearned revenue). In addition, beginning with the STIP and LTIP awards granted in fiscal 2020, the Company updated its definition of certain non-GAAP measures, including Adjusted EBITDA. Adjusted EBITDA no longer excludes new store pre-opening expenses and non-cash rent. The compensation committee has reserved the ability to adjust the actual Adjusted EBITDA results to exclude the effects of unplanned or unusual items (whether favorable or unfavorable).

The compensation committee approved the STIP design, targets and Adjusted EBITDA goal in February 2020 as part of the annual compensation setting process. Each NEO’s target annual bonus under the STIP is expressed as a percentage of base salary with the targets ranging from 50% to 100% for 2020. Actual STIP awards were calculated by multiplying each NEO’s base salary by his or her payout percentage. For 2020, the STIP included threshold, target, and maximum levels of performance and corresponding payouts. Awards could be earned at more or less than target based on the pre-established scale set forth in the following table:

​

(1)

See Appendix A to this proxy statement for an explanation of STIP Adjusted EBITDA and a reconciliation to the most directly comparable GAAP measure

​

For performance percentages between the specified threshold, target, and maximum levels, payouts were interpolated on a straight-line basis.

For fiscal 2020, the Company’s STIP Adjusted EBITDA achieved was $230.5 million, resulting in a formulaic payout percentage of 91.22%.

Pursuant to the STIP, the compensation committee has the ability to exercise positive or negative discretion and award a greater or lesser amount to our NEOs than the amount determined by the scale above if it determines that circumstances so warrant. The committee took into account the Company’s performance during an unprecedented and challenging year, especially the strong performance following the temporary store closures which were reflected in third quarter and fourth quarter 2020 results. As part of those considerations, the compensation committee used discretion to increase the incentive payout of STIP for executive officers by 8.78% to equal payment at 100% of STIP target. A discretionary bonus to provide a target STIP payout was also made to all eligible non-executive officer associates.

The NEOs earned STIP awards for fiscal 2020 as follows, which are included in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table” later in this proxy statement. The discretionary bonus payments are outlined in the STIP awards table below and are included in the “Bonus” column of the “Summary Compensation Table” later in this proxy statement.

​

(1)

The discretionary bonus noted above is disclosed in the Bonus column of the Summary Compensation Table.

​

Long-Term Incentive Program

In connection with our IPO, our Board of Directors adopted, and our stockholders approved, the National Vision Holdings, Inc. 2017 Omnibus Incentive Plan (the “2017 Omnibus Plan”). The 2017 Omnibus Plan replaced the 2014

2021 Proxy Statement       37

Stock Incentive Plan for Key Employees of Nautilus Parent, Inc. and its Subsidiaries (the “2014 Stock Plan,” and together with the 2017 Omnibus Plan, the “Equity Incentive Plans”). The purpose of our 2017 Omnibus Plan is to provide a means through which to attract and retain key personnel and to provide a means whereby our directors, officers, employees, consultants and advisors can acquire and maintain an equity interest in the Company, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, thereby strengthening their commitment to the Company’s long-term success and aligning their interests with those of our stockholders.

2020 LTIP Awards

In February 2020, following an evaluation, with the assistance of Meridian, of the equity-based incentives for our executive officers, the compensation committee adopted a new long-term incentive program (“LTIP”). As part of our normal annual compensation cycle, all of our NEOs were granted the following awards under the 2017 Omnibus Plan: (1) time-vesting stock options (representing 25% of the total target value of fiscal 2020 LTIP awards for each NEO), (2) performance-vesting restricted stock units (“PSUs”) (representing 50% of the total target value of fiscal 2020 LTIP awards for each NEO), and (3) time-vesting restricted stock units (“RSUs”) (representing the remaining 25% of the total target value of fiscal 2020 LTIP awards for each NEO).

The following table reflects the target grant value and division of stock options, PSUs and RSUs granted to each NEO in February 2020.

2020 Stock Option Awards. The options granted in fiscal 2020 vest in three equal annual installments, with one-third of the total number of shares underlying the options vesting on each of the first, second, and third anniversaries of February 28, 2020, subject to the executive’s continued employment through the applicable vesting date.

2020 PSU Awards. PSU awards are earned over a three-year performance period and are conditioned on the Company’s achievement of certain Adjusted EBITDA growth targets, as set forth in the PSU award agreement. Vesting is based on an achievement factor which, in each case, ranges from a 50% payout for threshold performance, 100% for target performance, and 200% for maximum performance. To the extent that performance falls between the applicable threshold, target or maximum levels, payouts will be determined using linear interpolation. PSU performance goals and the target awards for our executive officers are established each February, shortly after the beginning of the fiscal year. The PSU awards granted in fiscal 2020 will be settled after the end of the respective three-year performance period, which began on the first day of our 2020 fiscal year and ends on the last day of our 2022 fiscal year. Beginning with the STIP and LTIP awards granted in fiscal 2020, the Company has updated its definition of Adjusted EBITDA, which will no longer exclude new store pre-opening expenses and non-cash rent. As a note, the 2019 PSUs remain subject to the prior definition of Adjusted EBITDA. These definitions are set forth in Appendix A to this proxy statement.

2020 RSU Awards. The RSUs granted in fiscal 2020 vest in three equal annual installments, with one-third of the total number of shares underlying the RSUs vesting on each of the first, second, and third anniversaries of February 28, 2020, subject to the executive’s continued employment through the applicable vesting period.

Management Stockholder’s Agreement

Each of our NEOs, other than Mr. Clark and Ms. Blackwood, is party to a Management Stockholder’s Agreement with the Company. The Management Stockholder’s Agreement, along with an applicable option agreement, generally govern each such NEO’s rights with respect to shares of common stock of the Company held by such NEO prior to our IPO, including such NEO’s stock option awards and contain certain rights and obligations of the parties thereto. The pre-IPO options are subject to certain put and call rights pursuant to the Management Stockholder’s Agreement.

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Changes for 2021 STIP and LTIP Awards

For fiscal 2021, the compensation committee has approved new performance metrics for the STIP and LTIP awards under the 2017 Omnibus Plan. The 2021 STIP awards are based off Adjusted Operating Income instead of Adjusted EBITDA, which was the metric used in prior years. We moved to Adjusted Operating Income for the STIP following the introduction of this non-GAAP measure in our Fiscal 2020 Outlook, as it reflects our profits, excluding interest and taxes, is a common profitability measure for companies, and injects heightened accountability for sound investment decisions and returns on those investments by our executives. Adjusted Operating Income under the STIP is defined as net income (loss), plus interest expense and income tax provision (benefit), further adjusted to exclude stock compensation expense, loss on extinguishment of debt, asset impairment, litigation settlement, secondary offering expenses, management realignment expenses, long-term incentive plan expenses, amortization of acquisition intangibles, and other expenses.

The LTIP awards granted in 2021 include the same vehicle mix as in 2020 of 25% time-based stock options, 50% PSUs and the remaining 25% in time-based RSUs. For fiscal 2021, the compensation committee approved new performance metrics for the PSUs. The 2021 PSUs will be based off two performance growth measures, Adjusted Operating Income and return on invested capital (ROIC), which will be weighted, 75% and 25%, respectively, for the three year performance period. As described above, Adjusted Operating Income is a common profitability measure. ROIC is a standard measure of a company’s ability to produce profitable return on all aspects of investment necessary to generate those returns and is a key measure for investor assessment of company performance.

The compensation committee took into account feedback from stockholders and the evolution of our public reporting and fiscal outlook measures in transitioning to these new performance metrics for our 2021 awards.

Perquisites and Other Benefits

The benefits and perquisites provided to our NEOs are not a material part of executive compensation and are largely limited to those offered to our employees generally, or that we have otherwise determined are necessary or appropriate to attract and retain talented executives. Our NEOs are eligible for specified benefits, such as group health, dental, disability and life insurance. These benefits are intended to provide competitive and adequate protection in case of sickness and the NEOs participate in these plans on the same basis as all other employees.

We provide specified perquisites to our NEOs when appropriate, including relocation as required. We also provide our executives, including our NEOs, with additional basic life insurance coverage and supplemental long-term disability and accidental death insurance. In addition, we provide our CEO with tax accounting services and a Young Presidents’ Organization (“YPO”) membership. The value of these perquisites and other personal benefits are reflected in the “All Other Compensation” column to the “Summary Compensation Table” and the accompanying footnotes below.

401(k) Savings Plan. Our eligible U.S. employees, including our NEOs, participate in the National Vision, Inc. 401(k) Retirement Savings Plan (the “401(k) Plan”). Eligible employees are eligible to enroll in the 401(k) Plan during the first month following three months of service with the Company. Under the 401(k) Plan, we match 50% of the first 3% of a participant’s contributions. The Company’s matching contributions vest pro rata over each of the following four years of employment with the Company.

Associate Stock Purchase Plan. We have maintained an Associate Stock Purchase Plan (the “ASPP”) since 2018. The ASPP provides all our eligible U.S. employees, including our NEOs, the opportunity to purchase up to $25,000 in our common stock annually at a 10% discount to the market price of our stock.

Severance Benefits

The Company provides severance benefits to its executives in order to offer competitive total compensation packages and to be competitive in the Company’s executive attraction and retention efforts. On December 11, 2018, the Board of Directors adopted and approved the National Vision Holdings, Inc. Executive Severance Plan (the “Executive Severance Plan”), which replaced our prior severance plan. The Executive Severance Plan provides for severance payments and benefits to eligible executives, including our NEOs, upon a termination of employment by the Company without cause or by the executive for good reason (each as defined in the Executive Severance Plan), in each case, subject to the (i) executive’s execution and non-revocation of a release of claims in favor of the Company and (ii) continued compliance with the executive’s confidentiality, non-interference and invention assignment obligations to the Company. See “Potential Payments upon Termination or Change in Control,” which describes the payments to which each of the NEOs may be entitled under the Executive Severance Plan.

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Restrictive Covenants

In addition, our NEOs have agreed to specified restrictive covenants, including confidentiality and non-disparagement covenants and covenants related to non-competition and non-solicitation of our employees, consultants and independent contractors at all times during the NEO’s employment, and for specific periods following the termination of employment for any reason. The post-employment restricted time periods are as follows: Mr. Fahs for twenty-four months after termination; Messrs. Moore and Brandman for eighteen months after termination; and Messrs. Clark and Ms. Blackwood for twelve months after termination.

Stock Ownership Guidelines

Our Board of Directors adopted stock ownership guidelines (the “Guidelines”) applicable to our executive officers. These Guidelines align the interests of our management and directors with those of our stockholders. Such executive officers will be required to hold a specific level of equity ownership, as a multiple of annual base salary or annual cash retainer, as applicable, as follows:

•

Chief Executive Officer: 6x annual base salary.

​

•

Other Executive Officers: 3x annual base salary.

​

There is no required time period within which an executive officer must attain the applicable stock ownership level under the Guidelines. However, until the applicable ownership level is achieved, executive officers must retain 50% of vested shares net of stock option exercise and tax withholding.

Shares that count toward these ownership guidelines include shares owned outright, shares held in the Company’s 401(k) or other retirement plan, shares of time-based restricted stock (whether vested or unvested) and vested stock options issued prior to the Company’s IPO. The retention requirement applies to all prior and future grants. As of the January 2, 2021, Messrs. Fahs, Moore and Brandman have met or exceeded their current ownership requirements and the remaining executive officers are subject to the restrictions in the guidelines until their ownership requirements are met.

Hedging and Pledging Policies

Our NEOs are subject to our hedging and pledging policies as outlined in the Company’s Securities Trading Policy described on page 20.

Compensation Risk Assessment

The compensation committee, with the assistance of Meridian, reviewed our incentive programs to assess whether the programs encourage inappropriate risk-taking. Based on its review, the compensation committee concluded that risks arising from the company’s compensation plans, programs and policies, considered as a whole, including applicable risk-mitigation features, are not reasonably likely to have a material adverse effect on the company.

Tax and Accounting Considerations

We consider the effect of tax, accounting and other regulatory requirements in designing and implementing compensation programs so that our programs meet regulatory requirements and efficiently deliver compensation. While these factors may impact plan designs, ultimately, decisions reflect the pay strategy of the Company and the intent of our programs.

Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) generally disallows tax deductions to publicly-held companies for individual compensation over $1 million paid to certain executive officers in a taxable year. Historically, compensation above $1 million could be deducted if it was considered “performance-based compensation” within the meaning of the Code, but as a result of tax legislation enacted at the end of 2017, this exemption is no longer available. The Company may award compensation that is not exempt from the deduction limits of 162(m).

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Compensation Committee Report

The compensation committee has reviewed and discussed the Compensation Discussion and Analysis with management. Based on its review and discussion with management, the compensation committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference in the Annual Report on Form 10-K for the fiscal year ended January 2, 2021 filed with the Securities and Exchange Commission.

Compensation Committee

Thomas V. Taylor, Jr., Chair
Heather Cianfrocco
Randy Peeler

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Compensation Tables

Summary Compensation Table

The following table presents summary information regarding the total compensation awarded to, earned by, or paid to each of our NEOs for services rendered in all capacities for the fiscal years ended January 2, 2021, December 28, 2019 and December 29, 2018.

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(1)

Mr. Clark joined the Company in June 2019, Mr. Brandman was appointed as an executive officer at the Company effective February 2019, and Ms. Blackwood joined the Company in December 2019.

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(2)

The Salary column reflects salaries paid in the years indicated to each of the NEOs. In 2020, each of our NEOs, other than the CEO, reduced their base salaries by 30% from March 29, 2020 until June 7, 2020 due to the pandemic-related temporary store closures. Our CEO reduced his base salary by nearly 100% cutting it to $1 from March 29, 2020 until June 14, 2020. Salary increases, if any, for each year are generally approved in February and effective in April of that year or in connection with a NEO’s promotion. In 2020, all salary increases approved in February were delayed until July 5, 2020.

​

(3)

The Bonus column reflects the discretionary bonus amount approved by the compensation committee in connection with its approval of the 2020 STIP Award that brought the total annual bonus amount for each NEO to be paid out at the 2020 Target STIP amount. See the “Annual Cash Incentive Program” in the Compensation Discussion and Analysis section above for further information. The 2019 amount for Mr. Clark represents his cash sign-on bonuses.

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(4)

The values in the Stock Awards column represent the aggregate grant date fair value for the stock awards granted in the applicable year, computed in accordance with FASB ASC Topic 718. These awards include PSUs, RSUs, one-time 2019 special retention RSU awards and 2019 sign-on awards of PSUs and RSUs. Awards with performance conditions are computed based on the probable outcome of the performance condition as of the grant date for the award. Information about the assumptions used to value these awards can be found in Note 5 “Stock Incentive Plans” in our 2020 Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on Company performance and the change in our stock price over time.

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For PSU awards granted in February 2020 to Messrs. Fahs, Moore, Clark, Brandman and Ms. Blackwood, the maximum shares payable and the grant date value assuming maximum performance are 64,620 or $2,250,068; 28,720 or $1,000,030; 9,192 or $320,065; 7,180 or $250,008; and 7,180 or $250,008, respectively.

(5)

The values in the Option Awards column represent the aggregate grant date fair value for the option awards granted in the applicable year, computed in accordance with FASB ASC Topic 718. The assumptions used to value these awards can be found in Note 5 “Stock Incentive Plans” in our 2020 Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on the change in our stock price over time.

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(6)

The Non-Equity Incentive Plan Compensation column reflects the cash bonus awarded under the STIP for the applicable year. The Company pays these amounts, if any, in the month of March following the year in which they are earned. The cash bonuses under the 2020 STIP were earned at 91.22% of target. Additional explanation of the non-equity incentive plan compensation for each NEO appears in “Annual Cash Incentive Program” in the Compensation Discussion and Analysis section above and below in the footnotes to the 2020 Grants of Plan-Based Awards table.

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42       2021 Proxy Statement

(7)

All Other Compensation for 2020 included:

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(a)

Our 401(k) Plan provides for a 50% matching contribution on the first 3% of participants’ pre-tax contributions up to IRS limits.

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(b)

Each of our NEOs is entitled to basic life insurance coverage of up to two times base salary up to $500,000.

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(c)

Each of our NEOs is entitled to supplemental long-term disability and accidental death insurance coverage. The total benefit maximum of both the basic and supplemental disability insurance coverage is $10,000 per month, and the maximum accidental death benefit is up to the lesser of two times base salary or $500,000.

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(d)

This column reflects $4,000 for YPO membership and $8,400 for reasonable cost of tax accounting services for Mr. Fahs, and fees paid for Ms. Blackwood’s taxable relocation expenses.

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2020 Grants of Plan-Based Awards

The following table sets forth information concerning NEO grants of plan-based awards during the fiscal year ended January 2, 2021.