DEF 14A of Pool Corp, Mar 28, 2024

DEF 14A of Pool Corp

Filed Mar 28, 2024 · FY20230000945841-24-000074

Open on EDGAR

  1. Election of Directors

    Election of Directors

  2. General

    General Our Bylaws provide that the size of our Board may be increased or decreased from time to time by resolution of the Board. Currently, the size of the Board is nine members. Following the 2024 Annual Meeting, we expect our Board to consist of eight members.

  3. Board Refreshment

    Board Refreshment As previously announced, Robert C. Sledd notified the Board that he will retire from service on the Board at the end of his current term and, accordingly, will not stand for re-election at the 2024 Annual Meeting. Mr. Sledd has served as a director since 1996. Harlan F. Seymour and Timothy M. Graven retired from the Board on May 4, 2023. We added Carlos A. Sabater and James D. Hope as directors during the second half of 2022.

  4. 2024 Board Nominees

    2024 Board Nominees The Board, upon the recommendation of the Nominating and Corporate Governance Committee, has nominated the eight individuals named in this Proxy Statement to serve another one-year term. All of the nominees currently serve as directors and were elected by our stockholders at the 2023 annual meeting of stockholders. Each of the nominees has indicated his or her intention to serve if elected; however, if any director nominee is unable or unwilling to take office at the Annual Meeting, your proxy may be voted in favor of another person or other persons nominated by the Board. If elected, each director nominee will serve a one-year term expiring at our 2025 annual meeting of stockholders or until his or her successor has been elected and qualified or until the director’s earlier resignation or removal. Our Bylaws include a majority voting standard in uncontested director elections. This means that if the number of shares voted against any sitting director is more than the number of shares voted for the election of that director, the director must submit a letter to the Board offering to resign. The Board, after considering the recommendation of the Nominating and Corporate Governance Committee, must then decide whether to accept, reject or take other action with respect to the resignation within 90 days from certification of the election results.

  5. Board Assessment and Membership Criteria

    Board Assessment and Membership Criteria At least annually, our Nominating and Corporate Governance Committee evaluates the effectiveness of our Board and Board committees and reviews the appropriateness of the composition and size of our Board and Board committees. In connection with identifying, evaluating and considering potential nominees, our Nominating and Corporate Governance Committee looks for candidates with relevant educational, business and industry experience with demonstrated character and judgment, in accordance with the policy set forth in our Corporate Governance Guidelines. Further, the committee seeks to identify individuals with the highest personal and professional ethics, integrity and values, who can commit themselves to representing the long-term interests of our stockholders. Nominees must also have an inquisitive and objective perspective, practical wisdom and mature judgment. Nominees must be willing to devote sufficient time to carrying out their duties and responsibilities effectively and should be committed to serving on our Board for a meaningful period of time. In reviewing the composition of our Board and potential nominees, our Nominating and Corporate Governance Committee also considers the director independence and committee requirements of The Nasdaq Stock Market LLC (Nasdaq) listing rules and all legal requirements. Our Board seeks independent directors with a broad diversity of experience, professions, skills, geographic representation and backgrounds, which we believe enhances the quality of the Board’s deliberations and decisions. We provide new directors with orientation materials to familiarize them with our business, operations and strategies to optimize their service as directors. Our Nominating and Corporate Governance Committee and Board believe the nominees fulfill the criteria described above. In addition, the Board has determined that six of our eight director nominees (including all committee members) are independent under Nasdaq listing rules. All four current members of our Audit Committee are “audit committee financial experts,” as defined by the SEC rules. In addition to reviewing these personal attributes, our Nominating and Corporate Governance Committee and Board have determined that the eight director nominees collectively possess a range of skills and experience suitable for overseeing our operations and industry. We describe these qualifications individually for each nominee below.

  6. Board Diversity

    Board Diversity The Board recognizes that its success hinges on its ability to successfully navigate a broad spectrum of challenges. To that end, the Board’s composition and culture are crucial, with diversity and refreshment serving as two fundamental concepts that enhance effective oversight. We are committed to maintaining a balanced and diverse board, with members who bring a variety of skills, expertise, experiences, perspectives, tenures and personal characteristics, including with regard to gender, age, race and ethnicity. We are also committed to a balanced approach to director tenure, allowing the Board to benefit from the knowledge and experience of longer-serving directors as well as fresh perspectives from newer directors. Reflecting this commitment, the Board has welcomed four new independent directors since 2018, three of whom are female or ethnically diverse. Also in the vein of refreshment, the Board has overseen important leadership transitions as several directors have assumed new committee chair roles. As noted in the table below, we are in compliance with Nasdaq Rule 5605(f), which requires companies to have at least two diverse board members. This table provides certain highlights of the composition of our Board members as of March 14, 2024. Each of the categories listed in the table below reflects the meanings in Nasdaq Rule 5605(f). To see our Board Diversity Matrix as of March 15, 2023, please see our proxy statement filed with the SEC on March 29, 2023.

  7. Board Diversity

    | Board Diversity Matrix (as of March 14, 2024) | | | | | | Total Number of Directors | 9 | | | | | | Female | Male | Non-Binary | Did Not Disclose Gender | | Part I: Gender Identity | | | | | | Directors | 2 | 7 | — | — | | Part II: Demographic Background | | | | | | Number of Directors Who Identify in Any of the Categories Below: | | | | | | African American or Black | — | — | — | — | | Alaskan Native or Native American | — | — | — | — | | Asian | — | — | — | — | | Hispanic or Latinx | — | 2 | — | — | | Native Hawaiian or Pacific Islander | — | — | — | — | | White | 2 | 5 | — | — | | Two or More Races or Ethnicities | — | — | — | — | | LGBTQ+ | — | | | | | Did Not Disclose Demographic Background | — | | | |

  8. Information about our Director Nominees

    Information about our Director Nominees Below is biographical information about each of our director nominees, including information regarding tenure as a director, business experience and qualifications, education and other company directorships. The summaries are not comprehensive, but describe the primary experiences, attributes and skills that led the Nominating and Corporate Governance Committee and our Board to nominate these individuals to serve as directors of our Company. In addition to the qualifications referred to below, we believe each of our directors has a reputation for demonstrating integrity, honesty, high ethical standards and sound business judgment.

  9. Information about our Director Nominees

    | | Business experience: Mr. Arvan has served as our president and chief executive officer since January 2019. He served as our executive vice president from January 2017 to January 2019 and as our chief operating officer from August 2017 to January 2019. Prior to joining Pool Corporation, Mr. Arvan served as chief executive officer of Roofing Supply Group from 2013 to 2015 and as president of GE/SABIC Polymershapes from 2004 to 2013. Other qualifications: Mr. Arvan graduated cum laude from the State University of New York at Utica with a Bachelor of Professional Studies in Business Administration. Among other qualifications, Mr. Arvan brings to the Board senior leadership experience, strong operating expertise and marketing and strategic planning knowledge. | | Peter D. Arvan Age: 58 Director since: 2019 Areas of expertise include: •Management •Strategic planning •Marketing •Operations •Industry Knowledge | |

  10. Information about our Director Nominees

    | | Business experience: Ms. Gervasi currently serves as a senior advisor and executive coach at My Next Season, a consulting company. From 2012 to 2020, she served as the chief human resources officer and later as an executive advisor to the CEO and board of directors of The Hartford Financial Services Group, Inc. (The Hartford; NYSE: HIG), an insurance and investment company, where she also served as senior vice president of human resources from 2010 to 2012. Prior to joining The Hartford, Ms. Gervasi held a variety of human resource positions with General Electric and Saudi Basic Industries (SABIC), where she gained a strong foundation in managing global workforces and driving cultural transformations. Other qualifications: Ms. Gervasi earned a bachelor’s degree in American Studies and Business from the University of St. Joseph, and she holds a Master of Business Administration in human resources from the Lally School of Management and Technology at Rensselaer Polytechnic Institute. Among other qualifications, Ms. Gervasi brings to the Board extensive leadership and human capital experience and a strong history of talent management across multiple industries. | | Martha S. Gervasi Independent Age: 62 Director since: 2021 Areas of expertise include: •Mergers and acquisitions •Strategic planning •Corporate governance •Succession planning •Human resources/compensation | |

  11. Information about our Director Nominees

    | | Business experience: From 2018 until his retirement at the end of 2022, Mr. Hope was executive vice president and chief financial officer of Performance Food Group Company (PFG, NYSE: PFGC); he served as PFG’s executive vice president of operations from 2014 to 2018. Prior to joining PFG, Mr. Hope spent 26 years in various executive leadership roles at Sysco Corporation (NYSE: SYY), most recently serving as executive vice president of business transformation. Before that, Mr. Hope progressed through several financial and sales leadership positions including senior vice president of sales and marketing and president and CEO of Sysco’s Kansas City operating company. Other qualifications: Mr. Hope holds a Bachelor of Business Administration from the University of Texas at Austin and brings to the Board a well-rounded background including public company accounting and reporting, deep experience in all aspects of mergers and acquisitions, strategic planning, and risk management and mitigation. | | James D. Hope Independent Age: 64 Director since: 2022 Areas of expertise include: •Finance •Strategic planning •Mergers and acquisitions •Operations •Distribution | |

  12. Information about our Director Nominees

    | | Business experience: Prior to her retirement, from 2017 to 2019, Mrs. Oler served as senior vice president/president, North America of W.W. Grainger, Inc. (Grainger; NYSE:GWW ), a distributor of maintenance, repair and operating supplies used by businesses and institutions, gaining strong expertise in business turnarounds and leading transformational initiatives, including a Canadian business turnaround, sales end market segmentation and new pricing models. She joined Grainger as regional sales vice president in 2002 and held several roles with increasing responsibility. Prior to joining Grainger, Mrs. Oler gained extensive sales and leadership experience with Alliant FoodService, Inc. from 1996 to 2002, Kraft Foods from 1986 to 1996 and I. Feldman & Company from 1973 to 1986. Other directorships: Mrs. Oler served as a director of Horizon Global Corporation (formerly NYSE: HZN), a leading manufacturer of branded towing and trailering equipment, from 2020 until Horizon was acquired by a private company in 2023. Other qualifications: Mrs. Oler holds a Bachelor of Science from the University of Maryland. Among other qualifications, Mrs. Oler brings to the Board extensive leadership and general management experience, a strong history of strategic go-to-market and sales team development, a proven track record of driving revenue growth and significant customer service experience. | | Debra S. Oler Independent Age: 69 Director since: 2018 Areas of expertise include: •Management •Marketing and sales •Business development •Turnarounds and business transformation •Distribution | |

  13. Information about our Director Nominees

    | | Business experience: Mr. Perez de la Mesa served as our president and chief executive officer from 2001 until his retirement at the end of 2018; he served as our president and chief operating officer from 1999 to 2001. Prior to leading Pool Corporation, he gained extensive general, financial and operations management experience with Watsco, Inc. from 1994 to 1999, Fresh Del Monte Produce B.V. from 1987 to 1994, International Business Machines Corp. from 1982 to 1987, and Sea-Land Service Inc./R.J. Reynolds, Inc. from 1977 to 1982. Other directorships: Mr. Perez de la Mesa serves as a director of Advanced Drainage Systems, Inc. (NYSE:WMS), a publicly traded manufacturer of pipe and related waterworks products in North America. Other qualifications: Mr. Perez de la Mesa, Cuban-American, holds a Bachelor of Business Administration from Florida International University and a Master of Business Administration from St. John’s University. Among other qualifications, Mr. Perez de la Mesa brings to the Board extensive management experience, more than 20 years of industry knowledge, a broad strategic vision for the Company and a strong financial acumen. | | Manuel J. Perez de la Mesa Age: 67 Director since: 2001 Vice Chairman since: 2019 Areas of expertise include: •Management •Strategic planning •International operations •Finance •Industry knowledge | |

  14. Information about our Director Nominees

    | | Business experience: Mr. Sabater retired from Deloitte & Touche LLP (Deloitte) as a senior global partner in 2020. Prior to his retirement, Mr. Sabater served in various senior leadership and operational roles with Deloitte, including as CEO for both the United States and global audit practices and as the managing partner for all of Deloitte’s businesses across North and South America. During his tenure at Deloitte, Mr. Sabater worked closely with the boards of directors and audit committees of several Fortune 500 companies and dynamic mid-sized public and privately held enterprises, gaining nearly 40 years of leadership, accounting and financial expertise. Other directorships: Mr. Sabater serves as a director of KBR, Inc. (NYSE: KBR), a science, technology and engineering solutions company and served on the board of PDC Energy, Inc. (Nasdaq: PDCE), an oil and gas company, until 2023. Other qualifications: Mr. Sabater, Cuban-American, received a Bachelor of Business Administration from Florida International University and is a certified public accountant. Among other qualifications, Mr. Sabater brings to the board a strong financial acumen and deep experience in SEC financial reporting. He has worked closely with United States and global regulators, including the Public Company Accounting Oversight Board (PCAOB) and the International Forum of Independent Audit Regulators (IFIAR). Mr. Sabater is National Association of Corporate Directors (NACD) certified. | | Carlos A. Sabater Independent Age: 65 Director since: 2022 Areas of expertise include: •Finance •Audit •Risk and crisis management •International operations •Corporate governance | |

  15. Information about our Director Nominees

    | | Business experience: From 1996 to 1999, Mr. Stokely served as president, chief executive officer and chairman of Richfood Holdings, Inc., a regional Fortune 500 wholesale food distributor and operator of retail grocery stores, prior to its acquisition by SuperValu Inc. Other qualifications: Mr. Stokely holds a Bachelor of Arts from the University of Tennessee. Among other qualifications, he brings to the Board experience in providing strategic, financial and risk management advice to companies engaged in a variety of industries, unique strategic insight, distribution and retail expertise and extensive senior leadership experience. Additionally, Mr. Stokely’s previous experience as chief executive officer of Richfood Holdings, Inc. afforded him with significant acquisition experience. | | John E. Stokely Independent Age: 71 Director since: 2000 Lead independent director since: 2003 Chairman since: 2017 Areas of expertise include: •Management •Finance •Operations •Corporate governance •Distribution | |

  16. Information about our Director Nominees

    | | Business experience: Mr. Whalen served as the president and chief executive officer of A.T. Cross Company (subsequently Costa Inc.) from 1999 to 2014, when the company was sold. A.T. Cross manufactured and marketed writing instruments and personal accessories under the Cross brand name and premium sunglasses under the Costa brand name. Prior to joining Cross, Mr. Whalen held various senior positions with Bausch & Lomb Inc. and the G. Heileman Brewing Company and was a consultant for Booz Allen Hamilton. Other directorships: Mr. Whalen serves as a director of Delta Apparel Inc. (NYSE: DLA), a diversified, branded apparel company. Other qualifications: Mr. Whalen graduated from Trinity College with a Bachelor of Arts with honors, and he received a Master of Business Administration from the University of Chicago. Among other qualifications, Mr. Whalen brings to the Board a background in developing and implementing operating strategies for global companies and extensive senior leadership experience. Additionally, Mr. Whalen’s previous success engineering a major restructuring as well as identifying and integrating a number of acquisitions provides him valuable strategic and operational insight. | | David G. Whalen Independent Age: 66 Director since: 2015 Areas of expertise include: •Finance •Strategic planning •Marketing •Mergers and acquisitions •International operations | |

  17. Overview of Fiscal 2023 Executive Compensation Changes

    Overview of Fiscal 2023 Executive Compensation Changes In February of 2023, after the Compensation Committee reviewed the independent compensation consultant’s findings, they made the following changes to our 2023 compensation design, each of which is more fully discussed in the sections that follow: ▪The Compensation Committee considered the performance and contributions of our NEOs in a challenging and highly competitive talent market and approved base salary increases to narrow the gap between our NEOs’ base salaries and the median base salaries of their peers. ▪Consistent with our philosophy of at-risk compensation, the Compensation Committee replaced the medium-term cash award Strategic Plan Incentive Program (SPIP) with an equity-based performance award based on a three-year adjusted diluted EPS CAGR. These shares, referred to as the Performance Shares-2, or PS-2 awards, will cliff vest on the third anniversary of the grant date, subject to attaining the achievement of the diluted EPS CAGR target, if realized. ▪The Compensation Committee approved a vesting schedule change that removes the length of service requirement for our performance-based restricted stock awards with return on invested capital (ROIC) as the performance-based vesting criterion (PS-1 awards). Previously, awards granted to employees with less than five years of service to the company cliff vested after five years, assuming achievement of the ROIC target. For grants beginning in 2023, all PS-1 awards will vest 50% three years after the grant date and 50% five years after the grant date, assuming achievement of the ROIC target, regardless of the employee’s length of service. While this vesting schedule moves us closer to market practice, it remains more restrictive than the majority of our peers who offer ratable vesting and/or shorter vesting periods. This change in the vesting schedule did not impact outstanding awards. Due to the transition from the SPIP cash awards to the PS-2 equity awards in 2023, the Summary Compensation Table figures for NEOs may be higher in 2023 and 2024 due to having both (i) a payout on the SPIP period ending in each of these years (from prior grants) and (ii) a grant date value for the replacement PS-2 equity awards. This is due to differing disclosure requirements for cash and equity awards, whereby cash awards are disclosed when paid and equity awards are disclosed when granted. However, the actual compensation level is not materially impacted by this change because the PS-2 equity awards cliff vest after 3 years based on performance (which is the same as the prior SPIP awards).

  18. Overview of Fiscal 2023 Performance Results

    Overview of Fiscal 2023 Performance Results Over the past four years, our business has experienced significant, but not linear, growth. In 2023, net sales decreased 10% to $5.5 billion, the second highest in company history. Net sales grew at a compound annual growth rate (CAGR) of 15% from 2019 to 2023. Gross profit was $1.7 billion in 2023, a decrease of 14% from the prior year but grew at a 16% CAGR from 2019. Operating expenses increased 0.6% to $913.5 million in 2023, reflecting lower volume-driven expenses that were more than offset by inflationary wage increases, higher rent and facilities costs and increased insurance and healthcare-related costs. Operating income for the year decreased 27% to $746.6 million, which represents a four-year CAGR of 22%. Earnings per share decreased 29% to $13.35 per diluted share compared to a record of $18.70 per diluted share in 2022. Without the impact from Accounting Standards Update (ASU) 2016-09, Improvements to Employee Share-Based Payment Accounting, in both periods, earnings per diluted share decreased 28% to $13.18 per diluted share compared to $18.43 per diluted share in 2022. From 2019 to 2023, our earnings per diluted share increased by a 20% CAGR or a 23% CAGR without the impact from ASU 2016-19. In 2023, we also reported record operating cash flows of $888.2 million and return on invested capital (ROIC) of 24.0%. We have delivered consistent positive returns to our stockholders over time, and in 2023 we continued our long history of increasing our dividend rate and conducting share repurchases. In May 2023, our Board of Directors increased our quarterly dividend per share by 10% and increased our share repurchase authorization by $186.4 million to $600.0 million. During the year, we repurchased nearly 843,000 shares, or 2.2% of our outstanding shares. In 2023, we returned $473.9 million of cash to shareholders while also reducing total debt outstanding by $333.5 million. The table below presents compound annual growth rates (CAGR) for our EPS and stock price performance as well as our total stockholder return (TSR) performance compared to our peer group median as of December 31, 2023. In addition to our peer group, we believe it is helpful to measure our performance against the S&P 500 Index, of which we have been a member since 2020, because (a) it is comprised of similar-sized public companies that represent the most likely alternative investments for investors and (b) we have no direct public company peers given the niche nature of our industry. Given that our compensation philosophy stresses the long-term growth of stockholder value, we believe that longer-term performance data provides the most appropriate comparisons.

  19. Overview of Fiscal 2023 Performance Results

    | | Pool Corporation | | | | | | | Adjusted(1) Diluted EPS CAGR | Stock Price CAGR | TSR CAGR | Peer Group Median TSR(2) CAGR | S&P 500 Index CAGR(3) | | 1-year | (28.6)% | 31.9% | 33.3% | 38.5% | 26.3% | | 3-year | 16.1% | 2.3% | 3.2% | 12.5% | 10.0% | | 5-year | 20.2% | 21.8% | 22.7% | 22.4% | 15.7% | | 10-year | 20.5% | 21.2% | 21.9% | 10.0% | 12.0% |

  20. Sound Governance Practices

    | | What we do: | | What we don’t do: | | ✓ | Our executive pay is predominantly performance-based and not guaranteed. | ✗ | We do not provide excessive perquisites to our executives. | | ✓ | Our variable compensation plans have caps on plan formulas. | ✗ | Directors and NEOs are prohibited from pledging and hedging their shares of company stock. | | ✓ | Our equity plans contain “double trigger” change of control vesting provisions. | ✗ | Our equity plans prohibit the repricing of underwater stock options. | | ✓ | We benchmark pay relative to the market and annually review companies in our peer group to ensure their appropriateness. | ✗ | We do not provide any change of control cash payments to our executive officers. | | ✓ | We maintain share ownership guidelines. | ✗ | We do not have any related party transactions with our executive officers. | | ✓ | We maintain executive compensation clawback provisions in accordance with Nasdaq listing standards and the requirements of the SEC. | | | | ✓ | The Compensation Committee, like all of our Board committees, is comprised solely of independent directors. | | | | ✓ | Our Compensation Committee periodically retains its own independent compensation consultant. | | | | ✓ | Restricted stock awards include performance-based vesting criteria. | | |

  21. Role of Compensation Consultant

    Role of Compensation Consultant Our Compensation Committee periodically retains an independent compensation consultant to review and comment on executive and director compensation. In an effort to continue to ensure that our executive compensation program properly aligns with the interests of our stockholders and remains competitive in the market, the Compensation Committee engaged Pearl Meyer & Partners, LLC (Pearl Meyer) in the fall of 2022 to review our executive and non-employee director compensation programs as well as our peer group composition. While they report directly to the Compensation Committee, the independent compensation consultant may interact with management when appropriate and necessary in order to obtain relevant executive compensation and company performance data. They may also seek input and feedback from management regarding their work product and analysis prior to presenting such information to the Compensation Committee in order to confirm their understanding of the company’s processes or to identify data questions or other issues, if any.

  22. Benchmarking and Establishment of Peer Group

    Benchmarking and Establishment of Peer Group Our compensation programs are designed to be competitive with companies of comparable size and industry with whom we compete for executive talent. As noted above, we believe that total target compensation for our NEOs should be closely aligned to the median total compensation of our peer group. We establish compensation targets for each executive position in the aggregate and by component based on a design that we believe will best achieve our strategic and financial objectives. The Compensation Committee compares our primary compensation components – base salary, annual cash incentives, and long-term incentive awards – individually and in the aggregate to the compensation of the most highly compensated executive officers of our “peer group” companies (the peer group is sometimes referred to as the “market”). These comparisons, which are based on compensation information published in the annual proxy statements of the peer group companies, provide the Compensation Committee with insight into executive pay and benefits at companies in similar market environments. The Compensation Committee reviews management’s evaluation of potential peer companies, approves the annual peer group and also reviews the annual executive compensation analysis that is prepared by management and, in some years, by the compensation consultant. In developing our peer group, we evaluate the following criteria: ▪organizational structure (public companies); ▪type of business (primarily wholesale distribution); ▪company size (based on revenue and market capitalization); and ▪peer group size (number of peer companies). In performing our evaluation, we focus on public companies that we believe would provide a comparable cross-industry subset of distributors. While we evaluate companies that may have some manufacturing or retail operations, we generally exclude companies from consideration if the majority of the business is not wholesale distribution. The Compensation Committee reviewed our 2022 peer group and added LKQ Corporation, a distribution company with revenue and market capitalization within our criteria ranges. No other changes were made to the peer group used in 2022. Accordingly, our 2023 peer group consisted of the following 14 companies:

  23. Benchmarking and Establishment of Peer Group

    | ⋅Applied Industrial Technologies, Inc. | ⋅LKQ Corporation | ⋅UFP Industries, Inc. | | ⋅Beacon Roofing Supply, Inc. | ⋅MSC Industrial Direct Co., Inc. | ⋅Univar Solutions Inc. | | ⋅Fastenal Company | ⋅Patterson Companies, Inc. | ⋅Watsco, Inc. | | ⋅GMS Inc. | ⋅Resideo Technologies, Inc. | ⋅W.W. Grainger | | ⋅Henry Schein, Inc. | ⋅SiteOne Landscape Supply, Inc. | |

  24. Benchmarking and Establishment of Peer Group

    The table below presents our revenue and market capitalization compared to the median of our 2023 peer group (based on data available in the fall of 2022 when the 2023 peer group was established) as provided by FactSet.

  25. Benchmarking and Establishment of Peer Group

    | (in millions) | Revenue | Market capitalization | | POOL(1) | $5,915 | $12,782 | | Peer group median(2) | 6,760 | 4,408 |

  26. Benchmarking and Establishment of Peer Group

    (1)POOL’s revenue reflects net sales for our most recent four quarters at the time of our analysis on October 10, 2022, and our market capitalization is as of October 10, 2022. (2)The peer group median revenue represents the median net sales for the most recent four quarters available as of October 10, 2022; the peer group median market capitalization is as of October 10, 2022. The Compensation Committee reviews each component of our NEOs’ compensation compared to the peer group. However, the Compensation Committee ultimately focuses on whether total compensation by design aligns closely with the peer group median total compensation. While we compare our CEO position to the CEO positions for our peer group, we compare our other NEOs to the peer group in the aggregate as opposed to by position because we believe it affords a better comparison overall as the positions and responsibilities for this group vary from company to company. Market medians and the ranges around them represent only beginning reference points. The Compensation Committee also uses its subjective judgment to set compensation targets, incorporating other relevant information such as individual executive performance and skills, long-term potential, experience in the position, retention considerations and internal equity among executives. The Compensation Committee also reviews the total annual compensation that each executive could potentially receive and, for perspective, reviews the previous year’s total compensation for each executive. The Compensation Committee has considered the impact that paying below the median of our peers might have on attracting, retaining and motivating senior management. The Compensation Committee believes that the fundamental philosophy of emphasizing pay-for-performance is the right one for our Company, and that our core compensation program can provide competitive or superior total compensation for senior management compared to our peer group given a reasonable economic environment. The Compensation Committee continues to believe that the design of our compensation program reflects a greater weighting of performance-based and at-risk compensation than the peer group median. Provided that our performance meets or exceeds expectations in future years, the Compensation Committee expects our NEOs will realize total compensation comparable or superior to the peer group median over time.

  27. Compensation Components

    | Compensation Component | Key Characteristics | Purpose | Metrics | | Base salary | Conservative level of fixed cash compensation based on responsibility and experience | Provide a fixed, baseline level of cash compensation | Skills and experience Market medians Individual performance | | Annual cash incentive (annual bonus) | Annual cash payment tied to performance during the fiscal year relative to pre-established performance goals | Reward for achieving our annual financial and business goals | Operating income Operating cash flow Individual objectives | | Strategic Plan Incentive Program (SPIP) Replaced in 2023 with PS-2 equity award | Medium-term cash performance opportunity | Provided a three-year, performance-based cash award | Diluted EPS | | Long-term equity awards | Variable compensation comprised of performance-based restricted stock awards, stock options or a combination of the two | Align executive performance with stockholder interests and long-term goals | PS-1: ROIC PS-2: Diluted EPS |

  28. Base Salary

    Base Salary Base salaries provide a fixed element of compensation and help achieve the objectives outlined above by attracting and retaining strong talent. Our plan design is for total executive compensation to be at the peer group’s median total compensation, assuming comparable performance levels. However, because of our emphasis on performance-based elements of compensation, base salaries for our NEOs have historically been substantially below market as compared to our peers. We review salaries annually and may make adjustments in response to general changes in market pay for executive talent, changes in responsibility for individual NEOs and each NEO’s job performance over time. For fiscal 2023, the Compensation Committee and Pearl Meyer conducted a deeper study of the competitiveness of our base salaries given that for each of our NEOs, their base salaries were below or near the floor of the base salaries of executives holding comparable positions at the companies in our peer group. The committee also took into consideration individual performance and contributions, particularly in a challenging and highly competitive talent market environment. Most notably, our CEO’s base salary was below the 10th percentile and our CFO’s base salary was below the floor. In recognition of their strong and stable leadership and to narrow the gap between their base salaries and the median base salaries of the CEOs and CFOs of the companies in our peer group, the Compensation Committee determined that for our CEO and CFO, base salary increases of 43% and 50%, respectively, were appropriate. After these increases, which positioned the base salaries of our CEO and CFO just below the 25th percentile of their peers, their base salaries continue to align with our pay-for-performance philosophy, under which our NEOs’ total compensation is more heavily weighted toward the at-risk components. The Compensation Committee further determined that for Mr. St. Romain, a base salary increase to $450,000 (a 28.6% increase) was appropriate to place him between the 25th and 50th percentile of his peers and also in recognition of his promotion to and expanded responsibilities as senior vice president, his tenure with the company and his individual performance and leadership through a period of high growth. In February 2023, the Compensation Committee increased executive officer salaries to the following amounts:

  29. Annual Incentive Plan

    Annual Incentive Plan

  30. (Summary Compensation Table, Column 5)

    (Summary Compensation Table, Column 5)

  31. (Grants of Plan-Based Awards, Columns 3-4)

    (Grants of Plan-Based Awards, Columns 3-4) We use an annual cash incentive award (annual bonus) to focus executive behavior on short-term goals for growth, financial performance and other specific financial and business improvement metrics. We offer our executives the opportunity to earn goal-oriented awards that are responsive to changing internal and external business conditions and objectives from year to year. Early each year, the Compensation Committee evaluates the prior year’s performance against the target goals and then approves annual bonus payments for that year and reviews and approves goals for each NEO for the current year. Annual bonus payments, if any, are normally made in late February after the end of the performance period in which the bonuses were earned. Under our Pool Corporation Executive Officer Annual Incentive Plan (the AIP), the Compensation Committee has the discretion to structure the annual bonus program as it deems appropriate, including designing an “umbrella plan” under which one or more performance goals are established to fund a pool from which individual awards, which may be subject to additional performance criteria, are then made. 2023 Plan Design In February 2023, the Compensation Committee established the performance metrics applicable to awards under the AIP for 2023, the target bonus payable to each NEO under the AIP, and set the maximum bonus opportunity for each NEO under the AIP at 200% of the target bonus. Similar to our 2022 plan, our Compensation Committee included return on invested capital (ROIC) as a threshold performance metric, which must be achieved in order for any payments to be made under the AIP. Under this plan design, the Company must achieve ROIC of 10% or higher for fiscal year 2023 to fund a bonus pool to satisfy annual bonus payments to all of our executive officers. Consistent with our compensation philosophy, the Compensation Committee set the 10% ROIC performance metric slightly higher than the median three-year average ROIC of the companies in our peer group. The Compensation Committee then set individual bonus metrics (described below) to determine the amounts awarded to each of our NEOs. Our ROIC calculation numerator is net income before after-tax interest and other non-operating expenses, net, and the denominator is the sum of total long-term debt (including the current portion) and stockholders’ equity at fiscal year end. Calculated in this way, our ROIC for the year ended December 31, 2023, was 24.0%. Because our 2023 ROIC was greater than 10%, the bonus pool for 2023 under the AIP was funded. For 2023, our NEOs’ annual bonus targets were based on the following two performance criteria categories: ▪specific financial measures (operating income and operational cash flow); and ▪other specific business objectives tailored to each NEO’s area of responsibility. The metrics for all NEOs are designed to be challenging and encourage improvement over the status quo. For 2023, the Compensation Committee used operating income as the primary performance financial metric for annual bonuses applicable to all NEOs, as set forth in the table below. While the Compensation Committee may authorize adjustments to operating income as specified by our compensation plans, no such adjustments were made in 2023. We believe operating income is a strong indicator of medium-term and long-term stockholder value as it has had a strong long-term correlation with our stock price over time, it is performance-based, and its use in our cash award plans supports our business goal of providing a superior return to our stockholders. Further, operating income is not impacted by tax benefits related to share-based awards or changes to federal tax rates. The Compensation Committee has evaluated whether our reliance on operating income creates unnecessary risk and does not believe that it does. The annual bonus plans for Mr. Arvan, Mrs. Hart and Mr. St. Romain also included operational cash flow as a financial metric. As explained in more detail below, the Compensation Committee authorized the use of adjusted net cash provided by operations in order to determine the achievement of this metric. The table below sets forth the annual cash incentive target, expressed as a percentage of base salary, and the actual amounts earned for each of our NEOs under the 2023 annual bonus program.

  32. (Grants of Plan-Based Awards, Columns 3-4)

    | Executive (1) | Target as a % of Base Salary(2) | Target $ | Achievement as a % of Target | Award Earned | | Mr. Arvan | 100% | $800,000 | 55.0% | $440,000 | | Mrs. Hart | 75% | 337,500 | 66.7% | 225,000 | | Ms. Neil | 75% | 243,750 | 66.7% | 162,500 | | Mr. St. Romain | 100% | 450,000 | 33.0% | 148,500 |

  33. (Grants of Plan-Based Awards, Columns 3-4)

    (1)Per the terms of his offer letter when he joined the Company in July 2023, Mr. Neff was guaranteed a bonus payout of $250,000 for the 2023 fiscal year only. (2)The weight for each component of the annual incentive plan, expressed as a percentage of the target payout is as follows:

  34. (Grants of Plan-Based Awards, Columns 3-4)

    | Executive | Consolidated Operating Income | Group Operating Income | Operating Cash Flows | Other Specific Business Objectives | | Mr. Arvan | 70.0% | N/A | 15.0% | 15.0% | | Mrs. Hart | 66.7% | N/A | 6.7% | 26.6% | | Ms. Neil | 66.7% | N/A | N/A | 33.3% | | Mr. St. Romain | 55.0% | 30.0% | 5.0% | 10.0% |

  35. (Grants of Plan-Based Awards, Columns 3-4)

    For Mr. St. Romain’s annual bonus, the committee considered the structure of his plan, which was more heavily weighted toward financial measures than the other NEOs. After reviewing his calculated bonus payout, the committee increased his annual bonus payout by $50,000. The table below sets forth the threshold, target, and maximum for each of the financial performance metrics along with the actual achievement as a percentage of the target. Payouts for each performance measure are prorated on a straight-line basis for results falling between the threshold, target, and maximum amounts. Each NEO may earn between 0% and 200% of their target cash incentive opportunities. If threshold performance goals are not achieved, the NEOs are not entitled to a payout under the AIP.

  36. (Grants of Plan-Based Awards, Columns 3-4)

    | Performance Metric | Threshold (0%) | Target (100%) | Maximum (200%) | Actual Results | Payout % of Target | | Operating Income (1) | $850.0 | $950.0 | $1,050.0 | $746.6 | 0% | | Operating Cash Flow (2) | 80% | 90% | 100% | 134.4% | 200% |

  37. (Grants of Plan-Based Awards, Columns 3-4)

    (1)Amounts in millions (2)The operational cash flow measure applies only to Mr. Arvan, Mrs. Hart and Mr. St. Romain. We reported net cash provided by operations that was 169.8% of net income for the year ended December 31, 2023. For the purpose of determining the achievement of the operational cash flow measure, the Compensation Committee authorized the use of adjusted net cash provided by operations, which included the reversal of the consideration to exclude the impact of significant inventory purchases made in 2022 that allowed for improvements in gross margin and better product availability. During 2023, we reduced inventory by $225.6 million after shorter vendor lead times ensured our ability to serve customers. For determination of the performance metric, adjusted net cash provided by operations for the year ended December 31, 2023, was 134.4% of net income. In an effort to enhance and highlight our focus on operating cash flow, the Compensation Committee provided Mr. Arvan, Mrs. Hart, and Mr. St. Romain with the ability to earn an additional incentive of 5% of base salary if the net cash provided by operations exceeded 100% of net income, provided that under no circumstances can the NEOs’ award payout exceed the maximum of 200% of the annual bonus target for any NEO. As noted above, adjusted net cash provided by operations exceeded 100% of net income, and the NEOs earned the additional 5% incentive. Regarding other specific business objectives, each reflects operational improvements related to an NEO’s specific responsibilities and reflects our focus on continued growth and improvement in execution over our past performance. In each case, these objectives represent stretch goals that each executive may or may not be able to achieve. Mr. Arvan determines the performance of the NEOs other than himself, and the Board determines the extent to which Mr. Arvan has achieved his objectives. The table below describes the portion of each NEO’s target bonus assigned to other specific business objectives and the payout achieved for each officer.

  38. (Grants of Plan-Based Awards, Columns 3-4)

    | | Other Specific Business Objectives (1) | | | | Executive | Weight | Payout as a % of Target | Payout $ | | Mr. Arvan | 15.0% | 133% | $160,000 | | Mrs. Hart | 26.6% | 175% | $157,500 | | Ms. Neil | 33.3% | 200% | $162,500 | | Mr. St. Romain | 10.0% | 180% | $81,000 |

  39. (Grants of Plan-Based Awards, Columns 3-4)

    (1) The other specific business objectives for each of our NEOs were:

  40. (Grants of Plan-Based Awards, Columns 3-4)

    | Mr. Arvan | | | | ▪ return on invested capital | | | ▪ organizational planning and development | | | ▪ specific tactical goals | | Mrs. Hart | | | | ▪ other financial objectives | | | ▪ capital resource allocation | | | ▪ strategic planning | | | ▪ people initiatives | | Ms. Neil | | | | ▪ business development and organizational support | | | ▪ corporate governance | | | ▪ litigation management | | | ▪ compliance and people initiatives | | Mr. St. Romain | | | | ▪ drive strategic actions | | | ▪ people initiatives | | | ▪ improve customer experience |

  41. Strategic Plan Incentive Program (SPIP)

    Strategic Plan Incentive Program (SPIP) The SPIP is a cash-based, pay-for-performance award program that links our medium-term financial performance with the total cash compensation paid to senior management. Historically, the SPIP served to complement our annual bonus program and the longer-term value creation potential provided by equity awards. In 2023, the Compensation Committee did not grant any awards under the SPIP but rather replaced this compensation component with an equity-based performance award. This change did not affect the outstanding SPIP awards granted in 2021 and 2022 with performance periods ending in 2023 and 2024. Cash payments to our NEOs under the SPIP are based on the three-year compound annual growth rate (CAGR) of our diluted EPS as illustrated in the table below.

  42. Strategic Plan Incentive Program (SPIP)

    | Three-Year Adjusted Diluted EPS CAGR | Award Achieved | % of Salary Earned (1)(2) | | 5% | Threshold | 50% | | 10% | Target | 100% | | 20% | Maximum | 200% |

  43. Strategic Plan Incentive Program (SPIP)

    (1)Mr. Neff joined the Company in the second half of 2023 and thus does not have any SPIP awards outstanding. (2)The cash award earned between the specified targets is calculated on the basis of straight-line interpolation. The following table presents our three-year adjusted diluted EPS CAGR and corresponding payouts as a percentage of target for each of the last three fiscal years. The Compensation Committee may authorize EPS adjustments as specified under the SPIP.

  44. Strategic Plan Incentive Program (SPIP)

    | Three-Year Performance Period | SPIP Payout as a Percentage of Target | Three-Year EPS CAGR | | January 1, 2021 - December 31, 2023(1) | 161.1% | 16.1% | | January 1, 2020 - December 31, 2022(2) | 200.0% | 46.8% | | January 1, 2019 - December 31, 2021(3) | 200.0% | 42.4% |

  45. Strategic Plan Incentive Program (SPIP)

    (1)Our diluted EPS for the year ended December 31, 2023 was $13.35. We calculated the three-year EPS CAGR using 2023 adjusted diluted EPS of $13.18, which excludes a $0.17 per diluted share tax benefit from ASU 2016-09. (2)Our diluted EPS for the year ended December 31, 2022 was $18.70. We calculated the three-year EPS CAGR using 2022 adjusted diluted EPS of $18.43, which excludes a $0.27 per diluted share tax benefit from ASU 2016-09. (3)Our diluted EPS for the year ended December 31, 2021 was $15.97. We calculated the three-year EPS CAGR using 2021 adjusted diluted EPS of $15.18, which excludes a $0.05 benefit from the recovery of a previously impaired note and a $0.74 per diluted share tax benefit from ASU 2016-09. The following table presents the remaining award outstanding under the SPIP:

  46. Strategic Plan Incentive Program (SPIP)

    | Grant Year | Three-Year Performance Period | Baseline EPS | EPS for Minimum Payout (5% CAGR) | EPS for Target Payout (10% CAGR) | EPS for Maximum Payout (20% CAGR) | | 2022 | January 1, 2022 - December 31, 2024 | $15.18(1) | $17.57 | $20.20 | $26.23 |

  47. Strategic Plan Incentive Program (SPIP)

    (1)The Compensation Committee set the baseline EPS at $15.18 per diluted share, which excludes a $0.74 per diluted share tax benefit related to ASU 2016-09 and a $0.05 benefit from the recovery of a previously impaired note.

  48. Long-Term Equity Award

    Long-Term Equity Award

  49. (Grants of Plan-Based Awards, Column 6)

    (Grants of Plan-Based Awards, Column 6)

  50. (Outstanding Equity Awards at Fiscal Year-End)

    (Outstanding Equity Awards at Fiscal Year-End) Equity grants are a key element of our total compensation package that closely align the interests of our NEOs with those of our stockholders, create retention incentives, and reward long-term performance. In 2023, the Compensation Committee issued two types of awards to our NEOs.

  51. PS-1 awards

    PS-1 awards Our PS-1 awards are performance-based restricted stock awards with return on invested capital (ROIC) as the performance-based vesting criterion. These shares vest 50% on the third anniversary of the grant date and 50% on the fifth anniversary of the grant date, provided that we achieve three-year average ROIC of 10%. If the performance metric fails to be met, the performance period may be extended; however, if the metric is not met by the end of the extended performance period, then all shares of performance-based restricted stock will be immediately forfeited and canceled for these grants. We believe ROIC is an important indicator of financial health and company growth and is consistent with our compensation philosophy that compensation must be linked to corporate performance. For more information on our ROIC calculation and 2023 results, please see the “Annual Incentive Plan” section above.

  52. PS-2 awards

    The Committee determines individual equity grant awards based on relevant market data and each employee’s responsibilities and performance. Our restricted stock awards reward performance because vesting of the award is conditioned on our Company’s long-term performance. Restricted stock awards convey all the rights of a stockholder, including the right to vote and receive dividends, but recipients may not sell or transfer the shares until they are fully vested. Similarly, to the extent granted, we believe that stock options align executive performance with stockholder interests because employees have a vested interest in our stock performance and the option’s value only appreciates from stock price improvement after the grant date. In 2023, the Compensation Committee allowed each of the NEOs to elect to receive his or her PS-1 equity grant in the form of performance-based restricted stock awards, stock options, or a combination of the two. As noted above, the Compensation Committee believes that both stock options and restricted stock awards are closely aligned with the interests of stockholders and by offering our NEOs this choice, it serves our objectives of retention and motivation. In 2023, each of our NEOs elected to receive 100% of their respective PS‑1 equity awards in the form of performance-based restricted stock awards. Based on the total grant date fair value of equity-based awards granted in 2023, the equity-based awards granted to Mr. Arvan as CEO were approximately 4.6 times the average total fair value of the equity-based awards to our other NEOs in recognition of his substantially greater responsibilities and in keeping with his compensation mix. Mr. Arvan’s duties and responsibilities encompassed all aspects of our management and operations and were greater in scope and collectively more significant in nature than those of our other NEOs. Currently, the Compensation Committee grants annual equity awards during the first quarter of each year, typically in February. This annual grant coincides with the annual performance review and compensation adjustment cycle. The Compensation Committee may also grant equity awards to employees hired during the year. As an employee’s responsibility increases, equity grants become a greater percentage of his or her total compensation, equating to more at-risk compensation for higher level employees.

  53. (Nonqualified Deferred Compensation)

    (Nonqualified Deferred Compensation) The Pool Corporation 401(k) Plan (the 401(k) Plan), which is generally available to both management and non-management personnel, allows eligible employees to defer eligible compensation up to the Internal Revenue Code limit. For 2023, the limit was $22,500, or $30,000 for participants who attained the age of 50 during the plan year. We contribute a 100% match on the first 3% of eligible compensation deferred, a 50% match on deferrals between 3% and 5% and no match on deferrals over 5%. The PoolCorp Nonqualified Deferred Compensation Plan (the Deferred Compensation Plan) allows certain employees who occupy key management positions (including all of the NEOs) to defer eligible cash compensation and enables participants to receive matching contributions on the same percentage of eligible compensation as offered under the 401(k) Plan. Our total Company matching contributions given to a participant under the 401(k) Plan and the Deferred Compensation Plan during any one year may not exceed 4% of a participant’s eligible cash compensation. The purpose of the Deferred Compensation Plan is to make total retirement benefits for our employees who earn over the qualified plan limits commensurate with those available to other employees as a percentage of pay. We do not provide any defined benefit pension arrangements nor do we provide any other compensation arrangements to our NEOs other than those discussed in this proxy statement or available to all Company employees.

  54. (Summary Compensation Table, Column 6)

    (Summary Compensation Table, Column 6) We believe that perquisites should be limited. In line with this philosophy, our executives are offered few benefits that are not generally available to all of our employees. We provide certain employees, including the NEOs, with a company vehicle, including maintenance, insurance and fuel. We allow these employees to use their vehicles for personal and business reasons. Officers may choose to purchase their company vehicle at book value at any point. Additionally, we waive medical and dental monthly premiums for each of the NEOs. Beginning in 2023, we offer annual physicals, including comprehensive diagnostic tests, to our CEO and other officers. These tests reduce risk by identifying possible health matters for key employees, helping us to ensure that members of our executive management team are in good health and available to work. The Company does not own any aircraft or have any contract for air charter service and does not reimburse NEOs for club or like memberships. Excluding benefits available to all full-time employees, NEO benefits and other compensation represent approximately 2.0% of the NEO total compensation in the aggregate.

  55. FISCAL 2023 SUMMARY COMPENSATION TABLE

    FISCAL 2023 SUMMARY COMPENSATION TABLE

  56. FISCAL 2023 SUMMARY COMPENSATION TABLE

    | Name and Principal Position | Year | Salary | Bonus (2) | Stock Awards (3) | Non-Equity Incentive Plan Compensation (4) | All Other Compensation (5) | Total | | Peter D. Arvan | 2023 | $800,000 | $— | $3,500,355 | $1,728,760 | $74,373 | $6,103,488 | | President and | 2022 | 560,000 | — | 3,000,163 | 2,152,355 | 134,179 | 5,846,697 | | Chief Executive Officer | 2021 | 525,000 | — | 2,889,832 | 2,100,000 | 60,552 | 5,575,384 | | Melanie M. Hart | 2023 | 450,000 | — | 1,000,817 | 949,928 | 99,643 | 2,500,388 | | Vice President and | 2022 | 300,000 | — | 599,866 | 987,654 | 59,264 | 1,946,784 | | Chief Financial Officer | 2021 | 250,000 | — | 516,229 | 875,000 | 44,257 | 1,685,486 | | Jennifer M. Neil | 2023 | 325,000 | — | 525,804 | 686,059 | 76,377 | 1,613,240 | | Senior Vice President, Secretary | 2022 | 300,000 | — | 500,166 | 1,020,654 | 81,347 | 1,902,167 | | and Chief Legal Officer | 2021 | 270,000 | — | 464,343 | 945,000 | 81,219 | 1,760,562 | | Kenneth G. St. Romain | 2023 | 450,000 | 50,000 | 1,201,123 | 873,428 | 108,954 | 2,683,505 | | Senior Vice President | 2022 | 350,000 | — | 899,800 | 1,188,861 | 112,937 | 2,551,598 | | | 2021 | 335,000 | — | 877,458 | 1,172,500 | 102,867 | 2,487,825 | | Kristopher R. Neff (1) | 2023 | 196,154 | 250,000 | 350,445 | — | 50,507 | 847,106 | | Vice President, Strategy and Corp. Development | | | | | | | |

  57. FISCAL 2023 SUMMARY COMPENSATION TABLE

    (1)Mr. Neff joined the company in July 2023. (2)Under the terms of Mr. Neff’s offer letter, he was guaranteed a minimum bonus of $250,000 for 2023. (3)Amounts shown do not reflect compensation actually received by the NEOs. Instead, these amounts reflect the total estimated grant date fair value for the performance-based restricted stock awards granted in 2023, which is based on the closing price of our Common Stock on the date of grant in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718. For more information on the stock grants awarded to our NEOs in 2023, please see the Fiscal 2023 Grants of Plan-Based Awards table below. (4)The amounts for each NEO consist of payouts under our annual cash performance award program and our SPIP, as set forth below:

  58. FISCAL 2023 SUMMARY COMPENSATION TABLE

    | Name | Year | Annual Cash Performance Award | SPIP Payout | | Mr. Arvan | 2023 | $440,000 | $1,288,760 | | | 2022 | 1,032,355 | 1,120,000 | | | 2021 | 1,050,000 | 1,050,000 | | Mrs. Hart | 2023 | 225,000 | 724,928 | | | 2022 | 387,654 | 600,000 | | | 2021 | 375,000 | 500,000 | | Ms. Neil | 2023 | 162,500 | 523,559 | | | 2022 | 420,654 | 600,000 | | | 2021 | 405,000 | 540,000 | | Mr. St. Romain | 2023 | 148,500 | 724,928 | | | 2022 | 488,861 | 700,000 | | | 2021 | 502,500 | 670,000 |

  59. FISCAL 2023 SUMMARY COMPENSATION TABLE

    (5)For details of All Other Compensation, please see the table below.

  60. FISCAL 2023 SUMMARY COMPENSATION TABLE

    | Name | Year | Company Matching Contributions to Defined Contribution Plans | Vehicle (1) | Other (2) | | Mr. Arvan | 2023 | $41,385 | $17,326 | $15,662 | | | 2022 | 106,346 | 12,908 | 14,925 | | | 2021 | 29,488 | 17,130 | 13,934 | | Mrs. Hart | 2023 | 29,123 | 18,819 | 51,701 | | | 2022 | 22,585 | 15,738 | 20,941 | | | 2021 | 11,600 | 15,975 | 16,682 | | Ms. Neil | 2023 | 53,788 | 8,355 | 14,234 | | | 2022 | 49,754 | 18,003 | 13,590 | | | 2021 | 45,772 | 23,234 | 12,213 | | Mr. St. Romain | 2023 | 65,401 | 22,930 | 20,623 | | | 2022 | 60,877 | 30,575 | 21,485 | | | 2021 | 58,886 | 23,453 | 20,528 | | Mr. Neff | 2023 | 6,539 | — | 43,968 |

  61. FISCAL 2023 SUMMARY COMPENSATION TABLE

    (1)Reflects amounts related to vehicle depreciation, maintenance and insurance expenses for vehicles provided to the NEOs, which may be used for both business and personal purposes. Mr. St. Romain’s 2022 total includes $8,579 related to the sale of his company vehicle. (2)Includes medical, dental, and disability insurance premiums, costs associated with our executive health program and the related tax gross-up amounts. Mrs. Hart’s total includes $34,400 in other compensation related to a discount on pool construction and landscape products purchased from the company in accordance with our employee discount program available to all full-time employees. Mr. Neff’s total includes $28,055 for reimbursement of his relocation costs and $14,756 for the related tax gross-up.

  62. PAY RATIO DISCLOSURE

    PAY RATIO DISCLOSURE The following is a reasonable estimate, prepared under applicable SEC rules, of the ratio of the annual total compensation of our CEO to the median of the annual total compensation of our other employees. We identified our median employee by examining the 2023 total cash compensation for all employees, excluding the CEO, who were employed by us on December 31, 2023. As permitted, we excluded certain non-U.S. employees representing less than 5% of our total employee population of approximately 6,000 at the time. Specifically, we excluded from our employee population all individuals employed in Australia (85), the United Kingdom (31), Mexico (50) and Croatia (14), totaling 180 employees, or 3% of our employee population. After identifying the median employee based on total cash compensation, we calculated the annual total compensation for this employee using the same methodology we use for our NEOs as set forth in the 2023 Summary Compensation Table above. See the table below for the results of our analysis.

  63. PAY RATIO DISCLOSURE

    | Median employee annual total compensation | $51,621 | | Mr. Arvan annual total compensation | $6,103,488 | | Ratio of CEO to median employee compensation | 118:1 |

  64. PAY RATIO DISCLOSURE

    The SEC rules permit companies to choose between different methodologies for median pay calculations. Other public companies may calculate their pay ratio differently than we do, and you should not assume that our pay ratio data is comparable to that of other companies. The Grants of Plan-Based Awards table below sets forth information about the cash plan awards and equity plan awards to our NEOs in 2023.

  65. FISCAL 2023 GRANTS OF PLAN-BASED AWARDS

    FISCAL 2023 GRANTS OF PLAN-BASED AWARDS

  66. FISCAL 2023 GRANTS OF PLAN-BASED AWARDS

    | Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | Grant Date Fair Value of Stock and Option Awards ($) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | Mr. Arvan | 02/22/2023(1) | N/A | N/A | N/A | N/A | 8,388 | N/A | 3,000,304 | | | 02/22/2023(2) | N/A | N/A | N/A | 699 | 1,398 | 2,796 | 500,051 | | | 02/22/2023(3) | N/A | 800,000 | 1,600,000 | N/A | N/A | N/A | N/A | | Mrs. Hart | 02/22/2023(1) | N/A | N/A | N/A | N/A | 2,098 | N/A | 750,434 | | | 02/22/2023(2) | N/A | N/A | N/A | 350 | 700 | 1,400 | 250,383 | | | 02/22/2023(3) | N/A | 337,500 | 675,000 | N/A | N/A | N/A | N/A | | Ms. Neil | 02/22/2023(1) | N/A | N/A | N/A | N/A | 1,322 | N/A | 472,866 | | | 02/22/2023(2) | N/A | N/A | N/A | 74 | 148 | 296 | 52,938 | | | 02/22/2023(3) | N/A | 243,750 | 487,500 | N/A | N/A | N/A | N/A | | Mr. St. Romain | 02/22/2023(1) | N/A | N/A | N/A | N/A | 2,518 | N/A | 900,663 | | | 02/22/2023(2) | N/A | N/A | N/A | 420 | 840 | 1,680 | 300,460 | | | 02/22/2023(3) | N/A | 450,000 | 900,000 | N/A | N/A | N/A | N/A | | Mr. Neff | 07/25/2023(1) | N/A | N/A | N/A | N/A | 926 | N/A | 350,445 | | | 07/17/2023(4) | N/A | N/A | 291,678 | N/A | N/A | N/A | N/A |

  67. FISCAL 2023 GRANTS OF PLAN-BASED AWARDS

    (1)Reflects performance-based restricted stock awards granted under our 2007 LTIP (PS-1 awards). These awards cliff vest 50% after three years and 50% after five years, in all cases subject to the achievement of applicable performance criteria. See Compensation Discussion and Analysis “Long-Term Equity Award” for a discussion of the criteria. (2)Reflects performance-based restricted stock awards granted under our 2007 LTIP (PS-2 awards). These awards cliff vest three years after the grant date, subject to the achievement of applicable performance criteria. See Compensation Discussion and Analysis “Long-Term Equity Award” for a discussion of the criteria. (3)Reflects grants under our annual cash bonus program. See Compensation Discussion and Analysis, “Annual Incentive Plan.” The target and maximum amounts included in this table reflect the potential payments based on 2023 performance; the actual annual performance award payment amounts for 2023 are included in the “Non-Equity Incentive Plan Compensation” column in the Summary Compensation Table. The target payouts in this table reflect 100% of the 2023 base salary amount for Mr. Arvan and Mr. St. Romain and 75% of the 2023 base salary amounts for the other NEOs. The maximum potential payouts are 200% of target for each of the NEOs. (4)Reflects a grant under our annual cash bonus program. See Compensation Discussion and Analysis, “Annual Incentive Plan.” Under the terms of Mr. Neff’s offer letter, he was guaranteed a minimum bonus of $250,000 but could receive more based on the achievement of the applicable performance metrics under the plan, up to the maximum amount reflected in the table, which has been pro-rated based on Mr. Neff’s start date. The actual annual performance award payment amount for 2023 is included in the “Bonus” column in the Summary Compensation Table.

  68. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

    OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

  69. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

    | | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($/Sh) | Option Expiration Date | Number of Shares or Units of Stock that Have Not Vested (#) | Market Value of Shares or Units that Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Mr. Arvan | 02/27/19 | N/A | N/A | N/A | N/A | N/A | N/A | 13,000(1) | 5,183,230(9) | | | 02/26/20 | N/A | N/A | N/A | N/A | N/A | N/A | 11,280(2) | 4,497,449(9) | | | 02/24/21 | N/A | N/A | N/A | N/A | N/A | N/A | 8,800(3) | 3,508,648(9) | | | 02/23/22 | N/A | N/A | N/A | N/A | N/A | N/A | 7,222(4) | 2,879,484(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 8,388(5) | 3,344,379(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 1,398(6) | 557,397(9) | | Mrs. Hart | 02/27/14 | 2,500 | — | 58.26 | 02/27/24 | N/A | N/A | N/A | N/A | | | 02/26/15 | 1,250 | — | 69.85 | 02/26/25 | N/A | N/A | N/A | N/A | | | 02/25/16 | 2,750 | — | 80.78 | 02/25/26 | N/A | N/A | N/A | N/A | | | 03/01/17 | 2,750 | — | 117.04 | 03/01/27 | N/A | N/A | N/A | N/A | | | 02/28/18 | 2,500 | — | 138.03 | 02/28/28 | N/A | N/A | N/A | N/A | | | 02/27/19 | N/A | N/A | N/A | N/A | N/A | N/A | 860(1) | 342,891(9) | | | 02/26/20 | N/A | N/A | N/A | N/A | N/A | N/A | 798(2) | 318,171(9) | | | 02/24/21 | N/A | N/A | N/A | N/A | N/A | N/A | 1,572(7) | 626,772(9) | | | 02/23/22 | N/A | N/A | N/A | N/A | N/A | N/A | 1,444(4) | 575,737(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 2,098(5) | 836,494(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 700(6) | 279,097(9) | | Ms. Neil | 02/27/19 | N/A | N/A | N/A | N/A | N/A | N/A | 1,210(1) | 482,439(9) | | | 02/26/20 | N/A | N/A | N/A | N/A | N/A | N/A | 1,085(2) | 432,600(9) | | | 02/24/21 | N/A | N/A | N/A | N/A | N/A | N/A | 1,414(7) | 563,776(9) | | | 02/23/22 | N/A | N/A | N/A | N/A | N/A | N/A | 1,204(4) | 480,047(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 1,322(5) | 527,095(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 148(6) | 59,009(9) | | Mr. St. Romain | 02/27/19 | N/A | N/A | N/A | N/A | N/A | N/A | 2,570(1) | 1,024,685(9) | | | 02/26/20 | N/A | N/A | N/A | N/A | N/A | N/A | 2,153(2) | 858,423(9) | | | 02/24/21 | N/A | N/A | N/A | N/A | N/A | N/A | 2,672(7) | 1,065,353(9) | | | 02/23/22 | N/A | N/A | N/A | N/A | N/A | N/A | 2,166(4) | 863,606(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 2,518(5) | 1,003,952(9) | | | 02/22/23 | N/A | N/A | N/A | N/A | N/A | N/A | 840(6) | 334,916(9) | | Mr. Neff | 07/25/23 | N/A | N/A | N/A | N/A | N/A | N/A | 926(8) | 369,205(9) |

  70. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

    (1)These shares vested on February 27, 2024. (2)These shares will vest on February 26, 2025 if the performance-based vesting criteria is met. (3)These shares will vest on February 24, 2026 if the performance-based vesting criteria is met. (4)These shares will vest 50% on February 23, 2025 and 50% on February 23, 2027 if the performance-based vesting criteria is met. (5)These shares will vest on 50% on February 22, 2026 and 50% on February 22, 2028 if the performance-based vesting criteria is met. (6)These shares will vest on February 22, 2026 to the extent the performance-based vesting criteria is met. The target award values are specified above and attainment can vary from 0% to 200%. (7)These shares vested 50% on February 24, 2024 and 50% will vest on February 24, 2026 if the performance-based vesting criteria is met. (8)These shares will vest on 50% on July 25, 2026 and 50% on July 25, 2028 if the performance-based vesting criteria is met. (9)Based on the market value of $398.71 per share of our Common Stock on December 29, 2023. The table below summarizes the number of shares acquired and the dollar amounts realized by NEOs from the exercise of stock options and the vesting of restricted stock in 2023.

  71. OPTION EXERCISES AND STOCK AWARDS VESTED

    OPTION EXERCISES AND STOCK AWARDS VESTED

  72. OPTION EXERCISES AND STOCK AWARDS VESTED

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired Upon Exercise (#) | Value Realized Upon Exercise ($) | Number of Shares Acquired Upon Vesting (#) | Value Realized Upon Vesting ($) | | Peter Arvan | — | $— | 11,000 | $3,925,460 | | Melanie Hart | — | — | 1,297 | 462,409 | | Jennifer Neil | — | — | 2,445 | 871,926 | | Kenneth St. Romain | — | — | 5,152 | 1,837,359 | | Kristopher Neff | — | — | — | — |

  73. NONQUALIFIED DEFERRED COMPENSATION

    NONQUALIFIED DEFERRED COMPENSATION Under our Deferred Compensation Plan, certain executives, including our NEOs, may elect to defer all or a portion of their base salary and annual non-equity incentive compensation. Participants choose to invest their deferrals in one or more specified investment funds. Participants may change their fund selections at any time, subject to certain limitations. The table below shows the funds available and their annual rates of return for the calendar year ended December 31, 2023 as reported by T. Rowe Price. Earnings are determined by the results of the individual investments.

  74. NONQUALIFIED DEFERRED COMPENSATION

    | Name of Fund | Rate of Return | Name of Fund | Rate of Return | | Artisan International Fund | 8.00% | TRP Retirement 2015 Fund | 6.18% | | Goldman Sachs Small Cap Value Fund | 8.82% | TRP Retirement 2020 Fund | 7.87% | | Delaware Value Fund | 7.57% | TRP Retirement 2025 Fund | 6.99% | | TRP Growth Stock Fund | 10.98% | TRP Retirement 2030 Fund | 8.76% | | TRP Mid-Cap Growth Fund | 12.96% | TRP Retirement 2035 Fund | 7.63% | | TRP Government Money Fund | 4.42% | TRP Retirement 2040 Fund | 9.26% | | Vanguard 500 Index Fund | 7.62% | TRP Retirement 2045 Fund | 8.08% | | TRP Small Cap Stock Fund | 12.69% | TRP Retirement 2050 Fund | 7.35% | | JP Morgan Mid-Cap Value | 11.48% | TRP Retirement 2055 Fund | 7.33% | | Dodge & Cox Income Fund | 6.00% | TRP Retirement 2060 Fund | 7.99% | | TRP Retirement 2005 Fund | 5.44% | TRP Retirement 2065 Fund | 7.97% | | TRP Retirement 2010 Fund | 6.86% | TRP Value Fund | 10.68% |

  75. NONQUALIFIED DEFERRED COMPENSATION

    Benefits under our Deferred Compensation Plan will be paid to our NEOs as each executive elects, but no earlier than one full year after the end of the plan year for which compensation is deferred or six months after termination of employment. However, upon a showing of financial hardship and certain other requirements, an NEO may be allowed to access funds in his or her deferred compensation account earlier than the beginning of the year following the executive’s retirement or termination. In the event of a change of control, all vested accrued benefits will automatically be accelerated and payable in full. The time and schedule of payments may also be accelerated if the participant becomes disabled, to fulfill a qualified domestic relations order, if the amount is less than $10,000 or to pay employment taxes. Benefits can be received either as a lump sum payment or in installments. The following table summarizes the contributions and earnings for our NEOs in 2023 under our Deferred Compensation Plan.

  76. NONQUALIFIED DEFERRED COMPENSATION

    | Name | Executive Contributions in Last FY | Company Contributions in Last FY (1) | Aggregate Gains in Last FY | Aggregate Withdrawals/ Distributions | Aggregate Balance at Last FYE | | Peter Arvan | $197,692 | $28,185 | $203,264 | $— | $2,044,490(2) | | Melanie Hart | 22,212 | 15,923 | 7,944 | — | 70,438(3) | | Jennifer Neil | 134,469 | 40,588 | 153,110 | (136,915) | 1,021,259(4) | | Kenneth St. Romain | 130,801 | 52,201 | 112,038 | — | 1,846,768(5) | | Kristopher Neff | 32,692 | 6,539 | 3,047 | — | 42,278 |

  77. NONQUALIFIED DEFERRED COMPENSATION

    (1)These amounts are included in the Summary Compensation Table within All Other Compensation. (2)Includes Company contributions of $94,146 in 2022 and $17,888 in 2021 disclosed in the Summary Compensation Table (All Other Compensation). (3)Includes Company contributions of $10,385 in 2022 disclosed in the Summary Compensation Table (All Other Compensation). (4)Includes Company contributions of $37,554 in 2022 and $34,172 in 2021 disclosed in the Summary Compensation Table (All Other Compensation). (5)Includes Company contributions of $48,677 in 2022 and $47,286 in 2021 disclosed in the Summary Compensation Table (All Other Compensation).

  78. POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT OR CHANGE OF CONTROL

    POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT OR CHANGE OF CONTROL

  79. Effect on Outstanding Equity Awards of Termination of Employment or Change of Control

    Effect on Outstanding Equity Awards of Termination of Employment or Change of Control Our equity awards are subject to “double trigger” accelerated vesting upon a change of control, which is explained in more detail below. Stock options granted to NEOs, subject to certain limitations, will: ▪immediately vest and become fully exercisable upon an executive’s death or disability; ▪immediately vest and become fully exercisable if the executive experiences a qualifying termination within two years after a change of control; a qualifying termination includes a termination by the Company without cause or a termination by the executive for good reason (which is defined as a diminution of the executive’s compensation or responsibilities, or a relocation of more than 50 miles); ▪remain exercisable and continue to vest in accordance with the original vesting schedule upon retirement (which is defined as attainment of the age of 55 years or more and continuous service to us for a period of at least ten years), provided the recipient complies with certain restrictive covenants; ▪be forfeited, whether or not then exercisable, upon termination for cause; and ▪remain exercisable for the shorter of 90 days or the remaining term upon a termination without cause, unless the Compensation Committee, in its discretion, allows the options to continue to vest in accordance with their original schedule and maintain their original termination date. Shares of restricted stock, including performance-based restricted stock, granted to NEOs, subject to certain limitations, will: ▪fully vest upon an executive’s death or disability; ▪fully vest, with any applicable performance conditions waived, if the executive experiences a qualifying termination (as described above) within two years after a change of control; ▪continue to vest in accordance with the original vesting schedule upon retirement, provided the recipient complies with certain restrictive covenants; and ▪be forfeited upon any other termination of employment, whether voluntary or involuntary, unless the Compensation Committee, in its discretion, provides otherwise. Under the agreements, “cause” is generally defined as the recipient’s (i) conviction of a felony or any crime or offense lesser than a felony involving the property of the Company; (ii) conduct that has caused demonstrable and serious injury to the Company, monetary or otherwise; (iii) willful refusal to perform or substantial disregard of duties properly assigned; or (iv) breach of duty of loyalty to the Company or other act of fraud or dishonesty with respect to the Company. Assuming the executive’s termination of employment due to death or disability or a change of control and a qualifying termination occurred on December 31, 2023, the following table sets forth the value of all unvested shares of restricted stock held by the NEOs at December 31, 2023 that would immediately vest upon such event.

  80. Effect on Outstanding Equity Awards of Termination of Employment or Change of Control

    | | Number of Shares Unvested Awards | | Value as of December 31, 2023 of Unvested Awards | | | | Name | Option Awards | Stock Awards | Option Awards | Stock Awards (1) | Total Awards | | Peter Arvan | — | 51,486 | $— | $20,527,983 | $20,527,983 | | Melanie Hart | — | 8,172 | — | 3,258,258 | 3,258,258 | | Jennifer Neil | — | 6,531 | — | 2,603,975 | 2,603,975 | | Kenneth St. Romain | — | 13,759 | — | 5,485,851 | 5,485,851 | | Kristopher Neff | — | 926 | — | 369,205 | 369,205 |

  81. Effect on Outstanding Equity Awards of Termination of Employment or Change of Control

    (1)We calculated by multiplying the number of shares of unvested restricted stock by the closing price of our Common Stock as of December 29, 2023.

  82. Severance Payments upon Termination without Cause

    Severance Payments upon Termination without Cause Upon termination other than for cause, Mr. Arvan is entitled to receive his base salary for a period of twelve months after termination, and the other remaining NEOs are entitled to receive their respective base salaries for a period of six months. In addition, the NEOs would also be entitled to receive reimbursement of health insurance premiums for a period of six months. Receipt of these benefits, approximating $2,500 for each NEO, is conditioned upon the executive’s execution and non-revocation of a general release of claims and his or her continued compliance with any applicable post-termination obligations. The table below presents the cash severance that would be payable upon termination without cause to each NEO serving as of December 31, 2023.

  83. Severance Payments upon Termination without Cause

    | Name | Cash Severance Payment upon Termination Without Cause | | Peter Arvan | 800,000 | | Melanie Hart | 225,000 | | Jennifer Neil | 162,500 | | Kenneth St. Romain | 225,000 | | Kristopher Neff | 212,500 |

  84. Severance Payments upon Termination without Cause

    The NEOs are not entitled to any additional compensation, perquisites or other personal benefits upon a change of control, retirement or termination, except for future payments under our 401(k) Plan and Deferred Compensation Plan.

  85. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K, the tables below provide information regarding the relationship between executive compensation and our financial performance for each of the last four completed fiscal years. In determining the “compensation actually paid” to our NEOs, we are required to make various adjustments to amounts that we reported in the Summary Compensation Table, as the SEC’s valuation methods for this section differ from those required in the Summary Compensation Table. “Compensation actually paid” does not reflect value actually realized by our NEOs during the year or how the Compensation Committee evaluates compensation decisions in light of company or individual performance. Rather, “compensation actually paid” is an amount calculated under SEC rules and includes, among other things, year-over-year changes in the value of unvested equity awards. The table below summarizes compensation values both previously reported in our Summary Compensation Table, as well as the adjusted values required in this section for the 2023, 2022, 2021 and 2020 fiscal years. Note that for our NEOs other than our principal executive officer (the PEO), compensation is reported as an average.

  86. Pay versus Performance Table

    Pay versus Performance Table

  87. Pay versus Performance Table

    | | | | | | Value of Initial $100 investment based on: | | | | | Year | Summary Compensation Table (SCT) Total for PEO | Compensation Actually Paid (CAP) to PEO(1) | Average SCT Total for Non-PEO NEOs(2) | Average CAP to Non-PEO NEOs | POOL Total Shareholder Return (TSR) | S&P 500 Index TSR | Net Income (GAAP) Reported | Adjusted Diluted Earnings per Share(3) | | 2023 | $6,103,488 | $10,653,040 | $1,911,059 | $2,453,933 | $195.05 | $157.60 | $523,229 | $13.18 | | 2022 | 5,846,697 | (6,623,441) | 1,818,217 | (865,205) | 146.09 | 124.79 | 748,462 | 18.43 | | 2021 | 5,575,384 | 17,440,932 | 1,982,103 | 4,184,316 | 270.70 | 152.39 | 650,624 | 15.18 | | 2020 | 5,057,337 | 13,029,242 | 2,283,466 | 5,607,994 | 176.95 | 118.40 | 366,738 | 8.42 |

  88. Pay versus Performance Table

    (1) For each fiscal year included in the table, Peter D. Arvan served as our PEO. The following table details the amounts we deducted or added to Mr. Arvan’s total compensation as reflected in the Summary Compensation Table to arrive at compensation actually paid referenced in this table.

  89. Pay versus Performance Table

    | Year | (SCT) Total for PEO | Less: Reported Value of Equity Awards | Fair Value (FV) at 12/31 of Unvested Equity Awards Granted During the Year(4) | Year-Over-Year Change in FV of Equity Awards Granted in Prior Years that Vested in Year(4) | Year-Over-Year Change in FV of Unvested Equity Awards Granted in Prior Years(4) | Dividends Paid on Unvested Awards | CAP to PEO | | 2023 | $6,103,488 | $(3,500,354) | $3,344,379 | $599,830 | $3,884,307 | $221,390 | $10,653,040 | | 2022 | 5,846,697 | (3,000,163) | 2,183,427 | (225,776) | (11,622,574) | 194,948 | (6,623,441) | | 2021 | 5,575,384 | (2,889,832) | 4,980,800 | — | 9,600,503 | 174,077 | 17,440,932 | | 2020 | 5,057,337 | (2,481,713) | 4,201,800 | — | 6,138,200 | 113,618 | 13,029,242 |

  90. Pay versus Performance Table

    (2) The following table details the average amounts we deducted or added to the non-PEO NEOs’ average total compensation as reflected in the Summary Compensation Table to arrive at the average compensation actually paid referenced in this table. The non-PEO NEOs for each year reported are as follows: •2023: Melanie Hart, Jennifer Neil, Kenneth St. Romain and Kristopher Neff •2022: Melanie Hart, Jennifer Neil, Kenneth St. Romain and Jeffrey Clay •2021: Melanie Hart, Jennifer Neil, Kenneth St. Romain, Jeffrey Clay and Mark Joslin •2020: Mark Joslin, A. David Cook, Jennifer Neil and Kenneth St. Romain

  91. Pay versus Performance Table

    | Year | Average SCT Total for Non-PEO NEOs | Less: Average Reported Value of Equity Awards | Average FV at 12/31 of Unvested Equity Awards Granted During the Year(4) | Year-Over-Year Average Change in FV of Equity Awards Granted in Prior Years that Vested in Year(4) | Year-Over-Year Average Change in FV of Unvested Equity Awards Granted in Prior Years(4) | Average FV of Forfeited Equity Awards Granted in Prior Years(4) | Average Dividends Paid on Unvested Awards | | Average CAP to Non-PEO NEOs | | 2023 | $1,911,059 | $(769,547) | $684,186 | $135,758 | $461,371 | $— | $31,106 | | $2,453,933 | | 2022 | 1,818,217 | (625,000) | 363,854 | (317,677) | (1,593,663) | (541,096) | 30,160 | — | (865,205) | | 2021 | 1,982,103 | (637,865) | 1,099,398 | (190,342) | 1,897,400 | — | 33,622 | | 4,184,316 | | 2020 | 2,283,466 | (823,113) | 1,393,616 | 28,745 | 2,678,407 | — | 46,873 | | 5,607,994 |

  92. Pay versus Performance Table

    (3) The table below reconciles diluted earnings per share to adjusted diluted earnings per share for each of the years presented.

  93. Pay versus Performance Table

    | | Year Ended December 31, | | | | | | 2023 | 2022 | 2021 | 2020 | | Diluted EPS | $13.35 | $18.70 | $15.97 | $8.97 | | ASU 2016-09 tax benefit | (0.17) | (0.27) | (0.74) | (0.70) | | Adjusted diluted EPS without ASU 2016-09 tax benefit | 13.18 | 18.43 | 15.23 | 8.27 | | After-tax (recovery) impairment charges | — | — | (0.05) | 0.15 | | Adjusted diluted EPS without ASU 2016-19 tax benefit and after-tax (recovery) impairment charges | $13.18 | $18.43 | $15.18 | $8.42 |

  94. Pay versus Performance Table

    (4) In determining the fair value of unvested equity awards, for our PS-1 awards we applied the same methodology used to determine grant date fair value of equity awards for purposes of SCT reporting but calculated as of the last day of the year or applicable vesting date, with no material changes to the underlying assumptions for any of the awards since grant date. For the PS-2 awards granted in February 2023, as of December 31, 2023, we do not expect these awards to vest and, accordingly, assigned a value of zero to those awards.

  95. Relationship between Compensation Actually Paid and Performance

    Relationship between Compensation Actually Paid and Performance The graphs below show the relationship of “compensation actually paid” to our PEO and other NEOs to (i) TSR of both our company and the S&P 500 Index, (ii) our net income and (iii) our adjusted diluted EPS.

  96. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The many responsibilities and risks of serving as a director of a public company require that we provide adequate compensation in order to attract and retain highly qualified and productive directors. Our directors play an important role in guiding our strategic direction and overseeing our management. We intend to compensate our non-executive directors at a level that approximates median market practice. The Compensation Committee regularly reviews the components and amounts of non-employee director compensation, periodically retaining an independent compensation consultant to assist with its review. In benchmarking director pay, the Compensation Committee uses the same group of companies used to benchmark executive compensation, as described earlier in the “Compensation Discussion and Analysis” section of this proxy statement. In May 2023, following their review of non-executive director compensation compared to the peer group, which included a review by Pearl Meyer in the fall of 2022, the Compensation Committee updated the program to more closely align our director compensation with peer group practices. The following changes went into effect following the 2023 Annual Meeting: •the annual cash retainer for our non-employee directors increased from $75,000 to $85,000; •the additional annual cash retainer paid to our chairman increased from $80,000 to $135,000; •the annual Audit Committee chair fee increased from $20,000 to $25,000; •the annual Audit Committee member fee increased from $10,000 to $10,500; and •the annual Compensation Committee chair increased from $15,000 to $20,000. The table below outlines the current annual compensation program for our non-employee directors.

  97. DIRECTOR COMPENSATION

    | Compensation Element | Amount | | Non-employee director cash retainer | $85,000 | | Additional chairman cash retainer | 135,000 | | Audit Committee chair | 25,000 | | Compensation Committee chair | 20,000 | | Nominating and Corporate Governance chair | 15,000 | | Strategic Planning chair | 15,000 | | Audit Committee member | 10,500 | | Compensation Committee member | 10,500 | | Nominating and Corporate Governance member | 7,500 | | Strategic Planning member | 7,500 | | Director equity grant | 125,000 |

  98. DIRECTOR COMPENSATION

    Our directors do not receive separate per meeting fees for attending Board or committee meetings, but we do reimburse them for reasonable out-of-pocket expenses they incur to attend Board and committee meetings and director education programs. All non-employee directors receive an annual equity award valued at $125,000 and may also elect to receive equity grants in lieu of their cash compensation. In 2023, each director was permitted to elect to receive his or her annual equity compensation in the form of (i) 925 stock options with an exercise price equal to our Common Stock’s closing price on the grant date; or (ii) 356 shares of restricted stock. The annual equity awards are granted on the date of the annual meeting of stockholders and, except under certain limited circumstances, the stock options and restricted stock vest no earlier than one year after the grant date, and any options granted are exercisable for up to ten years after the grant date. All of our directors elected to receive his or her 2023 equity compensation in the form of restricted stock awards, except Mr. Perez de la Mesa who chose to receive his 2023 equity compensation in the form of stock options. The table below summarizes the compensation we paid to our non-executive directors during the year ended December 31, 2023.

  99. DIRECTOR COMPENSATION

    | Director | Fees Earned or Paid in Cash | Stock Awards (1) | Option Awards (1) | Total | | Martha Gervasi | $106,000 | $125,212 | $— | $231,212 | | Timothy Graven (2) | 34,167 | — | — | 34,167 | | James Hope | 106,667 | 125,212 | — | 231,879 | | Debra Oler | 104,667 | 125,212 | — | 229,879 | | Manuel Perez de la Mesa | 81,667 | — | 125,125 | 206,792 | | Carlos Sabater | 100,500 | 125,212 | — | 225,712 | | Harlan Seymour (2) | 65,625 | — | — | 65,625 | | Robert Sledd | 102,500 | 125,212 | — | 227,712 | | John Stokely | 206,667 | 125,212 | — | 331,879 | | David Whalen | 116,667 | 125,212 | — | 241,879 |

  100. DIRECTOR COMPENSATION

    (1)Amounts shown do not reflect compensation actually received by the directors. Instead, these amounts reflect the estimated fair value of the awards on the grant date. (2)Mr. Graven and Mr. Seymour retired effective May 2023 immediately following the annual meeting. As of December 31, 2023, stock awards and stock options outstanding for each non-executive director included the following:

  101. DIRECTOR COMPENSATION

    | Director | Stock Awards Outstanding | Options Outstanding | Options Exercisable | | Ms. Gervasi | 356 | — | — | | Mr. Hope | 356 | — | — | | Mrs. Oler | 356 | — | — | | Mr. Perez de la Mesa | — | 147,349 | 146,424 | | Mr. Sabater | 356 | — | — | | Mr. Sledd | 356 | 1,654 | 1,654 | | Mr. Stokely | 356 | — | — | | Mr. Whalen | 356 | — | — |