DEF 14A of Generac Holdings Inc.
Filed Apr 29, 2025 · FY20240001104659-25-040848
Key Components and Design of the Executive Compensation Program
Key Components and Design of the Executive Compensation Program * A full discussion of our use of non-U.S. generally accepted accounting principles measures to provide a baseline for evaluating and comparing our operating results, and a reconciliation of Adjusted EBITDA to net income can be found in Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Key Components and Design of the Executive Compensation Program
| | 3 | 2025 Proxy Statement |
Key Components and Design of the Executive Compensation Program
| The nominees for election as Class I Directors at the 2025 annual meeting are described below, each of whom has been nominated by the Board of Directors. If elected, each of the nominees is expected to serve for a three-year term expiring at the annual meeting of stockholders of the Company in 2028 and until their respective successors have been elected and qualified. The Board of Directors recommends a vote FOR the Company’s nominees for Class I Directors. |
Key Components and Design of the Executive Compensation Program
Our Board of Directors is divided into three classes, with each class serving a consecutive three-year term. The term of the current Class I Directors will expire on the date of the 2025 annual meeting, subject to the election and qualification of their respective successors. The Board of Directors expects that each of the nominees will be available for election as a director. However, if by reason of an unexpected occurrence, one or more of the nominees is not available for election, the persons named in the form of proxy have advised that they will vote for such substitute nominees as the Board of Directors may nominate. Mr. John D. Bowlin, a Class I Director, has elected to retire from the Board of Directors at the end of his current term and is not standing for re-election at the 2025 annual meeting. Our Company and the Board would like to thank Mr. Bowlin, who has served as a director since 2006, for his service, guidance, and many contributions to our company, particularly during a very transformative time in our history. In selecting director candidates, the Nominating and Corporate Governance Committee considers whether the candidates possess the required skill sets and fulfill the qualification requirements of directors approved by the Board of Directors, including integrity, objectivity, sound judgment, leadership, courage, and diversity in all aspects of that term. The following table provides the current composition of each of our committees:
Key Components and Design of the Executive Compensation Program
| Director | Audit Committee | Human Capital and Compensation Committee | Nominating and Corporate Governance Committee | | Marcia Avedon | | C | X | | Kathryn Bohl | X | | X | | John Bowlin(1) | | X | | | Robert Dixon | X | | C | | William Jenkins | | X | | | Andrew Lampereur | C | | | | Bennett Morgan (L) | | X | X | | Nam Nguyen(2) | | | X | | David Ramon | X | | X | | Dominick Zarcone | X | X | |
Key Components and Design of the Executive Compensation Program
“C” = Chairperson “L” = Lead Director (1) until the annual meeting as Mr. Bowlin is not standing for re-election. Ms. Nguyen has been appointed a member of the Human Capital and Compensation Committee effective upon her re-election at the annual meeting.
Key Components and Design of the Executive Compensation Program
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Key Components and Design of the Executive Compensation Program
Our director nominees and continuing directors bring a broad range of skills, experiences, and perspectives to our board. The table below summarizes the skills and experiences that bring value to our Company. As discussed in his biography below, Mr. Zarcone is also a director nominee for WillScot Holdings Corporation, a public company listed on the NASDAQ exchange.
Key Components and Design of the Executive Compensation Program
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Key Components and Design of the Executive Compensation Program
The following biographies describe the business experience of each director nominee and continuing director. Following the biographical information for each director below, we have listed qualifications that, in addition to those discussed above, the Board of Directors considered in determining whether to recommend the director be nominated for reelection.
Nominees for Election
Nominees for Election
Class I Directors
Class I Directors
Class I Directors
| AARON P. JAGDFELD | | | Age: 53 Director Since: 2006 Chairman Since: 2016 | EXPERIENCE & QUALIFICATIONS • 2008-Current: President and Chief Executive Officer of Generac • 2007: President of Generac, responsible for sales, marketing, engineering, and product development • 2002-2006: Chief Financial Officer, Generac • 1994-2001: Finance Department, Generac • Prior to 1994: Audit Practice, Deloitte & Touche, LLP Other Board Service • Current Director of The Hillman Group, a public company providing complete hardware solutions As the Chief Executive Officer and the only management representative on the Board, Mr. Jagdfeld provides valuable insight to the Board regarding the day-to-day business issues facing the Company. Since joining the Company, he has navigated a number of achievements, including our initial public offering, the significant increase in sales, numerous acquisitions, and our international expansion. Mr. Jagdfeld has extensive finance and operational experience and has high-level leadership experience in several prior positions. Mr. Jagdfeld holds a Bachelor of Business Administration in Accounting from the University of Wisconsin-Whitewater. |
Class I Directors
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Class I Directors
| ANDREW G. LAMPEREUR | | | Age: 62 Director Since: 2014 | EXPERIENCE & QUALIFICATIONS • 2000-2017: Executive Vice President and Chief Financial Officer, Actuant Corporation (now Enerpac Tool Group Corporation), a global diversified company that designs and manufactures industrial products and systems (“Actuant”) • 1999-2000: Applied Power (Actuant) Business Development Leader • 1998-1999: Vice President and General Manager — Distribution, Gardner Bender (Actuant subsidiary) • 1996-1998: Vice President Finance, Gardner Bender • 1993-1996: Corporate Controller, Actuant Corporation • Prior to 1993: Held various financial positions with Fruehauf Trailer Corporation, Terex Corporation, and Price Waterhouse Other Board Service • Former Director of Jason Industries, Inc. • Former Director of Robbins & Myers Mr. Lampereur brings extensive financial experience to Generac. Mr. Lampereur has over 26 years of senior-level financial experience in a variety of businesses complementary to Generac, including as a chief financial officer and director of a public company. Mr. Lampereur graduated with a Bachelor of Business Administration in Accounting from St. Norbert College. |
Class I Directors
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Class I Directors
| NAM T. NGUYEN | | | Age: 49 Director Since: 2022 | EXPERIENCE & QUALIFICATIONS • 2020-Current: Chief Operating Officer, Generate Capital, a leading sustainable infrastructure company • 2013-2020: Executive Vice President, SunPower Corp., a solar power products company • Prior to 2013: Vice President of Global Business Development at First Solar and held various positions in investment banking, working in New York, Singapore and Los Angeles Ms. Nguyen brings to Generac over 20 years of experience as an executive leader in renewable energy and sustainable infrastructure. Ms. Nguyen specializes in P&L management, international market expansion, business development, sales strategy and operations, and financing. Working in the domestic and international solar sector, Ms. Nguyen has led startup and expansion projects, specifically driving revenue and scaling businesses in new markets. Ms. Nguyen’s background with solar power and renewable energy markets provides Generac with valuable expertise and strategic insight within key areas of Generac’s business. Ms. Nguyen also brings significant international experience, having worked in Latin America and Singapore. Ms. Nguyen graduated with a Bachelor of Arts in Economics from Columbia University and a Master of Business Administration from Harvard University. |
Class I Directors
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Other Members of the Board of Directors
Other Members of the Board of Directors Including the nominees, the Board of Directors currently consists of eleven directors, each of whom, other than the nominees, is described below, except for Mr. Bowlin, a current Class I Director, who is retiring effective as of the annual meeting and is not standing for re-election. The terms of the Class II Directors expire at the 2026 annual meeting of Stockholders, subject to the election and qualification of their respective successors. The terms of the Class III Directors expire at the 2027 Annual Meeting of Stockholders, subject to the election and qualification of their respective successors.
Class II Directors
Class II Directors
Class II Directors
| MARCIA J. AVEDON, PH.D. | | | Age: 63 Director Since: 2019 | EXPERIENCE & QUALIFICATIONS • 2022-Current: Founder and CEO, Avedon Advisory, LLC • 2020-2022: Executive Vice President, Chief Human Resources, Marketing, & Communications Officer for Trane Technologies, a climate control innovation company focusing on heating and cooling in buildings, homes, and transportation (previously Ingersoll-Rand, plc) • 2007-2020: Senior Vice President of Human Resources, Communications, and Corporate Affairs for Ingersoll-Rand, plc, leading global human resources, public affairs, corporate social responsibility, communications, and strategic marketing • 2002-2006: Chief Human Resources Officer at Merck, a global pharmaceutical company • 1995-2002: Held increasingly responsible leadership positions in Human Resources and Communications for Honeywell International, a global diversified company • Prior to 1995: Held positions in Human Resources at Anheuser-Busch Companies and as a consultant with Booz, Allen & Hamilton Other Board Service • Current Director of Acuity Brands, Inc., a publicly traded industrial technology company • Current Director of Cornerstone Building Brands, a private manufacturer of exterior building products • Former Director of GCP Applied Technologies • Former Director of Lincoln National Corporation Ms. Avedon brings to Generac extensive expertise on global human resources and human capital topics. Ms. Avedon has over 30 years of experience leading organizational transformation, talent and succession management, culture change, corporate social responsibility, and communications. Ms. Avedon earned a Bachelor of Arts in Psychology from the University of North Carolina at Wilmington, and a Master’s Degree and Ph.D. in Industrial and Organizational Psychology from George Washington University. |
Class II Directors
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Class II Directors
| BENNETT J. MORGAN | | | Age: 61 Director Since: 2013 | EXPERIENCE & QUALIFICATIONS • 2005-2016: President and Chief Operating Officer, Polaris Industries Inc., a manufacturer of power sports vehicles (“Polaris”) • 2004-2005: Vice President and General Manager, ATV Division, Polaris • 2001-2004: General Manager, ATV Division, Polaris • 1997-2001: General Manager, PGA Division, Polaris • 1987-1997: Held various marketing, product development, and operations positions at Polaris Industries Mr. Morgan brings to Generac extensive leadership skills. Having served in senior roles as President and Chief Operating Officer for a public company, Mr. Morgan has over 25 years of expertise in international consumer durables products, dealer distribution, product development, and innovation. Serving in these leadership roles provides Mr. Morgan with in-depth knowledge of strategic growth and development and company oversight, including talent development, product development, sales and marketing, engineering, and manufacturing operations. Mr. Morgan earned his Bachelor of Science in Economics from St. John’s University and Master of Business Administration from the Carlson School of Management at the University of Minnesota. |
Class II Directors
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Class II Directors
| DOMINICK P. ZARCONE | | | Age: 66 Director Since: 2017 | EXPERIENCE & QUALIFICATIONS • 2017-2024: President and Chief Executive Officer of LKQ Corporation, a global distributor of vehicle parts and accessories • 2015-2017: Chief Financial Officer, LKQ Corporation • 2011-2015: Managing Director and Chief Financial Officer of Baird Financial Group, a capital markets and wealth management company, and certain of its affiliates • 2011-2015: Treasurer of Baird Funds, Inc., a family of fixed income and equity mutual funds managed by Robert W. Baird & Co. Incorporated, a registered broker/dealer • 1995-2011: Managing Director of the Investment Banking department of Robert W. Baird & Co. Incorporated • 1986-1995: Held various positions with investment banking company Kidder, Peabody & Co., Incorporated, most recently as Senior Vice President of Investment Banking Other Board Service • Current Director of LKQ Corporation1 • Current Board Chair of MEKO Group AB (Stockholm), a publicly traded leading distributor of automotive parts and accessories in Europe • Director Nominee at WillScot Holdings Corporation, a public company and leading name in mobile storage solutions and modular buildings, and will be a Director upon his election on June 6, 2025. Mr. Zarcone brings to Generac extensive management and leadership experience, serving in senior leadership roles as Chief Executive Officer and Chief Financial Officer of a public corporation. Mr. Zarcone has also held senior leadership roles as Managing Director and Chief Financial Officer of privately held companies. Mr. Zarcone has over 35 years of expertise in investment banking, wealth management, and capital markets bringing significant financial expertise to Generac. Mr. Zarcone earned his Bachelor of Science in Finance from the University of Illinois at Urbana-Champaign and Master of Business Administration from the University of Chicago Graduate School of Business. |
Class II Directors
Mr. Zarcone has elected not to stand for reelection at the annual meeting for LKQ Corporation. He will retire from its Board of Directors effective May 7, 2025.
Class II Directors
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Class III Directors
Class III Directors
Class III Directors
| KATHRYN V. BOHL | | | Age: 64 Director Since: 2016 | EXPERIENCE & QUALIFICATIONS • 2005-2016: Held various leadership roles at Sleep Number Corporation (formerly Select Comfort Corporation), a manufacturer of mattresses and sleep-related products, including ◦ Executive Vice President and Chief Services and Fulfillment Officer ◦ Executive Vice President, Product and Service, and ◦ Senior Vice President, Global Supply Chain • 1983-2005: Held various leadership roles at GE, including ◦ General Manager, Global Supply Chain Strategy, GE Healthcare, ◦ General Manager, Global Quality and Six Sigma, GE Healthcare, ◦ Vice President Technical Operations and Director/Vice President of Quality Programs for GE Clinical Services, a division of GE Healthcare, and Various roles in Sourcing, Engineering, and Manufacturing at GE Information Services and GE Healthcare Other Board Service • Current Lead Director of Columbus McKinnon Corporation, a public company that designs and manufactures precision material handling systems • Former Director of The Jones Family of Companies Ms. Bohl brings to Generac extensive leadership experience across B2B and B2C sophisticated technology products and services and consumer/retail businesses. Ms. Bohl has held several senior level management positions, giving her significant experience in strategic growth and development and human resources/talent management. Ms. Bohl has over 30 years of expertise that includes extensive risk management, regulatory compliance, operations, and supply chain experience. Ms. Bohl graduated with a Bachelor of Science in Mechanical Engineering from Michigan State University. |
Class III Directors
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Class III Directors
| ROBERT D. DIXON | | | Age: 65 Director Since: 2012 | EXPERIENCE & QUALIFICATIONS • 2014-2016: Chairman and CEO of Natural Systems Utilities LLC, a distributed water infrastructure company • 2012-2014: Chief Executive Officer of Seven Seas Water Corporation, an international services corporation • 1983-2011: Held various leadership roles at Air Products and Chemicals, Inc., including Senior Vice President & General Manager Other Board Service • Former Director of Valicor Environmental Services Mr. Dixon brings to Generac over 30 years of global management, operations and finance experience. Mr. Dixon has significant prior experience working in the energy industry, including specifically within the industrial gas sector on various clean energy initiatives. Mr. Dixon also brings vast international experience to Generac, having managed international operations for the majority of his career, including spending several years working overseas in Asia. Mr. Dixon earned a Bachelor of Business Administration from Miami University and a Master of Business Administration from Pennsylvania State University. He also attended the Advanced Management Program at INSEAD in Fontainebleau, France. |
Class III Directors
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Class III Directors
| WILLIAM D. JENKINS, JR. | | | Age: 59 Director Since: 2017 | EXPERIENCE & QUALIFICATIONS • 2021-Current: President of Palo Alto Networks, a public cybersecurity firm • 2012-2021: President & Chief Executive Officer of Barracuda Networks, a private network technology company • 1998-2012: Held various positions at EMC Corporation, an information infrastructure company, including President of the Backup Recovery Systems division Other Board Service • Former Director of Skydeck Acquisition Corporation • Former Director of Barracuda Networks • Former Director of Sumo Logic • Former Lead Director for Apigee Corporation (acquired by Google, Inc.) • Former Director for Nimble Storage, Inc. (acquired by Hewlett Packard Enterprise Company) Mr. Jenkins brings to Generac over 10 years of cybersecurity and technology experience, including currently serving as the President of a leading global cybersecurity company. Mr. Jenkins holds a Bachelor of Science in General Engineering from the University of Illinois and a Master of Business Administration from Harvard Business School. |
Class III Directors
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Class III Directors
| DAVID A. RAMON | | | Age: 69 Director Since: 2010 | EXPERIENCE & QUALIFICATIONS • 1998-Current: Founder and Managing Partner of Vaduz Partners, a private investment firm • 2019-2024: Investment Partner in Gratitude Railroad, an alternative investment capital firm • 2014-2018: Chairman and Chief Executive Officer of Diversified Maintenance, a specialized facility services company • 2000-2007: President and Chief Executive Officer of USA.NET, Inc. • 1997-1998: President, Coleman Outdoor Recreation Group • 1994-1997: Held various senior management positions, including President and Chief Operating Officer of New World Television, Inc. • 1982-1994: Executive Vice President and Chief Financial Officer of Gillett Holdings, Inc. • Prior to 1982: Arthur Young & Company Other Board Service • Current Director of Sagent-CTAM Holdings, Inc., a leading network solutions provider • Former Director of Diversified Maintenance • Former Director of New World Communications Group, Inc. • Former Director of USA.NET, Inc. Mr. Ramon brings to Generac more than 30 years of broad management, operations, and investment experience with established consumer product markets, emerging companies in cloud computing and software services, and in enterprises that deliver positive social and environmental impact. Mr. Ramon also brings significant leadership and financial experience, having served as Chief Executive Officer, Chief Operating Officer, President or Chief Financial Officer for a number of privately held and public companies. Mr. Ramon’s work as a founder and managing partner of a private investment firm gives him significant and valuable capital markets experience. Mr. Ramon earned a Bachelor of Business Administration in Accounting from the University of Wisconsin. |
Class III Directors
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Criteria for Director Nominees
Criteria for Director Nominees In selecting director candidates, the Nominating and Corporate Governance Committee considers whether the candidates possess the required skill sets and fulfill the qualification requirements of directors approved by the Board of Directors, including integrity, objectivity, sound judgment, leadership and diversity in all aspects of that term. Annually, the Nominating and Corporate Governance Committee assesses the composition of the Board of Directors, including the Committee’s effectiveness in balancing the above considerations. Other than the foregoing, there are no minimum criteria for director nominees, although the Nominating and Corporate Governance Committee may consider such other factors as it may deem are in the best interests of the Company and its stockholders. The Nominating and Corporate Governance Committee does not assign specific weights to, and a potential or incumbent director will not necessarily satisfy all, the foregoing criteria, and in evaluating a candidate does not distinguish on the basis of whether the candidate was recommended by a stockholder.
Process for Identifying and Evaluating Director Nominees
Process for Identifying and Evaluating Director Nominees The Nominating and Corporate Governance Committee identifies nominees by first evaluating the current members of the Board of Directors willing to continue in service. Current members of the Board of Directors with skills and experience that are relevant to the Company’s business and who are willing to continue in service are considered for renomination, balancing the value of continuity of service by existing members of the Board of Directors with that of obtaining a new perspective on the Board. If any member of the Board of Directors does not wish to continue in service or if the Nominating and Corporate Governance Committee decides not to renominate a member for reelection, the Nominating and Corporate Governance Committee identifies the desired skills and experience of a new nominee based on the criteria listed above. Current members of the Nominating and Corporate Governance Committee and Board of Directors are polled for suggestions as to individuals meeting the criteria set by the Nominating and Corporate Governance Committee. Executive search firms may also be retained to identify qualified individuals. Stockholders who wish to recommend a candidate for consideration by the Nominating and Corporate Governance Committee may do so by sending the candidate’s name and supporting information to Mr. Robert Dixon, Nominating and Corporate Governance Committee, c/o Raj Kanuru, Executive Vice President, General Counsel, & Corporate Secretary, Generac Power Systems, Inc., S45 W29290 Highway 59, Waukesha, Wisconsin 53189. Our Bylaws contain provisions that address the processes by which a stockholder may nominate an individual to stand for election to the Board of Directors. See “NOMINATIONS AND PROPOSALS BY STOCKHOLDERS” below for additional information.
Generac’s Executive Compensation Practices
| WHAT WE DO: | | | | | Pay for Performance | On average 75% or more of NEO pay is based on the achievement of specific annual and long-term strategic and financial goals. | | | Independent Compensation Consultant | An independent consultant is retained by the Human Capital and Compensation Committee. | | | Stock Ownership Guidelines | Stock ownership guidelines have been established for executive officers and directors. | | | Compensation Risk Assessment | A compensation risk assessment is performed on a regular basis. In June 2024, the Human Capital and Compensation Committee’s independent consultant completed the assessment to identify and evaluate material risks associated with our compensation programs. This assessment helps ensure our executive compensation arrangements do not incentivize excessive risk-taking that could harm the Company or its stakeholders. | | | Clawback Policies | We have a clawback policy that requires all executive officers to return excess incentive-based compensation resulting from an applicable accounting restatement. We also have a clawback policy that requires the CEO, CFO, all other NEOs, as well as certain members of executive management, to reimburse or foreit certain incentive compensation received in instances of gross negligence or misconduct that result in significant harm to the Company. | | | ESG in Incentive Plan | Our short-term incentive plan in 2024 included individual executive officer ESG goals related to the development of certain ESG initiatives and qualitative metrics to measure success over time. |
Generac’s Executive Compensation Practices
| WHAT WE DO NOT DO: | | | | | Hedging of Company Stock | It is against Company policy to trade in puts or calls in Company securities, sell Company securities short, or otherwise hedge ownership of Company securities. | | | Pledging of Company Stock | Executive officers may not pledge Company securities or hold Company securities in margin accounts. | | | Tax Gross Ups | Executive officers do not receive tax gross ups either directly or indirectly. | | | Dividends on Unearned Performance Awards | Executive officers do not receive dividends on unearned performance awards. | | | “Single Trigger” Change in Control Severance Provisions | Executive officers do not have severance arrangements that trigger solely by virtue of a change in control. |
Recent Executive Compensation Program Changes
| | Pay for Performance | | Increased the weighting in performance share grants under the Long-Term Equity Incentive Program from 33% to 50%. | | Reflects the Company’s philosophy of linking executive pay with the long- term success of the Company. |
Philosophy and Objectives
| Pay Element | Form | Purpose | | Base Salary | Cash (Fixed) | Reflects position responsibilities, competitive market rates, strategic importance of the position, and individual experience. | | Annual Performance Bonus Plan (Short- Term Incentive) | Cash (Variable) | Rewards achievement of Generac’s annual financial goals and other qualitative and quantitative performance objectives as determined by the Committee. | | Long-Term Incentives | Equity (Variable) | Rewards strong performance with incentive awards that focus our executive team on creating stockholder value over the long-term. Highest weighting on performance shares supports our pay for performance philosophy. |
HOW COMPENSATION DECISIONS ARE MADE
The Committee, composed solely of independent directors, is responsible for making executive compensation decisions for the NEOs. The Committee works closely with its independent compensation consultant and management to examine pay and performance matters throughout the year. Each year, the CEO and CFO establish a long-range plan and annual budget that is approved by the Board of Directors. The long-range plan and annual budget establish financial targets and other performance-related goals, which gives the Committee a basis for approving financial targets under the incentive plans for the year. The Committee also reviews the basis for establishing incentive goals and objectives related to the compensation of the NEOs. During this review, the Committee considers the balance between short-term cash compensation and long-term incentives and evaluates alignment of pay for performance considering established goals and objectives. The Committee also considers profitable growth of the business and financial performance. The Committee sets the CEO compensation based on that evaluation using peer group and market data to determine appropriate total direct compensation levels (consisting of base salary and annual and long-term incentives). The Committee also reviews and approves compensation for all executive officers using market data in conjunction with recommendations from the CEO and EVP, Human Resources. See “Assessing External Market Practice” below for more information. Finally, in making subjective evaluations of the overall performance of the CEO, the Committee considers performance from the perspective of our core values and our leadership principles, which include practicing integrity, driving innovation, demonstrating agility, operational excellence, developing our employees, and building a team environment. The CEO and EVP, Human Resources also provide the Committee with additional analyses and recommendations related to the compensation of the CFO, our other executive officers, and certain other key members of executive management. The annual analysis includes market compensation data and a review of factors such as industry knowledge, level of experience, scope and complexity of position, skill set, and future potential. Neither the CEO nor the EVP, Human Resources makes recommendations with respect to his or her own compensation.
HOW COMPENSATION DECISIONS ARE MADE
| The Role of the Independent Consultant |
HOW COMPENSATION DECISIONS ARE MADE
In 2024, Pay Governance provided advice to the Committee regarding executive-target pay, peer group, benchmarking of executive positions under the Committee’s purview, and annual and long-term incentive design, along with a variety of other compensation-related topics and trends. The Committee has assessed the independence of Pay Governance pursuant to the SEC rules and concluded that no conflict of interest exists that would prevent Pay Governance from independently advising the Committee.
HOW COMPENSATION DECISIONS ARE MADE
Attracting and incentivizing high caliber executive talent is a critical part of our compensation philosophy and leadership strategy. Therefore, integral to our approach for setting compensation levels is ensuring we have a competitive pay framework. In support of this objective, our independent compensation consultant annually provides the Committee with compensation data with respect to similarly sized manufacturing and technology companies in the identified peer group and amongst similarly sized general industry and technology companies from published surveys. In 2024, the Committee considered both peer group proxy and general industry and technology company survey data sources in determining competitive total direct compensation benchmarks for our CEO and CFO. General industry and technology company market survey data was considered in determining market total direct compensation benchmarks for all other executives that directly report to the CEO. The Committee has generally targeted the market median for total cash compensation of our NEOs, with the opportunity to meet or exceed market median if the Company achieves outstanding financial performance in a particular year. The Committee also has targeted long-term incentive grant values at the market median, which may result in total direct compensation at or above the market median with outstanding financial performance. Peer group composition is also reviewed annually. At the request of the Committee, Pay Governance evaluated the peer group to ensure alignment with the Company’s energy technology strategy and recent growth. As part of the review, the Committee considered the following criteria for inclusion in the peer group: company type, geographic span, location, size and scope of the business model, and other factors including recent merger, acquisition, restructuring or financial distress. Based on the following criteria no changes were made in 2024. Subsequent to the review,the Committee examined the compensation practices of the following peer group companies for 2024 compensation decisions:
Base Salary
In February 2024, the Committee met to determine our NEO’s base pay, short or long-term incentive opportunities and to discuss results of the 2023 annual cash incentive program. Based on sustained performance, market benchmarking and to further align pay to market competitive levels, the Human Capital and Compensation Committee recognized Mr. Raabe with an increase in base salary to $430,000. Based on market benchmarking and conditions, 2023 performance, and other factors for the NEOs, the Committee approved increases in base salaries for Messrs. Ragen, Taffe, and Wilde to $550,000, $450,000, and $450,000 respectively. Mr. Jagdfeld’s salary was not changed. In March 2025, the Committee again reviewed market benchmarking, 2024 performance, and other factors for the NEOs. For Messrs. Jagdfeld, Ragen, Taffe, Wilde and Raabe the Committee approved increases to base salaries to $1,100,000, $578,000, $466,000, $466,000, and $467,000, respectively.
Annual Performance Bonus Plan
Annual Performance Bonus Plan Under the Annual Performance Bonus Plan, the Committee approved the financial targets of the 2024 Annual Incentive Plan (“AIP”). Consistent with prior years, the target annual incentive is calculated as a percentage of base salary and is paid in cash. In February 2024, the Committee approved increases to the target AIP award opportunity for Messrs. Ragen and Taffe from 75% to 80% of salary. Target AIP award multiples of salary remained unchanged for the other NEOs.
Annual Performance Bonus Plan
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Annual Performance Bonus Plan
The Threshold, Target, and Maximum annual incentive opportunities for each NEO for 2024 are as follows:
Annual Performance Bonus Plan
| | Bonus as % of Base Salary | | | | Individual Performance Modifier(2) | | Named Executive Officer | Below Threshold | Threshold | Target | Maximum(1) | | | Aaron Jagdfeld | 0% | 65% | 130% | 260% | -100% to +15% | | York Ragen | 0% | 40% | 80% | 160% | -100% to +15% | | Norman Taffe | 0% | 40% | 80% | 160% | -100% to +15% | | Erik Wilde | 0% | 37.5% | 75% | 150% | -100% to +15% | | Kyle Raabe | 0% | 37.5% | 75% | 150% | -100% to +15% |
Annual Performance Bonus Plan
(1) The Maximum annual incentive opportunity does not reflect adjustment for the individual performance modifier. (2) In its discretion, the Committee may reduce the amount of any payout calculated in accordance with the financial measures to zero or increase the payout by up to 15% in recognition of individual achievements. For 2024, the financial metrics used to determine payouts under the AIP did not change from 2023 as the Committee determined that the plan effectively connected the CEO, our executives, and our employees to our strategy and appropriate financial metrics for managing the business. The two financial metrics used were: Adjusted EBITDA (excluding the impact of acquisitions that occurred during the performance period and before deduction for noncontrolling interests) which constituted 75% of the target AIP opportunity, and “PWC” as a percentage of net sales, which constituted 25% of the target AIP opportunity. The Threshold payout level remained at 50% of target for both of the two financial metrics. An individual performance modifier can be applied after the Company financial performance results are calculated and may result in a reduction in payout to zero or an increase in payout up to 15%. The CEO and CFO had 100% of their cash incentive tied to the Company’s consolidated financial performance. Messrs. Taffe, Wilde and Raabe had 75% of their cash incentive tied to specific business group performance, as described further below. We consider the business group performance levels to be competitively sensitive information that is not otherwise disclosed; however, the Committee intended to use the same general level of rigor in setting the business group performance goals as was used in setting the performance goals for consolidated financial performance.
2024 Annual Performance Bonus Plan Results — Consolidated
2024 Annual Performance Bonus Plan Results — Consolidated The 2024 consolidated financial targets for Adjusted EBITDA and PWC (as a percentage of net sales) were $744.3 million and 32.2%, respectively. Achievement of the consolidated financial targets would result in a 100%-of-Target payout for the two components in the AIP, assuming no individual performance modifier was applied to recognize individual performance. Under the AIP, the consolidated Adjusted EBITDA (excluding the impact of acquisitions that occurred during the performance period and before deduction for noncontrolling interests) was $789.1 million, which was above Target. The consolidated PWC (as a percentage of net sales), excluding the impact of acquisitions, was 30.5%, which was also above Target. As a result, the Committee approved a payout of 137% for 2024 for those solely with enterprise-wide responsibilities, including Messrs. Jagdfeld and Ragen.
2024 Annual Performance Bonus Plan Results — Consolidated
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2024 Annual Performance Bonus Plan Results — Consolidated
| | 2024 Financial Goals | | | | | | Annual Performance Bonus Metrics — Consolidated | Threshold | Target | Maximum | 2024 Achievement | Weighted Payout % | | Adjusted EBITDA (75%)* | $595.4 million | $744.3 million | $893.2 million | $789.1 million | 97.5% | | PWC as % of Net Sales (25%) | 35.2% | 32.2% | 29.2% | 30.5% | 39.5% | | Overall Payout | | | | | 137% |
2024 Annual Performance Bonus Plan Results — Consolidated
* Adjusted EBITDA under the AIP excludes the impact of acquisitions that occurred during the performance period and is calculated before deduction for noncontrolling interests. For the three other NEOs, AIP payouts were determined as follows:
2024 Annual Performance Bonus Plan Results — Consolidated
| NEO | Metrics | Results | | Norman Taffe | Energy Technology Adjusted EBITDA — 50% Energy Technology PWC — 25% Consolidated Adjusted EBITDA — 25% | Below Target Below Threshold Above Target | | Erik Wilde | Domestic C&I Adjusted EBITDA — 50% Domestic C&I PWC — 25% Consolidated Adjusted EBITDA — 25% | At Maximum Above Target Above Target | | Kyle Raabe | Consumer Power Adjusted EBITDA — 50% Consumer Power PWC — 25% Consolidated Adjusted EBITDA — 25% | Above Target At Maximum Above Target |
2024 Annual Performance Bonus Plan Results — Consolidated
The Committee maintains its discretion to adjust the annual performance bonus payouts, regardless of the results against incentive bonus metrics. For 2024, the Committee made no adjustments or modifications to the financial targets or payouts. The payout for financial results is then subject to the individual performance modifier, which is a multiplicative factor that can increase or decrease the final payout. The individual performance modifier allows for adjustments for each NEO’s performance against certain defined and measurable goals established at the commencement of the year and developed to achieve specific initiatives related to the Company’s long-term strategy. The Committee determined the individual performance modifier for the CEO and reviewed the CEO’s recommendations for the other NEOs, which considered each executive’s individual performance. Individual performance modifiers were applied to the payout for three NEOs as shown below.
2024 Annual Performance Bonus Plan Results — Consolidated
| Named Executive Officer | AIP Target | 2024 AIP Financial Achievement(1) | Individual Performance Modifier | 2024 AIP Payment | | Aaron Jagdfeld | $1,365,000 | 137.0% | +5% | $1,963,553 | | York Ragen | $440,000 | 137.0% | +5% | $632,936 | | Norman Taffe | $360,000 | 68.4% | 0% | $246,175 | | Erik Wilde | $337,500 | 178.0% | 0% | $600,656 | | Kyle Raabe | $322,500 | 165.0% | +10% | $585,082 |
2024 Annual Performance Bonus Plan Results — Consolidated
Achievement percentages are based on achievement of financial targets and exclusive of the individual performance modifier.
2024 Annual Performance Bonus Plan Results — Consolidated
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Long-Term Incentives
Long-Term Incentives Generac believes that equity awards and other forms of long-term incentive compensation are a critical component of a competitive, comprehensive annual compensation program for NEOs and other executives. Our long-term incentive program (“LTIP”) is designed to reward our executives for their contribution to the Company’s long-term growth and performance, and to better align the interests of our NEOs with those of our stockholders. In addition, our long-term awards are used to attract and retain critical employee talent by providing a competitive market-based opportunity. In February 2024, the Committee approved an increase in the weighting of performance shares to 50% for long-term incentive awards with a decrease in the weighting of restricted stock and stock options to 25% each. The 2023 target grant mix was an equal weighting of the three award types. The grants made in 2024 had the following terms: • Performance Shares. Fifty percent (50%) of the award was granted in the form of performance shares, which are performance-based restricted stock units. NEOs may earn from 0% to 200% of their target performance share awards based on the achievement of specified revenue growth, EBITDA margin, and Free Cash Flow Conversion goals. Each performance share has a value equal to a share of common stock and the number of shares that can be earned is contingent upon Company performance, over a three-year performance period, against goals approved by the Committee. • Restricted Stock. Twenty-five percent (25%) of the award was granted in the form of restricted stock, with those shares vesting equally over the three annual anniversaries immediately following the date of grant. • Stock Options. Twenty-five percent (25%) of the award was granted in the form of stock options, with those options vesting equally over the four annual anniversaries immediately following the date of grant.
2024 Long-Term Equity Incentive Mix
2024 Long-Term Equity Incentive Mix
2024 Long-Term Equity Incentive Mix
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2024 Long-Term Equity Award Target Grant Values
2024 Long-Term Equity Award Target Grant Values The March 2024 grant date value of the LTIP awards to the NEOs were as follows:
2024 Long-Term Equity Award Target Grant Values
| Named Executive Officer | Stock Options | Restricted Stock | Performance Shares | Total LTIP Grants | | Aaron Jagdfeld | $1,562,539 | $1,562,605 | $3,125,098 | $6,250,242 | | York Ragen | $328,138 | $328,129 | $656,258 | $1,312,525 | | Norman Taffe(1) | $216,782 | $216,804 | $2,433,643 | $2,867,229 | | Erik Wilde | $218,442 | $218,490 | $436,869 | $873,801 | | Kyle Raabe | $200,002 | $200,049 | $400,096 | $800,147 |
2024 Long-Term Equity Award Target Grant Values
(1) The performance shares amount for Mr. Taffe includes a supplemental performance-equity award as described below.
Supplemental Performance-Based Equity Award
Supplemental Performance-Based Equity Award Effective March 1, 2024, the Committee granted a supplemental award of performance shares to Mr. Taffe valued at $2,000,000, at target achievement level, with a three-year performance period ending December 31, 2026. Other than the use of financial metrics tied to the Company’s Energy Technology business for measuring target achievement and share payout, the award has the same vesting terms and conditions as the performance shares received by other executives in 2024. The Committee granted the supplemental performance shares to incentivize Mr. Taffe to execute the Company’s strategic plan and lead the Company’s Energy Technology business to more resilient, efficient, and sustainable energy solutions.
2022-2024 Performance Share Results
2022-2024 Performance Share Results The NEOs held performance shares granted in 2022 that could vest based on results during the three-year performance period covering 2022 to 2024. This grant was intended to encourage revenue growth measured in compound annual growth rate (“CAGR”), Adjusted EBITDA margin, and Free Cash Flow (“FCF”) Conversion for 2022 to 2024. Specifically, if revenue CAGR, average Adjusted EBITDA margin, and FCF Conversion during the period were achieved within a defined range on a performance matrix, the NEOs would earn from 50% to 200% of their target performance share awards. The revenue CAGR, Adjusted EBITDA margin, and FCF Conversion targets were set at a level, given business conditions at the time the awards were granted, that were designed to be challenging but achievable with strong management performance. After the conclusion of the three-year period, the performance share targets were measured against actual financial results for Generac, excluding any businesses acquired during the three-year period. For the three-year period from 2022 to 2024, the Committee determined that none of the threshold levels were achieved and, accordingly, no vesting occured. The Threshold, Target, and Maximum financial performance metrics and the actual results for the 2022 to 2024 performance awards are reflected below:
2022-2024 Performance Share Results
| Performance Measure | Weight | Threshold | Target | Maximum | Actual 2022-2024 Cycle Results | Final Vesting | | Revenue Growth (CAGR) | 33% | 12.0% | 16.0% | 20.0% | 4.4% | | | Adjusted EBITDA Margin % | 33% | 20.8% | 22.8% | 24.8% | 18.7% | 0.0% | | FCF Conversion % | 33% | 75.0% | 85.0% | 95.0% | 70.6% | |
2022-2024 Performance Share Results
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Clawback Policies and Prohibition on Hedging and Pledging
Clawback Policies and Prohibition on Hedging and Pledging Effective April 2019, the Company adopted a formal “clawback” policy applicable to annual and long-term incentive awards made to the CEO, CFO and any other key member of executive management identified by the board or CEO. Under this policy, the Company may seek to recoup incentive compensation paid to covered employees to the extent that such compensation was granted, vested, or earned based on financial results that the Company is required to restate as a result of material noncompliance with any financial reporting requirement under federal securities laws. In March 2022, the Company expanded the policy to allow recoupment of incentive compensation paid in the event of gross negligence in performance or misconduct resulting in a violation of law or Company policy, where such acts resulted in significant financial or reputational harm to the Company. In September 2023, the Company revised its clawback policy to comply with SEC and NYSE rules. The revised policy applies to all incentive-based compensation, which is any compensation that is granted, earned, or vested based wholly or in part upon the attainment of a financial reporting measure, received by Section 16 officers of the Company. The policy provides that, in the event of an accounting restatement, the Committee will determine the amount of the erroneously awarded compensation, which is the excess of the amount of incentive-based compensation received by current and former executive officers during the three completed fiscal years immediately preceding the required restatement date over the amount of incentive-based compensation that otherwise would have been received had it been determined based on the restated amounts. The Company will recover the erroneously awarded compensation in a reasonable and prompt manner using any lawful method, subject to limited exceptions as permitted by NYSE listing standards. The Company also expanded its clawback policy to allow the Company to recoup incentive compensation received by other members of management, subject to exercise of the Committee’s discretion to determine the appropriate amount of recovery. The Company also maintains its misconduct policy, under which the CEO, CFO and other key members of executive management, including all NEOs, are required to reimburse or forfeit certain incentive compensation received in certain instances of an executive officer’s gross negligence or misconduct, including a failure to manage and monitor risks, that result in significant harm to the Company. Under our Insider Trading Policy, officers, directors, and certain employees as well as their family members may not engage in short-selling Company common stock at any time. Such individuals are also prohibited from engaging in hedging transactions (including forward sale contracts, equity swaps, collars, and similar derivative transactions), short sales, purchase of publicly traded options, or short swing transactions. Additionally, all officers, directors, and employees subject to the stock ownership guidelines outlined below, are also prohibited from directly or indirectly pledging Company securities, including holding Company securities in a margin account. The prohibition on hedging does not preclude general portfolio diversification or investing in broad-based index funds.
Long Term Equity Award Grant Timing
Long Term Equity Award Grant Timing The Committee generally makes grants of long-term equity awards to our NEOs at the first Committee meeting of our fiscal year, which is the same meeting at which the Committee takes other compensation actions and performs its annual performance evaluation of management. Annual long-term equity awards for our officers occur on the same date as long-term equity awards for our other professional and managerial employees, which is typically on March 1 of the fiscal year. Awards are neither timed to relate to the price of our stock nor to correspond with the release of material non-public information, although grants are generally made when our trading window is open. We may make grants to new employees, including potential NEOs, when they are hired. Awards for NEOs are made following committee approval and typically occur in the quarter following the employee start date. During 2024, we did not award stock options or stock appreciation rights to any of our NEOs in the period beginning four business days before our filing of a Form 10-Q or Form 10-K, or the filing or furnishing of a Form 8-K that disclosed material nonpublic information, and ending one business day after the filing or furnishing of such report.
2024 Summary Compensation Table
2024 Summary Compensation Table The following table shows compensation information for 2022, 2023 and 2024 for our named executive officers.
2024 Summary Compensation Table
| Name and principal position | Year | Salary ($) | Bonus ($) | Stock awards ($)(1) | Option awards ($)(1) | Non-equity incentive plan compensation ($)(2) | All other compensation ($)(3) | Total ($) | | Aaron Jagdfeld Chairman, President and Chief Executive Officer | 2024 | 1,050,000 | — | 4,687,703 | 1,562,539 | 1,963,553 | 34,171 | 9,297,966 | | | 2023 | 1,050,000 | — | 3,996,222 | 2,004,001 | — | 34,742 | 7,084,966 | | | 2022 | 1,039,178 | — | 3,829,669 | 1,920,529 | — | 18,300 | 6,807,676 | | York Ragen Chief Financial Officer | 2024 | 545,150 | — | 984,387 | 328,138 | 632,936 | 21,433 | 2,512,044 | | | 2023 | 525,000 | — | 874,316 | 438,418 | — | 19,846 | 1,857,580 | | | 2022 | 515,616 | — | 874,342 | 438,474 | — | 12,200 | 1,840,632 | | Norman Taffe President, Energy Technology | 2024 | 446,799 | — | 2,650,447 | 216,782 | 246,175 | 11,499 | 3,571,702 | | | 2023 | 426,956 | — | 1,495,415 | 248,777 | 50,160 | 10,106 | 2,231,115 | | | 2022 | 152,534 | — | 2,000,413 | — | — | 2,942 | 2,155,889 | | Erik Wilde President, Domestic C&I | 2024 | 447,439 | — | 655,359 | 218,442 | 600,656 | 20,154 | 1,942,050 | | | 2023 | 423,866 | — | 489,636 | 245,490 | 459,427 | 12,250 | 1,630,669 | | | 2022 | 414,877 | — | 489,606 | 245,570 | 109,778 | 8,840 | 1,268,671 | | Kyle Raabe President, Consumer Power | 2024 | 424,180 | — | 600,146 | 200,002 | 585,082 | 18,542 | 1,809,410 | | | 2023 | 400,000 | — | 532,909 | 267,232 | 165,317 | — | 1,365,458 | | | 2022 | — | — | — | — | — | — | — |
2024 Summary Compensation Table
(1) The amounts reported for 2024 represent the aggregate grant date fair value for awards of restricted stock, stock options, and performance shares and are computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Subtopic 718. See Note 17 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of the relevant assumptions used in calculating these amounts. All amounts represent potential future income calculated for financial reporting purposes; actual amounts recognized by the named executive officers may be materially different depending on, among other things, the Company’s stock price performance and the period of service of the executive. The Stock Award amounts are composed in equal measure of restricted stock and performance shares, with the performance share portion assuming target performance by the Company during the relevant performance period. Assuming achievement of maximum performance during the relevant performance period for the performance shares portion of the Stock Award amounts would increase by a multiplier of 2.0 (or, in the case of Mr. Taffe, his Stock Award amount includes a $2,000,000 supplemental award of performance shares which would also increase by a multiplier of 2.0 for maximum performance). (2) The non-equity incentive plan compensation column reflects cash incentive awards earned pursuant to our Annual Performance Bonus Plan as previously described. These awards are earned during the year reflected and paid in the following year. All other compensation represents the employer matching contributions and employer nonelective contributions of the 401(k) Savings Plan.
2024 Summary Compensation Table
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Grants of Plan-Based Awards in 2024
Grants of Plan-Based Awards in 2024 The following table indicates potential cash incentive compensation under our Annual Performance Bonus Plan based on 2024 performance and equity awards granted in 2024 under our Amended and Restated 2019 Equity Incentive Plan.
Grants of Plan-Based Awards in 2024
| | | | Possible payouts under non-equity incentive plan awards(1) | | | Possible payouts under equity incentive plan awards(2) | | | All other stock awards: number of shares of stock or units (#)(3) | All other option awards: number of securities underlying options (#)(4) | Exercise or base price of option awards ($/sh)(5) | Closing market price on date of grant ($/sh) | Grant date fair value of stock and option awards ($) | | Name | Grant Date | Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | | Aaron Jagdfeld | — | — | 887,250 | 1,365,000 | 2,730,000 | — | — | — | — | — | — | — | — | | | 3/1/24 | 2/23/24 | — | — | — | 13,896 | 27,791 | 55,582 | — | — | — | — | 3,125,098 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | 13,896 | — | — | — | 1,562,605 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | — | 26,352 | $112.45 | $114.18 | 1,562,539 | | York Ragen | — | — | 176,000 | 440,000 | 880,000 | — | — | — | — | — | — | — | — | | | 3/1/24 | 2/23/24 | — | — | — | 2,918 | 5,836 | 11,672 | — | — | — | — | 656,258 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | 2,918 | — | — | — | 328,129 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | — | 5,534 | $112.45 | $114.18 | 328,138 | | Norman Taffe | — | — | 144,000 | 360,000 | 720,000 | — | — | — | — | — | — | — | — | | | 3/1/24 | 2/23/24 | — | — | — | 1,928 | 3,856 | 7,712 | — | — | — | — | 433,607 | | | 3/1/24 | 8/8/23 | — | — | — | 8,893 | 17,786 | 35,572 | | — | — | — | 2,000,036 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | 1,928 | — | — | — | 216,804 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | — | 3,656 | $112.45 | $114.18 | 216,782 | | Erik Wilde | — | — | 126,563 | 337,500 | 675,000 | — | — | — | | | | | | | | 3/1/24 | 2/23/24 | — | — | — | 1,943 | 3,885 | 7,770 | — | — | — | — | 436,869 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | 1,943 | — | — | — | 218,490 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | — | 3,684 | $112.45 | $114.18 | 218,442 | | Kyle Raabe | — | — | 120,938 | 322,500 | 645,000 | | | | | | | | | | | 3/1/24 | 2/23/24 | — | — | — | 1,779 | 3,558 | 7,116 | — | — | — | — | 400,096 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | 1,779 | — | — | — | 200,049 | | | 3/1/24 | 2/23/24 | — | — | — | — | — | — | — | 3,373 | $112.45 | $114.18 | 200,002 |
Grants of Plan-Based Awards in 2024
(1) For additional information regarding the AIP, please see the Compensation Discussion and Analysis above. (2) Represents an award of performance shares that vests between 50% to 200% of target on the third anniversary of the grant date if certain Company performance goals relating to the 2024-2026 performance period are met. (3) Represents an award of restricted stock, vesting in equal installments on each anniversary of the date of grant over three years. (4) Represents an award of stock options, vesting 25% on each anniversary of the date of grant over four years. (5) The exercise price is determined by averaging the high and low trading prices on the date of grant. The grant date fair values were computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Subtopic 718. See Note 17 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of the relevant assumptions used in calculating these amounts.
Grants of Plan-Based Awards in 2024
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2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2024:
2024 Outstanding Equity Awards at Fiscal Year-End
| | Option awards | | | | Stock awards | | | | | Name | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#) | Market value of shares or units of stock that have not vested ($) | Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#) | Equity incentive plan awards: market or payout value of unearned shares, units or other rights that have not vested ($) | | Aaron Jagdfeld | 109,052 | —(1) | 33.23 | 02/18/26 | — | — | — | — | | | 95,069 | —(2) | 40.12 | 03/01/27 | — | — | — | — | | | 94,044 | —(3) | 43.88 | 03/01/28 | — | — | — | — | | | 90,533 | —(4) | 52.07 | 03/01/29 | — | — | — | — | | | 37,762 | —(5) | 102.42 | 03/01/30 | — | — | — | — | | | 10,192 | 3,398(6) | 335.91 | 03/01/31 | — | — | — | — | | | 7,566 | 7,567(7) | 315.88 | 03/01/32 | 2,020(10) | 313,201 | 3,031(11) | 469,957 | | | 8,387 | 25,164(8) | 119.54 | 03/01/33 | 11,143(12) | 1,727,722 | 8,358(13) | 1,295,830 | | | — | 26,352(9) | 112.45 | 03/01/34 | 13,896(14) | 2,154,575 | 13,896(15) | 2,154,497 | | York Ragen | 24,362 | —(2) | 40.12 | 03/01/27 | — | — | — | — | | | 23,791 | —(3) | 43.88 | 03/01/28 | — | — | — | — | | | 22,634 | —(4) | 52.07 | 03/01/29 | — | — | — | — | | | 8,497 | —(5) | 102.42 | 03/01/30 | — | — | — | — | | | 1,936 | 646(6) | 335.91 | 03/01/31 | — | — | — | — | | | 1,727 | 1,728(7) | 315.88 | 03/01/32 | 460(10) | 71,323 | 692(11) | 107,295 | | | 1835 | 5,505(8) | 119.54 | 03/01/33 | 2,438(12) | 378,012 | 1,829(13) | 283,509 | | | | 5,534(9) | 112.45 | 03/01/34 | 2,918(14) | 452,436 | 2,918(15) | 452,436 | | Norman Taffe | 1,040 | 3,120(8) | 119.54 | 03/01/33 | 1,381(12) | 214,124 | 1,036(13) | 160,632 | | | — | 3,656(9) | 112.45 | 03/01/34 | 1,928(14) | 298,936 | 10,821(15) | 1,677,796 | | | — | — | — | — | 742(16) | 115,047 | 3,338(17) | 517,557 | | | — | — | — | — | 8,364(18) | 1,296,838 | — | — | | Erik Wilde | 8,375 | —(4) | 52.07 | 03/01/29 | — | — | — | — | | | 4,734 | —(5) | 102.42 | 03/01/30 | — | — | — | — | | | 1,409 | 470(6) | 335.91 | 03/01/31 | — | — | — | — | | | 967 | 968(7) | 315.88 | 03/01/32 | 257(10) | 39,848 | 388(11) | 60,082 | | | 1,027 | 3,083(8) | 119.54 | 03/01/33 | 1,365(12) | 211,643 | 1,024(13) | 1,677,796 | | | — | 3,684(9) | 112.45 | 03/01/34 | 1,943(14) | 301,262 | 1,943(15) | 301,185 | | Kyle Raabe | 1,063 | —(5) | 102.42 | 03/01/30 | — | — | — | — | | | 1,040 | 347(6) | 335.91 | 03/01/31 | — | — | — | — | | | 921 | 922(7) | 315.88 | 03/01/32 | 246(10) | 38,142 | 369(11) | 57,213 | | | 1,118 | 3,356(8) | 119.54 | 03/01/33 | 1,486(12) | 230,404 | 1,115(13) | 172,803 | | | — | 3,373(9) | 112.45 | 03/01/34 | 1,779(14) | 275,834 | 1,779(15) | 275,834 |
2024 Outstanding Equity Awards at Fiscal Year-End
(1) These options were granted on February 18, 2016, and have fully vested. (2) These options were granted on March 1, 2017, and have fully vested. (3) These options were granted on March 1, 2018, and have fully vested. (4) These options were granted on March 1, 2019, and have fully vested. (5) These options were granted on March 1, 2020, and have fully vested. (6) These options were granted on March 1, 2021, and vest 25% on each anniversary of the date of grant over four years.
2024 Outstanding Equity Awards at Fiscal Year-End
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2024 Outstanding Equity Awards at Fiscal Year-End
(9) These options were granted on March 1, 2024, and vest 25% on each anniversary of the date of grant over four years. (10) Represents an award of restricted stock granted March 1, 2022, and vests in equal installments on each anniversary of the date of grant over three years. (11) Represents an award of restricted stock with performance features granted March 1, 2022 at threshold performance level, which vests from 50% to 200% on the third anniversary of the grant date based on meeting certain Company performance goals relating to 2022-2024 fiscal years. (12) Represents an award of restricted stock granted March 1, 2023, and vests in equal installments on each anniversary of the date of grant over three years. (13) Represents an award of restricted stock with performance features granted March 1, 2023 at threshold performance level, which vests from 50% to 200% on the third anniversary of the grant date based on meeting certain Company performance goals relating to 2023-2025 fiscal years. (14) Represents an award of restricted stock granted March 1, 2024, and vests in equal installments on each anniversary of the date of grant over three years. (15) Represents an award of restricted stock with performance features granted March 1, 2024 at threshold performance level, which vests from 50% to 200% on the third anniversary of the grant date based on meeting certain Company performance goals relating to 2024-2026 fiscal years. (16) Represents an award of restricted stock granted September 1, 2022, and vests in equal installments on each anniversary of the date of grant over three years. (17) Represents an award of restricted stock with performance features granted September 1, 2022 at threshold performance level, which vests from 50% to 200% on March 1, 2026 based on meeting certain Company performance goals relating to 2023-2025 fiscal years. Represents an award of restricted stock granted September 1, 2023, and vests in equal installments on each anniversary of the date of grant over three years.
2024 Outstanding Equity Awards at Fiscal Year-End
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Option Exercises and Stock Vested in 2024
Option Exercises and Stock Vested in 2024 The following table sets forth information regarding option exercises and the vesting of stock awards during 2024 for our NEOs:
Option Exercises and Stock Vested in 2024
| | Option Exercises and Stock Vested in 2024 | | | | | | Option awards | | Stock awards | | | Name | Number of shares acquired on exercise (#) | Value realized on exercise ($) | Number of shares acquired on vesting (#)(1) | Value realized on vesting ($) | | Aaron Jagdfeld | 100,797 | $10,427,867 | 11,559 | $1,299,810 | | York Ragen | 29,081 | $4,405,632 | 2,435 | $273,816 | | Norman Taffe | — | — | 1,433 | $193,039 | | Erik Wilde | 4,384 | 482,936 | 1,490 | $167,551 | | Kyle Raabe | — | — | 1,393 | $156,643 |
Option Exercises and Stock Vested in 2024
(1) The actual shares received after withholding shares using the net share settlement method to cover the tax liability resulting from the vesting of such shares were 6,138, 1,675, 926, 861, and 778, for Mr. Jagdfeld, Mr. Ragen, Mr. Taffe, Mr. Wilde, and Mr. Raabe respectively.
Pay Ratio Disclosure
Pay Ratio Disclosure In accordance with Item 402(u) of Regulation S-K, passed as part of the Dodd-Frank Wall Street Reform Act and Consumer Protection Act of 2010, we determined the ratio of the annual total compensation of our CEO, Mr. Jagdfeld, relative to the annual total compensation of our median employee. Generac is a global organization with approximately 9,200 employees. For purposes of our 2024 pay ratio disclosure, we used the same median employee that we used for our 2023 disclosure, as there has not been a significant change in our employee population or employee compensation arrangements that we believe would significantly impact the pay ratio disclosure. We identified our median employee using payroll data to examine the annual base salaries for all individuals who were employed as of November 30, 2023. We then used annual cash compensation paid to each employee, other than our CEO, to selected median employees. For purposes of reporting annual total compensation and the 2024 ratio of annual total compensation of the CEO to the median employee, both the CEO and median employee’s annual total compensation were calculated consistent with the disclosure requirement of executive
Pay Ratio Disclosure
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Pay Ratio Disclosure
compensation under the Summary Compensation Table. Consistent with prior years and to present a holistic view of total compensation, we elected to include the value of health and welfare benefits in the annual total compensation of both our CEO and our median employee. The results of the 2024 ratio calculation are as follows: Annual total compensation of our median employee: $76,612 • Annual Total Compensation of CEO: $9,311,656 • Ratio of CEO annual total compensation to median employee compensation: 122 to 1
Pay Versus Performance
Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid and certain financial performance of the Company. The table below reflects Compensation Actually Paid to the Company’s CEO and average Compensation Actually Paid to Non-CEO NEOs during 2020 through 2024. In addition, the table compares the Company’s Total Shareholder Return (“TSR”) against peer group TSR using S&P 500 Industrials (sector comparison). For further information concerning the Company’s variable pay-for-performance philosophy and how the Company aligns executive compensation with the Company’s performance, refer to “EXECUTIVE COMPENSATION — Compensation Discussion and Analysis” above.
Pay Versus Performance
| | Summary Compensation Table Total for CEO ($) | Compensation Actually Paid to CEO ($)(1) | Average Summary Compensation Table Total for non-CEO NEOs ($)(1) | Average Compensation Actually Paid to non-CEO NEOs ($)(1) | Value of Initial Fixed $100 Investment Based On:(2)(3) | | Net Income ($ millions)(4) | Adjusted EBITDA ($ millions)(4)(5) | | Fiscal Year | | | | | Total Shareholder Return ($)(2) | S&P 500 Industrials (Sector) TSR ($)(3) | | | | 2024 | 9,297,966 | 12,023,483 | 2,463,437 | 3,140,627 | 154.04 | 176.44 | 316.9 | 789.1 | | 2023 | 7,084,966 | 9,034,716 | 1,771,206 | 2,130,483 | 128.42 | 150.20 | 217.1 | 637.9 | | 2022 | 6,807,676 | (19,271,201) | 1,613,648 | (2,405,918) | 100.03 | 127.15 | 408.9 | 825.4 | | 2021 | 7,519,812 | 40,727,644 | 2,178,594 | 9,342,402 | 349.76 | 134.52 | 556.6 | 861.4 | | 2020 | 6,961,596 | 44,219,485 | 1,748,639 | 9,772,607 | 226.04 | 111.06 | 347.2 | 583.8 |
Pay Versus Performance
(1) Amounts represent Summary Compensation Table (“SCT”) total compensation and compensation actually paid (“CAP”) to our primary executive officer (our CEO), and the average SCT compensation and CAP to our remaining NEOs for the relevant fiscal year. Our NEOs include the individuals indicated in the table below for each fiscal year:
Pay Versus Performance
| Year | CEO | Non-CEO NEOs | | 2024 | Aaron P Jagdfeld | Kyle Raabe, York Ragen, Norm Taffe, and Erik Wilde | | 2023 | Aaron P Jagdfeld | Kyle Raabe, York Ragen, Norm Taffe, and Erik Wilde | | 2022 | Aaron P Jagdfeld | Patrick Forsythe, York Ragen, Norm Taffe, and Erik Wilde | | 2021 | Aaron P Jagdfeld | Patrick Forsythe, Russell Minick, York Ragen, and Erik Wilde | | 2020 | Aaron P Jagdfeld | Patrick Forsythe, Russell Minick, York Ragen, and Erik Wilde |
Pay Versus Performance
| | 54 | 2025 Proxy Statement |
Pay Versus Performance
CAP represents the SCT total compensation for the applicable fiscal year, adjusted as set forth below. None of our NEOs participate in a pension plan; therefore, no adjustments from the SCT total related to pension value are needed.
Pay Versus Performance
| | 2024 | | | Adjustments | CEO | Average non- CEO NEOs | | Deduction for Amounts Reported under the “Stock Awards” and “Option Awards” Columns in the Summary Compensation Table for Applicable FY | $(6,250,242) | $(1,463,426) | | Increase based on ASC 718 Fair Value of Awards Granted during Applicable FY that Remain Unvested as of Applicable FY End, determined as of Applicable FY End | $8,922,662 | $2,064,646 | | Increase based on ASC 718 Fair Value of Awards Granted during Applicable FY that Vested during Applicable FY, determined as of Vesting Date | $0 | $0 | | Increase/deduction for Awards Granted during Prior FY that were Outstanding and Unvested as of Applicable FY End, determined based on change in ASC 718 Fair Value from Prior FY End to Applicable FY End | $641,249 | $144,460 | | Increase/deduction for Awards Granted during Prior FY that Vested During Applicable FY, determined based on change in ASC 718 Fair Value from Prior FY End to Vesting Date | $(588,152) | $(68,490) | | Deduction of ASC 718 Fair Value of Awards Granted during Prior FY that were Forfeited during Applicable FY, determined as of Prior FY End | $0 | $0 | | Increase based on Dividends or Other Earnings Paid during Applicable FY prior to Vesting Date | $0 | $0 | | TOTAL ADJUSTMENTS | $2,725,517 | $667,190 |
Pay Versus Performance
(2) TSR is calculated based on a fixed investment of one hundred dollars measured from the market close on December 31, 2019 through and including the end of each fiscal year reported in the table. (3) Our peer group is the S&P 500 Industrials (Sector) Index, which is the industry index used to show our performance in our Form 10-K. (4) Net income and Adjusted EBITDA as reported in the Pay Versus Performance Table are before adjusting for non-controlling interests. Our company-selected measure, which is the measure we believe represents the most important financial performance measure not otherwise presented in the table above that we use to link CAP for fiscal 2024 to performance, is Adjusted EBITDA, which is a Non-GAAP measure that excludes the impact of acquisitions. A reconciliation of Adjusted EBITDA to net income can be found in Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Pay Versus Performance
| | 55 | 2025 Proxy Statement |
Most Important Pay Versus Performance Financial Measures
Most Important Pay Versus Performance Financial Measures We believe the following represent the most important financial performance measures used by us to link CAP to our NEOs for the fiscal year ended December 31, 2024:
Most Important Pay Versus Performance Financial Measures
| Adjusted EBITDA | | Primary Working Capital (“PWC”) as a Percent of Net Sales | | Annual Revenue Growth Rate (“CAGR”) | | Adjusted EBITDA Margin Percentage | | Free Cash Flow (“FCF”) |
Most Important Pay Versus Performance Financial Measures
The Compensation Discussion and Analysis provides a further description of how these metrics are defined and used in the Company’s executive compensation program.
Most Important Pay Versus Performance Financial Measures
| | 57 | 2025 Proxy Statement |
Most Important Pay Versus Performance Financial Measures
Non-employee directors are paid in accordance with the Company’s Non-Employee Director Compensation Policy, as amended. The following table shows compensation information for 2024 for our Board of Directors.
Most Important Pay Versus Performance Financial Measures
| Name | Fees earned ($) | Stock awards ($)(1)(2) | Total ($) | | Marcia Avedon | 110,000 | 155,072 | 265,072 | | Kathryn Bohl | 90,000 | 155,072 | 245,072 | | John Bowlin | — | 245,210 | 245,210 | | Robert Dixon | 105,000 | 155,072 | 260,072 | | William Jenkins(3) | 155,000 | 90,271 | 245,271 | | Andrew Lampereur | — | 270,337 | 270,337 | | Bennett Morgan | — | 275,421 | 275,421 | | Nam Nguyen | — | 245,210 | 245,210 | | David Ramon | 90,000 | 155,072 | 245,072 | | Dominick Zarcone | — | 245,210 | 245,210 |
Most Important Pay Versus Performance Financial Measures
(1) Represents shares received in connection with annual equity grants and, if elected in lieu of cash by the non-employee director, quarterly retainer fees. The amounts indicated represent the aggregate grant date fair value for awards of stock (including Deferred Stock Units), computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Subtopic 718. See Note 17 to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of the relevant assumptions used in calculating these amounts. (2) As of December 31, 2024, each individual who served as a non-employee director during 2024 had outstanding the following number of stock awards, all of which consist of Deferred Stock Units issued pursuant to the Company’s Deferred Stock Unit Plan for Non-Employee Directors:
Most Important Pay Versus Performance Financial Measures
| Name | Stock awards (#) | | Marcia Avedon | 1,166 | | Kathryn Bohl | 11,965 | | John Bowlin | — | | Robert Dixon | 10,549 | | William Jenkins | 1,417 | | Andrew Lampereur | 19,040 | | Bennett Morgan | 14,458 | | Nam Nguyen | — | | David Ramon | 6,592 | | Dominick Zarcone | 14,161 |
Most Important Pay Versus Performance Financial Measures
Mr. Jenkins has met the minimum stock ownership requirements and elected to receive his annual equity retainer in the form of cash.
Most Important Pay Versus Performance Financial Measures
| | 58 | 2025 Proxy Statement |
Most Important Pay Versus Performance Financial Measures
Non-employee directors are subject to our stock ownership policy described under “Stock Ownership and Retention Guidelines.” Non-employee directors have five years to meet their minimum ownership requirement. As of March 31, 2025, all non-employee directors are compliant with the applicable stock ownership guidelines.
Non-Employee Director Pay
Non-Employee Director Pay Non-employee directors receive an annual cash retainer of $90,000 and an annual equity grant valued at $155,000. The additional annual retainer paid to the Chair of the Audit Committee is $25,000, the additional annual retainer paid to the Chair of the Human Capital and Compensation Committee is $20,000, the additional annual retainer paid to the Chair of the Nominating and Corporate Governance Committee is $15,000, and the additional annual retainer paid to the Lead Director is $30,000. The annual equity grant is made in the form of fully vested shares of our common stock; however, any director who has met the minimum stock ownership requirement may elect to receive the value of the annual equity grant in cash. Our non-employee directors are reimbursed for out-of-pocket expenses incurred in connection with rendering board services.
Non-Employee Director Pay
| | 2024 Annual Retainers | | Board Compensation | | | Annual Retainer | $90,000 | | Annual Equity Retainer | $155,000 | | Additional Board Leadership Retainers | | | Lead Director | $30,000 | | Audit Committee Chair | $25,000 | | Human Capital and Compensation Committee Chair | $20,000 | | Nominating and Corporate Governance Committee Chair | $15,000 |