DEF 14A of Methode Electronics Inc
Filed Jul 29, 2024 · FY20240001140361-24-034662
Summary of Qualifications of Director Nominees
Summary of Qualifications of Director Nominees The following table highlights certain skills, experience and qualifications that each of the director nominees brings to the Board.
Summary of Qualifications of Director Nominees
| Skills and Experience | Blom | Bobek | Cadwallader | Crowther | Dawson | DeGaynor | Goddard | Lindsey | Pantaleo | Schwabero | | Leadership and Strategy | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | ✔ | | Financial/Accounting | | ✔ | | | | ✔ | | ✔ | | ✔ | | Mergers and Acquisitions | ✔ | | ✔ | | | ✔ | ✔ | ✔ | ✔ | ✔ | | Cybersecurity/IT Systems | | ✔ | ✔ | | | ✔ | | ✔ | | ✔ | | International Business | | | ✔ | | | ✔ | ✔ | ✔ | ✔ | ✔ | | Technology/Innovation | ✔ | | ✔ | | ✔ | ✔ | ✔ | | ✔ | ✔ | | Industry Experience | ✔ | | ✔ | ✔ | ✔ | ✔ | | | | ✔ | | Public Company Board Service | ✔ | | | ✔ | ✔ | ✔ | ✔ | ✔ | | ✔ | | Manufacturing/Operations | ✔ | | | | ✔ | ✔ | ✔ | | ✔ | ✔ |
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION We use a combination of cash and common stock to compensate our non-employee directors. For fiscal 2024, our non-employee directors received an annual cash retainer, meeting fees and an annual stock award with immediate vesting. Our Chairman, Vice-Chairman, Committee Chairs and members of our Nominating and Governance Committee received additional cash retainers for their service in fiscal 2024. The Nominating and Governance Committee oversees and makes recommendations to the Board regarding our non-employee director compensation program. Non-employee directors can defer receipt of all or a portion of their cash or equity compensation to our Deferred Compensation Plan. For a description of the Deferred Compensation Plan, please see “Executive Compensation — Nonqualified Deferred Compensation,” below. Upon the recommendation of our Nominating and Governance Committee, the Board approved changes to our compensation program for non-employee directors for fiscal 2024. In reviewing our director compensation program, the Nominating and Governance Committee and the Board considered peer and market data, as well as the advice and recommendations of Frederic W. Cook & Co., Inc., our independent compensation consultant. For fiscal 2024, the Board increased the annual cash retainer for our Chairman of the Board from $80,000 to $95,000, and increased the annual cash retainer for the Chair of the Nominating and Governance Committee from $12,000 to $20,000. In addition, the Board approved a cash retainer of $12,000 for members of the Nominating and Governance Committee and the Chair of the Compensation Committee related to chief executive officer recruitment efforts. The following table shows the non-employee director compensation components and amounts for fiscal 2024.
DIRECTOR COMPENSATION
| Compensation Component | | Amount | | Annual Cash Retainer | | $80,000 | | Additional Annual Cash Retainer for the Chairman | | $95,000 | | Additional Annual Cash Retainer for the Vice Chairman | | $12,000 | | Additional Annual Cash Retainer for the Committee Chairs | | | | • | Audit Committee | $24,000 | | • | Compensation Committee | $24,000 | | • | Nominating and Governance Committee | $20,000 | | • | Technology Committee | $12,000 | | • | Medical Products Committee* | $12,000 | | Special Cash Retainer for the Nominating and Governance Committee and Compensation Committee Chair | | $12,000 | | Fee for Each Committee and Special Board Meeting | | $1,500 | | Annual Stock Grant | | Shares valued at $140,000 |
DIRECTOR COMPENSATION
| * In September 2023, upon the recommendation of our Nominating and Governance Committee, the Board approved the dissolution of our Medical Products Committee in connection with the discontinuation of our medical device business. |
DIRECTOR COMPENSATION
The following table sets forth certain information regarding compensation earned by the non-employee directors during our fiscal year ended April 27, 2024.
DIRECTOR COMPENSATION
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | | Walter J. Aspatore | $223,000 | $140,019 | $363,019 | | David P. Blom | $111,500 | $140,019 | $251,519 | | Therese M. Bobek | $125,000 | $140,019 | $265,019 | | Brian J. Cadwallader | $148,000 | $140,019 | $288,019 | | Bruce K. Crowther | $146,000 | $140,019 | $286,019 | | Darren M. Dawson | $126,500 | $140,019 | $266,519 | | Janie Goddard | $107,000 | $140,019 | $247,019 | | Mary A. Lindsey | $132,500 | $140,019 | $272,519 | | Angelo V. Pantaleo | $104,000 | $140,019 | $244,019 | | Mark D. Schwabero | $125,000 | $140,019 | $265,019 | | Lawrence B. Skatoff(2) | $58,000 | $140,019 | $198,019 |
DIRECTOR COMPENSATION
| (1) The reported amounts reflect the fair value at the date of grant calculated in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718. Details of the assumptions used in valuing these awards are set forth in Note 13 to our audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended April 27, 2024. |
DIRECTOR COMPENSATION
| (2) Mr. Skatoff did not stand for re-election at the Company’s Annual Meeting in September 2023. |
Directors and Executive Officers
Directors and Executive Officers The following table sets forth information regarding our common stock beneficially owned as of July 15, 2024, by (i) each director and nominee, (ii) each of the named executive officers, and (iii) all current directors and executive officers as a group.
Directors and Executive Officers
| Name of Beneficial Owner | Amount and Nature of Beneficial Ownership(1) | Percent of Class (%) | | Walter J. Aspatore | 44,661 (2)(3) | * | | David P. Blom | 28,211 | * | | Therese M. Bobek | 28,661(4) | * | | Brian J. Cadwallader | 32,461(3) | * | | Bruce K. Crowther | 32,111(5) | * | | Darren M. Dawson | 32,161(3) | * | | Jonathan B. DeGaynor | 0 | * | | Janie Goddard | 25,496(6) | * | | Mary A. Lindsey | 28,661(7) | * | | Angelo V. Pantaleo | 28,211 | * | | Mark D. Schwabero | 31,661(3) | * | | Avinash Avula | 0 | * | | Donald W. Duda | 1,138,651(8) | 3.2 | | Andrea J. Barry | 92,857(9) | * | | Kevin M. Martin | 75,014(10) | * | | Anil Shetty | 95,196(11) | * | | Ronald L.G. Tsoumas | 193,817(12) | * | | All current directors and executive officers as a group (14 persons) | 494,371(13) | * |
Directors and Executive Officers
| * Percentage represents less than 1% of the total shares of common stock outstanding. |
Directors and Executive Officers
| (1) Beneficial ownership arises from sole voting and dispositive power unless otherwise indicated by footnote. |
Directors and Executive Officers
| (2) Includes 19,000 shares held jointly with Mr. Aspatore’s wife. |
Directors and Executive Officers
| (3) Includes 25,661shares of phantom stock held in the Company’s Deferred Compensation Plan. |
Directors and Executive Officers
| (4) Includes 25,661shares of phantom stock held in the Company’s Deferred Compensation Plan and 3,000 share held in a trust pursuant to which Ms. Bobek shares voting and investment power with her spouse |
Directors and Executive Officers
| (5) Shares are held in a trust pursuant to which Mr. Crowther shares voting and investment power with his spouse. |
Directors and Executive Officers
| (6) Includes 22,541 shares of phantom stock held in the Company’s Deferred Compensation Plan. |
Directors and Executive Officers
| (7) Includes 11,491 shares of phantom stock held in the Company’s Deferred Compensation Plan. |
Directors and Executive Officers
| (8) Includes 677,555 shares of vested restricted stock units for which common stock will be delivered to Mr. Duda on the first day of the seventh month beginning after his separation of service from the Company and 375,000 shares of performance-based restricted stock subject to forfeiture. |
Directors and Executive Officers
| (9) Includes 52,500 shares of performance-based restricted stock subject to forfeiture and 4,550 shares of common stock held in our 401(k) Plan. |
Directors and Executive Officers
| (10) Includes 50,500 shares of performance-based restricted stock subject to forfeiture and 2,908 shares of common stock held in our 401(k) Plan. |
Directors and Executive Officers
| (11) Includes 27,196 shares held jointly with Mr. Shetty’s wife and 68,000 shares of performance-based restricted stock subject to forfeiture. |
Directors and Executive Officers
| (12) Includes 60,875 shares of vested restricted stock units for which common stock will be delivered to Mr. Tsoumas on the first day of the seventh month beginning after his separation of service from the Company, 75,500 shares of performance-based restricted stock subject to forfeiture and 21,343 shares of common stock held in our 401(k) Plan. |
Directors and Executive Officers
| (13) Includes 12,098 shares of performance-based restricted stock subject to forfeiture. |
PROPOSAL ONE
PROPOSAL ONE
ELECTION OF DIRECTORS
ELECTION OF DIRECTORS A Board of ten directors will be elected at the Annual Meeting. Each director will hold office until the next annual meeting of stockholders, or until any such director’s earlier resignation or until his or her successor is elected and qualified. All of the nominees listed below currently serve as directors. All nominees were recommended unanimously to our Board of Directors by our Nominating and Governance Committee and were nominated by our Board of Directors. If any nominee is unwilling or unable to serve as a director, an event which our Board does not anticipate, shares represented by the proxies will be voted for the election of another nominee nominated by our Board upon the recommendation of our Nominating and Governance Committee, or the Board may reduce the size of the Board and the number of directors to be elected at the Annual Meeting. Our Corporate Governance Guidelines provide that a director who does not receive a majority of the votes cast for his or her election in an uncontested election will promptly (and in any event within ten business days of the Annual Meeting) tender his or her resignation from the Board. At the option of the Board, the Nominating and Governance Committee may initially consider and recommend to the Board whether any such resignation should be accepted or rejected. The Board will make a decision to accept or reject any such resignation within 60 days of the Annual Meeting. The director tendering the resignation may not participate in the decisions of the Nominating and Governance Committee or the Board that concern his or her resignation or (unless three or fewer directors receive a majority vote) the resignation of any other director under the guidelines. Mr. Aspatore elected not to stand for re-election, and the Board expressed its great appreciation for his significant contributions to our Board and Company. The size of the Board will be reduced from eleven directors to ten directors as of the date of the Annual Meeting. OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF THE FOLLOWING NOMINEES.
Other Fiscal 2024 Compensation Decisions and Highlights
Pay Mix. A significant amount of our named executive officers’ compensation is “at risk” for non-payment if we fail or the executive fails to meet established performance targets. The following charts illustrate the components of fiscal 2024 compensation as a percentage of total target compensation for Mr. Avula, our Chief Executive Officer serving as of the end of fiscal 2024, and for our other named executive officers serving as of the end of fiscal 2024 as a group. For this purpose, total target compensation for Mr. Avula is the sum of his base salary, target annual performance-based cash bonus opportunity and one-fifth of the grant date fair value of the RSUs. Total target compensation for our other named executive officers is the sum of base salary, target annual performance-based cash bonus opportunity, one-fifth of the market value of the 2021 LTI Program RSAs as of the grant date and one-fifth of the grant date fair value of the RSUs. Performance Units are not included as they are only earned for above-target performance.
Objectives and Measurement Principles
| • | Provide executives with a competitive pay arrangement. |
Objectives and Measurement Principles
| • | Link short-term incentive opportunities to achievement of company objectives, including gross profit margin and individual objectives. |
Objectives and Measurement Principles
| • | Link long-term equity incentives to achievement of EBITDA objectives in line with the Company’s strategy. |
Objectives and Measurement Principles
| • | Align executive interests with stockholder interests by providing for capital accumulation through awards of RSAs and RSUs and encourage significant ownership of our common stock by our executive officers. |
Our Compensation Process
| • | assisted the Compensation Committee in developing a compensation peer group; |
Our Compensation Process
| • | provided and reviewed market data and advised the Compensation Committee on setting executive compensation and the competitiveness and reasonableness of the Company’s executive compensation program, including the former CEO and CFO transition agreements; |
Our Compensation Process
| • | provided information regarding realizable pay in light of our multi-year LTI Programs; |
Our Compensation Process
| • | The Compensation Committee is independent and utilizes an independent compensation consultant. |
Our Compensation Process
| • | Compensation for our executive officers represents a balanced mix of short-term, long-term and at-risk compensation. |
Our Compensation Process
| • | Our short-term incentive programs are designed to avoid an over emphasis on a single performance metric. |
Our Compensation Process
| • | The maximum amount payable under the annual performance-based bonuses is capped at 200% of target. |
Our Compensation Process
| • | A significant component of our LTI Programs is comprised of equity awards in order to directly align the interests of our executive officers with those of our stockholders. |
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation We strive to provide compensation opportunities that are market competitive. In order to promote this objective for fiscal 2024, the Compensation Committee retained FW Cook to conduct a review of our executive compensation peer group and benchmark our executive compensation program using a custom peer group and third-party survey data. The Compensation Committee considers this benchmarking information in reviewing each component of our compensation program. The peer group used for benchmarking purposes in setting fiscal 2024 compensation was selected using the following criteria:
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
| • | Size as measured by revenue – we generally targeted companies with revenue one-third to three times our annual revenue. |
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
| • | Size as measured by market capitalization – we generally targeted companies with market capitalization one-fourth to four times our market capitalization. |
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
| • | Similar-type businesses – we generally targeted companies that are multinational, compete against us for talent and engage in businesses with similar technology, products and markets. |
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
After considering the advice of FW Cook and the Committee’s criteria for the peer group, the Compensation Committee approved using the fiscal 2023 peer group without modification for fiscal 2024. For compensation decisions affecting fiscal 2024 compensation, the peer group included the following companies:
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
| Belden Corporation | Franklin Electric Company. Inc | Patrick Industries, Inc. | | Benchmark Electronics, Inc. | Gentherm Incorporated | Rogers Corporation | | Cooper-Standard Holdings Inc | LCI Industries | Stoneridge, Inc. | | CTS Corporation | Littelfuse, Inc. | TTM Technologies, Inc. | | Fabrinet | OSI Systems, Inc. | Visteon Corporation |
Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation
For fiscal 2025 compensation decisions, the Compensation Committee has revised the peer group by removing LCI Industries, Patrick Industries, Inc., and Visteon Corporation and adding Kimball Electronics, Inc., Knowles Corporation, and Modine Manufacturing Company, which align more closely to Methode in terms of revenue size and type of business. In benchmarking our compensation program for fiscal 2024, the Compensation Committee also reviewed information compiled by FW Cook from major third-party executive pay surveys. As a general policy, we targeted fiscal 2024 executive officer total compensation (salary, annual performance-based bonus, and long-term incentive compensation), within the median range of competitive practice. Generally, we aim to target the median of the peer group +/-20% depending on key factors, including the tenure and experience of the individual executive. In making benchmarking determinations for fiscal 2024 compensation, the analysis assumed that each executive would achieve the target level of performance under the annual performance-based bonuses and the long-term RSA awards. In valuing the RSA and RSU awards outstanding under the 2021 LTI Program, the Compensation Committee included one-fifth of the market value of the RSA’s as of the grant date and one-fifth of the grant date fair value of the RSUs. Performance Units are not included as they are only earned for above-target performance and the Retention Awards are not included as they are tied to the CEO transition period and are not expected to be recurring. In setting each compensation component for our executive officers, the Compensation Committee considered the competitive market data, together with other relevant factors, including the individual performance, experience and strategic value of each executive, retention and recruitment issues, internal pay equity and consistency issues, the Company’s performance, expected future contributions of each executive, historical compensation levels, tenure, promotions, and industry conditions. In addition, the Compensation Committee considered Mr. Duda’s longevity and extensive service to the Company as our Chief Executive Officer for approximately twenty years and his significant accomplishments. These and other factors may affect whether one or more of the compensation components for any of our executive officers is set above or below the median of competitive practice. In addition, annual performance-based bonus and long-term incentive compensation for one or more of our executive officers could be above or below this target range depending on the amounts earned, if any, under the performance-based awards.
Components of Fiscal 2024 Compensation
| Component | Purpose | | Salary | Attract, retain and motivate highly qualified executives. | | Annual Performance-Based Bonuses | Reward contributions to the achievement of our short-term company objectives, and in certain cases, individual objectives. | | Retention Bonuses | Cash awards that seek to retain key executives during the new Chief Executive Officer search and onboarding process. | | LTI Program Awards | Focus the executive’s efforts on our long-term performance, encourage significant ownership of our common stock and assist in retention. | | Other Benefits and Perquisites | Provide competitive levels of health and welfare protection and retirement and savings programs. |
Components of Fiscal 2024 Compensation
Mr. Avula assumed the role of CEO on January 29, 2024 with a base salary of $800,000 in accordance with his Offer Letter. Annual Performance-Based Bonuses. Our named executive officers other than Mr. Avula were awarded annual performance-based cash bonus opportunities for fiscal 2024. In awarding these opportunities, our Compensation Committee considered the guideline benchmark target, the individual performance and experience of each executive, retention goals, internal pay equity and industry conditions. The Compensation Committee reviewed advice from FW Cook regarding market practices and considered Mr. Duda’s recommendations for officers other than himself. In setting the performance measures for each executive, our Compensation Committee considered, among other matters, the Company’s strategy, the fiscal 2024 operating budget and general economic conditions. After deliberation, the Compensation Committee set the target amount payable as a percentage of base salary as follows: Mr. Duda, 135% of salary; Mr. Tsoumas and Ms. Barry, 75% of salary; and Mr. Martin and Mr. Shetty, 66% of base salary. For all named executive officers, the threshold and maximum amounts payable were set at 50% and 200%, respectively, of the amount payable at the target level of performance, which aligns with competitive practice among our peer group. The target bonus for each of these named executive officers other than Mr. Martin was tied to achieving a gross profit margin as a percentage of net sales for the Company based on our fiscal 2024 operating budget. The Compensation Committee set the percentage of each of these named executive officer’s target bonus tied to achieving this performance measure as follows: Mr. Duda, Mr. Tsoumas and Mr. Shetty, 70% and Ms. Barry, 50%. The Company’s results were below the threshold level of performance and no amounts were earned for this performance measure. The remaining portion of the target bonus for these executives and Mr. Martin’s full target bonus was based on personal goals. Set forth below is an outline of the annual performance-based bonus opportunities and amounts for fiscal 2024.
Components of Fiscal 2024 Compensation
| Executive | Target Bonus | Performance Measures and Amounts Payable* | Bonus Earned | | Donald W. Duda | $1,392,390 | (1) Achieve an adjusted gross profit margin percentage of net sales of 22.5% (threshold), 23.1% (target), 23.5% (target plus 150%), and 24.3% (maximum), with $487,377, $974,673, $1,462,010, and $1,949,346 payable at threshold, target, target plus and maximum, respectively. The Company achieved adjusted gross profit margin percentage of net sales below the threshold level of performance. (2) Drive an organizational review of all business processes to identify those most critical to Methode’s business continuity. This review will identify critical processes and the critical roles that manage them, in order mitigate business risk. This will establish a framework that will enable the organization to perform a risk assessment of how likely critical talent is to leave and support future succession plans to mitigate retention risks. Threshold for this goal will be the completion of this process in Europe, target would be completion of Europe, Egypt and India, and maximum would be completion of Europe, Egypt, India and the United States. This goal will be considered complete when the critical processes and roles have been identified and presented to the Board of Directors. Amounts payable are $208,859, $417,717 and $835,434 at threshold, target and maximum, respectively. The Company completed this process in Europe, Egypt, India and the United States and Mr. Duda earned the maximum amount payable. | $835,434 |
Components of Fiscal 2024 Compensation
| Executive | Target Bonus | Performance Measures and Amounts Payable* | Bonus Earned | | Ronald L.G. Tsoumas | $374,740 | (1) Achieve an adjusted gross profit margin percentage of net sales of 22.5% (threshold), 23.1% (target), 23.5% (target plus 150%), and 24.3% (maximum), with $131,159, $262,318, $393,477, and $524,636 payable at threshold, target, target plus and maximum, respectively. The Company achieved adjusted gross profit margin percentage of net sales below the threshold level of performance. (2) Improve fiscal 2024 forecasting accuracy of adjusted pre-tax income by 7.5% (threshold), 10.0% (target), 12.5% (target plus 150%), and 15.0% (maximum), with $28,106, $56,211, $84,317, and $112,422 payable at threshold, target, target plus and maximum, respectively. The Company did not achieve the threshold level of performance. (3) Remediate the fiscal 2023 significant deficiency, material weakness and finance-related carryover deficiencies, perform a complete global review of the current SOX program, adopt a global SOX remediation plan and develop and communicate the controls worldwide. If the significant deficiency, material weakness and finance-related carryover deficiencies are remediated, then threshold for this goal will be completing the global review, remediation plan, and controls in Europe, Egypt, and India, target would be the completion of Europe, Egypt, India, and the United States, and maximum would be Europe, Egypt, India, the United States, Mexico and China, with $28,105, $56,211 and $112,422 payable at threshold, target, and maximum, respectively. Mr. Tsoumas did not meet the threshold level of performance. | $0 |
Components of Fiscal 2024 Compensation
| Executive | Target Bonus | Performance Measures and Amounts Payable* | Bonus Earned | | Andrea J. Barry | $424,875 | (1) Achieve an adjusted gross profit margin percentage of net sales of 22.5% (threshold), 23.1% (target), 23.5% (target plus 150%), and 24.3% (maximum), with $106,219, $212,438, $318,656, and $424,875 payable at threshold, target, target plus and maximum, respectively. The Company achieved adjusted gross profit margin percentage of net sales below the threshold level of performance. (2) Drive an organizational review of all business processes to identify those most critical to Methode’s business continuity. This review will identify critical processes and the critical roles that manage them, in order mitigate business risk. This will establish a framework that will enable the organization to perform a risk assessment of how likely critical talent is to leave and support future succession plans to mitigate retention risks. Threshold for this goal will be the completion of this process in Europe, target would be completion of Europe, Egypt and India, and maximum would be completion of Europe, Egypt, India and the United States. This goal will be considered complete when the critical processes and roles have been identified and presented to the Board of Directors. Amounts payable are $63,731, $127,463 and $254,925 at threshold, target and maximum, respectively. The Company completed this process in Europe, Egypt, India and the United States and Ms. Barry earned the maximum amount payable. (3) Achieve at least one of the following objectives: (a) design and present to the Compensation Committee a new Long-Term Incentive Plan on a global basis; and (b) complete the implementation of the Workday system for newly acquired Nordic Lights business. No bonus is earned if neither objective is achieved; the target bonus of $84,975 is earned if one of these objectives is achieved; and the maximum bonus of $169, 950 is earned if both objectives are achieved. Ms. Barry achieved both objectives and earned the maximum amount payable. | $424,875 |
Components of Fiscal 2024 Compensation
| Executive | Target Bonus | Performance Measures and Amounts Payable* | Bonus Earned | | Kevin M. Martin | $290,400 | (1) Secure new business bookings for North America with a minimum pre-tax margin of 18%. The performance levels for such new business were $112.0 million (threshold), $125.0 million (target) and $137.0 million (maximum), with $101,640, $203,280 and maximum $406,560 payable at threshold, target and maximum, respectively. The Company booked $153.8 million for such new business and Mr. Martin earned $406,560. (2) Achieve at least one of the following objectives: (a) establish a global EV product architecture core team to develop and implement product strategies designed to continue growth in power products and prepare global product roadmaps and recommendations for vertical integration; and (b) establish a global automotive, commercial vehicle and power sports product architecture core team to develop and implement product strategies for exterior lighting designed to continue growth in commercial vehicle and automotive and prepare global product roadmaps and recommendations for vertical integration. No bonus is earned if neither objective is achieved; the target bonus of $87,120 is earned if one of these objectives is achieved; and the maximum bonus of $174,240 is earned if both objectives are achieved. Mr. Martin achieved both objectives and earned the maximum amount payable of $174,240. | $580,800 | | Anil Shetty | $292,746 | (1) Achieve an adjusted gross profit margin percentage of net sales of 22.5% (threshold), 23.1% (target), 23.5% (target plus 150%), and 24.3% (maximum), with $102,461, $204,922, $307,384, and $409,844 payable at threshold, target, target plus and maximum, respectively. The Company achieved adjusted gross profit margin percentage of net sales below the threshold level of performance. (2) Develop a strategy and work with each business unit to identify specific “Purchase Price Reductions” on commodities and services to achieve global cost reductions of $15.0 million (threshold), $20.0 million (target), and $25.0 million (maximum) with $43,912, $87,824, and $175,648 payable at threshold, target, target plus and maximum, respectively. The Company identified $16.0 million in such cost savings and Mr. Shetty earned $53,118. | $53,118 |
Components of Fiscal 2024 Compensation
| * Payouts are interpolated for performance falling between established performance objectives. |
Components of Fiscal 2024 Compensation
In the first quarter of our fiscal 2025, following the completion of the fiscal 2024 performance period for the annual performance-based bonuses, and at the recommendation of our new Chief Executive Officer, the Compensation Committee offered Ms. Barry and Mr. Martin, the named executive officers who were employed by the Company at the time, along with certain other management team members, the opportunity to receive their annual performancebased awards in RSUs rather than cash, with the number of RSUs determined by reference to the closing price of our common stock on July 25, 2024, the deadline to make the election. RSU awards received in lieu of the cash bonuses will vest, subject to continued service, on March 7, 2025, or upon the recipient’s earlier death, disability, or termination of employment without cause. In making this decision, the Compensation Committee determined that providing an opportunity to receive equity upon settlement of the performance-based bonus program would, among other objectives, contribute to aligning executives with stockholder interests. Ms. Barry and Mr. Martin elected to receive their annual performance-based awards in the form of 32,734 RSUs and 44,746 RSUs, respectively. Fiscal 2024 Discretionary Bonus. In August 2023, the Compensation Committee awarded Mr. Shetty a discretionary bonus of $190,000 for successfully managing the closure of our Dabir medical device business in fiscal 2024. Retention Awards. In September 2023, after considering the need to incentivize retention and continuity of the executive leadership team through the CEO transition period, the Compensation Committee granted retention awards to certain of our named executive officers. These incentive awards were granted to these key executives as their retention is considered essential for the Company’s successful execution of the near- and longer-term financial and operational milestones, particularly during the new Chief Executive Officer search and subsequent onboarding process. Each executive is eligible to receive a cash incentive award if the executive remains employed by the Company and maintains satisfactory job performance through September 12, 2025. The table below sets forth details regarding the incentive awards to our named executive officers.
Components of Fiscal 2024 Compensation
| Named Executive Officer | Cash Incentive Award | | Ronald L.G. Tsoumas | $500,000 | | Andrea J. Barry | $750,000 | | Kevin M. Martin | $440,000 | | Anil Shetty | $445,000 |
Components of Fiscal 2024 Compensation
If the executive officer is terminated without cause, dies or becomes disabled prior to September 12, 2025, the executive officer (or his or her estate) is entitled to payment of the full incentive award. If the executive officer voluntarily terminates his or her employment for good reason following or during a period pending a change of control, the executive officer is entitled to payment of the full incentive award. The incentive awards will be forfeited in full, if the executive officer’s employment is terminated by the Company for cause, or if the executive terminates his or her employment for any reason, other than good reason following a change of control. Mr. Tsoumas’ retention award was forfeited upon his July 2024 retirement. Mr. Shetty’s retention award was paid to him in connection with the termination of his employment without cause on July 26, 2024. 2021 LTI Program. In September 2020, our Compensation Committee adopted a five-year, long-term incentive program (the “2021 LTI Program”) which consists of performance-based restricted stock awards (“RSAs”), cash-based performance grants (“Performance Units”) and time-based restricted stock units (“RSUs”). Because his employment commenced in January 2024, Mr. Avula did not participate in the 2021 LTI Program other than through a time-based RSU grant made to him upon commencement of his employment as described in more detail below. For participating executive officers other than Mr. Shetty, the number of RSAs and Performance Units earned will be based on the achievement of established goals for the Company’s earnings before net interest, taxes, fixed asset depreciation and intangible asset amortization (“EBITDA”) for fiscal 2025. For Mr. Shetty, performance targets were based on the fiscal 2025 EBITDA of our Dabir Surfaces subsidiary. The Performance Units represent an opportunity for the executives to receive a cash payment based on the price of our common stock only to the extent that fiscal 2025 EBITDA exceeds target performance for the RSAs. At the discretion of the Compensation Committee, the Performance Units may be settled in shares of our common stock. The RSUs are subject to a five-year vesting period based on continued service. After a comprehensive review of various design alternatives and market practices presented by the Compensation Committee’s independent executive compensation consultant, FW Cook, one of the critical determining factors the Compensation Committee considered in granting another five-year, long-term incentive program in fiscal 2021 was the performance of the two prior five-year, long-term incentive programs which concluded as of the end of fiscal 2015 and fiscal 2020, respectively. Consistent with our prior five-year programs, the Compensation Committee intended these RSAs, Performance Units and RSUs to be the only equity-based awards made to our executive officers participating in the plan during this new five-year period which ends on May 3, 2025, i.e., fiscal 2021 through fiscal 2025. The Compensation Committee believes that the opportunity offered to participating executives after the end of fiscal 2024 to convert existing performance-based cash awards, for which the performance period had ended, into RSUs as described above under “—Annual Performance-Based Bonuses”, is consistent with this approach. After careful consideration, the Compensation Committee determined that another five-year program was appropriate after reviewing our stockholders’ strong say-on-pay support of the prior programs, the success of the prior programs, as well as the lengthy sales and product development cycles and significant upfront capital requirements for many of the Company’s products. The Compensation Committee considered the potential risks of the 2021 LTI Program and concluded that it does not create risks that are reasonably likely to have a material adverse effect on the Company. The Compensation Committee believed the longer term would focus our executive officers on the Company’s strategic long-term objectives, including the EV market, assist in the retention of our top executive talent over the period in a highly competitive job market, and foster long-term strategic consistency, teamwork and collaboration among our executive officers. In establishing the program, the Compensation Committee believed the mix of 50% performance-based and 50% time-based awards at target performance supports the Company’s operating performance and retention objectives and is consistent with market practice. The Performance Units represent an opportunity for the executives to receive a cash payment based on the price of our common stock only to the extent that the fiscal 2025 EBITDA exceeds target performance for the RSAs in order to provide an additional stretch goal for outperformance. At the discretion of the Compensation Committee, the Performance Units may be settled in shares of our common stock. The Compensation Committee applied EBITDA, as adjusted, as the performance metric for the RSAs and the Performance Units because it is one of the primary operating metrics tracked by the Company and its stockholders. The target Company EBITDA performance goal set forth below aligns with the Company’s targeted EBITDA compound annual growth rate of approximately 8% for the five-year program period. Additionally, the inclusion of EBITDA from accretive acquisitions is in line with the Company’s plans to grow organically and inorganically over the period. The adjustments to EBITDA for acquisitions and divestitures were designed to mitigate unintended windfalls to management for non-accretive acquisitions and to safeguard management from unintended penalties for stockholder-friendly divestitures that negatively impact the fiscal 2025 performance results. For an acquisition to qualify as accretive in fiscal 2025, the EBITDA of the acquired business must exceed the interest expense for the related debt and the net impact on earnings per share must be positive. In general, the Compensation Committee targeted the 2021 LTI Program awards within the median range of competitive practice, as annualized over the five-year program period. In making these benchmarking determinations, the Compensation Committee assumed that each executive would achieve the target level of performance under the RSAs and included one-fifth of the market value of the RSA shares and RSUs in these comparative calculations. In determining the size of the award to each of our executive officers, the Compensation Committee also considered other relevant factors, including the individual performance and experience of each executive, internal pay equity and consistency issues, expected future contributions of each executive and historical compensation levels. For Mr. Duda, the Compensation Committee considered his longevity and extensive service to the Company as our Chief Executive Officer and his significant accomplishments. The table below sets forth details regarding the target awards to the named executive officers. Consistent with our prior five-year programs, the Compensation Committee intends the RSAs, RSUs and Performance Units to be the only equity-based awards made to our participating executive officers during the five-year period which ends on May 3, 2025, i.e., fiscal 2021 through fiscal 2025, excluding the opportunity to settle payments earned under our fiscal 2024 annual performance-based bonus program in RSUs as described above.
Components of Fiscal 2024 Compensation
| Executive | Number of Shares | | Grant Date Market Value | | | | Target RSAs | RSUs | Target RSAs | RSUs | | Donald W. Duda | 375,000 | 375,000 | $10,605,000 | $10,605,000 | | Ronald L.G. Tsoumas | 75,500 | 75,500 | $2,135,140 | $2,135,140 | | Andrea J. Barry | 52,500 | 52,500 | $1,484,700 | $1,484,700 | | Kevin M. Martin | 50,500 | 50,500 | $1,444,805 | $1,444,805 | | Anil Shetty | 68,000 | 34,000 | $1,923,040 | $961,520 |
Components of Fiscal 2024 Compensation
| Executive | Maximum Number of Performance Units* | | Donald W. Duda | 187,500 | | Ronald L.G. Tsoumas | 37,750 | | Andrea J. Barry | 26,250 | | Kevin M. Martin | 25,250 | | Anil Shetty | 23,000 |
Components of Fiscal 2024 Compensation
RSAs. For executive officers other than Mr. Shetty, the RSAs may be earned based on the Company’s fiscal 2025 performance relative to established goals for threshold and target EBITDA performance, subject to certain adjustments, including adjustments for non-accretive acquisitions and divestitures. The executives will not earn any shares of RSAs if threshold performance is not met. Performance will be based on Methode’s EBITDA for fiscal 2025, subject to certain adjustments, including adjustments for non-accretive acquisitions and divestitures. The performance goals and corresponding percentages of RSAs eligible to be earned by these executives are set forth below. The target EBITDA performance goal aligns with the Company’s targeted EBITDA compound annual growth rate of approximately 8% for the five-year program period.
Components of Fiscal 2024 Compensation
| * Payouts are interpolated for performance falling between the threshold and target performance measures. |
Components of Fiscal 2024 Compensation
For Mr. Shetty, performance targets were based on the fiscal 2025 EBITDA of our Dabir Surfaces subsidiary. With the discontinuation of the Dabir business in fiscal 2024, Mr. Shetty is no longer eligible to earn any RSAs based on Dabir’s fiscal 2025 EBITDA. As noted above, Mr. Shetty received a discretionary bonus during fiscal year 2024 for successfully managing the closure of our Dabir medical device business during the year. Dividends will not be paid on the RSAs until the shares have been earned. At such time, the executives will be entitled to a dividend equivalent payment based on the dividends declared during the restricted period and the number of shares earned, if any. In the event of an executive’s death or disability, the executive will earn all the RSA shares. In general, in the event of the qualified retirement of an executive, or in the event of a termination without cause in the case of Ms. Barry, the executive will be eligible to earn a prorated number of RSA shares based on the number of months elapsed since May 2, 2020 and the Company’s fiscal 2025 EBITDA. With Mr. Duda’s retirement, he remains eligible to earn all the RSA shares subject to achievement of the applicable EBITDA performance metrics for fiscal 2025. With Mr. Tsoumas’ retirement, he remains eligible to earn a pro rata portion of the RSA shares subject to achievement of the applicable EBITDA performance metrics for fiscal 2025. In the event of a change of control of the Company in which either (i) the successor company does not assume or replace the RSAs or (ii) the successor company assumes or replaces the RSAs, and the executive is terminated without cause or resigns for good reason within the next two years, the executive will earn a prorated number of RSA shares. The award agreements for Messrs. Duda, Martin and Shetty provide that proration will be based on the number of months elapsed since the start of fiscal 2021. For Mr. Tsoumas and Ms. Barry, if the change of control or termination occurs in fiscal 2024 or 2025, the proration would be 100%. In the event an executive enters into any of certain enumerated prohibited activities, all of such executive’s RSAs unvested at the time of such activity are subject to forfeiture. In accordance with the accounting and SEC disclosure rules, the “Stock Awards” column of the Summary Compensation Table in the Company’s proxy statements covering fiscal year 2021 compensation did not include any value attributable to the RSAs for fiscal 2021, the year in which they were granted. For financial statement reporting purposes and based on the accounting rules, the Company will not record an expense for the RSAs until the Company determines with sufficient certainty that at least the threshold level of performance for fiscal 2025 EBITDA will be achieved. As noted above, the fiscal 2025 EBITDA target performance goal aligns with the Company’s targeted EBITDA compound annual growth rate of approximately 8% for organic and inorganic growth during the five-year program period and includes EBITDA from accretive acquisitions. Performance Units. If the Company’s fiscal 2025 EBITDA exceeds target performance, the executives other than Mr. Shetty will be eligible to earn Performance Units based on performance relative to goals for target and maximum performance. The performance goals and corresponding percentages of Performance Units eligible to be earned by the executives are set forth below.
Components of Fiscal 2024 Compensation
| Performance Goal | Fiscal 2025 EBITDA, As Adjusted | Percentage of Performance Units Earned* | | Target Performance | $300 million | 0% | | Maximum Performance | $330 million | 100% |
Components of Fiscal 2024 Compensation
| * Payouts are interpolated for performance falling between the target and maximum performance measures. |
Components of Fiscal 2024 Compensation
Severance Agreements. In January 2024, we entered into a Severance Agreement with Mr. Avula that provided certain benefits if he were terminated without cause. In such event, he would have been entitled to receive a severance payment equal to two times the sum of (i) his annualized salary in effect at the time of the termination plus (ii) his target bonus amount for the fiscal year in which the termination occurs, paid over a two year period in equal installments. In addition, Mr. Avula would have been entitled to (a) an amount equal to a pro rata portion (based on the number of days in the fiscal year through the date of termination) of the actual bonus payment he would have received for the fiscal year had he remained employed, and (b) the Company portion of COBRA premiums actually paid by Mr. Avula for up to 18 months (or if earlier, the date he becomes eligible for coverage under another employer’s group health plan). Subsequent to the end of our fiscal year 2024, upon the commencement of employment of Jonathan DeGaynor as our President and Chief Executive Officer on July 15, 2024, we entered into a severance agreement with Mr. DeGaynor on terms substantially similar to those that had been provided to Mr. Avula as described above. Additional information about these severance arrangements is provided below under “Executive Compensation − Potential Payments Upon Termination or Change of Control.”
Summary Compensation Table
Summary Compensation Table The following table sets forth certain summary information regarding the compensation awarded to, earned by or paid by us to, or for the account of, our two former Chief Executive Officers who served during fiscal 2024, our former Chief Financial Officer who retired after the end of fiscal 2024 and our three other most highly compensated executive officers (the “named executive officers”) for fiscal 2024. On January 29, 2024, Mr. Avula replaced Mr. Duda as President and Chief Executive Officer. Mr. Duda retired from the Company on April 30, 2024, Mr. Avula resigned from the Company on May 1, 2024, Mr. Tsoumas retired as our Chief Financial Officer on July 12, 2024 and Mr. Shetty’s last day of employment was July 26, 2024, in each case after the end of fiscal 2024. Information regarding fiscal 2023 and 2022 is omitted for Mr. Shetty because he was not a named executive officer during either year.
Summary Compensation Table
| Name and Principal Position | Fiscal Year | Salary ($)(1) | Bonus ($)(2) | Stock Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | | Avinash Avula Former President and Chief Executive Officer | 2024 | 200,000 | 263,000 | 3,125,000 | — | 429,227 | 4,017,227 | | Ronald L.G. Tsoumas, Former Chief Financial Officer | 2024 | 499,653 | — | — | 0 | 86,980 | 586,633 | | | 2023 | 475,860 | 473,970 | — | 214,200 | 73,846 | 1,237,846 | | | 2022 | 453,200 | 248,000 | — | 101,970 | 40,254 | 843,424 | | Andrea J. Barry Chief Administrative Officer | 2024 | 566,500 | — | — | 424,875 | 43,591 | 1,034,966 | | | 2023 | 515,000 | 276,000 | — | 231,750 | 39,379 | 1,062,130 | | | 2022 | 431,346 | 184,000 | — | 209,250 | 10,373 | 834,969 | | Kevin M. Martin Vice President, North America | 2024 | 440,000 | — | — | 580,800 | 52,172 | 1,072,972 | | | 2023 | 400,000 | 219,000 | — | 264,000 | 43,238 | 926,238 | | | 2022 | 363,000 | 146,000 | — | 209,250 | 20,546 | 825,733 | | Anil Shetty Former Vice President | 2024 | 444,000 | 190,000 | — | 53,118 | 40,014 | 727,132 | | Donald W. Duda Former President and Chief Executive Officer | 2024 | 1,031,400 | — | — | 835,434 | 339,213 | 2,206,047 | | | 2023 | 955,000 | 942,000 | — | 773,550 | 417,536 | 3,088,086 | | | 2022 | 782,800 | 628,000 | — | 634,068 | 252,908 | 2,297,776 |
Summary Compensation Table
| (1) The annual base salaries for our named executive officers as of the end of fiscal 2024 were as follows: Mr. Avula, $800,000, Mr. Tsoumas, $499,653; Ms. Barry, $566,500; Mr. Martin, $440,000; Mr. Shetty, $444,000; and Mr. Duda, $1,031,400. For Mr. Duda, this amount includes approximately three months of salary as Executive Advisor at the same salary level following his resignation as Chief Executive Officer on January 29, 2024. |
Summary Compensation Table
| (2) For Mr. Avula, reflects a sign-on bonus of $263,000. Following his resignation, Mr. Avula is obligated to repay the Company this bonus. For Mr. Shetty, reflects a bonus of $190,000 for successfully managing the closure of our Dabir medical device business. See “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Fiscal 2024 Discretionary Bonus” and “–Executive Officer Transitions – Avinash Avula Service as Chief Executive Officer” for additional details. |
Summary Compensation Table
| (3) Includes the grant date fair value of the time-based RSU awards to Mr. Avula in accordance with his Offer Letter determined in accordance with Accounting Standards Codification Topic 718, Stock Compensation (“ASC 718”). Details of the assumptions used in valuing the awards are set forth in the footnotes to our audited financial statements included in our Annual Report on Form 10-K. The RSUs were subject to a five-year vesting period based on continued service with 20% of the RSUs vesting as of the first five anniversary dates of the grant date. Additional details regarding this award are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Mr. Avula RSU Award.” Mr. Avula forfeited these RSUs upon his resignation. The grant date fair values of outstanding equity awards under the 2021 LTI Program were reflected in the Company’s prior proxy statements for which fiscal 2021 compensation was reported for our named executive officers at the time. |
Summary Compensation Table
| (4) Amounts reflect annual performance-based cash bonuses for fiscal 2024. Additional details regarding these bonus awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Annual Performance-Based Bonuses.” As noted therein, Ms. Barry and Mr. Martin elected to receive their respective awards in RSUs in lieu of cash. |
Summary Compensation Table
| (5) Amounts included in All Other Compensation reflect the following for fiscal 2024: |
Summary Compensation Table
| Executive | Vested RSU Dividend Equivalents ($) | 401(k) Contribution ($) | Life Insurance ($) | Car Allowance ($) | | Mr. Avula | 0 | 10,350 | 0 | 0 | | Mr. Tsoumas | 69,047 | 10,350 | 1,584 | 6,000 | | Ms. Barry | 31,658 | 10,350 | 1,584 | 0 | | Mr. Martin | 30,452 | 10,350 | 571 | 10,800 | | Mr. Shetty | 13,869 | 10,350 | 994 | 10,800 | | Mr. Duda | 232,431 | 10,350 | 3,048 | 9,600 |
Summary Compensation Table
For Mr. Avula, All Other Compensation also includes $400,000 of reimbursements for the repayment of relocation allowances to Mr. Avula’s former employer, a $10,000 relocation allowance, and the aggregate incremental cost to the Company of $7,353 and $1,524 for use of the Company-owned condominium in Chicago, Illinois and Company-owned car, respectively, in connection with his relocation. Following his resignation, Mr. Avula is obligated to repay the Company the $400,000 for the repayment of relocation allowances. For Mr. Duda, All Other Compensation also includes $79,338 of vacation payout and $4,445 for an executive physical.
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table sets forth certain information regarding grants of plan-based awards to the named executive officers during the fiscal year ended April 27, 2024.
Grants of Plan-Based Awards
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | All Other Stock Awards: Number of Shares of Stock or Units(2) | Grant Date Fair Value of Stock and Option Awards ($)(3) | | | | Threshold ($) | Target ($) | Maximum ($) | | | | Avinash Avula | 12/18/2023 | — | — | — | 144,877 | 3,125,000 | | Ronald L.G. Tsoumas | 7/5/2023 | 187,370 | 374,740 | 729,480 | — | — | | Andrea J. Barry | 7/5/2023 | 254,925 | 424,875 | 849,750 | — | — | | Kevin M. Martin | 7/5/2023 | 101,640 | 290,400 | 580,800 | — | — | | Anil Shetty | 7/5/2023 | 146,373 | 292,746 | 585,492 | — | — | | Donald W. Duda | 7/5/2023 | 696,236 | 1,392,390 | 2,784,780 | — | — |
Grants of Plan-Based Awards
| (1) Reflects the annual performance-based cash bonus awards. Amounts earned in fiscal 2024 by the executive officers under this award are reported in the column titled “Non-Equity Incentive Plan Compensation” in the “Summary Compensation Table.” Additional details regarding these bonus awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Annual Performance-Based Bonuses.” As noted in that discussion, Ms. Barry and Mr. Martin, the named executive officers who were employed by the Company in July 2024, were offered the option of settlement in cash or in RSUs. |
Grants of Plan-Based Awards
| (2) Reflects time-based RSUs awarded to Mr. Avula in accordance with his Offer Letter. Additional detail regarding this award is set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Mr. Avula RSU Award.” Mr. Avula forfeited the RSUs upon his resignation. |
Grants of Plan-Based Awards
| (3) Amount shown reflects the grant date fair value of the RSU award determined in accordance with ASC 718. Details of the assumptions used in valuing the awards are set forth in the footnotes to our audited financial statements included in our Annual Report on Form 10-K for such fiscal year. Mr. Avula forfeited the RSUs upon his resignation. |
Grants of Plan-Based Awards
As discussed in the Compensation Discussion and Analysis, during fiscal 2024, each of our named executive officers other than Mr. Avula was awarded an annual performance-based bonus opportunity. The target amount payable was set at 135% of base salary for Mr. Duda, 75% for Mr. Tsoumas and Ms. Barry, and 66% for Mr. Martin and Mr. Shetty. The threshold and maximum amounts payable were set at 50% and 200%, respectively, of the amount payable at the target level of performance. The amounts paid to the named executive officers pursuant to these awards are included in the Summary Compensation Table under the column captioned “Non-Equity Incentive Plan Compensation.” Please see “Components of Fiscal 2024 Compensation – Annual Performance-Based Bonuses” in the Compensation Discussion and Analysis above for further information regarding these awards.
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table sets forth certain information regarding the outstanding equity awards of the named executive officers at April 27, 2024.
Outstanding Equity Awards at Fiscal Year-End
| | Option Awards(1) | | | | 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 Share of Units of Stock That Have Not Vested ($)(4) | Equity Incentive Plan Awards: Numbers of Unearned Shares, Units or Other Rights That Have Not Yet Vested (#)(5) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Yet Vested ($)(4) | | Avinash Avula | — | — | — | — | 144,877(2) | 1,770,397 | — | — | | Donald W. Duda | — | — | — | — | 150,000(3) | 1,833,000 | 187,500 | 2,291,250 | | Ronald L.G. Tsoumas | 8,000(1) | 0 | 37.01 | 7/7/2024 | 30,000(3) | 366,600 | 37,750 | 461,305 | | Andrea J. Barry | — | — | — | — | 21,000(3) | 256,620 | 26,250 | 320,775 | | Kevin M. Martin | — | — | — | — | 20,200(3) | 246,844 | 25,250 | 308,555 | | Anil Shetty | — | — | — | — | 13,600(3) | 166,192 | 34,000 | 415,480 |
Outstanding Equity Awards at Fiscal Year-End
| (1) These options were granted in July 2014. One-third of these options vested on each of the first, second and third anniversaries of the grant date. These options expired unexercised on July 7, 2024. |
Outstanding Equity Awards at Fiscal Year-End
| (2) The RSUs were subject to a five-year vesting period based on continued service with 20% vesting as of the first five anniversary dates of the grant date ending January 29, 2029. Additional detail regarding this award is set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – Mr. Avula RSU Award.” Mr. Avula forfeited these RSUs upon his resignation. |
Outstanding Equity Awards at Fiscal Year-End
| (3) These RSUs are scheduled to vest at the end of fiscal 2025, subject to continued service conditions and accelerated vesting in the event of qualified retirement. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – 2021 LTI Program.” |
Outstanding Equity Awards at Fiscal Year-End
| (4) Calculated based on the closing price of the Company’s common stock on April 26, 2024 of $12.22 per share. |
Outstanding Equity Awards at Fiscal Year-End
| (5) These RSAs are eligible for vesting based on fiscal 2025 EBITDA, as adjusted, relative to established goals for threshold and target performance Additional details regarding these awards and the 2025 performance levels required in order for threshold payments to be made are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2024 Compensation – 2021 LTI Program.” Amounts reflect the number of shares earned at threshold performance. |
Option Exercises and Stock Vested
Option Exercises and Stock Vested The following table sets forth certain information regarding the vesting of restricted stock units during fiscal 2024.
Option Exercises and Stock Vested
| Name | Stock Awards | | | | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | Avinash Avula | 0 | 0 | | Ronald L.G. Tsoumas | 22,650 | 276,783 | | Andrea J. Barry | 15,750 | 192,465 | | Kevin M. Martin | 15,150 | 185,133 | | Anil Shetty | 10,200 | 124,644 | | Donald W. Duda | 112,500 | 1,372,500 |
Option Exercises and Stock Vested
| (1) Reflects the portion of time-based RSUs awarded pursuant to our 2021 LTI Program that vested on April 27, 2024. |
Option Exercises and Stock Vested
| (2) Calculated based on the closing price of Methode’s common stock on April 26, 2024 of $12.22 per share. |
Nonqualified Deferred Compensation
Nonqualified Deferred Compensation The following table sets forth certain information regarding deferred compensation with respect to the named executive officers for fiscal 2024.
Nonqualified Deferred Compensation
| Name | Executive Contributions in Last Fiscal Year ($)(1) | Registrant Contributions in Last Fiscal Year ($) | Aggregate Earnings in Last Fiscal Year ($) | Aggregate Withdrawals/ Distributions ($)(2) | Aggregate Balance at Last Fiscal Year-End ($) | | Avinash Avula | 0 | 0 | 0 | 0 | 0 | | Ronald L.G. Tsoumas | 209,166 | 0 | 76,375 | 232,378 | 1,621,758 | | Andrea J. Barry | 323,857 | 0 | 126,662 | 0 | 1,566,283 | | Kevin M. Martin | 0 | 0 | 0 | 0 | 0 | | Anil Shetty | 161,943 | 0 | 127,135 | 0 | 880,355 | | Donald W. Duda | 0 | 0 | 1,523 | 0 | 34,924 |
Nonqualified Deferred Compensation
| (1) All executive contributions were reported as compensation in the “Summary Compensation Table” under the “Salary” and/or “Non-Equity Incentive Plan Compensation” columns, depending on the source of the executive contribution. |
Nonqualified Deferred Compensation
| (2) Reflects distributions in accordance with the terms of each executive’s deferral election. |
Nonqualified Deferred Compensation
The Methode Electronics, Inc. Nonqualified Deferred Compensation Plan (the “Deferred Compensation Plan”) allows a select group of management and highly compensated employees to defer up to 75% of their annual base salary and/or 100% of their annual bonus, with an aggregate minimum deferral of $3,000. Directors are allowed to defer up to 100% of their director compensation paid in cash or shares of common stock. The minimum period of deferral is three years. Participants are immediately 100% vested. In addition to directed deferrals, we may make contributions to the Deferred Compensation Plan to make up for limits applicable under our qualified plans and may make additional discretionary contributions as well. Participants vest in company contributions in accordance with the schedule set forth in the applicable agreement or plan governing such contributions. We made no contributions to the Deferred Compensation Plan in fiscal 2024. Participants may elect from a list of certain mutual funds to determine any amounts credited or debited from their accounts, although we are under no obligation to invest the deferred amounts in any specified fund. This list is made available to all participants and account balances are credited or debited based on the current market rates for these funds. Participants may reallocate account balances and/or future deferrals daily. Participants are entitled to receive a distribution from their account balances at the earlier of the end of the elected deferral period or retirement, disability, termination of employment or a change of control. Accounts are distributed in a lump sum or, in certain circumstances, in installments over a period of up to 15 years. Participants can also petition the Compensation Committee to receive a full or partial payout from the Deferred Compensation Plan in the event of an unforeseeable financial emergency.
Potential Payments Upon Termination or Change of Control
Potential Payments Upon Termination or Change of Control In the event our named executive officers are terminated or Methode undergoes a change of control, our named executive officers are entitled to certain payments under their change of control agreements, severance agreements and certain other benefit plans. All of our named executive officers are parties to change of control agreements with the Company. Pursuant to these change of control agreements, if within two years of a change of control or during a period pending a change of control, we terminate the executive’s employment without good cause or the executive voluntarily terminates his or her employment for good reason, the executive is entitled to the following:
Potential Payments Upon Termination or Change of Control
| • | a lump sum payment in an amount equal to a multiple of the executive’s base salary (three times for our Chief Executive Officer and two times for our other named executive officers); |
Potential Payments Upon Termination or Change of Control
| • | a lump sum payment equal to a multiple (three times for our Chief Executive Officers and two times for our other named executive officers) of the executive’s target bonus amount for the fiscal year in which the termination occurs; and |
Potential Payments Upon Termination or Change of Control
| • | continued participation in our welfare benefit plans for three years for our Chief Executive Officer and two years for our other named executive officers, or until the executive becomes covered under other welfare benefit plans providing substantially similar benefits. |
Potential Payments Upon Termination or Change of Control
Additionally, in the event of a change of control or the executive’s death, disability, qualified retirement, or termination without cause, all our named executive officers are entitled to certain payments under their LTI awards, annual performance-based bonus awards, and retention awards, as applicable. In January 2024, we entered into a Severance Agreement with Mr. Avula that would have provided certain benefits upon his termination without cause. In such event, Mr. Avula would have been entitled to receive a severance payment equal to two times the sum of (i) his annualized salary in effect at the time of the termination plus (ii) his target bonus amount for the fiscal year in which the termination occurs, paid over a two year period in equal installments. In addition, Mr. Avula would have been entitled to (a) an amount equal to a pro rata portion (based on the number of days in the fiscal year through the date of termination) of the actual bonus payment he would have received for the fiscal year had he remained employed, and (b) the Company portion of COBRA premiums actually paid by Mr. Avula for up to 18 months. Subsequent to the end of our fiscal year 2024, upon the commencement of employment of Jonathan DeGaynor as our President and Chief Executive Officer on July 15, 2024, we entered into a severance agreement with Mr. DeGaynor on terms substantially similar to those that had been provided to Mr. Avula as described above. In addition to the salary, bonus and benefits arrangements described above, the following table summarizes compensation payable to our named executive officers upon these various scenarios under our equity and non-equity incentive plans in place at fiscal year end. The amounts payable under the “Change in Control” column are due if (i) the successor company does not assume the awards or (ii) the successor company assumes the awards and then the executive is terminated without cause or resigns for good reason. In each scenario in which the RSA shares and/or the RSUs vest, the executive is entitled to a payment based on the dividends declared during the vesting period and the number of shares or units vested.
Potential Payments Upon Termination or Change of Control
| | Scenario | | | | | Type of Award | Change in Control | Death or Disability | Termination Without Cause | Retirement(1) | | Annual Performance-Based Bonus | The target bonus is paid. | The target bonus is paid. | Mr. Avula’s severance agreement provided for a prorated bonus. For all other named executive officers, no bonus is paid. | A prorated bonus is paid based on the retirement date and year-end performance. | | Retention Awards | Following any change in control, if an executive is terminated without cause or resigns for good reason, the full award will be paid. | The full award will be paid. | The full award will be paid. | The full award is forfeited. | | Restricted Stock Units (“RSUs”) | All RSUs are fully vested. | All RSUs are fully vested. | If Mr. Duda, Mr. Tsoumas or Ms. Barry are terminated, a prorated number of RSUs will vest based on the number of months elapsed since the start of fiscal 2021. | If Mr. Tsoumas, Ms. Barry, Mr. Martin or Mr. Shetty retire, a prorated number of RSUs will vest based on the months elapsed since the start of fiscal 2021. If Mr. Duda retires, all his RSUs will fully vest. |
Potential Payments Upon Termination or Change of Control
| | Scenario | | | | | Type of Award | Change in Control | Death or Disability | Termination Without Cause | Retirement(1) | | Performance-Based Restricted Stock Awards (“RSAs”) | For Mr. Duda, Mr. Martin and Mr. Shetty, a prorated number of RSA shares will vest based on the number of months elapsed since the start of fiscal 2021. For Mr. Tsoumas and Ms. Barry, all RSA shares are fully vested. | All RSA shares are fully vested. | If Mr. Duda, Mr. Tsoumas or Ms. Barry are terminated without cause, a prorated number of RSA shares will be eligible for vesting based on the number of months elapsed since the start of fiscal 2021. The number of RSA shares to vest will depend on the Company’s fiscal 2025 EBITDA. | For Mr. Tsoumas, Ms. Barry, Mr. Martin and Mr. Shetty, a prorated number of RSA shares will be eligible for vesting based on the number of months elapsed since the start of fiscal 2021. All of Mr. Duda’s RSA shares will be eligible for vesting. The number of RSA shares to vest will depend on the Company’s fiscal 2025 EBITDA. | | Performance Units | All the Performance Units are forfeited to the Company. | All the Performance Units are forfeited to the Company. | If Mr. Duda, Mr. Tsoumas or Ms. Barry are terminated without cause, a prorated number of Performance Units will be eligible to be earned based on the number of months elapsed since the start of fiscal 2021. The number of Performance Units to be earned will depend on the Company’s fiscal 2025 EBITDA. | For Mr. Tsoumas, Ms. Barry, Mr. Martin and Mr. Shetty, a prorated number of Performance Units will be eligible to be earned based on the number of months elapsed since the start of fiscal 2021. All of Mr. Duda’s Performance Units will be eligible to be earned. The number of Performance Units to be earned will depend on the Company’s fiscal 2025 EBITDA. |
Potential Payments Upon Termination or Change of Control
| (1) An executive’s qualified retirement occurs at or after age 65, or after age 55 with our consent. Mr. Duda is 69 years old. All our other named executive officers other than Mr. Avula are between 55 and 65 years old. Following the end of fiscal year 2024, the Compensation Committee consented to Mr. Tsoumas’ retirement prior to age 65. |
Potential Payments Upon Termination or Change of Control
No payments would be made in connection with any of the awards in the foregoing table in the event that a named executive officer’s employment is terminated for cause, or in the event the named executive officer terminates his or her employment (other than for good reason in connection with a change in control as noted above). The following table shows the potential amounts payable to our named executive officers other than Mr. Duda upon termination or a change of control of Methode. The amounts shown assume that such termination or change of control occurred on April 26, 2024, the last trading day of our 2024 fiscal year, and reflect the price of our common stock on such date of $12.22. The table below does not reflect amounts payable pursuant to plans or arrangements that are available generally to salaried employees. In addition, the table does not reflect the distribution of account balances in our Deferred Compensation Plan or the delivery of common stock underlying vested restricted stock units.
Potential Payments Upon Termination or Change of Control
| Name | Termination Scenario (On 4/26/2024) | Salary and Bonus Severance ($) | Annual Performance -Based Bonus ($) | Retention Bonus | Vesting of RSUs ($)(1) | Vesting of RSAs ($)(1)(2) | Vesting of Performance Units ($)(2) | Health and Welfare Benefits ($)(3) | | Mr. Avula | Upon Change of Control(4) | — | 611,507 | — | 1,770,397 | — | — | — | | | Resignation for Good Reason/Termination Without Cause Following Change of Control(5) | 3,011,507 | — | — | — | — | — | 63,551 | | | Death or Disability | — | 203,836 | — | 1,770,397 | — | — | — | | | Qualified Retirement | — | 203,836 | — | 0 | — | — | — | | | Termination Without Cause | 2,616,000 | | — | 0 | — | — | 31,776 | | | Resignation | — | — | — | — | — | — | — | | Mr. Tsoumas | Upon Change of Control(4) | — | 749,480 | — | 366,600 | 922,610 | — | — | | | Resignation for Good Reason/Termination Without Cause Following Change of Control(5) | 1,748,786 | — | 500,000 | — | — | — | 27,343 | | | Death or Disability | — | 374,740 | 500,000 | 366,600 | 922,610 | — | — | | | Qualified Retirement | — | 374,740 | — | 293,280 | 738,088(6) | 0 | — | | | Termination Without Cause | — | — | 500,000 | 293,280 | 738,088 | 0 | — | | | Resignation | — | — | — | — | — | — | — | | Ms. Barry | Upon Change of Control(4) | — | 849,750 | — | 256,620 | 641,550 | — | — | | | Resignation for Good Reason/ Termination Without Cause Following Change of Control(5) | 1,982,750 | — | 750,000 | — | — | — | 42,367 | | | Death or Disability | — | 424,875 | 750,000 | 256,620 | 641,550 | — | — | | | Qualified Retirement | — | 424,875 | — | 205,296 | 513,240(6) | 0 | — | | | Termination Without Cause | — | — | 750,000 | 205,296 | 513,240 | 0 | — | | | Resignation | — | — | — | — | — | — | — | | Mr. Martin | Upon Change of Control(4) | — | 580,800 | — | 246,844 | 493,688 | — | — | | | Resignation for Good Reason/Termination Without Cause Following Change of Control (5) | 1,468,800 | — | 440,000 | — | — | — | 0 | | | Death or Disability | — | 290,400 | 440,000 | 246,844 | 617,110 | — | — | | | Qualified Retirement | — | 290,400 | — | 197,475 | 493,688(6) | 0 | — | | | Termination Without Cause | — | — | 440,000 | 0 | 0 | 0 | — | | | Resignation | — | — | — | — | — | — | — | | Mr. Shetty | Upon Change of Control(4) | — | 585,494 | — | 112,424 | 664,768 | — | — | | | Resignation for Good Reason/Termination Without Cause Following Change of Control(5) | 1,472,606 | — | 445,000 | — | — | — | 42,367 | | | Death or Disability | — | 292,747 | 445,000 | 112,424 | 830,960 | — | — | | | Qualified Retirement | — | 292,747 | — | 89,939 | 664,768(6) | 0 | — | | | Termination Without Cause | — | — | 445,000 | 0 | 0 | 0 | — | | | Resignation | — | — | — | — | — | — | — |
Potential Payments Upon Termination or Change of Control
| (1) Amounts include an amount equal to the cash dividends declared during the period from the date of grant thru April 26, 2024, multiplied by the number of shares or units vested. |
Potential Payments Upon Termination or Change of Control
| (2) For purposes of this table, we have assumed that the target performance level will be achieved with respect to the RSAs and the Performance Units and that our Compensation Committee has elected to accelerate all awards subject to the discretion of the Compensation Committee. |
Potential Payments Upon Termination or Change of Control
| (3) Reflects the estimated lump-sum present value of all future premiums which will be paid on behalf of the executive under our health and welfare benefit plans. |
Potential Payments Upon Termination or Change of Control
| (4) Assumes the successor company does not assume the annual bonus awards, RSUs or RSAs. |
Potential Payments Upon Termination or Change of Control
| (5) These amounts are in addition to amounts payable under the preceding row “Upon Change of Control.” |
Potential Payments Upon Termination or Change of Control
| (6) Assumes the target level of performance is achieved. |
Potential Payments Upon Termination or Change of Control
Resignation of Former CEO During Fiscal 2024. As discussed elsewhere in this proxy statement, in accordance with a previously announced leadership transition plan. Mr. Duda resigned as our President and Chief Executive Officer on January 29, 2024, upon the commencement of Mr. Avula’s employment as his successor. Following his resignation as Chief Executive Officer, Mr. Duda assumed an advisory role in the position of Executive Advisor for a three month period until his retirement date on April 30, 2024. Payments to Mr. Duda in connection with his resignation and retirement and subsequent engagement as a consultant during a transitional period, and his ongoing obligations to the Company, are set out in his Retention, Transition Services and Consulting Agreement dated August 31, 2023, and in applicable award agreements. Between the date of his resignation as President and Chief Executive Officer and his retirement date, Mr. Duda continued to receive his existing base salary (approximately $1,031,400 per year) and benefits (approximately $2,740). He also remained eligible to receive the earned portion of his annual performance-based cash bonus for fiscal 2024, which was paid in the amount of $835,434. See “Components of Fiscal 2024 Compensation – Annual Performance-Based Bonuses” in the Compensation Discussion and Analysis above. Upon his retirement date, Mr. Duda was engaged as a consultant for a period of nine months for a fee of $350,000 per month in order to assist the Company in connection with the transition of his duties and responsibilities. Mr. Duda is restricted under the Transition Agreement from engaging in certain activities in competition with the Company and its subsidiaries or from soliciting suppliers, vendors, customers or employees of the Company or its subsidiaries, for a period ending fifteen months after the end of the consulting period. Upon his retirement date, Mr. Duda’s outstanding and unvested RSUs, representing 150,000 RSU awards with a market value at April 26, 2024 of approximately $1,833,000, became vested. He remains eligible to earn his performance-based restricted stock awards under the 2021 LTI Program, and any Performance Units, subject to the conditions of the 2021 LTI Program relating to achievement of threshold or target 2025 EBITDA. See “Components of Fiscal 2024 Compensation – 2021 LTI Program – RSAs” and “Components of Fiscal 2024 Compensation – 2021 LTI Program – Performance Units” in the Compensation Discussion and Analysis above.
CEO PAY RATIO
CEO PAY RATIO As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of SEC Regulation S-K, we are providing the following information about the ratio of the median annual total compensation of our employees to the annual total compensation for fiscal 2024 of our two Chief Executive Officers serving during the latest fiscal year, Avinash Avula and Donald W. Duda. To calculate the pay ratio, we identified the median employee based on our employee population as of February 1, 2024, which was approximately 6,900 employees in the United States, Mexico, Egypt, Malta, China, Finland, Canada, Belgium, India, the United Kingdom, Germany, Italy, Switzerland, Singapore, Malaysia, the Netherlands and Taiwan. For purposes of identifying the median employee, we considered annual base salary as of February 1, 2024, plus overtime, allowances and short-term incentive compensation for the trailing twelve months, each as reported in our payroll records and adjusted to US dollars. We did not make any cost-of-living adjustments to the pay of employees living in different jurisdictions than our Chief Executive Officers, but we did include certain adjustments for the annualization of pay for employees who were employed for only part of the period. Based on this analysis, we determined that our median employee is an Operator located in Monterrey, Mexico, using this employee’s total compensation as calculated under applicable SEC rules. For fiscal 2024, the median of the annual total compensation of all our employees (other than Mr. Avinash and Mr. Duda) was $12,331. Our median annual total compensation reflects that the bulk of our employees are in countries that have much lower prevailing wages than the United States. Mr. Avula replaced Mr. Duda as our Chief Executive Officer on January 29, 2024 and his annual total compensation reported in the Summary Compensation Table was $4,017,227. For purposes of this analysis, we annualized Mr. Avula’s salary and bonus, resulting in annual total compensation of $5,406,227. Based on these calculations, the pay ratio between our CEO and median employee is 438 to 1. The assumptions used in the calculation of our estimated pay ratio are specific to our company and our employee population. As such, our pay ratio may not be comparable to the pay ratios of other companies, including companies in our compensation peer group.
PAY VS. PERFORMANCE
PAY VS. PERFORMANCE As required by SEC rules, we are providing the following 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 named executive officers in the table below, we are required to make various adjustments to amounts reported in the Summary Compensation Table for this year and in previous years, as the SEC’s valuation methods for this section differ from those required in the Summary Compensation Table. The “compensation actually paid” data reflected in the table below may not reflect amounts actually realized by our named executive officers. For information concerning the decisions made by our Compensation Committee with respect to compensation for the named executive officers for each fiscal year, please see the Compensation Discussion and Analysis sections of this proxy statement and the proxy statements for the other fiscal years covered in the table below. A significant portion of “compensation actually paid” amounts shown relates to changes in values of unvested awards over the course of the reporting year. These unvested awards remain subject to significant risk from forfeiture conditions and possible future declines in value based on changes in our stock price. The ultimate values actually realized by our named executive officers from unvested equity awards will not be determined until the awards fully vest. The following table summarizes compensation paid to our Chief Executive Officer serving as of the end of our fiscal year end (referred to in the tables below as our PEO) and our former Chief Executive Officer (referred to in the tables below as our former PEO) as set forth in our Summary Compensation Table, the adjusted values of compensation actually paid to our PEO and former PEO, average compensation paid to our named executive officers other than our PEO and former PEO as set forth in our Summary Compensation Table, and the adjusted values of average compensation actually paid to such other named executive officers, each as calculated in accordance with SEC rules, as well as certain Company and peer group performance measures, in each case for the four fiscal years ended April 27, 2024.
PAY VS. PERFORMANCE
| Fiscal Year | Summary Compensation Table Total for PEO ($)(1) | Compensation Actually Paid to PEO ($)(2) | Summary Compensation Table Total for Former PEO ($)(1) | Compensation Actually Paid to Former PEO ($)(2) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(3) | Average Compensation Actually Paid to Non-PEO NEOs ($)(2) | Value of Initial Fixed $100 Investment Based On: | | Net Income ($ In Millions)(6) | EBITDA ($ In Millions)(7) | | | | | | | | | Total Shareholder Return ($)(4) | Peer Group Total Shareholder Return ($)(5) | | | | 2024 | 4,017,227 | 2,662,627 | 2,206,047 | (5,346,078) | 807,926 | 228,210 | 46 | 187 | (123.3) | (53.5) | | 2023 | — | — | 3,088,086 | 1,730,586 | 1,213,051 | 960,800 | 149 | 169 | 77.1 | 142.3 | | 2022 | — | — | 2,297,776 | 2,177,776 | 933,371 | 907,572 | 160 | 158 | 102.2 | 174.6 | | 2021 | — | — | 13,331,554 | 19,575,304 | 3,200,990 | 4,539,230 | 159 | 171 | 122.3 | 191.6 |
PAY VS. PERFORMANCE
| (1) Mr. Duda was the CEO from the start of fiscal 2021 through January 29, 2024. Mr. Avula was appointed CEO on January 29, 2024 and held that position at our fiscal year end. These amounts reflect the total compensation reported for Mr. Avula or Mr. Duda, as applicable, in the “Total” column of the Summary Compensation Table for the relevant fiscal year. |
PAY VS. PERFORMANCE
| (2) The chart below details the additions to and deductions from the total compensation reported for Mr. Avula, Mr. Duda, and the other NEOs as a group in the Summary Compensation Table in order to calculate and reflect the adjusted values of the Compensation Actually Paid for fiscal year 2024. |
PAY VS. PERFORMANCE
| | Fiscal 2024 | | | | | PEO | Former PEO | Average of other NEOs | | Summary Compensation Table Total | $4,017,227 | $2,206,047 | $807,926 | | Adjustments: | | | | | Deduction for amounts reported under the “Stock Awards” column in the Summary Compensation Table | ($3,125,000) | — | — | | Increase based on ASC 718 fair value of awards granted during fiscal year that remain unvested as of fiscal year end, determined as of fiscal year end | $1,770,400 | — | — | | Increase based on ASC 718 fair value of awards granted during fiscal year that vested during fiscal year, determined as of vesting date | — | — | — | | Increase (decrease) for awards granted prior to fiscal year that were outstanding and unvested as of fiscal year end, determined based on change in ASC 718 fair value from prior fiscal year end to fiscal year end | — | — | $(579,716) |
PAY VS. PERFORMANCE
| | Fiscal 2024 | | | | | PEO | Former PEO | Average of other NEOs | | Increase (decrease) for awards granted prior to fiscal year that vested during fiscal year, determined based on change in ASC 718 fair value from prior fiscal year end to vesting date | — | $(7,552,125) | — | | Deduction of ASC 718 fair value of awards granted prior to fiscal year that were forfeited during fiscal year, determined as of prior fiscal year end | — | — | — | | Compensation Actually Paid | $2,662,627 | $(5,346,078) | $228,210 |
PAY VS. PERFORMANCE
| (3) These amounts reflect the average total compensation reported for the Company’s named executive officers as a group (excluding Mr. Avula and Mr. Duda) in the “Total” column of the Summary Compensation Table for each corresponding year. The Non-PEO named executive officers are comprised of the following: fiscal 2024 – Mr. Tsoumas, Ms. Barry, Mr. Martin and Mr. Shetty; fiscal 2023 - Mr. Tsoumas, Mr. Khoury, Ms. Barry and Ms. Vyverberg; and fiscal 2022 and 2021 - Mr. Tsoumas, Mr. Khoury, Ms. Barry and Mr. Martin. |
PAY VS. PERFORMANCE
| (4) Total Shareholder Return (TSR) assumes that $100 was invested in the Company’s common stock beginning on May 3, 2020 and that all dividends and distributions were reinvested on a quarterly basis. |
PAY VS. PERFORMANCE
| (5) The peer group is made up of the same 15 companies in our peer group used for executive compensation benchmarking as described above under “Market Benchmarking and Positioning of Fiscal 2024 Executive Compensation.” Peer group TSR is calculated under the same assumptions as Company TSR. |
PAY VS. PERFORMANCE
| (6) Reflects “Net income” in the Company’s Consolidated Income Statements included in the Company’s Annual Reports on Form 10-K for each of the applicable fiscal years. |
PAY VS. PERFORMANCE
| (7) EBITDA was selected as the additional metric to be included in the table above (as the Company-Selected Measure under applicable SEC rules), as the financial performance measure that, in the Company’s assessment, represents the most important performance measure not otherwise required to be disclosed in the table and used by the Company to link executive compensation to Company performance. A detailed EBITDA reconciliation for our fiscal years 2024 and 2023 can be found in our fourth quarter 2024 earnings release included as Exhibit 99.1 to the Company’s Current Report on Form 8-K furnished with the SEC on July 11, 2024. |
PAY VS. PERFORMANCE
Relationship of Compensation Actually Paid to Financial Measures. The following charts compare the relationship of the compensation actually paid to Mr. Avula and Mr. Duda and the average compensation actually paid to our named executive officers other than Mr. Avula and Mr. Duda to the respective financial measures set forth therein, for the periods indicated. Most Important Financial Performance Measures. The three items listed below are the most important financial performance measures we used in fiscal 2024 to determine compensation for our named executive officers, as further described above in the Compensation Discussion & Analysis section under “Components of Fiscal 2024 Compensation.”
PAY VS. PERFORMANCE
| • | EBITDA |
PAY VS. PERFORMANCE
| • | New business bookings |
PAY VS. PERFORMANCE
| • | Gross margin |