DEF 14A of Mission Produce, Inc.
Filed Feb 25, 2025 · FY20240001140361-25-005868
ITEM 1: ELECTION OF DIRECTORS
ITEM 1: ELECTION OF DIRECTORS Our Board of Directors currently consists of eight members. In accordance with our Certificate of Incorporation, our Board of Directors is divided into three classes (Class I, Class II, and Class III) with staggered three-year terms. At each annual meeting of stockholders, the successors to the directors whose terms will then expire will be elected to serve from the time of election and qualification until the third annual meeting following their election, until his or her successor is elected and qualified, or, if earlier, until his or her earlier death, resignation, disqualification, or removal. Our current directors are divided among the three classes as follows:
ITEM 1: ELECTION OF DIRECTORS
| Class | Director | Term Expiration | | Class I | Stephen A. Beebe Jay A. Pack Tony Bashir Sarsam | 2027 Annual Meeting | | Class II | Luis A. Gonzalez Bruce C. Taylor | 2025 Annual Meeting | | Class III | Stephen J. Barnard Bonnie C. Lind Linda B. Segre | 2026 Annual Meeting |
ITEM 1: ELECTION OF DIRECTORS
Based on the recommendation of the Nominating and Corporate Governance Committee, the Board of Directors has nominated Luis A. Gonzalez and Bruce C. Taylor for re-election to the Board of Directors for three-year terms expiring at the 2028 annual meeting of stockholders, until the director’s successor is elected and qualified, or, if earlier, until the director’s earlier death, resignation, disqualification, or removal.
Continuing Directors
Continuing Directors The biographical information for our six directors whose terms will continue after the 2025 Annual Meeting and will expire at the 2026 annual meeting (Class III) or the 2027 annual meeting (Class I) is below.
Stephen A. Beebe – Class I
Stephen A. Beebe – Class I Stephen A. Beebe has served on our Board of Directors since 1995 and has served as Chairman of our Board of Directors since our 2024 annual meeting of stockholders. Previously, he also served as the Company’s Chairman of the Board of Directors from 2003 until 2020. From 1993 until his retirement in 2002, Mr. Beebe served as the President and Chief Executive Officer of the J.R. Simplot Company, one of the largest privately held diversified agribusiness companies in the United States. He guided the J.R. Simplot Company through expansions in Canada, Mexico, Australia, China, and Europe. Mr. Beebe continues to serve as a director for the J.R. Simplot Company, where he is a member of the Audit Committee. Mr. Beebe is also a co-manager of JRS Properties 111, which is a Simplot family partnership. He is a retired member of the executive committee of the United States Golf Association and chaired and was a member of their Audit Committee and Equipment Standards Committee. Mr. Beebe received a Juris Doctorate from the University of Idaho, is a member of the Idaho Bar Association (retired) and is a graduate of the Stanford University Executive Program. In 2002, Mr. Beebe was awarded an Honorary Doctorate of Agriculture Science from the University of Idaho. The Board of Directors concluded that Mr. Beebe should serve as a director based on his substantial business experience in the agriculture sector and his extensive management and leadership experience serving as a chief executive officer of a global agribusiness company.
Jay A. Pack – Class I
Jay A. Pack – Class I Jay A. Pack has served on our Board of Directors since 2008. Mr. Pack is the former owner of Standard Fruit and Vegetable, an integrated re-packer, logistics, and value-added produce company, which was sold to Del Monte in 2003. He served on the board of Coastal Sunbelt Produce, a private foodservice distributor serving the Mid-Atlantic states, from 2014 to March 2022 when Coastal Sunbelt was acquired by Sysco. Previously, Mr. Pack served on the private company boards of Misionero, Earthbound Farm, and Combs Produce. He has also previously served as a trustee of Sarah Lawrence College, a board member of the Produce Marketing Association (PMA), Chairman of the PMA Foodservice Division, and as President of the North Texas Food Bank. Mr. Pack received a Bachelor of Science degree from Boston University and a Master of Business Administration degree from Southern Methodist University. The Board of Directors concluded that Mr. Pack should serve as a director based on his broad knowledge of the produce industry and his extensive business and leadership experience with various produce companies and agricultural industry groups.
Tony Bashir Sarsam – Class I
Tony Bashir Sarsam – Class I Tony Bashir Sarsam has served on our Board of Directors since August 2023. He has served as the President and Chief Executive Officer and a member of the board of directors of SpartanNash (NASDAQ: SPTN), a food solutions company, since 2020. Before joining SpartanNash, Mr. Sarsam served as the chief executive officer of Borden Dairy Company, a private dairy processor and distributor, from 2018 to 2020, where he led the company through a restructuring, reorganization, and successful sale. Prior to Borden, he was the chief executive officer of Ready Pac Foods, a private food processing company, from 2013 to 2018 where he also served on the board of directors from 2014 to 2017. Mr. Sarsam holds a Bachelor of Science, Engineering degree in Chemical Engineering from Arizona State University and a Master of Science in Management from Stanford University. The Board of Directors concluded that Mr. Sarsam should serve as a director based on his extensive experience serving as a chief executive officer of several companies in adjacent industries, his public company board and executive experience, and his strong knowledge of the food industry.
Stephen J. Barnard – Class III
Stephen J. Barnard – Class III Stephen J. Barnard founded the Company in 1983 and has served as our Chief Executive Officer since 1988. Mr. Barnard also served as the Company’s President from 1988 until July 2022 and from December 2023 through April 1, 2024 when Mr. Pawlowski was appointed as President and Chief Operating Officer. Mr. Barnard serves as a member of the Board of Directors, a role he has held since the Company was founded. Mr. Barnard currently serves as an at-large director for the International Fresh Produce Association and as a director for the Cal Poly Foundation. Prior to founding Mission Produce, Mr. Barnard worked in the lettuce and avocado divisions of Santa Clara Produce, Inc. Mr. Barnard previously served as Chairman of the Produce Marketing Association (PMA), Chairman of the Western Growers Association, a director of the California Avocado Commission, and a director of Sunkist Growers. Mr. Barnard received a Bachelor of Science degree in agricultural business management from California Polytechnic State University, San Luis Obispo. The Board of Directors concluded that Mr. Barnard should serve as a director based on his deep and thorough knowledge of all aspects of our business and industry, his effective leadership and management skills, and his long-tenured service in senior roles with key industry groups.
Bonnie C. Lind – Class III
Bonnie C. Lind – Class III Bonnie C. Lind has served on our Board of Directors since June 2020. Ms. Lind is the retired Senior Vice President, CFO and Treasurer of Neenah, Inc., (NYSE: NP), a publicly traded technical specialties and fine paper company, a position she held from June 2004 to May 2020. Prior to that, Ms. Lind held a variety of increasingly senior financial and operations positions with Kimberly-Clark Corporation (NYSE: KMB), a manufacturer of personal care, consumer tissue and health care products, from 1982 until 2004. She has been a member of the Board of Directors of Albany International (NYSE: AIN), a textiles and materials processing company, since February 2024 and serves on the Audit Committee. She has also served as a director of Hubbell Incorporated (NYSE: HUBB) since January 2019 where she is chair of the Audit Committee and a member of the Nominating and Corporate Governance Committee. Beginning in January 2022, she joined the Board of Directors of a private timberlands company, Tamarack Holdings LLC, where she is Chairman of the Audit Committee. She was previously a director at U.S. Silica Holdings, Inc. (NYSE: SLCA), a global industrial minerals and logistics leader, from 2019 to 2021 where she served on the Audit and Nominating and Corporate Governance Committees. She was also previously a director at Federal Signal Corporation (NYSE: FSS), a world leader in manufacturing lightbars, beacons, warning lights, and backup alarms/cameras, from 2014 to 2018, where she served on the Nominating and Governance Committee and the Audit Committee. She also served as a director of Empire District Electric Company (NYSE: EDE), an investor-owned utility providing electric, natural gas, and water service, from 2009 to 2017 and was a member of the Audit Committee and Chairman of its Nominating and Corporate Governance Committee. Ms. Lind holds a Bachelor of Business Administration (Finance) with honors from the University of Georgia. The Board of Directors concluded that Ms. Lind should serve as a director based on her experience as the chief financial officer of a public company, her financial acumen and financial expertise, her public and private company board experience, as well as her decades of senior financial and operations positions for public and private companies across a wide variety of industries.
Compensation Committee
| • | makes recommendations to the Board of Directors regarding director compensation; |
Director Compensation
Director Compensation Our current Non-Employee Director Compensation Policy, adopted on September 6, 2023, consists of the following components:
Director Compensation
| Director Compensation Program | | | Annual Cash Retainers | | | Board Cash Retainer | $60,000 | | Committee Cash Retainers: | | | Annual Committee Chair Retainer (in lieu of committee member retainers) | | | •Audit | $15,000 | | •Compensation | $10,000 | | •Nominating and Corporate Governance | $10,000 | | Annual Committee Member Retainer | | | •Audit | $7,500 | | •Compensation | $5,000 | | •Nominating and Corporate Governance | $5,000 | | Initial Equity Compensation | | | Equity Award (RSUs); pro-rated based on appointment date through next annual meeting of stockholders | $100,000 | | Annual Equity Compensation | | | Equity Award (RSUs) | $100,000 | | Additional Chairman of the Board Equity Award (RSUs) | $40,000 |
Director Compensation
Annual cash retainers are paid in quarterly installments in arrears and pro-rated for any partial calendar quarter of service. In addition, committee member and committee chair retainers are only paid if the director attends the meeting, if any, for the calendar quarter for which fees are paid. In accordance with the Non-Employee Director Compensation Policy, each non-employee director who is initially elected or appointed to serve on the Board of Directors is automatically granted RSUs with a value of approximately $100,000 on the date on which such director is appointed or elected to serve on the Board of Directors, pro-rated based on the number of days between the effective date of appointment and the Company’s next annual meeting. Additionally, each non-employee director who is serving on the Board of Directors as of the date of each annual meeting of the stockholders is automatically granted, on such annual meeting date, an RSU award with a value of approximately $100,000, and a non-employee director serving as the Chairman of the Board of Directors is automatically granted additional RSUs with a value of $40,000 on such date. All equity grants vest in full on the earlier to occur of (i) the one-year anniversary of the applicable grant date and (ii) the date of the next annual meeting following the grant date, subject to the directors’ continued service through the applicable vesting date. In addition, such awards vest in full upon a change in control of the Company (as defined in the Company’s 2020 Incentive Award Plan).
Nonqualified Deferred Compensation Plan
Nonqualified Deferred Compensation Plan Pursuant to the Company’s Deferred Compensation Plan applicable to non-employee directors, our non-employee directors can elect to defer up to 100% of their annual equity award grant and the annual Chairman grant, as applicable. Annual equity awards that are deferred are credited to a deferred compensation account and vested balances are distributed: (1) at the time of separation either in a lump sum or up to 10 annual installments; (2) pursuant to an in-service election on specified dates of distribution either in a lump sum or up to five annual installments; (3) upon a separation from service due to a change in control either in a lump sum or up to 10 annual installments; and (4) upon death in a lump sum to the director’s beneficiaries. The unfunded, nonqualified plan structure of the Deferred Compensation Plan is required in order to preserve the beneficial tax deferral treatment for the participants. Amounts in a participant’s deferral accounts are considered general liabilities of the Company and subject to creditor risk in the case of corporate insolvency or bankruptcy. Mr. Pack participated in the Deferred Compensation Plan during 2024.
Director Stock Ownership Guidelines
| • | Deferred equity under the Nonqualified Deferred Compensation Plan. |
2024 Director Compensation
2024 Director Compensation The following table sets forth information for the fiscal year ended October 31, 2024 regarding the compensation awarded to, earned by or paid to our non-employee directors who served on our Board of Directors during fiscal year 2024. Mr. Barnard, our CEO, does not receive additional compensation for his service as a director. All compensation paid to Mr. Barnard is reported in the “Summary Compensation Table.”
2024 Director Compensation
| Name | Fees earned or paid in cash ($) | Stock awards ($)(1) | All Other Compensation ($) | Total ($) | | Stephen A. Beebe | 76,875 | 136,092(2) | — | 212,967 | | Stephen W. Bershad(3) | 20,000 | — | — | 20,000 | | Luis A. Gonzalez | 60,000 | 97,208 | — | 157,208 | | Bonnie C. Lind | 76,250 | 97,208 | — | 173,458 | | Jay A. Pack | 71,250 | 97,208 | — | 168,458 | | Tony Bashir Sarsam | 63,750 | 97,208 | — | 160,958 | | Linda B. Segre | 70,000 | 97,208 | — | 167,208 | | Bruce C. Taylor | 68,750 | 97,208 | — | 165,958 |
2024 Director Compensation
| (1) Represents the grant date fair value of 8,475 RSUs granted to each of our non-employee directors on April 11, 2024 computed in accordance with Accounting Standards Codification Topic 718, based on a closing price of our stock on the date of grant of $11.47. Such closing stock price differs from the stock price used to calculate the number of shares awarded to each director (which is based on a trailing 30-day average stock price from the date of grant consistent with our equity grant practices). As of October 31, 2024, Messrs. Gonzalez, Pack, Sarsam, and Taylor, and Mses. Lind and Segre each held 8,475 outstanding unvested RSUs and Mr. Beebe held 11,865 unvested RSUs. Mr. Pack participated in our Non-Employee Director Deferred Compensation Plan for 2024 and therefore, his 8,475 RSUs will be deferred upon vesting. In addition, outstanding vested but deferred RSUs under the Non-Employee Director Deferred Compensation Plan as of October 31, 2024 were: 14,186 for Mr. Pack, 13,152 for Ms. Lind, and 17,282 for Mr. Beebe. Mr. Bershad previously participated in the Non-Employee Director Deferred Compensation Plan. His deferred balances were paid out at separation of service in line with his elections. |
2024 Director Compensation
| (2) Includes an additional 3,390 RSUs granted to Mr. Beebe on April 11, 2024 pursuant to our Director Compensation Program for serving as the Chairman of the Board of Directors and computed in accordance with Accounting Standards Codification Topic 718, based on a closing price of our stock on the date of grant of $11.47. Such closing stock price differs from the stock price used to calculate the number of shares awarded to each director (which is based on a trailing 30-day average stock price from the date of grant consistent with our equity grant practices). |
2024 Director Compensation
| (3) Mr. Bershad retired from the Board of Directors effective as of the 2024 annual meeting of stockholders. |
Overview of 2024 Compensation Program for NEOs
| COMPONENT OF PAY | BASE SALARY | ANNUAL CASH INCENTIVE | LONG-TERM EQUITY INCENTIVE | | | Fixed cash compensation based on the market-competitive value of the skills and knowledge required for each role. Reviewed annually and adjusted when appropriate to maintain market competitiveness. Increases are not automatic nor guaranteed. Increases are generally based on factors such as standard cost of living increases, market competitiveness, individual and company performance and pay equity. | Annual cash incentives based 100% on a Company financial performance metric for our CEO; 80% on a Company performance metric and 20% on individual performance for our other NEOs who participate in our annual incentive plan. Target cash bonus opportunity under the annual incentive plan was 100% of base salary for our CEO, and 75% of base salary for other participating NEOs. | Long-term equity incentive program with forward-looking equity awards intended to motivate and reward executives for future growth and financial performance and align the interests of executives and stockholders. Performance-based PSUs that are earned based on financial performance over a three-year period and time-vested RSUs that vest ratably over a three-year period. Our 2024 long-term equity incentive grants were weighted 50/50 between PSUs and RSUs. |
Overview of 2024 Compensation Program for NEOs
Base Salary After reviewing market data and benchmarking provided by Pearl Meyer, and in consideration of the overall performance of the Company for fiscal 2023 and the standard annual merit increases provided to employees, the Compensation Committee increased the base salary for our Chief Executive Officer and Chief Financial Officer by 3% and for our General Counsel and Secretary by 8.2%, with individual determinations based on factors such as market competitiveness and individual performance. Our President of Central and South America did not receive base salary increase for fiscal 2024. Mr. Pawlowski joined the Company in April 2024, at which time his annual base salary was set at $600,000 after consideration of the compelling compensation package needed to attract Mr. Pawlowski, review of market data provided by Pearl Meyer, and negotiations with Mr. Pawlowski. Annual Cash Incentive Annual Cash Incentive Plan awards are designed to reward the achievement of objective financial goals tied to our budget and individual contributions that support business results and the execution of the Company’s strategy. For fiscal 2024, target bonus opportunity under the annual cash incentive plan ranged from 100% of base salary for our Chief Executive Officer to 75% of base salary for our other participating NEOs. Mr. Wiesner does not participate in our annual cash incentive plan, and Mr. Pawlowski, who joined the Company in April 2024, did not participate in our annual cash incentive plan for 2024. For our fiscal 2024, the Compensation Committee approved the following annual cash incentive plan design: Stephen J. Barnard, CEO. The Compensation Committee believes that the CEO’s compensation should be as fully aligned with the financial performance of the Company as possible. Therefore, the Compensation Committee designed Mr. Barnard’s annual incentive to be based 100% on Company performance.
Overview of 2024 Compensation Program for NEOs
| CEO | | 100% tied to Company Performance | | Metric: Adjusted EBITDA Performance range: 50% threshold, 100% target, 150% max Payouts: 0% at threshold, 100% at target, and 200% at maximum; linearly interpolated between performance levels and no payouts below threshold | | Maximum payout under 2024 annual cash incentive plan = 200% of target bonus opportunity | | FY2024 achievement at 136% of target Adjusted EBITDA, resulting in a 172% payout of target bonus opportunity |
Overview of 2024 Compensation Program for NEOs
Bryan E. Giles, Chief Financial Officer and Joanne C. Wu, General Counsel and Secretary. For Mr. Giles and Ms. Wu, the Compensation Committee determined to retain the 20% of the total target bonus opportunity tied to individual performance, while maintaining its focus on tying an overwhelming portion of bonus opportunity to Company performance (based on Adjusted EBITDA metrics).
Overview of 2024 Compensation Program for NEOs
| Other Eligible NEOs | | | 80% tied to Company Performance | 20% tied to Individual Performance | | Metric: Adjusted EBITDA Performance range: 50% threshold, 100% target, 150% max Payouts: 0% at threshold, 100% at target, and 200% at maximum; linearly interpolated between performance levels and no payouts below threshold | Based on individual performance assessed at fiscal year end Maximum payout capped at 20% | | Maximum payout under 2024 annual cash incentive plan = 180% of target bonus opportunity | | | FY2024 achievement at 136% of target Adjusted EBITDA and 20% on individual performance, resulting in a 158% payout of target bonus opportunity | |
Overview of 2024 Compensation Program for NEOs
| | Threshold | Target | Maximum | | Performance Range (% of cumulative 3-year adjusted net income /share) | 70% | 100% | 130% | | PSUs earned as a % of target | 50% | 100% | 200% |
Overview of 2024 Compensation Program for NEOs
Fiscal 2022 was the first year the Compensation Committee approved a performance-based long-term equity incentive program. Our 2022-2024 PSUs are earned, if at all, based on cumulative adjusted net income goals over a three-year performance period (November 1, 2021- October 31, 2024). The Company did not achieve the threshold level of performance for the 2022-2024 performance period. As such, no PSUs were earned for the 2022-2024 performance period. Our 2022-2024 PSUs represented 30% of the equity award value granted under the 2022 long-term equity incentive plan. Such value was never realized by the NEOs. The Compensation Committee believes this demonstrates its steadfast commitment to paying for performance. RSUs under the long-term equity incentive program vest ratably over three years, subject to continued service through the vesting date.
Compensation Policies and Practices
| Key Compensation Philosophy Pillar | How Operationalized in Compensation Decisions | | Enable Mission to attract and retain high caliber talent | • Target total compensation levels and incentive opportunities at market competitive levels. • Provide flexibility in structuring sign-on (hire) and promotional awards. | | Link pay and performance | • Annual cash incentive plan based primarily on a prospective formulaic approach based on pre-established threshold/target/maximum EBITDA goals. • PSU component of long-term equity incentive plan uses cumulative adjusted net income per share metric, which is communicated in quarterly earnings to stockholders and serves as a key performance indicator and input for analyst stock price targets. • A clawback policy enabling incentive compensation to be recouped. |
Compensation Policies and Practices
| Key Compensation Philosophy Pillar | How Operationalized in Compensation Decisions | | Create alignment with stockholders | • Our compensation program utilizes a mix of multi-year PSUs and time-vested RSUs, with a 50/50 split. • PSUs are earned based on our performance against pre-established cumulative adjusted net income per share goals for the three-year performance period, thereby encouraging long-term value creation in alignment with the interests of our stockholders. Total annual equity grants as a percentage of shares outstanding (burn rate) is reasonable relative to peers. • Robust stock ownership guidelines (5x for our CEO, 3x for our CFO and President and COO, and 1x for all other NEOs) ensures long-term alignment with stockholders. |
Compensation Policies and Practices
| Pay Magnitude | • Peer group data and comparisons are used with consideration given to the Company’s relative positioning on revenue, net income, market capitalization, and market capitalization divided by revenue • Size-appropriate compensation survey data is also used to fill data gaps and provide an additional layer of market data comparisons • Careful attention is paid to ensuring internal equity and retention | | Role of Market Data | • General philosophy to target market median competitive ranges depending on the circumstances • Flexibility to reflect variations as appropriate based on unique individual factors | | Mix of Pay | • Emphasis on variable at-risk compensation • Significant portion of compensation should be based on long-term equity incentives • Appropriate balance between annual and multi-year components based on performance | | Risk Orientation | • Incentive plans should have appropriately challenging targets for threshold, target, and maximum payouts • Over 100% payout upside opportunities pursuant to annual cash incentive plan and PSUs provide ample leverage while the maximum payout caps on our annual cash incentive and PSU programs mitigate against windfall payouts | | Use of Discretion | • Very limited use of discretion in extraordinary circumstances ensures transparency and maintains integrity of plan designs; to-date, no discretionary awards have been made to executive officers on performance-based compensation tied to company performance metrics that are not achieved. | | Stockholder Alignment | • Program design and pay outcomes should reflect a significant mix of equity, increasing alignment and balancing stockholder interests with internal motivation/retention needs |
Peer Group and Benchmarking
Peer Group and Benchmarking Market data, including information for peer group companies and from compensation surveys, is part of the diverse toolkit the Compensation Committee uses to set fair and competitive compensation levels that help drive the creation of long-term value while mitigating undue risk-taking. The Compensation Committee uses market compensation information to understand how other comparable public companies design executive compensation to assist the Company in offering competitive compensation levels to attract and retain exceptional executives. The Compensation Committee annually reviews the composition of our peer group to ensure that each company’s relevant attributes remain comparable to ours. The Compensation Committee believes it is appropriate to focus on companies with similar characteristics based on total revenues, market capitalization, and industry (by primary GICS classification). These are representative companies that face many of the same strategic and operational considerations we do and against whom we compete for executive talent. In June 2023, the Compensation Committee conducted its review of the peer group to aid in its review of compensation determinations for fiscal 2024. After review, and based in part on recommendations from Pearl Meyer, the Compensation Committee determined to make several modifications to its 2024 peer group. The Compensation Committee added Vita Coco Company, Vital Farms, Inc., and Westrock Coffee Company, Inc., and removed BellRing Brands, Inc., Lancaster Colony Corporation, Lifecore Biomedical, Inc. (formerly Landec Corporation), Tootsie Roll Industries, Inc., and Dole plc. The Compensation Committee made these changes to ensure good business and customer comparability, as well as comparable financial positioning within the Company’s peer group. In addition, changes were made to eliminate companies where the market capitalization was too large or the comparable business was sold.
Peer Group and Benchmarking
| 2024 Peer Group | | | • B&G Foods • Calavo Growers • CalMaine Foods • Farmer Bros. Co. • Fresh Del Monte Produce • Hostess Brands • J&J Snack Foods • John B. Sanfilippo & Son | • Seneca Foods • Sovos Brands, Inc. • SunOpta • The Hain Celestial Group • The Simply Good Foods Company • Utz Brands • Vita Coco Company • Vital Farms • Westrock Coffee Company |
Peer Group and Benchmarking
The following table illustrates market capitalization and revenue statistics for the fiscal 2024 peer group and the Company’s relative position across these metrics as of June 2023.
Peer Group and Benchmarking
| Peer Group Data | Revenues (millions)(1) | Market Capitalization (millions)(2) | Market Capitalization / Revenues | | 25th Percentile | 918 | 912 | 0.6 | | 50th Percentile (median) | 1,188 | 1,224 | 1.0 | | Average | 1,444 | 1,509 | 1.3 | | 75th Percentile | 1,511 | 1,757 | 1.9 | | Mission Percentile | 1,043 41st | 828 23rd | 0.8 33rd |
Peer Group and Benchmarking
| (1) Trailing 12-month (4 quarter) revenues as of 5/1/23 |
Peer Group and Benchmarking
| (2) Market capitalization as of 5/1/23 |
Role of the Compensation Consultant
Role of the Compensation Consultant The Compensation Committee has the sole authority to engage and terminate any compensation consultant to assist in the evaluation of director or executive compensation and has the sole authority to approve the fees and other terms of retention of such compensation consultants. The Compensation Committee has engaged Pearl Meyer since 2021 to advise on a variety of subjects, which for fiscal 2024 included peer group composition and benchmarking, executive compensation philosophy and strategy, incentive plan and equity plan design, overall compensation plan design and trends, pay-for-performance analytics, and other compensation topics. While Pearl Meyer provided data and analyses and made recommendations for the compensation program, the Compensation Committee, or the Board of Directors, made all decisions regarding the compensation of the NEOs and our directors.
Fiscal 2024 Compensation Decisions
Annual Cash Incentive Plan In December 2023, the Compensation Committee approved the 2024 annual cash incentive plan which was 100% based on achievement of adjusted EBITDA goals for Mr. Barnard and 80% based on achievement of Adjusted EBITDA goals for Mr. Giles and Ms. Wu. The remaining 20% for Mr. Giles and Ms. Wu was based on individual performance as assessed at the end of the fiscal year. There were no changes to target bonus opportunities in fiscal 2024. Each NEO’s target bonus opportunity for 2024 was set as follows: Mr. Barnard – 100% of base salary, Mr. Giles – 75% of base salary, and Ms. Wu – 75% of base salary. For the purposes of determining the annual cash incentive payouts, the target bonus opportunity for each NEO is applied to such NEO’s base salary as of the last day of the fiscal year. Mr. Wiesner does not participate in the annual cash incentive plan, and Mr. Pawlowski joined the Company in April 2024 and did not participate in our 2024 annual cash incentive plan. Mr. Pawlowski will participate in our annual cash incentive plan beginning with fiscal 2025 (with a target bonus opportunity of 100% of base salary). Component Tied to Financial Performance The Compensation Committee believes Adjusted EBITDA is an important financial metric utilized by the CEO and stakeholders to assess Company performance and is published externally and well understood by the Company’s stockholders, investment community, and employees. Threshold performance under the portion of the annual cash incentive plan tied to Adjusted EBITDA performance was set at 50% of target such that achievement at that level would begin with a 0% payout and scale upwards. Achievement below 50% would result in a zero payout. Conversely, maximum payouts were capped at 200% corresponding to achievement at 150% or more of the target Adjusted EBITDA goal. The following sets forth the goals, operation of the portion of the annual cash incentive plan that was tied to company performance, and the actual performance achievement and payout percentage for fiscal 2024. Linear interpolation is utilized between the levels of achievement.
Fiscal 2024 Compensation Decisions
For 2024, the Company achieved 136% of the target Adjusted EBITDA goal, resulting in a payout percentage of 172% for this portion of the annual cash incentive tied to Company performance. Mr. Barnard’s annual cash incentive payout was based 100% of Company performance under this financial metric. Accordingly, he received an annual cash incentive payout of 172% of his target bonus opportunity. 20% Component Tied to Individual Performance (for Mr. Giles and Ms. Wu only) Participating NEOs other than our CEO earn 80% of their target bonus opportunity based on Company performance (Adjusted EBITDA metrics, above) and a maximum of 20% of target opportunity based on individual performance, resulting in a maximum payout opportunity of 180% of target bonus opportunity. For the component of the annual cash incentive plan tied to individual performance, the CEO recommended that the Compensation Committee approve a full payout of 20% of target bonus opportunity based on his assessment of each eligible NEO’s individual contributions and performance. For Mr. Giles, the CEO recognized the following contributions: expanded support of decision-making teams in sourcing, sales, inventory, and operations, strengthened relationships with investors and analysts, and effective implementation of cost reduction initiatives. For Ms. Wu, the CEO highlighted the following contributions: successfully managing litigation and disputes, increased and expanded role in overseeing and managing sustainability reporting, and improving risk management and compliance infrastructure. The Compensation Committee considered the CEO’s recommendations and approved a payout of the full 20% of target bonus opportunity payable based on individual performance for Mr. Giles and Ms. Wu. As such, total payout under the annual cash incentive plan for Mr. Giles and Ms. Wu was 158% of target bonus opportunity. 2024 Cash Payouts Under Annual Cash Incentive Plan The following table illustrates target and actual payouts under our 2024 annual cash incentive plan for all eligible NEOs.
Fiscal 2024 Compensation Decisions
| NEO | Target payout (100% achievement & 100% of bonus opportunity) ($) | Actual payout ($) | | Stephen J. Barnard | 800,000 | 1,376,034 | | Bryan E. Giles | 365,250 | 575,642 | | Joanne C. Wu | 337,500 | 531,909 |
Fiscal 2024 Compensation Decisions
Mr. Pawlowski joined the Company in April 2024 and did not participate in the annual cash incentive plan for fiscal 2024. Rather, in accordance with his offer letter, Mr. Pawlowski received a cash bonus of 100% of his base salary, pro-rated based on the number of months between his start date and October 31, 2024 (approximately $350,000). In addition, pursuant to his offer letter, Mr. Pawlowski received a one-time cash sign-on bonus in the amount of $125,000 which was earned in two increments (half was earned at the completion of his third month of employment and the other half was earned at the completion of his sixth month of employment). Mr. Wiesner does not participate in our annual cash incentive plan. Rather, the Compensation Committee approved a bonus potential of up to 25% of Mr. Wiesner’s base salary, based on the CEO’s assessment at fiscal year-end. The Compensation Committee approved a payout of 100% of his bonus potential (or $108,750 representing 25% of his base salary) based on Mr. Wiesner’s individual performance and contributions, including managing and navigating a supply constrained environment on our owned Peruvian farms and the continued execution of the Company’s cost optimization initiatives related to the Company’s Peruvian farming operations. Long-Term Equity Incentive Program The Company grants long-term incentive equity compensation to reward performance over the longer term and to align the interests of key employees with stockholders. The Compensation Committee has structured the long-term equity incentive program to be comprised of a mix of three-year performance-based PSUs and time-vesting RSUs in order to encourage long-term performance-based value creation and to facilitate retention. For fiscal 2024, the Compensation Committee assigned 50% of the award value to RSUs and 50% to PSUs. The Compensation Committee has transitioned the mix to be more heavily based on PSUs over the last several years, with 70% RSUs and 30% PSUs for fiscal 2022, 60% PSUs and 40% RSUs for 2023, and 50% PSUs and 50% RSUs for fiscal 2024 and beyond. As with prior years, the 2024 PSUs are earned based on achievement of pre-established cumulative adjusted net income per share goals at threshold, target, and maximum over the three-year performance period commencing November 1, 2023 (first day of 2024 fiscal year) through October 31, 2026 (last day of the 2026 fiscal year). Payout levels range from 50% to 200% of target awards granted, with 50% of PSUs earned for performance at threshold (70% of target), 100% PSUs earned for performance at target, and 200% PSUs earned for performance at maximum (130% of target). No PSUs are earned for performance below threshold levels. RSUs under the long-term equity incentive program vest ratably over three years following the date of grant, subject to continued employment through the vesting dates. The Compensation Committee determined that cumulative adjusted net income per share was an appropriate metric because it incentivizes performance over a multi-year period, and adjusted net income per share is utilized in the Company’s financial modeling and disclosed to stockholders as part of our quarterly and year-end results. In setting the adjusted net income per share goals for fiscal 2024, the Compensation Committee considered the budget for fiscal 2024 and a number of factors, including the Company’s financial forecasts and existing market and competitive conditions. Based on these factors, the Compensation Committee determined that the targets set would be appropriately challenging for the Company to achieve and would result in delivery of meaningful stockholder value if achieved. Long-Term Equity Incentive Annual Grant Values for Fiscal 2024 In the first quarter of fiscal 2024, the Compensation Committee approved the following equity awards, with an effective grant date of January 5, 2024, the values of which were informed in part by ranges around market median values among our peer group and are designed to increase the amount of at-risk compensation tied to our stock price and financial performance as well as long-term value creation. Following review of fiscal 2023 performance, the Compensation Committee significantly decreased the equity award value for Mr. Barnard (40% decrease) and Mr. Wiesner (60% decrease). Mr. Pawlowski’s offer letter provided for a $1,000,000 long-term equity value for fiscal 2024. The equity award grant values remained unchanged from the prior fiscal year for the other NEOs.
Fiscal 2024 Compensation Decisions
| NEO | Fiscal 2023 Total Equity Award Value($) | Fiscal 2024 Total Equity Award Value($)(1) | Fiscal 2024 RSUs Award Value(S) (50% of total) | Fiscal 2024 PSUs Award Value(S) (50% of total) | | Stephen J. Barnard | 2,000,000 | 1,200,000 | 600,000 | 600,000 | | John M. Pawlowski | N/A | 1,000,000 | 500,000 | 500,000 | | Bryan E. Giles | 680,000 | 680,000 | 340,000 | 340,000 | | Joanne C. Wu | 500,000 | 500,000 | 250,000 | 250,000 | | Juan A. Wiesner | 500,000 | 200,000 | 100,000 | 100,000 |
Fiscal 2024 Compensation Decisions
2022-2024 PSU Program Results and Payout Fiscal 2022 was the first year the Compensation Committee approved a performance-based long-term equity incentive program represented by our 2022-2024 PSU awards. 2022-2024 PSUs are earned based on cumulative adjusted net income per share goals over a three-year performance period (November 1, 2021- October 31, 2024). The Company did not achieve the threshold level of performance for the 2022-2024 performance period, and thus no PSUs were earned or vested for the 2022-2024 performance period. As a result, 30% of the equity award value approved by the Compensation Committee for the 2022 long-term equity incentive plan did not pay out and such value was never realized by the NEOs. The Compensation Committee believes this demonstrates its steadfast commitment to paying for performance.
Fiscal 2024 Compensation Decisions
Outstanding PSU awards and Options at October 31, 2024 Based on cumulative adjusted net income per share at October 31, 2024, and if our existing PSU programs paid out on such date, both our 2023-2025 PSUs for the three-year performance period from November 1, 2022 through October 31, 2025 and our 2024-2026 PSUs for the three-year performance period from November 1, 2023 through October 31, 2026, would perform between target and maximum levels of performance, in line with the Company’s strong financial performance in 2024. All outstanding stock options were underwater as of October 31, 2024, when our closing stock price was $11.80. These values demonstrate the direct correlation between the Company’s performance, stock price, and our executive compensation program. Our closing stock price on the record date of February 11, 2025 was $11.74.
Executive Severance and Change in Control
Executive Severance and Change in Control In order to continue to attract and retain qualified executives, and consistent with market practices, we maintain an employment agreement with Mr. Barnard, our CEO, and an Executive Severance Plan for our other NEOs. Mr. Wiesner does not participate in the Executive Severance Plan. Under the CEO employment agreement and the Executive Severance Plan, we provide (i) cash benefits in the event of a qualifying termination, with and without a change of control, of 2x multiple for our CEO, and 1-1.5x multiple for the other participating NEOs, of base salary plus target bonus, (ii) full vesting of time-based equity and earnout at target for outstanding PSUs, in the event of a qualifying termination in connection with a change in control (double-trigger), and pro-rata vesting and earnout at actual performance in the event of a qualifying termination not in connection with a change in control, and (iii) up to 12 months of COBRA coverage. No tax gross ups are paid and the payment of these benefits are subject to the executive’s execution and non-revocation of a release of claims in favor of the Company and a participation agreement that includes a non-solicitation restrictive covenant for 24 months.
Summary Compensation Table
Summary Compensation Table The following table provides information concerning the compensation of our NEOs for each of the last three completed fiscal years. Our fiscal year-end is October 31.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($)(2) | Stock Awards ($)(3) | Non-equity incentive plan compensation ($)(4) | All other compensation ($)(5) | Total ($) | | Stephen J. Barnard, Chief Executive Officer | 2024 | 795,210 | — | 1,238,312 | 1,376,034 | 91,263 | 3,500,819 | | | 2023 | 775,008 | — | 1,717,803 | — | 82,473 | 2,575,284 | | | 2022 | 771,164 | — | 1,821,201 | — | 77,653 | 2,670,018 | | John M. Pawlowski, President and Chief Operating Officer(1) | 2024 | 346,155 | 475,002 | 1,014,609 | — | 222,663 | 2,058,429 | | Bryan E. Giles, Chief Financial Officer | 2024 | 484,782 | 73,051 | 701,711 | 502,591 | 76,611 | 1,838,746 | | | 2023 | 467,354 | 70,875 | 584,051 | — | 73,594 | 1,195,874 | | | 2022 | 442,338 | — | 455,296 | — | 65,955 | 963,589 | | Juan A. Wiesner, President of Central and South America | 2024 | 445,737(6) | 108,750 | 206,382 | — | 17,550 | 778,419 | | | 2023 | 465,910(6) | 21,750 | 429,445 | — | 16,819 | 933,924 | | | 2022 | 453,345(6) | — | 455,296 | — | 46,344 | 954,985 | | Joanne C. Wu, General Counsel and Secretary | 2024 | 444,804 | 67,501 | 515,960 | 464,408 | 74,674 | 1,567,347 | | | 2023 | 410,146 | 62,400 | 429,445 | — | 70,808 | 972,799 | | | 2022 | 383,870 | — | 318,705 | — | 67,297 | 769,872 |
Summary Compensation Table
| (1) Mr. Pawlowski joined the Company as an executive officer on April 1, 2024. |
Summary Compensation Table
| (2) For Mr. Giles and Ms. Wu, amounts represent the 20% discretionary portion of the annual cash incentive plan that was awarded based on a subjective performance review of the individual’s overall performance for the fiscal year. For Mr. Weisner, who does not participate in our annual cash incentive plan, amounts reflect 100% of his bonus potential which was set at a maximum of 25% of his base salary. For Mr. Pawlowski, who did not participate in our annual cash incentive plan for 2024, amounts reflect, pursuant to the terms of his offer letter:(a) the value of his 2024 cash bonus which was set at 100% of his annual base salary, pro-rated based on the number of months between his start date of April 1, 2024 and October 31, 2024, and (b) a $125,000 cash sign on bonus which was earned in two increments – half upon completion of this third month of employment and the other half upon the completion of his sixth month of employment. |
Summary Compensation Table
| (3) Amounts reflect the grant date fair value of equity awards computed in accordance with Accounting Standards Codification Topic 718 (“ASC 718”), based on a closing stock price of our stock on the date of grant and, for our PSUs, a percentage earnout of 100% based on the probable outcome of the financial performance measure (cumulative adjusted net income per share) over the three-year performance period as of the grant date. Our RSUs vest ratably over three years following the date of grant. For the PSUs, cumulative adjusted net income per share is a performance condition as defined under ASC 718. The grant date fair values shown in this table are based on probable outcomes of this performance condition as of the grant date. The following are the grant date fair values of PSUs granted for fiscal 2024 based on the probable outcome and if the maximum level of performance on cumulative adjusted net income per share is achieved, resulting in a payout of 200%: |
Summary Compensation Table
| NEO | Grant Date Fair Value of PSUs at Probable Outcome ($) | Grant Date Fair Value of PSUs at Maximum Outcome ($) | | Stephen J. Barnard | 619,156 | 1,238,312 | | John M. Pawlowski | 507,299 | 1,014,598 | | Bryan E. Giles | 350,850 | 701,700 | | Juan A. Wiesner | 103,186 | 206,372 | | Joanne C. Wu | 257,975 | 515,950 |
Summary Compensation Table
For 2024 stock awards, as required by ASC 718, amounts reflect a closing stock price on the grant date of January 5, 2024 of $10.02 per share for Messrs. Barnard, Giles, and Wiesner and Ms. Wu and of April 5, 2024 of $11.81 per share for Mr. Pawlowski. Such closing stock price differs from the stock price used to calculate the number of shares awarded of $9.71 per share for Messrs. Barnard, Giles, and Wiesner and Ms. Wu and of $11.64 per share for Mr. Pawlowski, which is based on a trailing 30-day average stock price from the date of grant consistent with our equity grant practices. As such, the values reported in the Summary Compensation Table are higher than the values approved by the Compensation Committee. None of our equity awards accrue or are paid dividends.
Summary Compensation Table
| (4) Amounts reflect annual cash incentive awards that were earned based on the achievement of pre-determined Company performance criteria set early in the fiscal year which comprised 80% of the annual cash incentive plan for Mr. Giles and Ms. Wu and 100% of the annual cash incentive plan for Mr. Barnard. Our performance against the Company performance criteria – Adjusted EBITDA – under the fiscal 2024 annual cash incentive plan was between target and maximum performance at 136% of target. |
Summary Compensation Table
| (5) All Other Compensation for fiscal 2024 includes: |
Summary Compensation Table
| | Barnard | Pawlowski | Giles | Wu | Wiesner | | 401k matching contributions | $13,800 | $9,885 | $13,800 | $13,904 | — | | Health insurance premiums | $25,015 | $19,104 | $34,255 | $34,255 | $13,987 | | Incremental cost of personal use of company-owned car | $4,893 | — | — | — | $3,563 | | Incremental cost of personal use of company-chartered aircraft | $33,720 | — | — | — | — | | Supplemental disability income premiums | $7,948 | $5,573 | $5,650 | $3,609 | — | | Service award | $5,887 | — | — | — | — | | Car allowance | — | $13,215 | $22,906 | $22,906 | — | | Relocation payments and benefits | — | $116,516 | — | — | — | | Tax gross up on relocation payments and benefits | — | $58,370 | — | — | — | | Total | $91,263 | $222,663 | $76,611 | $74,674 | $17,550 |
Summary Compensation Table
The incremental cost to the Company for personal use of a Company-owned car is based on an amount allocated towards personal use and comprise, as applicable, vehicle cost, fuel, maintenance, insurance, driver costs, and registration costs. The incremental cost to the Company of personal use of Company-paid chartered aircraft is calculated based on charges paid to private charter companies for flights.
Summary Compensation Table
| (6) Includes amounts paid pursuant to a profit-sharing scheme for Mr. Wiesner’s benefit required under Peruvian labor regulations. Such additional compensation is based on the application of a certain percentage applied to the profits of our Peruvian operations and distributed to employees based on compensation and days worked. The amount for Mr. Wiesner under such profit-sharing scheme for fiscal 2024 was $8,646. |
Grants of Plan-Based Awards Table
Grants of Plan-Based Awards Table The following table sets forth information concerning each grant of an award made to an NEO in fiscal 2024 under any compensatory plan.
Grants of Plan-Based Awards Table
| Name | Grant Date | Estimated future payouts under non-equity incentive plan awards(1) | | | Estimated future payouts under equity incentive plan awards(2) | | | All other stock awards: Number of shares or stock units (#)(3) | Grant date fair value of stock and option awards ($)(4) | | | | Threshold($) | Target($) | Maximum($) | Threshold(#) | Target(#) | Maximum(#) | | | | Stephen J. Barnard | | 0 | 800,000 | 1,600,000 | | | | | | | | 1/5/2024 | | | | 30,896 | 61,792 | 123,584 | | 619,156 | | | 1/5/2024 | | | | | | | 61,792 | 619,156 | | John M. Pawlowski | | — | — | — | | | | | | | | 4/5/2024 | | | | 21,478 | 42,955 | 85,910 | | 507,299 | | | 4/5/2024 | | | | | | | 42,956 | 507,310 | | Bryan E. Giles | | 0 | 292,200 | 584,400 | | | | | | | | 1/5/2024 | | | | 17,508 | 35,015 | 70,030 | | 350,850 | | | 1/5/2024 | | | | | | | 35,016 | 350,860 | | Juan A. Wiesner | | — | — | — | | | | | | | | 1/5/2024 | | | | 5,149 | 10,298 | 20,596 | | 103,186 | | | 1/5/2024 | | | | | | | 10,299 | 103,196 | | Joanne C. Wu | | 0 | 270,000 | 540,000 | | | | | | | | 1/5/2024 | | | | 12,873 | 25,746 | 51,492 | | 257,975 | | | 1/5/2024 | | | | | | | 25,747 | 257,985 |
Grants of Plan-Based Awards Table
| (1) At target, represents estimated payouts for the 80% of our annual cash incentive plan for 2024 based on achievement of a pre-established financial performance metric (Adjusted EBITDA) for Mr. Giles and Ms. Wu and 100% of our annual cash incentive plan for 2024 for Mr. Barnard. Maximum payout represents 200% of target for Mr. Barnard and 180% of target for Mr. Giles and Ms. Wu. In December 2024, the Compensation Committee approved annual cash incentive payout for this component of the 2024 annual cash incentive plan at 172% of target bonus opportunity based on the Company’s achievement at 136% of target. Values do not include the amount that may be earned under our annual cash incentive plan that is based on individual performance for Mr. Giles and Ms. Wu, representing 20% of target bonus opportunity, nor the potential bonus payment to Mr. Wiesner who does not participate in our annual incentive cash plan. Amounts also do not include the cash sign-on bonus or the guaranteed annual cash bonus paid to Mr. Pawlowski pursuant to the terms of his offer letter. Due to the subjective nature of each of these potential payments, they are considered bonuses and reflected as such in the Summary Compensation Table. |
Grants of Plan-Based Awards Table
| (2) Represents PSU awards under our long-term equity incentive program which are based on achievement of a pre-established financial performance metric (cumulative adjusted net income per share) over a three-year performance period (November 1, 2023 – October 31, 2026). Awards earned, if any, vest at the end of the three-year performance period. The number of PSUs granted (which equals the target number of PSUs) will be multiplied by a payout percentage, which can range from 50% at threshold performance to 200% at maximum performance, to determine the number of PSUs earned at the end of the performance period. No amounts are earned for below threshold performance. Shares of our common stock will be issued on a one-for-one basis for each PSU earned. Our PSUs were granted under our Mission Produce, Inc. 2020 Incentive Award Plan and do not earn or accrue dividends. |
Grants of Plan-Based Awards Table
| (3) Represents RSUs that vest ratably on the first, second and third anniversary of the grant date. |
Grants of Plan-Based Awards Table
| (4) Values are calculated using the closing price of our common stock on the grant date, which was $10.02 for Messrs. Barnard, Giles, and Wiesner and Ms. Wu and $11.81 for Mr. Pawlowski. Amounts reflect the grant date fair value of equity awards computed in accordance with ASC 718, which is higher than the value approved by the Compensation Committee, as more fully described in footnote 3 to the Summary Compensation Table. |
Outstanding Equity Awards Table
Outstanding Equity Awards Table The following table sets forth certain information concerning outstanding equity awards held by the NEOs at October 31, 2024. The 2022-2024 PSUs for the three-year performance period from November 1, 2021 through October 31, 2024 resulted in a 0% payout percentage based on our cumulative adjusted net income per share performance being below threshold for the performance period that ended on October 31, 2024, and thus these awards are not reflected in the table below.
Outstanding Equity Awards Table
| | Option awards | | | | Stock awards | | | | | Name | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price($) | 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($)(1) | Equity incentive plan awards: number of unearned shares, units, or other rights have not vested(#) | Equity incentive plan awards: market or payout value of unearned shares, units, or other rights have not vested ($)(1) | | Stephen J. Barnard | 1,699,770 | — | 13.74 | 7/9/2029 | 146,422(2) | 1,727,780 | 115,774(3) | 1,366,133(3) | | | | | | | | | 123,584(4) | 1,458,291(4) | | John M. Pawlowski | — | — | — | — | 42,956(2) | 506,881 | 85,910(4) | 1,013,738(4) | | Bryan E. Giles | 120,723 | | 12.00 | 9/30/2030 | 61,384(2) | 724,331 | 39,364(3) | 464,495(3) | | | | — | | | | | 70,030(4) | 826,354(4) | | Juan A. Wiesner | 20,787 | | 12.00 | 9/30/2030 | 31,457(2) | 371,193 | 28,944(3) | 341,539(3) | | | | | | | | | 20,596(4) | 243,033(4) | | Joanne C. Wu | — | — | — | — | 46,811(2) | 552,370 | 28,944(3) | 341,539(3) | | | | | | | | | 51,492(4) | 607,606(4) |
Outstanding Equity Awards Table
| (1) Value calculated using the closing stock price of our common stock on October 31, 2024 of $11.80. |
Outstanding Equity Awards Table
| (2) Amounts include the following outstanding unvested RSUs. Each vesting is subject to the individual’s continued employment through the vesting dates. |
Outstanding Equity Awards Table
| Name | Outstanding Unvested Shares | Grant Date | Future Vesting Dates | Shares Vesting on Vesting Date | | Stephen J. Barnard | 26,743 | 1/3/2022 | 1/3/2025 | 26,743 | | | 57,887 | 1/6/2023 | 1/6/2025 and 1/6/2026 | 28,943 on the first vesting date and 28,944 on the second vesting date | | | 61,792 | 1/5/2024 | 1/5/2025, 1/5/2026, and 1/5/2027 | 20,597 on the first and second vesting dates and 20,598 on the third vesting date | | John M. Pawlowski | 42,956 | 4/5/2024 | 4/5/2025, 4/5/2026, and 4/5/2027 | 14,318 on the first vesting date and 14,319 on each of the remaining vesting dates | | Bryan E. Giles | 6,686 | 1/3/2022 | 1/3/2025 | 6,686 | | | 19,682 | 1/6/2023 | 1/6/2025 and 1/6/2026 | 9,841 on each vesting date | | | 35,016 | 1/5/2024 | 1/5/2025, 1/5/2026, and 1/5/2027 | 11,672 on each vesting date | | Juan A. Wiesner | 6,686 | 1/3/2022 | 1/3/2025 | 6,686 | | | 14,472 | 1/6/2023 | 1/6/2025 and 1/6/2026 | 7,236 on each vesting date | | | 10,299 | 1/5/2024 | 1/5/2025, 1/5/2026, and 1/5/2027 | 3,433 on each vesting date | | Joanne C. Wu | 1,912 | 3/8/2021 | 3/8/2025 | 1,912 | | | 4,680 | 1/3/2022 | 1/3/2025 | 4,680 | | | 14,472 | 1/6/2023 | 1/6/2025 and 1/6/2026 | 7,236 on each vesting date | | | 25,747 | 1/5/2024 | 1/5/2025, 1/5/2026, and 1/5/2027 | 8,582 on the first and second vesting dates and 8,583 on the third vesting date |
Outstanding Equity Awards Table
| (3) Represents our 2023-2025 PSUs granted for the three-year performance period from November 1, 2022 through October 31, 2025, multiplied by a 200% payout percentage based on maximum performance. As required by SEC rules, the maximum payout percentage is disclosed in the table because the estimated payout percentage as of October 31, 2024 is slightly above target performance. |
Outstanding Equity Awards Table
| (4) Represents our 2024-2026 PSUs granted for the three-year performance period from November 1, 2023 through October 31, 2026, multiplied by a 200% payout percentage based on maximum performance. As required by SEC rules, the maximum payout percentage is disclosed in the table because the estimated payout percentage as of October 31, 2024 is above target performance. |
Option Exercises and Stock Vested Table
Option Exercises and Stock Vested Table The following table provides information about options exercised by the NEOs and stock vested for the NEOs during the fiscal year ended October 31, 2024.
Option Exercises and Stock Vested Table
| | Option Awards | | Stock Awards | | | Name | Number of shares acquired on exercise (#) | Value realized on exercise ($)(1) | Number of shares acquired on vesting (#) | Value realized on vesting ($)(2) | | Stephen J. Barnard | — | — | 55,687 | 562,263 | | John M. Pawlowski | — | — | — | — | | Bryan E. Giles | — | — | 16,526 | 166,660 | | Juan A. Wiesner | — | — | 13,921 | 140,558 | | Joanne C. Wu | — | — | 13,827 | 141,188 |
Option Exercises and Stock Vested Table
| (1) Represents the aggregate of the closing market price at exercise, less the exercise price, for each share exercised. |
Option Exercises and Stock Vested Table
| (2) Calculated using the closing stock price on the date of vesting. |
Nonqualified Deferred Compensation Plan
Nonqualified Deferred Compensation Plan We currently offer a cash deferred compensation plan for certain of our employees, including our NEOs. Our cash deferred compensation plan provides eligible employees an opportunity to save for retirement and other purposes. Employees may defer up to 90% of their pre-tax base salary and between 10% and 100% of their annual bonus under the plan, which contribution amounts may be matched by the Company at our discretion. Matching contributions, if any, are immediately vested. Employees have an opportunity to earn returns (positive or negative) based on notional investment alternatives offered under the plan but may only earn such returns with respect to any portion of the deferral account based on a single investment option at a time (i.e., no “greater of” returns apply to any amounts deferred under the Deferred Compensation Plan, and any changes to notional investments may only be made prospectively). Employees may elect that account balances be distributed upon any or all of the following payment events: a date specified by the participant with a minimum deferral period of two years, upon a separation from service, retirement or death. In fiscal 2024, Mr. Barnard and Mr. Giles participated in our cash deferred compensation plan. The Company did not provide any matching contributions.
Nonqualified Deferred Compensation Plan
| Name | Executive contributions in fiscal 2024(1)($) | Registrant contributions in fiscal 2024 | Aggregate earnings in fiscal 2024(2)($) | Aggregate withdrawals/ distributions in fiscal 2024($) | Aggregate balance as of October 31, 2024(3)($) | | Stephen J. Barnard | 64,521 | — | 323,807 | — | 1,206,004 | | Bryan E. Giles | 105,933 | — | 84,771 | (98,536) | 402,205 |
Nonqualified Deferred Compensation Plan
| (1) These amounts represent compensation earned by the NEOs in fiscal 2024 and are also reported in the appropriate columns in the “Summary Compensation Table” above. |
Nonqualified Deferred Compensation Plan
| (2) Represents net amounts credited to the NEO’s accounts as a result of performance of the investment vehicle in which their accounts were deemed invested. These amounts do not represent above-market earnings, and thus are not reported in the “Summary Compensation Table.” |
Nonqualified Deferred Compensation Plan
| (3) Aggregate balance as of October 31, 2024 includes all contributions from earned compensation, plus investment income, through fiscal 2024. These balances include the following aggregate amounts that are reported as compensation in this proxy statement in the “Summary Compensation Table” for fiscal years 2024, 2023, and 2022: $205,052 for Mr. Barnard and $351,723 for Mr. Giles. |
Nonqualified Deferred Compensation Plan
Earnings on amounts contributed to our cash deferred compensation plan are based on participant selections among the investment options determined by the plan’s administrative committee. Participants do not have an ownership interest in the investment options they select. No fixed interest or “above market” interest rates are offered under the plan. The investment options under the deferred compensation plan and their annual cumulative rates of return for fiscal year 2024 are in the table below:
Nonqualified Deferred Compensation Plan
| Fund Name | Fiscal 2024 Cumulative Annual Returns (%) | Fund Name | Fiscal 2024 Cumulative Annual Returns (%) | | DWS RREEF Real Assets Fund - Class Inst | 9.57 | Fidelity Freedom® 2010 Fund | 5.74 | | Fidelity® Intermediate Bond Fund | 3.33 | Fidelity Freedom® 2010 Fund Class K6 | 5.92 | | Fidelity® U.S. Bond Index Fund | 1.94 | Fidelity Freedom® 2015 Fund | 6.72 | | PGIM Total Return Bond Fund -Class R6 | 3.42 | Fidelity Freedom® 2015 Fund Class K6 | 7.02 | | Fidelity® 500 Index Fund | 20.96 | Fidelity Freedom® 2020 Fund | 7.84 | | Fidelity® Leveraged Company Stock Fund | 23.65 | Fidelity Freedom® 2020 Fund Class K6 | 8.10 | | Janus Henderson Growth And Income Fund Class T | 12.76 | Fidelity Freedom® 2025 Fund | 8.80 | | Parnassus Core Equity Fund - Institutional Shares | 16.22 | Fidelity Freedom® 2025 Fund Class K6 | 9.01 | | Fidelity® Blue Chip Growth Fund | 28.77 | Fidelity Freedom® 2030 Fund | 9.68 | | Fidelity® Contrafund® | 30.86 | Fidelity Freedom® 2030 Fund Class K6 | 9.93 | | JPMorgan Large Cap Growth Fund Class R6 | 26.92 | Fidelity Freedom® 2035 Fund | 11.29 | | Dodge & Cox Stock Fund Class I | 15.98 | Fidelity Freedom® 2035 Fund Class K6 | 11.57 | | Dodge & Cox Stock Fund Class X | 16.08 | Fidelity Freedom® 2040 Fund | 13.24 | | Fidelity® Equity-Income Fund | 17.00 | Fidelity Freedom® 2040 Fund Class K6 | 13.60 | | Fidelity® Extended Market Index Fund | 12.38 | Fidelity Freedom® 2045 Fund | 14.06 | | Parnassus Mid Cap Fund | 12.51 | Fidelity Freedom® 2045 Fund Class K6 | 14.39 | | Carillon Eagle Mid Cap Growth Fund Class I | 8.06 | Fidelity Freedom® 2050 Fund | 14.08 | | MFS Mid Cap Growth Fund Class R3 | 10.58 | Fidelity Freedom® 2050 Fund Class K6 | 14.38 | | Fidelity® Value Fund | 9.82 | Fidelity Freedom® 2055 Fund | 14.04 | | John Hancock Funds Disciplined Value Mid Cap Fund Class R6 | 10.82 | Fidelity Freedom® 2055 Fund Class K6 | 14.36 | | Virtus Ceredex Mid-Cap Value Equity Fund Class I | 8.78 | Fidelity Freedom® 2060 Fund | 14.02 | | Fidelity® Stock Selector Small Cap Fund | 15.21 | Fidelity Freedom® 2060 Fund Class K6 | 14.42 | | Macquarie Small Cap Core Fund Institutional Class | 7.75 | Fidelity Freedom® 2065 Fund | 14.10 | | Fidelity® Global ex U.S. Index Fund | 8.52 | Fidelity Freedom® 2065 Fund Class K6 | 14.40 | | The Hartford International Opportunities Fund Class R6 | 10.09 | Fidelity Freedom® Income Fund | 4.75 | | Fidelity® Diversified International Fund | 9.50 | Fidelity Freedom® Income Fund Class K6 | 4.95 | | Fidelity® International Discovery Fund | 13.05 | Fidelity® Government Money Market Fund Class K6 | 4.32 | | Fidelity® Government Money Market Fund | 4.17 | Cohen & Steers Realty Shares Fund Class L | 13.10 | | Fidelity® Select Health Care Portfolio | 9.86 | Fidelity® Real Estate Investment Portfolio | 10.32 |
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control Per the terms of the Employment Agreement and Severance Plan, Mr. Barnard, Mr. Pawlowski, Mr. Giles, and Ms. Wu receive certain payments in the event of a qualifying termination and a qualifying termination within the change in control period (as defined) as set forth in the table set forth below– see Executive Employment and Severance Arrangements; Offer Letters. Mr. Wiesner does not participate in our Executive Severance Plan. Equity award treatment upon termination for Mr. Wiesner is subject to our standard award agreements which provide certain benefits as described above. Estimated Potential Payments The table below sets forth the estimated value of compensation and benefits that would be delivered to each of our NEOs upon (i) a termination by the Company without Cause or by the executive for Good Reason (a “Qualifying Termination”) within the Change in Control Period (“CIC Period”), (ii) a Qualifying Termination (not within the CIC Period), and (iii) death or disability, assuming such events occurred on October 31, 2024. This table excludes any accrued obligations and any benefits that are generally available to all employees, including fiscal year end annual cash incentive payments and bonuses, payment of accrued but unused paid time off, PSUs that are deemed earned at fiscal year-end, if any, and balances under our Deferred Compensation Plan. All equity values shown in the table below are based on the closing stock price of our common stock on October 31, 2024 of $11.80. The actual value of the equity awards that would be provided can only be determined at the time of an actual triggering event.
Potential Payments Upon Termination or Change in Control
| Name and Principal Position | Triggering Event | Cash Severance ($) | Health Benefits ($) | Equity Award Value ($) | Total ($) | | Stephen J. Barnard Chief Executive Officer | Qualifying Termination within CIC Period | 3,200,000(2) | 45,451(1) | 3,139,992(3) | 6,385,443 | | | Qualifying Termination (not within CIC Period) | 3,200,000(4) | 45,451(1) | 1,715,470(5) | 4,960,921 | | | Death or Disability | — | 285,451(9) | 698,426(6) | 983,877 | | John M. Pawlowski President and Chief Operating Officer | Qualifying Termination within CIC Period | 1,800,000(2) | 64,046(1) | 1,013,750(3) | 2,877,796 | | | Qualifying Termination (not within CIC Period) | 1,200,000(4) | 64,046(1) | 434,655(5) | 1,698,701 | | | Death or Disability | — | 2,234,046(9) | 168,956(6) | 2,403,002 | | Bryan E. Giles Chief Financial Officer | Qualifying Termination within CIC Period | 1,278,375(2) | 64,046(1) | 1,369,756(3) | 2,712,177 | | | Qualifying Termination (not within CIC Period) | 852,250(4) | 64,046(1) | 715,232(5) | 1,631,528 | | | Death or Disability | — | 1,594,046(9) | 292,557(6) | 1,886,603 | | Juan A. Wiesner President of Central and South America | Qualifying Termination within CIC Period | — | — | 426,313(7) | 426,313 | | | Qualifying Termination (not within CIC Period) | — | — | 203,198(8) | 203,198 | | | Death or Disability | — | — | 154,352(6) | 154,352 | | Joanne C. Wu General Counsel and Secretary | Qualifying Termination within CIC Period | 1,181,250(2) | 64,046(1) | 1,026,942(3) | 2,272,238 | | | Qualifying Termination (not within CIC Period) | 787,500(4) | 64,046(1) | 538,243(5) | 1,389,789 | | | Death or Disability | — | 2,914,046(9) | 215,114(6) | 3,129,160 |
Potential Payments Upon Termination or Change in Control
| (1) Represents premiums for 12-months of COBRA coverage substantially similar to that provided under the Company’s health plan. |
Potential Payments Upon Termination or Change in Control
| (2) Represents a lump sum cash payment (a) for Mr. Barnard, equal to 2.0 times the sum of his base salary plus target annual bonus, and (b) for the other NEOs, equal to 1.5 times the sum of the Covered Executive’s base salary plus target annual bonus under the annual cash incentive plan. |
Potential Payments Upon Termination or Change in Control
| (3) Represents the value of full vesting of outstanding unvested RSUs, plus the value of the outstanding 2023-2025 and 2024-2026 PSUs based on the number of PSUs earned at target level performance. In addition, stock options would be exercisable for 12 months following termination. |
Potential Payments Upon Termination or Change in Control
| (4) Represents a lump sum cash payment (a) for Mr. Barnard, equal to 2.0 times the sum of his base salary plus target annual bonus, and (b) for the other NEOs, equal to 1.0 times the sum of the Covered Executive’s base salary plus target annual bonus under the annual cash incentive plan. |
Potential Payments Upon Termination or Change in Control
| (5) Represents the value of pro- rata vesting of outstanding unvested RSUs based on days served during the vesting period, plus the value of PSUs based on the estimated number of PSUs that would have been earned based on actual performance through October 31, 2024, prorated based on days elapsed during the three-year performance period. The |
Potential Payments Upon Termination or Change in Control
payout percentages based on actual performance through October 31, 2024 were: (i) above target and below maximum performance for the 2023-2025 PSUs resulting in an estimated payout based of 107%; and (ii) at maximum level of achievement for the 2024-2026 PSUs resulting in an estimated payout of 200%. In addition, stock options would be exercisable for 12 months following termination.
Potential Payments Upon Termination or Change in Control
| (6) Represents the value of the outstanding 2023-2025 PSUs and the 2024-2026 PSUs based on the number of PSUs earned at target level performance, pro-rated based on the number of full months elapsed during the performance period. In the event of death or disability unvested RSUs are forfeited. In addition, stock options would be exercisable for 12 months following death or disability. |
Potential Payments Upon Termination or Change in Control
| (7) Based on the greater of the number of PSUs earned based on actual performance as of October 31, 2024 and target level of performance. Actual performance as of October 31, 2024 was: (i) above target and below maximum for the 2023-2025 PSUs resulting in a payout percentage of 107%; and (ii) at maximum level of achievement for the 2024-2026 PSUs resulting in a payout of 200%. |
Potential Payments Upon Termination or Change in Control
| (8) Amounts reflect the value of PSUs based on the estimated number of PSUs that would have been earned based on actual performance through October 31, 2024, prorated based on full months elapsed during the three-year performance period. Actual performance as of October 31, 2024 was: (i) above target and below maximum for the 2023-2025 PSUs resulting in a payout percentage of 107%; and (ii) at maximum level of achievement for the 2024-2026 PSUs resulting in a payout of 200%. |
Potential Payments Upon Termination or Change in Control
| (9) Represents (a) group long-term disability insurance benefits of $10,000 per month, for benefit periods which are determined based on the covered executive's age at the time of disability, and (b) premiums for 12-months of COBRA coverage substantially similar to that provided under the Company’s health plan. |
CEO Pay Ratio
CEO Pay Ratio We are required by Item 402(u) of Regulation S-K, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, to disclose the ratio of our fiscal year 2024 CEO’s annual total compensation to the median of the annual total compensation of all of our employees. The SEC’s rules for calculating this ratio allow companies to adopt a variety of methodologies, apply certain exclusions, and make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio we disclose below. We believe our fiscal year 2024 pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules and in accordance with the methodology described below.
2024 CEO Pay Ratio
2024 CEO Pay Ratio Mr. Barnard had total annual compensation, including equity-based compensation, as reported in the Summary Compensation Table, of $3,500,819 in fiscal 2024. Our median employee had total compensation of $6,567 in fiscal 2024. As a result, we estimate that the ratio of our CEO’s compensation to that of our median employee was approximately 533 to 1.
2024 CEO Pay Ratio
| Total Annual Compensation – Median Employee | Total Annual Compensation – CEO | 2024 CEO Pay Ratio | | $6,567 | $3,500,819 | 533:1 |
Pay for Performance
| (1) Amounts represent compensation actually paid to our PEO and the average compensation actually paid to our remaining NEOs for the relevant fiscal year, as determined under SEC rules (and described below), which includes the individuals indicated in the table below for each fiscal year: |
Pay for Performance
| (3) Fair value or change in fair value, as applicable, of equity awards in the “Compensation Actually Paid” columns was determined by reference to (i) for RSUs, the closing price per share on the applicable year-ends ($11.80 for October 31, 2024, $9.41 for October 31, 2023, $16.64 for October 31, 2022 and $18.99 for October 31, 2021) or, in the case of vesting dates, the closing price per share on the applicable vesting dates; (ii) for the PSUs, the fair value was calculated by multiplying the probability of achievement of the applicable performance objective as of the applicable dates by the closing price per share for the respective dates; the probability of achievement for PSUs granted on January 3, 2022 was zero as of both October 31, 2024 and 2023, and 70% as of October 31, 2022, and for PSUs granted on January 6, 2023, the probability of achievement was 102% and 60% as of October 31, 2024 and 2023, respectively, and for PSUs granted on January 5, 2024, the probability of achievement was 161% as of October 31, 2024; (iii) for stock options, a Black Scholes value as of the applicable year-end or vesting dates. A summary of Black Scholes assumptions used for the applicable year-end or vesting dates as compared to those used at grant date is set forth below: |
Narrative Disclosure to Pay Versus Performance Table
Narrative Disclosure to Pay Versus Performance Table The Company’s initial public offering (“IPO”) occurred in October 2020. Prior to our IPO, the Company did not routinely grant equity awards as part of its executive compensation packages. In 2019, the Board of Directors granted 1.7 million stock options to the PEO in connection with the anticipated IPO. In 2020, following the completion of the IPO, the Board of Directors approved a one-time stock option grant to certain employees, including three of our non-PEO NEOs at that time. In 2021, no equity awards were granted as the Company had not yet implemented its long-term equity incentive compensation program for executives. In 2022, the Compensation Committee approved the inaugural long-term incentive program comprised of a mix of RSUs and PSUs. Relationship Between Financial Performance Measures The graphs below compare the compensation actually paid to our PEO and the average of the compensation actually paid to our remaining PEOs, with (i) our cumulative TSR, (ii) our Peer Group TSR, (iii) our net (loss) income, in each case, for the fiscal years ended October 31, 2021, 2022, 2023 and 2024 and (iv) our Adjusted EBITDA for the fiscal years ended October 31, 2021, 2022, 2023 and 2024. TSR amounts reported in the graph assume an initial fixed investment of $100 on October 30, 2020 and that all dividends, if any, were reinvested. CAP versus TSR CAP versus Net Income (Loss) CAP versus Adjusted EBITDA Pay Versus Performance Tabular List We believe the following performance measures represent the most important financial performance measures used by us to link compensation actually paid to our NEOs for the fiscal year ended October 31, 2024:
Narrative Disclosure to Pay Versus Performance Table
| • | Adjusted EBITDA |
Narrative Disclosure to Pay Versus Performance Table
| • | Adjusted net income per share; and |
Narrative Disclosure to Pay Versus Performance Table
| • | Adjusted operating income |
Narrative Disclosure to Pay Versus Performance Table
For additional details regarding our most important financial performance measures, see Overview of 2024 Compensation Program for NEOs, Fiscal 2024 Compensation Decisions, and 2025 Compensation Design.