DEF 14A of Allison Transmission Holdings Inc

Filed Mar 26, 2025 · FY20240001140361-25-010358

Open on EDGAR

Majority Vote Standard for Election of Directors
Majority Vote Standard for Election of Directors Our Bylaws require directors to be elected by the majority of the votes cast with respect to that director in uncontested elections (the number of shares voted “for” a director must exceed the number of votes cast “against” that director). In a contested election (a situation in which the number of nominees exceeds the number of directors to be elected), the standard for election of directors will be a plurality of the shares represented in person or by proxy at any such meeting and entitled to vote on the election of directors. If a nominee who is serving as a director is not elected at the Annual Meeting, under Delaware law the director would continue to serve on the Board as a “holdover director.” Under our Corporate Governance Guidelines, any director who fails to be elected must tender his or her unconditional resignation to the Board. The Nominating and Corporate Governance Committee would then make a recommendation to the Board whether to accept or reject the resignation, or whether other action should be taken. The Board will act on the Nominating and Corporate Governance Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date the election results are certified. The director who tenders his or her resignation will not participate in the Board’s decision. If a nominee who was not already serving as a director is not elected at the Annual Meeting, under Delaware law that nominee would not become a director and would not serve on the Board as a “holdover director.”
Nominees for Director
Nominees for Director
Nominees for Director
| | Judy L. Altmaier, Director since February 2019 | | | Ms. Judy L. Altmaier, age 63, served as the President of Exmark Manufacturing Company Incorporated, a subsidiary of The Toro Company, or Toro, a worldwide provider of innovative solutions for the outdoor environment, from 2013 until her retirement in January 2019. Prior to that, she was Vice President, Operations and Quality Management of Toro from 2009 until 2013. Before joining Toro, Ms. Altmaier spent more than 25 years with Eaton Corporation, or Eaton, a diversified power management company, holding positions of increasing responsibility including Vice President of Operations, Auto Group Americas during 2009 and Vice President, General Manager Global Engine Valve Division in Turin, Italy from 2007 until 2009. Ms. Altmaier joined Eaton in 1983 as an accountant. Ms. Altmaier also serves on the board of directors of Enerpac Tool Group Corp. Ms. Altmaier holds a bachelor’s degree in business from Kearney State College and a Master of Business Administration from the University of Nebraska-Kearney. | | | Our Board has concluded that Ms. Altmaier should serve as a director because of her industry experience in manufacturing, operations, supply chain management, mergers and acquisitions and product development and strategy, including in the areas of automation and electrification, developed over her career with Toro and Eaton. In addition, Ms. Altmaier brings significant experience in international operations and execution of growth initiatives to our Board. | | | D. Scott Barbour, Director since May 2022 | | | Mr. D. Scott Barbour, age 63, serves as the Chief Executive Officer and President of Advanced Drainage Systems, Inc., or ADS, a manufacturer of water management solutions in the stormwater and on-site septic wastewater industries, a position he has held since September 2017. From 1989 until 2016, Mr. Barbour worked for Emerson Electric Co., or Emerson, a global technology and engineering company that provides solutions for customers in industrial, residential and commercial markets, most recently serving as President and Chief Executive Officer of its $4.5 billion Network Power business. During his tenure at Emerson, Mr. Barbour also held several leadership positions including Group Vice President of Emerson Climate Technologies, President, Emerson Climate Technologies Asia Pacific Division, and President, Emerson Climate Technologies Air Conditioning Division. Mr. Barbour received his Bachelor of Science in Mechanical Engineering from Southern Methodist University and his Master of Business Administration from the Owen Graduate School of Management, Vanderbilt University. Mr. Barbour also serves on the board of directors of ADS. | | | Our Board has concluded that Mr. Barbour should serve as a director because of his leadership capabilities and his experience in industrials, marketing, sales, engineering and product development and strategy, which he developed over his career with ADS and Emerson. In addition, Mr. Barbour brings significant experience in technology development and execution of growth initiatives to our Board. |
Nominees for Director
| 18 | | 2025 PROXY STATEMENT |
Nominees for Director
| | Philip J. Christman, Director since August 2022 | | | Mr. Philip J. Christman, age 61, served as President, Operations of Navistar, Inc., or Navistar, a leading manufacturer of commercial trucks, buses and engines, from May 2017 until his retirement in March 2022. In this role, he was responsible for all Navistar operations encompassing engineering, manufacturing, procurement and quality. He began his career with Navistar in 1986 and held various management positions of increasing responsibility in operations, engineering, procurement and strategy. Mr. Christman has a Bachelor of Science degree in Mechanical Engineering from Indiana Institute of Technology and a Master of Business Administration from Ball State University. Mr. Christman also serves on the board of directors of Broadwind, Inc. | | | Our Board has concluded that Mr. Christman should serve as a director because of his long history in, and extensive knowledge of, the commercial vehicle industry and international operations from his career at Navistar. Mr. Christman also provides important customer-focused perspectives to our Board. | | | David C. Everitt, Director since August 2014 | | | Currently retired, Mr. David C. Everitt, age 72, served as Interim Chief Executive Officer of Enviri Corporation (formerly known as Harsco Corporation), a provider of industrial services and engineered products, from February 2014 to August 2014. Prior to that, Mr. Everitt served as President of the Agriculture and Turf Division of Deere & Company, or Deere, a global leader in the production of agricultural, construction and forestry equipment and solutions, from September 2006 until his retirement in September 2012. He began his career at Deere in 1975 as an engineer and, over the next nearly four decades, held positions of increasing responsibility, most recently responsible for the sales and marketing for all of North America and Asia, as well as global design and production of John Deere tractors and turf and utility, and global Ag Solutions Systems. Mr. Everitt holds a Bachelor of Science in industrial engineering from Kansas State University. Mr. Everitt also serves on the board of directors for Brunswick Corporation, Corteva, Inc. and Enviri Corporation and previously served on the board of directors of Nutrien Ltd. and Agrium Inc. | | | Our Board has concluded that Mr. Everitt should serve as a director because of his extensive industry experience in sales, marketing and operations, particularly with respect to information technology, gained from his positions as Interim Chief Executive Officer at Harsco Corporation and the President of Deere’s largest division in the areas of engineering, manufacturing and global operations. |
Nominees for Director
| 2025 PROXY STATEMENT | | 19 |
Nominees for Director
| | David S. Graziosi, Director since May 2018 | | | Mr. David S. Graziosi, age 59, serves as Chair of the Board, a position he has held since 2021, and President and Chief Executive Officer of Allison, a position he has held since June 2018. Prior to that, Mr. Graziosi served as President, Chief Financial Officer and Assistant Secretary of Allison from January 2016 until June 2018, and Executive Vice President, Chief Financial Officer, Treasurer and Assistant Secretary since joining Allison in November 2007. Before joining Allison, between 2006 and 2007, Mr. Graziosi served as Executive Vice President and Chief Financial Officer of Covalence Specialty Materials Corporation, or Covalence. Prior to joining Covalence, Mr. Graziosi held various positions in the industry, including as Vice President of Finance Precursors and Epoxy Resins at Hexion Specialty Chemicals, Inc. from 2005 to 2006 and Executive Vice President and Chief Financial Officer at Resolution Performance Products LLC from 2004 to 2005. Prior to that, he served as Vice President and Chief Financial Officer of General Chemical Industrial Products Inc., as Finance Director of GenTek Inc., and as Internal Audit Director and Assistant Corporate Controller at Sun Chemical Group B.V. Mr. Graziosi is also a Certified Public Accountant and a Certified Information Systems Auditor (non-practicing). Mr. Graziosi holds a bachelor’s degree in business economics from the State University of New York and a Master of Business Administration from Rutgers University. | | | Our Board has concluded that Mr. Graziosi should serve as a director because of his experience with, and institutional knowledge of, Allison and his significant experience in finance, accounting, international business, operations, manufacturing and risk management. | | | Carolann I. Haznedar, Director since November 2018 | | | Ms. Carolann I. Haznedar, age 65, held various positions with E. I. du Pont de Nemours and Company, or DuPont, a global innovator of technology-based materials and solutions, from 1981 until her retirement in June 2016. During Ms. Haznedar’s most recent 18 years, she was responsible for several global businesses including Packaging and Industrial Polymers, Engineering Polymers serving the automotive industry, Kevlar® Life Protection and Specialty Fluorochemicals. Prior to these roles, she held several functional leadership roles over 10 years, with increasing responsibility. She started at DuPont in manufacturing for control systems engineering and spent seven years in manufacturing including large international plant sites. Prior to DuPont, Ms. Haznedar worked for Edo-Aire Corporation, an aviation company, where she worked on microprocessor control for nav/comm systems. Ms. Haznedar holds a bachelor’s degree in computer science/math from Montclair State University and has MBA studies from Ohio University. Ms. Haznedar also serves on the board of directors for Enviri Corporation. | | | Our Board has concluded that Ms. Haznedar should serve as a director because of her substantial operational experience and business leadership developed over her 35-year career with DuPont. In addition, Ms. Haznedar brings extensive experience in driving growth and innovation and global experience with lean organizations to our Board. |
Nominees for Director
| 20 | | 2025 PROXY STATEMENT |
Nominees for Director
| | Sasha Ostojic, Director since August 2022 | | | Mr. Sasha Ostojic, age 61, serves as a Venture Partner at Playground Global LLC, a venture capital firm specializing in early stage deep tech companies, a role he has held since April 2019. Mr. Ostojic also serves as an Adviser to the CEO at Zoox, Inc., a developer of self-driving vehicles acquired by Amazon.com, Inc. in 2020, where he also served as Interim Senior Vice President of Software between November 2021 and October 2022. Prior to these roles, he served as Senior Vice President of Engineering at Cruise LLC, a self-driving car company owned by General Motors, from October 2016 until November 2017 and as Vice President of Software for NVIDIA Corporation, a pioneer in accelerated and AI computing, from March 2011 until October 2016. Mr. Ostojic has a Bachelor of Science degree in Computer Science from San Francisco State University and a Master of Business Administration from Santa Clara University. | | | Our Board has concluded that Mr. Ostojic should serve as a director because of his experience with developing emerging technology in the automotive and other industries and delivering them to market. In addition, Mr. Ostojic’s venture capital and entrepreneurial experience provides valuable insight to the Board as we continue to execute our growth initiatives. | | | Gustave F. Perna, Director since August 2022 | | | General, United States Army (retired) Gustave F. Perna, age 64, retired from the United States Army in July 2021 as the Chief Operating Officer of Operation Warp Speed, the Trump administration’s multi-billion-dollar coronavirus vaccine and treatment effort, a position he had held since May 2020. Prior to that, General Perna served as Commanding General of United States Army Materiel Command, which develops and delivers materiel readiness solutions for the Army’s land force capabilities, from September 2016 to May 2020 and as Deputy Chief of Staff, G-4 of the Army, with responsibility for oversight of the policies and procedures used by all Army logisticians globally, from 2014 to September 2016. During his 38 years of service in the United States Army, General Perna held many other staff and command assignments, including Commander, Joint Munitions Command and Joint Munitions and Lethality Lifecycle Management Command, Commander, Defense Supply Center Philadelphia, Commander, 64th Forward Support Battalion and Commander, 4th Sustainment Brigade. General Perna holds an Associate Degree in Business Administration from Valley Forge Military Academy and a Bachelor Degree in Business Management from the University of Maryland and was awarded a Master’s Degree in Logistics Management from the Florida Institute of Technology. | | | Our Board has concluded that General Perna should serve as a director because of his valuable leadership, supply chain, logistics and international affairs experience from his nearly 40 years of service in the United States Army, including as leader of Operation Warp Speed and Commander of Army Materiel Command. In addition, General Perna brings deep knowledge of the defense industry, an important end market for Allison. |
Nominees for Director
| 2025 PROXY STATEMENT | | 21 |
Nominees for Director
| | Krishna Shivram, Director since August 2022 | | | Mr. Krishna Shivram, age 62, serves as Managing Partner in Veritec Capital Partners, a firm that invests in early to mid-stage energy technology companies, a position he has held since January 2023. Mr. Shivram served as Chief Executive Officer of Sentinel Energy Services Inc., or Sentinel, a special purpose acquisition company, a position he held from November 2017 to December 2020. Mr. Shivram also served as interim Chief Executive Officer of Weatherford International plc from November 2016 to March 2017 and Executive Vice President and Chief Financial Officer of Weatherford International plc from November 2013 until November 2016. He has over 30 years of financial and operational management experience in the energy industry and previously worked for Schlumberger Ltd. in a variety of roles across the globe, including as Vice President and Treasurer from January 2011 until November 2013. Mr. Shivram has a Bachelor of Science degree in Economics and Commerce from Sydenham College in India and is a Chartered Accountant. Mr. Shivram has served as a member of the board of directors of Ranger Energy Services, Inc., an oilfield service company, since August 2017. He also previously served on the board of directors of Sentinel, Superior Energy Services Inc. and GulfMark Offshore Inc. | | | Our Board has concluded that Mr. Shivram should serve as a director because of his experience as a Chief Financial Officer and Treasurer, as well as in corporate finance and mergers and acquisitions. In addition, Mr. Shivram’s expertise in the energy market provides our Board with valuable knowledge of an industry that impacts our global Off-Highway end markets. |
Nominees for Director
| Our Board unanimously recommends a vote FOR each of the nominees for director. |
Nominees for Director
| 22 | | 2025 PROXY STATEMENT |
Nominees for Director
| Proposal No. 2—To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2025 |
Nominees for Director
The Audit Committee has selected PricewaterhouseCoopers LLP, or PwC, as our independent registered public accounting firm for 2025. Stockholders have the opportunity to ratify that selection in an advisory non-binding vote. The Audit Committee approves all audit and permissible non-audit services to be provided to us by PwC prior to commencement of services. The Audit Committee has delegated to the Chair of the Audit Committee the authority to approve specific services up to specified individual and aggregate fee amounts. These approval decisions are presented to the full Audit Committee at the next scheduled meeting after such approvals are made. We have incurred fees for services from PwC in the below-indicated amounts for the following categories of services for the years ended December 31, 2024 and 2023, respectively:
Nominees for Director
| | 2024 | 2023 | | Audit Fees(1) | $1,377,504 | $1,360,667 | | Audit-Related Fees | — | — | | Tax Fees | — | — | | All Other Fees | — | — | | Total Fees | $1,377,504 | $1,360,667 |
Nominees for Director
| (1) Audit Fees include fees and expenses for the audit of our annual consolidated financial statements, for the review of quarterly financial statements and for services that generally only the principal auditor reasonably can provide, such as statutory and other subsidiary audits. |
Nominees for Director
We expect that representatives of PwC will be present at the Annual Meeting, will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions. The Audit Committee of our Board has the sole authority to appoint, replace, compensate and oversee the independent auditor, and shall pre-approve the fees and other terms of all engagements for audit and non-audit services provided by the independent auditor. In 2024, all of the Company’s audit fees paid to the independent auditor were pre-approved by the Audit Committee. If the holders of a majority of the voting power of the shares entitled to vote on this proposal represented virtually or by proxy do not approve the proposal, the Audit Committee will reconsider its choice, taking into consideration the views of the stockholders, and may, but will not be required to, appoint a different independent registered public accounting firm.
Nominees for Director
| Our Board unanimously recommends that stockholders vote FOR the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2025. |
Nominees for Director
| 2025 PROXY STATEMENT | | 23 |
Nominees for Director
| Report of the Audit Committee |
Nominees for Director
The Audit Committee is responsible for monitoring the integrity of the Company’s consolidated financial statements, the qualifications, performance and independence of the independent registered public accounting firm, the performance of the Company’s internal auditor and compliance with legal and regulatory requirements. The Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the work of the independent registered public accounting firm. Management is responsible for the financial reporting process, including the system of internal control, for the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States and for management’s report on internal control over financial reporting. The independent registered public accounting firm is responsible for auditing the consolidated financial statements and expressing an opinion as to their conformity with accounting principles generally accepted in the United States, as well as auditing the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. The Audit Committee’s responsibility is to oversee and review the financial reporting process and to review and discuss management’s report on internal control over financial reporting. We are not, however, professionally engaged in the practice of accounting or auditing and do not provide any expert or other special assurance as to such consolidated financial statements concerning compliance with laws, regulations or accounting principles generally accepted in the United States or as to the independence of the independent registered public accounting firm. We rely, without independent verification, on the information provided to us and on the representations made by management and the independent registered public accounting firm. We held eight meetings during 2024. The meetings were designed, among other things, to facilitate and encourage communication among the committee, management, the internal auditor and the independent registered public accounting firm, PricewaterhouseCoopers LLP, or PwC. We discussed with the internal auditor and PwC the overall scope and plans for their respective audits. We met with the internal auditor and PwC, with and without management present, to discuss the results of their examinations and their evaluations of the Company’s internal control over financial reporting. We reviewed and discussed the Company’s compliance with Section 404 of the Sarbanes-Oxley Act of 2002. We discussed with management the Company’s major financial risk exposures and the steps management has taken to monitor and control such exposures, including risk assessment and risk management processes. We reviewed and discussed the audited consolidated financial statements for the year ended December 31, 2024 with management, the internal auditor and PwC, and reviewed and discussed with management, the internal auditor and PwC management’s report on internal control over financial reporting. We reviewed PwC’s report on the Company’s consolidated financial statements, which indicated that the consolidated financial statements present fairly, in all material respects, the Company’s financial position and results of operations and cash flows in conformity with accounting principles generally accepted in the United States and PwC’s audit of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. We also discussed with management, the internal auditor and PwC the process used to support certifications by the Company’s Chief Executive Officer and Chief Financial Officer that are required by the Securities and Exchange Commission, or SEC, and the Sarbanes-Oxley Act of 2002 to accompany the Company’s periodic filings with the SEC and the process used to support management’s report on internal control over financial reporting. We also discussed with PwC all matters required to be discussed by their professional standards, including, among other things, matters related to the conduct of the audit of the Company’s consolidated financial statements and the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board, or PCAOB, and the SEC. PwC provided us with the written disclosure and the letter required by applicable PCAOB requirements and represented that PwC is independent from the Company. We discussed with PwC its independence from the Company.
Nominees for Director
| 24 | | 2025 PROXY STATEMENT |
Nominees for Director
Based on our review and these meetings, discussions and reports, and subject to the limitations on our role and responsibilities referred to above and in the Audit Committee Charter, we recommended to our Board, and our Board approved, that the Company’s audited consolidated financial statements for the year ended December 31, 2024 be included in the Company’s Annual Report on Form 10-K. We have also selected PwC as the Company’s independent registered public accounting firm for the year ended December 31, 2025 and will present the selection to the stockholders for ratification at the Annual Meeting. The Audit Committee: Krishna Shivram, Chair D. Scott Barbour Sasha Ostojic Gustave F. Perna
Nominees for Director
| 2025 PROXY STATEMENT | | 25 |
Nominees for Director
| Proposal No. 3—Approval of the amendment to our Second Amended and Restated Certificate of Incorporation to provide for exculpation of officers |
Corporate Governance Framework
| • | Align pay for performance: On average, approximately 80% of 2024 NEO total direct compensation was performance-based and was tied to financial performance and/or the performance of our stock price. On average, approximately 58% of 2024 NEO total direct compensation was equity-based, with vesting over three years. Total direct compensation was calculated as base salary, annual incentive compensation at target-level achievement and long-term incentive awards at target-level performance. |
Corporate Governance Framework
| • | Clawback Policy: Annual cash incentive compensation and performance-based long-term equity incentive awards to current and former executive officers are subject to clawback in the event of accounting restatements to correct our material noncompliance with any financial reporting requirement under securities laws. |
Corporate Governance Framework
| • | Prohibit tax gross-ups: We provide no tax gross-ups on any benefits, severance or other payments associated with a change-in-control. |
Corporate Governance Framework
| • | Prohibit option re-pricing: Our equity plan does not allow for re-pricing of underwater stock options without stockholder approval. |
Corporate Governance Framework
| • | Require double trigger for change-in-control benefits: No severance payment or equity acceleration occurs solely as the result of a change-in-control event. |
Corporate Governance Framework
| • | Retain an independent consultant: The Compensation Committee engages a compensation consultant that does not provide other services to us. |
Compensation Overview
We do not target a specific mix of compensation elements by executive, rather our overall philosophy is to emphasize performance-based pay and long-term incentives. The following charts illustrate this emphasis for our CEO and other NEOs, showing annualized base salary, target annual cash incentive opportunity and target long-term incentive opportunity as a percentage of target total direct compensation for 2024: Compensation Elements. Compensation for our executive officers consists primarily of the elements, and their corresponding objectives, identified in the following table:
Compensation Overview
| Compensation Element | Primary Objective | | Base Salary | To recognize performance of job responsibilities and to attract and retain individuals with superior talent. | | IComp (annual performance-based compensation) | To promote our near-term performance objectives across the entire workforce and reward individual contributions to the achievement of those objectives. | | Annual long-term equity incentive awards | To emphasize our long-term performance objectives, align management’s interests with those of our stockholders, encourage the maximization of stockholder value and retain key executives by providing an opportunity to participate in the ownership of the Company. | | Severance and change-in-control benefits | To encourage the continued attention and dedication of certain key individuals when considering strategic alternatives. | | Retirement savings, pension and deferred compensation plans | To provide an opportunity for tax-efficient savings and long-term financial security. | | Other elements of compensation and perquisites | To attract and retain talented executives in a cost-efficient manner by providing benefits with high perceived values at relatively low cost to us. |
2024 Compensation Decisions
2024 Compensation Decisions Base Compensation. The Compensation Committee sets base salaries for our NEOs generally at a level it deems necessary to attract and retain capable individuals, while taking into account the total compensation package provided to each NEO. Each year the Compensation Committee determines base salary adjustments based upon the scope of responsibility and demonstrated proficiency of the executive officers, and for executive officers other than the CEO, in conjunction with recommendations made by the CEO. No formulaic base salary increases are provided to the NEOs. In February 2024, the Compensation Committee approved base salary increases for each of our NEOs effective March 1, 2024 based on a review of market and peer group data and key internal considerations. Mr. Scroggins received a 7% increase to better align his base salary with the market and peer group data. Base salaries for our NEOs in 2024 were as follows:
2024 Compensation Decisions
| Name | Non-Equity Incentive Plan Compensation ($) | Individual Performance Component ($) | Total IComp ($) | Total IComp as % of Initial Target Payout Opportunity | | David S. Graziosi | 3,010,947 | — | 3,010,947 | 223.86% | | G. Frederick Bohley | 1,526,740 | 63,260 | 1,590,000 | 233.14% | | John M. Coll | 1,170,799 | 19,201 | 1,190,000 | 227.53% | | Eric C. Scroggins | 658,154 | 16,846 | 675,000 | 229.59% | | Teresa J. van Niekerk | 654,797 | 45,203 | 700,000 | 239.32% |
2024 Compensation Decisions
Long-Term Equity Incentive Awards. The Compensation Committee approves annual equity awards, which for the NEOs in 2024 were in the form of stock options, RSUs and performance units, at its first regularly scheduled meeting of each year, which typically occurs in February. Specifically, the NEOs’ annual equity awards in 2024
2024 Compensation Decisions
| Name | Target Value of Long-Term Equity Incentive Awards ($) | | David S. Graziosi | 5,580,000 | | G. Frederick Bohley | 1,550,000(1) | | John M. Coll | 706,050 | | Eric C. Scroggins | 392,000 | | Teresa J. van Niekerk | 390,000 |
2024 Compensation Decisions
| (1) Mr. Bohley received his annual equity grant on February 21, 2024, with a target value of $1,178,000. Mr. Bohley was promoted to Chief Operating Officer on June 4, 2024. In connection with his promotion, Mr. Bohley received an additional equity grant on June 4, 2024 with a target value of $372,000, increasing the total target value of his equity awards for 2024 to $1,550,000. |
2024 Compensation Decisions
The target value was then divided by a 60-day average share price to determine the number of shares to grant to our NEOs, and then one-third of those shares were allocated to stock options, one-third to RSUs and one-third to performance units. The number of shares allocated to stock options was then multiplied by three to reflect the lower value of a stock option as compared to an RSU or performance unit. As a result, our NEOs were granted the following awards:
2024 Compensation Decisions
| Name | Grant Date | Stock Options (#) | RSUs (#) | Performance Units (at Target) (#) | | David S. Graziosi | 02/22/2024 | 94,273 | 31,421 | 31,421 | | G. Frederick Bohley | 02/21/2024 | 20,010 | 6,669 | 6,669 | | | 06/04/2024 | 4,800 | 1,600 | 1,600 | | John M. Coll | 02/21/2024 | 11,993 | 3,997 | 3,997 | | Eric C. Scroggins | 02/21/2024 | 6,659 | 2,219 | 2,219 | | Teresa J. van Niekerk | 02/21/2024 | 6,625 | 2,208 | 2,208 |
2024 Compensation Decisions
The values of the awards as reported in the Summary Compensation Table are computed in accordance with Financial Accounting Standards Board’s Accounting Standards Codification Topic 718, or ASC 718. As a result, the equity award values in the Summary Compensation Table differ from the target values described above and used to calibrate the number of shares granted. Results of the 2022-2024 Performance Units. The performance units we granted to Messrs. Graziosi, Bohley, Coll and Scroggins, and Ms. van Niekerk in 2022 were based on rTSR ranking against a defined comparator group. Performance was measured from January 1, 2022 through the end of December 31, 2024 using a 20-day average share price for the starting and ending dates and including the impact from re-invested dividends. As indicated below, our three-year annualized relative performance was at the 100th percentile of the TSRs of the comparator group, resulting in a 200% payout of the units granted. The Compensation Committee certified this result in February 2025.
2024 Compensation Decisions
| Name | Relative Performance | Potential Payout | | Below Threshold | Less than 25th %ile | 0% of Target Shares | | Threshold | 25th %ile | 50% of Target Shares | | Target | 50th %ile | 100% of Target Shares | | Maximum | 75th %ile or Above | 200% of Target Shares | | Actual Performance | 100th %ile | 200% of Target Shares |
2024 Compensation Decisions
| • | Identifying a peer group of appropriately sized public companies for making market comparisons; |
2024 Compensation Decisions
| • | Reviewing and providing guidance on performance measures and objectives established for determining performance-based compensation; |
2024 Compensation Decisions
| • | Providing guidance on plan design for the Allison Transmission Holdings, Inc. 2024 Equity Incentive Award Plan, which was presented to our stockholders for approval at the 2024 annual meeting of stockholders. |
2024 Compensation Decisions
Semler Brossy does not provide other services to our management. The Compensation Committee has assessed Semler Brossy’s independence and concluded that no conflict of interest exists that would prevent Semler Brossy from providing services to the Compensation Committee. Use of Peer Group Data. The Compensation Committee reviews competitive pay practices in determining compensation for our executives, including our NEOs; however, the Compensation Committee does not target a specific percentile of market in determining individual pay levels. Rather, in alignment with the considerations described above under “Compensation Overview—Determination of Compensation Awards,” the Compensation Committee determines the total amount of compensation for our NEOs, and the allocation of total compensation among each of our three main components of compensation — base salary, IComp and long-term equity incentives — in reliance upon the judgment and general knowledge of its members and the advice of the Compensation Committee’s independent consultant to ensure we attract, develop and retain superior talent. The Compensation Committee reviewed peer group data provided by Semler Brossy in late 2023 for 2024 pay decisions for purposes of comparing our executive compensation programs and amounts to those of other publicly traded companies with size and financial characteristics similar to our own, or which operate in similar industries. The peer group is reviewed annually based on U.S. publicly traded companies in the industrial components, parts and equipment industries, with a focus on companies similar in scale to Allison with comparable financial profiles (e.g., companies with EBITDA margins higher than 15%). For pay decisions made for 2024, our peer group consisted of the following companies:
2024 Compensation Decisions
In addition, the Compensation Committee included BorgWarner Inc., Cummins Inc., Eaton Corporation plc, Parker-Hannifin Corporation, Roper Technologies, Inc. and TransDigm Group Incorporated in our 2024 peer group for the rTSR performance metric used in our performance unit awards, but otherwise excluded these companies from our 2024 peer group for comparative compensation purposes due to their larger size. In addition to the data from the peer group, the Compensation Committee also reviews pay data for similarly-sized companies from nationally recognized pay surveys for those executive positions that are not reported with sufficient frequency in the public disclosures of our peers to draw meaningful comparisons.
Employment and Severance Arrangements
Employment and Severance Arrangements The Compensation Committee considers the employment and retention of a highly capable and effective management team to be essential to protecting and enhancing the interests of the Company and our stockholders. To that end, we recognize that the uncertainty that may exist among management with respect to their “at-will” employment with us could result in the departure or distraction of management personnel to our detriment. Accordingly, the Compensation Committee has determined that severance arrangements are appropriate to encourage the continued attention and dedication of certain members of our management and to allow them to focus on the value to stockholders of strategic alternatives without concern for the impact on their continued employment. We entered into a severance and change-in-control agreement, or the Agreement, with Mr. Graziosi in March 2018, which became effective on June 1, 2018 and replaced his prior employment agreement. During 2022, the Compensation Committee approved an Executive Change-in-Control & Severance Plan, or the Severance Plan, pursuant to which our NEOs, other than Mr. Graziosi, are eligible for severance payments and benefits upon certain qualifying terminations of employment. Both the Agreement and the Severance Plan provide payments and benefits to our NEOs upon termination of employment without cause (as defined in the Agreement and the Severance Plan, respectively) or resignation of employment for good reason (as defined in the Agreement and the Severance Plan, respectively), each a Qualifying Termination, and upon a Qualifying Termination that occurs within two years following a change-in-control. The Agreement also provides payments and benefits to Mr. Graziosi upon his death, disability or retirement. For more information on the potential payments Mr. Graziosi would have received under the Agreement and Messrs. Bohley, Coll, Scroggins, and Ms. van Niekerk would have received under the Severance Plan had they experienced a Qualifying Termination, including a Qualifying Termination following a change-in-control, or had the NEOs died, became disabled or retired on December 31, 2024, see “Potential Payments upon Termination or Change-in-Control” below.
Tax Considerations
Tax Considerations Deductibility of Executive Compensation. The Compensation Committee takes into consideration the tax implications of our executive compensation program, including with respect to the tax deductibility of compensation paid under Section 162(m) of the Code. In the exercise of its business judgment, and in accordance with its compensation philosophy, the Compensation Committee continues to have flexibility to award compensation that is not tax deductible if it determines that such award is in our stockholders’ best interests and is necessary to comply with contractual commitments, or to maintain flexibility needed to attract talent, promote retention or recognize and reward desired performance. Taxation of Parachute Payments and Deferred Compensation. We do not provide and have no obligation to provide any NEO with a “gross-up” or other reimbursement payment for any tax liability that he or she might owe as a result of the application of Sections 280G, 4999, or 409A of the Code. Sections 280G and 4999 of the Code provide that executive officers and directors who hold significant equity interests and certain other service providers may be subject to an excise tax if they receive payments or benefits in connection with a change-in-control that exceed certain limits prescribed by the Code, and that the employer may forfeit a deduction on the amounts subject to this additional tax. Section 409A of the Code also may impose significant taxes on a service provider in the event that he or she receives deferred compensation that does not comply with the requirements of Section 409A of the Code. We have structured our compensation arrangements with the intention of complying with or otherwise being exempt from the requirements of Section 409A of the Code.
Equity Award Timing Policies and Practices
Equity Award Timing Policies and Practices Our general practice is to not grant equity awards in anticipation of the release of material nonpublic information or time the release of material nonpublic information for the purpose of affecting the value of executive compensation. The Compensation Committee uses its business judgment to determine the amount of an equity award and would consider any material nonpublic information that is known to the Compensation Committee before granting an equity award. Although we do not have a formal policy with respect to the timing of our equity award grants, for the last several years, the Compensation Committee has granted annual equity awards in February after our Annual Report on Form 10-K has been filed with the SEC and has granted any other equity awards on a predetermined quarterly schedule. In 2024, we did not grant stock options to our NEOs during the four business days prior to or the one business day following the filing of our periodic reports on Form 10-Q and Form 10-K or the filing or furnishing of a Current Report on Form 8-K that disclosed material nonpublic information.
Summary Compensation Table
Summary Compensation Table The following table sets forth certain information with respect to the compensation paid to our NEOs during the years ended December 31, 2024, December 31, 2023 and December 31, 2022.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($)(2) | Non- Equity Incentive Plan Compensation ($)(3) | Change in Pension Value ($) | All Other Compensation ($)(4) | Total ($) | | David S. Graziosi Chair, President and Chief Executive Officer | 2024 | 1,071,667 | — | 5,868,500 | 2,267,266 | 3,010,947 | — | 114,442 | 12,332,822 | | | 2023 | 1,041,667 | — | 4,447,041 | 1,753,054 | 2,978,981 | — | 107,882 | 10,328,625 | | | 2022 | 995,000 | — | 4,468,541 | 1,250,598 | 2,384,757 | — | 102,802 | 9,201,698 | | G. Frederick Bohley Chief Operating Officer, Chief Financial Officer and Treasurer | 2024 | 617,440 | 63,260(5) | 1,481,475 | 577,190 | 1,526,740 | 21,767 | 69,142 | 4,357,014 | | | 2023 | 604,642 | 40,409 | 963,938 | 379,988 | 1,509,591 | 85,396 | 67,028 | 3,650,992 | | | 2022 | 599,843 | 77,107 | 884,674 | 255,470 | 1,268,893 | —(6) | 65,295 | 3,151,282 | | John M. Coll Senior Vice President, Global Marketing, Sales and Service | 2024 | 520,839 | 19,201(5) | 713,504 | 276,319 | 1,170,799 | — | 78,540 | 2,779,202 | | | 2023 | 507,559 | 17,373 | 577,700 | 227,746 | 1,157,627 | — | 80,087 | 2,568,092 | | | 2022 | 491,250 | 43,293 | 588,659 | 169,989 | 944,707 | — | 77,384 | 2,315,282 | | Eric C. Scroggins Vice President, General Counsel and Assistant Secretary | 2024 | 387,667 | 16,846(5) | 396,114 | 153,423 | 658,154 | — | 55,787 | 1,667,991 | | | 2023 | 364,248 | 16,967 | 307,134 | 121,059 | 623,033 | — | 49,906 | 1,482,347 | | | 2022 | 352,615 | 23,346 | 325,035 | 93,871 | 508,654 | — | 46,967 | 1,350,488 | | Teresa van Niekerk Vice President, Chief Procurement Officer | 2024 | 388,345 | 45,203(5) | 394,150 | 152,640 | 654,797 | — | 55,136 | 1,690,271 | | | 2023 | 378,225 | 28,016 | 318,955 | 125,719 | 646,984 | — | 52,196 | 1,550,095 | | | 2022 | 365,833 | 40,014 | 337,398 | 97,441 | 527,985 | — | 48,513 | 1,417,185 |
Summary Compensation Table
| (1) Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, of all RSUs and performance units granted to the NEO in the year indicated. For a discussion of the assumptions made in the valuation of the awards, see “—Grants of Plan Based Awards for 2024—Narrative Discussion—Equity Incentive Plan Awards” below for awards granted in 2024, 2023 and 2022. |
Summary Compensation Table
For 2024, amounts shown include RSUs and performance units granted on February 22, 2024 to Mr. Graziosi and on February 21, 2024 to Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk. Additionally, it includes RSUs and performance units granted to Mr. Bohley on June 4, 2024 in connection with his promotion to Chief Operating Officer. To determine the grant date fair value of the RSUs, we used $73.39, $70.88 and $74.24, the closing market price of a share of our common stock as reported by the NYSE on the February 22, 2024 date of grant for Mr. Graziosi, on the February 21, 2024 date of grant for Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk, and on the June 4, 2024 date of grant for Mr. Bohley, respectively. Performance unit amounts represent the value at the grant date based upon the probable outcome of the performance conditions, which was the target level of performance. The following table presents the grant date fair value of the performance units included in the “Stock Awards” column and the grant date fair value of these awards assuming that the highest level of performance conditions would be achieved:
Summary Compensation Table
| Name | Grant Date Fair Value (Based on Probable Outcome ($)) | Grant Date Fair Value (Based on Maximum Performance ($)) | | Mr. Graziosi | 3,562,513 | 7,125,026 | | Mr. Bohley | 889,992 | 1,779,984 | | Mr. Coll | 430,197 | 860,394 | | Mr. Scroggins | 238,831 | 477,662 | | Ms. van Niekerk | 237,647 | 475,294 |
Summary Compensation Table
The amounts ultimately realized by the NEOs from the stock awards will depend on the price of our common stock in the future and, for performance units, the level of achievement of the performance conditions.
Summary Compensation Table
| 42 | | 2025 PROXY STATEMENT |
Summary Compensation Table
| (2) Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, of all stock option awards granted to the NEO in the year indicated. For a discussion of the assumptions made in the valuation of the awards, see “—Grants of Plan Based Awards for 2024—Narrative Discussion—Equity Incentive Plan Awards” below for stock options granted in 2024, 2023 and 2022. For 2024, amounts shown include stock options granted on February 22, 2024 to Mr. Graziosi and on February 21, 2024 to Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk. Additionally, it includes stock options granted to Mr. Bohley on June 4, 2024 in connection with his promotion to Chief Operating Officer. |
Summary Compensation Table
| (3) Represents the formulaic awards earned under our annual IComp program for the year indicated. For a discussion of the determination of these amounts, see “Compensation Discussion and Analysis—2024 Compensation Decisions—Annual Performance-Based Compensation (IComp)” above. |
Summary Compensation Table
| (4) Amounts for 2024 include the following: |
Summary Compensation Table
| | Graziosi | Bohley | Coll | Scroggins | van Niekerk | | Employer contributions under 401(k) Plan | 40,669 | 23,463 | 33,730 | 31,282 | 31,230 | | Employer contributions under Deferred Compensation Plan | 42,867 | 24,698 | 20,834 | 15,507 | 15,534 | | Company-paid life and disability insurance premiums | 7,872 | 6,600 | 11,232 | 4,131 | 3,151 | | Personal use of Company automobiles | — | — | 273 | — | — | | Company-paid Personal Umbrella Liability Insurance premiums | 2,663 | 2,663 | 2,663 | 2,663 | 2,663 | | Scholarship Voucher | — | — | — | 1,500 | — | | Wellness program rewards | 179 | 90 | — | — | — | | Vacation Payout | 20,192 | 11,628 | 9,808 | 704 | 2,558 |
Summary Compensation Table
| (5) Represents the discretionary portion of IComp payments to Messrs. Bohley, Coll and Scroggins, and Ms. van Niekerk. See “Compensation Discussion and Analysis—2024 Compensation Decisions—Annual Performance-Based Compensation (IComp)” above. |
Summary Compensation Table
| (6) Mr. Bohley’s pension value decreased by $189,003 in the calendar year ended December 31, 2022. |
Summary Compensation Table
| 2025 PROXY STATEMENT | | 43 |
Grants of Plan-Based Awards for 2024
Grants of Plan-Based Awards for 2024
Grants of Plan-Based Awards for 2024
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards ($) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | David S. Graziosi | 02/22/2024 | | | | | | | 31,421 | — | — | 2,305,987(2) | | | 02/22/2024 | | | | | | | — | 94,273 | 73.39 | 2,267,266(3) | | | 02/22/2024 | | | | 15,711 | 31,421 | 62,842 | — | — | — | 3,562,513(4) | | | — | — | 1,345,000 | 3,362,500 | | | | | | | | | G. Frederick Bohley | 02/21/2024 | | | | | | | 6,669 | — | — | 472,699(2) | | | 02/21/2024 | | | | | | | — | 20,010 | 70.88 | 461,030(3) | | | 02/21/2024 | | | | 3,335 | 6,669 | 13,338 | — | — | — | 717,784(4) | | | 06/04/2024 | | | | | | 1,600 | — | — | | 118,784(2) | | | 06/04/2024 | | | | | | | — | 4,800 | 74.24 | 116,160(3) | | | 06/04/2024 | | | | 800 | 1,600 | 3,200 | — | — | — | 172,208(4) | | | — | — | 682,000 | 1,705,000 | | | | | | | | | John M. Coll | 02/21/2024 | | | | | | | 3,997 | — | — | 283,307(2) | | | 02/21/2024 | — | | | | | | — | 11,993 | 70.88 | 276,319(3) | | | 02/21/2024 | | | | 1,999 | 3,997 | 7,994 | — | — | — | 430,197(4) | | | — | — | 523,000 | 1,307,500 | | | | | | | | | Eric C. Scroggins | 02/21/2024 | | | | | | | 2,219 | — | — | 157,283(2) | | | 02/21/2024 | | | | | | | — | 6,659 | 70.88 | 153,423(3) | | | 02/21/2024 | | | | 1,110 | 2,219 | 4,438 | — | — | — | 238,831(4) | | | — | — | 294,000 | 735,000 | . | | | | | | | | Teresa J. van Niekerk | 02/21/2024 | | | | | | | 2,208 | — | — | 156,503(2) | | | 02/21/2024 | | | | | | | — | 6,625 | 70.88 | 152,640(3) | | | 02/21/2024 | | | | 1,104 | 2,208 | 4,416 | — | — | — | 237,647(4) | | | — | — | 292,500 | 731,250 | | | | | | | |
Grants of Plan-Based Awards for 2024
| (1) Amounts shown reflect the target and maximum payout opportunities under the IComp metrics established by the Compensation Committee in February 2024 for the 2024 IComp program. |
Grants of Plan-Based Awards for 2024
Actual awards earned under our annual IComp program are paid in the year following the year on which performance is based, with the amounts determined using the base salary in effect at the time of payment. Amounts paid in March 2025 for 2024 performance were as follows:
Grants of Plan-Based Awards for 2024
| | Actual Payouts Under Non-Equity Incentive Plan Awards ($) | | Mr. Graziosi | 3,010,947 | | Mr. Bohley | 1,590,000(a) | | Mr. Coll | 1,190,000(a) | | Mr. Scroggins | 675,000(a) | | Ms. van Niekerk | 700,000(a) |
Grants of Plan-Based Awards for 2024
| (a) Includes the following amounts reported in the Bonus column of the Summary Compensation Table: Mr. Bohley—$63,260; Mr. Coll—$19,201; Mr. Scroggins—$16,846; and Ms. van Niekerk—$45,203. |
Grants of Plan-Based Awards for 2024
See “Compensation Discussion and Analysis—2024 Compensation Decisions—Annual Performance-Based Compensation (IComp)” above for a discussion of the calculation of this amount and for additional information regarding the IComp program for 2024.
Grants of Plan-Based Awards for 2024
| 44 | | 2025 PROXY STATEMENT |
Grants of Plan-Based Awards for 2024
| (2) Amounts represent the grant date fair value of RSUs granted on February 22, 2024 to Mr. Graziosi, on February 21, 2024 to Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk, and on June 4, 2024 to Mr. Bohley, as determined in accordance with ASC 718. For a discussion of the assumptions made in the valuation of our RSU awards, see “—Narrative Discussion—Equity Incentive Plan Awards” below. |
Grants of Plan-Based Awards for 2024
| (3) Amounts represent the grant date fair value of option awards granted on February 22, 2024 to Mr. Graziosi, on February 21, 2024 to Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk, and on June 4, 2024 to Mr. Bohley, as determined in accordance with ASC 718. For a discussion of the assumptions made in the valuation of our stock option awards, see “—Narrative Discussion—Equity Incentive Plan Awards” below. |
Grants of Plan-Based Awards for 2024
| (4) Amounts represent the grant date fair value of performance units granted on February 22, 2024 to Mr. Graziosi, on February 21, 2024 to Messrs. Bohley, Coll and Scroggins and Ms. van Niekerk, and on June 4, 2024 to Mr. Bohley, based upon the probable outcome of the performance conditions as determined in accordance with ASC 718. For a discussion of the assumptions made in the valuation of our performance unit awards, see “—Narrative Discussion—Equity Incentive Plan Awards” below. |
Outstanding Equity Awards at December 31, 2024
Outstanding Equity Awards at December 31, 2024 The following table provides information regarding the stock options and other equity awards held by the NEOs as of December 31, 2024.
Outstanding Equity Awards at December 31, 2024
| Name | Option Awards | | | | Stock Awards | | | | | | 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 (#)(7) | Market Value of Shares or Units of Stock That Have Not Vested ($)(8) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(9) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(10) | | David S. Graziosi | —(1) | 44,301(1) | 38.11 | 2/24/2032 | | | | | | | 18,004(2) | 80,505(2) | 47.35 | 2/22/2033 | | | | | | | — | 94,273(3) | 73.39 | 2/22/2034 | | | | | | | | | | | 163,558 | 17,674,077 | 143,346 | 15,489,969 | | G. Frederick Bohley | 10,348 | — | 23.59 | 2/16/2026 | | | | | | | 3,961 | — | 37.11 | 2/22/2027 | | | | | | | 5,787 | — | 43.30 | 2/07/2028 | | | | | | | 4,959 | — | 41.86 | 6/01/2028 | | | | | | | 11,052 | — | 49.60 | 2/20/2029 | | | | | | | 18,594 | — | 43.24 | 2/25/2030 | | | | | | | 21,974 | — | 43.13 | 2/10/2031 | | | | | | | 17,316(4) | 8,658(4) | 39.42 | 2/23/2032 | | | | | | | 8,725(2) | 17,450(2) | 47.35 | 2/22/2033 | | | | | | | — | 20,010(5) | 70.88 | 2/21/2034 | | | | | | | — | 4,800(6) | 74.24 | 6/04/2034 | | | | | | | | | | | 34,691 | 3,748,709 | 33,988 | 3,672,743 | | John M. Coll | 8,802 | — | 37.11 | 2/22/2027 | | | | | | | 11,223 | — | 43.30 | 2/07/2028 | | | | | | | 11,052 | — | 49.60 | 2/20/2029 | | | | | | | 12,361 | — | 43.24 | 2/25/2030 | | | | | | | 14,622 | — | 43.13 | 2/10/2031 | | | | | | | 11,522(4) | 5,761(4) | 39.42 | 2/23/2032 | | | | | | | 5,229(2) | 10,459(2) | 47.35 | 2/22/2033 | | | | | | | — | 11,993(5) | 70.88 | 2/21/2034 | | | | | | | | | | | 21,169 | 2,287,522 | 18,452 | 1,993,923 | | Eric C. Scroggins | — | 3,182(11) | 39.42 | 2/23/2032 | | | | | | | — | 5,560(12) | 47.35 | 2/22/2033 | | | | | | | — | 6,659(5) | 70.88 | 2/21/2034 | | | | | | | | | | | 11,626 | 1,256,306 | 9,998 | 1,080,384 | | Teresa J. van Niekerk | — | 3,303(11) | 39.42 | 2/23/2032 | | | | | | | — | 5,774(12) | 47.35 | 2/22/2033 | | | | | | | — | 6,625(5) | 70.88 | 2/21/2034 | | | | | | | | | | | 11,971 | 1,293,586 | 10,190 | 1,101,131 |
Outstanding Equity Awards at December 31, 2024
| (1) Represents the final tranche of this stock option grant, which vested on February 24, 2025. |
Outstanding Equity Awards at December 31, 2024
| (2) The option vests in three equal annual installments beginning on February 22, 2024. |
Outstanding Equity Awards at December 31, 2024
| (3) The option vests in three equal annual installments beginning on February 22, 2025. |
Outstanding Equity Awards at December 31, 2024
| (4) The option vests in three equal annual installments beginning on February 23, 2023. |
Outstanding Equity Awards at December 31, 2024
| (5) The option vests in three equal annual installments beginning on February 21, 2025. |
Outstanding Equity Awards at December 31, 2024
| (6) The option vests in three equal annual installments beginning on June 4, 2025. |
Outstanding Equity Awards at December 31, 2024
| (7) The amounts in the “Number of Shares or Units of Stock That Have Not Vested” column include the number of shares of common stock underlying unvested RSUs, the number of shares vesting in February 2025 for the 2022-2024 performance units at the actual payout amount, and the number of any dividend equivalents on such RSUs and performance units for all NEOs. |
Outstanding Equity Awards at December 31, 2024
| 2025 PROXY STATEMENT | | 47 |
Outstanding Equity Awards at December 31, 2024
| (8) Calculated by multiplying (a) the number of shares of RSUs that have not vested, plus (b) the number of shares vesting in February 2025 for the 2022-2024 performance units at the actual payout amount for such performance units, plus (c) any dividend equivalents on such RSUs and performance units, by $108.06, the closing price of a share of our common stock on December 31, 2024, as reported by the NYSE. As of December 31, 2024, the relevant performance criteria for the 2022-2024 performance units had been satisfied, but the awards did not vest until February 28, 2025. The table below shows the vesting dates for the number of shares of common stock underlying unvested awards: |
Outstanding Equity Awards at December 31, 2024
| | Vesting Date | RSUs (#) | 2022-2024 Performance Units | Dividend Equivalents (#) | | Mr. Graziosi | 02/24/2025 | 14,767 | | 767 | | | 02/22/2025 | 13,417 | | 405 | | | 02/22/2026 | 13,418 | | 405 | | | 02/22/2025 | 10,473 | | 119 | | | 02/22/2026 | 10,474 | | 119 | | | 02/22/2027 | 10,474 | | 120 | | | 02/28/2025 | | 88,600 | | | Mr. Bohley | 02/23/2025 | 2,886 | | 147 | | | 02/22/2025 | 2,908 | | 86 | | | 02/22/2026 | 2,909 | | 87 | | | 02/21/2025 | 2,223 | | 25 | | | 02/21/2026 | 2,223 | | 25 | | | 02/21/2027 | 2,223 | | 26 | | | 06/04/2025 | 533 | | 2 | | | 06/04/2026 | 533 | | 2 | | | 06/04/2027 | 534 | | 3 | | | 02/28/2025 | | 17,316 | | | Mr. Coll | 02/23/2025 | 1,921 | | 97 | | | 02/22/2025 | 1,743 | | 51 | | | 02/22/2026 | 1,743 | | 51 | | | 02/21/2025 | 1,332 | | 14 | | | 02/21/2026 | 1,332 | | 15 | | | 02/21/2027 | 1,333 | | 15 | | | 02/28/2025 | | 11,522 | | | Mr. Scroggins | 02/23/2025 | 1,061 | | 51 | | | 02/22/2025 | 927 | | 27 | | | 02/22/2026 | 927 | | 28 | | | 02/21/2025 | 739 | | 8 | | | 02/21/2026 | 740 | | 8 | | | 02/21/2027 | 740 | | 8 | | | 02/28/2025 | | 6,362 | | | Ms. van Niekerk | 02/23/2025 | 1,101 | | 54 | | | 02/22/2025 | 962 | | 28 | | | 02/22/2026 | 963 | | 28 | | | 02/21/2025 | 736 | | 7 | | | 02/21/2026 | 736 | | 8 | | | 02/21/2027 | 736 | | 8 | | | 02/28/2025 | | 6,604 | |
Outstanding Equity Awards at December 31, 2024
| 48 | | 2025 PROXY STATEMENT |
Outstanding Equity Awards at December 31, 2024
| (9) Includes unearned performance units granted in 2023 and 2024. The number of shares reported is calculated based on the actual performance results for the performance units under the applicable performance measures through the end of 2024 and assuming that the payout will occur at the next highest level (threshold, target or maximum). As of December 31, 2024, the performance units granted in 2023 and 2024 were tracking above target and are presented at the maximum level. |
Outstanding Equity Awards at December 31, 2024
| | Vesting Date | Performance Units (#) | | Mr. Graziosi | No later than 02/28/2026 | 80,504 | | | No later than 02/28/2027 | 62,842 | | Mr. Bohley | No later than 02/28/2026 | 17,450 | | | No later than 02/28/2027 | 16,538 | | Mr. Coll | No later than 02/28/2026 | 10,458 | | | No later than 02/28/2027 | 7,994 | | Mr. Scroggins | No later than 02/28/2026 | 5,560 | | | No later than 02/28/2027 | 4,438 | | Ms. van Niekerk | No later than 02/28/2026 | 5,774 | | | No later than 02/28/2027 | 4,416 |
Outstanding Equity Awards at December 31, 2024
| (10) Calculated by multiplying the projected performance unit achievement by $108.06, the closing price of a share of our common stock on December 31, 2024, as reported by the NYSE. |
Outstanding Equity Awards at December 31, 2024
| (11) Represents the final tranche of this stock option grant, which vested on February 23, 2025. |
Outstanding Equity Awards at December 31, 2024
| (12) Represents the final two tranches of this stock option grant, which will vest in equal installments on February 22, 2025 and February 22, 2026. |
Outstanding Equity Awards at December 31, 2024
| 2025 PROXY STATEMENT | | 49 |
Options Exercised and Stock Vested during 2024
Options Exercised and Stock Vested during 2024
Options Exercised and Stock Vested during 2024
| Name | Option Awards | | Stock Awards | | | | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($) | | David S. Graziosi | 225,326 | 8,172,801 | 104,714 | 7,683,147 | | G. Frederick Bohley | 7,150 | 306,036 | 20,487 | 1,503,285 | | John M. Coll | — | — | 13,435 | 985,828 | | Eric C. Scroggins | 8,649 | 257,636 | 7,374 | 541,104 | | Teresa J. van Niekerk | 8,949 | 284,129 | 7,592 | 557,127 |
Options Exercised and Stock Vested during 2024
| (1) Includes performance units, RSUs and dividend equivalents that vested as follows: |
Options Exercised and Stock Vested during 2024
| | Date | Performance Units (#) | RSUs (#) | Dividend Equivalents (#) | | Mr. Graziosi | 02/10/2024 | — | 12,720 | 770 | | | 02/22/2024 | — | 13,417 | 248 | | | 02/24/2024 | — | 14,767 | 593 | | | 02/28/2024 | 62,199 | — | — | | Mr. Bohley | 02/10/2024 | — | 2,442 | 145 | | | 02/22/2024 | — | 2,908 | 53 | | | 02/23/2024 | — | 2,886 | 114 | | | 02/28/2024 | 11,939 | — | — | | Mr. Coll | 02/10/2024 | — | 1,625 | 96 | | | 02/22/2024 | — | 1,743 | 31 | | | 02/23/2024 | — | 1,920 | 76 | | | 02/28/2024 | 7,944 | — | — | | Mr. Scroggins | 02/10/2024 | — | 897 | 51 | | | 02/22/2024 | — | 926 | 16 | | | 02/23/2024 | — | 1,060 | 41 | | | 02/28/2024 | 4,383 | — | — | | Ms. van Niekerk | 02/10/2024 | — | 920 | 52 | | | 02/22/2024 | — | 962 | 17 | | | 02/23/2024 | — | 1,101 | 42 | | | 02/28/2024 | 4,498 | — | — |
Pension Benefits for 2024
Pension Benefits for 2024 The following table sets forth information regarding the accrued pension benefits for the NEOs for 2024 under our defined benefit plan.
Pension Benefits for 2024
| Name | Plan Name | Number of Years Credited Service (#) | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | | G. Frederick Bohley | Allison Transmission Retirement Program for Salaried Employees | 17.4 | 548,255 | — |
Pension Benefits for 2024
Mr. Bohley participates in our defined benefit plan. Messrs. Graziosi, Coll and Scroggins, and Ms. van Niekerk did not commence service with our predecessor prior to January 1, 2007 and are therefore not eligible to participate in our defined benefit plan. For a description of this plan, see “Compensation Discussion and Analysis—Defined Benefit Plan” above.
Pension Benefits for 2024
| 50 | | 2025 PROXY STATEMENT |
Pension Benefits for 2024
For information with respect to the valuation methods and material assumptions applied in quantifying the present value of the accrued benefits under the defined benefit plan, see Note 15 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.
Nonqualified Deferred Compensation for 2024
Nonqualified Deferred Compensation for 2024 The following table sets forth information regarding the nonqualified deferred compensation for the NEOs for 2024 under our Deferred Compensation Plan. For a description of this plan, see “Compensation Discussion and Analysis—Deferred Compensation Plan” above.
Nonqualified Deferred Compensation for 2024
| Name | Executive Contributions in Last FY ($)(1) | Registrant Contributions in Last FY ($)(2) | Aggregate Earnings in Last FY ($)(3) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($)(4) | | David S. Graziosi | 53,583 | 42,867 | 114,124 | — | 1,714,021 | | G. Frederick Bohley | 30,872 | 24,698 | 153,509 | — | 802,716 | | John M. Coll | 84,793 | 20,834 | 44,801 | — | 442,826 | | Eric C. Scroggins | 19,383 | 15,507 | 78,390 | — | 560,384 | | Teresa J. van Niekerk | 38,835 | 15,534 | 50,944 | — | 381,374 |
Nonqualified Deferred Compensation for 2024
| (1) The amounts shown in this column are reported in the Summary Compensation Table as follows: |
Nonqualified Deferred Compensation for 2024
| | Amount Reported in the Summary Compensation Table as part of Salary for 2024 ($) | Amount Reported in the Summary Compensation Table as part of Non-Equity Incentive Plan Compensation for 2023 ($) | Amount Reported in the Summary Compensation Table as part of Bonus for 2023 ($) | | Mr. Graziosi | 53,583 | — | — | | Mr. Bohley | 30,872 | — | — | | Mr. Coll | 26,042 | 27,853 | 30,898 | | Mr. Scroggins | 19,383 | — | — | | Ms. van Niekerk | 38,835 | — | — |
Nonqualified Deferred Compensation for 2024
| (2) The amounts shown in this column are reported in the Summary Compensation Table for 2024 as part of All Other Compensation. |
Nonqualified Deferred Compensation for 2024
| (3) The amounts shown in this column are not reported as compensation in the Summary Compensation Table as they do not represent above-market or preferential earnings on deferred compensation. |
Nonqualified Deferred Compensation for 2024
| (4) Of the amounts shown in this column, the following amounts are reported in the Summary Compensation Table: |
Nonqualified Deferred Compensation for 2024
| | Aggregate Amount Reported in the Summary Compensation Table of this Proxy Statement for 2024 ($) | Aggregate Amount Reported in the Summary Compensation Table of this Proxy Statement for 2023 ($) | Aggregate Amount Reported in the Summary Compensation Table of this Proxy Statement for 2022 ($) | | Mr. Graziosi | 96,450 | 93,750 | 89,550 | | Mr. Bohley | 55,570 | 54,417 | 53,986 | | Mr. Coll | 105,627 | 95,080 | 96,213 | | Mr. Scroggins | 34,890 | 32,782 | 31,736 | | Ms. van Niekerk | 54,368 | 34,040 | 32,925 |
Nonqualified Deferred Compensation for 2024
| 2025 PROXY STATEMENT | | 51 |
Potential Payments upon Termination or Change-in-Control
Potential Payments upon Termination or Change-in-Control Graziosi Severance and Change-in-Control Agreement. Mr. Graziosi’s Agreement, which became effective on June 1, 2018, provides that:
Potential Payments upon Termination or Change-in-Control
| • | upon a Qualifying Termination, Mr. Graziosi will be entitled to receive (i) severance payments equal to two times the sum of his annual base salary and the greater of (x) the average annual bonus earned by him for the three years prior to the year of termination and (y) his target annual bonus; (ii) continued healthcare coverage for 24 months; and (iii) extension of the post-termination exercise period of any stock options granted under our equity compensation plans until the second anniversary of such termination, subject, in each case, to Mr. Graziosi executing a general release of claims against the Company. |
Potential Payments upon Termination or Change-in-Control
| • | if Mr. Graziosi’s Qualifying Termination occurs within two years following a change-in-control, Mr. Graziosi will be entitled to receive, in addition to the severance payments and benefits described above, (i) an additional payment equal to the sum of his annual base salary and the greater of (x) the average annual bonus earned by him for the three years prior to the year of termination and (y) his target annual bonus; and (ii) continued healthcare coverage for an additional 12 months. |
Potential Payments upon Termination or Change-in-Control
| • | if Mr. Graziosi’s employment is terminated due to his disability or death, he will be entitled to receive the greater of (x) the average annual bonus earned by him for the three years prior to the year of termination and (y) his target annual bonus, in each case, prorated for his partial year of service, subject, in the event of his termination due to disability, to Mr. Graziosi executing a general release of claims against the Company. |
Potential Payments upon Termination or Change-in-Control
| • | if Mr. Graziosi's employment is terminated due to his retirement, he will be entitled to receive a prorated portion of his annual bonus, with the amount earned calculated based on our actual performance for the year of his retirement. Mr. Graziosi is currently retirement eligible. |
Potential Payments upon Termination or Change-in-Control
| • | in addition, any equity or equity-based awards granted under our equity compensation plans will be treated in accordance with the documents governing such awards upon a Qualifying Termination, a Qualifying Termination within two years following a change-in-control or Mr. Graziosi’s death, disability or retirement. |
Potential Payments upon Termination or Change-in-Control
As a condition to the effectiveness of the Agreement, Mr. Graziosi executed a confidentiality, restrictive covenant and proprietary rights agreement, which contains provisions regarding the protection of confidential information, assignment of inventions and a covenant pursuant to which Mr. Graziosi has agreed not to compete with certain of our businesses during the term of his employment and for 24 months following his termination for any reason. Severance Plan. The Severance Plan was approved by the Compensation Committee in July 2022 and provides severance payments and benefits to certain senior level employees who the Compensation Committee designates as eligible to participate in the Severance Plan. The purpose of the Severance Plan is to ensure the continued dedication of key employees by providing severance protections to such participants in the event their employment is terminated under the circumstances designated in the Severance Plan. During 2022, the Compensation Committee designated each of our NEOs, other than Mr. Graziosi, as eligible to participate and determined each NEO’s classification as either a Tier 1 or Tier 2 participant, which determines the level of benefits under the Severance Plan. Under the Severance Plan, a Tier 2 participant who experiences a Qualifying Termination at any time or a Tier 1 participant who experiences a Qualifying Termination other than within two years after a change-in-control, or a Non-CIC Qualifying Termination, is eligible to receive (i) a lump sum payment in an amount equal to (a) the participant’s annual base salary plus his or her target bonus amount for Tier 1 participants (including Messrs. Bohley and Coll) or (b) the participant’s annual base salary plus a pro-rata target bonus amount for Tier 2 participants (including Ms. van Niekerk and, for a Non-CIC Qualifying Termination only, Mr. Scroggins); and (ii) payment or reimbursement of premiums for continued group medical plan coverage for a period of up to one year following termination. If a Tier 1 participant experiences a Qualifying Termination within two years after a change-in-control, or a CIC Qualifying Termination, the Tier 1 participant (including Messrs. Bohley, Coll and Scroggins) is eligible to receive (A) a lump sum payment in an amount equal to two-times the participant’s annual base salary plus his or her target bonus amount; (B) payment or reimbursement of premiums for continued group medical plan coverage for a period of up to two years; and (C) accelerated vesting of all unvested equity or equity-based awards granted to the participant and extension of the post-termination exercise period of
Potential Payments upon Termination or Change-in-Control
| 52 | | 2025 PROXY STATEMENT |
Potential Payments upon Termination or Change-in-Control
outstanding stock options until the second anniversary of such CIC Qualifying Termination (but in no event later than the maximum term of the option and otherwise subject to the terms of the applicable equity plan), provided that, unless a provision more favorable to the participant is included in an applicable award agreement, any such awards that are subject to performance-based vesting conditions shall only be payable subject to the attainment of the performance measures for the applicable performance period as provided under the terms of the applicable award agreement. See “Equity Awards” below for additional information on the treatment of outstanding performance units in connection with a change-in-control and certain terminations of employment occurring after a change-in-control. The NEOs are required to execute a general release of claims as a condition to receiving severance payments and benefits under the Severance Plan and to comply with any non-competition, non-solicitation, non-disparagement and confidentiality agreements with us. Equity Awards. Under the terms of our currently outstanding performance units, in connection with a change-in-control, such performance units are only eligible to vest at the end of the original performance period based on actual performance against the rTSR metrics measured as of the change-in-control and subject to the grantee’s continued service through the end of the original performance period; provided that, such earned performance units will immediately vest in connection with a Qualifying Termination or a termination due to death or disability, in each case, that occurs after the change-in-control. In addition, for the outstanding performance units granted in 2023 and 2024, such performance units will vest upon the grantee’s death or disability prior to the end of the applicable performance period, with the number of performance units vesting calculated based on our actual performance through the date of termination, prorated based on the number of days in the performance period that elapsed prior to such termination, pursuant to the terms of the award agreements governing such performance units. For the RSUs and stock options granted in 2024, upon a NEO’s retirement, a prorated portion of the current tranche of such RSUs and stock options will vest upon retirement, pursuant to the terms of the award agreements governing such RSUs and stock options. For the performance units granted in 2024, in the event of a NEO’s retirement prior to the end of the performance period, a prorated portion of the performance units will vest after the end of the performance period on the date that the number of performance units earned is determined, with the number of performance units vesting calculated based on our actual performance for the performance period, prorated based on the number of days in the performance period that elapsed prior to such retirement, pursuant to the terms of the award agreements governing such performance units. Each of our NEOs is currently retirement eligible. Assuming a termination of employment effective as of December 31, 2024 (i) by us without cause or due to Mr. Graziosi’s resignation for good reason, (ii) by us without cause or due to Mr. Graziosi’s resignation for good reason following a change-in-control, (iii) due to death or disability, or (iv) due to retirement, Mr. Graziosi would have received the following severance payments and benefits:
Potential Payments upon Termination or Change-in-Control
| Name | Payment Type | Termination Without Cause or Resignation for Good Reason ($) | Termination Without Cause or Resignation for Good Reason following a Change-in-Control ($) | Termination Due to Death or Disability ($) | Termination Due to Retirement ($) | | David S. Graziosi | Salary | 2,152,000 | 3,228,000 | — | — | | | Bonus | 5,583,124 | 8,374,686 | 2,791,562 | 3,010,947 | | | Stock Options (Accelerated)(1) | — | 11,254,758 | — | 934,268 | | | RSUs (Accelerated)(2) | — | 8,099,961 | — | 981,602 | | | Performance Units (Accelerated)(3) | — | 25,064,085 | 8,063,077 | 1,130,752 | | | Benefit Continuation(4) | 44,036 | 68,730 | — | — | | | Total | 7,779,160 | 56,090,220 | 10,854,639 | 6,057,569 |
Potential Payments upon Termination or Change-in-Control
| (1) Amount represents the value of unvested “in-the-money” stock options held by Mr. Graziosi that would vest as a result of the specified termination event. Value is calculated by multiplying the number of such unvested stock options that would vest by the difference between $108.06, the closing price of our common stock on the NYSE on December 31, 2024, and the exercise price of such stock options. |
Potential Payments upon Termination or Change-in-Control
| 2025 PROXY STATEMENT | | 53 |
Potential Payments upon Termination or Change-in-Control
| (2) Amount represents the value of unvested RSUs and dividend equivalents held by Mr. Graziosi that would vest as a result of the specified termination event. Value is calculated by multiplying the number of unvested RSUs and dividend equivalents that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
| (3) Amount represents the value of Mr. Graziosi’s unvested performance units that would vest as a result of the specified termination event, pursuant to the terms of his applicable award agreements. For the performance units granted in 2024, in the event of Mr. Graziosi’s retirement prior to the end of the performance period, a prorated portion of the performance units will vest after the end of the performance period on the date that the number of performance units earned is determined, with the number of performance units vesting calculated based on our actual performance for the performance period, prorated based on the number of days in the performance period that elapsed prior to such retirement. For purposes of this table, we have assumed that we will achieve target performance for the performance period. Value is calculated by multiplying the number of such unvested performance units that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
| (4) Consists of continuation of group health benefits. The value of the health benefits was calculated using an estimate of the cost to us of such health coverage based upon past experience. |
Potential Payments upon Termination or Change-in-Control
| 54 | | 2025 PROXY STATEMENT |
Potential Payments upon Termination or Change-in-Control
Messrs. Bohley, Coll and Scroggins, and Ms. van Niekerk are all participants in the Severance Plan, which provides for severance benefits upon (i) a termination of employment by us without cause or by the executive for good reason, or (ii) a termination of employment by us without cause or by the executive for good reason within two years following a change-in-control. See “Severance Plan” above. In addition, pursuant to the terms of the award agreements for the performance units granted in 2023 and 2024, Messrs. Bohley, Coll and Scroggins, and Ms. van Niekerk would be entitled to prorated vesting upon their termination due to death and disability. Pursuant to the terms of the award agreements for the RSUs, stock options and performance units granted in 2024, Messrs. Bohley, Coll and Scroggins, and Ms. van Niekerk would be entitled to prorated vesting in connection with their retirement. See “Equity Awards” above. Assuming a termination of employment had occurred on December 31, 2024, Messrs. Bohley, Coll and Scroggins, and Ms. van Niekerk would have received the following severance payments and benefits:
Potential Payments upon Termination or Change-in-Control
| Name | Payment Type | Termination Without Cause or for Good Reason ($) | Termination Without Cause or Resignation for Good Reason following a Change- in-Control ($) | Termination Due to Death or Disability ($) | Termination Due to Retirement ($) | | G. Frederick Bohley | Salary | 620,000 | 1,240,000 | — | — | | | Bonus | 682,000 | 1,364,000 | — | 1,526,740 | | | RSUs (Accelerated)(1) | — | 1,877,543 | — | 242,311 | | | Stock Options (Accelerated)(2) | — | 2,559,982 | — | 244,473 | | | Performance Units (Accelerated)(3) | — | 5,543,910 | 1,852,797 | 297,578 | | | Benefit Continuation(4) | 25,834 | 53,735 | — | — | | | Total | 1,327,834 | 12,639,170 | 1,852,797 | 2,311,102 | | John M. Coll | Salary | 523,000 | 1,046,000 | — | — | | | Bonus | 523,000 | 1,046,000 | — | 1,170,799 | | | RSUs (Accelerated)(1) | — | 1,042,455 | — | 125,219 | | | Stock Options (Accelerated)(2) | — | 1,476,301 | — | 127,865 | | | Performance Units (Accelerated)(3) | — | 3,238,990 | 1,041,338 | 143,841 | | | Benefit Continuation(4) | 25,834 | 53,735 | — | — | | | Total | 1,071,834 | 7,903,481 | 1,041,338 | 1,567,724 | | Eric C. Scroggins | Salary | 392,000 | 784,000 | — | — | | | Bonus | 294,000 | 588,000 | — | 658,154 | | | RSUs (Accelerated)(1) | — | 568,828 | — | 69,504 | | | Stock Options (Accelerated)(2) | — | 803,542 | — | 70,996 | | | Performance Units (Accelerated)(3) | — | 1,767,862 | 560,399 | 79,855 | | | Benefit Continuation(4) | — | — | — | — | | | Total | 686,000 | 4,512,232 | 560,399 | 878,509 | | Teresa J. van Niekerk | Salary | 390,000 | 390,000 | — | — | | | Bonus | 292,500 | 292,500 | — | 654,797 | | | RSUs (Accelerated)(5) | — | 579,958 | — | 69,132 | | | Stock Options (Accelerated)(6) | — | 823,575 | — | 70,634 | | | Performance Units (Accelerated)(7) | — | 1,814,760 | 575,023 | 79,460 | | | Benefit Continuation(4) | — | — | — | — | | | Total | 682,500 | 3,900,793 | 575,023 | 874,023 |
Potential Payments upon Termination or Change-in-Control
| (1) Amounts represent the value of unvested RSUs and dividend equivalents held by the NEO that would vest as a result of the specified termination event. Value is calculated by multiplying the number of unvested RSUs and dividend equivalents that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
| 2025 PROXY STATEMENT | | 55 |
Potential Payments upon Termination or Change-in-Control
| (2) Amount represents the value of unvested “in-the-money” stock options held by the NEO that would vest as a result of the specified termination event. Value is calculated by multiplying the number of such unvested stock options that would vest by the difference between $108.06, the closing price of our common stock on the NYSE on December 31, 2024, and the exercise price of such stock options. |
Potential Payments upon Termination or Change-in-Control
| (3) Under the terms of the Severance Plan, unvested performance units continue to vest in accordance with their terms as a result of a termination by us without cause or by the NEO for good reason following a change-in-control, unless a provision more favorable to the NEO is included in an applicable award agreement. This amount represents the value of unvested performance units (i) granted on February 22, 2023, February 21, 2024 and June 4, 2024 to the NEO that would vest as a result of such termination event based on our actual performance as of December 31, 2024, the assumed date of such termination event, which was at the maximum level of performance; and (ii) granted on February 23, 2022 to the NEO that would vest as a result of such termination event and for which actual performance during the performance period ended December 31, 2024 was 200%. In addition, for the outstanding performance units granted in 2024 and 2023, such performance units will vest upon the NEO’s death or disability prior to the end of the applicable performance period, with the number of performance units vesting calculated based on our actual performance through the date of termination, prorated based on the number of days in the performance period that elapsed prior to such termination, pursuant to the terms of the award agreements governing such performance units. For the performance units granted in 2024, in the event of the NEO’s retirement prior to the end of the performance period, a prorated portion of the performance units will vest after the end of the performance period on the date that the number of performance units earned is determined, with the number of performance units vesting calculated based on our actual performance for the performance period, prorated based on the number of days in the performance period that elapsed prior to such retirement. For purposes of this table, we have assumed that we will achieve target performance for the performance period. Value is calculated by multiplying the number of such unvested performance units that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
| (4) Consists of continuation of group health benefits. The value of the health benefits was calculated using an estimate of the cost to us of such health coverage based upon past experience. Even though Mr. Scroggins and Ms. van Niekerk are eligible to receive the continuation of group health benefits under the Severance Plan, they did not participate in our group health benefits as of December 31, 2024, so no amounts are included for either in this row. |
Potential Payments upon Termination or Change-in-Control
| (5) Amount represents the value of unvested RSUs and dividend equivalents held by Ms. van Niekerk that would vest as a result of the specified termination event, pursuant to the terms of her applicable award agreements. Value is calculated by multiplying the number of such unvested RSUs that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
| (6) Amount represents the value of unvested “in-the-money” stock options held by Ms. van Niekerk that would vest as a result of the specified termination event, pursuant to the terms of her applicable award agreements. Value is calculated by multiplying the number of such unvested stock options that would vest by the difference between $108.06, the closing price of our common stock on the NYSE on December 31, 2024, and the exercise price of such stock options. |
Potential Payments upon Termination or Change-in-Control
| (7) Amount represents the value of unvested performance units held by Ms. van Niekerk that would vest as a result of the specified termination event, pursuant to the terms of her applicable award agreements. For the performance units granted in 2024, in the event of Ms. van Niekerk’s retirement prior to the end of the performance period, a prorated portion of such performance units will vest after the end of the performance period on the date that the number of performance units earned is determined, with the number of performance units vesting calculated based on our actual performance for the performance period, prorated based on the number of days in the performance period that elapsed prior to such retirement. For purposes of this table, we have assumed that we will achieve target performance for the performance period. Value is calculated by multiplying the number of such unvested performance units that would vest by $108.06, the closing price of our common stock on the NYSE on December 31, 2024. |
Potential Payments upon Termination or Change-in-Control
We provide higher levels of life insurance coverage to certain of our executives, including our NEOs, than is generally available to our other employees. In the event of a termination due to death on December 31, 2024, in addition to the amounts, if any, set forth in the table above, each of our NEOs (or their estates) would be entitled
Potential Payments upon Termination or Change-in-Control
| 56 | | 2025 PROXY STATEMENT |
Potential Payments upon Termination or Change-in-Control
under their respective life insurance policies to receive payments equal to four times their then-current base salaries, which base salary amounts are set forth above under “Compensation Discussion and Analysis—2024 Compensation Decisions—Base Compensation,” up to a maximum of $2 million.
Potential Payments upon Termination or Change-in-Control
| 2025 PROXY STATEMENT | | 57 |
Potential Payments upon Termination or Change-in-Control
| Director Compensation |
Potential Payments upon Termination or Change-in-Control
For 2024, Mr. Graziosi, who is an employee of the Company, received no additional compensation for serving on our Board. Mr. Graziosi’s compensation is reported in the Summary Compensation Table above. During 2024, we provided the following compensation to our non-employee members of the Board:
Potential Payments upon Termination or Change-in-Control
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | Total ($) | | Judy L. Altmaier | 111,500 | 154,925 | 266,425 | | D. Scott Barbour | 109,500 | 154,925 | 264,425 | | Philip J. Christman | 109,500 | 154,925 | 264,425 | | David C. Everitt | 103,000 | 154,925 | 257,925 | | Carolann I. Haznedar | 109,750 | 154,925 | 264,675 | | Richard P. Lavin | 138,250 | 154,925 | 293,175 | | Sasha Ostojic | 99,336 | 154,925 | 254,261 | | Gustave F. Perna | 108,736 | 154,925 | 263,661 | | Krishna Shivram | 119,500 | 154,925 | 274,425 |
Potential Payments upon Termination or Change-in-Control
| (1) Amounts included in this column represent the director’s annual retainer and committee service fees. The annual retainer may be paid in common stock or cash, at the director’s election. Both the annual retainer and committee service fees may be deferred under our Director Deferred Compensation Plan. The annual retainer and committee fees included in this column were paid as follows: |
Potential Payments upon Termination or Change-in-Control
| Name | Annual Retainer— Common Stock (#) | Annual Retainer— DSU (#) | Annual Retainer— Cash ($) | Committee and Other Fees—Cash ($) | Committee and Other Fees— DSUs (#) | | Ms. Altmaier | — | — | 90,000 | 21,500 | — | | Mr. Barbour | 551 | — | 45,000 | 19,500 | — | | Mr. Christman | 238 | — | 66,250 | 19,500 | — | | Mr. Everitt | — | — | 90,000 | 13,000 | — | | Ms. Haznedar | — | — | 90,000 | 19,750 | — | | Mr. Lavin | — | 1,105 | — | — | 588 | | Mr. Ostojic | 478 | — | 42,500 | 9,336 | — | | General Perna | — | — | 90,000 | 18,736 | — | | Mr. Shivram | — | | 90,000 | 29,500 | — |
Potential Payments upon Termination or Change-in-Control
| 58 | | 2025 PROXY STATEMENT |
Potential Payments upon Termination or Change-in-Control
| (2) Represents the grant date fair value of the annual equity award in accordance with ASC 718. The amounts are calculated by multiplying the number of shares underlying the award by the closing price for a share of our common stock as reported by the NYSE on the date of grant and include the director’s annual equity award received in RSUs: |
Potential Payments upon Termination or Change-in-Control
| Name | Annual Equity Award—RSUs (#) | Annual Equity Award—DSUs (#) | | Ms. Altmaier | — | 2,017 | | Mr. Barbour | 2,017 | — | | Mr. Christman | 2,017 | — | | Mr. Everitt | — | 2,017 | | Ms. Haznedar | — | 2,017 | | Mr. Lavin | — | 2,017 | | Mr. Ostojic | 2,017 | — | | General Perna | 2,017 | — | | Mr. Shivram | 2,017 | — |
Potential Payments upon Termination or Change-in-Control
| (3) As of December 31, 2024, our non-employee directors had the following number of RSUs and DSUs outstanding: |
Potential Payments upon Termination or Change-in-Control
| Name | RSUs (#) | DSUs (#) | | Ms. Altmaier | — | 20,541 | | Mr. Barbour | 2,032 | — | | Mr. Christman | 2,032 | — | | Mr. Everitt | — | 36,313 | | Ms. Haznedar | — | 21,441 | | Mr. Lavin | — | 34,717 | | Mr. Ostojic | 2,032 | — | | General Perna | 2,032 | — | | Mr. Shivram | 2,032 | — |
Potential Payments upon Termination or Change-in-Control
The number of RSUs and DSUs includes dividend equivalents earned on the unvested awards.
Director Compensation Policy
Director Compensation Policy Under our Eighth Amended and Restated Non-Employee Director Compensation Policy, or the Director Compensation Policy, each non-employee director receives:
Director Compensation Policy
| • | an annual retainer for: (i) Board service, (ii) service as the chair of our Audit, Compensation, Finance and Nominating and Corporate Governance Committees, and (iii) service as a member of our Audit, Compensation, Finance and Nominating and Corporate Governance Committees; and |
Director Compensation Policy
| • | an annual equity award. |
Director Compensation Policy
For their service as members of our Board, all non-employee directors received:
Director Compensation Policy
| • | An annual equity award with a grant date fair value of approximately $155,000 payable 100% in RSUs granted under the 2024 Plan (with the number of shares underlying the RSUs based on the closing price of our common stock on the NYSE on the date of grant). |
Director Compensation Policy
| • | An annual retainer of $95,000 payable quarterly in arrears, at the director’s election, either 100% in fully vested common stock granted under the 2024 Plan (valued based on the closing price of a share of our common stock on the NYSE on the date of grant), 100% in cash or 50% in fully vested common stock (valued as described above) and 50% in cash. |
Director Compensation Policy
| • | For service as a member of the following committees, each committee member received an annual cash retainer of: |
Director Compensation Policy
| ○ | $6,500 for service as a member of the Finance and Nominating and Corporate Governance Committees, |
Director Compensation Policy
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Director Compensation Policy
| ○ | $7,500 for service as a member of the Compensation Committee, and |
Director Compensation Policy
| ○ | $12,000 for service as a member of the Audit Committee. |
Director Compensation Policy
| • | For service as a chair of the following committees, each chair received an annual cash retainer of: |
Director Compensation Policy
| ○ | $15,000 for service as the chair of our Compensation, Finance and Nominating and Corporate Governance Committees, and |
Director Compensation Policy
| ○ | $24,000 for service as the chair of our Audit Committee. |
Director Compensation Policy
| • | The Lead Independent Director received a $30,000 annual cash retainer. |
Based on this information, for 2024 the ratio of the annual total compensation of Mr. Graziosi, our Chief
| Pay Versus Performance |
Based on this information, for 2024 the ratio of the annual total compensation of Mr. Graziosi, our Chief
| Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(2) | Average Summary Compensation Table Total for Non-PEO NEOs(3) | Average Compensation Actually Paid to Non-PEO NEOs(4) | Value of Initial Fixed $100 Investment Based On: | | Net Income (millions) | Adjusted EBITDA as a Percent of Net Sales(7) | | | | | | | Total Shareholder Return(5) | Peer Group Total Shareholder Return(6) | | | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | | 2024 | $12,332,822 | $40,314,314 | $2,623,620 | $6,488,723 | $244.08 | $139.30 | $731 | 36.1% | | 2023 | $10,328,625 | $18,801,457 | $2,312,882 | $3,355,925 | $129.84 | $147.08 | $673 | 36.5% | | 2022 | $9,201,698 | $11,986,411 | $2,058,559 | $2,319,966 | $91.27 | $119.58 | $531 | 34.7% | | 2021 | $8,528,568 | $5,085,371 | $2,103,967 | $1,548,849 | $78.11 | $145.20 | $442 | 35.1% | | 2020 | $1,317,057 | $(2,804,974) | $1,479,690 | $1,077,502 | $90.91 | $120.62 | $299 | 35.2% |
Based on this information, for 2024 the ratio of the annual total compensation of Mr. Graziosi, our Chief
| (2) The dollar amounts reported in column (c) represent the amount of “compensation actually paid” to Mr. Graziosi, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Graziosi during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Mr. Graziosi’s total compensation for each year to determine the compensation actually paid: |
Based on this information, for 2024 the ratio of the annual total compensation of Mr. Graziosi, our Chief
| (4) The dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to such NEOs as a group (excluding Mr. Graziosi), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to such NEOs as a group (excluding Mr. Graziosi) during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for such NEOs as a group (excluding Mr. Graziosi) for each year to determine the compensation actually paid, using the same methodology described above in Note 2: |
Compensation Actually Paid and Net income
Compensation Actually Paid and Net income The compensation actually paid to Mr. Graziosi and the average compensation actually paid to the Non-PEO NEOs was aligned with our Net income over the five-year period. Both the Net income and compensation actually paid increased over the five-year period. While we do not use Net income as a performance measure in our overall executive compensation program, the measure of Net income is correlated with the measure Adjusted EBITDA as a percent of net sales, which we do use when setting goals for the IComp program.
Compensation Actually Paid and Net income
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Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales We utilize Adjusted EBITDA as a percent of net sales when setting goals in the IComp program. The Adjusted EBITDA as a percent of net sales performance metric for the IComp program is weighted at 30%. The compensation actually paid to Mr. Graziosi and the average compensation actually paid to the Non-PEO NEOs was not aligned with our Adjusted EBITDA as a percent of net sales in 2024 like it was in 2023. There was a large jump in compensation actually paid to our NEOs, but a slight drop in Adjusted EBITDA as a percent of net sales in 2024. That was because Adjusted EBITDA as a percent of net sales only influences the IComp program and the increase in compensation actually paid to our NEOs in 2024 was driven by our stock price performance and the value of our NEOs' equity awards. The compensation actually paid to Mr. Graziosi and the average compensation actually paid to the Non-PEO NEOs appears to be misaligned with our Adjusted EBITDA as a percent of net sales for 2020, 2021 and 2022; however, achievement against the annual target for the IComp program increased each year. The target Adjusted EBITDA as a percent of net sales was decreased from 36.6% in 2020, to 35.1% in 2021 and 34.02% in 2022 in anticipation of business changes during those years. We experienced increasing costs that impacted our margins during that timeframe, including labor, commodities and freight costs due to the COVID-19 pandemic. Additionally, engineering research and development and capital expenditures increased as we invested in programs to enhance our conventional portfolio and develop a portfolio of electric propulsion solutions, which impacted our margins but positioned us for longer term revenue growth. For further information regarding the IComp program, see “Executive Compensation – Compensation Discussion and Analysis – 2024 Compensation Decisions – Annual Performance-Based Compensation (IComp)” above.
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
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Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| Equity Compensation Plan Information |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
The following table summarizes the information regarding equity awards outstanding and available for future grants as of December 31, 2024.
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | | | (a) | (b) | (c) | | Equity compensation plans approved by security holders(1) | 2,367,369(2) | $52.45(3) | 3,814,989(4) | | Equity compensation plans not approved by security holders | — | — | — | | Total | 2,367,369 | $52.45 | 3,814,989 |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| (1) Consists of the 2024 Plan, the 2015 Plan and the 2011 Equity Incentive Award Plan, or the 2011 Plan. |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| (2) Includes 1,023,780 shares subject to RSUs and performance units (at the maximum level of performance) and 16,173 shares issuable upon vesting of outstanding dividend equivalents earned on unvested RSUs. |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| (3) Represents the weighted average exercise price of outstanding stock options. Does not take into consideration the shares issuable upon vesting of outstanding RSUs and performance units, which have no exercise price. |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| (4) Represents shares available for issuance under the 2024 Plan. The 2024 Plan is an amendment and restatement of the 2015 Plan. No shares remain available for future issuance under the 2011 Plan. However, to the extent outstanding stock options granted prior to May 8, 2024 under the 2015 Plan or the 2011 Plan are forfeited or lapse unexercised, the shares of common stock subject to such stock options will be available for future issuance under the 2024 Plan. |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
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Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| Stockholder Proposals at 2026 Annual Meeting |
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
Stockholder proposals to be considered for inclusion in the proxy statement and form of proxy card relating to the 2026 annual meeting of stockholders must be received no later than November 26, 2025. In addition, all proposals will need to comply with Rule 14a-8 of the Exchange Act, which lists the requirements for the inclusion of stockholder proposals in company-sponsored proxy materials. Stockholder proposals must be delivered to our Secretary by mail at One Allison Way, Indianapolis, Indiana 46222. Notice of any director nomination, or any other proposal that a stockholder intends to present at the 2026 annual meeting of stockholders, but does not intend to have included in the proxy statement and form of proxy relating to the 2026 annual meeting of stockholders, must be delivered to our Secretary by mail at One Allison Way, Indianapolis, Indiana 46222 not earlier than January 7, 2026 and not later than 5:00 p.m. Eastern Time on February 6, 2026. The notice also must set forth the information required by our Bylaws with respect to each director nomination or other proposal that a stockholder intends to present at the 2026 annual meeting of stockholders. In addition, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than our nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 9, 2026. In addition, our Bylaws provide a proxy access right permitting certain of our stockholders who have beneficially owned 3% or more of our outstanding common stock continuously for at least 3 years to submit nominations via the Company’s proxy materials for up to 25% of the directors then serving. Notice of proxy access director nominations for the 2026 annual meeting of stockholders must be delivered to our Secretary by mail at One Allison Way, Indianapolis, Indiana 46222 not earlier than October 27, 2025 and not later than November 26, 2025. In addition, the notice must set forth the information required by our Bylaws with respect to each proxy access director nomination that a stockholder intends to present at the 2026 annual meeting of stockholders. A copy of the Bylaw provisions may be obtained by contacting our Secretary.
Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
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Compensation Actually Paid and Adjusted EBITDA as a Percent of Net Sales
| Questions and Answers about the Annual Meeting and Voting |

DEF 14A of Allison Transmission Holdings Inc

Majority Vote Standard for Election of Directors

Nominees for Director

Nominees for Director

Nominees for Director

Nominees for Director

Nominees for Director

Nominees for Director

Nominees for Director

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Nominees for Director

Nominees for Director

Corporate Governance Framework

Corporate Governance Framework

Corporate Governance Framework

Corporate Governance Framework

Corporate Governance Framework

Corporate Governance Framework

Compensation Overview

Compensation Overview

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

2024 Compensation Decisions

Employment and Severance Arrangements

Tax Considerations

Equity Award Timing Policies and Practices

Summary Compensation Table

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Summary Compensation Table

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Grants of Plan-Based Awards for 2024

Outstanding Equity Awards at December 31, 2024

Outstanding Equity Awards at December 31, 2024

Outstanding Equity Awards at December 31, 2024