DEF 14A of Transcat Inc, Jul 23, 2024

DEF 14A of Transcat Inc

Filed Jul 23, 2024 · FY20240001206774-24-000686

Open on EDGAR

  1. Directors and Director Nominees

    Directors and Director Nominees

  2. Directors and Director Nominees

    | Name | Age | Recent Professional Experience | Committees | | Craig D. Cairns*⧫ | 59 | President of Howe & Rusling, Inc. | CC** | | Dawn DePerrior* | 66 | Retired Managing Director in EY’s Healthcare Technology Consulting Practice | CC | | Oksana S. Dominach*⧫ | 60 | Senior Vice President, Beer Finance of Constellation Brands, Inc. | AC**, CC, EC | | Christopher P. Gillette* | 63 | Lean Leader Sales & Marketing of GE Aviation | — | | Charles P. Hadeed* | 74 | Former Chairman, President and Chief Executive Officer of the Company | AC, EC |

  3. Directors and Director Nominees

    | Name | Age | Recent Professional Experience | Committees | | Gary J. Haseley* | 62 | Chairman of Board of the Company; Retired Senior Vice President and General Manager of Kaman Automation, Control & Energy | EC** | | Mbago M. Kaniki* | 46 | Chief Executive Officer of Adansonia Management LLC | NESGC**, CC | | Robert L. Mecca* | 52 | Senior Vice President of Finance at Gilead Sciences | AC | | Cynthia Langston* | 63 | Senior Vice President and Chief Information Officer at Excellus BlueCross BlueShield | NESGC | | Lee D. Rudow⧫ | 60 | President and Chief Executive Officer of the Company | EC |

  4. Directors and Director Nominees

    | ⧫ | — Director Nominee | AC | — Audit Committee | | * | — Independent | CC | — Compensation Committee | | ** | — Chair | NESGC | — Nominating, Environmental, Social and Governance Committee | | | | EC | — Executive Committee |

  5. Nominees Proposed for Election as Directors

    Nominees Proposed for Election as Directors

  6. Nominees Proposed for Election as Directors

    | Craig D. Cairns | | | Age: 59 Director since: 2021 | Board Committee: Compensation (Chair) | | Mr. Cairns has served as the President since May 2003 and is the majority owner of Howe & Rusling, Inc., a wealth management services company. Mr. Cairns has more than 25 years of investment experience. Mr. Cairns currently serves as the Vice Chairman of the board of trustees of McQuaid Jesuit High School and is also the Chair of the Investment Committee for the Veterans’ Outreach Center. | | | Experience and Qualifications | | | Mr. Cairns brings to the Board extensive leadership experience and considerable experience with client relations, capital allocation, sales and marketing. His experience with strategic planning and execution provides us with valuable knowledge as we continue to implement our growth strategy. | |

  7. Nominees Proposed for Election as Directors

    | Oksana S. Dominach | | | Age: 60 Director since: 2019 | Board Committees: Audit (Chair) Compensation Executive | | Ms. Dominach is Senior Vice President, Beer Finance of Constellation Brands, Inc. (NYSE: STZ), a leading international producer and marketer of beer, wine and spirits. She was elected Vice President in 2004 and promoted to the Senior Vice President role in February 2016, and elected Assistant Treasurer in 2004 and promoted to Treasurer in June 2015. Previously, she served as Finance Director from 2003 to 2004. Ms. Dominach currently serves as treasurer and director of the not-for-profit Board of Constellation – Marvin Sands Performing Arts Center; a director of the Directors Advisory Council of the Rochester Division of Manufacturers and Traders Trust Company; a director of various Constellation subsidiaries including Ruffino S.r.l., Tenute Ruffino S.r.l. and Poderi Ducali Ruffino S.r.l.; and a director of North Coast Holdings, Inc. and Lewis Tree Service, Inc. | | | Experience and Qualifications | | | Ms. Dominach brings to the Board more than 35 years of experience and expertise in financial strategy and risk management, as well as over ten years of experience participating on public and not-for-profit boards. Her capital structure management, risk management and corporate compliance expertise provide us with valuable insight and acumen as we continue to advance our growth strategy. | |

  8. Nominees Proposed for Election as Directors

    | Lee D. Rudow | | | Age: 60 Director since: 2015 | Board Committee: Executive | | Mr. Rudow joined us in November 2011 as our Chief Operating Officer and was appointed President in September 2012. He was appointed Chief Executive Officer in July 2013. From 2008 until 2011, Mr. Rudow served as Vice President in various capacities for SIMCO Electronics, Inc., an independent provider of global calibration, repair and software solutions. Prior to that, from 2006 to 2008, he was President and Chief Executive Officer of Davis Calibration, Inc., served as President and Chief Executive Officer of its related business and predecessor, Davis Inotek Corp. from 1996 to 2006, and served as President of Davis Instruments Corp. from 1986 to 1996. | | | Experience and Qualifications | | | Mr. Rudow brings more than 35 years of experience in both of our industry segments. He has a strong understanding of the execution needed for our current business strategy and has served in sales, sales management and operational positions at Transcat and our competitors. Mr. Rudow has worked at startups, private equity-funded and large industrial companies in our industry space. His skill set is uniquely suited for our organic and acquisitive strategic initiatives. Our customers, suppliers, employees and Board recognize his experience as providing a broad set of skills in his roles as our Chief Executive Officer and Board member. | |

  9. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

  10. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Dawn DePerrior | | | Age: 66 Director since: 2024 Term expires: 2025 | Board Committee: Compensation | | Ms. DePerrior retired as a managing director in EY’s healthcare technology consulting practice in June 2022. A digital leader during her 40-year career, Ms. DePerrior has command of all aspects of Information Technology (IT) including strategy, business transformation, cyber security, digitization, data, analytics, innovation, mergers and acquisition integration, and finance. Her business technology career is uniquely defined by its breadth and depth of experience, including as a consultant and internal senior leader in manufacturing, distribution, consumer product goods, healthcare, and finance, enabling her to bring creative ideas, think “out of the box”, and inspire large teams to solve strategic business problems. Prior to EY, Ms. DePerrior led business information technology transformation teams at Constellation Brands and the University of Rochester Medical Center. Ms. DePerrior was previously the board chair for the Villa of Hope, a Rochester based family services organization, and currently serves on the executive committee. She is also a member of the board of directors for North Coast Holdings and Evans Bank. | | | Experience and Qualifications | | | Ms. DePerrior’s experience in leading business technology strategy and subsequent execution of complex business transformation programs powered by innovative technology uniquely positions her to support Transcat’s strategic plan and growth. Her broad and deep leadership experience in business technology strategy, cyber, risk, data and analytics will add value as we continue the advancement of our technology strategy. | |

  11. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Christopher P. Gillette | | Age: 63 Director since: 2023 Term expires: 2026 | | Mr. Gillette has served as Lean Leader Sales & Marketing of GE Aerospace, a world-leading provider of jet and turboprop engines, components and integrated systems for commercial, military, business and general aviation aircraft, since January 2022. He served as VP Commercial Excellence at GE Digital, a software and Industrial Internet of Things service provider, from July 2020 to January 2022. From April 2015 to July 2020, Mr. Gillette held various senior positions at Philips, a focused leader in health technology. | | Experience and Qualifications | | Mr. Gillette brings to the Board extensive leadership and calibration industry experience, and considerable experience with client relations, sales and marketing. This experience, along with his strategic planning and market development experience, provide the Board with valuable knowledge as we continue to implement our growth strategy. |

  12. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Charles P. Hadeed | | | Age: 74 Director since: 2007 Term expires: 2025 | Board Committees: Audit Executive | | Mr. Hadeed served as our Chairman of the Board from June 2014 until September 2020, as our Executive Chairman from July 2013 until June 2014, as our Chief Executive Officer from April 2007 to July 2013, and as our President from May 2006 to September 2012. He also served as our Chief Operating Officer from October 2004 to November 2011. Mr. Hadeed joined us in April 2002 as our Vice President of Finance and Chief Financial Officer, a role he served in until May 2006. Prior to joining us, Mr. Hadeed most recently served as Vice President-Healthcare Ventures Group with Henry Schein Inc. Prior to that, he served as Group Vice President-Operations at Del Laboratories Inc. and in various executive positions during his 20-year career at Bausch & Lomb Incorporated. Mr. Hadeed was a director of IEC Electronics Corp., formerly a public company, from 2015 until it merged with Creation Technologies Inc. in 2021. He also has served on the board of directors of several not-for-profit organizations in the greater Rochester, New York area. | | | Experience and Qualifications | | | As our former Chairman, Executive Chairman, Chief Executive Officer, President, Chief Operating Officer, and Vice President of Finance and Chief Financial Officer, Mr. Hadeed provides the Board with invaluable institutional knowledge of the operations of our company, its markets and its customers. When Mr. Hadeed joined us in April 2002, our company was facing a number of critical challenges. His financial and management skills contributed to the resolution of those challenges, as well as the financial turnaround and growth the Company has experienced during his tenure with us. Mr. Hadeed continues to provide leadership for our sustained growth, profitability and financial stability. | |

  13. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Gary J. Haseley | | | Age: 62 Director since: 2015 Term expires: 2026 | Board Committee: Executive (Chair) | | Mr. Haseley has served as the Chairman of our Board since September 2020. He served as the Senior Vice President and General Manager of Kaman Automation, Control & Energy, a division of Kaman Corporation (NYSE: KAMN), a manufacturer in the aerospace industry and the third largest distributor in the power transmission/motion control market, until his retirement in November 2016. Prior to joining Kaman, from January 2001 to August 2012, Mr. Haseley served as President and Chief Executive Officer of Zeller Corporation, a distributor of electrical and automation components and solutions, which Kaman acquired in 2012. From 1995 until 2001, Mr. Haseley served as Zeller’s Vice President of Sales. Prior to joining Zeller, Mr. Haseley held various engineering and sales positions. From May 2018 until December 2019, Mr. Haseley served on the board of directors of Jerash Holdings (US), Inc. (Nasdaq: JRSH). Mr. Haseley has also served on the board of several other for-profit and not-for-profit entities. | | | Experience and Qualifications | | | Mr. Haseley brings extensive knowledge in the distribution and services markets to our Board. His role as Chief Executive Officer of Zeller Corporation and subsequent operational and sales roles at Kaman provide the Board with valuable insights into the leveraging of two market segments similar in synergies to our industry segments. | |

  14. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Mbago M. Kaniki | | | Age: 46 Director since: 2021 Term expires: 2026 | Board Committees: Nominating and ESG (Chair) Compensation | | Mr. Kaniki has served as Chief Executive Officer of Adansonia Management LLC, an investment firm, since March 2013. He was Chief Executive Officer of Alva Charge LLC, an electric vehicle charging company, from May 2016 to April 2021. Mr. Kaniki worked for other investment firms from 2001 to 2013. He has served on the board of directors of for-profit and not-for-profit entities. | | | Experience and Qualifications | | | Mr. Kaniki has had valuable experience with numerous complex transactions, including debt and equity financings, and mergers and acquisitions. His extensive leadership experience and expertise in driving business growth and transformation through effective strategic planning and execution are valuable to the Board as the Company continues to implement its growth strategy. | |

  15. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Cynthia Langston | | | Age: 63 Director Since: 2022 Term expires: 2025 | Board Committee: Nominating and ESG | | Ms. Langston joined Excellus BlueCross BlueShield in 2014 and has served as its Senior Vice President and Chief Information Officer since July 2021, having previously served in advancing positions including most recently as Senior Vice President, Chief Analytics and Data Officer from July 2017 to July 2021 and Vice President, Enterprise Project Delivery Organization from 2014 to July 2017. Ms. Langston is also Chair of the board of directors of the YWCA of Rochester & Monroe County. | | | Experience and Qualifications | | | Ms. Langston brings to the Board extensive experience in enterprise strategy, information technology, cybersecurity and analytics across several major industries, as well as globally. Her qualifications for election to the Board include her extensive operational, technology and risk management expertise. Ms. Langston also brings deep management and leadership experience to the Board, having held several senior leadership positions during her career. | |

  16. Directors Whose Terms Do Not Expire at the 2024 Annual Meeting

    | Robert L. Mecca | | | Age: 52 Director Since: 2024 Term expires: 2025 | Board Committee: Audit | | Mr. Mecca is the Senior Vice President of Finance at Gilead Sciences, Inc. (Nasdaq: GILD), a leader in the life sciences industry. Mr. Mecca brings more than two decades of US and international life science industry experience in both biotech and large pharma. From July 2021 to July 2023, Mr. Mecca served as Senior Vice President of Finance at BeiGene USA (BeiGene), an oncology biotechnology company. Prior to his time at BeiGene, Mr. Mecca was Senior Vice President of Commercialization Finance at Bristol Myers Squibb, a global pharmaceutical company, where he held a series of expanding financial executive leadership positions with responsibilities for global manufacturing, international commercialization, R&D and business development. Mr. Mecca started his career as a technology & risk management consultant at Arthur Andersen LLP, an accounting firm. Mr. Mecca earned a master of business administration with a concentration in finance from The Wharton School of the University of Pennsylvania and a bachelor of administration in accounting from Loyola University in Maryland. Mr. Mecca serves on the board of directors of the Emmanuel Cancer Foundation. | | | Experience and Qualifications | | | Mr. Mecca brings to the board more than 25 years of financial experience in the life sciences industry with expertise in financial management, strategy development, business expansion and M&A. His extensive experience leading organizations through stages of growth and transformation will be valuable to the board as we optimize our operations and continue our growth. | |

  17. Board Diversity Matrix

    Board Diversity Matrix The matrix below provides certain highlights of the composition of our Board as of July 23, 2024. Each of the categories listed in the matrix below has the meaning as it is used in Nasdaq Rule 5605(f).

  18. Board Diversity Matrix

    | Board Diversity Matrix (as of July 23, 2024) | | | | Total Number of Directors | 10 | | | | Female | Male | | Part I: Gender Identity | | | | Directors | 3 | 7 | | Part II: Demographic Background | | | | African American or Black | 1 | 1 | | White | 2 | 6 |

  19. Board Diversity Matrix

    EXECUTIVE OFFICERS AND SENIOR MANAGEMENT We are currently served by our executive officers, Messrs. Rudow, Barbato, and West and Ms. Conroy, together with four additional members of the senior management team. Thomas Barbato, age 54, is our Chief Financial Officer and Treasurer having served us in this position since August 2022. Mr. Barbato previously served as our Senior Vice President, Finance since January 2022. Mr. Barbato served as the Chief Financial Officer of IEC Electronics Corp., a provider of manufacturing services for advanced technology companies and formerly a public company until it merged with Creation Technologies Inc. in October 2021, from September 2018 to December 2021. Mr. Barbato held various positions with Xerox Corporation from 1995 until 2018, most recently as Vice President of Finance, North American Operations, Pricing and Contracting Center of Excellence from January 2017 to September 2018. Marcy Bosley, age 46, has served as our Vice President of Sales since July 2020, having previously served as a Senior Director of Sales for us from February 2019 until such time. Ms. Bosley has 19 years of experience in the calibration industry. Prior to joining us, Ms. Bosley served in various roles for SIMCO Electronics, a leading provider of calibration and software services for test and measurement instruments used in technology organizations, from 2009 until February 2019, most recently as Vice President, Sales from September 2018 to February 2019, and head of North American area sales from July 2016 to September 2018. Theresa A. Conroy, age 60, is our Senior Vice President of Human Resources and has served us in this position since May 2023, after joining us in January 2022 as Vice President of Human Resources. Previously, Ms. Conroy was a partner at Harter Secrest & Emery LLP from 2003 until December 2021 where her practice focused on labor, employment, human resources and higher education law. Scott D. Deverell, age 59, joined us in February 2016 and is our Corporate Controller and Principal Accounting Officer. Prior to joining us, Mr. Deverell served as Vice President of Finance and Administration for Sydor Instruments, a comprehensive diagnostics solution provider, which he joined in April 2015. From 2009 to 2014, Mr. Deverell served as Division President for Stewart Title Insurance Company, a title insurance underwriter. Randy Ford, age 49, has served as our Vice President of Operations since April 2023, having previously served as our Senior Director of Metrology and Operations from August 2021 until such time. Prior to joining us, Mr. Ford served in various roles for SIMCO Electronics, a leading provider of calibration and software services for test and measurement instruments, from 2007 to August 2021. Most recently he served as Director of Quality, Operational Excellence and IT/IS from March 2016 until August 2021, and Southwest Area Director from February 2015 to March 2016. Mr. Ford has over 29 years of experience in the calibration industry. Lee D. Rudow, age 60, is our President and Chief Executive Officer. Additional information about Mr. Rudow can be found under “Proposal One: Election of Directors.” D. Scott Smith, age 48, has served as our Vice President of Operations since April 2023. Mr. Smith joined us in 2005 and most recently served in the position of Senior Director of Acquisitions and Integrations since March 2021. From January 2005 through September 2017, he held various finance positions including Senior Director of FP&A and from October 2017 to February 2021 was our Senior Director of Operations Performance and Integrations. Michael W. West, age 53, has served as our Chief Operating Officer since April 2024. He most recently served as our Senior Vice President of Business Operations since April 2023 and prior to that as our Vice President of Distribution and Marketing since November 2014. From 1995 to 2014, Mr. West was a principal owner of QuestCom Inc., a marketing and advertising company, and served most recently as a marketing consultant to various direct mail, web and catalog clients. Mr. West worked with our marketing team, as one of his clients, for 13 years. COMPENSATION DISCUSSION AND ANALYSIS Named Executive Officers Our Compensation Discussion and Analysis (the “CD&A”) describes the material elements of our executive compensation program and decisions in fiscal 2024 for our named executive officers (the “NEOs”), who for fiscal 2024 were:

  20. Board Diversity Matrix

    | • | Lee D. Rudow, President and Chief Executive Officer; | | • | Thomas Barbato, Chief Financial Officer and Treasurer; | | • | Theresa A. Conroy, Senior Vice President, Human Resources; | | • | Mark A. Doheny, Former Chief Operating Officer; and | | • | James M. Jenkins, Former Chief Legal Officer, Corporate Development Officer and Corporate Secretary. |

  21. Board Diversity Matrix

    Fiscal 2024 Business Results

  22. Board Diversity Matrix

    | • | Total revenue was $259.5 million in fiscal 2024, an increase of $28.9 million or 12.5% from fiscal 2023. | | • | Net income was $13.6 million in fiscal 2024, a $3.0 million increase from fiscal 2023 and net income per diluted share was $1.63, up from $1.40 in fiscal 2023. | | • | Adjusted EBITDA* was $38.6 million in fiscal 2024, which represented an increase of $8.2 million or 26.9% from fiscal 2023. | | • | Service segment revenue was $169.5 million and Service gross profit was $57.3 million in fiscal 2024, an increase of 17.0% and 22.8%, respectively, from the prior fiscal year. |

  23. Board Diversity Matrix

    * Refer to Appendix A of this proxy statement for our definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to the most directly comparable U.S. GAAP measure. Determining NEO Compensation Philosophy and Objectives Our compensation program is designed to attract, motivate and retain a highly-qualified and effective executive management team. We believe that the most effective executive compensation program is one that is designed to reward the achievement of specific annual, long-term and strategic company goals, which align the interests of each of our executive management team with those of our shareholders. The objectives of the compensation program for our NEOs are to motivate them to achieve our business objectives, to reward them for achievement, to foster teamwork, to support our core values and to contribute to our long-term success. Our compensation policies for our NEOs are designed to link pay to both performance, taking into account the level of difficulty associated with each executive’s responsibilities, and shareholder returns over the long term. We believe the compensation provided to our NEOs is competitive with the compensation paid to executives with similar responsibilities in comparable companies, and the Compensation Committee is focused on better aligning our NEOs’ compensation with our peer group, as described further below. Role of the Compensation Committee The Compensation Committee is responsible for establishing, implementing and monitoring adherence to our compensation philosophy and objectives. The Compensation Committee reviews, recommends and approves salaries and other compensation of our Chief Executive Officer and other executive officers, administers our cash and equity incentive plans (including reviewing and approving awards to executive officers), approves all benefit plans and programs including bonus and retirement plans, policies and programs, and makes recommendations to the Board with respect to the compensation of directors. The Compensation Committee’s policy is to provide a competitive total compensation package to our NEOs. Generally, the types of compensation and benefits provided to our NEOs are similar to those provided to our other executive management team members. The Compensation Committee is also responsible for reviewing the CD&A and for preparing the Compensation Committee Report included in this proxy statement. Our Compensation Committee and our Board, as applicable, do not assign relative weights or rankings to factors, and do not consider any single factor as determinative in the compensation of our NEOs. Rather, our Compensation Committee and our Board, as applicable, rely on their own knowledge and judgment in assessing performance and making compensation decisions. Role of Management Upon completion of the fiscal year, our Chief Executive Officer and our Chief Financial Officer review our performance against each pre-established corporate financial objective, comparing the fiscal year results to the pre-determined threshold, target and maximum levels for each objective, and an overall percentage for the corporate financial objectives is calculated. The results of our financial performance are then reviewed and approved by the Compensation Committee and the Board. With respect to an individual’s performance portion of the annual performance-based cash incentive award, our Chief Executive Officer evaluates each officer’s accomplishments (other than the Chief Executive Officer’s himself) relative to their individual objectives and calculates a performance rating based on the performance-based cash incentive plan previously approved by the Compensation Committee. Individual performance goals for our NEOs are carefully designed to create alignment between our short and long-term objectives and strategies, and the individual’s performance. Role of Compensation Consultant Under its charter, our Compensation Committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, independent legal counsel or other advisor. In fiscal 2024, the Compensation Committee engaged Frederic W. Cook & Company, Inc. (“FW Cook”), as its independent compensation consultant, to provide advice regarding peer group companies and to assist with the determination of NEO compensation. The Committee assessed the independence of FW Cook pursuant to SEC rules and concluded their work did not raise any conflicts of interest. Competitive Market Data The Compensation Committee reviews market data on executive pay levels and program design to assist in determining appropriate compensation for the NEOs. For fiscal 2024, the Compensation Committee did not benchmark compensation to a particular percentile of market data, but rather used market data as context when establishing compensation. In fiscal 2023, we engaged FW Cook to provide a competitive frame of reference for compensation decisions, which included the recommendation of a new peer group. Our peer group consists of selected companies drawn from a broad group of public companies from similar industries and comparable size. FW Cook noted (as our Compensation Committee has noted in prior years) that we have no pure peers. We used the peer group to inform the Compensation Committee’s determinations for fiscal 2024 compensation. Our peer group consists of the following public companies:

  24. Board Diversity Matrix

    | AeroVironment, Inc. | Argan, Inc. | CIRCOR International, Inc. | | Cryoport, Inc. | Cutera, Inc. | Ducommun Incorporated | | Enzo Biochem, Inc. | Harvard Bioscience, Inc. | InfuSystem Holdings, Inc. | | Inogen, Inc. | Kaman Corporation | LeMaitre Vascular, Inc. | | Ligand Pharmaceuticals Incorporated | Mesa Laboratories, Inc. | Powell Industries, Inc. | | Standex International Corporation | Surmodics, Inc. | Twin Disc, Incorporated | | | Willis Lease Finance Corporation | |

  25. Board Diversity Matrix

    The Compensation Committee determined in 2023 that market data warranted certain out of step increases for our Chief Executive Officer and NEOs during fiscal 2023 and fiscal 2024. After consulting with FW Cook, the Compensation Committee increased base compensation, bonus percentages, and long-term equity for each NEO that had been serving as an executive officer for the Company for longer than one year as of fiscal 2023. Over fiscal 2023 and 2024, the Compensation Committee awarded certain out of step time-based and performance-based equity as a means to better align our NEOs’ compensation with our peer group. Future realignment of compensation with our peer group may continue (if warranted) in fiscal 2025. Say-on-Pay Our shareholders will have an opportunity to cast an advisory vote on the compensation of our NEOs, commonly referred to as the “say on pay” vote, at the Annual Meeting. At our 2023 annual meeting of shareholders, we held an advisory vote on the compensation of our NEOs which resulted in 98% of the votes cast approving our compensation program for our NEOs. We evaluated the results of this vote as part of our overall assessment of our compensation program for our NEOs. Based on this overall assessment and the support expressed by our shareholders, we did not make any related material changes to our compensation program for our NEOs other than granting the one-time stock unit awards described below. At our 2019 annual meeting of shareholders, we recommended, and our shareholders approved, an annual frequency for the say-on-pay vote. After considering that recommendation, the Board determined that the say-on-pay vote will be held annually until the next required vote on the frequency of the say-on-pay vote to be held at our 2025 annual meeting of shareholders. Risk and Compensation Policies In considering the risks to us and our business that may be implied by our compensation plans and programs, our Compensation Committee considers the design, operation and mix of the plans and programs at all levels. Our compensation program is designed to mitigate the potential to reward excessive risk-taking that may produce short-term results that appear in isolation to be favorable, but that may undermine the successful execution of our long-term business strategy and erode shareholder value. The Compensation Committee has reviewed our compensation policies as generally applicable to our employees and believes that our policies do not encourage excessive and unnecessary risk-taking, and that the level of risk that they do encourage is not reasonably likely to have a material adverse effect on us. Clawback Policy We have adopted a Policy on Recoupment of Incentive Compensation (the “clawback policy”) which allows us to (i) recover incentive compensation from our executive officers if we are required to prepare a restatement of our financial statements due to material noncompliance with any financial reporting requirement under federal securities law, and (ii) recover incentive compensation provided to our current and former employees if they engage in detrimental conduct (in both cases, as defined in the clawback policy). We believe the clawback policy will maintain and enhance a culture that is focused on integrity and accountability, and that seeks to discourage conduct detrimental to our long-term growth. Anti-Hedging Policy We have an anti-hedging policy that prohibits directors, officers and employees from engaging in transactions that hedge or offset any decrease in the market value of equity securities granted as compensation. Tax Considerations Tax rules generally limit the deductibility of compensation paid to each of our NEOs to $1 million per year. The Compensation Committee retains the discretion to pay compensation that may not be tax deductible. Stock Ownership Objectives To more closely align the efforts of our NEOs with the interests of our shareholders, we set a minimum stock ownership objective for our NEOs. This objective encourages our NEOs to work towards acquiring and maintaining specific levels of equity ownership in our common stock. Under these objectives, our NEOs are expected to be in compliance with their respective ownership objectives within five years of becoming an NEO. The Compensation Committee and the Chief Executive Officer monitor the progress toward achievement of stock ownership objectives and, if warranted, can make reductions in long-term compensation awards as deemed appropriate. Mr. Rudow’s stock ownership objective is 2.5 times his base salary rate. The stock ownership objective for each of Ms. Conroy and Messrs. Barbato, Doheny and Jenkins is 1.5 times their base salary rate. Unvested restricted stock units count towards achieving this objective. At the end of fiscal 2024, Messrs. Rudow, Barbato, Doheny and Jenkins had each achieved their respective stock ownership objectives. Ms. Conroy is expected to achieve the stock ownership objective within five years of becoming an NEO.

  26. Elements of Executive Compensation

    In addition to the elements described on the table above, stock options may also be awarded to our NEOs in unique circumstances. A significant percentage of total compensation for our NEOs is placed at risk through annual and long-term incentives. There are established guidelines and targets regarding the allocation between annual (short-term) and long-term incentive compensation which is contingent and variable, based on Company results and individual performance. Pay Mix Our annual executive compensation program includes fixed components (base salary, benefits and perquisites) and variable components (annual performance-based cash incentive compensation and long-term equity incentive awards), with the heaviest weight generally placed on the variable, or “at risk,” components. For fiscal 2024, a majority of our Chief Executive Officer’s and our other NEOs’ target annual compensation was weighted toward at-risk compensation, as shown by the following graphs. Base Salary The Compensation Committee reviews base salaries for each of our NEOs at least annually. Base salary rate increases are made as necessary based on performance, scope of responsibilities and market information. During fiscal 2024, the Compensation Committee approved an increase in the base salary rate for each of our NEOs to better align with peer pay levels.

  27. Elements of Executive Compensation

    Company performance against the objectives results in a corporate payout factor used to establish the aggregate pool available for incentive awards. Individual awards were determined by using a multiplier to adjust annual incentive payouts for achievement of individual performance objectives (for NEOs other than our Chief Executive Officer) and subjecting such adjustments to the aggregate incentive pool, subject to a cap on individual awards. In addition to the performance goals, the annual performance-based cash incentive plan also provides guidelines for the calculation of annual incentive-based compensation, subject to Compensation Committee oversight and modification. The Compensation Committee established a threshold, target and maximum objective for each financial performance metric, with the corresponding corporate payout factor, as follows:

  28. Elements of Executive Compensation

    | Achievement | Percent of Annual Operating Plan | Corporate Payout Factor | | Maximum | 115% | 200% | | Target | 100% | 100% | | Threshold | 90% | 33% |

  29. Elements of Executive Compensation

    Performance against each financial performance metric is measured separately. If actual results fall below the threshold objective, the corporate payout factor will be 0%. If actual results fall in between the designated levels of achievement, the corporate payout factor will be interpolated. Generally, if actual results exceed the maximum objective, the corporate payout factor will be limited to 200% of target. NEOs with individual performance objectives must achieve at least a minimum performance level (a rating of 1 on a scale of 0 to 5) against such individual performance objectives to be eligible for any portion of the performance-based cash incentive award. For fiscal 2024, the corporate objectives, relative weights, and levels of performance achieved were as follows:

  30. Elements of Executive Compensation

    | Name | Fiscal 2024 Performance-Based Cash Incentive Award | | Lee D. Rudow | $652,700 | | Thomas Barbato | $207,691 | | Theresa A. Conroy | $115,933 | | Mark A. Doheny | $124,939 | | James M. Jenkins | $166,008 |

  31. Elements of Executive Compensation

    Long-Term Equity Incentive Awards We grant long-term equity incentive awards in the form of time-based restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) as a component of executive compensation to reinforce our NEOs’ long-term commitment to our success and, with respect to the PSUs, to align with shareholder interests. Our Compensation Committee sets target equity award levels as a percentage of annualized base salary based on our NEOs’ positions within the Company. Long-term performance-based incentive compensation is targeted to a specific dollar award, which is reviewed and approved annually by the Compensation Committee. The target equity award opportunity for fiscal 2024 as a percentage of annualized base salary for each of our NEOs and the long-term equity incentive compensation award opportunities to our NEOs is set forth in the following table. In addition, the Compensation Committee approved one-time stock unit awards to our NEOs as set forth in the following table. The one-time stock unit awards were granted based on the Compensation Committee’s review of our peer group and to better align the total compensation of our NEOs with market practice in our peer group.

  32. Elements of Executive Compensation

    | Fiscal 2024 | Equity Target | Long-Term Equity Award Opportunities | | | | Name | Percentage of Base Salary | PSUs (1) | RSUs (2) | One-Time Stock Unit Awards(3) | | Lee D. Rudow | 110% | 3,784 | 3,785 | 5,000 | | Thomas Barbato | 65% | 1,186 | 1,186 | 2,500 | | Theresa A. Conroy | 40% | 524 | 524 | 1,500 | | Mark A. Doheny | 65% | 1,131 | 1,132 | 2,500 | | James M. Jenkins | 60% | 984 | 985 | 2,500 |

  33. Elements of Executive Compensation

    | (1) The shares underlying the PSUs will vest after three years subject to our achieving specific cumulative Adjusted EBITDA objectives over the eligible three-year period ending in the fiscal year ending March 28, 2026. | | (2) The shares underlying the RSUs will vest on March 28, 2026, subject to the terms of the award and continued employment through the vesting date. | | (3) The shares underlying the one-time RSUs for Messrs. Rudow, Barbato, and Jenkins and Ms. Conroy will vest on March 28, 2026. The shares underlying the one-time PSUs for Mr. Doheny will vest after three years subject to achieving performance objectives tied to improving service segment gross margin over the eligible three-year period ending in the fiscal year ending March 28, 2026. |

  34. Elements of Executive Compensation

    Upon vesting, the holders of PSUs will receive a pro rata percentage based on a linear sliding scale of their respective award based on the pre-determined cumulative Adjusted EBITDA thresholds:

  35. Elements of Executive Compensation

    Failure to achieve the minimum cumulative Adjusted EBITDA will result in no shares becoming earned under the PSU awards. The aggregate grant date fair value of the long-term equity incentive awards for our NEOs are reflected in the “Stock Awards” column of the 2024 Summary Compensation Table. Retirement Benefits We have established certain retirement benefits for our employees, including our NEOs, which we believe are consistent with our goals of enhancing long-term performance by our employees. 401(k) Plan. Our 401(k) Plan is a tax-qualified defined contribution plan pursuant to which all U.S. based employees, including our NEOs, are eligible to participate. All employees are able to contribute a portion of their annual salary to the plan on a before-tax basis, subject to limitations imposed by the Internal Revenue Service. We currently match 50% of the first 6% of pay that employees contribute to the plan. All participant contributions to the plan are immediately vested and all company matching contributions vest pro rata over a three-year period. The plan contains a discretionary deferred profit sharing component, which, if made, has the same three-year vesting schedule as is applicable to company matching contributions. The amount of company matching contributions under this plan for our NEOs is included in the “All Other Compensation” column of the 2024 Summary Compensation Table. Non-Qualified Deferred Compensation. Our non-qualified deferred compensation plan allows our executive officers and directors to elect to defer designated percentages or amounts of their compensation. The plan also allows us to make discretionary contributions to the account of a plan participant, which are intended to provide the match that would have been made under our 401(k) Plan but for the limitations imposed on our 401(k) Plan under the Internal Revenue Code. None of our NEOs participate in this plan. Post-Retirement Health Benefit Plan. The post-retirement health benefit plan for officers is a group health plan that provides benefits to eligible retired officers and their spouses. The original effective date of the plan was December 23, 2006. Three kinds of benefits are provided under the plan: (i) long-term care insurance coverage; (ii) medical and dental insurance coverage; and (iii) medical premium reimbursement benefits. Officers who retire from active employment with us on or after December 23, 2006 at age 55 or older with five or more years of qualifying service and who do not work in any full-time employment (30 hours or more per week) after retirement are eligible to participate in the plan. Qualifying service is described as the individual’s most recent period of continuous, uninterrupted employment with us on or after the individual reaches age 50. Service with a business acquired by us is not counted as qualifying service. As of October 2019, only those individuals who as of July 22, 2019 were “Retirees” as defined in the plan or who are listed on an exhibit to the plan are eligible to participate in the plan. No other individuals are eligible to participate in the plan. None of our NEOs, except Mr. Rudow, is eligible to participate in the plan. 2024 Summary Compensation Table The following table shows certain information about the compensation of our NEOs for our three most recently completed fiscal years (if the individual was an NEO for that fiscal year).

  36. Elements of Executive Compensation

    | Name and Principal Position | Fiscal Year | Salary (1) ($) | Stock Awards (2) ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation (3) ($) | All Other Compensation (4) ($) | Total ($) | | Lee D. Rudow | 2024 | 639,282 | 1,127,440 | – | 652,700 | 21,038 | 2,440,460 | | President and Chief | 2023 | 523,654 | 439,979 | 187,700 | 272,357 | 20,444 | 1,444,134 | | Executive Officer | 2022 | 496,154 | 439,982 | – | 396,930 | 20,419 | 1,353,485 | | Thomas Barbato | 2024 | 338,913 | 437,018 | – | 207,691 | 11,207 | 994,829 | | Chief Financial Officer | 2023 | 275,000 | 179,024 | 93,850 | 114,308 | 8,779 | 670,961 | | Theresa A. Conroy | 2024 | 243,284 | 228,556 | – | 115,933 | 9,194 | 596,967 | | Senior Vice President, Human Resources | 2023 | 200,000 | 79,973 | 37,540 | 87,116 | 7,544 | 412,173 | | Mark A. Doheny | 2024 | 324,186 | 427,241 | – | 124,939 | 9,186 | 885,552 | | Former Chief | 2023 | 301,346 | 191,026 | 122,005 | 87,663 | 10,684 | 712,724 | | Operating Officer | 2022 | 284,625 | 178,758 | – | 155,198 | 8,697 | 627,278 | | James M. Jenkins | 2024 | 304,962 | 400,870 | – | 166,008 | 4,127 | 875,967 | | Former Chief Legal | 2023 | 252,808 | 150,029 | 65,695 | 139,553 | 11,268 | 619,353 | | Officer, Corporate Development Officer and Corporate Secretary | 2022 | 250,000 | 149,993 | – | 159,591 | 9,056 | 568,640 |

  37. Elements of Executive Compensation

    | Name | Fees Earned or Paid in Cash (1) ($) | Stock Awards (2) ($) | Option Awards (3) ($) | Total ($) | | Craig D. Cairns | 61,250 | 50,000 | — | 111,250 | | Dawn DePerrior | 12,500 | — | 431,800 | 444,300 | | Oksana S. Dominach | 70,000 | 50,000 | — | 120,000 | | Christopher P. Gillette | 25,000 | 50,000 | 492,200 | 567,200 | | Charles P. Hadeed | 63,750 | 50,000 | — | 113,750 | | Richard J. Harrison (4) | 30,000 | — | — | 30,000 | | Gary J. Haseley | 90,000 | 50,000 | — | 140,000 | | Mbago M. Kaniki | 63,750 | 50,000 | — | 113,750 | | Cynthia Langston | 50,000 | 50,000 | — | 100,000 | | Robert L. Mecca | 12,500 | — | 448,900 | 461,400 | | Paul D. Moore (5) | 37,500 | 50,000 | — | 87,500 |

  38. Elements of Executive Compensation

    | (2) The dollar amounts reported in this column represent the amount of “compensation actually paid,” or CAP, to the PEO in the applicable fiscal year, as computed in accordance with the SEC’s pay versus performance disclosure rules. The dollar amounts do not necessarily reflect the actual amount of compensation earned by or paid to the PEO during the applicable fiscal year. The following table provides additional information as to the amounts deducted from and added to the Summary Compensation Table Total for the PEO pursuant to the SEC’s rules to determine CAP to the PEO: |

  39. Analysis of the Information Presented in the Pay Versus Performance Table

    Analysis of the Information Presented in the Pay Versus Performance Table In accordance with Item 402(v) of Regulation S-K, the Company is providing the following graphs with respect to the relationships between information presented in the Pay Versus Performance table. CAP and TSR As demonstrated by the following table, the amount of compensation actually paid to Mr. Rudow and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Rudow) is aligned with the Company’s cumulative TSR over the four years presented in the table. The table also compares the Company’s cumulative TSR to the TSR of our peer group. The alignment of CAP with the Company’s cumulative TSR over the period presented is because a significant portion of the compensation actually paid to our NEOs is comprised of equity awards. As described in more detail in the section “Compensation Discussion and Analysis – Elements of Executive Compensation,” the Company’s executive compensation program is primarily performance-based, for both short-term incentives (annual cash bonuses) and long-term incentives (equity awards). CAP and Net Income As demonstrated by the following table, the amount of compensation actually paid to Mr. Rudow and the average amount of compensation actually paid to the Company’s NEOs as a group (excluding Mr. Rudow) is generally aligned with the Company’s net income over the last four completed fiscal years presented in the table.