DEF 14A of Aar Corp, Aug 8, 2023

DEF 14A of Aar Corp

Filed Aug 8, 2023 · FY20230001308179-23-000948

Open on EDGAR

  1. Information about our director nominees and our continuing directors

    Information about our director nominees and our continuing directors Information about our director nominees and our continuing directors whose terms expire in future years is set forth below.

  2. Our director nominees

    Our director nominees Class III Directors whose terms expire at the 2023 annual meeting:

  3. Our director nominees

    | Age: 58 Director since: 2023 Other public company directorships: ●None Other public company directorships held in the past five years: ●Atlas Air Worldwide Holdings, Inc. | John W. Dietrich Independent Director Skills and qualifications CEO experience, Finance, Accounting, Commercial aerospace, Military aerospace, Services, International business, Sales & marketing, Supply chain & logistics, Operating, M&A, Human resources, Risk management, Corporate governance, Government contracting, Safety Career highlights Executive Vice President and Chief Financial Officer, FedEx Corp., a global provider of transportation, e-commerce and business services, since August 2023. He previously served as President and Chief Executive Officer, Atlas Air Worldwide Holdings, Inc., a leading global provider of outsourced aircraft and aviation operating services, where he served from January 2020 until June 2023. He also served on the board of Atlas Air during that time. Prior to January 2020, he served in a number of executive leadership positions at Atlas Air, including President and Chief Operating Officer from July 2019 and Executive Vice President and Chief Operating Officer from September 2006. He previously held several senior leadership roles in legal, human resources and communications since joining Atlas Air in 1999. He also served as a litigation attorney at United Airlines prior to joining Atlas Air. Director qualifications The Board concluded that Mr. Dietrich should serve as a director of the Company based on his experience in the aviation industry, including as President and CEO of a public company, his knowledge of commercial and government aircraft services, and his expertise in operations, supply chain, human resources and risk management. |

  4. Our director nominees

    | Age: 67 Director since: July 2020 Other public company directorships held in the past five years: ●JetBlue Airways Corporation ●Howmet Aerospace, Inc. | Robert F. Leduc Independent Director Skills and qualifications CEO experience, Finance, Commercial aerospace, Military aerospace, Services, International business, Sales & marketing, Supply chain & logistics, Operating, M&A, Manufacturing, Human resources, Risk management, Corporate governance, Government contracting, Safety Career highlights President of Pratt & Whitney, an aerospace manufacturer and a subsidiary of United Technologies Corporation, from 2016 until his retirement early 2020. President of Sikorsky Aircraft, a helicopter manufacturer, from 2015 to 2016. Previously, served in leadership positions at Hamilton Sundstrand and UTC Aerospace Systems. He also serves as an advisor to Advent International. Director qualifications The Board concluded that Mr. Leduc should serve as a director of the Company based on his extensive experience in the aviation sector, his operational expertise managing through various down cycles, and his significant experience in enhancing brands and managing talent, in addition to his experience serving on other public company boards. |

  5. Our director nominees

    | 2023 Proxy Statement | 15 |

  6. Our director nominees

    | Age: 71 Director since: 2017 Other public company directorship: ●None Other public company directorships held in the past five years: ●Atlas Air Worldwide Holdings, Inc. | Duncan J. McNabb Independent Director Skills and qualifications Commercial aerospace, Military aerospace, Services, Supply chain & logistics, Operating, Government contracting, Risk management, Corporate governance, Safety Career highlights Since 2011, Co-Founder and Managing Partner of Ares Mobility Solutions Inc., a privately-held logistics business; General, U.S. Air Force (Retired) after 37 years of active commissioned service. Former Commander, U.S. Air Mobility Command, 33rd Vice Chief of Staff of the U.S. Air Force and Former Commander of US TRANSCOM. Director qualifications The Board concluded that General McNabb should serve as a director of the Company based on his government resourcing and government affairs expertise, his strategic planning, operations and leadership skills and his 37-year record of service with the United States Air Force, including his service as Commander of the United States Transportation Command (the single manager for global air, land and sea transportation for the Department of Defense). |

  7. Our director nominees

    | Age: 77 Director since: 2011 Other public company directorship: ●None Other public company directorships held in the past five years: ●Qualys, Inc. ●Rigetti Computing, Inc. | Peter Pace Independent Director Skills and qualifications Commercial aerospace, Military aerospace, Services, Supply chain & logistics, Operating, Government contracting, Information technology / cyber / innovation, Human resources, Risk management, Corporate governance, Safety Career highlights General, U.S. Marine Corps (Retired). From 2005 to 2007, Chairman of the Joint Chiefs of Staff, the most senior position in the United States Armed Forces. Director qualifications The Board concluded that General Pace should serve as a director of the Company based on his leadership and management skills and experience from over 40 years of service with the United States Marine Corps, culminating in his appointment as the 16th Chairman of the Joint Chiefs of Staff (where he served from 2005 to 2007 as the principal military advisor to the President, the Secretary of Defense, the National Security Council and the Homeland Security Council), his understanding of the government and defense markets, his cybersecurity expertise and his current and prior service as a director of other public companies. |

  8. Our director nominees

    | 16 | |

  9. Our director nominees

    Class I Directors whose terms expire at the 2024 annual meeting:

  10. Our director nominees

    | Age: 67 Director since: 2012 Other public company directorships: ●Avery Dennison Corp. ●Exelon Corp. ●Marsh & McLennan Companies Other public company directorships held in the past five years: ●First American Financial Corporation | Anthony K. Anderson Independent Director Skills and qualifications CEO experience, Finance, Accounting, Services, Sales & marketing, Operating, M&A, Risk management, Corporate governance Career highlights Since April 2012, an independent business consultant. From 2006 to April 2012, Vice Chair and Managing Partner of Midwest Area at Ernst & Young LLP, a global accounting and consulting firm. Prior thereto, Mr. Anderson served in various management positions during a 35-year career with Ernst & Young LLP. Director qualifications The Board concluded that Mr. Anderson should serve as a director of the Company based on his 35 years working with a global accounting and consulting firm, his accounting and financial knowledge, his leadership in developing talent management programs, his service as a director of other public companies, and his professional, civic and charitable service, including as a director of private companies and numerous not-for-profit organizations. The Board also values his risk management experience and his knowledge and experience with corporate governance matters. |

  11. Our director nominees

    | Age: 75 Director since: 2005 Other public company directorships: ●None Other public company directorships held in the past five years: ●Stepan Company | Michael R. Boyce Independent Director Skills and qualifications CEO experience, Finance, International business, Sales & marketing, Supply chain & logistics, Operating, M&A, Manufacturing, Risk management, Corporate governance, Safety Career highlights Since 2018, Chairman, Chief Executive Officer and Managing Director of Peak Investments, LLC (an operating and acquisition company). Retired Chairman of the Board of PQ Corporation (a specialty chemicals and catalyst company) where he served from 2017 to 2019. From 2005 to 2017, Chairman and Chief Executive Officer of PQ Corporation. Director qualifications The Board concluded that Mr. Boyce should serve as a director of the Company based on his experience in leading two global organizations, his insight into global manufacturing, supply and distribution practices and his international business development skills. |

  12. Our director nominees

    | 2023 Proxy Statement | 17 |

  13. Our director nominees

    | Age: 61 Director since: 2016 Other public company directorships: ●Sun Country Airlines Holdings, Inc. Other public company directorships held in the past five years: ●American Science and Engineering, Inc. ●Clearwire Corporation ●Virgin America, Inc. | Jennifer L. Vogel Independent Director Skills and qualifications Commercial aerospace, Services, International business, M&A, Government contracting, Human resources, Risk management, Corporate governance, Safety Career highlights 2012 to 2020, co-founder and owner of InVista Advisors, an advisory firm focused on legal department effectiveness, leadership, compliance, crisis readiness and risk management. From 2003 to 2010, Senior Vice President, General Counsel, Secretary and Chief Compliance Officer of Continental Airlines, Inc. Director qualifications The Board concluded that Ms. Vogel should serve as a director of the Company based on her experience as a highly successful corporate executive with over 25 years of leadership experience in the airline and energy industries, including her leadership positions with Continental Airlines, her legal and corporate governance expertise, her experience in regulatory issues, mergers and acquisitions, ethics and compliance matters and her experience as a director of other public companies, including Sun Country Airlines Holdings, Inc. and Virgin America, Inc. |

  14. Our director nominees

    Class II Directors whose terms expire at the 2025 annual meeting:

  15. Our director nominees

    | President and Chief Executive Officer of AAR CORP. Age: 46 Director since: 2017 Other public company directorships: ●None | John M. Holmes Chairman of the Board Skills and qualifications CEO experience, Finance, Commercial aerospace, Services, International business, Sales & marketing, Supply chain & logistics, Operating, M&A, Human resources, Risk management, Corporate governance, Safety Career highlights Chairman of the Board since January 2023. President and Chief Executive Officer of AAR CORP. since June 1, 2018. President and Chief Operating Officer from June 1, 2017 to June 1, 2018. From 2015 to June 1, 2017, Chief Operating Officer of the Aviation Services business group of AAR CORP. From 2012 to 2015, Group Vice President, Aviation Services – Inventory Management and Distribution; and prior thereto, General Manager and Division President of AAR Allen Asset Management. Director qualifications The Board concluded that Mr. Holmes should serve as a director of the Company based on his position as President and Chief Executive Officer, his demonstrated leadership and management abilities, and his knowledge of the Company’s businesses, its portfolio of services and the markets in which it competes, and the customer and supplier relationships that Mr. Holmes has developed during his 20-year tenure with the Company. |

  16. Our director nominees

    | 18 | |

  17. Our director nominees

    | Age: 63 Director since: 2021 Other public company directorships: ●Comtech Telecommunications Corp. ●Parsons Corporation | Ellen M. Lord Independent Director Skills and qualifications CEO experience, Finance, Commercial aerospace, Military aerospace, Services, International business, Sales & marketing, Supply chain & logistics, Operating, M&A, Manufacturing, Government contracting, Information technology / cyber / innovation, Risk management, Safety Career highlights Served as the Under Secretary of Defense for Acquisition and Sustainment for the United States Department of Defense from August 2017 until January 2021. President and Chief Executive Officer of Textron Systems from October 2012 to August 2017. Prior to that, served in other leadership positions at Textron Systems and related companies. Director qualifications The Board concluded that Ms. Lord should serve as a director of the Company based on her leadership, management and strategic planning expertise she acquired while serving as the Under Secretary of Defense for Acquisition and Sustainment for the United States Department of Defense, as well as her experience in the private sector working as the Chief Executive Officer of Textron Systems, where she led a multi-billion dollar company with products and services supporting defense, homeland security, aerospace and infrastructure protection. |

  18. Our director nominees

    | Age: 71 Director since: 2003 Other public company directorships: ●None | Marc J. Walfish Lead Independent Director Skills and qualifications Finance, Accounting, Sales & marketing, M&A, Risk management Career highlights Founding Partner of Merit Capital Partners, a mezzanine investor company formerly known as William Blair Mezzanine Capital Partners, since 1991. From 1978 to 1991, various positions at Prudential Capital Corporation. Director qualifications The Board concluded that Mr. Walfish should serve as a director of the Company based on his experience in the finance industry, including as a founding partner of Merit Capital Partners, his knowledge of the capital markets and his expertise in corporate finance, strategic planning and risk management. |

  19. Our director nominees

    | 2023 Proxy Statement | 19 |

  20. Director compensation

    Director compensation The Board reviews director compensation annually to ensure that it is fair, appropriate and in line with AAR’s peer group companies. The Board’s policy is to periodically undertake an in-depth analysis of the type and amount of each element of director compensation in consultation with the Human Capital and Compensation Committee’s independent compensation consultant. The Fiscal 2023 director compensation program, as approved by the Board, consists of the following compensation elements:

  21. Director compensation

    | Compensation element | Fiscal 2023 non-employee director compensation program | | Board chair additional annual retainer | None* | | Non-employee director annual retainer | $95,000 | | Lead director additional annual retainer | $30,000 | | Audit Committee chair annual retainer | $20,000 | | All other Committee chair additional annual retainer | $15,000 | | Annual restricted stock award | Shares of common stock with a total grant date dollar value of $125,000 (vesting after one year) |

  22. Director compensation

    | * Our current Chairman, John M. Holmes, does not receive any director-related compensation because he is an employee of the Company. Our former Chairman, David M. Storch, received compensation under our director compensation program in Fiscal 2023, including an additional annual retainer of $150,000 for serving as Chairman through his retirement date of January 10, 2023. |

  23. Director compensation

    All retainers are paid quarterly. The annual stock award for Fiscal 2023 had an effective date of June 1, 2022 and a vesting date of June 1, 2023, subject to the director’s continued service through such date. Each non-employee director, upon being elected a director, receives term life insurance coverage of $200,000 (unless or until they notify the Company that they wish to opt out of coverage and sign a waiver) and is eligible (along with their spouse, as applicable) to participate in a Company-paid annual physical program. The Company also reimburses its non-employee directors for travel, lodging and related expenses that they incur in attending Board and committee meetings and for other Company business expenses.

  24. Cap on director compensation

    Cap on director compensation Our stock plan, as approved by the Company’s stockholders, caps the annual compensation of non-employee directors at $500,000 per director. This cap takes into account all cash and non-cash compensation (including the dollar value of all stock awards) paid in a single fiscal year. The reasons for this cap on director compensation are to protect against conflicts of interest given that the directors approve their own compensation and to ensure that directors receive fair and reasonable, but not excessive, compensation for their services.

  25. Cap on director compensation

    | 34 | |

  26. Ability to defer director compensation

    Ability to defer director compensation Non-employee directors may elect to defer receipt of their compensation under the Company’s Non-Employee Directors’ Deferred Compensation Plan (the “Director Plan”). Under the Director Plan, non-employee directors may defer retainers and stock awards into (a) a stock account, with the deferred compensation converted into stock units equivalent to shares of common stock based on the then current stock price, or (b) a cash account, with the deferred compensation credited with interest quarterly based on the 10-year United States Treasury Bond rate. Distributions of deferred compensation are made, at the participant’s election, in cash or in shares of common stock. Distribution occurs upon termination of service on the Board or on other dates as specified by the participant.

  27. Director compensation table

    Director compensation table

  28. Fiscal 2023 director compensation

    Fiscal 2023 director compensation The table below sets forth all compensation paid to each non-employee director for Fiscal 2023.

  29. Fiscal 2023 director compensation

    | Name(1) | Fees earned or paid in cash ($)(2) | Stock awards ($)(3) | Option awards ($)(4) | All other compensation ($)(5) | Total ($) | | Anthony K. Anderson | 95,000 | 125,000 | — | 7,509 | 227,509 | | Michael R. Boyce | 95,000 | 125,000 | — | 20,905 | 240,905 | | John W. Dietrich | 19,878 | 28,075 | — | 311 | 48,264 | | H. John Gilbertson, Jr. | 55,975 | 125,000 | — | 598 | 181,573 | | James E. Goodwin | 53,942 | 125,000 | — | 478 | 179,420 | | Robert F. Leduc | 95,000 | 125,000 | — | 4,769 | 224,769 | | Ellen M. Lord | 95,000 | 125,000 | — | 1,614 | 221,614 | | Duncan J. McNabb | 110,000 | 125,000 | — | 2,746 | 237,746 | | Peter Pace | 95,000 | 125,000 | — | 1,614 | 221,614 | | David P. Storch | 150,403 | 125,000 | — | 186,989 | 462,392 | | Jennifer L. Vogel | 95,000 | 125,000 | — | 1,148 | 221,148 | | Marc J. Walfish | 135,934 | 125,000 | — | 1,614 | 262,548 |

  30. Fiscal 2023 director compensation

    | (1) Mr. Holmes is not included in this table because, as an employee director of the Company, he received no additional compensation for his service as a director in Fiscal 2023. Mr. Holmes’s compensation is set forth in the Summary Compensation Table in this proxy statement. Mr. Dietrich’s compensation for Fiscal 2023 was pro-rated based on his appointment to the Board on March 16, 2023. Mr. Gilbertson resigned from the Board effective October 27, 2022. Mr. Goodwin retired from the Board effective September 20, 2022. Mr. Storch retired from the Board effective January 10, 2023. | | (2) The following table provides a breakdown of director fees earned or paid in cash for Fiscal 2023. Messrs. Leduc and Walfish elected to defer their retainers pursuant to the Company’s Non-Employee Directors’ Deferred Compensation Plan. |

  31. Fiscal 2023 director compensation

    | Name | Annual retainer ($) | Board chair and committee chair retainer fees ($) | Lead director fee ($) | Total ($) | | Anthony K. Anderson | 95,000 | — | — | 95,000 | | Michael R. Boyce | 95,000 | — | — | 95,000 | | John W. Dietrich | 19,878 | — | — | 19,878 | | H. John Gilbertson | 38,626 | 17,349 | — | 55,975 | | James Goodwin | 28,970 | 15,824 | 9,148 | 53,942 | | Robert F. Leduc | 95,000 | — | — | 95,000 | | Ellen M. Lord | 95,000 | — | — | 95,000 | | Duncan J. McNabb | 95,000 | 15,000 | — | 110,000 | | Peter Pace | 95,000 | — | — | 95,000 | | David Storch | 58,320 | 92,083 | — | 150,403 | | Jennifer L. Vogel | 95,000 | — | — | 95,000 | | Marc J. Walfish | 95,000 | 20,000 | 20,934 | 135,934 |

  32. Fiscal 2023 director compensation

    | (3) The amounts in this column reflect the aggregate grant date fair value of the Fiscal 2023 stock award of 2,574 shares of time-based restricted stock granted on June 1, 2022 to each non-employee director computed in accordance with FASB ASC Topic 718. These shares subsequently vested on June 1, 2023. General McNabb elected to defer his entire stock award. | | (4) No stock options were granted to non-employee directors in Fiscal 2023. No current non-employee director held any stock options as of May 31, 2023. | | (5) This column includes the cost of the annual physical program, reimbursements for travel, lodging and hotel expenses in connection with the annual physical program, and the cost of term life insurance coverage. For Mr. Storch, this column includes $30,000 in office/secretarial support and $156,989 in consulting fees from the Company in Fiscal 2023 pursuant to a consulting agreement as noted under the heading “Related person transaction policy.” |

  33. Fiscal 2023 director compensation

    | 2023 Proxy Statement | 35 |

  34. Fiscal 2023 director compensation

    | Proposal 2 Executive compensation | |

  35. Fiscal 2023 director compensation

    | Proposal 2 | Advisory proposal to approve our Fiscal 2023 executive compensation |

  36. Fiscal 2023 director compensation

    | | Our Board unanimously recommends that you vote FOR this resolution approving the Fiscal 2023 compensation paid to our named executive officers. |

  37. Response to stockholder feedback

    | WHAT WE HEARD… | HOW WE RESPONDED FOR FISCAL 2024… | | Stockholders questioned both the design and the magnitude of the CEO’s special award of cash and equity in Fiscal 2022 (that was intended to compensate him for two years of forgone equity awards due to CARES Act restrictions). In particular, stockholders noted that the award was entirely time-based (lacking performance conditions). | We engaged with our stockholders and noted the unusual circumstances during Fiscal years 2021 and 2022 that influenced the decisions to grant special awards without performance conditions to certain members of our senior management team, including our CEO, in Fiscal 2022, as set forth above in the Letter from our Human Capital and Compensation Committee. In response to stockholder concerns following the 2022 say-on-pay vote, the Committee has committed to both continue to limit the usage of one-time, special awards outside of our annual compensation program and, if granted to our executive officers, to include performance conditions when making such one-time, special awards (except in very limited circumstances where it is customary not to include performance conditions, such as grants to replace foregone compensation at the time of hire). To further demonstrate the Committee’s commitment to performance-based compensation, the Committee is making the following changes to the Company’s annual executive compensation program for Fiscal 2024: ●Increasing the weighting of performance-based share awards (performance-based restricted stock) for executive officers in the long-term incentive plan from 50% to 60% and reducing the weighting of time-based share awards (i.e., changing the components of the long-term incentive plan from 50% performance-based restricted stock, 25% options and 25% time-based restricted stock in the current program to 60% performance-based restricted stock, 20% options and 20% time-based restricted stock in the program for Fiscal 2024); and ●Broadening participation in our performance-based restricted stock program. | | Stockholders questioned the use of qualitative strategic goals as metrics for determining short-term incentive compensation and suggested eliminating such strategic goals in favor of quantitative and measurable financial goals. | In response to stockholder feedback, the Committee is making the following change to the Company’s short-term incentive compensation program for Fiscal 2024: ●Eliminating the qualitative strategic goals component of awards under the short-term incentive plan and reverting to a split of 80% earnings per share (“EPS”) and 20% working capital turns (i.e., changing the components from 60% EPS, 20% working capital turns and 20% strategic objectives in Fiscal 2023). The Committee will continue to evaluate appropriate quantitative goals that can be introduced into the Company’s short-term incentive compensation program, including potential quantitative ESG metrics. | | Stockholders questioned the 250% maximum payout opportunity for performance-based restricted stock awards in the long-term incentive program and noted that they considered 200% to be more typical. | Although unusual circumstances influenced the special awards to the CEO in Fiscal 2022, the Committee acknowledges stockholder feedback regarding the magnitude of long-term incentive awards generally. In response to stockholder concerns, the Committee is making the following change to the Company’s executive compensation program for Fiscal 2024: ●Reducing the maximum payout for performance-based restricted stock in the long-term incentive plan from 250% in the Fiscal 2023 program to 200% in the Fiscal 2024 program. | | Stockholder feedback was varied in terms of whether and how to incorporate relative total shareholder return (TSR) in relation to company-specific financial and operational metrics for determining long-term incentive compensation. Select stockholders indicated a preference to see target payout anchored at some level above median performance. | The Human Capital and Compensation Committee thoughtfully considered the varied stockholder feedback on the use of relative TSR as a performance metric for determining long-term incentive compensation. After careful consideration, the Committee is making the following change to the Company’s executive compensation program for Fiscal 2024 in response to stockholder feedback: ●Setting the TSR target payout at outperformance of the market rather than median performance (i.e., 55th percentile as compared to 50th percentile used in the Fiscal 2023 program). |

  38. Response to stockholder feedback

    We remain committed to giving our investors clear and concise proxy statement disclosure so that they can fully understand our executive compensation program and, in turn, vote on an informed basis on our say-on-pay proposal. To that end, our proxy statement disclosure explains both how our executive compensation program operates and how it aligns the interests of our executives with the long-term investment interests of our stockholders. Our ongoing, open dialogue with our stockholders helps ensure that our Board and management regularly consider investor perspectives. The Human Capital and Compensation Committee continues to believe in flexibility to properly incentivize and reward management for successfully managing the Company in unusual circumstances and positioning it for future growth. This flexible approach to executive compensation is consistent with our Board’s priorities to guide the Company in the proper strategic direction. Pay and Performance Alignment. The graph below highlights our recent relative share performance as compared to the share performance of our peer group and also demonstrates the strong linkage between our TSR performance and our CEO’s pay. The peer group used is the Company’s “2023 peer group” as reflected in our 2023 Annual Report on Form 10-K pursuant to Item 201(e) of Regulation S-K and “Fiscal 2023 peer group” in this proxy statement. Each year reflects what the cumulative value of $100 would be, including reinvestment of dividends, if such amount were invested on June 1, 2020.

  39. Company TSR, Peer Group TSR and Company CEO Pay

    Company TSR, Peer Group TSR and Company CEO Pay

  40. Pay-for-performance and stockholder alignment

    | ● | Annual cash bonuses are linked to two key performance metrics critical to the success of our business strategy: adjusted diluted earnings per share from continuing operations (60%) and adjusted net working capital turns (20%). In addition, certain strategic objectives (20%) are included in the annual cash bonus program for Fiscal 2023 to align management interests with priorities that are important to the Company. | | ● | The Fiscal 2023 long-term incentive program is 100% equity based, consisting of performance-based restricted stock (50%), stock options (25%) and restricted stock awards (25%). | | ● | Performance-based restricted stock for Fiscal 2023 are linked to three key performance metrics: adjusted income from continuing operations (70%), return on invested capital (20%) and relative total stockholder return (10%). | | ● | AAR targets total pay opportunities for its executive officers, individually and as a group, within a competitive range around the median of the market. | | ● | AAR’s compensation mix – cash versus equity, fixed versus variable, and annual versus longer-term – is consistent with competitive best practices. |

  41. Cash bonuses under the Fiscal 2023 short-term incentive plan

    Cash bonuses under the Fiscal 2023 short-term incentive plan

  42. Cash bonuses under the Fiscal 2023 short-term incentive plan

    | Strategic goal | Compensation measure | | | Drive profitability and deliver value to stockholders | 60% | Adjusted diluted earnings per share from continuing operations | | Make efficient use of stockholder capital in support of Company sales | 20% | Adjusted net working capital turns | | Align management’s interests with priorities that are important to the Company | 20% | Strategic objectives |

  43. Performance stock under the Fiscal 2023 long-term incentive plan

    Performance stock under the Fiscal 2023 long-term incentive plan

  44. Performance stock under the Fiscal 2023 long-term incentive plan

    | Strategic goal | Compensation measure | | | Increase profitability and deliver value to stockholders | 70% | Adjusted income from continuing operations | | Enhance efficiency in allocating capital to generate higher returns | 20% | Average return on invested capital | | Outperform peer group companies* in generating stockholder value | 10% | Relative total stockholder return |

  45. Performance stock under the Fiscal 2023 long-term incentive plan

    | * Reflects a custom group of companies that derive a significant portion of their revenues from commercial aviation-linked businesses. For Fiscal 2023, this group included Alaska Air Group, Allegiant Travel Company, American Airlines Group Inc., Atlas Air Worldwide Holdings, Inc., Delta Air Lines, Inc., Hawaiian Holdings, Inc., Hexcel Corporation, JetBlue Airways Corporation, Moog Inc., Southwest Airlines Co., Spirit AeroSystems Holdings, Inc., Spirit Airlines, Inc., The Boeing Company, Triumph Group, Inc., United Airlines Holdings, Inc., and Woodward, Inc. |

  46. Our executive compensation goals and philosophy

    | Compensation element | Target | | | | Base salary | ± | 10% | of market median | | “Total annual cash compensation” (base salary + target annual cash bonus) | ± | 10% | of market median | | “Total direct compensation” (base salary + target annual cash bonus + the grant date value of annual stock awards) | ± | 15% | of market median |

  47. Executive compensation practices

    | What We Do | What We Do Not Do | | Annual say-on-pay stockholder vote Challenging performance targets under our incentive compensation plans Emphasis on performance-based or at-risk compensation Multi-year vesting periods for stock awards Limited perquisites “Double trigger” change-in-control provisions in executive agreements Meaningful stock ownership and retention guidelines for directors and executive officers Prohibition on short sales, pledging and hedging transactions Claw-backs of incentive compensation in the event of certain financial restatements Annual assessment of incentive compensation plans | No tax gross-ups No repricing of stock options No dividends or dividend equivalents paid on stock or stock unit awards unless vesting conditions are met |

  48. Principal elements of our Fiscal 2023 executive compensation program

    | | Compensation element | Form of compensation | Performance period | Performance measures | | Purposes of the compensation element | | | Base salary | Cash | 1 year | Individual performance and contributions Qualifications and responsibilities Experience and tenure with the Company Competitive salary considerations | | Rewards individual performance and contributions consistent with an individual’s position and responsibilities Provides competitive compensation Balances risk-taking concerns associated with performance-based compensation | | | Annual cash bonus | Cash | 1 year | | Adjusted diluted earnings per share from continuing operations | Promotes retention of executive talent Provides short-term, cash-based incentive Measures performance against key corporate goals Aligns management’s interests with priorities that are important to the Company, including growth and ESG | | | | | | | Adjusted net working capital turns | | | | | | | | Strategic objectives | | | | Stock options (25%) | Stock | 3 years (vesting period) Up to 10 years (option term) | | Stock price | Promotes retention of executive talent Aligns payout directly with stockholder value creation | | | Time-based restricted stock (25%) | Stock | 3 years | | Stock price | Promotes retention of executive talent Aligns payout directly with stockholder value creation | | | Performance-based restricted stock (50%) | Stock | 3 years | | Adjusted income from continuing operations | Promotes retention of executive talent Ties payout to achievement of key corporate goals Aligns payout directly with stockholder value creation | | | | | | | Average return on invested capital | | | | | | | | Relative shareholder return | |

  49. January 2022

    | | Reviewed and approved the Company’s Fiscal 2023 peer group. | | | |

  50. June and July 2022

    | | Assessed the Company’s prior year’s target executive compensation against the target executive compensation of the Company’s peer group companies and of other aerospace and defense companies. | | | Assessed the Company’s prior year performance against the performance of peer group companies. | | | Considered other information available at the time relevant to the Fiscal 2023 executive compensation program (e.g., the prior year (Fiscal 2021) say-on-pay result and the CEO’s recommendations). | | | Set target Fiscal 2023 compensation — base salaries, annual cash bonuses and stock awards — for the Company’s executive officers. | | | |

  51. July 2023

    | | Approved Fiscal 2023 annual cash bonuses based on the Company’s performance in Fiscal 2023. |

  52. Fiscal 2023 cash bonuses

    Fiscal 2023 cash bonuses

  53. Fiscal 2023 short-term incentive plan – setting targets

    Fiscal 2023 short-term incentive plan – setting targets At its July 2022 meeting, the Human Capital and Compensation Committee approved the Fiscal 2023 short-term incentive plan for the named executive officers. The Fiscal 2023 short-term incentive plan used three performance goals to determine annual cash bonuses: (1) the Company’s earnings per share from continuing operations as adjusted (weighted 60%), (2) the Company’s adjusted net working capital turns (weighted 20%) and (3) certain strategic objectives (weighted 20%). The strategic objectives goal was added to the annual cash bonus program in Fiscal 2021 in order to align management’s interests with priorities that are important to the Company. The strategic objectives for Fiscal 2023 were the same as Fiscal 2022 and included the following: (A) identify and secure opportunities to deploy capital for organic and inorganic growth, and (B) drive an environmental, social and corporate governance program that addresses key areas of focus. The following table shows each of the three performance goals at the threshold, target and maximum levels:

  54. Fiscal 2023 short-term incentive plan – setting targets

    | Performance goal | | Threshold | Target | Maximum | | 60% | Adjusted diluted earnings per share from continuing operations (weighting) | $1.93 | $2.57 | $3.21 | | 20% | Adjusted net working capital turns (weighting) | 2.29 | 3.05 | 3.81 | | 20% | Strategic objectives (weighting) | N/A | N/A | N/A |

  55. Fiscal 2023 short-term incentive plan – setting targets

    Each of the adjusted diluted earnings per share from continuing operations target ($2.57) and the adjusted net working capital turns target (3.05) for Fiscal 2023 represents an increase from both the prior year’s target (an increase of $0.77 and 0.35, respectively) and actual performance (an increase from the prior year’s results, which were $2.38 and 2.96, respectively).

  56. Fiscal 2023 short-term incentive plan – setting targets

    | 50 | |

  57. Fiscal 2023 short-term incentive plan – setting targets

    The Human Capital and Compensation Committee believes adjusted diluted earnings per share from continuing operations and adjusted net working capital turns are critical performance measures of the Company’s financial success. Adjusted diluted earnings per share from continuing operations measures the Company’s performance in delivering earnings to stockholders, and adjusted net working capital turns measures the Company’s effectiveness in using its working capital and, in particular, in using its cash.

  58. Fiscal 2023 short-term incentive plan – setting targets

    | ● | “Adjusted diluted earnings per share from continuing operations” is defined under the Fiscal 2023 short-term incentive plan as adjusted diluted earnings per share from continuing operations as disclosed by the Company in its earnings release furnished with the Securities and Exchange Commission, excluding non-GAAP items included on the Company’s quarterly earnings releases, special charges or unusual or infrequent items incurred during the performance period, and as may be adjusted for changes in generally accepted accounting principles. | | ● | “Adjusted net working capital turns” is defined under the Fiscal 2023 short-term incentive plan as net sales divided by adjusted average working capital, where working capital is defined as net accounts receivable plus net inventories minus accounts payable, excluding non-GAAP items included on the Company’s quarterly earnings releases, special charges or unusual or infrequent items incurred during the performance period, including changes in the Company’s accounts receivable financing program, and as may be adjusted for changes in generally accepted accounting practices. |

  59. Fiscal 2023 short-term incentive plan – setting targets

    In calculating adjusted diluted earnings per share from continuing operations and adjusted net working capital turns, the Human Capital and Compensation Committee has the discretion to exclude special charges or unusual or infrequent items incurred during the performance period and to adjust for changes in GAAP if it determines that such exclusions or adjustments are appropriate. The Committee exercises this discretion with respect to special charges infrequently, typically limiting it to situations where the special charge was non-recurring or unforeseen and not within the control of management. In addition, the Committee maintains the discretion to adjust amounts further downward. The Fiscal 2023 annual cash bonus opportunities (in dollar amounts and as a percentage of base salary), at the threshold, target and maximum levels for the named executive officers are set forth in the table below, with performance between threshold and target levels and between target and maximum levels resulting in proportionate straight-line payouts:

  60. Fiscal 2023 short-term incentive plan – setting targets

    | | Threshold | | Target | | Maximum | | | Named executive officer | Dollar amount ($) | Percent of base salary (%) | Dollar amount ($) | Percent of base salary (%) | Dollar amount ($) | Percent of base salary (%) | | John M. Holmes | 500,000 | 50 | 1,000,000 | 100 | 2,000,000 | 200 | | Sean M. Gillen | 240,000 | 50 | 480,000 | 100 | 960,000 | 200 | | Jessica A. Garascia | 215,000 | 50 | 430,000 | 100 | 860,000 | 200 | | Christopher A. Jessup | 240,000 | 50 | 480,000 | 100 | 960,000 | 200 | | Eric S. Pachapa | 135,000 | 38 | 270,000 | 75 | 540,000 | 150 |

  61. Fiscal 2023 short-term incentive plan – approving payouts

    Fiscal 2023 short-term incentive plan – approving payouts For Fiscal 2023, we reported adjusted diluted earnings per share from continuing operations of $2.86 and achieved adjusted net working capital turns of 3.06. As noted, the Human Capital and Compensation Committee has the discretion under the short-term incentive plan to exclude or add back one-time special charges that it considers unusual or unforeseen and outside of management’s control. The adjusted net working capital turns of 3.06 resulted in a payout of 101% for that portion of the metric. Adjusted diluted earnings per share from continuing operations was $2.86, which has been adjusted to exclude non-GAAP adjustments externally reported of $0.52 which include losses related to sale and exit of business of $0.02, Trax acquisition and amortization expenses of $0.21, loss on equity investments, net of $0.01, investigation and remediation compliance costs of $0.13, contract termination/restructuring costs and loss provisions, net of $0.06, customer bankruptcy and credit charges of $0.04, and Russian bankruptcy court clawback judgment of $0.05, which were partially offset by government COVID-related subsidies, net of $0.05 and tax effect on adjustments of $0.13. The Human Capital and Compensation Committee determined that these adjustments were appropriate as they are the same adjustments made and reported in connection with the Company’s earnings releases. The resulting payout for this metric was 145%.

  62. Fiscal 2023 short-term incentive plan – approving payouts

    | 2023 Proxy Statement | 51 |

  63. Fiscal 2023 short-term incentive plan – approving payouts

    For the strategic objectives the Human Capital and Compensation Committee reviewed each objective, and determined that due to the following factors, as well as the Company’s strong financial performance that was positively influenced by these factors, a payout of 150% for this metric was appropriate:

  64. Fiscal 2023 short-term incentive plan – approving payouts

    | Objective | Factors | | Identify and secure opportunities to deploy capital for organic and inorganic growth | ●Sourced, due diligenced and acquired Trax USA Corp. ●New or expanded distribution agreements with Unison, Leach, Ontic, and GE Aerospace ●Disciplined investments in USM market, including acquisition of nine B757 aircraft from American Airlines ●First and only non-OEM to receive a Captains of Industry contract award with Defense Logistics Agency ●Digital investments to foster top-line growth and improve efficiencies across the company ●Extension of our long-term component support contract with flydubai for their B737 fleet ●Evaluated hangar footprint to identify and progress expansion opportunities ●Evaluated multiple potential acquisition targets to expand the business ●Initial shipments to the Japanese Ministry of Defense from our new joint venture with Sumitomo ●Started up operations in Poland on the recently awarded long-term contract from USAFE to support F-16 aircraft in Europe ●Completed refinancing and extension of our revolving credit facility | | Drive an environmental, social and corporate governance program that addresses key areas of focus | ●Performed materiality assessment to identify key areas of focus for ESG, and publicly reported results ●Launched second ESG report in Fiscal 2023, with plans to issue supplemental information in Fiscal 2024 ●Won numerous awards as a result of ESG efforts including: ●Named to Newsweek’s America’s Greatest Workplaces 2023 ●Named to Newsweek’s America’s Greatest Workplaces for Diversity 2023 ●Continued community involvement by supporting numerous charities ●Continued compliance enhancements, including building out control environment for compliance testing |

  65. Fiscal 2023 short-term incentive plan – approving payouts

    Giving weighting to all of these items, the total payout under the short-term incentive plan was 137%, and the resulting bonuses for each named executive officer are listed below.

  66. Fiscal 2023 short-term incentive plan – approving payouts

    | | Fiscal 2023 short-term incentive plan | | | Named executive officer | Target bonus ($) | Actual bonus ($) | | John M. Holmes | 1,000,000 | 1,370,000 | | Sean M. Gillen | 480,000 | 657,600 | | Jessica A. Garascia | 430,000 | 589,100 | | Christopher A. Jessup | 480,000 | 657,600 | | Eric S. Pachapa | 270,000 | 369,900 |

  67. Fiscal 2023 short-term incentive plan – approving payouts

    | 52 | |

  68. Fiscal 2023 stock awards

    Fiscal 2023 stock awards In July 2022, the Human Capital and Compensation Committee approved awards of performance-based restricted stock,time-based restricted stock and stock options to our named executive officers under the Fiscal 2023 long-term incentive plan. The Committee continued from the prior year the practice of having 50% of the annual stock awards comprised of performance-based restricted stock. The Human Capital and Compensation Committee determined the types and dollar amounts of stock awards to be granted for Fiscal 2023, based on a number of factors, including:

  69. Stock awards for other employees

    Stock awards for other employees The Human Capital and Compensation Committee’s use of performance-based restricted stock is intended to motivate executives to drive corporate performance, specifically with respect to adjusted income from continuing operations performance, adjusted return on invested capital performance and relative total stockholder return. The performance-based restricted stock is forfeited unless the Company achieves these performance goals at designated threshold levels over the three-year performance period. The Committee’s use of stock options is intended to focus executives on stock price appreciation. Stock options only have value to an executive if the Company’s stock price increases above its grant date value, thus providing a “win-win” for the executives and the Company’s stockholders. The Committee’s use of time-vested restricted stock is intended to promote retention and align the interests of our named executive officers with those of our stockholders. In these ways, the stock component of the Company’s executive compensation program fully reflects a pay-for-performance emphasis.

  70. Performance-based restricted stock

    Performance-based restricted stock The Human Capital and Compensation Committee approved the following grants of restricted stock awards for Fiscal 2023, subject to performance-based vesting:

  71. Performance-based restricted stock

    | | Fiscal 2023 performance-based restricted stock | | | Named executive officer | Number of shares at target | Grant date fair value ($) | | John M. Holmes | 43,580 | 1,825,130 | | Sean M. Gillen | 10,150 | 425,082 | | Jessica A. Garascia | 5,970 | 250,024 | | Christopher A. Jessup | 10,150 | 425,082 | | Eric S. Pachapa | 4,810 | 201,443 |

  72. Performance-based restricted stock

    The grant date fair value in the table above was based on the $41.88 closing price of the Common Stock on the July 18, 2022 date of grant.

  73. Performance-based restricted stock

    | 2023 Proxy Statement | 53 |

  74. Performance-based restricted stock

    The Human Capital and Compensation Committee designated adjusted income from continuing operations (weighted 70%), return on invested capital (weighted 20%) and relative total stockholder return (10%) as the three performance goals for the performance-based restricted stock under the Fiscal 2023 long-term incentive plan. The Committee believes these three measures are appropriate because they capture critical elements of the Company’s performance over the three-year performance period beginning June 1, 2022 and ending May 31, 2025. The table below shows the threshold, target and maximum levels set by the Human Capital and Compensation Committee for each of these performance goals:

  75. Performance-based restricted stock

    | Performance goal | | Threshold (50%) | Target (100%) | Maximum (250%) | | 70% | Adjusted income from continuing operations (weighting) | $241.6M | $302.0 | $362.4M | | 20% | Three-year return on invested capital (weighting) | 7.52% | 8.40% | 10.08% | | 10% | Relative total shareholder return (weighting) | 25th Percentile | 50th Percentile | 80th Percentile |

  76. Performance-based restricted stock

    The performance-based restricted stock generally vests on July 31, 2025, subject to performance conditions. The Human Capital and Compensation Committee believes that performance-based restricted stock serves a valuable purpose aligning executive pay with the interests of stockholders. The Fiscal 2023 long-term incentive plan provides that: performance below the threshold level results in a 0% payout; performance at the threshold level results in a 50% payout of the shares of performance-based restricted stock; performance at the target level results in a 100% payout; and performance at or above the maximum level results in a 250% payout. Performance between the threshold and target levels and between the target and maximum levels results in proportionate straight-line payouts.

  77. Stock options

    Stock options The Human Capital and Compensation Committee approved the following grants of stock option awards for Fiscal 2023, subject to time-based vesting:

  78. Stock options

    | | Fiscal 2023 stock options | | | Named executive officer | Number of shares | Grant date fair value ($) | | John M. Holmes | 51,820 | 912,550 | | Sean M. Gillen | 12,065 | 212,465 | | Jessica A. Garascia | 7,100 | 125,031 | | Christopher A. Jessup | 12,065 | 212,465 | | Eric S. Pachapa | 5,715 | 100,641 |

  79. Stock options

    The grant date fair value in the table above was based on a Black-Scholes valuation, using the $41.88 closing price of the Common Stock on the July 18, 2022 date of grant. The stock options vest 33(1)/ 3 % on each of July 31, 2023, July 31, 2024 and July 31, 2025. The Human Capital and Compensation Committee believes that stock options serve a valuable purpose in helping to retain executives and reward them for building a career with the Company. Stock options, once vested, remain subject to the retention requirements under the Company’s stock ownership guidelines.

  80. Stock options

    | 54 | |

  81. Time-based restricted stock

    Time-based restricted stock The Human Capital and Compensation Committee approved the following grants of restricted stock awards for Fiscal 2023, subject to time-based vesting:

  82. Time-based restricted stock

    | | Fiscal 2023 restricted stock | | | Named executive officer | Number of shares | Grant date fair value ($) | | John M. Holmes | 21,785 | 912,356 | | Sean M. Gillen | 5,075 | 212,541 | | Jessica A. Garascia | 2,985 | 125,012 | | Christopher A. Jessup | 5,075 | 212,541 | | Eric S. Pachapa | 2,410 | 100,931 |

  83. Time-based restricted stock

    The grant date fair value in the table above was based on the $41.88 closing price of the Common Stock on the July 18, 2022 date of grant. The restricted stock vests 100% on July 31, 2025. The Human Capital and Compensation Committee believes that restricted stock serve a valuable purpose in helping to retain executives and reward them for building a career with the Company.

  84. Fiscal 2023 peer group

    Fiscal 2023 peer group The Human Capital and Compensation Committee believes that total compensation opportunities for the Company’s key executives, including the named executive officers, should be competitive with those offered by other companies competing for talent in the Company’s employment market. The goal of the Human Capital and Compensation Committee is to assemble a set of peer group companies that provide relevant pay and performance comparisons with the Company. The Committee and its independent compensation consultant recognize that any peer group of the Company will be imprecise given the Company’s unique characteristics, the diversity of its businesses and the diversity of the markets in which the Company operates. They further recognize that there will be larger-sized and smaller-sized companies in the Company’s peer group; companies that are competitors in some but not all of the Company’s businesses; and other financial, business or market attributes that the peer group companies may or may not share with the Company. When determining the Fiscal 2023 peer group, the Human Capital and Compensation Committee used the following criteria: company type; industry classification (using Standard and Poor’s GICS codes); companies of comparable size to the Company by annual revenue (with secondary consideration given to market value); and business focus (organizations that conducted business similar in nature to that conducted by the Company).

  85. Fiscal 2023 peer group

    | 2023 Proxy Statement | 55 |

  86. Fiscal 2023 peer group

    Following its review and analysis, the Human Capital and Compensation Committee recommended and the Board approved a Fiscal 2023 peer group consisting of the following 16 companies:

  87. Fiscal 2023 peer group

    | ●Aerojet Rocketdyne Holdings, Inc. ●Applied Industrial Technologies, Inc. ●Barnes Group, Inc. ●Crane Co. ●Curtiss-Wright Corporation ●Ducommun Incorporated | ●Heico Corporation ●Hexcel Corporation ●Kaman Corporation ●Moog Inc. ●MSC Industrial Direct Co., Inc. ●Spirit Aerosystems Holdings, Inc. | ●The Timken Company ●TriMas Corporation ●Triumph Group, Inc. ●Woodward, Inc. |

  88. Fiscal 2023 peer group

    The Fiscal 2023 peer group reflects the removal of CACI International Inc., Cubic Corporation and Teledyne Technologies, Inc. and the addition of Ducommun Incorporated and Spirit Aerosystems Holdings, Inc. The Human Capital and Compensation Committee noted the following reasons supporting its selection of the Fiscal 2023 peer group:

  89. Fiscal 2023 peer group

    | ● | The business and financial comparability of the peer group, on balance, to the Company; | | ● | The importance of year-to-year consistency in the comparisons of executive compensation; | | ● | The fact that eight of the 16 companies in the Company’s peer group were also listed as peer group companies by both ISS and Glass Lewis, which are large proxy advisory firms. |

  90. Employment, severance and other agreements

    Employment, severance and other agreements The Company has an employment agreement with Mr. Holmes, its President and Chief Executive Officer, and as of May 31, 2023, had severance and change-in-control agreements in place with the remainder of the named executive officers. See “— Employment agreement with Mr. Holmes” for a description of the employment agreement between the Company and Mr. Holmes and “Potential payments upon a termination of employment or a change-in-control of the Company” for a description of the severance and change-in-control agreements with the remainder of the named executive officers. The rationale for the employment agreement and the severance and change-in-control agreements is to provide an appropriate measure of security and incentive to the executive officers in line with market practice and to promote the Company’s goal of senior leadership stability. The Company has no tax gross-up provisions or single trigger change-in-control provisions in any agreement with any executive officer.

  91. Equity grant practices

    Equity grant practices The Human Capital and Compensation Committee meets from time to time to consider and act with respect to equity compensation awards for the Company’s executive officers. As described, the Committee typically grants annual stock awards at its July meeting. The Committee — or the Chief Executive Officer pursuant to authority delegated by the Committee — also grants stock awards to newly hired or newly promoted employees at other times during the year. The grant date is the date on which the Committee acts to approve the award, unless the Committee establishes the grant date at a specified future date, such as following the release of earnings or other potentially material non-public information. Board and Human Capital and Compensation Committee meetings are generally scheduled a year in advance and without regard to anticipated earnings or other major announcements by the Company. The Company does not time the granting of its equity compensation awards to affect the value of its executive compensation.

  92. Role of the independent compensation consultant

    Role of the independent compensation consultant Semler Brossy served as the independent compensation consultant to the Human Capital and Compensation Committee in Fiscal 2023. Semler Brossy provides research, data analysis, market information and compensation plan design expertise and experience to the Human Capital and Compensation Committee. Semler Brossy assisted with the design and implementation of the Fiscal 2023 short-term and long-term incentive plans for the Company’s senior executives and the development of the Company’s peer group for executive compensation purposes. Semler Brossy also kept the Committee apprised of regulatory developments and market trends related to executive compensation practices. Representatives of Semler Brossy attended all meetings of the Human Capital and Compensation Committee in Fiscal 2023.

  93. Role of the independent compensation consultant

    | 58 | |

  94. Role of the independent compensation consultant

    The Human Capital and Compensation Committee considered the independence of Semler Brossy in Fiscal 2023. The Human Capital and Compensation Committee’s consideration of Semler Brossy’s independence focused on the following factors:

  95. Role of the independent compensation consultant

    | ● | Semler Brossy provides no other services to the Company and received no other fees from the Company apart from its compensation for consulting with the Human Capital and Compensation Committee; | | ● | The conflicts of interest policies and procedures of the Company and of Semler Brossy; | | ● | The fact that the Semler Brossy employees who provided compensation consulting services did not own any shares of the Company’s common stock; | | ● | The lack of any relationships between Semler Brossy and members of the Company’s Board; and | | ● | The lack of any relationships between Semler Brossy and any of the Company’s executive officers. |

  96. Role of the independent compensation consultant

    Based on this assessment, the Human Capital and Compensation Committee concluded that no conflicts of interest existed with respect to Semler Brossy and that Semler Brossy was independent of the Company.

  97. Summary compensation table(1)

    Summary compensation table(1) The following table sets forth compensation information for our named executive officers for Fiscal 2023, Fiscal 2022 and Fiscal 2021:

  98. Summary compensation table(1)

    | Name and principal position | Year | Salary ($)(2) | Bonus ($) | Stock awards ($)(3) | Option awards ($)(4) | Non-equity incentive plan compensation ($)(5) | Change in pension value and non-qualified deferred compensation earnings ($)(6) | All other compensation ($)(7) | Total ($) | | John M. Holmes President and Chief Executive Officer | 2023 | 1,000,000 | — | 2,737,486 | 912,550 | 1,370,000 | 864 | 688,239 | 6,709,139 | | | 2022 | 925,000 | — | 8,302,428 | 326,652 | 1,554,000 | 827 | 1,218,436 | 12,327,343 | | | 2021 | 780,655 | — | — | 1,842,024 | 1,413,000 | 790 | 86,957 | 4,123,426 | | Sean M. Gillen Senior Vice President and Chief Financial Officer | 2023 | 480,000 | — | 637,623 | 212,465 | 657,600 | — | 165,573 | 2,153,261 | | | 2022 | 450,000 | — | 600,066 | 199,999 | 756,000 | — | 58,552 | 2,064,617 | | | 2021 | 392,845 | — | 172,543 | 402,527 | 682,950 | — | 24,151 | 1,675,016 | | Jessica A. Garascia Senior Vice President, General Counsel, Chief Administrative Officer and Secretary | 2023 | 430,000 | — | 375,036 | 125,031 | 589,100 | — | 137,961 | 1,657,128 | | | 2022 | 412,000 | — | 375,135 | 124,916 | 692,160 | — | 46,333 | 1,650,544 | | | 2021 | 359,598 | — | 250,008 | 250,021 | 628,000 | — | 27,913 | 1,515,540 | | Christopher A. Jessup Senior Vice President, Chief Commercial Officer | 2023 | 480,000 | — | 637,623 | 212,465 | 657,600 | — | 194,827 | 2,182,515 | | | 2022 | 450,000 | — | 801,088 | 102,532 | 756,000 | — | 86,331 | 2,195,951 | | | 2021 | 382,738 | — | 195,082 | 455,007 | 667,250 | — | 30,355 | 1,730,432 | | Eric S. Pachapa Vice President, Controller and Chief Accounting Officer | 2023 | 360,000 | — | 302,374 | 100,641 | 369,900 | — | 108,927 | 1,241,842 | | | 2022 | 345,000 | — | 375,103 | 65,380 | 434,700 | — | 43,020 | 1,263,203 | | | 2021 | 309,968 | — | 120,932 | 282,113 | 394,463 | — | 8,638 | 1,116,114 |

  99. Summary compensation table(1)

    | (1) General. The Summary Compensation Table provides specific compensation information for the Company’s named executive officers in accordance with applicable SEC rules. Please read the “Compensation discussion and analysis” section of this proxy statement for a more detailed explanation of the Company’s executive compensation program in Fiscal 2023. | | (2) Salary. In Fiscal 2023, each named executive officer received a base salary increase as follows: Mr. Holmes – 8%, Messrs. Gillen and Jessup – 7%, and Ms. Garascia and Mr. Pachapa – 4%, in each case for the reasons stated in the “Compensation discussion and analysis” section of the proxy statement. | | (3) Stock Awards. The amounts in this column for Fiscal 2023 reflect the grant date fair values of the time-based restricted stock awards as well as the value of performance-based restricted stock awards at their target levels. These values were computed in accordance with FASB ASC Topic 718 based on the fair market value of the underlying common stock on the date of grant. The grant date fair values of the performance-based stock awards, assuming the performance conditions are met at the maximum level as required by SEC rules, are as follows: Mr. Holmes: $1,825,130; Mr. Gillen: $425,082; Ms. Garascia: $250,024; Mr. Jessup: $425,082 and Mr. Pachapa: $201,443. In July 2022, the Human Capital and Compensation Committee made grants of time-based restricted stock awards and performance-based restricted stock awards pursuant to the Company’s Fiscal 2023 Long Term Incentive Compensation Program to each named executive officer. The time-based restricted stock generally vests on July 31, 2025. | | The grant date fair values represent the Company’s accounting expense for the grants made to the named executive officers in a given year. These amounts do not represent the actual value that may be realized by the named executive officers because an award may be forfeited or may not vest or may vest at a lower or higher level. The “Compensation Discussion and Analysis” section of this proxy statement contains additional information about the awards of performance-based restricted stock in Fiscal 2023. Vesting information is presented under “Executive Compensation — Outstanding Equity Awards at Fiscal 2023 Year End —Vesting.” | | (4) Option Awards. The amounts in this column for Fiscal 2023 reflect the grant date fair value of the stock option awards computed in accordance with FASB ASC Topic 718. In July 2022, the Human Capital and Compensation Committee made grants of stock options pursuant to the Company’s Fiscal 2023 Long Term Incentive Compensation Program to each named executive officer. The stock awards vest in 1/3 installments beginning on the first anniversary of the date of grant. See Note 5 to the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for Fiscal 2023 for an explanation of the assumptions made by the Company in the valuation of these awards. | | The grant date fair values represent the Company’s accounting expense for the grants of stock options made to the named executive officers in a given year. These amounts do not represent the actual value that may be realized by the named executive officers because a stock option may be forfeited, may not be exercised or may not vest. The “Compensation Discussion and Analysis” section of this proxy statement contains additional information about the awards of stock options granted in Fiscal 2023. Vesting information is presented under “Executive Compensation — Outstanding Equity Awards at Fiscal 2023 Year End — Vesting.” | | (5) Non-Equity Incentive Plan Compensation. The Fiscal 2023 amounts in this column are the performance-based cash bonuses earned by each of the named executive officers under the Company’s Fiscal 2023 short-term incentive plan. The “Compensation discussion and analysis” section of this proxy statement contains additional information about the Fiscal 2023 bonuses. | | (6) Change in Pension Value and Non-Qualified Deferred Compensation Earnings. This column shows the increased pension value under the Retirement Plan for Mr. Holmes, who is the only named executive officer with a benefit under the Retirement Plan. This column does not include any preferential or above-market earnings on deferred compensation as the Company does not pay such earnings on the deferred compensation of its named executive officers. |

  100. Summary compensation table(1)

    | 60 | |

  101. Summary compensation table(1)

    | (7) All Other Compensation. The table below provides a breakdown, by type and amount, of the totals shown in the “All Other Compensation” column for each named executive officer in Fiscal 2023. As required by the SEC rules, the Company values perquisites based on the aggregate incremental cost to the Company. From time to time, executive officers may use our tickets to sporting venues for personal use. We believe there is no incremental cost associated with our executive officers using our tickets to sporting venues for personal use because the tickets are purchased in advance for the entire season with the intention that they be used for business purposes, they cannot be returned for a refund if they are unused and use for personal purposes occurs only if the tickets have not been reserved for use for a business purpose. |

  102. Summary compensation table(1)

    | Named executive officer | Company 401(k) plan contributions ($) | Company SKERP contributions ($) | Perquisites and Other Personal Benefits* ($) | Total ($) | | John M. Holmes | 18,819 | 613,810 | 55,610 | 688,239 | | Sean M. Gillen | 12,581 | 135,123 | 17,869 | 165,573 | | Jessica A. Garascia | 9,378 | 113,434 | 15,149 | 137,961 | | Christopher A. Jessup | 18,681 | 152,931 | 23,215 | 194,827 | | Eric S. Pachapa | 16,203 | 88,429 | 4,295 | 108,927 |

  103. Summary compensation table(1)

    | * Amounts include club dues and expenses, financial planning, executive physicals and travel related benefits, including spousal travel, each of which was provided to one or more of our NEOs. The cost of any category of the listed perquisites and other personal benefits did not exceed the greater of $25,000 or 10% of total perquisites and other personal benefits for any NEO, except $30,753 for club dues and expenses for Mr. Holmes. |

  104. Fiscal 2023 grants of plan-based awards

    Fiscal 2023 grants of plan-based awards The following table sets forth information for each named executive officer with respect to:

  105. Fiscal 2023 grants of plan-based awards

    | ● | Estimated possible payouts under non-equity incentive plan award opportunities for Fiscal 2023; | | ● | Estimated future payouts under equity incentive plan award opportunities for Fiscal 2023; | | ● | Other stock awards made in Fiscal 2023; and | | ● | Stock options granted in Fiscal 2023. |

  106. Fiscal 2023 grants of plan-based awards

    | | | Estimated possible payouts under non-equity incentive plan awards(2) | | | Estimated future payouts under equity incentive plan awards(3) | | | All other stock awards: number of shares of stock or units (#)(4) | All other option awards: number of securities underlying options (#)(5) | Exercise or base price of option awards ($/sh) | Grant date fair value of stock and option awards ($)(6) | | Named executive officer | Grant date(1) | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | John M. Holmes | | 500,000 | 1,000,000 | 2,000,000 | | | | | | | | | | 7/18/22 | | | | | | | 21,785 | | | 912,356 | | | 7/18/22 | | | | 21,790 | 43,580 | 108,950 | | | | 1,825,130 | | | 7/18/22 | | | | | | | | 51,820 | 41.88 | 912,550 | | Sean M. Gillen | | 240,000 | 480,000 | 960,000 | | | | | | | | | | 7/18/22 | | | | | | | 5,075 | | | 212,541 | | | 7/18/22 | | | | 5,075 | 10,150 | 25,375 | | | | 425,082 | | | 7/18/22 | | | | | | | | 12,065 | 41.88 | 212,465 | | Jessica A. Garascia | | 215,000 | 430,000 | 860,000 | | | | | | | | | | 7/18/22 | | | | | | | 2,985 | | | 125,012 | | | 7/18/22 | | | | 2,985 | 5,970 | 14,925 | | | | 250,024 | | | 7/18/22 | | | | | | | | 7,100 | 41.88 | 125,031 | | Christopher A. Jessup | | 240,000 | 480,000 | 960,000 | | | | | | | | | | 7/18/22 | | | | | | | 5,075 | | | 212,541 | | | 7/18/22 | | | | 5,075 | 10,150 | 25,375 | | | | 425,082 | | | 7/18/22 | | | | | | | | 12,065 | 41.88 | 212,465 | | Eric. S. Pachapa | | 135,000 | 270,000 | 540,000 | | | | | | | | | | 7/18/22 | | | | | | | 2,410 | | | 100,931 | | | 7/18/22 | | | | 2,405 | 4,810 | 12,025 | | | | 201,443 | | | 7/18/22 | | | | | | | | 5,715 | 41.88 | 100,641 |

  107. Fiscal 2023 grants of plan-based awards

    | (1) The Human Capital and Compensation Committee granted annual stock awards under the Company’s Fiscal 2023 long-term incentive plan at its meeting on July 18, 2022. | | (2) Annual cash bonuses under the Company’s Fiscal 2023 short-term incentive plan were subject to performance in Fiscal 2023, which has now occurred. The information in these columns reflects the range of potential payouts at the time the performance goals were set by the Human Capital and Compensation Committee at its meeting on July 18, 2022 and based on salary increases for Fiscal 2023 that were effective as of June 1, 2022. | | (3) The information in these columns shows the range of performance-based restricted stock grants that could be earned by the named executive officers under the Fiscal 2023 long-term incentive plan. The actual number of shares of performance-based restricted stock granted under the Fiscal 2023 long-term incentive plan is listed in the “Target” column. See the “Compensation discussion and analysis” section of this proxy statement for a description of the performance-based restricted stock awards under the Fiscal 2023 long-term incentive plan. | | (4) This column shows the number of shares of time-based restricted stock granted to the named executive officers under the Company’s Fiscal 2023 long-term incentive plan on July 18, 2022. | | (5) This column shows the number of shares subject to stock options granted to the named executive officers under the Company’s Fiscal 2023 long-term incentive plan on July 18, 2022. | | (6) The grant date fair values of the restricted stock awards and the stock option awards were computed in accordance with FASB ASC Topic 718. |

  108. Fiscal 2023 grants of plan-based awards

    | 62 | |

  109. Outstanding equity awards at Fiscal 2023 year-end

    Outstanding equity awards at Fiscal 2023 year-end The following table sets forth information for each named executive officer with respect to:

  110. Outstanding equity awards at Fiscal 2023 year-end

    | ● | Each stock option that remained outstanding as of May 31, 2023; and | | ● | Each award of restricted stock that was not vested and remained outstanding as of May 31, 2023. |

  111. Outstanding equity awards at Fiscal 2023 year-end

    | | Option awards(1) | | | | | Stock awards | | | | | Named executive officer | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Equity incentive plan awards: number of securities underlying unexercised unearned options (#) | Option exercise price ($) | Option expiration date | Number of shares or units of stock that have not vested (#)(2) | Market value of shares or units of stock that have not vested ($)(3) | Equity incentive plan awards: number of unearned shares, units, or other rights that have not vested (#)(4) | Equity incentive plan awards: market or payout value of unearned shares, units or other rights that have not vested ($)(5) | | John M. Holmes | 96,000 | — | — | 35.26 | 07/10/27 | 174,430 | 8,740,687 | 60,540 | 3,033,659 | | | 82,300 | — | — | 48.09 | 07/09/28 | — | — | — | | | | 126,225 | — | — | 37.66 | 07/08/29 | — | — | — | — | | | 30,732 | 108,868 | — | 18.94 | 07/13/30 | — | — | — | — | | | 7,983 | 15,967 | — | 37.74 | 07/12/31 | — | — | — | — | | | 104 | 208 | — | 50.93 | 03/25/32 | — | — | — | — | | | — | 51,820 | — | 41.88 | 07/18/32 | — | — | — | — | | Sean M. Gillen | 11,385 | — | — | 37.66 | 07/08/29 | 19,485 | 976,393 | 20,750 | 1,039,783 | | | 38,080 | 23,790 | — | 18.94 | 07/13/30 | — | — | — | — | | | 4,990 | 9,980 | — | 37.74 | 07/12/31 | — | — | — | — | | | — | 12,065 | — | 41.88 | 07/18/32 | — | — | — | — | | Jessica A. Garascia | — | 14,778 | — | 18.94 | 07/13/30 | 6,295 | 315,442 | 12,600 | 631,386 | | | 3,116 | 6,234 | — | 37.74 | 07/12/31 | — | — | — | — | | | — | 7,100 | — | 41.88 | 07/18/32 | — | — | — | — | | Christopher A. Jessup | 18,300 | — | — | 48.09 | 07/09/28 | 27,819 | 1,394,010 | 15,520 | 777,707 | | | 24,250 | — | — | 37.66 | 07/08/29 | — | — | — | — | | | — | 26,893 | — | 18.94 | 07/13/30 | — | — | — | — | | | 2,526 | 5,054 | — | 37.74 | 07/12/31 | — | — | — | — | | | 19 | 40 | — | 50.93 | 03/25/32 | — | — | — | — | | | — | 12,065 | — | 41.88 | 07/18/32 | — | — | — | — | | Eric S. Pachapa | 9,150 | — | — | 48.09 | 07/09/28 | 14,049 | 703,995 | 8,260 | 413,909 | | | 2,846 | 16,674 | — | 18.94 | 07/13/30 | — | — | — | — | | | — | 3,240 | — | 37.74 | 07/12/31 | — | — | — | — | | | 7 | 14 | — | 50.93 | 03/25/32 | — | — | — | — | | | — | 5,715 | — | 41.88 | 07/18/32 | — | — | — | — |

  112. Outstanding equity awards at Fiscal 2023 year-end

    | (1) These columns show the number, option exercise price and option expiration date of outstanding stock options held by the named executive officers at the end of Fiscal 2023. The first column shows this information for exercisable stock options, and the second column shows this information for unexercisable stock options. | | The table below shows the vesting dates for these unexercisable options. |

  113. Outstanding equity awards at Fiscal 2023 year-end

    | Vesting date | Mr. Holmes | Mr. Gillen | Ms. Garascia | Mr. Jessup | Mr. Pachapa | | 07/31/23 | 134,124 | 32,801 | 20,260 | 33,440 | 20,199 | | 03/25/24 | 104 | — | — | 19 | 7 | | 07/31/24 | 25,257 | 9,011 | 5,484 | 6,549 | 3,525 | | 03/25/25 | 104 | — | — | 21 | 7 | | 07/31/25 | 17,274 | 4,023 | 2,368 | 4,023 | 1,905 |

  114. Outstanding equity awards at Fiscal 2023 year-end

    | 2023 Proxy Statement | 63 |

  115. Outstanding equity awards at Fiscal 2023 year-end

    | (2) This column shows the number of unvested shares of time-based restricted stock held by the named executive officers at the end of Fiscal 2023. The table below shows the vesting dates for these unvested shares. |

  116. Outstanding equity awards at Fiscal 2023 year-end

    | Vesting date | Mr. Holmes | Mr. Gillen | Ms. Garascia | Mr. Jessup | Mr. Pachapa | | 07/31/23 | — | 9,110 | — | 10,300 | 6,385 | | 07/31/24 | 8,480 | 5,300 | 3,310 | 2,680 | 1,720 | | 03/25/25 | 144,165 | — | — | 9,764 | 3,534 | | 07/31/25 | 21,785 | 5,075 | 2,985 | 5,075 | 2,410 |

  117. Outstanding equity awards at Fiscal 2023 year-end

    | (3) This column shows the market value of the unvested shares of time-based restricted stock held by the named executive officers based on a price of $50.11 per share (the closing price of the common stock on May 31, 2023). | | (4) This column shows the number of unvested shares of performance-based restricted stock at the target level held by the named executive officers at the end of Fiscal 2023. The table below shows the vesting dates for these unvested shares: |

  118. Outstanding equity awards at Fiscal 2023 year-end

    | Vesting date | Mr. Holmes | Mr. Gillen | Ms. Garascia | Mr. Jessup | Mr. Pachapa | | 07/31/24 | 16,960 | 10,600 | 6,630 | 5,370 | 3,450 | | 07/31/25 | 43,580 | 10,150 | 5,970 | 10,150 | 4,810 |

  119. Outstanding equity awards at Fiscal 2023 year-end

    | (5) This column shows the market value of the unvested shares of performance-based restricted stock at the target level held by the named executive officers based on a price of $50.11 per share (the closing price of the common stock on May 31, 2023). |

  120. Fiscal 2023 option exercises and stock vested

    Fiscal 2023 option exercises and stock vested The following table sets forth information for each named executive officer concerning:

  121. Fiscal 2023 option exercises and stock vested

    | ● | The exercise of options during Fiscal 2023; | | ● | The dollar amount realized on exercise of the options; | | ● | The number of shares of restricted stock that vested during Fiscal 2023; and | | ● | The value of those vested shares. |

  122. Fiscal 2023 option exercises and stock vested

    | | Option awards | | Stock awards | | | Named executive officer | Number of shares acquired on exercise (#) | Value realized on exercise(1) ($) | Number of shares acquired on vesting (#) | Value realized on vesting(2) ($) | | John M. Holmes | 197,000 | 5,632,987 | 12,084 | 538,101 | | Sean M. Gillen | 26,250 | 542,547 | 2,328 | 103,666 | | Jessica A. Garascia | 29,552 | 902,409 | — | — | | Christopher A. Jessup | 36,225 | 1,155,346 | 2,328 | 103,666 | | Eric S. Pachapa | 32,970 | 800,060 | 1,628 | 72,495 |

  123. Fiscal 2023 option exercises and stock vested

    | (1) These amounts represent the difference between the closing market price of the common stock on the date of exercise and the exercise price, multiplied by the number of shares covered by the option. | | (2) These amounts represent the closing market price of the common stock on the date of vesting, multiplied by the number of shares that vested. |

  124. Payment of retirement benefits

    Payment of retirement benefits Participants can elect to receive their benefits upon termination of employment or they can defer receipt of benefits until normal retirement age (age 65). Any vested participant can elect benefits at any time after termination of employment, with the benefit actuarially reduced to reflect payment prior to age 65. The normal form of benefit payment for a married participant is a joint and 50% survivor annuity, and the normal form of benefit payment for an unmarried participant is a single life annuity. Participants, with spousal consent, if applicable, can waive the normal form of benefit payment and elect to have benefits paid in various annuity forms, which are the actuarial equivalent of the normal form, or in a lump sum. In connection with the termination of the plan, participants who were not in pay status (including actives) were allowed to take a lump sum payment. Those who elected the lump sum were paid in July 2023. All participants who are still owed a benefit from the plan will have an annuity contract purchased on their behalf in August 2023.

  125. Fiscal 2023 pension benefits

    Fiscal 2023 pension benefits

  126. Fiscal 2023 pension benefits

    | Named executive officer | Plan Name | Number of years credited service (#)(1) | Present value of accumulated benefit ($)(2) | Payments during Fiscal 2023 ($) | | John M. Holmes | Retirement Plan | 3.7 | 19,912 | — |

  127. Fiscal 2023 pension benefits

    | (1) Number of Years of Credited Service as of May 31, 2005, the date the Retirement Plan was frozen. | | (2) Amounts shown in this column are calculated as of the last business day of Fiscal 2023, which is the measurement date for reporting purposes in the Company’s Annual Report on Form 10-K for Fiscal 2023. See Note 8 to the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for an explanation of the assumptions made by the Company in determining the amounts reported in this column. |

  128. Non-qualified deferred compensation (SKERP)

    Non-qualified deferred compensation (SKERP) The Company provides non-qualified deferred compensation benefits under the Company’s SKERP. The SKERP covers certain executives and key employees designated by the Human Capital and Compensation Committee. All of the named executive officers participated in the SKERP in Fiscal 2023. The material terms and conditions of the SKERP include the following.

  129. Fiscal 2023 non-qualified deferred compensation

    Fiscal 2023 non-qualified deferred compensation

  130. Fiscal 2023 non-qualified deferred compensation

    | Named executive officer | Executive contributions in Fiscal 2023 ($)(1) | Company contributions in Fiscal 2023 ($)(2) | Aggregate earnings in Fiscal 2023 ($)(3) | Aggregate withdrawal/ distributions ($) | Aggregate balance at May 31, 2023 ($)(4) | | John M. Holmes | 321,792 | 613,810 | 24,353 | — | 4,927,408 | | Sean M. Gillen | 57,808 | 135,123 | 13,647 | — | 432,698 | | Jessica A. Garascia | 48,885 | 113,434 | 10,284 | — | 234,449 | | Christopher A. Jessup | 57,808 | 152,931 | 9,244 | — | 497,800 | | Eric S. Pachapa | 37,406 | 88,429 | 7,035 | — | 254,101 |

  131. Fiscal 2023 non-qualified deferred compensation

    | (1) The amount of contributions made by each named executive officer and reported in this column in respect of salary deferrals in Fiscal 2023 is included in each named executive officer’s compensation reported in the Summary Compensation Table as Salary. The amount of contributions reported in this column also reflects deferral of cash bonuses paid in Fiscal 2023 but earned and reported on the Summary Compensation Table for Fiscal 2022. | | (2) The amount of Company contributions reported in this column for each named executive officer is reported in the “All Other Compensation” column in the Summary Compensation Table. | | (3) The investment earnings reported in this column for each named executive officer are not reported in the Summary Compensation Table. | | (4) The aggregate balance as of May 31, 2023 reported in this column for each named executive officer reflects amounts that have been previously reported as compensation in the Summary Compensation Table for Fiscal 2023 or prior years, except the following amounts of earnings included in the account balance: Mr. Holmes – $1,662,145, Mr. Gillen – $29,826, Ms. Garascia – $4,842, Mr. Jessup – $37,097, and Mr. Pachapa – $12,665. |

  132. Fiscal 2023 non-qualified deferred compensation

    | 2023 Proxy Statement | 67 |

  133. Potential payments upon a termination of employment or a change-in-control of the Company

    Potential payments upon a termination of employment or a change-in-control of the Company The Company provides certain benefits to eligible employees upon certain types of termination of employment, including a termination of employment involving a change-in-control of the Company. These benefits are in addition to the benefits to which the employees would be entitled upon a termination of employment generally (i.e., vested retirement benefits accrued as of the date of termination, stock options and restricted stock that are otherwise vested as of the date of termination and the right to elect continued health coverage pursuant to COBRA). These benefits as they pertain to the named executive officers are as described and set forth in the tables beginning on page 75.

  134. Potential payments upon a termination of employment or a change-in-control of the Company

    | 68 | |

  135. Tables of potential payments upon a termination of employment or a change-in-control of the Company

    Tables of potential payments upon a termination of employment or a change-in-control of the Company The tables below quantify the benefits described above that would be paid to each current named executive officer under the following termination of employment or change-in-control events, assuming a change-in-control or a termination of employment occurred on May 31, 2023.

  136. CEO pay ratio

    CEO pay ratio A public company must disclose in its annual proxy statement its CEO pay ratio, defined as the ratio of the annual total compensation of its chief executive officer to the annual total compensation of its median employee. Our median employee is selected once every three years unless there has been a change in our employee population or employee compensation arrangements that would result in a significant change to our pay ratio disclosure. For Fiscal 2023, we used the same median employee identified in Fiscal 2021 because we believe that there have been no changes in our employee population or employee compensation arrangements in Fiscal 2023 that would result in a significant change to the pay ratio disclosure. We used the following methodology to determine our CEO pay ratio for Fiscal 2023, Fiscal 2022 and Fiscal 2021:

  137. CEO pay ratio

    | STEP 1: | We determined that as of March 1, 2021 we had a total employee population of 4,762 employees. | | STEP 2: | Of this group, we identified a selected employee group of 4,572 employees, representing all of our U.S. employees (3,812) plus our employees in Canada (503), the United Kingdom (166) and the Netherlands (91). | | STEP 3: | As permitted by SEC rules, we excluded our employees in all other non-U.S. jurisdictions as these employees together represented less than 5% of our total employee population. The number of employees excluded in non-U.S. jurisdictions at the March 1, 2021 determination date were: Afghanistan (33), Australia (3), Belgium (15), Brazil (1), China (7), Costa Rica (14), France (6), Germany (8), Guatemala (7), Hungary (1), India (1), Ireland (1), Japan (1), Malaysia (6), Mexico (1), New Zealand (2), Panama (20), Peru (34), Singapore (24), and United Arab Emirates (5). | | STEP 4: | For our selected employee group, we determined each domestic employee’s total cash compensation based on W-2 (Box 5) compensation (or its equivalent for non-U.S. employees) for the 2020 calendar year, as reflected in our payroll records and systems. | | STEP 5: | We identified our median employee from our selected employee group (excluding the Chief Executive Officer). | | STEP 6: | Once we identified our median employee, we calculated the annual total compensation of this median employee for Fiscal 2023, using the same methodology that we used to calculate the annual total compensation of our named executive officers, including our Chief Executive Officer, in the Summary Compensation Table. |

  138. CEO pay ratio

    The following table shows the ratio of the annual total compensation of our Chief Executive Officer compared to that of our median employee for Fiscal 2023:

  139. CEO pay ratio

    | Annual total compensation of our CEO for Fiscal 2023 | $6,709,139 | | Annual total compensation of our median employee for Fiscal 2023 | $71,129 | | Ratio of annual total compensation of our CEO to the annual total compensation of our median employee for Fiscal 2023 | 94 to 1 |

  140. CEO pay ratio

    | 2023 Proxy Statement | 73 |

  141. Pay versus performance disclosure

    Pay versus performance disclosure The following table sets forth additional compensation information of our Principal Executive Officer (PEO) and our non-PEO NEOs along with total shareholder return, net income, and Adjusted Diluted Earnings per Share from Continuing Operations performance results for our fiscal years ended May 31, 2023, 2022 and 2021:

  142. Pay versus performance disclosure

    | | | | | | Value of Initial Fixed $100 Investment Based On:(7) | | | | | Year(1) | Summary Compensation Table Total for PEO ($) | Compensation Actually Paid to PEO2, 3 ($) | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs2, 3 ($) | Company Total Shareholder Return | Peer Group Total Shareholder Return | Net Income ($) | Adjusted Diluted Earnings per Share from Continuing Operations ($)(8) | | 2023(4) | 6,709,139 | 10,703,256 | 1,808,687 | 2,732,276 | 248.44 | 160.37 | 90,200,000 | 2.86 | | 2022(5) | 12,327,343 | 13,416,164 | 1,793,579 | 2,238,871 | 239.07 | 146.58 | 78,700,000 | 2.38 | | 2021(6) | 4,123,426 | 12,752,734 | 1,509,276 | 3,211,723 | 206.99 | 161.40 | 35,800,000 | 1.31 |

  143. Pay versus performance disclosure

    | (1) For each year presented above, the NEOs included in the compensation columns reflect John M. Holmes as our PEO and Sean M. Gillen, Jessica A. Garascia, Christopher A. Jessup, and Eric S. Pachapa as our non-PEOs. |

  144. Pay versus performance disclosure

    | (2) Fair value or change in fair value, as applicable, of equity awards in the “Actually Paid” columns was determined by reference to (1) for time-based restricted stock awards, closing price on applicable year-end date(s) or, in the case of vesting dates, the actual vesting price, (2) for performance-based restricted stock awards, the estimated payout used to recognize our expense in accordance with FASB ASC Topic 718 except using the closing price on applicable year-end date(s) or, in the case of vesting dates, the actual vesting price, and (3) for stock options, a Black-Scholes fair value as of the applicable year-end or vesting date(s), determined based on the same methodology as used to determine grant date fair value but using the closing stock price on the applicable revaluation date as the current market price and with an expected life equal to the original ratio of expected life relative to the ten year contractual life multiplied times the remaining life as of the applicable revaluation date, and in all cases based on updated volatility, risk free rates, and expected dividend rates determined as of the revaluation dates. | | (3) For the portion of “Actually Paid” compensation that is based on year-end stock prices, the following prices were used: 2023 – $50.11 (3.9% increase from prior year), 2022 – $48.22 (15.5% increase from prior year), and 2021 – $41.75 (107.0% increase from prior year). |

  145. Pay versus performance disclosure

    | (4) 2023 compensation “Actually Paid” to PEO and the average Actually Paid to non-PEOs reflects the following adjustments from Total compensation reported in the Summary Compensation Table: |

  146. Pay versus performance disclosure

    | | PEO ($) | Average Non-PEO ($) | | Total Reported in 2023 Summary Compensation Table (SCT) | 6,709,139 | 1,808,687 | | Less, value of stock awards and option awards reported in SCT | (3,650,036) | (650,825) | | Plus, year-end value of awards granted in fiscal year that are unvested and outstanding | 6,255,805 | 1,115,398 | | Plus, change in fair value of prior year awards that are outstanding and unvested | 1,775,875 | 537,650 | | Plus, change in fair value (from prior year-end) of prior year awards that vested this year | (387,527) | (78,634) | | Total adjustments | 3,994,117 | 923,589 | | Actual compensation paid for Fiscal 2023 | 10,703,256 | 2,732,276 |

  147. Pay versus performance disclosure

    | (5) 2022 compensation “Actually Paid” to PEO and the average Actually Paid to non-PEOs reflects the following adjustments from Total compensation reported in the Summary Compensation Table: |

  148. Pay versus performance disclosure

    | | PEO ($) | Average Non-PEO ($) | | Total Reported in 2022 Summary Compensation Table (SCT) | 12,327,343 | 1,793,579 | | Less, value of stock awards and option awards reported in SCT | (8,629,080) | (661,055) | | Plus, year-end value of awards granted in fiscal year that are unvested and outstanding | 8,760,652 | 852,676 | | Plus, change in fair value of prior year awards that are outstanding and unvested | 1,923,314 | 406,267 | | Plus, change in fair value (from prior year-end) of prior year awards that vested this year | (966,065) | (152,596) | | Total adjustments | 1,088,821 | 445,291 | | Actual compensation paid for Fiscal 2023 | 13,416,164 | 2,238,871 |

  149. Pay versus performance disclosure

    | 74 | |

  150. Pay versus performance disclosure

    | (6) 2021 compensation “Actually Paid” to PEO and the average Actually Paid to non-PEOs reflects the following adjustments from Total compensation reported in the Summary Compensation Table: |

  151. Pay versus performance disclosure

    | | PEO ($) | Average Non-PEO ($) | | Total Reported in 2021 Summary Compensation Table (SCT) | 4,123,426 | 1,509,276 | | Less, value of stock awards and option awards reported in SCT | (1,842,024) | (532,058) | | Plus, year-end value of awards granted in fiscal year that are unvested and outstanding | 8,060,488 | 1,789,492 | | Plus, change in fair value of prior year awards that are outstanding and unvested | 2,635,391 | 331,115 | | Plus, fair market value of awards granted this year and that vested this year | — | 119,526 | | Plus, change in fair value (from prior year-end) of prior year awards that vested this year | (224,547) | (5,628) | | Total adjustments | 8,629,308 | 1,702,447 | | Actual compensation paid for Fiscal 2023 | 12,752,734 | 3,211,723 |

  152. Pay versus performance disclosure

    | (7) Each year reflects what the cumulative value of $100 would be, including reinvestment of dividends, if such amount were invested on June 1, 2020. Peer group TSR reflects the Company’s “2023 peer group” as reflected in our 2023 Annual Report on Form 10-K pursuant to Item 201(e) of Regulation S-K and “Fiscal 2023 peer group” in this proxy statement. |

  153. Pay versus performance disclosure

    | (8) Adjusted diluted earnings per share from continuing operations, a non-GAAP financial measure, is our GAAP diluted earnings per share from continuing operations adjusted to exclude items of an unusual nature including but not limited to business divestitures, workforce actions, subsidies and costs, impairment and exit charges, facility consolidation and repositioning costs, investigation and remediation compliance costs, purchase accounting and legal settlements, strategic project costs, equity investments gains and losses, and significant customer events such as early terminations, contract restructurings, forward loss provisions and bankruptcies. We use this non-GAAP financial measure in our compensation structure as it illustrates our core operating performance unaffected by the impact of certain items that management does not believe are indicative of our ongoing and core operating activities. |

  154. Pay versus performance disclosure

    Required supplemental graphs showing relationship between:

  155. Compensation actually paid (CAP) and Company total shareholder return (TSR)

    Compensation actually paid (CAP) and Company total shareholder return (TSR) The graph below illustrates the relationship between the CAP to our CEO and the other NEOs and the Company’s TSR during the period covered under the “Pay versus performance disclosure” above. The CAP figures shown below are calculated as required by SEC requirements, which include unvested and unpaid amounts. Each year of Company TSR reflects what the cumulative value of $100 would be, including reinvestment of dividends, if such amount were invested on June 1, 2020. As shown in the “Pay versus performance disclosure“ above and below on page 77 in the Company TSR vs. Peer Group TSR graph, the value of $100 invested in the Peer Group on June 1, 2020 would be $161.40 at the end of Fiscal 2021, $146.58 at the end of Fiscal 2022 and $160.37 at the end of Fiscal 2023.

  156. Compensation Actually Paid vs. Company TSR

    Compensation Actually Paid vs. Company TSR

  157. Compensation Actually Paid vs. Company TSR

    | 2023 Proxy Statement | 75 |

  158. Compensation actually paid (CAP) and net income

    Compensation actually paid (CAP) and net income The graph below illustrates the relationship between the CAP to our CEO and the other NEOs and the Company’s net income during the period covered under the “Pay versus performance disclosure” above. The CAP figures shown below are calculated as required by SEC requirements, which include unvested and unpaid amounts.

  159. Compensation Actually Paid vs. Net Income

    Compensation Actually Paid vs. Net Income

  160. Compensation actually paid (CAP) and adjusted diluted earnings per share from continuing operations

    Compensation actually paid (CAP) and adjusted diluted earnings per share from continuing operations The graph below illustrates the relationship between the CAP to our CEO and the other NEOs and the Company’s adjusted diluted earnings per share from continuing operations during the period covered under the “Pay versus performance disclosure” above. The CAP figures shown below are calculated as required by SEC requirements, which include unvested and unpaid amounts.

  161. Compensation Actually Paid vs. Adjusted Diluted Earnings per Share from Continuing Operations

    Compensation Actually Paid vs. Adjusted Diluted Earnings per Share from Continuing Operations

  162. Compensation Actually Paid vs. Adjusted Diluted Earnings per Share from Continuing Operations

    | 76 | |