PROPOSAL 1: ELECTION OF DIRECTORS
The Board is elected annually by shareholders to oversee the long-term health, overall success, and financial strength of the Company’s business. The Corporate Governance and Nomination Committee is responsible for considering candidates for the Board and recommending director nominees for the Board.
Our Board of Directors believes that its overriding responsibility is to offer guidance and the benefit of its collective experience to help our management understand the risks confronting, and opportunities available to our Company. In furtherance of this responsibility, our Board of Directors has adopted a General Corporate Governance Policy setting forth certain policies, guidelines, and procedures it deems important to the successful satisfaction of this responsibility.
These policies and procedures include guidelines as to the eligibility, independence, evaluation, education, succession planning, compensation, and indemnification of our directors, as well as with respect to specific transactions requiring the prior formal approval of our Board of Directors. A copy of our General Corporate Governance Policy is posted on the Investor Relations section of the Company’s website at investors.cmco.com.
NEW BOARD DEVELOPMENTS
Mr. Gerald Colella was appointed Chairman of the Board effective April 1, 2023. He joined the Columbus McKinnon Board of Directors in November 2021.
Ms. Kathryn Roedel was appointed as Lead Director effective April 1, 2023. She will serve as a key advisor and support the Chairman of the Board. She joined the Columbus McKinnon Board of Directors in October 2017.
Mr. Richard Fleming retired from the Board of Directors at the end of his term at the Annual Meeting of Shareholders on July 24, 2023. The Board and Management thank Mr. Fleming for his twenty-four (24) years of dedicated service on behalf of the Company.
Mr. Heath Mitts stepped down from the Board of Directors for personal reasons effective January 31, 2024. The Board and Management thank Mr. Mitts for his nine (9) years of dedicated service on behalf of the Company.
Mr. Chris Stephens Jr. was appointed to the Board of Directors in March 2024. He serves as a Member of the Audit Committee and Human Capital, Compensation and Succession Committee.
Mr. Aziz Aghili is retiring from his position as EVP of Dana and President of Dana’s Commercial Vehicle Drive and Motion Systems (NYSE:DAN) on June 30, 2024.
The Company’s committee leadership has also been refreshed. The new leaders are:
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Ms. Jeanne Beliveau-Dunn, Chair of the Human Capital, Compensation & Succession Committee |
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Mr. Aziz Aghili, Chair of the Corporate Governance and Nomination Committee |
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Mr. Michael Dastoor, Chair of the Audit Committee. |
ELECTION OF DIRECTORS
The Board, upon recommendation of its Corporate Governance and Nomination Committee, has nominated each of the directors named for election at the Annual Meeting. Such individuals were selected based on their broad experience, wisdom, integrity, alignment with our values, understanding of the business environment, through appreciation for strong ethics and appropriate governance and their willingness to devote adequate time to their Board duties. The experience, qualifications, attributes, and
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2024 PROXY STATEMENT |
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PROPOSAL 4: APPROVE OF COLUMBUS MCKINNON CORPORATION SECOND AMENDED AND RESTATED 2016 LONG TERM INCENTIVE PLAN
Approval of the Second Amended and Restated 2016 Long Term Incentive Plan
We are asking our shareholders to approve a second amendment and restatement of the Columbus McKinnon Corporation 2016 Long Term Incentive Plan (the “2016 Plan”). Upon recommendation of the Compensation Committee, the Board approved the second amended and restated 2016 Plan on June 4, 2024, subject to receipt of shareholder approval, and has recommended that shareholders approve this Proposal 4 to approve the second amended and restated 2016 Plan. The second amended and restated 2016 Plan, among other clarifying and administrative changes, increases the maximum number of shares that may be issued as awards under the 2016 Plan by 2,800,000 shares in order to provide sufficient available capacity to permit the Company to continue to grant equity awards to its directors, officers, employees, and third-party service providers. The Compensation Committee believes that long-term incentives provide important medium-term and long-term incentives for our directors, officers, employees, and third-party service providers to achieve the Company’s strategic business plan. The Compensation Committee also believes that long-term incentives consistent with those available to other leading industrial companies are required for us to compete for, motivate, and retain high-quality directors, executives, employees, and third-party service providers.
Background
The 2016 Plan was originally adopted by our Board and approved by our shareholders on July 18, 2016. The 2016 Plan was then amended and restated effective June 5, 2019, for which shareholder approval was obtained on July 22, 2019, to, among other items, increase the number of shares authorized for use in making awards under the 2016 Plan by an additional 2,500,000 shares.
Changes to the 2016 Plan
We are asking our shareholders to approve a second amendment and restatement of the 2016 Plan, which (along with certain other clarifying and administrative changes) increases the number of shares authorized for use in making awards under the 2016 Plan by an additional 2,800,000 shares. These additional 2,800,000 shares, when combined with the 339,019 shares remaining available for grant under the 2016 Plan as of March 31, 2024, will result in 3,139,019 shares being available for grant under the 2016 Plan if the second amended and restated 2016 Plan is approved.
The other clarifying and administrative changes being made to the second amended and restated 2016 Plan include:
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Extending the duration of the 2016 Plan such that it will now terminate on June 4, 2034, which is the tenth anniversary of the effective date of the second amendment and restatement of the 2016 Plan; |
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Extending the period during which the Company may grant incentive stock options (“ISOs”) under the 2016 Plan until June 4, 2034, which is the tenth anniversary of the effective date of the second amendment and restatement of the 2016 Plan; |
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Adding a provision whereby the option exercise price for any ISOs granted under the 2016 Plan to any Ten-Percent shareholders (as defined in the 2016 Plan) must be equal to at least 110% of the fair market value of a share of the Company’s common stock and any such ISOs must be exercisable not later than the fifth anniversary of the grant date thereof; |
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2024 PROXY STATEMENT |
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31 |
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PROPOSAL 4: APPROVE OF COLUMBUS MCKINNON CORPORATION SECOND AMENDED AND RESTATED 2016 LONG TERM INCENTIVE PLAN
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Expanding the list of possible performance measures to be used with respect to incentive awards issued under the 2016 Plan to include strategic goals and objectives, including objectives related to qualitative or quantitative environmental, social and governance metrics; and |
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Including additional Code Section 409A compliance provisions to the 2016 Plan. |
Current Overview of Available Equity Awards
As of March 31, 2024, the Company had 339,019 shares available for grant under the amended and restated 2016 Plan, a number that both the Compensation Committee and the Board believe to be insufficient to meet our anticipated needs for the remainder of 2024 and beyond. The Board believes that it is desirable and necessary to increase the number of shares available for issuance under the 2016 Plan so that the Company can continue to fulfill our compensation philosophy goals of competing for, motivating, and retaining high-quality directors, executives, employees, and third-party service providers and linking their interests with those of our shareholders. If the second amended and restated 2016 Plan is not approved by our shareholders, the amended and restated 2016 Plan will remain in place, but the Company expects that it will be unable to maintain its current new hire and Company annual equity grant practices, and, as a result, the Company expects that it will be at a significant competitive disadvantage in attracting and retaining talent. If the second amended and restated 2016 Plan is approved by our stockholders, the Company will have an additional 2,800,000 shares available for grant after the Annual Meeting. The Company believes these 2,800,000 shares, when taken together with the 339,019 shares available for grant under the amended and restated 2016 Plan as of March 31, 2024, represent the pool of shares necessary to attract, retain, and motivate directors, executives, employees, and third-party service providers of the Company.
On May 20, 2024, the Compensation Committee, as part of the Company’s regular annual grant process, granted an aggregate of 188,596 stock options and 74,745 time-based restricted stock units to certain of the Company’s employees (including the NEOs) under the 2016 Plan. These stock options and time-based restricted stock units are not reflected above in the number of shares available for grant under the amended and restated 2016 Plan as of March 31, 2024. In addition, on May 20, 2024, the Compensation Committee also approved contingent grants of a specified dollar value of performance-based stock unit awards to certain of the Company’s employees (including the NEOs), the receipt of which performance-based stock units by the grantees is subject to the receipt of shareholder approval of the second amended and restated 2016 Plan pursuant to this Proposal 4. The number of performance-based stock units to be received by each grantee will be determined as the quotient obtained by dividing the dollar value of the performance-based stock award granted to such grantee by the 20-day average price of the Company’s common stock as of the grant date. If these performance-based stock units were granted upon on the date of their approval by the Compensation Committee, such number of performance-based stock units would be in excess of the number of shares remaining available under the amended and restated 2016 Plan for future issuance. These contingently awarded performance-based stock units are described in further detail under the “New Plan Benefits” section below. If this Proposal 4 is not approved, these contingently awarded performance-based stock units will be forfeited. In that case, we may be unable to continue to offer competitive equity award packages to attract and retain employees. If our shareholders approve this Proposal 4, a portion of the increase in the number of shares of our common stock reserved for issuance under the second amended and restated 2016 Plan would be used to satisfy these contingent grants of performance stock units. These contingently awarded performance-based stock units are also not reflected above in the number of shares available for grant under the amended and restated 2016 Plan as of March 31, 2024.
When considering the number of additional shares to add to the 2016 Plan, the Board and our Compensation Committee reviewed, among other things, the potential dilution to current shareholders as
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2024 PROXY STATEMENT |
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PROPOSAL 4: APPROVE OF COLUMBUS MCKINNON CORPORATION SECOND AMENDED AND RESTATED 2016 LONG TERM INCENTIVE PLAN
Description of the Plan
A summary of the principal features of the Plan is provided below but is qualified in its entirety by reference to the full text of the second amended and restated 2016 Plan attached hereto as Appendix A. Capitalized terms used in this Proposal 4 but not defined herein have the meanings ascribed to them in the second amended and restated 2016 Plan.
The Plan is intended to advance the best interests of the Company and our shareholders by providing those persons who have substantial responsibility for the management and growth of the Company with additional performance incentives and an opportunity to obtain or increase their proprietary interest in the Company, thereby encouraging them to continue in their employment or affiliation with the Company or its affiliates.
The second amended and restated 2016 Plan will become effective upon shareholder approval and will continue until June 4, 2034, unless sooner terminated. In addition, no ISOs may be granted under the Plan on or after June 4, 2034. Any Awards granted before June 4, 2034 may extend beyond the expiration or termination date.
Plan Share Limits
The maximum number of shares of common stock that were available for Awards under the 2016 Plan upon its initial adoption was 2,000,000 shares, and an additional 2,500,000 shares were added by the amendment and restatement of the 2016 Plan in 2019. If the shareholders approve the second amended and restated 2016 Plan, the 4,500,000 shares of common stock available for Awards that were previously authorized under the 2016 Plan will be increased by 2,800,000 shares to a total of 7,300,000 shares of common stock. The additional 2,800,000 shares of common stock, when combined with the existing 339,019 shares still available under the 2016 Plan as of March 31, 2024, will result in 3,139,019 shares being available for Awards under the second amended and restated 2016 Plan.
To the extent the Company grants a stock option or a SAR under the 2016 Plan, the number of shares that remain available for future grants under the 2016 Plan shall be reduced by an amount equal to the number of shares subject to such stock option or SAR. To the extent the Company grants a Full Value Award or settles a Performance Share, Performance Share Unit or Performance Unit Award (collectively, “Performance Award”) in shares, the number of shares that remain available for future grants under the 2016 Plan shall be reduced by an amount equal to 2.1 times the number of shares subject to such Full Value Award or Performance Award.
To the extent that shares subject to an outstanding stock option, SAR or Full Value Award granted under the Prior Plans are not issued or delivered by reason of (i) the expiration, termination, cancellation or forfeiture of such Award (excluding shares subject to an option cancelled upon settlement in shares of a related tandem SAR or shares subject to a tandem SAR cancelled upon exercise of a related option), (ii) the settlement of such Award in cash or (iii) the exchange (with the Compensation Committee’s permission) prior to the issuance of shares for Awards not involving shares, then such shares shall again be available under the 2016 Plan; provided, however, that shares subject to an Award under the 2016 Plan or the Prior Plans shall not again be available for issuance under the 2016 Plan if such shares are (x) shares that were subject to a stock option or a SAR and were not issued or delivered upon the net settlement or net exercise of such option or SAR, (y) shares delivered to or withheld by the Company to pay the exercise price or the withholding taxes related to an outstanding Award or (z) shares repurchased by the Company on the open market with the proceeds of an option exercise.
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2024 PROXY STATEMENT |
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PROPOSAL 4: APPROVE OF COLUMBUS MCKINNON CORPORATION SECOND AMENDED AND RESTATED 2016 LONG TERM INCENTIVE PLAN
Treatment of Awards Upon a Change in Control and Related Transactions
Unless the Compensation Committee determines otherwise and set forth in an award agreement, if there is a change in control of the Company, Awards granted under the 2016 Plan will have their vesting and payment accelerated based on a “double trigger,” which requires the occurrence of a change in control coupled with the termination of employment or service to the Company within two years thereafter.
Under the 2016 Plan, a change in control may be triggered if: (i) there is an acquisition of 20% or more of the outstanding Company shares or the voting power of the Company’s outstanding voting securities; (ii) during any period of two consecutive years, individuals on the Board at the beginning of such two-year period cease to constitute a majority of the Board, unless such new directors are approved by the vote of at least two-thirds of the directors then still in office who were either directors at the beginning of the period or whose election or nomination for election was previously so approved; (iii) there is consummation of a reorganization, merger, or consolidation or sale of our Company with any other entity, unless at the completion of such transaction (x) our shareholders continue to own more than 60% of the outstanding voting securities of the Company or the surviving entity or (y) no person beneficially owns 20% or more of our outstanding voting securities; (iv) any person or persons acquire all or substantially all of the assets of the Company, whether in a single transaction or series of transactions; or (v) the consummation of a plan of dissolution or complete liquidation of the Company.
Awards Subject to Clawback/Recoupment
The Awards granted under the 2016 Plan and any cash payment or shares delivered pursuant to such an award are subject to forfeiture, recovery by the Company or other action pursuant to the applicable award agreement or any clawback or recoupment policy which the Company may adopt from time to time, including without limitation the Company’s Clawback Policy and any additional policy which the Company may have adopted under the Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules and regulations thereunder, or as otherwise required by law.
Amendment of Awards or Plan and Adjustment of Awards
The Compensation Committee may at any time alter, amend, modify, suspend, or terminate the 2016 Plan or any outstanding Award in whole or in part. No amendment of the 2016 Plan will be made without shareholder approval if shareholder approval is required by law, regulation, or stock exchange rule. No amendment may adversely affect in any material way the rights of any participant under an outstanding Award without his or her written consent, unless specifically provided for in the 2016 Plan.
Additional Provisions
Neither ISOs nor, except as the Compensation Committee otherwise expressly determines, other Awards may be transferred other than by will or by the laws of descent and distribution. During a recipient’s lifetime, an ISO and, except as the Compensation Committee may determine, other non-transferable Awards requiring exercise, may be exercised only by the recipient.
If provided in the award agreement, a participant’s rights to an Award may be subject to a participant agreeing to not compete with the Company or any of its subsidiaries, and to not solicit our business or employees. In addition, participants may be subject to non-disclosure and non-disparagement requirements. A breach of these restrictions may result in cancellation of Awards or the recovery by us of gain realized under an Award.
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2024 PROXY STATEMENT |
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PROPOSAL 4: APPROVE OF COLUMBUS MCKINNON CORPORATION SECOND AMENDED AND RESTATED 2016 LONG TERM INCENTIVE PLAN
Restricted Stock Units (RSUs), Deferred Stock Units (DSUs), Performance Share Units (PSUs) and Performance Units (PUs)
In general, a participant has no taxable income at the time of grant of any RSUs, DSUs, PSUs or PUs, but realizes ordinary income in connection with the settlement of any RSUs, DSUs, PSUs or PUs equal to the fair market value (at the time of settlement) of any shares delivered or the amount of cash received by the participant in settlement of the RSUs, DSUs, PSUs or PUs. In general, the same amount is deductible by us as a compensation expense at the same time.
Restricted Stock and Performance Shares
In general, a participant has no taxable income at the time any restricted stock or performance shares are granted but realizes ordinary income at the time any restricted stock or performance shares vest equal to the fair market value (at the time of vesting) of any vested shares. Alternatively, if a participant makes a “Section 83(b) Election,” the participant realizes ordinary income at the time any restricted stock or performance shares are granted equal to the fair market value of the restricted stock or performance shares on the date the restricted stock or performance shares are granted. In general, the amount of compensation the participant is required to recognize as ordinary income is deductible by us for the year in which the compensation amount is includible in income by the participant.
Cash-Based Awards and Other Stock-Based Awards
The federal income taxation of any cash-based awards or other stock-based awards will depend on the terms and conditions of those awards. However, it is generally anticipated that a participant will realize ordinary income at the time any cash-based awards or stock-based awards are paid to the participant equal to the fair market value (at the time of settlement) of any shares delivered or the amount of cash received by the participant in settlement of the cash-based award or stock-based award, and that the same amount would generally be deductible by us as a compensation expense at the same time.
Other
Awards under the Plan may be subject to tax withholding. Where an award results in income subject to withholding, we may require the participant to remit the necessary taxes to us. If the Compensation Committee approves, participants may satisfy their tax withholding requirements by causing shares of our common stock to be withheld.
Under the so-called “golden parachute” provisions of the Code, the accelerated vesting or payment of awards in connection with a change in control of a corporation may be required to be valued and taken into account in determining whether participants have received compensatory payments, contingent on the change in control, in excess of certain limits. If these limits are exceeded, a portion of the amounts payable to the participant may be subject to an additional 20% federal tax and may be nondeductible to the corporation.
Certain awards granted under the Plan may constitute a “nonqualified deferred compensation plan” under Code Section 409A. Failure to satisfy the applicable requirements under Code Section 409A could result in the acceleration of income and additional income tax liability, including certain penalty taxes. Any awards granted under the Plan are intended to be exempt from or compliant with Code Section 409A.
Code Section 162(m) imposes a $1 million limit on the amount a public company may deduct for compensation paid in a year to a company’s principal executive officer, principal financial officer, or any of the company’s three other most highly compensated executive officers who are employed in such role at any time during the year (each, a “covered employee”). Once an individual is a covered employee in a taxable year beginning after December 31, 2016, the individual remains a covered employee, even after
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2024 PROXY STATEMENT |
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CORPORATE GOVERNANCE POLICY
Effective corporate governance is essential for maximizing long-term value for our shareholders. We review our corporate governance policies and practices and compare them to those suggested by various authorities in corporate governance and the practices of other public companies. We also consider the rules of the SEC and the listing standards of Nasdaq. Our beliefs have been grounded in being a values-based ethically led organization, and it is this foundation that continues to influence our decisions and leadership.
Our governance structure is set forth in our Corporate Governance Guidelines and other key governance documents outline the composition, operations, and responsibilities of the Board. These guidelines are reviewed at least annually and updated as appropriate in response to evolving best practices, regulatory requirements, feedback from our annual Board evaluations, and recommendations made by our shareholders, all with the goal of supporting and effectively overseeing our ongoing strategic transformation.
Our Corporate Governance Guidelines embody many of our long-standing practices, policies, and procedures, which collectively form a corporate governance framework that promotes the long-term interests of our shareholders, promotes responsible decision-making and accountability, and fosters a culture that allows our Board and management to pursue Columbus McKinnon’s strategic objectives.
KEY BOARD RESPONSIBILITIES
The Board’s Strategic Oversight Role
The Board has oversight responsibility for our company’s business strategy and strategic planning. Our Board formally reviews our Company’s business strategy, including the risks and opportunities facing the Company and its portfolio, at an annual strategic planning session. In addition, long-range strategic issues, including the performance and strategic fit of our businesses, are discussed as a matter of course at Board meetings. Our Board regularly discusses corporate strategy throughout the year with management formally as well as informally and during executive sessions of the Board as appropriate.
Columbus McKinnon operates in a rapidly changing environment that requires significant Board engagement with our strategy. As Columbus McKinnon advances its transformation, the Board works with management to respond to a dynamically changing environment. Given the iterative nature of this transformation, the Board’s oversight over strategy is a continuous process. Throughout the year, the Board and its committees oversee and guide management with respect to a variety of strategic matters, and strategic discussions are embedded in Board and Board committee meetings
While the Board and its committees oversee our strategic planning process, management is responsible for executing our strategy. The Board receives regular updates and engages actively with our senior management team regarding key strategic initiatives, technology updates, competitive and economic trends, and other developments. The Board’s oversight and our management’s execution of our business strategy are intended to help promote the creation of long-term shareholder and stakeholder value in a sustainable manner, with a focus on assessing both potential opportunities available to us and risks that we might encounter.
Columbus McKinnon believes that a strong, ethical corporate culture is a key element of sound and sustainable corporate governance practices, beginning at the top with the CEO and other senior leadership. The Board plays a critical role in supporting and overseeing Columbus McKinnon’s corporate culture, mission, values, and setting the “tone at the top” by adopting policies, a code of ethics, a philosophy for hiring, and compensation practices that promote ethical behavior, compliance with laws and regulations, including those pertaining to consumer protection and privacy, effective internal controls
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2024 PROXY STATEMENT |
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CORPORATE GOVERNANCE POLICY
The Board’s Role in Human Capital
We believe that our team members are the foundation of our business and that their hard work, passion, commitment, and experience drive our success. The Board views effective human capital management as key to the Company’s ability to execute its long-term strategy. As a result, the Board oversees and regularly engages with our Chief Executive Officer, Chief Human Resources Officer, and senior leadership on a broad range of human capital management topics, including culture, talent management, succession planning, compensation, benefits, diversity, equity & inclusion, and feedback gathered from the Company’s annual employee engagement survey.
We believe our team members are key to our transformation and continued progress. We have built an open culture where great people have the opportunity to flourish. We empower our partners to deliver on our mission of improving lives to guide our customer offerings, serve our customers, and grow within our organization. We encourage candid feedback, a broad range of opinions, innovative thinking, and, importantly, people who have a passion for the business.
We strive to create an environment that embraces diverse backgrounds and perspectives. Or commitment to fostering a diverse, equitable, and inclusive environment begins at the top. We are committed to creating a culture where partners feel as if they can achieve their career goals, through ongoing growth and development opportunities and fair performance management and promotion processes. We offer competitive compensation and benefits programs, as well as a range of health and wellness offerings. We also invest significant resources to attract, develop, and retain top talent.
At Columbus McKinnon, maintaining a healthy, safe environment for our team members and customers is embedded in our mission and values. We are committed to driving a culture of safety for our teams, customers and communities through standard operation, the use of technology to deliver training and the attitude of continuous improvement.
Similarly, we consistently reinforce these strategic focus areas through repeated communication and recognition of our six Values created to support a transformation-focused culture—not just transformation of the business, but of each employee as they grow within the Company.
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2024 PROXY STATEMENT |
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CORPORATE GOVERNANCE POLICY
GENERAL CORPORATE GOVERANCE POLICY
Our Board of Directors believes that its overriding responsibility is to offer guidance and the benefit of its collective experience to help our management understand the risks confronting, and opportunities available to our Company. In furtherance of this responsibility, our Board of Directors has adopted a General Corporate Governance Policy setting forth certain policies, guidelines, and procedures it deems important to the successful satisfaction of this responsibility.
These policies and procedures include guidelines as to the eligibility, independence, evaluation, education, succession planning, compensation, and indemnification of our directors, as well as with respect to specific transactions requiring the prior formal approval of our Board of Directors. A copy of our General Corporate Governance Policy is posted on the Investor Relations section of the Company’s website at investors.cmco.com.
BOARD LEADERSHIP STRUCTURE
The leadership structure of our Board is designed to promote robust oversight, independent viewpoints, and the promotion of the overall effectiveness of the Board. Our board regularly reviews its leadership structure to evaluate whether the structure remains appropriate for the company. As part of our annual Board of Directors self-evaluation process, we evaluate our leadership structure to ensure that it continues to provide the optimal structure for our Company and shareholders. A Chair rotation and succession schedule is reviewed and updated annually by the Board in addition to the Chairman conducting individual reviews with the Directors on their interests and thoughts around Chair candidates, rotation, and succession.
We believe our current leadership structure is the optimal structure for our Company at this time. The Board of Directors regularly evaluates the composition of the Board to ensure an appropriate mix of skills, experiences, and diversity of perspectives to effectively oversee the strategic direction of the Company and considers its leadership structure in this process. In 2023 the Board refreshed its committee structure, appointed a new Chairman and Lead Chair, and presently includes four of nine members that represent diverse demographic backgrounds, three of whom are women, and two are ethnically diverse.
The roles of the Company’s Chairman of the Board and President and Chief Executive Officer have been served by separate individuals since 1998. This leadership structure supports our belief that it is the President and Chief Executive Officer’s responsibility to manage the Company and the Chairman’s responsibility to manage the Board. Since August 2005 through today, the Chairman of the Board has been filled by an independent Director except between January 10, 2020, to June 1, 2020, where both roles were filled by Mr. Fleming on an interim basis while the Board searched for a CEO. As directors continue to have more oversight responsibilities than ever before, we believe it is beneficial to have an Independent Chairman whose sole job is leading the Board. We believe over the years that our President and Chief Executive Officer and Chairman of the Board have had an excellent working relationship. By separating the roles of the Chairman of the Board and President and Chief Executive Officer positions, we ensure there is no duplication of effort between them. We believe this provides strong leadership for our Board of Directors, while also positioning our President and Chief Executive Officer as the leader of the Company in the eyes of our customers, employees, and other stakeholders.
BOARD COMPOSITION AND DIVERSITY
Our Corporate Governance and Nomination Committee is responsible for developing the general criteria, subject to approval by our Board of Directors, for use in identifying, evaluating, and selecting qualified candidates for election or re-election to the Board. The Governance and Nomination Committee annually reviews the appropriate skills and characteristics required of Board members in the context of the current
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2024 PROXY STATEMENT |
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CORPORATE GOVERNANCE POLICY
composition of the Board including, reviewing, and updating a Board competency skills matrix for each Director. The Governance and Nomination Committee, in recommending candidates for election or re-election to the Board, seeks to create a Board that is strong in its collective knowledge and has a diversity of skills and experience with respect to accounting and finance, management and leadership, vision and strategy, business operations, business judgment, industry knowledge, corporate governance, and global markets. When the Corporate Governance and Nomination Committee review a potential new candidate, it looks specifically at the candidate’s qualifications in light of the needs of the Board and the Company at that time, given the attributes of the existing Directors.
The charter of the Corporate Governance and Nomination Committee includes as a statement of responsibility that assures the composition of the Board of Directors includes appropriate breadth, depth and diversity of experience and capabilities. In identifying candidates for Director, the Corporate Governance and Nomination Committee and the Board of Directors consider (i) the comments and recommendations of Directors made in connection with the Board’s annual self-evaluation regarding the qualifications and effectiveness of the existing Board of Directors or additional qualifications that may be required when selecting new board members, (ii) the requisite expertise and sufficiently diverse backgrounds of the Board of Directors overall composition, (iii) the independence of outside Directors and other possible conflicts of interest of existing and potential members of the Board of Directors, and (iv) all other factors it considers appropriate. Our current board has been refreshed over the past several years to include a rich mixture of educational, professional, experiential, gender, and global diversity and we will continue to consider these and the other mentioned factors when considering future directors.
We include in our ranks four sitting and one former CEO, two former CFO’s, two directors with deep technology backgrounds, and nine with leadership experience outside of the United States. The following statistics are for the Directors up for election.
BOARD OF DIRECTORS INDEPENDENCE
Our Board of Directors has determined that each of its current members, other than Mr. Wilson, is independent within the meaning of the NASDAQ Stock Market, Inc., listing standards as currently in effect. In addition, our Chairman of the Board, Lead Director and each member of the Audit Committee, the Corporate Governance and Nominating Committee and the Human Capital, Compensation and Succession Committee is independent.
BOARD MEETINGS AND ATTENDANCE
The Board of Directors and its committees meet regularly throughout the year and also hold special meetings and act by written consent from time to time as appropriate. All Directors are expected to attend each meeting of the Board of Directors and the committees on which he or she serves, and are also invited, but not required, to attend the Annual Meeting. Agendas for meetings of the Board of Directors include executive sessions for the independent Directors to meet without the management Director present. During the fiscal year ended March 31, 2024, our Board of Directors held 6 meetings. Each Director has attended at least 75% of the aggregate number of meetings of our Board of Directors and meetings held by all committees of our Board of Directors on which he or she served and attended the 2023 Annual Shareholder Meeting, other than Mr. Stephens who was elected by the Board in March 2024.
BOARD, COMMITTEE AND DIRECTOR ASSESSMENT PROCESS
Annually, in compliance with the Nasdaq rules and other applicable laws, rules, and regulations, the Board and its committees conduct formal self-evaluations to assess and improve the Board’s effectiveness and functionality. Our Board recognizes that a robust and constructive evaluation process is an essential component of Board effectiveness. The Corporate Governance and Nomination
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2024 PROXY STATEMENT |
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CORPORATE GOVERNANCE POLICY
Committee has the responsibility for administering an annual review process for the Board. The Corporate Governance and Nomination Committee has established a rigorous and thorough annual assessment process that include the completion of written assessments of the performance of the full Board and its committees, as well as one-on-one interviews by the Chairman of all directors. The directors also complete a written assessment of the performance of the Chief Executive Officer.
At the completion of the process, each director receives the Board and Committee assessment results. The Chairman of the Board also reviews the assessment results with the full Board. The Chairman and Chair of Human Capital and Succession Committee meet with the Chief Executive Officer to review his performance. In addition, the chair of each committee shares the results of this process with the committee members.
DIRECTOR NOMINATIONS
The nominating and corporate governance committee periodically reviews and recommends to our board the skills, experience, characteristics, and other criteria for identifying and evaluating directors. Our board expects directors to be open and forthright, to develop a deep understanding of the Company’s business, and to exercise sound judgment in fulfilling their oversight responsibilities. Directors should embrace the Company’s values and culture and should possess the highest levels of integrity.
The nominating and corporate governance committee evaluates the composition of our board annually to assess whether the skills, experience, characteristics, and other criteria established by our board are currently represented on our board as a whole and in individual directors, and to assess the criteria that may be needed in the future in light of the Company’s anticipated needs.
The board and the nominating and corporate governance committee also actively seek to achieve a diversity of occupational and personal backgrounds on the board, including diversity with respect to demographics such as gender, race, ethnic and national background, geography, age, and sexual orientation. As part of the search process for each new director, the nominating and corporate governance committee actively seeks out women and diverse candidates to include in the pool from which board nominees are chosen. The nominating and corporate governance committee reviews the qualifications of director candidates and incumbent directors in light of the criteria approved by our board and recommends the Company’s candidates to our board for election by the Company’s shareholders at the applicable annual meeting. We also assess qualifications and characteristics of our directors, including racial and ethnic diversity, as part of our board’s annual self-evaluation process.
CODE OF CONDUCT
Our Board of Directors adopted a Code of Conduct which governs all of our directors, officers, and employees, including our Chief Executive Officer and other executive officers. This Code of Conduct is posted on the Corporate Governance section of the Company’s website at www.cmco.com and on the Company’s intranet. Our Chief Compliance Officer has responsibility to implement and maintain an effective ethics and compliance program. She also has responsibility to provide updates on our ethics and compliance program to the Audit Committee. Our Director of Corporate Social Responsibility is responsible for developing our Environmental, Social and Governance (ESG) compliance platform and in 2023, we published our third annual Sustainability Report.
COMMITTEES OF THE BOARD OF DIRECTORS
During Fiscal 2024, the Board has three standing Committees: Audit, Human Capital, Compensation and Succession Committee, and Corporate Governance and Nomination. The charter for each committee is available on the Company’s Investor Relations website at https://investors.cmco.com/governance/governance-documents.
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2024 PROXY STATEMENT |
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57 |
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OUR EXECUTIVE LEADERSHIP OFFICERS
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| Name |
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Age |
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Position |
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| David J. Wilson |
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55 |
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President and Chief Executive Officer |
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| Bert A. Brant |
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63 |
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SVP, Global Operations |
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| Appal Chintapalli |
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49 |
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President, EMEA and APAC |
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| Alan S. Korman |
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63 |
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SVP General Counsel, Corp. Development and Secretary |
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| Mario Y. Ramos Lara |
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51 |
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SVP, Product Development and Marketing |
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| Mark Paradowski |
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54 |
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SVP, Information Services and Chief Digital Officer |
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| Gregory P. Rustowicz |
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64 |
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EVP, Finance and Chief Financial Officer |
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| Terry Schadeberg |
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60 |
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President, Americas |
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| Adrienne Williams |
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48 |
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SVP and Chief Human Resources Officer |
All of our executive officers are elected annually at the first meeting of our Board of Directors following the Annual Meeting of Shareholders and serve at the discretion of our Board of Directors. There are no family relationships between any of our officers or Directors. Recent business experience of our executive officers who are not also Directors follows:
Bert A. Brant joined the Company in February 2018 as Vice President, Global Manufacturing Operations. He was promoted to Sr. Vice President, Global Operations in July 2022. Prior to that he was SVP, Global Operations for Colfax Fluid Handling, a division of Colfax Corporation. Prior to joining Colfax in 2014, he led operations in the U.S., Mexico, and Canada for Apex Tool Group. He held other manufacturing and operational leadership roles at Pergo LLC, Rexnord Corporation and Denso Manufacturing, where he was trained by Toyota in Japan on the Toyota Production System.
Appal Chintapalli joined the Company in March 2018 as the Vice President of Engineered Products. He was promoted to President, EMEA & APAC in April 2022. Prior thereto, he was General Manager and Vice President of IT & Edge Infrastructure EMEA in Germany for Vertiv. Previously, he worked in a number of positions for Emerson including Vice President of Marketing for Emerson Network Power EMEA in London, UK, and in the U.S., Vice President of Enterprise Services for the Emerson Climate Division, and Corporate Marketing Manager. Appal holds an MBA from Harvard Business School, and a Bachelor and Master of Science in Chemical Engineering.
Alan S. Korman joined the Company in January 2011 as General Counsel and Assistant Secretary. He was promoted to Sr. Vice President, General Counsel, Corp. Development and Secretary in July 2022. Prior thereto, he held various positions with the Company including Vice President, General Counsel, Corp. Development and Secretary, and held the role of CHRO from 2018-2021. From 1994 until January 2011, he served in various senior executive positions of responsibility at Ivoclar Vivadent, Inc., including Vice President, General Counsel and Secretary, and President of Pentron Ceramics, Inc.
Mario Y. Ramos Lara joined the Company in June 2018 as Vice President, Global Product Development. He was promoted to Sr. Vice President, Product Development and Marketing in July 2022. Prior thereto, he spent 18 years in various roles at Schneider Electric, most recently Vice President, Strategic Marketing, Product Management and Partnerships for Schneider’s Final Distribution line of business. Other positions at Schneider included Vice President, Global Engineering, Director of Engineering for Low and Medium Voltage Equipment and Director, Global Technology Center in Monterrey, Mexico. Mario holds an MBA from Vanderbilt, and a Bachelor and Master of Science in Mechanical Engineering.
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| 64 |
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2024 PROXY STATEMENT |
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SHAREHOLDERS’ PROPOSALS
Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended, some shareholder proposals may be eligible for inclusion in our 2024 proxy statement. These shareholder proposals must be submitted, along with proof of ownership of our stock in accordance with Rule 14a-8, by U.S. mail, postage prepaid, to our Corporate Secretary, Columbus McKinnon Corporation, 13320 Ballantyne Corporate Place, Charlotte NC 28277. Failure to deliver a proposal in accordance with this procedure may result in the proposal not being deemed timely received.
In addition, under our By-laws, any shareholder who intends to nominate a candidate for election to the Board or to propose any business at our 2024 annual meeting (other than precatory (non-binding) proposals presented under Rule 14a-8) pursuant to the advance notice provisions of the By-Laws, must give notice to our Corporate Secretary not less 90 days nor more than 120 days prior to the first anniversary of the 2023 Annual Meeting. In each case, the notice must include information specified in our By-Laws, including information concerning the nominee or proposal, as the case may be, and information about the shareholder’s ownership of and agreements related to our stock. In the event the date of the 2024 Annual Meeting is advanced by more than thirty (30) days, or delayed by more than sixty (60) days, from such anniversary date, notice by the shareholder, to be timely, must be so delivered, or mailed and received, not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such annual meeting is first made by the Corporation. In no event shall any adjournment or the announcement thereof commence a new time period (or extend any time period) for the giving of a shareholder’s notice as described above.
In addition to the information required in a notice of a proposal, a notice to our Corporate Secretary with respect to nominations must contain certain information regarding each proposed nominee for director. Further information regarding proposals or nominations by shareholders can be found in Section 1.11 of the Company’s By-Laws. If our Board of Directors or a designated committee determines that any proposal or nomination was not made in a timely fashion or fails to meet the information requirements of Section 1.11, such proposal or nomination will not be considered.
As of the date of this Proxy Statement, the Board of Directors does not intend to present, and has not been informed that any other person intends to present, any matter for action at this meeting other than those specifically referred to in this Proxy Statement. If other matters properly come before the meeting, it is intended that the holders of the proxies will act with respect thereto in accordance with their best judgment.
CONTACTING THE BOARD OF DIRECTORS
Our Board of Directors has adopted a written policy regarding communications with our Board of Directors. A copy of this policy is posted on the Investor Relations section of the Company’s website at www.cmco.com.
PROCEDURES FOR RECOMMENDING INDIVIDUALS TO SERVE AS DIRECTORS
The nominating and corporate governance committee also considers director candidates recommended by our shareholders. Any shareholder who wishes to propose director nominees for consideration by our nominating and corporate governance committee, but does not wish to present such proposal at an annual meeting of shareholders, may do so at any time by directing a description of each nominee’s name and qualifications for board membership to the Chair of the Corporate Governance and
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2024 PROXY STATEMENT |
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69 |
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COMPENSATION DISCUSSION AND ANALYSIS
Process for Setting Executive Compensation
Role of our Human Capital, Compensation and Succession Planning Committee (“Compensation Committee”) and Management in Compensation Decisions
As described below, the primary elements of our executive compensation program are annual base salary, annual short-term cash incentives, long-term equity incentives, and other benefits and perquisites. Together, these items are complementary and serve the goals described above.
Our executive compensation program is developed and overseen by the Compensation Committee. The purpose of the Compensation Committee is to assist our Board in discharging its responsibilities relating to the compensation of our executive officers and directors, by overseeing Columbus McKinnon’s overall compensation philosophy, policies, and programs, evaluating the compensation and performance of our executive officers, and reviewing, approving, and modifying the terms of our compensation and benefit plans and programs as appropriate. Subject in certain circumstances to approval by our Board, the Compensation Committee has the sole authority to make final decisions with respect to our executive compensation program. For more information regarding the authority and responsibilities of the Compensation Committee, please refer to the Compensation Committee’s charter, which is available via Columbus McKinnon’s Investor Relations website at investors.cmco.com/governance/governance-documents.
In making decisions regarding the allocation of compensation between short-term and long-term compensation, between cash and non-cash compensation, and among different forms of cash and non-cash compensation, the Compensation Committee took into account the views and recommendations of management, in particular our Chief Executive Officer (“CEO”) (except with respect to his own compensation).
The Compensation Committee establishes performance objectives for the CEO based on our annual business plan and long-term strategic goals approved by the Board. Progress against these goals is monitored by the Compensation Committee on a quarterly basis. The Compensation Committee evaluates the CEO’s performance against these goals annually, with input provided for this evaluation from all independent directors.
The Compensation Committee also considers market data validated by our independent compensation consultant, comparisons of our performance to our peers, and strategic achievements during the year, such as acquisitions and their integration into our business and value-creating divestitures. Based on these factors, the Compensation Committee makes recommendations concerning base salary increases, annual incentive award targets and payments under the Annual Incentive Plan and targets and awards under our long-term incentive program.
The Compensation Committee has regularly scheduled executive sessions to discuss CEO performance and compensation and other matters without any executive officers present.
Except for the CEO and Chief Financial Officer (“CFO”), the Compensation Committee reviews and approves base salary increases, Annual Incentive Plan targets and awards, long-term incentive program targets and awards and similar arrangements for the other NEOs in the summary compensation table below are determined by the Compensation Committee after receiving recommendations from our CEO with input from the Chief Human Resource Officer (“CHRO”) and our independent compensation consultant. The Compensation Committee makes the final decision and approves compensation decisions for all NEOs, as well as all other executive officers, except for the CEO and CFO. All aspects of the CEO’s and CFO’s compensation are approved by our full Board.
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| 74 |
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2024 PROXY STATEMENT |
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COMPENSATION DISCUSSION AND ANALYSIS
12-consecutive month earnings during the last consecutive 60 months prior to retirement or (b) the average 12-consecutive month earnings during any 60-consecutive month period within the last 120 months prior to retirement) plus 0.5% of that part, if any, of final average earnings in excess of social security covered compensation, multiplied by (ii) such participant’s years of credited service, limited to 35 years.
Effective March 31, 2012, the CMCO Pension Plan was frozen to new entrants and to participants with less than 65 combined age and service points. Participants who had attained 65 combined age and service points as of March 31, 2012, continued to accrue benefits. Subsequent to this, the CMCO Pension Plan was frozen to all participants as of December 31, 2017.
On January 1, 2018, we changed our 401(k) to a Safe Harbor 401(k) retirement savings plan covering non-union U.S.-based associates.
Associates may now contribute 100% of eligible annual cash compensation, subject to limits set by the Internal Revenue Code. The match is now standard for all associates, with 100% of the first 4% matched and all associates receiving a core contribution of 2% of eligible wages.
Employee Stock Ownership Plan
We maintain an Employee Stock Ownership Plan (“ESOP”) for the benefit of our U.S.-based, non-union associates including our U.S.-based NEOs. The purpose of the ESOP is to encourage and enable our eligible partners to acquire a proprietary interest in us through the ownership of our Class A common stock.
The ESOP is considered a retirement benefit by the Company, in conjunction with its defined benefit pension and 401(k) retirement savings plans. Effective January 1, 2012, the ESOP was closed to new participants. The final ESOP allocation was made on March 31, 2015. All participants are 100% vested and no future contributions will be made to the ESOP.
Non-Qualified Deferred Compensation Plan
We maintain a non-qualified deferred compensation plan (the “NQDC Plan”) under which eligible participants (including our directors and U.S.-based NEOs) may elect to defer a portion of their cash compensation. The NQDC Plan offers a Company match and core contributions consistent with the benefits each individual is eligible for in our qualified 401(k) plan for excess contributions above the statutory limit. Employees may defer up to 75% of their base salary and up to 100% of annual short-term incentive cash compensation. Directors are permitted to defer up to 100% of their annual cash retainer amount. Payment of balances will occur in accordance with Internal Revenue Code Section 409A requirements.
Perquisites
During fiscal 2024, we provided our NEOs with limited perquisites, including wellness exams. Beginning in fiscal 2025, financial planning has been added to the list of perquisites. We provide these limited perquisites to ensure our compensation program remains competitive with companies for which we compete for talent.
Severance
With the exception of Mr. Wilson, the Company has no employment agreements with its NEOs, but does provide the NEOs with eligibility for severance benefits under our general severance policy upon delivery of an acceptable release of legal claims. The Committee and our Board believe the severance benefits offered under Mr. Wilson’s employment agreement and in the Columbus McKinnon Executive Severance Plan aid in attracting and retaining experienced executives and reflect fair compensation in the event of a qualifying termination.
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| 86 |
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2024 PROXY STATEMENT |
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2016 LONG TERM INCENTIVE PLAN
Columbus McKinnon Corporation Second
Amended and Restated
2016 Long Term Incentive Plan
Effective June 4, 2024
Article 1. Establishment, Purpose, and Duration
1.1 Establishment. Columbus McKinnon Corporation, a New York corporation (hereinafter referred to as the “Company”), previously established an incentive compensation plan known as the Columbus McKinnon Corporation 2016 Long Term Incentive Plan (as amended and restated from time-to-time, the “Plan”).
This Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Performance Shares, Performance Share Units, Performance Units, Cash-Based Awards, and Other Stock-Based Awards.
This Plan was initially effective on May 23, 2016 (the “Effective Date”) and obtained shareholder approval on July 18, 2016. The Plan was subsequently amended and restated effective June 5, 2019 (“the First Restatement Date”) and obtained shareholder approval on July 22, 2019. The Plan is hereby amended and restated June 4, 2024 (the “Second Restatement Date”), subject to shareholder approval. The Plan as so amended and restated by this second amendment and restatement of the Plan and approved by shareholders shall apply to any Awards granted after the Second Restatement Date. Any Awards granted prior to the Second Restatement Date shall continue to be governed by the terms of the Plan as in effect at the time the Award was granted.
1.2 Purpose of This Plan. The purpose of this Plan is to provide a means whereby Employees, Directors, and Third-Party Service Providers of the Company develop a sense of proprietorship and personal involvement in the development and financial success of the Company, and to encourage them to devote their best efforts to the business of the Company, thereby advancing the interests of the Company and its shareholders. A further purpose of this Plan is to provide a means through which the Company may attract able individuals to become Employees or serve as Directors or Third-Party Service Providers of the Company and to provide a means whereby those individuals upon whom the responsibilities of the successful administration and management of the Company are of importance can acquire and maintain stock ownership, thereby strengthening their concern for the welfare of the Company.
1.3 Duration of This Plan. Unless sooner terminated as provided herein, this Plan shall terminate ten (10) years from the Second Restatement Date. After this Plan is terminated, no Awards may be granted but Awards previously granted shall remain outstanding in accordance with their applicable terms and conditions and this Plan’s terms and conditions. Notwithstanding the foregoing, no Incentive Stock Options may be granted more than ten (10) years after the Second Restatement Date.
1.4 No More Grants Under Prior Plans. After the Effective Date, no more grants will be made under the Prior Plans.
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2024 PROXY STATEMENT |
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105 |
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2016 LONG TERM INCENTIVE PLAN
Article 2. Definitions
Whenever used in this Plan, the following terms shall have the meanings set forth below, and when the meaning is intended, the initial letter of the word shall be capitalized.
2.1 “Affiliate” shall mean any corporation or other entity (including, but not limited to, a partnership or a limited liability company) that is affiliated with the Company through stock or equity ownership or otherwise and is designated as an Affiliate for purposes of this Plan by the Committee.
2.2 “Annual Award Limit” or “Annual Award Limits” have the meaning set forth in Section 4.3 (Annual Award Limits).
2.3 “Award” means, individually or collectively, a grant under this Plan of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Performance Shares, Performance Share Units, Performance Units, Cash-Based Awards, or Other Stock- Based Awards, in each case subject to the terms of this Plan.
2.4 “Award Agreement” means either (a) a written agreement entered into by the Company and a Participant setting forth the terms and provisions applicable to an Award granted under this Plan, or (b) a written or electronic statement issued by the Company to a Participant describing the terms and provisions of such Award, including any amendment or modification thereof. The Committee may provide for the use of electronic, Internet, or other non-paper Award Agreements, and the use of electronic, Internet, or other non-paper means for the acceptance thereof and actions thereunder by a Participant.
2.5 “Beneficial Owner” or “Beneficial Ownership” shall have the meaning ascribed to such terms in Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
2.6 “Board” or “Board of Directors” means the Board of Directors of the Company.
2.7 “Cash-Based Award” means an Award, denominated in cash, granted to a Participant as described in Article 11 (Cash-Based Awards and Other Stock-Based Awards).
2.8 “Cause” means, unless otherwise specified in an Award Agreement or in an applicable employment or service agreement between the Company, an Affiliate or a Subsidiary and a Participant, with respect to any Participant, as determined by the Committee in its sole discretion:
(a) Commission of a willful serious act, such as embezzlement, against the Company, an Affiliate or a Subsidiary which is intended to enrich the Participant at the expense of the Company, an Affiliates or a Subsidiary;
(b) Conviction of a felony involving moral turpitude; or
(c) Any willful, gross neglect or willful, gross misconduct resulting in either case in material harm to the Company, an Affiliate or a Subsidiary, or a violation of the Company’s Code of Conduct. For purposes of this Section 2.8(c), no act, or failure to act, on a Participant’s behalf will be deemed “willful” unless done, or omitted to be done, by the Participant not in good faith and without reasonable belief that the Participant’s action or omission was in the best interest of the Company.
2.9 “Change in Control” means, unless otherwise defined in an Award Agreement, any of the following events:
(a) Any “Person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, or any company owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing twenty percent (20%) or more of either (i) the then outstanding shares of common stock of the Company or (ii) the combined voting power of the Company’s then outstanding voting securities;
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| 106 |
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2024 PROXY STATEMENT |
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2016 LONG TERM INCENTIVE PLAN
(b) During any period of two (2) consecutive years (not including any period prior to the Effective Date), individuals who, at the beginning of such period, constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in paragraph (a), (c), (d) or (e) of this Section 2.9) whose election by the Board or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority thereof;
(c) There shall be consummated any reorganization, merger or consolidation of the Company with any other entity, other than (i) a reorganization, merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than sixty percent (60%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such reorganization, merger or consolidation or (ii) a reorganization, merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no “Person” (as herein above defined) beneficially owns, directly or indirectly, twenty percent (20%) or more of the combined voting power of the Company’s then outstanding voting securities;
(d) Any Person or Persons acquire all or substantially all of the assets of the Company, whether in a single transaction or series of transactions; or
(e) The consummation of plan of dissolution or complete liquidation of the Company.
For purposes hereof, ownership of voting securities shall take into account and shall include ownership as determined by applying the provisions of Rule 13d-3(d)(1)(i) (as in effect on the Second Restatement Date) pursuant to the Exchange Act.
A “Change in Control” shall not result from any transaction precipitated by the Company’s insolvency, appointment of a conservator, or determination by a regulatory agency that the Company is insolvent, nor from any transaction initiated by the Company in regard to converting from a publicly traded company to a privately held company.
To the extent necessary to comply with Code Section 409A, a Change in Control will be deemed to have occurred only to the extent the event constitutes a change in control event under Code Section 409A.
2.10 “Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time. For purposes of this Plan, references to sections of the Code shall be deemed to include references to any applicable regulations thereunder and any successor or similar provision.
2.11 “Committee” means the Human Capital, Compensation and Succession Committee of the Board or a subcommittee thereof, or any other committee designated by the Board to administer this Plan. The members of the Committee shall be appointed from time to time by and shall serve at the discretion of the Board. If the Committee does not exist or cannot function for any reason, the Board may take any action under the Plan that would otherwise be the responsibility of the Committee.
2.12 “Company” means Columbus McKinnon Corporation, a New York corporation, and any successor thereto as provided in Article 23 (Successors) herein.
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2024 PROXY STATEMENT |
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107 |
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2016 LONG TERM INCENTIVE PLAN
2.13 “Deferred Stock Unit” means a Participant’s contractual right to receive a stated number of Shares, or if provided by the Committee on the Grant Date, cash equal to the Fair Market Value of such Shares, under the Plan at the end of a specified period of time or upon the occurrence of a specified event.
2.14 “Director” means any individual who is a member of the Board of Directors of the Company.
2.15 “Disability” means, unless otherwise provided in an Award Agreement:
(a) With respect to a Participant who is a party to a written employment agreement with the Company, an Affiliate or a Subsidiary, which agreement contains a definition of “disability” or “permanent disability” (or words of like import) for purposes of termination of employment thereunder by the Company, “disability” or “permanent disability” as defined in the most recent of such agreements; or
(b) In all other cases, means such Participant’s inability to perform substantially his or her duties to the Company, an Affiliate or a Subsidiary by reason of physical or mental illness, injury, infirmity, or condition: (i) for a continuous period for one hundred eighty (180) days or one or more periods aggregating one hundred eighty (180) days in any twelve (12) month period; (ii) at such time as such Participant is eligible to receive disability income payments under any long-term disability insurance plan maintained by the Company; or (iii) at such earlier time as such Participant or the Company submits medical evidence, in the form of a physician’s certification, that such Participant has a physical or mental illness, injury, infirmity, or condition that will likely prevent such Participant from substantially performing his or her duties for one hundred eighty (180) days or longer.
To the extent necessary to comply with Code Section 409A, any reference to “Disability” under the Plan will be interpreted to mean a “disability” (within the meaning of Code Section 409A).
2.16 “Dividend Equivalent Right” means the right to receive an amount, calculated with respect to an Award other than an Option or SAR, which is determined by multiplying the number of Shares subject to the applicable Award by the per-Share cash dividend, or the per-Share fair market value (as determined by the Committee) of any dividend in consideration other than cash, paid by the Company on Shares.
2.17 “Effective Date” has the meaning set forth in Section 1.1 (Establishment).
2.18 “Eligible Individual” means an individual who is an Employee, Director, and/or Third-Party Service Provider.
2.19 “Employee” means any individual designated as an employee of the Company, its Affiliates, and/or its Subsidiaries on the payroll records thereof. An Employee shall not include any individual during any period he or she is classified or treated by the Company, an Affiliate, and/or a Subsidiary as an independent contractor, a consultant, or any employee of an employment, consulting, or temporary agency or any other entity other than the Company, an Affiliate, and/or a Subsidiary, without regard to whether such individual is subsequently determined to have been, or is subsequently retroactively reclassified as, a common-law employee of the Company, an Affiliate, and/or a Subsidiary during such period.
2.20 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor act thereto.
2.21 “Fair Market Value” or “FMV” means a price that is based on the opening, closing, actual, high, low, or average selling prices of a Share reported on the Nasdaq Stock Market (“Nasdaq”) or other
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| 108 |
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2024 PROXY STATEMENT |
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2016 LONG TERM INCENTIVE PLAN
established stock exchange (or exchanges) on the applicable date, the preceding trading day, the next succeeding trading day, or an average of trading days, as determined by the Committee in its discretion. Unless the Committee determines otherwise, Fair Market Value shall be deemed to be equal to the average of the opening and closing prices of a Share on the most recent date on which Shares were publicly traded. In the event Shares are not publicly traded at the time a determination of their value is required to be made hereunder, the determination of their Fair Market Value shall be made by the Committee in such manner as it deems appropriate. To the extent necessary for an Award to achieve its intended tax treatment under Code Section 409A, Fair Market Value will be determined in a manner permitted under Code Section 409A.
2.22 “First Restatement Date” has the meaning set forth in Section 1.1 (Establishment).
2.23 “Full-Value Award” means an Award other than an ISO, NQSO, or SAR, which is settled by the issuance of Shares.
2.24 “Grant Date” means the date an Award is granted to a Participant pursuant to the Plan.
2.25 “Grant Price” means the price established at the time of grant of an SAR pursuant to Article 7 (Stock Appreciation Rights), used to determine whether there is any payment due upon exercise of the SAR.
2.26 “Incentive Stock Option” or “ISO” means an Option to purchase Shares granted under Article 6 (Stock Options) to an Employee and that is designated as an Incentive Stock Option and that is intended to meet the requirements of Code Section 422, or any successor provision.
2.27 “Insider” shall mean an individual who is, on the relevant date, an officer or Director of the Company, or a more than ten percent (10%) Beneficial Owner of any class of the Company’s equity securities that is registered pursuant to Section 12 of the Exchange Act, as determined by the Board in accordance with Section 16 of the Exchange Act.
2.28 “New Nonemployee Director Award” means an Award for a Nonemployee Director of up to an additional fifteen thousand (30,000) Shares in the Plan Year in which an individual is first appointed or elected to the Board as a Nonemployee Director.
2.29 “Nonemployee Director” means a Director who is not an Employee.
2.30 “Nonemployee Director Award” means any NQSO, SAR, or Full-Value Award granted, whether singly, in combination, or in tandem, to a Participant who is a Nonemployee Director pursuant to such applicable terms, conditions, and limitations as the Board or Committee may establish in accordance with this Plan.
2.31 “Nonqualified Stock Option” or “NQSO” means an Option that is not intended to meet the requirements of Code Section 422, or that otherwise does not meet such requirements.
2.32 “Option” means an Incentive Stock Option or a Nonqualified Stock Option, as described in Article 6 (Stock Options).
2.33 “Option Price” means the price at which a Share may be purchased by a Participant pursuant to an Option.
2.34 “Other Stock-Based Award” means an equity-based or equity-related Award not otherwise described by the terms of this Plan, granted pursuant to Article 11 (Cash- Based Awards and Other Stock-Based Awards).
2.35 “Participant” means any Eligible Individual as set forth in Article 5 (Eligibility and Participation) to whom an Award is granted.
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2024 PROXY STATEMENT |
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109 |
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2016 LONG TERM INCENTIVE PLAN
2.36 “Performance Award” means an Award of a Performance Share, Performance Share Unit, Performance Unit, or other Award whose grant or vesting is based, in whole or in part, upon the achievement of one or more performance goals established by the Committee using one or more of the Performance Measures.
2.37 “Performance Measures” means measures as described in Article 13 (Performance Measures) on which the performance goals are based.
2.38 “Performance Period” means the period of time during which the performance goals must be met in order to determine the degree of payout and/or vesting with respect to an Award.
2.39 “Performance Share” means a grant of a stated number of Shares to a Participant under the Plan that is forfeitable by the Participant until the attainment of specified performance goals, or until otherwise determined by the Committee or in accordance with the Plan, subject to the continuous employment of the Participant through the applicable Performance Period.
2.40 “Performance Share Unit” means a Participant’s contractual right to receive a stated number of Shares, or if provided by the Committee on or after the grant date, cash equal to the Fair Market Value of such Shares, under the Plan at a specified time that are forfeitable by the Participant until the attainment of specified performance goals, or until otherwise determined by the Committee or in accordance with the Plan, subject to the continuous employment of the Participant through the applicable Performance Period.
2.41 “Performance Unit” means a Participant’s contractual right to receive a cash- denominated award, payable in cash or Shares, under the Plan at a specified time that is forfeitable by the Participant until the attainment of specified performance goals, or until otherwise determined by the Committee or in accordance with the Plan, subject to the continuous employment of the Participant through the applicable Performance Period.
2.42 “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof.
2.43 “Plan” means the Columbus McKinnon Corporation 2016 Long Term Incentive Plan, as amended, and restated from time-to-time.
2.44 “Plan Year” means the Company’s fiscal year, which currently begins April 1 and ends March 31.
2.45 “Prior Plans” means the Company’s 2010 Long Term Incentive Plan, the 2006 Long Term Incentive Plan, the 1995 Incentive Stock Option Plan, the Non-Qualified Stock Option Plan, the Restricted Stock Plan, and the 2014 Stock Incentive Plan of Magnetek, Inc.
2.46 “Restricted Stock” means an Award granted to a Participant pursuant to Article 8 (Restricted Stock and Restricted Stock Units).
2.47 “Restricted Stock Unit” means an Award granted to a Participant pursuant to Article 8 (Restricted Stock and Restricted Stock Units), except no Shares are actually awarded to the Participant on the Grant Date.
2.48 “Restriction Period” means the period when Restricted Stock, Restricted Stock Units, Deferred Stock Units, and/or Other Stock-Based Awards are subject to a substantial risk of forfeiture (based on the passage of time, the achievement of performance goals, or upon the occurrence of other events as determined by the Committee, in its discretion).
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2.49 “Retirement” shall be reached when a Participant’s status as an Employee terminates and at the time of such termination:1
(a) with respect to Awards with Grant Dates before April 1, 2021, the Participant’s age and years of service as an employee of the Company, an Affiliate, or any Subsidiary were either (i) age sixty-five (65) or older with at least five (5) years of service, or (ii) age sixty-two (62) or older with at least twenty-five (25) years of service, and
(b) with respect to Awards with Grant Dates on or after April 1, 2021, the Participant’s age plus years of service total to sixty-five (65) provided the Participant has attained age 55, completed five (5) years of service, and provides at least a 3-month notice prior to such termination.
2.50 “Second Restatement Date” has the meaning set forth in Section 1.1 (Establishment).
2.51 “Share” means a share of common stock of the Company, par value $.01 per share.
2.52 “Share Authorization” has the meaning set forth in Section 4.1(a) (Share Authorization).
2.53 “Stock Appreciation Right” or “SAR” means an Award, designated as an SAR, pursuant to the terms of Article 7 (Stock Appreciation Rights) herein.
2.54 “Subsidiary” means any corporation or other entity, whether domestic or foreign, in which the Company has or obtains, directly or indirectly, a proprietary interest of more than fifty percent (50%) by reason of stock ownership or otherwise.
2.55 “Tax Laws” has the meaning set forth in Section 24.19 (General Provisions/No Representations or Warranties Regarding Tax Affect).
2.56 “Ten-Percent Shareholder” means a person who, at the time an Option is granted, owns (or is treated as owning) stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any “parent corporation” or “subsidiary corporation“ (within the meaning of Code Section 424) of the Company.
2.57 “Third-Party Service Provider” means any consultant, agent, advisor, or independent contractor who renders services to the Company, a Subsidiary, or an Affiliate that (a) are not in connection with the offer and sale of the Company’s securities in a capital-raising transaction, and (b) do not directly or indirectly promote or maintain a market for the Company’s securities.
Article 3. Administration
3.1 General. The Committee shall be responsible for administering this Plan, subject to this Article 3 (Administration) and the other provisions of this Plan. The Committee may employ attorneys, consultants, accountants, agents, and other individuals, any of whom may be an Employee, and the Committee, the Company, and its officers and Directors shall be entitled to rely upon the advice, opinions, or valuations of any such individuals. All actions taken and all interpretations and determinations made by the Committee shall be final and binding upon the Participants, the Company, and all other interested individuals.
3.2 Authority of the Committee. The Committee shall have full and exclusive discretionary power to interpret the terms and the intent of this Plan and any Award Agreement or other agreement or document ancillary to or in connection with this Plan, to determine eligibility for Awards and to adopt such rules, regulations, forms, instruments, and guidelines for administering this Plan as the Committee may deem necessary or proper. Such authority shall include, but not be limited to, (a) selecting Award recipients, (b) establishing all Award terms and conditions, including
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the terms and conditions set forth in Award Agreements and any ancillary document or materials, (c) granting Awards as an alternative to or as the form of payment for grants or rights earned or due under compensation plans or arrangements of the Company, (d) construing any ambiguous provision of the Plan or any Award Agreement, (e) subject to Article 21 (Amendment, Modification, Suspension, and Termination), adopting modifications and amendments to this Plan or any Award Agreement, including without limitation, any that are necessary to comply with the laws of the countries and other jurisdictions in which the Company, its Affiliates, and/or its Subsidiaries operate, and (f) making any other determination and taking any other action that it deems necessary or desirable for the administration or operation of the Plan and/or any Award Agreement.
3.3 Delegation. The Committee may delegate to one or more of its members or to one or more officers of the Company, and/or its Subsidiaries and Affiliates, or to one or more agents or advisors such administrative duties or powers as it may deem advisable, and the Committee or any individuals to whom it has delegated duties or powers as aforesaid may employ one or more individuals to render advice with respect to any responsibility the Committee or such individuals may have under this Plan. The Committee may, by resolution, authorize one or more officers of the Company to do one or both of the following on the same basis as can the Committee: (a) designate Employees to be recipients of Awards; (b) designate Third-Party Service Providers to be recipients of Awards; and (c) determine the size of any such Awards; provided, however, (i) the Committee shall not delegate such responsibilities to any such officer for Awards granted to a Nonemployee Director or an Employee who is considered an Insider; (ii) the resolution providing such authorization sets forth the total number of Shares and/or Awards such officer(s) may grant; and (iii) the officer(s) shall report periodically to the Committee regarding the nature and scope of the Awards granted pursuant to the authority delegated.
Article 4. Shares Subject to This Plan and Maximum Awards
4.1 Number of Shares Available for Awards.
(a) Share Authorization.
Subject to adjustment as provided in Section 4.4 (Adjustments in Authorized Shares) herein, the maximum number of Shares available for issuance to Participants under this Plan (the “Share Authorization”) shall be:
(1) two million (2,000,000) Shares as of the Effective Date, plus
(2) an additional two million five hundred thousand (2,500,000) Shares as of the First Restatement Date, plus
(3) an additional two million eight hundred thousand (2,800,000) Shares as of the Second Restatement Date, plus
(4) any Shares subject to outstanding awards as of the Effective Date under the Prior Plans that on or after the Effective Date cease for any reason to be subject to such awards (other than by reason of exercise or settlement of the awards to the extent they are exercised for or settled in vested and non-forfeitable Shares) shall be added to the Share Authorization using the Share counts specified in Section 4.1(b) (Limit on Full Value Awards).
(b) Limit on Full Value Awards. To the extent that a Share is issued pursuant to the grant or exercise of a Full Value Award, it shall reduce the Share Authorization by two and one-tenth (2.1) Shares; and, to the extent that a Share is issued pursuant to the grant or
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exercise of an Award other than a Full Value Award, it shall reduce the Share Authorization by one (1) Share.
(c) Limits on ISOs. The maximum number of Shares of the Share Authorization that may be issued pursuant to ISOs under this Plan shall be two million (2,000,000) Shares as of the Effective Date, four million five hundred thousand (4,500,000) Shares as of the First Restatement Date, and seven million three hundred thousand (7,300,000) Shares as of the Second Restatement Date. Notwithstanding the foregoing, in no event shall the maximum number of Shares that may be issued pursuant to ISOs under the Plan exceed the available number of Shares under the Share Authorization.
(d) Limit on Nonemployee Director Awards. Subject to adjustment in Section 4.4 (Adjustments in Authorized Shares), the maximum number of Shares of the Share Authorization subject to Award(s) that may be issued to Nonemployee Directors during a single Fiscal Year, taken together with any cash compensation paid with respect to service as a member of the Board during such year (including service as a member or chair of any committee of the Board) during the Fiscal Year shall not exceed six hundred thousand dollars ($600,000) for a Director serving as the lead independent director or Chair of the Board, and shall not exceed four hundred thousand dollars ($400,000) for any other Nonemployee Director (calculating the value of any such Awards based on the grant date fair value of such Awards for financial reporting purposes), except that these annual limits on Nonemployee Director Awards shall be increased by the value of thirty thousand (30,000) Shares for an individual in the year first appointed or elected to the Board as a Nonemployee Director (the increase in value a “New Nonemployee Director Award”).
(e) Minimum Vesting Requirements for Awards. Except with respect to a maximum of five percent (5%) of the Share Authorization, Awards shall not provide for vesting which is any more rapid than over a period of at least twelve (12) months. Notwithstanding the foregoing, the Committee may permit acceleration of vesting of Awards in the event of the Participant’s death, Disability, or Retirement, or a Change in Control.
4.2 Share Usage. Shares covered by an Award shall only be counted as used to the extent they are actually issued. Any Shares related to Awards which terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of such Shares, are settled in cash in lieu of Shares, or are exchanged with the Committee’s permission, prior to the issuance of Shares, for Awards not involving Shares, shall be available again for grant under this Plan. However, the full number of Stock Appreciation Rights granted that are to be settled by the issuance of Shares shall be counted against the number of Shares available for award under the Plan, regardless of the number of Shares actually issued upon settlement of such Stock Appreciation Rights. Furthermore, any Shares withheld to satisfy tax withholding obligations on an Award issued under the Plan, Shares tendered to pay the exercise price of an Award under the Plan, and Shares repurchased on the open market with the proceeds of an Option exercise will no longer be eligible to be again available for grant under this Plan. To the extent permitted by applicable law or any stock exchange rule, Shares issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by the Company, a Subsidiary or any Affiliate shall not be counted against Shares available for grant pursuant to the Plan. The Shares available for issuance under this Plan may be authorized and unissued Shares or treasury Shares.
4.3 Annual Award Limits. The following limits (each an “Annual Award Limit” and, collectively, “Annual Award Limits”), as adjusted pursuant to Sections 4.4 (Adjustments in Authorized Shares)
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and/or 21.2 (Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events), shall apply to grants of such Awards under this Plan:
(a) Options and SARs: The maximum aggregate number of Shares subject to Options or SARs granted in any one Plan Year to any one Participant shall be four hundred thousand (400,000).
(b) Full-Value Awards: The maximum aggregate Award of Full-Value Awards that a Participant may receive in any one Plan Year shall be three hundred thousand (300,000) Shares, or equal to the value of three hundred thousand (300,000) Shares, determined as of the date of vesting or payout, as applicable.
(c) Cash-Based Awards: The maximum aggregate amount awarded or credited with respect to Cash-Based Awards to any one Participant in any one Plan Year may not exceed the greater of five million dollars ($5,000,000) or the value of three hundred thousand (300,000) Shares, determined as of the date of vesting or payout, as applicable.
4.4 Adjustments in Authorized Shares. In the event of any corporate event or transaction (including, but not limited to, a change in the Shares of the Company or the capitalization of the Company) such as a merger, consolidation, reorganization, recapitalization, separation, partial or complete liquidation, stock dividend, special cash dividend, stock split, reverse stock split, split up, spin-off, or other distribution of stock or property of the Company, combination of Shares, exchange of Shares, dividend in- kind, or other like change in capital structure, number of outstanding Shares or distribution (other than normal cash dividends) to shareholders of the Company, or any similar corporate event or transaction, the Committee, in order to prevent dilution or enlargement of Participants’ rights under this Plan, shall substitute or adjust, as applicable, the number and kind of Shares that may be issued under this Plan or under particular forms of Awards, the number and kind of Shares subject to outstanding Awards, the Option Price or Grant Price applicable to outstanding Awards, the Annual Award Limits, and other value determinations applicable to outstanding Awards. The Committee, in its sole discretion, may also make appropriate adjustments in the terms of any Awards under this Plan to reflect such changes or distributions, including modifications of performance goals and changes in the length of Performance Periods.
The determination of the Committee as to the foregoing adjustments, if any, shall be at the discretion of the Committee and shall be conclusive and binding on the Participants, the Company, and all other interested individuals.
Subject to the provisions of Article 21 (Amendment, Modification, Suspension, and Termination) and notwithstanding anything else herein to the contrary, without affecting the number of Shares reserved or available hereunder, the Committee may authorize the issuance or assumption of benefits under this Plan in connection with any merger, consolidation, acquisition of property or stock, or reorganization upon such terms and conditions as it may deem appropriate (including, but not limited to, a conversion of equity awards into Awards under this Plan), subject to compliance with the rules under Code Sections 409A, 422, and 424, as and where applicable.
Article 5. Eligibility and Participation
5.1 Eligibility. Individuals eligible to participate in this Plan include all Employees, Directors, and Third-Party Service Providers.
5.2 Actual Participation. Subject to the provisions of this Plan, the Committee may, from time to time, select from the Eligible Individuals those individuals to whom Awards shall be granted.
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Subject to any governing rules or regulations, as soon as practicable after receipt of written notification of exercise and full payment (including satisfaction of any applicable tax withholding), the Company shall deliver to the Participant evidence of book entry Shares, or upon the Participant’s request, Share certificates in an appropriate amount based upon the number of Shares purchased under the Option(s).
Unless otherwise determined by the Committee, all payments under all of the methods indicated above shall be paid in United States dollars.
6.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant to the exercise of an Option granted under this Article 6 (Stock Options) as it may deem advisable, including, without limitation, minimum holding period requirements, restrictions under applicable federal securities laws, under the requirements of any stock exchange or market upon which such Shares are then listed and/or traded, or under any blue sky or state securities laws applicable to such Shares.
6.8 Blackout Periods. If there is a blackout period under the Company’s insider trading policy, applicable law, or a Board- or Committee-imposed blackout period that prohibits the buying and selling of Shares during any part of the ten-day period before the expiration of any Option based on the termination of a Participant’s service, the period for exercising the Options shall be extended until thirty (30) days beyond when such blackout period ends. Notwithstanding any provision hereof or within an Award Agreement, no Option shall ever be exercisable after the expiration of its original term as set forth in the Award Agreement and/or this Plan.
6.9 Notification of Disqualifying Disposition. If any Participant shall make any disposition of Shares issued pursuant to the exercise of an ISO under the circumstances described in Code Section 421(b) (relating to certain disqualifying dispositions), such Participant shall notify the Company of such disposition within ten (10) days thereof.
Article 7. Stock Appreciation Rights
7.1 Grant of SARs. Subject to the terms and conditions of this Plan, SARs may be granted to Eligible Participants at any time and from time to time as shall be determined by the Committee. An Eligible Individual who is employed or engaged by an Affiliate and/or Subsidiary may only be granted SARs to the extent the Company represents an “eligible issuer of service recipient stock” (within the meaning of Treas. Reg. 1.409A-1(b)(5)(iii)(E)(1)) with respect to the Eligible Individual.
Subject to the terms and conditions of this Plan, the Committee shall have complete discretion in determining the number of SARs granted to each Participant and, consistent with the provisions of this Plan, in determining the terms and conditions pertaining to such SARs.
The Grant Price for each grant of an SAR shall be determined by the Committee and shall be specified in the Award Agreement; provided, however, the Grant Price on the Grant Date must be at least equal to one hundred percent (100%) of the FMV of a Share as determined on the Grant Date, except that the Grant Price may be less than one hundred percent (100%) of the FMV of a Share as of the Grant Date where an SAR is being granted in substitution for a prior stock appreciation right in connection with a merger, consolidation, acquisition of property or stock, or reorganization and the substitution complies with Code Section 409A.
7.2 SAR Agreement. Each SAR Award shall be evidenced by an Award Agreement that shall specify the Grant Price, the term of the SAR, and such other provisions as the Committee shall determine.
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7.3 Term of SAR. The term of an SAR granted under this Plan shall be determined by the Committee, in its sole discretion, and except as determined otherwise by the Committee and specified in the SAR Award Agreement, no SAR shall be exercisable later than the tenth (10th) anniversary of its Grant Date.
7.4 Exercise of SARs. SARs may be exercised upon whatever terms and conditions the Committee, in its sole discretion, imposes. All SARs will be exercised automatically on the last trading day prior to the expiration date of the SAR or, in the case of SARs granted in tandem with Options, any related Option, so long as the Fair Market Value of a Share on that date exceed the Grant Price of the SAR or the Option Price of any related Option, as applicable. If the Fair Market Value of a Share on the last trading day prior to the expiration date of a SAR or, in the case of SARs granted in tandem with Options, any related Option, is less than or equal to the Grant Price of the SAR or the Option Price of any related Option, as applicable, then the SAR and any tandem Option shall be automatically cancelled for no consideration upon the expiration date for such SAR and any tandem Option.
7.5 Settlement of SARs. Upon the exercise of an SAR, a Participant shall be entitled to receive payment from the Company in an amount determined by multiplying:
(a) The excess of the Fair Market Value of a Share on the date of exercise over the Grant Price; by
(b) The number of Shares with respect to which the SAR is exercised.
At the discretion of the Committee, the payment upon SAR exercise may be in cash, Shares, or any combination thereof, or in any other manner approved by the Committee in its sole discretion. The Committee’s determination regarding the form of SAR payout shall be set forth in the Award Agreement pertaining to the grant of the SAR.
7.6 Other Restrictions. The Committee shall impose such other conditions and/or restrictions on any Shares received upon exercise of an SAR granted pursuant to this Plan as it may deem advisable or desirable. These restrictions may include, but shall not be limited to, a requirement that the Participant hold the Shares received upon exercise of an SAR for a specified period of time.
Article 8. Restricted Stock and Restricted Stock Units
8.1 Grant of Restricted Stock or Restricted Stock Units. Subject to the terms and provisions of this Plan, the Committee, at any time and from time to time, may grant Shares of Restricted Stock and/or Restricted Stock Units to Eligible Individuals in such amounts as the Committee shall determine. Restricted Stock Units shall be similar to Restricted Stock except that no Shares are actually awarded to the Eligible Individual on the Grant Date.
8.2 Restricted Stock or Restricted Stock Unit Agreement. Each Restricted Stock and/or Restricted Stock Unit grant shall be evidenced by an Award Agreement that shall specify the Restriction Period, the number of Shares of Restricted Stock or the number of Restricted Stock Units granted, and such other provisions as the Committee shall determine.
8.3 Other Restrictions. The Committee shall impose such other conditions and/or restrictions on any Shares of Restricted Stock or Restricted Stock Units granted pursuant to this Plan as it may deem advisable, including, without limitation, a requirement that Participants pay a stipulated purchase price for each Share of Restricted Stock or each Restricted Stock Unit, restrictions based upon the achievement of specific performance goals, time-based restrictions on vesting following the attainment of the performance goals, time-based restrictions, and/or restrictions under
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applicable laws or under the requirements of any stock exchange or market upon which such Shares are listed or traded, or holding requirements or sale restrictions placed on the Shares by the Company upon vesting of such Restricted Stock or Restricted Stock Units.
To the extent deemed appropriate by the Committee, the Company may retain the certificates representing Shares of Restricted Stock in the Company’s possession until such time as all conditions and/or restrictions applicable to such Shares have been satisfied or lapse.
Except as otherwise provided in this Article 8 (Restricted Stock and Restricted Stock Units), Shares of Restricted Stock covered by each Restricted Stock Award shall become freely transferable by the Participant after all conditions and restrictions applicable to such Shares have been satisfied or lapse (including satisfaction of any applicable tax withholding obligations), and Restricted Stock Units shall be settled in cash, Shares, or a combination of cash and Shares as the Committee, in its sole discretion, shall determine.
8.4 Certificate Legend. In addition to any legends placed on certificates pursuant to Section 8.3 (Other Restrictions), each certificate representing Shares of Restricted Stock granted pursuant to this Plan may bear a legend such as the following or as otherwise determined by the Committee in its sole discretion:
“The sale or transfer of Shares of stock represented by this certificate, whether voluntary, involuntary, or by operation of law, is subject to certain restrictions on transfer as set forth in the Columbus McKinnon Corporation 2016 Long Term Incentive Plan, as amended from time-to-time, and in the associated Award Agreement. A copy of this Plan and such Award Agreement may be obtained from Columbus McKinnon Corporation.”
8.5 Voting Rights. Unless otherwise determined by the Committee and set forth in a Participant’s Award Agreement, to the extent permitted or required by law, as determined by the Committee, Participants holding Shares of Restricted Stock granted hereunder may be granted the right to exercise full voting rights with respect to those Shares during the Restriction Period. A Participant shall have no voting rights with respect to any Restricted Stock Units granted hereunder.
8.6 Section 83(b) Election. The Committee may provide in an Award Agreement that the Award of Restricted Stock is conditioned upon the Participant making or refraining from making an election with respect to the Award under Code Section 83(b). If a Participant makes an election pursuant to Code Section 83(b) concerning a Restricted Stock Award, the Participant shall be required to (i) file promptly a copy of such election with the Company, and (ii) make arrangements satisfactory to the Company in its sole discretion for the timely satisfaction of any taxes required to be withheld by the Company, an Affiliate or any Subsidiary as a result of the Participant making an election pursuant to Code Section 83(b), provided that any Shares subject to the Restricted Stock Award for which the Restriction Period has not lapsed may not be used to satisfy any applicable tax withholding.
Article 9. Deferred Stock Units
9.1 In General. Deferred Stock Units may be granted to Eligible Individuals at such time or times as shall be determined by the Committee without regard to any election by the Participant to defer receipt of any compensation or bonus amount payable to him or her. In addition, on fixed dates established by the Committee and subject to such terms and conditions as the Committee shall determine, the Committee may permit a Participant to elect to defer receipt of all or a portion of his or her annual compensation, annual incentive bonus and/or long-term compensation (other than Options or SARs) (“Deferred Annual Amount”) payable by the Company or a Subsidiary and receive in lieu thereof an Award of elective Deferred Stock Units equal to the number which may be
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Participant’s employment with or service to the Company, Affiliates, and the Subsidiaries for Cause, the Participant shall immediately forfeit all rights with respect to any shares of Deferred Stock Units (and related Dividend Equivalent Rights) credited to his or her account, whether or not the Restriction Period shall have then lapsed. Subject to Articles 14 (Transferability of Awards), 20 (Change in Control), and 24 (General Provisions), and the last sentence of Section 9.1 (In General), unless the Committee determines otherwise at or after the Grant Date, the Company shall issue the Shares underlying any of a Participant’s Elective Deferred Stock Units (and related Dividend Equivalent Rights) credited to such Participant’s account under the Plan as soon as administratively practicable, but not later than two and one-half (21⁄2) months following the date of such Participant’s termination of employment or service (or such later date as may be elected by the Participant in accordance with the rules and procedures of the Committee). The Committee may provide in the Award Agreement applicable to any Award of Deferred Stock Units that, in lieu of issuing Shares in settlement of any Deferred Stock Units, the Committee may direct the Company to pay to the Participant the Fair Market Value of the Shares corresponding to such Deferred Stock Units in cash. For each Share received in settlement of Deferred Stock Units, the Company shall deliver to the Participant a certificate representing such Share, bearing appropriate legends, if applicable.
Notwithstanding anything to the contrary in this Section 9.4 (Settlement), the Committee may, subject to compliance with Code Section 409A, accelerate the distribution of any and all Shares subject to any Award of Deferred Stock Units prior to the time otherwise specified in this Section 9.4 (Settlement).
9.5 Further Deferral Elections. A Participant may elect to further defer receipt of Shares issuable in respect of Deferred Stock Units (or an installment of an Award) for a specified period or until a specified event, subject in each case to the Committee’s approval and to such terms as are determined by the Committee, all in its sole discretion, in accordance with Section 24.13(c)(iii) (Subsequent Deferral Elections).
Article 10. Performance Shares, Performance Share Units, and Performance Units
10.1 Grant of Performance Shares, Performance Share Units, and Performance Units. Subject to the terms and provisions of this Plan, the Committee, at any time and from time to time, may grant Performance Shares, Performance Share Units, and/or Performance Units to Eligible Individuals in such amounts and upon such terms as the Committee shall determine.
10.2 Value of Performance Shares, Performance Share Units, and Performance Units. Each Performance Share and each Performance Share Unit shall have an initial value equal to the Fair Market Value of a Share on the Grant Date. Each Performance Unit shall have an initial value that is established by the Committee at the time of grant. The Committee shall set performance goals in its discretion which, depending on the extent to which they are met, will determine the value and/or number of Performance Shares, Performance Share Units, and/or Performance Units that will be paid out to the Participant.
10.3 Earning of Performance Shares, Performance Share Units, and Performance Units. Subject to the terms of this Plan, after the applicable Performance Period has ended, the holder of Performance Shares, Performance Share Units, and/or Performance Units shall be entitled to receive payout on the value and number of Performance Shares, Performance Share Units, and/or Performance Units earned by the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding performance goals have been achieved.
10.4 Form and Timing of Payment of Performance Shares, Performance Share Units, and Performance Units. Payment of earned Performance Shares, Performance Share Units, and/or
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Performance Units shall be as determined by the Committee and as evidenced in the Award Agreement. Subject to the terms of this Plan, the Committee, in its sole discretion, may pay earned Performance Shares, Performance Share Units, and/or Performance Units in the form of cash or in Shares (or in a combination thereof) equal to the value of the earned Performance Shares, Performance Share Units, and/or Performance Units at the close of the applicable Performance Period, but no later than the fifteenth (15th) day of the third (3rd) month after the year in which the Performance Period ended. Any Shares may be granted subject to any restrictions deemed appropriate by the Committee. The determination of the Committee with respect to the form of payout of such Awards shall be set forth in the Award Agreement pertaining to the grant of the Award.
Article 11. Cash-Based Awards and Other Stock-Based Awards
11.1 Grant of Cash-Based Awards. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Cash-Based Awards to Eligible Individuals in such amounts and upon such terms as the Committee may determine.
11.2 Other Stock-Based Awards. The Committee may grant to Eligible Individuals other types of equity-based or equity-related Awards not otherwise described by the terms of this Plan (including the grant or offer for sale of unrestricted Shares) in such amounts and subject to such terms and conditions as the Committee shall determine. Such Awards may involve the transfer of actual Shares to Participants, or payment in cash or otherwise of amounts based on the value of Shares and may include, without limitation, Awards designed to comply with or take advantage of the applicable local laws of jurisdictions other than the United States.
11.3 Value of Cash-Based and Other Stock-Based Awards. Each Cash-Based Award shall specify a payment amount or payment range as determined by the Committee. Each Other Stock-Based Award shall be expressed in terms of Shares or units based on Shares, as determined by the Committee. The Committee may establish performance goals in its discretion. If the Committee exercises its discretion to establish performance goals, the number and/or value of Cash-Based Awards or Other Stock-Based Awards that will be paid out to the Participant will depend on the extent to which the performance goals are met.
11.4 Payment of Cash-Based Awards and Other Stock-Based Awards. Payment, if any, with respect to a Cash-Based Award or an Other Stock-Based Award shall be made in accordance with the terms of the Award, in cash or Shares as the Committee determines. The Company may pay earned Cash-Based Awards and Other Stock-Based Awards in the form of cash or in Shares (or in a combination thereof) equal to the value of the earned Award at the close of the applicable Performance Period, if any, but no later than the fifteenth (15th) day of the third (3rd) month after the year in which the Performance Period ended, the award vests (unless a valid deferral election has been made), or the payment was otherwise scheduled to be made.
Article 12. Nonemployee Director Awards
Nonemployee Directors may only be granted Awards under the Plan in accordance with this Article 12 (Nonemployee Director Awards) and which shall not be subject to management’s discretion. From time to time, the Board shall set the amount(s) and type(s) of equity awards that shall be granted to all Nonemployee Directors on a periodic, nondiscriminatory basis pursuant to the Plan, as well as any additional amount(s), if any, to be awarded, also on a periodic, nondiscriminatory basis, based on each of the following: the number of committees of the Board on which a Nonemployee Director serves, service of a Nonemployee Director as the chair of a committee of the
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Board, service of a Nonemployee Director as Chair of the Board or lead independent director, or the first selection or appointment of an individual to the Board as a Nonemployee Director. Subject to the limits set forth in Section 4.1(d) (Limit on Nonemployee Director Awards) and the foregoing, the Board shall grant such Awards to Nonemployee Directors and any Nonemployee Chair of the Board or lead independent director, and grant New Nonemployee Director Awards, as it shall from time to time determine.
If a Nonemployee Director subsequently becomes an Employee while remaining a member of the Board, any Award held by such individual at the time of such commencement of employment will not be affected thereby.
Nonemployee Directors, pursuant to this Article 12 (Nonemployee Director Awards), may be awarded, or may be permitted to elect to receive, pursuant to the procedures established by the Board or a committee of the Board, all or any portion of their annual retainer, meeting fees, or other fees in Shares, Restricted Stock, Restricted Stock Units, Deferred Stock Units, or other Awards as contemplated by this Plan in lieu of cash.
Article 13. Performance Measures
13.1 In General. The performance goals upon which the payment or vesting of an Award that is intended to be a Performance Award shall be based on one or more of the following Performance Measures:
(a) Net earnings or net income (before or after taxes);
(b) Operating earnings or income;
(c) Earnings or diluted earnings per share;
(d) Net sales or revenue growth;
(e) Net operating profit;
(f) Return measures (including, but not limited to, return on assets, net assets, capital, investment, invested capital, equity, shareholders’ equity sales, or revenue);
(g) Cash flow (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity, cash flow return on capital, and cash flow return on investment);
(h) Earnings before or after taxes, interest, depreciation, and/or amortization;
(i) Gross or operating margins;
(j) Productivity ratios;
(k) Share price (including, but not limited to, growth measures and total shareholder return);
(l) Expense targets;
(m) Debt reduction;
(n) Cost reduction or savings;
(o) Margins;
(p) Operating efficiency;
(q) Market share;
(r) Customer and/or employee satisfaction;
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(s) Safety;
(t) Working capital targets and change in working capital;
(u) Economic value added or EVA® (net operating profit after tax minus the sum of capital multiplied by the cost of capital);
(v) Strategic goals and objectives, including objectives related to qualitative or quantitative environmental, social and governance metrics; and
(w) Such other business, financial or other metrics as the Committee shall determine from time to time.
Any Performance Measure(s) may be used to measure the performance of the Company, Subsidiary, and/or Affiliate as a whole or any business unit of the Company, Subsidiary, and/or Affiliate or any combination thereof, as the Committee may deem appropriate, or any of the above Performance Measures as compared to the performance of a group of comparator companies, or published or special index that the Committee, in its sole discretion, deems appropriate, or the Company may select Performance Measure (k) above as compared to various stock market indices. The Committee also has the authority to provide for accelerated vesting of any Award based on the achievement of performance goals pursuant to the Performance Measures specified in this Article 13 (Performance Measures).
13.2 Evaluation of Performance. In the evaluation of performance, the Committee may include or exclude any of the following events that occurs during a Performance Period: (a) asset write-downs, (b) litigation or claim judgments or settlements, (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and restructuring programs, (e) unusual and infrequently occurring items as described in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to shareholders for the applicable year, (f) acquisitions or divestitures, and (g) foreign exchange gains and losses.
13.3 Committee Discretion. The Committee shall retain the discretion to adjust Performance Awards, either on a formula or discretionary basis or any combination, as the Committee determines.
Article 14. Transferability of Awards
14.1 In General. Except as provided in Section 14.2 (Committee Action) below, during a Participant’s lifetime, his or her Awards shall be exercisable only by the Participant. Awards shall not be transferable other than by will or the laws of descent and distribution; no Awards shall be subject, in whole or in part, to attachment, execution, or levy of any kind; and any purported transfer in violation hereof shall be null, void and of no effect.
14.2 Committee Action. The Committee may, in its sole discretion, determine that notwithstanding Section 14.1 (In General), any or all Awards (other than ISOs) shall be transferable to and exercisable by such transferees, and subject to such terms and conditions, as the Committee may deem appropriate; provided, however, no Award may be transferred for value (as defined in the General Instructions to Form S-8).
Article 15. Impact of Termination of Employment/Service on Awards
15.1 In General. Unless otherwise determined by the Committee and set forth in the Award Agreement, upon the termination of a Participant’s employment or service with the Company,
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Affiliate, and/or Subsidiary,2 for any reason whatsoever, except as otherwise set forth in this Article 15 (Impact of Termination of Employment/Service on Awards), in an Award Agreement or, with the consent of such individual, as determined by the Committee at any time prior to or after such termination, Awards granted to such Participant will be treated as follows:
(a) Any Options and SARs will (i) to the extent not vested and exercisable as of the date of such termination of employment or of service with the Company, Affiliate, and/or Subsidiary, terminate on the date of such termination, and (ii) to the extent vested and exercisable as of the date of such termination of employment or of service with the Company, Affiliate, and/or Subsidiary, remain exercisable for a period of thirty (30) days following the later of the date of such termination or the last day date of any blackout period, or, in the event of the Participant’s death during such thirty (30) day period, remain exercisable by the estate of the deceased Participant until the end of the period of one (1) year following the date of such termination (but in no event beyond the maximum term of such Award).
(b) Any unvested portion of any Restricted Stock, Restricted Stock Units, or Deferred Stock Units will be immediately forfeited.
(c) Any outstanding Performance Shares, Performance Share Units, or Performance Units will be immediately forfeited and terminate.
(d) Any other Awards, including, but not limited to, Cash-Based Awards and Other Stock-Based Awards, to the extent not vested will be immediately forfeited and terminate.
15.2 Upon Death or Disability. Except as otherwise provided in an Award Agreement, in the event of a termination of a Participant’s employment with the Company, Affiliate, and/or Subsidiary or a termination of a Participant’s service on the Board as a result of the Participant’s death or Disability, Awards granted to such Participant will be treated as follows:
(a) Any Options and SARs shall become immediately exercisable as of the date of such termination of employment or service, and the Participant, or in the event the Participant is incapacitated and unable to exercise the rights granted hereunder, the Participant’s legal guardian or legal representative, or in the event the Participant dies, the estate of the Participant, shall have the right to exercise any rights the Participant would otherwise have had under the Plan for a period of one (1) year after the date of such termination (but in no event beyond the maximum term of the Award).
(b) Any unvested portion of any Restricted Stock, Restricted Stock Units, or Deferred Stock Units will become immediately vested.
(c) Any Performance Shares, Performance Share Units, or Performance Units will remain outstanding and the Participant or the Participant’s estate will be entitled to the payment of the Award earned (based on the actual performance achieved during the applicable Performance Period), which will be paid on the date the Award would have been paid if the Participant had remained employed with or continued to provide service to the Company, Affiliate, or Subsidiary.
15.3 Upon Retirement. Except as otherwise provided in an Award Agreement, in the event a Participant’s status as an Employee terminates by reason of the Participant’s Retirement, Awards granted to such Participant will be treated as follows:
(a) With respect to any Options and SARs—
(1) Except as provided in Section 15.3(a)(2) concerning grants made in the year of retirement, the Options or SARs shall remain outstanding and (i) to the extent not then fully
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vested, will continue to vest in accordance with the applicable vesting schedule, and (ii) the Participant shall have the right to exercise any rights the Participant would otherwise have had under the Plan until the sooner to occur of (a) the expiration of the term of the Option or SAR or (b) the fifth (5th) anniversary of the date of termination. Notwithstanding the foregoing, in the event a Participant does not exercise an Incentive Stock Option prior to the expiration of the three (3) month period after the date of the Participant’s Retirement, such Option shall be treated as a Nonqualified Stock Option upon exercise.
(2) In the case of Options or SARs granted after March 31, 2021, the number of Options or SARs granted to the Participant with respect to the Fiscal Year in which the Participant retires shall be reduced pro rata so that the final number shall be determined by multiplying the original number granted by a fraction where the numerator is the number of whole calendar months during the Fiscal Year preceding the Participant’s Retirement and the denominator is twelve (12). The Options or SARs remaining after such reduction shall vest and be subject to exercise as provided in Section 15.3(a)(l).
(b) Any unvested portion of any Restricted Stock, Restricted Stock Units, or Deferred Stock Units will become immediately vested provided, however, in the case of Awards granted after March 31, 2021, the number of shares of Restricted Stock or Restricted Stock Units granted to the Participant with respect to the Fiscal Year in which the Participant retires shall be reduced pro rata so that the final number shall be determined by multiplying the original number granted by a fraction where the numerator is the number of whole calendar months during the Fiscal Year preceding the Participant’s Retirement and the denominator is twelve (12).
(c) Any Performance Shares, Performance Share Units, or Performance Units will remain outstanding and the Participant will be entitled to the payment of the Award earned (based on the actual performance achieved during the applicable Performance Period), which will be paid on the date the Award would have been paid if the Participant had remained employed with or continued to provide service to the Company, Affiliate, or Subsidiary provided, however, in the case of Awards granted after March 31, 2021, the number of such Performance Shares, Performance Share Units or Performance Units granted to the Participant with respect to the Fiscal Year in which the Participant retires, as adjusted by the appropriate performance percentage, shall be reduced pro rata so that the final number shall be determined by multiplying the original number granted by a fraction where the numerator is the number of whole calendar months during the Fiscal Year preceding the Participant’s Retirement and the denominator is twelve (12).
15.4 For Cause. Except as otherwise provided in an Award Agreement, in the event a Participant’s employment or service with the Company, Affiliate, and/or Subsidiary is terminated for Cause, Awards granted to such Participant will be treated as follows:
(a) Any Options and SARs, whether vested or unvested, will be immediately forfeited and terminate.
(b) Any outstanding Restricted Stock, Restricted Stock Unit, or Deferred Stock Unit Awards will be immediately forfeited and terminate.
(c) Any outstanding Performance Shares, Performance Share Units, or Performance Units will be immediately forfeited and terminate.
(d) Any other outstanding Awards will be immediately forfeited and terminate.
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15.5 Upon Termination of Employment in Connection with a Change in Control. Except as otherwise provided in an Award Agreement, upon a termination in connection with a Change in Control, Awards granted to a Participant will be treated as set forth in Article 20 (Change in Control).
15.6 Bona Fide Leave. Notwithstanding the fact that a Participant’s employment ostensibly terminates and except as otherwise provided in an Award Agreement, if the Participant is on a bona fide leave of absence, as defined in Treas. Reg. 1.409A-1(h)(1), then the Participant will be treated as having a continuing employment relationship (and not as having terminated employment for purposes of this Plan) so long as the period of the leave does not exceed six (6) months, or if longer, so long as the Participant retains a right to reemployment with the Company, Subsidiary, and/or Affiliate under an applicable statute or by contract.
Article 16. Substitution Awards
Awards may be granted under the Plan from time to time in substitution for stock options and other awards held by employees or directors of other entities who are about to become Employees, whose employer is about to become an Affiliate as the result of a merger or consolidation of the Company with another corporation, or the acquisition by the Company of substantially all the assets of another corporation, or the acquisition by the Company of more than fifty percent (50%) of the issued and outstanding stock of another corporation as the result of which such other corporation will become a Subsidiary. The terms and conditions of the substitute Awards so granted may vary from the terms and conditions set forth in the Plan to such extent as the Board at the time of grant may deem appropriate to conform, in whole or in part, to the provisions of the award in substitution for which they are granted. If Shares are issued under the Plan with respect to an Award granted under this Article such Shares will not count against the Share Authorization to the maximum extent permitted by applicable law and any stock exchange rules.
Article 17. Dividend Equivalent Rights
Any Participant selected by the Committee may be granted Dividend Equivalent Rights based on the dividends declared on Shares that are subject to any Award, to be credited as of dividend payment dates, during the period between the Grant Date and the date the Award is exercised, vests, settles or expires, as determined by the Committee. Such Dividend Equivalent Rights shall be converted to cash or additional Shares by such formula and at such time and subject to such limitations as may be determined by the Committee. Notwithstanding the foregoing, Dividend Equivalent Rights shall accrue and only be paid to the extent an Award becomes vested. Under no circumstances may Dividend Equivalent Rights be granted for any Option or SAR.
Article 18. Beneficiary Designation
Each Participant under this Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under this Plan is to be paid in case of his or her death before he or she receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Committee, and will be effective only when filed by the Participant in writing with the Company during the Participant’s lifetime. In the absence of any such beneficiary designation, benefits remaining unpaid or rights remaining unexercised at the Participant’s death shall be paid to or exercised by the Participant’s executor, administrator, or legal representative.
Article 19. Rights of Participants
19.1 Employment/Service. Nothing in this Plan or an Award Agreement shall interfere with or limit in any way the right of the Company, its Affiliates, and/or its Subsidiaries to terminate any
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Participant’s employment or service at any time and for any reason not prohibited by law, nor confer upon any Participant any right to continue his employment or service with the Company, its Affiliates, and/or its Subsidiaries for any specified period of time.
Neither an Award nor any benefits arising under this Plan shall constitute an employment contract with the Company, its Affiliates, and/or its Subsidiaries and, accordingly, subject to Articles 3 (Administration) and 21 (Amendment, Modification, Suspension, and Termination), this Plan and the benefits hereunder may be terminated at any time in the sole and exclusive discretion of the Committee without giving rise to any liability on the part of the Company, its Affiliates, and/or its Subsidiaries.
19.2 Participation. No individual shall have the right to be selected to receive an Award under this Plan, or having been so selected, to be selected to receive a future Award.
19.3 Rights as a Shareholder. Except as otherwise provided herein, a Participant shall have none of the rights of a shareholder with respect to Shares covered by any Award until the Participant becomes the record holder of such Shares.
Article 20. Change in Control
Unless the Committee otherwise determines and sets forth in an Award Agreement, upon the occurrence of a Change in Control, Awards shall have their vesting and payment accelerated based on a “double trigger” which shall require the occurrence of a Change in Control coupled with the termination of the Participant’s employment or service to the Company, Subsidiary, or Affiliate within two (2) years of the occurrence of such Change in Control, or such other events as the Committee may decide, with the specific details of the treatment of Awards as determined by the Committee, in its sole discretion, and set forth in the Award Agreement at the time of grant.
Article 21. Amendment, Modification, Suspension, and Termination
21.1 In General. Subject to Sections 21.3 (Awards Previously Granted) and 21.5 (Repricing Prohibition), the Committee may, at any time and from time to time, alter, amend, modify, suspend, or terminate this Plan and/or any Award Agreement in whole or in part; provided, however, that no material amendment of this Plan shall be made without shareholder approval if shareholder approval is required by law, regulation, or stock exchange rule.
21.2 Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events. The Committee may make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (other than those described in Section 4.4 (Adjustments in Authorized Shares) hereof) affecting the Company or the financial statements of the Company or of changes in applicable laws, regulations, or accounting principles whenever the Committee determines that such adjustments are appropriate in order to prevent unintended dilution or enlargement of the benefits or potential benefits intended to be made available under this Plan. The determination of the Committee as to the foregoing adjustments, if any, shall be conclusive and binding on the Participants, the Company, and all other interested individuals.
21.3 Awards Previously Granted. Notwithstanding any other provision of this Plan to the contrary (other than Section 21.4 (Amendment to Conform to Law)), no termination, amendment, suspension, or modification of this Plan or an Award Agreement shall adversely affect in any material way any Award previously granted under this Plan without the written consent of the Participant holding such Award.
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21.4 Amendment to Conform to Law. Notwithstanding any other provision of this Plan to the contrary, the Board may amend the Plan or an Award Agreement, to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the Plan or an Award Agreement to any present or future law relating to plans of this or similar nature (including, but not limited to, Code Section 409A), and to the administrative regulations and rulings promulgated thereunder. By accepting an Award under this Plan, a Participant agrees to any amendment made pursuant to this Section 21.4 (Amendment to Conform to Law) to any Award granted under the Plan without further consideration or action.
21.5 Repricing Prohibition. Except to the extent (a) approved in advance by holders of a majority of the Shares of the Company entitled to vote generally in the election of Directors or (b) provided in Section 4.4 (Adjustments in Authorized Shares), the Committee shall not have the power or authority to reduce, whether through amendment or otherwise, the Option Price or the Grant Price of any outstanding Option or SAR or to grant any new Award, or make any cash payment, in substitution for or upon the cancellation of Options or SARs previously granted.
Article 22. Withholding
22.1 Tax Withholding. The Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount up to (and including) the maximum statutory amount to satisfy federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan, as the Company shall determine or permit in its sole discretion.
22.2 Share Withholding. With respect to withholding required upon the exercise of Options or SARs, upon the lapse of restrictions on Restricted Stock and Restricted Stock Units, or upon the achievement of performance goals related to Performance Shares, or any other taxable event arising as a result of an Award granted hereunder, Participants may elect, subject to the approval of the Committee, to satisfy the withholding requirement, in whole or in part, by having the Company withhold Shares having a Fair Market Value on the date the tax is to be determined to have a value of up to (and including) the maximum statutory total tax that could be imposed on the transaction, as the Company shall determine or permit in its sole discretion. All such elections shall be irrevocable, made in writing, and signed by the Participant, and shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.
Article 23. Successors
All obligations of the Company under this Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.
Article 24. General Provisions
24.1 Forfeiture Events.
(a) The Committee may specify in an Award Agreement that the Participant’s rights, payments, and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture, or recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, but shall not be limited to, termination of employment for Cause, termination of the Participant’s provision of services to the Company, Affiliate, and/or Subsidiary, violation of material Company, Affiliate, and/or Subsidiary policies, breach of noncompetition,
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confidentiality, or other restrictive covenants that may apply to the Participant, or other conduct by the Participant that is detrimental to the business or reputation of the Company, its Affiliates, and/or its Subsidiaries.
(b) The Awards granted under this Plan and any cash payment or Shares delivered pursuant to such an Award are subject to forfeiture, recovery by the Company or other action pursuant to the applicable Award Agreement or any clawback or recoupment policy which the Company may adopt from time to time, including, without limitation, the Company’s Clawback Policy, as adopted by the Board on July 23, 2023, as may be amended from time to time, and any such other policy which the Company has adopted to comply with the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules and regulations thereunder, or as otherwise specified by law.
24.2 Legend. The certificates for Shares may include any legend which the Committee deems appropriate to reflect any restrictions on transfer of such Shares.
24.3 Gender and Number. Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine, the singular shall include the plural, and the plural shall include the singular.
24.4 Severability. In the event that any one or more of the provisions of this Plan shall be or become invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not be affected thereby. If, in the opinion of any court of competent jurisdiction, such covenants are not reasonable in any respect, such court shall have the right, power, and authority to excise or modify such provision or provisions of these covenants as to the court shall appear not reasonable and to enforce the remainder of these covenants as so amended.
24.5 Compliance with Legal and Exchange Requirements. The Plan, the granting and exercising of Awards thereunder, and any obligations of the Company under the Plan shall be subject to all applicable federal and state laws, rules, and regulations, and to such approvals by any regulatory or governmental agency as may be required, and to any rules or regulations of any stock exchange on which the Shares are listed. The Company, in its discretion, may postpone the granting and exercising of Awards, the issuance or delivery of Shares under any Award, or any other action permitted under the Plan to permit the Company, with reasonable diligence, to complete such stock exchange listing or registration or qualification of such Shares or other required action under any federal or state law, rule, or regulation, and may require any Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of Shares in compliance with applicable laws, rules, and regulations. The Company shall not be obligated by virtue of any provision of the Plan to recognize the exercise of any Award or to otherwise sell or issue Shares in violation of any such laws, rules, or regulations, and any postponement of the exercise or settlement of any Award under this provision shall not extend the term of such Awards. Neither the Company nor its Directors or officers shall have any obligation or liability to a Participant with respect to any Award (or shares issuable thereunder) that shall lapse because of such postponement.
24.6 No Limitation on Compensation. Nothing in the Plan shall be construed to limit the right of the Company to establish other plans or to pay compensation to its employees, in cash or property, in a manner which is not expressly authorized under the Plan.
24.7 Investment Representations. The Committee may require any individual receiving Shares pursuant to an Award under this Plan to represent and warrant in writing that the individual is
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acquiring the Shares for investment and without any present intention to sell or distribute such Shares.
24.8 Employees Based Outside of the United States. Notwithstanding any provision of this Plan to the contrary, in order to comply with the laws in other countries in which the Company, its Affiliates, and/or its Subsidiaries operate or have Employees, Directors, or Third-Party Service Providers, the Committee, in its sole discretion, shall have the power and authority to:
(a) Determine which Affiliates and Subsidiaries shall be covered by this Plan;
(b) Determine which Employees, Directors, and/or Third-Party Service Providers outside the United States are eligible to participate in this Plan;
(c) Modify the terms and conditions of any Award granted to Employees, Directors, and/or Third-Party Service Providers outside the United States to comply with applicable foreign laws;
(d) Establish subplans and modify exercise procedures and other terms and procedures, to the extent such actions may be necessary or advisable. Any subplans and modifications to Plan terms and procedures established under this Section 24.8 (Employees Based Outside of the United States) by the Committee shall be attached to this Plan document as appendices; and
(e) Take any action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local government regulatory exemptions or approvals.
Notwithstanding the above, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate applicable law.
24.9 Uncertificated Shares. To the extent that this Plan provides for issuance of certificates to reflect the transfer of Shares, the transfer of such Shares may be accomplished on a noncertificated basis, to the extent not prohibited by applicable law or the rules of any stock exchange.
24.10 Unfunded Plan. Participants shall have no right, title, or interest whatsoever in or to any investments that the Company, its Subsidiaries, and/or its Affiliates may make to aid it in meeting its obligations under this Plan. Nothing contained in this Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any Participant, beneficiary, legal representative, or any other individual. To the extent that any individual acquires a right to receive payments from the Company, its Subsidiaries, and/or its Affiliates under this Plan, such right shall be no greater than the right of an unsecured general creditor of the Company, a Subsidiary, or an Affiliate, as the case may be. All payments to be made hereunder shall be paid from the general funds of the Company, a Subsidiary, or an Affiliate, as the case may be, and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as expressly set forth in this Plan.
24.11 No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to this Plan or any Award. The Committee shall determine whether cash, Awards, or other property shall be issued or paid in lieu of fractional Shares or whether such fractional Shares or any rights thereto shall be forfeited or otherwise eliminated.
24.12 No Impact on Benefits. Except as may otherwise be specifically stated under any employee benefit plan, policy, or program, no amount payable in respect of any Award shall be
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(iv) Timing of Payments. Payment(s) of compensation that is subject to Code Section 409A shall only be made upon an event or at a time set forth in Treas. Reg. 1.409A-3, i.e., the Participant’s separation from service, the Participant’s becoming Disabled, the Participant’s death, at a time or a fixed schedule specified in the Plan or an Award Agreement, a change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets of the corporation, or the occurrence of an unforeseeable emergency.
(v) Certain Delayed Payments. Notwithstanding the foregoing, to the extent an amount was intended to be paid such that it would have qualified as a short-term deferral under Code Section 409A and the applicable regulations, then such payment may be delayed if the requirements of Treas. Reg. 1.409A-1(b)(4)(ii) are met.
(d) Specified Employees. Notwithstanding any other provision of the Plan to the contrary, with respect to any Award that constitutes “nonqualified deferred compensation” within the meaning of Code Section 409A, any payments (whether in cash, Shares or other property) to be made with respect to such Award upon a Participant’s “separation from service” (within the meaning of Code Section 409A) shall be delayed if the Participant is a “specified employee” (within the meaning of Code Section 409A) until the earlier of (1) the first day of the seventh month following the Participant’s separation from service or (2) the Participant’s death.
24.14 Non-exclusivity of This Plan. The adoption of this Plan shall not be construed as creating any limitations on the power of the Board or Committee to adopt such other compensation arrangements as it may deem desirable for any Participant.
24.15 No Constraint on Corporate Action. Nothing in this Plan shall be construed to: (a) limit, impair, or otherwise affect the Company’s or a Subsidiary’s or an Affiliate’s right or power to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer all or any part of its business or assets; or (b) limit the right or power of the Company or a Subsidiary or an Affiliate to take any action which such entity deems to be necessary or appropriate.
24.16 Headings and Captions. The headings and captions herein are provided for reference and convenience only, shall not be considered part of this Plan, and shall not be employed in the construction of this Plan.
24.17 Governing Law. The Plan and each Award Agreement shall be governed by the laws of the State of New York, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Plan to the substantive law of another jurisdiction. Unless otherwise provided in the Award Agreement, recipients of an Award under this Plan are deemed to submit to the exclusive jurisdiction and venue of the federal or state courts of New York to resolve any and all issues that may arise out of or relate to this Plan or any related Award Agreement.
24.18 Delivery and Execution of Electronic Documents. To the extent permitted by applicable law, the Company may (a) deliver by email or other electronic means (including posting on a web site maintained by the Company or by a third party under contract with the Company) all documents relating to the Plan or any Award thereunder (including without limitation, prospectuses required by the U.S. Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including without limitation, annual reports and proxy statements), and (b) permit Participants to electronically execute applicable Plan documents (including, but not limited to, Award Agreements) in a manner prescribed by the Committee.
|
|
|
|
|
| 132 |
|
2024 PROXY STATEMENT |
|
|
2016 LONG TERM INCENTIVE PLAN
24.19 No Representations or Warranties Regarding Tax Affect. Notwithstanding any provision of the Plan to the contrary, the Company, its Affiliates and Subsidiaries, the Board, and the Committee neither represent nor warrant the tax treatment under any federal, state, local, or foreign laws and regulations thereunder (individually and collectively referred to as the “Tax Laws”) of any Award granted or any amounts paid to any Participant under the Plan including, but not limited to, when and to what extent such Awards or amounts may be subject to tax, penalties, and interest under the Tax Laws.
24.20 Indemnification. Subject to requirements of New York law, each individual who is or shall have been a member of the Board, or a committee appointed by the Board, or an officer of the Company to whom authority was delegated in accordance with Article 3 (Administration) shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under this Plan and against and from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his/her own behalf, unless such loss, cost, liability, or expense is a result of his/her own willful misconduct or except as expressly provided by statute. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such individuals may be entitled under the Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
24.21 No Obligation to Disclose Material Information. Except to the extent required by applicable securities laws, none of the Company, an Affiliate, the Committee, or the Board shall have any duty or obligation to affirmatively disclose material information to a record or beneficial holder of Shares or an Award, and such holder shall have no right to be advised of any material information regarding the Company or any Affiliate at any time prior to, upon or in connection with receipt or the exercise or distribution of an Award. The Company makes no representation or warranty as to the future value of the Shares that may be issued or acquired under this Plan.
24.22 Entire Agreement. Except as expressly provided otherwise, this Plan and any Award Agreement constitute the entire agreement with respect to the subject matter hereof and thereof. Provided that in the event of any inconsistency between this Plan and any Award Agreement, the terms and conditions of this plan shall control.
|
|
|
|
|
|
|
|
|
|
2024 PROXY STATEMENT |
|
|
133 |
|
Pay vs Performance Disclosure
|
12 Months Ended |
|
Mar. 31, 2024
USD ($)
|
Mar. 31, 2023
USD ($)
|
Mar. 31, 2022
USD ($)
|
Mar. 31, 2021
USD ($)
|
| Pay vs Performance Disclosure |
|
|
|
|
| Pay vs Performance Disclosure, Table |
Compensation Actually Paid Table As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between “compensation actually paid” to our CEO and to our other NEOs and certain financial performance of the Company for the indicated fiscal years. Compensation actually paid, as determined under SEC requirements, does not reflect the actual amount of compensation earned by or paid to our executive officers during a covered year. For further information concerning the Company’s philosophy and how the Company aligns executive compensation with the Company’s performance, refer to the Compensation Discussion and Analysis.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Avg. SCT Total for Other NEOs (2) |
|
Avg. CAP to Other NEOs (2) |
|
Value of Initial Fixed
$100 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
5,799,250 |
|
|
|
$ |
— |
|
|
|
$ |
7,011,006 |
|
|
|
$ |
— |
|
|
|
$ |
1,479,373 |
|
|
|
$ |
1,769,549 |
|
|
|
$ |
183.61 |
|
|
|
$ |
219.31 |
|
|
|
$ |
46,625 |
|
|
|
$ |
119,238 |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
4,973,892 |
|
|
|
$ |
— |
|
|
|
$ |
3,543,606 |
|
|
|
$ |
— |
|
|
|
$ |
1,622,384 |
|
|
|
$ |
1,421,836 |
|
|
|
$ |
151.72 |
|
|
|
$ |
155.40 |
|
|
|
$ |
48,429 |
|
|
|
$ |
105,869 |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
4,067,021 |
|
|
|
$ |
— |
|
|
|
$ |
2,562,396 |
|
|
|
$ |
— |
|
|
|
$ |
1,347,394 |
|
|
|
$ |
788,702 |
|
|
|
$ |
171.66 |
|
|
|
$ |
147.62 |
|
|
|
$ |
29,660 |
|
|
|
$ |
95,589 |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
5,572,610 |
|
|
|
$ |
397,800 |
|
|
|
$ |
9,019,389 |
|
|
|
$ |
423,480 |
|
|
|
$ |
1,169,073 |
|
|
|
$ |
2,651,095 |
|
|
|
$ |
212.53 |
|
|
|
$ |
159.26 |
|
|
|
$ |
9,106 |
|
|
|
$ |
48,854 |
|
| (1) |
The CEOs and the Other NEOs for the indicated years were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Schadeberg |
|
|
|
|
2023 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Schadeberg |
|
|
|
|
2022 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Wozniak |
|
|
|
|
2021 |
|
|
Mr. Wilson |
|
|
Mr. Fleming |
|
Messrs. Korman, McCormick, Rustowicz, and Wozniak |
| (2) |
Amounts represent compensation actually paid to our CEO and the average compensation actually paid to our Other NEOs for the relevant fiscal year, as determined under SEC rules (and described below). |
| (3) |
For the relevant fiscal year, represents the cumulative TSR (the “Peer Group TSR”) of the Dow Jones U.S. Diversified Industrials Index. |
| (4) |
In accordance with SEC rules, the Company is required to include in the Pay versus Performance table the “most important” financial performance measure (as determined by the Company) used to link compensation actually paid to our CEOs and Other NEOs to Company performance for the most recently completed fiscal year. The Company determined that Adjusted EBIT, which is a metric included in our incentive program, meets this requirement and therefore, we have included this performance measure in the Pay versus Performance table. Adjusted EBIT is a non-GAAP measure which is defined in the FY24 Financial Metrics section. | Compensation actually paid to our CEOs and Other NEOs represents the “Total” compensation reported in the Summary Compensation Table for the applicable fiscal year, as adjusted as follows: First Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
5,799,250 |
|
|
|
$ |
5,491 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
3,495,828 |
|
|
|
$ |
4,352,194 |
|
|
|
$ |
— |
|
|
|
$ |
448,465 |
|
|
|
$ |
(87,584 |
) |
|
|
$ |
7,011,006 |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
4,973,892 |
|
|
|
$ |
2,900 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
2,816,047 |
|
|
|
$ |
3,501,035 |
|
|
|
$ |
— |
|
|
|
$ |
(1,616,943 |
) |
|
|
$ |
(495,431 |
) |
|
|
$ |
3,543,606 |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
4,067,021 |
|
|
|
$ |
1,896 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
2,362,446 |
|
|
|
$ |
1,840,059 |
|
|
|
$ |
— |
|
|
|
$ |
(993,714 |
) |
|
|
$ |
13,371 |
|
|
|
$ |
2,562,396 |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
5,572,610 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
3,543,080 |
|
|
|
$ |
6,414,349 |
|
|
|
$ |
575,510 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
9,019,389 |
| Second Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
397,800 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
254,079 |
|
|
|
$ |
75,660 |
|
|
|
$ |
204,099 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
423,480 |
| Average of Other Named Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
1,479,373 |
|
|
|
$ |
13,476 |
|
|
|
$ |
53 |
|
|
|
$ |
— |
|
|
|
$ |
668,025 |
|
|
|
$ |
831,669 |
|
|
|
$ |
— |
|
|
|
$ |
157,778 |
|
|
|
$ |
(17,717 |
) |
|
|
$ |
1,769,549 |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
1,622,384 |
|
|
|
$ |
8,205 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
814,420 |
|
|
|
$ |
701,707 |
|
|
|
$ |
— |
|
|
|
$ |
33,962 |
|
|
|
$ |
(113,592 |
) |
|
|
$ |
1,421,836 |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
1,347,394 |
|
|
|
$ |
6,473 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
668,073 |
|
|
|
$ |
520,369 |
|
|
|
$ |
— |
|
|
|
$ |
(404,240 |
) |
|
|
$ |
(275 |
) |
|
|
$ |
788,702 |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
1,169,073 |
|
|
|
$ |
2,962 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
467,863 |
|
|
|
$ |
1,137,057 |
|
|
|
$ |
— |
|
|
|
$ |
785,776 |
|
|
|
$ |
30,014 |
|
|
|
$ |
2,651,095 |
|
|
|
|
|
| Company Selected Measure Name |
Adjusted EBIT
|
|
|
|
| Named Executive Officers, Footnote |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Schadeberg |
|
|
|
|
2023 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Schadeberg |
|
|
|
|
2022 |
|
|
Mr. Wilson |
|
|
N/A |
|
Messrs. Brant, Korman, Rustowicz, and Wozniak |
|
|
|
|
2021 |
|
|
Mr. Wilson |
|
|
Mr. Fleming |
|
Messrs. Korman, McCormick, Rustowicz, and Wozniak |
|
|
|
|
| Peer Group Issuers, Footnote |
For the relevant fiscal year, represents the cumulative TSR (the “Peer Group TSR”) of the Dow Jones U.S. Diversified Industrials Index.
|
|
|
|
| Adjustment To PEO Compensation, Footnote |
First Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
5,799,250 |
|
|
|
$ |
5,491 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
3,495,828 |
|
|
|
$ |
4,352,194 |
|
|
|
$ |
— |
|
|
|
$ |
448,465 |
|
|
|
$ |
(87,584 |
) |
|
|
$ |
7,011,006 |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
4,973,892 |
|
|
|
$ |
2,900 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
2,816,047 |
|
|
|
$ |
3,501,035 |
|
|
|
$ |
— |
|
|
|
$ |
(1,616,943 |
) |
|
|
$ |
(495,431 |
) |
|
|
$ |
3,543,606 |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
4,067,021 |
|
|
|
$ |
1,896 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
2,362,446 |
|
|
|
$ |
1,840,059 |
|
|
|
$ |
— |
|
|
|
$ |
(993,714 |
) |
|
|
$ |
13,371 |
|
|
|
$ |
2,562,396 |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
5,572,610 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
3,543,080 |
|
|
|
$ |
6,414,349 |
|
|
|
$ |
575,510 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
9,019,389 |
| Second Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
397,800 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
254,079 |
|
|
|
$ |
75,660 |
|
|
|
$ |
204,099 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
423,480 |
|
|
|
|
|
| Non-PEO NEO Average Total Compensation Amount |
$ 1,479,373
|
$ 1,622,384
|
$ 1,347,394
|
$ 1,169,073
|
| Non-PEO NEO Average Compensation Actually Paid Amount |
$ 1,769,549
|
1,421,836
|
788,702
|
2,651,095
|
| Adjustment to Non-PEO NEO Compensation Footnote |
Average of Other Named Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Compensation
Table
Total |
|
Minus:
Change
in
Present
Value of
NQDC |
|
Minus:
Change
in
Present
Value of
Pension |
|
Plus:
Pension
Service
Costs
Attributable
to the
Applicable
Year |
|
Minus:
Grant Date
Fair Value
of Equity
Awards
Granted
During
Applicable
Year |
|
Plus: Year-
End Fair
Value of
Equity
Awards
Granted
During
Applicable
Year |
|
Plus:
Fair Value
of
Awards
Granted
and
Vested in
Applicable
Year |
|
Plus: Change in Fair Value as of Year- End of Any Prior-Year Awards that Remain Unvested as of Year-End |
|
Plus:
Change in
Fair Value
as of
Vesting
Date of
Any Prior-
Year
Awards
that Vested
During
Applicable
Year |
|
Compensation
Actually Paid |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
$ |
1,479,373 |
|
|
|
$ |
13,476 |
|
|
|
$ |
53 |
|
|
|
$ |
— |
|
|
|
$ |
668,025 |
|
|
|
$ |
831,669 |
|
|
|
$ |
— |
|
|
|
$ |
157,778 |
|
|
|
$ |
(17,717 |
) |
|
|
$ |
1,769,549 |
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
$ |
1,622,384 |
|
|
|
$ |
8,205 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
814,420 |
|
|
|
$ |
701,707 |
|
|
|
$ |
— |
|
|
|
$ |
33,962 |
|
|
|
$ |
(113,592 |
) |
|
|
$ |
1,421,836 |
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
$ |
1,347,394 |
|
|
|
$ |
6,473 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
668,073 |
|
|
|
$ |
520,369 |
|
|
|
$ |
— |
|
|
|
$ |
(404,240 |
) |
|
|
$ |
(275 |
) |
|
|
$ |
788,702 |
|
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
|
$ |
1,169,073 |
|
|
|
$ |
2,962 |
|
|
|
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
467,863 |
|
|
|
$ |
1,137,057 |
|
|
|
$ |
— |
|
|
|
$ |
785,776 |
|
|
|
$ |
30,014 |
|
|
|
$ |
2,651,095 |
|
|
|
|
|
| Compensation Actually Paid vs. Total Shareholder Return |
|
|
|
|
| Compensation Actually Paid vs. Net Income |
|
|
|
|
| Compensation Actually Paid vs. Company Selected Measure |
|
|
|
|
| Total Shareholder Return Vs Peer Group |
|
|
|
|
| Tabular List, Table |
Pay Versus Performance Tabular List We believe the following performance measures represent the most important financial performance measures used by us to link compensation actually paid to our NEOs for the fiscal year ended March 31, 2024:
| • |
|
Adjusted Free Cash Flow |
|
|
|
|
| Total Shareholder Return Amount |
$ 183.61
|
151.72
|
171.66
|
212.53
|
| Peer Group Total Shareholder Return Amount |
219.31
|
155.4
|
147.62
|
159.26
|
| Net Income (Loss) |
$ 46,625
|
$ 48,429
|
$ 29,660
|
$ 9,106
|
| Company Selected Measure Amount |
119,238
|
105,869
|
95,589
|
48,854
|
| Measure:: 1 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EBIT
|
|
|
|
| Non-GAAP Measure Description |
Adjusted EBIT is a non-GAAP measure which is defined in the FY24 Financial Metrics section.
|
|
|
|
| Measure:: 2 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted Free Cash Flow
|
|
|
|
| Measure:: 3 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted ROIC
|
|
|
|
| Wilson [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| PEO Total Compensation Amount |
$ 5,799,250
|
$ 4,973,892
|
$ 4,067,021
|
$ 5,572,610
|
| PEO Actually Paid Compensation Amount |
$ 7,011,006
|
$ 3,543,606
|
$ 2,562,396
|
$ 9,019,389
|
| PEO Name |
Mr. Wilson
|
Mr. Wilson
|
Mr. Wilson
|
Mr. Wilson
|
| Fleming [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| PEO Total Compensation Amount |
|
|
|
$ 397,800
|
| PEO Actually Paid Compensation Amount |
|
|
|
$ 423,480
|
| PEO Name |
|
|
|
Mr. Fleming
|
| PEO | Wilson [Member] | Change in Present Value of NQDC [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
$ (5,491)
|
$ (2,900)
|
$ (1,896)
|
|
| PEO | Wilson [Member] | Grant Date Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(3,495,828)
|
(2,816,047)
|
(2,362,446)
|
$ (3,543,080)
|
| PEO | Wilson [Member] | Year End Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
4,352,194
|
3,501,035
|
1,840,059
|
6,414,349
|
| PEO | Wilson [Member] | Value of Awards Granted and Vested in Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
|
575,510
|
| PEO | Wilson [Member] | Change in Fair Value as of Year End of Any Prior Year Awards that Remain Unvested as of Year End [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
448,465
|
(1,616,943)
|
(993,714)
|
|
| PEO | Wilson [Member] | Change in Fair Value as of Vesting Date of Any Prior Year Awards that Vested During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(87,584)
|
(495,431)
|
13,371
|
|
| PEO | Fleming [Member] | Grant Date Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
|
(254,079)
|
| PEO | Fleming [Member] | Year End Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
|
75,660
|
| PEO | Fleming [Member] | Value of Awards Granted and Vested in Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
|
|
|
204,099
|
| Non-PEO NEO | Change in Present Value of NQDC [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(13,476)
|
(8,205)
|
(6,473)
|
(2,962)
|
| Non-PEO NEO | Change in Present Value of Pension [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(53)
|
|
|
|
| Non-PEO NEO | Grant Date Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(668,025)
|
(814,420)
|
(668,073)
|
(467,863)
|
| Non-PEO NEO | Year End Fair Value of Equity Awards Granted During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
831,669
|
701,707
|
520,369
|
1,137,057
|
| Non-PEO NEO | Change in Fair Value as of Year End of Any Prior Year Awards that Remain Unvested as of Year End [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
157,778
|
33,962
|
(404,240)
|
785,776
|
| Non-PEO NEO | Change in Fair Value as of Vesting Date of Any Prior Year Awards that Vested During Applicable Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
$ (17,717)
|
$ (113,592)
|
$ (275)
|
$ 30,014
|