SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of
the Securities Exchange Act of 1934
Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
Check the appropriate box:
☐ | Preliminary Proxy Statement | |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
☒ | Definitive Proxy Statement | |
☐ | Definitive Additional Materials | |
☐ | Soliciting Material Pursuant to §240.14a-12 |
CURTISS-WRIGHT CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
☒ |
| |||||
☐
| ||||||
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. | ||||||
(1) | Title of each class of securities to which transaction applies: | |||||
(2) | Aggregate number of securities to which transaction applies: | |||||
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | |||||
(4) | Proposed maximum aggregate value of transaction: | |||||
(5) | Total fee paid: |
☐ | Fee paid previously with preliminary materials. | |||
☐ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | |||
(1) | Amount Previously Paid: | |||
| ||||
Form, Schedule or Registration Statement No.: | ||||
(3) | Filing Party: | |||
(4) | Date Filed: | |||
Dear Valued Stockholder:
You are cordially invited to attend the annual meeting of stockholders of Curtiss-Wright Corporation to be held on Thursday, May 6, 2021,2, 2024, at the Homewood Suites by Hilton, 125 Harbour Place Drive, Davidson, North Carolina 28036, commencing at 1:00 p.m. local time.time (the “Annual Meeting”).
We intend to hold the annual meeting of stockholdersAnnual Meeting in person.person again this year. The proxies that we solicit give you the opportunity to vote on all scheduled matters that come before the annual meeting. Whether or not you plan to attend, you can be sure that your shares are represented by promptly voting and submitting your proxy by phone or by internet as described in the following materials. If you want proxy materials mailed to you, you can make a request by completing, signing, dating and returning your proxy card enclosed with those materials in the postage-paid envelope provided to you.
In addition, we continue to actively monitor developments in relationprovided. Please refer to the COVID-19 pandemicaccompanying Notice of Annual Meeting and Proxy Statement for further important information about the related recommendations and protocols issued and that may be issued by public health authorities and governments. The health and well-being of our employees and stockholders is a high priority, and we are sensitive to the public health and travel concerns our stockholders may have. Accordingly, if we determine that it is not possible to hold our annual meeting of stockholders in person, we will announce alternative arrangements for the meeting, which may include a change in venue or holding the meeting virtually. We will announce any such change and the details on how to participate by press release and posting details on our website at https://investors.curtisswright.com/governance/annual-meeting, which will also be filed with the SEC as proxy material. If you are planning to attend our annual meeting of stockholders, please check our website the week of the meeting. As always, we encourage you to vote your shares by proxy prior to the annual meeting of stockholders.Annual Meeting.
The global economic effects associated with the COVID-19 pandemic have been unprecedented in their scope and depth. We have been following, and will continue to follow, all recommendations of the CDC and other agencies to maximize the safety and well-being of our employees. Throughout this crisis, our unwavering focus has been on striking a balance between doing everything we can to keep our workplace as safe as possible and stabilizing our business during this time of economic disruption. Curtiss-Wright has faced many challenges over our 90-year history and, as with previous downturns, we believe we have the ability to emerge from this crisis an even stronger company.
The Notice of Annual Meeting and the Proxy Statement, which follow this letter, provide information concerning matters to be considered and acted upon at the
annual meeting. We will present a brief report on our business followed by a question and answerquestion-and-answer period at the annual meeting.
In accordance with rules adopted by the U.S. Securities and Exchange Commission, we are using the internet as our primary means of furnishing proxy materials to our stockholders. Accordingly, most stockholders will not receive paper copies of our proxy materials. We will instead send our stockholders a notice with instructions for accessing the proxy materials and voting electronically over the internet or by telephone. The notice also provides information on how stockholders may request paper copies of our proxy materials. We believe electronic delivery of our proxy materials will help us reduce the environmental impact and costs of printing and distributing paper copies and improve the speed and efficiency by which our stockholders can access these materials.
We are resolutely focused on strengthening our culture and our workplace—putting greater emphasis on diversity, talent acquisition and development, and the employee experience. We are committed to ensuring our business practices are sustainable, and we will do our part to support the ongoing environmental, social and governance (ESG) issues, so the state of our planet and our communities are healthier tomorrow than they are today.
Finally, on behalf of the entire Curtiss-Wright family, I wish to thank Albert Smith,S. Marce Fuller, who will retire atfrom the Board just prior to our 20212024 annual meeting of stockholders after 15stockholders. Ms. Fuller is retiring with more than 24 years of distinguished service and leadership at Curtiss-Wright, which includes serving as a member of our Board of Directors.lead independent director for the past three years. I congratulate Ms. Fuller on her retirement and thank her for her leadership, counsel, and friendship.
On behalf of your Board of Directors, management, and our employees, I would like to express our appreciation for your continued support. I look forward to your participation in the Annual Meeting.
Sincerely, | ||
| ||
|
CURTISS-WRIGHT CORPORATION
130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the holders of the common stock of Curtiss-Wright Corporation:
Notice is hereby given that the annual meeting of stockholders (the “Annual Meeting”) of Curtiss-Wright Corporation, a Delaware corporation (the “Company”), will be held on Thursday, May 6, 2021,2, 2024, at the Homewood Suites by Hilton, 125 Harbour Place Drive, Davidson, North Carolina 28036, commencing at 1:00 p.m.pm local time, for the following purposes:
(1) | To elect the nine director nominees named herein; | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(2) | To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2024; | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3) | To approve the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan; | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(4) | To approve on an advisory | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(5) | To consider and transact such other business as may properly come before the Annual Meeting. |
Only record holders of the Company’s common stock at the close of business on March 12, 2021,8, 2024, the record date for the Annual Meeting, are entitled to notice of and to vote at the Annual Meeting. A list of stockholders will be available for examination by any stockholder(s) at the Annual Meeting and during normal business hours at the offices of the Company, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036, during the ten days preceding the Annual Meeting date.
The Company cordially invites all stockholders to attend the Annual Meeting in person. Stockholders who plan to attend the Annual Meeting in person are nevertheless requested to vote their shares electronically over the Internet, or by telephone, or if you receive a proxy card in the mail, by mailingsigning, dating and returning the completed proxy card in the postage-paid envelope provided, to make certain that their vote will be represented at the Annual Meeting should they be prevented unexpectedly from attending.
By Order of the Board of Directors, | ||
March | Paul J. Ferdenzi | |
| ||
General Counsel |
We intend to hold the annual meeting of stockholders in person. But given public health concerns related to the COVID-19 pandemic, we urge you to consider voting in advance of the meeting through one of the remote methods described in this Notice of Annual Meeting and the Proxy Statement, which follows this letter, in lieu of attending the meeting in person. In addition, we continue to actively monitor developments in relation to the COVID-19 pandemic and the related recommendations and protocols issued and that may be issued by public health authorities and governments. The health and well-being of our employees and stockholders is a high priority, and we are sensitive to the public health and travel concerns our stockholders may have. Accordingly, if we determine that it is not possible to hold our annual meeting of stockholders in person, we will announce alternative arrangements for the meeting, which may include a change in venue or holding the meeting virtually. We will announce any such change and the details on how to participate by press release and posting details on our website at https://investors.curtisswright.com/governance/annual-meeting, which will also be filed with the SEC as proxy material. If you are planning to attend our annual meeting of stockholders, please check our website the week of the meeting. As always, we encourage you to vote your shares prior to the annual meeting of stockholders.
IMPORTANT: WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE PROMPTLY SUBMIT YOUR PROXY ELECTRONICALLY OVER THE INTERNET OR BY TELEPHONE, OR IF YOU RECEIVE A PAPER PROXY CARD, PLEASE FILL IN, SIGN AND PROMPTLY RETURN YOUR PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on Thursday, May 6, 2021. 2, 2024.A Notice and Proxy Statement and combined Business Review/20202023 Annual Report on Form 10-K to security holders are available at: www.proxyvote.com..
TABLE OF CONTENTS
PROXY SUMMARY
The following is a summary that highlights information contained elsewhere in this Proxy Statement. This summary does not contain all the information you should consider, and before voting, you are urged to carefully read the entire Proxy Statement.
Voting Matters and Vote Recommendations
The Company currently expects to consider threefour items of business at the 20212024 Annual Meeting. The following table lists those items of business and the Board of DirectorsBoard’s vote recommendation.
Proposal | Board Recommendation | |||||||
|
| Reasons for Recommendation | More | |||||
(1) | Election of | FOR ALL |
| The Board and the Committee on Directors and Governance believe the nominees possess the skills, experience, qualifications, and diversity to effectively monitor performance, provide oversight and support management’s execution of the Company’s long-term strategy. | Page | |||
(2) | Ratification of the independent registered public accounting firm | FOR |
| Based on their assessment, the Board and the Audit Committee believes that the appointment of Deloitte & Touche LLP is in the best interests of the Company and its stockholders. | Page | |||
(3) Approve the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan | FOR | To foster and promote the long-term financial success of the Company and to increase stockholder value by (i) providing eligible employees, officers, non-employee directors, consultants, and advisors of the Company with incentives that align their interests with stockholders’ interests and that contribute to the long-term growth and profitability of the Company, and (ii) enabling the Company to attract, retain and motivate highly qualified employees, officers, non-employee directors, consultants, and advisors who are in a position to make significant contributions to the Company for its successful operations. | Page 81 | |||||
(4) Advisory | FOR |
| The Company’s executive compensation program incorporates several compensation governance best practices and reflects the Company’s commitment to pay for performance. | Page 90 |
|
Director Nominees
Set forth below is summary information concerning the Company’s director nomineesDirector Nominees who are being voted on at the Annual Meeting.
|
|
|
|
|
|
|
|
|
|
|
Name | Age | Director | Principal Occupation | Independent |
|
| ||||
David C. Adams | 67 | 2013 | Executive Chairman, Curtiss-Wright Corporation; Former Chief Executive Officer, Curtiss-Wright Corporation | No |
|
| ||||
Lynn M. Bamford | 57 | 2021 | President and Chief Executive Officer, Curtiss-Wright Corporation | No |
|
| ||||
Dean M. Flatt | 70 | 2012 | Former President and Chief Operating Officer, Honeywell International’s Defense and Space business | Yes |
|
| ||||
S. Marce Fuller | 60 | 2000 | Former President and Chief Executive Officer, Mirant Corporation | Yes |
|
| ||||
Bruce D. Hoechner | 61 | 2017 | President and Chief Executive Officer, Rogers Corporation | Yes |
|
| ||||
Glenda J. Minor | 64 | 2019 | Chief Executive Officer and Principal, Silket Advisory Services | Yes |
|
| ||||
Anthony J. Moraco | 61 | N/A | Former Chief Executive Officer and member of the Board of Directors, Science Applications International Corporation | Yes |
|
| ||||
Admiral (Ret.) | 72 | 2008 | Retired Commander of U.S. Fleet Forces Command; Former Vice Chief of Naval Operations | Yes |
|
| ||||
Robert J. Rivet | 67 | 2011 | Former Executive Vice President, Chief Operations and Administrative Officer, Advanced Micro Devices, Inc. | Yes |
|
| ||||
Peter C. Wallace | 66 | 2016 | Former Chief Executive Officer, Gardner Denver Inc. | Yes |
|
|
Name | Age | Director Since | Principal Occupation | Independent |
Lynn M. Bamford | 60 | 2021 | Chair and Chief Executive Officer, Curtiss-Wright Corporation | No |
Dean M. Flatt | 73 | 2012 | Former President and Chief Operating Officer, Honeywell International’s Defense and Space business | Yes |
Bruce D. Hoechner | 64 | 2017 | Former President and Chief Executive Officer, Rogers Corporation | Yes |
Glenda J. Minor | 67 | 2019 | Chief Executive Officer and Principal, Silket Advisory Services | Yes |
Anthony J. Moraco | 64 | 2021 | Former Chief Executive Officer and member of the Board of Directors, Science Applications International Corporation | Yes |
Admiral (Ret.) William F. Moran | 65 | 2023 | President, WFM Advisors, LLC; Former Vice Chief of Naval Operations | Yes |
Robert J. Rivet | 69 | 2011 | Former Executive Vice President, Chief Operations and Administrative Officer, Advanced Micro Devices, Inc. | Yes |
Peter C. Wallace | 69 | 2016 | Former Chief Executive Officer, Gardner Denver Inc. | Yes |
Lieutenant General (Ret.) Larry D. Wyche | 66 | 2023 | Chief Executive Officer, Wyche Leadership and Federal Contracting Consulting; Former Deputy Commanding General, U.S. Army Materiel Command | Yes |
2 |
Corporate Governance Highlights
The Company is committed to good corporate governance, which promotes the long-term interests of stockholders, strengthens Board and executive leadership accountability, and helps build public trust in the Company. As part of the Company’sthis commitment, to high ethical standards, the Board has adopted best practices in corporate governance, including the following:
Board Independence | Lead Independent Director | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• 8 out of 9 director nominees are independent • 100% independent Board committees • Chair and CEO is the only management Director nominee | • Consults with Chair regarding setting Board meeting agendas, and consults with all Board committees • Serves as liaison between the Chair and the independent directors • Facilitates communication between and among the independent directors and management • Presides at all Board meetings where the Chair is not present, including executive sessions of the independent directors • Is available, when appropriate, for consultation and direct communication with stockholders • Coordinates annual Board performance review of Chief Executive Officer • Leads the discussion of Board’s self-assessment and evaluation of results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Board Practices | Other Best Practices | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Annual election of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• Annual Board and committee evaluations |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Regular executive sessions of non-management directors | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• Board participation in executive succession planning | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• Annual review of Committee Charters and Corporate Governance Principles • Robust risk oversight with Board and committee roles | • Comprehensive Code of Conduct and Corporate Governance Principles | • Anti-hedging and pledging policy • Annual | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• Robust “clawback” policies for Incentive Compensation, including the adoption of an incentive compensation clawback policy for Section 16 officers pursuant to Dodd-Frank in the event of certain accounting restatements | • Robust stock ownership requirements for directors and executive officers | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Strong pay-for-performance philosophy | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
20202023 Financial Performance Highlights
Despite the challenges relating primarily to continuing supply chain delivery disruptions, workforce availability issues, and inflationary pressures, the Company performed very well in fiscal 2023, with strong increases in sales, operating income, earnings per share, and free cash flow. In 2020,2023, the Company’s three-year total shareholder return (TSR) ranked eight orin the 50th87th percentile amongagainst the Company’s peer group.S&P MidCap 400. TSR is the change in the Company’s common stockCommon Stock share price plus dividends from the beginning of the measurement period to the end (three years,
2
1/1/20182021 to 12/31/2020)2023). The Company’s 20202023 financial performance foras measured under the Company’s executive compensation included:plans were as follows:
• | Adjusted organic Sales Growth of 10.7%. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Adjusted operating | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
income of $494 million. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Working capital as a percentage of sales |
3 |
The Company’s financial performance includes adjustments referenced in the Company’s fourth quarter 2023 earnings release furnished to the SEC on February 15, 2024. The Company’s financial performance above excludes the performance of any acquisitions consummated during the performance period, as well as other adjustments referenced in the Company’s fourth quarter 2020 earnings release furnished to the SEC on February 25, 2021.period.
Executive Compensation Practices Highlights
The Executive Compensation Committee is firmly committed to implementing a compensation program that aligns management and stockholder interests, encourages executives to drive sustainable stockholder value creation, and helps retain key personnel. In 2020,2023, the Company received 96%92% stockholder support for the Company’s “Say-on-Pay” vote, which the Executive Compensation Committee considers to be among the most important items of feedback about the Company’s executive compensation program. The Company recognizes and rewards its executive officers through compensation arrangements that directly link their pay to the Company’s performance, and the Company ensures a strong alignment of interests with its stockholders by including a significant amount of performance basedperformance-based compensation in the overall mix of pay. The Company’s pay mix includes base salary, an annual incentive cash bonus plan, and a long-term incentive plan under which the Company grants time-based restricted stock units and performance-based cash and stock units. Key elements of the Company’s pay practices are as follows:
What Curtiss-Wright Does | What Curtiss-Wright | |||||
• | Aligns pay and performance using measures of financial and operating performance including use of relative TSR | • No NEO employment agreements | ||||
• | Does not engage in executive compensation practices that encourage excessive risk | |||||
• | Balances short-term and long-term incentives using multiple performance measures that focus on profitable top line growth | • No short sales, hedging, or pledging of Curtiss-Wright stock permitted | ||||
• | No reloading, re-pricing or backdating stock options | |||||
• | Places maximum caps on incentive payout consistent with market competitive practice | • | No tax gross-ups on change-in-control benefits for executives | |||
• | Establishes rigorous stock ownerships guidelines for NEOs and Board members including a 50% mandatory hold on net shares until ownership guidelines are met for NEOs | • No dividends on unvested or unearned performance units/shares | ||||
• | No excessive perquisites | |||||
• |
| clawback policy for Section 16 officers pursuant to Dodd-Frank in the event of certain accounting restatements | • | No excessive severance and/or | ||
• | Uses an independent external compensation consultant to review and advise on executive compensation | |||||
• | Uses double trigger |
4 |
The Company’s business and operations aligns with the Aerospace and Defense Global Industry Classification Standard. The Company believes that a commitment to positive environmental, social and governance-related business practices strengthens its businesses,operations, increases the Company’s connection with its
3
stockholders,all stakeholders, and helps the Company better serve its customers and the communities in which the Company operates. The Company’s commitment to social responsibility extends to the environment, ethical business practices, trade compliance, responsible sourcing, human rights, cybersecurity, data privacy, human capital management, labor practices and our employees’ health and safety. More information is available within the Sustainability section of the Company’s website at www.curtisswright.com/company/sustainability/. The Company also sees in these commitments additional ways of creating value for the Company’s stockholders, current and prospective employees, customers and other stakeholders. The Company demonstrates its commitments through its corporate social responsibility program (“CSR”). The CSR program outlines the Company’s commitments, guidelines, and policies, which governs the Company’s behavior and its business practices. To better manage the CSR program, the Company created a cross-functional ESG Council led by the Company’s General Cousel, which meets on a regular basis, and is responsible for establishing and promoting the strategies, standards and practices that advance the Company’s CSR performance.
4
The CSR program consists of three inter-related activity areas that are mutually supportive of each other:
Business Practice | We conduct business in an environmentally conscious, socially responsible and ethical manner, including efforts to mitigate climate change and promote sustainability, while protecting the health and safety of the Company’s workers and community. | |||||||
• | We comply with all applicable environmental, health and safety (EHS) laws and | |||||||
• We track total recordable rate (TRR) and days away, restriction and transfer rate (DART) for all sites worldwide. Our TRR and DART rates for | ||||||||
• | We encourage environmental and safety certifications for our manufacturing facilities. | |||||||
• | We conduct third-party EHS audits to verify that we are meeting our regulatory compliance | |||||||
• | We are focused on promoting environmental stewardship and introducing innovative processes and technologies that improve our efforts, including quantifying our environmental impact along with our efforts to maximize future generations’ ability to live, work, and play in our shared natural environment. In early 2021, we started to compile utility data (including energy | |||||||
standards and applicable regulatory reporting requirements. We • As an environmentally conscious company, we focus on and support efforts that move towards a zero-waste future by conserving energy and water, minimizing waste and emissions, and promoting recycling and renewable energy to reduce adverse environmental impacts. | ||||||||
• | In | |||||||
• | We utilize safe technologies, training programs, effective risk management practices, and sound science in our operations to minimize risk to employees. |
5 |
Business Practice | We believe a diverse | ||||||
• | We build a culture of inclusion with a focus on leadership, eliminating systemic barriers and fostering engagement. We | ||||||
• We utilize exit interviews and on-boarding interviews to provide feedback regarding turnover and employee desires for growth and development. These interviews are also utilized to identify drivers of voluntary turnover and departures from the Company to alert us to any issues, as well as to make improvements to the employee experience. Employee turnover rate and reasons, including voluntary and involuntary departures, are monitored annually, and reviewed at regular intervals with the senior leadership team and Board of Directors. | • | We promote ongoing career development for employees to encourage innovation and engagement through constructive reviews and various talent/leadership development initiatives. | |||||
• We are committed to maintaining a solid pipeline of talent and developing future leaders throughout our organization, including a New Business Leader program, Engineering Leadership Development Program, and Succession Planning Program. Over the past several years, we have also hosted “Careers in Engineering” near one of our facilities in the United Kingdom to promote engineering careers for adolescents, and consistently engage with local colleges and universities across our many facilities globally. | • We cultivate technical, domain expertise and collaborative thought leadership for early through advanced career levels through our Technical Fellows program and our Innovation program. These important programs foster our culture of innovation, fuel collaboration across diverse disciplines, and help us attract, mentor, and inspire the next generation of talent. | • We are committed to a global workforce that represents and reflects the communities where we operate. Our Affirmative Action Plans drive our compliance in the U.S., and we use similar programs globally that encourage diversity, equity, and inclusion. In addition, we provide annual training to our global workforce on respect for the individual. | • We offer a tuition reimbursement program for those employees seeking to improve or complete their education consistent with their career paths. | • | We are committed to providing a safe and healthy work environment for our global employee base, guided by a strong set of core We promote employee wellness. • We provide our employees and their families with a variety of health and wellness programs such as free annual biometric screening and health assessments at work or offsite, annual free flu shot clinics, a tobacco cessation program, weight management programs and an employee assistance program, which offers advice on mental health, legal and financial issues. |
5
6 |
Business Practice | We secure critical data that drives the development of customer solutions and protect the privacy of our employees. • We comply with all applicable privacy and cybersecurity laws and regulation. • Our cybersecurity and data protection program includes the deployment of tools and activities designed to prevent, detect, and analyze current and emerging cybersecurity threats, and plans and strategies to address threats and incidents, including any associated with our use of third-party service providers. • We continually assess industry best practices, frameworks and standards and leverage them to advance our cybersecurity and data protection program’s maturity. • We employ periodic employee simulated phishing campaigns and perform regular internal/external security audits, vulnerability assessments, and penetration testing of our systems, products and practices affecting user data. • We conduct annual training programs on data privacy, cybersecurity, and insider threats for all employees and require annual certification that each employee has read our privacy policy. • Our incident response plan and cybersecurity landscape are tested annually by an external provider. | |||||||
Community Involvement | We promote the well-being of the communities in which the Company’s employees work and live. | |||||||
| • | We encourage employee involvement through charitable donations and volunteer programs. | ||||||
• | We support | |||||||
Governance | We maintain the highest ethical standards in interactions with employees, customers, suppliers, competitors, and the general public. | |||||||
• | Our Code of Conduct includes several important provisions on human rights, including prohibitions on human trafficking and the use of child labor or forced, bonded or indentured labor in our operations, as well as compliance with all applicable laws, including environmental. | |||||||
• | We are committed to responsible sourcing of materials for our products by not directly purchasing conflict minerals (tin, tantalum, tungsten, and gold) from the Democratic Republic of Congo and adjoining countries, which are at risk of being mined and sold under the control of armed groups to finance conflict, and not having direct relationships with mines or smelters that process these minerals. Our Conflict Minerals Policy Statement requires our suppliers to support us in monitoring the sourcing of conflict minerals. | |||||||
• | We maintain a strict supplier code of conduct that sets expectations about supplier behavior. | |||||||
• | We are a multi-national organization, and as such, compliance with business ethics, anti-bribery, and trade compliance laws is a key component of our ethics commitment to conduct business lawfully and ethically. Accordingly, we maintain policies and conduct annual global workforce training programs requiring employee certification on ethics and anti-bribery/trade compliance including the Foreign Corrupt Practices Act (FCPA) and UK Bribery Act, along with other critical risk areas, and we offer a global, multi-lingual, 24/7 anonymous ethics | |||||||
• | We conduct EH&S and financial audits of our facilities worldwide to ensure compliance with all applicable laws, regulations, policies, and procedures. • We maintain an Integrated Risk and Compliance program aligned with industry standards and regulatory requirements to support business objectives that integrates uniform risk management principles which are designed to identify, assess, prioritize, address, manage, monitor, and communicate risks across our operations to foster a culture of integrity and risk awareness. |
7 |
In support of the CSR, the Company maintains the following policies aimed at protecting the environment, health and safety, ethics and compliance with laws, respect for human rights, and supply chain management, all of which are available within the Governance section of the Company’s website at investors.curtisswright.com/https://curtisswright.com/investor-relations/governance/governance-documents/governance-documents or by sending a request in writing to the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036:
• |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| California Transparency in Supply Chains Act of 2010 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Code of Conduct | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Code of Conduct - Suppliers and Customers | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Conflict Minerals Policy Statement | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Corporate Social Responsibility | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Curtiss-Wright Corporation Standards for Suppliers: Environmental, Health and Safety, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Environmental, Health and Safety Values | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Human Trafficking and Slavery | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Anti-Slavery and Human Trafficking Statement 2020 |
By adhering to the principles contained in the CSR program, the Company enriches the economic, social, and environmental aspects of the communities in which the Company’s employees live and work, which enhances the profitability of the Company and benefits the Company’s stockholders, employees, stockholders, and customers.
8 |
6
CURTISS-WRIGHT CORPORATION
130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036
PROXY STATEMENT
PURPOSE
This Proxy Statement is being furnished in connection with the solicitation of proxies by the Board of Directors of Curtiss-Wright Corporation, a Delaware corporation (the “Company”), for use at the annual meeting of stockholders of the Company (the “Annual Meeting”) to be held on Thursday, May 6, 2021,2, 2024, at 1:00 p.m. local time, at the Homewood Suites by Hilton, 125 Harbour Place Drive, Davidson, North Carolina 28036, and at any adjournments or postponements thereof.
INTERNET AVAILABILITY OF PROXY MATERIALS
Pursuant to the rules adopted by the U.S. Securities and Exchange Commission (the “SEC”), the Company is furnishing proxy materials to its stockholders primarily via the internet, rather than mailing paper copies of these materials to each stockholder. On or about March 26, 2021,22, 2024, the Company will mail to each stockholder of record as of March 12, 20218, 2024 (other than those stockholders who previously had requested paper delivery of proxy materials) a Notice of Internet Availability of Proxy Materials containing instructions on how to access and review the proxy materials, including a Noticenotice and Proxy Statement and the Company’s combined Business Review/20202023 Annual Report on Form 10-K filed with the SEC. The Notice of Internet Availability of Proxy Materials also contains instructions on how to request a paper copy of the proxy materials. If you received a Notice of Internet Availability of Proxy Materials by mail, you will not receive a paper copy of the proxy materials unless you request one. If you would like to receive a paper copy of the proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy Materials. You can also choose to receive future proxy materials by email by following the instructions included in the Notice of Internet Availability of Proxy Materials. This will help the Company reduce the environmental impact and costs of printing and distributing paper copies and improve the speed and efficiency by which the Company’s stockholders can access these materials. If you choose to receive future proxy materials by email, you will receive an email next year with instructions containing a link to those materials and a link to the proxy-voting site. Your election to receive proxy materials by email will remain in effect until you revoke it. The Company may at its discretion voluntarily choose to mail or deliver a paper copy of the proxy materials, including a Notice and Proxy Statement and the combined Business Review/20202023 Annual Report on Form 10-K filed with the SEC, to one or more stockholders.
INFORMATION CONCERNING THE ANNUAL MEETING
Mailing and Solicitation.A Notice and Proxy Statement and combined Business Review/20202023 Annual Report on Form 10-K and accompanying form of proxy card attached hereto are being distributed or made available via the internet to the Company’s stockholders on or about March 26, 2021.22, 2024. For information about stockholders’ eligibility to vote at the Annual Meeting, please see “Record Date and Outstanding StockStock”” below. The Company will pay the cost of the solicitation of proxies. The solicitation is to be made primarily by mail but may be supplemented by telephone calls and personal solicitation by officers and other employees of the Company. The Company will reimburse banks and nominees for their expenses in forwarding proxy materials to the Company’s beneficial owners.
Proxies. Whether or not you plan to attend the Annual Meeting, the Company requests that you vote prior to the Annual Meeting: (i) via the internet, by following the instructions provided in the Notice of Internet Availability of Proxy Materials, (ii) via telephone, by following the instructions provided in the Notice of Internet Availability of Proxy Materials, or (iii) via mail, by completing, signing, dating and mailing a paper proxy card in a postage-paid return envelope, which a stockholder can request as outlined in the Notice of Internet Availability of Proxy Materials. A control number, contained in the
9 |
Notice of Internet Availability of Proxy Materials, is designed to verify your identity, and allow you to vote your shares, and confirm that your voting instructions have been properly recorded.
7
If your shares are registered directly in your name, you are the holder of record of these shares and the Company is sending a Notice of Internet Availability of Proxy Materials directly to you. As the holder of record, you have the right to vote by one of the three ways mentioned above or in person at the Annual Meeting. If your shares are held in “street name”, your bank, broker, or other nominee will send to you a Notice of Internet Availability of Proxy Materials. As a holder in street name, you have the right to direct your bank, broker, or other nominee how to vote by submitting voting instructions in the manner directed by your bank, broker, or other nominee. If you hold shares in street name and you wish to vote in person at the Annual Meeting, you must obtain a proxy issued in your name from your bank, broker, or other nominee and bring that proxy to the Annual Meeting.
Broker non-votes. Under the rules of the New York Stock Exchange (“NYSE”), a bank, broker, or other nominee who holds shares in “street name” for customers is precluded from exercising voting discretion with respect to the approval of non-routine matters (so called “broker non-votes”) in the absence of specific instructions from such customers. The (1) election of Directors (see Proposal One), (2) approval of the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan (See Proposal Three), and (3) the advisory (non-binding) vote to approve the compensation of the Company’s named executive officers (See Proposal Three)Four), are considered “non-routine” matters under applicable NYSE rules. Therefore, a bank, broker, or other nominee is not entitled to vote the shares of Company common stock unless the beneficial owner has given instructions. As such, there may be broker non-votes with respect to these proposals. On the other hand, the ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for 20212024 (see Proposal Two) is considered a “routine” matter under applicable NYSE rules. Therefore, a bank, broker, or other nominee will have discretionary authority to vote the shares of Company common stock if the beneficial owner has not given instructions and no broker non-votes will occur with respect to this proposal.
Voting In Accordance With Instructions. The shares represented by your properly submitted proxy received by mail, telephone, Internet, or in person will be voted in accordance with your instructions. If you are a registered holder and you do not specify in your properly submitted proxy how the shares represented thereby are to be voted, your shares will be voted:
(1) | “FOR” the election as Directors of the nominees proposed (see Proposal One), | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(2) | “FOR” the ratification of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3) | “FOR” approval of the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan (see Proposal Three), and | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(4) | “FOR” the compensation of the Company’s named executive officers under the proposal regarding the advisory (non-binding) vote to approve the compensation of the Company’s named executive officers (see Proposal |
If your shares are held in street name and you do not specify how the shares represented thereby are to be voted, your bank, broker, or other nominee may exercise its discretionary authority to vote on Proposal Two only.
The Board of Directors is not aware of any other matters to be presented for action at the Annual Meeting, but if other matters are properly brought before the Annual Meeting, shares represented by properly completed proxies received by mail, telephone, internet, or in person will be voted in accordance with the judgment of the persons named as proxies.
Signatures in Certain Cases. If a stockholder is a corporation or unincorporated entity such as a partnership or limited liability company, the enclosed proxy should be signed in its corporate or other entity name by an authorized officer or person and his or her title should be indicated. If shares are registered in the name of two or more trustees or other persons, the proxy must be signed by a majority of them. If shares are registered in the name of a decedent, the proxy should be signed by the executor or administrator and his or her title should follow the signature.
10 |
Revocation of Proxies.Whether the proxy is submitted via the internet, telephone, or mail, stockholders have the right to revoke their proxies at any time before a vote is taken. If your shares are registered in your name, you may revoke your proxy (1) by notifying the Corporate Secretary of the Company in writing at the Company’s address given above, (2) by executing a new proxy bearing a later date or by submitting a new proxy by telephone or the internet on a later date, provided the new proxy is received by Broadridge Financial Solutions Inc. (which will have a representative present at the Annual Meeting) before the vote, (3) by attending the Annual Meeting and voting in person, or (4)
8
by any other method available to stockholders by law. If your shares are held in street name, you should contact the record holder to obtain instructions if you wish to revoke your vote before the Annual Meeting.
Record Date and Outstanding StockStock.. The close of business on March 12, 20218, 2024 has been fixed as the record date of the Annual Meeting, and only stockholders of record at that time will be entitled to vote. The only capital stock of the Company issued and outstanding is the common stock, par value $1.00 per share (the “Common Stock”). As of March 12, 2021,8, 2024, there were 40,918,91038,280,037 shares of Common Stock issued and outstanding constituting all the capital stock of the Company entitled to vote at the Annual Meeting. Each stockholder is entitled to one vote for each share of Common Stock held.
Quorum. The presence, in person or by properly executed proxy, of the holders of a majority of the issued and outstanding shares of Common Stock entitled to vote at the Annual Meeting is necessary to constitute a quorum at the Annual Meeting.
Required Vote.
Election of Directors: A plurality of the Common Stock present in person or represented by proxy (and eligible to vote), at a meeting in which a quorum is present. This means that a person will be elected who receives the first through ninth highest number of votes, even if he or she receives less than a majority of the votes cast. However, under our corporate governance guidelines, in an uncontested election where the only nominees are those recommended by the Board, any nominee for director who receives a greater number of votes “withheld” from his or her election than votes “for” his or her election is required to tender his or her resignation following certification of the stockholder vote. The Committee on Directors and Governance is required to make recommendations to the Board with respect to any such letter of resignation. The Board is required to take action with respect to this recommendation and to disclose their decision-making process. Full details of this policy are set out under “Proposal One: Election of Directors” on page 1013 of this Proxy Statement.
Ratification of Deloitte & Touche LLP: The affirmative vote of a majority of the shares of Common Stock present in person or represented by proxy (and eligible to vote), at a meeting in which a quorum is present.
Advisory (non-binding vote) to approve the compensation This means that of the Company’s named executive officersshares represented at the Annual Meeting and entitled to vote, a majority of them must be voted “for” this proposal for it to be approved.
Approval of the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan: The affirmative vote of a majority of the shares of Common Stock present in person or represented by proxy (and eligible to vote), at a meeting in which a quorum is present. This means that of the shares represented at the Annual Meeting and entitled to vote, a majority of them must be voted “for” this proposal for it to be approved.
Advisory (non-binding vote) to approve the compensation of the Company’s named executive officers: The affirmative vote of a majority of the shares of Common Stock present in person or represented by proxy (and eligible to vote), at a meeting in which a quorum is present. This means that of the shares represented at the Annual Meeting and entitled to vote, a majority of them must be voted “for” this proposal for it to be approved.
Calculating Votes. Effect of Withhold Authority Votes, Abstentions and Broker Non-Votes.
Under the Delaware General Corporation Law (under which Curtiss-Wright Corporation is incorporated), an abstaining vote and a broker non-vote are counted as present and eligible to vote at the Annual Meeting and are, therefore, included for purposes of determining whether a quorum is present at the Annual Meeting.
11 |
With respect to election of directors (see Proposal One), if you “withhold” authority to vote with respect to one or more director nominees, your voteshares will not be voted and will have no effect on the election of such nominees.nominees because, under plurality voting rules, the nine director nominees receiving the highest number of “for” votes will be elected. A “withhold” vote is not considered a vote cast in director elections. Broker non-votes will have no effect on the election of the nominees.
With respect to the ratification of Deloitte & Touche LLP (see Proposal Two), if you “abstain”from voting with respect to this Proposal, your vote will have the same effect as a vote “against” the Proposal. Proposal. A bank, broker, or other nominee may exercise discretion to vote shares as to which instructions are not given on this Proposal and accordingly, no “broker non-votes” will occur with respect to this Proposal.
With respect to approval of the advisory vote to approve executive compensationCurtiss-Wright Corporation 2024 Omnibus Incentive Plan (see Proposal Three), if you “abstain”from voting with respect to this Proposal, your vote will have the same effect as a vote “against” such Proposal. Broker non-votes will not be counted as having voted either for or against this Proposal.
With respect to the advisory vote to approve executive compensation (see Proposal Four), if you “abstain” from voting with respect to this Proposal, your vote will have the same effect as a vote “against” such Proposal. Broker non-votes will not be counted as having voted either for or against this Proposal.
Dissenter’s Rights of AppraisalAppraisal.. The stockholders have no dissenter’s rights of appraisal under the Delaware General Corporation Law, the Company’s Restated Certificate of Incorporation, or the Company’s Amended and Restated By-Laws with respect to the matters to be voted on at the Annual Meeting.
9
PROPOSAL ONE: ELECTION OF DIRECTORS
General Information
At the date of this Proxy Statement, the Board of Directors of the Company (the “Board” or “Board of Directors”) consists of ten members, eightnine of whom are non-employee Directors. However, Albert E. Smith,S. Marce Fuller, who is presently a Director of the Company, has advised the Board of hisher decision to retire from the Board after almost 15with more than 24 years of service. Mr. Smith’sdistinguished service and leadership at Curtiss-Wright, which includes serving as Lead Independent Director for the past three years. Ms. Fuller’s term will expire just prior to the Annual Meeting. Mr. SmithMs. Fuller served on the Board with great distinction.
The Committee on Directors and Governance of the Board of Directors has recommended, and our full Board of Directors has nominated David C. Adams, Lynn M. Bamford, Dean M. Flatt, S. Marce Fuller, Bruce D. Hoechner, Glenda J. Minor, John B. Nathman,Anthony J. Moraco, William F. Moran, Robert J. Rivet, and Peter C. Wallace, and Larry D. Wyche, each currently serving Directors, to be elected to the Board for a one-year term. Pursuant to the Company’s Restated Certificate of Incorporation and in connection with the promotion of Lynn M. Bamford to President and Chief Executive Officer of the Company on January 1, 2021, the Board acting through a majority of Directors increased its membership by electing Ms. Bamford as a director on January 1, 2021. Additionally, the Committee on Directors and Governance of the Board has recommended, and our full Board has also nominated Anthony J. Moraco to be elected to the Board for a one-year term. Mr. Moraco is not currently serving as a Director of the Company and has never served in such capacity for the Company in the past. The Committee on Directors and Governance used the services of a third-party executive search firm to assist in identifying and evaluating Mr. Moraco as a nominee for Director. In the event that any nominee should become unavailable for election, the persons named in the proxy may vote for the election of a substitute nominee.
Directors will be elected by a plurality of votes properly cast (in person or by proxy) at the Annual Meeting. This means that a person will be elected who receives the first through ninth highest number of votes, even if he or she receives less than a majority of the votes cast. Therefore, stockholders who do not vote or withhold their vote from one or more of the proposed nominees and do not vote for another person, will not affect the outcome of the election provided that a quorum is present at the Annual Meeting. However, under our corporate governance guidelines, in an uncontested election of Directors where the only nominees are those recommended by the Board (which is the case for the election of Directors at this Annual Meeting), any nominee for director who receives a greater number of votes “withheld” from his or her election than votes “for” his or her election (a “Majority Withheld Vote”) is required to tender his or her resignation following certification of the stockholder vote. The Committee on Directors and Governance must promptly consider the resignation offer and a range of possible responses based on the circumstances that led to the Majority Withheld Vote, if known, and make a recommendation to the Board. The Board will act on the Committee on Directors and Governance recommendation within 90 days following certification of the stockholder vote. Thereafter,
12 |
the Board will promptly disclose its decision-making process and decision regarding whether to accept the Director’s resignation (or the reason(s) for rejecting the resignation offer, if applicable) in a Form 8-K filed with the SEC. Any Director who tenders his or her resignation pursuant to this provision will not participate in the Committee on Directors and Governance recommendation or the Board action regarding whether to accept or reject the resignation offer.
As further discussed in the section titled “Broker non-votesnon-votes”” on page 810 of this Proxy Statement, if you own shares of Common Stock through a bank, broker or other holder of record, you must instruct your bank, broker, or other holder of record how to vote in order for them to vote your shares of Common Stock so that your vote can be counted on this Proposal One.
10
Overview of Curtiss-Wright’s Current Board of Directors
The Board believes there are general requirements for service as a member of the Board that are applicable to all directors as laid out below, and other specialized characteristics that should be represented on the Board as a whole but not necessarily by each director. The specific qualifications, skills, experiences, and backgrounds of our director nominees are detailed in the section titled “Director Qualifications, Experiences, Backgrounds, and Diversity” on page 13 of this Proxy Statement.
Our Directors Exhibit: |
| |
High integrity |
| |
Loyalty to the Company and commitment to its success |
| |
Proven record of success |
| |
Knowledge of corporate governance and practices Our Directors Bring to the Boardroom: High level of leadership experience Specialized industry experience Financial expertise Extensive knowledge of the Company | Board Composition: Independent Directors: 9 of 10 Average Company Board Tenure: 6 years Average Age: 66 years Diversity of gender, race, ethnicity, or sexual orientation: 3 |
Our Directors Bring
Director Qualifications, Experiences, Backgrounds, and Diversity
The Company’s director nominees have substantial leadership, management, and industry experience and expertise in various fields. Three of the Company’s nine director nominees self-identify as having diverse characteristics (race, gender, ethnicity or sexual orientation). This diversity of experience and background of our director nominees, illustrated in the skills matrix and director nominees’ biographies that follow, is brought to bear in Board deliberations, during which multiple perspectives are considered in developing dynamic solutions to achieve the Company’s strategic priorities to reduce complexity, drive returns, and advance sustainably.
The skills matrix below summarizes the specific qualifications, skills, experiences, and backgrounds of each director nominee. While each director nominee is generally knowledgeable in each of these areas, an “X” in the skills matrix below indicates that the item is a specific qualification, skill, experience or attribute that the director nominee brings to the Boardroom:
High levelBoard. The lack of leadership experienceSpecialized industry experienceFinancial expertiseExtensive knowledge ofan “X” for a particular item does not mean that the Companydirector nominee does not possess that qualification, skill,
13 |
Set forth inexperience or attribute. Because the table belowskills matrix is only a summary, ofit does not include all the current Board’s collective qualifications, skills, experiences, backgrounds, and diversity:diversity that each director nominee offers.
Qualifications/Experiences/Backgrounds/Diversity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Director | Audit Committee Financial Expert | Extensive Knowledge of Company’s Business and Industry | Extensive M&A Experience | Broad International Experience | Other Public Company Board Experience | Current or Former CEO | Senior Leadership Experience | Gender/Ethnic/ Race/Sexual Orientation Diversity (a) | ||||||||||||||||||||||||||||||||||||||||||||||
Lynn M. Bamford |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||
| X | X | X | |||||||||||||||||||||||||||||||||||||||||||||||||||
Dean M. Flatt | X | X | X | X | ||||||||||||||||||||||||||||||||||||||||||||||||||
Bruce D. Hoechner | X | X | X | X | X | X | ||||||||||||||||||||||||||||||||||||||||||||||||
Glenda J. Minor | X | X | X | X | X | X | X | |||||||||||||||||||||||||||||||||||||||||||||||
Anthony J. Moraco | X | X | X | X | X | |||||||||||||||||||||||||||||||||||||||||||||||||
William F. Moran | X | X | X | |||||||||||||||||||||||||||||||||||||||||||||||||||
Robert J. Rivet | X | X | X | X | X | X | ||||||||||||||||||||||||||||||||||||||||||||||||
Peter C. Wallace | X | X | X | X | X | X | ||||||||||||||||||||||||||||||||||||||||||||||||
Larry D. Wyche | X | X | X | X |
|
| ||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
11
(a) | Self-identifies as having diverse characteristics (race, gender, ethnicity, or sexual orientation). |
In addition to gender, ethnic, race, and sexual orientation diversity, the Company also recognizes the value of other diverse attributes that directors may bring to the Board, including veterans of the U.S. military. The Company is proud to report that of our nine director nominees, three are also military veterans with over 77 years of combined service.
14 |
Information Regarding Nominees
Set forth below is information with respect to the nominees for Directors. Such information includes the principal occupation of each nominee for Director during, at least, the past five years, as well as a brief description of the particular experience, qualifications, attributes or skills that qualify the nominee to serve as a Director of the Company.
Chair and Chief Executive Officer Curtiss-Wright Corporation Age: 60 Director Since: 2021 Other Public Company Directorships: None Career Highlights: Ms. Bamford has | ||
Reasons for Election to the Board of Curtiss-Wright: Ms. Bamford has been an employee of the Company for more than |
12
15 |
Dean M. Flatt Retired President and Chief Operating Officer Honeywell International Inc., Age: 73 Director Since: 2012 Committees: Finance (Chair); Executive Compensation Other Public Company Directorships: Ducommun Incorporated (2009 – present) Career Highlights: Mr. Flatt served as President and Chief Operating Officer of Honeywell International Inc.’s Defense and Space business from July 2005 to July 2008. Prior to that, he served as President of Honeywell International Inc.’s Aerospace Electronics Systems business from December 2001 to July 2005 and served as President of Honeywell International Inc.’s Specialty Materials and Chemicals business from July 2000 to December 2001. Further, he serves as a director of Ducommun Incorporated since January 2009 where he currently serves as Chairman of the Compensation Committee and as Lead Director. Ducommun is a leading provider of engineered products and aftermarket services across various industries, including aerospace and defense. He Reasons for Election to the Board of Mr. Flatt has an in-depth understanding of the aerospace |
16 |
Retired President and Chief Executive Officer Rogers Corporation Age: 64 Director Since: 2017 Committees: Committee on Directors and Other Public Company Directorships: Ingevity Corporation Rogers Corporation (2011 – 2023) Career Highlights: Mr. Hoechner served |
13
Reasons for Election to the Board of Mr. Hoechner has many years of broad leadership experience across numerous geographies, businesses, and functions with particularly strong international |
17 |
Glenda J. Minor Chief Executive Officer and Principal Silket Advisory Services Age: 67 Director Since: 2019 Committees: Audit; Committee on Directors and Governance Other Public Company Directorships: Albermarle Corporation (2019 – present) Radius Recycling, Inc. f/k/a Schnitzer Steel Industries, Inc. (2020 – present) Career Highlights: Ms. Minor has served as Chief Executive Officer and Principal of Silket Advisory Services, a privately owned consulting firm, since 2016. Silket Advisory Services advises companies on financial, strategic, and operational initiatives. From Reasons for Election to the Board of Ms. Minor has many years of broad financial and international leadership experience across different industries and different continents, which have provided her with an in-depth understanding of the preparation and analysis of financial statements, and invaluable experience in capital market transactions, accounting, treasury, investor relations, financial and strategic planning, and business expansion. She is also financially literate in accordance with NYSE listing standards and an “audit committee financial expert” in accordance with SEC regulations. Ms. Minor’s extensive financial knowledge will be an invaluable asset to the Board in its oversight of the integrity of the Company’s financial statements and the financial reporting process. Additionally, Ms. Minor’s experience in mergers and acquisitions and business expansion provides the Company a competitive advantage in seeking new strategic business opportunities and platforms for its products and services. |
14
18 |
Anthony J. Moraco Retired Chief Executive Officer and former Director Science Applications International Corporation Age: 64 Director Since: 2021 Committees: Executive Compensation; Finance Other Public Company Directorships: Science Applications International Corporation (2013 – 2019) Career Highlights: Mr. Moraco served as Chief Executive Officer and a member of the Board of Directors of Science Applications International Corporation (SAIC), a NYSE-listed company, from September 2013 to July 2019, after its separation from its former parent Leidos Holdings, Inc. SAIC is a leading provider of technical, engineering, and enterprise information technology (IT) solutions and services primarily to the U.S. government. Prior to this time, he served in various leadership positions at Leidos (legacy SAIC), including serving as President of its Government Solutions Group in 2013, as Group President of its Intelligence, Surveillance and Reconnaissance organization from 2012 to 2013, as its Executive Vice President for Operations and Performance Excellence from 2010 to 2012, and as Senior Vice President and General Manager of its Space and Geospatial Intelligence Business Unit from 2007 to 2010. Leidos is a leading science, engineering and IT company that provides services and solutions in the defense, intelligence, civil and health markets. Reasons for Election to the Board of Curtiss-Wright: Mr. Moraco has an in-depth understanding of the aerospace and defense industry, evidenced by his past employment at SAIC and Leidos, as well as his previous leadership roles at the Boeing Company Space & Intelligence Mission Systems and Phantom Works. In addition, Mr. Moraco has extensive experience in U.S. government contracting. Mr. Moraco’s market knowledge, leadership skills, financial acumen, and operational management ability proven during his tenure as CEO of SAIC and as an executive of Leidos, along with his prior public company board experience, enhances Mr. Moraco’s contributions and |
19 |
Admiral (Ret.) President WFM Advisors, LLC Age: 65 Director Since: 2023 Committees: Executive Compensation; Finance Other Public Company Directorships: None Career Highlights: Admiral Moran has served Reasons for Election to the Board of Curtiss-Wright: Admiral Moran has many years of broad leadership and operational experience while serving in the U.S. Navy. |
15
20 |
Robert J. Rivet Retired Executive Vice President, Chief Operations and Administrative Officer Advanced Micro Devices, Inc. Age: 69 Director Since: 2011 Committees: Audit (Chair); Executive Compensation Other Public Company Directorships: None Career Highlights: Mr. Rivet served as Executive Vice President, Chief Operations and Administrative Officer of Advanced Micro Devices, Inc., a leading global semiconductor company, from October 2008 to February 2011, and Reasons for Election to the Mr. Rivet has 35 years of broad financial and international leadership experience across different technology industries, which has provided him an in-depth understanding of the preparation and analysis of financial statements, |
21 |
Peter C. Wallace Retired Chief Executive Officer and former Director Gardner Denver Age: 69 Director Since: 2016 Committees: Committee on Directors and Governance (Chair); Finance Other Public Company Directorships: Applied Industrial Technologies, Inc. (2005 – present) Rogers Corporation (2010 – present) Career Highlights: Mr. Wallace served as Chief Executive Officer and a Director of Gardner Denver Inc. from June 2014 until his retirement as of January 1, 2016. Gardner Denver (now merged with Ingersoll Rand’s Industrial segment and renamed Ingersoll Rand Inc.) is an industrial manufacturer of compressors, blowers, pumps, and other fluid control products used in numerous global end markets. Prior to joining Gardner Denver, Mr. Wallace was President and Chief Executive Officer, and a Director, of Robbins & Myers, Inc., from 2004 until it was acquired in February 2013 by National Oilwell Varco, Inc. Robbins & Myers was a leading designer, manufacturer, and marketer of highly engineered, application-critical equipment and systems for energy, chemical, pharmaceutical, and industrial markets worldwide. Mr. Wallace is also Reasons for Election to the Mr. Wallace has a wide and varied background as a senior executive, including having served as CEO of several leading companies in global industrial equipment manufacturing, |
16
Directorships at Public Companies
The following table sets forth any directorships at other public companies and registered investment companies held by each Director and nominee for Director at any time during the past five years.
22 |
| ||
|
| |
|
| |
|
| |
|
Director Since: 2023 Committees: Audit; Committee on Directors and Governance Other Public Company Directorships: None Career Highlights: Lt. Gen. Wyche serves as Chief Executive Officer of Wyche Leadership and Federal Contracting Consulting, a privately-owned consulting firm, since 2017. Prior to this, Lt. Gen. Wyche had a long, distinguished career in the U.S. Army serving at various times in increased senior leadership positions. From 2015 to 2017, he served as Deputy Commanding General, U.S. Army Materiel Command; from 2012 to 2014, he served as Commanding General, Combined Arms Support Command; from 2010 to 2012, he served as Deputy Chief of Staff for Operations, U.S. Army Materiel Command; from 2008 to 2010, he served as Commanding General, Joint Munitions Command; and from 2002 to 2008, he completed two tours at the Pentagon serving as Director for Supply Chain Strategy & Integration, and Chief of Supply Chain & Logistics Programs. He currently serves as a Director at Ready One Industries, | |
|
| |
|
|
23 |
There are no family relationships between any of the Company’s Directors, executive officers, or persons nominated or chosen by the Company to become a director or executive officer.
Certain Legal Proceedings
None of the Company’s Directors, executive officers, or persons nominated or chosen by the Company to become a director has been, during the past ten years: (i) involved in any bankruptcy petition filed by or against such person or any business of which such person was a general partner or executive officer, either at the time of the bankruptcy or within two years prior to that time; (ii) convicted of any criminal proceeding or subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (iii) subject to any order, judgment, or decree, not subsequently reversed, suspended, or vacated, of any court of competent jurisdiction or Federal or State authority, permanently or temporarily enjoined, barred, suspended, or otherwise limited from involvement in any type of business, securities, futures, commodities, or banking activities; (iv) found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; (v) subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended, or vacated, related to an alleged violation of securities or commodities law or regulation; any law or regulation respecting financial institutions or insurance companies; or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or (vi) the subject of, or a party to, any sanction or order, not subsequently reversed, suspended, or vacated, of any self-regulatory organization, any registered entity of the Commodity Exchange Act or any equivalent exchange, association, entity, or organization that has disciplinary authority over its members or persons associated with a member.
Compensation of Directors
For information concerning compensation of our Directors, please see “Compensation of Directors” on page 5975 of this Proxy Statement.
17
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS ATHAT
STOCKHOLDERS VOTE FOR THE ELECTION OF EACH“FOR ALL” OF THE COMPANY’S DIRECTOR
NOMINEES FOR DIRECTORLISTED ABOVE (PROPOSAL 1).
STRUCTURE AND PRACTICES OF THE BOARD OF DIRECTORS
Corporate Governance Guidelines and ComplianceCode of Conduct
The Board of Directors has adopted corporate governance guidelines that provide the framework for the governance of the Company.Company and contains a code of conduct that applies to every Director. The corporate governance guidelines are available within the Corporate Governance section of the Company’s website athttps://investors.curtisswright.com/curtisswright.com/investor-relations/governance/governance-documents or by sending a request in writing to the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036.
The corporate governance guidelines address, among other things, standards for Director independence, meetings of the Board, executive sessions of the Board, committees of the Board, the compensation of Directors, duties of Directors to the Company and its stockholders, and the Board’s role in management succession.succession, and includes policies on, among other things, conflicts of interest, corporate opportunities, and insider trading. The BoardCommittee on Directors and Governance reviews these principles and other aspects of governance annually.on a regular basis and is amended as the Board deems appropriate upon the recommendation of the Committee on Directors and Governance for updates in response to changing regulatory requirements and as business circumstances warrant.
24 |
The Company also maintains a code of conduct that applies to every employee, including the Company’s Chair and Chief Executive Officer, Chief Financial Officer, and Corporate Controller. The Company’s code of conduct includes policies on, among other things, employment, conflicts of interest, financial reporting, the protection of confidential information, insider trading and hedging, and requires strict adherence to all laws and regulations applicable to the conduct of the Company’s business. The Company’s code of conduct is available within the Corporate Governance section of the Company’s website at https://curtisswright.com/investor-relations/governance/governance-documents or by sending a request in writing to the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036. The Company reviews the code of conduct at least annually and it is amended as appropriate for updates to changing regulatory requirements and as business circumstances warrant.
The Company designed the corporate governance guidelines and the code of conduct to ensure that its business is conducted in a consistently legal and ethical manner. The Company will disclose any waivers or amendments of the codes of conduct pertaining to Directors or the Company’s Chief Executive Officer, Chief Financial Officer, and Corporate Controller on its website at www.curtisswright.com in accordance with applicable law and the requirements of the NYSE corporate governance standards. To date, no waivers have been requested or granted and no amendments have been made requiring disclosure.
To enhance understanding of and compliance with the Company’s code of conduct, the Company has undertaken several additional steps. Through a third-party provider, the Company maintains an online training program in multiple languages that is annually circulated to all Company employees to enhance the Company’s culture of ethical business practices. In addition, although all employees are encouraged to personally report any ethical concerns without fear of retaliation, the Company, through a third-party provider, maintains the Company’s Hotline (the “Hotline”) to allow employees to report concerns they are uncomfortable discussing directly with managers or human resources personnel. The Hotline is a global, multi-lingual, toll-free telephone and web-based system through which employees may report concerns confidentially and anonymously and is available 24 hours a day, seven days a week. The Hotline also serves as the vehicle through which employees may communicate with the Audit Committee confidentially and anonymously regarding any accounting, internal controls, or auditing concerns.
The Company continually assesses its ethics program, including training opportunities, and modifies as appropriate. The Company’s managers and supervisors play an important role in reinforcing the Company’s policies and commitment to ethics by setting the example of ethical conduct and providing employees with continuous training, education and resources that support the policies.
Meetings of the Board
The Board has regularly scheduled meetings each year, and also hold special meetings are heldand act by written consent from time to time as necessary. In addition, management and the Directors communicate informally on a variety of topics, including suggestions for Board or committee agenda items, recent developments, and other matters of interest to the Directors. Each Director has full access to management.
A meeting of the Company’s non-employee Directors in executive session without any employee Directors or members of management present is scheduled at every regularly scheduled Board and Committee meeting. During 2020,2023, the non-employee Directors met sevenat least five times in executive session. In May 2018, Albert E. Smith was appointed byThe Committees of the Board to serve as Lead Independent Director for suchmay also meet in executive sessions for a termsession at the end of three years being renewed every year until 2021, or until his successor is appointed. The Board renewed Mr. Smith’s term as Lead Independent Director in May 2020.each Committee meeting. In February 2021, S. Marce Fuller2024, Robert J. Rivet was appointed by the Board to serve as Lead Independent Director effective May 20212024 for a term of three years being renewed everyone year until 2024 or until herhis successor is appointed. The Lead Independent Director reviews the agenda items from the meeting with all non-employee Directors and leads discussions with the independent Board members and coordinates follow up discussions with management. For a further discussion on the position of Lead Independent Director, please read the section titled “Board Leadership Structure”beginning on page 2229 of this Proxy Statement.
Directors are expected to attend all meetings of the Board and each committee on which they serve. In 2020,2023, the Board held tenseven meetings and committees of the Board held a total of 18 17
25 |
meetings. During 2020,2023, no Director attended less than 75% of the aggregate number of meetings of the Board of Directors and of the committee or committees on which he or she served, during the period that he or she served.
The Company does not have a formal policy with respect to Director attendance at the annual meeting of stockholders. The Company believes that the potential expense involved with requiring all non-employee Directors are encouraged to attend the annual meeting of stockholders, outweighs the benefit ofalthough such attendance because meeting agenda items are generally uncontested, nearly all shares voted are voted by proxy, and stockholder attendance at the meetings is traditionally very low. Accordingly, no non-employee Directors attended the Company’s 2020 annual meeting of stockholders. David C. Adams, the Company’s then Chairman and Chief Executive Officer, did attend the Company’s 2020 annual meeting of stockholders. Mr. Adams, the Company’s Executive Chairman, and Ms.not mandatory. Lynn M. Bamford, the Company’s PresidentChair and Chief Executive Officer, attended the Company’s 2023 annual meeting of stockholders. Ms. Bamford will attend the Company’s 20212024 annual meeting of stockholders where theyshe will be available for questions.
18
The Company believes communications between the Board and the Company’s stockholders, employees, and other interested parties is an important part of the corporate governance process. Stockholders, employees, and other interested parties wishing to contact the Board directly may initiate in writing any communication with: (i) the Board, (ii) any committee of the Board, (iii) the non-employee Directors as a group, or (iv) any individual non-employee Director by sending the communication to Lead Independent Director, c/o Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036. The name of any specific intended Board recipient should be noted in the communication. However, priorPrior to forwarding any correspondence, the Lead Independent Director will review such correspondencecorrespondence. Any communications received by the Lead Independent Director regarding concerns relating to accounting, internal controls or auditing matters will promptly be brought to the attention of the Audit Committee and will be handled in accordance with the procedures established by the Audit Committee to address these matters. However, the Lead Independent Director, in his or her discretion, will not forward certain items if they are deemed inappropriate for submission, including, without limitation, solicitations, commercial advertisements, communications that do not relate directly or indirectly to be of a commercial naturethe Company’s business or that relate to improper or irrelevant topics, or are sent in bad faith. Directors may at any time review a log of all correspondence received by the Company that is addressed to any director and request copies of any such correspondence.
Director Independence
The corporate governance guidelines provide independence standards generally consistent with the New York Stock Exchange listing standards. These standards specify the criteria by which the independence of the Company’s Directors will be determined and require the Board annually to determine affirmatively that each independent Director has no material relationship with the Company other than as a Director. The Board has adopted the standards set out in the corporate governance guidelines, which are posted within the Corporate Governance section of the Company’s website at https: https://investors.curtisswright.com/curtisswright.com/investor-relations/governance/governance-documents,, for its evaluation of the materiality of any Director relationship with the Company. To assist in the Board’s determination, each Director completed a questionnaire designed to identify any relationship that could affect the Director’s independence. Based on the responses received from the Directors to the questionnaires and the standards described above, the Board has determined that the following nominees for Directors are “independent” as required by the New York Stock Exchange listing standards and the Board’s corporate governance guidelines: Dean M. Flatt, S. Marce Fuller, Bruce D. Hoechner, Glenda J. Minor, John B. Nathman,Anthony J. Moraco, William F. Moran, Robert J. Rivet, and Peter C. Wallace. Mr. AdamsWallace, and Larry D. Wyche. Ms. Bamford dodoes not meet the corporate governance guidelines independence test and NYSE independence listing standards due to theirher current positionsposition as Executive Chairman and PresidentChair and Chief Executive Officer of the Company, respectively. The Board has also determined that Anthony J. Moraco, a non-Director nominee, is “independent” as required by the New York Stock Exchange listing standards and the Board’s corporate governance guidelines.Company. In making the determination that Messrs. Flatt and Wallace are “independent”, the Board considered the fact that these Directors are presently a director of certain entities infrom which the Company at various times has purchased goods and/or services. The Board determined that this relationship as a director is not material and, thus, did not affect their independence, because each of them do not participate in the day-to-day management of those entities, and do not receive any remuneration as a result of the goods and/or services being sold. Moreover, the transactions involved payments that are individually and in the aggregate immaterial to the revenues of each entity and the expenses of the Company.
26 |
There were no other transactions, relationships, or arrangements not otherwise disclosed that were considered by the Board of Directors in determining whether any of the Directors are independent.
All members of the Audit Committee, the Executive Compensation Committee, the Finance Committee, and the Committee on Directors and Governance are independent Directors as defined in the New York Stock Exchange listing standards and in the standards in the Company’s corporate governance guidelines.
The corporate governance guidelines contain a code of conduct that applies to every Director. The Company also maintains a code of conduct that applies to every employee, including the Company’s Executive Chairman, President and Chief Executive Officer, Chief Financial Officer, and Corporate Controller. The Company designed the corporate governance guidelines and the code of conduct to ensure that its business is conducted in a consistently legal and ethical manner. The corporate governance guidelines include policies on, among other things, conflicts of interest, corporate opportunities, and insider trading. The Company’s code of conduct applicable to all of its employees includes policies on, among other things, employment, conflicts of interest, financial reporting, the
19
protection of confidential information, insider trading and hedging, and requires strict adherence to all laws and regulations applicable to the conduct of the Company’s business. The Company will disclose any waivers or amendments of the codes of conduct pertaining to Directors or the Company’s Chief Executive Officer, Chief Financial Officer, and Corporate Controller on its website at www.curtisswright.comin accordance with applicable law and the requirements of the NYSE corporate governance standards. To date, no waivers have been requested or granted and no amendments have been made requiring disclosure. The Company’s code of conduct is available within the Corporate Governance section of the Company’s website at https://investors.curtisswright.com/governance/governance-documents or by sending a request in writing to the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Davidson, North Carolina 28036.
In order to enhance understanding of and compliance with the Company’s code of conduct, the Company has undertaken several additional steps. Through a third-party provider, the Company maintains an on-line training program that is annually circulated to all Company employees in order to enhance the Company’s culture of ethical business practices. In addition, although all employees are encouraged to personally report any ethical concerns without feareach member of retribution, the Company, through a third-party provider, maintains the Company’s Hotline (the “Hotline”), a toll-free telephone and web-based system through which employees may report concerns confidentially and anonymously. The Hotline facilitates the communication of ethical concerns and serves as the vehicle through which employees may communicate with the Audit Committee meets the independence requirements under Rule 10A-3 under the Securities Exchange Act of 1934. Furthermore, all members of the Board confidentially and anonymously regarding any accounting or auditing concerns.Executive Compensation Committee qualify as “non-employee directors” for purposes of Rule 16b-3 under the Securities Exchange Act of 1934.
Board Committees
The Board of Directors has an Audit Committee, an Executive Compensation Committee, a Committee on Directors and Governance, and a Finance Committee. The Board may establish other special or standing committees from time to time. The Board has adopted a written charter for each of these committees.four standing committees that satisfies the applicable standards of the New York Stock Exchange and the SEC. Each committee reviews its charter at least annually, and as regulatory developments and business circumstances warrant. Each of the committees considers revisions to its respective charter from time to time to reflect evolving best practices. The full text of each charter is available within the Corporate Governance section of the Company’s website at https:https://investors.curtisswright.com/curtisswright.com/investor-relations/governance/governance-documentsor by sending a request in writing to the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036. The current membership of each committee is as follows:
Director | Audit Committee | Executive Compensation Committee | Committee on Directors and Governance | Finance Committee | ||||||||||||||||||||||||
| X |
| X | (1) | ||||||||||||||||||||||||
S. Marce Fuller | X |
| (1) |
|
| |||||||||||||||||||||||
|
|
| ||||||||||||||||||||||||||
|
| X | X |
| ||||||||||||||||||||||||
|
|
| ||||||||||||||||||||||||||
Glenda J. Minor | X |
| X |
| ||||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||
| X |
|
| |||||||||||||||||||||||||
| X |
|
| |||||||||||||||||||||||||
William F. Moran | X | X | ||||||||||||||||||||||||||
Robert J. Rivet | X | (1) | X | |||||||||||||||||||||||||
Peter C. Wallace |
| X | (1) | X | ||||||||||||||||||||||||
Larry D. Wyche | X | X |
(1) |
| Denotes Chairperson |
Audit Committee. The Audit Committee presently consistsconsisted of four non-employee directors. The Audit Committee met six times during 2020. Each member of the Audit Committee meets the independence requirements of the New York Stock Exchange, Rule 10A-3 under the Securities Exchange Act of 1934, and the Company’s corporate governance guidelines.2023. In accordance with New York Stock Exchange requirements, the Board in its business judgment has determined that each member of the Audit Committee is financially literate, knowledgeable, and qualified to review financial statements. The Board has also determined that at least two members of the Audit Committee, Robert J. Rivet and Glenda J. Minor, are an “audit committee financial expert” as defined in the rules of the SEC.
The Audit Committee’s primary responsibilities include assisting the Board in fulfilling its oversight responsibility relating to the integrity of the Company’s financial statements and the financial reporting
20
process; the systems of internal accounting and financial controls; the qualifications and performance of the Company’s internal audit function and internal auditors; the annual independent audit of the Company’s financial statements; the appointment and retention (subject to stockholder ratification), compensation, performance, qualifications, and independence of the Company’s independent registered public accounting firm; enterprise risk assessment and management; review of the Company’s cybersecurity, information security, data protection and technology program (including cybersecurity);programs; the Company’s compliance with legal and regulatory requirements (including environmental matters) and the adequacy and performance of its ethics program; and the impact of COVID-19 on the Company and the Company’s actions in response.compliance with its financial policies.
27 |
Executive Compensation Committee. The Executive Compensation Committee presently consistsconsisted of fourfive non-employee directors. The Executive Compensation Committee met sixfive times during 2020. Each member of the Executive Compensation Committee meets the independence requirements of the New York Stock Exchange and the Company’s corporate governance guidelines.2023.
The Executive Compensation Committee’s primary responsibilities includes determining the total compensation, including base salary and shortshort- and long termlong-term incentive compensation and all benefits and perquisites, of the Chief Executive Officer and recommends to the full Board the total compensation levels for the remaining executive officers of the Company.all Named Executive Officers. The Executive Compensation Committee also oversees the administration of the Company’s executive compensation programs, including any compensation actions taken in response to the COVID-19 pandemic, and further reviews and evaluates compensation arrangements to assess whether they could encourage undue risk taking. In addition, the Executive Compensation Committee oversees the Company’s policies on the recoupment of incentive compensation in the event of certain accounting restatements. Furthermore, the Executive Compensation Committee oversees the development, implementation and effectiveness of the Company’s strategies and policies related to human capital development. In fulfilling its responsibilities, the Executive Compensation Committee may retain a consultant and during 2020,2023, the Executive Compensation Committee used the services of Frederic W. Cook & Co., Inc., an independent compensation consultant, to assist and guide the Executive Compensation Committee. For a discussion concerning the process and procedures for the consideration and determination of executive compensation and the role of executive officers and compensation consultants in determining or recommending the amount or form of compensation, see “Compensation Discussion and AnalysisAnalysis”” beginning on page 3140 of this Proxy Statement.
Committee on Directors and Governance.Governance. The Committee on Directors and Governance presently consistsconsisted of four non-employee directors. The Committee on Directors and Governance met three times during 2020.2023. The Committee on Directors and Governance primary responsibilities includesinclude developing policy on the size and composition of the Board, oversight responsibility relating to the risks associated withof the Company’s Environmental, Social, and Governance requirements,(ESG) program generally (including the Company’s response to climate change and sustainability, employee safety, and human capital such as diversity, equity and inclusion), criteria for Director nomination,nominations, procedures for the nomination process, procedures for the Board and Committee self-assessment process, and review of compensation paid to non-employee Directors. TheIn addition, the Committee on Directors and Governance will also oversee any public emissions and climate-related disclosures that may be disclosed by the Company, including the establishment and periodic review of internal controls and procedures related to such disclosures to ensure the integrity of disclosed quantitative data. Furthermore, the committee also identifies and recommends candidates for election to the Board. Further,Moreover, the committee regularly reviews the Company’s corporate governance guidelines and Committee charters and provides oversight of the corporate governance affairs of the Board and the Company consistent with the long-term best interests of the Company and its stockholders. Each member of the Committee on Directors and Governance meets the independence requirements of the New York Stock Exchange and the Company’s corporate governance guidelines.
Finance Committee.The Finance Committee presently consistsconsisted of fourfive non-employee directors. The Finance Committee met three times during 2020.2023. The Finance Committee’s primary responsibilities includes advising the Board regarding the capital structure of the Company, balanced capital allocation policy, the Company’s dividend and stock repurchase policies, the Company’s currency risk and hedging programs, and the investment managers and policies relating to the Company’s defined benefit plans. Each member of the Finance Committee meets the independence requirements of the New York Stock Exchange and the Company’s corporate governance guidelines.
Board and Board Committees Self-Evaluation Process
The Board recognizes that a thorough, constructive self-evaluation process enhances its effectiveness and is an essential element of good corporate governance. Accordingly, the Committee on Directors and Governance oversees an annual self-evaluation process to ensure that the full Board and each of its committees conducts a thorough self-assessment of its performance and solicits feedback for improvement. In addition, the Board and its committees meet regularly in executive session throughout the year to consider areas that may warrant additional focus and
21
attention. The Committee on Directors and Governance reviews and reassesses the format and effectiveness of the evaluation process each year and makes changes when considered necessary or appropriate.
During 2020,2023, the evaluations were conducted through the use ofusing a detailed on-line survey designed to offer a thoughtful and substantive reflection on the Board and committees’ performance. The survey considers various topics related to Board and committee composition, structure, effectiveness, performance, and
28 |
responsibilities, as well as the overall mix of director skills, experience, backgrounds, and diversity. The results of the survey were aggregated, summarized by the General Counsel, and presented to the Board and each committee for discussion in executive session. In addition to providing an opportunity for directors to discuss a wide range of governance-related topics, the evaluation process is used by the Board and each committee to identify opportunities for improvement, make changes to the committee charters, processes, and policies, and is linked to the Board’s succession planning activities.
In response to feedback solicited from the Board and committees over the past several years, the Company continues to:
• | Streamline meeting materials to better highlight important information, while maintaining completeness | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Allow sufficient time during Board and committee meetings for discussion, debate, in-depth reviews, and executive sessions | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Enhance discussion about areas of emerging risk at Board and Audit Committee meetings, including deep dives on key topics at Board risk oversight sessions | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Provide educational opportunities during regularly scheduled meetings and through third-party programs | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Focus on particular skills, background, attributes, and |
The Board of Directors believes that through its annual self-evaluation, the Board of Directors will continue to evolve to meet the Company’s long-term strategic needs and the interests of the Company’s stockholders.
Board Leadership Structure
The Company is focused on strong corporate governance practices and values independent Board oversight as an essential component of strong corporate performance to enhance stockholder value. The Company’s commitment to independent oversight is demonstrated by the independence of all directors, except for our Executive Chairman and PresidentChair and Chief Executive Officer who is also a Director.Officer. In addition, as discussed above, all of the members of the Board’s Audit Committee, Finance Committee, Executive Compensation Committee, and Committee on Directors and Governance are independent.
The Board does not have a formal policy regarding the separation of the roles of the Chair of the Board and the Chief Executive Officer. The Board believes that each businessevery company is unique, and therefore, the appropriate board leadership structure will depend upon eacha company’s unique circumstances and needs at thea particular time. Historically, the positions of Board Chairman and Chief Executive Officer of the Company were generally held by the same individual. This practice changed temporarily beginning January 1, 2021 as then Chairman and Chief Executive Officer David C. Adams began a 17-month phased retirement. On January 1, 2021, Mr. Adams resigned from the Chief Executive Officer position, and as of January 1, 2021, Lynn M. Bamford was promoted to the positions of President and Chief Executive Officer and serves as a member of the Board. Mr. Adams will serve as Executive Chairman until his full retirement from the Company in May 2022. The Board believes this temporary division of the Chief Executive Officer and Board Chairman positions during this transition period will contribute to the smooth transition of the Company’s top executive leadership position to Ms. Bamford, enabling Ms. Bamford to focus her time and energy on running the day-to-day operations of the Company at a time when Ms. Bamford is relatively new to the role, while at the same time ensuring that Mr. Adams’ valuable experience, wise judgement, and service would remain available to the Company during the transition period. Following completion of the management transition in May 2022, it is expected the positions of Chairman and Chief Executive Officer will again reside in one individual, Ms. Bamford. The Board believes at that time it will be in the best interest of the Company and its stockholders for one personMs. Bamford to serve as Board Chairman and Chief Executive Officer. Ms. Bamford has been an employee of the Company for more than 16 years, having served in increasing levels of strategic, operational, and managerial
22
responsibility. She possesses in-depth managerial and operational knowledge of the Company and its industries, as well as the issues, opportunities, and challenges it faces. Thus, she will be best positioned to provide direction and highlight issues that ensure the Board of Directors’ time and attention are focused on the most critical matters. In addition, the Board has determined that this leadership structure is optimal because it believes that having one leader serving as both ChairmanChair and Chief Executive Officer, fosters decisive leadership, accountability, effective decision-making, and alignment on corporate strategy. Having one person serve as Chairman and Chief Executive Officer also enhances the Company’s abilityMs. Bamford is well suited to communicate its message and strategy clearly and consistently to its stockholders, employees, customers, and suppliers. In light of Ms. Bamford’sfill that role given her experience and knowledge of the Company’s business and industries, herindustries. The Board believes Ms. Bamford’s ability to speak thenserve as both ChairmanChair and Chief Executive Officer will provide the Company with strong unified leadership. The BoardHowever, consistent with good corporate governance principles, the Committee on Directors and Governance will continue to monitorreview periodically this issue to determine whether, based on the appropriatenessrelevant facts and circumstances at such future times, separation of this structure.the offices of Chair of the Board and Chief Executive Officer would better serve the interests of the Company and its stockholders.
Mr. Adams
The Board does not believe its independence is compromised by having a single person serve as Chair and Chief Executive Officer. The functions of the Board are carried out by the full Board, and when delegated, by the Board committees. Currently, all the Company’s Directors (other than Ms. Bamford) and each member of our four Committees meet the independence requirements of the NYSE and our Corporate Governance Guidelines’ categorical standards for determining Director independence. Additionally, the members of the Audit Committee also satisfy SEC regulatory independence requirements for audit committee members. Furthermore, the members of the Executive Compensation Committee also qualify as ‘non-employee directors” under SEC rules. Each Director is a full and equal participant in the major strategic and policy decisions of the Company and the Chair has no greater or lesser vote on matters considered by the Board. Our non-management Directors meet in
29 |
executive session without management (including the Chair and Chief Executive Officer) on a regularly scheduled basis, with the Lead Independent Director presiding in such sessions. During executive sessions, the Directors may consider such matters as they deem appropriate. Following each executive session, the results of the deliberations and any recommendations are communicated to the full Board of Directors.
Because Ms. Bamford serves as both Chair and Chief Executive Officer, the Board appoints an independent director to serve as Lead Independent Director. As Chair, Ms. Bamford fulfills hisher responsibilities in chairing the Board through close interaction with the Lead Independent Director. The Board has structured the role of its Lead Independent Director to strike an appropriate balance between well-focused and independent leadership on the Board. The Lead Independent Director serves as the focal point for independent Directors regarding resolving conflicts with the Chief Executive Officer, or other independent Directors, and coordinating feedback to the Chief Executive Officer on behalf of independent Directors regarding business issues and Board management. The Lead Independent Director and Executive ChairmanChair are expected to foster a cohesive Board that supports and cooperates with the Chief Executive Officer’s ultimate goal of creating stockholder value. In this regard, the Lead Independent Director’s responsibilities include, without limitation:among other duties:
• | Convening and presiding over executive sessions attended only by non-employee Directors; | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Communicating to the Chief Executive Officer the substance of discussions held during those sessions to the extent requested by the participants; | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Serving as a liaison between the | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Consulting with the | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Overseeing the Board’s self-evaluation process; and | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Presiding at meetings of the Board in the event of the |
The Board believes this governance structure and these practices ensure that strong and independent directors will continue to effectively oversee the Company’s management and key issues related to long-term business plans, long-range strategic issues, risks, and integrity.
Board Role in Risk Oversight
General
The Board of Directors overseesis charged with oversight of the Company’s risk management policies and practices with the objective of ensuring appropriate risk management systems are employed throughout the Company to help ensure a successful business at the Company. While the Executive Chairman, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, and otherall members of the Company’s senior leadership team are responsible for the assessment and day-to-day management of risk, the Board of Directors is responsible for assessing the Company’s major risks and ensuring that appropriate risk management and control procedures are in place.
The Company relies on a comprehensive enterprise risk management program designed to aggregate,work across the entire organization to identify, assess, monitor, measure, and manage risk.the Company’s strategic, operational, financial reporting, legal and compliance, cybersecurity, information security, data protection and technology risks. The Company’s enterprise risk management program is designed to enable the Board to establish a mutual understanding with management of the effectiveness of the Company’s risk management practices and capabilities, to review the Company’s risk exposure, and to elevate certain key risks for discussion at the Board level. While the Board has the ultimate oversight responsibility for risk management processes, various committees of the Board composed entirely of independent directors, also have responsibility for certain aspects of risk management. The Board and its committees are kept informed by various reports on risk identification and mitigation provided to them on a regular basis, including reports made at the Board and Committee meetings by management and the Company’s independent auditors. The Board and its committees have direct and independent access to management. By fostering increased communication, the Company’s believes
30 |
23the current Board leadership structure and the Board’s risk oversight practices lead to the identification and implementation of effective risk management strategies.
Key Board Committee Oversight Responsibilities
Audit Committee: The Audit Committee of the Board, acting pursuant to its written charter, serves as the principal agent of the Board in fulfilling the Board’s oversight of risk assessment and management, including with respect to major strategic, operational,strategic; operational; financial reporting,reporting; legal and compliance,compliance; cybersecurity, information security, data protection and technology risks (including cybersecurity), and the impact of COVID-19 on the Company and the Company’s actions in response.risks. The Company’s Vice President, Risk and Compliance (“VP of Risk”), who reports to the Audit Committee, facilitates the enterprise risk management program discussed above, and helps ensure that risk management is integrated into the Company’s strategic and operating planning process. The Vice President,Company’s VP of Risk and Compliance, regularly updates the Audit Committee on the Company’s risk management program throughout the year through discussions of individual risk areas, as well as an annual summary of the enterprise risk management process. The Audit Committee reviews with management the risks presented and the steps management has taken to monitor, mitigate, and control such risks. The Chairperson ofIn addition, periodically, but not less than annually, the Audit Committee thenreceives a report from the Company’s General Counsel and the Company’s Chief Ethics Officer relating to, (i) the implementation and effectiveness of the Company’s legal and ethical compliance program and adherence to the Company’s Code of Conduct and (ii) all significant compliance investigations undertaken in the past year. Furthermore, the Company’s General Counsel oversees risks related to, among other areas, global trade compliance, labor and employment, and disputes and litigation, and provides periodic reports to the full BoardAudit Committee on these topics. Moreover, the risks associatedAudit Committee also regularly meets in executive session without management present with the Company’s operations
The Board is actively engaged in the oversightDirector of Internal Audit and the Company’s information securityindependent registered public accounting firm to discuss areas of concern. In many instances, the discussion of these risks is integrated within the topics on the Board and technology programs (including cybersecurity). committee agendas.
The Company’s Chief Information Officer (“CIO”) leads the Company’s cybersecurity risk assessment and risk management program. The CIO, with over 25 years of experience leading cybersecurity oversight, brings a wealth of expertise and in-depth knowledge instrumental in developing and executing the Company’s cybersecurity program. The Company’s cybersecurity program which is fully integrated into the Company’s overall enterprise risk management programprogram. The Company’s VP of Risk works closely with the CIO and overseen byhis information technology security team to continuously evaluate and address cybersecurity risks in alignment with the Audit Committee. Company’s business objectives and operational needs. This integration ensures that cybersecurity considerations are an integral part of the Company’s decision-making processes at every level.
The Audit Committee reviewsCIO continually assesses industry best practices, frameworks, and receives regular briefings concerningstandards, and leverages them to advance the Company’s cybersecurity program. This ongoing knowledge acquisition is crucial for the effective prevention, detection, mitigation, and remediation of cybersecurity incidents. The Company’s cybersecurity risk management program includes the deployment of tools and data protection practices, including discussions of rapidly evolving cyber securityactivities designed to prevent, detect, and analyze current and emerging cybersecurity threats, cyber security technologies and solutions deployed, major cyber risk areas, policiesplans and proceduresstrategies to address those risks,threats and cyber incidents, from the Company’s Chief Information Officer.incidents. Program highlights include:
• |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| • | Monitoring of all IT assets, resources, and data 24-hours per day, 7-days per week, 365-days per | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
year by security operations center (SOC). | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Performing annual testing of the Company’s incident response plan and cybersecurity posture by a third party. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Incorporating external expertise to manage the SOC, perform penetration tests, cyber-attack simulation exercises, and log management to review anomalies indicating a possible breach. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| • | Maintaining a business continuity program and cyber insurance. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Performing periodic employee simulated phishing campaigns. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | Conducting annual cybersecurity and insider threat training for all employees. |
31 |
The CIO plays a pivotal role in informing the Audit Committee, as well as our Chief Executive Officer and other members of the Company’s senior management team, including the Chief Financial Officer, Chief Operating Officer, and General Counsel, on cybersecurity risks. The CIO provides comprehensive briefings to the Audit Committee on a periodic basis, which the Chief Executive Officer and other members of the senior management team attend. This report includes discussions of rapidly evolving cybersecurity threats, cybersecurity incidents, cybersecurity technologies and solutions deployed, major cybersecurity risk areas, and policies and procedures to address those risks and cybersecurity incidents. The report also includes third-party assessments of the Company’s cybersecurity program, which are conducted regularly. The CIO also informs the Chief Executive Officer and other members of the senior management team on a more informal basis of all aspects related to cybersecurity risks and incidents. This ensures that the highest levels of management are kept abreast of the cybersecurity posture and potential risks facing the Company. Any significant cybersecurity matters, and strategic risk management decisions related thereto, are escalated to the Board of Directors, ensuring that they have comprehensive oversight and can provide guidance on significant cybersecurity issues.
Executive Compensation Committee: The Executive Compensation Committee considers risks in connection with its design of compensation programs and equity compensation plans for the Company’s employees, including the executive officers, includingwhile incorporating features that mitigate risk without diminishing the incentive nature of the compensation. The conclusions of this assessment are set forth in the Compensation Discussion and Analysis under the heading “Risk Consideration in the Overall Compensation Program for 20202023”” on page 4759 of this Proxy Statement.
Finance Committee: The Finance Committee is responsible for assessing risks related to financing matters such as pension plans, capital structure, capital allocation, currency risk and hedging programs, and equity and debt issuances.issuances, as well as to insurance-related risk management programs.
Committee on Directors and Governance: The Committee on Directors and Governance oversees risk related to the Company’s overall governance, including Board and committee composition, Board size and structure, Directordirector recruitment, Directordirector independence, Directordirector compensation, ethical and business conduct, and the Company’s corporate environmental, social and governance (ESG) profiles and ratings.ratings, including reviewing the adequacy of the Company’s strategy, policies, practices, programs, procedures, initiatives and training as they relate to the environment (including climate change and sustainability), and health and safety. The Committee on Directors and Governance receives periodic briefings on the Company’s ESG efforts and enterprise-level EHS Management System to identify and understand specific risks within the ESG and EHS realms so the Board can stay abreast of both emerging and material ESG and EHS risks that could have a material impact on the Company.
Each Chair of a Board committee delivers a report to the Board, no later than the next scheduled board meeting, regarding matters considered at committee meetings that have taken place since the previous board meeting, including any risks associated with the Company’s operations.
Effectiveness of the Company’s Risk Oversight Approach
The Company believes the division of risk management responsibilities among the Board, its committees and senior management is the most effective approach for addressing the risks the Company faces. The Board believes that its leadership structure facilitates itssupports effective risk oversight of risk by combining Board committees and majority independent Board composition with an experienced Executive ChairmanChair and Chief Executive Officer who havehas detailed knowledge of the Company’s business, history, and the complex challenges it faces. The Executive ChairmanChair and Chief Executive Officer’s in-depth understanding of these matters and involvement in the day-to-day management of the Company position thempositions her to promptly identify and raise key risks to the Board and focus the Board’s attention on areas of concern. The independent committee chairs and other Directors also are experienced professionals or executives who serve on the various committees involved in assisting with risk oversight and can and do raise issues for Board consideration and review and are not hesitant to challenge management. The Board believes there is a well-functioning and effective balance between the non-management Directors and the Executive ChairmanChair and Chief Executive Officer that enhances risk oversight.
32 |
24Board Oversight of ESG
The Company believes strong governance and oversight of ESG issues is critical, particularly with respect to the issues that impact the Company’s stakeholders–customers, stockholders, employees, suppliers, and the environment. These ESG elements contribute both to the long-term success of the Company’s business and to the positive impacts the Company can make in society. The Board works closely with the senior management team to oversee ESG at the Company, both directly and through its standing committees dedicated to areas of the program associated with their respective areas of responsibility. Committee oversight responsibilities include:
• | The Committee on Directors and Governance, by delegation of the Board, provides primary oversight over the Company’s ESG program generally, including any disclosure related to public emissions and climate-related data, targets, and goals; | |
• | The Audit Committee oversees the adequacy and performance of the Company’s ethics program, the Company’s cybersecurity and risk management programs, including the establishment and periodic review of any related internal controls and procedures; and | |
• | The Executive Compensation Committee oversees the development, implementation and effectiveness of the Company’s strategies and policies related to human capital management. |
The health and safety of the Company’s employees is a top priority for the Board, and the Board exercises direct and active oversight over the Company’s health and safety initiatives. The Committee on Directors and Governance and the Board receive regular reports from senior management, including the Company’s Sr. Director of EH&S, who reports to the Company’s Vice President, General Counsel, and Corporate Secretary. The Company has implemented procedures and precautions to ensure the continued safety and well-being of employees. The Company is always looking for ways to improve on compliance standards by utilizing continuous improvement discipline to proactively eliminate risks in the workplace.
Board Role in Strategic Oversight
The Board takes an active role in overseeing senior management’s formulation and implementation of its strategic plan. It receives a comprehensive overview of management’s strategic plan for all the Company’s businesses at least annually, receives regular updates from consultants and other experts on the global capital markets and industrial environment, and receives periodic updates from individual businesses at other regularly scheduled Board meetings throughout the year. The Board provides insight and feedback to senior management, and, if necessary, challenges management on the Company’s strategic direction. The Board also monitors and evaluates, with the assistance of the Chief Executive Officer, the Company’s strategic results, and approves all material capital allocation decisions.
The Board and management are committed to optimizing the allocation of capital resources for future growth. Management regularly evaluates the Company’s portfolio of businesses and potential corporate development opportunities with the input and collaboration of the Board. The Board regularly reviews and assesses the value proposition and risks of any proposed acquisition, as well as whether our existing business segments should be expanded, curtailed, disposed of, or diversified. In addition, the Board’s Finance Committee provides oversight and focuses on the Company’s capital structure, including organic and inorganic investment options aligned with the Company’s strategies, share repurchases, dividends, and capital expenditures. Accordingly, acquisitions and divestitures are part of the Company’s ongoing strategy assessment and execution to maximize long-term stockholder value.
Succession Planning
The Board of Directors recognizes that one of its most important responsibilities is to ensure excellence and continuity in the Company’s senior leadership by overseeing the development of executive talent and planning for the effective succession of the Company’s Chief Executive Officer and the other senior members of the Company’s senior leadership team. This responsibility is reflected in the Company’s Corporate Governance Guidelines, which provide for an annual review of CEO succession planning and management development. The Committee on Directors and Governance assists the Board inoversees the succession planning
33 |
process by reviewing and recommending to the full Boardevaluating candidates for successor to the Chief Executive Officer and to assure that senior management has established and maintains a succession planning process for senior executive positions other than the Chief Executive Officer. As part of the succession planning process, the Chief Executive Officer, working with the Board, also reviews and maintains an emergency succession plan for the position of Chief Executive Officer.
In furtherance of the foregoing, the Company’s Chief Executive Officer provides an annuala biennial succession planning report to the Board of Directors, which summarizes the overall composition of the Company’s senior leadership team, including their professional qualifications, tenure, and work experience. The report also identifies internal members of the senior leadership team who are viewed as potential successors to the Chief Executive Officer. Succession planning is also regularly discussed in executive sessions of the Board of Directors. The Company’s directors become familiar with internal potential successors for key leadership positions through various means, including the annuala biennial succession planning report and Board of Directors and committee meetings, and less formal interactions throughout the course of the year.
As part of the Company’s succession planning, the Company transitioned to a new generation of leadership during the past twelve months. On January 1, 2021, Ms. Lynn M. Bamford became the Company’s President and Chief Executive Officer and a member of the Board, succeeding Mr. David C. Adams, who resigned after seven years as Chief Executive Officer. In connection with this CEO transition, Mr. Adams will continue as the Company’s Executive Chairman and will remain on the Board until his retirement in May 2022. In addition, in May 2020, Mr. K. Christopher Farkas became the Company’s Chief Financial Officer, upon the resignation of Mr. Glenn E. Tynan from that position. At the same time, Mr. Gary Ogilby was promoted to the role of Vice President and Corporate Controller, succeeding Mr. Farkas upon his promotion to Chief Financial Officer. Furthermore, on January 11, 2021, Mr. Robert Freda became the Company’s Vice President and Treasurer, upon the retirement of Mr. Harry Jakubowitz. Moreover, Mr. Kevin Rayment will be promoted to the role of Vice President and Chief Operating Officer commencing with the retirement of Mr. Thomas P. Quinly in April 2021. All of these appointments were internal promotions and it exemplifies the Board’s ongoing commitment to recruiting, cultivating, and developing executive talent to meet the Company’s organizational and strategic needs.
Additionally, the Board of Directors, with support and recommendations from the Committee on Directors and Governance, oversees the succession of its members. To this end, at least once a year, in connection with the annual director nomination and re-nomination process, the Committee on Directors and Governance evaluates each director’s performance, relative strengths and weaknesses, and future plans, including any personal retirement objectives and the potential applicability of the Company’s mandatory retirement policy for directors (which is set forth in the Company’s Corporate Governance Guidelines). As part of that evaluation, the Committee on Directors and Governance also identifies areas of overall strength and weakness with respect to its composition and considers whether the Board of Directors as a whole possesses core competencies in the areas of accounting and finance, management experience with mergers and acquisitions, risk management, industry knowledge, knowledge of technology and cyber-security,cybersecurity, marketing, digital marketing and social media, international markets, strategic vision, compensation, and corporate governance,ESG, among others.
Director Onboarding and Education
All new Directors participate in the Company’s director onboarding program. The onboarding process includes in-person or virtual meetings with senior leaders to familiarize new directors with the
25
Company’s strategic vision, values, and culture; operational and financial reporting structure; and legal, compliance, and governance framework. Our goal is to assist our new Directors in understanding the Company and developing the skills and knowledge that they need to serve the interests of the Company’s stockholders.
It is important for directors to stay current and informed on developments in corporate governance best practices to effectively discharge their duties, as well as be exposed to information regarding conditions in the end markets where the Company operates to increase the Directors understanding of the Company’s risks and opportunities. The Company provides its Directors updates from both internal and outside industry experts on corporate governance trends and developments as well as in the Company’s end markets and other issues of importance to the Company at regularly scheduled board and committee meetings. The Board also encourages all Directors to participate in continuing director education programs, either individually or together with other Committee members, to help them maintain and enhance their skills and knowledge in carrying out their ongoing responsibilities as directors of a public company. The Directors are reimbursed for their expenses for such programs.
Stockholder Recommendations and Nominations for Directors
Stockholder Recommendations.
The Committee on Directors and Governance will consider stockholder recommendationsnominations for Director nominees. A stockholder desiring the committee to consider his or her Director recommendationnominations should deliver a written submission in accordance with the Company’s By-laws to the Committee on Directors and Governance in care of the Corporate Secretary, Curtiss-Wright Corporation, 130 Harbour Place Drive, Suite 300, Davidson, North Carolina 28036. Such submission must include:
(1) | the name and address of such stockholder, |
34 |
(2) | the name of such nominee, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3) | the nominee’s written consent to serve if elected, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(4) | documentation demonstrating that the nominating stockholder is indeed a stockholder of the Company, including the number of shares of stock owned, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(5) | a representation (i) that the stockholder is a holder of record of the stock of the Company entitled to vote at such meeting and whether he or she intends to appear in person or by proxy at the meeting, and (ii) whether the stockholder intends or is part of a group that intends to deliver a proxy statement to the Company’s stockholders respecting such nominee or otherwise solicit proxies respecting such nominee, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(6) | a description of any derivative instruments the stockholder owns for which the Company’s shares are the underlying security or any other direct or indirect opportunity the stockholder has to profit from any increase or decrease in the value of the Company’s stock, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(7) | a description of the extent to which the stockholder has entered into any transaction or series of transactions, including hedging, short selling, borrowing shares, or lending shares, with the effect or intent to mitigate loss to or manage or share risk or benefit of changes in the value or price of share of stock of the Company for, or to increase or decrease the voting power or economic interest of, such stockholder with respect to any shares of stock of the Company, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(8) | a description of any proxy, contract, arrangement, understanding, or relationship under which the stockholder has a right to vote any of the shares of stock of the Company or influence the voting over any such shares, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(9) | a description of any rights to dividends on the shares of stock of the Company the stockholder has that are separated or separable from the underlying shares of stock of the Company, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(10) | a description of any performance-related fees (other than asset-based fee) the stockholder is entitled to based on any increase or decrease in the value of the shares of stock of the Company or related derivative instruments, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(11) | to the extent known, the name and address of any other stockholder(s) supporting the nomination on the date of the stockholder’s submission of the nomination to the Committee on Directors and Governance, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(12) | any information relating to the nominee and his or her affiliates that would be required to be disclosed in a proxy solicitation for the election of Directors of the Company pursuant to Regulation 14A under the Securities Exchange Act of 1934, and | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(13) | a description of all direct and indirect compensation, and other material monetary agreements, arrangements, and understandings during the past three years, and any other material relationships between such nominating stockholder or beneficial owner, if any, on the one hand, and the nominee and his or her respective affiliates or associates, or others acting in concert therewith, on the other hand. |
26
In addition, such submission must be accompanied by a written questionnaire with respect to the background and qualification of the nominee and the background of any other person or entity on whose behalf the nomination is being made. Further, the nominee must also provide a written representation and agreement that such nominee (i) is not and will not become party to (x) any agreement, arrangement, or understanding as to how such prospective nominee will act or vote on any issue or question that has not been disclosed to the Company, or (y) any agreement, arrangement, or understanding as to how such prospective nominee will act or vote on any issue or question that could limit or interfere with such nominee’s ability to comply with such nominee’s fiduciary duties, (ii) is not and will not become party to any agreement, arrangement, or understanding with respect to any direct or indirect compensation, reimbursement, or indemnification in connection with service or action as a director, that has not been disclosed to the Company, and (iii) in such person’s individual capacity and on behalf of any beneficial owner on whose behalf the nomination is being made, would be in compliance with all applicable corporate governance, conflict of interest, confidentiality, and stock
35 |
ownership and trading policies and guidelines of the Company. The Committee may require additional information from the nominee to perform its evaluation.
The
Board Membership Criteria and Selection Process for Director Nominees
In addition to stockholder nominations for Directors, the Committee on Directors and Governance also considers candidates for Board membership as recommended by Directors or executive management. The Committee on Directors and Governance uses the same criteria to evaluate all candidates for Board membership, whether recommended by Directors, executive management, or stockholders. As it deems necessary, the Committee on Directors and Governance may engage consultants or third-party search firms to assist in identifying and evaluating potential nominees. In its assessment of each potential nominee, the Committee on Directors and Governance takes into account the skills and characteristics that the Board seeks in its members as well as consideration of the diversity of the Board as a whole. This review includes an assessment of, among other things, a candidate’s knowledge, education, experience, cultural background, including ethnicity, gender and age, and skills in areas critical to understanding the Company and its business, with a commitment to enhancing stockholder value. The Committee on Directors and Governance seeks candidates with the highest professional and personal ethics and values and who will operate in accordance with the Company’s Code of Conduct.Conduct and corporate governance guidelines. The Committee on Directors and Governance also assesses a candidate’s ability to make independent analytical inquiries, and willingness to devote adequate time to Board duties. Prospective candidates should be committed to representing the long-term interests of the Company’s stockholders. Moreover, a potential candidate must exhibit an inquisitive and objective perspective, an ability to think strategically, an ability to identify practical problems, and an ability to assess alternative courses of action that contribute to the long-term success of the business. Director nominees should possess at least the following experience, attributes, and characteristics:
Experience (in one or more of the following):
The Committee on Directors and Governance annually evaluates the performance of the Board, each of the committees, and each of the members of the Board. It also reviews the size of the Board and whether it would be beneficial to add additional members and/or any new skills or expertise, Once an individual has been identified by the Committee on Directors and Governance as a potential candidate, the Committee, as an initial matter, may collect and review publicly available information regarding the individual to assess whether the individual should be considered further. Generally, if the individual expresses a willingness to be considered and to serve on the Board, and the Committee believes that the individual has the potential to be a good candidate, the Committee would seek to gather information from or about the individual, review the individual’s accomplishments and qualifications in light of any other candidates that the Committee might be considering, and, as
appropriate, conduct one or more interviews with the individual. In certain instances, Committee members may contact one or more references provided by the candidate or may contact other members of the business community or other individuals that may have greater first-hand knowledge of the candidate’s accomplishments. The Committee’s evaluation process does not vary based on whether Board Diversity Although the Committee on Directors and Governance does not have a formal written policy regarding considering diversity in identifying nominees for directors, it does believe that maintaining a diverse membership with varying backgrounds, skills, expertise, and other differentiating characteristics promotes inclusiveness, enhances the Board’s deliberations, and enables the Board to better represent all the Company’s constituents. Consequently, in its assessment of each potential nominee, the Committee on Directors and Governance considers the skills and characteristics that the Board seeks in its members as well as consideration of the diversity of the Board as a whole. This review includes an assessment of, among other things, a candidate’s knowledge, education, experience, cultural background, including ethnicity, national origin, gender, sexual orientation, and age, and skills in areas critical to understanding the Company and its business, with a commitment to enhancing stockholder value. Diversity considerations for a director nominee may vary at any time according to the particular areas of expertise being sought as a complement to the existing Board composition. The Company believes its nominees for directors at this Annual Meeting appropriately reflect a diversity of experience and skills and of professional, gender, ethnic and personal backgrounds. The Board is committed to maintaining these different facets of diversity among its members. Board Tenure The Board strives to maintain an appropriate balance of tenure and refreshment among directors. The Board believes there are significant benefits from the valuable experience and familiarity with the Company and its people and processes that longer-tenured directors bring, as well as significant benefits from the fresh perspectives and ideas that new directors bring. The average tenure of our director nominees is 6 years. Under the Board’s corporate governance guidelines, Directors are expected to retire from the Board effective at the Annual Meeting after reaching the age of 75. We believe the Board strikes the right balance of longer serving and newer directors. Stockholder Engagement The Company approaches stockholder engagement as an integrated, year-round process involving senior management and the investor relations team. The Company welcomes the opportunity to openly engage The Company engages with stockholders throughout the year to:
Convey feedback on critical conversations and issues back to senior management and the Board to enhance future disclosure and decision-making. Throughout the year, the Company meets with research analysts and institutional investors to inform and share the Company’s perspective on its financial and operational performance through its participation in investor conferences, non-conference roadshows, investor days and other formal events where the Company conducts group and one-on-one meetings. The Company also engages with governance representatives of its major stockholders, through conference calls that occur during and outside of the proxy season.
During The comments, questions and suggestions offered by the Company’s investors were shared with, and discussed by, the full Board, and their perspectives will inform the Board’s decision-making in
The following report of the Audit Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this report by reference therein. Audit Committee Report Management is responsible for the financial reporting process, including its system of internal controls, and for the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. Our independent accountants are responsible for auditing those financial statements and the Company’s internal controls over financial reporting. The Audit Committee is responsible for monitoring and reviewing these processes. The Audit Committee does not have the duty or responsibility to conduct auditing or accounting reviews or procedures. None of the members of the Audit Committee may be employees of the Company. Additionally, the Audit Committee members may not represent themselves to be accountants or auditors for the Company, or to serve as accountants or auditors by profession or experts in the fields of accounting or auditing for the Company. Therefore, the Audit Committee has relied, without independent verification, on management’s representation that the financial statements have been prepared with integrity and objectivity and in conformity with generally accepted accounting principles in the United States of America and on the representations of the independent accountants included in their report on the Company’s financial statements. The oversight performed by the Audit Committee does not provide it with an independent basis to determine that management has maintained appropriate accounting and financial reporting principles, or policies or appropriate internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the discussions that the Audit Committee has with management and the independent accountants do not assure that the financial statements are presented in accordance with generally accepted accounting principles, that the audit of the financial statements has been carried out in accordance with generally accepted auditing standards, or that our independent accountants are in fact “independent.” As more fully described in its charter, the Audit Committee is responsible for, among other items, overseeing the integrity of the Company’s financial statements and the financial reporting process, the systems of internal accounting and financial controls, the qualifications and performance of the internal
audit function and internal auditors, and the annual independent audit of the Company’s financial statements by the Company’s independent registered public accounting firm, Deloitte & Touche LLP. As part of fulfilling its responsibilities, the Audit Committee reviewed and discussed with management and Deloitte & Touche LLP the audited consolidated financial statements for fiscal year
a discussion of the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the financial statements, as well as the Company’s earnings releases and quarterly and annual reports on Form 10-Q and Form 10-K prior to filing with the SEC. In addition, the Audit Committee reviewed with management, Deloitte & Touche LLP, and the Company’s Director of Internal Audit, the overall audit scope and plans, the results of internal and external audits, evaluations by management and Deloitte & Touche LLP of the Company’s internal controls over financial reporting and the quality of the Company’s financial reporting. The Audit Committee also discussed with Deloitte & Touche LLP the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC. The Audit Committee has also discussed and considered the independence of Deloitte & Touche LLP with representatives of Deloitte & Touche LLP, reviewing as necessary all relationships and services (including non-audit services) that might bear on the objectivity of Deloitte & Touche LLP, and received the written disclosures and the letter required under Rule 3526 of the PCAOB (Communications with Audit Committees Concerning Independence) from Deloitte & Touche LLP. Based on the forgoing, the Audit Committee concluded that Deloitte & Touche LLP is independent from the Company and its management. The Audit Committee schedules separate private sessions, during its regularly scheduled meetings, with Deloitte & Touche LLP and the Company’s Director of Internal Audit, at which candid discussions regarding financial management, accounting, auditing and internal control issues takes place. Deloitte & Touche LLP is also encouraged to discuss any other matters they desire with the Audit Committee, the Director of Internal Audit, and/or the full Board of Directors. The opinions of Deloitte & Touche LLP are filed separately in the Based upon the Audit Committee’s review and discussions referred to above, the Audit Committee
COMPENSATION DISCUSSION AND ANALYSIS This Compensation Discussion and Analysis (“CD&A”) details the Executive Compensation Committee’s (“Committee”) decisions regarding the compensation programs and practices as they relate to the Company’s Named Executive Officers (“NEOs”).
The Company strives to attain top quartile performance compared with its peer group (as later defined in this CD&A), by concentrating on:
The Company also maintains a disciplined and balanced capital allocation strategy–all part of the Company’s effort to improve competitiveness over the long term and generate stronger returns for stockholders.
Despite the challenges relating primarily to continuing supply chain delivery disruptions, workforce availability issues, and inflationary pressures, the Company performed very well in fiscal 2023, with strong increases in sales, operating income, earnings per share, and free cash flow. As a result, Company performance was at maximum relative to target against its financial performance metrics under the annual incentive compensation plan. As a result, bonus payments for the NEOs under the annual incentive program were well above target level pay. In addition, under the long-term incentive plan, the Company was at maximum relative to target against its financial performance metrics under the long-term incentive compensation plan over the past three-year performance period (2021-2023). As a result, cash-based performance units payouts for the 2021-2023 performance period were at maximum of target level pay and TSR was at the 87th percentile of the In
The Company’s financial performance includes adjustments referenced in the Company’s fourth quarter 2023 earnings release furnished to the SEC on February 15, 2024. The Company’s financial performance above excludes the performance of any acquisitions consummated during the performance
The following charts illustrate how the Company compares against the
As discussed in the section titled “2023 Company Financial Performance” on page 40 of this CD&A, the Committee believes incentive awards earned by the NEOs for fiscal
Compensation Practices and Policies The Committee frequently reviews the Company’s executive compensation program to ensure it supports the Company’s compensation philosophy and objectives and continues to drive corporate performance to achieve the Company’s strategic plan. The Committee continues to implement and maintain best practices for executive compensation. Listed below are some of the best practices the
Company follows for all participants of the incentive plans and the practices that the Company does not include in its program:
Consideration of Say on Pay Results The Company provides its stockholders an annual advisory vote to approve its executive compensation program under Section 14A of the Exchange Act. At the Stockholder input is important to the Committee. The Company regularly solicits input from its major stockholders on the Company’s executive compensation programs. The Company received
overall positive feedback regarding the Company’s performance, core compensation structure, and elements of its executive compensation program. The Committee evaluated these results, considered stockholder feedback received by the Company, and took into account many other factors in evaluating the Company’s executive compensation programs as discussed in this CD&A. The Committee also assessed the interaction of our compensation programs with our business objectives, input from its independent compensation consultant, Frederic W. Cook & Co., Inc. (FW Cook), and review of peer data, each of which is evaluated in the context of the Committee’s fiduciary duty to act as the directors determine to be in the
best interests of the Company. While each of these factors bore on the Committee’s decisions regarding our NEOs’ compensation, the Committee did not make any material changes to our Overview of the Compensation Philosophy The Company’s overall compensation philosophy for all participants and objectives will support and enable:
Compensation mix To reinforce the Company’s pay for performance philosophy,
Performance-based compensation
The acronyms PSUs, Competitive market data and peer group data The Committee analyzed competitive market data from two sources:
1. Peer group; and 2. Survey data The Committee utilizes both peer group and aerospace and defense industry survey data when evaluating NEO compensation levels. The peer group data is representative of competitors with similar product lines, markets / industries and relative revenue size. Peer group
While the Committee reviews both peer group data and nationally recognized survey data from third party sources, the Committee primarily relies on peer group data for the CEO and CFO, while placing more focus on nationally recognized executive survey data from third party sources for the other NEOs. The Committee believes that due to the smaller number of peer matches and more robust sample size of the surveys, the latter provides more robust and reliable compensation data for roles other than the CEO and CFO. Roles in determining Summarized in the table below are roles and responsibilities for executive compensation:
During
The table below summarizes each of the Company’s
Base Salary Base salary is intended to compensate The Committee determines and approves NEO salaries annually that reflect the value of the position measured by competitive market data, the NEOs’ individual performance, and the individual’s longer-term intrinsic value to the Company. For
Annual Incentive Compensation For The Company believes that an important portion of the overall cash compensation for all participants in the
Similar to the process described above to determine annual base salaries, the Committee annually establishes a target bonus opportunity for each NEO. For
For the
(a) Adjusted metric. ICP Formula Payout = (30% of Target x OI Performance Rating) + (20% of Target x + (20% of Target x Individual Rating) Any adjustments are reviewed by FW Cook, approved by the Committee, and audited by our
Goal Setting Process Annual ICP financial performance goals are developed through a rigorous goal setting process to test the validity of the Company’s performance objectives. In reviewing and setting performance targets, the Committee considers the Company’s five-year strategic plan, annual budget, the Company’s compensation structure, historical and forecasted performance for the Company and its peer group, analyst estimates of prospective performance of the Company and its peer group, The goals set by the Committee are designed to provide correlating pay for performance while targeting to the 50th percentile. For pay above the 50th percentile, there must be a corresponding level of performance.
No incentive is paid if performance falls below threshold, and payouts are capped and may not exceed 200% of target. For
For
For
Individual objectives are generally measurable and weighted based on their relative importance to the goals of the business unit and the overall success of the Company. Individual objectives can be quantitative or more subjective as long as they support operational success and reflect management’s strategy. The Committee reviews each NEO’s individual performance. The CEO provides a rating between 1 (one) and 5 (five) for each of the NEOs’ objectives other than Individual specific goals for NEOs in 2023 related to investor outreach, strategic sales growth (organic and inorganic), talent management and acquisition, contract risk management, implementing and benchmarking ESG, climate, and new executive compensation disclosure, and implementing financial management systems.
In order to assess the NEOs’ individual performance, the Committee is generally provided with detailed supporting documentation. In awarding a rating to each NEO, the Committee analyzes this
supporting justification, and takes into account the Company’s overall performance and the assessment of the Chief Executive Officer.
The following table details the
In no event may ICP awards for participants be increased on a discretionary basis; however, the Committee does have the discretion to decrease the amount of any award paid to any participant under the ICP. For
Key Changes to the Annual Incentive Compensation Design for There were no changes made to the ICP metrics and weightings for Long-Term Incentive Program The Company’s long-term incentive plan (“LTIP”) is designed to ensure its executive officers and key management employees are focused on longer-term stockholder value creation through incentive compensation that rewards for longer-term (i.e., three years or more) performance.
In determining the
Listed below are the
If the NEOs drive Company performance that achieves target levels, payouts will result in values that approximate market median LTIP payments.
The Committee believes the award mix summarized in the table below provides the proper amount of leverage in the LTIP program. The LTIP components will balance the multiple interests of 1) significant pay at risk, 2) stockholder interests, 3) retention, and 4) internal and external performance goals. The three components chosen will each accomplish a different “mission” in terms of incenting NEO performance. LTIP equity awards are typically made in March, during an open trading window after the Company’s February release of year-end earnings. Awards are neither timed to relate to the price of our stock nor to correspond with the release of material non-public information.
Performance Share Units The target number of PSUs granted is calculated by multiplying the total dollar value of the LTIP grant by the percentage of LTIP grant allocated to PSUs
The payout is determined based on the table below in relation to peer performance. The Company has capped payout at 100% if absolute TSR is negative.
(1) Linear interpolation will apply for performance between disclosed payout levels.
Cash-Based Performance Units The target number of The number of units vesting can range from 0% to 200% of target. Performance targets for each goal are established at the beginning of the performance period. Restricted Stock Units The number of RSUs granted is calculated
Performance Share Units In February Cash-Based Performance Units In February
For the
The NEO awards are listed in the Summary Compensation Table in this Proxy Statement under the heading “Non-Equity Incentive Plan Compensation” and detailed below. The following table details results for the Company’s cash-based performance unit payouts granted in
Key Changes to the 2024 LTIP Design and Grants There were no changes made to the LTIP award mix, metrics, and weightings for 2024. LTIP grants consisted of equity-based performance share units (“PSUs”), cash-based performance units (“PUPs”), and time-based restricted stock units (“RSUs”). Employee Stock Purchase Plan The Company’s NEOs, along with substantially all other full time Company employees, are eligible to participate in the Curtiss-Wright Corporation Employee Stock Purchase Plan (“ESPP”). The purpose of the ESPP is to encourage employees of the Company and its subsidiaries to increase their ownership in During Executive Deferred Compensation Plan The NEOs are also eligible to participate in the Company’s non-qualified executive deferred compensation plan that allows participants to defer compensation in excess of certain statutory limits that apply to qualified retirement plans. Each participant may defer up to 25% of their base salary; 50% of their annual performance bonus; and 50% of the cash portion of their long-term cash award. The rate of interest is determined each year according to the average rate on 30-year Treasury bonds for November of the previous calendar year, plus 2.0%. Thus, the rate fluctuates annually. The average 30-year Treasury bond rate for November
compensation plan.
Pension Plans The NEOs (except Mr. Rayment1) also participate in the Curtiss-Wright Corporation Retirement Plan (the “Retirement Plan”) and the Curtiss-Wright Corporation Retirement Benefits Restoration Plan (the “Restoration Plan”). This is consistent with the Company’s philosophy that compensation should promote the long-term retention and financial health of its employees and be competitive with industry peers. The Company’s retirement plans integrate other components of the Company’s executive compensation program by generally including base salary and cash incentive compensation in determining retirement plan benefits. The Retirement Plan is a tax qualified, defined benefit plan made up of two separate benefits: (1) a traditional, final average pay (FAP) formula component (this benefit was closed to new entrants as of February 1, 2010 and has a On September 1, 1994, the Company amended and restated the Retirement Plan, and any benefits accrued as of August 31, 1994 were transferred into the amended Retirement Plan. The Retirement Plan, as amended, provides for an annual benefit at age 65 of 1.5% times the As of January 1, 2015, no NEO had accrued any pension benefits prior to the plan merger in 1994: Ms. Bamford, Mr. Since the Company provides a traditional final average pay benefit under the Retirement Plan to Ms. Bamford and Messrs. Farkas, Ferdenzi, and Watts, the Company did not offer any Company-source contributions to these NEO’s under the Company’s 401(k) savings Plan. Because Mr. Rayment transferred to the United States after the FAP component of the Retirement Plan was closed to new entrants, he is eligible for employer matching contributions of 50% on 8% contributed to the Curtiss-Wright Savings and Investment Plan (the “S&I Plan”). The S&I Plan does not match contributions above 8%. In addition to the matching contribution in the S&I Plan, the S&I Plan also provides a 3% non-elective contribution to all non-union, domestic employees hired on or after February 1, 2010 that do not participate in the Retirement Plan. The Company maintains an unfunded, non-qualified defined contribution Restoration Plan under which participants in the S&I Plan whose compensation or benefits exceed the limits imposed by I.R.C. Sections 401(a) (17) and 415 will receive a supplemental retirement benefit that restores the 3% non-elective contribution amount that would have been payable under the S&I Plan except for the application of such limits. Since the Restoration Plan benefits are not funded, in the event of a
PNC Bank, N.A., dated January 30, 1998, which provides for the payment of the Company’s obligation under the Restoration Plan.
NEO’s can elect to defer up to 75% of their own annual cash compensation per year on a tax-deferred basis subject to the IRS Elective Deferral limit within the Company’s 401(k) savings Plan. For Executive Perquisites In addition to the standard benefit plans offered to all employees, the NEOs are eligible for a
Policies concerning equity-based and other long-term incentive compensation Equity Ownership and Other Requirements for Senior Executives To further align the linkage between the interests of the NEOs and those of its stockholders, the Company requires the CEO and all other NEOs to own Company stock denominated as a multiple of their annual salaries as follows: five times annual salary for the CEO, All share-based long-term incentive plan grants, including any vested stock options (post-2005 grants), are subject to the Guidelines, and 50% of the net proceeds of a Clawback
The Company’s general employee incentive compensation recoupment, or “clawback” policy provides that in the event the amount of any incentive compensation award is based on materially inaccurate financial statements or any other materially inaccurate performance metric criteria, or if a participant is one of the individuals subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley Act of 2002 and has committed an offense subject to forfeiture under such statute, the participant must reimburse the Company that portion of the incentive compensation award that was based on the inaccurate data or as provided for in such statute. In September 2023, the Committee adopted a separate executive incentive compensation clawback policy to comply with the requirements of the Dodd-Frank Walls Street Reform and Consumer Protection Act of 2010, as implemented by New York Stock Exchange listing standards and the SEC’s rules and regulation, which applies to current and certain former Section 16 executive officers (the “Dodd-Frank Clawback Policy”). The Dodd-Frank Clawback Policy requires the Company to recover certain cash or equity-based incentive compensation payments or awards made or granted to such executive officers in the event the Company is required to prepare an accounting restatement due to the Company’s material noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period (an “Accounting Restatement”). The Dodd-Frank Clawback Policy covers cash or equity-based compensation that is granted, earned, or vested based wholly or in part upon the attainment of a Company financial reporting measure (including stock price or total shareholder return). Recovery under the Dodd-Frank Clawback Policy applies to incentive compensation subject to the policy that is
received (i) on or after December 1, 2023, (ii) by a person after such individual became an executive officer, and (iii) during the three completed fiscal years immediately preceding the date on which the Company is required to prepare the Accounting Restatement. The incentive compensation to be recovered is the amount in excess of what would have been paid based on the restated results. Recovery will be required on a “no fault” basis, without regard to whether any misconduct occurred and without regard to whether an executive officer was responsible for the erroneous financial statements. Furthermore, under the Dodd-Frank Clawback Policy, the Company is prohibited from indemnifying any executive officer or former executive officer against the loss of erroneously awarded incentive-based compensation. During the third quarter of 2023, the Company identified an error related to a single long-term contract within a subsidiary of its Naval & Power segment. The error primarily impacted 2020 and 2021, whereby certain events occurring during the pandemic, including constructive changes to the contract as well as labor inefficiencies and hiring delays due to a facility relocation, were not reflected in the contract’s estimated costs of completion. In accordance with Staff Accounting Bulletin (“SAB”) Nos. 99 and 108, the Company evaluated this error and, based on an analysis of quantitative and qualitative factors, determined that it was not material to any one of the prior reporting periods affected and, therefore, amendment of previously filed reports with the Securities and Exchange Commission was not required. However, if the adjustment to correct the cumulative effect of the aforementioned error had been recorded in the three and nine months ended September 30, 2023, the impact would have been qualitatively material to the Condensed Consolidated Statements of Earnings of the Company for those respective periods. Therefore, in accordance with SAB 108, the Company revised the applicable prior period financial statements included within its quarterly report on Form 10-Q for the third quarter ended September 30, 2023, as summarized below. The net impact of the error resulted in an overstatement of previously reported total net sales and net earnings of approximately $5 million and $4 million, respectively, for the year ended December 31, 2021, and an overstatement of previously reported total net sales and net earnings of approximately $8 million and $7 million, respectively, for the year ended December 31, 2020. The impact of the error on previously reported total net sales and net earnings was inconsequential for the year ended December 31, 2022. The Company revised its consolidated financial statements as of December 31, 2022 and for the year ended December 31, 2021 in its Form 10-K for the year ended December 31, 2023 filed with the SEC on February 20, 2024. The Committee, the Company’s outside legal counsel, and FW Cook performed an analysis of the impact that the immaterial restatement discussed immediately above (the “Immaterial Restatement”) had on the Company’s past and future payouts under its incentive compensation plans, and whether recovery of such incentive compensation payouts is required under its Dodd-Frank Clawback Policy. Because the Dodd-Frank Clawback Policy only applied to incentive compensation payments received after December 1, 2023, any incentive compensation received prior to such date would not be subject to recoupment under the policy. Accordingly, only annual and long-term incentive compensation received in early 2024 under the Company’s ICP and LTIP for financial performance of the Company against pre-established financial performance measures for the 2023 performance period (ICP) and 2021 – 2023 performance period (LTIP), would be subject to the policy. As noted above, the Committee determined that since the Immaterial Restatement did not impact the 2023 performance period (only impacting prior year periods 2020 through 2022), the receipt of annual incentive compensation under the ICP in early 2024 was not required to be recovered under the Dodd-Frank Clawback Policy. With respect to the receipt of LTIP, the payment of cash-based performance units (PUPs) in early 2024 was based on Company performance against pre-established financial performance measures for the 2021 – 2023 performance period. Based on Company financial performance resulting from the Immaterial Restatement against its performance targets during such performance period, it was determined that Company performance would have resulted in a maximum payout against target with or without the Immaterial Restatement. Therefore, because payment of PUPs was at maximum with giving effect to the Immaterial Restatement, no excess incentive compensation was received by the Section 16 executive officers based on the Immaterial Restatement, and therefore, no recovery was required under the Dodd-Frank Clawback Policy.
The receipt of performance share units (PSUs) under the LTIP in early 2024 was based on Company total shareholder return (TSR) relative to its peer group for the 2021 – 2023 performance period. The Company performed an analysis assessing the impact of the Immaterial Restatement on its TSR and the payouts associated with its TSR. After reviewing the relatively minor financial impacts to 2021 and 2022 performance the Committee reasonably estimated that the Immaterial Restatement was immaterial to the overall financial results of the Company during this period, and reasonably concluded that the restated financials resulting from the Immaterial Restatement would not have impacted the Company’s TSR and PSU payouts. Additionally, the Committee, after advice from the Company’s outside legal counsel and FW Cook, determined that the payouts would have been 200% of target regardless due to the high levels of Company financial performance even as restated. Therefore, because payment of PSUs was 200% of target without giving effect to the Immaterial Restatement, no excess PSUs were received by the Section 16 executive officers based on the Immaterial Restatement, and therefore, no recovery was required under the Dodd-Frank Clawback Policy. Finally, a recovery analysis was also performed under the Company’s general employee incentive compensation recoupment policy discussed above, which has a one-year look back period. Because the general policy only mandates a clawback in the event of a full restatement of financials and the overall Company financial performance was nominally impacted for the 2022 performance period under the ICP and 2020 – 2022 performance period under the LTIP, the Committee determined that no excess incentive compensation was received by the Section 16 executive officers in early 2023 based on the Immaterial Restatement and therefore no recovery was required under the Company’s general employee incentive compensation recoupment policy. Prohibition of Insider Trading, Hedging, and Pledging The Company The Company’s Code of Conduct prohibits all employees (including the NEOs and other officers) from purchasing, selling or otherwise utilizing financial instruments, including but not limited to, prepaid variable forward contracts, instruments for the short sale or purchase or sale of call or put options, equity swaps, collars, or units of exchangeable funds, that are designed to or that may reasonably be expected to have the effect of hedging or offsetting a change in the market price of the Company’s equity securities. Additionally, the Company’s 2014 Omnibus Incentive Plan prohibits members of the Board of Directors and all employees (including the NEOs and other officers) from engaging in the following transactions with respect to Company equity securities from awards under the plan:
Other Policies Use of Tax Gross-up The Company
Tax Deductibility Prior to the Tax Cuts and Jobs Act, Section 162(m) of the Internal Revenue Code generally disallowed a tax deduction to public corporations for compensation over $1,000,000 paid for any fiscal year to the Company’s CEO and up to three other executive officers other than the CFO. However, certain performance-based compensation was exempt from the deduction limit if specific requirements were met. The Committee structured awards to executive officers under the Company’s ICP and equity awards program to qualify for this exemption. However, the 162(m) exception to the deduction limit for performance-based compensation has been repealed, effective for taxable years beginning after December 31, 2017, such that compensation paid to our covered executive officers, including the CFO, in excess of $1,000,000 will not be deductible. Qualifying compensation that the Company pays pursuant to a binding contract that was in effect on November 2, 2017 and is not materially modified after that date will continue to be exempt from the deduction limit under a grandfathering rule. While the Company will continue to monitor its compensation programs in light of Section 162(m), as amended, the Committee considers it important to retain the flexibility to design compensation programs that are in the best long-term interests of the Company and its stockholders. As a result, the Committee will continue to take into account the tax and accounting implications (including with respect to the expected lack of deductibility under the revised Section 162(m)) when making compensation decisions, but reserves its right to make compensation decisions based on other factors as well if the Committee determines it is in its best interests to do so. Accordingly, the Company may pay compensation at levels that are not deductible under Section 162(m). The following report of the Executive Compensation Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this report by reference therein. Executive Compensation Committee Report The Executive Compensation Committee has reviewed and discussed this CD&A (included in this Proxy Statement) with Management. Based upon the Executive Compensation Committee’s review and discussions referred to above, the Executive Compensation Committee recommended that the Board of Directors include this CD&A in the Company’s Proxy Statement for the year ended December 31,
Risk Consideration in the Overall Compensation Program for In
undue risk-taking by employees, including a number of features of the programs that are designed to mitigate risk, including:
For the foregoing reasons, the Committee has concluded that the Company’s compensation policies and practices do not encourage excessive and unnecessary risk-taking, and that the level of risk is appropriate for the best interests of stockholders. Post-Employment Agreements Severance Agreements The Company has At-will severance agreements with Ms. Bamford and Messrs.
Change-in-Control Agreements The Company has Change-in-Control severance protection agreements with Ms. Bamford and Messrs. All agreements have a double trigger, i.e., severance may be paid in the event that (1) there is a change-in-control of the Company, as that term is defined in the agreements, and (2) the covered
executive’s employment is formally or constructively terminated by the Company in the case of Ms. Bamford, within twenty-four months following the change-in-control, and in the case of the other NEOs, within twelve months following the change-in-control. Accordingly, if the Company terminates the employment without “cause” of
The following table sets forth information concerning the total compensation of the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, and the other NEOs of the Company who had the highest aggregate total compensation for the Company’s fiscal year ended December 31, For Summary Compensation Table
The Company’s executive officers are not employed through formal employment agreements. It is the philosophy of the Committee to promote a competitive at-will employment environment, which would be impaired by lengthy employment arrangements. The Committee provides proper long-term compensation incentives with competitive salaries and bonuses to ensure that senior management remains actively and productively employed with the Company. The Company believes perquisites for executive officers should be limited in scope and value and aligned with peer group practices as described earlier. As a result, the Company has historically given nominal perquisites. The below table generally illustrates the perquisites the Company provides to its NEOs. The Company also maintains a policy concerning executive automobiles under which certain officers of the Company are eligible to use Company leased automobiles or receive an equivalent automobile allowance. The NEOs participate in this program. The Company maintains the service and insurance on Company leased automobiles. In addition to the Company automobile policy, the Company also provides all executive officers with financial planning and tax preparation services through The Ayco Company, LP and Ernst & Young Americas LLC. Not all executive officers utilize these services on an annual basis. Finally, all executive officers and their spouses are provided annual physicals through the Mayo Clinic at any one of the clinic’s three locations. Perquisites and Benefits
The Company’s executive officers are entitled to receive medical benefits, life and disability insurance benefits, and to participate in the Company’s Savings and Investment Plan, Defined Benefit Plan, Employee Stock Purchase Plan, flexible spending accounts, and disability plans on the same basis as other full-time employees of the Company. Mr. Rayment does not participate in the U.S. defined benefit plans because he transferred from the United Kingdom to the United States after those plans were closed to new entrants. The Company also offers a nonqualified executive deferred compensation plan, in accordance with Section 409A of the Code, whereby eligible executives, including the NEOs, may elect to defer additional cash compensation on a tax-deferred basis. The deferred compensation accounts are
maintained on the Company’s financial statements and accrue interest at the rate of (i) the average annual rate of interest payable on United States Treasury Bonds of 30 years maturity as determined by the Federal Reserve Board, plus (ii) 2%. Earnings are credited to executives’ accounts on a monthly basis.
Grants of Plan-Based Awards
The NEOs are given dividend credits on their restricted stock unit awards only. These dividends credits are reinvested into the restricted stock unit awards and are subject to the same limitations and restrictions as the original restricted stock unit award. The plan specifically prohibits the re-pricing of
options and requires that any equity-based grants be issued based on the closing price of The Committee granted cash-based performance units, performance shares, and restricted stock units in March
The following table sets forth the outstanding equity awards of the NEOs. Some of the grants disclosed below are not yet vested and are subject to forfeiture under certain conditions. Outstanding Equity Awards at Fiscal Year-End
The following table sets forth information regarding options exercised and stock vested during calendar year Option Exercises and Stock Vested
Deferred Compensation Plans The following table shows the deferred compensation activity for the NEOs during Non-Qualified Deferred Compensation Table
Total Pension Benefit Payable to Executive Officers The estimated total pension benefit payable under the Curtiss-Wright Retirement Plan and the nonqualified Curtiss-Wright Restoration Plan described above in “Pension Plans” to the NEOs at retirement age 65 is also described in the following table as a total lump sum payable from each of these plans, based on benefits earned through December 31,
Qualified Pension Benefit
Non-Qualified Pension Benefit
The Plan benefit formula is described earlier. Elements of compensation that are included in the calculation of a benefit are base salary earned and short and long-term cash incentives earned. The Company has not adopted a policy prohibiting special benefits under the plans. However, historically the Company has not provided any additional years of credited service to any participants in the Plan. The following table shows the potentialincremental value transfer to the NEOs under various employment related scenarios. The table does not include payments made to a NEO with respect to contracts, agreements, plans or arrangements to the extent they do not discriminate in scope, terms or operation, in favor of the Company’s executive officers and that are available generally to all salaried employees, such as the Company’s 401(k) plan. Potential Post-Employment Payment
PAY RATIO DISCLOSURE RULE In accordance with rules adopted by the Securities and Exchange Commission, the Company is providing the following information concerning the ratio of the Company’s median employee’s annual total compensation to the total annual compensation of the Company’s principal executive officer (“PEO”). For fiscal year 2023, the Company’s PEO is Lynn M. Bamford. The Committee does not use this ratio as it considers appropriate compensation for the PEO. Management does not use this ratio when determining compensation for the rest of the workforce. The Company identified the median employee by utilizing base salary as of December 1, 2023 and adding any target bonus to that amount, for all individuals, excluding the PEO, who were employed by the Company on December 31, 2023, the last day of the Company’s payroll year (whether employed on a full-time, part-time, or seasonal basis). In addition, the Company also excluded all independent contractors. The Company further converted all other currencies to U.S. dollars as of December 1, 2023, irrespective of currency fluctuations over the course of the year. Finally, the Company elected to use the de minimis exemption for non-U.S. employees to exclude 4.5% of the Company’s non-U.S. employees. The list of jurisdictions for which these employees are excluded, the approximate number of employees excluded from each jurisdiction, the total number of U.S. and non-U.S. employees irrespective of any exemption, and the total number of U.S. and non-U.S. employees used for the de minimis calculation are set forth in the table below.
After identifying the median employee, the Company calculated annual total compensation for such employee using the same methodology the Company uses for the named executive officers as set forth in the 2023 Summary Compensation Table in this Proxy Statement. The total compensation amount for the median employee for 2023 was determined to be $72,282. This total compensation amount was then compared to the total compensation of the PEO disclosed in the Summary Compensation Table, of $8,526,311. Based on this information for 2023, the ratio of the PEO’s annual total compensation to the annual total compensation of the median employee was 118:1. The Company believes that the ratio calculated above is not reflective of compensation awarded to our PEO in 2023. The total compensation of our PEO disclosed in the Summary Compensation Table includes the change in the actuarial present value of our PEO’s retirement benefits shown under column “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” of the Summary Compensation Table. The pension values for fiscal year 2023 reflect the impact of changes
in interest rates on actuarial present value calculations. Excluding this change in actuarial present value of the PEO’s pension benefit, the ratio would be 106:1. PAY VERSUS PERFORMANCE The following table shows the total compensation for our NEOs for the past four fiscal years, the “compensation actually paid” to our PEO and prior PEO and, on an average basis, our other NEOs (in each case, as determined under SEC rules), our TSR, the TSR of the Aerospace & Defense Select Industry Index over the same period, our Net Income, and our financial performance measure for compensatory purposes, Adjusted Operating Income.
PEO SCT Total to CAP Reconciliation:
Supplemental PEO Equity Component of CAP:
Average Non-PEO SCT Total to CAP Reconciliation:
Supplemental Average Non-PEO Equity Component of CAP:
For the fiscal year ending December 31, 2023, the most important financial performance measures used to link compensation actually paid to our NEOs to Company performance are set forth in the table below:
The following graph compares the compensation actually paid to our PEO(s), the average of the compensation actually paid to our non-PEOs and the Company’s TSR performance with the TSR performance of the Aerospace & Defense Select Industry Index. The TSR amount represents the value of an initial fixed $100 Investment in Curtiss-Wright stock on December 31, 2019 assuming reinvestment of all dividends. Compensation Actually Paid versus Total Shareholder Return
The following graph compares the compensation actually paid to our PEO(s) and the average of the compensation actually paid to our non-PEOs with the Company’s Net Income. Compensation Actually Paid versus Net Income The following graph compares the compensation actually paid to our PEO(s) and the average of the compensation actually paid to our non-PEOs with the Company’s Adjusted Operating Income. Compensation Actually Paid versus Adjusted Operating Income
COMPENSATION OF DIRECTORS The following table sets forth certain information regarding the compensation earned by or granted to each non-employee director who served on the Company’s Board of Directors in Director Compensation
In In addition to the annual retainer and meeting fees described above, under the Company’s 2014 Omnibus Incentive Plan, the Company, acting through the Committee on Directors and Governance, has the discretionary authority to make equity grants to non-employee Directors.
Delinquent Section 16(a) Reports Section 16(a) of the Securities Exchange Act and the rules thereunder of the SEC require the Company’s Directors, Officers, and beneficial owners of more than 10% of the Common Stock to file reports of their ownership and changes in ownership of Common Stock with the Commission. Personnel of the Company generally prepare these reports on behalf of the Directors and Officers on the basis of information obtained from each Director and Officer. Based solely on a review of these reports filed with the SEC and on the written representations from the Directors and Officers, the Company believes that all reports required by Section 16(a) of the Securities and Exchange Act to be filed during the year ended December 31, Certain Relationships and Related Transactions The Company’s legal department is primarily responsible for identifying relationships and transactions in which the Company and a director, any nominee for director, executive officer or more than 5% stockholder of the Company, including any of their immediate family members, and any entity owned or controlled by them, are participants to determine whether any of these related persons had or will have a direct or indirect material interest. In order to identify potential related person transactions, the Company’s legal department annually prepares and distributes to all directors, nominees for directors, and executive officers a written questionnaire, which includes questions intended to elicit information about any related person transactions. Further enhancing the Company’s commitment to identify any transactions with related persons, the Company’s finance department adopted a related party transactions policy, which requires each of the business units to identify and
disclose to the Company’s corporate controller and general counsel all related person transactions on a quarterly basis or on such shorter intervals as the situation arises. The Company’s corporate governance guidelines, applicable to Directors, and the Company’s code of conduct, applicable to all employees of the Company, including executive officers (copies of which may be viewed within the Corporate Governance section of the Company’s website at https: The Board of Directors has responsibility for reviewing and approving or ratifying related person transactions to the extent a director, nominee for director, executive officer or more than 5% stockholder of the Company, including any of their immediate family members, and any entity owned or controlled by them, are participants. To the extent that a proposed related-person transaction may involve a director, such individual may not participate in any decision by the Board that in any way relates to the matter that gives rise to the conflict of interest. The Company’s corporate controller and general counsel has responsibility for reviewing and approving or ratifying all other transactions in which the Company and any other employee (other than an executive officer) or his or her immediate family members has a direct or indirect material interest. Neither the corporate governance guidelines nor code of conduct specify the standards to be applied by the Board of Directors or the Company’s corporate controller and general counsel, as applicable, in reviewing transactions with related persons. However, the Company expects that in
general the Board of Directors or the Company’s corporate controller and general counsel, as applicable, will consider all of the relevant facts and circumstances, including, if applicable, but not limited to: (i) the benefits to the Company; (ii) the impact on a Director’s independence in the event the related person is a Director, an immediate family member of a Director, or an entity in which a Director is a partner, shareholder, or executive officer; (iii) the availability of other sources for comparable products or services; (iv) the terms of the transaction; and (v) the terms available for similar transactions with unrelated third parties. During fiscal year
Security Ownership of Certain Beneficial Owners and Management The following table sets forth information as of February
members of the group named in the first column, with sole voting and dispositive power. For purposes of this table, beneficial ownership is determined in accordance with the federal securities laws and regulations. Inclusion in the table of shares not owned directly by the Director or Named Executive Officer does not constitute an admission that such shares are beneficially owned by the Director or Named Executive Officer for any other purpose.
PROPOSAL TWO: RATIFICATION OF APPOINTMENT OF THE INDEPENDENT The Audit Committee of the Board of Directors has appointed the firm of Deloitte & Touche LLP (“Deloitte”) to act as the Company’s independent registered public accounting firm for its fiscal year ending December 31, The Audit Committee annually reviews Deloitte’s performance in deciding whether to retain Deloitte or engage a different independent registered public accounting firm. In making such determination, the Audit Committee considers, among other things, (i) an evaluation of Deloitte’s historical and recent performance on the Company’s audit; (ii) Deloitte’s capability and expertise in handling the breadth and complexity of the Company’s worldwide operations; (iii) recent Public Company Oversight Board (PCAOB) reports on Deloitte and its peer firms; (iv) appropriateness of Deloitte’s fees for audit and non-audit services, on both an absolute basis and as compared to its peer firms; and (v) the benefits of having a long-tenured auditor such as (1) a higher quality audit due to Deloitte’s institutional knowledge and deep understanding of the Company’s business, accounting policies and practices, and internal control over financial reporting; (2) an efficient fee structure as Deloitte’s fees are competitive with peer companies because of Deloitte’s familiarity with the Company’s business and industry; and (3) avoiding the costs and disruptions, including management time and distractions, associated with bringing on a new independent auditor. Based on this evaluation, the Audit Committee believes that the continued retention of Deloitte to serve as the Company’s independent registered public accounting firm is in the best interests of the Company and its stockholders. Representatives of Deloitte are expected to be present at the Annual Meeting to make such statements and answer such questions as are appropriate. Ratification of the appointment of Deloitte will require the affirmative vote of
nevertheless have authority to vote your shares on this “routine” proposal in your banks’, brokers’ or other holders’ of record discretion.
Disclosure about Fees The following table presents the aggregate fees billed by our independent registered public accountants, Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates for the audit of our annual financial statements for the calendar years ended December 31,
Pre-Approval Policy for Audit and Non-Audit Services The Audit Committee has adopted a policy to pre-approve audit and permissible non-audit services, provided by the independent accountants.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU PROPOSAL THREE: APPROVAL OF THE CURTISS-WRIGHT CORPORATION Overview On February 8, 2024, the Board of Directors, upon the recommendation of the Executive Compensation Committee, adopted the Curtiss-Wright Corporation 2024 Omnibus Incentive Plan (the “2024 Omnibus Incentive Plan”), subject to the approval of the stockholders at this Annual Meeting. The 2024 Omnibus Incentive Plan is intended to replace the Company’s 2014 Omnibus Incentive Plan (the “Prior Plan”), which was approved by the Company’s stockholders at the Company’s 2014 annual meeting on May 2, 2014. The 2024 Omnibus Incentive Plan will become effective as of the date of this Annual Meeting (the “Effective Date”) if approved by the Company’s stockholders and will not become effective if such approval is not received. If the 2024 Omnibus Incentive Plan is approved by the Company’s stockholders, 1,560,000 shares of the Company’s common stock will be available for awards under the 2024 Omnibus Incentive Plan, less one share for every one share that was subject to an award granted under the Prior Plan after December 31, 2023, and prior to the Effective Date of the 2024 Omnibus Incentive Plan. Stockholder approval of the 2024 Omnibus Incentive Plan is necessary for purposes of complying with New York Stock Exchange approval requirements for equity compensation plans. The purpose of the 2024 Omnibus Incentive Plan is to foster and promote the long-term financial success of the Company and to increase stockholder value by (i) providing eligible employees, officers, non-employee directors, consultants, and advisors of the Company with incentives that align their interests with stockholders’ interests and that contribute to the long-term growth and profitability of the Company, and (ii) enabling the Company to attract, retain and motivate highly qualified employees, officers, non-employee directors, consultants, and advisors who are in a position to make significant contributions to the Company for its successful operations. The Prior Plan will expire by its terms on May 2, 2024, which is the Effective Date of the 2024 Omnibus Incentive Plan, and no further grants may be made under the Prior Plan after this date. However, all outstanding awards under the Prior Plan will continue to be governed by the terms of the Prior Plan. If the 2024 Omnibus Incentive Plan is not approved by the Company’s stockholders at this Annual Meeting, the Company will be unable to maintain its current equity granting practices, and, therefore, it will be at a significant competitive disadvantage in the extremely competitive labor markets in which it competes in attracting, retaining, and motivating talented individuals who contribute to the Company’s success. The Company will also be compelled to replace equity incentive awards with additional cash awards, which may not align with the interests of the Company’s stockholders as effectively as equity incentive awards. Considerations for the Approval of the 2024 Omnibus Incentive Plan Corporate Governance Best Practices The 2024 Omnibus Incentive Plan has been designed to build upon the effectiveness of the Prior Plan and the 2024 Omnibus Incentive Plan incorporates certain corporate governance best practices to further align the Company’s equity compensation program with the interests of the Company’s stockholders. The following is a list of some of these best practices, which are intended to protect the interest of the Company’s stockholders:
Reasonable Burn Rate The Company recognizes the dilutive impact of its equity compensation on stockholders and continuously strives to balance this concern with the competition for talent. In the process used to determine the number of shares to be reserved for issuance under the 2024 Omnibus Incentive Plan, the Company reviewed information regarding the burn rate and dilution metrics discussed below. The Company believes the potential dilution to stockholders is reasonable and sustainable to meet its business goals. The Company considered its annual share pool usage over the most recently completed three-year period (or “burn rate”) with respect to the equity awards granted by the Company, as shown in the table below:
Reasonable Dilution The Company considered the potential dilution to stockholders that may result from the issuance of shares pursuant to outstanding equity awards and equity awards to be reserved for issuance under the 2024 Omnibus Incentive Plan. The table below sets forth information regarding the total equity dilution as of December 31, 2023:
If approved, the shares to be reserved for issuance under the 2024 Omnibus Incentive Plan, plus the number of shares subject to outstanding equity awards as of December 31, 2023, would result in total equity dilution of 4.68% on December 31, 2023, based on the number of shares of common stock outstanding as of such date. Sufficiency for Projected Future Grants The Company currently intends that the share reserve requested under the 2024 Omnibus Incentive Plan will be sufficient to fund the Company’s equity compensation needs for the foreseeable future. This assumes the Company continues to grant awards consistent with its historical usage and current practices, as reflected in our historical burn rate discussed above. The Company cannot predict its future equity grant practices, the future price of its shares or future hiring activity with any degree of certainty at this time, and the share reserve under the 2024 Omnibus Incentive Plan could last for a shorter or longer time. Summary of the Material Terms of the 2024 Omnibus Incentive Plan The 2024 Omnibus Incentive Plan includes terms that reflect the Company’s strong commitment to governance measures and plan design features considered important to stockholders. The following is a summary of the material terms and principal features of the 2024 Omnibus Incentive Plan. This summary does not purport to be complete and is subject to, and qualified in its entirety by, the 2024 Omnibus Incentive Plan. A copy of the 2024 Omnibus Incentive Plan has been filed with the SEC with this Proxy Statement as Appendix A. Stockholders are urged to read the complete text of the 2024 Omnibus Incentive Plan.
Purpose. The 2024 Omnibus Plan is designed to assist the Company and its subsidiaries in attracting and retaining selected individuals to serve as employees, directors, consultants and/or advisors who are expected to contribute to the Company’s success and to achieve long-term objectives that will benefit stockholders of the Company through the additional incentives inherent in the awards granted thereunder. Eligible Participants. Generally, any employee, non-employee director, consultant, or advisor of the Company or any subsidiary is eligible to participate in the 2024 Omnibus Plan. Since the 2024 Omnibus Incentive Plan provides the Executive Compensation Committee with discretion in selecting participants and making awards, the total number of persons who will participate in the 2024 Omnibus Incentive Plan cannot be determined at this time. In fiscal year end 2023, approximately 464 participants were granted awards under the Prior Plan. Awards. Awards under the 2024 Omnibus Incentive Plan may be made in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards, and performance cash, performance shares or performance units to any employee, officer, non-employee director, consultant, and advisor of the Company or any of its subsidiaries who is expected to make significant contributions to the success of the Company and the growth of its business (an “Eligible Participant”). Eligible Participants will be identified by the Company’s Executive Compensation Committee (the “Committee”). The Committee may, in its sole discretion, grant other types of awards, which awards may be payable in cash, stock, other property, or any combination thereof. Such awards may be paid in a lump sum or in installments or, in accordance with procedures established by the Committee, on a deferred basis subject to the requirements of Section 409A of the Code. Shares Available for Awards. If this proposal is approved by the stockholders, subject to adjustment in accordance with the 2024 Omnibus Incentive Plan, the maximum aggregate number of shares of common stock that may be issued under the 2024 Omnibus Incentive Plan will be 1,560,000 less one share of common stock for every one share of common stock granted under any Prior Plan after December 31, 2023 and prior to the effective date of the 2024 Omnibus Incentive Plan. The foregoing limit will be increased on a one-for-one basis by the number of shares of common stock with respect to which awards previously granted under the 2024 Omnibus Incentive Plan or after December 31, 2023 with respect to any Prior Plan are forfeited, expire or otherwise terminate without issuance of shares, or are settled for cash or otherwise do not result in the issuance of shares. In addition, if shares of common stock are tendered or withheld to pay the exercise price of an award or to satisfy tax withholding obligations under the 2024 Omnibus Incentive Plan or after December 31, 2023, with respect to awards under any Prior Plan, the foregoing limit will also be increased by the shares so tendered or withheld on a one-for-one basis. Further, in the case of any substitute award (as defined in the 2024 Omnibus Incentive Plan), such substitute award will not be counted against the number of shares reserved under the 2024 Omnibus Incentive Plan. Limits on Awards to Non-employee Directors. No non-employee director may be granted awards in any single year having an aggregate grant date fair value greater than $500,000. Minimum Vesting Requirements. Each award granted pursuant to the 2024 Omnibus Incentive Plan will vest over a period of not less than one year following the date of grant except for (i) substitute awards granted in connection with awards that are assumed, converted or substituted pursuant to a merger, acquisition or similar transaction entered into by the Company or any of its subsidiaries, (ii) shares of common stock delivered in lieu of fully vested cash obligations, (iii) awards to non-employee directors that vest on the earlier of the one-year anniversary of the date of grant and the next annual meeting of stockholders, which is at least 50 weeks after the immediately preceding year’s annual meeting, and (iv) any additional awards the Committee may grant, up to a maximum of 5% of the shares of common stock available for issuance under the 2024 Omnibus Incentive Plan. However, the Committee may, in its sole discretion, accelerate the vesting of an award or otherwise lapse or waive this requirement upon the participant’s retirement, death, disability or a change in control. In addition, the Committee may grant awards that are not subject to these minimum vesting requirements with respect to 5% or less of the maximum aggregate number of shares available for issuance under the 2023 Plan (as may be adjusted in accordance with the terms of the 2024 Omnibus Incentive Plan).
Administration of the 2024 Omnibus Plan. The 2024 Omnibus Incentive Plan will be administered by the Committee. The Committee has authority under the 2024 Omnibus Incentive Plan to:
To the extent not inconsistent with applicable law, with respect to awards intended to comply with the rules and regulations of the principal U.S. national securities exchange on which the Company’s shares are traded, the Committee may delegate the authority to grant awards under the 2024 Omnibus Incentive Plan, to (i) one or more executive officers of the Company (except that such delegation will not be applicable to any award for a person who is a director or executive officer of the Company then covered by Section 16 of the Exchange Act) and (ii) one or more committees of the Board (which may consist solely of one director). Types of Awards. The following is a summary of the types of awards available under the 2024 Omnibus Incentive Plan. In general, the Committee has the authority to determine all terms and conditions of awards, except where such authority is limited by an express provision of the 2024 Omnibus Incentive Plan. Stock Options. A stock option is a contractual right to purchase shares at a future date at a specified exercise price. The Committee may grant stock options that are either incentive stock options or non-qualified stock options. The per share exercise price of a stock option (other than a substitute award) will be determined by the Committee and may not be less than the closing price of a share on the grant date. The Committee will determine the date after which each stock option may be exercised and the expiration date of each option, provided that no option will be exercisable more than ten years after the grant date. Options that are intended to qualify as incentive stock options must meet the requirements of Section 422 of the Code. Stock Appreciation Rights (“SARs”). A stock appreciation right entitles the holder to receive, for each share as to which the award is granted, cash, shares, other property, or any combination thereof, an amount equal to the excess of (i) the fair market value of one share on the date of exercise (or such amount less than such fair market value as the Committee will so determine at any time during a specified period before the date of exercise) over (ii) the grant price of the SAR. Restricted Stock. A restricted stock award is a delivery of common stock, subject to transfer restrictions and a risk of forfeiture. Except as may otherwise be provided by the Committee, (subject to the plan’s minimum vesting requirements), upon the termination of the award holder’s employment or service for any reason during the period before the restricted stock has vested, or in the event the conditions to vesting are not satisfied, the restricted stock that has not vested will be forfeited. Unless the Committee determines otherwise, during the restricted period, the award holder will have the right to vote the restricted stock. Stock dividends will be treated as additional shares of restricted stock and will be subject to the same terms and conditions as the initial grant, unless otherwise provided by the
Committee, and cash dividends otherwise payable on a restricted stock award will accrue and be paid only at such time as the vesting conditions applicable to the underlying award have been satisfied. Restricted Stock Units (“RSUs”). An RSU award entitles the award holder to receive one share of common stock (or the fair market value of a share in cash or other property) at a specified future time. The Committee may condition the delivery of the shares, cash or other property upon the completion of a specified period of service, the attainment of specific performance goals, or other criteria, or may provide for the unconditional delivery of the shares, cash or other property on the specified date. The delivery date may be at or after the vesting requirements have been satisfied. In the event of termination of employment or service before the RSU award has vested, the award will be forfeited, except as may be provided by the Committee (subject to the plan’s minimum vesting requirements). RSUs will carry no voting rights until such time as shares of common stock are actually issued. The Committee has the right to determine whether and when dividend equivalents will be paid with respect to an RSU award, except that dividend equivalents otherwise payable on an RSU award will accrue and be paid only at such time as the vesting conditions applicable to the underlying award have been satisfied. Other Share-Based Awards. The Committee is authorized to grant awards of shares and other awards that are valued in whole or in part by reference to, or are otherwise based on, shares or other property (“Other Share-Based Awards”), including deferred stock units. Non-employee directors will be eligible to elect to defer their fees or retainers and receive Other Share-Based Awards in the form of deferred stock units or deferred cash in lieu of all or a portion of their annual retainer, any chairman retainer, or meeting fees. In addition, non-employee directors may elect to receive Other Share-Based Awards in the form of deferred stock units or deferred cash in lieu of all or a portion of their annual and committee retainers and annual meeting fees, provided that such election is made in accordance with the requirements of Section 409A of the Code. The Committee will, in its absolute discretion, establish such rules and procedures as it deems appropriate for such elections and for payment in deferred stock units or cash. Performance Awards. The Committee is authorized to grant awards, denominated and/or payable in cash, common stock, or other property, where either the grant or vesting of the award is subject to satisfaction of pre-established performance conditions. The Committee may use such business criteria and other measures of performance as it deems appropriate in establishing any performance conditions. Dividends and Dividend Equivalents. In no event shall dividends or dividend equivalents be paid with respect to stock options or SARs. Notwithstanding any other provision of the Plan to the contrary, with respect to any award that provides for or includes a right to dividends or dividend equivalents, if dividends are declared during the period that an equity award is outstanding, such dividends (or dividend equivalents) will either (i) not be paid or credited with respect to such award or (ii) be accumulated but remain subject to vesting requirement(s) to the same extent as the applicable award and will only be paid at the time or times such vesting requirement(s) are satisfied. Change in Control. Except as otherwise specifically provided in the applicable award agreement, upon the consummation of a change in control (as defined in the 2024 Omnibus Incentive Plan), in which the successor company assumes or substitutes for a stock option, SAR, restricted stock award, RSU award or Other Share-Based award (or in which the Company is the ultimate parent corporation and continues the award), if an Eligible Participant’s employment with such successor company (or the Company) or a subsidiary thereof terminates within 24 months following such change in control (or such other period set forth in the award agreement, including prior thereto if applicable) and under the circumstances specified in the award agreement: (i) stock options and SARs outstanding as of the date of such termination of employment will immediately vest, become fully exercisable, and may thereafter be exercised for 24 months (or the period of time set forth in the award agreement), (ii) the restrictions, limitations and other conditions applicable to restricted stock and RSUs outstanding as of the date of such termination of employment will lapse and the restricted stock and RSUs will become free of all restrictions, limitations and conditions and become fully vested, and (iii) the restrictions, limitations and other conditions applicable to any Other Share-Based Awards will lapse, and such Other Share-Based Awards will become free of all restrictions, limitations and conditions and become fully vested and
transferable to the full extent of the original grant. To the extent the successor company does not assume or substitute for a stock option, SAR, restricted stock award, RSU award or Other Share-Based award (or in which the Company is the ultimate parent corporation and does not continue the award), then immediately prior to the change in control: (i) those stock options and SARs outstanding as of the date of the Change in Control that are not assumed or substituted for (or continued) will immediately vest and become fully exercisable, (ii) restrictions, limitations and other conditions applicable to restricted stock and RSUs that are not assumed or substituted for (or continued) will lapse and the restricted stock and RSUs will become free of all restrictions, limitations and conditions and become fully vested, and (iii) the restrictions, other limitations and other conditions applicable to any Other Share-Based Awards or any other Awards that are not assumed or substituted for (or continued) will lapse, and such Other Share-Based Awards or such other awards will become free of all restrictions, limitations and conditions and become fully vested and transferable to the full extent of the original grant. Adjustments. In the event of any merger, reorganization, consolidation, recapitalization, dividend or distribution (whether in cash, shares or other property, other than a regular cash dividend), stock split, reverse stock split, spin-off or similar transaction or other change in corporate structure affecting the shares or the value thereof, such adjustments and other substitutions will be made to the 2024 Omnibus Incentive Plan and to awards in a manner the Committee deems equitable or appropriate taking into consideration the accounting and tax consequences, including adjustments in the number and class of shares of stock available for awards under the 2024 Omnibus Incentive Plan, and the number, class and exercise or grant price of shares subject to awards outstanding under the 2024 Omnibus Incentive Plan. Cancellation of Award; Forfeiture of Gain. The Committee reserves the right to cancel all or any portion of any outstanding awards and cause a forfeiture of the gain realized by an Eligible Participant with respect to an award on account of a restatement of the Company’s financial statements or actions taken by, or failed to be taken by, the Eligible Participant in violation or breach of, or in conflict with, any non-competition agreement, agreement prohibiting solicitation of employees or customers of the Company, non-disclosure covenant, or other agreement or any other obligation of the Eligible Participant to the Company. Term. The 2024 Omnibus Incentive Plan will be effective on the date of the approval of the 2024 Omnibus Incentive Plan by the holders of the shares entitled to vote at a duly constituted meeting of the stockholders of the Company. No award may be granted under the 2024 Omnibus Incentive Plan after the earliest to occur of (i) the 10-year anniversary of the date of stockholder approval of the 2024 Omnibus Incentive Plan, (ii) the maximum number of shares available for issuance under the 2024 Omnibus Incentive Plan has been issued or (iii) the Board terminates the 2024 Omnibus Incentive Plan. 2024 Omnibus Plan Amendment and Termination. Generally, the Board may, at any time, alter, amend, suspend or terminate the 2024 Omnibus Incentive Plan as it shall deem advisable, subject to any requirement for stockholder approval imposed by applicable law, including the rules and regulations of the principal U.S. national securities exchange on which the shares are traded. The Board may not (except pursuant to substitute awards, adjustment in certain circumstances as discussed under “Adjustments” above), without the approval of the Company’s stockholders, cancel a stock option or SAR in exchange for cash when the exercise or grant price per share exceeds the fair market value of one share or take any action with respect to a stock option or SAR that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the shares are traded. In addition, no amendments to, or termination of, the 2024 Omnibus Incentive Plan will impair the rights of an Eligible Participant in any material respect under any award previously granted without such Eligible Participant’s consent. Compensation Recovery. The Committee will have full authority to subject awards to clawback, recovery or recoupment as provided in the award agreement. Any awards granted under the 2024 Omnibus Incentive Plan will be subject to any clawback, recovery or recoupment arrangements or policies the Company has in place from time to time.
U.S. Federal Income Tax Consequences The information set forth below is a brief summary of certain of the U.S. federal income tax consequences to an Eligible Participant under the 2024 Omnibus Incentive Plan. It does not purport to be a complete discussion of all federal tax consequences, nor does it address any state, local or foreign tax considerations. The information is based upon current federal income tax rules and therefore is subject to change. Because the tax consequences to any Eligible Participant may depend on his or her particular situation, each Eligible Participant should consult his or her tax adviser regarding the federal, state, local, and other tax consequences of the grant or exercise of an award or the disposition of stock acquired as a result of an award. The 2024 Omnibus Incentive Plan is not qualified under the provisions of Section 401(a) of the Code and is not subject to any of the provisions of the Employee Retirement Income Security Act of 1974. The Company’s ability to realize the benefit of any tax deductions described below depends on the Company’s generation of taxable income as well as the requirement of reasonableness, the provisions of Section 162(m) of the Code and the satisfaction of the Company tax reporting obligations. Incentive Stock Options (“ISO”). An Eligible Participant will not recognize taxable income on the grant or exercise of an ISO (although the excess of the fair market value of the common stock over the exercise price will be included for alternative minimum tax purposes in the year of exercise). An Eligible Participant will recognize taxable income when he or she disposes of the shares of common stock acquired under the ISO. If the disposition occurs more than two years after the grant of the ISO and more than one year after its exercise (the “ISO holding period”), the Eligible Participant will recognize long-term capital gain (or loss) to the extent the amount realized from the disposition exceeds (or is less than) the Eligible Participant’s tax basis in the shares of common stock. An Eligible Participant’s tax basis in the shares of common stock acquired under an ISO generally will be the amount the Eligible Participant paid for the stock. If common stock acquired under an ISO is disposed of before the expiration of the ISO holding period described above, the Eligible Participant will recognize as ordinary income in the year of the disposition the excess of the fair market value of the common stock on the date of exercise of the ISO over the exercise price. Any additional gain will be treated as long-term or short-term capital gain, depending on the length of time the Eligible Participant held the shares. Special rules apply if a participant pays the exercise price by delivery of common stock. The Company will not be entitled to a federal income tax deduction with respect to the grant or exercise of an ISO. However, in the event an Eligible Participant disposes of common stock acquired under an ISO before the expiration of the ISO holding period described above, the Company generally will be entitled to a federal income tax deduction equal to the amount of ordinary income the Eligible Participant recognizes on the disqualifying disposition. Nonqualified Stock Options (“NQSOs”). An Eligible Participant will not recognize any taxable income on the grant of a NQSO. On the exercise of a NQSO, the Eligible Participant will recognize as ordinary income the excess of the fair market value of the common stock acquired over the exercise price. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. An Eligible Participant’s tax basis in the common stock then is the amount paid for the shares of common stock plus any amounts included in income on exercise of the NQSO. Special rules apply if a participant pays the exercise price by delivery of common stock. The exercise of a NQSO generally will entitle the Company to claim a federal income tax deduction equal to the amount of ordinary income the Eligible Participant recognizes on exercise of the NQSO. Restricted Stock Awards. An Eligible Participant will recognize ordinary income on account of a Restricted Stock Award on the first day that the shares are either transferable or no longer subject to a substantial risk of forfeiture. The ordinary income recognized will equal the excess of the fair market value of the common stock on such date over the price, if any, paid for the stock. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. Dividends paid on Restricted Stock Awards prior to the date on which the forfeiture restrictions lapse generally will be treated as compensation that is taxable as ordinary income to the Eligible Participant. However, even if the shares under a Restricted Stock Award are both nontransferable and subject to a substantial risk of forfeiture, the Eligible Participant may make a special “83(b) election” to recognize income, and have his or her tax consequences determined, as of the date of grant of the Restricted Stock Award. The Eligible Participant’s tax basis in the shares
received under the Restricted Stock Award will equal the income recognized plus the price, if any, paid for the Restricted Stock Award. The Company generally will be entitled to a federal income tax deduction equal to the ordinary income the Eligible Participant recognizes with respect to the Restricted Stock Award. Restricted Stock Units (“RSUs”). An Eligible Participant will not recognize any taxable income at the time RSUs are granted. When the terms and conditions to which the RSUs are subject have been satisfied and the RSUs are settled, the Eligible Participant will recognize as ordinary income the fair market value of the common stock and the value of the cash (if the RSUs are settled in whole or in part in cash) he or she receives on settlement of the RSUs. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. The Company generally will be entitled to a federal income tax deduction equal to the ordinary income the Eligible Participant recognizes on settlement of the RSUs. Stock Appreciation Rights (“SARs”). An Eligible Participant will not recognize any taxable income at the time SARs are granted. The Eligible Participant at the time of receipt will recognize as ordinary income the amount of cash and the fair market value of the common stock that he or she receives on exercise of the SAR. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. The Company generally will be entitled to a federal income tax deduction equal to the amount of ordinary income the Eligible Participant recognizes on exercise of the SAR. Performance Awards. An Eligible Participant will not recognize any taxable income at the time Performance Awards are granted. When the terms and conditions to which the Performance Awards are subject have been satisfied and the Performance Awards are settled, the Eligible Participant will recognize as ordinary income the fair market value of the common stock and the value of the cash (if the Performance Awards are settled in whole or in part in cash) he or she receives on settlement of the Performance Awards. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. The Company generally will be entitled to a federal income tax deduction equal to the ordinary income the Eligible Participant recognizes on settlement of the Performance Awards. Other Share-Based Awards. The grant of Other Share-Based Awards will not be a taxable event for the Eligible Participant. When the conditions and requirements for the grants have been satisfied and the payment determined, any cash received and the fair market value of any common stock received will constitute ordinary income to the Eligible Participant. Cash Payments. An Eligible Participant of a cash performance award or other cash payment generally will recognize ordinary income on the date of payment. If the Eligible Participant is employed by the Company or one of its affiliates, that income will be subject to withholding taxes. Section 409A. The 2024 Omnibus Incentive Plan is intended to comply with Code Section 409A to the extent that such section would apply to any award granted under the 2024 Omnibus Incentive Plan. Code Section 409A governs the taxation of deferred compensation. Certain awards under the 2024 Omnibus Incentive Plan, including RSUs, may be subject to the requirements under Code Section 409A. If such awards fail to comply with the applicable requirements of Code Section 409A, the award holder may be subject to an additional 20% income tax and interest and may be required to recognize income earlier than intended under the award. Company Deductions. As a general rule, the Company or one of its subsidiaries will be entitled to a deduction for federal income tax purposes at the same time and in the same amount that an Eligible Participant recognizes ordinary income from awards under the 2024 Omnibus Incentive Plan, to the extent such income is considered reasonable compensation under the Code. The Company will not, however, be entitled to a deduction with respect to payments that are contingent upon a change in control if such payments are deemed to constitute “excess parachute payments” under Section 280G of the Code and do not qualify as reasonable compensation pursuant to that Section; such payments will subject the recipients to a 20% excise tax. In addition, the Company will not be entitled to a deduction to the extent compensation in excess of $1 million is paid to any NEOs who were employed by the Company at year-end. Section 162(m)
generally disallows a public company’s tax deduction for compensation to covered employees in excess of $1 million in any tax year. Compensation, for this purpose, includes taxable income attributable to awards granted under the 2024 Omnibus Incentive Plan and, therefore, some awards may not be fully deductible by the Company under Code Section 162(m). Registration with the SEC If the stockholders approve this proposal, the Company will file with the SEC, as soon as reasonably practicable after such approval, a registration statement on Form S-8 relating to the shares available for issuance under the 2024 Omnibus Incentive Plan. New Plan Benefits A new plan benefits table for the 2024 Omnibus Incentive Plan is not provided because all awards to be granted under the 2024 Omnibus Incentive Plan will be made at the Committee’s discretion, subject to the terms of the 2024 Omnibus Incentive Plan. No awards have yet been granted under the 2024 Omnibus Incentive Plan. Therefore, the benefits and amounts that will be received or allocated under the 2024 Omnibus Incentive Plan are not determinable at this time. However, information on awards granted in 2023 to NEOs and Directors under the Prior Plan is set forth under the sections titled “Executive Compensation” and “Compensation of Directors” in this Proxy Statement. Approval of the 2024 Omnibus Incentive Plan will require the affirmative vote of a majority of the shares of Company Common Stock present in person or represented by proxy (and eligible to vote) at the Annual Meeting, assuming the presence of a quorum. As further discussed in the section titled “Broker non-votes” on page 10 of this Proxy Statement, if you own shares of Common Stock through a bank, broker or other holder of record, you must instruct your bank, broker or other holder of record how to vote in order for them to vote your shares of Common Stock so that your vote can be counted on this Proposal Three. RECOMMENDATION OF THE BOARD OF DIRECTORS THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE PROPOSAL FOUR: ADVISORY Overview The Board of Directors is committed to excellence in governance. As part of that commitment, and as required by Section 14A(a)(1) of the Securities Exchange Act of 1934, as amended, the Board of Directors is providing the stockholders with an opportunity to provide an advisory vote to approve executive compensation (commonly known as a “Say-on-Pay” proposal). The Board of Directors recognizes that providing stockholders with an advisory vote to approve executive compensation may produce useful information on investor sentiment with regard to the Company’s executive compensation programs. At the
Compensation Objectives As generally described in the above “Compensation Discussion and Analysis” section of this Proxy Statement, the Company’s executive compensation program is designed to attract and retain high quality executives and to align the interest of management with the interests of stockholders by rewarding both short and long-term performance. Company Performance
Despite the Incentive awards earned by the Named Executive Officers for fiscal
The Company’s financial performance above includes adjustments referenced in the Company’s fourth quarter 2023 earnings release furnished to the SEC on February 15, 2024. The Company’s financial performance above excludes the performance of any acquisitions consummated during the performance The Company urges its stockholders to read the above “Compensation Discussion and Analysis” section of this Proxy Statement, which describes in more detail how the Company’s executive compensation policies and procedures operate and are designed to achieve the Company’s compensation objectives, as well as the Summary Compensation Table and related compensation tables and narratives which provide detailed information on the compensation of the Named Executive Officers. The Executive Compensation Committee believes that the policies and procedures articulated in the above “Compensation Discussion and Analysis” section of this Proxy Statement are effective in
achieving the Company’s goals and that the compensation of the Named Executive Officers reported in this Proxy Statement has supported and contributed to the Company’s success. The Board recommends that stockholders continue to support this compensation program by voting on the following resolution: “RESOLVED, that the stockholders of Curtiss-Wright Corporation approve, on an advisory basis, the compensation paid to the Company’s Named Executive Officers, as disclosed in the Proxy Statement for the This vote is advisory, and therefore not binding on the Company, the Executive Compensation Committee, or the Board of Directors. It will not overrule any decisions made by the Board of Directors or the Executive Compensation Committee or require the Board of Directors or the Executive Compensation Committee to take any specific action. The Board of Directors and the Executive Compensation Committee value the opinions of the stockholders, and, to the extent there is any
significant vote against the Named Executive Officers compensation as disclosed in this Proxy Statement, the Board of Directors will consider the stockholder concerns and the Executive Compensation Committee will evaluate whether any actions are necessary to address those concerns. Adoption of this resolution will require the affirmative vote of RECOMMENDATION OF THE BOARD OF DIRECTORS THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU HOUSEHOLDING OF ANNUAL DISCLOSURE DOCUMENTS The SEC has adopted rules governing the delivery of annual disclosure documents that permit us to send a single set of our Notice of Internet Availability of Proxy Materials, and for those stockholders that received a paper copy of the proxy materials in the mail, a single set of our annual report and proxy statement, to any household at which two or more stockholders reside if we believe that the stockholders are members of the same family, unless we have received contrary instructions from one or more of the stockholders. This rule benefits both stockholders and the Company. It reduces the volume of duplicate information received and helps to reduce our expenses. Each stockholder will continue to receive a separate proxy card if they received a paper copy of the proxy materials in the mail. If your household received a single set of such disclosure documents for this year, but you would prefer to receive your own copy now or in the future, please contact our transfer agent, Broadridge Financial Solutions, Inc., by calling their toll-free number, 1-800-542-1061, or writing to Broadridge Financial Solutions, Inc., Householding Department, 51 Mercedes Way, Edgewood, New York 11717. A separate copy of such disclosure documents will be promptly provided to you upon receipt of your request. Stockholders sharing an address who are receiving multiple copies of the Notice of Internet Availability of Proxy Materials or our proxy statement and annual report, as applicable, and who wish to receive a single copy of such materials in the future, please contact Broadridge Financial Solutions, Inc. as indicated above.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS Pursuant to regulations of the SEC, stockholders who intend to submit proposals for inclusion in our proxy materials for the If a stockholder of record wishes to nominate Directors or bring other business to be considered by stockholders at the
Meeting, then such nominations and proposals must be delivered in writing to the Company no earlier than 120 days prior to the Please note that these requirements relate only to matters proposed to be considered for the In addition to satisfying the foregoing requirements under our Amended and Restated By-laws, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 2, 2025. 2023 ANNUAL REPORT ON FORM 10-K Any stockholder wishing to receive, without charge, a copy of the Company’s
OTHER MATTERS WHICH MAY BE PRESENTED The Board of Directors does not intend to present for action at this Annual Meeting any matter other than those specifically set forth in the Notice of Annual Meeting. If any other matter is properly presented for action at the Annual Meeting, it is the intention of persons named in the proxy to vote thereon in accordance with their judgment pursuant to the discretionary authority conferred by the proxy.
Appendix A
CURTISS-WRIGHT CORPORATION 2024 OMNIBUS INCENTIVE PLAN Effective May 2, 2024 Curtiss-Wright Corporation (the “Company”), a Delaware corporation, hereby establishes and adopts the following 2024 Omnibus Incentive Plan (the “Plan”). 1. Purpose of the Plan The purpose of the Plan is to assist the Company and its Subsidiaries in attracting and retaining selected individuals to serve as employees, directors, consultants and/or advisors who are expected to contribute to the Company’s success and to achieve long-term objectives that will benefit stockholders of the Company through the additional incentives inherent in the Awards hereunder. 2. Definitions
3. Shares Subject to the Plan
4. Eligibility and Administration
5. Options
6. Stock Appreciation Rights
7. Restricted Stock and Restricted Stock Units
8. Other Share-Based Awards
9. Performance Awards
10. Change in Control Provisions
CURTISS-WRIGHT CORPORATION
VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
VOTE IN PERSON You may vote these shares in person by attending the annual meeting. Directions to the meeting are available at www.proxyvote.com.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on Thursday, May
CURTISS-WRIGHT CORPORATION
The undersigned hereby constitutes and appoints
If no direction is given, this proxy will be voted FOR the Director nominees listed in Proposal One and FOR Proposals Two, Three, and
The undersigned hereby acknowledge(s) receipt of a copy of the accompanying Notice of Annual Meeting of Stockholders, the proxy statement with respect thereto, the Company’s
Continued and to be signed on reverse side
0000026324 4 2023-01-01 2023-12-31 |