UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A
(Rule
14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

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Securities Exchange Act of 1934

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§240.14a-12

Owens & Minor, Inc.

(Name of registrantRegistrant as specifiedSpecified in its charter)

Charter)

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LOGO


LOGO

Street Address (1)Mailing Address
9120 Lockwood Boulevard 

Amount previously paid:

P.O. Box 27626
Mechanicsville, Virginia 23116 (2) 

Form, Schedule or Registration Statement No:

(3)

Filing party:

(4)

Date Filed:


LOGO

Notice of

2018

Annual Meeting

and

Proxy Statement

WHETHER OR NOT YOU PRESENTLY PLAN TO ATTEND THE MEETING IN

PERSON, THE BOARD OF DIRECTORS URGES YOU TO VOTE.

Owens & Minor, Inc.

9120 Lockwood Boulevard

Mechanicsville, Virginia 23116


LOGO

9120 Lockwood Boulevard

Mechanicsville,Richmond, Virginia 23116

(804)723-7000

23261-7626

March 26, 201827, 2024

Dear Shareholders:

It is a pleasure to invite you to ourthe Owens & Minor, Inc. Annual Meeting of Shareholders on Tuesday,Thursday, May 8, 20189, 2024 at 9:00 a.m. Eastern Daylight Time. The meetingAnnual Meeting will be held at The Jefferson Hotel, Empire Room, 101 West Franklin Street, Richmond, Virginia, 23220. Directionsin a virtual meeting format only, via the Internet, which allows us to The Jefferson Hotel aremake participation accessible for shareholders from any geographic location while reducing the costs and environmental impact associated with holding an in-person meeting. Information regarding attending the virtual Annual Meeting can be found on the last page 77 of the proxy statement.Proxy Statement.

The Notice of 20182024 Annual Meeting of Shareholders and Proxy Statement describe the items of business for the meeting. In addition to considering these matters, we will review significant accomplishments and events since our last shareholders’ meeting, as well as future opportunities and initiatives we intend to pursue. Our Board of Directors and management team will be therepresent to discuss items of interest and to answer any questions.

The Notice of 20182024 Annual Meeting of Shareholders contains instructions on how to access our proxy materials and our 20172023 Annual Report/Form10-K over the Internet, as well as how shareholders can receive paper copies of such documents, if they so desire.

You may vote your shares byvia the Internet or by telephone or, if you prefer, you may request paper copies of the proxy materials and submit your vote by mail by following the instructions on the proxy card. We encourage you to vote via the Internet. Whichever method you choose, your vote is important so please vote as soon as possible. All of us at Owens & Minor appreciate your continued interest and support.

Warm regards,

 

LOGO

P. CODY PHIPPSLOGO

Chairman, PresidentMark A. Beck

Chair of the Board of Directors

Owens & Chief Executive OfficerMinor, Inc.

WHETHER OR NOT YOU PRESENTLY PLAN TO ATTEND THE MEETING,

THE BOARD OF DIRECTORS URGES YOU TO VOTE.


Proxy Statement


Table of Contents

YOUR VOTE IS IMPORTANT

Your Vote Is Important

Whether or not you plan to attend the annual meeting,Annual Meeting, please vote your shares promptly, as instructed in the Notice of InternetRegarding the Availability of Proxy Materials, by the Internet or by telephone. You may also request a paper proxy card to submit your vote by mail, if you prefer. We encourage you to vote via the Internet.

Non-GAAP measures. This document contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (GAAP). In general, the measures exclude items and charges that (i) management does not believe reflect Owens & Minor, Inc.’s (the Company) core business and relate more to strategic, multi-year corporate activities; or (ii) relate to activities or actions that may have occurred over multiple or in prior periods without predictable trends. Management uses these non-GAAP financial measures internally to evaluate the Company’s performance, evaluate the balance sheet, engage in financial and operational planning and determine incentive compensation. Management provides these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on its financial and operating results and in comparing the Company’s performance to that of its competitors. However, the non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by the Company should not be considered substitutes for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth above should be carefully evaluated. A description of these non-GAAP financial measures and a reconciliation to the most comparable GAAP equivalent financial measures are included in the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2024.


LOGO


Notice of Annual Meeting of Shareholders

LOGO

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To Be Held Tuesday,Thursday, May 8, 20189, 2024

TO THETHE SHAREHOLDERS OFOF OWENS & MINOR, INC.:

The Annual Meeting of Shareholders of Owens & Minor, Inc. (the “Company” or, “Owens & Minor”, “we”, “us”, “our”, etc.) will be held virtually, via the Internet, on Tuesday,Thursday, May 8, 20189, 2024 at 9:00 a.m. EDTEastern Daylight Time (“EDT”). You will be able to attend the Annual Meeting online, listen to the meeting live, submit questions and vote. To be admitted to the Annual Meeting at The Jefferson Hotel, Empire Room, 101 West Franklin Street, Richmond, Virginia, 23220.www.meetnow.global/MQUPCLA you must enter the control number found on your proxy card, voting instruction form or notice you previously received. We encourage you to access the meeting in advance of the designated start time.

The purposes of the meeting are:

 

1.

To elect the 10nine directors named in the attached proxy statement,Proxy Statement, each for aone-year term and until their respective successors are elected and qualified;

 

2.To approve the Owens & Minor, Inc. 2018 Stock Incentive Plan;

3.To ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2018;2024;

 

3.

To approve the amendment to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan;

4.

To conduct an advisory vote to approve the compensation of the Company’s named executive officers; and

 

5.

To transact any other business properly before the annual meeting.Annual Meeting.

Shareholders of record as of March 13, 201814, 2024 will be entitled to vote at the annual meeting.Annual Meeting.

Your attention is directed to the attached proxy statement.Proxy Statement. The Notice of InternetRegarding the Availability of Proxy Materials is being distributed on or about March 26, 2018.27, 2024. This proxy statement,Proxy Statement, the proxy card and Owens & Minor’s 20172023 AnnualReport/Form10-KForm 10-K are being furnished on the Internet on or about March 26, 2018.27, 2024.

BY ORDER OFOF THETHE BOARD OFOF DIRECTORS,

 

LOGOLOGO

NHICHOLASEATH J. PH. GACEALLOWAY

Executive Vice President, General Counsel &

Corporate Secretary & Communications

 

Owens & Minor, Inc.2024 Proxy Statementi


Proxy Statement Summary


This summary highlights information contained in this Proxy Statement. This summary does not contain all the information that you should consider, and you should carefully read the entire Proxy Statement before voting.

LOGOAnnual Meeting of Shareholders

 

Time and Date: Virtually at 9:00 a.m., EDT, Thursday, May 9, 2024

Place: Audio webcast at www.meetnow.global/MQUPCLA

Record Date: Close of business on March 14, 2024

Voting: Shareholders as of the record date are entitled to vote; each share of common stock (“Common Stock”) is entitled to one vote for each director nominee and one vote for each of the other proposals

Voting Matters and Recommendations

   

Items of Business

 Board Recommendation Page

1

 

Election of nine director nominees to serve one-year terms

 

“FOR” Each Nominee

 

21

 

2

 

 

Ratification of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2024

 

“FOR”

 

27

3

 

Approval of Amendment No. 1 to the 2023 Omnibus Incentive Plan

 

“FOR”

 

30

4

 

Advisory vote on the compensation of our named executive officers

 

“FOR”

 

75

Director Nominees

             Committee Memberships 

Name

 Primary Occupation Age  

Director

Since

  Independent  Audit  Exec  

Gov &

Nom

  OP&C 

Mark A. Beck

 

Chair of the Board, Owens & Minor, Inc.

Co-founder and Owner of B-Square Precision, LLC

 

 

 

 

58

 

 

 

 

 

 

2019

 

 

 

 

 

LOGO

 

     

 

LOGO

 

 

 

LOGO

 

 

 

LOGO

 

Gwendolyn M. Bingham

 

 

Retired United States Army Lieutenant General (three stars)

 

  

 

64

 

 

 

  

 

2020

 

 

 

 

 

LOGO

 

     

 

LOGO

 

 

 

LOGO

 

    

Kenneth Gardner-Smith

 

 

Chief People Officer, DaVita, Inc.

 

  

 

43

 

 

 

  

 

2022

 

 

 

 

 

LOGO

 

              LOGO 

Robert J. Henkel

 

 

Retired President and Chief Executive Officer, Ascension Healthcare

 

  

 

69

 

 

 

  

 

2019

 

 

 

 

 

LOGO

 

     

 

LOGO

 

     

 

LOGO

 

Rita F. Johnson-Mills

 

 

President (Southern Region), CINQCARE

 

  

 

65

 

 

 

  

 

2022

 

 

 

 

 

LOGO

 

         

 

LOGO

 

    

Stephen W. Klemash

 

 

Retired Partner, Ernst & Young LLP

Former Lead Partner, Ernst & Young Americas Center for Board Matters

 

  

 

63

 

 

 

  

 

2021

 

 

 

 

 

LOGO

 

 

 

LOGO

 

 

 

LOGO

 

        

Teresa L. Kline

 

 

Retired President and Chief Executive Officer of Health Alliance Plan of Michigan and Executive Vice President of Henry Ford Health System

 

  

 

65

 

 

 

  

 

2022

 

 

 

 

 

LOGO

 

 

 

LOGO

 

            

Edward A. Pesicka

 

 

President & Chief Executive Officer, Owens & Minor, Inc.

 

  

 

57

 

 

 

  

 

2019

 

 

 

         

 

LOGO

 

        

Carissa L. Rollins

 

 

Chief Information Officer, Illumina, Inc.

 

  

 

54

 

 

 

  

 

2022

 

 

 

 

 

LOGO

 

 

 

LOGO

 

            

Audit = Audit Committee Exec = Executive Committee Gov & Nom = Governance & Nominating Committee

OP&C = Our People & Culture Committee

Owens & Minor, Inc.2024 Proxy Statement1


 Proxy Statement Summary 

Director Nominee Group Information

LOGO

Our Corporate Governance Highlights

Street AddressDirector Independence and Board Leadership

 

Mailing Address   All directors, including our Board Chair, are independent except for our CEO

   Only independent directors serve on the Audit, Governance & Nominating, and Our People & Culture Committees

   The independent directors on our Board and our Board committees conduct regular executive sessions without management

9120 Lockwood Boulevard

Board Evaluation,
Selection and Diversity

 

P.O. Box 27626   The Board and each of its committees conduct an annual self-evaluation to assess their respective performance

   The Governance & Nominating Committee identifies Board candidates based on selection criteria and considers candidates with diversity of experiences, gender, ethnicity and race for director vacancies

   Our Bylaws provide that no director nominee can stand for election if the nominee is over age 72

   5 of 9 director nominees are women and/or racially diverse

   Average age of director nominees is 60

Mechanicsville, Virginia 23116

Board and Committee Oversight

 

Richmond, Virginia 23261-7626   The Board actively engages annually in comprehensive senior management succession planning

   The Board and its committees perform risk oversight of our Company, including our ERM program, ESG framework and governance structure, cybersecurity and information security risks

   Each Board committee oversees the specific financial, compensation and governance risks related to its functions and responsibilities

Governance Practices

   Annual review of our Corporate Governance Guidelines and Board committee charters

   Our insider trading policy prohibits hedging or pledging Owens & Minor stock

   Recoupment (“clawback”) policy for incentive compensation, including performance-based cash compensation and all equity compensation

   Maintain substantial stock ownership requirements for directors and executive officers

   Our Code of Honor applies to our directors, executive officers and all teammates

   Corporate Governance Guidelines limit director membership on other public company boards

Shareholder Rights

   Declassified Board with annual election of our directors serving one-year terms

   Majority voting standard for uncontested director elections (plurality voting in contested elections)

   Proxy access allowing holders of 3% of our stock for at least three years to include the greater of two nominees or nominees representing 20% of board seats in our proxy statement if they satisfy the requirements in our Company Bylaws

   Annual shareholder advisory vote on the compensation of our named executive officers

PROXY STATEMENT

2Owens & Minor, Inc.2024 Proxy Statement


 Proxy Statement Summary 

Our Executive Compensation Highlights

Executive Compensation Philosophy

Our executive compensation program which is described in more detail in our “Compensation Discussion and Analysis” section is designed with a pay-for-performance philosophy that aligns with the business’s strategy and goals, both short and long-term, and pays for sustained performance, profitable growth, and achievement of results. We generally target the 50th percentile of our peer group and the relevant market as a reference point for positioning target total compensation for our executives,1 with the ability to earn above or below the 50th percentile based on Company and/or individual performance. Key considerations when determining an executive’s compensation include experience, size and scope of role, pay position relative to the market, internal equity, and talent retention.

We designed our executive compensation program framework to reward for Company and individual performance and focus on the following objectives:

Reasonable but market-competitive base salaries to attract, motivate and retain executives.

Appropriate balance between short- and long-term incentives and fixed and at-risk incentive compensation, to weigh cost against expected benefit and to align with the creation of shareholder value, including:

Annual cash incentives to drive critical business results each year; and

Long-term incentive equity awards to retain management and focus executives on longer-term financial performance and execution of our operational and strategic plans.

Retirement, severance, and other market-competitive benefits to attract executive talent and encourage retention.

1

This is a reference point, not a policy, and actual compensation may be above or below the target level based on corporate and/or individual performance.

Compensation Components

We base a significant portion of compensation on the achievement of objective financial measures to create a strong link between pay and performance. We have no specific policies on the percentage of total compensation that should be “performance-based,” but consider this relationship in determining the overall balance and reasonableness of the executives’ total direct compensation packages. In 2023, our President & CEO’s total target compensation was 87% performance-based and 13% fixed, and our other named executive officers’ (“NEOs”) total target compensation was 81% performance-based and 19% fixed.

LOGOLOGO

We believe our proportionate mix of compensation opportunities is appropriate in that we provide a slightly greater relative percentage of incentive-based compensation tied to financial performance and long-term objectives to the CEO versus other NEOs because the CEO is able to more directly impact financial results and the creation of long-term shareholder value.

Owens & Minor, Inc.2024 Proxy Statement3


 Proxy Statement Summary 

Compensation Factors and Governance

The Our People & Culture Committee (“OP&C Committee”) applies several corporate governance features related to executive compensation, which are summarized below. We believe that these mechanisms help to assure the alignment of executive and shareholder interests.

 WHAT WE DO

LOGO

Pay for Performance. We link pay to performance and a significant portion of our executives’ potential total annual compensation, both cash and equity, is based on the achievement of objective, simple, and transparent financial measures designed to enhance short- and long-term performance.

LOGO

Performance-Based Equity Awards. At least half of our annual equity award grants are performance share units (“PSUs”) with multi-year performance requirements.

LOGO

Share Ownership Guidelines. We have established stock ownership guidelines for our officers, and our tenured NEOs meet or exceed the established ownership guidelines. Newly appointed NEOs are in the process of attaining the required ownership level.

LOGO

Limited Perquisites. We provide limited perquisites to executive officers.

LOGO

Double-Trigger Change in Control Provisions. Equity vesting and severance benefits resulting from a change in control are “double-trigger” and require a qualifying termination of employment following the change in control.

LOGO

Recoupment Policy. We maintain a recoupment policy to recover all performance-based cash compensation and all equity-based compensation (including both time- and performance-vesting equity awards) paid to current and former executive officers and other senior executives and teammates designated as subject to the policy under circumstances involving restatement of our financial statements.

LOGO

Risk Mitigation. We mitigate risks associated with compensation by establishing caps on incentive compensation, multiple performance targets for incentive compensation, and ongoing processes to identify and manage risk.

LOGO

Independent Compensation Consulting Firm. The OP&C Committee receives advice about its compensation programs and practices from an independent consulting firm that provides no other services to the Company, and the Company is not aware of any conflicts of interest with respect to its work.

 WHAT WE DON’T DO

LOGO

No Employment Agreements. We do not have employment agreements with our executive officers.

LOGO

No Hedging. We prohibit our executive officers and directors from hedging against the economic ownership of Company stock.

LOGO

No Pledging. We prohibit our executive officers from pledging Company stock.

LOGO

No Repricing of Equity Awards. Our stock plans do not permit the repricing of equity awards without shareholder approval.

LOGO

No Tax Gross-Ups. We do not provide excise tax gross-ups.

4Owens & Minor, Inc.2024 Proxy Statement


LOGO

Proxy Statement

Annual Meeting of Shareholders

to be held on May 8, 20189, 2024

ABOUT THE MEETINGAbout the Meeting

When and Where the Annual Meeting Will Be Held

The Annual Meeting will be held virtually on Thursday, May 9, 2024 at 9:00 a.m. EDT at www.meetnow.global/MQUPCLA through a live audio webcast. We have adopted a virtual format for our Annual Meeting which allows us to make participation accessible for shareholders from any geographic location with Internet connectivity, while reducing costs and environmental impact associated with arranging and holding for an in-person meeting.

How to Attend the Virtual Annual Meeting

Shareholders at the close of business on March 14, 2024 (the “Record Date”) have a right to attend the Annual Meeting. In order to be admitted to the Annual Meeting at www.meetnow.global/MQUPCLA, registered shareholders must enter the 15-digit control number found in the shaded bar on your Notice of Internet Availability or proxy card. Further information regarding attending the virtual Annual Meeting can be found at page 77 of this Proxy Statement.

What You Are Voting On

Proxies are being solicited by the Board of Directors for purposes of voting on the following proposals and any other business properly brought before the meeting:

 

Proposal 1:Election of the 10nine directors named in this proxy statement,Proxy Statement, each for aone-year term and until their respective successors are elected and qualified.

Proposal 2:Approval of the Owens & Minor, Inc. 2018 Stock Incentive Plan.

Proposal 3:Ratification of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2018.2024.

Proposal 3:Approval of the amendment to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan.
Proposal 4:Advisory vote to approve the compensation of our named executive officers.officers (the “Say-on-Pay Proposal”).

Who is Entitled to Vote

Shareholders of Owens & Minor, Inc. (the “Company” or “Owens & Minor”) as of the close of business on March 13, 2018 (the “Record Date”)the Record Date are entitled to vote. Each share of the Company’s common stock (“Common Stock”)Stock is entitled to one vote with respect to each matter to be voted upon at the meeting. As of March 13, 2018, 61,822,27714, 2024, 76,598,351 shares of Common Stock were issued and outstanding.

Owens & Minor, Inc.2024 Proxy Statement5


 About the Meeting  

How to Vote

You can vote via the Internet, by telephone or by mail.

By Internet. You may vote via the Internet by following the specific instructions on the Notice of Internet Availability of Proxy Materials. Shareholders who have requested a paper copy of a proxy card by mail may submit proxies over the Internet by following the instructions on the proxy card. We encourage you to vote via the Internet. If your shares are held by your bank or broker in street name, please refer to the instruction form that you receive from your bank or broker or contact your bank or broker to determine whether you will be able to vote via the Internet.

By Telephone. You may vote by telephone by calling the toll-free number on the proxy card and following the instructions. Shareholders will need to have the control number that appears on their proxy card or notice available when voting. If your shares are held by your bank or broker in street name, please refer to the instruction form that you receive from your bank or broker or contact your bank or broker to determine whether you will be able to vote by telephone.

By Mail. Shareholders who have requested a paper copy of a proxy card by mail may submit proxies by completing, signing, and dating the enclosed proxy card and returning it in the postage-paid envelope provided.

However you choose to vote, you may revoke a proxy prior to the meeting by (1) submitting a subsequently dated proxy by any of the methods described above, (2) giving notice in writing to the Corporate Secretary of the Company or (3) voting in person at the virtual meeting (attendance at the meeting will not itself revoke a proxy).

What Happens if You Do Not Make Selections on Your Proxy

If your proxy contains specific voting instructions, those instructions will be followed. However, if you sign and return your proxy card by mail or submit your proxy by telephone or via the Internet without making a selection on one or more proposals, you give authority to the individuals designated on the proxy card to vote on the proposal(s) for which you have not made specific selections or given instructions and any other matter that may arise at the meeting. If no specific selection is made or instructions given, it is intended that all proxies that are signed and returned or submitted via telephone or Internet will be voted “FOR” the election of all nominees for director, “FOR” approval of the 2018 Stock Incentive Plan, “FOR” the ratification of KPMG LLP as our independent registered public accounting firm in 20182024, “FOR” approval of the amendment to the 2023 Omnibus Incentive Plan, and “FOR” the approval on an advisory basis, of the compensation of our named executive officers (together, the “NEOs,” and, individually, an “NEO”).Say-on-Pay Proposal.

Whether Your Shares Will be Voted if You Don’t Provide Your Proxy

Whether your shares will be voted if you do not provide your proxy depends on how your ownership of shares of Common Stock is registered. If you own your shares as a registered holder, which means that your shares of Common Stock are registered in your name, and you do not provide your proxy, your shares will not be represented at the meeting, will not count toward the quorum requirement, which is explained below, and will not be voted.

If you own your shares of Common Stock in street name, your shares may be voted even if you do not provide your broker with voting instructions. Brokers have the authority under New York Stock Exchange (“NYSE”) rules to vote shares for which their beneficial owner customers do not provide voting instructions on certain “routine” matters. When a proposal is not a routine matter and the brokerage firm has not received voting instructions from the beneficial owner of the shares with respect to that proposal, the brokerage firm cannot vote the shares on that proposal. This is called a brokernon-vote.

The Company believes that only the proposal to ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for 20182024 is a routine matter for which brokerage firms will have discretionary voting power if you do not give voting instructions with respect to this proposal. The proposal to elect directors, the proposal to approve the 2018 Stockamendment to the 2023 Omnibus Incentive Plan and the proposal to approve, on an advisory basis, the compensation of our NEOs,Say-on-Pay Proposal arenon-routine matters for which brokerage firms will not have discretionary voting power and for which specific voting instructions from their customers are required. As a result, brokerage firms will not be allowed to vote on thesenon-routine matters on behalf of their customers if the customers do not return specific voting instructions.

6Owens & Minor, Inc.2024 Proxy Statement


 About the Meeting  

What Constitutes a Quorum

A majority of the outstanding shares of Common Stock present or represented by proxy constitutes a quorum. A quorum is required to conduct the annual meeting.Annual Meeting. If you vote your proxy, you will be considered part of the quorum. Abstentions and shares held by brokers or banks in street name (“broker shares”) that are voted on any matter are included in the quorum. Broker shares that are not voted on any matter will not be included in determining whether a quorum is present.

The Vote Required to Approve Each Item

Election of Directors. The affirmative vote of a majority of the votes cast at the meeting is required for the election of each director. A majority of votes cast means that the number of votes cast “FOR” a nominee’s election must exceed the number of votes cast “AGAINST” that nominee’s election. Abstentions and brokernon-votes will not be counted as votes cast and will have no effect on the results of this vote.

Approval of 2018 Stock Incentive Plan.    The approval of the 2018 Stock Incentive Plan requires the affirmative vote of a majority of the votes cast on this proposal. Abstentions will be considered as votes cast under the rules of the NYSE and will have the effect of a vote against this proposal for purposes of the rules of the NYSE. Brokernon-votes will not be counted as votes cast on this proposal and will have no effect on the results of this vote.

Ratification of Appointment of KPMG LLP. The appointment of KPMG LLP will be ratified if the votes cast “FOR” this proposal exceed the number of votes cast “AGAINST” this proposal. Abstentions will not be counted as votes cast on this proposal and will have no effect on the results of this vote. There should be no brokernon-votes because this is considered a routine matter under the rules of the NYSE.

Approval of the Amendment to the 2023 Omnibus Incentive Plan. The approval of the amendment to the 2023 Omnibus Incentive Plan requires the affirmative vote of a majority of the votes cast on this proposal. A majority of votes cast means that the number of votes cast “FOR” this proposal must exceed the number of votes cast “AGAINST” this proposal. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the results of this vote.

Advisory Vote to Approve Executive Compensationthe Say-on-Pay Proposal. The compensation of our executive officers named in the Summary Compensation Table will be approved on an advisory basis if the votes cast “FOR” this proposal exceed the number of votes cast “AGAINST” this proposal. Abstentions and brokernon-votes will not be counted as votes cast on this proposal and will have no effect on the results of this vote.

How to Obtain a Paper Copy of the Proxy Materials

Shareholders will find instructions about how to obtain a paper copy of the proxy materials on the notice they received in the mail about the Internet availability of proxy materials.

What it Means if You Get More Than One Notice about the Internet Availability of Proxy Materials

Your shares are probably registered differently or are held in more than one account. Please vote all proxies to ensure that all your shares are voted. Also, please have all of your accounts registered in the same name and address. You may do this by contacting our transfer agent, Computershare, Inc., at1-866-252-0358.

Costs of Soliciting Proxies

Owens & Minor will pay all costs of this proxy solicitation. The Company has retained Georgeson, LLC to aid in the distribution and solicitation of proxies for approximately $6,000$8,500 plus expenses. The Company will reimburse brokers and other custodians, nominees, and fiduciaries for their expenses in forwarding proxy and solicitation materials.

CORPORATE GOVERNANCE

Owens & Minor, Inc.2024 Proxy Statement7


Corporate Governance

General. The Company is managed under the direction of the Board of Directors (the “Board”), which has adopted Corporate Governance Guidelines to set forth certain corporate governance practices.practices applicable to the Board. Each year, we review our corporate governance policies and practices relative to applicable laws, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the Sarbanes-Oxley Act of 2002, and rules and regulations promulgated thereunder or adopted by the Securities and Exchange Commission (“SEC”(the “SEC”) and the NYSE, the exchange on which the Common Stock is listed, as well as the policies and practices recommended by groups and authorities active in corporate governance.

Corporate Governance Materials. The Company’s Bylaws, Corporate Governance Guidelines, Code of Honor, and the charters of the Audit Committee, the CompensationGovernance & BenefitsNominating Committee (the “Compensation Committee”), and the Governance & NominatingOP&C Committee are available on our website athttp://www.owens-minor.com under “Corporate Governance” in the “Investor Relations” tab. The information available on, or that can be accessed through, our website is not a part of, or incorporated by reference into, this proxy statement.Proxy Statement.

Code of Honor. The Board of Directors has adopted a Code of Honor that is applicable to all employeesteammates of the Company, including the principal executive officer, the principal financial officer and the principal accounting officer, as well as the members of the Board of Directors.Board. We intend towould post any amendments to or waivers from our Code of Honor (to the extent applicable to the Company’s principal executive officer, principal financial officer, principal accounting officer, any other executive officer, or any director) on our website http://www.owens-minor.com under “Corporate Governance” in the “Investor Relations” tab.

Director Independence. The Board of Directors has determined that the following Board members and/or nominees are “independent” within the meaning of the NYSE listing standards and the Company’s Corporate Governance Guidelines: StuartMark A. Beck, Gwendolyn M. Essig, JohnBingham, Kenneth Gardner-Smith, Robert J. Henkel, Rita F. Johnson-Mills, Stephen W. Gerdelman, Barbara B. Hill, Lemuel E. Lewis, Martha H. Marsh, Mark F. McGettrick, Eddie N. Moore, Jr., James E. Rogers, David S. Simmons, Robert C. SleddKlemash, Teresa L. Kline, and Anne Marie Whittemore.Carissa L. Rollins. To assist it in making determinations of independence, the Board has adopted categorical standards which are included in the Company’s Corporate Governance Guidelines available on our website at http://www.owens-minor.com under “Corporate Governance” in the “Investor Relations” tab. The Board has determined that all directors and/or nominees identified as independent in this proxy statementProxy Statement meet these standards.

Structure and Leadership of the Board.Board. The Board of Directors does not have a firm policy with respect to the separation of the offices of ChairmanChair of the Board and the Chief Executive Officer. Instead, the Board believes that it is in the best interests of the Company for the Board to make this determination from time to be madetime taking into account many factors including the make-up of the Board, the performance of the business, the tenure of the CEO, or as part of the succession planning process when it selects a new Chief Executive Officer or when a ChairmanChair ceases his or her service on the Board. At the time of Mr. Phipps’ commencement as Chief Executive Officer of the Company, the Board believed that maintaining anon-executive as Chairman of the Board was in the best interests of the Company because it preserved continuity in the Board’s performance of its duties, assisted in the transition of Mr. Phipps to the Chief Executive Officer position and management of the succession plan and provided a strong source of institutional knowledge and history of operations of the Company. In 2017, thenon-executive Chairman notified the Board that he would retire and not stand forre-election to our Board. In connection therewith, the Board evaluated the separation of the offices of the Chairman and Chief Executive Officer. As part of that evaluation, the Board determined that, based on Mr. Phipps’ then18-plus months of Board service and his performance and leadership as the Chief Executive Officer through a period of strategic transformation and repositioning of the Company, it would be in the best interest of the Company to have Mr. Phipps serve as Chairman.

The Board believes that the combinationseparation of the ChairmanChair and Chief Executive Officer roles also currently serves the best interests of the Company for the following reasons:

this structure results in the most effective leadershipby allowing a non-executive, independent director to helplead the Board discharge its oversight duties during a period of transformation and repositioning of the Company;

thewhile our current Chief Executive Officer is well situated to identifyfocuses on the key risks facing our organizationCompany’s performance, day-to-day operations, customer service, teammate engagement, Company culture, leadership, and the successimplementation of its transformation and repositioning, and ensure that these risks are brought to the attention of the Board; and

having one leader serving as both the Chairman and Chief Executive Officer provides decisive leadership while reducing the likelihood of confusion about leadership roles and duplication of efforts, and allows the Company to speak with a unified voice.

strategic initiatives.

Our Corporate Governance Guidelines also provide for the annual election of ana lead independent lead director by ournon-management directors to, among other things, presideif the Chair is not independent. The lead independent director primarily presides at Board meetings in the absence of the Chairman, presideChair, presides at meetings of the independent directors, serveserves as the principal liaison between the independent directors and the ChairmanChair and Chief Executive Officer, and adviseadvises the ChairmanChair with respect to agendas and information requirements relating to the Board and committee meetings. The Board believes that the lead independent lead director, when the Chair is not independent, enhances communications between Board members (including the Chairman)Chair) and committees as well as the overall functioning of the Board’s leadership.

Majority Vote Requirement for Election of Directors.Directors. The Company’s Bylaws and Corporate Governance Guidelines provide for the election of directors by majority vote in uncontested elections. Under the Company’s Corporate Governance Guidelines, with respect to director nominations, the Board will only nominate those incumbent directors who submit irrevocable resignations effective upon the failure of such director nominee to receive the required vote forre-election and the Board’s acceptance of such resignation. In the event an incumbent director fails to receive a majority of the votes cast, the Governance & Nominating Committee (or such other committee designated by the Board) will make a recommendation to the Board as to whether to accept or reject the resignation. The Board must act on the resignation, taking into accountconsidering the Governance & Nominating Committee’s recommendation, and publicly disclose its decision regarding the resignation, including, if applicable, its rationale for rejecting a resignation, in a press release and an appropriate disclosure with the SEC within 90 days following certification of the election results. The Governance & Nominating Committee in making its recommendation, and the Board in making its decision, may each consider any factors or other information that it considers appropriate and relevant.

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The Board’s Role in Risk Oversight.Oversight. The Board of Directors currently administers its risk oversight function through the full Board and not through a separate risk committee of the Board. However, each of the Audit Committee, the CompensationOP&C Committee and the Governance & Nominating Committee oversees the specific financial, compensation and governance risks, respectively, relating to its functions and responsibilities and reports on these matters to the full Board. The Board performs its risk oversight function through regular reporting by the Board committees as well as the officers and management-level personnel who supervise theday-to-day risk management activities of the Company, including an enterprise risk steering committee comprisedcomposed of senior leaders of the Company.Company and is an element of the Company’s enterprise risk management (“ERM”) program.

Risk AssessmentCybersecurity Risks.The Board recognizes the importance of Compensation Programs.    With respectoversight of cybersecurity and information security risks and at least annually receives a comprehensive presentation and report from management on the state of the Company’s cybersecurity program and systems protection. The presentation and report address topics and updates on all layers of cybersecurity, technology, applications, threat environment, and processes to prevent, detect and respond to threats. Cybersecurity and information security monitoring, mitigation and threat assessment are also part of the Company’s ERM program. Additionally, the Audit Committee monitors our information security programs and receives updates from management quarterly, or more frequently as determined appropriate, on the cybersecurity program and matters related to cybersecurity incidents, as well as one-on-one discussions with the Chief Information Officer and Chief Information Security Officer.

We model our cybersecurity program to align with practices and standards referenced within the National Institute of Standards and Technology cybersecurity framework. Our information security program includes, but is not limited to:

Following the methodology of Identify, Protect, Detect, Respond, and Recover;

Mandatory annual cybersecurity awareness training for all teammates accessing the Company’s network;

Monthly Company-wide phishing prevention and awareness exercises;

Identification and remediation of information security risks and vulnerabilities in our information technology (“IT”) systems, including regular scanning of both internal and externally facing systems and annual third-party penetration testing;

Implementation of security technologies intended to identify and assist in containing and remediating malware risks;

Active monitoring of logs and events for our network perimeter and internal systems;

Due diligence of information security programs for third-party vendors that handle our data;

Partnering with the Cybersecurity and Infrastructure Security Agency (“CISA”)/U.S. Department of Homeland Security/Federal Bureau of Investigation, to leverage their provided sensitive/confidential threat intel and with CISA for weekly vulnerability scans of our key public facing servers;

Maintaining a cyber insurance policy that provides coverage for security breach recovery and response; and

Engagement of third-party consultants to assess the health of our cybersecurity program.

Additional information related to our overall compensationcybersecurity program is contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Environmental, Social and Governance (“ESG”). The Governance & Nominating Committee reviews and has oversight of the Company’s ESG programs Company management reviews our compensation policies and practices each year to determine whether they create risks that are reasonably likely to have a material adverse effectpractices. The Governance & Nominating Committee and full Board regularly receive reports on the Company. As part of this assessment and with assistance and guidance provided by independent compensation consultant Semler Brossy Consulting Group, LLC (“Semler Brossy”), we reviewed the design and featuresprogress of our compensation and benefits programs and policies, potential risks that could be created by these programs and features of our programs and corporate governance policies that help to mitigate risk. Semler Brossy reviewed and discussed the results of the assessment with the Compensation Committee. Based on this review and assessment, we believe that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.ESG programs.

Annual Performance Evaluation.Evaluation.The Board conducts an annual self-evaluation (for the full Board and for each of its committees) to determine whether it and its committees are functioning effectively. The Governance & Nominating Committee receives comments from all directors and reports annually to the Board with an assessment of the Board’s performance. The assessment focuses onexamines the Board’s contribution to the Company and specifically focuses on areas in which the Board or management believes that the Board can improve.

Board Diversity. Consistent with the Company’s Corporate Governance Guidelines, the Governance & Nominating Committee seeks to select directors who reflect a diverse set of skills, technical expertise, educational and professional backgrounds, industry experiences and public service. While the Board has not adopted a formal policy with regard to the

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REPORT OF THE GOVERNANCEconsideration of diversity in identifying director nominees, the Governance & NOMINATING COMMITTEENominating Committee and the Board believe that considering diversity is consistent with the goal of creating a Board that best serves the needs of the Company and the interests of its shareholders, and it is one of the many factors that they consider when identifying individuals for Board membership. The table on page 21 sets forth the diversity, experience, and tenure of our director nominees.

Report of the Governance & Nominating Committee

The Governance & Nominating Committee iswas composed of five directors in 2023, and is currently composed of three directors, all of whom the Board has determined are independent. The Governance & Nominating Committee met four times during 2017.2023. In performing the various duties and responsibilities outlined in its charter, the Governance & Nominating Committee, among other things, received regular reports on the Company’s enterprise quality and regulatory compliance; reviewedESG programs; conducted the performanceannual review of the chief executive officer; reviewed and approved its charter and the Corporate Governance Guidelines; engaged an outside compensation firm to reviewreviewed and assessassessed the Company’s director compensation program relative to comparable peer companies; and implementedled the annual Board and committee assessment process.process; recommended rotation of members for each of the Board’s committees; and reviewed director education for the full Board. During 2017,2023, the Governance & Nominating Committee reviewed and recommended foralong with the full Board approval several changes in the executive management team as presented by the Chief Executive Officer and devoted time to management succession planning, including the review and approval of updates to the CEO emergency replacement plan. In anticipationplan and, in conjunction with the OP&C Committee, reviewed the performance of the retirement of several directors overChief Executive Officer.

THE GOVERNANCE & NOMINATING COMMITTEE
Gwendolyn M. Bingham, Chair
Mark A. Beck
Rita F. Johnson-Mills

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Our Purpose & Vision

In 2019, we introduced our IDEAL values, which represent who we are at our best and have served as touchstones for how we do our work every day. In 2023, we took the next step in the evolution of our corporate culture and introduced our Purpose and Vision. We believe this work is vital to Owens & Minor’s continued growth and that purposeful organizations have a distinct advantage in achieving long term success. Our purpose captures who we are and the scale of our impact. At Owens & Minor, Life Takes Care.

Our mission articulates how we will advance our purpose and calls our teammates to act like owners and pursue a results-driven culture. At Owens & Minor, our vision is to be the unstoppable and dynamic leader that connects patients and providers to trusted healthcare products and solutions.

Our purpose gives us our true north and our vision focuses our efforts and, together, they help Owens & Minor deliver on our mission to empower our customers to advance healthcare.

LOGO

Shareholder Engagement

Our Board of Directors and our leadership value our shareholders’ perspectives. Shareholder engagement is an integral part of the Company’s strategy. To help ensure that we understand and focus on the priorities that matter most to our shareholders, our Board of Directors and senior management proactively conduct investor outreach throughout the year.

We engage with shareholders through various outreach initiatives, including:

Quarterly earnings releases with corresponding conference calls and webcasts;

Regular reports filed with the SEC, including annual and quarterly reports;

Participation in investor conferences and non-deal roadshows;

In-person and virtual meetings with current and prospective investors and research analysts;

Proactive outreach to institutional investors, pension funds and governance professionals; and

Our annual shareholders’ meeting.

In addition to discussing business results and initiatives, strategy, and capital structure, we engage with investors on various other matters essential to our business and the Company, such as governance practices, risk management and ESG. Our senior executives regularly share with our Board the feedback received from our shareholders.

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Specific Ways We Engaged with Shareholders in 2023

We actively engaged with shareholders throughout 2023, but the seminal event was our Investor Day in December that was held live in Boston and broadcast through our corporate website. Seventy-eight unique firms participated in the event either in-person or via webcast. During this event, different members of executive management presented the Company’s strategic vision, operating and growth strategy and multi-year financial targets.

In addition to our Investor Day activity, we remained actively engaged with shareholders and other members of the investment community. We held in-person or telephonic discussions with more than 100 individual firms. Between the individual meetings and our Investor Day, we engaged with current shareholders holding over 50% of our shares. We also continued to meet with prospective shareholders, debtholders and sell-side analysts. Our investment community outreach continues to be in the form of quarterly earnings presentations, attendance at industry conferences, and several years,in-person meetings both at the Committee devoted considerableCompany and at investor locations. We participated in four industry investor conferences in 2023. Presentation materials from our Investor Day, as well as attendance at investor conferences, are available to our shareholders generally through our filings with the SEC or on the “Investors Relations” section of our website at www.investors.owens-minor.com.

Additionally in June 2023, we published our latest annual sustainability report. The 2022 report provides an update on the initiatives we outlined in our past reports and discusses the Company’s ESG focus and contributions. It also provides visibility to our shareholders into the performance metrics and achievements that support the Company’s sustainability focus.

Environmental, Social, and Governance

Introduction.Since our founding in 1882, Owens & Minor has remained committed to our teammates, our customers, and the communities where we do business. As part of this commitment, we recognize the need to identify, prioritize, and manage ESG impacts from our operations.

In 2021, we completed our first ESG materiality assessment to identify and prioritize topics most relevant to our key stakeholders. Using the results of the materiality assessment, we developed a framework to align ESG risks and opportunities with our overall business strategy while striving to improve our ESG-related impacts. To effectively manage the implementation of our strategy, we created a governance structure to define our ESG framework and deliver on our commitments. Since its inception, our ESG governance framework has grown to include our expanded Patient Direct offerings and ensure representation across Owens & Minor.

Owens & Minor’s ESG Framework. Our ESG Framework forms the basis of our ESG program, integrating the priorities identified in our materiality assessment into key aspects of our operations and overall business strategy.

Guided by our Purpose, Life Takes Care, our ESG Frameworkemphasizes the importance of incorporating ESG commitments into our company culture and IDEAL (Integrity, Development, Excellence, Accountability, Listening) Values. Our framework consists of four focus areas:

Promoting Environmental Stewardship: Minimize the impact of our operations on the environment.

Caring for our Customers and Communities: Deliver superior and easily accessible care for customers and the communities we support.

Operating Responsibly: Demonstrate sound governance, accountability and responsible sourcing.

Empowering our Teammates: Foster an empowering, safe, diverse and inclusive work environment where all teammates can thrive.

Promoting Environmental Stewardship

Minimizing Physical Climate Risk.Owens & Minor is dedicated to serving our customers and communities, while also protecting teammate safety, during times of emergency and natural disasters to ensure the reliability of product supply and patient care. Honoring our commitment to the Health Sector Climate Pledge developed by The White House and U.S. Department of Health and Human Services, and to further strengthen the integrity of our supply chain in the event of

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future climate impacts, Owens & Minor released a Climate Resilience Plan for Continuous Operations. This Plan outlines our strategies to ensure the continuity of our operations despite the unique challenges presented by climate change. Owens & Minor continues to adapt our infrastructure and operations to address the unique challenges presented by climate change through:

Prospective risk assessments;

Community engagement and partnership;

Assessing the strength of our infrastructure and operations;

Industry and healthcare organization collaboration; and

Interdisciplinary planning, oversight, and evaluation.

To increase the transparency of our environmental footprint Owens & Minor released its inaugural disclosure to the CDP (formerly the Carbon Disclosure Project) in 2023, providing further detail on greenhouse gas (“GHG”) emissions related to operations and the programs in place to address those emissions.

Managing Carbon Footprint: Sites & Fleet Efficiency. At our manufacturing sites, we have adopted practices to reduce our environmental impact, including efforts to eliminate waste, reduce our carbon footprint, and increase renewable energy usage. Additionally, we measure GHG emissions, water usage, and waste to set and implement site-specific goals intended to reduce our environmental footprint. Our Emissions Reduction Working Group has made significant progress in expanding data capture associated with energy consumption and GHG emissions from our manufacturing operations and identifying key opportunities to focus emissions reduction efforts.

Our transportation team remains committed to the fleet efficiency targets set for our strategic logistics partners and continues to share fuel efficiency and freight routing information with the U.S. Environmental Protection Agency (“EPA”) SmartWay program to develop more environmentally friendly shipping methods. Our transportation team works closely with freight partners to identify the most efficient routes available. Our ocean freight partners have invested in upgrading their vessels to improve fuel efficiency and have plans in place to meet carbon emissions reduction targets. We continuously work towards reducing our carbon footprint by prioritizing sea and rail routes when practicable.

In 2023, our Patient Direct segment launched a successful pilot program of electric vehicles supporting our fleet in Southern California. Lessons learned from this pilot informed the addition of 24 electric vehicles to contribute to efficiency improvements and reductions in the carbon emissions associated with bringing essential medical supplies to our customers. Additionally, a program targeting reduced vehicle idle time yielded such strong results – cutting idle time nearly in half for participating vehicles – that the program will be rolled out to all Apria branches in 2024. Owens & Minor continues to evaluate freight strategies, optimize transportation modes and delivery routes, and update and upgrade equipment to further our organization’s climate risk mitigation objectives.

Waste & Water Management. Our facilities continue to focus on mitigating the impact of waste generated by production and operations at our sites. Our commitment to protecting the environment is demonstrated in the following areas:

Sustaining largely landfill-free operations across our manufacturing sites;

Implementing and maintaining recycling programs at our distribution centers and manufacturing sites;

Focusing on the impact of downstream waste by converting more packaging to Forest Stewardship Council (“FSC”)-certified materials;

Increasing consumer awareness of our product takeback and repair programs; and

Working to enhance the recyclability of our distributed products and packaging materials.

Our Packaging & Labelling Working Group identified opportunities to remove unnecessary components from various packaging configurations across several product lines to reduce the impact of downstream waste. The team created an updated informational packaging design to improve the handling and reprocessing of packaging materials manufactured through our operations. Our SAFESKIN* Glove Manufacturing Facility has been consistently recognized for environmental best practices, receiving awards for river conservation, fish release programs, and tree planting to prevent soil erosion.

Caring for Our Customers and Communities

Product Quality and Safety.Quality is the foundation for everything we do at Owens & Minor. The Quality Assurance and Regulatory Affairs (“QARA”) Team effectively manages a robust Quality System that meets or exceeds all laws, regulations,

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and standards that govern our business. This system serves as a framework to support consistent, high-quality solutions for both internal and external customers. Owens & Minor complies with the U.S. Food & Drug Administration (“FDA”) and European Union Medical Device Regulation and is also certified under the International Organization for Standardization (“ISO”) 13485 and the Medical Device Single Audit Program. In 2023, our QARA team:

Enhanced the medical device reporting program;

Established a design control program for our kitting business;

Obtained successful FDA 510k clearances for new product codes; and

Upgraded the electronic Quality Management Systems to support the Owens & Minor Quality System program.

We manage our internal quality system audits as required by the FDA and ISO, as well as through third-party audits.

The Patient Direct segment holds Centers of Medicare & Medicaid Services Durable Medical Equipment, Prosthetics, Orthotics, and Supplies approved third-party accreditation from the Community Health Accreditation Program; The Joint Commission; Healthcare Quality Association on Accreditation; and Utilization Review Accreditation Commission, as applicable to business operations. These organizations continuously collect safety and key performance indicators to monitor compliance with their requirements. Additionally, client and referral satisfaction is surveyed and reported for evaluation by leadership.

Supporting Our Communities.We invest in the communities where we operate through charitable contributions from The Owens & Minor Foundation (the “Foundation”) and by encouraging our teammates’ volunteerism. Launched in May 2021 with a $10 million endowment, the Foundation is dedicated to making impactful investments to charitable and civic organizations in the communities we serve and focuses primarily in three areas: Environment, with particular attention to director succession planning, including the stewardship of waterways; Healthcare; and Diversity, Equity & Inclusion. Since its inception, the Foundation has contributed more than $2 million to organizations supporting our three focus areas.

In 2021, The Owens & Minor Foundation selected Ronald McDonald House Charities® (“RMHC”) as its flagship charity partner, donating Halyard® products and contributing more than $1 million for multi-year support of RMHC programming that directly improves the health and well-being of children and their families. In 2023, The Foundation’s contribution guaranteed 5,000 overnight stays to ensure families with ill or injured children remained together and close to medical care. In addition, Owens & Minor teammates volunteered nearly 2,000 hours to help feed and nourish RMHC families.

Also in 2023, the Foundation collaborated with our Veterans Teammate Resource Group (“Veterans TRG”) to partner with Hope for the Warriors® to help support active U.S. servicemembers, veterans, and military families, as well as to provide ongoing engagement opportunities for Owens & Minor teammates. The Owens & Minor Veterans TRG provides a forum for active and former U.S. military servicemembers to advocate for veterans and veterans’ causes on behalf of teammates and in local communities. The Foundation’s support will assist more than a thousand Hope for the Warriors clients across a variety of programs.

Further, the Foundation continued engagementits commitment to environmental charities nationwide with contributions to Chattahoochee Riverkeeper, The Conservation Foundation, FRIENDS of Great Salt Lake, Los Angeles Waterkeepers, and Save the Sound to increase access, education and conservation of the nation’s waterways. In summary, these and other contributions continue Owens & Minor’s longstanding legacy of service to our teammates, customers, and the communities in which we operate.

Operating Responsibly

Regulatory Compliance. We are committed to conducting business in compliance with applicable environmental laws and regulations as well as through environmentally responsible practices. Owens & Minor complies with relevant regulatory standards for air emissions, stormwater, and pollution prevention under the U.S. EPA and other global authorities applicable to where we operate. We also develop and maintain environmental objectives that focus on reducing our impact across our manufacturing sites and vehicle fleets.

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Governance & Transparency. As part of our comprehensive Ethics and Compliance Program that aligns with the fundamental elements of an outside consulting firmeffective compliance program, as outlined by the U.S. Government and healthcare industry best practices, we maintain a Code of Honor. This Code creates a standard for ethical behavior that is required of all our teammates and business partners, including expectations for specific topics such as anti-bribery and anti-corruption. Annually, we require all teammates and our Board of Directors to assistpledge to uphold the Code’s standards.

We monitor corruption and bribery through our corporate internal audit, procurement, compliance, and vendor relations teams, who review various reports from all areas of our business. Owens & Minor prohibits all forms of bribery and corruption and maintains policies and procedures to prevent unethical business practices. Our internal audit, procurement, and vendor relations teams hold various compliance trainings to maintain compliance with all laws and regulations. We also maintain a whistleblower hotline for teammates to report any compliance concerns.

Ethical Supply Chain. The company’s social compliance programs strive to uphold human rights in all our business activities. Owens & Minor supports these programs with elements including, but not limited to:

Oversight from our Board and Executive Leadership Team, as well as our Human Resources, Legal, Ethics & Compliance, Privacy, and Supply Chain leadership;

Risk analysis;

Policies and procedures;

Training and communication;

Auditing and monitoring;

Whistleblower hotline;

Anti-bribery and anti-corruption standards;

Modern slavery assessments and safeguards – Including all forms of involuntary labor, trafficked labor, forced labor, and child labor; and

Environmental protections.

We also work to ensure that both Owens & Minor and our vendors adhere to business integrity fundamentals including, but not limited to:

Privacy laws and regulations;

Healthcare law;

Import/export compliance;

Security, both physical and cyber;

Conflict minerals policies;

Antitrust;

Industry standards; and

Transparency.

Advancing Supplier Diversity. We support a socially responsible supply chain that includes qualified businesses with women-owned, minority, LGBTQ+, disabled, and veteran representation. In addition to our Supplier Diversity Council, Owens & Minor has expanded its program to include Tier 1 and Tier 2 diversity mentoring, adding dedicated leadership for diversity programs, and implementing private label products to be utilized by diverse suppliers. To continue building on our Supplier Diversity Program, in 2023 Owens & Minor established a commercial marketing strategy to optimize supplier diversity. To support and better understand supplier performance, Owens & Minor centralized reporting, increased the visibility of products from our partner diverse suppliers, and tracked the associated usage so that we may better identify opportunities to continue to grow and expand the program.

Empowering Our Teammates

In alignment with our IDEAL Values, Owens & Minor strives to empower our teammates by ensuring there are open channels of communication across all levels of the organization. Our teammates are supported with development programs

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and a healthy work environment, and we aim to realize success together through diversity, equity, and inclusion (“DE&I”). In 2023, we held regular virtual Town Hall meetings with our Executive Leadership Team and global teammates and encouraged all managers to align action plans across their teams with survey responses. We provided Learning Pathways designed to support teammates in developing skills for their role and planning their career paths. Through our annual talent review, we continue to invest in leadership development opportunities to increase the readiness of top talent leaders to assume greater responsibility at Owens & Minor. We also bolstered our support for DE&I by continuing to grow our TRGs to provide support and help in personal and career development while creating a safe space where teammates can bring their authentic selves to work every day. In 2023, we launched the Diverse Abilities Inclusion & Support (“DAIS”) TRG for all teammates with diverse abilities, caring for a family member with diverse abilities, or wishing to join as an ally. This TRG advances awareness and inclusion while promoting an environment where teammates feel comfortable sharing, feel they are heard, and are encouraged to utilize resources available through our company and their communities. Our goal is to provide education and support while promoting inclusion and understanding of teammates with diverse abilities.

Supporting Our Teammates.The health, wellness and safety of our teammates is a foundational priority at Owens & Minor. We take care of our teammates, and our teammates take care of our customers. We value the contributions teammates make toward growing Owens & Minor and offer a comprehensive suite of benefits and well-being resources such as health and financial wellness programs, adoption assistance, parental leave, education assistance, and bereavement leave.

Teammate safety is a priority at Owens & Minor, and we pursue a “safety as a lifestyle” approach, which was demonstrated in 2023, as we achieved a total-company recordable incident rate of 1.02—lower than the average of 2.7 for private industry. Additionally, we achieved a DART rate (cases with Days Away, Restricted, or Transfer of Duty) of 0.61, also lower than the private industry average of 1.7. Several of our sites routinely work millions of hours without a recordable injury, reflecting our commitment to safety and overall target of zero injuries. During 2023, we achieved several Environment, Health, and Safety milestones including, but not limited to:

27 of our manufacturing plants and distribution centers worked the entire year free of recordable injuries.

75% of our Patient Direct locations worked the entire year free of recordable incidents.

We hosted a “Spring into Safety” housekeeping challenge in March to focus on the fundamentals for our safe workplace.

Our facility in Kells, Ireland hosted a Wellness Week in December educating and refreshing our teammates on self-care, winter safety, and Supervisor training/preparedness.

We hosted Global Safety Week in August, involving all Products & Healthcare Services, (e.g., manufacturing, distribution), Patient Direct and Corporate Functions in a coordinated, structured week to celebrate the safety of our teammates and educate them for continued well-being. This special week also included a global competition encouraging sites to get creative and showcase teammate’s engagement activities.

Overall, we seek to strengthen and continuously improve all of our Environment, Health, and Safety program initiatives with the goal of providing an optimal environment to achieve our Purpose and Vision.

Promoting Diversity, Equity, and Inclusion.Promoting DE&I is not a project nor a point-in-time discussion. Building a diverse, equitable, and inclusive workplace takes dedication and a long-term commitment from each one of us to live our IDEAL Values and to bring our authentic selves to work each day.

We encourage a working environment that promotes the success and well-being of all our teammates. We advocate for DE&I across our business to help succeed in delivering our DE&I strategy. Reflecting our commitment to and support for DE&I, we launched Unconscious Bias training for all senior leaders in 2023, and we will continue educating at deeper levels of the organization in 2024.

Our TRGs were created in 2020 to promote engagement and support for underrepresented identity groups, including African American/Black, Veteran and Military, LGBTQ+, Women’s Empowerment Network, Hispanic, Asian American/Pacific Islanders, and Women in Technology. With the addition of our eighth TRG in 2023 centered on teammates with or who care for family members with Diverse Abilities, we have more than 1,000 members and allies participating in TRGs throughout the company. A new TRG has been approved for Q1 2024 focusing on emerging and future leaders within the company. To further advance our Purpose of Life Takes Care, each TRG received funding in 2023 from the Foundation to support

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nonprofit organizations nominated by each TRG that align with that specific TRG’s mission and goals. These contributions allowed our TRGs to develop partnerships by participating in engagement events and volunteer opportunities in the identificationdiverse communities where we live and strategic recruitment of directors possessing the qualities, character, experience and expertise that will contribute to the leadership and success of the Company in the rapidly changing healthcare industry.work.

THE GOVERNANCE & NOMINATING

COMMITTEE

Martha H. Marsh, Chairman

Stuart M. Essig

Lemuel E. Lewis

Eddie N. Moore, Jr.

James E. Rogers

BOARD MEETINGSBoard Meetings

The Board of Directors held 1516 meetings during 2017.2023 which included regular meetings and special meetings to provide oversight related to, among other things, the Company’s strategic planning, certain executive management changes and navigating macro-economic conditions during 2023. All directors attended at least 75% of the meetings of the Board and committees on which they served. Our directors attend our annual meetingAnnual Meeting of shareholdersShareholders unless there is compelling reason why they cannot. All of our directors with the exception of Mr. Moore,in office at that time attended our 20172023 Annual Meeting of Shareholders.

UnderCommittees of the Company’s Corporate Governance Guidelines, the independent directors meet in executive session after each regularly scheduled Board meeting. These meetings are chaired by our lead director who is elected annually by thenon-management directors following each annual meeting of shareholders. Anne Marie Whittemore currently serves as lead director and presides over these executive sessions. As lead director, Ms. Whittemore is also invited to participate in meetings of all Board committees but is permitted to vote only in meetings of committees of which she is a member. Shareholders and other interested parties may contact the lead director by following the procedures set forth in “Communications with the Board of Directors” on page 11 of this proxy statement.

COMMITTEES OF THE BOARD

The Board of Directors currently has the following committees, which the Board established to assist it with its responsibilities:

Audit Committee:Oversees (i) the integrity of the Company’s financial statements, (ii) the Company’s compliance with legal and regulatory requirements, (iii) the qualification and independence of the Company’s independent registered public accounting firm, (iv) the performance of the Company’s independent registered public accounting firm and internal audit functions and (v) issues involving the Company’s ethical and legal compliance responsibilities. Committee.The Audit Committee oversees:

Integrity of the Company’s financial statements;

The Company’s compliance with legal and regulatory requirements;

Qualification and independence of the Company’s independent registered public accounting firm;

Performance of the Company’s independent registered public accounting firm and internal audit functions;

Certain aspects of the Company’s ERM program, including cybersecurity risk; and

Issues involving the Company’s ethical and legal compliance responsibilities.

The Audit Committee has sole authority to appoint, retain, compensate, evaluate, and terminate the Company’s independent registered public accounting firm. The Board of Directors has determined that each of Lemuel E. Lewis and Eddie N. Moore, Jr.Committee Chair, Stephen Klemash, is an “audit committee financial expert,” as defined by SEC regulations and that each member of the Audit Committee is financially literate under NYSE listing standards. All members of the Audit Committee are independent as such term is defined under the enhanced independence standards for audit committees in the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules thereunder as incorporated into the NYSE listing standards and under the Company’s Corporate Governance Guidelines. The Audit Committee met six times during 2023.

CompensationOur People & BenefitsCulture Committee. The OP&C Committee:Administers executive compensation programs, policies and practices. Advises the Board on salaries and compensation of the executive officers and makes other studies and recommendations concerning compensation and compensation policies. May delegate authority forday-to-day administration and interpretation of compensation plans to certain senior officers of the Company (other than for matters affecting executive officer compensation and benefits). For further information on this committee’s processes and procedures, see “Compensation Discussion and Analysis” on page 33 of this proxy statement.

Administers executive compensation programs, policies and practices;

Advises the Board on salaries and compensation of the executive officers;

Conducts studies and recommendations concerning compensation and compensation policies;

May delegate authority for day-to-day administration and interpretation of compensation plans to certain senior officers of the Company (other than for matters affecting executive officer compensation and benefits); and

Exercises oversight over other matters affecting our culture and our teammates such as DE&I, teammate satisfaction, teammate health and well-being, job satisfaction and turnover.

All members of the CompensationOP&C Committee are independent within the meaning of the enhanced NYSE listing standards and the Company’s Corporate Governance Guidelines.Guidelines and are “non-employee directors” as defined in Rule 16b-3 under the Exchange Act. The CompensationOP&C Committee met 6eight times during 2017.2023.

Governance & Nominating Committee:Considers and recommends nominees for election as directors and officers and nominees for each Board committee. Reviews and recommends changes to director compensation. Reviews and evaluates the procedures, practices and policies of the Board and its members and leads the Board in its annual self-review. Oversees the governance of the Company, including reviewing and recommending changes to the CorporateCommittee. The Governance Guidelines. Conducts succession planning for senior management. & Nominating Committee:

Considers and recommends nominees for election as directors and officers and nominees for each Board committee;

Reviews and recommends changes to director compensation;

Owens & Minor, Inc.2024 Proxy Statement17


 Corporate Governance 

Reviews and evaluates the procedures, practices and policies of the Board and its members and leads the Board in its annual self-review;

Oversees the governance of the Company, including reviewing and recommending changes to the Corporate Governance Guidelines;

Conducts succession planning for senior management; and

Reviews the Company’s ESG programs and practices.

All members of the Governance & Nominating Committee are independent within the meaning of the NYSE listing standards and the Company’s Corporate Governance Guidelines. The Governance & Nominating Committee met four times during 2023.

Executive Committee:Committee.Exercises limited powers of the Board when the Board is not in session. The Executive Committee did not meet during 2017.

2023.

Board Committee Membership

BOARD COMMITTEE MEMBERSHIPThe Board, upon recommendation from the Governance & Nominating Committee, reviews and determines the composition of the Committees, appoints the Committee Chairs, and considers periodic rotation of committee members and chairs, taking into account the benefits of continuity and depth of experience, professional background, and experience with understanding different aspects of our business. In January 2024, the Board rotated the members of the Governance & Nominating and OP&C Committees.

 

Director Board  Audit 

 Compensation & 

Benefits

 Executive Governance  &
Nominating

P. Cody Phipps*

X*X*

Stuart M. Essig

XX

John W. Gerdelman

XX

Barbara B. Hill

XX

Lemuel E. Lewis

XX*XX

Martha H. Marsh

XXXX*

Mark F. McGettrick**

X

Eddie N. Moore, Jr.

XXX

James E. Rogers***

XXX

David S. Simmons***

XX

Robert C. Sledd

XXX*X

Anne Marie Whittemore

XX

No. of meetings in 2017

157604
      

Director

   Board     Audit     Executive   

 Governance & 

 Nominating 

 

 Our People 

 & Culture 

     

Mark A. Beck

 

C

 

 

 

C

 

 

     

Gwendolyn M. Bingham

 

 

 

 

 

C

 

 

     

Kenneth Gardner-Smith

 

 

 

 

 

 

 

 

     

Robert J. Henkel

 

 

 

 

 

 

 

C

     

Rita F. Johnson-Mills

 

 

 

 

 

 

 

 

     

Stephen W. Klemash**

 

 

C

 

 

 

 

 

     

Teresa L. Kline

 

 

 

 

 

 

 

 

     

Edward A. Pesicka*

 

 

 

 

 

 

 

 

     

Carissa L. Rollins

 

 

 

 

 

 

 

 

     

No. of Meetings in 2023

 

16

 

6

 

0

 

4

 

8

C Chair   Member  *ChairmanNon-Independent Director  ** Financial Expert

**Mr. McGettrick was appointed to the Board on March 1, 2018.

***Mr. Rogers and Mr. Simmons have notified the Board of Directors that they are not standing forre-election at the annual meeting.

DIRECTOR COMPENSATIONDirector Compensation

The Governance & Nominating Committee reviews director compensation annually, and it is the responsibility of this committee to recommend to the Board of Directors any changes in director compensation. The Board of Directors makes the final determination with respect to director compensation. The Governance & Nominating Committee has the authority under its charter to retain outside consultants or advisors to assist it in gathering information and making decisions.

The Company uses a combination of cash and equity compensation to attract and retain qualified candidates to serve on its Board of Directors. In setting director compensation, the Company considers the time commitment of timethat directors must make in performing their duties, the level of skills required by the Company of its Board members and the market competitiveness of its director compensation levels. Additionally, from time to time, the Company performs a market review with respect to other leading companies of similar size to the Company and with respect to the Company’s peer group, under the supervision of the Governance & Nominating Committee, and upon recommendation of the Company’s independent compensation consultant, to determine the compensation arrangements for the independent directors of the

18Owens & Minor, Inc.2024 Proxy Statement


 Corporate Governance 

Company. The table below sets forth the schedule of fees paid tonon-employee directors for their annual retainer and service in various capacities on Board committees and in Board leadership roles. Employee directors do not receive any additional compensation for serving on the Board or any of its committees.

Schedule of Director Fees

 

Type of Fee Cash  Equity 

Annual Retainer

 $35,000  $100,000(1) 

Additional Annual Retainer for Lead Director

  35,000   N/A

Additional Annual Retainer for Audit Committee Chair

  10,000   N/A

Additional Annual Retainer for Compensation Committee Chair

  10,000   N/A

Additional Annual Retainer for Governance & Nominating Committee Chair

  9,000   N/A

Additional Annual Retainer for Other Committee Chairs

  8,000   N/A

Board or Audit Committee Attendance Fee (per meeting)

  2,000   N/A

Compensation Committee Attendance Fee (per meeting)

  1,800   N/A

Other Committee Attendance Fee (per meeting)

  1,500   N/A

Board or Committee Telephone Conference Attendance Fee (per meeting, other than Audit Committee)

  1,000   N/A

Audit Committee Telephone Conference Attendance Fee (per meeting)

  1,200   N/A

Board Strategy Retreat Attendance Fee (annual2-day meeting)

  3,000   N/A
   

Type of Fee

 Cash  Equity 
  

Annual Retainer

 

$

125,000

 

 

$

175,000

(1) 

  

Additional Annual Retainer for Independent Board Chair

 

 

110,000

 

 

 

N/A

 

  

Additional Annual Retainer for Audit Committee Chair

 

 

30,000

 

 

 

N/A

 

  

Additional Annual Retainer for OP&C Committee Chair

 

 

25,000

 

 

 

N/A

 

  

Additional Annual Retainer for Governance & Nominating Committee Chair

 

 

25,000

 

 

 

N/A

 

(1) Restricted stock grant withone-year vesting period.

(1)

Restricted stock grant with one-year vesting period.

Directors may defer the receipt of all or part of their director fees under the Directors’ Deferred Compensation Plan. Amounts deferred are “invested” in bookkeeping accounts that measure earnings and losses based on the performance of a particular investment. Directors may elect to defer their fees into the following two subaccounts: (i) an account based upon the price of the Common Stock and (ii) an account based upon the current interest rate of the Company’s fixed income fund in its 401(k) plan.Retirement and Savings Plan (the “401(k) Plan”). Subject to certain restrictions, a director may take cash distributions from a deferred fee account either prior to or following the termination of his or her service as a director.

2023 Director Compensation Table

The table below summarizes the actual compensation paid by the Company tonon-employee directors who served during the year ended December 31, 2017.2023. Mr. Pesicka’s compensation is shown in the table entitled “2023 Summary Compensation Table”.

 

(a)(b)(c)(d)(e)(f)(g)(h)
Name

Fees Earned
or Paid

in Cash

($) (1)

Stock
Awards
($) (1)(2)(4)
Option
Awards
($) (3)

Non-Equity
Incentive Plan
Compensation

($)

Change in
Pension Value
and
Nonqualified
Deferred

Compensation

Earnings

($)

All Other
Compensation
($)

Total

($)

Stuart M. Essig

 64,900 100,000 —   —   —   —   164,900

John W. Gerdelman

 70,400 100,000 —   —   —   —   170,400

Barbara B. Hill

 72,150 125,000 —   —   —   —   197,150

Lemuel E. Lewis

 87,400 100,000 —   —   —   —   187,400

Martha H. Marsh

 84,000 100,000 —   —   —   —   184,000

Mark F. McGettrick (5)

 N/A N/A N/A N/A N/A N/A N/A

Eddie N. Moore, Jr.

 76,400 100,000 —   —   —   —   176,400

James E. Rogers

 75,000 100,000 —   —   —   —   175,000

David S. Simmons

 65,200 100,000 —   —   —   —   165,200

Robert C. Sledd

 89,000 100,000 —   —   —   —   189,000

Craig R. Smith

 44,500 N/A —   —   —   —   44,500

Anne Marie Whittemore

 94,000 100,000 —   —   —   —   194,000
   

Name

 

 Fees Earned 
or Paid
in Cash

($)

  

Stock

 Awards 

($)(1)(2)(3)

  

 Total 

($)

 
   

Mark A. Beck

 

 

235,000

 

 

 

175,000

 

 

 

410,000 

   

Gwendolyn M. Bingham

 

 

150,000

 

 

 

175,000

 

 

 

325,000 

   

Kenneth Gardner-Smith

 

 

125,000

 

 

 

175,000

 

 

 

300,000 

   

Robert J. Henkel

 

 

150,000

 

 

 

175,000

 

 

 

325,000 

   

Rita F. Johnson-Mills

 

 

125,000

 

 

 

175,000

 

 

 

300,000 

   

Stephen W. Klemash

 

 

155,000

 

 

 

175,000

 

 

 

330,000 

   

Teresa L. Kline

 

 

125,000

 

 

 

175,000

 

 

 

300,000 

   

Carissa L. Rollins

 

 

125,000

 

 

 

175,000

 

 

 

300,000 

(1)

(1)

Includes amounts deferred by the directors under the Directors’ Deferred Compensation Plan.

(2)

The amounts included in the “Stock Awards” column are the aggregate grant date fair value of the awards computed in accordance with the FASB ASC Topic 718. Assumptions used in the calculation of the stock awards are included in note 10 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which is incorporated herein by reference. The actual value a director may receive for Stock Awards depends on market prices, and there can be no assurance that the amounts shown are the amounts that will be realized.

(3)

The Stock Award amount of $175,000 equated to 9,344 shares of restricted stock based on the closing stock price of $18.73 on May 12, 2023, the date of grant. These shares vest on May 12, 2024.

(2) The amounts included in the “Stock Awards” column are the aggregate grant date fair value of the awards computed in accordance with the FASB ASC Topic 718.Owens & Minor, Inc.2024 Proxy Statement19


 Corporate Governance 

(3) Option Awards were not granted to Directors in 2017.

(4) The Stock Award amount of $100,000 equated to 3,050 shares of Restricted Stock based on the closing stock price of $32.79 on May 5, 2017, the date of grant. These shares vest on May 5, 2018. Upon her appointment to the Board on February 9, 2017, Ms. Hill received a Stock Award in the amount of $25,000 which equated to 696 shares of Restricted Stock based on the closing price of $35.91 on that date. These shares vested on February 9, 2018. Mr. Smith did not receive a Stock Award during 2017.

(5) Mr. McGettrick was appointed to the Board on March 1, 2018 and therefore did not receive compensation during the year ended December 31, 2017.

Stock Ownership Guidelines for Directors

The Company maintains stock ownership guidelines for its directors whichand modified those guidelines in 2021 to provide that each director shall attain, within five years after his or her service on the Board begins (or by July 30, 2026 for directors serving as of July 30, 2021), a level of equity ownership of Common Stock having a value of at least fivefour times the director’s annual cash retainer. Currently, the annual cash retainer fee or $150,000, whichever is higher. Each director who has served on$125,000 and the Board for at least five years has achieved thisequity ownership objective.guideline value is $500,000.

DIRECTOR NOMINATING PROCESSDirector Nominating Process

Director Candidate Recommendations and Nominations by Shareholders. The Governance & Nominating Committee charter provides that the Governance & Nominating Committee will consider director candidate recommendations by shareholders. Shareholders should submit any such recommendations to the Governance & Nominating Committee through the method described under “Communications with the Board of Directors” below. In addition, our Bylaws provide that any shareholder of record entitled to vote for the election of directors at the applicable meeting of shareholders may nominate directors by complying with the notice procedures and requirements set forth in the Bylaws and summarized inBylaws. For more information, see “Shareholder Proposals” on page 6721 of this proxy statement.Proxy Statement.

Process for Identifying and Evaluating Director Candidates.Candidates. The Governance & Nominating Committee evaluates all director candidates in accordance with the director qualification standards and the criteria described in our Corporate Governance Guidelines. These guidelines require the Governance & Nominating Committee on an annual basis to review and evaluate the requisite skills and characteristics of individual Board members and nominees as well as the composition of the Board as a whole. This assessment includes whether the member or candidate is independent and includes considerations of diversity, age, skills, and experience in the context of the Board’s needs. The goal of the Governance & Nominating Committee is to have a Board whose membership reflects a mix of diverse skill sets, technical expertise, educational and professional backgrounds, industry experiences and public service as well as perspectives of different genders and ethnicities. The Governance & Nominating Committee reviews its annual assessment with the Board each year and, as new member candidates are sought, attempts to maintain, and enhance the level of diverse backgrounds and viewpoints of directors constitutingcomposing the Board. As part of the Board’s annual self-assessment process, the Board will consider the effectiveness of its overall composition and structure as well as its performance and functioning.

There are no differences in the manner in whichway the Governance & Nominating Committee evaluates director candidates based on whether the candidate is recommended by a shareholder.shareholder or was identified by other means. The Governance & Nominating Committee did not receive any nominations from any shareholders for the 20182024 Annual Meeting.

Our Bylaws provide that no director nominee can stand for election if, at the time of appointment or election, the nominee is over the age of 72; however, under exceptional circumstances, the Board may waive on a temporary basis the director age limitations to allow a director to be appointed, elected, and serve past age 72.

COMMUNICATIONS WITH THE BOARD OF DIRECTORSCommunications with the Board of Directors

The Board of Directors has approved a process for shareholders and other interested parties to send communications to the Board. Shareholders and other interested parties can send written communications to the Board, any committee of the Board,non-management directors as a group, the Chair, the lead director or any other individual director atby one of the following address:means: (1) postal mail to P.O. Box 2076, Mechanicsville,27626, Richmond, VA 23116-2076.23261-7626, or (2) on our website at http://www.owens-minor.com under “Corporate Governance” in the “Investor Relations” tab. All communications will be relayed directly to the applicable director(s).

20Owens & Minor, Inc.2024 Proxy Statement


Proposal 1: Election of Directors

PROPOSAL 1: ELECTION OF DIRECTORS

TenNine directors have been nominated for election to the Board of Directors for aone-year term expiring at the 20192025 Annual Meeting of Shareholders or until their respective successors are elected. Each nominee has agreed to serve if elected and qualified. If any nominee is not able to serve, the Board may designate a substitute or reduce the number of directors serving on the Board. Proxies will be voted for the nominees shown below (or if not able to serve, such substitutes as may be designated by the Board). The Board has no reason to believe that any of the nominees will be unable to serve.

Our Bylaws currently provide that the number of directors constituting the Board of Directors consistsshall from time to time be set by resolution adopted by the affirmative vote of 12 directors anda majority of the Directors in office. In accordance with the Bylaws, the Board has approved an amendment to our Bylaws to decrease the number of directors to 10 effective upon Messrs. Rogers and Simmons’ retirement fromthat the Board effective upon the 2018 Annual Meeting.of Directors would consist of nine directors. The Governance & Nominating Committee has recommended to the Board of Directors, and the Board of Directors has approved, 10nine persons as nominees for election to the Board of Directors. Proxies cannot be voted for a greater number of directors than the number of nominees named.

Information on each nominee, including the particular experience, qualifications, attributes and/or skills that led the Board to conclude that he or she should serve as a director of the Company, is set forth below.below in the following tables and in nominee specific disclosures.

NOMINEES FOR ELECTION

Experience & Skills of

Director Nominees

 LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

Significant Leadership Experience

 

 

 

 

 

 

 

 

 

          

Healthcare Experience

 

  

 

 

 

 

 

 

          

Manufacturing/ Operations Experience

 

 

 

   

  

 

          

Global, Emerging Markets Experience

 

 

   

 

  

 

          

Supply Chain & Logistics Experience

 

 

  

  

  

 

          

Technology, Cybersecurity or IT Oversight

 

 

 

 

 

 

 

 

 

          

Financial Literacy & Reporting

 

 

 

 

 

 

 

 

 

          

Risk Oversight/ Risk Management

 

 

 

 

 

 

 

 

 

          

Public Company Governance

 

 

 

 

 

 

 

 

 

          

Environmental, Social & Governance (ESG)

 

 

 

 

 

 

 

 

 

Background of

Director Nominees

 LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

Gender

 Male Female Male Male Female Male Female Male Female

Race/Ethnicity

 White African
American
 African
American
 White African
American
 White White White White

Age

 58 64 43 69 65 63 65 57 54

Owens & Minor, Inc.2024 Proxy Statement21


 Proposal 1: Election of Directors 

Nominees for Election

 

Mark A. Beck

LOGO

LOGO   

Principal Occupation:

Co-founder and Owner of

B-Square Precision, LLC

Age 58

Director since 2019

Independent Director,

Chair of the Board

Committees:

Executive (Chair),
Governance & Nominating,
Our People & Culture

 

Stuart M. Essig, 56,

Background:

Mr. Beck serves as the Board’s Chair, a position he has held since September 2020, and is the co-founder and CEO of B-Square Precision, LLC, a private company engaged in the acquisition and management of companies that manufacture high-precision tools, dies, molds and components. Previously, Mr. Beck served as Chairman of the Board of Integra LifeSciences Holdings Corporation since 2012. From 1997 to 2012, he served asPresident and Chief Executive Officer of Integra LifeSciences, during which time he transitionedJELD-WEN Holding, Inc. (JELD-WEN), one of the business intoworld’s largest door and window manufacturers, from November 2015 to February 2018, and was a global surgical products company.director of JELD-WEN from May 2016 to February 2018. Prior to joining Integra LifeSciences,JELD-WEN, Mr. Essig wasBeck served as an Executive Vice President at Danaher Corporation, leading Danaher’s water quality and dental platforms, beginning in April 2014. Previously, he spent 18 years with Corning Incorporated in a managing directorseries of management positions with increasing responsibility, culminating in mergershis appointment as Executive Vice President overseeing Corning’s environmental technologies and acquisitions for Goldman Sachs Group, Inc. He also has been a Managing Partner since 2012 of Prettybrook Partners, a healthcare advisory firm. In addition to Integra LifeSciences, he alsolife science units in July 2012. Mr. Beck currently serves on the boardsboard of directors of IDEXX Laboratories, Seaspine HoldingsIDEX Corporation where he chairs the Nominating and Breg, Inc.Corporate Governance Committee and is a member of the Compensation Committee. He formerly served on the boardsboard of St. Jude Medical, Inc. and ZimmerBiomet. Mr. Essig has been a directordirectors of the Company since 2013.Dow-Corning Corporation from 2010 to 2014.

Qualifications:

 

The Board of Directors has nominated Mr. EssigBeck to continue his service as a director of the Company based on his strong backgroundexperience as a chief executive officer of a public company with significant international operations and leadership experience in the medical device manufacturing industryhis track-record of innovation and broad-based knowledge of the health care industry.successfully integrating acquired businesses. His insights into the medical supplies manufacturing industry, both domestic and international, bring a unique perspective to Owens & Minor’s Board that assists us both logistically and strategically as we grow our proprietary product manufacturing and sales capabilities and seek to manage and grow our many relationships with the manufacturing community at home and abroad.globally.

 

Gwendolyn M. Bingham

LOGO

LOGO

Principal Occupation:

Retired United States Army
Lieutenant General

(three-stars)

Age 64

Director since 2020

Independent Director

Committees:

Executive, Governance & 

Nominating (Chair)

 

John W. Gerdelman, 65, is Managing Partner

Background:

Lieutenant General (three-stars) Bingham retired in September 2019 from the U.S. Army following a 38-year career in the military. During her military career, LTG (retired) Bingham served as Department of River2, an investmentthe Army Assistant Chief of Staff for Installation Management from 2016 through her retirement in 2019. Previously, she was Commanding General, U.S. Army Tank-Automotive and consulting partnership. Mr. Gerdelman was President of Long Lines Limited, a telecommunications service provider,Armaments Lifecycle Management Command from 2014 to 2016; Commanding General, White Sands Missile Range from 2012 to 2014; Commandant, U.S. Army Quartermaster School from 2010 to 2011. Before joining Long Lines in 2010, heco-founded Intelliden Corporation,2012; and Chief of Staff, Combined Arms Support Command and Sustainment Center of Excellence from 2008 to 2010. LTG (retired) Bingham holds numerous civic and military honors and was the first woman to hold numerous positions as a network solutions provider for which Mr. Gerdelman servedU.S. Army General Officer including: the Army’s 51st Quartermaster General and Commandant of the U.S. Army Quartermaster School, Fort Lee, Virginia; the Commanding General, White Sands Missile Range, New Mexico and as Executive Chairman from 2003 until it was acquired by IBM in 2010. Mr. GerdelmanCommanding General, Tank-Automotive and Armaments Life Cycle Management Command, Warren, Michigan.

Qualifications:

The Board of Directors has served in a number of leadership positions for other telecommunications companies, including 15 years with MCI Communications Corporation. He currently serves on the board of directors of Brocade Communications Systems, Inc. and previously served on the boards of Sycamore Networks, Inc., Proxim Wireless Corporation, APAC Customer Services, Inc. and McData Corporation. Mr. Gerdelman has beennominated LTG (retired) Bingham to continue her service as a director of the Company based on her over 20 years of senior executive leadership experience in complex logistics and supply chain management, resource management, environmental and energy matters, talent management and strategic planning. Additionally, LTG (retired) Bingham has unique experience in leading the Army’s most significant integrated material management center with manufacturing centers in multiple locations and personnel worldwide to support the Army’s efforts to sustain, prepare and transform its operations, which provides insight into the challenges faced in the business of global distribution and supply chain management.

22Owens & Minor, Inc.2024 Proxy Statement


 Proposal 1: Election of Directors 

Kenneth Gardner-Smith

LOGO   

Principal Occupation:

Chief People Officer,

DaVita Inc.

Age 43

Director since 2010.2022

Independent Director

Committee:

Our People & Culture

Background:

Mr. Gardner-Smith has served as the Chief People Officer since 2020 for DaVita, Inc., a Fortune 500 kidney dialysis service provider. Prior to that Mr. Gardner-Smith has held the following positions with DaVita, including Regional Group VP, Field Operations – Southeast from 2015 to 2019, Division VP from 2014 to 2015, Group Director from 2013 to 2014, and Regional Director, Operations from 2011 to 2013. Prior to his employment with DaVita from 2008 to 2011, Mr. Gardner-Smith worked as an investment banker at Morgan Stanley focused on mergers and acquisitions. From 2003 to 2006, Mr. Gardner-Smith was Relationship Manager for Wells Fargo.

Qualifications:

 

The Board of Directors has nominated Mr. GerdelmanGardner-Smith to continue his service as a director of the Company based on his unique entrepreneurial background, extensive experience in finance and accounting and expertise in telecommunications and information systems. The Board believes the Company benefits from Mr. Gerdelman’s business management experience and perspectives as Owens & Minor continues to expand systems and technology solutions used to support our own business operationsleadership in the healthcare industry, including home-based care, as well as his experience developing process innovation, transformation, and talent strategies. His experience and range of perspectives as a senior healthcare executive in compensation, succession planning and diversity and inclusion will benefit the Company as it continues to provide customers with new productsdevelop talent and invest in human capital resources and expand as a medical product manufacturer and healthcare solutions partner for supply chain management.the healthcare industry.

  

Robert J. Henkel

LOGO

LOGO   

Principal Occupation:

Retired, President & Chief
Executive Officer of

Ascension Health

Age 69

Director since 2019

Independent Director

Committees:

Executive, Our People &    Culture (Chair)

  

Barbara B. Hill, 65, has

Background:

Mr. Henkel was the President, Healthcare Transformation at the THEO Executive Group, from January 2019 to March 2021. Previously, Mr. Henkel served as an Operating Partner of NexPhase Capital, a private equity firm (formerly Moelis Capital Partners), since 2011, where she focuses on healthcare-related investments and providing strategic and operating support for NexPhase’s healthcare portfolio companies. From 2006 to 2010, Ms. Hill served as Chief Executive Officer and President of FHC Health Systems and ValueOptions, Inc., a behavioral health benefits management company. Previously, Ms. Hill served as Chairman and Chief Executive Officer of WoodhavenAscension Health Services, an institutional pharmacy company,from 2012 until his retirement in July 2017. Prior to that Mr. Henkel was the Chief Operating Officer of Ascension Health from 2004 to 2006,2011. Ascension Health, Inc. is the largest non-profit healthcare system in the U.S. and President and a memberthe world’s largest Catholic health system. During his 25-year tenure with Ascension Health, Mr. Henkel was Chair of the boardAscension Innovation Counsel for Ascension Health, Inc. from July 2017 to 2019, and served in a number of directors of Express Scripts, a Fortune 100 pharmacy benefits management company, from 2002 to 2003. Ms. Hill also serves as a memberdifferent roles including President of the boardGreat Lakes and Mid-Atlantic States Operating Group. Prior to Ascension Health, Mr. Henkel held numerous executive leadership positions with other healthcare organizations, including the Daughters of directorsCharity National Health System, St. Louis; Mount Sinai Medical Center, Miami Beach, Fla.; SSM Health Care in St. Louis; and Montefiore Medical Center, Bronx, New York. Mr. Henkel is a Life Fellow with the American College of Omega Healthcare Investors, Inc., a Maryland real estate investment trust, Integra LifeSciences Holdings Corporation, a manufacturerExecutives and an adjunct professor of medical deviceshealth policy and implants and formerly served onmanagement with the boardUniversity of St. Jude Medical, Inc. Ms. Hill has been a directorPittsburgh Graduate School of the Company since February 2017.Public Health.

Qualifications:

 

The Board of Directors has nominated Ms. HillMr. Henkel to continue herhis service as a director of the Company based on herhis extensive experience in the healthcare industry. Ms. HillMr. Henkel brings deep leadership and management experience and insight both generally and specific to the healthcare industry, including unique strategic and operational experience from the managed healthcare and pharmaceutical industries. Herindustry. His unique perspective will benefit Owens & Minor as it continues to expand as a full-service partner for customers that focus on global healthcare solutions and understand the challenges faced at multiple levels within the global healthcare marketplace.

Owens & Minor, Inc.2024 Proxy Statement23


 Proposal 1: Election of Directors 

Rita F. Johnson-Mills

LOGO

LOGO    

Principal Occupation:

President, (Southern Region),

CINQCARE

Age 65

Director since 2022

Independent Director

Committee:

Governance & Nominating  

 

Lemuel E. Lewis, 71, is a former Chairman of the Board of the Federal Reserve Bank of Richmond, a position he held from 2009 until his retirement from the board on December 31, 2010. Mr. Lewis was appointed to the Board of the Federal Reserve Bank of Richmond in 2004 and

Background:

Ms. Johnson-Mills has served as Deputy ChairmanPresident (Southern Region) of CINQCARE since March 2022. Prior to that, Ms. Johnson-Mills served as founder and CEO of consulting firm RJM Enterprises from 2007January 2018 to 2008,February 2022. From August 2014 to December 2017, she served as President and ChairmanChief Executive Officer of the Audit Committee from 2005 to 2008. HeUnitedHealthcare Community Plan of Tennessee, a health plan serving more than 500,000 government sponsored healthcare consumers with over $2.5 billion of annual revenue, after having previously served as ExecutiveSenior Vice President, Performance Excellence and Accountability for UnitedHealthcare Community & State since 2006, and was a founding member of UnitedHealthGroup’s Diversity and Inclusion Council. Ms. Johnson-Mills also previously served as the Director of Medicaid Managed Care for the Centers for Medicare and Medicaid Services and as Chief FinancialExecutive Officer of Landmark Communications, Inc., a privately-held mediaManaged Health Services Indiana and broadcasting company, from 2000 to 2006. HeBuckeye Health Plan, wholly owned subsidiaries of Centene Corporation. Ms. Johnson-Mills currently serves on the public company board of directors of Markel Corporation where he is Chairman of the Audit Committee. He also serves on the board of directors of Dollar Tree, Inc.Nyxoah SA and previously served on the board of Landmark Communications,Brookdale Senior Living, Inc. Mr. LewisMs. Johnson-Mills also serves as a director on the private boards of Quest Analytics, LLC and Ellipsis Health, and is a Governance Fellow with the National Association of Corporate Directors (NACD). She is a Hogan Certified Executive Coach and a Senn Delaney Certified Corporate Culture Facilitator.

Qualifications:

The Board of Directors has beennominated Ms. Johnson-Mills to continue her service as a director of the Company based on her experience as a healthcare executive with more than 25 years of combined federal, state, and private industry experience. Her leadership experience and success in driving profitable, sustainable growth and implementation of programs to improve employee engagement and build strategic relationships in the public and private healthcare insurance sectors will benefit Owens & Minor as it continues to expand as a full-service partner for customers that focus on global healthcare solutions and offer indispensable guidance to our organization in our continued focus on home-based care solutions.

Stephen W. Klemash

LOGO   

Principal Occupation:

Retired Partner, Ernst &

Young and EY Americas

Center for Board Matters

Age 63

Director since 2011.2021

Independent Director

Committees:

Audit (Chair),

Executive

Background:

Mr. Klemash retired in June 2021 as a Partner with Ernst & Young LLP (EY), a position he held since 1997. Mr. Klemash served in a limited consulting capacity with EY through June 2022. In addition, Mr. Klemash also previously served as the Lead Partner with the EY Americas Center for Board Matters (CBM), from 2016 to December 2021. Prior to that Mr. Klemash held multiple Managing Partner positions for EY including from 2011 to 2016 East Central and Central Managing Partner of Accounts, from 2009 to 2011 East Central Region Managing Partner of Advisory, from 2007 to 2009 North Central Region Managing Partner of Assurance and Advisory Business Services and from 2002 to 2007 Pittsburgh Office Managing Partner. Prior to 2002, Mr. Klemash was an assurance practitioner, from the date of his hire by EY in 1984, serving clients in a variety of industries. Mr. Klemash is a certified public accountant and member of the American Institute of Certified Public Accountants.

Qualifications:

 

The Board of Directors has nominated Mr. LewisKlemash to continue his serviceto serve as a director of the Company based on his extensive experience working with public companies, strong financial knowledge, and breadth of experience in business consulting, accounting, risk management, technology and finance through his service as Chief Financial Officer of a private media company, as well as his service on thecybersecurity, and corporate governance. The Board of the Federal Reserve Bank of Richmond where he chaired the Audit Committee. He also brings a wide range of differing perspectives tobelieves that the Company based onwill benefit from Mr. Klemash’s comprehensive knowledge of board governance including ESG criteria along with his service on a numberaccounting, general business advisory skills and background in risk management and information security programs.

24Owens & Minor, Inc.2024 Proxy Statement


 Proposal 1: Election of Virginia college and foundation boards and through his membership on the boards of two other public companies, including service on their audit committees.Directors 

Teresa L. Kline

LOGO

LOGO   

Principal Occupation:

Retired, President and Chief 

Executive Officer of

Health Alliance Plan of

Michigan and Executive

Vice President of Henry

Ford Health System

Age 65

Director since 2022

Independent Director

Committee:

Audit

  

Martha H. Marsh, 69,

Background:

Ms. Kline retired in 20102019 as President &and Chief Executive Officer of Stanford Hospital & Clinics, a positionHealth Alliance Plan of Michigan and Executive Vice President of Henry Ford Health System, positions she held since 2002. She also served as the2016. Prior to that, her 40+ years of experience in healthcare include executive roles at Health Care Service Corporation (Senior Vice President and Chief Health Care Management Officer), HealthSouth (Senior Vice President), CHA Health (Chief Executive Officer), United Health Group (Chief Executive Officer of the University of California DavisUHC-GA), OnCare (Senior Vice President) and Aetna Health System from 1999 to 2002. After beginning her career at Arthur Andersen in 1975, she served the health care industry for more than thirty years in a variety of leadership positions, including as SeniorPlans (Regional Vice President for Professional Services and Managed Care at the University of Pennsylvania Health System.President). Ms. Marsh has also served on a variety of health care boards and committees. SheKline currently serves on the boardspublic company board of directors of AMNAmedisys, Inc., a home health and hospice company; and private company board of directors of SaVida Health, an outpatient opioid use disorder treatment provider, and Presbyterian Healthcare Services, Inc.a health system. Ms. Kline also serves on the board of Kalamazoo College. Previously, Ms. Kline served as the Chairman of two private health care technology companies, Medecision and Edward Life Sciences and previouslyAvaility. Ms. Kline formerly served on the board of Thoratecdirectors of Apria, Inc. Ms. Marsh has been a director of the Company since 2012., until it was acquired in March 2022 by Owens & Minor, Inc., and Intersect ENT, until it was acquired in May 2022 by Medtronic, Inc.

Qualifications:

 

The Board of Directors has nominated Ms. MarshKline to continue her service as a director of the Company based on her extensive backgroundknowledge in many different aspects of the healthcare industry including payor and provider experience, insurance, managed care, consulting, and outpatient facility management, and has successfully driven financial and operational turnaround, growth, mergers and acquisitions. Additionally, Ms. Kline is a seasoned healthcare executive with more than 35 years’ experience and deep knowledge of the health care industryhealthcare market dynamics and specifically the health care provider marketplace with which we conduct our business. Having served in the lead management position of some of the most prestigious health care systems in the United States, she brings unique perspectives on the requirements of and challenges faced by the health care provider industryregulations, as well as a deep understanding of the entire U.S. health care marketplace. Her broad-based background in accounting, finance, operationshealthcare technology and management in the context of the health care industry brings a multi-disciplinary and highly relevant point of view to our Board of Directors in assessing issues and challenges within the health care marketplace.cybersecurity oversight. Ms. Kline has significant outside board experience, including other public company boards.

Edward A. Pesicka

LOGO

LOGO    

Principal Occupation:

President and

Chief Executive Officer of   
Owens & Minor, Inc.

Age 57

Director since 2019

Committee:

Executive

  

Mark F. McGettrick, 60,

Background:

Mr. Pesicka is Executive Vicethe President and Chief FinancialExecutive Officer of Dominion EnergyOwens & Minor, Inc., a position he has held since June 2009. In addition,March 2019. Previously Mr. McGettrick also hasPesicka served as Executivean independent consultant and advisor in the healthcare, life sciences and distribution industries since January 1, 2016. From January 2000 through April 2015, Mr. Pesicka served in various roles of increasing responsibility at Thermo Fisher Scientific Inc., including, Chief Commercial Officer and Senior Vice President from January 2014 to April 2015. Prior to that, he was President, Customer Channels at Thermo Fisher from July 2008 to January 2014 and President, Research Market from November 2006 to July 2008. Earlier in his career, Mr. Pesicka held various Vice President-level roles in Thermo Fischer Scientific’s finance department, serving as Chief Financial Officer of numerous divisions. Prior to Thermo Fisher Scientific, Mr. Pesicka spent eight years with TRW, Inc. in its finance department and three years with PricewaterhouseCoopers as an auditor. Mr. Pesicka serves on the public company Board of Directors of Fortrea, where he is a member of the board of directors of Dominion Energy Midstream GP, LLC,Audit Committee and the general partner of Dominion Energy Midstream Partners, LP, since March 2014. From January 2003 to 2009, Mr. McGetterick served as Chief Executive Officer of the company’s Dominion Generation operating segment. Mr. McGettrick joined Dominion Energy, Inc. in 1980 and during his tenure has held a variety of other management positions in distribution design, accounting, customer service and generation. He currently serves on the board of directors of Virginia Electric and Power Company and Dominion Energy Gas Holdings, LLC, which are wholly-owned subsidiaries of Dominion Energy, Inc. Mr. McGettrick was appointed to the Board on March 1, 2018.Management Development & Compensation Committee.

Qualifications:

 

The Board of Directors has nominated Mr. McGettrickPesicka to serve as a director of the Company based on his background and breadth of experience in risk management, business planning, accounting, mergers and acquisitions and financial analysis through his service as a Chief Financial Officer of a large publicly-traded company.

LOGO

Eddie N. Moore, Jr., 70, retired in 2017 as President & Chief Executive Officer of Norfolk State University. From 2011 to 2012, he served as President of St. Paul’s College. He is President Emeritus of Virginia State University after serving as its President from 1993 to 2010. Prior to leading Virginia State University, Mr. Moore served as state treasurer for the Commonwealth of Virginia, heading the Department of the Treasury and serving on fifteen state boards and authorities. He also serves on the board of directors of Universal Corporation. Mr. Moore has been a director of the Company since 2005.

The Board of Directors has nominated Mr. Moore to continue his service as a director of the Company based on his strong background in accounting and finance, which qualify him to serve as an audit committee financial expert, and his leadership experience in managing prominent educational institutions. The Board believes that Mr. Moore’s experiences in the public sector bring unique perspectives and disciplines to the Board’s deliberations and decision-making processes.

LOGO

P. Cody Phipps, 56, joined Owens & Minor as its President & Chief Executive Officer effective July 1, 2015. He served as President & Chief Executive Officer of Essendant, Inc. (formerly United Stationers Inc.) from 2011 to 2015. He served as Essendant’s President from 2006 to 2011 and as Senior Vice President, Operations from 2003 to 2006. Previously, he was a Partner at McKinsey & Company, Inc., where heco-founded and led its Service Strategy and Operations Initiative, which focused on driving operational improvements in complex service and logistics environments. During his tenure at McKinsey, Mr. Phipps provided consulting services to a range of corporate clients across a diverse set of industries, including retail, manufacturing and healthcare. He formerly served on the board of directors ofCon-way, Inc. and currently serves on the board of directors of R.R. Donnelley & Sons Company. Mr. Phipps has been a director of the Company since 2015.

The Board of Directors has nominated Mr. Phipps to serve as a director of the Company based upon his unique ability as President and Chief Executive Officer to communicate to and inform the Board about the Company’sday-to-day operations, implementation of strategic initiatives, and industry developments. The Board believes that Mr. PhippsPesicka brings an invaluableimportant perspective on the Company’s current operations and ongoing relationships with customers and suppliers.

LOGO

Robert C. Sledd, 65, served as a Senior Economic Advisor to the Governor of Virginia from 2010 to 2014. Since 2008, he also has served as Managing Partner of Pinnacle Ventures, LLC Mr. Pesicka’s substantial experience and Sledd Properties, LLC. From 1995 to 2008, he served as Chairman of Performance Food Group Co. (“PFG”), a foodservice distribution company that heco-founded in 1987. He served as Chief Executive Officer of PFG from 1987 to 2001 and from 2004 to 2006. He also serves on the boards of directors of SCP Pool Corporation and Universal Corporation. Mr. Sledd has been a director of the Company since 2007.

The Board of Directors has nominated Mr. Sledd to continue his service as a director of the Company based on his expertise in economic and business development policy,distribution, as well as his experience as a former chief executive of a foodservice distribution company, including his knowledgethe healthcare and understanding of the specific issues and challenges faced by companies in the business of distribution and supply chain management. His experiences in founding, growing and taking public PFGlife sciences industries, allow him to contribute valuable industry perspectives and strategic leadership to the Board a breadthBoard.

Owens & Minor, Inc.2024 Proxy Statement25


 Proposal 1: Election of perspectives and ideas on matters of corporate management, governance and strategic growth.Directors 

Carissa L. Rollins

LOGO

LOGO    

Principal Occupation:

Chief Information Officer, 

Illumina, Inc.

Age 54

Director since 2022

Independent Director

Committee:

Audit

  

Anne Marie Whittemore, 71,

Background:

Ms. Rollins has been a partnerserved as the Chief Information Officer (“CIO”) at Illumina, Inc. since March 2022. Before joining Illumina, Ms. Rollins was CIO at UnitedHealthcare from 2017 to 2022. Prior to that from 2015 to 2017, Ms. Rollins held the positions of CIO and Executive Vice President, Human Resources at Gander Mountain, and from 2010 to 2015 in senior roles at Kohl’s Corporation. Prior to that, Ms. Rollins held management roles of increasing responsibility at Manpower Global and Miller-Coors. Ms. Rollins has served on the law firmBoard of McGuireWoods LLP since 1977.Directors for the YWCA, Minneapolis, and is currently the Board Chair. She also serves on the board of directors of T. Rowe Price Group, Inc., formerly served on the board of Albemarle Corporation and is a former Chairman of the Board of the Federal Reserve Bank of Richmond. Ms. Whittemore has been a director of the Company since 1991 and lead director since 2014.Grand Canyon Conservancy board.

Qualifications:

 

The Board of Directors has nominated Ms. WhittemoreRollins to continue her service as a director of the Company based on her extensive knowledge of global information systems strategy, operations, risk and compliance, infrastructure, enterprise architecture, cybersecurity, employee, and business-facing applications. Additionally, her vast information technology knowledge includes leadership of strategy, roadmap, and technology investments in support of the unique backgroundcommercial, Medicare and perspectives she brings to the Board as an attorney whose areas of specialty include corporate governanceretirement, and complex commercial and securities litigation matters. Her experience includes representation of several Fortune 100 corporations and other companies in matters involving corporate governance and shareholder matters.government programs technology business. Ms. Whittemore also has extensive experience as a public company director and member of both compensation and governance committees, which the Board believes contributes to herRollins’ strategic mindset, strong leadershiptechnical skills and led to her appointmentinformation systems acumen will be positive factors in 2014 as lead director.Owens & Minor’s continued growth and success.

The Board of Directors recommends a vote FOR the election of each nominee as director.Director.

RETIRING DIRECTORS

Effective immediately following the Annual Meeting, Messrs. Rogers and Simmons’ terms will expire, at which time they will retire from the Board. The Company gratefully acknowledges and thanks Mr. Rogers’ for his 26 years and Mr. Simmons for his four years of service and dedication to our Board.

 

LOGO

James E. Rogers, 72, served from 2011 to 2015 as Chairman of the Board of BackOffice Associates, LLC, a private company that provides data quality, migration and governance solutions. He served as President of SCI Investors Inc, a private equity investment firm, from 1993 until his retirement in 2011. He also serves on the board of directors of NewMarket Corporation and formerly served on the boards of Caraustar Industries, Inc., Wellman, Inc., Chesapeake Corp. and Cadmus Communications, Inc. Mr. Rogers has been a director of the Company since 1991 and has demonstrated significant leadership and communication skills in his service as the Company’s independent lead director for more than 10 years until 2014. Mr. Rogers will retire immediately following the 2018 Annual Meeting.

LOGO

David S. Simmons, 53, has served as Chairman & Chief Executive Officer of Pharmaceutical Product Development, LLC, a global biopharmaceutical research organization, since 2012. From 2001 to 2012, Mr. Simmons served in a variety of management positions with Pfizer, Inc., including as President and General Manager of the Emerging Markets and Established Products Business Units, Regional President of the Eastern Europe Pharmaceutical Division, President of the Pharmaceutical Division in Greece and Vice President of Marketing in Canada. Mr. Simmons has been a director of the Company since 2013 and will retire immediately following the 2018 Annual Meeting.

PROPOSAL 2: APPROVAL OF THE OWENS & MINOR, INC. 2018 STOCK INCENTIVE PLAN

The Company currently has in effect the 2015 Stock Incentive Plan (the “2015 Plan”). The 2015 Plan permits the grant of options, stock appreciation rights, stock awards, stock units and incentive awards. On February 8, 2018, our Board of Directors adopted the 26Owens & Minor, Inc. 2018 Stock Incentive Plan (the “2018 Plan”), subject to the approval2024 Proxy Statement


Proposal 2: Ratification of shareholders. Like the 2015 Plan, the 2018 Plan authorizes the grant of options, stock appreciation rights, stock awards, stock units and incentive awards. If the shareholders approve the 2018 Plan, no additional awards will be granted under the 2015 Plan after the date of shareholder approval of the 2018 Plan. The closing price of the Company’s Common Stock on March 1, 2018 was $16.11 per share.

Our Board of Directors believes that the 2015 Plan has benefited, and the 2018 Plan will benefit, the Company, by (i) assisting in recruiting and retaining the services of teammates andnon-employee directors with high ability and initiative, (ii) providing greater incentives for teammates andnon-employee directors who provide valuable services to the Company and its subsidiaries and affiliates and (iii) associating the interests of these persons with those of the Company and its shareholders.

Key features of the 2018 Plan, which contains provisions considered best practices for compensation and governance purposes, include:

The 2018 Plan generally will be administered by our Compensation Committee which consists entirely of independentnon-employee directors.

The 2018 Plan sets reasonable limits as to the awards any teammate, ornon-employee director may receive in any calendar year.

All stock options and stock appreciation rights must have an exercise price that is not less than the fair market value of the underlying stock on the grant date.

The maximum number of shares of our Common Stock that will be made available under the 2018 Plan is the sum of (i) 3,600,000 shares, less the number of shares of our Common Stock subject to awards granted under the 2015 Plan after March 1, 2018,plus (ii) the number of shares of our Common Stock subject to awards granted under the 2015 Plan that become available after March 1, 2018 because of the expiration, cancellation or forfeiture of the award without the issuance of the underlying shares. Between January 1, 2018 and March 1, 2018, awards representing 705,882 shares of Common Stock were granted under the 2015 Plan. This does not include awards to be granted in connection with our acquisition of Halyard Health S&IP, which we estimate will represent approximately 364,540 shares (based on a Common Stock price of $16.11 per share). We currently expect this acquisition to close early in the second quarter of 2018.

Shares of Common Stock not issued as the result of a net settlement of options, stock appreciation rights, stock awards, stock units and incentive awards, or tendered or withheld to pay the exercise price, purchase price or withholding taxes relating to options, stock appreciation rights, stock awards, stock units and incentive stock awards, shall not again be made available for issuance as awards under the 2018 Plan.

All awards granted under the 2018 Plan will be subject to aone-year minimum vesting period, provided that (i) up to 5% of the shares authorized for issuance under the 2018 Plan (subject to adjustments) may provide for vesting of awards in less than one year and (ii) awards granted tonon-employee directors may vest earlier than one year upon the annual meeting of the Company’s shareholders that occurs in the year immediately following the year of grant so long as the awards vest as of a date that is not earlier than two weeks prior to the anniversary date of the immediately preceding year’s annual shareholders meeting.

In connection with a change in control, vesting oftime-based awards will only be accelerated if the time-based awards are not assumed or converted into substitute awards following the change in control and vesting ofperformance-based awards shall only be accelerated to the extent of actual

achievement of the performance conditions as of the date of the change in control or on a prorated basis for time elapsed in ongoing performance period(s) through the date of the change in control, whichever the Committee determines appropriate, if the performance-based awards are not assumed or converted into substitute awards following the change in control. Otherwise, vesting of an award may only be accelerated in connection with a termination of service (including but not limited to death, disability, retirement or involuntary termination) or if the award is outstanding for at least one year, provided that up to 5% of the shares authorized for issuance under the 2018 Plan may be issued pursuant to awards without regard to any such restriction on accelerated vesting.

The 2018 Plan does not include any reload feature which would provide for an automatic grant of additional awards or any “evergreen” share replenishment features which would provide for an automatic increase in the number of shares available for issuance.

The 2018 Plan prohibits the repricing of outstanding stock options, stock appreciation rights and other stock awards in the nature of purchase rights, whether by amending an existing award or by substituting a new award at a lower price, without shareholder approval. The 2018 Plan also prohibits the payment of cash, awards or other securities in exchange forout-of-the-money awards, without shareholder approval.

Awards granted under the 2018 Plan are subject to the Company’s Recoupment Policy (which is described on page 52 of this proxy statement).

There is not a liberal change in control definition in the 2018 Plan. A change in control does not occur on announcement or commencement of a tender offer or a potential takeover or on shareholder approval of a merger or other transaction.

Any material amendments to the 2018 Plan require shareholder approval.

No dividends or dividend equivalents may be granted in connection with options, stock appreciation rights or other awards in the nature of purchase rights. No dividends or dividend equivalents may be paid in connection with a stock award or stock unit unless and until the award is no longer subject to forfeiture conditions, and any such dividends or dividend equivalents will either be (i) deemed reinvested in additional awards which remain subject to the same forfeiture and other conditions applicable to the award to which such dividends or dividend equivalents related or (iii) accumulated (without interest) and become payable only at the time and to the extent the related award becomes nonforfeitable and/or payable. No dividends may be paid with respect to an award that is forfeited.

The 2018 Plan does not provide for taxgross-ups of any kind.

A summary of the principal features of the 2018 Plan is included below. However, every aspect of the 2018 Plan is not addressed in this summary and shareholders are encouraged to read the full text of the 2018 Plan which is attached to this proxy statement asAnnex A. We have no current plans, proposals or arrangements, written or otherwise, to grant any specific awards under the 2015 Plan that have not been granted as of March 1, 2018or under the 2018 Plan, except in connection with the closing of our acquisition of Halyard Health S&IP or as provided for under our Board of Directors compensation plan (as described on pages 18 and 9 respectively of this proxy statement).

Reasons for the 2018 Plan and Recommendation of the Board of Directors

As described in more detail in this proxy statement under “Executive Compensation—Compensation Disclosure and Analysis,” we believe our compensation programs are structured to attract, retain and motivate our teammates andnon-employee directors. Our Board of Directors believes that equity incentive awards play a key role in these programs as they help align the interests of teammates andnon-employee directors with those of our shareholders. As of March 1, 2018, there were (1) 61,488,172 shares of our Common Stock outstanding, (2) 1,532,907 full value shares outstanding which include outstanding Performance Shares at target but there are no outstanding stock options or stock appreciation rights, and (3) only 773,638 shares available for grant under the 2015 Plan, which amount will be further reduced by the grant of awards representing an estimated 364,540 additional shares of Common Stock in connection with the Halyard Health S&IP acquisition.

Historical Burn Rate; Potential Economic Dilution Analysis. We are committed to managing the use of our equity incentives prudently to balance the benefits equity compensation brings to our compensation programs against the dilution it causes our shareholders. As part of our analysis when considering the number of shares to be reserved under the 2018 Plan, we considered the 2015 Plan’s “burn rate,” calculated as the number of shares subject to equity awards granted under the 2015 Plan, divided by the weighted average number of shares outstanding for that period. Our average burn rate for the three years ending December 31, 2017 was 3.73%. The total potential dilution resulting from issuing all shares authorized under our equity plans as of March 1, 2018 would be approximately 3.8%. We believe that our burn rate and potential dilution amounts are reasonable for our industry and market conditions. Since the 2015 Plan was adopted, we have sought to provide equity compensation to our teammates andnon-employee directors who we believe are important to our organization in furthering our business strategy. In addition, since that time we have made multiple leadership appointments and promotions to advance our strategy. We made equity grants from the 2015 Plan in connection with each of these new hires and promotions. We believe these new hires and promotions are key to the development and strengthening of the management team with the experience and talent necessary to further implement our transformation. Additionally, we have made two significant acquisitions in 2017 and 2018, Byram Healthcare and Halyard Health S&IP, to accelerate our transformation and have issued awards under our 2015 Plan prior to March 1, 2018 representing 63,501 shares of Common Stock to teammates who have joined us from Byram Healthcare and expect to issue awards representing an additional 364,540 shares of Common Stock to teammates who will join us from Halyard Health S&IP.

Expected Duration. We expect that the shares available under the 2018 Plan for future awards, if the 2018 Plan is approved by our shareholders, will be sufficient forcurrently-anticipated awards for the next three- four years. Expectations regarding future share usage could be impacted by a number of factors such as hiring and promotion activity at the executive level; the rate at which shares are returned to the 2018 Plan reserve upon awards’ expiration, forfeiture or cash settlement; the future performance of our stock price; factors involved in acquiring other companies; and other factors. While we believe that the assumptions we used are reasonable, future share usage may differ from current expectations.

For the foregoing reasons, our Board of Directors recommends that our shareholders approve the 2018 Plan.

Administration of the 2018 Plan

The 2018 Plan is generally administered by the Compensation Committee. The Compensation Committee approves all terms of awards to teammates under the 2018 Plan. The Compensation Committee also approves the teammates who will receive grants under the 2018 Plan, determines the type of award that will be granted and approves the number of shares of Common Stock subject to the grant. The Governance & Nominating Committee of the Board of Directors administers the 2018 Plan in the case of any award that is made to a member of the Board who is not also a teammate of the Company or an affiliate. References in this summary to the “Compensation Committee” include, with respect to awards made tonon-employee directors, the Governance & Nominating Committee.

Participation in 2018 Plan

Because awards under the 2018 Plan are made at the Compensation Committee’s discretion, we are unable to determine who will be selected to receive awards or the type, size or terms of the awards that may be granted. For the same reason, we are unable to determine the awards that would have been granted last year if the 2018 Plan had been in effect. However, outstanding awards previously granted under the 2015 Plan are reported herein. See “Grants of Plan Based Awards Table” on page 56 and “Outstanding Equity Awards at FiscalYear-End Table” on page 58 of this proxy statement.

Any teammate, consultant ornon-employee director of the Company or any affiliate who, in the judgment of the Compensation Committee, has contributed significantly or can be expected to contribute significantly to

the performance of the Company and/or its affiliates may receive an award under the 2018 Plan. The Company currently has approximately 8,600 teammates (including approximately 10 teammates who are officers), and the Company currently has 11non-employee directors. In fiscal 2017 the Company made awards to 301 participants, which included nine executive officers and our 10non-employee directors. The Compensation Committee has the complete discretion, as provided in the 2018 Plan, to select eligible teammates, consultants and/ornon-employee directors to receive awards under the 2018 Plan and to determine for each teammate, consultant ornon-employee director the nature of the award and the terms and conditions of each award.

The basis for participation in the 2018 Plan is that the Compensation Committee has determined that such participation will further the 2018 Plan’s purposes. In exercising its discretion, the Compensation Committee will consider the recommendations of management and the purposes of the 2018 Plan, which include the recruiting and retaining of teammates andnon-employee directors with high ability and initiative, providing greater incentives for teammates andnon-employee directors who provide valuable services to the Company and its subsidiaries and affiliates and associating the interests of these persons with those of the Company and its shareholders. For a description of the basis of participation for our executive officers andnon-employee directors during fiscal 2017, see “Compensation Discussion and Analysis” beginning on pages 33 through 53 of the proxy statement and “Director Compensation” on page 9 of the proxy statement.

The 2018 Plan includes reasonable limits on the benefits that any participant may receive for any calendar year. No teammate may be granted, in any calendar year, (i) options, stock appreciation rights or other purchase rights for more than 2,000,000 shares of our Common Stock, (ii) stock awards or stock units for more than 1,000,000 shares of our Common Stock or (iii) incentive awards exceeding $10,000,000. The foregoing limitations can be multiplied by two for awards granted to teammates during the calendar year in which the teammate first commences employment or other service. The 2018 Plan also provides that in any calendar year anon-employee director may not be granted awards during any single calendar year in respect of thenon-employee director’s service as a member of the board that, taken together with any cash fees paid to thenon-employee director, exceeds $750,000 in total value (calculating the value of any such awards based on the grant date fair value of such awards for financial accounting purposes). The Compensation Committee may, however, make exceptions to the foregoing limit (up to twice such limit) for anon-executive chair of the Board of Directors or, in extraordinary circumstances, for other individualnon-employee directors, as the Compensation Committee may determine, provided that thenon-employee director receiving such awards may not participate in the decision to make such awards.

Share Authorization

The maximum aggregate number of shares of Common Stock that may be issued under the 2018 Plan is the sum of (i) 3,600,000 shares, less the number of shares of our Common Stock subject to awards granted under the 2015 Plan afterMarch 1, 2018, plus (ii) the number of shares of our Common Stock that are subject to awards granted under the 2015 Plan that become available after March 1, 2018 because of the expiration, cancellation or forfeiture of the award without the issuance of the underlying shares. In connection with stock splits, stock dividends, recapitalizations and certain other events, the Board will make adjustments that it deems appropriate in the aggregate number of shares of Common Stock that may be issued under the 2018 Plan, the terms of outstanding awards and the per individual grant limitations.

Except as described herein, each share of Common Stock issued in connection with an award granted under the 2018 Plan will reduce the total number of shares of Common Stock available for issuance under the 2018 Plan by one. If any options, stock appreciation rights, stock awards, stock units or other awards terminate, expire or are canceled, forfeited, exchanged or surrendered without having been exercised or paid or without issuance of the underlying shares, the Common Stock subject to such awards, to the extent of the termination, expiration, cancellation, forfeiture, surrender or cash settlement, will again be available for awards under the 2018 Plan. Any shares of Common Stock that are tendered or withheld from the settlement of an award to satisfy the grant or exercise price or to satisfy a tax withholding obligation under an award will not be available for future awards to

be granted under the 2018 Plan. If Common Stock is issued in settlement of a stock appreciation right, the number of shares available for future awards will be reduced by the number of shares for which the stock appreciation right was exercised rather than the number of shares issued. Shares of Common Stock that may be issued under the 2018 Plan may not be increased through the Company’s purchase of shares of Common Stock on the open market with the proceeds obtained from the exercise of options or other purchase rights granted under the 2018 Plan.

Awards

The Compensation Committee will determine the eligible individuals who will receive awards under the 2018 Plan and the Compensation Committee will specify the type of award that is made and will prescribe the terms and conditions that govern each award. The 2018 Plan generally provides that no award will become fully exercisable or entirely vested before the first anniversary of the date of grant of the award, provided that (i) awards may be granted without regard to this minimum vesting requirement with respect to a maximum of 5% of the shares of Common Stock authorized for issuance under the 2018 Plan and (ii) awards may be granted without regard to the minimum vesting requirement tonon-employee directors as described above. Notwithstanding the preceding sentence, the Compensation Committee may accelerate the exercisability or vesting of awards (i) in connection with a termination of employment or other service (including without limitation on death, disability, retirement or involuntary termination) or (ii) if the award has been outstanding for at least one year, and up to 5% of the shares of Common Stock authorized for issuance under the 2018 Plan may be issued without regard to any such restrictions on accelerated vesting of awards.

Options.    The 2018 Plan authorizes the Compensation Committee to grant incentive stock options (under Section 421 of the Internal Revenue Code) and options that do not qualify as incentive stock options. The exercise price of each option will be determined by the Compensation Committee, provided that the price cannot be less than 100% of the fair market value of the Common Stock on the date on which the option is granted (or 110% of the shares’ fair market value on the grant date in the case of an incentive stock option to an individual who is a “ten percent shareholder” under Sections 422 and 424 of the Internal Revenue Code). Except in the event of stock splits, stock dividends and other changes in our capitalization, unless approved by shareholders, the exercise price of an outstanding option cannot be reduced and no payment can be made to cancel an option if the exercise price exceeds the shares’ fair market value on the date of cancellation.

The exercise price for any option is generally payable (i) in cash, (ii) in a cash equivalent acceptable to the Compensation Committee, or (iii) by the surrender of Common Stock (including Common Stock otherwise issuable upon exercise of the option) (or attestation of ownership of Common Stock) with an aggregate fair market value on the date on which the option is exercised equal to the exercise price for the number of shares being purchased.

The term of an option cannot exceed 10 years from the date of grant (or five years in the case of an incentive share option granted to a “ten percent shareholder”). The Compensation Committee may grant options that have a term less than the maximum term permitted under the 2018 Plan. The 2018 Plan provides for the automatic exercise of options if (a) the participant remains in the continuous employ or service of the Company from the date of grant until the stated expiration date of the option and (b) the fair market value of the shares subject to the option exceeds the exercise price. In that event, if not exercised by the participant, the option will be exercised on the stated expiration date and the participant will be issued shares of Common Stock that have a fair market value equal to the excess of the aggregate number of shares subject to the exercised portion of the option over the number of shares whose fair market value equals the aggregate exercise price of the option and applicable tax withholdings.

No dividends may be paid with respect to an option.

Stock Awards.    The 2018 Plan also provides for the grant of stock awards. A stock award is an award of Common Stock that will be subject to restrictions on transferability and such other restrictions as the

Compensation Committee determines on the date of grant and consistent with the terms of the 2018 Plan, including the vesting requirements described above. The vesting requirements or restrictions may be stated with reference to one or more performance objectives, including objectives stated with respect to “performance goals” as described below under “Performance Objectives.” The restrictions, if any, may lapse over a specified period of time or through the satisfaction of conditions, in installments or otherwise, as the Compensation Committee may determine.

A participant who receives a stock award will have all of the rights of a shareholder as to those shares, including, without limitation, the right to vote and the right to receive dividends or distributions on the shares; provided, however, that the 2018 Plan provides that dividends payable on a stock award shall either be deemed reinvested in additional stock awards, which shall remain subject to the same forfeiture and transfer conditions applicable to the stock award with respect to which such dividends related, or accumulated and paid in cash, without interest, if and at the time the related stock award is no longer subject to forfeiture and transfer conditions. During the period, if any, when stock awards arenon-transferable or forfeitable, (i) a participant is prohibited from selling, transferring, pledging, exchanging, hypothecating or otherwise disposing of his or her stock award shares, (ii) the company will retain custody of the certificates and (iii) a participant must deliver a share power to the Company for each stock award. No dividends may be paid with respect to a stock award that is forfeited.

Stock Appreciation Rights.    The 2018 Plan authorizes the Compensation Committee to grant stock appreciation rights that provide the recipient with the right to receive, upon exercise of the stock appreciation right, cash, Common Stock or a combination of the two. The amount that the recipient will receive upon exercise of the stock appreciation right generally will equal the excess of the fair market value of the Common Stock on the date of exercise over the shares’ fair market value on the date of grant (the “initial value”). Stock appreciation rights will become exercisable in accordance with terms prescribed by the Compensation Committee and consistent with the terms of the 2018 Plan, including the vesting requirements described above. Stock appreciation rights may be granted in tandem with an option grant or independently from an option grant. The term of a stock appreciation right cannot exceed ten years from the date of grant or five years in the case of a share appreciation right granted in tandem with an incentive stock option awarded to a “ten percent shareholder”. The Compensation Committee may grant stock appreciation rights that have a term less than such maximum terms. The 2018 Plan provides for the automatic exercise of a stock appreciation right if (a) the participant remains in the continuous employ or service from the date of grant until the stated expiration date of the stock appreciation right and (b) the fair market value of the shares subject to the stock appreciation right exceeds the initial value per share. In that event, if not exercised by the participant, the stock appreciation right will be exercised on the stated expiration date and the participant will receive the amount payable for exercises on that date (subject to applicable withholdings).

Except in the case of stock splits, stock dividends and other changes in our capitalization, the initial value of an outstanding stock appreciation right cannot be reduced without the approval of shareholders. In addition, the 2018 Plan provides that no payment may be made on account of the cancellation of a stock appreciation right if the initial value exceeds the fair market value of a share of Common Stock.

No dividends may be paid with respect to any stock appreciation rights.

Stock Units.    The 2018 Plan also authorizes the Compensation Committee to grant awards of stock units. Stock units represent the participant’s right to receive an amount, based on the value of the Common Stock, if the requirements established by the Compensation Committee are satisfied. Consistent with the terms of the 2018 Plan, including the vesting requirements described above, the Compensation Committee will determine the applicable performance period, the performance goals and such other conditions that apply to the stock unit award. Performance goals may be stated with respect to the performance criteria described below under “Performance Objectives” or such other criteria determined by the Compensation Committee. If the performance goals and other requirements are met, stock units will be paid in cash, Common Stock or a combination thereof.

Incentive Awards.    The 2018 Plan also permits the grant of incentive awards. An incentive award is an opportunity to earn a payment upon the terms and conditions prescribed by the Compensation Committee. The terms and conditions may provide that the incentive award will be earned only if the participant’s employment continues for a specified period or only to the extent that the participant, the Company or an affiliate achieves objectives measured over a period of at least one year. The objectives may be stated with reference to one or more of the performance criteria described below under “Performance Objectives” or such other criteria determined by the Compensation Committee. If an incentive award is earned, the amount payable will be paid in cash, Common Stock or a combination thereof. No dividends may be paid in respect of an incentive award.

Change in Control

Unless an outstanding award is assumed or otherwise continued after a change in control, upon a change in control andcash-out of the award, (i) each option and stock appreciation right shall be fully exercisable thereafter, (ii) each stock award will become transferable and nonforfeitable, (iii) each stock unit award shall be earned in its entirety and converted into a transferable and nonforfeitable stock award, and (iv) each incentive award shall be earned, in whole or in part, in accordance with the terms of the applicable award agreement, except that (i) each performance-based option and stock appreciation right shall be exercisable, (ii) each performance-based stock award will become transferable and nonforfeitable, (iii) each performance-based stock unit award will be earned and converted into a transferable and nonforfeitable stock award, and (iv) each performance-based incentive award shall be earned only to the extent of actual performance through the date of the change in control or pro rata based on the elapsed portion of the performance period as of the date of the change in control, whichever the Committee determines appropriate.

In the event of a change in control, the Compensation Committee, in its discretion and without the need for a participant’s consent, may provide that an outstanding option, stock appreciation right, stock award, stock unit award or incentive award shall be assumed by, or a substitute award granted by, the surviving entity in the change in control. Such assumed or substituted award shall be of the same type of award as the original option, stock appreciation right, stock award, stock unit award or incentive award being assumed or substituted.

Unless an outstanding award is to be assumed or otherwise continued after the change in control, the Compensation Committee, in its discretion and without the need of a participant’s consent, may provide that (i) each option and stock appreciation right that is or will be exercisable on the date of the change in control, (ii) each stock award that is or will become transferable and nonforfeitable, (iii) each stock unit award that is or will be earned and convertible into a transferable and nonforfeitable stock award and (iv) each inventive award that is or will be earned shall be cancelled in exchange for a payment. The payment may be in cash, shares of Common Stock or other securities or consideration received by Company shareholders in the change in control transaction. The amount of the payment will be equal to (i) the amount by which the price per share received by the shareholder in the transaction exceeds the exercise price of the option or initial value of the stock appreciation right, (ii) the price per share received by the shareholders in the transaction for each share subject to a stock award or stock unit or (iii) the amount earned under the incentive award. Notwithstanding the foregoing, however, awards that are not vested,non-forfeitable or payable as of the change in control will be cancelled without any payment therefor.

A change of control under the 2018 Plan generally occurs if:

a person, entity or affiliated group (with certain exceptions) acquires, in a transaction or series of transactions, at least 30% of our combined voting power;

we merge with another entity unless (i) the voting securities of the Company immediately prior to the merger continue to represent more than 50% of the combined voting power of the securities in the merged entity or its parent or (ii) the merger is effected to implement a recapitalization transaction in which no person acquires more than 30% of our combined voting power;

there is consummated an agreement for the sale or disposition of all or substantially all of our assets;

the stockholders approve a plan of complete liquidation; or

during any period of twelve (12) consecutive months, individuals who, at the beginning of such period, constitute our Board, together with any new directors whose nomination or election was approved by a majority of the directors then so in office (other than individuals who become directors in connection with certain transactions or election contests), cease for any reason to constitute a majority of our Board.

The Internal Revenue Code has special rules that apply to “parachute payments,”i.e., compensation that is payable on account of a change in control. If the parachute payments exceed a safe harbor amount prescribed by the Internal Revenue Code, then the recipient is liable for a 20% excise tax on a portion of the parachute payments, and the Company is not allowed to claim a federal income tax deduction for a portion of the parachute payments.

The 2018 Plan provides for a reduction in benefits if the benefits of awards, either alone or together with parachute payments under other plans and agreements, exceed the safe harbor amount. In that event, the participant’s total parachute payments will be reduced to the safe harbor amount,i.e., the maximum amount that may be paid without an excise tax liability or loss of deduction. However, the benefits will not be reduced, and the participant will receive all of the parachute payments, if the participant will receive a greaterafter-tax benefit, taking into account the excise tax payable by the participant, by receiving all of the parachute payments. The 2018 Plan provides that these provisions do not apply to a participant who, under an agreement with the Company or the terms of another plan is not permitted to receive parachute payments in excess of the safe harbor amount.

Performance Objectives

The 2018 Plan also identifies performance criteria that may be used to establish performance goals that will determine whether an award becomes vested or is earned. The Compensation Committee may prescribe that an award will become vested or be earned upon the attainment of one or more performance goals or objectives, including but not limited to: (i) gross, operating or net earnings before or after taxes; (ii) return on equity; (iii) return on capital; (iv) return on sales; (v) return on assets or net assets; (vi) earnings per share; (vii) cash flow per share; (viii) book value per share; (ix) earnings growth; (x) sales or sales growth; (xi) volume growth; (xii) cash flow (as defined by the Compensation Committee); (xiii) Fair Market Value; (xiv) total shareholder return; (xv) market share; (xvi) productivity; (xvii) level of expenses; (xviii) quality; (xix) safety; (xx) customer satisfaction; (xxi) total economic value added; (xxii) earnings before interest, taxes, depreciation and amortization; and (xxiii) revenues or revenue growth.

A performance goal or objective may be stated with respect to the Company, a subsidiary or a business unit and also may be stated with respect to one or more of these criteria or may be expressed on an absolute basis or relative to the performance of one or more similarly situated companies or a published index. In establishing a performance goal or objective, the Compensation Committee may exclude any or all special, unusual or extraordinary items as determined under generally accepted accounting principles, including the charges or costs associated with restructurings of the Company, discontinued operations, other unusual ornon-recurring items and the cumulative effects of accounting changes. The Compensation Committee may also adjust performance goals or objectives, including to reflect the impact of unusual ornon-recurring events affecting the Company and for changes in applicable tax laws and accounting principles.

Section 162(m) Transition Rule

If and to the extent that the Compensation Committee grants an award under the 2018 Plan in substitution for an award intended to constitute “qualified performance-based compensation” under Section 162(m) of the Internal Revenue Code, as in effect prior to the enactment of the Tax Cuts and Jobs Act of 2017, or pursuant to a

binding contract in effect as of November 2, 2017 and intended to constitute “qualified performance-based compensation” under the special transition rule under Section 162(m) then such award shall be (i) subject to such terms and conditions as are required for the award to continue to qualify under the transition rule for “qualified performance-based compensation” under Section 162(m) under the Tax Cuts and Jobs Act of 2017, as the Compensation Committee shall determine, (ii) the award will be administered by asub-committee of the Compensation Committee which is comprised of two or more members that qualify as “outside directors” under Section 162(m) prior to the enactment of the Tax Cuts and Jobs Act of 2017, and (iii) none of the provisions of the 2018 Plan shall apply to such award to the extent such provisions would result in the award no longer qualifying under the transition rule for “qualified performance-based compensation” under Section 162(m) prior to the Tax Cuts and Jobs Act of 2017.

Return of Awards; Repayment

The 2018 Plan provides that all awards, and all payments under awards, are subject to any policy that the Company adopts requiring the return or repayment of compensation and/or benefits,i.e., a claw-back or compensation recoupment policy. To the extent required by any such policy as in effect on the date that the award is granted, the date the option or stock appreciation right was exercised, the date of payment or the date the award became vested or earned, a participant will be required to return any award (if not previously exercised or settled) and any payment previously made or proceeds received with respect to any award (if the award has vested or been settled).

Amendment; Termination

The 2018 Plan may be amended or terminated at any time by the Board of Directors; provided that no amendment may adversely impair the rights of participants under outstanding awards. Our shareholders must approve any amendment if such approval is required under applicable law or stock exchange requirements. Our shareholders also must approve any amendment that materially increases the benefits accruing to participants under the 2018 Plan, materially increases the aggregate number of shares of Common Stock that may be issued under the 2018 Plan (other than adjustments to reflect stock dividends, stock splits and other changes in capitalization) or materially modifies the requirements as to eligibility for participation in the 2018 Plan. In addition, except in connection with adjustments to reflect stock dividends, stock splits and other changes in capitalization, the exercise price of an option, the purchase price of an award or the initial value of a stock appreciation right may not be reduced and no action that would constitute are-pricing of such awards may be taken without the approval of shareholders.

The 2018 Plan provides that, unless terminated sooner by the Board or extended with shareholder approval, no awards may be made under the 2018 Plan after February 7, 2028.

Deferral of Awards

The Compensation Committee may permit a participant to defer, or if and to the extent specified in an award agreement require the participant to defer, receipt of the payment of cash or the delivery of shares of Common Stock that would otherwise be due by virtue of the lapse or waiver of restrictions with respect to awards, the satisfaction of any requirements or goals with respect to awards, the lapse or waiver of the deferral period for awards, or the lapse or waiver of restrictions with respect to awards. If such deferral is permitted, the Compensation Committee will establish rules and procedures for making such deferral elections and for the payment of such deferrals which will be intended to conform in form and substance with applicable regulations promulgated under Section 409A of the Internal Revenue Code. There are no assurances, however, that a participant will not be subjected to tax penalties under Section 409A with respect to any awards or such deferrals.

No Employment Rights

Awards do not confer upon any individual any right to continue in the employ or service of the Company or any affiliate.

U.S. Federal Income Tax Consequences

The grant of an option or stock appreciation right will create no tax consequences for the participant or the Company at the time of the grant. A participant will have no taxable income upon exercise of an incentive stock option except that a participant must recognize income equal to the fair market value of the shares acquired minus the exercise price for alternative minimum tax purposes. Upon exercise of an option (other than an incentive stock option) or a stock appreciation right, a participant generally must recognize ordinary income equal to the fair market value of the shares and/or the amount of cash acquired minus the exercise price or initial value. Upon a disposition of shares acquired by exercise of an incentive stock option on or before the earlier of the second anniversary of the grant of such incentive stock option or the first anniversary of the exercise of such option, the participant generally must recognize ordinary income equal to the lesser of (1) the fair market value of the shares at the date of exercise minus the exercise price, or (2) the amount realized upon the disposition of the incentive stock option shares minus the exercise price. Otherwise, a participant’s disposition of shares acquired upon the exercise of an option (including an incentive stock option for which the incentive stock award option holding periods are met) generally will result in only capital gain or loss. Other awards under the 2018 Plan, including stock awards, stock units and incentive awards, will generally result in ordinary income to the participant equal to the cash or the fair market value of the shares received (minus the amount, if any, paid by the participant for such shares) at the time such cash or shares are received by the participant or, if later, the time that the substantial risk of forfeiture of such shares lapses.

The Company generally will be entitled to claim a tax deduction with respect to an award granted under the 2018 Plan when the participant recognizes ordinary income with respect to the award in an amount equal to the ordinary income that is recognized by the participant. The Company will not be entitled to claim any tax deduction of any amount recognized by a participant as capital gains.

The Company will be permitted to withhold from any award granted under the 2018 Plan any required withholding taxes. Payment of withholding taxes may be made through one or more of the following means: payment in cash (including personal check or wire transfer), or, with the approval of the Committee, by delivering shares previously owned by the grantee or by delivery of shares acquired or to be acquired under the award.

Section 83(b) of the Internal Revenue Code.A participant may elect under Section 83(b) of the Internal Revenue Code to be taxed at the time of grant of a stock award on the fair market value of the shares at that time rather than to be taxed when the risk of forfeiture lapses on the stock, and the Company will have a deduction available at the same time and in the same amount as the participant recognized income. If a participant files an election under Section 83(b) and the participant subsequently forfeits the restricted shares, he or she would not be entitled to any tax deduction, including as a capital loss, for the value of the shares on which he or she previously paid tax. Except as discussed below, the Company generally will be entitled to a tax deduction at the time and equal to the amount recognized as ordinary income by the participant in connection with an option, stock appreciation right, or other award, but will be entitled to no tax deduction relating to amounts that represent a capital gain to a participant, Thus, the Company will not be entitled to any tax deduction with respect to an incentive stock option if the participant holds the shares for the incentive stock option holding periods.

The Board of Directors recommends that you vote FOR approval of the Owens & Minor, Inc. 2018 Stock Incentive Plan.

PROPOSAL 3: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMIndependent Registered Public Accounting Firm

The Audit Committee (with confirmation of the Board) has selected KPMG LLP to serve as the Company’s independent registered public accounting firm for the year ending December 31, 20182024, and has directed that management submit such appointment of KPMG LLP for ratification by the shareholders at the annual meeting.Annual Meeting. Representatives of KPMG LLP will be present at the annual meetingAnnual Meeting to answer questions and to make a statement if they desire to do so.

Under the Sarbanes-Oxley Act of 2002 and the rules of the SEC promulgated thereunder, the Audit Committee is solely responsible for the appointment, compensation, and oversight of the work of the Company’s independent registered public accounting firm. Shareholder ratification of this appointment is not required by the Company’s Bylaws or otherwise. If shareholders fail to ratify the appointment, the Audit Committee will take such failure into consideration in future years. If shareholders ratify the appointment, the Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if it is determined that such a change would be in the best interests of the Company.

Prior to selecting KPMG LLP for fiscal 2018,2024, the Audit Committee evaluated KPMG’sKPMG LLP’s performance with respect to fiscal 2017.2023. In conducting this annual evaluation, the Audit Committee considered management’s assessment of KPMG’sKPMG LLP’s performance in areas such as (i) independence, (ii) the quality and the efficiency of the services provided, including audit planning and coordination, (iii) industry knowledge and (iv) the quality of communications, including KPMG LLP staff accessibility and keeping management and the Committee apprised of issues. The Audit Committee also considered KPMG’sKPMG LLP’s tenure, the impact on the Company of changing auditors and the reasonableness of KPMG’s billableKPMG LLP’s rates. The Audit Committee is responsible for the audit fee negotiations associated with the retention of KPMG LLP. In order to assure continuing auditor independence, the Audit Committee periodically considers whether there should be a regular rotation of the independent registered accounting firm. Further, in conjunction with the rotation of the auditing firm’s lead engagement partner every five years, the Audit Committee and its chairpersonchair will continue to be directly involved in the selection of KPMG LLP’s new lead engagement partner. The members of the Audit Committee and the Board believe that the continued retention of KPMG LLP to serve as our independent external auditor is in the best interests of usOwens & Minor and our stockholders.shareholders.

The Board of Directors recommends a vote FOR the ratification of the appointment of KPMG LLP to serve as the Company’s independent registered public accounting firm for the year ending December 31, 2018.2024.

FEES PAID TO INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMFees Paid to Independent Registered Public Accounting Firm

For each of the years ended December 31, 20172023 and 2016,2022, KPMG LLP billed the Company the fees set forth below in connection with professional services rendered by that firm to the Company:

 

   Year 2017   Year 2016 

Audit Fees

  $2,110,500   $1,956,000 

Audit-Related Fees

   23,500    32,000 

Tax Fees

   264,000    102,000 

All Other Fees

   —      —   
  

 

 

   

 

 

 

Total

  $2,398,000   $2,090,000 
   
   Year 2023 ($)  Year 2022 ($) 
  

Audit Fees(1)

 

$

4,377,500

 

 

$

4,457,000

 

  

Audit-Related Fees(2)

 

 

63,000

 

 

 

38,000

 

  

Tax Fees(3)

 

 

243,300

 

 

 

310,000

 

  

All Other Fees(4)

 

 

169,310

 

 

 

9,000

 

  

Total

 

$

4,853,110

 

 

$

4,814,000

 

Audit Fees.    These were fees for professional services performed for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s filings on Forms10-K and10-Q, Sarbanes-Oxley compliance, and services normally provided in connection with statutory and regulatory filings or engagements.

(1)

Fees for professional services performed for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s filings on Forms 10-K and 10-Q, Sarbanes-Oxley compliance, and services normally provided in connection with statutory, regulatory filings or engagements and services related to the Apria acquisition in 2022.

(2)

Fees primarily for the annual audit of the Company’s employee benefit plan financial statements and agreed-upon procedures attestation in 2023.

(3)

Fees primarily for advice and consulting services related to the structuring of international operations and sales and use tax returns.

(4)

All other fees in 2023 include a cyber maturity assessment, and in 2023 and 2022, include fees for online resources provided by KPMG LLP.

Owens & Minor, Inc.2024 Proxy Statement27


 Proposal 2: Ratification of Independent Registered Public Accounting Firm 

Audit-Related Fees.    These were fees primarily for the annual audits of the Company’s employee benefit plan financial statements, internal control attestations in certain foreign jurisdictions and consultations by management related to financial accounting and reporting matters.

Tax Fees.    These were fees primarily for advice and consulting services related to the structuring of international operations, and the restructuring of business operations.

The Audit Committee has established policies and procedures for thepre-approval of audit services and permittednon-audit services in order to ensure the services do not impair the auditor’s independence. The Audit Committee willpre-approve on an annual basis the annual audit services engagement terms and estimated fees and will alsopre-approve certain audit-related services that may be performed by the independent auditors up to the estimated pre-approved fee levels, as well as permissible tax planning and compliance services. The Audit Committee may delegatepre-approval authority to one or more of its members, but anypre-approval decision by such member or members must be presented to the full Audit Committee at its next scheduled meeting. All services provided by, and fees paid to, KPMG LLP in 20172023 werepre-approved by the Audit Committee in accordance with thepre-approval policies, and there were no instances of waiver of approval requirements or guidelines being waived during this period.

REPORT OF THE AUDIT COMMITTEEReport of the Audit Committee

The Audit Committee iswas composed of fourfive directors in 2023, and is currently composed of three directors, each of whom is independent under the enhanced independence standards for audit committees in the Exchange Act and the rules thereunder as incorporated into the listing standards of the NYSE and under the Company’s Corporate Governance Guidelines, and twoone of whom have been determined by the Board of Directors to be an audit committee financial experts.expert. The Audit Committee met sevensix times during 2017.2023. The Audit Committee operates under a written charter adopted by the Board of Directors, which the Audit Committee reviews at least annually and revises as necessary to ensure compliance with current regulatory requirements and industry changes.

As its charter reflects, the Audit Committee has a broad array of duties and responsibilities. responsibilities and assists the Board in fulfilling its oversight responsibility related to the preparation of financial statements, compliance with legal and regulatory requirements, the Company’s independent registered public accounting firm, including its qualifications, performance and independence, the Company’s internal audit function, treasury and finance matters, and the Company’s enterprise risk management and data and cybersecurity risks.

With respect to financial reporting and the financial reporting process, management, the Company’s independent registered public accounting firm and the Audit Committee have the following respective responsibilities:responsibilities set forth below.

Management is responsible for:

 

Establishing and maintaining the Company’s internal control over financial reporting;

Establishing and maintaining the Company’s internal control over financial reporting;

 

Assessing the effectiveness of the Company’s internal control over financial reporting as of the end of each year; and

Assessing the effectiveness of the Company’s internal control over financial reporting as of the end of each year; and

 

Preparation, presentation and integrity of the Company’s consolidated financial statements.

Preparation, presentation and integrity of the Company’s consolidated financial statements.

The Company’s independent registered public accounting firm is responsible for:

 

Performing an independent audit of the Company’s consolidated financial statements and the Company’s internal control over financial reporting;

Performing an independent audit of the Company’s consolidated financial statements and the Company’s internal control over financial reporting;

 

Expressing an opinion as to the conformity of the Company’s consolidated financial statements with U.S. generally accepted accounting principles; and

Expressing an opinion as to the conformity of the Company’s consolidated financial statements with U.S. generally accepted accounting principles; and

 

Expressing an opinion as to the effectiveness of the Company’s internal control over financial reporting.

Expressing an opinion as to the effectiveness of the Company’s internal control over financial reporting.

The Audit Committee is responsible for:

 

Selecting the Company’s independent registered public accounting firm;

Overseeing and reviewing the financial statements and the accounting and financial reporting processes of the Company; and

Selecting the Company’s independent registered public accounting firm;

 

Overseeing and reviewing the consolidated financial statements and the accounting and financial reporting processes of the Company; and

Overseeing and reviewing management’s evaluation of the effectiveness of internal control over financial reporting.

Overseeing and reviewing management’s evaluation of the effectiveness of internal control over financial reporting.

In this context, the Audit Committee has met and held discussions with management and KPMG LLP, the Company’s independent registered public accounting firm. Management represented to the Audit Committee that the Company’s consolidated financial statements for the year ended December 31, 20172023 were prepared in accordance with U.S. generally accepted accounting principles. The Audit Committee has reviewed and discussed these consolidated financial statements

28Owens & Minor, Inc.2024 Proxy Statement


 Proposal 2: Ratification of Independent Registered Public Accounting Firm 

with management and KPMG LLP, including the scope of the independent registered public accounting firm’s responsibilities, critical accounting policies and practices used, and significant financial reporting issues and judgments made in connection with the preparation of such financial statements.

The Audit Committee has discussed with KPMG LLP the matters required to be discussed pursuant to Public Company Accounting Oversight Board Auditing Standard No. 1301 (Communications with Audit Committees). The Audit Committee has also received the written disclosures and communications from KPMG LLP required by the PCAOB regarding the independence of that firm and has discussed with KPMG LLP the firm’s independence from the Company.

In addition, the Audit Committee has discussed with management its assessment of the effectiveness of internal control over financial reporting and has discussed with KPMG LLP its opinion as to the effectiveness of the Company’s internal control over financial reporting.

Based upon its discussions with management and KPMG LLP and its review of the representations of management and the report of KPMG LLP to the Audit Committee, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form10-K for the year ended December 31, 20172023 for filing with the SEC.

THE AUDIT COMMITTEE

Stephen W. Klemash, Chair

Teresa L. Kline

Carissa L. Rollins

Lemuel E. Lewis, ChairmanOwens & Minor, Inc.2024 Proxy Statement29


Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan

John W. GerdelmanIn this Proposal 3, the Company’s shareholders are being asked to approve Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan (the “2023 Plan” or, as amended, the “Amended 2023 Plan”), a copy of which is attached as Annex A, to (i) increase the aggregate number of shares of Common Stock available for issuance under the 2023 Plan by 2,150,000 shares of Common Stock, (ii) increase the aggregate number of shares of Common Stock that may be issued or used with respect to incentive stock options (“ISOs”) by 2,150,000 shares of Common Stock and (iii) prohibit liberal share recycling for all awards (the “Proposed Amendments”). Other than the Proposed Amendments, no material changes will be made to the 2023 Plan. If the Company’s shareholders do not approve this Proposal 3, the 2023 Plan will continue by its terms, without the Proposed Amendments, and will terminate automatically on May 11, 2033.

Eddie N. Moore, Jr.Historical Information

Robert C. SleddThe 2023 Plan authorizes the Company to grant equity awards, including stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based awards to eligible teammates, consultants and non-employee directors of our Company and its affiliates, up to 4,025,000 shares of Common Stock. As of March 15, 2024, there were 2,741,643 shares of Common Stock remaining available for issuance under the 2023 Plan. If Amendment No. 1 to the 2023 Plan is approved by the Company’s shareholders, 2,150,000 additional shares of Common Stock will be authorized for issuance thereunder, subject to the adjustment provisions of the 2023 Plan described below.

The following table provides certain additional information regarding awards outstanding and unvested under the 2023 Plan as of March 15, 2024:

Options Outstanding

0

Weighted Average Exercise Price of Options Outstanding

N/A

Weighted Average Remaining Term of Options Outstanding

N/A

Total Full-Value Awards Outstanding (Including Restricted Stock Units, Restricted Stock, target Performance Stock Units and target Performance Shares)(1)

3,983,644

Shares of Common Stock Outstanding

76,598,351

Overhang(2)

5.20%

Shares Available for Future Grant under the 2023 Plan

2,741,643

Dilution under the 2023 Plan, as a Percentage of Common Stock Outstanding(3)

8.78%

(1)

Total full-value awards outstanding as of March 15, 2024 were comprised of the following: restricted stock units/restricted stock 2,975,141; performance stock units/performance shares (based on the target performance level) 1,008,503.

(2)

Overhang consists of the number of shares subject to equity awards outstanding as of March 15, 2024, divided by the number of Common Stock outstanding as of March 15, 2024.

(3)

Dilution consists of the number of shares subject to equity awards outstanding as of March 15, 2024, and the number of shares available for future grant under the 2023 Plan, divided by the number of Common Stock outstanding as of March 15, 2024.

Why Amendment No. 1 to the 2023 Plan is Important

We believe that aligning the interests of teammates and non-employee directors with those of long-term shareholders is a key element of compensation at the Company; accordingly, it is essential that the Company maintain the flexibility and sufficient share reserve in the 2023 Plan to appropriately incentivize teammates and non-employee directors who provide valuable services to the Company and its affiliates. The 2023 Plan has benefited the Company by (i) assisting in recruiting and retaining the services of teammates and non-employee directors with high ability and initiative, (ii) providing greater incentives for teammates and non-employee directors who provide valuable services to the Company and its affiliates, and (iii) associating the interests of teammates and non-employee directors with those of the Company and its shareholders. For our CEO and other NEOs, equity-based incentive awards represent a significant portion of their compensation, with such awards representing approximately 69% and 63% of total target compensation, respectively. Amendment No. 1 to the 2023 Plan is intended to enhance the 2023 Plan and is needed to continue our equity compensation program, which is an important element in our ability to remain competitive in attracting and retaining experienced talent. We believe that our ability to recruit, retain and incentivize top talent will be adversely affected if Proposal 3 is not approved.

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 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

STOCK OWNERSHIP INFORMATIONHistorical Burn Rate; Potential Economic Dilution Analysis

We are committed to managing the use of our equity incentives prudently to balance the benefits equity compensation brings to our compensation programs against the dilution it causes our shareholders. As part of our analysis when considering the number of shares to be added to the 2023 Plan by Amendment No. 1, we considered our equity plans’ “burn rate,” calculated as (i) the number of shares subject to equity awards granted under the Owens & Minor, Inc. 2018 Stock Incentive Plan (the “2018 Plan”) and the 2023 Plan for the three years ending December 31, 2023, divided by (ii) the weighted average number of shares outstanding for that period. Our average burn rate for the three years ending December 31, 2023 was 3.87%. The total potential dilution resulting from issuing all shares authorized under our equity plans as of March 15, 2024 (including the 2,150,000 additional shares that would be available if shareholders approve Amendment No. 1) would be approximately 11.59%. We believe that our burn rate and potential dilution amounts are reasonable for our industry and market conditions. During this three-year period, we have sought to provide equity compensation to our teammates and non-employee directors who we believe are important to our organization in furthering our business strategy. In addition, during this time we have made multiple leadership appointments and promotions to advance our strategy. Additionally, we made a significant business acquisition in 2022 of Apria, Inc. to accelerate our business strategy and issued awards representing 275,025 shares of Common Stock to teammates who joined us from Apria, including the employment of Apria’s former CEO, who was appointed as our Company’s Executive Vice President, President – Patient Direct & CEO of Apria upon the closing of the acquisition. Also contributing significantly to the number of awards that we were required to issue under the 2023 Plan in furthering our business strategy was a decline in the trading price of our Common Stock in 2022 and 2023, which required the issuance of a greater number of awards to achieve our intended incentives.

Expected Duration

If Amendment No. 1 to the 2023 Plan is approved by our shareholders, we expect that the shares available under the 2023 Plan for future awards will be sufficient for currently-anticipated awards for the next two years. Expectations regarding future share usage could be impacted by a number of factors such as: (i) the future performance of our stock price; (ii) hiring and promotion activity at the executive level; (iii) the rate at which shares are returned to the 2023 Plan reserve upon awards’ expiration, forfeiture or cash settlement without the issuance of the underlying shares; (iv) factors involved in acquiring other companies; and (v) other factors. While we believe that the assumptions we used are reasonable, future share usage may differ from current expectations.

For the foregoing reasons, our Board of Directors recommends that our shareholders approve Amendment No. 1 to the 2023 Plan.

Amended 2023 Plan Best Practices

The Amended 2023 Plan includes several features that are consistent with the interests of shareholders and corporate governance best practices, including the following:

No automatic award grants are promised to any eligible individual;

No liberal share recycling for any awards;

Awards assumed by a successor in connection with a change in control will not vest solely as a result of the change in control (unless specifically provided otherwise in an award agreement or any applicable employment agreement or similar agreement);

No tax gross-ups under the Amended 2023 Plan;

No evergreen for the Amended 2023 Plan share reserve;

No repricing, replacement or re-granting of options, stock appreciation rights or other stock awards without shareholder approval (except in the event of certain equitable adjustments or a change in control, as further described below);

Any award (or portion thereof) granted under the Amended 2023 Plan will vest no earlier than the first anniversary of the date the award is granted (subject to an exception equal to no more than 5% of the shares reserved for issuance under the Amended 2023 Plan);

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 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

Awards, including time-based awards, are subject to potential reduction, cancellation or recoupment pursuant to the Company’s clawback policy, as discussed in more detail on page 58;

Awards are generally nontransferable;

Meaningful annual limits on total non-employee director compensation; and

Dividends and dividend equivalents are subject to restrictions and risk of forfeiture to the same extent as the award with respect to which such dividends or dividend equivalents are accrued and will not be paid unless and until such award has vested.

Summary of the Amended 2023 Plan

The Amended 2023 Plan will provide for the grant of both ISOs, which are intended to qualify for favorable tax treatment under Section 16(a) Beneficial Ownership Reporting Compliance422 of the Code, and non-qualified stock options, as well as the grant of stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, other stock-based awards, cash awards and substitute awards intended to align the interests of our service providers with those of our shareholders.

Based solelyThis section summarizes material features of the Amended 2023 Plan. The summary is qualified in its entirety by reference to the complete text of the 2023 Plan, attached as an exhibit to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and Amendment No. 1 to the 2023 Plan, attached hereto as Annex A, which are both incorporated by reference into this Proposal 3.

The only material changes to the 2023 Plan as a result of the Proposed Amendments will be to (i) increase the aggregate number of shares of Common Stock available for issuance under the 2023 Plan by 2,150,000 shares of Common Stock, (ii) increase the aggregate number of shares of Common Stock that may be issued or used with respect to ISOs by 2,150,000 shares of Common Stock and (iii) prohibit recycling of shares (a) tendered as payment for the exercise of an award, (b) withheld to cover taxes or (c) shares covered by a stock-settled Stock Appreciation Right or other stock-settled Award that were not issued upon the settlement of the Award, as described in further detail below.

Securities to be Offered

The aggregate number of shares of Common Stock that may be issued pursuant to the Amended 2023 Plan will not exceed 6,175,000 shares of Common Stock (subject to any increase or decrease pursuant to the Amended 2023 Plan) (the “Share Reserve”). The aggregate number of shares of Common Stock that may be issued or used with respect to any ISO will not exceed the Share Reserve. The closing price per share of our Common Stock on March 15, 2024 was $25.47. Any award under the Amended 2023 Plan settled in cash will not be counted against the Share Reserve. Notwithstanding anything to the contrary contained in the Amended 2023 Plan, shares of Common Stock subject to an award under the Amended 2023 Plan or an award that was outstanding under the 2018 Plan as of the effective date of the 2023 Plan (a “Prior Plan Award”) will not again be made available for issuance or delivery under the Amended 2023 Plan if such shares of Common Stock are (i) delivered, withheld or surrendered in payment of the exercise or purchase price of an award or a Prior Plan Award, (ii) delivered, withheld, or surrendered to satisfy any tax withholding obligation or (iii) shares covered by a stock-settled Stock Appreciation Right or other stock-settled Award that were not issued upon the settlement of the Award. Shares of Common Stock subject to a Prior Plan Award that was granted pursuant to an exception under Section 303A.08 of the NYSE Listed Company Manual that become available for issuance under the Amended 2023 Plan will remain subject to the terms and conditions set forth in such exception. The number of shares of Common Stock available for issuance under the Amended 2023 Plan will not be reduced by shares issued pursuant to awards issued or assumed in connection with a merger or consolidation, except that shares acquired by exercise of substitute ISOs will count against the maximum number of shares that may be issued pursuant to the exercise of ISOs under the Amended 2023 Plan.

Administration

The Amended 2023 Plan will be administered by a committee of the Board that has been authorized to administer the Amended 2023 Plan, except if no such committee is authorized by the Board, the Board will administer the Amended 2023 Plan (as applicable, the “Committee”). The Committee will have broad discretion to administer the Amended 2023 Plan, including the power to determine the eligible individuals to whom awards will be granted, the number of awards to be

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 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

granted and the terms and conditions of awards. The Committee may also accelerate the vesting or exercise of any award and make all other determinations and take all other actions necessary or advisable for the administration of the Amended 2023 Plan. To the extent the Committee is not the Board, the Board will still retain the authority to take all actions permitted by the Committee under the Amended 2023 Plan.

Eligibility

Teammates, consultants and non-employee directors of our Company and its affiliates will be eligible to receive awards under the Amended 2023 Plan. As stated above, the basis for participation in the Amended 2023 Plan is the Committee’s decision to select, in its sole discretion, participants from among those eligible. The Company and its affiliates have approximately 350 teammates, and eight non-employee directors who will be eligible to participate in the Amended 2023 Plan.

Non-Employee Director Compensation Limits

The fair value of any awards granted under the Amended 2023 Plan to a non-employee director as compensation for services on the Board, during any one calendar year, taken together with any cash fees paid to such non-employee director during such period in respect of the non-employee director’s services as a member of the Board during such year, may not exceed $750,000, provided that (i) the Committee may make exceptions to this limit, except that the non-employee director receiving such additional compensation may not participate in the decision to award such compensation or in other contemporaneous decisions involving compensation for non-employee directors and (ii) for any calendar year in which a non-employee director serves as lead director or non-executive chair of the Board, such limit will be increased to $1,500,000; provided, further, that such limit will be applied without regard to awards or other compensation, if any, provided to a non-employee director during any period in which such individual was an employee of the Company or any affiliate or was otherwise providing services to the Company or to any affiliate other than in the capacity as a non-employee director.

Minimum Vesting Term

A vesting period of at least one year will apply to all awards issued under the Amended 2023 Plan; provided that (i) up to 5% of the shares of Common Stock reserved for issuance under the Amended 2023 Plan may be issued pursuant to awards that do not comply with such minimum one year vesting period and (ii) an award granted to a non-employee director may vest on the earlier of (a) the date that is one year following the date on which such award is granted or (b) the first annual meeting of the Company’s recordsshareholders that occurs following the date such award is granted,provided that such vesting period may not be less than 50 weeks following the date such award is granted. Notwithstanding the foregoing, the Committee retains the ability to accelerate the vesting of any award for any reason.

Prohibition on Repricing

Except in the event of certain equitable adjustments or a change in control, as described in the Amended 2023 Plan, without the approval of the shareholders of the Company, no amendment may be made to the Amended 2023 Plan that would (i) increase the aggregate number of shares of Common Stock that may be issued under the Amended 2023 Plan; (ii) change the classification of individuals eligible to receive awards under the Amended 2023 Plan; (iii) reduce the exercise price of any option or stock appreciation right; (iv) grant any new option, stock appreciation right, or other award in substitution for, or upon the cancellation of, any previously granted option or stock appreciation right that has the effect of reducing the exercise price thereof; (v) exchange any option or stock appreciation right for Common Stock, cash, or other consideration when the exercise price per share under such option or stock appreciation right exceeds the fair market value of a share; or (vi) take any action that would be considered a “repricing” of an option or stock appreciation right under the applicable listing standards of the national exchange on which the Common Stock is listed.

Types of Awards

Options

The Amended 2023 Plan provides for the grant of both ISOs intended to qualify under Section 422 of the Code and information provided bynon-qualified stock options. We may grant options to eligible persons, except that ISOs may only be granted to persons who

Owens & Minor, Inc.2024 Proxy Statement33


 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

are our directors, executive officersteammates or teammates of one of our subsidiaries, in accordance with Section 422 of the Code. The exercise price of an option cannot be less than 100% of the fair market value of a share of Common Stock on the date on which the option is granted and beneficial ownersthe option must not be exercisable for longer than ten years following the date of grant. However, in the case of an ISO granted to an individual who owns (or is deemed to own) at least 10% of the total combined voting power of all classes of our equity securities, the exercise price of the option must be at least 110% of the fair market value of a share of Common Stock on the date of grant and the option must not be exercisable more than 5%five years from the date of grant.

Options granted under the Amended 2023 Plan generally must be exercised by the optionee before the earlier of the expiration of such option or at such time or times as will be determined by the Committee at the time of grant.The exercise price for the option may be paid upon such terms and conditions as established by the Committee and set forth in the applicable award agreement. The Committee may establish payment terms for the exercise of options pursuant to which the Company may withhold a number of shares that otherwise would be issued to the participant in connection with the exercise of the option having a fair market value on the date of exercise equal to the exercise price, or that permit the participant to deliver cash or shares with a fair market value equal to the exercise price on the date of payment, or through a simultaneous sale through a broker of shares acquired on exercise, all as permitted by applicable law.

Stock Appreciation Rights

A stock appreciation right is the right to receive an amount equal to the excess of the fair market value of one share of Common Stock on the date of exercise over the grant price of the stock appreciation right. The grant price of a stock appreciation right cannot be less than 100% of the fair market value of a share of Common Stock on the date on which the stock appreciation right is granted. The term of a stock appreciation right may not exceed ten years. The Committee has the discretion to determine other terms and conditions of a stock appreciation right award.

Restricted Stock Awards

A restricted stock award is a grant of shares of Common Stock subject to the restrictions on transferability and risk of forfeiture imposed by the Committee. Unless otherwise determined by the Committee and specified in the applicable award agreement, the holder of a restricted stock award has rights as a shareholder, including the right to vote the shares of Common Stock subject to the restricted stock award or to receive dividends on the shares of Common Stock subject to the restricted stock award during the restriction period. In the discretion of the Committee, dividends distributed prior to vesting may be subject to the same restrictions and risk of forfeiture as the restricted shares with respect to which the distribution was made.

Restricted Stock Units

A restricted stock unit is a right to receive cash, shares of Common Stock or a combination of cash and shares of Common Stock at the end of a specified period equal to the fair market value of one share of Common Stock on the date of vesting. Restricted stock units may be subject to the restrictions, including a risk of forfeiture, imposed by the Committee. The Committee may determine that a grant of restricted stock units will provide a participant a right to receive dividend equivalents, which entitles the participant to receive the equivalent value (in cash or shares of Common Stock) of dividends paid on the underlying shares of Common Stock. Dividend equivalent rights may be paid currently or credited to an account, settled in cash or shares, and may be subject to the same restrictions as the restricted stock units with respect to which the dividend equivalent rights are granted.

Performance Awards

A performance award is an award that vests and/or becomes exercisable or distributable subject to the achievement of certain performance goals during a specified performance period, as established by the Committee. Performance awards may be granted alone or in addition to other awards under the Amended 2023 Plan, and may be paid in cash, shares of Common Stock, other property, or any combination thereof, in the sole discretion of the Committee.

Other Stock-Based Awards

Other stock-based awards are awards payable in, valued in whole or in part by reference to, or otherwise based on or related to, the value of shares of Common Stock.

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 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

Cash Awards

Cash awards may be granted in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by applicable law, as determined by the Committee. Cash awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Committee may accelerate the vesting of such awards at any time in its sole discretion.

Substitute Awards

In connection with an entity’s merger or consolidation with the Company or the Company’s acquisition of an entity’s property or stock, the Committee may grant awards in substitution for any options or other stock, or stock-based awards granted before such merger or consolidation by such entity or its affiliate.

Dividends and Dividend Equivalents Rights

Dividends and dividend equivalent rights may be granted at the discretion of the Committee. Dividend equivalent rights represent the right to receive the value of dividends, if any, paid by in respect of the number of shares of Common Stock underlying an award. Any dividend or dividend equivalent rights credited with respect to an award (except for dividends paid following the grant of an award of unrestricted (i.e., fully vested) shares) will be subject to the same restrictions on transferability and forfeitability to the same extent as the award with respect to which such shares of Common Stock or other property has been distributed and subject to such other terms and conditions as set forth in the relevant award agreement. Any dividends or dividend equivalent rights granted with respect to an award will be payable to the participant only if, when and to the extent such underlying award vests. The dividend equivalent rights granted with respect to awards that do not vest will be forfeited.

Certain Transactions

If the Company effects any merger, consolidation, statutory exchange, spin-off, reorganization, sale or transfer of all or substantially all the Company’s assets or business, or other corporate transaction or event in such a manner that the Company’s outstanding shares of Common Stock are converted into the right to receive (or the holders of Common Stock are entitled to receive in exchange therefor), securities or other property of the Company or other entity, then, (i) the aggregate number or kind of securities that thereafter may be issued under the Amended 2023 Plan, (ii) the number or kind of securities or other property (including cash) to be issued pursuant to awards granted under the Amended 2023 Plan, or (iii) the exercise or purchase price thereof, will be adjusted by the Committee to prevent dilution or enlargement of the rights granted to, or available for, participants under the Amended 2023 Plan.

Change in Control

The Amended 2023 Plan does not provide for the automatic acceleration of vesting of outstanding awards upon a change in control event solely with respect to the occurrence of the change in control unless the successor company fails to assume or replace the awards in connection with that change in control event, unless otherwise provided in an award agreement or any applicable employment agreement, or similar agreement. To the extent the successor company fails to assume or replace the awards, any performance-based awards will be deemed earned at the greater of (i) the target level of performance as set forth in the award agreement, and (ii) the actual performance achieved, measured and calculated as of the date of the change in control pursuant to a shortened performance period ending on the occurrence of the change in control.

Unless the individual award agreement or any applicable employment agreement, or similar agreement provides otherwise, if the successor company assumes the awards, vesting of the award will be accelerated upon a subsequent termination of the participant’s service, consulting relationship or employment without cause, or, if the participant resigns for good reason, in each case, within 24 months following the change in control, with any performance-based awards will be deemed earned at the greater of (i) the target level of performance as set forth in the award agreement, and (ii) the actual performance achieved, measured and calculated as of the date of the change in control pursuant to a shortened performance period ending on the occurrence of the change in control.

Owens & Minor, Inc.2024 Proxy Statement35


 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

Tax Withholding

The Company and any of its affiliates have the right to withhold, or require payment of, the amount of any applicable income tax, social insurance contribution or other applicable taxes that are required to be withheld in respect of an award. The Committee may, in its sole discretion, permit or require a participant to satisfy all or any portion of the applicable taxes that are required to be withheld with respect to an award by (i) the delivery of shares that have been both held by the participant and vested for at least six months (or such other period as established by the Committee) having an aggregate fair market value equal to such withholding liability (or portion thereof); (ii) having the Company withhold from the shares otherwise issuable or deliverable to, or that would otherwise be retained by, the participant upon the grant, exercise, vesting, or settlement of the award, as applicable, a number of shares with an aggregate fair market value equal to the amount of such withholding liability; or (iii) by any other means specified in the applicable award agreement or otherwise determined by the Committee.

Limitations on Transfer of Awards

Participants may not transfer options or stock appreciation rights granted under the Amended 2023 Plan other than by will or by the laws of descent and distribution, and all options and stock appreciation rights will be exercisable, during the participant’s lifetime, only by the participant. The Committee may determine, in its sole discretion, that a non-qualified stock option that is otherwise not transferable is transferable to a family member of the participant under certain circumstances.

Restricted stock awarded under the Amended 2023 Plan may not be transferred by participants during the period or periods set by the Committee, commencing on the date of such award, as set forth in the applicable award agreement.

Shares of Common Stock subject to other stock-based awards may not be transferred prior to the date on which the shares are issued or, if later, the date on which any applicable restriction, performance, or deferral period lapses, subject to the applicable provisions of the relevant award agreement and the Amended 2023 Plan.

All certificates for shares delivered under the Amended 2023 Plan will be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the SEC, any stock exchange upon which the Common Stock is then listed or any national securities exchange system upon whose system the Common Stock is then quoted, and any applicable law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

Clawback

All awards granted under the Amended 2023 Plan are subject to the Company’s clawback policy, as described in more detail on page 58.

Plan Amendment and Termination

The Board or the Committee may amend or terminate any award, award agreement or the Amended 2023 Plan at any time, provided that the rights of a participant granted an award prior to such amendment or termination may not be materially impaired without such participant’s consent. In addition, shareholder approval will be required for any amendment to the extent necessary to comply with applicable law or exchange listing standards. The Committee will not have the authority, without the approval of shareholders, to amend any outstanding option or share appreciation right to reduce its exercise price per share. The Amended 2023 Plan will remain in effect until May 11, 2033 (unless earlier terminated by the Board).

Material U.S. Federal Income Tax Consequences

The following is a general summary under current law of the principal U.S. federal income tax consequences related to awards under the Amended 2023 Plan. This summary describes the general federal income tax principles that apply, as based on current law and interpretational authorities which are subject to change at any time and is provided only for

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general information. This summary does not purport to be complete discussion of all potential tax effects relevant to recipients of awards under the Amended 2023 Plan. No attempt has been made to discuss any potential non-U.S., state, or local tax consequences. This summary is not intended as tax advice to participants, who should consult their own tax advisors. Non-qualified stock options or stock appreciation rights with an exercise price less than the fair market value of shares of our Common Stock on the date of grant, stock appreciation rights payable in cash, restricted stock units, and certain other awards that may be granted pursuant to the Amended 2023 Plan, could be subject to additional taxes unless they are designed to comply with certain restrictions set forth in Section 409A of the Code and guidance promulgated thereunder.

Tax Consequences to Participants under the Amended 2023 Plan

Non-Qualified Stock Optionsand Stock Appreciation Rights

If a participant is granted a non-qualified stock option or stock appreciation right under the Amended 2023 Plan, the participant should not have taxable income on the grant of the non-qualified stock option or stock appreciation right. Upon the exercise of a non-qualified stock option or stock appreciation right, a participant will recognize ordinary compensation income, subject to withholding obligations for a teammate, in an amount equal to the fair market value of the shares acquired on the date of exercise, less the exercise price paid for the shares. The participant’s basis in the Common Stock for purposes of determining gain or loss on a subsequent sale or disposition of such shares generally will be the fair market value of our Common Stock on the date the participant exercises such option or stock appreciation right. When a participant sells the Common Stock acquired as a result of the exercise of a non-qualified stock option or stock appreciation right, any appreciation or depreciation in the value of the Common Stock after the exercise date will be taxable as a long-term or short-term capital gain or loss for federal income tax purposes, depending on the holding period. The Common Stock must be held for more than twelve months to qualify for long-term capital gain treatment. Subject to the discussion under “Tax Consequences to the Company” below, the Company and its subsidiaries or affiliates generally should be entitled to a federal income tax deduction at the time and for the same amount as the participant recognizes ordinary income.

Incentive Stock Options

A participant receiving ISOs should not recognize taxable income upon grant. Additionally, if applicable holding period requirements are met, the participant should not recognize taxable income at the time of exercise. However, the excess of the fair market value of the shares of our Common Stock received over the option exercise price is an item of tax preference income potentially subject to the alternative minimum tax. If stock acquired upon exercise of an ISO is held for a minimum of two years from the date of grant and one year from the date of exercise and otherwise satisfies the ISO requirements, the gain or loss (in an amount equal to the difference between the fair market value on the date of disposition and the exercise price) upon disposition of the stock will be treated as a long-term capital gain or loss, and we believewill not be entitled to any deduction. If the holding period requirements are not met, the ISO will be treated as one that all reports requireddoes not meet the requirements of the Code for ISOs and the participant will recognize ordinary income at the time of the disposition equal to the excess of the amount realized over the exercise price, but not more than the excess of the fair market value of the shares on the date the ISO is exercised over the exercise price, with any remaining gain or loss being treated as capital gain or capital loss. The Company and its subsidiaries or affiliates generally are not entitled to a federal income tax deduction upon either the exercise of an ISO or upon disposition of the shares acquired pursuant to such exercise, except to the extent that the participant recognizes ordinary income on disposition of the shares.

Other Awards

A participant will recognize ordinary compensation income upon receipt of cash pursuant to a cash award or, if earlier, at the time the cash is otherwise made available for the participant to draw upon. Individuals will not have taxable income at the time of grant of a restricted stock unit, but rather, will generally recognize ordinary compensation income at the time he or she receives cash or a share of Common Stock in settlement of the restricted stock unit, as applicable, in an amount equal to the cash or the fair market value of the Common Stock received. The current federal income tax consequences of other awards authorized under the Amended 2023 Plan generally follow certain basic patterns: nontransferable restricted stock subject to a substantial risk of forfeiture results in income recognition equal to the excess of the fair market value over the price paid, if any, only at the time the restrictions lapse (unless the recipient elects to accelerate recognition as of the date of grant through a Section 83(b) election); dividend equivalents and other stock or cash based awards are

Owens & Minor, Inc.2024 Proxy Statement37


 Proposal 3: Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan 

generally subject to tax at the time of payment. We or our subsidiaries or affiliates generally should be entitled to a federal income tax deduction at the time and for the same amount as the award recipient recognizes ordinary income.

A participant who is a teammate will be subject to withholding for federal, and generally for state and local, income taxes at the time he or she recognizes income under the rules described above. The tax basis in the Common Stock received by a participant will equal the amount recognized by the participant as compensation income under the rules described in the preceding paragraph, and the participant’s capital gains holding period in those shares will commence on the later of the date the shares are received or the restrictions lapse. Subject to the discussion below under “Tax Consequences to the Company,” we will be entitled to a deduction for federal income tax purposes that corresponds as to timing and amount with the compensation income recognized by a participant under the foregoing rules.

Tax Consequences to the Company

Reasonable Compensation

For the amounts described above to be fileddeductible by the Company, such amounts must constitute reasonable compensation for services rendered or to be rendered and must be ordinary and necessary business expenses.

Golden Parachute Payments

The Company’s ability (or the ability of one of our directorssubsidiaries) to obtain a deduction for future payments under the Amended 2023 Plan could also be limited by the golden parachute rules of Section 280G of the Code, which prevent the deductibility of certain excess parachute payments made in connection with a change in control of an employer-corporation.

Compensation of Covered Employees

Our ability to obtain a deduction for amounts paid under the Amended 2023 Plan could be limited by Section 162(m) of the Code. Section 162(m) of the Code limits our ability to deduct compensation, for federal income tax purposes, paid during any year to a “covered employee” (within the meaning of Section 162(m) of the Code) in excess of $1,000,000.

New Plan Benefits

Grants under the Amended 2023 Plan will be made at the discretion of the Committee, and therefore, the benefits or number of shares subject to awards that may be granted in the future to our executive officers, under Section 16(a)teammates and non-employee directors is not currently determinable. Therefore, a New Plan Benefits Table is not provided.

Equity Compensation Plan Information

The information regarding plans and other arrangements required by Item 10(c) of Schedule 14a can be found below in the section entitled “Equity Compensation Plan Information”.

Vote Required for Approval

Approval of this Proposal 3 requires the affirmative vote of a majority of the Exchange Act were filedvotes cast on this proposal. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the results of this vote.

The Board of Directors recommends a timely basis during 2017, except invote FOR the following instances: (1) for Mr. P. Cody Phipps,approval of

Amendment No. 1 to the President, Chief Executive Officer and Chairman of the Company, an amendment to a timely filed Form 4 was filed to correct an administrative error in reporting the amount of securities acquired; (2) for Mr. M. Jay Romans, a former executive officer of the Company, an amendment to a timely filed Form 4 was filed to correct an administrative error in reporting the amount of securities acquired; (3) for Ms. Barbara B. Hill and Mr. Lemuel E. Lewis, directors of the Company, Form 4s were inadvertently filed late to report the acquisition of phantom stock, derivative securities beneficially owned through the Company’s Directors’ Deferred CompensationOwens & Minor, Inc. 2023 Omnibus Incentive Plan.

38Owens & Minor, Inc.2024 Proxy Statement


Stock Ownership Information

Stock Ownership by Management and the Board of Directors

The following table shows, as of March 13, 2018,14, 2024, the number of shares of Common Stock beneficially owned by each director and director nominee, the executive officers identified as our “NEOs” in the Summary Compensation Table in this Proxy Statement and all current directors and executive officers of the Company as a group.

 

Name of

Beneficial Owner

Sole Voting and Investment

Power (1)

Other (2)Aggregate
Percentage
Owned

Stuart M. Essig

 27,847  —   *

John W. Gerdelman

 24,190  —   *

Barbara B. Hill

 6,506  —   *

Lemuel E. Lewis

 39,579  —   *

Martha H. Marsh

 16,065  —   *

Mark F. McGettrick

 1,397  —   *

Eddie N. Moore, Jr.

 28,688  —   *

James E. Rogers

 58,991  —   *

David S. Simmons

 14,102  —   *

Robert C. Sledd

 22,901  —   *

Anne Marie Whittemore

 74,316  —   *

P. Cody Phipps

 396,484  —   *

Richard A. Meier

 127,158  —   *

Stuart Morris-Hipkins

 62,061 

Charles C. Colpo

 43,944  —   *

Rony C. Kordahi

 48,160  —   *

All Executive Officers and Directors as a group (21 persons)

 1,274,493  —   2.04%
     

Name of

Beneficial Owner

    

Sole Voting and Investment

Power(1)

 Other(2)  

Aggregate

Percentage
Owned

   

Mark A. Beck(3)

 

 

 

9,344   

 

 

— 

 

 

   *   

   

Gwendolyn M. Bingham

 

 

 

22,184   

 

 

— 

 

 

   *   

   

Kenneth Gardner-Smith

 

 

 

14,854   

 

 

— 

 

 

   *   

   

Robert J. Henkel(3)

 

 

 

37,344   

 

 

— 

 

 

   *   

   

Rita F. Johnson-Mills

 

 

 

14,057   

 

 

— 

 

 

   *   

   

Stephen W. Klemash

 

 

 

18,983   

 

 

— 

 

 

   *   

   

Teresa L. Kline

 

     

 

14,057   

 

 

— 

 

 

   *   

   

Edward A. Pesicka

 

 

 

857,796   

 

 

— 

 

 

1.12%   

   

Carissa L. Rollins

 

 

 

13,834   

 

 

— 

 

 

   *   

   

Perry A. Bernocchi

 

 

 

209,537   

 

 

— 

 

 

   *   

   

Alexander J. Bruni

 

 

 

65,808   

 

 

— 

 

 

   *   

   

Andrew G. Long

 

 

 

272,565   

 

 

115,555 

 

   *   

   

Daniel J. Starck

 

 

 

105,058   

 

 

— 

 

 

   *   

   

All Executive Officers and Directors as a group (16 persons)

  

 

 

1,891,169   

  

 

 

 

 

 

 

2.62%   

* Represents less than 1% of the total number of shares outstanding.

*

Represents less than 1% of the total number of shares outstanding.

(1) No officer or director of the Company has the right to acquire any shares through the exercise of stock options within 60 days following March 13, 2018.

(1)

No officer or director of the Company has the right to acquire any shares through the exercise of stock options within 60 days following March 14, 2024. There are no outstanding options, warrants or rights as of December 31, 2023.

(2)

Includes: (a) shares held by certain relatives or in estates; (b) shares held in various fiduciary capacities; and (c) shares for which the shareholder has shared power to dispose or to direct disposition. These shares may be deemed to be beneficially owned under the rules and regulations of the SEC, but the inclusion of such shares in the table does not constitute an admission of beneficial ownership.

(3)

The following directors hold shares in the Common Stock account of the Directors’ Deferred Compensation Plan: Mr. Beck 49,343 shares; Ms. Bingham 9,344 shares; and Mr. Henkel 48,074 shares.

(2) Includes: (a) shares held by certain relatives or in estates; (b) shares held in various fiduciary capacities; and (c) shares for which the shareholder has shared power to dispose or to direct disposition. These shares may be deemed to be beneficially owned under the rules and regulations of the SEC, but the inclusion of such shares in the table does not constitute an admission of beneficial ownership.

Stock Ownership by Certain Shareholders

The following table shows, as of March 13, 2018,14, 2024, any person (including any “group” as that term is used in Section 13(d)(3) of the Exchange Act) who, to our knowledge, was the beneficial owner of more than 5% of theour Common Stock.

 

Name and Address of Beneficial Owner

Shares Beneficially Owned

Percentage Owned

BlackRock, Inc.

55 East 52nd Street,50 Hudson Yards, New York, NY 1005510001

6,672,191(1) 10.7912,273,657(1)%16.02%   

FMR LLC

245 Summer Street, Boston, MA 02210

10,431,010(2)13.62%   

The Vanguard Group Inc.

100 Vanguard Blvd., Malvern, PA 19355

8,587,684(3)5,734,515(2) 9.2811.21%   
%

Deerfield Partners, L.P.

345 Park Avenue South, 12th Floor, New York, NY 10010

5,229,779(4)6.83%   

Dimensional Fund Advisors LP

Building One, 6300 Bee Cave Road, Building One, Austin, TexasTX 78746

4,211,031(5)3,747,234(3) 6.06%5.50%   

(1)

(1)

Based upon a Schedule 13G report or amendment filed by BlackRock Inc. with the SEC on January 22, 2024.

Owens & Minor, Inc. with the SEC on January 19, 2018.2024 Proxy Statement39

(2) Based upon a Schedule 13G report or amendment filed by Vanguard Group, Inc. with the SEC on February 9, 2018.


 Stock Ownership Information 

(3) Based upon a Schedule 13G report or amendment filed by Dimensional Fund Advisers LP with the SEC on February 9, 2018.

(2)

Based upon a Schedule 13G report or amendment filed by FMR LLC with the SEC on February 9, 2024.

(3)

Based upon a Schedule 13G report or amendment filed by Vanguard Group, Inc. with the SEC on February 13, 2024.

(4)

Based upon a Schedule 13G report or amendment filed by Deerfield Partners, L.P. with the SEC on February 12, 2024.

(5)

Based upon a Schedule 13G report or amendment filed by Dimensional Fund Advisors LP with the SEC on February 9, 2024.

Equity Compensation Plan Information

The following table shows, as of December 31, 2017,2023, information with respect to compensation plans under which shares of Common Stock are authorized for issuance.

 

 
Plan Category

(a)

Number of securities to 

be issued upon exercise 

of outstanding options, 

warrants and rights (1) 

(b)

Weighted-average exercise

price of outstanding options,

warrants and rights (1)

(c)

Number of securities
remaining available for future
issuance under equity
compensation plans
(excluding securities reflected
in column (a))

 

(a)

Number of securities to

be issued upon exercise

of outstanding options,

warrants and
rights
(1)

 

(b)

Weighted-average exercise

price of outstanding options,

warrants and rights(1)

 

(c)

Number of securities
 remaining available for future 

issuance under equity
compensation plans
(excluding securities reflected
in column (a))

 

Equity compensation plans approved by shareholders (2)

360,556  1,292,281 866,989  4,051,626(3)

Equity compensation plans not approved by shareholders (3)

  —      
 

Equity compensation plans not approved by shareholders(4)

   
 

Total

360,556  1,292,281 866,989  4,051,626

(1) There are no outstanding options, warrants or rights as of December 31, 2017. The total in column (a) above relate

(1)

There are no outstanding options, warrants or rights as of December 31, 2023. The total in column (a) above relates to performance shares.

(2)

These equity compensation plans are the 2023 Omnibus Incentive Plan adopted and approved by shareholders on May 11, 2023, and the 2018 Stock Incentive Plan (the “2018 Plan”) adopted and approved by shareholders on May 8, 2018 (as amended May 10, 2019 and May 1, 2020). No additional awards may be made under the 2018 Plan. The Company assumed shares from the Apria, Inc. 2021 Omnibus Incentive Plan (the “Apria Plan”) that became available as of March 29, 2022 under the 2018 Plan.

(3)

Includes 3,216,759 shares of Common Stock that were assumed from the Apria Plan under the 2018 Plan pursuant to an exception under Section 303A.08 of the NYSE Listed Company Manual that remain subject to the terms and conditions set forth in such exception.

(4)

The Company does not have any equity compensation plans that have not been approved by shareholders.

(2) These equity compensation plans are the 2015 Stock Incentive Plan adopted40Owens & Minor, Inc.2024 Proxy Statement


Executive Compensation

A Message from Our People & Culture Committee

The Our People & Culture (“OP&C”) Committee of the Board of Directors oversees Owens & Minor’s executive compensation philosophy and reviews and approves compensation programs, opportunities, and awards for our named executive officers (“NEOs”). While Owens & Minor management and our independent compensation consultant provide input to the OP&C Committee, it is the sole responsibility of the OP&C Committee to approve our executive compensation philosophy, plans, policies, programs, and decisions.

The OP&C Committee also oversees programs relating to the culture of the Company, and, during 2023, was engaged with executive leadership in the evolution of the Company’s corporate culture through the introduction of our Purpose and Vision, which is vital to our continued growth and long term success.

Guided by our executive leadership team, we delivered on our commitments in 2023 and closed an outstanding year. Our Patient Direct segment continued to outperform the market and continues to position itself as a leader amid healthy demand for home-based care. Likewise, our Products & Healthcare Services (“P&HS”) segment overachieved in both revenue and adjusted operating income as compared to our expectations, which resulted from our intense focus on and execution of our strategic initiatives.

In 2023, the OP&C Committee approved annual equity award grants to executive management in a mix of 50% time-based restricted stock units (“RSUs”) vesting over a three-year period and 50% performance share units (“PSUs”). The 2023 PSU grant design consists of a three-year performance period and the PSU metric is three-year cumulative adjusted EPS; also included in the grant design is a relative total shareholder return (“TSR”) modifier to further enhance alignment of our executives with shareholder returns as compared to that of other comparable companies in the performance index. PSUs can be earned in an amount ranging from 0% to 200% of target.

We strengthened our leadership talent during the year by appointing Perry Bernocchi as our Executive Vice President, CEO of Patient Direct, our segment that includes both the Byram and Apria divisions.

A key focus area in 2023 was the company-wide Operating Model Realignment (“OMR”) Program. The OMR Program was a broad-based effort to evaluate and improve our business, which was led by a dedicated team committed to accelerating profit improvement and reducing costs. The OP&C Committee will continue to evaluate our compensation and governance practices to support the objectives of the business (including ongoing Operating Model improvements), align with our compensation philosophy and prevailing market practices, and provide incentives to deliver key financial metrics that are directly linked to value creation for our shareholders. We are committed to ensuring that our executive compensation programs evolve as necessary to support our business strategy and organizational structure.

More details are provided on the following pages, and we look forward to getting shareholder feedback in the future. Thank you for your continued engagement.

The Our People & Culture Committee

Robert J. Henkel, Chair

Mark A. Beck

Kenneth Gardner-Smith

Owens & Minor, Inc.2024 Proxy Statement41


 Executive Compensation 

Compensation Discussion and approved by shareholders on April 30, 2015 and the 2005 Stock Incentive Plan. No additional awards may be made under the 2005 Stock Incentive Plan.

(3) The Company does not have any equity compensation plans that have not been approved by shareholders.

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSISAnalysis

This Compensation Discussion and Analysis (“CD&A”) describes our executive compensation philosophy and programs, the role of our OP&C Committee and its independent consultant, the compensation decisions made by the CompensationOP&C Committee under these programs and the considerations that went into our decisions in lightas a result of the Company’s operational and financial performance in 2017.

Our fiscal year 2017 named executive officers (“NEOs”) are:2023, all as they relate to our NEOs.

 

 Our Executive Compensation Philosophy

Our executive compensation programs are designed to reflect a pay-for-performance philosophy that aligns with the business’s strategy and goals, both short and long-term, and pays for sustained performance, profitable growth, and achievement of results. We generally target the 50th percentile of our peer group and the relevant market as a reference point for positioning target total compensation for our executives1,with the ability to earn above or below the 50th percentile based on Company and/or individual performance. Key considerations when determining an executive’s compensation include experience, size and scope of role, pay position relative to the market, internal equity, and talent retention.

We designed our executive compensation program framework to reward for Company and individual performance, with a focus on the following objectives:

   Reasonable but market-competitive base salaries to attract, motivate, and retain executives.

   Appropriate balance between short- and long-term incentives and fixed and at-risk incentive compensation, to weigh cost against expected benefit and to align with the creation of shareholder value, including:

   Annual cash incentives to drive critical business results each year; and

   Long-term equity awards to retain management and incentivize executives to focus on longer-term financial performance and execution of our operational and strategic plans.

   Retirement, severance, and other market-competitive benefits to attract executive talent and encourage retention.

1   This is a reference point, not a policy, and actual compensation may be above or below the target level based on Company and/or individual performance.

2023 CD&A At-a-Glance

The following section identifies our NEOs for 2023, highlights our performance for the year, and discusses considerations in the resulting compensation approved by the OP&C Committee. We believe the OP&C Committee’s actions in 2023 and outcomes of the 2023 incentive programs were in-line with the Company’s compensation philosophy. Further, we believe the 2023 pay results illustrate and emphasize the strong link between executive pay and the actual results of our Company.

2023 Named Executive Officers

  Named Executive Officer Title
P. Cody PhippsRole Chairman, 2023 Time in Role
 Edward A. PesickaPresident &and Chief Executive Officer (CEO)Full Year
Richard A. Meier
 Alexander J. Bruni Executive Vice President & Chief Financial Officer & President, International(CFO)Full Year
Stuart Morris-Hipkins*
 Andrew G. Long Executive Vice President, Global ManufacturerCEO, Products & Healthcare Services
Charles C. Colpo** Senior Vice President, Strategic Supplier ManagementFull Year
Rony C. Kordahi
 Perry A. Bernocchi1 

President & CEO, Byram Healthcare

Executive Vice President, North American OperationsCEO, Patient Direct

*Mr. Morris-Hipkins joined the Company effective March 13, 2017 as its Executive Vice President, Manufacturing Services, and was promoted to President, Global Solutions on January 3, 2018.

**Mr. Colpo became Senior Vice President, Strategic Supplier Management on November 26, 2017, having previously served as Senior Vice President, Europe Operations.

Executive Summary

2017 Business Transformation, Performance and Compensation Review

2017 was a year of strategic transformation for Owens & Minor in an effort to strengthen our core Domestic distribution and logistics business and to reposition the Company for future success as a global healthcare solutions company. At the outset of 2017, the Company recognized that its core Domestic distribution and logistics business was under margin and competitive pressures as a result of market dynamics and vertically integrated competitors bundling and subsidizing distribution with product margins. The business was also being impacted by thede-leveraging effect of the loss of a large customer in 2016.

To combat these pressures, the Board and executive management resolved to:

 1)

January – February

March—December

Reduce expenses, increase efficiency and productivity and add significant operating income (to replace lost margin) through a “rapid business transition” or “RBT” process,
 Daniel J. Starck2

Executive Vice President, President – Patient Direct & CEO of Apria, Inc.

Executive Vice President, Business Excellence

January – February

March—December

 

12)Advance

Mr. Bernocchi was appointed Executive Vice President, CEO, Patient Direct effective March 1, 2023. Prior to that, Mr. Bernocchi served as President & CEO of the Company’s previously stated four-part strategy, andByram Healthcare division, a position he held from 2009 to March 2023.

 

23)Diversify the Company and its revenue/earnings profile into higher margin businesses through strategic transformational acquisitions

Mr. Starck was appointed Executive Vice President, Business Excellence effective March 1, 2023. Prior to that would further advance the Company’s strategy.Mr. Starck served as Executive Vice President, President – Patient Direct & CEO of Apria, Inc. from March 2022 to February 2023.

Recognizing the competitive pressures in the Domestic segment earnings (which makes up the vast majority of the Company’s revenue and operating earnings), in February 2017 the Compensation Committee approved the Company’s 2017 Annual Incentive Plan (“2017 AIP”) for our NEOs that would:

42Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

 

Reduce potential payouts compared to fiscal 2016 for performance at or below the Board-approved annual operating plan (“AOP”) such that reaching 100% of 2017 AOP target would result in 75% AIP performance; and

Further incentivize AOP outperformance with steeper leverage for potential payouts above target (as further discussed on page 43).”

2017 Financial and Operational Performance

In 2017, the Company made significant progress on each of the three items above to advance the Company’s business transformation:

1)The Company outperformed the RBT financial goals and successfully added in excess of $50 million operating earnings through cost reductions and operational improvements to partially offset margin compression and further identified an additional approximately $150 million of totalrun-rate earnings deliverable by 2020;

 

2)The Company made significant qualitative progress against its previously announced four-part strategy, highlighted below. The strategic transformation is a multi-year process and there is still progress to be made, as

2023 Business Highlights

Even in the face of challenges, the Company will continueachieved strong cash flow and Adjusted Operating Income1 in 2023 and continued to pursue eachbuild on our culture as well as focus on DE&I. Highlights for 2023 include:

Income

   Generated Revenue of $10.3 billion in 2023

   Achieved Adjusted Operating Income1 of $305 million in 2023 including over $40 million of benefit from the four strategies.OMR Program

   Achieved Adjusted EBITDA1 of $526 million in 2023

   Adjusted net income per common share1 of $1.36

Balance Sheet and Cash Flows

   Reduced total debt by $403 million and reduced net debt1 by $577 million in 2023

   Generated $741 million of operating cash flow in 2023

Business Achievements

   Launched our purpose: Life Takes Care – capturing the company’s unique approach to caring for both the business and the humanity at the heart of healthcare

   Unveiled Vision 2028, our five-year strategic plan to drive growth and profitability

   Our Byram Healthcare division was awarded Verywell Health’s “Best Overall Diabetic Supply Company” for the fourth year in a row

   The Owens & Minor Foundation named Ronald McDonald House Charities© its flagship charity partner and our teammates have supported more than 1,800 RMHC families through over 1,000 hours of volunteer time

Strategy2017  Accomplishment
Build the Most Efficient Route to MarketThe Company reduced operating expenses and made investments in capabilities (such asvoice-to-pick technologies); however, the Company did not fully attain its productivity goals for 2017.
Expand along the Continuum of Care (COC)The Company acquired Byram Healthcare, greatly expanding its capabilities and platform along the COC. Additionally, the Company added an ambulatory surgery center customer with over 200 sites of care, further diversifying away from the acute setting to alternative points of care.
Become the Preferred Outsourcer to ManufacturersThe Company added strategic orthopedic product manufacturer customers, further leveraging its distribution network to provide outsourced supply-chain and logistics services to manufactures for their clinically relevant products; however, the Company did not fully meet its revenue and margin goals for this business unit in 2017.
Data Analytics & ServicesThe Company made investments in its QSightTM inventory management platform and reorganized and enhanced its selling capabilities for QSightTM and its other technology and service solutions. Despite these investments, the Company did not fully meet its existing customer penetration goals in 2017 with respect to its value-added and service solutions.

3)The Company made significant progress in transforming its earnings and revenue profile to higher-margin businesses through two strategic acquisitions:

The Company completed its acquisition of Byram Healthcare, the second largest U.S. home health distributor, on August 1, 2017, advancing its strategy to expand along the continuum of care; and

On November 1, 2017, the Company announced its pending $710 million acquisition of Halyard Health’s Surgical & Infection Protection (“S&IP”) business (anticipated to close early in the second quarter of 2018). The Company expects this acquisition to provide the Company with market-leading brands in certain product categories, the ability to have owned-brand products in excess of 10% of sales, and a scalable global manufacturing platform to leverage for future growth.

2017 Compensation Decisions

The Compensation Committee took the following significant compensation actions in 2017:

No NEO salaries were increased for 2017;

The 2017 AIP for our NEOs was designed so that NEOs would only earn 75% of target bonus opportunities for performance at the 100% level of the Board-approved AOP; and

Long-term incentives provided an additional opportunity that would only be earned if Company performance in 2019 returns to previously stated adjusted earnings per share growth goals.

In 2017, the Company and the NEOs successfully performed against a portion of the Company’s objectives, making significant progress on its business transformation while not meeting the target performance of adjusted operating earnings. The Company achieved annual GAAP earnings of $1.20 per share and adjusted earnings of $1.61 per share for 2017, with consolidated operating earnings of $89.3 million and adjusted consolidated operating earnings of $180 million. For the purposes of determining financial performance for the 2017 AIP, adjusted operating earnings was $166 million which was below the 2017 AOP target of $204 million but above threshold of $163.2 million.1.

We believe our 2017 compensation results are consistent with our 2017 operating performance and that the incentive awards earned by our executive officers reflected our performance and the performance of our NEOs in 2017.

2017 adjusted operating earnings performance resulted in NEOs earning a 37% of target payout for the financial component of the 2017 AIP (weighted 80% of the overall plan); and

The Compensation Committee exercised negative discretion on the individual Qualitative Performance Factor (“QPF”) component of the 2017 AIP (weighted 20% of the overall plan) for Messrs. Phipps, Meier, Colpo and Kordahi for failure to meet certain financial and operational goals (as further described on page 46).

Summary of 2017 Compensation Actions and Performance Pay Results

Our 2017 Annual Incentive Program (AIP) was structured as follows:

LOGOComponents

 

Short-Term

Compensation

Cash

  Base salary

  Annual Incentive Plan (AIP)

Long-Term

Compensation

Equity

  Stock Incentive Plan2

  50% restricted stock units (RSUs)

  50% performance stock units (PSUs), with relative TSR modifier

Other

  Retirement Savings (401(k)) & Executive Deferred Compensation & Retirement Plan

  Health & Welfare benefits

  Termination-related pay

We base a significant portion of compensation on the achievement of objective financial measures to create a strong link between pay and performance. We have no specific policies on the percentage of total compensation that should be “performance-based,” but consider this relationship in determining the overall balance and reasonableness of the executives’ total direct compensation packages. In 2023, our President & CEO’s total target compensation was 87% performance-based and 13% fixed, and our other NEOs’ total target compensation was 81% performance-based and 19% fixed.

1 

Adjusted (non-GAAP) earningsOperating Income (“AOI”), Adjusted EBITDA, and other non-GAAP financial measures included in this Proxy Statement and a reconciliation to itsthe most comparable GAAP equivalent financial measure are described on page 17 ofin the Company’s AnnualCurrent Report on Form 8-K filed with the SEC on February 20, 2024.

2

On May 11, 2023, our shareholders approved the 2023 Omnibus Incentive Plan, replacing the 2018 Stock Incentive Plan.

Owens & Minor, Inc.2024 Proxy Statement43


 Executive Compensation 

Because the successful operation of our business requires near-term execution and a long-term approach, our executive compensation program is designed to enhance both short- and long-term performance. We consider the relationship of short-term to long-term compensation in determining the overall balance and reasonableness of our executives’ total direct compensation packages. We believe that short-term compensation is a necessary complement to long-term compensation to provide remuneration for the attainment of near-term goals that ultimately lead to the achievement of our long-term objectives and strategic initiatives. In 2023, our President & CEO’s total target compensation consisted of 69% long-term and 31% short-term compensation, and our other NEOs’ total target compensation consisted of 63% long-term and 37% short-term compensation.

LOGOLOGO

We believe our proportionate mix of compensation opportunities is appropriate in that we provide a slightly greater relative percentage of incentive-based compensation tied to financial performance and long-term objectives to the CEO versus other NEOs because the CEO is able to more directly impact financial results and the creation of long-term shareholder value.

Performance Goals and Results

TargetActual1Achievement

2023 AIP

(Paid in March 2024)

2023 Revenue (20%)

2023 AOI (60%)

OMR Program AOI Benefit (20%)

$10,346.0 million
$325.0 million
$30.0 million

$10,337.6 million
$315.4 million
2
$40.0+ million

98%
68%
200%

1

Shown on a constant currency basis. Revenue was $10,334 million for the year-ended December 31, 2023 and was unfavorably impacted by foreign currency of $3.7 million based on foreign currency rates as of December 31, 2022 and AOI was $304.7 million for the year-ended December 31, 2023 and was unfavorably impacted by foreign currency of $4.3 million based on foreign currency rates as of December 31, 2023. Adjusted Operating Income (non-GAAP), or AOI, and other non-GAAP financial measures included in this Proxy Statement and a reconciliation to the most comparable GAAP equivalent financial measure are described in the Company’s Current Report on Form 10-K for the year ended December 31, 2017,8-K filed with the SEC on February 23, 2018. 20, 2024.

2

In 2017,determining achievement of the AOI performance metric under the 2023 AIP, the OP&C Committee considered a portion (approximately $6.4 million) of the costs associated with the closingCompany’s accounts receivable sales program for 2023, which reduced our 2023 AOI but were not contemplated when the OP&C Committee established the original target performance levels. The actual AIP achievement for 2023 AOI would have been approximately 82% had those costs been excluded, resulting in total funding of 109% of target. Accordingly, the actual 2023 AOI metric used for calculating the 2023 AIP achievement is different from the 2023 AOI used for other purposes.

Say-on-Pay Voting History

2021

 

98%

2022

 

96%

2023

 

97%

Learn more about recent shareholder input on compensation on page 48.

44Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

Summary of Our 2023 Decisions

The OP&C Committee makes decisions regarding NEO total compensation (base salary, annual bonus objectives and payments, and annual equity grants) in connection with our annual performance review process. The table below summarizes the OP&C Committee’s considerations and their decisions for 2023.

Factors That Guided Compensation Decisions

   Executive compensation philosophy

   Degree of achievement of key strategic financial and operational goals for 2022 (for base salary, annual bonus payments and equity grant decisions made in early 2023) and for 2023 (for base salary, annual bonus payments and equity grant decisions made in early 2024)

   Recommendations of our President and CEO (other than with respect to his own compensation)

   Advice of an independent compensation consultant

   Shareholder input

   Market pay practices

   Current and historical Owens & Minor compensation

2023 Compensation  Program Changes

Annual Incentive Plan: A third financial metric was added to the Annual Incentive Plan, OMR Program AOI benefit. This metric was intended to accelerate profit improvement and reduce costs. The OMR Program AOI benefit had a weighting of 20%. Adjusted AOI remained a metric with an increased weighting at 60%, and Revenue remained as well, with a reduced weighting of 20%. There were no other changes to the compensation program for our NEOs in 2023.

Key 2023
Compensation Decisions

Base Salary Decisions

Effective March 1, 2023, Mr. Bernocchi’s base salary increased 16% to $570,000 when he was appointed Executive Vice President, Chief Executive Officer, Patient Direct. Mr. Bernocchi replaced Mr. Starck who, also in March 2023, assumed the role of Executive Vice President, Business Excellence. There were no other base salary adjustments for our NEOs in 2023.

Annual Incentive Plan Decisions

As a result of business performance as summarized herein in 2023, the overall annual bonus pool was funded at 100% of the Byram Healthcare acquisition,target performance level. The NEOs were awarded annual bonus payments of approximately 100% of their individual target opportunities and were paid in March 2024. Mr. Pesicka’s target annual bonus opportunity increased from 130% of base salary to 145% and Mr. Bernocchi’s target annual bonus opportunity increased from 70% of base salary to 90%. Both increases better align these NEOs’ target annual bonus opportunities to the 50th percentile of the market.

Equity Grant Decisions

In 2023, the Company adopted a revised non-GAAP financial presentationgranted RSUs and PSUs to the NEOs that excludes amortizationcan be earned in an amount ranging from 0% to 200% of acquisition-related intangible assets in addition to items otherwise excluded. The 2017 AIP targets were approved prior to this accounting change and therefore amortizationthe number of acquisition-related intangible assets was not excluded byawarded shares based on the Compensation Committee for the purposes of determining financialCompany’s adjusted EPS performance for the 2017 AIP.three-year period from January 1, 2023 through December 31, 2025, and modified based on relative TSR as measured against performance of the Russell 3000 Medical Equipment and Services Sector Index.

In addition to his annual award, Mr. Long received a one-time equity award with a grant value of $1,000,000 in March 2023 in recognition of his recent appointment as CEO, Products & Healthcare Services in October of 2022. This award was delivered in RSUs.

2017 Annual Incentive Results

 

Owens & Minor, Inc.2024 Proxy Statement45


 Executive Compensation 

Adjusted Operating Earnings was $166 million, equating to 37% attainment

Aligning Pay with Performance

In 2023, our executive compensation structure consisted of the Annual Operating Earnings goal under the 2017 AIP for our NEOs.

Qualitative Performance Factor results varied for individual NEOsthree primary components: base salary, annual cash incentives and long-term incentives. We emphasize variable pay rather than fixed pay, with target opportunities based on performance againstpre-determined goals. After its review of each individual NEO’s performance,market practices and payments based on performance. Further, the Compensation Committee exercised negative discretion with respect to Messrs. Phipps, Meier, Colpo and Kordahi for failure to meet certain financial and operational goals (as discussed on page 46).

2017 AIP payouts ranged from 33% to 37% of target for our NEOs.

Our 2017 Long-Term Incentive (LTI) program was structured as follows:

LOGO

Results for 2016 Performance Share Grant (FY 2016 and FY 2017 performance period):

The Company did not achieve its LTI goals and therefore there was no payout on 2016-2017 LTI and all performance shares related thereto did not vest and were forfeited.

Return on Invested Capital (ROIC) was less than 9% against a goal of 10% (and threshold of 9%).

Adjusted Diluted Earnings per Share was $1.49 against a target of $2.12 (and threshold of $1.90).

Transformational Performance-Based Retention Equity Award

While the Compensation Committee lowered the 2017 AIP target bonus opportunity for achieving target AOP performance, the Compensation Committee wanted to ensure that executives remain focused on translating the near-term investments and cost reductions into building a stronger Company long-term and delivering on the goals of the Company’s strategic transformation. Therefore, the Committee approved an additional performance-based LTI opportunity designed to deliver the Company’s transformational agenda and earnings goals through 2019. The value of the award at the time of grant equaledone-half of the recipient’s annual LTI award value. These awards caused a modest increase in the total compensation for Messrs. Phipps, Meier and Colpo for 2017 as compared to 2016 as set forth in the Summary Compensation Table on page 54. These awards, which are more fully described on page 48, are entirely performance-based and require stretch financial performance over a multi-year period in order to vest.

Owens & Minor’s Compensation Philosophy and Goals

The fundamental principle underlying Owens & Minor’s executive compensation program is that we pay for sustained performance, profitable growth and achievement of results. Our goal is to encourage high Company

and individual performance within a framework that allows us to attract, retain and motivate our executives. Componentsstructure of our executive compensation program are designed to createensures that as an executive’s scope of responsibility increases, a greater portion of his or her compensation comes from performance-based pay. For 2023, the appropriate balance between short- and long-term incentives and between fixed andat-risk compensation, to weigh cost against expected benefit and to align with the creation of shareholder value while providing market-competitive compensation packages that promote executive retention. Theseperformance-based components include:

Annual cash incentives to drive critical business goals for each year.

Restricted stock and performance share grants to retain management and focus executives on longer-term financial performance and execution of our operational and strategic plans.

Reasonable but market-competitive base salaries so executives are not motivated to take excessive risks.

Retirement, severance and other benefits to attract executive talent and encourage retention.

Risks of Compensation Program and Practices

With respect to our overall compensation programs, the Company periodically reviews our compensation policies and practices to ensure that they do not create risks that are reasonably likely to have a material adverse effect on the Company or encourage inappropriate risk-taking by executives. Additionally, the Compensation Committee and its independent Compensation Consultant, Semler Brossy Consulting Group, LLC (“Semler Brossy”) consider risks when designing new executive compensation programs, and Semler Brossy periodically provides an external review of the programs and features of our programs and corporate governance policies that help mitigate risk. In October 2017, management engaged in a formal compensation risk review and assessment process with input from Semler Brossy. Based on this review and assessments, we believe that our compensation programs do not create risks that are reasonably likely to have a material adverse effect on the Company or encourage our executives to take excessive or inappropriate risks for our business. Our compensation philosophy and practices continue to evolve into a more market-driven pay structure with a lower percentage of fixed pay and a higher percentage of variable and performance-based pay in order to enhance the program’s pay for performance orientation. Further discussion and disclosure of the Company’s compensation policies and practices are included in the pages following this Executive Summary.

Executive Compensation Practices

Our compensation programs and practices areprogram were designed to meet compensation best practices and to drive performance that creates long-term shareholder value.

WHAT WE DOas follows:

 

   

Short-term Incentive

 

Long-term Incentive

Annual BonusPerformance-based EquityTime-based Equity

Objective

Reward achievement of short-term (annual) corporate performance goalsReward long-term financial results and drive shareholder value creation

Reward long-term financial results and drive shareholder value creation

Reinforce ownership in the Company

Support retention of executives

Form

CashPSUs (50%)RSUs (50%)

Time Horizon

1 year3 years3 years

Metrics

Adjusted AOI (60% weighting)

Revenue growth (20% weighting)

OMR Program AOI Benefit (20% weighting)

Cumulative adjusted EPS

Relative TSR as a modifier

Continued employment

46Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

Compensation Factors and Governance

The OP&C Committee applies several corporate governance features related to executive compensation, which are summarized below. We believe that these mechanisms help to ensure the alignment of executive and shareholder interests.

 WHAT WE DO

LOGO

Pay for Performance. We link pay to performance and a significant portion of our executives’ potential total annual compensation, both cash and equity, is basedincentive-based on the achievement of objective, simple and transparent financial measures that are structureddesigned to enhance short-termshort- and long-term performance.

LOGO

  

Performance-Based Equity Awards. At least half of our annual equity award grants are performance sharesPSUs with multi-year performance requirements and an additional year of vesting on earned shares.requirements.

LOGO

  

Share Ownership Guidelines. We have established stock ownership guidelines for our officers, and all of our tenured NEOs meet or exceed the established ownership guidelines (Mr. Morris-Hipkins and Mr. Kordahi, who joinedguidelines. Newly appointed NEOs are in the Company in 2017 and 2016, respectively, have five years fromprocess of attaining the date of hire to meet the guidelines and currently are on track to do so).required ownership level.

LOGO

  

Limited Perquisites. We tieprovide limited perquisites to a legitimate business purpose and limit the value provided to executive officers.

LOGO

  Double-Triggered

Double-Trigger Change in Control Provisions. Equity vesting and severance payments and benefits based onresulting from a change in control are “double-trigger” and require a qualifying termination of employment following the change in control.

LOGO

  

Recoupment Policy. We have in placemaintain a recoupment policy to recover from ourall performance-based cash compensation and all equity-based compensation (including both time- and performance-vesting equity awards) paid to current and former executive officers and other senior executives compensation paidand teammates designated as subject to the policy under circumstances involving restatement of our financial statements due to misconduct.statements.

LOGO

  

Risk Mitigation. We seek to mitigate risks associated with compensation by establishing caps on incentive compensation, multiple performance targets for earning incentive compensation and ongoing processes to identify and manage risk. We do not believe our compensation program creates risks that are reasonably likely to have a material adverse impact on the Company, which we confirm annually through a risk assessment of incentive-based compensation.

LOGO

  

Independent Compensation Consulting Firm. The CompensationOP&C Committee receives advice about its compensation programs and practices from an independent consulting firm that provides no other services to the Company, and the Company is not aware of any conflicts of interest with respect to its work.

WHAT WE DON’T DO

 

 WHAT WE DON’T DO

LOGO

  

No Employment Agreements.    While we agreed to an employment term sheet upon the hiring of our new CEO in 2015, we We do not otherwise have employment agreements with our executive officers.

LOGO

  

No Hedging. We prohibit our executive officers and directors from hedging against the economic ownership of Company stock.

LOGO

  

No Pledging. We prohibit our executive officers from pledging Company stock.

LOGO

  

NoRe-pricing Repricing of Equity Awards. Our stock plans do not permit there-pricing repricing of equity awards.awards without shareholder approval.

LOGO

  

No TaxGross-Ups. We do not provide any taxgross-ups, including excise taxgross-ups on change in control severance payments and benefits.gross-ups.

Say-On-Pay Vote

In May 2017, our shareholders approved the compensation of our NEOs for 2016The OP&C Committee also considers several factors in oursay-on-pay advisory vote with over 94% of votes cast in support of the program. Based on this support, the Compensation Committee made no material changes to the core structuredesigning and philosophy behind our executiveimplementing compensation program in 2017 but continues to evaluate our pay programs and practices to ensure that theysetting pay for executives, which are both market competitive and equitable. At our upcoming 2018 Annual Meeting, our shareholders will provide an advisory vote to approve 2017 executive compensation, and theoutlined in detail below.

Market Compensation Committee will continue to consider results from these advisory votes in setting executive compensation.

The Process for Setting Executive Compensation

The Company’s executive compensation levels and programs are established, approved and administered by the Compensation Committee, which is currently composed of five independent directors. The Compensation Committee solicits the views of its independent outside consulting firm and senior management on incentive compensation and plan design issues.Survey Data. In addition to peer data, the Compensation Committee sets performance goals and evaluates the performance of our Chief Executive Officer on an annual basis jointly with the Governance & Nominating Committee, and the Chief Executive Officer sets performance goals and provides performance evaluations of our other executive officers and makes recommendations as to their compensation levels. Our Chief Executive Officer does not make recommendations to the Compensation Committee with respect to his compensation and does not participate in Committee meetings when his compensation is discussed.

Independent Advisor.    The Compensation Committee has the authority under its charter to retain independent consultants or advisors to assist it in gathering information and making decisions. Management may not engage any independent advisor retained by the Compensation Committee to perform services without the prior approval of the committee, and no such engagement by management was undertaken in 2017. The CompensationOP&C Committee also obtains informationconsiders broader survey data with a focus on executives within healthcare and assistance from the Company’s human resources and finance department in evaluating and making decisions on executive compensation.

The Compensation Committee continued to engage Semler Brossy in 2017 as its independent advisor to (1) provide recommendations in changes to our peer group; (2) provide guidance and advice in our search for new executive officers and the compensation package offered to those new leaders; (3) analyze competitive levels of each element of compensation and total compensation for each of the executive officers relative to our peer group and industry trends; (4) provide information regarding executive compensation trends and regulatory changes and developments; (5) provide input on annual and long-term incentive design; and (6) periodically assist in conducting a risk assessment of our compensation programs, policies and practices. The Compensation Committee has analyzed whether the work of Semler Brossy has raised any conflict of interest and has concluded that the work of our advisor, including the individuals employed by our advisor who provide consulting services to the committee, has not created any conflict of interest. The Compensation Committee also considered and confirmed the independence of legal advisors retained during 2017.

Factors Used to Determine Executive Compensation.    Consistent with past years, the Compensation Committee considered a variety of factors in making decisions regarding compensation for our NEOs in 2017. The primary factors were as follows:

Performance.    Our policy is to provide executive officers with compensation opportunities that are based upon Company performance and their contribution to Company performance.

Mix of Short-Term and Long-Term Compensation.    Because the successful operation of our business requires a long-term approach, one element of our executive compensation program is long-term compensation. Although we have never had specific policies on the percentage of total compensation that should be short-term versus long-term, we considered this relationship in determining the overall balance and reasonableness of our

executives’ total direct compensation packages. We believe that short-term compensation is necessary in conjunction with long-term compensation to provide remuneration for performance of the short-term goals or milestones that ultimately lead to achievement of our long-term objectives and strategic initiatives. In 2017, the Compensation Committee gave additional consideration to the Company’s transformational and strategic acquisition activities and the importance of incentivizing and retaining key leaders to deliver upon these long-term goals.

Mix of Performance-Based Compensation.    To create a strong link between pay and performance, a significant portion of compensation is based on the achievement of objective financial measures. We have no specific policies on the percentage of total compensation that should be “performance-based,” but consider this relationship in determining the overall balance and reasonableness of the executives’ total direct compensation packages.

Impact and Mix of Cash vs.Non-Cash Compensation.    We consider both the cost and the motivational value of the various components of compensation. Although we have no specific policies on the percentage of total compensation that should be “cash versus equity,” we consider this relationship in determining the overall balance and reasonableness of the executives’ total direct compensation packages.

Peer Group Comparisons.    Each year, we evaluate our compensation levels and programs through comparisons to available information for a group of peer companies selected by the Compensation Committee (“Peer Companies”) based in part on recommendations from and analyses prepared by our compensation advisors. This evaluation helps us to assess whether our level and mix of executive pay is competitive and reasonable when compared to certain industry standards.

In general, the Peer Companies were selected after consideration of the following factors:

Quantitative Factors:revenue, net income, total assets, and/or market capitalization

Qualitative Factors:business model (health care services, health care distribution and companies from other distribution industries) and geography

Our Peer Companies include a mix of health care distribution and companies from other distribution industries in order to capture companies of comparable business modelbenchmarking and size to us. Thesetting compensation.

Executive Summary Compensation Committee periodically reviews the peer group to ensure it remains appropriate and relevant as a market reference and modifies the peer group as necessary to reflect changes at Owens & Minor, among the peers or within the industry. Relative to the Quantitative Factors of the Peer Companies, Owens & Minor generally ranks between the 25th percentile and median of the group. The Peer Companies used for 2017 consisted of the following:

2017 Peer Companies

Anixter International

Synnex Corp.

C.H. Robinson Worldwide, Inc.

United Natural Foods, Inc.

Essendant Inc.

Univar, Inc.

Genuine Parts Company

WESCO International

Henry Schein, Inc.

VWR Corporation

J.B. Hunt Transport Services, Inc.

WestRock Co.

Patterson Companies, Inc.

Using the Peer Companies, Semler Brossy analyzed the compensation components and levels for the NEOs of the Peer Companies and prepared a comparison of 2017 target total direct compensation and each element thereof to reported information for the Peer Companies. The Compensation Committee also considered data from

a Towers Watson General Industry survey, using a survey cut incorporating a discount to Owens & Minor’s revenue in light of thelow-margin nature of the Company’s business relative to general industry companies. When the Compensation Committee reviews data from the Peer Companies, it considers the 50th percentile of the group as a reference point for positioning target total compensation. This is a reference point, not a policy, and actual compensation may be above or below the target level based on performance. Data from the Peer Companies is one of a number of factors considered by the Compensation Committee when determining each executive’s pay. Other factors considered during this process include, but are not limited to, the executive’s performance, internal equity of pay, general market competitiveness and whether or not the executive participates in thenow-frozen Company SERP program.

Tally Sheets.    We alsoStatements. To review total compensation levels for executive officers, at least annually through the use of tally sheetsOP&C Committee reviews executive summary compensation statements that quantify each element of direct and indirect compensation provided to individual executives and the portion of the executive’s total compensation represented by each element of compensation. This annual review of tally sheets also includes information on the value of executives’ outstanding equity awards, as well as an evaluation of the payments and benefits that would be paid to executive officers in the event of termination of employment, including retirement or following a change in control of the Company. While providing additional context to us in making compensation decisions, the information from the tally sheets regarding outstanding equity awards and termination payments and benefits generally does not affect our compensation decisions for the NEOs. This reflects our view that an executive’s compensation level should be based on the Company’s performance, the executive’s performance and the executive’s contribution to the Company’s performance.

Total Program Cost.Cost. We consider the cost (including aggregate share usage and dilution) of the various components of our compensation program in evaluating the overall balance and reasonableness of our executives’ total direct compensation packages.

Owens & Minor, Inc.2024 Proxy Statement47


 Executive Compensation 

Risk Considerations.Considerations. In setting executive compensation, the CompensationOP&C Committee reviewsstructures the various components of our program to consider whether they are appropriately structured to promote the achievement of our business goals without encouraging the taking of unnecessary risks. We believe that several elements of our program mitigate risks associated with performance-based compensation, including the following:

 

 

Limits on Incentive Compensation. Awards underCompensation. We cap our annual incentive program are cappedAIP awards at 200% of the executive’s target award to protect against excessive focus on short-term incentives, and the CompensationOP&C Committee has discretion to reduce awards based on factors it deems appropriate, including whether officers took unnecessary risks.

 

 

Performance Metrics.Metrics. We use a combination of financial performance metrics for our annual incentive programAIP that emphasizesemphasize profitable and disciplined growth and requiresrequire responsible and risk-based decision-making by our executives. We also use operational metrics and specific Management by Objectives (“MBO”s) to reward executives for appropriate decision-making and accomplishment of non-financial goals.

 

 

Performance Shares/PSUs/Long-Term Equity Awards.Awards. At least half of an executive’s annual equity compensation each year consists of performance sharesPSUs with atwo-year multi-year performance cycle and an additional year of service-based vesting, which focuses management on sustaining the Company’s longer-termlong-term performance. The other portion of an executive’s annual equity compensation each year consists of restricted stockRSU awards that vest over a period of at least three years and, accordingly, further encouragesencourage a focus on long-term performance.performance and support executive retention.

 

 

Share Ownership Guidelines.Guidelines. Our share ownership guidelines ensure that our executives have a substantial stake tied to long-term holdings in Owens & MinorCompany stock.

 

 

Recoupment Policy.Policy. Performance-based cash compensation and equity-based compensation (including both time- and performance-vesting equity compensationawards) granted or paid to our current and former executive officers isand other senior executives and employees as the O&PC Committee may from time to time designate are subject to recoupment under circumstances involving misconduct that results in a restatement of our financial statements.

Elements ofShareholder Input on Executive Compensation

In an effort to achieve the objectives identified above, our 2017 executive compensation framework consisted of the following elements as further described below:

 

ElementIn evaluating the design of our executive compensation and the compensation decisions for each of our NEOs, the OP&C Committee considers shareholder input, including the advisory “say-on-pay” vote at our annual meeting.  Description

In 2023, approximately 97% of the “say-on-pay” shareholder votes cast approved the compensation for our NEOs.

In 2023, approximately 97% of the votes cast approved the compensation for our NEOs. We believe that this support resulted largely from the improvements that we have made and continue to make to our executive compensation programs and the effect that they have had on the Company’s performance.

Owens & Minor held an Investor Day event in December and 78 unique investment firms participated either in-person or via webcast. During the event, key members of the management team presented the Company’s strategic vision, operating and growth strategies and multi-year financial targets. Additionally, members of the management team participated in four institutional investor conferences and held in-person or telephonic discussions with more than 100 individual firms. Key feedback included:

 Purpose

Understanding the primary drivers behind the macro-economic conditions and competitive landscape impacting the P&HS Segment and the outlook for both;

Base Salary Fixed cash

Acknowledgement of the strong organic growth and strong operational execution in the Patient Direct Segment and the outlook for future growth and margin expansion; and

 Provides

Recognition that the balance sheet strength of the Company improved throughout the year driven by exceptionally strong cash flow generation and debt reduction.

To strengthen our pay-for-performance culture, the OP&C Committee considered the feedback obtained from our investor outreach when making decisions relating to compensation for our NEOs for 2023.

48Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

Role of the OP&C Committee

The OP&C Committee establishes, approves, and administers the Company’s executive compensation programs. This process ensures that performance metrics are consistent with the financial, operational, and strategic goals set by the Board. The following table provides the steps the OP&C Committee follows to ensure the total compensation for our NEOs is competitive, appropriately tied to performance, and does not promote undue risk taking.

LOGO

Role of the Independent Compensation Consultant

The OP&C Committee has the authority under its charter to retain independent consultants to assist it in making decisions regarding compensation. In 2023, the OP&C Committee engaged Willis Towers Watson (“WTW”) as its independent consultant to, among other things:

Analyze competitiveness of each element of compensation and total compensation for each of the NEOs relative to our peer group and industry trends;

Provide information regarding executive compensation trends and regulatory changes and developments; and

Provide input on annual and long-term incentive design

Our consultant reports directly to the OP&C Committee, and, aside from its work with the OP&C Committee and Governance & Nominating Committee, performs no other work for the Company. The OP&C Committee has analyzed whether the work of WTW raised any conflict of interest and has concluded that the work of our advisors, including the individuals employed by our advisors who provide consulting services to the OP&C Committee, have not created, nor are they encumbered by, any conflict of interest. The OP&C Committee also considered and confirmed the independence of legal advisors retained by the OP&C Committee during 2023.

Owens & Minor, Inc.2024 Proxy Statement49


 Executive Compensation 

Risk Assessment in Compensation Programs

In December 2023, the OP&C Committee reviewed a risk assessment of our compensation policies and practices conducted by management. Management prepares both a top-down and bottom-up assessment and reviews findings with the Committee’s independent consultant, WTW. Based on this review, WTW determined that the Company’s compensation programs promote and reward prudent business judgment without encouraging undue risk. The risk assessment included a global inventory of incentive plans and programs and considered factors such as plan eligibility, the variety of plan metrics, threshold and maximum payments, and the mix of short- and long-term compensation. Based on the review, the OP&C Committee concluded that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company.

Role of the Executive Compensation Peer Group

Each year, we evaluate our compensation levels and programs through comparisons to available information for a fixed amountgroup of cash compensation to allowpeer companies selected by the OP&C Committee based in part on recommendations from and analyses prepared by the OP&C Committee’s independent consultant. This evaluation helps us to recruitassess whether our level and retain keymix of executive pay is competitive and reasonable when compared to certain industry standards.

The OP&C Committee periodically reviews the peer group to ensure it remains appropriate and relevant as a market reference and modifies the peer group as necessary to reflect changes at the Company, among the peers or within the industry. In 2023, the following primary considerations were evaluated when reviewing existing peers and developing recommendations:

Refine focus on distribution companies. Focus comparisons to health care distribution and/or broader distribution companies as relevant.

Recognize broader healthcare industry. The Company’s long-term focus on the growth of its Global Products and Patient Direct businesses increases the relevance of healthcare equipment/supplies companies, including from an executive talent market perspective.

Balance financials/size criteria. Ensure comparability of peer companies across a range of relevant financial criteria to ensure the Company is appropriately positioned relative to the peer group.

Owens & Minor is reasonably aligned with median revenues when compared to the peer group.

We generally target total compensation packages for NEOs to reflect the 50th percentile of our peer group of companies when financial and operational goals are achieved.

We design our total compensation packages to provide pay above or below the 50th percentile compared to our peer group when results exceed or do not meet financial and operational goals.

  

The 12 peer companies we used to inform 2023 compensation decisions are outlined below. Covetrus, Inc. was acquired in October 2022 and is no longer a publicly traded company; as a result, it was removed from our peer group in 2023.

2023 Peer Companies

Baxter International Inc.

ResMed Inc.

Boston Scientific Corporation

STERIS PLC

C.H. Robinson Worldwide, Inc.

TD SYNNEX Corporation

DENTSPLY SIRONA Inc.

WESCO International, Inc.

Henry Schein, Inc.

Quest Diagnostics Incorporated

Patterson Companies, Inc.

Zimmer Biomet Holdings, Inc

50Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

Elements of the Executive Compensation Program

Owens & Minor executive compensation consists of fixed pay and variable pay, including cash and non-cash components. The chart below summarizes the various elements of Owens & Minor’s executive compensation and their purpose:

 
Annual Incentives

Element

 Cash awarded annually for performance against adjusted operating earnings metrics and qualitative performance factorsObjective ToKey Features

Base Salary

Cash

Provide competitive fixed pay that is tied to the market and allows us to attract, retain, and motivate executives within the medical technology industry and broader market

   Reflects individual skills, experience, responsibilities, and performance over time

   Influences annual bonus opportunity

Short-Term Incentives

Cash

Encourage focus on short-term business performance and motivate executive officers’ performance in achieving our current-year business goals

   Performance-based reward tied to achievement of short-term corporate and individual performance goals

   Pays only if threshold performance levels are met or exceeded

  

Long-Term Incentives

Performance shares and restricted stock

•  Performance shares are earned if the Company achieves return on capital employed and adjusted diluted EPS metrics. Performance is measured over a2-year period and, if earned, shares vest at the end of 3 years from date of award.

•  Restricted stock vests 3 years from date of grant

•  For 2017, additional performance shares were awarded to the NEOs and certain other employees of the Company in order to incentivize and retain key leaders and high-performing teammates to deliver the Company’s transformational agenda and earnings goals through 2019.Equity

 Rewards performance that enhances shareholder value through the use ofusing equity-based awards that link compensation to the value of our Common Stock and the achievement of multi-year performance goals;goals, and strengthens the alignment of management and shareholder interests by creating meaningful levels of Company stock ownership by management
 

   Links value to stock price

   Composed of 50% PSUs and 50% RSUs

   PSUs are tied to achievement of long-term corporate performance goals; executives earn shares (ranging from 0% to 200% of target) if the Company meets certain operational, financial, or shareholder return metrics as selected by the OP&C Committee over a three-year period, also subject to a relative TSR modifier

   RSUs vest ratably over three years from date of grant

 

Retirement Savings & Deferred Compensation Plan

Officers may defer salary and cash bonuses into a plan that provides for investment options similar to the Company’s 401(k) plan.

Benefit

 Provides a tax efficient opportunity to save for retirement and to ensure that our executive compensation program remains competitive in the marketplace for key executive talent

   Executives may participate in the Company’s 401(k) Plan, and may defer salary and cash bonuses into an executive deferred compensation plan that provides for investment options similar to the Company’s 401(k) Plan

  

Retirement/Post-Termination Compensation

CompensationBenefit

Participation in Company’s 401(k) plan and matching contributions similar to other teammates. SERP (frozen as of March 2012) available to legacy NEOs only (see Summary Compensation Table, Note 3). Provides security for severance in the future needsevent of not-for-cause termination. Additionally, executives are parties to change in control agreements that provide “double-trigger” severance benefits in connection with a qualifying termination following a change in control

   Severance provisions to protect the executivesCompany and their familiesNEOs in the event of a termination without cause

NEO Employment Events

We believeIn March 2023, Mr. Starck became the Company’s Executive Vice President, Business Excellence, to lead the Company’s OMR Program. At that the elements of our executive compensation framework support short-term and long-term performance goals by providing our executive officers with an appropriate mix of compensation elements that include (1) fixed annual compensation, (2) target-based annual and long-term incentive compensation and (3) security for the future needstime, Mr. Bernocchi was promoted to Executive Vice President, CEO of the executives and their families inPatient Direct segment, succeeding Mr. Starck as head of the formPatient Direct segment.

Owens & Minor, Inc.2024 Proxy Statement51


 Executive Compensation 

Analysis of retirement and termination benefits.2023 Compensation Decisions

Base Salary

While we agreed to an employment term sheet upon the hiring of our new CEO in 2015, our executive officers are otherwise employed on an “at will” basis and without employment agreements. We review base salaries each April.

Inannually or in connection with promotion. The OP&C Committee generally considers the following factors when making base salary decisionsdecisions:

Individual attributes of each NEO (such as responsibilities, skills, leadership, and experience);

Individual and overall Company performance levels;

The officer’s expected future contributions to the Company; and

Overall market-competitiveness of the officer’s base salary.

2023 Base Salary Decisions

With the Compensation Committee generally considers:

(1) Individual attributesexception of each NEO (suchMr. Bernocchi, in consideration of his appointment as responsibilities, skills, leadership and experience),

(2) Individual and overall Company performance levels,

(3) The officer’s expected future contributions to the Company, and

(4) Overall market-competitiveness ofExecutive Vice President, CEO, Patient Direct, the officer’s base salary.

In 2017, the CompensationOP&C Committee did not approve salary increases for ourincrease base salaries of the NEOs and all NEO salaries were held at the 2016 level. In making this decision, the Compensation Committee gave significant weight to the Company’s expected financial performance level in 2017 and the fact that financial goals for 2017 were well-below actual financial performance delivered in 2016 due to expected margin pressures and competitive dynamics in our Domestic business.2023.

   

NEO

   2022 Salary     2023 Salary   Percent Change  
   

Edward A. Pesicka

 $1,000,000 $1,000,000 n/a
   

Alexander J. Bruni

 $  525,000 $  525,000 n/a
   

Andrew G. Long

 $  650,000 $  650,000 n/a
   

Perry A. Bernocchi

     n/a1 $  570,000 n/a
   

Daniel J. Starck

 $  650,000 $  650,000 n/a

1

Mr. Bernocchi became an NEO effective March 1, 2023.

Annual Performance-Based Cash Incentives

We provide annual performance-based cash incentive opportunities to executive officers to motivate their performance in achievingincentivize them to achieve our current-year business and financial goals. Each year, we establishthe Board approves an annual operating plan, or AOP, for that year that includes financial, strategic, and other goals, for the Company and that is approved by the Board of Directors. Annualwe base annual incentive goals for the executive officers are set based on the approved AOP. TheseThe goals are weightedinclude both Company performance and individual MBOs specific to reflect their relative importance and contributioneach executive. For 2023, the OP&C Committee again selected a blend of Company financial metrics to overall Company performance.assess our NEOs’ performance:

The performance metrics (“Performance Metrics”) established for determining the Target Payout Amount for the 2017 AIP were:

Company Adjusted Operating Earnings comprising 80% of the Performance Metric with the following targets:

 

Performance
Metrics
 Weighting  

Threshold (1)

35%2023 Revenue

 

Target (1)

75%2023 AOI

 

Maximum (1)

200%2023 OMR Program AOI Benefit

The OP&C Committee also structured our 2023 AIP to include MBOs as performance metrics that allow for a modifier of incentive compensation earned by the NEOs. The relative weighting of each of these metrics is set forth in the table below.

 

 

 

 

Corporate Performance

 

 

 

 

 Individual Performance
 
Measure Revenue  AOI OMR Program AOI Benefit modified by MBOs
 
Weighting 20%   60% 20%   +/- 35%

52Owens & Minor, Inc.2024 Proxy Statement


Adjusted Operating Earnings

80$163.2 million$204 million$244.8 million

 Executive Compensation 

 

A Qualitative Performance Factor, or QPF, (i.e., individual goals) comprising 20% of the Performance Metric

In addition, none of the foregoing Performance2023 Company Financial Metrics could result in a payout unless the Company achieved an adjusted operating earnings for 2017 of at least $130 million (the “Qualifier”).and Performance

The CompensationOP&C Committee selected Revenue, AOI and the Board of Directors approved, the Qualifier and each of the Performance Metrics, including the weights assigned to them and the target achievement levels in March 2017 based on discussions with and recommendations by senior management, the approved 2017 AOP, the growth and operational improvements called for in our strategic plan and transformational agenda, and consultations with Semler Brossy. The Committee selected Adjusted Operating EarningsOMR Program AOI benefit as the financial Performance Metricappropriate metrics for Company performance for a variety of reasons, including:

Each metric is applicable across our segments and to overall company performance;

The measurements are widely understood by our teammates and are the internal metrics of greatest focus throughout the year;

They are among the most important underlying drivers of business performance and other key financial metrics (such as adjusted EPS, operating cash flow, and return on invested capital);

These metrics are closely aligned with the creation of shareholder value as sustained AOI and revenue growth are both highly correlated with share price growth and are key drivers of cash flow, which is also highly correlated to equity value;

They are an important area of focus for our investor base and feature prominently in our investor communications; and

These metrics are in part driven by our NEOs’ performance to their respective MBOs.

In setting 2023 annual cash incentive plan because this metric:program goals, including Revenue, AOI, and OMR Program contributions, the OP&C Committee considered the following:

 

is a common metric to all of our business units,

2022 full-year revenue and AOI performance;

 

2023 first quarter revenue and AOI performance and the trajectory of the Company’s business at that time;

is widely understood by our teammates

Inflation and macroeconomic factors in the first quarter of 2023;

Infrastructure, technology, and other investments in the business planned for 2023; and

The Company’s 2023 AOP, which the OP&C Committee believed at the time it approved 2023 goals represented the Company’s best estimate of 2023 performance.

The OP&C Committee approved the 2023 Revenue, AOI, and the internal metric of greatest focus,

is one of the most important underlying drivers of business performanceOMR Program goals and other financial metrics (such as adjusted diluted EPS, operating cash flow and returnrelated compensation levels based on invested capital),

is aligned with creating shareholder value as sustained adjusted operating earnings is both highly correlated with share price growth and a key driver of free cash flowconclusion that they provided a reasonable opportunity to shareholders which is also highly correlated to equity value,

is aligned with our investor communications and the area of focus of our investor base, and

is in part driven by our performance of our transformation agenda and RBT initiatives.

The Compensation Committee’s goal in settingachieve a bonus at the target achievement levels was to provide management withlevel and an appropriately challenging yet reasonably achievable goals that would lead the Company to meeting its 2017 business plan and position the Company to ultimately achieve the growth, transformation and improvement targets in our strategic plan without encouraging excessive risk-taking behavior. We believe that the use of a key financial performance metric that rewards profitable growth, as well as a qualitative performance metric to assess individual efforts and goal achievement, provides a balanced assessment of performance. The Compensation Committee retains authority to reduce or eliminate incentive compensation, which allows the committee to make judgments as to compensation it believes is excessive in light of performance as well as to monitor and respond to any behavior that it believes could be detrimental to the Company.

In structuring the 2017 financial Performance Metrics, the Compensation Committee took into account several unique factors for 2017 including (1) that expected 2017 financial results were expected to be lower than 2016 performance, (2) that the Company’s Domestic business segment was facing margin compression and intensifying competitive dynamics, and (3) that the Company needed to retain and incentivize key leaders, including the NEOs, to deliver 2017 performance and reposition and transform the Company for the future. As a result, the Compensation Committee structured the financial performance metrics to allow forpro-rated AIP payout at a lower threshold (80% of AOP achievement), reduced payout of AIP at 100% AOP attainment and a steeper AIP curvestretch opportunity for performance in excess of target. The approved annual cash incentive program included a threshold level of performance that must be attained to receive any cash incentive payout; a target level of performance, which, if attained, would result in a 100% of AOP. Additionally, no amount would be payable in

respecttarget cash incentive payout; and a maximum level of any Performance Metrics for achievement below the Threshold Payout Amount or if the Company did not achieve the Qualifier. The AIP structure resulted in a 2017 AIP curve as follows:

LOGO

The Company’s 2017 adjusted operating earnings performance of $166 million resulted in achievement of 37%200% of target for the financial component of the NEO’s 2017 AIP (weighted 80% of the overall plan).

Originally introduced in 2015, the Compensation Committee retained a QPF as a performance metric that, subject to meeting the Qualifier, would allow a portion of any cash incentive compensation earned by the NEOs to be based on an overall assessment of the NEO’s job performance relative to leadership, performance against position-specific goals, strategic focus, management skills and other factors. The Compensation Committee believes that inclusion of the QPF is a way to reward strong performance and leadership that may or may not have translated into achievement of other financial and operating targets during the year, but that were nonetheless important achievements contributing to future value creation. The NEOs’ individual performance goals and key performance indicators that were used to determine the NEOs QPF included the following:

 NEOIndividual Performance Goal

 P. Cody Phipps

 Chairman, President & Chief  Executive Officer

•  Drive business performance

Ø  Achieve 2017 financial goals

Ø  Deliver RBT financial and operational goals

Ø  Mitigate competitive risks to business

•  Build leadership talent and capabilities to enhance our execution

•  Develop & advance our enterprise strategy

Ø  Execute on stated four-part strategy

Ø  Transform & strengthen business through strategic, transformational M&A

•  Develop as CEO, enhance Company culture & build confidence with key stakeholders

Ø  Lead “Purpose Driven Culture” through teammate engagement

Ø  Strengthen confidence with investors

Ø  Build & strengthen relationship with customers

 NEOIndividual Performance Goal

 Richard A. Meier

 Executive Vice President,

 Chief Financial Officer &

 President, International

•  Achieve 2017 financial goals (including within the International segment)

•  Drive the RBT process and create momentum toward 2020run-rate financial performance

•  Execute strategic M&A transactions to transform andre-position the Company

 Stuart Morris-Hipkins

 Executive Vice President,

 Manufacturing Services

•  Develop global manufacturing services strategy

•  Enhance margin and profitability for manufacturing service business unit

•  Develop and implement customer-level financial reporting and operational metrics

 Rony C. Kordahi

 Executive Vice President,

 North American Operations

•  Realize continuous improvement savings

•  Deliver financial goals identified in the RBT

•  Drive standard operating procedures & productivity

 Charles C. Colpo

 Senior Vice President,

 Owens & Minor Europe Operations

•  Execute International Segment growth strategy

•  Deliver International Segment financial results

•  Enhance International Segment IT platform to make it a competitivedifferentiator

The Compensation Committee reviewed the performance of each individual NEO against his respective goals. After review, the Compensation Committee exercised negative discretion for 2017 incentive awards as they relate to Messrs. Phipps, Meier, Kordahi and Colpo as a result of: for Mr. Phipps, the Company’s 2017 overall financial performance, financial performance of our International segment and failure to fully-meet operational productivity goals in Domestic segment; for Mr. Meier, the Company’s 2017 overall financial performance and the financial performance of our International segment; for Mr. Colpo, the financial performance of our International segment; and, for Mr. Kordahi, the Company’s failure to fully-meet operational productivity goals in our Domestic segment. The exercise of negative discretion resulted in attainment of the QPF at 18.5% for each of Messrs. Phipps, Meier, Kordahi and Colpo. The Compensation Committee determined that Mr. Morris-Hipkins had met his 2017 QPF goals at the full 37% level.

The table below sets forth (i) the Performance Metrics, their respective weightings, achievement levels at threshold, target and maximum as well as actual results in 2017 for each financial Performance Metric and (ii) the Qualifier and actual achievement level required for the payment of any incentive compensation under the Annual Incentive Program.

2017 Performance Metric Achievement Levels and Actual Results

Performance Metrics  Weighting  

Threshold (1)

35%

  

Target (1)

75%

  

Maximum (1)

200%

  2017
Results (2)
  

2017

Achievement

Company Adjusted Operating Earnings (1)(2)

 80%  $163.2 million   $204 million   $244.8 million   $166 million  37%

Qualitative Performance Factor

 20%  N/A   N/A   N/A   See footnote (3)  See footnote (3)

Qualifier

 N/A  $130 million   N/A   N/A   $166 million  Yes

(1)award. For achievement levels above threshold but below target, or above target but below maximum, payout amounts would beare calculated based on a straight-line interpolation of the achievement level above threshold or target, as applicable.

(2) For purposesThe threshold, target, and maximum levels of the 2017 Annual Incentive Program,2023 AIP and associated 2023 performance are set forth in accordance with the termstable below. These financial goals are set on a constant currency basis so performance can be measured without positive or negative impact from currency fluctuations that are largely outside of the program as approvedNEOs’ control. The financial performance resulted in overall funding for the AIP at 100% of the target performance level.

Performance Metric

Threshold

(AIP 0%)

Target

(AIP 100%)

Maximum

(AIP 200%)

Actual1

Actual AIP  

Achievement  

2023 Revenue (20%)

< $9,829.0 million

$10,346.0 million

 $10,863.0 million

$10,337.6 million

98%

2023 AOI (60%)

< $  295.0 million

$  325.0 million

 $  353.0 million

$  315.4 million

2

68%

OMR Program AOI Benefit (20%)

$  20.0 million

$   30.0 million

$   40.0 million

$  40.0+ million

200%

1

Shown on a constant currency basis. Revenue was $10,334 million for the year-ended December 31, 2023 and was unfavorably impacted by foreign currency of $3.7 million based on foreign currency rates as of December 31, 2023 and AOI was $304.7 million for the year-ended December 31, 2023 and was unfavorably impacted by foreign currency of $4.3 million based on foreign currency rates as of December 31, 2023. Adjusted Operating Income (non-GAAP), or AOI, and other non-GAAP financial measures included in this Proxy Statement and a reconciliation to the most comparable GAAP equivalent financial measure are described in the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2024.

Owens & Minor, Inc.2024 Proxy Statement53


 Executive Compensation 

2

In determining achievement of the AOI performance metric under the 2023 AIP, the OP&C Committee considered a portion (approximately $6.4 million) of the costs associated with the Company’s accounts receivable sales program for 2023, which reduced our 2023 AOI but were not contemplated when the OP&C Committee established the original target performance levels. The actual AIP achievement for 2023 AOI would have been approximately 82% had those costs been excluded, resulting in total funding of 109% of target. Accordingly, the actual 2023 AOI metric used for calculating the 2023 AIP achievement is different from the 2023 AOI used for other purposes.

2023 NEO MBOs and Performance

MBOs are performance metrics that allow for a modification (+/- 0-35%) to the annual incentive earned by the CompensationNEOs based on an assessment of the NEO’s job performance against position-specific financial, operational, or other goals; strategic focus; management skills; and other quantitative or qualitative objectives. The OP&C Committee adjustedbelieves it is important to include MBOs as performance metrics that either:

Reward for strong performance and leadership, given these metrics are leading indicators of successful execution of financial, strategic, and operational initiatives that contribute to current and future value creation, or

Allow for negative discretion to reduce a bonus award where the NEO has not successfully performed his MBOs.

While each NEO had unique 2023 MBOs applicable to his respective span of control and duties, all MBOs were designed to advance the Company’s three primary areas of focus for 2023:

Grow and Develop Our Talent

Operational Execution

Drive Profitable Growth

The following table summarizes the MBOs and key achievements of each NEO in 2023:

Summary of 2023 MBOs

Edward A. Pesicka

   Meet key financial metrics set forth in the 2023 AOP

   Transformation initiative including savings and profit improvement

   Execute initiatives to improve capital structure to support company strategic plan

   Implement a revised S&OP process to improve inventory build and sourcing

   Further embed the OM Business System into the organization and focus on service levels

   Strengthen our culture of DE&I to deliver results

   Expand the Leadership Development Program

   Talent assessment and succession planning

Alexander J. Bruni

   Meet key financial metrics set forth in the 2023 AOP

   Lead initiatives that drive profitable growth for the company

   Support overall OMR Program to deliver AOI and working capital improvement targets

   Establish company level Strategic Planning (STRAP) process, supporting timeline, and standard work while improving strategic market analysis

   Execute initiatives to improve capital structure to support the strategic plan

   Develop and implement ERM Strategy

   Mature Finance rotational program and evolve Finance talent engagement and development programs

   Strengthen our culture of DE&I through inclusion training and mentoring hi-potential diverse teammates

54Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

Summary of 2023 MBOs

Andrew G. Long

   Meet key financial metrics set forth in 2023 AOP

   Enhance sales effectiveness for profitable growth through aligned compensation structure, enhanced tools, and aligned roles & responsibilities

   Expand products portfolio

   Optimize distribution center network aligning to existing customer needs and opportunities

   Drive AOI performance by evaluating overhead costs, rationalization, and waste elimination

   Strengthen operational excellence in international markets and distribution

   Achieve 99% service levels in upstream & downstream distribution centers

   Improve effectiveness of Global S&OP process, reduce excess inventory, and establish sustainable inventory management processes

   Drive entrepreneurial behavior in targeted areas

   Establish prioritization process for P&HS OMPower initiatives to ensure alignment to the strategic imperatives and managing teammate capacity

   Foster an environment where teammates can grow professionally and encourage active engagement in TRGs

Perry A. Bernocchi

   Meet key financial metrics set forth in the 2023 AOP

   Execute AOI improvement plan through price improvement and operational efficiencies

   Achieve revenue synergy growth

   Continue digital transformation through execution of web and mobile app enhancements

   Implement KPI Management throughout Patient Direct

   Formulary implementation and launch

   Develop problem solving skills throughout the organization utilizing OMPower

   Retain top talent and reduce attrition

Daniel J. Starck

Patient Direct

   Meet key financial metrics set forth in the 2023 AOP to drive market share gains

   Lower Cost to Serve via technology initiatives and improved acquisition price savings

   Implement KPI Management throughout Patient Direct segment

   Implement enhancements that improve effectiveness at time of patient set-up

   Achieve Patient Direct synergy targets

   Reduce labor/labor costs via flexible workforce

   Prepare and solidify succession plan process for Patient Direct segment leadership roles

Business Excellence

   Achieve target in Adjusted Operating Income benefit from the newly established OMR Program

Considering the performance of our NEOs against their specific MBOs, the OP&C Committee determined that each of our NEOs had successfully achieved, in aggregate, the NEO’s respective MBOs. Following the determination of the financial achievement of 100% for the applicable performance metrics as provided2023 AIP, the OP&C Committee chose to award Mr. Long an additional 5% in light of the successful transformation of the P&HS segment that drove significant sequential improvement in profitability from the first quarter of 2023 through the fourth quarter of 2023 based on the permitted modification for MBOs.

Owens & Minor, Inc.2024 Proxy Statement55


 Executive Compensation 

2023 AIP Awards

In early 2024, considering the Company’s Annual Report on Form10-K forfinancial performance and MBO performance by the year ended December 31, 2017, filedNEOs as discussed above, the OP&C Committee approved cash incentive payments as follows:

    
   

Target

 (% of Base Salary) 

   Target Award  
Opportunity ($)
 

  Actual Amount  

Awarded ($)

 

   Actual   

(% of Target )

    

Edward A. Pesicka

 145% $1,450,000 $1,450,000 100%
    

Alexander J. Bruni

  80% $  420,000 $  420,000 100%
    

Andrew G. Long

  90% $  585,000 $  614,250  105%1
    

Perry A. Bernocchi

  90% $  513,000 $  494,5732 100%
    

Daniel J. Starck

 120% $  780,000 $  780,000 100%

1

The OP&C Committee awarded Mr. Long an additional 5% for the successful transformation of the P&HS segment.

2

Mr. Bernocchi had a lower target annual incentive opportunity of 70% of annual base salary prior to becoming an NEO in March 2023, at which time, his target annual incentive opportunity was increased to 90% of his annual base salary. The actual amount awarded reflects his weighted target percentages awarded at 100% for 2023 based on relative portions of the 2023 fiscal year in which he served in each role.

Long-Term Incentives

Equity grants help to align executive interests with those of our shareholders. The OP&C Committee considers Company performance, individual performance, long-term potential, and market practices when determining the SEC on February 23, 2018. In 2017, the Company adopted a revisednon-GAAP financial presentation that excludes amortizationvalue and type (e.g., RSU versus PSU) of acquisition-related intangible assets in additionequity awarded to items otherwise excluded. our executives.

Our Equity Granting Practices

The 2017 AIP targets were approved priorequity awards granted to this accounting change and therefore amortization of acquisition-related intangible assets has not been excluded in this table.

(3) As discussed in this CD&A, in determining achievement of the QPF for each NEO, the Compensation Committee reviewed their accomplishments and contributions in 2017 results as well as performance of their individual goals. QPF for our NEOs ranged between 18.5% and 37%.

Based on the foregoing results and the Compensation Committee’s review of individual NEO performance, each NEO received the following payoutin 2023 were made under the 2017 AIP:

Name2017 AIP Target 
as  % of Base Salary 
 2017 AIP Target ($) 

Financial
 Performance Results 

(80% weighting)

QPF
Results

(20%
 weighting) 

2017 AIP 

2017 AIP as 

% of Target 

P. Cody Phipps

 125%$1,153,125 37% 18.5%$383,991 33%

Richard A. Meier

 75%$489,871 37% 18.5%$163,127 33%

StuartMorris-Hipkins

 70%$297,500 37% 37%$91,730 37%

Charles C. Colpo

 50%$228,448 37% 18.5%$76,073 33%

Rony C. Kordahi

 70%$315,000 37% 18.5%$104,895 33%

(1) Mr. Morris-Hipkins’ 2017 incentive payout ispro-rated based on time in position during 2017 (10 months)

Long-Term Incentives

Our shareholder-approved 2015our 2018 Stock Incentive Plan, permitsas amended, which permitted us to award grants ofgrant non-qualified stock options, incentive stock options, stock awards, performance share awards, PSU awards, and stock unitsappreciation rights. On May 11, 2023, our shareholders approved the 2023 Omnibus Incentive Plan, replacing the 2018 Stock Incentive Plan. Our 2023 Omnibus Incentive Plan permits us to award grants of non-qualified stock options, incentive stock options, restricted stock, RSUs, performance awards (including PSU awards) and stock appreciation rights. Except in instances of initial executive hiring, job promotions, retention concerns and similar circumstances, we grant equity awards to executive officersone-time each year.year (generally at the time we review prior year’s performance and set current year compensation). This process occurs in the first quarter of the year, and the grant date is typically after the release of the prior year’s earnings and the filing of our Annual Report on Form 10-K with the SEC. The CompensationOP&C Committee’s decision to grant equity-based awards is discretionary and largely determined by the Company’s longer-term financial performance, strategic accomplishments and individual contributions. Equity award decisions may also be based upon individualthe executive’s position, performance, expected future performance job promotions and the assumptionspan of greater responsibility within the Company.control in his or her role. We strive to maintain an appropriate balance between the aggregate number of shares used for equity grants (relative to the competitive landscape) and shareholder interests.

We makeOur 2023 Awards

In 2023, we made annual equity award grants to seniorexecutive management in two forms: (1) restricted stock that vests after a three-year period during which the officer is continuously employed by the Company; and (2) performance share awards that are earned based on achievement of designated performance metrics over atwo-year period followed by aone-year holding period during which the officer must remain in the Company’s employ.

50% time-based vesting RSUs that vest ratably over a three-year period during which the officer is continuously employed by or providing services to the Company; and

50% PSUs that are earned based on achievement of designated performance metrics over a three-year period, subject to the officer’s continued employment by or service to the Company.

We believe that the mix between these vehiclesRSUs and PSUs helps provide a balance between linking compensation to the achievement of multi-year performance goals and strengthening the alignment of management and shareholder interests by creating meaningful levels of Company stock ownership by management. The Company has not issued stock options to its officers since 2007.

In accordance with our standard practice, the grant of the 2017 annual equity awards was made at the first meeting of our Board in 2017 on February 9, 2017, a date that is scheduled more than one year in advance. The grantGrant values are based on the closing price of the Company’s stock on the date of grant.

56Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

The 2023 PSU grant design maintained a three-year performance period. The PSU metric is a three-year cumulative adjusted EPS; in addition, the OP&C Committee added relative TSR as a modifier to further enhance the alignment of our executives with shareholder returns relative to that of other companies in the performance index.

On March 1, 2023, the Company granted RSUs to Messrs. Pesicka, Bruni, Long, Bernocchi, and the number of shares subjectStarck. Also on March 1, 2023, in addition to the award.annual award, Mr. Long received a one-time award of RSUs with a grant value of $1,000,000 in recognition of his recent appointment as CEO, P&HS in October of 2022.

When making 2017 long-term incentive equity award determinations,The following table shows the Compensation Committee focused on the Company’s longer-term financial performance and balanced the need to align the NEOs’ financial interests with those of shareholders against considerations regarding the affordability of equity grants, including aggregate share usage, dilution and accounting costs. We have historically been below median relative to the Peer Companies in our equity award grants to minimize share usage, dilution and accounting costs but are gradually evolving to increased long-term incentives (with more performance shares) relative to other elements of compensation in an effort to make our compensation program more performance-based and market driven.

Additionally, as discussed earlier in this CD&A, in 2017 the Compensation Committee granted additional Performance Shares designed to retain and incentivize NEOs and certain key leaders to deliver the Company’s transformational agenda and financial performance through December 31, 2019. Vesting of these Performance Shares is contingent on the Company reaching certain levels of adjusted earnings per share for calendar year 2019. The Company expects to disclose the results of these awards in its 2020 proxy statement after the performance period has concluded and financial performance has been measured.

Based on the foregoing considerations, the Compensation Committee granted the followingannual long-term incentive awards granted to the NEOs in 2017 having the indicated grant date fair values:2023:

 

2017 Long-Term Incentive Awards (1) 
Name  

Performance

Shares

(2)

   

Restricted

Stock

(3)

   

Transformation
Performance
Shares

(4)

   Sign-on
Award of
Restricted
Stock
   Total 

P. Cody Phipps

  $2,000,007   $2,000,007   $999,986   $—     $5,000,001 

Randy R. Meier

   350,015    350,015    350,015    —      1,050,044 

Stuart Morris-Hipkins (5)

   350,017    350,017    350,000    285,004    1,335,037 

Charlie C. Colpo

   155,993    155,993    155,993    —      467,979 

Rony C. Kordahi

   350,015    350,015    350,015    —      1,050,044 

(1) The amounts shown are the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718 and, in the case of performance shares, are based on probable achievement at target levels.

(2) These performance shares generally require achievement by the Company of specific financial metrics (discussed below) for fiscal years 2017 and 2018 as a condition to issuance of the underlying shares of restricted stock (which, if earned, would vest on the third anniversary of the performance share award). Amounts in the table reflect the values if achieved at the target level. Mr. Phipps’ long-term incentive compensation and equity targets are higher relative to the other NEOs to reflect the broader scope of his responsibilities and authority and his greater ability to impact the Company’s performance.

(3) These shares of restricted stock vest three years from the date of grant based on the executive��s continued employment with the Company.

(4) The performance shares were a special, unique award designed to retain NEOs and incentivize delivery of our transformation and 2019 financial goals. Amounts in the table reflect the values if achieved at the target level.

(5)Sign-on time-based restricted stock granted in connection with commencement of employment with the Company.

The table below shows the metrics, weights and performance levels established for the 2017 performance share awards. The Compensation Committee approved 2017 adjusted earnings per share (adjusted diluted EPS) andtwo-year (2017-2018) average return on capital employed (ROCE), weighted 80% and 20%, respectively, as metrics for the long-term incentive performance shares that were granted in 2017. The Compensation Committee choose adjusted diluted EPS as a financial metric because this metric:

 

2023 Long-Term Incentive Target Annual Award Values

 
      

Name

 

RSUs

($)

  

RSUs

(#)

  

PSUs

($)

   PSUs (#)     Total ($)   

Edward A. Pesicka

 

$

2,750,000

 

 

 

178,109

 

 

$

2,750,000

 

 

 

178,109

 

 

$

5,500,000

 

Alexander J. Bruni

 

 

500,000

 

 

 

32,384

 

 

 

500,000

 

 

 

32,384

 

 

 

1,000,000

 

Andrew G. Long 1

 

 

2,150,000

 

 

 

139,249

 

 

 

1,150,000

 

 

 

74,482

 

 

 

3,300,000

 

Perry A. Bernocchi

 

 

1,000,000

 

 

 

64,767

 

 

 

1,000,000

 

 

 

64,767

 

 

 

2,000,000

 

Daniel J. Starck

 

 

812,500

 

 

 

52,624

 

 

 

812,500

 

 

 

52,624

 

 

 

1,625,000

 

 

1

In addition to his annual equity grant, Mr. Long received a one-time RSU award with a target grant value of $1,000,000.

is the metric of greatest attention by analysts and our investors,

is aligned with shareholder value as sustained adjusted diluted EPS growth is both highly correlated with share price growth and adjusted diluted EPS is a key driver of free cash flow to shareholders which is also highly correlated to equity value,

is consistent with our message to shareholders that our focus is on consistent earnings growth,

is widely understood by award recipients, and

is impacted and driven in part by our performance of Transformation Agenda initiatives.

In addition to adjusted diluted EPS, the Compensation Committee selected ROCE as a performance metric because:

the metric captures management’s ability to create value through better balance sheet management,

the metric measures profitability and value creation over time as derived from the Company’s use of capital which can create value for shareholders, and

a significant portion of our shareholder base and analysts believe that efficient use of capital employed is an important metric of our performance.

2017 Performance Share Award Metrics

Performance Metric (1) (2)  Weight  Threshold  Target  Maximum

Adjusted Diluted EPS

  80%  $1.94  $2.15  $2.58

Average Return on Capital Employed (ROCE)

  20%  11.5%  12.8%  15.4%

(1) For achievement levels above threshold but below target, or above target but below maximum, share payout amounts would be calculated based on a straight line interpolation of the achievement level above threshold or target, respectively. There is no payout for achievement below threshold.

(2) The average return on capital employed metric is measured over the 2017 and 2018 calendar years and the adjusted diluted EPS metric is measured for the calendar year 2018 and based on the applicable weights and achievement levels will result in the issuance of restricted stock to each officer.

Payouts on 2016 Performance Share Awards.    Based the Company’s failure to achieve thetwo-year performance metrics under the Performance Share Awards granted in 2016, the NEOs did not earn the performance share awards that were issued in 2016. These shares will not vest and will be forfeited.

Payouts on 2016 Performance Share Awards

Performance Metric   Weight   

 Target 

 100% 

  

Actual

 Achievement (1) 

  

Percentage

 Achievement 

Adjusted Diluted EPS

  80%  $2.12  $1.49  0%

Return on Invested Capital

  20%  10%  Less than 9%  0%

(1) For purposes of the 2016 Performance Share Awards, and in accordance with the terms of the underlying agreements approved by the Compensation Committee, adjusted results for the applicable performance metrics as provided in the Company’s Annual Report on Form10-K for the year ended December 31, 2017.

Common Stock Ownership Guidelines.Guidelines

We have established Common Stock ownership guidelines for our executive officers that they are expected to be achievedachieve and maintained.maintain during their employment with the Company. Under these guidelines, officers are givenhave approximately five years to reach the full target ownership amount with interim targets to meet each year. As of December 31, 2017, each continuing NEO2023, Messrs. Pesicka, Long, Bernocchi and Starck had achieved his or herexceeded their applicable target ownership level (Mr. Morris-Hipkins and Mr. Kordahi, who joinedlevel. Recently appointed NEO, Alex Bruni, is in the Company in 2017 and 2016, respectively, have five years fromprocess of attaining the date of hire to meet the guidelines and currently are on track to do so).required ownership levels. Because of the historical success of these guidelines in maintaining meaningful stock ownership levels among management, the Company has not imposed any further stock retention requirements on its executive officers in connection with stock option exercises or vesting of restricted stock.

The ownership guidelines are as follows:

                     Officer                    

Value of Common Stock

Chief Executive Officer

6.0 x Base Salary

President

3.0 x Base Salary

Executive Vice Presidents

2.0 x Base Salary

Senior Vice Presidents

1.5 x Base Salary

Vice Presidents, Regional Vice Presidents

1.0 x Base Salary

The Chief Executive Officer’s higher ownership target reflects the larger portion of his total compensation represented by long-term incentive award value. Eligible holdings in meeting these targets include direct holdings, indirect holdings, shares held through Company plans such as the teammate stock purchase plan,Teammate Stock Purchase Plan, and restricted stock holdings (but excluding any stock options).

2018 Stock Incentive PlanThe ownership guidelines are as follows:

Officer

Value of Common Stock

Chief Executive Officer

6.0 x Base Salary

Executive Vice Presidents

2.0 x Base Salary

Senior Vice Presidents

1.5 x Base Salary

The CEO’s higher ownership target reflects the larger portion of his total compensation represented by long-term incentive award value.

Hedging, Pledging and Derivatives Trading Prohibition

The Board of DirectorsCompany has approved, adoptedpolicies that prohibit directors, officers, and submitted for shareholder approval the 2018 Stock Incentive Plan which is more fully discussed under “Approvalother teammates with access to confidential information of the Company from engaging in certain transactions relating to our Common Stock, including buying or selling options and short sales. We also prohibit these individuals from hedging the economic risk of ownership of our Common Stock and holding our Common Stock in a margin account or pledging our Common Stock as collateral for a loan.

Impact of Accounting and Tax Requirements on Compensation

The OP&C Committee considers certain tax implications when designing the Company’s executive compensation programs. Section 162(m) of the Internal Revenue Code (the “Code”) generally precludes a tax deduction by any publicly-traded

Owens & Minor, Inc. 2018 Stock Incentive Plan”2024 Proxy Statement57


 Executive Compensation 

company for compensation paid to any “covered employee” to the extent the compensation paid to such covered employee exceeds $1 million during any taxable year of the company. “Covered Employees” include any employee (i) serving as the CEO or the CFO of the Company at any time during the taxable year, (ii) whose total compensation is required to be reported to the shareholders of the Company by reason of being among the three highest paid officers of the Company (other than the CEO and the CFO) for the applicable taxable year, or (iii) any employee who qualified as a “covered employee” for any previous taxable year of the company (or any predecessor) beginning after December 31, 2016. While we prefer to maximize the deductibility of any compensation we pay, we also believe that it is important to preserve flexibility in administering our compensation programs to promote various corporate goals. Accordingly, we have not adopted a policy that all compensation must be deductible in full. Certain of the amounts paid under our compensation and other executive programs will not likely be deductible as the result of Section 162(m). We intend to continue to design our executive compensation arrangements to be consistent with our best interests and the interests of our shareholders and we understand that certain of our compensation arrangements will not be deductible in full.

Recoupment Policy

In an effort to mitigate any imprudent risk-taking behavior associated with incentive compensation, the Company has a policy that provides for the recoupment of performance-based cash compensation and all equity compensation (including both time- and performance-vesting equity awards) granted or paid to our current and former executive officers and other senior executives and teammates as the OP&C Committee may from time to time designate under circumstances involving a restatement of our financial statements. Performance-based compensation is recoverable from an executive officer (i) in the event the Company is required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any financial reporting requirement under applicable securities laws (an “Accounting Restatement”) and (ii) a lower payment would have been made to the executive officer based upon the restated financial results. In addition, upon an Accounting Restatement, time-based equity compensation is recoverable in amounts as determined by the OP&C Committee. The recoupment policy does not apply to covered compensation after the third anniversary of the date on page 18which such compensation was paid. Our recoupment policy complies with the NYSE’s clawback rules promulgated under Section 10D of this proxy statement.the Exchange Act and the rules promulgated thereunder.

Retirement/Post-Termination Compensation

Retirement CompensationOur People & Culture Committee Report

The Company believesOP&C Committee has reviewed and discussed the CD&A contained in this Proxy Statement with management. Based on such review and discussion, the OP&C Committee has recommended to the Board that the CD&A be included in this Proxy Statement and incorporated by reference into the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

THE OUR PEOPLE & CULTURE COMMITTEE

Robert J. Henkel, Chair

Mark A. Beck

Kenneth Gardner-Smith

58Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

2023 Summary Compensation Table

The following table summarizes the total compensation of our NEOs for 2023, and earlier years as applicable:

        

(a)

(b)(c)(d)(e)(f)(g)(h)
       

Name and Principal

Position

Year

Salary(1)

($)

Bonus

($)

Stock
Awards(2)

($)

Non-Equity
Incentive Plan
Compensation(3)

($)

All Other
Compensation(4)

($)

Total

($)

       

Edward A. Pesicka
President & Chief Executive Officer

 2023$1,000,000 $5,834,851$1,450,000 $105,059$8,389,910
 2022 974,954  4,915,897 273,000 81,408 6,245,259
 2021 912,000  4,400,000 2,280,000 88,578 7,680,578

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       

Alexander J. Bruni
Executive Vice President & Chief Financial Officer

 2023 528,180  1,060,900 420,000 18,174 2,027,254
 2022 397,161  400,060 62,646 15,494 875,361

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       

Andrew G. Long
Executive Vice President, Chief Executive Officer, Products & Healthcare Services

 2023 653,938  3,440,033 614,250 16,324 4,724,545
 2022 632,923  2,261,365 122,850 47,321 3,064,459
 2021 564,731  1,900,000 1,062,000 38,756 3,565,487

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       

Perry A. Bernocchi
Executive Vice President, Chief Executive Officer, Patient Direct Former, President & CEO, Byram Healthcare

 2023 554,000  2,121,766 494,573 20,543 3,190,882

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       

Daniel J. Starck
Executive Vice President, Business Excellence Former, Executive Vice President, President – Patient Direct & CEO of Apria

 2023 650,000  1,723,963 780,000 28 3,153,991
 2022 637,500  4,341,851 122,850 22,750 5,124,951
       

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

The amounts in column (c) reflect the base salary earned by each NEO. Effective March 1, 2023, Mr. Bernocchi received a base salary increase of 16% as a result his promotion to EVP, CEO Patient Direct.

(2)

The amounts included in column (e) are the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718, and include awards subject to performance conditions. Of the total awards reflected in column (e) for 2023, the amount specified below for each NEO represents awards subject to performance and market conditions, which are valued at the grant date based on probable achievement at target levels:

Mr. Pesicka, $3,084,848; Mr. Bruni $560,891; Mr. Long, $1,290,028; Mr. Bernocchi $1,121,764; and Mr. Starck, $911,448.

The grant date value of the above performance-based awards for 2023 would equal the following for each NEO assuming achievement of the highest level of performance conditions:

Mr. Pesicka, $6,169,696; Mr. Bruni, $1,121,782; Mr. Long, $2,580,056; Mr. Bernocchi, $2,243,529; and Mr. Starck, $1,822,895.

The amounts included in column (e) for Mr. Long reflect his annual grant of RSUs as well as a special grant of RSUs on March 1, 2023 in recognition of his recent appointment as CEO, Products & Healthcare Services in October of 2022.

Assumptions used in the calculation of the stock awards included in column (e) are included in Note 10 “Share-Based Compensation” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which is incorporated herein by reference. The actual value an NEO may receive for stock awards depends on market prices, and there can be no assurance that the amounts shown are the amounts that will be realized.

(3)

The amounts included in column (f) reflect cash awards to the NEOs under the Company’s performance-based annual incentive programs. For Mr. Bernocchi, the actual amount awarded reflects his weighted target percentages for 2023 based on relative portions of the 2023 fiscal year in which he served in each role.

Owens & Minor, Inc.2024 Proxy Statement59


 Executive Compensation 

(4)

For 2023, the amounts included in column (g) consist of the following:

       

Name

Tax Planning
Benefit
a
Life
Insurance
Premiums
Defined
Contribution
Plans
Company
Match and
Contribution
b
Executive
Physical
OtherCTotal
      

Edward A. Pesicka

 $15,000 $624 $12,200 $5,400 $71,835 $105,059
      

Alexander J. Bruni

 2,650 624 12,200 2,700  18,174
      

Andrew G. Long

 3,500 624 12,200   16,324
      

Perry A. Bernocchi

 —  612 19,181  750 20,543
      

Daniel J. Starck

 —  28 —    28

(a)

In 2023, the maximum tax and financial planning benefit was $15,000 for Mr. Pesicka; $3,500 for Messrs. Bruni, Long, Bernocchi and Starck. NEOs are required to submit documentation for reimbursement up to the plan levels shown.

(b)

In 2023, any NEOs who elected to participate in the Company’s 401(k) program were treated on the same basis as all U.S. based teammates, including a 4% company match on employee contributions. Further, Mr. Bernocchi elected to participate in the non-qualified Executive Deferred Compensation and Retirement Plan, and the Company will match an additional 1%, or $6,981 for the 2023 plan year into the Executive Deferred Compensation and Retirement Plan that will be deposited in the second quarter of 2024.

(c)

Other includes:

i.

For Mr. Pesicka, (A) $70,835 in incremental costs to the Company for use of the corporate aircraft was determined to be a perquisite in accordance with SEC rules and (B) the Company’s HSA match of $1,000.

ii.

For Mr. Bernocchi, the Company’s HSA match of $750.

60Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

2023 Grants of Plan-Based Awards

           

(a)

     (b)  (c) (d)  (e)  (f) (g)  (h)  (i)  (j) 
       

Name

     Grant Date  

 

Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
(1)

  

 

Estimated Potential Payouts
Under Equity Incentive Plan Awards
(2)

  

All Other
Stock
Awards:
Number

of

Shares of
Stock or
Units (3)
(#)

  Grant Date Fair
Value of Stock
and
 Option Awards 
(4) ($)
 
  Award  Threshold
($)
 Target
($)
  Maximum
($)
  Threshold
(#)
 Target
(#)
  Maximum
(#)
 
          

Edward A. Pesicka

 

 

RSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

178,109

 

 

$

2,750,003

 

 

 

PSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

178,109

 

 

 

356,218

 

 

 

 

 

 

3,084,848

 

 

 

AIP

 

 

 

2023

 

 

 

$

1,450,000

 

 

$

2,900,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

          

Alexander J. Bruni

 

 

RSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

32,384

 

 

$

500,009

 

 

 

PSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

32,384

 

 

 

64,768

 

 

 

 

 

 

 

560,891

 

 

 

AIP

 

 

 

2023

 

 

 

$

420,000

 

 

$

840,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

          

Andrew G. Long

 

 

RSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

74,482

 

 

$

1,150,003

 

 

 

RSU

(5) 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

64,767

 

 

 

1,000,002

 

 

 

PSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

74,482

 

 

 

148,964

 

 

 

 

 

 

1,290,028

 

 

 

AIP

 

 

 

2023

 

 

 

$

585,000

 

 

$

1,170,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

          

Perry A. Bernocchi

 

 

RSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

64,767

 

 

$

1,000,002

 

 

 

PSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

64,767

 

 

 

129,534

 

 

 

 

 

 

1,121,764

 

 

 

AIP

(6) 

 

 

2023

 

 

 

$

513,000

 

 

$

1,026,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

          

Daniel J. Stark

 

 

RSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

52,624

 

 

$

812,515

 

 

 

PSU

 

 

 

3/1/2023

 

 

 

 

 

 

 

 

 

 

 

52,624

 

 

 

105,248

 

 

 

 

 

 

911,448

 

 

 

AIP

 

 

 

2023

 

 

 

$

780,000

 

 

$

1,560,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

The amounts included in columns (d) and (e) reflect the target and maximum amounts, respectively, payable to the NEOs under the Company’s performance-based annual incentive programs, which are described in more detail under “Compensation Discussion & Analysis—2023 AIP Awards” above.

(2)

The amounts included in columns (g) and (h) reflect the target and maximum number, as applicable, of PSUs granted to the NEOs under the Company’s 2018 Stock Incentive Plan.

(3)

The amounts included in column (i) reflect time-based RSUs awarded to the NEOs under the Company’s 2018 Stock Incentive Plan.

(4)

The amounts in this column represent the grant date fair value of stock awards computed in accordance with stock-based compensation accounting rules (FASB ASC Topic 718). For stock awards, the grant date fair value is the fair market value of the Company’s common stock on the grant date multiplied by the number of shares subject to the grant. For a discussion of the assumptions involved in the Company’s valuations, please see Note 10, “Shared-Based Compensation” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which is incorporated herein by reference. The actual value an NEO may receive for stock awards depends on market prices, and there can be no assurance that the amounts shown are the amounts that will be realized.

(5)

Mr. Long received a one-time additional grant of RSUs in conjunction with his annual grant for his assumption of the role Executive Vice President, CEO, P&HS in the fourth quarter of 2022.

(6)

Mr. Bernocchi had a lower target annual incentive opportunity of 70% of annual base salary prior to becoming an NEO in March 2023, at which time, his target annual incentive opportunity was increased to 90% of his annual base salary.

Owens & Minor, Inc.2024 Proxy Statement61


 Executive Compensation 

Outstanding Equity Awards at 2023 Fiscal Year-End Table

The following table summarizes information regarding outstanding equity awards held by the NEOs as of December 31, 2023.

  Stock Awards(1)
      

Name

 Date 

Number of shares
or units of stock
that have not
vested (#)

 

Market value of
shares or units of
stock that have not
vested ($)
(3)

 

Equity Incentive
plan awards:
number of
unearned shares,

units or other
rights that have
not vested (#)
(2)

 

Equity Incentive plan
awards: market or
payout value of
unearned shares,
units or other rights
that have not vested

($)(3)

     

Edward A. Pesicka

  

 

3/1/2021

  

 

21,267

(4)

 
  

$

409,815

  

 

  

 

  

 

3/3/2022

  

 

38,579

(6)

 
  

 

743,417

  

 

  

 

     
   4/29/2022         58,453(7)   $1,126,389
     
  

 

3/1/2023

  

 

128,882

(5)

 
  

 

2,483,556

  

 

  

 

     
  

 

3/1/2023

  

 

178,109

(10)

 
  

 

3,432,160

  

 

178,109

(11)

 
  

 

3,432,160

     

 

Total

 

    

 

366,837

  

$

7,068,949

  

 

236,562

  

$

4,558,550

     

Alexander J. Bruni

  

 

3/1/2021

  

 

2,534

(4)

 
  

$

48,830

  

 

  

 

     
  

 

3/3/2022

  

 

4,630

(6)

 
  

 

89,220

  

 

  

 

     
   8/10/2022   1,909(8)    36,786      
     
  

 

3/1/2023

  

 

32,384

(10)

 
  

 

624,040

  

 

32,384

(11)

 
  

$

624,040

     

 

Total

 

    

 

41,457

  

$

798,876

  

 

32,384

  

$

624,040

     

Andrew G. Long

  

 

3/1/2021

  

 

9,184

(4)

 
  

$

176,976

  

 

  

 

     
  

 

3/3/2022

  

 

17,747

(6)

 
  

 

341,985

  

 

  

 

     
   4/29/2022         26,889(7)   $518,151
     
  

 

3/1/2023

  

 

55,654

(5)

 
  

 

1,072,453

  

 

  

 

     
  

 

3/1/2023

  

 

139,249

(10)(12)

 
  

 

2,683,328

  

 

74,482(11)

  

 

1,435,268

     

 

Total

 

    

 

221,834

  

$

4,274,741

  

 

101,371

  

$

1,953,419

     

Perry A. Bernocchi

  

 

3/1/2021

  

 

5,801

(4)

 
  

$

111,785

  

 

  

 

     
  

 

3/3/2022

  

 

7,717

(6)

 
  

 

148,707

  

 

  

 

     
  

 

4/29/2022

  

 

18,597

(6)

 
  

 

358,364

  

 

11,691

(7)

 
  

$

225,286

     
  

 

3/1/2023

  

 

35,150

(5)

 
  

 

677,341

  

 

  

 

     
  

 

3/1/2023

  

 

64,767

(10)

 
  

 

1,248,060

  

 

64,767

(11)

 
  

 

1,248,060

     

 

Total

 

    

 

132,032

  

$

2,544,257

  

 

76,458

  

$

1,473,346

     

Daniel J. Starck

  

 

5/10/2022

  

 

14,255

(6)

 
  

$

274,694

  

 

85,394

(7,9)

 
  

$

1,645,542

     
  

 

3/1/2023

  

 

52,624

(10)

 
  

 

1,014,064

  

 

52,624(11)

  

 

1,014,064

     

 

Total

 

       

 

66,879

  

$

1,288,758

  

 

138,018

  

$

2,659,607

(1)

Prior to March 3, 2022, the Company generally granted awards to the NEOs in the form of restricted stock and performance shares, subject to exceptions in some instances. Following March 3, 2022, the Company has granted awards to NEOs in the form of RSUs and PSUs.

(2)

Amounts in this column represent the number of performance shares or PSUs, as applicable, outstanding based on the achievement of target performance conditions. Actual amounts earned, if any, will be based on achievement of the applicable performance metrics.

(3)

Calculated based on the $19.27 closing price per share of our Common Stock on December 29, 2023.

(4)

Vests in substantially equal installments on an annual basis over a three-year period from the vesting commencement date of May 15, 2021.

(5)

The original grant was awarded as performance shares tied to FY 2021 & FY 2022 performance. Following the measurement date, the award was cancelled and reissued in the form of a restricted stock grant in March 2023. The number of shares granted for the replacement restricted stock

62Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

award was based on performance against predetermined FY 2021—FY 2022 defined metrics. In March 2023, assessment was approved at 200%, and an additional one-year vesting requirement is in place per the terms of the original performance share agreement, whereby the award will vest on March 15, 2024.

(6)

Vests in substantially equal installments on an annual basis over a three-year period from the vesting commencement date of May 15, 2022.

(7)

Represents PSUs that can be earned in an amount ranging from 0% to 200% of the number of awarded shares based on the Company’s adjusted EPS performance for the three-year period January 1, 2022, through December 31, 2024. The OP&C Committee will determine if any shares have been earned following completion of 2024 and calculation of the three-year cumulative adjusted EPS and relative TSR as measured by the Russell 3000 Medical Equipment and Services Sector Index.

(8)

Vests in substantially equal installments on an annual basis over a three-year period from the vesting commencement date of August 15, 2022.

(9)

Reflects both an annual grant of PSUs and a one-time PSU award. 21,598 of Mr. Starck’s PSU awards are subject only to the vesting terms set forth in note (7). 63,796 of Mr. Starck’s PSU awards are based on Patient Direct segment three-year AOI, modified by the Owens & Minor PSU achievement levels achieved over that same three-year period, as described above in note (7).

(10)

Vests in substantially equal installments on an annual basis over a three-year period from the vesting commencement date of May 15, 2023.

(11)

Represents PSUs that can be earned in an amount ranging from 0% to 200% of the number of awarded shares based on the Company’s adjusted EPS performance for the three-year period January 1, 2023, through December 31, 2025. The OP&C Committee will determine if any shares have been earned following completion of 2024 and calculation of the three-year cumulative adjusted EPS and relative TSR as measured by the Russell 3000 Medical Equipment and Services Sector Index.

(12)

Mr. Long received a one-time additional grant of RSUs in conjunction with his annual grant for his assumption of the role Executive Vice President, CEO, P&HS in the fourth quarter of 2022.

2023 Option Exercises and Stock Vested

The following table summarizes for each NEO information regarding shares of our Common Stock subject to restrictions, RSUs or PSUs held by the NEOs that vested during 2023. No stock appreciation rights or stock options were outstanding during 2023.

 

Stock Awards

   

NEO

  Number of Shares Acquired 
on Vesting (#)
   Value Realized on  
Vesting ($)
  

Edward A. Pesicka

   748,176  $10,538,178
  

Alexander J. Bruni

   15,550   288,854
  

Andrew G. Long

   130,808   1,897,167
  

Perry A. Bernocchi

   37,561   697,327
  

Daniel J. Starck

   7,343   137,534

Retirement Compensation

We maintain market-competitive retirement programs for our executives as retirement compensation is an essential component of an overall market competitive total executive compensation package in that it provides security for the future needs of the executives and their families. TheOur NEOs are entitledeligible to participate in the Company’s 401(k) planPlan and receive Company matching contributions in the same manner as all other Company teammates.

The Company provides supplemental retirement benefits under a Supplemental Executive Retirement Plan (the “SERP”), as further described on page 59 of this proxy statement under “Retirement Plans—Supplemental Executive Retirement Plan.” At the time of its implementation in 1991, the SERP was designed to be competitive relative to defined benefit pension plans offered by other companies and to reward officers who provided long-term service to the Company, thereby promoting retention of highly performing executive talent. In 2012, the Compensation Committee amended the SERP to freeze both benefit levels and participants effective March 31, 2012, as part of an effort to make our overall executive compensation program more performance-based. Of the NEOs, Mr. Colpo is the only remaining participant in the SERP.

Deferred Compensation Plan

The Company has We also maintain an Executive Deferred Compensation and Retirement Plan into(“EDCP”) in which officersmembers of senior management and other management-level personnel maysenior-level teammates are eligible to participate. The EDCP permits participants to defer up to 75% of their base salary and up to 100% of their annual cash bonus. The purposeEDCP provides for similar investment options as our 401(k) Plan. For participants in the EDCP, the Company matches an additional 1% of the compensation deferred plan isinto the EDCP.

Owens & Minor, Inc.2024 Proxy Statement63


 Executive Compensation 

Other Benefits

In addition to the components of compensation discussed above, we provide security for current and future needs ofcertain other limited benefits to executives to help maximize the participants and their families by providing a tax efficient opportunitytime key executives are able to save for retirementspend on the Company’s business and to ensure that our executive compensation program remains competitive in the marketplace for key executive talent. These other benefits consist of the following and are specifically disclosed by amount in footnote (4) to the Summary Compensation Table on page 59 of this Proxy Statement: tax and financial planning and tax return preparation assistance, funding of life insurance policy premiums, an annual physical, and access to a concierge medical practice. In addition, NEOs may participate in our health and welfare plans and teammate stock purchase plan on the same basis as other full-time teammates. We do not provide tax gross-ups on any income executives may realize as a result of the foregoing benefits.

$70,835 in incremental costs to the Company for use of the corporate aircraft by our President & Chief Executive Officer was determined to be a perquisite in accordance with SEC rules. Our President & Chief Executive Officer does not receive tax reimbursement for any imputed income associated with personal travel on our corporate aircraft.

Pension Benefits

Our NEOs do not participate in any defined benefit pension plans.

Nonqualified Deferred Compensation Plan

The Company maintains an Executive Deferred Compensation and Retirement Plan (“EDCP”) in which members of senior management, talent. This planincluding our NEOs, and other certain management-level teammates are eligible to elect to defer portions of their compensation to save for retirement or other life events. The EDCP permits participants to defer up to 75% of their base salary and up to 100% of their annual cash incentive. The EDCP provides for similar investment options as under our 401(k) plan. For participantsPlan. The Company matches an additional 1% of the compensation deferred into the EDCP. EDCP accounts are paid out based on the participant’s election at the time of the deferral, subject to the requirements of Section 409A of the Internal Revenue Code, and may be paid in thisa lump sum, a series of annual installments, or monthly installment. Participants may elect to receive these distributions upon separation from service or upon the occurrence of one or more specified dates. All EDCP accounts are considered unfunded general contractual obligations and are subject to the claims of our general, unsecured creditors.

The Company maintains the Apria Deferred Compensation Plan (the “Apria DCP”), a nonqualified plan, into which Apria executives (participants prior to the Company’s acquisition of Apria, Inc. on March 29, 2022) may defer up to 50% of their salary, up to 75% of their annual bonus and 100% of their annual 401(k) plan refund offset amount. In 2023, the Company matches a totalmatched 100% of participant Apria DCP contributions, up to 5%3.5% of 401(k)the participant’s salary. Participants are 100% vested in matching contributions if they remain employed at the end of the applicable year. Apria DCP accounts are paid based on the participant’s election at the time of the deferral, subject to the requirements of Section 409A of the Internal Revenue Code, and deferred compensation planmay be paid in a lump sum or a series of annual installments. Participants may elect to receive these distributions upon separation from service or upon the occurrence of one or more specified dates. The Apria DCP was frozen at the end of 2023, and participants were given the opportunity to elect to participate in the EDCP for 2024.

64Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

The following table sets forth information regarding contributions combined; providedto, earnings on and total balances in the EDCP or Apria DCP, as applicable, for the NEOs in 2023.

      

(a)

(b)(c)(d)(e)(f)
      

Name

Executive
 Contributions 
in Last Fiscal Year
($)
Registrant
 Contributions 
in Last Fiscal Year
($)
(1)
 Aggregate 
Earnings
in Last
Fiscal Year
($)
(2)

  Aggregate  
Withdrawals/

Distributions
($)

Aggregate
 Balance at 
Last Fiscal
Year-End
($)
     

Edward A. Pesicka

 —   —  —    —  
     

Alexander J. Bruni

 —   —  —    —  
     

Andrew G. Long(3)

 —   —  $ 33,218  $198,276
     

Perry A. Bernocchi(4)

 $182,820 $6,981 $123,532  $940,834
     

Daniel J. Starck(5)

 —   —  $ 29,713  $192,417

(1)

Company contributions included in “All Other Compensation” for 2023 in the Summary Compensation Table.

(2)

Deferred amounts earned returns based on the performance of the funds into which they were invested, which consist of generally the same funds available to the participants under our 401(k) Plan.

(3)

Denotes previous Owens & Minor EDCP participant with earnings in 2023.

(4)

Denotes 2023 Owens & Minor EDCP participant with contributions and earnings in 2023.

(5)

Denotes Apria DCP participant in 2023, with earnings in 2023. The Apria DCP was frozen at the end of 2023.

Potential Payments Upon Termination or Change in Control

Officer Severance Policy

The Company has an Officer Severance Policy that applies to corporate officers whose employment is involuntarily terminated without cause (or who resign at the participant has first maximized contributionsrequest of the Company) in a non-change in control situation. The policy was designed to provide consistent and fair treatment of these departing officers. Receipt of payments under the 401(k) plan.severance policy is also conditioned upon the officer’s agreement to certain restrictive covenants and a general release of claims in favor of the Company. The officer severance policy provides for the following payments and benefits:

Officer Position

Severance AmountSeverance
Period
Other Benefits

Chief Executive Officer

President

Executive Vice President

Senior Vice President

1.5 x the sum of:

  Base salary

  The lower of average actual bonus paid or target bonus for the three calendar years prior to the date of termination

18 months

Lump sum payment for employer portion of COBRA premiums based on the active employee rates during severance period

Up to six months of outplacement services

Tax preparation and financial counseling services during severance period or until alternate employment begins

For purposes of the Officer Severance Policy, “cause” is generally defined to include one or more of the following by a corporate officer: (i) misappropriation, theft or embezzlement of funds or property from the Company, (ii) conviction of, or entry of a plea of “nolo contendere” with respect to, a felony, or a misdemeanor which, in the reasonable opinion of the Company, is likely to cause material harm to the Company’s business, customer or supplier relations, financial condition or prospects, (iii) violation of the Company’s Code of Honor or any successor code of conduct, (iv) violation of any material law or regulation to the detriment of the Company, (v) engagement in conduct that results in or would be reasonably likely to result in material injury to the reputation of the Company, or (vi) failure to substantially perform (other than by reason of illness, temporary disability or approved leave of absence) the duties of the officer’s job.

Owens & Minor, Inc.2024 Proxy Statement65


 Executive Compensation 

The officer severance policy imposes certain non-competition and non-solicitation restrictive covenants on the executive officers for the duration of the severance period and includes perpetual confidentiality provisions.

The severance policy does not address the disposition of outstanding equity awards upon an involuntary termination without cause. The treatment of outstanding equity awards is instead addressed in the applicable equity award agreements, as described in more detail on page 68 of this Proxy Statement below.

Change in Control Agreements

The Company has entered into change in control agreements (“CIC Agreements”) with its officers, including each of its NEOs (other than Mr. Starck, whose severance arrangements are described in more detail below). In 2018, the NEOs, as described on page 62Board approved a revised form of this proxy statement under “Potential Payments upon Termination or Change in Control—Change in Control Agreements.” the CIC Agreement for new executives first employed by the Company following the fall of 2018, which includes Messrs. Pesicka, Bruni, Long and Bernocchi.

The purpose of the CIC Agreements is to encourage key management personnel to remain with the Company and to help avoid distractions and conflicts of interest in the event of a potential or actual change in control of the Company so that executives will focus on a fair and impartial review of the acquisition proposal and the maximization of shareholder value despite the risk of losing their employment. The CompensationOP&C Committee believes that the CIC Agreements help it to attract and retain key executive talent that could have other employment alternatives that may appear to be less risky absent these arrangements. The CompensationOP&C Committee further believes that it hasthese CIC Agreements are appropriately structured these agreements to be reasonable and to provide a temporary level of income protection to the executive in the event of employment loss due to a change in control.

The CIC Agreements do not provide for excise taxgross-up payments. In addition, the severance payment obligation under the CIC Agreements has a “double trigger” such that the payment of a severance benefit may only be made if there is a qualifying change ofin control and the officer’sexecutive’s employment with the Company is terminated by the Company without cause“cause” or by the officerexecutive for good reason“good reason” within 24 months after such change in control. We believe that this structure strikes an appropriate balance betweencontrol, or if the incentives and the executive hiring and retention effects described above, without providing these benefits to executives who continue to enjoy employment with an acquiring company in the event of a change of control transaction. Annually in connection with the review of executive compensation tally sheets, the Compensation Committee reviews the severance amounts that would be payable to each NEO upon a change in control to ensure that the amounts are reasonable in light of the purpose of the agreements and relative to the marketplace generally. However, these amounts did not affect the Compensation Committee’s compensation decisions with regard to any specific element of our 2017 executive compensation program.

Equity awards have the same “double-trigger” feature discussed above for accelerated vesting and exercisability, as applicable, in the event of a change in control. These same terms apply to the equity awards of all other teammates in the Company upon a change in control.

The CIC Agreements renew on ayear-to-year basis unless terminated by the Company with a notice ofnon-renewal.

Severance Policy

We have a formal severance policy described on page 64 of this proxy statement under “Potential Payments upon Termination or Change in Control—Severance Policy” that applies to all corporate officers who are involuntarily terminated without cause (or who resign at the request of the Company). We adopted this policy to promote management stability and provide consistent and fair treatment to our departing officers in circumstances where their performance does not constitute cause for employment termination. We believe the severance policy helps the Company attract and retain key executive talent that could have other employment alternatives that may appear to be less risky absent such a policy. The severance policy is designed to provide the

officer with continued compensation and assistance for 18 months following dismissal in an effort to assist him or her in finding new employment and is conditioned upon the officer entering into anon-competition,non-solicitation and confidentiality agreement for the benefit of the Company.

Other Benefits

In addition to the components of compensation discussed above, we provide certain other limited benefits to executives, including the NEOs, to help maximize the time key executives are able to spend on the Company’s business; to reward experience, expertise, responsibility, seniority, leadership qualities and advancement; and to ensure that our executive compensation program remains competitive in the marketplace for key executive talent. These other benefits consist of the following and are specifically disclosed by amount in note 4 to the Summary Compensation Table on page 54 of this proxy statement: funding of life insurance policy premiums (provides security for current and future needs of the executives and their families), automobile allowance or lease (ensures transportation for business travel needs, recognizing that the automobile may also be used for personal purposes), tax and financial planning and tax return preparation assistance (allows executives to concentrate on business matters rather than on personal financial planning), and annual physical and enhanced medical access (identifies and addresses medical issues and helps preserve the Company’s investment in its executives by encouraging them to maintain healthy lifestyles and be proactive in addressing potential health issues). In addition, NEOs may participate in our health and welfare plans, 401(k) plan and teammate stock purchase plan on the same basis as other full-time teammates. Finally, except under limited and unusual circumstances, we only pay for executive travel on commercial or private aircraft when such travel is integrally and directly related to the performance of the executive’s duties for the Company and is not personal in nature. We do not provide taxgross-ups on any income executives may realize as a result of the foregoing benefits.

Recoupment Policy

In an effort to mitigate any imprudent risk-taking behavior associated with incentive compensation, the Company has a policy that permits the recoupment of performance-based cash and equity compensation paid to executive officers. This compensation is recoverable from an executive officer if:

(i)The payment or award was predicated upon the achievement of certain financial results that were subsequently the subject of a restatement of the Company’s financial statements;

(ii)The Board (or its designated Compensation Committee) determines that the executive engaged in misconduct that caused or substantially caused the need for the restatement; and

(iii)A lower payment would have been made to the executive officer based upon the restated financial results.

If the foregoing conditions are met, as determined by the Board (or its designated committee), the Company, under terms of the applicable program or award agreements, will recover from the executive officer the amount by which his or her performance-based compensation for the relevant period exceeded the amount (if any) that would have been paid based on the restated financial results. The Board (or its designated committee) may take such further action as it deems necessary or appropriate to remedy the misconduct and prevent its recurrence. The recoupment policy currently will not apply to performance-based compensation after the second anniversary of the date on which such compensation was paid. We continue to monitor additional requirements that may be imposed pursuant to Section 304 under the Sarbanes-Oxley Act of 2002 and that would lead to modification of this policy to the extent required by the Dodd-Frank Act of 2010 and the related final rules of the SEC.

Hedging and Derivatives Trading Prohibition

The Company has policies that prohibit directors, officers and other teammates with access to confidential information of the Company from engaging in certain transactions relating to our common stock, including buying or selling options and short sales. We also prohibit these individuals from hedging the economic risk of ownership of our common stock and holding our stock in a margin account or pledging our stock as collateral for a loan.

Tax Considerations

Section 162(m) of the Internal Revenue Code generally precludes a tax deduction by any publicly-held company for compensation paid to any “covered employee” to the extent the compensation paid to such covered employee exceeds $1 million during any taxable year of the company. The Tax Cuts and Jobs Act of 2017 was enacted in the United States in December 2017 and included changes to Section 162(m) effective for years beginning in and after 2018. Prior to 2018, “covered employees” included the Chief Executive Officer of the company and the three other highest paid officers of the company (other than the Chief Financial Officer). For 2018 and later years, “covered employees” will include the Chief Executive Officer of the company, the Chief Financial Officer of the company, the three highest paid officers of the company (other than the Chief Executive Officer and the Chief Financial Officer) and any employee who qualified as a “covered person” for any tax year beginning after 2016. For years beginning prior to January 1, 2018, the $1 million deduction limit did not apply to “qualified performance-based compensation” that is based on the attainment ofpre-established, objective performance goals established under a stockholder-approved plan. Effective for the years beginning on or after January 1, 2018, there is no exception for “qualified performance-based compensation” from the Section 162(m) limitation; but, a transition rule provides that the “qualified performance-based compensation” exemption will continue to apply to awards that are made pursuant to a binding contract in effect on or before November 2, 2017, that is not materially modified thereafter. A number of requirements must be met under Section 162(m) in order for particular compensation to so qualify for the exception such that there can be no assurance that “qualified performance-based” compensation will be fully deductible under all circumstances. We believe that it is important to preserve flexibility in administering compensation programs to promote various corporate goals. Accordingly, we have not adopted a policy that all compensation must qualify as deductible under Section 162(m). Amounts paid under our compensation programs may not be deductible as the result of Section 162(m). While our policy is generally to preserve corporate tax deductions by qualifying compensation over $1 million paid to executive officers as performance-based, the Compensation Committee may, from time to time, conclude that compensation arrangements are in our best interests and the best interests of our shareholders despite the fact that such arrangements might not, in whole or part, qualify for tax deductibility. We intend to design our executive compensation arrangements to be consistent with our best interests and the interests of our shareholders. To the extent we determine it to be consistent with our best interests and the interests of our shareholders, we intend to preserve, to the extent practicable, the applicability of the transition rule to awards that were granted on or before October 2, 2017. However, there is no guaranty that such transition status can or will be applicable.

REPORT OF THE COMPENSATION & BENEFITS COMMITTEE

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis contained in this proxy statement. Based on this review and discussion, the committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into the Company’s Annual Report on Form10-K for the year ended December 31, 2017.

THE COMPENSATION & BENEFITS COMMITTEE

Robert C. Sledd, Chairman

Barbara B. Hill

Martha H. Marsh

James E. Rogers

David S. Simmons

SUMMARY COMPENSATION TABLE

The following table summarizes for the years ended December 31, 2017, 2016 and 2015, as applicable, the total compensation of our NEOs—our Chief Executive Officer, Chief Financial Officer, and our three other most highly compensated executive officers.

(a)(b)(c)(d)(e)(f)(g)(h)(i)(j)

Name and Principal

Position

YearSalary ($)

Bonus

($)

Stock
Awards

(1)

($)

Option
Awards
(1)

($)

Non-Equity
Incentive Plan
Compensation (2)
($)

Change in
Pension
Value and

Non-Qualified
Deferred
Compensation
Earnings (3)
($)

All Other
Compensation
(4)

($)

Total

($)

P. Cody Phipps (5)

Chairman, President & Chief Executive Officer


2017

2016

2015


$

922,500

915,577

443,117


$

—  

—  

1,125,000


$

5,000,001

3,999,994

7,000,022


$

—  

—  

—  


$

383,991

1,083,939

217,125



—  

—  

—  


$

375,543

263,869

107,292


$

6,682,035

6,263,379

8,892,556


Richard A. Meier (6)

Executive Vice

President, CFO &

President, International


2017

2016

2015


$

653,162

648,260

614,765


$

—  

—  

—  


$

1,050,044

699,999

1,632,526


$

—  

—  

—  


$

163,127

460,480

471,154



—  

—  

—  


$

299,116

155,869

182,896


$

2,165,449

1,964,608

2,901,341


Stuart Morris-Hipkins

Executive Vice President, Global Manufacturer Services


2017

2016

2015


$

335,096

—  

—  


$

100,000

—  

—  


$

1,335,037

—  

—  


$

—  

—  

—  


$

91,730

—  

—  



—  

—  

—  


$

67,331

—  

—  


$

1,926,194

—  

—  


Charles C. Colpo

Senior Vice President,

Strategic Supplier Management


2017

2016

2015


$

456,895

453,466

471,739


$

—  

—  

—  


$

467,979

311,994

390,002


$

—  

—  

—  


$

76,073

214,742

265,892


$

—  

225,265

—  


$

829,467

535,319

623,499


$

1,830,414

1,740,786

1,751,132


Rony C. Kordahi

Executive Vice President, North American Operations


2017

2016

2015


$

450,000

328,846

—  


$

—  

—  

—  


$

1,050,044

1,099,993

—  


$

—  

—  

—  


$

104,895

222,076

—  



—  

—  

—  


$

52,334

71,592

—  


$

1,657,273

1,722,507

—  


(1) The amounts included in column (e) are the aggregate grant date fair value of the awards computed in accordance with FASB ASC Topic 718, and column (e) includes awards subject to performance conditions. Of the total awards reflected in column (e) for 2017, the amount specified below for each officer represents awards subject to performance conditions, which are valued at the grant date based on probable achievement at target levels:

Mr. Phipps, $2,999,993; Mr. Meier, $700,030; Mr. Morris-Hipkins, $700,017; Mr. Colpo, $311,986; Mr. Kordahi, $700,030.

The grant date value of the above performance-based awards for 2017 would equal the following for each officer assuming achievement of the highest level of performance conditions:

Mr. Phipps, $5,999,986; Mr. Meier, $1,400,060; Mr. Morris-Hipkins, $1,400,034; Mr. Colpo, $623,988; Mr. Kordahi, $1,400,060.

For Mr. Phipps, the 2015 amount includes aone-time “sign on” grant of $5,000,006 of restricted stock. For Mr. Meier, the 2015 amount includes a “special” grant of $1,000,009 of restricted stock. For Mr. Kordahi, the 2016 amount includes a“sign-on” grant of $400,011 of restricted stock. For Mr. Morris-Hipkins, the 2017 amount includes a“sign-on” grant of $285,004 of restricted stock.

Assumptions used in the calculation of the stock awards included in column (e) are included in note 12 to the consolidated financial statements included in the Company’s Annual Report on Form10-K for the year ended December 31, 2017, which is incorporated herein by reference. The actual value an NEO may receive for stock awards depends on market prices, and there can be no assurance that the amounts shown are the amounts that will be realized.

(2) The amounts included in column (g) reflect cash awards to the NEOs under the Company’s performance-based annual incentive programs for 2017, 2016 and 2015. Mr. Morris-Hipkins’ 2017 cash award ispro-rated based on time in position during 2017 (10 months). Further information on awards made under the 2017 Annual Incentive Program is provided under “Compensation Discussion and Analysis—Annual Incentives” on page 43 of this proxy statement.

(3) The amounts included in column (h) reflect the actuarial increase in the present value of the NEO’s benefits under the Company’s Supplemental Executive Retirement Plan (“SERP”) during 2017, 2016 and 2015 determined using interest rate and mortality rate assumptions consistent with those used in the Company’s financial statements. SERP benefits were frozen effective March 31, 2012, and none of Messrs. Phipps, Meier, Morris-Hipkins and Kordahi participate in the SERP. For additional information on the Company’s retirement plans, see “Retirement Plans” on page 59 of this proxy statement. No NEO received preferential or above-market earnings on deferred compensation.

(4) For 2017, the amounts included in column (i) consist of the following benefits or Company contributions attributable to the following:

   Car Lease
or
Allowance
  Tax
Planning/
Return
Preparation
  

Dividends on
Restricted Stock

Awards (a)

  Life
Insurance
Premiums
  

Deferred
Compensation
Plan and 401(k)
Plan

Company

Match

  Annual
Physical/
Medical
Access
  

Other

(f)

  Total 

P. Cody Phipps

 $15,250  $8,945  $334,643  $1,355 $13,250  $2,100  $0  $375,543 

Richard A. Meier (b)

  9,600   —     86,309   1,355  56,180   1,050   144,622   299,116 

Stuart Morris-Hipkins (c)(e)

  6,890   —     18,270   394  1,962   1,050   38,765   67,331 

Charles C. Colpo (d)

  32,131   500   35,196   6,031   13,250   1,050   741,309   829,467 

Rony C. Kordahi

  9,600   0   27,790   644  13,250   1,050   0   52,334 

(a)Amounts included in this column represent dividends paid on Restricted Stock Awards, accumulated dividend equivalents paid on earned Performance Shares and/or dividend equivalents paid on Restricted Stock Units. Amounts for 2015 and 2014 were: Mr. Phipps—$224,528 for 2016 and $89,118 for 2015; Mr. Meier—$78,291 for 2016 and $65,023 for 2015; Mr. Colpo—$25,643 for 2016 and $10,862 for 2015; Mr. Kordahi—$12,566 for 2016.

(b)Mr. Meier’s other compensation represents relocation costs paid by the Company in 2017.

(c)Mr. Morris-Hipkins’s other compensation represents relocation costs paid by the Company in 2017.

(d)Included in Mr. Colpo’s other compensation are the following amounts paid or attributed to him in connection with his temporary relocation to the United Kingdom to manage our European operations: $540,864 in tax equalization payments, $97,036 ingross-up payments, $79,451 in housing allowance and related costs, and $21,905 in cost of living allowance.

(e)Mr. Morris-Hipkins joined the Company as Executive Vice President, Global Manufacturer Services, on March 13, 2017.

(f)Unless otherwise provided with respect to an NEO, includes miscellaneous amenities and/or awards provided at Company sales and leadership conferences and other awards or gifts.

(5) Mr. Phipps joined the Company as its President & Chief Executive officer effective July 1, 2015.

(6) Mr. Meier assumed the additional role of President, International effective July 1, 2015.

(7) The amounts included in column (d) reflect special or guaranteed bonus payments. As part of his offer of employment, Mr.  Morris-Hipkins received a“sign-on” cash bonus of $100,000.

GRANTS OF PLAN BASED AWARDS TABLE

The following table shows awards granted to the NEOs during the year ended December 31, 2017.

(a) (b)  (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j)  (k)  (l) 
Name Grant
Date
  

Estimated Future Payouts Under
Non-Equity Incentive Plan Awards

(1)

  

Estimated Potential Payouts Under
Equity Incentive Plan Awards

(2)

  All Other
Stock
Awards:
Number
of
Shares
of Stock
or
Units (3)
(#)
  All Other
Option
Awards:
Number of
Securities
Underlying
Options (4)
(#)
  Exercise
or Base
Price of
Option
Awards
($ /Sh)
  Grant
Date
Fair
Value of
Stock
and
Option
Awards
(5)
 
   
Threshold
($)

 
  
Target
($)

 
  
Maximum
($)

 
  
Threshold
(#)

 
  
Target
(#)

 
  
Maximum
(#)

 
    

P. Cody Phipps

  2/9/17              1   55,695   111,390           $2,000,007 
   2/9/17                     55,695         2,000,007 
   2/9/17               27,847   55,694            999,986 
   N/A  $403,594  $864,844  $2,306,250                      
                                             

Richard A. Meier

  2/9/17              1   9,747   19,494           $350,015 
   2/9/17               9,747   19,494            350,015 
   2/9/17                     9,747         350,015 
   N/A   $171,455   $367,404   $979,743                      
                                             

Stuart Morris-Hipkins

  3/13/17              1         9,777        $350,017 
   3/13/17                     7,961         285,004 
   3/13/17               9,777   19,554            350,017 
   5/5/17               10,674   21,348            350,000 
   N/A   $104,125   $223,125   $595,000                      
                                             

Charles C. Colpo

  2/9/17              1         4,344        $155,993 
   2/9/17               4,344   8,688            155,993 
   2/9/17               4,344   8,688            155,993 
   N/A   $79,957   $171,336   $456,895                      
                                             

Rony C. Kordahi

  2/9/17                     9,747        $350,015 
   2/9/17              1   9,747   19,494            350,015 
   2/9/17               9,747   19,494            350,015 
   N/A   $110,250   $236,250   $630,000                      
                                             

(1) The amounts shown in column (c) reflect the minimum payment level under the Company’s 2017 Annual Incentive Program if minimum performance conditions were met and represents 47% of the target payment level shown in column (d) which is based on meeting target performance conditions. The amount shown in column (e) is 200% of the target payment level and is based on meeting maximum performance conditions. These amounts are based upon the individual’s 2017 salary and position (125% of base salary for Mr. Phipps,

75% of base salary for Mr. Meier, 70% of base salary for Mr. Stuart Morris-Hipkins, 50% of base salary for Mr. Colpo, and 70% of base salary for Mr. Kordahi). Payouts under the 2017 Annual Incentive Program are set forth in the “Summary Compensation Table” under“Non-Equity Incentive Plan Compensation” on page 54 of this proxy statement.

(2) The amounts shown in column (f) reflect the minimum restricted stock award level under 2017 performance share grants if minimum performance conditions are met. The target restricted stock award level shown in column (g) is based on meeting target performance conditions and the maximum level shown in column (h) is 200% of the target restricted stock award level and is based on meeting the maximum performance conditions. These restricted stock awards are based on the Company’s achievement of average return on capital employed and adjusted diluted EPS goals for 2017 and 2018 as discussed on page 48 of this proxy statement and, if earned, vest on the third anniversary of the performance share grant. Dividends are not paid on performance share grants unless and until the performance conditions are satisfied, resulting in the issuance of the underlying restricted stock.

(3) The amounts shown in column (i) represent grants of restricted stock that vest one to five years from the date of grant based on the executive’s continued employment with the Company. Dividends are paid on outstanding restricted stock grants at the same rate as for all shareholders of record.

(4) No stock options were granted by the Company in 2017.

(5) The amounts shown in column (l) are the grant date fair value of each individual equity award computed in accordance with FASB ASC Topic 718.

OUTSTANDING EQUITY AWARDS AT FISCALYEAR-END TABLE

The following table summarizes for each NEO information regarding unexercised stock options, unvested restricted stock awards and incentive plan awards outstanding as of December 31, 2017.

   Option Awards  Stock Awards 
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j) 
   Number of
Securities
Underlying
Unexercised
Options
(#)
  Number of
Securities
Underlying
Unexercised
Options
(#)
  

Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options

(#)

  Option
Exercise
Price
($)
  Option
Expiration
Date
  

Number of
Shares or
Units of
Stock That
Have Not
Vested

(#) (1)

  

Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested

($) (2)

  

Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units

or Other

Rights
That
Have Not
Vested

(#) (3)

  

Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units
or Other
Rights
That
Have Not
Vested

($) (3)

 
Name Exercisable  Unexercisable        

P. Cody Phipps

  

—  

—  

—  

—  

—  

 

 

 

 

 

  

—  

—  

—  

—  

—  

 

 

 

 

 

  

—  

—  

—  

—  

—  

 

 

 

 

 

  

—  

—  

—  

—  

—  

 

 

 

 

 

  

—  

—  

—  

—  

—  

 

 

 

 

 

  

55,695

31,765

58,360

88,236

29,412

 

 

 

 

 

 $

 

1,051,522

599,723

1,101,837

1,665,896

555,299

 

 

 

 

 

  

27,847

55,695

58,360

—  

—  

 

 

 

 

 

 $

 

525,751

1,051,522

1,101,837

—  

—  

 

 

 

 

 

Total 

  —     —     —     —     —     263,468   4,974,276   141,902   2,679,110 

Richard A. Meier

  

—  

—  

—  

—  

—  

—  

 

 

 

 

 

 

  

—  

—  

—  

—  

—  

—  

 

 

 

 

 

 

  

—  

—  

—  

—  

—  

—  

 

 

 

 

 

 

  

—  

—  

—  

—  

—  

—  

 

 

 

 

 

 

  

—  

—  

—  

—  

—  

—  

 

 

 

 

 

 

  

9,747

11,455

10,213

7,071

2,692

16,420

 

 

 

 

 

 

 $

 

184,023

216,270

192,821

133,500

50,825

310,010

 

 

 

 

 

 

  

9,747

9,747

10,213

—  

—  

—  

 

 

 

 

 

 

 $

 

184,023

184,023

192,821

—  

—  

—  

 

 

 

 

 

 

Total 

  —     —     —     —     —     57,598   1,087,450   29,707   560,868 

Stuart Morris-Hipkins

  

—  

—  

 

 

  

—  

—  

 

 

  

—  

—  

 

 

  

—  

—  

 

 

  

—  

—  

 

 

  

9,777

7,961

 

 

 $

 

150,304

184,590

 

 

  

10,674

9,777

 

 

 $

 

201,525

184,590

 

 

Total 

  —     —     —     —     —     17,738   334,893   20,451   386,115 

Charles C. Colpo

  

—  

—  

—  

—  

 

 

 

 

  

—  

—  

—  

—  

 

 

 

 

  

—  

—  

—  

—  

 

 

 

 

  

—  

—  

—  

—  

 

 

 

 

  

—  

—  

—  

—  

 

 

 

 

  

4,344

7,063

4,360

—  

 

 

 

 

 $

 

82,015

133,349

85,942

82,317

 

 

 

 

  

4,344

4,344

4,552

—  

 

 

 

 

 $

 

82,015

82,015

85,942

—  

 

 

 

 

Total 

  —     —     —     —     —     20,319   383,623   13,240   249,971 

Rony C. Kordahi

  

—  

—  

—  

 

 

 

  

—  

—  

—  

 

 

 

  

—  

—  

—  

 

 

 

  

—  

—  

—  

 

 

 

  

—  

—  

—  

 

 

 

  

9,747

9,926

6,474

 

 

 

 $

 

184,023

187,403

122,229

 

 

 

  

9,747

9,747

9,926

 

 

 

 $

 

184,023

184,023

187,403

 

 

 

Total 

  —     —     —     —     —     26,147   493,655   29,420   555,450 

(1) Shares of restricted stock vest fully either three or five years from the date of grant. Vesting dates for the shares of restricted stock listed for each officer range from January 2018 to July 2020.

(2) The market value of the restricted shares was calculated based on $18.88 per share, the closing price of the Company’s Common Stock on December 31, 2017. Dividends are paid on outstanding shares of restricted stock at the same rate as paid to all shareholders of record.

(3) The amounts in column (i) represent the number of performance shares outstanding based on the achievement of the target level of performance conditions. The market value of the performance shares was calculated based on $18.88 per share, the closing price of the Company’s Common Stock on December 31, 2017. Dividends are not paid on performance shares unless and until the underlying performance conditions are achieved.

OPTION EXERCISES AND STOCK VESTED TABLE

The following table sets forth for each NEO information on stock option exercises and vesting of restricted stock on an aggregated basis during the year ended December 31, 2017.

    Option Awards   Stock Awards 
(a)  (b)   (c)   (d)   (e) 
Name  

Number of Shares

Acquired on Exercise

(#)

   

Value Realized

on Exercise

($)

   

Number of Shares

Acquired on Vesting

(#)

   

Value Realized

on Vesting

($) (1)

 

P. Cody Phipps

   —      —      29,412   $946,772 

Richard A. Meier

   —      —      26,183    881,093 

Stuart Morris-Hipkins

   —      —      —      —   

Charles C. Colpo

   —      —      6,902    248,472 

Rony C. Kordahi

   —      —      3,335    114,491 

(1) The value realized on vesting is computed by multiplying the number of shares vesting by the market price of the underlying shares on the vesting date.

RETIREMENT PLANS

Supplemental Executive Retirement Plan

The Company provides supplemental retirement benefits to certain officers, including Mr. Colpo, under the SERP. Effective March 31, 2012, the Board of Directors amended the SERP to freeze benefit levels under the plan and participation by future executives. The SERP entitles participants who meet its age and service requirements to receive a specified percentage (60%) of the participant’s average base monthly salary plus bonus for the highest consecutive five out of the last 10 years preceding March 31, 2012. The SERP benefit to which a participant is entitled is reduced by any benefit payable under Social Security, defined benefit pension plans and the benefit attributable to certain Company contributions under the Company’s 401(k) plan. The SERP provides for full benefits to participants who retire at or after the attainment of the age of 65 (or at or after the age of 62 with 20 years of service) and provides for reduced benefits to participants who retire between the ages of 55 and 64 if their age plus years of service to the Company equal at least 70. If a participant retires prior to age 65 (or prior to age 62 with 20 years of service), his or her otherwise applicable full retirement benefit is reduced by 0.333% for each month remaining from the date of retirement until the participant would reach age 65. SERP payments are made to an eligible participant until his or her death (and, following the participant’s death, will continue to be made to the participant’s beneficiary unless or until a total of 180 payments have been made under the SERP to either the participant or his or her beneficiary). Upon retirement, participants are no longer eligible to participate in the Company’s medical insurance or benefit plans (except as legally required under COBRA). In consideration for receiving benefits under the SERP, the participant must comply with anon-competition agreement during employment and for a period of five years following employment by the Company.

Pension Benefits Table

The following table shows the actuarial present value of accumulated benefits payable to each of the NEOs as of December 31, 2017, including the number of years of service credited to each such NEO, under the SERP using interest rate and mortality rate assumptions consistent with those used in the Company’s financial statements. Benefits under the SERP are payable as a monthly annuity.

(a)  (b)  (c)  (d)  (e)
Name  Plan Name    Number of Years  
Credited Service  
(#)  
  

Present Value  
of Accumulated  
Benefit  

($) (1)  

  

Payments During Last

Fiscal Year

($)

P. Cody Phipps

  N/A  —    —    —  

Richard A. Meier

  N/A  —    —    —  

Stuart Morris-Hipkins

  N/A  —    —    —  

Charles C. Colpo

  SERP  36  $4,134,577  —  

Rony C. Kordahi

  N/A  —    —    —  

(1) Mr. Colpo is the only NEO who participates in the SERP. The annual benefit payable under the SERP upon retirement at normal retirement age for Mr. Colpo is $316,656. The calculation of present value of accumulated benefit assumes a discount rate of 3.25% and was based on theRP-2014 Mortality Table,MP-2017 Projection Scale. For a discussion of the assumptions used by the Company in calculating these amounts, see note 13 to the consolidated financial statements included in the Company’s Annual Report on Form10-K for the year ended December 31, 2017, which is incorporated herein by reference.

Following retirement, stock options and restricted stock awards continue to vest pursuant to the terms of the respective grants if, at the discretion of the Company, the officer continues to serve the Company as a director, in a consulting capacity or by entering into anon-solicitation and confidentiality agreement for the benefit of the Company. An officer is eligible following retirement to receive a portion of any performance shares earned based on achievement of the performance conditionspro-rated for the number of months worked during the performance period. Performance shares were valued based upon assumed performance at the target level. Assuming continued service to the Company, each of the NEOs would receive the following estimated benefit due to continued vesting of equity awards if he or she had been eligible to and actually retired on December 31, 2017: Mr. Phipps, $6,205,265; Mr. Meier, $1,333,548; Mr. Morris-Hipkins, $452,699; Mr. Colpo, $493,306; and Mr. Kordahi, $736,238. This benefit is calculated based upon the number of shares subject to continued vesting multiplied by $18.88, the closing price of the Company’s Common Stock on December 29, 2017. Performance shares were valued based upon assumed performance at the target level.

Nonqualified Deferred Compensation Plan

The Company maintains an Executive Deferred Compensation and Retirement Plan in which members of senior management and other management-level teammates are eligible to participate. This plan permits participants to defer base salary (up to 75%) and cash bonus (up to 100%) paid during a year for which a deferral election is made. This plan provides for similar investment options as under our 401(k) plan. The Company matches a total of up to 5% of combined 401(k) plan and deferred compensation plan contributions, provided that the participant has first maximized permitted contributions under the 401(k) plan. The following table sets forth information regarding contributions to, earnings on and total balances in the Executive Deferred Compensation plan for the NEOs in 2017.

(a)  (b)   (c)   (d)   (e)  (f) 

Name

   



Executive
Contributions
in Last Fiscal
Year

($) (1)




 

 

   


Registrant
Contributions
in Last

Fiscal Year

($) (2)



 

 

 

   




Aggregate
Earnings
(Losses)

in Last
Fiscal
Year

($) (3)



 



 

 

  

 

Aggregate 
Withdrawals / 
Distributions 

($) 

   


Aggregate
Balance
at

Last Fiscal

Year-End

($)



 

 

 

 

P. Cody Phipps

  $—     $—     $—     —    $—   

Richard A. Meier

   33,815    42,721    74,859   —     415,116 

Stuart Morris-Hipkins

   —      —      —     —     —   

Charles C. Colpo

   —      —      —     —     —   

Rony C. Kordahi

   —      —      —     —     —   

(1) Executive contributions that can be deferred may include up to 75% of base salary and 100% of annual incentive cash compensation.

(2) Company contributions included in “All Other Compensation” for 2017 in the Summary Compensation Table.

(3) Deferred amounts earned returns based on the performance of the funds into which they were invested, which consist basically the same funds available to the participants under our 401(k) plan.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

The following table reflects the estimated potential compensation payable to each of the NEOs under the Company’s compensation and benefit plans and arrangements in the event of termination of such executive’s employment under various scenarios, including voluntary termination without cause, voluntary termination or involuntary termination with cause, termination following a change in control and termination due to disability or death. Benefits payable to the NEOs upon retirement are described under “Retirement Plans” beginning on page 59 of this proxy statement. The amounts shown are estimates of the amounts that would be paid out to the executives upon termination of their employment assuming that such termination was effective December 31, 2017.

   

Cash Severance

Payment

($)

  Incremental
Pension Benefit
(present value)  (5)
($)
  Continuation
of Medical /
Welfare Benefits
(present value)
($)
  

Acceleration and

Continuation

of Equity

Awards (6)

($)

  

Total Termination

Benefits

($)

 

P. Cody Phipps (1)

                    

•           Involuntary Termination Without Cause (2)

 $3,113,438  $—    $51,749  $3,169,964  $6,335,152 

•           Voluntary Termination or Involuntary Termination With Cause

  —     —     —     —     —   

•           Involuntary or Good Reason Termination after Change In Control (3)

  6,385,240   —     38,999   9,184,063   15,608,301 

•           Disability (4)

  2,855,376   —     —     4,400,954   7,256,330 

•           Death (4)

  —     —     —     7,653,386   7,653,386 

Richard A. Meier (1)

                    

•           Involuntary Termination Without Cause (2)

 $1,474,884  $—    $31,570  $838,027  $2,344,481 

•           Voluntary Termination or Involuntary Termination With Cause

  —     —     —     —     —   

•           Involuntary or Good Reason Termination after Change In Control (3)

  2,640,009   —     35,093   1,977,982   4,653,084 

•           Disability (4)

  1,125,306   —     —     1,084,125   2,209,430 

•           Death (4)

  —     —     —     1,648,318   1,648,318 

Stuart Morris-Hipkins (1)

                    

•           Involuntary Termination Without Cause (2)

 $637,500  $—    $29,007  $124,572  $791,080 

•           Voluntary Termination or Involuntary Termination With Cause

  —     —     —     —     —   

•           Involuntary or Good Reason Termination after Change In Control (3)

  1,270,750   —     31,677   865,210   2,167,637 

•           Disability (4)

  320,002   —     —     242,377   562,379 

•           Death (4)

  —     —     —     721,008   721,008 

Charles C. Colpo (1)

                    

•           Involuntary Termination Without Cause (2)

 $947,402  $—    $49,729  $277,283  $1,274,414 

•           Voluntary Termination or Involuntary Termination With Cause

  —     —     —     —     —   

•           Involuntary or Good Reason Termination
after Change In Control (3)

  1,888,489   299,369   59,306   760,313   3,007,476 

•           Disability (4)

  259,306   —     —     386,966   646,273 

•           Death (4)

  —     —     —     633,594   633,594 

   

Cash Severance

Payment

($)

  Incremental
Pension Benefit
(present value)  (5)
($)
  Continuation
of Medical /
Welfare Benefits
(present value)
($)
  

Acceleration and

Continuation

of Equity

Awards (6)

($)

  

Total Termination

Benefits

($)

 

Rony C. Kordahi (1)

                    

•           Involuntary Termination Without Cause (2)

 $1,008,113  $—    $29,361  $256,401  $1,293,875 

•           Voluntary Termination or Involuntary Termination With Cause

  —     —     —     —     —   

•           Involuntary or Good Reason Termination after Change In Control (3)

  2,009,505   —     32,148   1,258,926   3,300,579 

•           Disability (4)

  382,501   —     —     498,984   881,485 

•           Death (4)

  —     —     —     1,049,105   1,049,105 

(1) The amounts shown in the table do not include accrued salary and vacation payable through the date of the executive’s employment termination or the distribution of any balances under the Executive Deferred Compensation Plan or the Company’s 401(k) plan.

(2) See the discussion of the Company’s severance policy below for information on benefits payable to the NEOs upon involuntary termination without cause. The calculation of cash severance is based on 1.5 multiplied by the sum of the NEO’s base annual salary and the lower of average bonus paid or target bonus for the three calendar years prior to the date of employment termination.

(3) See the discussion of the Company’s change in control agreements on page 64 for information on benefits payable to the NEOs upon a change in control. The calculation of cash severance is based on a lump sum payment of 2.99 multiplied by the sum of annual salary plus the average of the last three years’ actual bonuses paid.

(4) A termination of employment due to death or disability entitles the NEOs to benefits under the Company’s life insurance or disability plan, as applicable, available to salaried teammates generally. In addition, and also as applicable to salaried employees generally who receive grants of stock options and restricted stock, upon termination of employment due to death, all stock options and shares of restricted stock immediately vest; and, upon termination of employment due to disability, unvested stock options are forfeited and shares of restricted stock vest on a pro rata basis. In addition, upon death, officers are entitled to receive performance shares that are actually earned based on achievement of performance conditions and, upon disability, a pro rata portion of any such shares earned relative to time worked during the performance period.

(5) If a participant’s employment is terminated without cause or the participant resigns for good reason following“cause” within 90 days prior to a change in control, the SERP provides for apro-rated benefit based on credited years of service relative to years of service remaining to the participant’s earliest retirement eligibility date, which amount is reduced by 4% for each year that the participant is under age 65. The amounts in this column show the present value of any additional benefit to the participant relative to the present value of accumulated benefits shown in the “Pension Benefits Table” on page 60.

(6) The amounts in this column represent the estimated benefit to the NEO due to accelerated vesting of equity awards and are calculated based on the number of shares subject to accelerated vesting multiplied by $18.88, the closing price of the Company’s Common Stock on December 29, 2017. Any performance shares that vest are valued based upon assumed performance at the target level.

Severance Policy. The Company has an officer severance policy that applies to corporate officers who are involuntarily terminated without cause (or who resign at the request of the Company) and that was designed to provide consistent and fair treatment of these departing officers. Receipt of payments under the severance policy is also conditioned upon the officer’s agreement to certainnon-competition andnon-solicitation restrictive covenants for the term of the severance period and a general release of claims against the Company. The Company provides for the following under its officer severance policy:

Officer PositionSeverance Amount

Severance

Period

Other Benefits

CEO

President

Chief Operating Officer

Executive Vice President

Senior Vice President

1.5 x the sum of:

•  Base Salary

•  The lower of average Bonus paid or Target Bonus for the three calendar years prior to date of employment termination

18 months

Continuation of Medical/Dental/Vision Benefits during severance period

Up to six months of outplacement services

Tax preparation and financial counseling services during severance period

Vice President

1.0 x the sum of:

•  Base Salary

•  The lower of average Bonus paid or Target Bonus for the three calendar years prior to date of employment termination

12 months

Continuation of Medical/Dental/Vision Benefits during severance period

Up to six months of outplacement services

Any termination of Mr. Phipps’ employment with the Company following the expiration of the Initial Period shall be subject to the Company’s executive severance policy existing at the time of such termination, and Mr. Phipps shall be entitled to severance benefits only in accordance with such policy.

The severance policy does not address the disposition of outstanding stock options or stock awards upon involuntary termination without cause, which event is addressed under the applicable equity award agreement. In general, upon an involuntary termination without cause (or resignation at the request of the Company), (i) an officer’s unvested stock options are forfeited and the vested stock options must be exercised within a period of one year from the date of employment termination, and (ii) a pro rata portion of the officer’s restricted stock awards and earned performance share awards (as applicable) vests at the date of employment termination based on the number of months worked during the applicable vesting and/or performance period.

Change in Control Agreements. The Company has entered into CIC Agreements with the NEOs, the purpose of which is to encourage key management personnel to remain with the Company and to avoid distractions resulting from potential or actual changes in control of the Company.

The CIC Agreements provide for the payment of a severance benefit if the officer’s employment with the Company is terminated within 24 months after a change in control unless such termination is (i) due to death or disability, (ii) by the Company for cause or (iii) by the officer other than in specified circumstances constituting good reason.control.

Termination of employment by the Company is for cause“cause” if it is because of the executive officer’s (i) willful and continued failure to substantially perform his or her duties (other than due to incapacity, illness, etc.) or (ii) willful engaging in conduct demonstrably and materially injurious to the Company. TerminationFor purposes of employment bythe CIC Agreements, “good reason” generally includes, after a change in control, without the executive officer is for good reason if it is because of (i)officer’s written consent, (a) a material diminution in authority, duties or

responsibilities; (ii)(b) a material reduction in annual base salary and/or target bonus opportunity or benefits; (iii)opportunity; (c) a relocation of place of employment by more than 35 miles or substantial increase in travel obligations; (iv)(d) a failure to pay compensation due to the executive officer; (e) a change in the executive officer’s reporting relationship; (f) the failure of the Company to obtain a satisfactory agreement from any successor to assume the CIC Agreements; or (v) certain other reasons(g) any termination of employment that is not effected pursuant to a Notice of Termination (as defined in the plan.CIC Agreements). In each case, “cause” and “good reason” are subject to certain notice and cure rights.

A change in control is generally deemed to have occurred under the agreements:CIC Agreements:

 

(i)if

If any person acquires 30% or more of the Company’s voting securities (other than the Company or its affiliates)subsidiaries); except that, for the purposes of determining whether a change in control has occurred under the terms of the Company’s outstanding equity award agreements, shares issued by the Company directly to the acquirer shall not be taken into account when determining whether the 30% threshold has been met;

 

(ii)if

If the Company’s directors as of the beginningcommencement or renewal date of the CIC Agreement (the “Incumbent Board”) cease to constitute a majority of the Board (unless the members’ nominations or elections were approved by a majority of the Incumbent Board);

 

(iii)upon

Upon the approval by shareholders of a merger or consolidation of the Company (or any subsidiary) other than (a) a merger or consolidation whichthat would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent more than 50% of the voting power of the securities of the Company (or surviving entity) outstanding immediately after the merger or consolidation, or (b) a merger or consolidation effected to implement a recapitalization of the Company in which no person acquires more than 30% of the combined voting power of the Company’s then-outstanding securities; or

 

(iv)upon

Upon the approval by shareholders of a plan of liquidation or sale of substantially all of the Company’s assets.

The Company’s changecurrent CIC Agreements provide the following payments and benefits to our NEOs subject to execution of a general release of claims in control agreements with its officers do not providefavor of the Company (except for or otherwise permit excise taxgross-up payments.

For the NEOs, theMr. Starck whose severance benefit includes the following:arrangement is discussed below):

 

(i)a

A lump sum payment equal to 2.99 times(a) 2.0 multiplied by (b) the sum of the executive officer’s annual base salary plus the executive’s target annual bonus (in each case, as ofdetermined in accordance with the date of termination or change in control (whichever is greater) plus average bonus for the three years preceding the date of termination or change in control (whichever is greater)CIC Agreement);

66Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

 

(ii)a

A lump sum amount representing a pro ratapro-rata portion of any annual incentive compensationbonus earned by the executive officer through the date of termination, based on the accrued amount or, if not determinable, assuming achievement of performance goals at the target level; and

 

(iii)an

A lump sum amount equal to additionalthe employer portion of COBRA premiums for continued medical benefits under COBRAbased on the active employee rates for two years and additional premiums for individual life insurance policies for two years (for executive officers receiving Company-provided life insurance); and.

(iv)all shares of restricted stock granted to the executive officer vest, all stock options vest and become immediately exercisable and all performance shares are awarded at the target level and become vested.

The foregoing severance benefit is reduced by the amount of any benefits payable under any other severance plan or arrangement of the Company.

In consideration for any benefits paid, the change in control agreementsCIC Agreements impose certainnon-competition andnon-solicitation restrictive covenants on the executive officers for a period of 12 months following employmentthe date of termination and prohibit the disclosure and use of confidential Company information. Each agreementCIC Agreement continues in effect through December 31, 2018.

CEO PAY RATIO

The table below sets forth comparative information regarding (A)2024 and renews on a year-to-year basis on January 1 unless terminated by the total compensationCompany with a notice of non-renewal delivered by September 30 of the Chairman, President & Chief Executive Officer aspreceding year.

Mr. Starck’s Severance Arrangements

In connection with the acquisition of December 31, 2017, (B)Apria, Inc., the total compensationCompany agreed to assume Mr. Starck’s existing severance arrangements with Apria, Inc., subject to certain modifications that were made in connection with the acquisition. In the event of a termination of Mr. Starck’s employment by the “median employee”Company without “cause” or a resignation by Mr. Starck for “good reason”, in each case, prior to March 29, 2024 (whether or not there is a subsequent change in control), subject to his execution of a release of claims in favor of the Company identified using total cash compensationand continued compliance with any applicable restrictive covenants, Mr. Starck would be entitled to the following:

(i)

An amount equal to the sum of 2.5 times (a) base salary plus (b) target annual bonus, payable in substantially equal payments in accordance with the Company’s payroll practices for the 30-month period following the termination date;

(ii)

A pro-rata bonus based on the greater of his target and actual annual bonus for the year of termination, payable in lump sum within 30 days of the termination date;

(iii)

An amount determined by the Company to equal the cost of providing continuation coverage under COBRA for up to two years following the termination date, payable in substantially equal payments in accordance with the Company’s payroll practices; and

(iv)

Any outstanding equity awards will immediately vest in full.

In the event of alla termination without “cause” or a resignation for “good reason” after March 29, 2024, subject to his execution of a release of claims and continued compliance with certain restrictive covenants, Mr. Starck will be entitled to receive severance pay in an aggregate amount equal to two times the sum of (i) his annual base salary, (ii) the average of his annual bonuses for the prior two years (or 100% if employed for less than two full annual bonus cycles), and (iii) an amount determined by the Company to equal his annual cost under COBRA, including the cost of his participation in the senior executive medical and dental programs. The severance payment is payable in periodic installments in accordance with the Company’s payroll practices over a period of 24 months.

For purposes of Mr. Starck’s severance arrangements, a “cause” event generally refers to the executive (i) engaging in or committing willful misconduct, (ii) engaging in or committing theft, fraud or other employeesconduct constituting a felony, (iii) refusing or demonstrating an unwillingness to substantially perform his duties, (iv) refusing or demonstrating an unwillingness to reasonably cooperate in good faith with any Company government investigation or provide testimony therein, (v) engaging in or committing any willful act that is likely to and which does in fact have the effect of injuring the reputation or business of the Company, (vi) willfully violating his fiduciary duty or his duty of loyalty to the Company or the Company’s Code of Ethical Business Conduct in any material respect, (vii) using alcohol or drugs in a manner which materially and repeatedly interferes with the performance of his duties or which has the effect of materially injuring the reputation or business of the Company, or (viii) engaging in or committing any other material breach of his employment agreement. “Good reason” generally refers to any of the following, without the executive’s written consent and subject to certain notice and cure provisions: (a) any reduction in the executive’s combined annual base salary and target level bonus percentage, except for a general one-time“across-the-board” salary reduction not includingexceeding 10% across all executive officers of the Chairman, PresidentCompany, (b) a relocation increasing the executive’s one-way commute by more than 30 miles, or (c) the Company does not permit the executive to continue to serve in a mutually acceptable senior executive position.

Owens & Chief Executive Officer,Minor, Inc.2024 Proxy Statement67


 Executive Compensation 

Long-Term Incentive Awards under the 2018 Stock Incentive Plan

Awards granted to our NEOs in 2023 were made under the Company’s 2018 Stock Incentive Plan, prior to our shareholders’ approval of the 2023 Omnibus Incentive Plan, which replaces the 2018 Stock Incentive Plan. In general, the award agreements under the Company’s 2018 Stock Incentive Plan provide that, upon an involuntary termination without “cause” or a termination due to disability, a pro-rata portion of the NEOs’ time-based awards and earned performance-based awards (as applicable) vests as of the termination date (with vesting of time-based awards based on the number of months worked during the applicable vesting period).

Upon a termination due to death, the unvested portion of the NEOs’ time-based awards vests in full as of the termination date and NEOs are entitled to receive any performance-based awards that are earned based on achievement of performance conditions.

In addition, the Company’s outstanding time-based equity awards generally include the same “double-trigger” feature discussed above under the CIC Agreements for accelerated vesting upon a termination without “cause” in the event of a change in control. Performance-based awards are deemed earned based on the target performance levels if there is a change in control prior to the applicable measurement date. If outstanding equity awards under the 2018 Stock Incentive Plan are not assumed or substituted in connection with a change in control, unvested awards will vest in full upon the change in control. For purposes of the 2018 Stock Incentive Plan, the definition of “change in control” is generally consistent with the definition set forth in the CIC Agreements, except that shares issued by the Company directly to the acquirer shall not be considered when determining whether the 30% beneficial ownership threshold of the first prong has been met.

The same treatment generally applies to the equity awards of all teammates of the Company upon the termination scenarios noted above, including in the event of a change in control.

Table of Potential Payments Upon Termination or Change in Control

The following table reflects the estimated potential compensation payable to each of the NEOs under the Company’s compensation and benefit plans and arrangements in the event of certain terminations of employment, including following a change in control. Except as otherwise stated in footnote (4) to the table below, the amounts shown are estimates of the amounts that would be paid to the NEOs upon termination of their employment assuming that such termination was effective December 31, 2017, and (C) the estimated ratio2023.

      

Name and Principal Position (1)

 

 Cash Severance 

Payment
($)

 Continuation
of Medical /
Welfare and
 Other Benefits 
(present value)
($)
  Acceleration and 
Continuation
of Equity
Awards
(5)
($)
  Parachute Excise 
Tax Impact
($)
  Total Termination 
Benefits
($)
     

Edward A. Pesicka

President & Chief Executive Officer

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

     

  Involuntary Termination Without Cause(2)

  $3,675,000  $32,639  $4,162,667     $7,870,306
     

  Voluntary Termination or Involuntary Termination With Cause

               
     

  Involuntary or Good Reason Termination after Change In Control

   4,900,000   33,252   11,627,499      16,560,751
     

  Disability(3)

   3,370,000      4,162,667      7,532,667
     

  Death(4)

         7,068,949      7,068,949
     

Alexander J. Bruni

Executive Vice President & Chief Financial Officer

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

     

  Involuntary Termination Without Cause(2)

  $1,090,796  $13,773  $273,345     $1,377,914
     

  Voluntary Termination or Involuntary Termination With Cause

               
     

  Involuntary or Good Reason Termination after Change In Control

   1,454,394   36,189   1,422,916      2,913,500
     

  Disability(3)

   6,600,000      273,345      6,873,345
     

  Death(4)

         798,876      798,876

68Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 

      

Name and Principal Position (1)

 

 Cash Severance 

Payment
($)

 Continuation
of Medical /
Welfare and
 Other Benefits 
(present value)
($)
  Acceleration and 
Continuation
of Equity
Awards
(5)
($)
  Parachute Excise 
Tax Impact
($)
  Total Termination 
Benefits
($)
     

Andrew G. Long

Executive Vice President, Chief Executive Officer,

Products & Healthcare Services

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

     

  Involuntary Termination Without Cause(2)

  $1,852,500  $14,470  $2,121,800     $3,988,770
     

  Voluntary Termination or Involuntary Termination With Cause

               
     

  Involuntary or Good Reason Termination after Change In Control

   2,470,000   47,342   6,228,160      8,745,502
     

  Disability(3)

   2,480,000      4,162,667      6,642,667
     

  Death(4)

         4,274,741      4,274,741
     

Perry Bernocchi

Executive Vice President, Chief Executive Officer,

Patient Direct

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

     

  Involuntary Termination Without Cause(2)

  $1,502,898  $13,233  $1,382,372     $2,898,503
     

  Voluntary Termination or Involuntary Termination With Cause

               
     

  Involuntary or Good Reason Termination after Change In Control

   2,003,865   27,538   4,017,602      6,049,005
     

  Disability(3)

   228,000      1,382,372      1,610,372
     

  Death(4)

         2,544,257      2,544,257
     

Daniel J. Starck

Executive Vice President, Business Excellence

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

     

  Involuntary Termination Without Cause(2)

  $2,145,000  $14,946  $413,245     $2,573,191
     

  Voluntary Termination or Involuntary Termination With Cause

               
     

  Involuntary or Good Reason Termination after Change In Control

   3,185,000   54,399   3,948,365      7,187,764
     

  Disability(3)

   3,073,000      413,245      3,486,245
     

  Death(4)

         1,288,758      1,288,758

(1)

The amounts shown in the table do not include accrued salary and vacation payable through the date of the NEO’s termination of employment or the distribution of any balances under the EDCP, Apria DCP or the Company’s 401(k) Plan.

(2)

Under the terms of each NEO’s applicable agreement, if the executive would be better off on an after-tax basis, any “parachute payments” under Section 280G of the Internal Revenue Code will be reduced to a level equal to the applicable Section 280G safe harbor.

(3)

A termination of employment due to disability entitles the NEOs to benefits under the Company’s disability plan, which is generally available to salaried teammates.

(4)

A termination of employment due to death entitles the NEOs to benefits under the Company’s life insurance plan, which is generally available to salaried teammates.

(5)

The amounts in this column represent the estimated benefit to the NEO due to accelerated vesting of equity awards as described in more detail on page 66 of this Proxy Statement and are calculated based on the number of shares subject to accelerated vesting multiplied by $19.27, the closing price of the Company’s Common Stock on December 29, 2023. Any performance shares or PSUs that vest are valued based upon assumed performance at the target level.

Owens & Minor, Inc.2024 Proxy Statement69


 Executive Compensation 

Pay Ratio Disclosure

As required by Section 953(b) of the Chairman, President & Chief Executive Officer’s total compensation toDodd-Frank Wall Street Reform and Consumer Protection Act, and item 402(u) of Regulation S-K, we are providing the total compensationfollowing information about the relationship of the “median employee.” As of December 31, 2017, the Company had approximately 8,600 employees, approximately 6,200 in the U.S. and 2,400 outside of the U.S.

Chief Executive Officer Total Compensation (A)

  $6,682,035 

“Median employee” Total Compensation (B)

  $39,481 

Ratio of (A) to (B)

   169:1 

To identify the “median employee” for the above ratio calculation, pay elements that were included in the total cash compensation calculation for each employee are:

Annualized Base Salary as of December 31, 2017

2017 target annual incentive

Company-paid 401(k) Plan match for last fiscal year (2016) paid in 2017

Company-paid pension plan payments in 2017

Company-paid life insurance premiums as of December 31, 2017

Annualized automobile allowance as of December 31, 2017

Conversion rate to U.S. dollars based on December 31, 2017 exchange rates for compensation paid in foreign currency

Once the “median employee” was identified based on total cash compensation, the annual total compensation was calculated for such “median employee” usingof our teammates and the same methodology used for the NEO set forth in the 2017 “Summary Compensation Table” in this proxy statement. This means that equityannual total compensation of Mr. Pesicka, our President and any other longer-term incentives awarded, if any, are counted for the “median employee” and Chairman, President & Chief Executive Officer. The estimated pay ratio wasincluded in this information is a reasonable estimate calculated in a manner consistent with the requirements of Item 402(u) of RegulationS-K.

As disclosed in the Summary Compensation Table, the 2023 annual total compensation as determined under Item 402 of Regulation S-K for Mr. Pesicka was $8,389,910. The 2023 annual total compensation as determined under item 402 of Regulation S-K for the median teammate was $40,143. Based on the foregoing, our estimate of the Exchange Act (“Item 402(u)”), and we believe it constitutes a reasonable estimate. However, as contemplated by Item 402(u), we relied on methods and assumptionsratio of Mr. Pesicka’s annual total compensation to the median teammate’s annual total compensation for 2023 is 209 to 1. Given the different methodologies that we determined to be appropriate for calculating the pay ratio at the Company. Othervarious public companies maywill use methods and assumptions that differ fromto determine an estimate of their pay ratios, the ones we chose but are appropriate for their circumstances. In light of these different methods and assumptions, the estimated pay ratio reported above should not be used as a basis for comparison between companies.

On December 31, 2023, we and our subsidiaries employed a total of over 22,200 teammates. For 2023, we identified the median teammate based on total target compensation of each teammate within our global workforce as set forth in our human resources databases on December 31, 2023, which included target salary, cash bonus, equity compensation, and other compensation. We believe this method reflects a reasonable estimate for actual compensation paid. For the approximately 8,500 teammates outside the U.S., we converted their compensation to U.S. dollars using prevailing exchange rates as of December 31, 2023. We calculated the total annual compensation for the “median teammate” for 2023 in the same way Mr. Pesicka’s total annual compensation was calculated in the Summary Compensation Table. The integration of the Apria, Inc. population in 2023 which consisted of approximately 6,400 teammates, greatly reduced the CEO pay ratio.

70Owens & Minor, Inc.2024 Proxy Statement


 Executive Compensation 
Pay versus Performance
The following table sets forth certain information with respect to the Company’s financial performance and the compensation paid to our NEOs for the fiscal years (“FY”) ended on December 31, 2023, December 31, 2022, December 31, 2021 and December 31, 2020, as required by SEC rules.
        
Year
Summary
Compensation
Table Total for
PEO
(1)
($)
Compensation
Actually Paid to
PEO
(1)(2)(7)
($)
Average
Summary
Compensation
Table Total for
non-PEO

NEOs
(3)
($)
Average
Compensation
Actually Paid
to
non-PEO

NEOs
(2)(3)(7)
($)
Value of initial fixed $100
Investment based on:
Net
Income
($mm)
(5)
Adjusted
EPS
(6)
($)
Total
Shareholder
Return
(4)
($)
Peer Group
Total
Shareholder
Return
(4)
($)
        
2023$8,389,910$2,434,260 $3,274,168$2,596,315$373$123($41)$1.36
        
2022 6,245,259 (20,486,138) 2,782,307 (1,231,650) 378 117 22 2.42
        
2021 7,680,578 42,840,278  3,378,068 7,915,780  843 151 222 4.10
        
2020 7,628,179 56,613,156 2,277,468 8,482,353 524 125 30 2.26
(1)The name of the Principal Executive Officer of the Company (“PEO”) reflected in these columns for each of the applicable fiscal years is Edward A. Pesicka.
(2)In calculating the ‘compensation actually paid’ (“CAP”) amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant (except for changes due to the relevant measurement date).
(3)
The names of each of the
non-PEO
NEOs reflected in these columns for each applicable fiscal year are as follows: (i) for fiscal year 2023, Andrew G. Long, Alexander J. Bruni, Perry A. Bernocchi, and Daniel J. Starck; (ii) for fiscal year 2022, Mr. Long, Mr. Bruni, Nicholas J. Pace, Mr. Starck, Tammy L. Gomez and Jeffrey T. Jochims; (iii) for fiscal year 2021, Mr. Long, Mr. Jochims, Christopher M. Lowery, Mr. Pace and Mark P. Zacur; and (iv) for fiscal year 2020, Mr. Long, Mr. Jochims and Mr. Lowery.
(4)
The Company TSR and the Company’s Peer Group TSR reflected in these columns for each applicable fiscal year is calculated based on a fixed investment of $100 at the applicable measurement point on the same cumulative basis as is used in Item 201(e) of Regulation
S-K.
The peer group used to determine the Company’s Peer Group TSR for each applicable fiscal year is the following published industry index, as disclosed in our 2024 Annual Report on Form
10-K
pursuant to Item 201(e) of Regulation
S-K:
Russell 3000 Medical Equipment and Services Sector Index.
(5)
Represents the amount of net income reflected in the Company’s audited financial statements for each
applicable
fiscal year.
(6)
We have selected Adjusted EPS as our most important financial measure (that is not otherwise required to be disclosed in the table) used to link CAP to our NEOs to company performance for fiscal year 2023. Adjusted EPS is a
non-GAAP
financial measure, which excludes items and charges that (i) management does not believe reflect the Company’s core business and relate more to strategic, multi-year corporate activities; or (ii) relate to activities or actions that may have occurred without predictable trends from net income reported in accordance with U.S. GAAP. Charges excluded from Adjusted EPS and other
non-GAAP
financial measures include intangible amortization, acquisition-related and exit and realignment charges, and other adjustments. Adjusted EPS and other
non-GAAP
financial measures included in this Proxy Statement and a reconciliation to the most comparable GAAP equivalent financial measure for the years ended December 31, 2023, 2022, 2021, and 2020 are described in the Company’s Current Reports on Form
8-K
filed with the SEC on February 20, 2024, February 28, 2023 and February 23, 2022.
(7)
For fiscal years 2023, 2022, 2021 and 2020 the CAP to the PEO and the average CAP to the
non-PEO
NEOs reflect the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for fiscal years 2023, 2022, 2021 and 2020, as applicable, computed in accordance with Item 402(v) of Regulation
S-K.
Adjustments for (a) increase in fair value of awards granted and vesting during the applicable FY, and (b) reduction of fair value of awards granted during prior FY that were forfeited during the applicable FY, were not included as columns because there were no values to report during the covered year:
Owens & Minor, Inc.
2024 Proxy Statement
71

 Executive Compensation 
       
Year
Deduction for
amounts
reported in the
“Stock Awards”
and “Option
Awards”
columns in the
SCT for
applicable FY
Increase in fair
value of awards
granted during
applicable FY
that remain
unvested as of
applicable FY
end, determined
as of applicable
FY end
Change in fair
value of awards
granted during
prior FY that
were outstanding
and unvested as
of applicable FY
end, determined
based on change
in fair value from
prior FY end to
applicable FY end
Change in fair
value of awards
granted during
prior FY that
vested during
applicable FY,
determined
based on change
in fair value from
prior FY end to
vesting date
Increase based
on dividends or
other earnings
paid during
applicable FY
prior to vesting
date
Total
Adjustments
      
PEO
      
2023$(5,834,851) $4,084,966 $(49,069$(4,156,695)  $(5,955,649
      
2022 (4,915,897) 1,141,587 (21,056,470) (1,903,417) 2,800 (26,731,397)
      
2021 (4,400,000) 8,409,551 29,692,842 1,440,780 16,527 35,159,700
      
2020 (4,400,000) 24,624,886 28,689,464 64,068 6,559 48,984,977
      
Avg.
non-PEO
NEOs
      
2023$(2,086,665) $1,597,860 $(11,257 $(177,791  $(677,853
      
2022 (1,950,021) 378,830 (2,249,301) (193,567) 103 (4,013,956)
      
2021 (1,700,000) 2,841,429 2,961,055 433,444 1,784 4,537,712
      
2020 (733,333) 4,104,161 2,573,437 259,703 918 6,204,886
72
Owens & Minor, Inc.
2024 Proxy Statement

 Executive Compensation 
Pay versus Performance Comparative Disclosure
In accordance with Item 402(v) of Regulation
S-K,
the Company is providing the following graphs depicting the relationships between the information presented in the table above. The graphs below further depict the relationship between the compensation actually paid and the performance measures shown in the pay versus performance tabular disclosure above. In addition, the first graph below shows the relationship between Company total shareholder return and that of the Russell 3000 Medical Equipment and Services Sector Index. Compensation actually paid for purposes of the tabular disclosure and the following graphs were calculated in accordance with SEC rules and do not necessarily represent the actual amount of compensation earned by or actually paid to our NEOs during the applicable years.
LOGO
The peer group used to determine the Company’s Peer Group TSR for each applicable fiscal year is the following published industry index, as disclosed in our 2023 Annual Report on Form
10-K
pursuant to Item 201(e) of Regulation
S-K:
Russell 3000 Medical Equipment and Services Sector Index.
LOGO
Owens & Minor, Inc.
2024 Proxy Statement
73

 Executive Compensation 
LOGO
Pay versus Performance Tabular List
The following table lists our most important performance measures used by us to link CAP to our NEOs to company performance for fiscal year 2023. The performance measures included in this table are not ranked by relative importance.
Most Important
Performance
Measures
Adjusted EPS
Revenue
Adjusted Operating
Income
74
Owens & Minor, Inc.
2024 Proxy Statement


Proposal 4: Advisory Shareholder Vote to Approve Executive Compensation

PROPOSAL 4: ADVISORY SHAREHOLDER VOTE TO APPROVE EXECUTIVE COMPENSATION

In accordance with Section 14A of the Exchange Act, shareholders have the opportunity to cast an advisory vote to approve the compensation of our NEOs as disclosed in this proxy statement.Proxy Statement. This proposal, commonly known as a“say-on-pay” proposal, gives shareholders the opportunity to approve, reject or abstain from voting with respect to our 20172023 executive compensation programs and policies and the compensation paid to our NEOs. Although the vote isnon-binding, we value our shareholders’ opinions and will consider the outcome of the vote in establishing compensation philosophy and making future compensation decisions. At the Company’s 2016 annual meeting,2022 Annual Meeting, the majority of our shareholders voted to advise us to include asay-on-pay proposal every year, and the Board of Directors determined that the Company willwould hold an advisory shareholder vote on executive compensation every year. Thisnon-binding advisory vote on the frequency ofsay-on-pay proposals must be held at least once every six years.

As more fully discussed in the “Compensation Discussion and Analysis” section of this proxy statement beginning on page 33, theThe Company’s goal for its executive compensation program is to attract, motivate and retain a talented team of executives who will provide leadership for our success in the intensely competitive global healthcare supply services industry. We seek to accomplish this goal in a manner that rewards performance, is aligned with long-term shareholder interests and is consistent with sound compensation governance principles. The CompensationOP&C Committee and the Board of Directors believe that the policies and procedures articulated in the CD&A (which begins on page 42 of this Proxy Statement) are effective in implementing our compensation philosophy and in achieving our long-term goals and that the compensation of our NEOs in 20172023 reflects and supports these compensation policies and procedures and reflects our foundational pay for performance principles.

Accordingly, the Board of Directors recommends that shareholders vote in favor of the following resolution:

“RESOLVED, that the shareholders approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in the Proxy Statement for the 20182024 Annual Meeting of Shareholders pursuant to the rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the accompanying compensation tables and the related narrative disclosure.”

The Board of Directors recommends a vote FOR the foregoing resolution approving, on an advisory basis, the compensation of our named executive officers as disclosed in this proxy statement.Proxy Statement.

CERTAIN RELATIONSHIPS AND TRANSACTIONSOwens & Minor, Inc.2024 Proxy Statement75


Certain Relationships and Transactions

In accordance with the Audit Committee charter, the Audit Committee shall review and discuss with management and the independent auditor any transactions or courses of dealing with parties related to the Company which transactions are significant in size or involve terms that differ from those that would likely be negotiated with independent parties and which are relevant to an understanding of the Company’s financial statements. The Audit Committee charter further provides that the Audit Committee shall review and approve all transactions between the Company and any related person that are required to be disclosed pursuant to Regulation S-K Item 404. The Company has not adopted written procedures for review of, or standards for approval of,entered any such related person transactions (as defined in Item 404 of RegulationS-K), but instead reviews these transactions on acase-by-case basis.party transactions.

SHAREHOLDER PROPOSALSShareholder Proposals

Under regulations of the SEC, anyShareholder Proposals under Rule 14a-8

Any shareholder desiring to make a proposal to be acted upon at the 20192025 Annual Meeting of Shareholders must present(i) follow the procedures, and comply with the requirements, set forth in Rule 14a-8 under Exchange Act and (ii) timely deliver such proposal to our Corporate Secretary at the Company’s principal office at 9120 Lockwood Boulevard, Mechanicsville, Virginia 23116 not later than November 26, 201827, 2024, in order for the proposal to be considered for inclusion in the Company’s Proxy Statement.

Director Nominations for Inclusion in our 2025 Proxy Materials (Proxy Access) 

Under certain circumstances, our Bylaws permit a shareholder, or a group of up to 20 shareholders, owning 3% or more of the outstanding shares of the Company’s stock eligible to vote in the election of directors continuously for at least three years, to nominate and include in the Company’s Annual Meeting proxy statement. Allmaterials director candidates. The maximum number of shareholder proposals andnominated director nominationscandidates that can be included in the Company’s Annual Meeting proxy materials pursuant to the proxy access provisions of our Bylaws cannot exceed the greater of two or 20% of the number of directors in office as of the last day on which a shareholder notice may be delivered pursuant to Section 1.09 of the Bylaws. For a shareholder request to be timely under the proxy access provisions of our Bylaws, such request must be submittedreceived by our Corporate Secretary at the Company’s principal office at 9120 Lockwood Boulevard, Mechanicsville, Virginia 23116 not later than the close of business on the 120th day nor earlier than the close of business on the 150th day prior to the anniversary date of the immediately preceding mailing date for the notice of annual meeting. Accordingly, requests to include shareholder-nominated candidates in accordanceour proxy materials for the 2025 Annual Meeting must be received by the Corporate Secretary no earlier than the close of business on October 28, 2024 and not later than November 27, 2024.

All proxy access shareholder requests must comply with the timing, disclosure, procedural and contain the information required byother requirements of our Bylaws, which are available as described under “Corporate Governance—Governance — Corporate Governance Materials” on page 38 of this Proxy Statement.

Other Shareholder Proposals

Our bylaws establish an advance notice procedure for shareholders wishing to directly nominate a director candidate (other than for inclusion in our proxy statement. The Company will determine whetherstatement) or to include properly submitted proposals inpresent business to be conducted at the proxy statement in accordance with the SEC’s regulations governing the solicitation of proxies.

2025 Annual Meeting. Our Bylaws provide that a shareholder of record of the Company entitled to vote for the election of directorsat such Annual Meeting may nominate persons for election as directors onlyor propose such other business at an annual meeting andthe Annual Meeting if, among other things, such shareholder delivers written notice of such shareholder’s intent to make such nomination or nominations has been givenor propose such business (which business for the avoidance of doubt must constitute a proper matter for shareholder action) to our Corporate Secretary at the Company’s principal office at 9120 Lockwood Boulevard, Mechanicsville, Virginia 23116 not earlier than the close of business on the 150th day prior to nor later than 120 daysthe close of business on the 120th day before the anniversary of the date of the Company’s immediately preceding annual meeting. TheAnnual Meeting. Accordingly, the Corporate Secretary must receive written notice of a shareholder nomination to be acted upon at the 20192025 Annual Meeting no earlier than the close of business on December 10, 2024, and not later than January 09, 2025. However, in the event that the date of the 2025 Annual Meeting is more than 30 days before or more than 70 days after the anniversary date of the 2024 Annual Meeting, then to be timely the shareholder’s notice must be delivered not earlier than the close of business on the 150th day prior to such Annual Meeting and not later than the close of business on January 8, 2019. The shareholder’s notice must include the information required by our Bylaws, including but not limited to:

the name and address of recordlater of the shareholder intending120th day prior to makesuch Annual Meeting or the nomination,10th day following the beneficial owner, if any,day on whose behalf the nomination is made and of the person or persons to be nominated;

a representation that such shareholder is a shareholder of record and intends to appear in person or by proxy at such meeting to nominate the director candidate;

the class and number of shares of Common Stock that are owned by such shareholder and such beneficial owners;

a description of all arrangements, understandings or relationships between such shareholder and each director nominee and any other person(s) (naming such person(s)) pursuant to which the nomination is to be made by such shareholder;

a description (including the names of any counterparties) of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, hedging transactions and borrowed or loaned shares) that has been entered into aspublic announcement of the date of such meeting is first made by the shareholder’s notice by, orCompany.

76Owens & Minor, Inc.2024 Proxy Statement


 Certain Relationships and Transactions 

All shareholder proposals and director nominations must comply with the timing, disclosure, procedural and other requirements our Bylaws, which are available as described under “Corporate Governance — Corporate Governance Materials” on behalfpage 8 of this Proxy Statement.

In addition to satisfying the forgoing requirements of the shareholderBylaws, including the notice deadlines set forth above and any other person on whose behalftherein, to comply with the nomination is made, the effect or intent of which is to mitigate loss, manage risk or benefit resulting from share price changes of, or increase or decrease the voting power of the shareholder or any other person on whose behalf the nomination is made with respect to, shares of stock of the Company;

a description (including the names of any counterparties) of any agreement, arrangement or understanding with respect to such nomination between or among the shareholder or any other person on whose behalf the nomination is made and any of its affiliates or associates, and any others acting in concert with any of the foregoing;

a representation that the shareholder will notify the Company in writing of any changes to certain information provided above (as further specified in the Bylaws);

such other information regarding each nominee proposed by such shareholder as would be required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required to be disclosed, pursuant to theSEC’s universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the SEC, hadCompany’s nominees must also comply with the nominee been nominated, or intended to be nominated, byadditional requirements of Rule 14a-19 under the Board of Directors; andExchange Act.

the written consent of the nominee to serve as a director if elected.

In order for a shareholder to bring other business before a shareholder meeting, timely notice must be received by the Company within the time limits described in the immediately preceding paragraph. The shareholder’s notice must contain the information required by our Bylaws, including but not limited to:

 

the information described above with respect to the shareholder proposing such business;

The information described above with respect to the shareholder proposing such business;

 

a brief description of the business desired to be brought before the meeting, including the complete text of any resolutions to be presented at the annual meeting and the reasons for conducting such business at the annual meeting; and

A brief description of the business desired to be brought before the meeting, including the complete text of any resolutions to be presented at the Annual Meeting and the reasons for conducting such business at the Annual Meeting; and

 

any material interest of such shareholder and such beneficial owner in such business.

Any material interest of such shareholder and such beneficial owner in such business.

The requirements found in our Bylaws are separate from the requirements a shareholder must meet to have a proposal included in the Company’s proxy statementProxy Statement under the proxy rules.

Our Bylaws further permit a shareholder, or a group of up to 20 shareholders, owning 3% or more of the outstanding shares of the Company’s stock eligible to vote in the election of directors continuously for at least three years, to nominate and include in the Company’s Annual Meeting proxy materials director candidates to comprise generally up to two or 20% of the Board seats (whichever is greater), provided that such shareholder or group of shareholders satisfies the requirements set forth in Article I, Section 1.09 of the Bylaws.

In addition to satisfying the foregoing requirements under the Company’s Bylaws, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice to the Company that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 10, 2025.

Further Information About Attending the Virtual Annual Meeting

You are entitled to participate in the Annual Meeting only if you were a shareholder as of the close of business on the Record Date, or if you hold a valid proxy for the Annual Meeting. No physical meeting will be held. You will be able to virtually attend the Annual Meeting online and submit your questions during the meeting by visiting www.meetnow.global/MQUPCLA. You also will be able to vote your shares online by attending the Annual Meeting by webcast.

To participate in the Annual Meeting, you will need to log on using the control number from your proxy card or meeting notice. The control number can be found in the shaded box.

If you are a registered shareholder, you do not need to register to attend the Annual Meeting virtually on the Internet. If you hold your shares through an intermediary, such as a bank or broker, you must register in advance in order to attend the meeting. To register to attend the Annual Meeting online by webcast you must submit proof of your proxy power (legal proxy) reflecting your Owens & Minor holdings along with your name and email address to Computershare. You must contact the bank or broker who holds your shares to obtain your legal proxy. Requests for registration must be labeled as “Legal Proxy” and be received no later than 5:00 p.m., Eastern Time, three business days prior to the meeting date. You will receive a confirmation of your registration by email after we receive your legal proxy. Requests for registration should be directed to us by emailing an image of your legal proxy, to legalproxy@computershare.com or by mail to Computershare, Owens & Minor, Inc. Legal Proxy, P.O. Box 43001, Providence, RI 02940-3001.

If you do not have your control number, you may attend as a guest (non-shareholder) but will not have the option to vote your shares or ask questions at the virtual meeting.

The online meeting will begin promptly at 9:00 a.m., EDT. We encourage you to access the meeting prior to the start time leaving ample time for the check in.

Owens & Minor, Inc.2024 Proxy Statement77


OTHER MATTERSOther Matters

The Board of Directors is not aware of any matters to be presented for action at the annual meetingAnnual Meeting other than as set forth in this proxy statement.Proxy Statement. However, if any other matters properly come before the annual meeting,Annual Meeting, or any adjournment or postponement thereof, the person or persons voting the proxies will vote them in accordance with their best judgment.

March 26, 201827, 2024

BY ORDER OF THE BOARD OFBY ORDEROFTHE BOARDOF DIRECTORS

LOGO

NICHOLAS J. PACE

Executive Vice President, General Counsel, Corporate Secretary & Communications

Appendix A

OWENS & MINOR, INC.

2018 STOCK INCENTIVE PLAN

 

 

LOGO

HEATH H. GALLOWAY

Executive Vice President, General Counsel &

Corporate Secretary

 

78Owens & Minor, Inc.2024 Proxy Statement


ANNEX A




TO THE OWENS & MINOR, INC.

2018 STOCK2023 OMNIBUS INCENTIVE PLAN

ARTICLE I

DEFINITIONS

1.01.ADMINISTRATOR

Administrator meansTHIS AMENDMENT NO. 1 to the Governance Committee with respect to awards to Nonemployee Directors and in all other instances means the Compensation Committee or a delegate of the Compensation Committee thatOwens & Minor, Inc. 2023 Omnibus Incentive Plan (the “Plan”) is appointed in accordance with Article III.

1.02.AGREEMENT

Agreement means a written or electronic agreement (including any amendment or supplement thereto) between the Company and a Participant specifying the terms and conditions of a Stock Unit Award, a Stock Award, Incentive Award, Option or SAR granted to such Participant.

1.03.BOARD

Board meansapproved by the Board of Directors of the Company.

1.04.CHANGEIN CONTROL

Change in Control means:

(a) Any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, or any Company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes the “beneficial owner” (as defined in Rule13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company’s then outstanding securities provided, however, that Company securities acquired directly from the Company shall be disregarded for this purpose;

(b) During any period of twelve (12) consecutive months, individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clause (a), (c) or (d) of this Section and other than a director initially elected or nominated as a result of an actual or threatened election contest with respect to directors) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of a majority of the directors then still in office who either (x) were directors at the beginning of such period or (y) were so elected or nominated with such approval, cease for any reason to constitute at least a majority of the Board;

(c) There is consummated a stockholder-approved merger or consolidation of the Company with any other Company, other than (x) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (y) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no “person” (as hereinabove defined) acquires more than thirty percent (30%) of the combined voting power of the Company’s then outstanding securities; or

(d) There is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

(e) The stockholders of the Company approve a plan of complete liquidation of the Company.

In addition, if a Change in Control (as defined in clauses (a), (b), (c) or (d) above) constitutes a payment event with respect to any Option, SAR, Stock Award, Stock Unit award or Incentive Award that provides for the deferral of compensation and is subject to Section 409A of the Code, no payment will be made under that award on account of a Change in Control unless the event described in clause (a), (b), (c) or (d) above, as applicable, constitutes a “change in control event” as defined in Treasury RegulationSection 1.409A-3(i)(5).

1.05.CODE

Code means the Internal Revenue Code of 1986, and any amendments thereto.

1.06.COMMITTEE

Committee means the Governance Committee in respect of awards to Nonemployee Directors and the Compensation Committee in respect of awards to other individuals who are eligible to participate in the Plan.

1.07.COMMON STOCK

Common Stock means the common stock of the Company.

1.08.COMPANY

Company means Owens & Minor, Inc.

1.09.COMPENSATION COMMITTEE

Compensation Committee means the Compensation and Benefits Committee, a Virginia corporation (the “Company”) as of the Board.

1.10.CONTROL CHANGE DATE

Control Change Date means the date on which a Change in Control occurs. If a Change in Control occurs on account of a series of transactions, the Control Change Date is the date of the last of such transactions.

1.11.CORRESPONDING SAR

Corresponding SAR means an SAR that is granted in relation to a particular Option and that can be exercised only upon the surrender to the Company, unexercised, of that portion of the Option to which the SAR relates.

1.12.EXCHANGE ACT

Exchange Act means the Securities Exchange Act of 1934, as amended.

1.13.EXPIRATION DATE

Expiration Date means the last day of the stated term of an Option or SAR,i.e., the last day that the Option or SAR could be exercised if the Participant remained in continuous employment or service from the date of grant of the Option or SAR.

1.14.FAIR MARKET VALUE

Fair Market Value means, on any given date, the closing price of a share of Common Stock as reported on the New York Stock Exchange composite tape on such date, or if the Common Stock was not traded on the New York Stock Exchange on such day, then on the next preceding day that the Common Stock was traded on such exchange, all as reported by such source as the Administrator may select.

1.15.GOVERNANCE COMMITTEE

Governance Committee means the Governance and Nominating Committee of the Board.

1.16.INCENTIVE AWARD

Incentive Award means an award that entitles the Participant to receive a payment from the Company or a Related Entity that may be in cash, Common Stock or a combination of cash and Common Stock.

1.17.INITIAL VALUE

Initial Value means, with respect to a Corresponding SAR, the Option price per share of the related Option and, with respect to an SAR granted independently of an Option, the amount determined by the Administrator on the date of grant (but not less than the Fair Market Value of one share of Common Stock on the date of grant). Except as provided in Article X, without the approval of shareholders (a) the Initial Value of an outstanding SAR may not be reduced (by amendment, cancellation and new grant or otherwise) without the approval of shareholders and (b) no payment may be made to cancel an outstanding SAR if on the date of such amendment, cancellation, new grant or payment the Initial Value exceeds the Fair Market Value.

1.18.NONEMPLOYEE DIRECTOR

Nonemployee Director means a member of the Board who is not an employee of the Company or a Related Entity.

1.19.OPTION

Option means a stock option that entitles the holder to purchase from the Company a stated number of shares of Common Stock at the price set forth in an Agreement.

1.20.PARTICIPANT

Participant means an employee of the Company or a Related Entity, a member of the Board, or an individual who provides services to the Company or a Related Entity who satisfies the requirements of Article IV and is selected by the Administrator to receive a Stock Unit Award, a Stock Award, an Option, an SAR, or an Incentive Award or a combination thereof.

1.21.PERFORMANCE GOAL

Performance Goal means a performance objective that is stated with respect to one or more business criteria that the Administrator may select, alone or in combination, including without limitation any of the following: (i) gross, operating or net earnings before or after taxes; (ii) return on equity; (iii) return on capital; (iv) return on sales; (v) return on assets or net assets; (vi) earnings per share; (vii) cash flow per share; (viii) book value per share; (ix) earnings growth; (x) sales or sales growth; (xi) volume growth; (xii) cash flow (as defined by the Committee); (xiii) Fair Market Value; (xiv) total shareholder return; (xv) market share; (xvi) productivity; (xvii) level of expenses; (xviii) quality; (xix) safety; (xx) customer satisfaction; (xxi) total economic value added; (xxii) earnings before interest, taxes, depreciation and amortization and (xxiii) revenues or revenue growth.

A Performance Goal may be expressed with respect to the Company, a Related Entity, a business unit of the Company or a Related Entity, any subset thereof or any other way the Administrator may determine. A Performance Goal also may be expressed on an absolute basis or relative to the performance of one or more similarly situated companies or a published index or otherwise. When establishing Performance Goals or determining if the Performance Goals were achieved, the Committee may exclude any or all special, unusual or extraordinary items as determined under U.S. generally accepted accounting principles, including, without limitation, the charges or cost associated with restructurings of the Company, discontinued operations, other unusual ornon-recurring items and the cumulative effects of accounting changes. The Committee may also adjust Performance Goals as it deems equitable, including without limitation in recognition of unusual ornon-recurring events affecting the Company, changes in applicable tax laws or accounting principles or such other factors as the Committee may determine.

1.22.PLAN

Plan means the Owens & Minor, Inc. 2018 Stock Incentive Plan.

1.23.PRE-EXISTING PLAN

Pre-Existing Plan means the Owens & Minor, Inc. 2015 Stock Incentive Plan.

1.24.RELATED ENTITY

Related Entity means any “subsidiary” or “parent” corporation (within the meaning of Section 424 of the Code) of the Company.

1.25.SAR

SAR means a stock appreciation right that in accordance with the terms of an Agreement entitles the holder to receive, with respect to each share of Common Stock encompassed by the exercise of such SAR, the excess of the Fair Market Value at the time of exercise over the Initial Value or a lesser amount as determined by the Administrator and specified in an Agreement. References to “SARs” include both Corresponding SARs and SARs granted independently of Options, unless the context requires otherwise.

1.26.STOCK AWARD

Stock Award means shares of Common Stock awarded to a Participant under Article VII, including Common Stock issued in settlement of a Stock Unit Award.

1.27.STOCK UNIT AWARD

Stock Unit Award means an award that entitles the Participant to receive a benefit based on a number of shares of Common Stock equal to the number of stock units covered by the Stock Unit Award.

1.28.TEN PERCENT SHAREHOLDER

Ten Percent Shareholder means any individual owning more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of a Related Entity. An individual shall be considered to own any voting stock owned (directly or indirectly) by or for his or her brothers, sisters, spouse, ancestors or lineal descendants and shall be considered to own proportionately any voting stock owned (directly or indirectly) by or for a corporation, partnership, estate or trust of which such individual is a shareholder, partner or beneficiary.

ARTICLE II

PURPOSES

The Plan is intended to (a) assist the Company and Related Entities in recruiting and retaining key employees and members of the Board, and other individuals who provide services to the Company or a Related Entity, (b) authorize the grant of incentive compensation opportunities for such persons and (c) encourage such persons to identify their interests with those of the Company and its shareholders by enabling such persons to participate in the future success of the Company and the Related Entities. The Plan is intended to permit the grant of Stock Unit Awards, Stock Awards, SARs, the grant of both Options qualifying under Section 422 of the Code (“incentive stock options”) and Options not so qualifying, and the grant of Incentive Awards. No Option that is intendedMarch 14, 2024 to be an incentive stock option shall be invalid for failure to qualify as an incentive stock option.

ARTICLE III

ADMINISTRATION

The Plan shall be administered by the Administrator. The Administrator shall have authority to grant Stock Unit Awards, Stock Awards, Incentive Awards, Options and SARs upon such terms (not inconsistent with the provisions of this Plan) as the Administrator may consider appropriate. Such terms may include conditions (in addition to those contained in this Plan) on the exercisability of all or any part of an Option or SAR or on the transferability or forfeitability of a Stock Award, Incentive Award, or Stock Unit Award, including by way of example and not limitation, conditions on which Participants may defer receipt of benefits under the Plan, requirements that the Participant complete a specified period of employment or service with the Company or a Related Entity or that the Company or Related Entity achieve a specified level of financial performance. Notwithstanding any such conditions or any provision of the Plan, (i) the Committee may accelerate the time at which an Option or SAR may be exercised, or the time at which a Stock Award may become transferable or nonforfeitable or the time at which an Incentive Award or Stock Unit Award may be settled (a) in connection with a termination of employment or service (including but not limited to death, disability, retirement or involuntary termination) or (b) if the award is outstanding for at least one year, and (ii) up to five percent (5%) of the available shares of Common Stock authorized for issuance under the Plan (subject to adjustmentseffective as set forth in Article X) may be issued underherein.

WHEREAS, the Plan pursuant to awards without regard to any restrictions upon any such acceleration (either pursuant to the original terms of the award or by acceleration). The Administrator shall have complete authority to interpret all provisions of this Plan; to prescribe the form of Agreements; to adopt, amend, and rescind rules and regulations pertaining to the administration ofCompany previously established the Plan; and to make all other determinations necessary or advisable for the administration of this Plan. The express grant in the Plan of any specific power to the Administrator shall not be construed as limiting any power or authority of the Administrator. Any decision made, or action taken, by the Administrator or in connection with the administration of this Plan shall be final and conclusive. Neither the Administrator nor any member of the Committee shall be liable for any act done in good faith with respect to this Plan or any Agreement, Option, SAR, Stock Award, Incentive Award or Stock Unit Award. All expenses of administering this Plan shall be borne by the Company.

The Compensation Committee, in its discretion, may delegate to one or more officers ofWHEREAS, the Company all or part of the Compensation Committee’s authority and duties with respectnow desires to grants and awards to individuals who are not subject to the reporting and other provisions of Section 16 of the Exchange Act. The Compensation Committee may revoke or amend the terms of a delegation at any time, but such action shall not invalidate any prior actions of the Compensation Committee’s delegate or delegates that were consistent with the terms of the Plan.

ARTICLE IV

ELIGIBILITY

4.01.GENERAL

Any employee of the Company or a Related Entity (including a corporation that becomes a Related Entity after the adoption of this Plan), any member of the Board (whether or not an employee), or a person who provides services to the Company or a Related Entity (including a corporation that becomes a Related Company after the adoption of this Plan)is eligible to participate in this Plan if the Administrator, in its sole discretion, determines that such person has contributed significantly or can be expected to contribute significantly to the profits or growth of the Company or a Related Entity.

4.02.GRANTS

The Administrator will designate individuals to whom Stock Awards, Incentive Awards, Stock Unit Awards, Options and SARs are to be granted and will specify the number of shares of Common Stock subject to each award or grant; provided, however, that only individuals who provide “direct services” to the Company or a Related Entity (as the term “direct services” is used for purposes of Section 409A of the Code) may be granted an Option or SAR. An SAR may be granted with or without a related Option. All Stock Awards, Stock Unit Awards, Options, SARs, and Incentive Awards granted under this Plan shall be evidenced by Agreements which shall be subject to the applicable provisions of this Plan and to such other provisions as the Administrator may adopt. No Participant may be granted incentive stock options or related SARs (under all incentive stock option plans of the Company and any Related Entity) which are first exercisable in any calendar year for stock having an aggregate Fair Market Value (determined as of the date an Option is granted) that exceed the limitation prescribed by Code section 422(d). The preceding annual limitation shall not apply with respect to Options that are not incentive stock options.

4.03.GENERAL TERMSOF AWARDS

Notwithstanding any other provision of the Plan to increase the contrary and subject to the immediately following provision, (i) no Option or SAR shall be exercisable, (ii) no Stock Award (other than a Stock Award granted in connection with a Stock Unit Award that becomes earned and convertible into a transferable and nonforfeitable Stock Award) will become transferable and nonforfeitable, (iii) no Stock Unit Award shall be earned and convertible into a transferable and nonforfeitable Stock Award, and (iv) no Incentive Award shall be earned, earlier than the first anniversary of the date the Option, SAR, Stock Award, Stock Unit Award or Incentive Award is granted, except with respect to Options, SARs, Stock Awards, Stock Unit Awards and Incentive Awards granted to Nonemployee Directors, which are permitted to vest earlier than suchone-year anniversary, upon the annual meeting of the shareholders of the Company that occurs in the year immediately following the year in which the award is granted; provided, however, that (i) the Administrator may grant awards without regard to the foregoing minimum vesting requirements with respect to a maximum of five percent (5%) of the available shares of Common Stock authorized for issuance under the Plan (subject to adjustments as set forth in Article X) and (ii) to the extent awards granted to Nonemployee Directors vest as of a date that is earlier than two weeks prior to the anniversary date of the immediately preceding year’s annual shareholders meeting, such awards will count against the five percent (5%) limitation. For the avoidance of doubt, the foregoing restriction does not apply to the Administrator’s discretion to provide in the terms of the award or otherwise for accelerated exercisability or vesting of any award upon the death or disability of the Participant or as set forth in Section 11.02 upon a Change in Control.

ARTICLE V

STOCK SUBJECT TO PLAN

5.01.SHARES ISSUED

Upon the award of shares of Common Stock pursuant to a Stock Award, including a Stock Award issued to settle Stock Unit Awards, the Company may issue shares of Common Stock from its authorized but unissued Common Stock. Upon the exercise of any Option or SAR the Company may deliver to the Participant (or the Participant’s broker if the Participant so directs), shares of Common Stock from its authorized but unissued Common Stock.

5.02.AGGREGATE LIMIT

The maximum aggregate number of shares of Common Stock that may be issued under this Plan shall be 3,600,000 shares, less the number of shares of Common Stock subject to awards granted under thePre-Existing Plan after March 1, 2018, plus the number of shares of Common Stock subject to awards granted under thePre-Existing Plan which become available in accordance with Section 5.04 below after March 1, 2018; provided, however, the total number of shares of Common Stock that may be issued upon the exercise of incentiveCompany common stock options shall not exceed 3,600,000 shares of Common Stock. The maximum aggregate number of shares of Common Stock that may be issued under this Plan and under incentive stock options shall be subject to adjustment as provided in Article X and Section 5.04. Except as otherwise set forth herein, shares of Common Stock covered by an Award shall only be counted as used to the extent actually used. If the stockholders of the Company approve the Plan, no further awards will be granted under thePre-Existing Plan after the stockholders approve the Plan; provided, however, that nothing in this Plan shall affect any awards granted under thePre-Existing Plan which are outstanding on the date the stockholders of the Company approve the Plan until such time, if any, that any shares of Common Stock subject to such awards granted under thePre-Existing Plan become available in accordance with the provisions of the Plan.

5.03.INDIVIDUAL LIMITATIONS

Subject to the limitation set forth in the preceding sections, no individual may, in any calendar year, be granted or awarded (i) Options or SARs, covering more than 2,000,000 shares of Common Stock; (ii) Stock Awards and Stock Unit Awards covering more than 1,000,000 shares of Common Stock; or (iii) Incentive Awards exceeding $10,000,000. Each of the limitations in the preceding sentence shall be multiplied by two with respect to awards granted to a Participant (other than a Nonemployee Director) during the calendar year in which the Participant first commences employment with the Company or a Related Entity. Notwithstanding the preceding sentences, a Nonemployee Director may not be granted awards during any single calendar year that, taken together with any cash fees paid to such Nonemployee Director during such calendar year in respect of the Nonemployee Director’s service as a member of the Board, exceeds $750,000 in total value (calculating the value of any such awards based on the grant date fair value of such awards for financial accounting purposes). Notwithstanding the foregoing, the Committee may make exceptions to the foregoing limit (up to twice such limit) for anon-executive chair of the Board or, in extraordinary circumstances, for other individual Nonemployee Directors, as the Committee may determine, provided that the Nonemployee Director receiving such awards may not participate in the decision to make such awards. The limitations set forth in this Section 5.03 shall be subject to adjustment as provided in Article X.

5.04.SHARE ADD-BACKS

If any Stock Unit Awards, Incentive Awards, Options, SARs or Stock Awards granted under the Plan, or any awards granted under thePre-Existing Plan that are outstanding after March 1, 2018, are cancelled, forfeited, expire or otherwise terminate without the issuance of shares of Common Stock, or if any such award is settled for cash or otherwise does not result in the issuance of all or a portion of the shares of Common Stock subject to

such award, the shares of Common Stock subject to the award shall, to the extent of such cancellation, forfeiture, expiration, termination, cash settlement ornon-issuance, again be available for issuance under the Plan.

In the event that (i) any Option granted under the Plan (or any Option granted under thePre-Existing Plan that is outstanding after March 1, 2018) is exercised through the tendering of shares of Common Stock (either actually or by attestation) or by the withholding of shares of Common Stock by the Company, or (ii) withholding tax liabilities resulting from any such Option or other award granted under the Plan (or any award granted under thePre-Existing Plan and outstanding after March 1, 2018) are satisfied by the withholding of shares of Common Stock (subject to the restrictions set forth in the Plan), then the number of shares tendered or withheld shall not be available for future grants of awards. Except as set forth in the following sentence, each share of Common Stock issued in connection with an award under the Plan shall reduce the total number of shares of Common Stock available for issuance under the Plan and revise certain provisions relating to share recycling (the “Proposed Amendments”).

NOW, THEREFORE, the Plan is hereby amended, as follows:

Section 4.1 of the Plan is hereby amended by one. If Commondeleting the present section in its entirety and substituting the following in lieu thereof:

4.1 Shares.

The aggregate number of Shares that may be issued pursuant to this Plan shall not exceed 6,175,000 Shares (subject to any increase or decrease pursuant to this Article IV), which may be either authorized and unissued Shares or Shares held in or acquired for the treasury of the Company or both. The aggregate number of Shares that may be issued or used with respect to any Incentive Stock is issuedOption shall not exceed 6,175,000 Shares (subject to any increase or decrease pursuant to this Section 4.1). Any Award under this Plan settled in settlementcash shall not be counted against the foregoing maximum share limitations. Notwithstanding anything to the contrary contained herein, Shares subject to an Award under this Plan or a Prior Plan Award shall not again be made available for issuance or delivery under this Plan if such Shares are (a) Shares delivered, withheld or surrendered in payment of the exercise or purchase price of an SAR granted underAward or a Prior Plan Award, (b) Shares delivered, withheld, or surrendered to satisfy any tax withholding obligation or (c) Shares covered by a stock-settled Stock Appreciation Right or other stock-settled Award that were not issued upon the Plan, the number of shares of Common Stock available under the Plan shall be reduced by the number of shares of Common Stock for which the SAR was exercised rather than the number of shares of Common Stock issued in settlement of the SAR. Furthermore, sharesAward; provided, however, that Shares subject to a Prior Plan Award that was granted pursuant to an exception under Section 303A.08 of Common Stock issued by the NYSE Listed Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards by a company acquired by the Company or Related Entity, or with which the Company or Related Entity combines, shall not reduce the maximum aggregate number of shares of Common StockManual that become available for issuance under the Plan (to the extent permitted by applicable stock exchange rules), and available shares of stock under a shareholder-approved plan of any such acquired company (as appropriately adjusted to reflect the transaction) also may be used for awards under the Plan, which shall not reduce the number of shares of Common Stock otherwise available under the Plan (subject to applicable stock exchange requirements). Shares of Common Stock that may be issued under the Plan may not be increased through the Company’s purchase of shares of Common Stock on the open market with the proceeds obtained from the exercise of Options granted under the Plan (or Options granted under thePre-Existing Plan and outstanding after March 1, 2018).

5.05.NONTRANSFERABILITY

Except as provided in Section 5.06, each Option, SAR, Stock Award, Stock Unit Award and Incentive Award, granted under this Plan shall be nontransferable except by will, by the laws of descent and distribution or, after the Participant’s death, in accordance with a beneficiary designation form provided by the Company and signed by the Participant and filed with the Company. In the event of any transfer of an Option, the Option and any Corresponding SAR that relates to such Option must be transferred to the same person or person(s). During the lifetime of the Participant to whom the Option or SAR is granted, the Option or SAR may be exercised only by the Participant. No right or interest of a Participant in any Option, SAR, Stock Award, Stock Unit Award or Incentive Award shall be liable for, or subject to, any lien, obligation, or liability of such Participant.

5.06.TRANSFERABLE OPTIONSAND SARS

Section 5.05 to the contrary notwithstanding, if the Agreement provides, an Option that is not an incentive stock option or an SAR, other than a Corresponding SAR that is related to an incentive stock option, may be transferred by a Participant to the Participant’s children, grandchildren, spouse, one or more trusts for the benefit of such family members or a partnership in which such family members are the only partners, on such terms and conditions as may be permitted under Securities Exchange Commission Rule16b-3 as in effect from time to time. The holder of an Option or SAR transferred pursuant to this section shall be bound by the same terms and conditions that governed the Option or SAR during the period that it was held by the Participant; provided, however, that such transferee may not transfer the Option or SAR except by will or the laws of descent and distribution. In the event of any transfer of an Option or SAR (by the Participant or his transferee), such Option and any Corresponding SAR must be transferred to the same person or persons or entity or entities.

5.07.DIVIDEND EQUIVALENTS

A Participant will have all rights of a shareholder with respect to a Stock Award, including the right to receive dividends; provided, however, that dividends payable on shares of Common Stock subject to a Stock Award shall either (i) be deemed reinvested in additional Stock Awards which shall remain subject to the same forfeitureterms and transfer conditions applicable to the Stock Award with respect to which such dividends related, or (ii) be paid in cash, without interest, if and at the time the related Stock Award is no longer subject to forfeiture and transfer conditions, as the Administrator shall set forth in the Agreement. Further, notwithstanding the other provisions of this Section 5.07, no dividend rights may be granted with respectsuch exception.

This Amendment No. 1 to Options or SARs. A Participant may be granted the right to receive a payment (in cash, Common Stock, or combination thereof) equal to the ordinary cash dividends that are payable with respect to the number of shares of Common Stock covered by a Stock Unit Award, subject to such terms, conditions, restrictions and/or limitations, if any, as the Administrator may establish; provided, however, such dividend equivalents shall either be (i) accumulated and reinvested into additional notional units that are payable in cash, shares of Common Stock or a combination of cash and Common Stock or (ii) accumulated and paid in cash, without interest, if and when the related Stock Unit Award is earned and convertible into a transferable and nonforfeitable Stock Award. No dividend equivalents shall be payable on a Stock Unit Award that does not become earned and convertible into a transferable and nonforfeitable Stock Award. No dividend rights or equivalents may be granted with respect to Options, SARs or Incentive Awards.

ARTICLE VI

OPTIONS AND SARS

6.01.AWARDS

In accordance with Article IV, and subject to the limitations set forth in Plan Section 5.03, the Administrator will designate each individual to whom an Option, SAR or both is to be made and will specify the number of shares of Common Stock covered by such awards.

6.02.OPTION PRICE

The price per share for Common Stock purchased on the exercise of an Option shall be determined by the Administrator on the date of grant; provided, however, that the price per share for Common Stock purchased on the exercise of any Option shall not be less than the Fair Market Value on the date the Option is granted. Notwithstanding the preceding sentence, the price per share for Common Stock purchased on the exercise of any Option that is an incentive stock option granted to an individual who is a Ten Percent Shareholder on the date such option is granted, shall not be less than one hundred ten percent (110%) of the Fair Market Value on the date the Option is granted. Except as provided in Article X, without the approval of shareholders (a) the Administrator may not reduce, adjust or amend the option price of an outstanding Option or SAR whether through amendment, cancellation, replacement grant or any other means and (b) no payment may be made to cancel an outstanding Option if on the date of such amendment, cancellation, replacement grant or payment the option price exceeds Fair Market Value. For avoidance of doubt, in no event may the price per share for Common Stock purchased on the exercise of any Option, or the Initial Value of any SAR, be less than the Fair Market Value of a share of Common Stock on the date the Option or SAR is granted.

6.03.MAXIMUM OPTIONOR SAR PERIOD

The maximum period in which an Option or SAR may be exercised shall be determined by the Administrator on the date of grant, except that no Option or SAR shall be exercisable after the expiration of ten years from the date such Option or SAR was granted. In the case of an incentive stock option or a Corresponding SAR related to an incentive stock option granted to a Participant who is a Ten Percent Shareholder on the date of grant, such Option or its Corresponding SAR shall not be exercisable after the expiration of five years from the date of grant. The terms of any Option or SAR may provide that it is exercisable for a period less than such maximum period.

6.04.EXERCISE

Subject to the provisions of this Plan, an Option or SAR may be exercised in whole at any time or in part from time to time at such times and in compliance with such requirements as the Administrator shall determine. A Corresponding SAR that is related to an incentive stock option may be exercised only to the extent that the related Option is exercisable and when the Fair Market Value exceeds the Option price of the related Option. An Option or SAR granted under this Plan may be exercised with respect to any number of whole shares less than the full number for which the Option or SAR could be exercised. A partial exercise of an Option or SAR shall not affect the right to exercise the Option or SAR from time to time in accordance with this Plan and the applicable Agreement with respect to the remaining shares subject to the Option or related to the SAR. The exercise of either an Option or Corresponding SAR shall result in the termination of the other to the extent of the number of shares with respect to which the Option or Corresponding SAR is exercised.

6.05.PAYMENT

Unless otherwise provided by the Agreement, payment of the Option price shall be made in cash or a cash equivalent acceptable to the Administrator. Subject to rules established by the Committee, payment of all or part of the Option price may be made with shares of Common Stock to the Company. If Common Stock is used to pay all or part of the Option price, the sum of the cash and cash equivalent and the Fair Market Value of the surrendered shares (on the exercise date) must not be less than the Option price of the shares for which the Option is being exercised.

6.06.DETERMINATIONOF PAYMENTOF CASHAND/OR COMMON STOCK UPON EXERCISEOF SAR

At the Administrator’s discretion, the amount payable as a result of the exercise of an SAR may be settled in cash, Common Stock, or a combination of cash and Common Stock. A fractional share shall not be deliverable upon the exercise of an SAR but a cash payment will be made in lieu thereof.

6.07.SHAREHOLDER RIGHTS

No Participant shall have any rights as a shareholder with respect to shares subject an Option until the date of exercise of such Option and the issuance of the shares of Common Stock. No Participant shall have any rights as a shareholder with respect to shares subject to an SAR until the date that the SAR is exercised and then only to the extent that the SAR is settled by the issuance of Common Stock. For avoidance of doubt, no dividend rights may be granted with respect to Options or SARs.

6.08.AUTOMATIC EXERCISE

This Section 6.08 applies to an Option or SAR if (i) the Participant to whom the Option or SAR was granted remains in the continuous employment or service of the Company or a Related Entity from the date the Option or SAR was granted until the Expiration Date of such Option or SAR, (ii) on the Expiration Date the Fair Market Value exceeds the exercise price of the Option or the Initial Value of the SAR and (iii) the Option or SAR has become exercisable on or before the Expiration Date. Each Option or SAR to which this Section 6.08 applies shall be exercised automatically on the Expiration Date to the extent that it is outstanding and unexercised on such date. An Option that is exercised pursuant to this Section 6.08 shall result in the issuance to the Participant of that number of whole shares of Common Stock that have a Fair Market Value that most nearly equals, but does not exceed, the excess of the Fair Market Value on the Expiration Date over the Option exercise price multiplied by the number of shares of Common Stock subject to the Option. An SAR that is exercise pursuant to this Section 6.08 shall be settled in accordance with section 6.06.

ARTICLE VII

STOCK AWARDS

7.01.AWARDS

In accordance with the provisions of Article IV, and subject to the limitations set forth in Plan Section 5.03, the Administrator will designate each individual to whom a Stock Award is to be made and will specify the number of shares of Common Stock covered by such awards. The per individual limitation of Section 5.03 on the issuance of Stock Awards shall not limit the issuance of Stock Awards in settlement of Stock Unit Awards and related dividend equivalents.

7.02.VESTING

Except in the case of Stock Awards issued in settlement of Stock Unit Awards, the Administrator, on the date of the award, shall prescribe that a Participant’s rights in the Stock Award shall be forfeitable or otherwise restricted for a period of time or subject to such conditions as may be set forth in the Agreement. By way of example and not of limitation, the restrictions may postpone transferability, vesting or both of the shares until the attainment of performance objectives prescribed by Committee, including objectives stated with respect to Performance Goals, or may provide that the shares will be forfeited if the Participant separates from the service of the Company and its Related Entities before the expiration of a stated term.

7.03.SHAREHOLDER RIGHTS

Prior to their forfeiture (in accordance with the terms of the Agreement and while the shares of Common Stock granted pursuant to the Stock Award may be forfeited), a Participant will have all rights of a shareholder with respect to a Stock Award, including the right to receive dividends and vote the shares; provided, however, that (i) dividends payable on shares of Common Stock subject to a Stock Award shall either be deemed reinvested in additional Stock Awards which shall remain subject to the same forfeiture and transfer conditions applicable to the Stock Award with respect to which such dividends related, or paid in cash, without interest, if and at the time the related Stock Award is no longer subject to forfeiture and transfer conditions, as the Administrator shall set forth in the Agreement, (ii) a Participant may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of shares of Common Stock granted pursuant to a Stock Award, (iii) the Company shall retain custody of any certificates evidencing shares of Common Stock granted pursuant to a Stock Award, and (iv) the Participant will deliver to the Company a stock power, endorsed in blank, with respect to each Stock Award. No dividends may be paid with respect to a Stock Award that is forfeited. The limitations set forth in the preceding sentence shall not apply after the shares of Common Stock granted under the Stock Award are no longer forfeitable.

ARTICLE VIII

STOCK UNIT AWARDS

8.01.AWARD

In accordance with the provisions of Article IV and subject to the limitations set forth in Section 5.03, the Administrator will designate individuals to whom a Stock Unit Award is to be granted and will specify the number of shares of Common Stock units covered by the award. The Administrator also will specify whether the Stock Unit Award includes the right to receive dividend equivalents.

8.02.EARNINGTHE AWARD

The Administrator, on the date of the grant of an award, shall prescribe that the Stock Unit Award, or portion thereof, will be earned, and the Participant will be entitled to receive Common Stock pursuant to a Stock

Award, a cash payment or a combination thereof, only upon the satisfaction of certain requirements. By way of example and not of limitation, the restrictions may postpone transferability, vesting or both of the Stock Unit Award until the attainment of performance objectives prescribed by the Committee, including objectives stated with respect to Performance Goals, or may provide that the Stock Unit Award will be forfeited if the Participant separates from the service of the Company and its Related Entities before the expiration of a stated term.

8.03.PAYMENT

In the discretion of the Administrator, the amount payable when a Stock Unit Award is earned may be settled in cash, by the grant of a Stock Award or a combination of cash and a Stock Award. A fractional share shall not be deliverable when a Stock Unit Award is earned, but a cash payment will be made in lieu thereof.

8.04.SHAREHOLDER RIGHTS

No Participant shall, as a result of receiving a Stock Unit Award, have any rights as a shareholder until and to the extent that the Stock Unit Award is earned and a Stock Award is made. A Participant may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of a Stock Unit Award or the right to receive Common Stock thereunder other than by will or the laws of descent and distribution. After a Stock Unit Award is earned and settled by the issuance of a Stock Award is made, a Participant will have all the rights of a shareholder as described in Plan section 7.04.

8.05.DIVIDEND EQUIVALENTS

The Administrator may, at the time of grant of any Stock Unit Award, include as a part of such award an entitlement to receive a payment (in cash, Common Stock, or combination thereof) equal to the ordinary cash dividends that are payable with respect to the number of shares of Common Stock covered by the award, subject to such terms, conditions, restrictions and/or limitations, if any, as the Administrator may establish; provided, however, such dividend equivalents shall either be (i) accumulated and reinvested into additional notional units that are payable in cash, shares of Common Stock or a combination of cash and Common Stock or (ii) accumulated and paid in cash, without interest, if and when the related Stock Unit Award is earned and convertible into a transferable and nonforfeitable Stock Award. No dividend equivalents shall be payable on a Stock Unit Award that does not become earned and convertible into a transferable and nonforfeitable Stock Award.

ARTICLE IX

INCENTIVE AWARDS

9.01.AWARDS

The Administrator shall designate Participants to whom Incentive Awards are made for incentive compensation opportunities. All Incentive Awards shall be finally determined exclusively by the Administrator under the procedures established by the Administrator, subject to the limitations set forth in Section 5.03.

9.02.TERMSAND CONDITIONS

The Administrator, at the time an Incentive Award is made, shall specify the terms and conditions which govern the award. Such terms and conditions may include, by way of example and not of limitation, requirements that the Participant complete a specified period of employment with the Company or a Related Entity or that the Company, a Related Entity, or the Participant attain stated objectives or goals, including objectives stated with respect to Performance Goals as a condition to earning an Incentive Award. The period for determining whether such requirements are satisfied shall be at least one year.

9.03.NONTRANSFERABILITY

Incentive Awards granted under this Plan shall be nontransferable except by will or by the laws of descent and distribution or in accordance with a beneficiary designation form provided by the Company and signed by the Participant and filed with the Company. No right or interest of a Participant in an Incentive Award shall be liable for, or subject to, any lien, obligation, or liability of such Participant.

9.04.EMPLOYEE STATUS

If the terms of an Incentive Award provide that a payment will be made thereunder only if the Participant completes a stated period of employment or continued service the Committee may decide to what extent leaves of absence for governmental or military service, illness, temporary disability or other reasons shall not be deemed interruptions of continuous employment or service.

9.05.SETTLEMENT

An Incentive Award that is earned shall be settled with a single lump sum payment which may be in cash, shares of Common stock or a combination of cash and Common Stock, as determined by the Committee.

9.06.SHAREHOLDER RIGHTS

No Participant shall, as a result of receiving an Incentive Award, have any rights as a shareholder of the Company until the date that the Incentive Award is settled and then only to the extent that the Incentive Award is settled by the issuance of Common Stock. For avoidance of doubt, no dividend rights may be granted with respect to Incentive Awards.

ARTICLE X

ADJUSTMENT UPON CHANGE IN COMMON STOCK

The maximum number of shares as to which Options (including incentive stock options), SARs, Stock Awards, Stock Unit Awards and Incentive Awards may be granted under this Plan, the individual grant limitations set forth in Section 5.03, and the terms of outstanding Stock Awards, Stock Unit Awards, Options, SARs, and Incentive Awards shall be adjusted as the Committee shall determine to be equitably required in the event that (a) the Company (i) effects one or more nonreciprocal transactions between the Company and its shareholders such as stock dividends, stocksplit-ups, subdivisions or consolidations of shares or extraordinary dividend (ii) engages in a transaction to which Section 424 of the Code applies or (b) there occurs any other event which, in the judgment of the Committee is equitably required. Any determination made under this Article X by the Committee shall be final and conclusive.

The issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services, either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the maximum number of shares as to which Options, SARs, Stock Awards, Stock Unit Awards and Incentive Awards may be granted, the terms of outstanding Stock Unit Awards, Stock Awards, Options, SARs, or Incentive Awards, or the individual limitations set forth in Section 5.03.

The Committee may grant Stock Awards, Stock Unit Awards, Options, and SARs in substitution for performance shares, phantom shares, stock awards, stock options, stock appreciation rights, or similar awards held by an individual who becomes an employee of the Company or a Related Entity in connection with a transaction described in the first paragraph of this Article X. Notwithstanding any provision of the Plan, the terms of such substituted Stock Unit Awards, Stock Awards, Option or SAR grants shall be as the Committee, in its discretion, determines is appropriate.

ARTICLE XI

CHANGE IN CONTROL

11.01.IMPACTOF CHANGEIN CONTROL

Unless an outstanding award is assumed in accordance with Section 11.02 and Article III to the contrary notwithstanding, upon a Control Change Date andcash-out of the award in accordance with Section 11.03, (i) an Option and SAR shall be fully exercisable thereafter, (ii) a Stock Award will become transferable and nonforfeitable thereafter, (iii) a Stock Unit Award shall be earned in its entirety and converted into a transferable and nonforfeitable Stock Award, and (iv) an Incentive Award shall be earned, in whole or in part, in accordance with the terms of the applicable Agreement, except that (i) a performance-based Option and SAR shall be exercisable thereafter, (ii) a performance-based Stock Award will become transferable and nonforfeitable thereafter, (iii) a performance-based Stock Unit Award will be earned and converted into a transferable and nonforfeitable Stock Award, and (iv) a performance-based Incentive Award shall be earned, in accordance with the terms of the applicable Agreement, only to the extent of actual performance through the Control Change Date or pro rata based on the elapsed portion of the performance period as of the Control Change Date, whichever the Committee determines.

11.02.ASSUMPTION UPON CHANGEIN CONTROL

In the event of a Change in Control the Committee, in its discretion and without the need for a Participant’s consent, may provide that an outstanding Option, SAR, Stock Award, Stock Unit Award or Incentive Award shall be assumed by, or a substitute award granted by, the surviving entity in the Change in Control. Such assumed or substituted award shall be of the same type of award as the original Option, SAR, Stock Award, Stock Unit Award or Incentive Award being assumed or substituted. The assumed or substituted award shall have a value, as of the Control Change Date, that is substantially equal to the value of the original award (or the difference between the Fair Market Value and the option price or Initial Value in the case of Options and SARs) as the Committee determines is equitably required and such other terms and conditions as may be prescribed by the Committee.

11.03.CASH-OUT UPON CHANGEIN CONTROL

Unless an outstanding award is assumed in accordance with Section 11.02 and Sections 6.04, 7.02, 8.02 and 9.02 to the contrary notwithstanding, in the event of a Change in Control, the Committee, in its discretion and without the need of a Participant’s consent, may provide that (i) each Option and SAR that is or will be exercisable on the Control Change Date, (ii) each Stock Award that is or will become transferable and nonforfeitable on the Control Change Date, (iii) each Stock Unit Award that is or will be earned and convertible into a transferable and nonforfeitable Stock Award on the Control Change Date and (iv) each Inventive Award that is or will be earned at the Control Change Date shall be cancelled in exchange for a payment. The payment may be in cash, shares of Common Stock or other securities or consideration received by Company shareholders in the Change in Control transaction. The amount of the payment shall be an amount that is substantially equal to (i) the amount by which the price per share received by Company shareholders in the Change in Control exceeds the Option price or Initial Value in the case of an Option and SAR for each share of Common Stock subject to an Option or SAR, (ii) the price per share received by shareholders for each share of Common Stock subject to a Stock Award or Stock Unit Award or (iii) the amount earned under the Incentive Award. Notwithstanding any other provision of the Plan, (i) each Option and SAR that is not and will not become exercisable on the Control Change Date, (ii) each Stock Award that is not and will not become transferable and nonforfeitable on the Control Change Date, (iii) each Stock Unit Award that is not and will not be earned and convertible into a transferable and nonforfeitable Stock Award on the Control Change Date and (iv) each Incentive Award that is not and will not become earned at the Control Change Date, shall be cancelled without any payment therefor.

ARTICLE XII

COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES

No Option or SAR shall be exercisable, no Common Stock shall be issued, no certificates for shares of Common Stock shall be delivered, and no payment shall be made under this Plan except in compliance with all applicable federal and state laws and regulations (including, without limitation, withholding tax requirements), any listing agreement to which the Company is a party, and the rules of all domestic stock exchanges on which the Company’s shares may be listed. The Company shall have the right to rely on an opinion of its counsel as to such compliance. Any share certificate issued to evidence Common Stock when a Stock Award is granted or for which an Option or SAR is exercised may bear such legends and statements as the Administrator may deem advisable to assure compliance with federal and state laws and regulations. No Option or SAR shall be exercisable, no Stock Award shall be granted, no Common Stock shall be issued, no certificate for shares shall be delivered, and no payment shall be made under this Plan until the Company has obtained such consent or approval as the Administrator may deem advisable from regulatory bodies having jurisdiction over such matters.

ARTICLE XIII

GENERAL PROVISIONS

13.01.EFFECTON EMPLOYMENTOR SERVICE

Neither the adoption of this Plan, its operation, nor any documents describing or referring to this Plan (or any part thereof) shall confer upon any individual any right to continue in the employ or service of the Company or a Related Entity or in any way affect any right and power of the Company or a Related Entity to terminate the employment or service of any individual at any time with or without assigning a reason therefor.

13.02.UNFUNDED PLAN

The Plan, insofar as it provides for grants, shall be unfunded, and the Company shall not be required to segregate any assets that may at any time be represented by grants under this Plan. Any liability of the Company to any person with respect to any grant under this Plan shall be based solely upon any contractual obligations that may be created pursuant to this Plan. No such obligation of the Company shall be deemed to be secured by any pledge of, or other encumbrance on, any property of the Company.

13.03.DISPOSITIONOF STOCK

A Participant shall notify the Administrator of any sale or other disposition of Common Stock acquired pursuant to an Option that was an incentive stock option if such sale or disposition occurs (i) within two years of the grant of an Option or (ii) within one year of the issuance of the Common Stock to the Participant. Such notice shall be in writing and directed to the Secretary of the Company.

13.04.RULESOF CONSTRUCTION

Headings are given to the articles and sections of this Plan solely as a convenience to facilitate reference. The reference to any statute, regulation, or other provision of law shall be construed to refer to any amendment to or successor of such provision of law.

All awards made under this Plan are intended to comply with, or otherwise be exempt from, Section 409A of the Code (“Section 409A”), after giving effect to the exemptions in Treasury Regulation sections1.409A-1(b)(3) through (b)(12). This Plan and all Agreements shall be administered, interpreted and construed in a manner consistent with Section 409A. If any provision of this Plan or any Agreement is found not to comply with, or otherwise not be exempt from, the provisions of Section 409A, it shall be modified and given effect, in

the sole discretion of the Committee and without requiring the Participant’s consent, in such manner as the Committee determines to be necessary or appropriate to comply with, or effectuate an exemption from, Section 409A. Each payment under an award granted under this Plan shall be treated as a separate identified payment for purposes of Section 409A.

If a payment obligation under an award or an Agreement arises on account of the Participant’s termination of employment and such payment obligation constitutes “deferred compensation” (as defined under Treasury Regulation section1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation sections1.409A-1(b)(3) through (b))12)), it shall be payable only after the Participant’s “separation from service” (as defined under Treasury Regulation section1.409A-1(h)); provided, however, that if the Participant is a “specified employee” (as defined under Treasury Regulation section1.409A-1(i)), any such payment that is scheduled to be paid within six months after such separation from service shall accrue without interest and shall be paid on the first day of the seventh month beginning after the date of the Participant’s separation from service or, if earlier, within fifteen days after the appointment of the personal representative or executor of the Participant’s estate following the Participant’s death.

13.05.EMPLOYEE STATUS

In the event that the terms of any Stock Award, Stock Unit Award or Incentive Award or the grant of any Option or SAR provide that shares may be issued or become transferable and nonforfeitable thereunder only after completion of a specified period of employment or service, the Administrator may decide in each case to what extent leaves of absence for governmental or military service, illness, temporary disability, or other reasons shall not be deemed interruptions of continuous employment or service.

13.06.WITHHOLDING TAXES

Each Participant shall be responsible for satisfying any income and employment tax withholding obligations attributable to participation in the Plan. Unless otherwise provided by the Agreement, any such withholding tax obligations may be satisfied in cash (including from any cash payable in settlement of a Stock Unit Award, an SAR or Incentive Award) or a cash equivalent acceptable to the Committee. Except to the extent prohibited by Treasury RegulationSection 1.409A-3(j), any withholding tax obligations may also be satisfied by surrendering shares of Common Stock to the Company, by withholding or reducing the number of shares of Common Stock otherwise issuable to the Participant upon the exercise of an Option or SAR, the settlement of a Stock Unit Award or Incentive Award or the grant or vesting of a Stock Award, but only up to the minimum required tax withholding rate that will not result in adverse financial accounting consequences with respect to such awards, or by any other method as may be approved by the Committee. If shares of Common Stock are used to pay all or part of such withholding tax obligation, the Fair Market Value of the shares surrendered, withheld or reduced shall be determined as of the date the Option or SAR is exercised, the Stock Award vests or the Stock Unit Award or Incentive Award is earned, as applicable.

13.07.CERTAIN REDUCTIONOF PARACHUTE PAYMENTS

The benefits that a Participant may be entitled to receive under this Plan and other benefits that a Participant is entitled to receive under other plans, agreements and arrangements (which, together with the benefits provided under this Plan, are referred to as “Payments”), may constitute Parachute Payments that are subject to Code Sections 280G and 4999. As provided in this Section 13.07, the Parachute Payments will be reduced pursuant to this Section 13.07 if, and only to the extent that, a reduction will allow a Participant to receive a greater Net After Tax Amount than a Participant would receive absent a reduction.

The Accounting Firm will first determine the amount of any Parachute Payments that are payable to a Participant. The Accounting Firm also will determine the Net After Tax Amount attributable to the Participant’s total Parachute Payments.

The Accounting Firm will next determine the largest amount of Payments that may be made to the Participant without subjecting the Participant to tax under Code Section 4999 (the “Capped Payments”). Thereafter, the Accounting Firm will determine the Net After Tax Amount attributable to the Capped Payments.

The Participant will receive the total Parachute Payments or the Capped Payments, whichever provides the Participant with the higher Net After Tax Amount. If the Participant will receive the Capped Payments, the total Parachute Payments will be adjusted by first reducing the amount of any benefits under this Plan or any other plan, agreement or arrangement that are not subject to Section 409A of the Code (with the source of the reduction to be directed by the Committee) and then by reducing the amount of any benefits under this Plan or any other plan, agreement or arrangement that are subject to Section 409A of the Code (with the source of the reduction to be directed by the Committee) in a manner that results in the best economic benefit to the Participant (or, to the extent economically equivalent, in a pro rata manner). The Accounting Firm will notify the Participant and the Company if it determines that the Parachute Payments must be reduced to the Capped Payments and will send the Participant and the Company a copy of its detailed calculations supporting that determination.

As a result of the uncertainty in the application of Code Sections 280G and 4999 at the time that the Accounting Firm makes its determinations under this Article XV, it is possible that amounts will have been paid or distributed to the Participant that should not have been paid or distributed under this Section 13.07 (“Overpayments”), or that additional amounts should be paid or distributed to the Participant under this Section 13.07 (“Underpayments”). If the Accounting Firm determines, based on either the assertion of a deficiency by the Internal Revenue Service against the Company or the Participant, which assertion the Accounting Firm believes has a high probability of success or controlling precedent or substantial authority, that an Overpayment has been made, the Participant must repay to the Company, without interest; provided, however, that no loan will be deemed to have been made and no amount will be payable by the Participant to the Company unless, and then only to the extent that, the deemed loan and payment would either reduce the amount on which the Participant is subject to tax under Code Section 4999 or generate a refund of tax imposed under Code Section 4999. If the Accounting Firm determines, based upon controlling precedent or substantial authority, that an Underpayment has occurred, the Accounting Firm will notify the Participant and the Company of that determination and the amount of that Underpayment will be paid to the Participant promptly by the Company.

For purposes of this Section 13.07, the term “Accounting Firm” means the independent accounting firm engaged by the Company immediately before the Control Change Date. For purposes of this Section 13.07, the term “Net After Tax Amount” means the amount of any Parachute Payments or Capped Payments, as applicable, net of taxes imposed under Code Sections 1, 3101(b) and 4999 and any State or local income taxes applicable to the Participant on the date of payment. The determination of the Net After Tax Amount shall be made using the highest combined effective rate imposed by the foregoing taxes on income of the same character as the Parachute Payments or Capped Payments, as applicable, in effect on the date of payment. For purposes of this Section 13.07, the term “Parachute Payment” means a payment that is described in Code Section 280G(b)(2), determined in accordance with Code Section 280G and the regulations promulgated or proposed thereunder.

Nothing in this Section 13.07 shall limit or otherwise supersede the provisions of any other agreement or plan which provides that a Participant cannot receive Payments in excess of the Capped Payments.

13.08.RETURNOF AWARDS; REPAYMENT

Each Stock Award, Option, SAR, Stock Unit Award and Incentive Award granted under this Plan is subject to approval by the condition that the Company may require that such award be returned, and that any payment made with respect to such award must be repaid, if such action is required under the terms of any Company recoupment or “clawback” policy as in effect on the date that the payment was made, on the date the award was granted or the date the Option or SAR was exercised or the date the Stock Award, Stock Unit Award or Incentive Award became vested or earned.

13.09.DEFERRALOF AWARDS

The Committee may permit a Participant to defer, or if and to the extent specified in an Agreement require the Participant to defer, receipt of the payment of cash or the delivery of shares of Common Stock that would otherwise be due by virtue of the lapse or waiver of restrictions with respect to awards, the satisfaction of any requirements or goals with respect to awards, the lapse or waiver of the deferral period for awards, or the lapse or waiver of restrictions with respect to awards. If the Committee permits such deferrals, the Committee shall establish rules and procedures for making such deferral elections and for the payment of such deferrals, which shall be intended to conform in form and substance with applicable regulations promulgated under Section 409A of the Code and Section 13.04. Except as otherwise provided in an Award Agreement, any payment or any shares of Common Stock that are subject to such deferral shall be made or delivered to the Participant as specified in the Agreement or pursuant to the Participant’s deferral election.

13.10.EXTENSIONOF TERMOF AWARD

Notwithstanding any provision of the Plan providing for the maximum term of an award, in the event any award would expire prior to exercise, vesting or settlement because trading in shares of Common Stock is prohibited by law or by any insider trading policyshareholders of the Company the Committee may extend the term of the award (or provideat a meeting duly called for such inpurposes. The Proposed Amendments may not occur unless and until this Amendment No. 1 is approved by the applicable Agreement) until thirty (30) days after the expiration of any such prohibitions to permit the Participant to realize the value of the award, provided such extension (i) is permitted by law, (ii) does not violate Section 409A of the Code with respect to any award, and (iii) does not otherwise adversely impact the tax consequences of the award (suchshareholders. Except as incentive stock options and related awards).

13.11.SECTION 162(m) TRANSITION RULE

Subject to Article XIV below, if and to the extent that the Committee grants an award under the Plan in substitution for an award intended to constitute “qualified performance-based compensation” under Section 162(m) of the Code, as in effect prior to the enactment of the Tax Cuts and Jobs Act of 2017, then such award shall be (i) subject to such terms and conditions as are required for the award to continue to qualify under the transition rule for “qualified performance-based compensation” under Section 162(m) of the Code under the Tax Cuts and Jobs Act of 2017, as the Committee shall determine, (ii) the award will be administered by asub-committee of the Committee which is comprised of two or more members that qualify as “outside directors” under Section 162(m) of the Code prior to the enactment of the Tax Cuts and Jobs Act of 2017, and (iii) none of the provisions ofhereby modified, the Plan shall apply to such award to the extent such provisions would resultremain in the award no longer qualifying under the transition rule for “qualified performance-based compensation” under Section 162(m)full force and effect.

[Remainder of the Code prior to the Tax Cuts and Jobs Act of 2017.page left intentionally blank]

ARTICLE XIV

AMENDMENT

The Board may amend or terminate this Plan from time to time; provided, however, that no amendment may become effective until shareholder approval is obtained if (i) the amendment materially increases the aggregate number of shares of Common Stock that may be issued under the Plan (other than an adjustment pursuant to Article X), (ii) the amendment materially increases the benefits accruing to Participants under the Plan, (iii) the amendment materially changes the class of individuals eligible to become Participants or (iv) the amendment is required to be approved by shareholders by the requirements of applicable law or under the New York Stock Exchange’s shareholder approval rules. For the avoidance of doubt, the Board may not (except pursuant to Article X) without the approval of shareholders (a) reduce the option price per share of an outstanding Option or the Initial Value of an outstanding SAR, (b) cancel an outstanding Option or outstanding SAR when the option price or Initial Value, as applicable exceeds the Fair Market Value (whether in exchange for (i) other Options or SARs with option prices or Initial Values, as applicable, that are less than the option prices or Initial Values of the cancelled Options or SARs, (ii) cash payments, (iii) shares of Common Stock, or

(iv) other awards) or (c) take any other action with respect to an outstanding Option or an outstanding SAR that may be treated as a repricing of the award under the rules and regulations of the New York Stock Exchange. No amendment shall, without a Participant’s consent, adversely affect any rights of such Participant under any award outstanding at the time such amendment is made.

ARTICLE XV

DURATION OF PLAN

No Stock Award, Stock Unit Award, Option, SAR or Incentive Award may be granted under this Plan after the tenth (10th) anniversary of the date the Board adopted the Plan. Awards granted on or before such date shall remain subject to their terms notwithstanding the expiration of the Plan.

ARTICLE XVI

EFFECTIVE DATE OF PLAN

Stock Unit Awards, Options, SARs and Incentive Awards may be granted under this Plan on and after the date the Board adopts the Plan; provided, however, Stock Awards may only be granted after, and no award granted under the Plan may become exercisable, transferable and nonforfeitable, payable or settled until, the Plan is approved by a majority of the votes cast by the Company’s shareholders, voting either in person or by proxy, at a duly held shareholders’ meeting within twelve (12) months of its adoption by the Board.

Owens & Minor, Inc. Annual Meeting of Shareholders

Tuesday, May 8, 2018 — 9:00 A.M. EDT

at

The Jefferson Hotel

Empire Room

101 West Franklin Street

Richmond, Virginia, 23220

From Washington, D.C., followI-95 South to Exit 76B towardsUS-1/US-301/Belvidere Street. Turn left onto W Leigh Street, then right onto N Belvidere Street. Turn left onto W Franklin Street. Turn right onto N Jefferson Street.

From Petersburg, followI-95 North to Exit74A/I-195 N/Downtown Expressway; continue toVA-195 W and take exit towardUS-1/US-301/Belvidere Street. Merge onto Canal Street. Turn right onto S Jefferson Street. Turn left onto W Main Street. Turn right onto N Madison Street. Turn right onto W Franklin Street. Turn right onto N Jefferson Street.

From Charlottesville, followI-64 East to Exit 76B towardsUS-1/US-301/Belvidere Street. Turn left onto W Leigh Street, then right onto N Belvidere Street. Turn left onto W Franklin Street. Turn right onto N Jefferson Street.

From Norfolk, followI-64 West and take Exit 76A/Chamberlayne Ave. Travel South on Chamberlayne Parkway, slight right onto N Adams Street. Turn right onto W Grace Street. Turn left onto N Jefferson Street.

From the Airport, departing from the airport, bear right at Airport Drive. Continue on Airport Drive toI-64 West ramp heading toward Richmond. Take Exit 76A/Chamberlayne Ave. Travel South on Chamberlayne Parkway, slight right onto N Adams Street. Turn right onto W Grace Street. Turn left onto N Jefferson Street.2024 Proxy StatementA-1



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IMPORTANT ANNUAL MEETING INFORMATION
Electronic Voting Instructions
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone must be received by 11:59 p.m., Eastern Daylight Time, May 7, 2018.
Vote by Internet
• Go to www.envisionreports.com/OMI
• Or scan the QR code with your smartphone
• Follow the steps outlined on the secure website
Vote by telephone
• Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone
• Follow the instructions provided by the recorded message
Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.
Annual Meeting Proxy Card


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Your vote matters – here’s how to vote!

You may vote online or by phone instead of mailing this card.

LOGOVotes submitted electronically must be received by May 8, 2024 at 11:59 P.M., Eastern Daylight Time

Online

Go to www.envisionreports.com/OMI or scan the QR code – login details are located in the shaded bar below.

LOGO

Phone

Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada

Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.

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Save paper, time and money!

Sign up for electronic delivery at www.envisionreports.com/OMI

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IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION,VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
A Proposals — The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2, 3 and 4.
1. Election of Directors:
For Against Abstain
01 - Stuart M. Essig
04 - Lemuel E. Lewis
07 - Eddie N. Moore, Jr.
10 - Anne Marie Whittemore
02 - John W. Gerdelman
05 - Martha H. Marsh
08 - P. Cody Phipps
For Against Abstain
03 - Barbara B. Hill
06 - Mark F. McGettrick
09 - Robert C. Sledd
For Against Abstain
2. Vote to approve the Owens & Minor, Inc. 2018 Stock Incentive Plan.
For Against Abstain
3. Vote to ratify KPMG LLP as the Company’s independent public accounting firm for 2018.
For Against Abstain
For Against Abstain
4. Advisory vote to approve executive compensation.
B Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below
NOTE:

A

Proposals – The Board of Directors recommends a vote FOR all nominees and FOR Proposals 2, 3 and 4.

1.Election of nine Directors, each for a one-year term and until their respective successors are elected and qualified:LOGO

ForAgainstAbstainForAgainstAbstainForAgainstAbstain
01 - Mark A. Beck02 - Gwendolyn M. Bingham03 - Kenneth Gardner-Smith
04 - Robert J. Henkel05 - Rita F. Johnson-Mills06 - Stephen W. Klemash
07 - Teresa L. Kline08 - Edward A. Pesicka09 - Carissa L. Rollins

   For  Against  

Abstain

      For  Against  Abstain
2. Ratification of the appointment of KPMG LLP as the Company’s independent public accounting firm for the year ending December 31, 2024.         3. Approval of Amendment No. 1 to the Owens & Minor, Inc. 2023 Omnibus Incentive Plan.      
4. Advisory vote to approve the compensation of the Company’s named executive officers.         5. To transact any other business as may properly come before the Annual Meeting.      
                 

B

Authorized Signatures – This section must be completed for your vote to count. Please date and sign below.

Please sign exactly as namename(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or guardian,custodian, please give full title as such.
Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box.
IF VOTING BY MAIL, YOU MUST COMPLETE SECTIONS A AND B ON BOTH SIDES OF THIS CARD.
1UP X
02SMVC


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title.

 

Date (mm/dd/yyyy) – Please print date below.   Signature 1 – Please keep signature within the box.   Signature 2 – Please keep signature within the box.
   /  /

2018

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1 U P X

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03YPLC


The 2024 Annual Meeting of Shareholders of Owens & Minor, Inc.
will be held on

Thursday, May 8, 20189, 2024 at 9:00 a.m. The Jefferson Hotel 101 West Franklin Street Richmond, Virginia 23220
EDT, virtually via the Internet at www.meetnow.global/MQUPCLA.

To access the virtual meeting, you must have the information that is printed in the shaded bar

located on the reverse side of this form.

Important notice regarding the Internet availability of proxy materials for the Owens & Minor, Inc. 2018 Annual Meeting of Shareholders.

The 20182024 Proxy Statement and the 20172023 Annual Report/Form 10-K to Shareholders are available at: www.envisionreports.com/OMI

LOGO

Small steps make an impact.

Help the environment by consenting to receive electronic

delivery, sign up at www.envisionreports.com/OMI

LOGO

IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION,VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.

LOGOLOGO

 Proxy – Owens & Minor, Inc.

Annual Meeting of Shareholders to be held May 9, 2024

This Proxy — Owens & Minor, Inc.
ANNUAL MEETING OF SHAREHOLDERS – MAY 8, 2018
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY The undersigned hereby appoints Lemuel E. Lewis, Robert C. Sledd, and Anne Marie Whittemore, and eachis solicited by the Board of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the sharesDirectors of Owens & Minor, Inc. Common Stock

Mark A. Beck, Stephen W. Klemash and Edward A. Pesicka, or any of them, each with the power of substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the powers which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come beforewould possess if personally present, at the Annual Meeting of Shareholders of Owens & Minor, Inc. to be held on May 8, 2018,9, 2024 or at any postponement or adjournment or postponement thereof, with all powers which the undersigned would possess if present at the meeting. Ifthereof.

Shares represented by this proxy is executed, but no instructions are made, this proxy card will be voted as directed by the shareholder. If no such directions are indicated, the Proxies will have authority to vote “FOR” each of the directorall nominees named in Proposal 1 and “FOR” Proposals 2, 3 and 4 and otherwise in the discretion of the proxies upon such other business as properly comes before the annual meeting.
(Continued and to be marked, dated and signed, on the other side)
C Non-Voting Items
Change of Address — Please print your new address below. Comments — Please print your comments below.
Meeting Attendance
Mark the box to the right if you plan to attend the Annual Meeting.
IF VOTING BY MAIL, YOU MUST COMPLETE SECTIONS A AND B ON BOTH SIDES OF THIS CARD.


LOGO

IMPORTANT ANNUAL MEETING INFORMATION
Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.
Annual Meeting Proxy Card
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
A Proposals —4. The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2, 3 and 4.
1. Election of Directors: For Against Abstain
01 - Stuart M. Essig
04 - Lemuel E. Lewis
07 - Eddie N. Moore, Jr.
10 - Anne Marie Whittemore
For Against Abstain
02 - John W. Gerdelman
05 - Martha H. Marsh
08 - P. Cody Phipps
For Against Abstain
03 - Barbara B. Hill
06 - Mark F. McGettrick
09 - Robert C. Sledd
2. Vote to approve the Owens & Minor, Inc. 2018 Stock Incentive Plan.
For Against Abstain
3. Vote to ratify KPMG LLP as the Company’s independent public accounting firm for 2018.
For Against Abstain
4. Advisory vote to approve executive compensation.
For Against Abstain
B Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such.
Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box.
1UP X
02SMWC


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2018 Annual Meeting of Shareholders of Owens & Minor, Inc.
May 8, 2018 at 9:00 a.m. The Jefferson Hotel 101 West Franklin Street Richmond, Virginia 23220
Important notice regarding the Internet availability of proxy materials for the Owens & Minor, Inc. 2018 Annual Meeting of Shareholders. The 2018 Proxy Statement and the 2017 Annual Report/Form 10-K to Shareholders are available at: www.edocumentview.com/OMI
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
Proxy — Owens & Minor, Inc.
ANNUAL MEETING OF SHAREHOLDERS – MAY 8, 2018
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned hereby appoints Lemuel E. Lewis, Robert C. Sledd, and Anne Marie Whittemore, and each of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the shares of Owens & Minor, Inc. Common Stock which the undersigned is entitled to vote, and,Proxies, in their discretion, are further authorized to vote upon such other business as may properly come before the 2024 Annual Meeting of Shareholders of Owens & Minor, Inc.and any postponements or adjournments thereof.

(Items to be held May 8, 2018, or at any adjournment or postponement thereof, with all powers which the undersigned would possess if present at the meeting.
If this proxy is executed, but no instructions are made, this proxy card will be voted “FOR” each of the director nominees, “FOR” Proposals 2, 3 and 4 and otherwise in the discretion of the proxies upon such other business as properly comes before the annual meeting.
(Continued and to be marked, dated and signed,appear on the otherreverse side)

C Non-Voting Items

Change of Address – Please print new address below.

Comments – Please print your comments below.

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