Mr. Aaro brings to our Board extensive knowledge of marketing and entrepreneurship. His over thirty30 years of experience leading marketing strategy for numerous CPG and technology companies and experience as an entrepreneur provides valuable insight to our Board.

Michael Doar, age 65,67, has been a member of the Board since 2000. Mr. Doar was elected Chairman of the

Board and appointed our Chief Executive Officer (“CEO”) in fiscal 2001. Heyear 2001, a position he held until March 2021, when he transitioned to the role of Executive Chairman. Mr. Doar also served as our President from November 2009 to March 2013. Prior to joining Hurco, Mr. Doar served as Vice President of Sales and Marketing of Ingersoll Contract Manufacturing Company, a subsidiary of Ingersoll International, an international engineering and machine tool systems business, having previously held various management positions with Ingersoll International from 1989. Mr. Doar also serves as a director of Twin Disc, Incorporated, a manufacturer of marine and heavy duty off-highwayoff- highway power transmission equipment.

Mr. Doar has led Hurco for more than nineteen20 years. As our current Executive Chairman and former CEO, Mr. Doar brings to our Board his in-depth knowledge of our business, strategy, people, operations, competition, and financial position. Mr. Doar also provides leadership and vision for the development and execution of our strategic plans and the achievement of our business goals and objectives.

Cynthia Dubin, age 59,61, has been a member of the Board since March 2019. Ms. Dubin is an experienced chief financial officer and board director. In February 2019, Ms. Dubin was appointed to the board of the U.K. Competition and Markets Authority (“CMA”) and is currently the Interim-ChairChair of its Nominations Committee and Audit and Risk Assurance Committee. The CMA is a non-ministerial government department in the United Kingdom, responsible for strengthening business competition and preventing and reducing anti-competitive activities. Ms. Dubin served as the CFO of Pivot Power LLP, an emerging leader in power storage and electric vehicle infrastructure in the U.K., from August 2018 to March 2019. Ms. Dubin was also the CFO for JKX Oil & Gas PLC,Ltd. from 2011 to 2016 and CFO for Canamens Ltd. from 2006 to 2011. These companies were London Stock Exchange listed and private equity-backed oil and gas exploration and production companies, respectively. Additionally, Ms. Dubin was European CFO for Edison Mission Energy, a pre-eminent builder, owner, and operator of large-scale power generation projects, and started her career as a project finance banker with Irving Trust Company. From 2015 to September 2020, she served on the Board of Directors of Babcock & Wilcox Enterprises, Inc., an NYSE-listeda New York Stock Exchange-listed global leader inprovider of advanced energy and environmental technologies and services for the power and industrial markets with operations, subsidiaries, and joint ventures worldwide. During her service, she served as the Chair of its Audit and Finance Committee and a member of its Governance Committee. SinceFrom September 2020 through November 2022, Ms. Dubin has served as a director for Synthomer plc, a publicly-traded chemicals manufacturer specializing in aqueous polymers, and isduring such time was also the Chair of its Audit Committee and a member of its remuneration committee.Remuneration and Nomination Committees. Since December 2020, Ms. Dubin has also served as a director for ICE Futures Europe, an exchange for futures and options contracts for crude oil, interest rates, equity derivatives, natural gas, power, coal, emissions, and soft commodities, and is a membercurrently also the chair of its Audit Committee. Ms. Dubin became a director and Chair of the Audit Committee and member of the Compensation Committee for Franchise Group, Inc. in May 2021. Franchise Group is a holding company for a franchising platform for an increasingly diverse collection of market-leading and emerging brands.

Ms. Dubin brings to our Board thorough knowledge and understanding of complex international corporate finance, mergers and acquisitions, capital markets, and risk management and oversight.

Timothy J. Gardner, age 65,67, has been a member of the Board since March 2017. SinceA seasoned leader in industrial and international manufacturing operations, from 2016 to March 2021, Mr. Gardner has beenserved as the Managing Director of Akoya Capital, responsible for leading Akoya’s industrial product sector. SinceFrom 2015 to December 2020, Mr. Gardner also has been servingserved as a Senior Advisor for Pritzker Private Capital (“Pritzker”) and a board member of LBP Manufacturing, a packaging company acquired by Pritzker. From 2009 to 2014, Mr. Gardner served as the Executive Vice President of Illinois Tool Works (“ITW”) and led ITW’s consumer products segment, a $1.6 billion business focused on packaging and specialty decorating.

Between 1997 and 2009, Mr. Gardner held various leadership positions within ITW. Mr. Gardner also serves on the boards of multiple not-for-profit organizations and is a member of the Audit Committee for the Keep America Beautiful organization located in Stamford, Connecticut.

Mr. Gardner brings to our Board extensive leadership experience in industrial and international manufacturing operations, as well as extensive knowledge and experience in finance and acquisitions and divestitures. During his tenure at ITW, Mr. Gardner led ten acquisitions and four divestitures and managed multiple division and group financial controllers.

Jay C. Longbottom, age 67,69, has been a member of the Board since March 2015. Mr. Longbottom is currently an Operating Partner of the BERKS Group, a privately held investment initiative, a position he has held since 2018. Previously, from 2013 to 2017, Mr. Longbottom was CEO of Robert Family Holdings (“RFH”), a privately-held company that manages a portfolio of specialty manufacturers, was a board member of RFH from 2008 to 2017, and served as RFH’s Audit Committee Chair from 2008 to 2013. For one year prior to his RFH positions,tenure, Mr. Longbottom served as CEO of Trostel, LLC, a rubber products company. Additionally, from 2002 to 2012, Mr. Longbottom was an executive of Haldex AB, a Swedish, publicly-traded, company that provides proprietary and innovative solutions to improve safety, vehicle dynamics, and environmental sustainability in the global commercial vehicle industry. Mr. Longbottom served as the CEO and President of Haldex AB from 2011 to 2012. Prior to 2011, he was the Executive Vice President and Head of the Commercial Vehicle Systems Division and the President of the Hydraulics Division of Haldex Group.

Mr. Longbottom brings to our Board significant knowledge in finance, mergers and acquisitions, and international manufacturing operations. His experience as a CEO of a Swedish, publicly-traded, company is especially relevant to understanding regulations and capital market requirements. Mr. Longbottom also currently serves as a director of two privately-held companies, was a director of RFH for nine years, and has served as a director offor a number of international companies.

Richard Porter, age 65,67, has been a member of the Board since 2012. Mr. Porter has managed a private equity portfolio of manufacturing companies since 2007. Previously, he was President of CB Manufacturing, a cutting tool company, and President of Ingersoll Contract Manufacturing Company, a subsidiary of Ingersoll International.

Mr. Porter brings to our Board extensive experience in the machine tool industry, particularly in product and contract manufacturing. Mr. Porter also has experience serving on the boards of a number of private companies with annual revenues ranging from approximately $40 million to $480 million.

Janaki Sivanesan, age 49,51, has been a member of the Board since 2008. Ms. Sivanesan is a practicing attorney and founding principal of a private equity firm focused on middle-market investments. She previously served as a partner at a large, New York law firm. She was admitted to the bars of the States of New York and Georgia in 2007 and 1996, respectively. Since 2020, Ms. Sivanesan has also served as a director of Essential Properties Realty Trust, Inc., a publicly-traded real estate investment trust that acquires, owns, and manages primarily single-tenant properties that are net leased on a long-term basis to companies operating service-oriented or experience-based businesses. Ms. Sivanesan has experience in a wide range of corporate transactions, from mergers and acquisitions to corporate finance, including private debt, equity investments, and venture capital transactions. Ms. Sivanesan also has experience in cross-border transactions related to manufacturing and outsourcing and is particularly knowledgeable with respect to business operations in India. Ms. Sivanesan served as the General Counsel and Chief Compliance Officer of Hayfin Capital Management, LLC (formerly known as Kingsland Capital Management, LLC), from 2011 to 2018, and has been self-employed as an attorney in private practice since 2009.

Ms. Sivanesan provides to the Board and Audit Committee thorough knowledge and understanding of complex legal and capital markets transactions, as well as corporate mergers and acquisitions.

Gregory S. Volovic, age 57,59, has been a member of the Board since March 2019,2019. He has been employed by us since March 2005, was appointed as our President sincein March 2013, and served as our Chief Operating Officer since 2019.from March 2019 until he was appointed as our CEO in March 2021. Mr. Volovic oversees all of Hurco’s operations, including worldwide sales, service, end-to-end management of research and development, new product development activities, and operational initiatives. He has held various positions within Hurco, most recently Executive Vice President, Software and Engineering, before becoming President in 2013. Prior to joining Hurco, Mr. Volovic led the advanced manufacturing equipment development program for the CRT division of RCA/Thomson and the worldwide development of Information Technology (IT) and E-business/E- business/Knowledge Management technologies. He also held various positions within Thomson, including Director of E-Business, Engineering, and Information Technology. Mr. Volovic started his career as a software developer for Unisys Corporation, where he was a UnixLinux programmer. Mr. Volovic also serves on the boardboards of atwo privately held companycompanies and is a board member of the Association of Manufacturing Technology (i.e., AMT)(AMT).

Mr. Volovic brings to our Board his significant knowledge of the machine tool industry, as well as his experience and understanding of our technologies, product development, business strategies, people, and operations. Mr. Volovic also provides directionleadership and guidancevision for the development and execution of our product strategies,strategic plans and the achievement of our business goals and objectives.

Board Diversity, Director Experience and Qualifications, and Board Composition

While neither the Board nor the Nominating and Governance Committee has a formal written policy regarding director diversity, each body considers the diversity of backgrounds and experience when selecting nominees for director election and in evaluating Board composition and performance. Not only has this informal approach to the promotion of diversity resulted in a group of director nominees that we believe to be individuals of substantial accomplishment with demonstrated leadership capabilities, but, as indicated in the following charts, it has also resulted in a group of director nominees possessing diversity of thought, perspective, experience, and backgrounds.

In further demonstration of the value the Board places on diversity, it also considers the diversity of background and experience when appointing our executive officers. To that end, and as indicated in the chart below, our executive officer team is a diverse group of individuals representative of both Hurco’s global footprint and the communities in which we operate.

The Board of Directors recommends a vote “FOR” each of the nominees for director.

CORPORATE GOVERNANCE

Policies on Corporate Governance

Our Board believes that good corporate governance is important to ensure that our Company is managed for the long-term benefit of our shareholders. The Board or one of its committees periodically reviews our Corporate Governance Principles, the written charters for each of the standing committees of the Board, and our Code of Business Conduct and Ethics, and amends them as appropriate to reflect new policies or practices.

Board Leadership Structure

Our Board is currently led by our Executive Chairman, Mr. Doar, our Chairman and CEO.Doar. Mr. Doar has held these positionsthis position since 2001March 2021. Prior to transitioning to the role of Executive Chairman, Mr. Doar served as our Chairman and CEO since 2001. Therefore, he has experience in leading the Company through a range of changes in business environments. environments and has vast institutional knowledge about our business, industry, and people.

The Board regularly reevaluates our Board leadership structure and succession planning and may determine that a different leadership structure is appropriate in the future. The Board currently believes that it is most efficient and effective for a single individualan executive officer of the Company to fulfill these two leadership roles at this time. Combiningserve as Executive Chairman of the Board. Assumption of the Chairman role by an executive officer facilitates continuous and broad Board access to, and communication with, the CEO, roles facilitates clear leadershipmanagement team, and the Company’s outside advisors. It also promotes responsibility and accountability, effective decision-making, and a cohesive corporate strategy. Our Board possesses considerable experience and knowledge of the challenges and opportunities that we face as a company. We feel the Board is well qualified to evaluate our current and future needs and to assess how the capabilities of our senior management can be most effectively organized to meet those needs.

Our Board currently has sevensix independent directors. We have three standing committees, and as required by our Corporate Governance Principles during times where the same individual holds the Chairman and CEO positions, one of our independent directors serves as our Presiding Independent Director. The independent directors have designated Mr. CruickshankPorter to serve as Presiding Independent Director, and the independent directors intend to designate a new Presiding Independent Director immediately following the 2021 Annual Meeting since Mr. Cruickshank is not a nominee for re-election to the Board.Director. The Presiding Independent Director oversees executive sessions of the independent directors and plays an active role in setting Board agendas and facilitating interactions between the independent directors, on the one hand, and the full Board or management, on the other. The Board evaluates the appropriateness of its leadership structure on an ongoing basis and may change it as circumstances warrant. We believe that each of these measures counter-balancescounterbalances any risk that may exist in having Mr. Doar serve as both an executive employee of the Company and as Executive Chairman and CEO.of the Board. For these reasons, our Board believes this leadership structure is effective for our Company.company.

Board Role in Risk Oversight

Our Board regularly receives reports from our CEO and other members of our senior management team regarding areas of significant risk to us, including strategic, operational, financial, legal, regulatory, and reputational risks. However, management is responsible for assessing and managing our various risk exposures on a day-to-day basis. In this regard, management, with the assistance, where appropriate, of its counsel and other advisors, has established functions that focus on particular risks, such as legal matters, regulatory compliance, treasury management, research and development, supply chain, and quality control, and has developed a comprehensive and integrated approach to overall risk management, which includes the identification of risks and mitigation plans in the strategic planning process.

Our Board’s role is primarily one of oversight. Our Board oversees our risk management processes to determine whether those processes are functioning as intended and are consistent with our business and strategy. Our Board conducts this oversight primarily through the Audit Committee, although some aspects of risk oversight are performed by the full Board or another committee. The Audit Committee is assigned with, among other things, oversight of our risks relating to accounting matters, financial reporting, and legal and regulatory compliance. The Audit Committee meets regularly with our Chief Financial Officer (“CFO”), external auditors, internal auditors, legal counsel, and management to discuss our major financial risk exposures and the steps management has taken to monitor and control such exposures, including our risk assessment and risk management policies. The Audit Committee also receives regular reports regarding issues such as the status and findings of audits being conducted by our independent auditors, the status of material litigation, and material accounting changes or proposed audit adjustments that could affect our financial statements. Our Audit Committee has standing items on its quarterly meeting agendas relating to these responsibilities. The Audit Committee members, as well as all other directors, have access to our CFO, internal auditors, and any other member of our management for discussions between meetings, as warranted. The Audit Committee provides reports to the full Board on risk-related items.

The activities of the Compensation Committee with respect to risks relating to our compensation policies and procedures are discussed below in the Executive Compensation section of this proxy statement.

Director Independence and Board Meetings

The Board has determined that each of our non-employee directors Messrs.– Mr. Aaro, Cruickshank, Gardner, Longbottom, and Porter, Ms. Dubin, Mr. Gardner, Mr. Longbottom, Mr. Porter, and Ms. Sivanesan – is “independent” as defined by the listing standards of The Nasdaq Stock Market (the market in which our common stock trades), or Nasdaq, and the director independence rules of the Securities and Exchange Commission, or SEC. The Board has affirmatively determined that none of the persons who served as independent directors during fiscal 2020year 2022 has any relationship with us that would impair their independence.

Directors are expected to attend Board meetings, meetings of committees on which they serve, and our Annual Meeting of Shareholders, and to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities. The Board held five meetings during fiscal 2020.year 2022. All directors attended at least 75% of the aggregate number of meetings of the Board and the committees on which they served during fiscal 2020.year 2022. All incumbent directors and director nominees, as of that date, attended our 20202022 Annual Meeting of Shareholders.

Board Committees and Committee Meetings

The Board of Directors has three standing committees: the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee. The members of the committees, as of the date of this proxy statement, are identified in the following table.

Audit Committee

The Audit Committee oversees our accounting, financial reporting, and internal audit activities. It appoints our independent registered public accounting firm and meets with that firm, our internal audit team, and our CFO to review the scope, cost, and results of our annual audit and to review our internal accounting controls, policies, and procedures. The Report of the Audit Committee is included on page 5063 of this proxy statement.

All members of the Audit Committee are “independent” as such term is defined for audit committee members under the Nasdaq rules and SEC Rule 10A-3 promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act. The Board has determined that both Mr. Longbottomeach of Ms. Dubin and Ms. Sivanesan qualifyqualifies as an “audit committee financial expert,” as defined in Item 407(d)(5)(ii) of Regulation S-K of the Exchange Act.

The Audit Committee held sixfive meetings during fiscal 2020.year 2022.

The Audit Committee operates under a written charter, a copy of which is available on our website at www.hurco.com/investors under “Corporate Governance.”

Compensation Committee

The Compensation Committee reviews and recommends to the Board the compensation of our officers and managers and guidelines for the general wage structure of our entire workforce. The Compensation Committee also oversees the administration of our employee benefit plans and discusses with management the Compensation Discussion and Analysis and, if appropriate, recommends its inclusion in our Annual Report on Form 10-K and proxy statement. In determining the compensation of the executive officers other than our CEO and Executive Chairman, the Compensation Committee considers the recommendations of the CEO. The Report of the Compensation Committee is included on page 3141 of this proxy statement.

All members of the Compensation Committee are “independent” as such term is defined for compensation committee members under the Nasdaq rules and SEC Rule 10C-1 promulgated under the Exchange Act.

The Compensation Committee held sixfive meetings during fiscal 2020.year 2022.

The Compensation Committee operates under a written charter, a copy of which is available on our website at www.hurco.com/investors under “Corporate Governance.”

Compensation Committee Interlocks and Insider Participation

No member of our Compensation Committee was, at any time during fiscal 2020year 2022, or at any other time before fiscal 2020,year 2022, an officer or an employee of the Company. In addition, none of the members of the Compensation Committee werewas involved in a relationship requiring disclosure as an interlocking executive officer or director under Item 407(e)(4) of Regulation S-K of the Exchange Act. None of our executive officers served as a member of the Compensation Committee at any time during or before fiscal 2020.year 2022.

Nominating and Governance Committee

The Nominating and Governance Committee assists the Board by identifying individuals qualified to become Board members, maintains our Corporate Governance Principles and Code of Business Conduct and Ethics, leads the Board in an annual self-evaluation, recommends members and chairs for each standing committee, and determines and evaluates succession plans for our CEO.

All members of the Nominating and Governance Committee are independent directors as defined by Nasdaq rules.

The Nominating and Governance Committee held threefour meetings during fiscal 2020.year 2022.

The Nominating and Governance Committee is responsible for identifying potential Board members or nominees. The Nominating and Governance Committee does not have a formal written policy regarding the consideration of diversity in identifying nominees for directors. It does, however, consider the diversity of backgrounds and experiences of director candidates when identifying director nominees and evaluating the performance of the BoardBoard’s composition and its standing committees.performance. The Nominating and Governance Committee also examines the following qualifications and skills of director candidates, among other things: their business or professional experience, their integrity and judgment, their records of public service, their ability to devote sufficient time to the affairs of the Company, and the needs of the Board for certain skills or experiences. The Nominating and Governance Committee also believes that all nominees should be individuals of substantial accomplishment with demonstrated leadership capabilities.

The Nominating and Governance Committee will consider candidates for director who are recommended by shareholders. A shareholder who wishes to recommend a director candidate for consideration by the committee should send such recommendation to our Corporate Secretary at One Technology Way, Indianapolis, Indiana 46268, who will forward it to the committee. Any such recommendation should include a description of the candidate’s qualifications for Board service and contact information for the shareholder and the candidate.

A shareholder who wishes to nominate an individual as a candidate for director without the recommendation of the Nominating and Governance Committee must comply with the advance notice and informational requirements set forth in our By-Laws, which are more fully explained later in this proxy statement under “Shareholder Proposals for our 20222024 Annual Meeting.”

The Nominating and Governance Committee operates under a written charter, a copy of which is available on our website at www.hurco.com/investors under “Corporate Governance.”

Shareholder Communications

The Board has implemented a process whereby shareholders may send communications to its attention. The process for communicating with the Board is set forth in our Corporate Governance Principles, which are available on our website at www.hurco.com/investors under “Corporate Governance.”

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our directors and executive officers, and persons who own more than 10% of our common stock, to file reports of ownership with the SEC and Nasdaq.

Based solely on our review of such forms filed with the SEC, and written representations from certain reporting persons that they were not required to file a Form 5 to report previously unreported ownership or changes in ownership, we believe that, during our fiscal year ended October 31, 2022, all of our executive officers, directors, and greater than 10% beneficial owners complied with all filing requirements under Section 16(a), except as described immediately below.

On Sunday, January 2, 2022, certain outstanding restricted stock awards for each of Mr. Doar and Mr. Volovic vested, resulting in the following amounts of shares being withheld to satisfy these officers’ respective tax obligations for the vested portion of the underlying awards: (1) for Mr. Doar, 1,943 shares; and (2) for Mr. Volovic, 1,161 shares. However, due to an administrative error and temporary technical difficulties experienced by our outside filing service provider with the EDGAR filing system, each Form 4, used to report such tax withholding dispositions on behalf of these individuals, was not filed until January 5, 2022 – one day late with respect to such tax withholding dispositions under applicable beneficial ownership reporting rules. The Form 4 filed on behalf of each such executive was only late with respect to the transactions specifically referenced above.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics, which applies to all of our directors, executive officers, and employees, including our principal executive officer and principal financial officer. If we grant any waiver to the Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, we will disclose the nature of such waiver in a Current Report on Form 8-K that we will file with the SEC or on our website at www.hurco.com/investors under “Corporate Governance.” A copy of the Code of Business Conduct and Ethics is available on our website at www.hurco.com/investors under “Corporate Governance.” We will disclose any amendments or updates to our Code of Business Conduct and Ethics by posting such amendments or updates on our website.

Environmental, Social, and Governance Matters

AsOur Board has adopted an Environmental, Social, and Governance Policy (the “ESG Policy”), which is both set forth immediately below and available on our website at www.hurco.com/investors under “Corporate Governance.”

Hurco Companies, Inc. (“Hurco,” “we,” “us,” or “our”) believes that: (1) business, at its best, serves the public good, improves the quality of peoples’ lives, and leaves the world a global, industrial-technology company, we believe we are in a position to help address a variety of environmental, social, and governance-related (“ESG”) matters. And, we thinkbetter place; (2) it is an inherent and critical component of sound corporate citizenship to be responsive to ESG issuesenvironmental, social, and governance-related (“ESG”) matters that directly impact our business, industry, stakeholders, and the communities in which we operate; (3) as a global, industrial technology company, we are in a unique position to help address a variety of ESG issues; and (4) profitable growth and meaningful responsiveness to ESG matters are not mutually exclusive.

Accordingly, Hurco is committed to being responsive to ESG matters that are important to our business and stakeholders, including our customers, employees, shareholders, business partners, and the communities in which we operate. We are committeddedicated to operating our business with integrity, focusingintegrity; being responsible fiscal and environmental stewards; maintaining a diverse, inclusive, and caring culture with an emphasis on employee safety, development, and wellbeing; and having strong corporate governance practices that foster principled actions, informed and effective decision-making, appropriate monitoring of our compliance and performance, and accountability. To that end, our Board of Directors has direct oversight of our ESG strategy and its implementation.

We believe Hurco’s approach in addressing ESG matters should be thoughtful, proactive, practical, and risk-based – with priority given to ESG issues that impactare both material to our customers,business and otherwise aligned with our corporate strategies. Through our business activities, we want to be economically successful and create value for society. In that regard, Hurco will strive to evaluate and respond to ESG issues in a manner that is intended to create long-term value both for our stakeholders and for our business. More specifically, we will aim to focus on ESG initiatives that we believe are the industries we serve, our employees,most impactful to both and our shareholders, contributingthat will make Hurco a better company.

Our Board has direct oversight over ESG matters pertaining to the local communities in which we operate, developing our employees and workforce, and being considerate environmental and fiscal stewards. Our Board provides oversight of the Company’s ESG programs, initiatives, and policies.Company. In addition, the charterCharter of the Nominating and Governance Committee specifically tasksrequires that committee withto periodically reviewing our ESGreview the Company’s environmental, social, and sustainability programs, initiatives, and policies, and makingsuch committee may make recommendations to the Board and/or our management regarding the same, –to the extent the committee determines such recommendations are justified, in each case after consideringtaking into account the interests of all Companyof the Company’s stakeholders, including shareholders. A copy of the charter of the Nominating and Governance Committee is available on our website at www.hurco.com/investors under “Corporate Governance.”

We also believe that all companies have a responsibility to respect human rights. In recognition of the foregoing, our Board has adopted a Human Rights Policy representing the Company’s public expression of (1) its commitment to respect internationally recognized fundamental human rights standards and (2) its belief that all human beings should be treated with dignity, fairness, and respect. A copy of the Company’s Human Rights Policy is available at our website at www.hurco.com/investors under “Corporate Governance.”

Through our Supplier Code of Conduct, we communicate our expectation that our suppliers, vendors, and other supply chain partners adhere to certain standards related to corporate integrity, fair and ethical business practices, responsible product sourcing, and the safety and wellbeing of workers across our global supply chain. A copy of our Supplier Code of Conduct is also available on our website at www.hurco.com/investors under “Corporate Governance.”

Below are just a few representative examples demonstrating ourHurco’s commitment to ESG matters:

	Performance Categories	Objectives
Sonja K. McClelland	Strategic Initiatives/ Profit Improvement	Execute 20202022 business plan sales and production.
	Asset Management/Profit Improvement/Cost Reduction	Execute the annual business plan initiatives for profitability and return on corporate assetsassets. Execute 2022 targeted return on invested capital and total shareholder return.
	Strategic Initiatives/Liquidity and Capital Allocation	ExecuteEvaluate capital allocation strategies and liquidity structurepriorities, including: capital expenditures, M&A, dividends, and stock repurchases. Evaluate funding of strategic growth initiatives, including: sources and uses of cashflows, cost of capital, return on investment, and short-term and long-term financing options.
	Cost Reduction/Profit Improvement Corporate Governance/Sustainability Initiatives	Assess cost reductionEvaluate sustainability initiatives, including: assess financial and process for implementationoperational reporting metrics; and evaluate policies and disclosures.
	Strategic Initiatives/Market Share/Product Development	Evaluate acquisition opportunities (domestic and foreign) to accelerate growth of geographic market share and/or product development.
Gregory S. Volovic HaiQuynh Jamison	Strategic Initiatives/ Market Share ERP Systems Management	ERP system update: Assist international operations/personnel to assess and develop a multi-year plan for global systems upgrade.
	Succession Planning/Leadership Development	Corporate finance training and development: Assist in the evaluation and development of the global finance team to ensure successful transition and promotion of talent in key roles.
	Corporate Governance/Financial Reporting/Compliance	Assess and implement management and organizationalnecessary changes to increase market sharesimplify/ streamline financial reporting processes, systems, and consolidation of newly-acquired entitiesinformation.   Assess and implement necessary changes as required to comply with changes in regulatory and statutory requirements for financial reporting and disclosures.
	Strategic Initiatives/ Profit Improvement Corporate Governance/Sustainability Initiatives	Expand/Improve worldwide salesEvaluate sustainability initiatives, including: assess financial and manufacturing operations
	Research & Development	Commercialize automationoperational reporting metrics; and robotics capabilities; develop new software featuresevaluate policies and new machine tool productsdisclosures.
Strategic Initiatives/Market Share/Product Development	Evaluate acquisition opportunities (domestic and foreign) to accelerate growth of geographic market share and/or product development.
Jonathon D. Wright	Strategic Initiatives/Cost Reduction/Profit Improvement/Corporate Structure	Evaluate legal and other corporate governance service providers; revise and/or negotiate alternative fee structure to manage program cost. Evaluate global corporate and legal entity structuring.
	Strategic Initiatives/Risk Management	Implement business unit and/or global policies to support risk management and compliance programs and assess brokers, consultants and service providers.
	Corporate Governance/Sustainability Initiatives	IdentifyEvaluate ESG initiatives and pursue next generation machine tool designsimplement ESG strategy. Increase public ESG disclosure, evaluate reporting standards, and advanced control platformimplement data collection controls for future generationESG initiatives.
	Strategic Initiatives/Market Share/Product Development	Evaluate acquisition opportunities (domestic and foreign) to accelerate growth of geographic market share and/or product releasedevelopment

In January 2020,2022, the Committee also established the target percentage by which the base salary of each named executive officer paid during fiscal 2020year 2022 would be multiplied in order to determine the dollar amount that would be multiplied by the weighted-average percentage payout level applicable to each named executive officer following determination of such based on actual performance. The target amount for each named executive officer is set forth below:

On January 5, 2021,3, 2023, the Committee determined the degree to which the operating income margin metric and the strategic objectives for fiscal 2020year 2022 were attained, and the resulting payout level relative to the target amount for each metric. For fiscal 2020,year 2022, the Company reported anachieved a 5.1% operating lossincome margin and, therefore, the Committee determined that the resulting percentage payout level relative to the target amount for that metric would be 0%was 85.0%. In determining the potential payout level associated with the above strategic objectives set for fiscal 2020year 2022 for each of the named executive officers, the Committee assessed the level of achievement of those strategic objectives. As a result, the Committee determined that even though the named executive officers achieved many of the strategic objectives and additional objectives set mid-year in light of the COVID-19 pandemic, the resulting percentage payout level relative to the target amount for the strategic objectives was 0%was: for Mr. Volovic – 100%; for Mr. Doar – 100%; for Ms. McClelland – 100%; for Ms. Jamison – 100%; and for Mr. Volovic, because payouts were not permitted under the 2020 short-term incentive compensation when the operating income margin was less than zero.Wright – 200%.

The weightings applicable to each of the operating income margin metric and the 20202022 strategic objectives metric set forth above for each named executive officer wouldwere then have been applied to the percentage payout level for each metric as determined by the Committee, resulting in a weighted-averageweighted- average percentage payout level relative to the target amount for each such executive. However, as described above,The weighted- average percentage payout level applicable to each named executive officer was then multiplied by his or her target amount of fiscal year 2022 base salary listed above.

The Committee retained the Committee had provideddiscretion to adjust downward, but not upward, the amount of the compensation that if the fiscal 2020 operating income margin was zero or negative, then no amounts would otherwise be paidpayable under the 20202022 short-term incentive arrangement, even if all or a portion ofcompensation arrangement. The Committee did not exercise that discretion with respect to the performance goalsamounts payable under the strategic objectives component were attained. As a result, the Committee determined that the fiscal 20202022 short-term incentive arrangement prohibited payments to the named executive officers, since the fiscal 2020 operating income margin was negative.compensation arrangement.

The following table sets forth the total short-term incentive compensation amounts awarded to each named executive officer related to fiscal 2020:year 2022:

Long-Term Incentive Compensation.

Earned PSU Awards for Fiscal 2018-2020. Years 2020-2022.On January 5, 2021,3, 2023, the Committee also determined the degree to which the long-term incentive compensation arrangement approved for the fiscal 2018-2020years 2020-2022 performance period was attained, and the resulting payout level relative to the target amount for each metric.

The performance and payout standards for the PSUs – TSR for the fiscal 2018-2020years 2020-2022 performance period that were established by the Committee in 2018 were the same as those established and described below for the PSUs – TSR for the fiscal 2020-2022 performance period. For fiscal years 2018 through 2020 the Company’s total shareholder return performance over the three-year period of (28.5%) is positioned below the 30^th percentile TSR of (19.9%), relative to the total shareholder return of the companies in our 2018 peer group. As such and based on the applicable performance and payout standards noted below, the Committee determined that the resulting percentage payout level relative to the target amount for the fiscal 2018-2020 PSUs – TSR was 0%.

The performance and payout standards for the PSUs – ROIC for the fiscal 2018-2020 performance period that were established by the Committee in 2018 are set forth immediately below.below:

Awards will be interpolated for results between 7%the 30^th and 9%55^th percentiles and 9%the 55^th and 13%90^th percentiles

As calculated under our 2018 long-term incentive compensation arrangement,For fiscal years 2020 through 2022, the Company’s average ROIC for fiscal years 2018 throughTSR performance over the three-year period of (21.9%) is positioned between the 30th percentile TSR of (27.4%) and the 55^th percentile TSR of (0.3%), relative to the TSR of the companies in our 2020 was 5.1%.peer group. As such and based on the applicable performance and payout standards noted above, the Committee determined that the resulting interpolated percentage payout level relative to the target amount for the fiscal 2018-2020years 2020- 2022 PSUs – TSR was 60.1%.

The performance and payout standards for the PSUs – ROIC for the fiscal years 2020-2022 performance period that were established by the Committee in 2020 are set forth immediately below.

Awards will be interpolated for results between 7% and 8% and 8% and 13%

As calculated under our 2020 long-term incentive compensation arrangement, the Company’s average ROIC for fiscal years 2020 through 2022 was 1.4%. As such and based on the applicable performance and payout standards previously noted, the Committee determined that the resulting percentage payout level relative to the target amount for the fiscal years 2020-2022 PSUs – ROIC was 0%.zero.

Based on these determinations, nothe Committee approved the following number of PSUs were earned and vested pursuant to the long-term incentive compensation plan for each named executive officer, related toexcept Ms. Jamison and Mr. Wright, who did not hold any PSUs with the fiscal 2018-2020 PSUs. The following table sets forth the target number of 2018-2020 PSUs and related grant date fair value:years 2020-2022 performance period:

(footnotes on following page)

Because Ms. Jamison and Mr. Wright were not executive officers in January 2020 when the PSUs described above were granted to our executive officers, they did not receive such grants. However, Ms. Jamison and Mr. Wright each received 559 restricted shares in November 2019 as part of the fiscal year 2020 annual equity grants to key employees, which restricted shares vest in thirds on each of the three anniversaries of the date of grant.

Restricted Share and PSU Awards for Fiscal 2020-2022.Years 2022-2024.On January 2, 2020,4, 2022, the Committee approved a long-term incentive compensation arrangement for the named executive officers in the form of restricted shares and PSUs awarded under the Hurco Companies, Inc. 2016 Equity Incentive Plan (the(as amended, the “2016 Plan”).The. The awards were weighted as approximately 25% time-based vesting (in equal installments over three years) and approximately 75% performance-based vesting (at the end of a three-year period, to the extent certain performance metrics or criteria are satisfied). The three-year performance period for those awards is fiscal 2020years 2022 through fiscal 2022.2024.

The Committee granted the awards of restricted shares and target number of PSUs to the named executive officers effective as of January 2, 2020,4, 2022, as follows:

The PSUs designated as “PSUs – TSR” were weighted as approximately 40% of the overall long-termlong- term incentive compensation arrangement and will vest and be paid based on our total shareholder returnTSR over the three-yearthree- year period, relative to the total shareholder returnTSR over that period of the companies in our peer group. The companies comprising the peer group for the purposes of this award are the same as the companies comprising the peer group utilized for fiscal 2020 executive compensation determinations describedset forth below under “The Committee’s Processes and Analyses – Use of Peer Group Data.” Participants will have the ability to earn between 50% of the target number of PSUs for achieving threshold performance and 200% of the target number of PSUs for achieving maximum performance. The performance and payout standards for the PSUs – TSR are as follows:

Awards will be interpolated for results between the 30^th and 55^th percentiles and the 55^th and 90^th percentiles

The PSUs designated as “PSUs – ROIC” were weighted as approximately 35% of the overall long-termlong- term incentive compensation arrangement and will vest and be paid based on the achievement of pre-established goals related to our average ROIC over the three-year period. Average ROIC may be hereafter adjusted by the Committee to exclude the effects of unanticipated material transactions or events such as acquisitions, divestitures, accounting changes, restructurings, and special charges or gains (determined according to objective criteriapre- established by the Committee), but only to the extent permitted by Internal Revenue Code Section 162(m), if applicable. Participants will have the ability to earn between 50% of the target number of PSUs for achieving threshold performance and 200% of the target number of PSUs for achieving maximum performance. The performance and payout standards for the PSUs – ROIC are as follows:

Awards will be interpolated for results between 6% and 8% and 8% and 12%

In reaching its decision to reduce the ROIC threshold, target, and maximum performance levels from those used in recent years (7%, 9% and 13%, respectively), the Committee considered a number of factors, including, among others: (1) the impact of recent acquisitions on the overall product portfolio and strategy of the Company, including entry into more price-competitive and lower-margin product and/or brand categories; (2) the historical experience that the ROIC targets, even during periods of record revenue and satisfactory tenure, may be too high to accomplish the compensation program’s objectives; (3) the disproportionate impact a year with low or negative ROIC can have on the average over a three-year performance period, particularly in a highly-cyclical industry or market; (4) recruitment and retention of a skilled and experienced management team; and (5) the review of other market practices and peer group information in the executive compensation context.

Compensation Decisions for Fiscal 2021

Base Salaries. On November 12, 2020, employing the methodology described above under “Elements of Compensation,” the Committee established annual base salaries for the named executive officers for fiscal 2020, to become effective January 1, 2021. In light of the difficult business macroenvironment resulting from the COVID-19 pandemic, and at the recommendation of the named executive officers, the Committee determined not to implement base salary increases for the named executive officers and rather maintained their current fiscal 2020 base salaries.

The following table sets forth the annual base salary of each of the named executive officers for 2020 and the annual base salary established by the Committee for each of those officers for 2021, as well as the percentage increase between the two years:

Short-Term Incentive Compensation. On January 5, 2021, pursuant to the Cash Incentive Plan, the Committee approved the short-term incentive compensation arrangement for fiscal 2021, with payout to occur thereunder in January 2022, if and to the extent the performance goals are attained during fiscal 2021. Similar to fiscal 2020, the Committee selected operating income margin and certain strategic objectives for the named executive officers as the performance measures, which are among the performance measures set forth in the Cash Incentive Plan. While the Committee decided to maintain the performance measures for the short-term incentive compensation arrangement, the Committee also reassessed the required performance levels for operating income margin that it established for fiscal 2021. Many factors are considered when these levels are set, including the short and long-term strategic plan objectives that weight the importance of factors such as acquisitions, research and development of new products, market penetration into new and sometimes price-competitive markets, diversification of products to include entry-level, mid-range, and premium products, and continued growth of the existing markets and product lines - all of which can significantly impact the level of operating income the Company achieves from year to year.

Following the end of fiscal 2021, the Committee will determine the degree to which the operating income margin goal and the strategic objectives were attained, and the resulting payout level relative to the target amount for each metric. The Committee retains the discretion to adjust downward, but not upward, the amount of compensation that would otherwise be payable under the 2021 short-term incentive compensation arrangement.

Long-Term Incentive Compensation. Similar to the 2021 short-term incentive compensation arrangement, the Committee selected the same performance metrics for the fiscal 2021 long-term incentive compensation arrangements, as compared to fiscal 2020 (i.e., relative TSR and ROIC). Therefore, effective January 5, 2021, the Committee granted the awards below of restricted shares and target number of PSUs to the named executive officers. The restricted shares will vest in equal installments over three years and the three-year performance period for the PSUs will be fiscal 2021 through fiscal 2023.

The PSUs designated as “PSUs – TSR” were weighted as approximately 40% of the overall long-term incentive compensation arrangement and will vest and be paid based on our total shareholder return over the three-year period, relative to the total shareholder return over that period of the companies in our peer group.

The companies comprising the peer group for the purposes of this award are the companies comprising the 2021 peer group described below under “The Committee’s Processes and Analyses – Use of Peer Group Data.” The performance and payout standards for the PSUs – TSR are as follows:

Awards will be interpolated for results between the 30^th and 55^th and 55^th and 90^th percentiles

The PSUs designated as “PSUs – ROIC” were weighted as approximately 35% of the overall long-term incentive compensation arrangement and will vest and be paid based on the achievement of pre-established goals related to our average ROIC over the three-year period. Average ROIC may be hereafter adjusted by the Committee to exclude the effects of unanticipated material transactions or events such as acquisitions, divestitures, accounting changes, restructurings, and special charges or gains (determined according to objective criteria established by the Committee). Participants will have the ability to earn between 50% of the target number of PSUs for achieving threshold performance and 200% of the target number of PSUs for achieving maximum performance. The performance and payout standards for the PSUs – ROIC are as follows:

Awards will be interpolated for results between 4% and 6% and 6% and 12%

From time to time, the Committee reassesses the threshold, target, and maximum performance levels relating to newly-granted performance-based awards, considering a number of factors, including, among others: (1) the impact of recent acquisitions on the overall product portfolio and strategy of the Company, including entry into more price-competitive and lower-margin product and/or brand categories; (2) whether historical experience or payout levels indicate that the previously established threshold, target, or maximum payout levels may have been too high or too low to accomplish the compensation program’s objectives; (3) the disproportionate impact a year with low or negative financial performance can have on the average over a three-year performance period, particularly in a highly-cyclical industry or market and in light of COVID-19’s impact on the Company’s business; (4) recruitment and retention of a skilled and experienced management team; (5) the review of other market practices and peer group information in the executive compensation context; and (6) an assessment of other macroeconomic factors and indicators with a high probability of impacting our business. Based on the factors described above, and as described in our Proxy Statement for our 2022 Annual Meeting of Shareholders, in January 2021, the Committee determined to reduce the threshold and target levels for PSUs – ROIC subject to a performance period of fiscal years 2021-2023 from 6% and 8%, to 4% and 6%, respectively. In doing so, the Committee determined that an appropriate adjustment should be made to reflect the fact that it would likely take some period of time for our business to normalize after experiencing significant impact from the COVID-19 pandemic and that any interim normalization period would present a significant drag on one-year performance and a three-year ROIC average. The Committee also considered the Company’s strategic plan and the importance of incentivizing a senior executive team during performance periods containing interim periods with a challenging business environment. However, the Committee decided to retain the maximum performance payout level for the above-referenced PSUs – ROIC awards at 12%, to both incentivize significant and quick improvement in the Company’s return on invested capital metrics and to manage program costs in the event business conditions normalized more quickly than anticipated. In January 2022, the Committee reconsidered these factors, and based upon the continuance of many of them, determined to maintain the threshold and target levels for PSUs – ROIC subject to a performance period of fiscal years 2022-2024 at 4% and 6%, respectively, and also to maintain the maximum level at 12%.

Compensation Decisions for Fiscal Year 2023

Base Salaries. On November 9, 2022, employing the methodology described above under “Elements of Compensation,” the Committee established annual base salaries for all of our named executive officers for fiscal year 2023, to become effective January 1, 2023. The salary increases for Ms. Jamison of approximately 5% and for Mr. Wright of approximately 14% were intended to bring their salaries more in line with market competitive ranges for their respective roles and responsibilities. The salary increases for Mr. Volovic of 4% and for Ms. McClelland of 3% were generally in line with the average merit increase received by all U.S.-based Company employees. The salary decrease for Mr. Doar was approximately 4% and was intended to bring his base salary more in line with a market competitive range for his role as Executive Chairman.

The following table sets forth the annual base salary of each of the named executive officers for 2022 and the annual base salary established by the Committee for each of those officers for 2023, as well as the percentage change between the two years:

Short-Term Incentive Compensation. On January 3, 2023, pursuant to the Cash Incentive Plan, the Committee approved the short-term incentive compensation arrangement for fiscal year 2023 for all named executive officers, with payout to occur thereunder in January 2024, if and to the extent the performance goals are attained during fiscal year 2023. Similar to fiscal year 2022, the Committee selected operating income margin and certain strategic objectives for the named executive officers as the performance measures, which are among the performance measures set forth in the Cash Incentive Plan. While the Committee decided to maintain the performance measures for the short- term incentive compensation arrangement, the Committee also reassessed the required performance levels for operating income margin that it established for fiscal year 2023.

Following the end of fiscal year 2023, the Committee will determine the degree to which the operating income margin goal and the strategic objectives were attained, and the resulting payout level relative to the target amount for each metric. The Committee retains the discretion to adjust downward, but not upward, the amount of compensation that would otherwise be payable under the 2023 short-term incentive compensation arrangement.

Long-Term Incentive Compensation. On January 3, 2023, employing the methodology described above under “Elements of Compensation,” the Committee also determined the amount, terms, and conditions of the long-term incentive compensation arrangement for the named executive officers for the performance period of fiscal years 2023-2025. Although the Committee retained the overall general allocation of award value between restricted shares (targeted at approximately 25% of long- term incentive compensation award value) and PSUs (targeted at approximately 75% of long-term incentive compensation award value), the Committee decided to tie the vesting and earning of the PSUs to the performance measures of net income (“PSUs – NI”) and free cash flow (“PSUs – FCF”), which are among the performance measures permitted by the 2016 Plan.

In reaching its decision to select net income and free cash flow as the performance measures under the long-term incentive compensation arrangement for the performance period of fiscal years 2023- 2025, the Committee considered a number of factors, including, among others, that: (1) net income remains a powerful, yet simple, metric of company profitability by concentrating crucial information into a single number; (2) net income for public companies is readily available through many third- party intermediary sources, which facilitates accountability by allowing investors to compare investments across sectors and industries and against alternative investments among peers; (3) as a measure of profitability, assuming appropriate thresholds are set, net income performance measures would generally avoid vesting and payment of awards in periods of sustained company unprofitability; (4) free cash flow may provide insight into how financially capable a company is at having quick access to cash in case of unexpected debts or obligations, which is particularly important to companies operating in cyclical industries like ours; (5) net income and free cash flow both align with our balanced approach to capital allocation strategy of prioritizing a strong balance sheet and liquidity position while recognizing the importance of accretive growth and returning value to shareholders through dividends and stock repurchases when appropriate; and (6) net income and free cash flow remain among some of the most popular performance measures for public company executive compensation arrangements and, therefore, are likely in line with market and shareholder expectations. For all these reasons, the Committee believes that net income and free cash flow appropriately align executive compensation with Company and individual performance.

In reaching its decision to move away from relative TSR and average ROIC, the Committee considered a number of factors, including among others, that: (1) profit margin and profitability are already sufficiently taken into consideration by virtue of the operating income margin performance measure under the fiscal year 2023 short-term incentive arrangement and the net income performance measure under the new 2023 long-term incentive compensation arrangement; and (2) relative TSR has inherent limitations when representative peer groups are difficult to establish and maintain due to the following: (a) our position as a small or mid-cap industrial company results in few options for comparably sized peers; (b) our significant geographic footprint and contributions from international business are less applicable to many other small or mid-cap industrial companies; (c) our non- calendar fiscal year-end could distort relative share performance due to natural seasonality in capital markets and/or other timing differences among the peer group and normally-recurring earnings announcements; (d) the additional inherent relative business cyclicality in a business focused on capital goods specifically, rather than industrials, more generally; and (e) the frequent disqualification of peers due to business combination transactions or other external factors or forces. For these reasons and others, the Committee believes it was an appropriate time to consider alternative performance measures under its 2023 long-term incentive compensation arrangement that might better focus executive compensation with Company and individual performance.

Therefore, effective January 3, 2023, the Committee granted the awards below of restricted shares and target number of PSUs to each of the named executive officers. The restricted shares will vest in equal installments over three years and the three-year performance period for the PSUs will be fiscal years 2023 through 2025.

The PSUs designated as “PSUs – NI” were weighted as approximately 40% of the overall long-term incentive compensation arrangement and will vest and be paid based on our average net income for the performance period, relative to pre-established threshold, target, and maximum payout levels. Participants will have the ability to earn between 50% of the target number of shares for achieving threshold performance and 200% of the target number of shares for achieving maximum performance.

From time to time, the Committee reassesses the threshold, target, and maximum performance levels for ROIC that the Committee establishes for a three-year performance period. Many factors are considered when these levels are set, including long-term strategic plan objectives that weight the importance of factors such

The PSUs designated as acquisitions, research and development of new products, market penetration into new and sometimes price-competitive markets, diversification of products to include entry-level, mid-range, and premium products, continued growth“PSUs – FCF” were weighted as approximately 35% of the existing marketsoverall long- term incentive compensation arrangement and product lines, anticipated business macroenvironmentwill vest and be paid based on the achievement of pre- established goals related to our average free cash flow over the three-year period. Free cash flow for certain portions ofany fiscal year in the performance period withis defined as cash flow from operating activities (as reported in our audited financial statements for the probabilityperiod in question), minus capital expenditures (including software capitalization, since it represents a normal, recurring feature of significantly impacting overall capital marketour business). Participants will have the ability to earn between 50% of the target number of shares for achieving threshold performance and business conditions - all200% of which can significantly impact the leveltarget number of ROIC the Company achieves over a three year period.shares for achieving maximum performance.

The Committee’s Processes and Analyses

Role of Committee and Input from Management.The Committee is responsible for determining our executive compensation philosophy, objectives, policies, and programs and approves or ratifies all compensation-related decisions for the named executive officers. When making executive compensation decisions, the Committee considers the input of Pay Governance and, for all executives other than our CEO and our Executive Chairman, the recommendation of our CEO. Our CEO recommends salary levels, short-term incentive compensation awards, equity-based compensation awards, and perquisites for our other named executive officers.officers other than the Executive Chairman. Our CEO’s and Executive Chairman’s compensation isare determined solely by the Committee with the assistance of Pay Governance. The Compensation Committee applies the same principles for executive compensation in determining our CEO’s and Executive Chairman’s compensation that it applies in determining the compensation of our other named executive officers.

Role of Compensation Consultant.In 20192021 and 2020,2022, the Committee engaged Pay Governance to advise and assist the Committee related to executive compensation matters. Pay Governance is retained directly by the Committee, reports directly to the Committee, and participates in certain Committee meetings. In this regard, from time to time, Pay Governance advises and assists the Compensation Committee:

Pay Governance may, from time to time, contact our executive officers for information necessary to fulfill its assignment and may make reports and presentations to and on behalf of the Committee that our executive officers also receive.

Pay Governance and its affiliates did not provide any other services to us or our affiliates during 20192021 or 2020.2022. In addition, the Committee has determined that the work of Pay Governance and its employees has not raised any conflict of interest.

Use of Peer Group Data.With the assistance of Pay Governance, in 20192021 and 2020,2022, the Committee approved the composition of a peer group of publicly-traded companies that were selected on the basis of industry, revenue, global operations, employee size, and market capitalization for use in the Committee’s 20202022 fiscal year and 20212023 fiscal year analyses of executive compensation.

The following companies made up the peer group utilized for fiscal 2020year 2022 executive compensation determinations:

The following companies makemade up the peer group utilized for fiscal 2021year 2023 executive compensation determinations:

The Committee uses the peer group data as one of several inputs when making compensation determinations. Periodically, the Committee also reviews trends data for the manufacturing industry from Willis Towers Watson to obtain a general understanding of current compensation practices in that industry as part of its analysis of executive compensation. In addition to the market data, the Committee may consider other factors such as an executive’s individual performance, experience in his or her position, and responsibilities that may not necessarily be benchmarked in market data.

Recoupment Policy

Our Corporate Governance Principles contain a compensation recoupment policy. Our Corporate Governance Principles are available on our website at www.hurco.com/investorsunder “Corporate Governance.” The recoupment policy provides that in the event that the Company restates previously released financial results, the Compensation Committee shall determine whether any incentive compensation (defined as all equity-based and non-equity based compensation, the amount, payment and/or vesting of which was determined based wholly or in part on the value of the Company’s financial results or the achievement of specified performance measures) paid or awarded to executive officers during the three years preceding the restatement should be recovered by the Company. If the Committee determines that the amount of any incentive compensation paid to executive officers (the “Awarded Compensation”) during the three-year period preceding the date of restatement exceeded the amount that would have been paid based on the restated financial results (the “Adjusted Compensation”), and the restatement resulted from the Company’s material noncompliance, due in whole or part to intentional fraud or ethical misconduct, with any financial reporting requirement under the federal securities laws, then the Committee shall determine whether the Company should, except as provided below, recover the after-tax portion of the difference between the Awarded Compensation and the Adjusted Compensation for the affected executive officer.

In making the determination whether the Company should recover any incentive compensation, the Committee will take any appropriate considerations into account, including the role the executive officer played in contributing to the events that caused the restatement, the likelihood of success in recovering the amounts under applicable law, the costs of seeking recovery, and whether the assertion of a claim may prejudice the interests of the Company in any related proceeding or investigation relating to the circumstances giving rise to the restatement.

In addition,The SEC recently adopted final rules under the Compensation Committee is monitoring regulatory developments with respectDodd-Frank Act directing national securities exchanges to establish listing standards requiring listed companies to adopt compensation recoupment policies andcontaining certain provisions. The Committee will recommendconsider appropriate modifications to the Board any changesCompany’s recoupment policy to comply with the current policy thatnew rules and listing standards once they are necessary or appropriate in light of future SEC guidance.finalized.

Tax Considerations

Section 409A of the Internal Revenue Code affects the payments of certain types of deferred compensation to key employees and includes requirements relating to when payments under such arrangements can be made, acceleration of benefits, and timing of elections under such arrangements. Failure to satisfy these requirements will generally lead to an acceleration of the timing for including deferred compensation in an employee’s income, as well as certain penalties and interest. Our nonqualified deferred compensation arrangements are intended to comply with the effective requirements of Section 409A as required by law or regulation.

Report of the Compensation Committee

The information contained in this report shall not be deemed to be “soliciting material,” to be “filed” with the SEC, or to be subject to Regulation 14A or Regulation 14C (other than as provided in Item 407 of Regulation S-K) or to the liabilities of Section 18 of the Exchange Act, and shall not be deemed to be incorporated by reference in future filings with the SEC except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933, as amended, or the Securities Act, or the Exchange Act.

The Committee has reviewed and discussed the foregoing Compensation Discussion and Analysis with management. Based on that review and those discussions, the Committee recommended to the Board of Directors that this Compensation Discussion and Analysis be included in this proxy statement on Schedule 14A and incorporated by reference in the Company’s Annual Report on Form 10-K for its 20202022 fiscal year.

Assessment of Compensation-Related Risks

On an ongoing basis as part of our strategic business planning process, the named executive officers and key senior management conduct an assessment of the current risks arising from our compensation policies and practices. This team reviews and discusses the characteristics and approval policies of compensation programs for all employees, including salaries, equity awards, and cash bonuses, to determine whether any of these policies or programs could create risks that are reasonably likely to have a material adverse effect on us.

In November 2020,2022, we reviewed and discussed all components of our compensation policies and practices with our Board as part of our business plan review and approval process. In addition, the Compensation Committee met separately to review the management team’s assessment of the risks that could arise from our compensation policies and practices. As part of their review, the Compensation Committee specifically considered factors that reduce the likelihood of excessive risk-taking,risk- taking, such as our overall compensation levels being competitive with the market, the balance between fixed components like salary and benefits, and short and long-term incentive compensation. The Committee has discretion to adjust downward the amount of compensation that would otherwise be payable under the short-term incentive compensation program, which it could do if it determines that an executive caused the Company to incur unnecessary or excessive risk. The compensation mix of cash (salary and short-term incentive) and equity incentives align with the market and the Company’s peers and are linked to business performance. The short-term and long-term incentive plans are linked to specific formulas and have payout ceilings. The 2020fiscal years 2022 and 2021 short-term2023 short- term incentive compensation arrangements also provide that no amounts will be paid under the strategic objectives component if our operating income margin is zero or negative. Our stock ownership guidelines link executives’ and non-employee directors’ interests to the interests of shareholders, and our incentive compensation recoupment policy would permit us to recover certain incentive compensation paid to executive officers in the event of wrongdoing on the part of the executives.

Based on such assessments, we believe that any risks arising from our compensation policies and practices are not reasonably likely to have a material adverse effect on us.

Tabular Compensation Information

The following table summarizes the compensation information for each of our named executive officers for each of the fiscal years ended October 31, 2020, 2019,2022, 2021, and 2018:2020:

SUMMARY COMPENSATION TABLE