☐ (Name of Registrant as specified in its charter)ooooo o☐ o☐ o☐
This Proxy Statement and the form of proxy are furnished to the shareholders of Astronics Corporation, a New York corporation (“Astronics” or the “Company”), in connection with the solicitation of proxies by the Board of Directors of the Company for use at the Annual Meeting of Shareholders (the “Annual Meeting”) to be held on Thursday,Monday, May 30, 2019,23, 2022, at Astronics ConnectivityLuminescent Systems, & Certification Corp. locatedInc. at 804 S. Northpoint Blvd., Waukegan, Illinois 600854 Lucent Drive, Lebanon, New Hampshire 03766, USA at 10:00 a.m. CentralEastern Time and at any adjournment thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders. In addition to solicitation by mail, to the extent necessary to ensure sufficient representation at the Annual Meeting, solicitations may be made by personal interview or telecommunication by officers and other regular employees of the Company. The cost of this proxy solicitation will be borne by the Company. It is contemplated that the Notice Regarding the Availability of Proxy Materials will be first sent to shareholders on or about April 17, 2019.
11, 2022.
If the proxy is properly executed and returned, and the shareholder specifies a choice on the proxy, the shares represented thereby will be voted (or withheld from voting) in accordance with the instructions contained therein. If the proxy is executed and returned but no specification is made, the proxy will be voted (i) FOR the election of each of the nominees for director listed below, and (ii) FOR the proposal to ratify the appointment of the independent auditors.registered public accounting firm. The Board of Directors of the Company knows of no business that will be presented for consideration at the Annual Meeting other than the matters described in this proxy statement. If any other matters are properly presented at the Annual Meeting, the proxy holders will vote the proxies in accordance with their judgment.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed the close of business on Wednesday, April 10, 2019 as the record date for determining the holders of Astronics Common Stock (“Common Stock”) and Astronics Class B Common Stock (“Class B Stock”) entitled to notice of and to vote at the Annual Meeting. On April 10, 2019, Astronics Corporation had outstanding and entitled to vote at the meeting a total of 24,529,479 shares of Common Stock and 8,122,382 shares of Class B Stock. Each outstanding share of Common Stock is entitled to one vote and each outstanding share of Class B Stock is entitled to 10 votes on all matters to be brought before the meeting. The Common Stock and Class B Stock vote as a single class on all matters presented at the meeting.
VOTING SECURITIES
In order for business to be conducted, a quorum must be present at the Annual Meeting. A quorum is a majority of the outstanding shares of Common Stock and Class B Stock combined entitled to vote at the Annual Meeting. Abstentions, broker non-votes and withheld votes will be counted in determining the existence of a quorum at the Annual Meeting.
Directors will be elected by a plurality of the votes cast at the Annual Meeting, meaning the eight nominees receiving the
most votes will be elected. Votes cast FOR the nominees will count as “yes votes” and WITHHOLD votes will be excluded entirely from the vote and will have no effect. A majority of the votes cast is required to approve the selection of the Company’s auditors. Votes may be cast FOR, AGAINST or ABSTAIN on the approval of this proposal.these proposals. Abstentions are not counted in the number of votes cast and will have no
effect on the results of the vote. Proxy cards that are executed and returned without any designated voting direction will be voted in the manner stated on the proxy card.
Brokers may not vote your shares on any non-routine matter in the absence of specific voting instructions from you. Please contact your broker directly if you have questions about how to provide such instructions. instructions. The execution of a proxy will not affect a shareholder’s right to attend the Annual Meeting and to vote in person. A shareholder who executes a proxy may revoke it at any time before it is exercised by giving written notice to the Secretary, by appearing at the Annual Meeting and so stating, or by submitting another duly executed proxy bearing a later date.
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INFORMATION CONCERNING THE ANNUAL MEETING
What matters will be voted on at the meeting?
At the meeting, shareholders will vote on two proposals and any other business properly brought before the meeting:
Election of nominees to serve on our Board of Directors; and
Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2022.
How does the Board recommend I vote on the proposals?
The Board recommends that you vote:
FOR each of the nominees named in this proxy statement; and
FOR the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2022.
Who is entitled to vote?
The Board of Directors has fixed the close of business on Monday, April 4, 2022 as the record date for determining the holders of Astronics Common Stock (“Common Stock”) and Astronics Class B Common Stock (“Class B Stock”) entitled to notice of and to vote at the Annual Meeting.
On April 4, 2022, Astronics Corporation had outstanding and entitled to vote at the meeting a total of 25,526,440 shares of Common Stock and 6,363,204 shares of Class B Common Stock.
Each outstanding share of Common Stock is entitled to one vote and each outstanding share of Class B Stock is entitled to 10 votes on all matters to be brought before the meeting. The Common Stock and Class B Stock vote as a single class on all matters presented at the meeting.
How do I cast my vote if I am a shareholder of record?
You can cast your vote:
in person, by attending the Annual Meeting of Shareholders;
| • | via the Internet, by visiting www.proxyvote.com and following the instructions provided; or |
by mail, if you mark, sign and date the proxy card enclosed with this proxy statement and return it in the postage-paid envelope provided.
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INFORMATION CONCERNING THE ANNUAL MEETING
How do I cast my vote if I am a beneficial owner of shares held in street name?
You can cast your vote:
in person, by first obtaining a voting instruction form issued in your name from your broker and bringing that voting instruction form to the meeting, together with a copy of a brokerage statement reflecting your stock ownership as of the record date and valid identification;
| • | via the Internet, by visiting www.proxyvote.com and following the instructions provided; or |
by mail, if you mark, sign and date the voting instruction form and return it in the postage-paid envelope provided by your broker.
If I have given a proxy, can I revoke that proxy?
Your presence at the meeting will not in itself revoke any proxy you may have given. If your shares are held in your own name (i.e., you are the shareholder of record), you may revoke your proxy at any time (to the extent it has not already been voted at the meeting), but a revocation will not be effective until it is received. Your proxy will be revoked (to the extent it has not already been voted at the meeting):
| • | if you give written notice of the revocation to Astronics Corporation Corporate Secretary, Julie Davis, 130 Commerce Way, East Aurora, NY 14052 or give electronic notice to Ms. Davis at Julie.Davis@astronics.com; |
if you submit a properly signed proxy with a later date; or
by appearing at the meeting in person and stating that you revoke your proxy.
If your shares are held in street name through a broker, bank or other nominee for your benefit, you should contact that record holder to obtain instructions if you wish to revoke your vote before the meeting.
How will my proxy be voted?
If you are a registered holder and your proxy is properly executed, returned and received before the meeting and is not revoked, it will be voted in accordance with your instructions. If you return your signed proxy but do not mark the boxes to show how you wish to vote on a proposal, the shares for which you have given your proxy will, in the absence of your instructions to the contrary, be voted as follows:
Proposal 1: “FOR” the election of each of the nominees named in this proxy statement to serve on the Company’s Board of Directors;
Proposal 2: “FOR” the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2022; and
In the discretion of the proxies on other matters properly brought before the meeting.
If your shares are held in street name through a broker, bank or other nominee for your benefit and your voting instruction
form is properly executed, returned and received before the meeting and is not revoked, it will be voted in accordance with your instructions. If you have not furnished voting instructions within a specified period before the meeting, under current National Association of Securities Dealers (“NASDAQ”) rules, brokerage firms and nominees that are members of the NASDAQ may vote their customers’ unvoted shares on “routine” matters but not on non-routine matters. Under the NASDAQ rules, routine matters include the ratification of the appointment of our independent registered public accounting firm but do not include the other proposals on the ballot.
The voting instruction form also grants the proxy holders discretionary authority to vote on any other business that may properly come before the meeting as well as any procedural matters. As of the date of this proxy statement, the Company does not know of any other matters that will be presented at the meeting.
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MEETING
Who can attend the Annual Meeting?
All shareholders of Astronics Corporation who owned shares of record on April 4, 2022 may attend the meeting. If you want to vote in person and you hold Astronics Corporation common stock in street name (i.e. your shares are held in the name of a brokerage firm, bank or other nominee), you must obtain a proxy card issued in your name from your broker and bring that proxy card to the meeting, together with a copy of
a brokerage statement reflecting your stock ownership as of the record date, and valid identification. If you hold stock in street name and want to attend the meeting but not vote in person at the meeting, you must bring a copy of a brokerage statement reflecting your stock ownership as of the record date, and valid identification.
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PROXY SUMMARY
ENVIRONMENTAL, SOCIAL AND GOVERNANCE HIGHLIGHTS
ENVIRONMENT
Environmental Approach
Astronics is committed to minimizing the impact of its activities on the environment. The Company maintains a variety of formal policies and procedures related to protection of the environment, energy conservation and waste management, as well as general business practices that are part of its culture. These policies and procedures are specific to each subsidiary. In most instances, these policies and practices are embedded in Astronics’ Employee Handbook. Employees must certify – in many cases annually -- that they have read and will comply with the Employee Handbook. In fact, Astronics’ PECO facility is a Zero Liquid Discharge facility.
In addition, when considering an acquisition or partnership, the Company embeds questions specific to the environment within its due diligence approach. These include claims, policies, certifications and procedures relative to environmental management. Astronics Corporation asks these in an effort to both promote positive environmental policies and practices as well as to minimize any risk when assessing the acquisition candidate.
While Astronics Corporation does not currently track environmental metrics on a company-wide basis, the Company recognizes the value and importance of reducing its impact on the global environment.
Certifications and Training
Astronics Connectivity Systems & Certification Corp. and Astronics Advanced Electronic Systems Corp. have processes that comply with the requirements of ISO-14001, the international standard for effective environmental management.
Most of the Company’s operations maintain formal programs that establish goals and measure progress towards those goals regarding reductions and disposal of hazardous substances, recycling and minimization of power consumption, among other efforts. In those operations that are not ISO-14001 compliant, Astronics meets or exceeds all applicable environmental laws and regulations by maintaining many initiatives and practices that reduce its impact on the
environment. Some examples of such initiatives and practices include policies to reduce paper, policies to reduce single occupancy commuting, replacement of older, less-efficient lighting with energy efficient motion-based LED lighting, active waste recycling, water consumption reduction programs, and providing electric car recharging stations and bicycle storage at its largest operation.
Each subsidiary is expected to conduct both government/regulatory mandated training as well as professional development training, depending upon that subsidiary’s areas of expertise. Specific certifications may be found at each subsidiary website: https://www.astronics.com/subsidiaries.
Vendor Code of Conduct
While Astronics Corporation does not have a separate vendor code of conduct, as part of its contracts, the Company Code of Conduct requires that its vendors adhere to the spirit of its Code of Ethics (see Social/Human Capital Management). In addition, language to this effect is often included in the Terms
and Conditions portion of the Company’s contracts with suppliers and customers. When required as part of an agreement, Astronics Corporation has signed a customer’s Code of Conduct.
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PROXY SUMMARY
Supply Chain
Astronics strives to maintain the integrity of its supply chain to the best of its ability. Astronics Corporation files Form SD Conflict Minerals Disclosure to be compliant with SEC regulations and, in many instances, the Company also is
required to comply with government standards in evaluating and choosing suppliers. Each subsidiary works with its suppliers to determine if legal and regulatory requirements are met.
Conflict Minerals
Astronics will comply with all applicable conflict minerals regulations, including the US Securities and Exchange Commission’s Conflict Minerals Rule and the European Union’s Conflict Minerals Regulation.
Astronics’ Conflict Minerals Policy is to only use tin, tungsten, tantalum, or gold whose source can be traced to scrap/recycled materials or smelters and refiners that are conformant with the Responsible Minerals Initiative‘s (RMI) Responsible Minerals Assurance Process (RMAP). Astronics encourages the use of responsibly mined minerals from the Democratic Republic of the Congo and adjoining countries.
To ensure compliance with this policy, Astronics has put in place procedures that conform with the Five-Step Framework
for Risk-Based Due Diligence as described in OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas.
Astronics’ standard purchase order terms and conditions require our suppliers to adapt a conflict minerals policy similar to Astronics and to provide Astronics each year with an updated Conflict Minerals Reporting Template (CMRT), the industry-standard reporting form published by the RMI.
A copy of Astronics’ current Form SD may be found on its website at www.astronics.com/about/conflict-minerals.
SOCIAL / HUMAN CAPITAL MANAGEMENT
Human Capital Management and Corporate Culture
Astronics Corporation greatly values its employees and recognizes that, without them, the Company would not have achieved the success it has accomplished since inception. Astronics strives to provide a positive, supportive work culture with a clear global vision and a collaborative work style. The Company strongly believes that a focus on learning and supporting career development can lead to success. Astronics Corporation regularly earns “best employer” awards.
As it relates to customers, investors, suppliers and partners, the Company is dedicated to conducting business with integrity and responsibility for the greater good. Astronics Corporation promotes honest and ethical conduct, compliance with applicable government regulations and accountability by
all of its directors, officers and employees. When considering an acquisition or partnership, the Company embeds questions specific to human capital management within its due diligence approach. These questions are in the areas of culture, equal employment opportunity, compliance with governing bodies, ethics, as well as employee benefits. Astronics Corporation asks these in an effort to ensure that the acquisition candidate is a positive cultural fit and to minimize any risk when assessing the acquisition candidate.
Relative to collective bargaining agreements, the Company has hourly production employees at PECO who are subject to collective bargaining agreements. Astronics Corporation considers its relations with all of its employees to be good.
The Board’s Role
Astronics Corporation’s Corporate Governance Guidelines outline expectations that the Board establish and promote policies that encourage a positive, supportive work culture. The Board recognizes that culture is critical to the
long-term success of Astronics and its strategy. Therefore, the policies referenced herein apply to the Board as well as to relationships among and between the Board and employees.
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PROXY SUMMARY
Voice of the Employee
The lifeblood of any organization is its employee base. Astronics relies on its individual subsidiaries to regularly gather employee feedback, using the method each subsidiary believes is most appropriate. In some instances that feedback is obtained through “Town Hall” formats; in other instances
it is obtained through surveys. However the feedback is collected, the Company expects its managers to solicit and, where applicable, use employee feedback to improve its business practices and working environment.
Diversity and Inclusion
Astronics believes that diversity and inclusion is critical for the attraction and retention of top talent. The Company employs policies and procedures to recruit women and minority talent as well as policies to ensure pay equality. Astronics Corporation has an Equal Employment Opportunity Policy whereby the Company commits to providing equal employment opportunity for all qualified employees and applicants without regard to race,
color, sex, sexual orientation, gender identity, religion, national origin, disability, veteran status, age, marital status, pregnancy, genetic information or other legally protected status. This policy is posted on the Astronics Corporation website at https://www.astronics.com/docs/default-source/atro-legal/careers/equal-employment-opportunity-policy.pdf.
Certifications and Training
The Board of Directors has adopted a Code of Business Conduct and Ethics that is applicable to its Chief Executive Officer and Chief Financial Officer as well as all other directors, officers and employees of the Company. The Company will disclose any amendment to this Code of Business Conduct and Ethics or waiver of a provision of this Code of Business Conduct and Ethics, including the name of any person to whom the waiver was granted, on its website.
Further, the Company has a policy on Combatting Human Trafficking to ensure that employees, agents and suppliers of the Company do not engage in human trafficking or human trafficking activities.
The Company’s explicit statement regarding not tolerating human trafficking can be found at https://investors.astronics.com/corporate-governance/governance-documents.
Each subsidiary is expected to conduct both government/regulatory mandated training as well as professional development training, depending upon that subsidiary’s areas of expertise. The Company requires all of its employees to certify that they have read and understood the Code of Ethics. Based upon the needs of, and regulations associated with, each of the Company’s businesses, Astronics Corporation requires training for both regulatory and corporate compliance purposes.
Safety and Health
Astronics is committed to the safety of its customers and its employees. Each Astronics operation maintains environmental, health and safety policies that seek to promote the operation of its businesses in a manner that is protective of the health
and safety of the public and its employees. In fact, Astronics Luminescent Systems Inc. has received safety awards from the State of New Hampshire for working more than a year without a lost time accident.
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PROXY SUMMARY
Astronics Corporation’s operations offer several health and welfare programs to employees to promote fitness and wellness and to encourage preventative healthcare. In addition, Astronics’ employees are offered a confidential employee
assistance program that provides professional counseling to employees and their family members. Also, many of the Company’s operations offer greenspace for employees to use during their breaks.
Policies
It is Astronics’ intention to provide a safe, healthy working environment for its employees, to the extent possible. To achieve this, the Company has created the following policies,
all of which are available publicly, as indicated, some of which are internal to the organization:
| • | Code of Business Conduct and Ethics: https://www.astronics.com/about/corporate-responsibility |
| • | Statement on Human Trafficking: https://investors.astronics.com/corporate-governance/governance-documents |
| • | EEOC policy: https://www.astronics.com/docs/default-source/atro-legal/careers/equal-employment-opportunity-policy.pdf |
| • | Affirmative Action Policy: https://www.astronics.com/docs/default-source/atro-legal/careers/affirmative-action-policy.pdf?sfvrsn=5908a958_2 |
| • | Drug-free workplace statement: https://www.astronics.com/docs/default-source/atro-legal/code-of-ethics |
| • | Improper conduct/discrimination/harassment statement: https://www.astronics.com/docs/default-source/atro-legal/code-of-ethics |
| • | Health and Safety statement: https://www.astronics.com/docs/default-source/atro-legal/code-of-ethics |
| • | Whistleblower (Reporting and Effect of Violations) statement: https://www.astronics.com/docs/default-source/atro-legal/code-of-ethics |
Additional documents and policies may be found at: https://investors.astronics.com/corporate-governance/governance-documents.
Benefits
Astronics offers a generous benefits program for its employees. The Company provides a drug-free work environment and
requires drug screening of all candidates accepting employment.
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PROXY SUMMARY
Awards
Astronics Corporation is proud to have received numerous awards, recognizing both product quality as well as the Company’s ability to provide an excellent work environment.
A few of these awards include: 2021 America by Design: People’s Choice Award; 2020 Crain’s List: Chicago’s Largest Research and Development Labs; 2019 GOOD DESIGN Award; APEX 2019 Best Cabin Innovation Award; General Atomics Supplier Excellence Award (2016, 2017, 2018);
Washington’s 100 Best Companies to Work For; Tech Briefs 2017 Product of the Year; Chicago’s 101 Best and Brightest Companies to Work For; Intel Supplier Continuous Quality Improvement; 2017 and 2018 Military & Aerospace Electronics Innovators Awards-Platinum; 2018 Global Technology Award; 2014-2021 Top Workplace Award-Orange County Register (eight consecutive years) and 2021 Top Workplace Manufacturing (National).
Voice of the Customer
Customer feedback is critically important to advancing initiatives and improving service levels. To accomplish this, the Company actively seeks customer feedback on an ongoing basis, relying upon each subsidiary to engage as that business
sees fit. Customer feedback mechanisms employed by Astronics subsidiaries routinely include the use of customer “scorecards” as well as soliciting input through ongoing discussions.
Community Engagement
Astronics’ employees participate in numerous community engagement activities. Astronics supports and encourages its employees to be active and participate in local charitable activities and believes that the employee should choose to support the organization which means the most to her/him/them. The Company supports its employees at the
subsidiary level, providing them with needed time off and, at times with matching donations, to engage with the charities of their choice. Those charities have included supporting local food banks and Marine Corps Toys for Tots. For more information, please click on each of the Company’s individual subsidiaries at https://www.astronics.com/careers.
GOVERNANCE
Corporate Responsibility
Astronics Corporation is dedicated to conducting business with integrity and responsibility for the greater good. The Company promotes honest and ethical conduct, compliance with applicable government regulations and accountability by all of its directors, officers and employees. The Company’s Board has adopted Corporate Governance Guidelines and a Code of Business Conduct and Ethics which, in conjunction with Board committee charters, form the framework for its governance and is applicable to its directors and all employees. The Board regularly reviews corporate governance developments and modifies its Corporate Governance Guidelines, committee charters and key policies as warranted. The Company will disclose on its website any amendment to its Code of Business Conduct and Ethics or waiver of a provision of this Code of Business Conduct and Ethics,
including the name of any person to whom the waiver is granted. Astronics Corporation’s business is conducted by its employees, managers and officers, under the direction of the Chief Executive Officer (CEO) and the oversight of the Board, to enhance the long-term value of Astronics Corporation for its shareholders. The Board of Directors stands in a fiduciary relation to the corporation and, in discharging these fiduciary duties, Directors shall act in a manner that they reasonably believe to be in the best long-term interests of the Company, in particular, the interests of the shareholders. The Board recognizes that the interests of the Company and its shareholders are advanced when they take into account the concerns of and the effect of any action upon employees, suppliers, customers, the communities in which operations are established, and other pertinent factors.
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PROXY SUMMARY
Governance Highlights
| |  | | | Supermajority of independent directors | |
| |  | | | Independent Board Committees | |
| | | | | Annual Board member election | |
| | | | | Require double-trigger for equity acceleration upon a change in control | |
| | | | | Maintain a competitive compensation package | |
| | | | | Strong lead independent director role and responsibilities | |
| | | | | Require stock ownership for the Board of Directors | |
| | | �� | | Annual Board and Committee self-evaluations | |
| | | | | Strategy and risk oversight by full Board | |
| | | | | Board and Committees have the right to retain independent outside financial, legal or other advisors | |
| | | | | Director “overboarding” limits | |
| | | | | Regular executive sessions of independent directors | |
| | | | | CEO succession plan | |
Policies and Charters
Astronics has several policies and charters to guide the conduct and action of the Company’s employees and Board of Directors. Some of the Company’s policies contain sensitive
information and are not made public, such as our policies on Social Media and Cybersecurity. Website links for those that are available to the public follow as indicated:
Audit Committee Charter:
https://investors.astronics.com/corporate-governance/governance-documents
Compensation Committee Charter:
https://investors.astronics.com/corporate-governance/governance-documents
Nominating/Governance Committee Charter:
https://investors.astronics.com/corporate-governance/governance-documents
Corporate Governance Guidelines:
https://investors.astronics.com/corporate-governance/governance-documents
| • | Political contributions statement: https://www.astronics.com/docs/default-source/atro-legal/code-of-ethics |
Social media policy
Cybersecurity policy; compliant with NIST 800-171
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PROPOSAL 1: ELECTION OF DIRECTORS
New Board Developments
| |  | | | THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES. Nominees for Director Nominated by the Board of Directors for Terms Expiring in 2023 | |
On December 14, 2018, Mr. Mark Moran joined the Board of Directors of the Company.
On March 2, 2019, Mr. John Drenning passed away. The Board of Directors and Management of the Company are grateful for Mr. Drenning’s nearly 50 years of service on the Board of Directors.
On April 9, 2019, following Mr. Drenning’s death, the Board of Directors decreased the size of the Board from nine to eight.
Election of Directors
Our
Astronics Corporation’s By-Laws, as amended, provide that ourthe Board of Directors shall be composed of not less than three nor more than nine persons, as determined by the Board of Directors. Following the death of Mr. John Drenning,Currently, the Board of Directors decreased the size of the Board fromincludes nine to eight. The Directors aremembers, elected at each annual meetingAnnual Meeting of shareholders and towho serve for a term of one year or until their successors are duly elected and qualified.
Each of
Director Tonit M. Calaway will not stand for re-election at the Directors attended at least 75%Annual Meeting. As a result, there would be one vacancy on the Board following the Annual Meeting. However, the Nominating/ Governance Committee has recommended to the Board, and the Board has approved, a reduction in the size of the Board meetings held in 2018, except Mr. Moran who joined the Board in December 2018. With the exception of Mr. Gundermann, eachas of the nominees is independent within the meaning of the NASDAQ Stock Market, LLC director independence standards as currently in effect.
Annual Meeting from nine members to eight members.
Unless instructions to the contrary are received, it is intended that the shares represented by proxies will be voted for the election as Directors of Raymond W. Boushie, Robert T. Brady, Jeffry D. Frisby, Peter J. Gundermann, Warren C. Johnson, Kevin T.Robert S. Keane, Neil Y. Kim and Mark Moran, each of whom has been previously elected by our shareholders other than Mr. Moran.Astronics Corporation shareholders. If any of these nominees should become unavailable for election for any reason, it is intended that the shares represented by the proxies solicited herewith will be voted for such other person as the Board of Directors shall designate. The Board of Directors has no reason to believe that any of these nominees will be unable or unwilling to serve if elected to office.
The following information is provided concerning the nominees for director:
Name of Nominee | Age | Positions and Offices With Astronics | First Elected or Appointed Director |
Raymond W. Boushie | 79 | Lead Director; Compensation (Chair) and Audit Committees of the Board of Directors | 2005 |
Robert T. Brady | 78 | Director; Audit (Chair) and Compensation Committees of the Board of Directors | 1990 |
Jeffry D. Frisby | 63 | Director; Nominating/Governance (Chair) and Audit Committees of the Board of Directors | 2016 |
Peter J. Gundermann | 56 | Director, President and Chief Executive Officer of the Company | 2001 |
Warren C. Johnson | 59 | Director; Compensation and Nominating/Governance Committees of the Board of Directors | 2016 |
Kevin T. Keane | 86 | Chairman of the Board and Director | 1970 |
Neil Kim | 60 | Director; Audit and Compensation Committees of the Board of Directors | 2016 |
Mark Moran | 63 | Director; Compensation and Nominating/Governance Committees of the Board of Directors | 2018 |
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PROPOSAL 1: ELECTION OF DIRECTORS
Included in the information below are current directors and/or director nominees of the Company who are presently serving, or have served during the preceding five years, on boards of directors of other publicly traded companies.
Raymond W. Boushie, 82
Compensation (Co-Chair) and Audit Committees; Director since 2005
Experience
Raymond W. Boushie retired in 2005 as President and Chief Executive Officer at Crane Co.’s Aerospace & Electronics segment, a position he had held since 1999. Previously he was President of Crane’s Hydro-Aire operation. Mr. Boushie has a B.A. from Colgate University, and has completed graduate work at the University of Michigan and the Wharton School of Finance at the University of Pennsylvania. Mr. Boushie has over 40 years of Aerospace industry experience.
Skills and Qualifications
Mr. Boushie’s past experience as President and CEO of a leading aerospace and electronics business has provided him with extensive management experience within the same industry as Astronics Corporation. His more than 40 years in the aerospace industry provide the Company with institutional knowledge and context that is extremely valuable regarding long-term strategy. This also includes his experience as past Chairman of several important industry associations – General Managers Council, Manufacturers Alliance; General Aviation Manufacturers Association; and the Aerospace Industries Association. In addition, his financial qualifications and ongoing education make him a strong asset to the Audit Committee.
Robert T. Brady, 81
Lead Director; Audit (Chair) and Nominating/Governance Committees; Director since 1990
Experience
Robert T. Brady retired in January 2014 as the Chairman of the Board of Moog Inc., a publicly traded company that is a designer and manufacturer of high performance, motion and control systems for use in aerospace, defense, industrial and medical markets. Mr. Brady was Chief Executive Officer of Moog Inc. from 1988 to December 1, 2011, Chairman of the Board from 1996 until his retirement, and a director of Moog Inc. from 1984 until January 2014. Prior to joining Moog in 1966, Mr. Brady served as an officer in the U.S. Navy. Mr. Brady received his B.S. in Mechanical Engineering from the Massachusetts Institute of Technology and his M.B.A. from Harvard Business School.
Other Public Board Memberships
Director, M&T Bank Corporation
Skills and Qualifications
Mr. Brady’s past experience as Chairman of Moog Inc. and as director of other public companies, provides Astronics Corporation with valuable insight into governance trends and metrics. Similarly, Mr. Brady’s former experience as CEO of Moog Inc. has provided him with extensive management experience within the same industry as Astronics Corporation. His institutional knowledge of the aerospace and defense industry provides helpful context in creating the Company’s long-term strategy. In addition, his financial qualifications and ongoing education make him a strong asset to the Audit Committee.
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PROPOSAL 1: ELECTION OF DIRECTORS
Jeffry D. Frisby, 66
Director; Nominating/Governance (Chair) and Audit Committees; Director since 2016
Experience
Jeffry D. Frisby serves as the Executive Chairman of PCX Aerostructures, LLC, primarily a supplier of flight critical mechanical systems and assemblies, including rotor heads, landing gear and external fuel tanks. He was President and Chief Executive Officer of PCX Aerostructures, LLC a supplier of large structural airframe assemblies, including wing, fuselage and engine components.from April 2017 until September 2021. Previously, Mr. Frisby was Chief Executive Officer of Triumph Group, Inc., a publicly traded company that is a global leader in manufacturing and overhauling aerospace structures, systems and components, from July 2012 until April 2015, and its President from July 2009 until April 2015. Mr. Frisby served as Triumph’s Chief Operating Officer from July 2009 to July 2012. Previously, he had been Group President of Triumph Aerospace Systems Group, a group of companies that design, engineer and manufacture a wide range of proprietary and build-to-print components, assemblies and systems for the global aerospace original equipment manufacturers, from April 2003 to July 2009. He also held a variety of other positions within the Triumph Group as well as a predecessor group company, Frisby Aerospace, Inc. Mr. Frisby served as a Director of Triumph Group, Inc. from 2012 to April 2015. Mr. Frisby currently serves as a director of Quaker Chemical Corporation. Mr. Frisby holds a B.S. in Business from Wake Forest University, Calloway School of Business. Mr. Frisby has almostover 40 years of Aerospace industry experience.
Other Public Company Board Memberships
Quaker Houghton
Skills and Qualifications
Mr. Frisby brings significant aerospace experience spanning nearly 40 years, in addition to deep executive leadership, M&A and manufacturing expertise from his service as President and CEO of PCX Aerostructures as well as Triumph Group, Inc. Other skills include accounting/finance, financial reporting, industrial marketing, organizational development, global organizations, strategic planning and corporate development. Mr. Frisby brings complementary experience in corporate governance, audit and compensation through his service on the boards of other public and private companies.
Peter J. Gundermann, 59
Chairman of the Board, Director, President and Chief Executive Officer of the Company; Director since 2001
Experience
Peter J. Gundermann has been a director of Astronics since 2001 and has held the position of President and Chief Executive Officer of the Company since 2003. Mr. Gundermann haswas named Chairman of the Board in June 2019. Mr. Gundermann had previously served as the President of Astronics’ Aerospace and Defense subsidiaries since 1991 and has been with the Company since 1988. He holds a B.A. in Applied Mathematics and Economics from Brown University and earned an M.B.A. from Duke University.
Other Public Company Board Memberships
Moog Inc.
Skills and Qualifications
Mr. Gundermann brings his deep institutional knowledge of the aerospace industry and of Astronics Corporation based on his tenure with the Company of more than thirty years. During this time, he has gained experience in the areas of M&A, finance and accounting, manufacturing and logistics, strategy, product development, customer management, and public company processes.
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PROPOSAL 1: ELECTION OF DIRECTORS
Warren C. Johnson, 62
Director, Compensation and Nominating/Governance Committees; Director since 2016
Experience
Warren C. Johnson served as President of the Aircraft Group for Moog Inc. from 2007 to 2016. Mr. Johnson was Vice President and General Manager of Moog’s Aircraft Group from 1999 to 2007 and prior to that served as Chief Engineer and Military Aircraft Product Line Manager of the Moog Aircraft Group. Mr. Johnson holds a B.S. and M.S. in Mechanical Engineering from The Ohio State University. In 2004, Mr. Johnson completed a SloansSloan Fellows M.B.A. at the Massachusetts Institute of Technology.
Kevin T.
Skills and Qualifications
Mr. Johnson brings noteworthy aerospace experience from his 33-year career at Moog Inc., a worldwide manufacturer of precision control components and systems, including leading Moog’s efforts to streamline aerospace product development cycle time and lean activities. His experience includes global operations as well as evaluating and integrating acquisition candidates.
Robert S. Keane, 59
Director, Compensation and Audit Committees; Director since 2019
Experience
Robert S. Keane has been Chairman of the Company since 1974. Mr. Keane was previously theserved as President and Chief Executive Officer of the Company. Mr. Keane began his career with the Company as Executive Vice PresidentCimpress plc since he founded Cimpress in 1970January 1995 and remains active in his role as Chairman of theCimpress plc’s Board of Directors since November 2018. Mr. Keane previously served as Chairman of Cimpress’s former Management Board from September 2009 to November 2018 and as the Company. He holdsChairman of its Board of Directors from January 1995 to August 2009. From 1988 to 1994, Mr. Keane was an A.B.executive at Flex-Key Corporation, a former subsidiary of Astronics Corporation. Mr. Keane earned his B.A. in Economics and an M.B.A. from Harvard University.
College and his MBA from INSEAD (France).
Other Public Company Board Memberships
Cimpress plc
Skills and Qualifications
Mr. Keane has extensive experience leading complex, global operations. He has a strong track record of growing successful companies both organically and by acquisition and is very experienced with public company processes. His previous experience with Astronics early in his career gives him a unique insight into the history and culture of the Company.
14
PROPOSAL 1: ELECTION OF DIRECTORS
Neil Y. Kim, 63
Director, Compensation and Audit Committees; Director since 2016
Experience
Neil Kim has served as Chief Technology Officer and Executive Vice President of Marvell Technology Group Ltd. sincefrom April 2017.2017 until his retirement in May 2019. Prior to that, Mr. Kim served as Broadcom Corporation’s Executive Vice President of Operations and Central Engineering until 2016 and was responsible for the company’s global manufacturing including foundry operations, supply chain management and corporate procurement. Mr. Kim joined Broadcom in 2000 and held a variety of senior management positions including Senior Vice President and Vice President of Central Engineering, as well as Senior Vice President of Operations and Engineering. Prior to Broadcom, from 1993 to 2000, Mr. Kim held a variety of senior technical and management positions includingat Western Digital Corporation, a provider of products and services for storage devices. His roles included Vice President of Engineering, where he managed critical product development and technical transitions at Western Digital Corporation, a global provider of products and services for storage devices.transitions. Mr. Kim served on the board of the Global Semiconductor Association from 2009 to 2015. Mr. Kim is named as an inventor on 33 patents. He received a B.S. in Electrical Engineering from the University of California, Berkeley.
Other Public Company Board Memberships
Silicon Laboratories Inc.(1)
(1) Mr. Kim’s term as director of Silicon Laboratories Inc. expired in April 2017.
Skills and Qualifications
Mr. Kim brings deep expertise in global operations, supply chain and manufacturing, as well as executive leadership. In addition to his public and private company Board experience, Mr. Kim has significant experience working for and with global organizations and in identifying, executing and integrating acquisitions.
Mark Moran, 66
Director, Compensation and Nominating/Governance Committees; Director since 2018
Experience
Mark Moran served as the Chief OperatingOperations Officer of Continental Airlines prior to his retirement in 2012. He spent 17 years with Continental prior to its acquisition by United Airlines. During his tenure, which included eight years as the head of Operations, Continental grew to the fifth largest U.S.US airline with 2,600 daily flights to over 260 airports. Since his retirement from Continental, Mr. Moran has served as an independent aviation consultant to several multinational OEMs and Tier 1 suppliers to OEMs. Prior to Continental, Mr. Moran served ten years with USAir/ Piedmont, and before that, five years with Boeing Corporation. He is a graduate of Marquette University, where he earned a B.S. in Engineering.
Mr. Moran brings strong aerospace experience to the Astronics board due to his career in the commercial airline industry. His perspective as a customer is a unique contribution to our deliberations. The Company is increasingly involved with promoting its products directly to operators, and his in-depth knowledge of airline operations and priorities complements the perspectives of others in the group.
3
15
PROPOSAL 1: ELECTION OF DIRECTORS
Other Directorships
Current directors and/or director nominees of the Company are presently serving, or have served during the preceding five years, on the following boards of directors of other publicly traded companies:
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE DIRECTOR NOMINEES.��
4
BOARD MATTERS
PROPOSAL 2: APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee, with the approval of the Board of Directors, has selected Ernst & Young LLP as the independent registered public accounting firm, to act as auditors of Astronics Corporation for 2019. All services provided on the Company’s behalf by Ernst & Young LLP during 2018 and
2017 were approved in advance by the Audit Committee. Representatives of Ernst & Young LLP are expected to attend the Annual Meeting and will have the opportunity to make a statement if they desire and will be available to respond to appropriate questions.
Audit Fees. The following table sets forth the fees billed to the Company for the last two years by the Company’s independent auditors, Ernst & Young LLP:
2018 | 2017 | |||||
Audit | $ | 1,290,190 | $ | 1,771,424 | ||
Audit-related | $ | ─ | $ | ─ | ||
Tax | $ | ─ | $ | ─ | ||
All Other | $ | ─ | $ | ─ | ||
The Audit Committee has adopted a policy that requires advance approval of all audit, audit-related, tax services, and other services performed by the independent auditor. The policy provides for pre-approval by the Audit Committee of specifically defined audit and non-audit services. Unless the specific service has been previously pre-approved with respect
to that year, the Audit Committee must approve the permitted service before the independent auditor is engaged to perform it. The Audit Committee may delegate to an Audit Committee member the authority to approve permitted services provided that the delegated member reports any decisions to the committee at its next scheduled meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE PROPOSAL TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2019 YEAR.
5
A majority of the Directors shall be independent, as that term is defined by applicable laws and regulations and in the NASDAQ listing standards. A Director will be considered independent only if the Board has affirmatively determined that the Director has no material relationship with Astronics, either directly or as a partner, shareholder or officer of an organization that has a relationship with Astronics that, based on the requirements of applicable laws and regulations and the NASDAQ listing standard, would impair his or her independent judgment. Not more than three individuals who fail to be determined to be independent Directors shall serve on the Board at any one time, provided, however, that this limitation on the number of non-independent directors shall not require a Director to resign or retire from the Board prior to the expiration of a term to which he or she was duly elected by the shareholders so long as the Board then has a majority of independent Directors.
The Board will annually review all commercial and charitable relationships of Directors to determine if there is a material
relationship that would preclude the Board from making an affirmative determination that an individual Director is independent. To facilitate this review, each non-employee Director will annually provide information regarding the Director’s business and other relationships with Astronics, its affiliates and senior management to enable the Board to evaluate the Director’s independence. This determination will be disclosed in the proxy statement for Astronics Corporation’s Annual Meeting of shareholders.
The Board of Directors has determined that each of its current directors, except for Mr. Gundermann, is independent within the meaning of the NASDAQ Stock Market, LLC director independence standards as currently in effect. In addition, each member of the Audit Committee, the Compensation Committee and the Nominating/Governance Committee is independent.
Board of Directors Ethics and Commitment
Directors shall possess the highest personal and professional ethics and integrity, and, in performance of their duties as directors, shall represent the long-term interests of the shareholders. The Board believes that its membership should reflect a diversity of experience, gender, race and ethnicity. Directors are selected on the basis of experience and personal capacities, including experience in industries similar to Astronics Corporation’s, managerial or other leadership experience; business acumen or particular expertise, business development experience, strategic capability, independence of judgment; familiarity with corporate governance, risk assessment and the responsibilities of directors; standing and reputation as a person of integrity; the potential contribution of each individual to the diversity of backgrounds, experience
and competencies which the Nominating/Governance Committee desires to have represented and ability to work constructively with the CEO and the Board.
Directors must devote sufficient time to carrying out their duties and responsibilities effectively and should be committed to serving on the Board for an extended period of time. Directors are expected to inform the Chairman if there is any significant change in their personal circumstances, including a change in their principal job responsibilities. Directors are expected to attend meetings of the Board and Committees of the Board on which they serve, except for good reason, and be prepared.
Board of Directors Meetings and Standing Committees
The Board of Directors and its committees meet regularly throughout the year and also hold special meetings and act by written consent from time to time as appropriate. All directors are expected to attend each meeting of the Board of Directors and the committees on which s/he serves, and are also invited, but not required, to attend the Annual Meeting. Messrs. Boushie, Brady, Drenning, Frisby, Gundermann, Johnson, Keane, Kim and McKenna attended the 2018 Annual Meeting. Mr. Moran did not attend as he had not yet been elected to the Board of Directors. The Board of Directors has three standing committees: an Audit Committee, Compensation Committee, and Nominating/Governance Committee. During the
year ended December 31, 2018,2021, the Board of Directors held six meetings. Each director attended at least 75% of the meetings of the Board of Directors held in 2018, other than 2021.
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BOARD MATTERS
Mr. Gundermann attended the 2021 Annual Meeting, but due to the COVID-19 pandemic, Ms. Calaway and Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran who joined the board in December 2018. Mr. McKenna retired from thedid not attend. The Board of Directors on May 31, 2018.
The has four standing
committees: an Audit Committee, a Compensation Committee, a Nominating/Governance Committee; and a Sustainability Committee. The Sustainability Committee was established in February 2022.
Audit Committee
The Audit Committee consists of Messrs. Brady (Chair), Boushie, Frisby, Keane and Kim, each of whom is independent within the meaning of the NASDAQ Stock Market, LLC director independence standards as currently in effect. The Board of Directors has determined that Messrs. Brady, Boushie, Frisby and Kim are each anit has more than one “audit committee financial expert” as defined under federal securities laws.laws serving on its Audit Committee. Information regarding the functions performed by the Committee is set forth in the “Report of the Audit Committee” included in this proxy statement. The Audit Committee held six meetings in 2018.2021. Each member of the Audit Committee attended at least
75% of the meetings of the Audit Committee held in 2018.2021 except for Mr. Boushie who attended 67% of the meetings. The Audit Committee is governed by a written charter approved by the Board of Directors that is posted on the “Corporate Governance” section of the Company’s website at https://investors.astronics.com/corporate-governance.
The corporate-governance.
Effective as of the date of the Annual Meeting, the Audit Committee will consist of Messrs. Brady (Chair), Boushie, Frisby and Kim.
Compensation Committee
The Compensation Committee consists of Ms. Calaway (current Chair), and Messrs. Boushie, (Chair), Brady, Johnson, Keane, Kim and Moran, each of whom is independent within the meaning of the NASDAQ Stock Market, LLC director independence standards as currently in effect. The Compensation Committee is responsible for reviewing and approving compensation levels for the
Company’s executive officers and reviewing and making recommendations to the Board of Directors with respect to other matters relating to the compensation practices of the Company. In appropriate circumstances, the Compensation Committee considers the recommendations of the Company’s Chief Executive Officer with respect to reviewing and approving compensation levels for other executive officers.The Compensation Committee does not use outside compensation consultants on a regular basis. The Committee may consult broad-based, third-party survey data
to obtain a general understanding of current compensation practices of companies of similar size and industry in which the Company competes for employees.
The Compensation Committee held fiveseven meetings in 2018.2021. Each of the Compensation Committee members attended at least 75% of the meetings of the Compensation Committee held in 2018, other than2021 except for Mr. MoranBoushie who joinedattended 71% of the Board in December 2018.meetings. The Compensation Committee is governed by a written charter approved by the Board of Directors that is posted on the “Corporate Governance” section of the Company’s website at https://investors.astronics.com/corporate-governance.
The corporate-governance.
Effective as of the date of the Annual Meeting, the Compensation Committee will consist of Messrs. Kim (Chair), Boushie, Keane and Moran.
Nominating/Governance Committee
The Nominating/Governance Committee consists of Messrs.Mr. Frisby (Chair), Ms. Calaway, and Messrs. Brady, Johnson and Moran, each of whom is independent within the meaning of the NASDAQ Stock Market, LLC director independence standards as currently in effect. The Nominating/Governance Committee is responsible for evaluating and selecting candidates for the Board of Directors and addressing corporate governance matters on behalf of the Board of Directors.
In performing its duties to recommend nominees for the Board of Directors, the Nominating/Governance Committee seeks director candidates with the following qualifications, at minimum: high character and integrity; substantial life or work experience that is of particular relevance to the Company; sufficient time available to devote to his or her duties; and ability and willingness to represent the interests of all shareholders rather than any special interest group. The Nominating/Governance Committee may use third-party search
firms to identify Board of Director candidates. It also relies upon recommendations from a wide
6
CORPORATE GOVERNANCE AND BOARD MATTERS
variety of its contacts, including current executive officers, directors, community leaders and shareholders, as a source for potential candidates.
Shareholders wishing to submit or nominate candidates for election to the Board of Directors must supply information in writing regarding the candidate to the Nominating/Governance Committee at the Company’s executive offices in East Aurora, New York. This information should include the candidate’s name, biographical data and qualifications. Generally, the Nominating/Governance Committee will conduct a process of making a preliminary assessment of each proposed nominee based upon biographical data and qualifications. This information is evaluated against the criteria described above and the specific needs of the Company at the time. Additional information regarding proposed nominees may be requested. On the basis of the information
information
17
BOARD MATTERS
gathered in this process, the Nominating/Governance Committee determines which nominees to recommend to the Board of Directors. The Nominating/Governance Committee uses the same process for evaluating all nominees, regardless of the source of the recommendation.
The Nominating/Governance Committee held fourtwo meetings in 2018. All2021. Each of the members of the Nominating/Governance Committee attended at least 75% of the meetings held in 2018, other than Mr. Moran who joined the Board in December 2018.
2021. The Nominating/Governance Committee is not governed by a written charter but acts pursuant to a resolution adopted bythat is posted on the “Corporate Governance” section of the Company’s website at https://investors.astronics.com/corporate-governance.
Effective as of the date of the Annual Meeting, the Nominating/Governance Committee will consist of Messrs. Moran (Chair), Johnson and Keane.
Sustainability Committee
In February 2022, the Board of Directors addressingdetermined to establish a Sustainability Committee. Effective as of the nomination processdate of the Annual Meeting, the Sustainability Committee will consist of Messrs. Frisby (Chair), Brady and Johnson. A
charter for the Sustainability Committee has not yet been adopted, though it is anticipated that it will be adopted in the coming months. The Sustainability Committee did not hold any meetings in 2021 as required by federal securities laws and NASDAQ Stock Market, LLC regulations.it had not yet been established.
Executive Sessions of the Board
Non-management directors meet regularly in executive sessions. Non-management directors are all those directors who are not Company employees and includes directors, if any, who are not independent as determined by the Board of Directors. The Company’s non-management directors consist of all of its current directors except Mr. Gundermann. An
An executive session of the Company’s non-management directors is generally held in conjunction with each regularly scheduled Board of Directors meeting. Additional executive sessions may be called at the request of the Board of Directors, the Lead Director or the non-management directors.
Corporate Social Responsibility
Governance
Astronics Corporation
Role of the Lead Director
In addition to the Chairman, the Board has a Lead Director. Mr. Brady has served in this role since February 2020. The principal role of the Lead Director is dedicated to conductingserve as liaison between the Chairman and CEO and the Directors. The specific responsibilities of the Lead Director are, among others, to:
(i) collaborate with the Chairman and CEO to ensure the appropriate flow of information to the Board;
(ii) consult with the Chairman and CEO regarding Board agenda items;
(iii) coordinate and develop the agenda for and preside at sessions of the Board’s independent Directors, and as appropriate, communicate to the Chairman and CEO the substance of the discussions;
(iv) in the absence of the Chairman, act as Chair of meetings of the Board;
(v) recommend, when necessary, special meetings of the Board; and
(vi) act as principal liaison between the Directors and the Chairman and CEO on sensitive issues.
The agenda for each Board meeting shall be established by the Chairman and the Lead Director, and any Director may request items to be included on the agenda. Ample time is scheduled for each Board meeting to assure full discussion of important matters whether included on the agenda or not. Agendas always include financial and operating reports in addition to other reports, such as business unit and subject matter presentations, that could enhance a Director’s perspective and knowledge on various matters. Agenda and meeting materials are distributed in advance of Board and Committee meetings, and each Director has a duty to review the materials prior to the meeting.
Board Refreshment and Experience
The Board is committed to continuous improvement and employs a rigorous process to ensure that the composition of the Board is diverse, balanced and aligned with integritythe evolving needs of the Company. The Board assesses the diversity of
the directors’ experience, expertise, perspective, tenure and responsibilityage, among other attributes, to ensure it has an appropriate mix of skills and experience to fulfill its oversight obligations.
18
BOARD MATTERS
The Board also considers the Company’s long-term strategy when evaluating which specific skills and experience are required and weighs those skills when evaluating the current and potential directors. As part of the evaluation of the directors’ skills and experience, the Board reviews a director
Annual Board Evaluation Process
The Board and each of the greater good. We promote honestCommittees shall perform annual self-evaluations. The Nominating/Governance Committee will develop and ethical conduct compliance with applicable government regulationsthe Board evaluation and accountability by allwill ensure
that each Committee of our directors, officers and employees.
the Board conducts its own self- evaluation. The Board of Directors has adopted a Code of Business Conductthen reviews this feedback and Ethics that is applicable to its Chief Executive Officer, Chief Financial Officermakes improvements, as well as all other directors, officers and employees of the Company. This Code of Business Conduct and Ethics is posted on the Company’s website at https://www.astronics.com/about/corporate-
necessary.
responsibility. The Company will disclose any amendment to this Code of Business Conduct and Ethics or waiver of a provision of this Code of Business Conduct and Ethics, including the name of any person to whom the waiver was granted, on its website.
Further, on April 1, 2018, the Company adopted a policy on Combatting Human Trafficking to ensure that employees, agents and suppliers of the Company do not engage in human trafficking or human trafficking activities. This policy is posted on the Company’s website at https://www.astronics.com/about/corporate-responsibility.
Environment
Astronics Corporation is committed to minimizing the impact of its activities on the environment. We maintain a variety of formal policies and procedures related to protection of the environment, energy conservation and waste management, as well as general business practices that are simply part of our culture.
In fact, two of our largest operations, Astronics Advanced Electronic Systems Corp. and Astronics Connectivity Systems & Certification Corp., are certified to ISO-14001, the international standard for effective environmental management. Both operations maintain formal programs that establish goals and measure progress towards those goals regarding
7
CORPORATE GOVERNANCE AND BOARD MATTERSLimit on Other Directorships
reductions and disposalDirectors who also serve as CEOs or in equivalent positions should not serve on more than two boards of hazardous substances, recycling and minimization of power consumption, among other efforts. In those operations that are not ISO-14001 certified, we meet or exceed all applicable environmental laws and regulations by maintaining many initiatives and practices that reduce our impact on the environment. Some examples of such initiatives and practices include policies to reduce paper consumption, policies to reduce single occupancy commuting, replacement
of older, less efficient lighting with more energy efficient motion based LED lighting, active waste recycling and water consumption reduction programs, and providing electric car recharging stations and bicycle storage at our largest operation.
We recognize the value and importance of reducing our impact on the global environment and will continue to expand those efforts as we move forward.
Safety & Health
Astronics is committedpublic companies in addition to the safetyAstronics Board, and other Directors should not serve on more than four other boards of public companies in addition to the Astronics Board. Membership on more public company boards by a director for exceptional reasons requires approval by the Nominating/Governance Committee or its customers and its employees. Each Astronics operation maintains environmental, health and safety policies that seekchairperson. Directors are expected to promotenotify the operation of our businessNominating/Governance Committee in a manner that is protective of the health and safety of the public and our employees. Our operations offer several health and welfare programs to employees to promote fitness and wellness and to encourage preventative healthcare.
writing before accepting
In addition, our employees
election or appointment to any public company board on which they did not serve when appointed to the Astronics Board.
The Board does not believe that arbitrary term limits on Directors’ service are offered a confidential employee assistance programappropriate nor does it believe that provides professional counseling to employees and their family members. Also, many of our operations offer greenspace for our employees to use during their breaks. Several of our operations have been recognized as “best places to work” in their local communities.
Community
Astronics supports and encourages its employeesDirectors should expect to be active and participate in local charitable activities. Astronics employees are permitted paid time off to volunteer at charitable
organizations. Additionally, each operation supports local not-for-profits and charities with financial contributions.
Diversity & Inclusion
Astronics believes that diversity and inclusion is criticalrenominated annually. The Board self-evaluation process noted below will be an important determinant for the attraction and retention of top talent. We employ policies and procedures to identify and hire women and minority candidates to fill job openings. To that end, the Company has also adopted an Equal Employment Opportunity Policy whereby Astronics Corporation commits to providing equal employment opportunity for all qualified employees and
Board tenure.
applicants without regard to race, color, sex, sexual orientation, gender identity, religion, national origin, disability, veteran status, age, marital status, pregnancy, genetic information or other legally protected status. This policy is posted on the Company’s website at https://www.astronics.com/docs/default-source/atro-legal/careers/equal-employment-opportunity-policy.pdf.
Compensation Committee Interlocks and Insider Participation
No interlocking relationship exists between any member of our Compensation Committee or any of our executive officers and any member of any other company’s board of directors or compensation committee (or equivalent).
No member of our Compensation Committee was, during 2018 or prior thereto, an officer or employee of our Company or any of our subsidiaries.
8
CORPORATE GOVERNANCE AND BOARD MATTERSBoard Interaction with Shareholders
Compensation of Directors
The following table sets forth the cash compensation as well as certain other compensation paid to the Company’s directors during the year ended December 31, 2018:
Name | Fees Earned or Paid in Cash | Option Awards(6) | Total | ||||||
Raymond W. Boushie(1) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
Robert T. Brady(1) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
John B. Drenning(1)(2) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
Jeffry D. Frisby(1) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
Peter J. Gundermann(3) | ─ | ─ | ─ | ||||||
Warren C. Johnson(1) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
Kevin T. Keane(1) | $ | 75,000 | $ | 59,760 | $ | 134,760 | |||
Neil Kim(1) | $ | 70,000 | $ | 59,760 | $ | 129,760 | |||
Robert J. McKenna(1)(4) | $ | 35,000 | $ | 59,760 | $ | 94,760 | |||
Mark Moran(5) | ─ | ─ | ─ | ||||||
Equity Awards
The Company’s 2017 Long Term Incentive Plan authorizes it to grant stock options, stock appreciation rights, restricted stock, restricted stock units and stock bonuses to non-employee directors of the Company. The Nominating/Governance Committee makes recommendations to the full Board as to equity grants for directors and awards are granted by the Board. The Nominating/Governance Committee reviews and approves equity awards to directors based upon a review of competitive compensation data, its assessment of individual performance and retention considerations. On March 2, 2018, each of Messrs. Boushie, Brady, Drenning, Frisby, Johnson, Keane, Kim and McKenna were awarded options to purchase 4,000 shares of Common Stock. On October 22, 2018, the Company distributed three shares of Class B Stock for every twenty shares of Common and Class B Stock held on the
record date of October 12, 2018. As a result, the options awarded to each of Messrs. Boushie, Brady, Drenning, Frisby, Johnson, Keane, Kim and McKenna now include an option to purchase 600 shares of Class B Stock of the Company. These options straight line vest over three years, vest in full on March 2, 2021, and terminate on March 2, 2028.
WhileAlthough the Company does not presently have a formal policy regarding communications with the Board of Directors, shareholders may communicate with the Board of Directors by writing to: Board of Directors, Astronics Corporation, 130 Commerce Way, East Aurora, New York 14052. Shareholders who would like their submission directed to a particular director may so specify and the communication will be forwarded, as appropriate.
The Board believes that management should speak for the corporation. Accordingly, each Director will refer all inquiries from shareholders, analysts, the press or customers to the CEO.
Proxy Access
A shareholder entitled to vote in the election of Directors, may nominate a candidate for the Board of Directors only if written notice of the shareholder’s intent to do so has been given, either by personal delivery or by United States mail, postage prepaid, to the Secretary of the corporation and received by the corporation (a) with respect to an election to be held at an Annual Meeting of shareholders, not later than sixty (60) nor more than ninety (90) days prior to the first anniversary of the preceding year’s Annual Meeting (or, if the date of the Annual Meeting is changed by more than twenty (20) days from such anniversary date, within ten (10) days after the date the corporation mails or otherwise give notice of the date of such meeting), and (b) with respect to an
election to be held at a special meeting of shareholders called for that purpose, not later than the close of business on the tenth (10th) day following the date on which notice of the special meeting was first mailed to the shareholders of the corporation.
Each shareholder’s notice of intent to make a nomination shall set forth: (i) the name(s) and address(es) of the shareholder who intends to make the nomination and of the person or persons to be nominated; (ii) a representation that the shareholder (a) is a holder of record of stock ownership guidelines for non-employee directors,of the non-employee directorscorporation entitled to vote at such meeting, (b) will continue to hold such stock through the date on which the meeting is held, and (c) intends to appear in person or by proxy at the meeting to
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BOARD MATTERS
nominate the person or persons specified in the notice; (iii) a description of all arrangements or understandings between the shareholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination is to be made by the shareholder; (iv) such other information regarding each nominee proposed by such shareholder as would be required to be included in a proxy statement filed pursuant to Regulation 14A promulgated under Section 14 of the Securities Exchange Act of 1934, as amended, as now in effect or hereafter modified, had the
nominee been nominated by the Board of Directors; and (v) consent of each nominee to serve as a class currently hold 1.9%director of the Common Stockcorporation if so elected. The corporation may require any proposed nominee to furnish such other information as may reasonably be required by the corporation to determine the qualifications of such person to serve as a director. No person shall be eligible for election as a director unless nominated (i) by a shareholder in accordance with the foregoing procedure or (ii) by the Board of Directors or a committee designated by the Board of Directors.
Board Evaluation and 33.1%Oversight of Risk
The Board of Directors oversees an enterprise-wide approach to risk management, designed to support the achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance shareholder value. A fundamental part of risk management is to understand the specific risks the Company faces and what mitigating steps are being taken, while balancing what is an appropriate level of risk for the Company. The involvement of the Class B Stockfull Board of Directors in setting business strategy is a key part of its assessment of management’s appetite for risk and also a determination of what constitutes an appropriate level of risk for the Company. On a regular basis, senior leaders are invited to present to the Board of Directors on each business. These presentations include opportunities as well as risks and mitigating actions. On an ongoing basis, the Company relies on its business leaders to identify and mitigate risks wherever possible.
While the Board of Directors has the ultimate oversight responsibility for the risk management process, various committees of the Company. We believe this aligns management’s interestsBoard also have responsibility for risk management. In particular, the Audit Committee focuses on financial risk, including internal controls over financial reporting, as well as compliance risk. In addition, in setting compensation, the Compensation Committee strives to create incentives that encourage a level of risk-taking behavior consistent with shareholder interests. See “Security Ownershipthe Company’s business strategy. The Company maintains a Cybersecurity policy as well as Complaint procedures for accounting and auditing matters (“Whistleblower”), the latter of Certain Beneficial Owners and Management”which may be found on page 29 below.the Corporate Governance section of the Company’s website. The Company conducts regular periodic training of its employees as to the protection of sensitive information which includes security awareness training intended to prevent the success of “phishing” attacks.
9
Board Leadership Structure and Size
At present, the Board has determined that combining the roles of the Chief Executive Officer and Chairman is in the best interests of the corporation. In addition to the Chairman, the Board has a Lead Director. The Board should be free to reconsider that determination in the future. It is the sense of the Board that a size of 7 to 9 members is about right for the corporation in light of its size and complexity of its business. The Board proposes a slate of nominees to the shareholders for election to the Board. Shareholders may propose nominees
for consideration by the Nominating/Governance Committee by submitting the names and supporting information according to the deadlines set forth in the corporation’s proxy statement for its most recent Annual Meeting to: Secretary, Astronics Corporation, 130 Commerce Way, East Aurora, New York 14052. Between annual shareholder meetings, the Board may elect Directors to fill vacancies to serve until the next Annual Meeting.
CEO Succession
The Board shall plan for the succession of the CEO. To assist the Board, the CEO will present an annual succession planning summary to the Board and will advise the Board of his recommendations and evaluations of potential successors. The Compensation Committee will assure assessment and
feedback by the Board of Directors to the CEO on the strategic leadership, development, and internal and external representation of the Company.
The Board believes that the primary and most constructive interaction with management is through the normal process of scheduled Board and Committee meetings, whether they be on
20
CORPORATE GOVERNANCE AND
BOARD MATTERS
regular business or special matters, at which any discussions can best be informed by the collective and varied knowledge and experience of Directors and management. The Board also recognizes, however, that matters of integrity and corporate conduct, were they to arise, may call for direct access to senior management. As is judicious under these circumstances, independent Directors are free to contact executive officers and
other senior managers of the corporation without senior corporate management present. As noted above in the Board Evaluation and Oversight of Risk discussion, senior leaders are invited on a regular basis to present to the Board of Directors on each business. In this manner, the Board becomes familiar with leadership beyond the office of the CEO and CFO.
Directors’ and Officers’ Indemnification Insurance
The Company has in place Directors’ and Officers’ Liability Insurance policies written by the Chubb Group, Zurich, C.N.A., AWAC, AIG Travelers,and AXA XL Catlin Insurance Co. and Ace American Insurance Co. for a twelve monthtwelve-month term expiring July 1, 2019.2022. The twelve monthtwelve-month premium was $434,507.$816,500. The policies have limits of $55 million in the aggregate and provide indemnification benefits and the payment of expenses in actions instituted against any director or officer of the Company for claimed liability arising out of their conduct in such capacities.
The Company also has entered into indemnification agreements with its directors and certain of its officers. The indemnification agreements provide that the director or officer will be indemnified for expenses, investigative costs and judgments arising from certain threatened, pending or completed legal proceedings.
Contacting the Board of Directors
Although we do not have a formal policy regarding communications with the Board of Directors, shareholders may communicate with the Board of Directors by writing to: Board of Directors, Astronics Corporation, 130 Commerce
Way, East Aurora, New York 14052. Shareholders who would like their submission directed to a particular director may so specify and the communication will be forwarded, as appropriate.
Board Composition and Diversity
Our
The Nominating/Governance Committee is responsible for developing the general criteria, subject to approval of ourthe Board of Directors, for use in identifying, evaluating and selecting qualified candidates for election or re-election to the Board. The Nominating/Governance Committee periodically reviews the appropriate skills and characteristics required of the Board members in the context of the current composition of the Board. The Nominating/Governance Committee, in recommending candidates to the Board, seeks to create a Board that is strong in its collective knowledge and has a diversity of skills and experience with respect to accounting and finance, management and leadership, vision and strategy, business operations, business judgment, industry knowledge, corporate governance and global markets. When the Nominating/Governance Committee reviews a potential new candidate, it looks specifically at the candidate’s qualifications in light of the needs of the Board and the Company at that time, given the attributes of the existing Directors. In identifying candidates for director, the Board of Directors takes into account (i) the comments and recommendations of board members regarding the qualifications and effectiveness of the existing Board of Directors or additional qualifications that may be required when selecting new board members, (ii) the requisite expertise and sufficiently diverse backgrounds of the Board of Directors’ overall membership composition, (iii) the independence of outside directors and other possible conflicts of interest of existing and potential members of the Board of Directors and (iv) all other factors it considers
account:
| (i) | the comments and recommendations of Board members regarding the qualifications and effectiveness of the existing Board of Directors or additional qualifications that may be required when selecting new board members; |
| (ii) | the requisite expertise and sufficiently diverse backgrounds of the Board of Directors’ overall membership composition; |
appropriate. Although the Company has no policy regarding diversity,
| (iii) | the independence of outside directors and other possible conflicts of interest of existing and potential members of the Board of Directors; and |
| (iv) | all other factors it considers appropriate. |
The Board of Directors believes that ethnic and gender diversity is anare important component of a board of directors, includingconsiderations when evaluating Director candidates along with such factors as background, skills, experience and expertise. WeAt present, 11% of the Board is diverse with respect to gender and 22% of the Board is diverse with respect to race/ethnicity. Ms. Calaway is diverse with respect to gender and race/ethnicity and Mr. Kim is diverse with respect to race/ethnicity. The Company will continue to consider all of these factors as well as gender diversity when consideringproposing future directors.
candidates for the Board.
With respect to the current slate of Directors, the Board of Directors focused primarily on the information discussed in each of the directors’ individual biographies set forth elsewhere in this proxy statement. In particular, with regard to Messrs. Boushie, Brady, Frisby, Johnson, and Johnson,Moran, the Board of Directors considered their significant experience, expertise and background with regard to the aerospace industry. With regard to Mr.Messrs. Kim and Keane, the Board of Directors considered histheir technical knowledge, and significant mergers and acquisition experience. When the Board of Directors selected Mr. Moran for the Board, the Board of Directors considered Mr. Moran’s significant experience, and expertise and background with respect to the commercial airline industry andcomplex, multinational OEMs and their Tier 1 suppliers.organizations. The Board of Directors also considered the manymore than thirty years of experience with the Company represented by Messrs. Keane andMr. Gundermann, the Company’s Chairman of the Board and Chief Executive Officer, respectively, with over forty-five years in the case of Mr. Keane, and over twenty-five years in the case of Mr. Gundermann.Officer.
21
BOARD MATTERS
10
| | Board Diversity Matrix as of April 11, 2022 | | ||||||||||||
| | Total Number of Directors | | | 9 | | |||||||||
| | | | Female | | | Male | | | Non-Binary | | | Did Not Disclose Gender | | |
| | Part I: Gender Identity | | | | | | | | | | ||||
| | Directors | | | 1 | | | 8 | | | — | | | — | |
| | Part II: Demographic Background | | | | | | | | | | ||||
| | African American or Black | | | 1 | | | — | | | — | | | — | |
| | Alaskan Native or Native American | | | — | | | — | | | — | | | — | |
| | Asian | | | — | | | 1 | | | — | | | — | |
| | Hispanic or Latinx | | | — | | | — | | | — | | | — | |
| | Native Hawaiian or Pacific Islander | | | — | | | — | | | — | | | — | |
| | White | | | — | | | 6 | | | — | | | — | |
| | Two or More Races or Ethnicities | | | — | | | — | | | — | | | — | |
| | LGBTQ+ | | | — | | |||||||||
| | Did Not Disclose Demographic Background | | | 1 | | |||||||||
CORPORATE GOVERNANCE AND BOARD MATTERS
Board Leadership Structure
The rolesfollowing table sets forth the cash compensation as well as certain other compensation of the Company’s Chairmandirectors for the year ended December 31, 2021:
| | Name | | | Fees Earned or Paid in Cash | | | Restricted Stock Unit Awards(4) | | | Total | |
| | Raymond W. Boushie(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Robert T. Brady(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Tonit M. Calaway(1) (2) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Jeffry D. Frisby(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Peter J. Gundermann(3) | | | — | | | — | | | — | |
| | Warren C. Johnson(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Robert S. Keane(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Neil Kim(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| | Mark Moran(1) | | | $75,000 | | | $110,025 | | | $185,025 | |
| (1) | In 2021, Ms. Calaway and each of Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran were awarded 6,750 Restricted Stock Units under the 2017 Long Term Incentive Plan. Each Restricted Stock Unit represents the right to receive, at settlement, one share of Common Stock. The Restricted Stock Units issued to Ms. Calaway and Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran vested in full six months from the grant date on August 26, 2021, on which date Ms. Calaway and each of Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran were issued 6,750 shares of Common Stock. At December 31, 2021, Messrs. Boushie, Brady, Frisby, Johnson and Kim had options to purchase 23,000; 23,000; 8,000; 8,000 and 8,000 shares of Common Stock, respectively, and 13,829; 13,829; 1,200; 1,200 and 1,200 shares of Class B Stock, respectively. The exercise price is 100% of the fair market value on date of grant. As of December 31, 2021, Ms. Calaway, Mr. Keane and Mr. Moran did not have any options to purchase shares of Common Stock or Class B Stock. |
| (2) | Ms. Calaway’s term as director will expire on the date of the Annual Meeting. |
| (3) | Mr. Gundermann receives no separate compensation as a director of the Company. |
| (4) | The total fair value of the award is determined under generally accepted accounting principles used to calculate the value of equity awards for purposes of the Company’s financial statements as described in Note 16 to the audited financial statements in Astronics Corporation’s Annual Report on Form 10-K for the year ended December 31, 2021. The amounts do not reflect the actual amounts realized by the director. |
Compensation Committee Interlocks and Insider Participation
No interlocking relationship exists between any member of the BoardCompensation Committee or any of the Company’s executive officers and its Chief Executive Officer have been served by separate individuals since 2003. The Company believes this leadership structure supports its current belief that it isany member of any other company’s board of directors or compensation committee (or equivalent).
No member of the Chief Executive Officer’s responsibility to manageCompensation Committee was, during 2021 or prior thereto, an officer or employee of the Company or any of its subsidiaries.
22
BOARD MATTERS
The Board believes that, in order to align the interests of the Directors and shareholders, Directors should have a significant financial stake in the Chairman’s responsibilityCompany. The Corporate Governance Guidelines adopted by the Board in December 2019, as amended on February 26, 2021, provide that within four years of joining the Board or within four years of adoption of the
Guidelines, whichever is later, each non-employee Director is expected to manageaccumulate and maintain ownership of at least the number of shares equal to 400% of the annual cash retainer for the applicable calendar year, divided by the average of the closing price of a share of Astronics Corporation Common Stock for the previous calendar year.
Equity Awards
The Company’s 2017 Long Term Incentive Plan authorizes it to grant stock options, stock appreciation rights, restricted stock, restricted stock units and stock bonuses to non-employee directors of the Company. The Nominating/Governance Committee makes recommendations to the full Board as to equity grants for directors and awards are granted by the Board. The Company believes its Chief Executive OfficerNominating/Governance Committee reviews and Chairmanapproves equity awards to directors based upon a review of the Board have an excellent working relationship that has allowed Mr. Gundermann to focus on the challenges that the Company is facing in the current business environment. By separating the roles of the Chairman of the Board and Chief Executive Officer positions, the Company ensures there is no
duplication of effort between them. This provides strong leadership for the Company’s Board of Directors, while also positioning the Chief Executive Officer as the leader of the Company in the eyes of its customers, employees and other stakeholders.
Effective as of June 1, 2016, Mr. Boushie serves as Lead Director of the Board. As Lead Director, Mr. Boushie has authority to convene meetings of the non-management members of the Board of Directors, to act as the Chairman of such meetings and to determine the agenda thereof.
Risk Oversight
The Board of Directors oversees an enterprise-wide approach to risk management, designed to support the achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance shareholder value. A fundamental part of the Company’s risk management is not only understanding the risks it faces and what steps management is taking to manage those risks, but also understanding what level of risk is appropriate for the Company. The involvement of the full Board of Directors in setting the Company’s business strategy is a key part ofcompetitive compensation data, its assessment of management’s appetite for riskindividual performance and alsoretention considerations. On February 26, 2021, Ms. Calaway and each of Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran were awarded 6,750 Restricted Stock Units. Each Restricted Stock Unit represents the right to receive, at settlement, one share of Common Stock.
The Restricted Stock Units issued to Ms. Calaway and Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran vested in full six months from the grant date on August 26, 2021, on which date Ms. Calaway and each of Messrs. Boushie, Brady, Frisby, Johnson, Keane, Kim and Moran were issued 6,750 shares of Common Stock.
The non-employee directors as a determinationclass currently hold 1.3% of what constitutes an appropriate levelthe Common Stock and 13.5% of risk forthe Class B Stock of the Company.
While the Board We believe this aligns management’s interests with shareholder interests. See “Security Ownership of Directors has the ultimate oversight responsibility for the risk management process, various committees of the Board also have responsibility for risk management. In particular, the Audit Committee focusesCertain Beneficial Owners and Management” on financial risk, including internal controls over financial reporting, as well as compliance risk. In addition, in setting compensation, the Compensation Committee strives to create incentives that encourage a level of risk-taking behavior consistent with the Company’s business strategy.
11
23
CORPORATE GOVERNANCE AND
BOARD MATTERS
Executive Officers
The executive officers of the Company, their ages, their positions and offices with the Company, and the date each assumed office with the Company, are as follows:
| | Name and Age of Executive Officer | | | Positions and Offices with Astronics | | | Year First Elected Officer | |
| | Peter J. Gundermann, Age | | | Chairman, President, Chief Executive Officer and Director of the Company | | | 2001 | |
| | David C. Burney, Age | | | Executive Vice | | | 2003 | |
| | James S. Kramer, Age | | | Executive Vice President of the Company; President of Luminescent Systems, Inc. and Astronics DME LLC | | | 2010 | |
| | Michael C. Kuehn, Age | | | Executive Vice President of the Company; President of Astronics Connectivity Systems & Certification Corp. | | | 2017 | |
| | James F. Mulato, Age | | | Executive Vice President of the Company; President of Astronics Test Systems, Inc. | | | 2014 | |
| | Mark A. Peabody, Age | | | Executive Vice President of the Company; President of | | | 2010 | |
The principal occupation and employment for Messrs. Gundermann, Burney, Kramer, Mulato and Peabody for the past five years has been with the Company in their respective current roles.
Mr. Kuehn and Mr. Mulato became Executive Vice Presidents of the Company on January 1, 2019.
Mr. Kuehn has been the President of Astronics Connectivity Systems & Certification Corp. since its acquisition by the
Company in 2017, and the President of Armstrong Aerospace,
Inc. since 2018.2017. Prior to acquisition, Mr. Kuehn ran that business as President of Telefonix, Incorporated for eight years. Prior to that, Mr. Kuehn was employed with Verizon Airfone, previously GTE Airfone, where he spent over 25 years managing complex projects across numerous business units. Prior to that, Mr. Kuehn was involved in the managementhas also served as President of civilArmstrong Aerospace, Inc. since 2018 and military aviation programs at MPC, Inc.President of Astronics Aerosat Corporation since 2021. Mr. Kuehn earned his undergraduate degree from Lewis University and is currently pursuing a graduate degree from Lewis as well.
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24
PROPOSAL 2: APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
| | | | | THE BOARD RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG, LLP TO AUDIT THE COMPANY’S CONSOLIDATED FINANCIAL STATEMENTS FOR 2022. | |
The Audit Committee, with the approval of the Board of Directors, has selected Ernst & Young LLP as the independent registered public accounting firm, to act as auditors of Astronics Corporation for 2022. All services provided on the Company’s behalf by Ernst & Young LLP during 2021 and
2020 were approved in advance by the Audit Committee. Representatives of Ernst & Young LLP are expected to attend the Annual Meeting and will have the opportunity to make a statement if they desire and will be available to respond to appropriate questions.
The Audit Committee has adopted a policy that requires advance approval of all audit, audit-related, tax services, and other services performed by the independent registered public accounting firm. The policy provides for pre-approval by the Audit Committee of specifically defined audit and non-audit services. Unless the specific service has been previously pre-approved with respect to that year, the Audit Committee
must approve the permitted service before the independent registered public accounting firm is engaged to perform it. The Audit Committee may delegate to an Audit Committee member the authority to approve permitted services provided that the delegated member reports any decisions to the Committee at its next scheduled meeting.
THE BOARD OF CONTENTSDIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE PROPOSAL TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT
CORPORATE GOVERNANCE AND BOARD MATTERSREGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2022 YEAR.
25
REPORT OF THE AUDIT COMMITTEE
The Audit Committee oversees the Company’s financial reporting process on behalf of the Board of Directors. Management has primary responsibility for the financial statements and the reporting process including the systems of internal controls. In fulfilling its oversight responsibilities, the Committee reviewed the audited financial statements in the Annual Report with management and the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the financial statements.
The Audit Committee is comprised of the directors named below, each of whom is independent as defined under Section 10A(m)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and under the NASDAQ Stock Market, LLC listing standards currently in effect. In addition, pursuant to the requirements of Section 407 of the Sarbanes-Oxley Act of 2002, the Board of Directors has determined that each of Messrs. Boushie, Brady, Frisby and Kim qualify as anit has more than one “audit committee financial expert.”
expert” as defined under federal securities laws serving on its Audit Committee.
The Audit Committee operates under a written charter which includes provisions requiring Audit Committee advance approval of all audit and non-audit services to be provided by independent public accountants.
The Audit Committee reviewed and discussed with management and Ernst & Young LLP, the Company’s independent registered public accounting firm, the Company’s audited consolidated financial statements for the year ended December 31, 2018.2021. In addition, the Audit Committee discussed with the independent registered public accounting firm the matters required to be discussed by Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 1301, Communications with Audit Committees.
Committees.
The Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by the applicable requirements of the PCAOB regarding the independent public accounting firm’s communications with the Audit Committee concerning independence, and the Audit Committee discussed with the independent registered public accounting firm that firm’s independence.
Based on the Audit Committee’s review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2018,2021, filed with the Securities and Exchange Commission.
| | April | | | Robert T. Brady, Chairman Raymond W. Boushie Jeffry D. Frisby Robert S. Keane Neil Kim | |
In accordance with and to the extent permitted by applicable law or regulation, the information contained in the Report of Audit Committee of Astronics Corporation shall not be incorporated by reference into any future filing under the
Securities Act or the Exchange Act and shall not be deemed to be “soliciting material” or to be “filed” with the SEC under the Securities Act or the Exchange Act.
13
EXECUTIVE COMPENSATION
The Company’s compensation philosophy and program objectives are directed by two primary guiding principles. First, the program is intended to provide levels of compensation sufficient to attract, motivate and retain talented executives. Second, the program is intended to create an alignment of interests between the Company’s executives and shareholders such that a portion of each executive’s compensation is directly linked to maximizing long-term growth of shareholder value.
The Company’s goals are to outperform its industry, in terms of growth, financial performance, and innovation. In support of these goals, the executive compensation program is designed to energize its executive officers to outperform its industry and to reward performance that is directly relevant to the Company’s short-term and long-term success. As such, the Company provides both short-term and long-term incentives. The Committee has structured the executive compensation program with three primary underlying components: base
salary, annual cash bonus incentives and long-term incentives. The Company’s compensation objective is to
(i) compensate its executive officers at a base level that is competitive with salaries near the average salaries paid by companies of similar size and nature, (ii) provide the opportunity for its executive officers to earn additional compensation in the form of annual cash bonuses, and (iii) design long-term incentive plans to focus executive efforts on the long-term goals of the Company and to maximize total return to the Company’s shareholders, while taking into account the Company’s performance and strategic goals.
The Compensation Committee utilizes its expertise and knowledge of the markets in which the Company competes for employees in determining compensation policy. In addition, the Committee may consult broad-based, third-party survey data to obtain a general understanding of current compensation practices of companies of similar size and industry.
The Company does not have a policy regarding hedging or pledging of Company stock and as such hedging transactions are generally permitted.
Base Salary
Base Salary
The Compensation Committee approves the salaries paid to the Company’s executive officers and, as part of its responsibilities, reviews these salaries annually. Individual salary changes are based on a combination of factors such as the performance of the executive, salary level relative to the
competitive market, level of responsibility, growth of Company operations and experience of the executive. In appropriate circumstances, the Compensation Committee considers the recommendations of the Company’s Chief Executive Officer.
Cash Bonus
Cash Bonus
The Compensation Committee has the authority to award discretionary annual incentive cash bonuses to the Company’s executive officers. Annual incentive bonuses are intended to compensate officers for achieving financial, strategic and operational success. Bonuses are not tied to specific, objective targets such as achieving a particular profit level. The Compensation Committee considers a number of factors in determining bonuses. Factors considered include profitability, sales growth over the most recent two- or three-year period, the performance of the individual in the view of the Compensation Committee, comparisons to external
broad-based compensation
broad-based compensation
data provided by a third party for the purpose of obtaining a general understanding of compensation practices of companies of similar size and industry and available information with respect to the aerospace and defense industry. Bonuses are not capped. Bonuses are reviewed and approved by the Compensation Committee. In appropriate circumstances, the Compensation Committee considers the recommendations of the Company’s Chief Executive Officer. In 2020 and 2021, cash bonuses were suspended as the Company recovered from the impact of the COVID-19 pandemic on the Company.
Long-Term Incentives
Long-Term Incentives
The Company believes that long-term performance is achieved through an ownership culture that incentivizes its executive officers through the use of stock-based awards. The Company’s stock option plans and the Company’s 2017 Long Term Incentive Plan, as Amended and Restated in May 2021 (the “LTIP”) werewas established to provide certain of the Company’s employees, including its executive officers, with incentives to help align those employees’ interests with
the long-term interests of the Company’s
shareholders. The Compensation Committee believes that the use of stock-based awards and restricted stock units is an important element of achieving its compensation goals. The Company’s broad-based Employee Stock Purchase Plan, its prior stock option plans, and 2017 Long Term Incentive Planthe LTIP have provided the principal methodmethods for its executive officers to acquire equity or equity-linked interests in the Company.
14
27
EXECUTIVE COMPENSATION
Astronics Corporation 2017 Long Term Incentive Plan
In May 2017, the 2017 Long Term Incentive Plan was approved by shareholders, providing for the grant of 1,757,040 shares of stock-based awards. This amount includesincluded 757,040 shares previously available for issuance under the 2005 Director Stock Option Plan and the 2011 Stock Option Plan, plus an additional 1,000,000 shares. In May 2021, the Amended and Restated 2017 Long Term Incentive Plan was approved by shareholders, providing for an increase in the
number of shares of stock with respect to which awards may be issued under the plan from 1,757,040 to 3,144,774. The LTIP provides a
more flexible framework that permits the development and implementation of a variety of stock-based incentives which will enableenables the Company to base awards on key performance metrics as well as to further align ourits long-term incentive compensation with our peers and shareholder interests.
Options
Options
The LTIP authorizes the Company to grant options to purchase shares of common stock to its employees. Prior to approval of the LTIP, the Company issued options to executive officers and key employees under its 2011 Stock Option Plan. No new issuances will be made under the 2011 Stock Option Plan. The goal of stock options is to create long-term incentives for key employees to maximize future performance of the Company. The Compensation Committee is the administrator of the 2017 Long Term Incentive Plan.LTIP. Stock option grants generally are made annually or at the commencement of employment. The Compensation Committee reviews and approves equity awards to executive officers based upon a review of competitive compensation data, its expectation of future individual performance, a review of each executive’s existing long-term incentives and retention
considerations. Periodic stock option grants are made at the discretion of the Compensation Committee to eligible employees and, in appropriate circumstances, the Compensation Committee considers the recommendations of the Company’s Chief Executive Officer. In
Stock options have historically been awarded in December 2018,of each year, but as the Named Executive OfficersCompensation Committee did not meet in December 2020, no stock options were awarded stock options under the LTIPin 2020 and were instead awarded in January 2021 in the amounts indicated in the section entitled “Grants of Plan-Based Awards” on page 2035 below. Separate awards were made in December 2021 in accordance with the usual practice in the amounts indicated in the section entitled “Grants of Plan-Based Awards” on page 35 below. Stock options granted by the Company have an exercise price equal to the fair market value of the Common Stock on the day of grant typically straight line vest 20% per annum based upon continued employment over a 5-year period, and generally expire 10 years after the date of grant. The stock options awarded in January 2021 straight-line vest 20% per annum based upon continued employment. The stock options awarded in December 2021 straight-line vest 33-1/3% per annum based on continued employment. Incentive stock options also include certain other terms necessary to assure compliance with the Internal Revenue Code of 1986, as amended.
Restricted Stock Units
In 2018,2021, the Company issued performance-based restricted stock units (“RSUs”) to named executive managementofficers and time-based restricted stock units to key employees. In March 2018,February 2021, the Company issued performance-based restricted stock units to Messrs. Gundermann, Burney, Kramer, Peabody, Mulato and MulatoKuehn in the amounts indicated in the section entitled “Grants of Plan-Based Awards” on page 2035 below. The performance criteria for issuance of such awards is based on the Company’s average annual Adjusted EBITDA for the period of January 1, 20182021 through December 31, 2020.2023. Adjusted EBITDA is defined as the Company’s earnings before interest, taxes, depreciation, and amortization, adjusted by the Compensation Committee in its sole discretion for any extraordinary, unusual or nonrecurring events, including, but not limited to insurance
proceeds, legal settlements, impairments or unique investments in R&D projects.
The target number of RSUs will be issuedearned if the Company’s mathematical average annual Adjusted EBITDA for the performance period is less than 15%, but at least equal to 10%, of the Company’s mathematical average annual revenue for the performance period. The threshold number of RSUs will be issuedearned if the average annual Adjusted EBITDA is less than 10% of the average annual revenue for the performance period. The maximum number of RSUs will be issuedearned if the average annual Adjusted EBITDA is greater than or equal to 15% of the average annual revenue for the performance period. In addition, in February 2021, the Company issued time-based RSUs to named executive officers in lieu of salary increases. Those RSUs straight line vest 33-1/3% per annum based on continued employment. Each RSU will be settled in one share of our Common Stock.
Stock Ownership
Stock Ownership
While the Company does not presently have stock ownership guidelines for executive officers, the Named Executive Officers as a class currently hold 1.4%2.0% of the Common Stock and 19.2%25.0% of the Class B Stock of the Company. We believeThe Company believes this
aligns management’s interests with shareholder
28
EXECUTIVE COMPENSATION
Employment Agreements
The Company has entered into an Employment Termination Benefits Agreement with each of Messrs. Gundermann, Burney, Kramer and Peabody, as described on page 2540 below. In addition, as
described in the “Pension Benefits” section beginning on page 2338 below, Mr. Gundermann is a participant
in the SERP, while Messrs. Burney, Kramer and Peabody are each
15
EXECUTIVE COMPENSATION
participants in the SERP II. The Company has not entered into an Employment Termination Benefits Agreement with Messrs.Mr. Kuehn or Mr. Mulato. Neither Messrs. Kuehn nor Mulato are participants in the SERP or SERP II.
The Role of Shareholder Say-on-Pay Votes
The Company provides its shareholders with the opportunity to cast an advisory vote every three years on its executive compensation program (referred to as a “say-on-pay proposal”). At the Company’s Annual Meeting of Shareholders held on May 31, 2017,21, 2020, approximately 95%88% of the votes cast on the say-on-pay proposal at that meeting were voted in favor of the proposal. The Compensation Committee believes
that this result affirms shareholders’ support of the Company’s approach to executive compensation, and therefore maintained this approach in 2018.2021. The Compensation Committee will continue to consider the outcome of the Company’s say-on-pay votes when making future compensation decisions for named executive officers.
Compensation Committee Report
29
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the “Committee”) determines the compensation of the Chief Executive Officer and other executive officers of the Company. The Committee is composed entirely of directors who are neither executive officers nor employees of the Company. In addition to determining the salary and bonus compensation for the Company’s executive officers, the Committee determines the grants under the Company’s Stock Option Plans and 2017 Long Term Incentive Plan and oversees the administration of other compensation plans and programs.
The Committee has reviewed the Compensation Discussion and Analysis contained elsewhere in this proxy statement and has discussed it with management. In reliance on the reviews and discussions referred to above, the Committee recommended to the Board of Directors (and the Board has approved) that the Compensation Discussion and Analysis be included in this proxy statement and in the Annual Report on Form 10-K for the year ended December 31, 20182021 for filing with the Securities and Exchange Commission.
| | April | | | Tonit Calaway, Chairman Raymond W. Boushie Warren C. Johnson Robert S. Keane Neil Kim Mark Moran | |
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30
EXECUTIVE COMPENSATION
In reviewing our executive compensation, it is important to distinguish the reported compensation provided to our Named Executive Officers from the compensation that was actually awarded to our Named Executive Officers. We haveThe Company has provided the following additional compensation table in order to remove the volatility related to the effects of changes in actuarial assumptions on the value of the Named Executive
Officers’ pension benefits as required to be disclosed in the
Summary Compensation Table. This table is not a substitute for the Summary Compensation Table, which appears on the next page.
The table below shows the total compensation required to be reported in the Summary Compensation Table, but excluding any change in pension value.
Name and Principal Position | Year | Salary | Bonuses | Stock Awards(1) | Option Awards(2) | All Other Compensation | Total | ||||||||||||
Peter J. Gundermann, President and Chief Executive Officer | 2018 | $ | 549,270 | $ | 478,827 | $ | 70,633 | $ | 531,243 | $ | 100,378 | (3) | $ | 1,730,351 | |||||
2017 | $ | 538,500 | $ | 223,209 | — | $ | 525,474 | $ | 65,331 | $ | 1,352,514 | ||||||||
2016 | $ | 528,000 | $ | 637,288 | — | $ | 277,054 | $ | 116,965 | $ | 1,559,307 | ||||||||
David C. Burney, Executive Vice President – Finance and Chief Financial Officer | 2018 | $ | 331,888 | $ | 236,221 | $ | 42,856 | $ | 128,421 | $ | 43,941 | (4) | $ | 783,327 | |||||
2017 | $ | 325,380 | $ | 112,418 | — | $ | 126,873 | $ | 32,156 | $ | 596,827 | ||||||||
2016 | $ | 319,000 | $ | 305,762 | — | $ | 83,729 | $ | 34,227 | $ | 742,718 | ||||||||
James S. Kramer, Executive Vice President | 2018 | $ | 278,827 | $ | 218,952 | $ | 36,014 | $ | 107,806 | $ | 33,980 | (5) | $ | 675,579 | |||||
2017 | $ | 273,360 | $ | 98,072 | — | $ | 106,693 | $ | 33,136 | $ | 511,261 | ||||||||
2016 | $ | 268,000 | $ | 244,751 | — | $ | 70,317 | $ | 28,814 | $ | 611,882 | ||||||||
James F. Mulato, Executive Vice President (6) | 2018 | $ | 332,194 | $ | 163,271 | $ | 85,134 | $ | 176,674 | $ | 49,895 | (7) | $ | 807,168 | |||||
2017 | $ | 325,680 | $ | 91,272 | — | $ | 158,841 | $ | 49,434 | $ | 625,227 | ||||||||
2016 | $ | 319,290 | $ | 289,759 | — | $ | 125,690 | $ | 48,096 | $ | 782,835 | ||||||||
Mark A. Peabody, Executive Vice President | 2018 | $ | 366,231 | $ | 337,886 | $ | 47,145 | $ | 141,706 | $ | 14,126 | (8) | $ | 907,094 | |||||
2017 | $ | 359,050 | $ | 276,047 | — | $ | 140,060 | $ | 13,500 | $ | 788,657 | ||||||||
2016 | $ | 352,000 | $ | 388,039 | — | $ | 92,351 | $ | 13,250 | $ | 845,640 | ||||||||
| | Name and Principal Position | | | Year | | | Salary | | | Bonuses | | | Stock Awards(1) | | | Option Awards(2) | | | All Other Compensation | | | Total | |
| | Peter J. Gundermann, President and Chief Executive Officer | | | 2021 | | | $571,460 | | | — | | | $217,230 | | | $1,600,279(3) | | | $63,668(4) | | | $2,452,637 | |
| | 2020 | | | $571,460 | | | — | | | $200,346 | | | — | | | $59,410 | | | $831,216 | | |||
| | 2019 | | | $560,300 | | | $342,178 | | | $65,970 | | | $799,884 | | | $76,930 | | | $1,845,262 | | |||
| | | | | | | | | | | | | | | | | ||||||||
| | David C. Burney, Executive Vice President – Finance and Chief Financial Officer | | | 2021 | | | $355,550 | | | — | | | $141,077 | | | $300,238(3) | | | $40,445(5) | | | $837,310 | |
| | 2020 | | | $355,550 | | | — | | | $130,446 | | | — | | | $41,655 | | | $527,651 | | |||
| | 2019 | | | $343,500 | | | $237,272 | | | $39,827 | | | $150,008 | | | $55,929 | | | $826,536 | | |||
| | | | | | | | | | | | | | | | | ||||||||
| | James S. Kramer, Executive Vice President | | | 2021 | | | $292,932 | | | — | | | $128,754 | | | $300,238(3) | | | $30,889(6) | | | $752,813 | |
| | 2020 | | | $292,932 | | | — | | | $120,109 | ��� | | — | | | $33,677 | | | $446,718 | | |||
| | 2019 | | | $284,400 | | | $269,596 | | | $33,453 | | | $150,008 | | | $33,219 | | | $770,676 | | |||
| | | | | | | | | | | | | | | | | ||||||||
| | Michael C. Kuehn, Executive Vice President | | | 2021 | | | $369,342 | | | — | | | $181,419 | | | $400,521(3) | | | $11,933(7) | | | $963,215 | |
| | 2020 | | | $369,342 | | | — | | | $170,319 | | | — | | | $14,250 | | | $553,911 | | |||
| | | | 2019 | | | $362,100 | | | $217,260 | | | $88,765 | | | $200,195 | | | $14,000 | | | $882,320 | | |
| | | | | | | | | | | | | | | | | ||||||||
| | James F. Mulato, Executive Vice President | | | 2021 | | | $348,962 | | | — | | | $180,604 | | | $400,521(3) | | | $32,112(8) | | | $962,199 | |
| | 2020 | | | $348,962 | | | — | | | $170,319 | | | — | | | $131,605 | | | $650,886 | | |||
| | 2019 | | | $338,800 | | | $426,410 | | | $83,039 | | | $200,195 | | | $43,882 | | | $1,092,326 | | |||
| | | | | | | | | | | | | | | | | ||||||||
| | Mark A. Peabody, Executive Vice President and President of Aerospace Segment | | | 2021 | | | $480,970 | | | — | | | $174,589 | | | $300,238(3) | | | $16,035(9) | | | $971,832 | |
| | 2020 | | | $461,739 | | | — | | | $130,446 | | | — | | | $14,250 | | | $606,435 | | |||
| | 2019 | | | $373,500 | | | $322,544 | | | $43,932 | | | $150,008 | | | $14,000 | | | $903,984 | |
| (1) | The amounts reported in the “Stock Awards” column reflect the fair value of restricted stock units |
| (2) | The amounts reported in the “Option Awards” column reflect the fair value on the grant date of the award. The total fair value of the option award is calculated in accordance with FASB ASC Topic 718. The amounts do not reflect the actual amount that may be realized by the executive officers. A discussion of the assumptions used in calculating these values is in Note |
| (3) |
| (4) | Represents personal use of company automobile, |
| Represents club fees and dues, automobile allowance, contribution to a medical reimbursement plan, |
| (6) | Represents club fees and dues, gross up for income taxes related to benefits of $12,392 and the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $8,788. |
| (7) | Represents the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $11,933. |
| (8) | Represents club fees and dues, automobile allowance of $14,356, gross up for income taxes related to benefits and the contribution to the Company’s Profit Sharing/ 401K Plan made by the Company of $9,664. |
| (9) | Represents the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $15,539. |
31
17
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash compensation as well as certain other compensation earned by the Company’s Named Executive Officers during the years ended December 31, 2018, 20172021, 2020 and 2016.2019. Such amounts do not reflect actual cash received by the Named Executive Officers in 2018, 20172021, 2020 or 2016.
Name and Principal Position | Year | Salary | Bonuses | Stock Awards(1) | Option Awards(2) | Change in Pension Value and Non-Qualified Deferred Compensation Earnings | All Other Compensation | Total | ||||||||||||||
Peter J. Gundermann, President and Chief Executive Officer | 2018 | $ | 549,270 | $ | 478,827 | $ | 70,633 | $ | 531,243 | $0(3) | $ | 100,378 | (4) | $ | 1,730,351 | |||||||
2017 | $ | 538,500 | $ | 223,209 | — | $ | 525,474 | $2,485,358(3) | $ | 65,331 | $ | 3,837,872 | ||||||||||
2016 | $ | 528,000 | $ | 637,288 | — | $ | 277,054 | $841,718(3) | $ | 116,965 | $ | 2,401,025 | ||||||||||
David C. Burney, Executive Vice President –Finance and Chief Financial Officer | 2018 | $ | 331,888 | $ | 236,221 | $ | 42,856 | $ | 128,421 | $0(3) | $ | 43,941 | (5) | $ | 783,327 | |||||||
2017 | $ | 325,380 | $ | 112,418 | — | $ | 126,873 | $603,282(3) | $ | 32,156 | $ | 1,200,109 | ||||||||||
2016 | $ | 319,000 | $ | 305,762 | — | $ | 83,729 | $451,419(3) | $ | 34,227 | $ | 1,194,137 | ||||||||||
James S. Kramer, Executive Vice President | 2018 | $ | 278,827 | $ | 218,952 | $ | 36,014 | $ | 107,806 | $0(3) | $ | 33,980 | (6) | $ | 675,579 | |||||||
2017 | $ | 273,360 | $ | 98,072 | — | $ | 106,693 | $476,199(3) | $ | 33,136 | $ | 987,460 | ||||||||||
2016 | $ | 268,000 | $ | 244,751 | — | $ | 70,317 | $286,096(3) | $ | 28,814 | $ | 897,978 | ||||||||||
James F. Mulato, Executive Vice President(7) | 2018 | $ | 332,194 | $ | 163,271 | $ | 85,134 | $ | 176,674 | — | $ | 49,895 | (8) | $ | 807,168 | |||||||
2017 | $ | 325,680 | $ | 91,272 | — | $ | 158,841 | — | $ | 49,434 | $ | 625,227 | ||||||||||
2016 | $ | 319,290 | $ | 289,759 | — | $ | 125,690 | — | $ | 48,096 | $ | 782,835 | ||||||||||
Mark A. Peabody, Executive Vice President | 2018 | $ | 366,231 | $ | 337,886 | $ | 47,145 | $ | 141,706 | $0(3) | $ | 14,126 | (9) | $ | 907,094 | |||||||
2017 | $ | 359,050 | $ | 276,047 | — | $ | 140,060 | $588,695(3) | $ | 13,500 | $ | 1,377,352 | ||||||||||
2016 | $ | 352,000 | $ | 388,039 | — | $ | 92,351 | $468,930(3) | $ | 13,250 | $ | 1,314,570 | ||||||||||
Amounts reflected under the “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” are primarily the result of a decrease from the prior year in the discount rate applied to calculate the present value of such benefits. No payments were made and no changes were made under the SERP or SERP II.
| | Name and Principal Position | | | Year | | | Salary | | | Bonuses | | | Stock Awards(1) | | | Option Awards(2) | | | Change in Pension Value and Non-Qualified Deferred Compensation Earnings(3) | | | All Other Compensation | | | Total | |
| | Peter J. Gundermann, President and Chief Executive Officer | | | 2021 | | | $571,460 | | | — | | | $217,230 | | | $1,600,279(4) | | | $— | | | $63,668(5) | | | $2,452,637 | |
| | 2020 | | | $571,460 | | | — | | | $200,346 | | | — | | | $1,953,301 | | | $59,410 | | | $2,784,517 | | |||
| | 2019 | | | $560,300 | | | $342,178 | | | $65,970 | | | $799,884 | | | $1,916,098 | | | $76,930 | | | $3,761,360 | | |||
| | | | | | | | | | | | | | �� | | | | | | ||||||||
| | David C. Burney, Executive Vice President – Finance and Chief Financial Officer | | | 2021 | | | $355,550 | | | — | | | $141,077 | | | $300,238(4) | | | $— | | | $40,445(6) | | | $837,310 | |
| | 2020 | | | $355,550 | | | — | | | $130,446 | | | — | | | $843,996 | | | $41,655 | | | $1,371,647 | | |||
| | 2019 | | | $343,500 | | | $237,272 | | | $39,827 | | | $150,008 | | | $952,705 | | | $55,929 | | | $1,779,241 | | |||
| | | | | | | | | | | | | | | | | | | |||||||||
| | James S. Kramer, Executive Vice President | | | 2021 | | | $292,932 | | | — | | | $128,754 | | | $300,238(4) | | | $— | | | $30,889(7) | | | $752,813 | |
| | 2020 | | | $292,932 | | | — | | | $120,109 | | | — | | | $648,629 | | | $33,677 | | | $1,095,347 | | |||
| | 2019 | | | $284,400 | | | $269,596 | | | $33,453 | | | $150,008 | | | $759,468 | | | $33,219 | | | $1,530,144 | | |||
| | | | | | | | | | | | | | | | | | | |||||||||
| | Michael C. Kuehn, Executive Vice President(8) | | | 2021 | | | $369,342 | | | — | | | $181,419 | | | $400,521(4) | | | — | | | $11,933(9) | | | $963,215 | |
| | 2020 | | | $369,342 | | | — | | | $170,319 | | | — | | | — | | | $14,250 | | | $553,911 | | |||
| | | | 2019 | | | $362,100 | | | $217,260 | | | $88,765 | | | $200,195 | | | — | | | $14,000 | | | $882,320 | | |
| | | | | | | | | | | | | | | | | | | |||||||||
| | James F. Mulato, Executive Vice President(10) | | | 2021 | | | $348,962 | | | — | | | $180,604 | | | $400,521(4) | | | — | | | $32,112(11) | | | $962,199 | |
| | 2020 | | | $348,962 | | | — | | | $170,319 | | | — | | | — | | | $131,605 | | | $650,886 | | |||
| | 2019 | | | $338,800 | | | $426,410 | | | $83,039 | | | $200,195 | | | — | | | $43,882 | | | $1,092,326 | | |||
| | | | | | | | | | | | | | | | | | | |||||||||
| | Mark A. Peabody, Executive Vice President and President of Aerospace Segment | | | 2021 | | | $480,970 | | | — | | | $174,589 | | | $300,238(4) | | | $17,278 | | | $16,035(12) | | | $989,110 | |
| | 2020 | | | $461,739 | | | — | | | $130,446 | | | — | | | $784,914 | | | $14,250 | | | $1,391,349 | | |||
| | 2019 | | | $373,500 | | | $322,544 | | | $43,932 | | | $150,008 | | | $895,920 | | | $14,000 | | | $1,799,904 | |
| (1) | The amounts reported in the “Stock Awards” column reflect the fair value of restricted stock units |
| (2) | The amounts reported in the “Option Awards” column reflect the fair value on the grant date of the award. The total fair value of the option award is calculated in accordance with FASB ASC Topic 718. The amounts do not reflect the actual amount that may be realized by the executive officers. A discussion of the assumptions used in calculating these values is in Note |
| (3) | Represents the annual change in the actuarial present value of accumulated benefits under |
| (4) |
| (5) | Represents personal use of company automobile, |
| Represents club fees and dues, automobile allowance, contribution to a medical reimbursement plan, |
| (7) | Represents club fees and dues, gross up for income taxes related to benefits of $12,392 and the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $8,788. |
| (8) | Mr. Kuehn is not a participant in the SERP or SERP II. |
32
18
EXECUTIVE COMPENSATION
| (9) | Represents the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $11,933. |
| (10) | Mr. Mulato is not a participant in the SERP or SERP II. |
| (11) | Represents club fees and dues, automobile allowance of $14,356, gross up for income taxes related to benefits and the contribution to the Company’s Profit Sharing/ 401K Plan made by the Company of $9,664. |
| (12) | Represents the contribution to the Company’s Profit Sharing/401K Plan made by the Company of $15,539. |
33
EXECUTIVE COMPENSATION
CEO Pay Ratio
In accordance with the final rule issued under Section 953(b) of the Dodd-Frank Act, companies, including Astronics Corporation, are now required to disclose the ratio of the total annual compensation of their CEO to that of their median employee. The new SEC rules require disclosure of (i) the median of the annual total compensation of all employees of Astronics Corporation, except the CEO, (ii) the annual total compensation of the CEO, and (iii) the ratio of the amount of the CEO to the amount of the median employee’s annual total compensation of all employees of Astronics Corporation. Because the SEC rules do not mandate a particular approach to determining the median employee, Astronics Corporation has employed the following approach:
Astronics Corporation elected to identify its median employee as of December 31, 2017.2020. The median employee was identified by calculating the total cash compensation granted in 20172020 to
all employees, excluding the CEO, employed as of December 31, 2017.2020. The fixed compensation of employees hired during the year or acquired through acquisition was annualized. As there were no material changes in the employee population or employee compensation arrangements in 20182021 that the Company reasonably believes would result in a significant change to its pay ratio disclosure, the Company has elected to use the same median employee for purposes of its pay ratio disclosure for 2018.2021. The ratio disclosed below was calculated using the annual total compensation of Mr. Gundermann and of the median employee for 2018.
2021.
As calculated using the methodology required for the Summary Compensation Table, the total annual compensation of Mr. Gundermann was $1,730,351$2,452,637 and the total annual compensation of the median employee was $60,696.$57,442. This yields a ratio of 28.5142.70 to 1.
19
34
EXECUTIVE COMPENSATION
The following table sets forth information with respect to plan-based awards granted in 20182021 to the executives named in the summary compensation table.
All options and RSUs were granted pursuant to the Company’s 2017 Long Term Incentive Plan.
Name | Grant Date(1) | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | All Other Stock Awards: Number of Securities Underlying Award(3) | Exercise or Base Price of Option Awards per share | Grant Date Fair Value of Stock and Option Awards(4) | ||||||||||||||||
Threshold (#) | Target (#) | Maximum (#) | |||||||||||||||||||
Peter J. Gundermann | |||||||||||||||||||||
Options | December 13, 2018 | 34,790 | $ | 31.57 | $ | 531,243 | |||||||||||||||
RSUs | March 1, 2018 | 1,556 | 2,075 | 2,387 | $ | 70,633 | |||||||||||||||
David C. Burney | |||||||||||||||||||||
Options | December 13, 2018 | 8,410 | $ | 31.57 | $ | 128,421 | |||||||||||||||
RSUs | March 1, 2018 | 944 | 1,259 | 1,449 | $ | 42,856 | |||||||||||||||
James S. Kramer | |||||||||||||||||||||
Options | December 13, 2018 | 7,060 | $ | 31.57 | $ | 107,806 | |||||||||||||||
RSUs | March 1, 2018 | 794 | 1,058 | 1,217 | $ | 36,014 | |||||||||||||||
James F. Mulato | |||||||||||||||||||||
Options | December 13, 2018 | 11,570 | $ | 31.57 | $ | 176,674 | |||||||||||||||
RSUs | March 1, 2018 | 1,876 | 2,501 | 2,877 | $ | 85,134 | |||||||||||||||
Mark A. Peabody | |||||||||||||||||||||
Options | December 13, 2018 | 9,280 | $ | 31.57 | $ | 141,706 | |||||||||||||||
RSUs | March 1, 2018 | 1,038 | 1,385 | 1,594 | $ | 47,145 | |||||||||||||||
| | Name | | | Grant Date(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards (2) | | | All Other Stock Awards: Number of Shares of Stock(3) | | | All Other Option Awards: Number of Securities Underlying Award(4) | | | Exercise or Base Price of Option Awards per share | | | Grant Date Fair Value of Stock and Option Awards(5) | | ||||||
| | Threshold (#) | | | Target (#) | | | Maximum (#) | | ||||||||||||||||||
| | Peter J. Gundermann | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 98,900 | | | $14.45 | | | $800,101 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 115,800 | | | $11.13 | | | $800,178 | | |||||
| | RSUs | | | February 26, 2021 | | | 9,207 | | | 12,275 | | | 14,117 | | | | | | | | | $200,083 | | |||
| | | | February 26, 2021 | | | | | | | | | 1,052 | | | | | | | $17,148 | | ||||||
| | David C. Burney | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 20,250 | | | $14.45 | | | $150,053 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 24,500 | | | $11.13 | | | $150,185 | | |||||
| | RSUs | | | February 26, 2021 | | | 6,000 | | | 8,000 | | | 9,200 | | | | | | | | | $130,400 | | |||
| | | | February 26, 2021 | | | | | | | | | 655 | | | | | | | $10,677 | | ||||||
| | James S. Kramer | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 20,250 | | | $14.45 | | | $150,053 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 24,500 | | | $11.13 | | | $150,185 | | |||||
| | RSUs | | | February 26, 2021 | | | 5,532 | | | 7,375 | | | 8,482 | | | | | | | | | $120,213 | | |||
| | | | February 26, 2021 | | | | | | | | | 524 | | | | | | | $8,541 | | ||||||
| | Michael C. Kuehn | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 27,000 | | | $14.45 | | | $200,070 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 32,700 | | | $11.13 | | | $200,451 | | |||||
| | RSUs | | | February 26, 2021 | | | 7,838 | | | 10,450 | | | 12,018 | | | | | | | | | $170,335 | | |||
| | | | February 26, 2021 | | | | | | | | | 680 | | | | | | | $11,084 | | ||||||
| | James F. Mulato | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 27,000 | | | $14.45 | | | $200,070 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 32,700 | | | $11.13 | | | $200,451 | | |||||
| | RSUs | | | February 26, 2021 | | | 7,838 | | | 10,450 | | | 12,018 | | | | | | | | | $170,335 | | |||
| | | | February 26, 2021 | | | | | | | | | 630 | | | | | | | $10,269 | | ||||||
| | Mark A. Peabody | | | | | | | | | | | | | | | | | | ||||||||
| | Options | | | January 22, 2021 | | | | | | | | | | | 20,250 | | | $14.45 | | | $150,053 | | ||||
| | | | December 9, 2021 | | | | | | | | | | | 24,500 | | | $11.13 | | | $150,185 | | |||||
| | RSUs | | | February 26, 2021 | | | 7,369 | | | 9,825 | | | 11,299 | | | | | | | | | $160,148 | | |||
| | | | February 26, 2021 | | | | | | | | | 886 | | | | | | | $14,442 | | ||||||
| (1) | The grant date is the date the Compensation Committee of the Board of Directors meets to approve the awards. |
| (2) | Represents the potential payout range related to Restricted Stock Units awarded to NEOs, subject to achievement of performance targets. The RSUs are earned based upon the Company’s mathematical average annual Adjusted EBITDA for the period beginning January 1, |
| (3) | The amounts shown represent the number of time-based RSUs |
| Represents the number of shares of |
| Represents the full grant date fair value calculated in accordance with FASB ASC Topic 718. The amounts do not reflect the actual amounts that may be realized by the executive officers. Assumptions used to calculate these amounts are included in Note |
35
20
EXECUTIVE COMPENSATION
Outstanding Equity Awards at Fiscal Year-End
The following table sets forth information with respect to the executives named in the summary compensation table relating to unexercised stock options, stock that has not vested, and
equity incentive plan awards outstanding as of December 31, 2018:
Options(1) | Restricted Stock Units | |||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units That Have Not Vested | 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 | ||||||||||||||||||
Peter J. Gundermann President and Chief Executive Officer | 37,480 | — | $ | 2.84 | December 3, 2019 | 2,075 | $ | 70,633 | ||||||||||||||||||
66,355 | — | 2.84 | December 3, 2019 | |||||||||||||||||||||||
14,700 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
26,025 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
10,700 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
16,249 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
18,700 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
22,254 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
8,300 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
6,848 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
8,080 | 2,020 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
4,209 | 1,052 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
8,220 | 5,480 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
2,651 | 1,767 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
5,784 | 8,676 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
868 | 1,301 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
5,260 | 21,040 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
789 | 3,156 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
— | 34,790 | 31.57 | December 13, 2028 | |||||||||||||||||||||||
David C. Burney, Executive Vice President- Finance And Chief Financial Officer | 12,710 | — | $ | 2.84 | December 3, 2019 | 1,259 | $ | 42,856 | ||||||||||||||||||
22,502 | — | 2.84 | December 3, 2019 | |||||||||||||||||||||||
5,000 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
8,852 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
3,600 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
5,467 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
6,400 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
7,616 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
2,600 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
2,145 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
2,520 | 630 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
1,313 | 328 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
2,460 | 1,640 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
793 | 529 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
1,748 | 2,622 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
262 | 394 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
1,270 | 5,080 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
191 | 762 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
— | 8,410 | 31.57 | December 13, 2028 | |||||||||||||||||||||||
2021:
21
| | | | Options(1) | | | Restricted Stock Units | | |||||||||||||||||||
| | Name | | | Number of Securities Underlying Unexercised Options Exercisable | | | Number of Securities Underlying Unexercised Options Unexercisable | | | Option Exercise Price | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested | | | Market Value of Shares or Units That Have Not Vested | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested | |
| | Peter J. Gundermann, President and Chief Executive Officer | | | 18,700 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 1,832(2) | | | $21,984 | | ||
| | 22,254 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 10,175(3) | | | $122,100 | | |||||
| | 8,300 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 12,275(4) | | | $147,300 | | |||||
| | 6,848 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 1,052(5) | | | $12,624 | | |||||
| | 10,100 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 5,261 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 13,700 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 4,418 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 14,460 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 2,169 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 21,040 | | | 5,260 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 3,156 | | | 789 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 20,874 | | | 13,916 | | | $31.57 | | | December 13, 2028 | | | | | | | | | | |||||||
| | 24,480 | | | 36,720 | | | $30.04 | | | December 9, 2029 | | | | | | | | | | |||||||
| | — | | | 98,900 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 115,800 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
| | David C. Burney, Executive Vice President— Finance and Chief Financial Officer | | | 6,400 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 1,106 (2) | | | $13,272 | | ||
| | 7,616 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 6,625 (3) | | | $79,500 | | |||||
| | 2,600 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 8,000 (4) | | | $96,000 | | |||||
| | 2,145 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 655(5) | | | $7,860 | | |||||
| | 3,150 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 1,641 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 4,100 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 1,322 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 4,370 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 656 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 5,080 | | | 1,270 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 762 | | | 191 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 5,046 | | | 3,364 | | | $31.57 | | | December 13, 2028 | | | | | | | | | | |||||||
| | 5,440 | | | 8,160 | | | $30.04 | | | December 9, 2029 | | | | | | | | | | |||||||
| | — | | | 20,250 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 24,500 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
| | James S. Kramer, Executive Vice President | | | 5,700 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 929(2) | | | $11,148 | | ||
| | 6,784 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 6,100(3) | | | $73,200 | | |||||
| | 2,330 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 7,375(4) | | | $88,500 | | |||||
| | 1,923 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 524(5) | | | $6,288 | | |||||
| | 2,720 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 1,417 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 3,500 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 1,129 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 3,670 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 551 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 4,272 | | | 1,068 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 641 | | | 160 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 4,236 | | | 2,824 | | | $31.57 | | | December 13, 2028 | | | | | | | | | | |||||||
| | 5,440 | | | 8,160 | | | $30.04 | | | December 9, 2029 | | | | | | | | | | |||||||
| | — | | | 20,250 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 24,500 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
36
EXECUTIVE COMPENSATION
Options(1) | Restricted Stock Units | |||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units That Have Not Vested | 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 | ||||||||||||||||||
James S. Kramer, Executive Vice President | 11,750 | — | $ | 2.84 | December 3, 2019 | 1,058 | $ | 36,014 | ||||||||||||||||||
20,803 | — | 2.84 | December 3, 2019 | |||||||||||||||||||||||
4,350 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
7,701 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
3,200 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
4,859 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
5,700 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
6,784 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
2,330 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
1,923 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
2,176 | 544 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
1,134 | 283 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
2,100 | 1,400 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
677 | 452 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
1,468 | 2,202 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
220 | 331 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
1,068 | 4,272 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
160 | 641 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
— | 7,060 | 31.57 | December 13, 2028 | |||||||||||||||||||||||
James F Mulato, Executive Vice President | 1,920 | 480 | $ | 34.75 | March 31, 2024 | 2,501 | $ | 85,134 | ||||||||||||||||||
1,584 | 396 | 34.75 | March 31, 2024 | |||||||||||||||||||||||
2,640 | 660 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
1,375 | 344 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
2,580 | 1,720 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
832 | 555 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
2,624 | 3,936 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
394 | 590 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
1,590 | 6,360 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
239 | 954 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
— | 11,570 | 31.57 | December 13, 2028 | |||||||||||||||||||||||
Mark A. Peabody, Executive Vice President | 16,840 | — | $ | 2.84 | December 3, 2019 | 1,385 | $ | 47,145 | ||||||||||||||||||
29,814 | — | 2.84 | December 3, 2019 | |||||||||||||||||||||||
6,500 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
11,508 | — | 7.68 | December 2, 2020 | |||||||||||||||||||||||
4,300 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
6,530 | — | 13.59 | December 1, 2021 | |||||||||||||||||||||||
7,400 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
8,807 | — | 9.20 | November 29, 2022 | |||||||||||||||||||||||
2,990 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
2,467 | — | 28.45 | December 11, 2023 | |||||||||||||||||||||||
2,776 | 694 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
1,446 | 361 | 30.83 | December 11, 2024 | |||||||||||||||||||||||
2,700 | 1,800 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
871 | 580 | 27.72 | December 3, 2025 | |||||||||||||||||||||||
1,928 | 2,892 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
289 | 434 | 31.76 | December 14, 2026 | |||||||||||||||||||||||
1,402 | 5,608 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
210 | 842 | 35.61 | December 12, 2027 | |||||||||||||||||||||||
— | 9,280 | 31.57 | December 13, 2028 | |||||||||||||||||||||||
| | | | Options(1) | | | Restricted Stock Units | | |||||||||||||||||||
| | Name | | | Number of Securities Underlying Unexercised Options Exercisable | | | Number of Securities Underlying Unexercised Options Unexercisable | | | Option Exercise Price | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested | | | Market Value of Shares or Units That Have Not Vested | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested | |
| | Michael C. Kuehn, Executive Vice President | | | 6,440 | | | 1,610 | | | $35.61 | | | December 12, 2027 | | | | | | | 2,465(2) | | | $29,580 | | ||
| | 966 | | | 242 | | | $35.61 | | | December 12, 2027 | | | | | | | 8,650(3) | | | $103,800 | | |||||
| | 7,416 | | | 4,944 | | | $31.57 | | | December 13, 2028 | | | | | | | 10,450(4) | | | $125,400 | | |||||
| | 7,260 | | | 10,890 | | | $30.04 | | | December 9, 2029 | | | | | | | 680(5) | | | $8,160 | | |||||
| | — | | | 27,000 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 32,700 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
| | James F Mulato, Executive Vice President | | | 2,400 | | | — | | | $34.75 | | | March 31, 2024 | | | | | | | 2,306(2) | | | $27,672 | | ||
| | 1,980 | | | — | | | $34.75 | | | March 31, 2024 | | | | | | | 8,650(3) | | | $103,800 | | |||||
| | 3,300 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | 10,450(4) | | | $125,400 | | |||||
| | 1,719 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | 630(5) | | | $7,560 | | |||||
| | 4,300 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 1,387 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 6,560 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 984 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 6,360 | | | 1,590 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 954 | | | 239 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 6,942 | | | 4,628 | | | $31.57 | | | December 13, 2028 | | | | | | | | | | |||||||
| | 7,260 | | | 10,890 | | | $30.04 | | | December 9, 2029 | | | | | | | | | | |||||||
| | — | | | 27,000 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 32,700 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
| | Mark A. Peabody, Executive Vice President | | | 7,400 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 1,220(2) | | | $14,640 | | ||
| | 8,807 | | | — | | | $9.20 | | | November 29, 2022 | | | | | | | 6,625(3) | | | $79,500 | | |||||
| | 2,990 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 9,825(4) | | | $117,900 | | |||||
| | 2,467 | | | — | | | $28.45 | | | December 11, 2023 | | | | | | | 886(5) | | | $10,632 | | |||||
| | 3,470 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 1,807 | | | — | | | $30.83 | | | December 11, 2024 | | | | | | | | | | |||||||
| | 4,500 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 1,451 | | | — | | | $27.72 | | | December 3, 2025 | | | | | | | | | | |||||||
| | 4,820 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 723 | | | — | | | $31.76 | | | December 14, 2026 | | | | | | | | | | |||||||
| | 5,608 | | | 1,402 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 842 | | | 210 | | | $35.61 | | | December 12, 2027 | | | | | | | | | | |||||||
| | 5,568 | | | 3,712 | | | $31.57 | | | December 13, 2028 | | | | | | | | | | |||||||
| | 5,440 | | | 8,160 | | | $30.04 | | | December 9, 2029 | | | | | | | | | | |||||||
| | — | | | 20,250 | | | $14.45 | | | January 22, 2031 | | | | | | | | | | |||||||
| | — | | | 24,500 | | | $11.13 | | | December 9, 2031 | | | | | | | | | | |||||||
| (1) |
| (2) | Reflects RSUs to be |
| (3) | Reflects RSUs to be earned at the target award level under the award agreements. The award earned will be adjusted based upon the Company’s mathematical average annual Adjusted EBITDA for the period beginning January 1, 2020 and ending December 31, 2022. All RSUs cliff vest on December 31, 2022. |
| (4) | Reflects RSUs to be earned at the target award level under the award agreements. The award earned will be adjusted based upon the Company’s mathematical average annual Adjusted EBITDA for the period beginning January 1, 2021 and ending December 31, 2023. All RSUs cliff vest on December 31, 2023. |
| (5) | Reflects RSUs to awarded in lieu of raises for 2021, which vest in equal increments over a three-year period. |
37
22
EXECUTIVE COMPENSATION
Options
Option Exercises and Stock Vested
The following table sets forth information with respect to the executives named in the summary compensation table relating to the exercise of stock options, stock appreciation rights and
similar rights, and the vesting of stock in connection therewith, in 2018:
Option Awards | ||||||
Name | Number of Shares Acquired on Exercise | Value Realized on Exercise | ||||
Peter J. Gundermann, President and Chief Executive Officer | 100,095 | $ | 2,904,757 | |||
David C. Burney, Executive Vice President – Finance and Chief Financial Officer | 35,157 | $ | 1,020,257 | |||
James S. Kramer, Executive Vice President | 28,427 | $ | 1,056,063 | |||
James F. Mulato, Executive Vice President | — | — | ||||
Mark A. Peabody, Executive Vice President | 46,765 | $ | 1,350,106 | |||
2021:
Pension Benefits at December 31, 2018:
Name | Plan Name | Number of Years Credited Service | Present Value of Accumulated Benefit ($) | Payment During Last Fiscal Year ($) | ||||||
Peter J. Gundermann, President and Chief Executive Officer | Astronics Corporation Supplemental Retirement Plan (SERP) | 31 | $ | 7,788,726 | — | |||||
SERP-Retiree Medical, Dental and Long-Term Care | 31 | $ | 388,677 | — | ||||||
David C. Burney, Executive Vice President – Finance and Chief Financial Officer | Astronics Corporation Supplemental Retirement Plan II (SERP II) | 22 | $ | 3,457,494 | — | |||||
James S. Kramer, Executive Vice President | Astronics Corporation Supplemental Retirement Plan II (SERP II) | 30 | $ | 2,759,973 | — | |||||
James F. Mulato, Executive Vice President | — | — | — | — | ||||||
Mark A. Peabody, Executive Vice President | Astronics Corporation Supplemental Retirement Plan II (SERP II) | 13 | $ | 3,690,050 | — | |||||
Option Awards Stock Awards Name Number of SharesAcquired on Exercise Value Realizedon Exercise(1) Number of SharesAcquired on Vesting Value Realizedon Vesting Peter J. Gundermann,President and Chief Executive Officer 16,249 — 2,075 $38,699 David C. Burney,Executive Vice President – Finance and Chief Financial Officer — — 1,259 $23,480 James S. Kramer,Executive Vice President — — 1,058 $19,732 Michael C. Kuehn,Executive Vice President — — — — James F. Mulato,Executive Vice President. — — 2,501 $46,644 Mark A. Peabody,Executive Vice President — — 1,385 $25,830
| (1) | The exercise price of Mr. Gundermann’s option was higher than the fair market value on the date of exercise. As such, Mr. Gundermann’s value realized on exercise was ($50,859). |
| | Name | | | Plan Name | | | Number of Years Credited Service | | | Present Value of Accumulated Benefit ($) | | | Payment During Last Fiscal Year ($) | |
| | Peter J. Gundermann, President and Chief Executive Officer | | | Astronics Corporation Supplemental Retirement Plan (SERP) | | | 34 | | | $11,214,515 | | | — | |
| | | | SERP-Retiree Medical, Dental and Long-Term Care | | | 34 | | | $ 494,159 | | | — | | |
| | David C. Burney, Executive Vice President – Finance and Chief Financial Officer | | | Astronics Corporation Supplemental Retirement Plan II (SERP II) | | | 25 | | | $5,123,923 | | | — | |
| | | | | | | | | | | |||||
| | James S. Kramer, Executive Vice President | | | Astronics Corporation Supplemental Retirement Plan II (SERP II) | | | 33 | | | $4,014,789 | | | — | |
| | | | | | | | | | | |||||
| | Michael C. Kuehn, Executive Vice President | | | — | | | — | | | — | | | — | |
| | | | | | | | | | | |||||
| | James F. Mulato, Executive Vice President | | | — | | | — | | | — | | | — | |
| | | | | | | | | | | |||||
| | Mark A. Peabody, Executive Vice President | | | Astronics Corporation Supplemental Retirement Plan II (SERP II) | | | 16 | | | $5,388,162 | | | — | |
The Company has two non-qualified supplemental retirement defined benefit plans for certain executives - the Supplemental Retirement Plan (“SERP”) and Supplemental Retirement Plan II (“SERP II”).
The SERP targets a retirement benefit based on 65% of the average of the highest consecutive three-year cash compensation.compensation, less a participant’s primary Social Security benefit at age 65 and the actuarially determined value of certain contributions made by Astronics to its tax-qualified defined contribution plan on
behalf of the participant. The plan is unfunded and has no assets. Except as described below under “Other Potential Post-Employment Benefits”, SERP benefits are payable only to “retirement-eligible” participants, i.e., employees designated to participate in the SERP and each of whom, upon termination of employment, has at least 10 years of continuous service with the Company and (i) has attained age 65, or (ii) has
attained age 60 or later with a combined total of age and years of service equal to 90. As of December 31, 2018,2021, Peter J. Gundermann was the only non-retired participant in the SERP.
38
EXECUTIVE COMPENSATION
SERP II was adopted in March 2012. The SERP II targets a retirement benefit based on 50% of the average of the highest consecutive three-year cash compensation. SERP II is unfunded and has no assets. Except as described below under “Other Potential Post-Employment Benefits”, the SERP II benefits are generally payable only to “retirement-eligible” participants, i.e., employees designated to participate in the SERP II and each of whom, upon termination of employment, has at least 10 years of continuous service with the Company and (i) has attained age 65, or (ii) has attained age 60 or later with a
23
EXECUTIVE COMPENSATION
combined total of age and years of service equal to 90. As of December 31, 2018,2021, David C. Burney, James S. Kramer and Mark A. Peabody were the only participants in the SERP II.
The assumptions used to calculate the benefit obligation for the SERP and SERP II are: discount rate 4.20%2.75%, future average compensation increases of 3% for 2022 and 2.00%. thereafter. The present value of the accumulated benefit is an actuarial calculation that assumes that the plan will remain in force and that participants will remain employed by the Company until age 65 with not less than 10 years of service (as defined) or until age 60 or later with a combined total of age and years of service equal to 90.
The assumptions used to calculate the benefit obligation for the SERP-Retiree Medical, Dental and Long-Term Care are: discount rate 4.20%2.75%, future average healthcare benefit increases to 5.20%6.10% for 20192022 and then gradually decreasing to 4.66%4.65% in
2070. The present value of the accumulated benefit is an actuarial calculation that assumes that the plan will remain in force and that participants will remain employed by the Company until age 65 with not less than 10 years of service (as defined) or until age 60 or later with a combined total of age and years of service equal to 90.
For purposes of illustration, the following tables show the estimated amounts of annual retirement income that would be payable at the present time under various assumptions as to compensation and years of service to employees who participate in the SERP and SERP II. The amounts presented with respect to the SERP are subject to reduction for Social Security benefits and for profitfor-profit sharing benefits earned under the Company’s Profit Sharing/401k Plan. A discount factor applies for retirement-eligible participants who start to receive benefits before attaining age 65.
ESTIMATED UNFUNDED SUPPLEMENTAL RETIREMENT PLAN (SERP) TABLE Years of ServiceThree Year Average Cash Compensation1015202530500,000250,000275,000300,000325,000325,000700,000350,000385,000420,000455,000455,000900,000450,000495,000540,000585,000585,0001,100,000550,000605,000660,000715,000715,0001,300,000650,000715,000780,000845,000845,000 Years of Service Three Year Average Cash Compensation 10 15 20 25 30 500,000 250,000 275,000 300,000 325,000 325,000 700,000 350,000 385,000 420,000 455,000 455,000 900,000 450,000 495,000 540,000 585,000 585,000 1,100,000 550,000 605,000 660,000 715,000 715,000 1,300,000 650,000 715,000 780,000 845,000 845,000
ESTIMATED UNFUNDED SUPPLEMENTAL RETIREMENT PLAN (SERP II) TABLE
Years of Service | |||||
Three Year Average Cash Compensation | 10 | 15 | 20 | 25 | 30 |
300,000 | 105,000 | 120,000 | 135,000 | 150,000 | 150,000 |
400,000 | 140,000 | 160,000 | 180,000 | 200,000 | 200,000 |
450,000 | 157,500 | 180,000 | 202,500 | 225,000 | 225,000 |
500,000 | 175,000 | 200,000 | 225,000 | 250,000 | 250,000 |
600,000 | 210,000 | 240,000 | 270,000 | 300,000 | 300,000 |
700,000 | 245,000 | 280,000 | 315,000 | 350,000 | 350,000 |
800,000 | 280,000 | 320,000 | 360,000 | 400,000 | 400,000 |
| | | | Years of Service | | |||||||||||||
| | Three Year Average Cash Compensation | | | 10 | | | 15 | | | 20 | | | 25 | | | 30 | |
| | 300,000 | | | 105,000 | | | 120,000 | | | 135,000 | | | 150,000 | | | 150,000 | |
| | 400,000 | | | 140,000 | | | 160,000 | | | 180,000 | | | 200,000 | | | 200,000 | |
| | 450,000 | | | 157,500 | | | 180,000 | | | 202,500 | | | 225,000 | | | 225,000 | |
| | 500,000 | | | 175,000 | | | 200,000 | | | 225,000 | | | 250,000 | | | 250,000 | |
| | 600,000 | | | 210,000 | | | 240,000 | | | 270,000 | | | 300,000 | | | 300,000 | |
| | 700,000 | | | 245,000 | | | 280,000 | | | 315,000 | | | 350,000 | | | 350,000 | |
| | 800,000 | | | 280,000 | | | 320,000 | | | 360,000 | | | 400,000 | | | 400,000 | |
Non-Qualified Deferred Compensation
The Company does not have any non–qualified defined contribution or other plan that provides for the deferral of compensation.
24
39
EXECUTIVE COMPENSATION
Other Potential Post-Employment Payments
The Company has entered into an Employment Termination Benefits Agreement with each of Messrs. Gundermann, Burney, Kramer and Peabody. In addition, as described in the “Pension Benefits” section beginning on page 2338 above, Mr. Gundermann is a participant in the SERP while Messrs.
Burney, Kramer, and Peabody are each participants in SERP II. The Company has not entered into an Employment Termination Benefits Agreement with Mr. Kuehn or Mr. Mulato. Neither Mr.Messrs. Kuehn nor Mr. Mulato is a participant in either the SERP or SERP II.
In the event Mr. Gundermann’s employment is terminated within two years following a “Change of Control”, he would be entitled to (i) salary continuation for two years in an annual amount equal to his current annual base salary or, alternatively,if greater, his average total cash compensation for the two calendar years preceding the termination date, (ii) continuation for two years of health, life and disability insurance coverage, (iii) continued use for two years of automobile or reimbursement of automobile expenses, (iv) continued club membership dues for two years, and (v) vesting of any outstanding stock options, which are exercisable for one year or, if shorter, until the expiration date, provided that Mr. Gundermann may elect to receive the option bargain element in cash. Other than benefits that are generally available to the Company’s salaried employees, the Employment Termination Benefits Agreement with Mr. Gundermann does not entitle him to any additional benefits upon a termination of employment in any other circumstances.
For purposes of the Employment Termination Benefits Agreements, a “Change of Control” generally means the transfer in one or more transactions, extending over a period of not more than 24 months, of Common Stock and Class B Stock of the Company possessing 25% or more of the total combined voting power of all of the Company’s Common Stock and Class B Stock.
In the event Messrs. Burney, Kramer or Peabody’s employment terminates within two years following a Change of Control, each executive would be entitled to (i) salary continuation for
one year in an annual amount equal to his current annual base salary or, alternatively,if greater, his average total cash compensation for the two calendar years preceding the termination date, (ii) continuation for one year of health life and disability insurance coverage, (iii) continued use for one year of automobile or reimbursement of automobile expenses, (iv) continued club membership dues for one year, and (v) vesting of any outstanding stock options, which are exercisable for one year or, if shorter, until the expiration date, provided that each executive may elect to receive the option bargain element in cash. Other than benefits that are generally available to the Company’s salaried employees, the Employment Termination Benefits Agreements do not entitle the executives to any additional benefits upon a termination of employment in any other circumstances.
The Company has not entered into an Employment Termination Benefits Agreement with Mr. Kuehn or Mr. Mulato.
In the case of an executive’s termination within two years following a Change of Control, each of the Employment Termination Benefits Agreements condition benefits on an executive refraining from competing with the Company during the period benefits are payable to him. If an executive violates the noncompetition covenant, benefits are suspended during the period the executive is in violation of the noncompetition covenant.
In the past, the Company has also paid severance benefits to salaried employees upon termination of employment. The eligibility for such payments and the amount thereof, has been determined by the Company on a case by casecase-by-case basis.
SERP & SERP II
Mr. Gundermann is a participant in the SERP. Under the terms of the SERP, eligible participants with at least 10 years of continuous service with the Company become 100% vested in and eligible for benefits in the event of an Involuntary Termination (as described below) or a termination upon a Change of Control (as described below). A participant who terminates employment on account of death or Disability (as defined in the Company’s tax-qualified defined contribution plan) will also become 100% vested in and eligible for benefits under the SERP. Upon a separation of service due to Involuntary Termination, a participant with at least 10 years of continuous service with the Company will receive a supplemental benefit based upon his or her highest consecutive
three-year average cash compensation paid prior to termination of employment. Upon a separation from service due to a termination upon a Change of Control, a participant with at least 10 years of continuous service with the Company will receive a supplemental benefit
determined based on the participant’s years of service as of the termination date and using the greater of (A) the highest consecutive three-year average cash compensation paid prior to the Change of Control, or (B) the average of the highest consecutive three-year average cash compensation paid prior to termination of employment. In each case,all cases, the supplemental benefit is subject to adjustment if the payment of the supplemental benefit commences prior to the participant attaining age 65.
40
EXECUTIVE COMPENSATION
During the period a participant or his spouse is receiving SERP benefits, the participant and his spouse are entitled to continuing medical, dental and long-term care coverage under the corresponding plan made available to the Company’s current officers (or an equivalent arrangement).
25
EXECUTIVE COMPENSATION
Under the terms of the SERP, benefits do not commence until the later of the participant’s termination of employment or the date the participant attains (or would have attained) age 60, when SERP benefits are paid as a monthly life annuity or, if a participant is married, as a joint and 100% survivor annuity. Accordingly, if Mr. Gundermann’s employment had terminated on December 31, 2018,2021, any vested SERP benefits would not commence until Mr. Gundermann’s attainment of age 60. If Mr. Gundermann’s employment were to terminate on account of his death, his surviving spouse, if any, would be entitled to a monthly survivor annuity for the remainder of the spouse’s lifetime in the same monthly amount that would have been paid to Mr. Gundermann. The actuarially estimated present value of continued medical, dental, and long-term care coverage is $388,677.
$494,159.
Messrs. Burney, Kramer and Peabody are participants in SERP II. The SERP II benefits generally are payable only to “retirement-eligible” participants, i.e., employees designated to participate in the SERP II and each of whom, upon termination of employment, has at least 10 years of continuous service with the Company and (i) has attained age 65, or (ii) has attained age 60 or later with a combined total of age and years of service equal to 90. However, if a participant’s employment terminates on account of his or her death or Disability (as defined in the Company’s qualified 401(k) retirement plan), the participant becomes 100% vested in his or her SERP II benefit. In the event of a 409A Change in Control Event, a participant with at least ten years of continuous service becomes 100% vested in his or her SERP II benefit. Furthermore, in the event of a participant’s Involuntary Termination or a Termination on a Change of Control, a participant with at least ten10 years of continuous service will become 100% vested in his or her SERP II benefit.
In general, SERP II benefits do not commence until the later of the participant’s termination of employment or the date the participant attains (or would have attained) age 60, when a participant’s SERP II benefit is paid to him or his surviving spouse as a monthly life annuity. However, SERP II provides that upon the occurrence of a 409A Change in Control Event (as described below) a participant with at least 10 years of consecutive service with the Company will be entitled to a lump sum payment of the present value of his or her supplemental benefit determined as of the date of the 409A Change in Control Event. For a participant who has not yet commenced payment of his or her supplemental benefit, the supplemental benefit will be determined based on the participant’s years of service as of the 409A Change in Control Event and using the average of the highest consecutive three-year cash compensation paid prior to the 409A Change
in Control Event, instead of the average for the pay paid prior to retirement. A participant who has already commenced
receiving payment of the supplemental benefit at the time of the 409A Change in Control Event will be entitled to a lump sum payment of the present value of the remaining supplemental benefit determined as of the 409A Change in Control Event.
Except in the case of a Termination on a Change of Control, both SERP and SERP II benefits are contingent on a participant not competing with the Company for the longer of three years after retirement or attainment of age 65. If a participant violates the noncompetition covenant, benefits are suspended during the period the participant is in violation of noncompetition covenant.
For purposes of the SERP and SERP II, (i) a “Change of Control” means the transfer, in one or more transactions extending over a period of not more than 24 months, of common stock of the Company possessing 25% or more of the total voting power of all shares of common stock, where a transfer shall be deemed to occur if shares of common stock are either transferred or made the subject of options, warrants, or similar rights granting a third party the opportunity to acquire ownership or voting control of such common stock and (ii) an “Involuntary Termination” means a termination of a participant’s employment relationship with the Company, other than for death, disability, retirement, or cause, (A) by or at the instigation of the Company, or (B) by or at the instigation of the participant where the participant’s compensation has been diminished or reduced to a greater extent than any diminution or reduction of the Company’s officers generally.
For purposes of SERP II, a “409A Change in Control Event” means the occurrence of one of the following events constituting a “change in control event” within the meaning of Code Section 409A:
| (i) | Any one person, or more than one person acting as a group (“Group”), acquires ownership of stock of the Company that, together with stock previously held by the acquirer, constitutes more than 80% of the total fair market value or total voting power of the Company’s stock. If any one person or Group is considered to own more than 80% of the total fair market value or total voting power of the Company’s stock, the acquisition of additional stock by the same person or Group does not cause a change in ownership; or |
| (ii) | A majority of the members of the Company’s Board of Directors is replaced during any 12-month (or shorter) period by directors whose appointment or election is not endorsed by a majority of the members of the Board of the Directors before the date of the appointment or election. |
41
26
EXECUTIVE COMPENSATION
The following table shows potential payments to Messrs. Gundermann, Burney, Kramer and Peabody under the Employment Termination Benefits Agreements, SERP and SERP II upon death, disability, involuntary termination, involuntary termination following a Change of Control, occurrence of a 409A Change in Control Event, and termination
following a 409A Change in Control Event. The amounts shown assume that the termination was effective December 31, 2018,2021, the last business day of the Company’s most recent fiscal year end. The actual amounts to be paid can only be determined at the actual time of a participant’s termination.
NameType of PaymentDeathDisabilityInvoluntary
TerminationTermination
on Change
of Control409A
Change in
Control EventTermination
on 409A
Change in
Control EventPeter J. GundermannSalary Continuation(1) — — — $1,098,541 — $1,098,541 Insurance Coverage(2) — — — $44,000 — $44,000 Club Membership(3) — — — $12,000 — $12,000 Automobile(3) — — — $42,000 — $42,000 Option Vesting(4) — — — $19,784 — $19,784 SERP Distribution(5)$7,578,000 $10,200,000 $6,061,000 $7,140,000 — — Total$7,578,000 $10,200,000 $6,061,000 $8,356,325 — $1,216,325 David C. BurneySalary Continuation(1) — — — $331,888 — $331,888 Insurance Coverage(2) — — — $22,000 — $22,000 Club Membership(3) — — — $9,948 — $9,948 Automobile(3) — — — $6,500 — $6,500 Option Vesting(4) — — — $5,921 — $5,921 SERP II Distribution(5)$3,392,000 $4,614,000 $2,691,000 $3,230,000 $4,994,000 $4,994,000 Total$3,392,000 $4,614,000 $2,691,000 $3,606,257 $4,994,000 $5,370,257 James S. KramerSalary Continuation(1) — — — $278,827 — $278,827 Insurance Coverage(2) — — — $21,000 — $21,000 Club Membership(3) — — — $8,887 — $8,887 Automobile(3) — — — — — — Option Vesting(4) — — — $5,056 — $5,056 SERP II Distribution(5)$2,590,000 $3,602,000 $2,017,000 $2,521,000 $4,341,000 $4,341,000 Total$2,590,000 $3,602,000 $2,017,000 $2,834,770 $4,341,000 $4,654,770 Mark A. PeabodySalary Continuation(1) — — — $366,231 — $366,231 Insurance Coverage(2) — — — $27,000 — $27,000 Club Membership(3) — — — — — — Automobile(3) — — — — — — Option Vesting(4) — — — $6,497 — $6,497 SERP II Distribution(5)$3,980,000 $5,162,000 $3,150,000 $3,614,000 $4,740,000 $4,740,000 Total$3,980,000 $5,162,000 $3,150,000 $4,013,728 $4,740,000 $5,139,728
| | Name | | | Type of Payment | | | Death | | | Disability | | | Involuntary Termination | | | Termination on Change of Control | | | 409A Change in Control Event | | | Termination on 409A Change in Control Event | |
| | Peter J. Gundermann | | | Salary Continuation(1) | | | — | | | — | | | — | | | $1,142,920 | | | — | | | $1,142,920 | |
| | Insurance Coverage(2) | | | — | | | — | | | — | | | $47,000 | | | — | | | $47,000 | | |||
| | Club Membership(3) | | | — | | | — | | | — | | | — | | | — | | | $— | | |||
| | Automobile(3) | | | — | | | — | | | — | | | $42,000 | | | — | | | $42,000 | | |||
| | Vesting of Equity Awards(4) | | | — | | | — | | | — | | | $100,746 | | | — | | | $— | | |||
| | SERP Benefit(5) | | | $8,758,000 | | | $13,981,000 | | | $8,829,000 | | | $9,783,000 | | | — | | | $— | | |||
| | Total | | | $8,758,000 | | | $13,981,000 | | | $8,829,000 | | | $11,115,666 | | | — | | | $1,231,920 | | |||
| | David C. Burney | | | Salary Continuation(1) | | | — | | | — | | | — | | | $355,550 | | | — | | | $355,550 | |
| | Insurance Coverage(2) | | | — | | | — | | | — | | | $23,000 | | | — | | | $23,000 | | |||
| | Club Membership(3) | | | — | | | — | | | — | | | $9,522 | | | — | | | $9,522 | | |||
| | Automobile(3) | | | — | | | — | | | — | | | $6,500 | | | — | | | $6,500 | | |||
| | Vesting of Equity Awards(4) | | | — | | | — | | | — | | | $21,315 | | | — | | | $— | | |||
| | SERP II Benefit(5) | | | $4,017,000 | | | $6,492,000 | | | $4,090,000 | | | $4,545,000 | | | $6,217,000 | | | $6,217,000 | | |||
| | Total | | | $4,017,000 | | | $6,492,000 | | | $4,090,000 | | | $4,960,887 | | | $6,217,000 | | | $6,611,572 | | |||
| | James S. Kramer | | | Salary Continuation(1) | | | — | | | — | | | — | | | $292,932 | | | — | | | $292,932 | |
| | Insurance Coverage(2) | | | — | | | — | | | — | | | $22,000 | | | — | | | $22,000 | | |||
| | Club Membership(3) | | | — | | | — | | | — | | | $9,709 | | | — | | | $9,709 | | |||
| | Vesting of Equity Awards(4) | | | — | | | — | | | — | | | $21,315 | | | — | | | $— | | |||
| | SERP II Benefit(5) | | | $3,004,000 | | | $4,981,000 | | | $2,998,000 | | | $3,486,000 | | | $5,225,000 | | | $5,225,000 | | |||
| | Total | | | $3,004,000 | | | $4,981,000 | | | $2,998,000 | | | $3,831,956 | | | $5,225,000 | | | $5,549,641 | | |||
| | Mark A. Peabody | | |||||||||||||||||||||
| | Salary Continuation(1) | | | — | | | — | | | — | | | $480,970 | | | — | | | $480,970 | | |||
| | Insurance Coverage(2) | | | — | | | — | | | — | | | $27,000 | | | — | | | $27,000 | | |||
| | Vesting of Equity Awards(4) | | | — | | | — | | | — | | | $21,315 | | | — | | | $— | | |||
| | SERP II Benefit(5) | | | $5,263,000 | | | $6,414,000 | | | $5,387,000 | | | $5,657,000 | | | $6,123,000 | | | $6,123,000 | | |||
| | Total | | | $5,263,000 | | | $6,414,000 | | | $5,387,000 | | | $6,186,285 | | | $6,123,000 | | | $6,630,970 | |
| (1) | Salary continuation under a termination on a change of control would be two years for Mr. Gundermann and one year for each of Messrs. Burney, Kramer, Kuehn, Mulato and Peabody. |
| (2) | For purposes of determining premiums for medical, life and disability coverage, the premiums paid in fiscal year |
| (3) | For purposes of determining other perquisites, the amount paid in |
| (4) | This is the value of outstanding, unvested stock options at December 31, |
| (5) | Pursuant to the terms of SERP and SERP II, participants become vested in and eligible for benefits in the event of a participant’s death or termination of employment due to Disability, and those participants with at least 10 years of service will become vested in and eligible for benefits in the event of an involuntary termination without cause and a termination on Change of Control. Participants in SERP II become vested in and eligible for benefits in the event of a 409A Change in Control Event. The SERP does not provide for vesting upon a 409A Change in Control Event. All amounts represent the actuarially estimated present value of future benefits, SERP II benefits upon a 409A Change in Control Event are payable in a lump sum. All other SERP and SERP II benefits are payable in equal monthly installments over the life of the executive or the life of the surviving spouse. |
42
27
EXECUTIVE COMPENSATION
Equity Compensation Plan Information
The following table sets forth the aggregate information of the Company’s equity compensation plans in effect as of December 31, 2018.
Plan Category | Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (b) | Number of Securities Remaining for Future Issuance under Equity Compensation Plans (excluding securities reflected in column (a)) (c) | ||||||
Equity compensation plans approved by security holders | 1,455,263 | $ | 19.36 | 3,116,709 | |||||
Equity compensation plans not approved by security holders | — | — | — | ||||||
Total | 1,455,263 | $ | 19.36 | 3,116,709 | |||||
2021.
| | Plan Category | | | Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (a) | | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (b)(1) | | | Number of Securities Remaining for Future Issuance under Equity Compensation Plans (excluding securities reflected in column (a)) (c) | |
| | Equity compensation plans approved by security holders | | | 1,954,466(2) | | | $20.03 | | | 2,777,343 | |
| | | | | | | | | ||||
| | Equity compensation plans not approved by security holders | | | — | | | — | | | — | |
| | Total | | | 1,954,466 | | | $20.03 | | | 2,777,343 | |
| (1) | The weighted average exercise price is calculated based solely on the exercise price of outstanding options and do not reflect the shares that will be issued upon the vesting of outstanding awards of RSUs, which have no exercise price. |
| (2) | This number includes 416,352 shares subject to outstanding RSU awards, with the number of outstanding performance-based RSUs calculated at 100% of the target number of shares subject to each award. |
28
43
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
owned by each director, each executive officer named in the summary compensation table and by all directors and executive officers as a group as of March 31, 2019April 1, 2022 (an asterisk indicates less than 1% beneficial ownership of the class):
Shares of Common Stock | Shares of Class B Stock | |||||||||||
Name and Address of Owner(1) | Number | Percentage | Number | Percentage | ||||||||
Raymond W. Boushie(2) | 30,710 | * | 22,135 | * | ||||||||
Robert T. Brady(3) | 61,148 | * | 196,493 | 2.4 | % | |||||||
David C. Burney(4) | 75,742 | * | 209,456 | 2.6 | % | |||||||
John B. Drenning(5) | 73,501 | * | 472,210 | 5.8 | % | |||||||
Jeffry D. Frisby(6) | 5,333 | * | 800 | * | ||||||||
Peter J. Gundermann(7) | 124,645 | * | 765,563 | 9.2 | % | |||||||
Warren C. Johnson(8) | 5,333 | * | 800 | * | ||||||||
Kevin T. Keane(9) | 278,982 | 1.1 | % | 2,030,543 | 24.9 | % | ||||||
Neil Kim(10) | 5,333 | * | 800 | * | ||||||||
James S. Kramer(11) | 71,954 | * | 418,974 | 5.1 | % | |||||||
Mark Moran(12) | — | — | — | — | ||||||||
James F. Mulato(13) | 14,345 | * | 5,721 | * | ||||||||
Mark A. Peabody(14) | 69,597 | * | 218,934 | 2.7 | % | |||||||
BlackRock, Inc.(15) 55 East 52nd Street New York, NY 10055 | 2,941,886 | 11.5 | % | — | — | |||||||
FMR LLC(16) 245 Summer Street Boston, MA 02210 | 2,258,783 | 10.43 | % | — | — | |||||||
The Vanguard Group(17) 100 Vanguard Blvd. Malvern, PA 19355 | 1,556,308 | 7.18 | % | — | — | |||||||
Wellington Management Group LLP(18) 280 Congress Street Boston, MA 02210 | 1,509,912 | 6.97 | % | — | — | |||||||
International Value Advisers, LLC(19) 717 Fifth Avenue, 10th Floor New York, NY 10022 | 1,486,029 | 6.86 | % | — | — | |||||||
Neuberger Berman Group LLC(20) 1290 Avenue of the Americas New York, NY 10104 | 1,411,363 | 6.52 | % | — | — | |||||||
All directors and executive officers as a group (13 persons)(21) | 816,623 | 3.3 | % | 4,342,428 | 52.3 | % | ||||||
| | | | Shares of Common Stock | | | Shares of Class B Stock | | |||||||
| | Name and Address of Owner(1) | | | Number | | | Percentage | | | Number | | | Percentage | |
| | Raymond W. Boushie(2) | | | 45,425 | | | * | | | 18,045 | | | * | |
| | Robert T. Brady(3) | | | 76,100 | | | * | | | 184,349 | | | 2.9% | |
| | David C. Burney(4) | | | 84,408 | | | * | | | 205,975 | | | 3.2% | |
| | Tonit Calaway(5) | | | 15,730 | | | * | | | — | | | — | |
| | Jeffry D. Frisby(6) | | | 26,672 | | | * | | | 1,200 | | | * | |
| | Peter J. Gundermann(7) | | | 177,451 | | | * | | | 765,345 | | | 12.0% | |
| | Warren C. Johnson(6) | | | 22,572 | | | * | | | 1,200 | | | * | |
| | Robert S. Keane(8) | | | 101,276 | | | * | | | 655,085 | | | 10.3% | |
| | Neil Kim(6) | | | 22,572 | | | * | | | 1,200 | | | * | |
| | James S. Kramer(9) | | | 90,801 | | | * | | | 415,543 | | | 6.5% | |
| | Michael C. Kuehn(10) | | | 29,570 | | | * | | | 966 | | | * | |
| | Mark Moran | | | 14,572 | | | * | | | — | | | — | |
| | James F. Mulato(11) | | | 54,336 | | | * | | | 8,251 | | | * | |
| | Mark A. Peabody(12) | | | 74,806 | | | * | | | 214,591 | | | 3.4% | |
| | BlackRock, Inc.(13) 55 East 52nd Street New York, NY 10055 | | | 2,070,498 | | | 8.3% | | | — | | | — | |
| | Patricia Dowden(14) 4 Goddu Ave. Winchester, MA 01890 | | | — | | | — | | | 450,481 | | | 6.4% | |
| | Next Century Growth Investors, LLC(15) 500 Wayzata Blvd., Suite 1275 Minneapolis, MN 55416 | | | 1,990,047 | | | 7.93% | | | — | | | — | |
| | Royce & Associates, LP(16) 745 Fifth Avenue New York, NY 10151 | | | 1,537,421 | | | 6.13% | | | — | | | — | |
| | 325 Capital Master Fund LP(17) 200 Park Avenue, 17th Floor New York, NY 10016 | | | 1,346,394 | | | 5.35% | | | — | | | — | |
| | Paradice Investment Management LLC(18) 250 Fillmore St., Suite 425 Denver, CO 80206 | | | 1,258,076 | | | 5.0% | | | — | | | — | |
| | All directors and executive officers as a group (14 persons)(19) | | | 836,291 | | | 3.3% | | | 2,471,751 | | | 38.8% | |
| (1) | The address for all directors and officers listed is: 130 Commerce Way, East Aurora, New York 14052. |
| (2) | Includes |
| (3) | Includes |
| (4) | Includes 40,236 shares of Common Stock and 14,142 shares of Class B Stock subject to options exercisable within 60 days. |
| (5) |
| (6) | Includes |
| (7) | Includes 132,734 shares of Common Stock and 21,852 shares of Class B Stock subject to options exercisable within 60 days. |
| (8) | Mr. Robert Keane does not have any options to purchase shares of Common Stock or Class B Stock in his name individually. Includes |
| Robert Keane and his spouse. Includes |
| Includes |
| Includes |
44
29
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
| Includes |
| Includes |
| BlackRock, Inc. reports having sole voting power for |
| (14) | Patricia Dowden is the sister of Mr. Robert Keane. Ms. Dowden reports having sole voting power and sole dispositive power for 450,481 shares of Class B Common Stock and no shared voting |
| (15) |
| (16) |
| (17) |
| (18) | Paradice Investment Management LLC and Paradice Investment Management PTY Ltd. report having no sole voting power, shared voting power for 771,775 shares of Common Stock and shared dispositive power for 1,258,076 shares of Common Stock. The beneficial ownership information is based solely upon Schedule 13G/A filed with the SEC on February |
| Includes |
45
30
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Except as noted below, during 2018, the executive officers and directors of the Company timely filed with the Securities Exchange Commission all required reports with respect to beneficial ownership of the Company’s securities. The sale of shares of Common Stock in January 2018 pursuant to a 10b5-1 trading plan by Mark Peabody was reported on a late Form 4 filed on February 20, 2018. The adjustment to outstanding options issued to Neil Kim to reflect the Company’s 15% Class B Distribution in October 2018 was reported on a late Form 4 filed on March 7, 2019.
The Company does not have written policies or procedures relating to the review, approval or ratification of related person transactions. Any such proposed transaction is submitted to the Board of Directors for approval. PROPOSALS OF SHAREHOLDERS FOR 12, 2022.CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS AND DIRECTOR INDEPENDENCEJohn B. Drenning, who served as a director of the Company until his death in March 2019, was a partner in the law firm of Hodgson Russ LLP. During 2018, the Company incurred legal fees from Hodgson Russ LLP totaling $269,264.20202023 ANNUAL MEETINGTo be considered for inclusion in the proxy materials for the 20202023 Annual Meeting of Shareholders, shareholder proposals must be received by the Company no later than December 19, 2019.If a shareholder wishes to present a proposal at the Company’s 20202023 Annual Meeting of Shareholders or to nominate one or more directors, and the proposal is not intended to be included in the Company’s proxy materials relating to that meeting, such proposal or nomination(s) must comply with the applicable provisions of the Company’s by-laws andapplicable law. In general, the Company’s by-laws provide that with respect to a shareholder nomination for director, written notice must be addressed to the Secretary and be received by the Company no less than 60 nor more than 90 days prior to the first anniversary of the preceding year’s annual meeting.Annual Meeting. For purposes of the Company’s 20202023 Annual Meeting of Shareholders, such notice must be received not later than March 31, 202024, 2023 and not earlier than March 1, 2020.February 22, 2023. The Company’s by-laws set out specific requirements that such written notices must satisfy.31OTHER BUSINESSThe Board of Directors knows of no other matters to be voted upon at the Annual Meeting. If any other matters properly come before the Annual Meeting, it is the intention of the persons named in the proxy to vote on such matters in accordance with their judgment.The Notice Regarding Availability of Proxy Materials for the Shareholder Meeting to be Held on Monday, May 30, 201923, 2022 has been mailed to shareholders. Copies of the Annual Report, as well as this Proxy Statement, Proxy Card(s), and Notice of Annual Meeting of Shareholders, are available at http://materials.proxyvote.com/046433 or by telephone at 1-800-579-1639.A COPY OF THE COMPANY’S ANNUAL REPORT ON FORM 10-K, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WILL BE FURNISHED WITHOUT CHARGE TO SHAREHOLDERS, BENEFICIALLY OR OF RECORD ON APRIL 10, 2019,4, 2022, ON REQUEST TO SHAREHOLDER RELATIONS, ASTRONICS CORPORATION, 130 COMMERCE WAY, EAST AURORA, NEW YORK 14052. THE ANNUAL REPORT ON FORM 10-K MAY ALSO BE OBTAINED IN THE INVESTOR RELATIONS SECTION OF THE COMPANY’S WEBSITE: WWW.ASTRONICS.COMwww.astronics.com.By Order of the Board of Directors
David C. Burney,Julie M. Davis, SecretaryEast Aurora, New YorkDated: April 17, 201911, 20223247
