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Suite 1000 60631 STOCKHOLDERS 15, 2021 how does it affect me? stockholders. NYSE. controls. related services. plan. Governance Aspatore Board. fees. SEC’s rules. Recommendations must be sent to the Nominating and Governance Committee, Methode Electronics, Inc., 2021 Annual Meeting. For amounts for fiscal 2021 and fiscal 2022. Fees Earned or Paid in Cash ($) Stock Awards ($) (1) Total ($) Stockholders BlackRock, Inc. (1) 55 East 52nd Street New York, New York 10055 The Vanguard Group (2) 100 Vanguard Blvd. Malvern, Pennsylvania 19355 The Bank of New York Mellon Corporation (3) 225 Liberty Street New York, New York 10286 Dimensional Fund Advisors LP (4) Building One 6300 Bee Cave Road Austin, TX 78746 directors to be elected at the Annual Meeting. stockholders. EXECUTIVE COMPENSATION aggregate purchase price of $7.5 million. The Compensation Committee regularly holds executive sessions without any members of management present. peers. Donald W. Duda (1) Achieve consolidated pre-tax income (as adjusted for business acquisitions or dispositions) of $104.0 million (threshold), $109.5 million (target) and $125.9 million (maximum), with $250,638, $501,276 and $1,002,551 payable at threshold, target and maximum, respectively. The Company achieved consolidated pre-tax income of $117.3 million and Mr. Duda earned $740,709. (2) Achieve $60.0 million in certain new business annual sales with a minimum established pre-tax margin ($214,832 payable). The Company achieved annual sales of $74.0 million for such new business. (1) Achieve consolidated pre-tax income (as adjusted for business acquisitions or dispositions) of $104.0 million (threshold), $109.5 million (target) and $125.9 million (maximum), with $103,950, $207,900 and $415,800 payable at threshold, target and maximum, respectively. The Company achieved consolidated pre-tax income of $117.3 million and Mr. Hrudicka earned $307,203. (2) Implement changes to the ERP system related to foreign currency conversions ($89,100 payable). This performance measure was achieved. (1) Achieve consolidated pre-tax income (as adjusted for business acquisitions or dispositions) of $104.0 million (threshold), $109.5 million (target) and $125.9 million (maximum), with $84,004, $168,008 and $336,016 payable at threshold, target and maximum, respectively. The Company achieved consolidated pre-tax income of $117.3 million and Mr. Khoury earned $248,257. (2) Achieve $60.0 million in certain new business annual sales with a minimum established pre-tax margin ($72,004 payable). The Company achieved annual sales of $74.0 million for such new business. (1) Achieve consolidated pre-tax income (as adjusted for business acquisitions or dispositions) of $104.0 million (threshold), $109.5 million (target) and $125.9 million (maximum), with $26,321, $52,642 and $105,284 payable at threshold, target and maximum, respectively. The Company achieved consolidated pre-tax income of $117.3 million and Mr. Kill earned $77,786. (2) Achieve $2.0 million in revenue from our Dabir Surface medical device products ($78,963 payable). This performance measure was not met. (3) Obtain a reimbursement code for our Dabir Surface medical device products ($78,963 payable). This performance measure was not met due to the Company’s decision to defer acceptance of the reimbursement code until a later year. After reviewing the basis for this decision, the Compensation Committee determined that it would be appropriate to approve the payout for fiscal 2017 with the understanding that Mr. Kill would not be eligible to be rewarded for the same performance in the future. (1) Achieve consolidated pre-tax income (as adjusted for business acquisitions or dispositions) of $104.0 million (threshold), $109.5 million (target) and $125.9 million (maximum), with $36,250, $72,499 and $144,999 payable at threshold, target and maximum, respectively. The Company achieved consolidated pre-tax income of $117.3 million and Mr. Koman earned $107,137. (2) Implement changes to the ERP system related to foreign currency conversions ($31,171 payable). This performance measure was achieved. provide excise tax gross-ups. Clawback Policy. In the event we are required to restate our financial statements due to material noncompliance, our Incentive Compensation Recoupment Policy requires us to recover from our current or former executive officers certain amounts of incentive-based compensation paid within the prior three years that were erroneously paid. TABLES Name and Principal Position Fiscal Year Salary ($) Stock Awards ($) (2) Option Awards ($) (2) Non-Equity Incentive Plan Compensation ($) Total ($) Annual Bonus (6) Donald W. Duda President and Chief Executive Officer John R. Hrudicka Chief Financial Officer and Joseph E. Khoury Senior Vice President (9) Timothy R. Glandon Vice President Douglas A. Koman Retired Chief Financial Officer and Vice President, Corporate Finance (8) Vested RSU Dividend Equivalents ($) Life Insurance ($) Mr. Khoury is a Lebanese Grant Date Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) Grant Date Fair Value of Stock and Option Awards ($) (4) Threshold ($) Target ($) Maximum ($) Committee awarded the named executive officers an annual performance-based bonus award, and long-term incentive awards under the 2021 LTI Program. Name and Principal Position Fiscal Year Salary ($) Annualized Value of Stock Awards ($)(2) Option Awards ($)(3) Annual Bonus (9) Donald W. Duda President and Chief Executive Officer 2016 2015 695,598 675,000 -- 115,000 1,216,080(4) 388,000(6) 810,720(5) 194,000(7) -- 599,600 -- 697,440 572,102 1,147,500 311,114 429,130 3,605,614 4,245,670 John R. Hrudicka Chief Financial Officer and Vice President, Corporate Finance (11) Joseph E. Khoury Senior Vice President (12) 2016 2015 359,600 352,324 -- 65,000 608,040(4) 116,400(6) 405,360(5) 58,200(7) -- 179,880 -- 209,232 184,127 401,676 90,221 107,330 1,647,348 1,490,042 Theodore P. Kill Vice President, Worldwide Automotive Sales and President of Dabir Surfaces Timothy R. Glandon Vice President 2016 2015 295,000 295,000 -- 50,000 -- 116,400(6) -- 58,200(7) -- 179,880 -- 209,232 -- 272,580 103,952 119,063 398,952 1,300,355 Douglas A. Koman Retired Chief Financial Officer and Vice President, Corporate Finance (11) Outstanding Equity Awards at Fiscal Year-End Number of Securities Underlying Unexercised Options (#) Exercisable Number of Securities Underlying Unexercised Options (#) Unexercisable Option Exercise Price ($) Value Realized on Exercise ($) (1) Value Realized on Vesting ($) (3) Executive Contributions in Last Fiscal Year ($) (1) Registrant Contributions in Last Fiscal Year ($) Aggregate Earnings in Last Fiscal Year ($) Aggregate Withdrawals/ Distributions ($) (2) Aggregate Balance at Last Fiscal Year-End ($) 2021. 2021. daily. Potential Payments Upon Termination or Messrs. Duda, Termination Scenario (on 4/28/17) Salary and Bonus Severance ($) Vesting of Option Awards ($) Health and Welfare Benefits ($) (2) Reports 60631.Exact Name of Registrant as Specified In Its Charter)other thanOther Than the Registrant) Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.(1) (2) (3) (4) (5) Fee paid previously with preliminary materials.Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.(1) (2) (3) (4) 7401WilsonBryn Mawr Avenue,60706SHAREHOLDERS14, 2017______________________the Shareholdersour Stockholders::Notice is hereby given that (“Methode” or the annual meeting of shareholders of Methode Electronics, Inc.“Company”) will be held on Thursday,Wednesday, September 14, 201715, 2021 at 11:00 a.m., Central Daylight Time, at Methode’s corporate offices at 7401 West Wilson Avenue, Chicago, Illinois, 60706 forTime. The 2021 Annual Meeting will be a virtual meeting conducted via live webcast. You will be able to attend the Annual Meeting as well as vote and submit your questions during the live webcast of the meeting by visiting www.virtualshareholdermeeting.com/MEI2021 and entering the 16-digit control number included in the Notice of Internet Availability of Proxy Materials, on your proxy card or in the instructions that accompanied your proxy materials.purposes:matters, each as more fully described in the accompanying proxy statement:1. To elect each director nominee to hold office until the Company’s 2022 Annual Meeting of Stockholders or until such director’s earlier resignation, or a Board of Directors;respective successor is duly elected and appointed;2. To ratify the Audit Committee’s selection of Ernst & Young LLP to serve as our independent registered public accounting firm for the fiscal year ending April 28, 2018;30, 2022;3. To provideapprove, on a non-binding, advisory approvalbasis, the compensation of Methode’s named executive officer compensation;4.To cast an advisory vote on the frequency of future advisory votes on Methode’s named executive officer compensation;officers; and5.4.To transact such other business as may properly come before the annual meetingAnnual Meeting or any adjournment or postponement thereof. “FOR”(Proposal 1), “FOR” the ratification of Ernst & Young LLPEY as our independent registered public accounting firm (Proposal 2) and “FOR” advisory approval of Methode’s named executive officer compensation andthe Say-on-Pay Proposal (Proposal 3).a “ONE-YEAR” frequency forall three proposals.advisory vote on executive compensation.Our Board of Directors has fixed the close of business on July 17, 2017 as the record date for the determination of shareholders entitled to notice of and to vote at the annual meeting and at any adjournment or postponement thereof.We are furnishing materials for our annual meeting on the Internet. Youproposals?your shares(1) “for,” (2) “against,” or (3) “abstain” from voting. The affirmative vote of a majority of the voting power present in person by attending our annual meeting, or by proxy. To voterepresented by proxy you may vote usingat the Internet,Annual Meeting is required to approve each proposal. Broker non-votes will not be counted for purposes of determining the number of votes present in person or represented by toll-free telephone number or, if you requestproxy with respect to the election of directors (Proposal 1) and receive a paper copy of the proxy card by mail, by signing, dating and mailing the proxy card in the self-addressed, postage-paid envelope provided.Information regarding voting by using the Internet or by telephone is contained in the Notice of Internet Availability of Proxy Materials. Instructions regarding voting by mail are contained on the proxy card.It is important that your sharesSay-on-Pay Proposal (Proposal 3). Abstentions will be represented and voted at the annual meeting. Whether orconsidered as present but will not you plan to attend the annual meeting, please vote on the matters to be considered. Thank you for your interest and cooperation.By Order of the Board of Directors,Walter J. AspatoreChairmanChicago, IllinoisAugust 1, 2017METHODE ELECTRONICS, INC.7401 West Wilson AvenueChicago, Illinois 60706(708) 867-6777PROXY STATEMENTANNUAL MEETING OF SHAREHOLDERSSeptember 14, 2017GENERAL INFORMATIONWe are furnishing this proxy statement to you in connection with the solicitation of proxies on behalf of Methode Electronics, Inc. (“Methode” or the “Company”) for use at our annual meeting of shareholders to be held on Thursday, September 14, 2017 at 11:00 a.m., Central Daylight Time, at Methode’s corporate offices at 7401 West Wilson Avenue, Chicago, Illinois, 60706 and at any adjournment or postponement of the annual meeting. On August 1, 2017, we mailed our Notice of Internet Availability of Proxy Materials, which contains instructions for our shareholders to access our proxy statement and annual report over the Internet or request a paper copy of the proxy materials.At the annual meeting, we will ask our shareholders to (i) elect our Board of Directors, (ii) ratify the Audit Committee’s selection of Ernst & Young LLP (“Ernst & Young”) to serveconsidered as our independent registered public accounting firm for fiscal 2018, (iii) provide advisory approval of Methode’s named executive officer compensation, (iv) cast an advisory vote on the frequency of future advisory votes on Methode’s named executive officer compensation, and (v) consider and vote upon any other business which properly comes before the annual meeting.The Board of Directors recommends that you vote “FOR” each of Methode’s nominees for director, “FOR” the ratification of Ernst & Young as our independent registered public accounting firm, “FOR” advisory approval of Methode’s named executive officer compensation and in favor of any proposal. Consequently, abstentions have the effect of voting against all proposals, while broker non-votes have no effect as to voting for or against Proposal 1 or Proposal 3.“ONE-YEAR” frequency“broker non-vote”?the advisorya beneficial owner does not vote on executive compensation.You may votea proposal because the nominee has not received instructions from the beneficial owner and does not have discretionary voting power. Under the rules of the New York Stock Exchange (the “NYSE”), brokerage firms have the authority to cast votes on certain “routine” matters if they do not receive instructions from their customers. The auditor ratification proposal (Proposal 2) is considered a “routine” matter and your shares may be voted on such proposal if they are held in person, by attending our annual meeting, or by proxy. To vote by proxy, you may vote using the Internet, by toll-free telephone number or,name of a brokerage firm even if you request and receive a paper copy of the proxy card by mail, by signing, dating and mailing the proxy card in the self-addressed, postage-paid envelope provided.Information regarding voting by using the Internet or by telephone is contained in the Notice of Internet Availability of Proxy Materials. Instructions regarding voting by mail are contained on the proxy card. Please do not submit a proxy card if you have voted by telephone or the Internet.It is important that your shares be representedprovide voting instructions. The other proposals being considered and voted on at the annual meeting. Whether orAnnual Meeting are “non-routine” matters for which brokers may not you plan to attendvote absent voting instructions from the annual meeting in person, please vote on the matters to be considered.Record Date; Shares OutstandingOur Board of Directors has fixed the close of business on July 17, 2017 as the record date for the determination of shareholders entitled to notice of and to vote at the annual meeting and at any adjournment or postponement thereof. As of the record date, there were 36,810,853 shares of our common stock outstanding and entitled to vote at the annual meeting.Quorum; Votes RequiredIn deciding all questions, assumingbeneficial owner.quorum is present, a holder of Methode’s common stock is entitled to one vote, in person or by proxy, for each share held in such holder’s name on the record date. quorum?stockstock is necessary to constitute a quorum at the annual meeting. BothAnnual Meeting. Broker non-votes and abstentions and broker non-votes are counted aswill be considered present for the purpose of determining the presence ofwhether we have a quorumquorum.annual meeting. Generally, broker non-votes occur when shares held by a broker for a beneficial owner areAnnual Meeting?voted with respectaware of any matters to a particular proposal because the broker lacks discretionary power to vote such shares.With respect to the election of directors, the ratification of the selection of Ernst & Young as our independent registered public accounting firm and providing advisory approval of our executive compensation, shareholders may vote (1) “for,” (2) “against,” or (3) to “abstain” from voting on each matter and each such matter requires approval by a majority of the shares of common stock representedbe properly presented at the meeting and entitledAnnual Meeting other than those referred to vote. On the proposal regarding an advisory vote on the frequency of future advisory votes on executive compensation, shareholders may vote to hold such votes (A) each year, (B) every two years, (C) every three years, or (D) may abstain from voting. On this proposal, the frequency option that receives the affirmative vote of a majority of the shares of common stock represented at the meeting and entitled to vote will be deemed to be approved by the shareholders. If none of the options for this proposal receives a majority vote, we will consider the alternative that receives the highest number of votes cast by the shareholders to be the frequency that has been selected by the shareholders. Both abstentions and broker non-votes will be considered as present but will not be considered as votes in favor of any matter. Broker non-votes are excluded from the “for,” “against” and “abstain” counts, and instead are reported as simply “broker non-votes.” Consequently, abstentions have the effect of voting against these matters, while broker non-votes have no effect as to voting for or against any such matter.Under New York Stock Exchange rules, the proposal to ratify the selection of Ernst & Young is considered a routine item. Therefore, brokers may vote in their discretion on this matter on behalf of clients who have not furnished voting instructions to the broker. In contrast, all other proposals set forth in this proxy statementstatement. If other matters are considered non-routine items, and brokers who have not received voting instructions from their clients may not vote on these proposals.All properly executed and timely delivered proxies will be voted in accordance with the instructions provided. Unless contrary instructions are indicated, proxies will be voted “FOR” each of Methode’s nominees for director, “FOR” the ratification of the selection of Ernst & Young, “FOR” advisory approval of Methode’s named executive officer compensation and in favor of a “ONE-YEAR” frequency for the advisory vote on executive compensation. The Board of Directors knows of no other business that will be presented for consideration at the annual meeting. If any other matter is properly presented, it is the intentionAnnual Meeting, and you are a stockholder of record and have authorized a proxy to vote your shares, the persons named inas proxies will have the discretion to vote on those matters for you.in accordance with their best judgment.Voting ProceduresIt is important that your shares be represented at the annual meeting. You may vote your shares in person, by attending our annual meeting, or by proxy. To vote by proxy, you may vote using the Internet, by toll-free telephone number or, if you request and receive a paper copy of the proxy card by mail, by signing, dating and mailing the proxy card in the self-addressed, postage-paid envelope provided. Information regarding voting by using the Internet or by telephone is contained in the Notice of Internet Availability of Proxy Materials. Instructions regarding voting by mail are contained on the proxy card. Please do not submit a proxy card if you have voted by telephone or the Internet. You may revoke your proxy as described below.Revoking Your ProxyIf you decide to change your vote, you may revoke your proxy at any time before the annual meeting.my shares?thethe following address: Methode Electronics, Inc., 74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706, attention: Corporate Secretary.60631. You may also revoke your proxy by submitting a later-datedlater dated and properly executedexecuted proxy (including by means of the telephone or Internet)internet) or by voting in person at the annual meeting. AttendanceAnnual Meeting. New paper proxy cards should be sent to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. Your attendance at the annual meetingvirtual Annual Meeting will not, by itself, revoke a proxy.Proxy Solicitation ExpensesThe proxy is being solicited on behalf of Methode.previously authorized by you. We will bearhonor the entire costproxy card or authorization with the latest date. by fax or in person. No additional compensation will be paid to directors, officers and other regular employees for such services. We have retained the services of Innisfree M&A IncorporatedAlliance Advisors, LLC (“Innisfree”Alliance”) to serve as our proxy solicitor in connection with the annual meeting. InnisfreeAnnual Meeting. Alliance may assist us in soliciting proxies by telephone, email and by other means, and we expect to pay InnisfreeAlliance a fee of $20,000, plus reasonable expenses.2 In the event that beneficial owners of our shares request paper copies of our proxy materials, banks, brokerage houses, fiduciariesWhat is “householding” and custodians holding shares of our common stock beneficially owned by others as of the record date will be requested to forward such proxy soliciting material to the beneficial owners of such shares and will be reimbursed by Methode for their reasonable out-of-pocket expenses.Householding of Annual Meeting Materialsof Internet Availability of Proxy Materialsand Access Card and, if applicable, our proxy materials, to shareholdersstockholders who share the same last name and address, unless they have notified us that they want to continue receiving multiple copies. This practice is known as “householding,“householding.” is designed to reduce duplicate mailings and save printing and postage costs. ShareholdersStockholders who participate in householding will continue to be able to access and receive separate proxy cards. If you received a householded mailing this year and you would like to have additional copies of our Notice of Internet Availability of Proxy Materials and if applicable, ourAccess Card and proxy materials, mailed to you; if you received multiple copies of our Notice of Internet Availability of Proxy Materials and would preferlike to participate in householding;householding or if you would like to opt out of householding, for future mailings, you may do so at any time by contactingplease contact us at: Methode Electronics, Inc., 74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706,60631, Attention: Corporate Secretary, or telephonically at 708-867-6777.3 shareholders.Directors has considered the independence of theour nominees for director undermeets the applicable independence standards of the U.S. Securities and Exchange Commission (“SEC”)SEC and the New York Stock Exchange. OurNYSE. The Board has determined that all of the nominees for director are independent under the applicable standards, except for Donald Duda, our President and Chief Executive Officer. Mr. Duda’s lack of independence relates solely to his service as an executive officer and is not due to any other transactions or relationships.New York Stock Exchange.committeesmembership, principal functions and number of meetings held in fiscal 2021 for each of our Board for fiscal 2017.Committees.CommitteeMembers 20172021 AuditIsabelle C. Goossen Walter J. AspatoreStephen F. GatesPaul G. Shelton control. and makes decisions regarding the retention, termination and compensation of the independent registered public accountingsuch firm and approves services provided by the independent registered public accounting firm. discussdiscusses guidelines and policies by which risk assessment and risk management is undertaken. 9 CompensationStephen F. Gates Warren L. BattsMartha Goldberg AronsonIsabelle C. GoossenPaul G. Shelton and bonus plans. consultants,consultant, and monitors their independence. 5Christopher HornungCadwallader (Chair)AspatoreWarren L. BattsStephen F. Gates Board at the annual meeting or to fill vacancies. performance.•Reviews our risk management policies and practices.•Reviews succession planning for our Chief Executive Officer.54 CommitteeMembersPrincipal FunctionsNumber of Meetings in Fiscal 2017Technology Walter J. AspatoreWarren L. BattsMartha Goldberg AronsonChristopher J. Hornung 4 Mr. Gates passed away in July, 2017. Subsequently, the size of the Board was reduced from ten directors to nine directors and Ms. Goldberg Aronson was appointed Chair of our Compensation Committee. The Board expressed its great appreciation for all of the contributions Mr. Gates made over the years.Methode’sthe rationale for entering into the transaction, alternatives to the transaction, whether the transaction is on terms at least as fair to Methode as would be the case were the transaction entered into with a third party and other relevant factors.the 2017 fiscal year,2021, our Board of Directors held twelvesix meetings, and no director attended less than 75% of the aggregate of the total number of meetings of our Board and the total number of meetings held by the respective committees on which he or she served. Under our Corporate Governance Guidelines, our directors are expected to attend Board and shareholderstockholder meetings and meetings of committees on which they serve. Our directors are expected to meet as frequently as necessary to properly discharge their responsibilities.Audit, Compensation, Nominating and Governance and Technology Committeescommittees operate pursuant to charters adopted by the Board, whichBoard. Our committee charters and our Corporate Governance Guidelines are available on the Investors page of our website atwww.methode.com or in print upon any shareholder’sstockholder’s request. Our Corporate Governance Guidelines are also available on our website atwww.methode.com or in print upon any shareholder’s request.shareholders.stockholders. This structure provides for a greater role for the independent directors in the oversight of Methode and active participation of the independent directors in setting agendas and establishing priorities and procedures for the work of the Board. directors send their completed evaluations directly to outside legal counsel. Legal counseland compiles the responses into a written report, which is then distributed to, and discussed by, the Nominating and Governance Committee and the full Board. Methode’s employees and political risks encountered by Methode throughout the world. Our Audit Committee discusses with management Methode’s major financial risk exposures and the steps management has taken to monitor and control such exposures and reviews the process by which risk is managed and assessed. Our Audit Committee also reviews the Company’s cyber-securitycybersecurity and information technology practices and policies.policies and is briefed quarterly by management. Our Compensation Committee evaluates risks arising from Methode’s compensation practices and policies. Our Nominating and Governance Committee reviews and evaluates Methode’s policies and practices with respect to risk management and risk assessment in areas such as business operations, human resources, international operations and5 intellectual property.oversees the Company’s Enterprise Risk Management (ERM) program. The entire Board of Directors is regularly informed about the risk management policies and practices monitored by the various committees. The Board of Directors also receives reports directly from officers responsible for assessing and managing particular risks within Methode.Board.Board, including racial and gender diversity. The Committee seeks an appropriate balance between newer directors and longer-serving directors. While the Nominating and Governance Committee charter and our CorporateThe Committee identifies We believe that our directors’ outside directorships enable them to contribute valuable knowledge and experience to the Board. Nonetheless, the Board is sensitive to the potential nominees by asking currentfor overboarding to compromise the ability of these directors and others to notify the Committee if they become aware of persons, meeting the criteria described above, who may be available toeffectively serve on our Board and Committees. Our Corporate Governance Guidelines limit each director’s service on the boards of public companies to no more than three other boards. Our Audit Committee Charter limits each member’s service on audit committees of public companies to no more than two other audit committees, unless approved by the Board.used to identify director candidates and has sole authority to approve the search firm’s fees and other retention terms. Historically, the Committee has not engaged third parties to assist in identifying and evaluating potential nominees, but would do so in those situations where particular qualifications are required to fill a vacancy and our Board’s contacts are not sufficient to identify an appropriate candidate.shareholders. Any recommendations received from shareholders will be evaluated in the same manner that potential nominees suggested by Board members are evaluated. Upon receiving a shareholder recommendation, the Committee will initially determine the need for additional or replacement Board members and evaluate the candidate based on the information the Committee receives with the shareholder recommendation or may otherwise acquire, and may, in its discretion, consult with the other members of our Board. If the Committee determines that a more comprehensive evaluation is warranted, the Committee may obtain additional information about the director candidate’s background and experience, including by means of interviews with the candidate.Our shareholdersstockholders. Stockholders may recommend candidates at any time, but the Committee requires recommendations for election at an annual meeting of shareholdersour Annual Meeting to be submitted to the Committee no later than 120 days before the first anniversary of the date of the proxy statement in connection withfrom the previous year’s annual meeting. The Committee believes this deadline is appropriate and in the best interests of Methode and our shareholders because it ensures that the Committee has sufficient time to properly evaluate all proposed candidates. Therefore, to submit a candidate for consideration for nomination at the 2018 annual meeting of shareholders, a shareholder must submit the recommendation, in writing, by April 3, 2018.Annual Meeting. The written notice must include:business address and residential address of each proposed nominee and the principal occupation or employment of each nominee;that eachowned by such nominee, beneficially owns;eachthe nominee is willing to be nominated;nominated, andconcerning each nominee that would be required under the rules of the SEC in a proxy statement soliciting proxies forunder the election of those nominees.6 74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706.60631. Any recommendations from stockholders will be evaluated in the same manner that potential nominees suggested by directors or Company contacts are evaluated. Information regarding the requirements to nominate a director at our 20182021 Annual Meeting areis set forth below under “Other Information -- Shareholder– Stockholder Proposals and Director Nominations.”Our annual meeting of shareholdersshareholdersstockholders to ask questions of, or otherwise communicate directly with, members of our Board of Directors on appropriate matters. All of our directors attended the 2016 annual meeting.2020 Annual Meeting. We anticipate that all of our directors will attend the 2017 annual meeting.74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706.60631. Copies of written communications received at such address will be provided to the relevant director or the independent directors as a group unless such communications are considered, in the reasonable judgment of the Corporate Secretary, to be improper for submission to the intended recipient(s). Examples of shareholderstockholder communications that would be considered improper for submission include, without limitation, customer complaints, solicitations, communications that do not relate directly or indirectly to us or our business or communications that relate to other improper or irrelevant topics. and EthicscodeCode is available on the Investors page of our website atwww.methode.com or in print upon any shareholder’sstockholder’s request. Guidelinesshareholders.stockholders. We maintain stock ownership guidelines for our directors. All directors are expected to own stock with a value equal to at least five times the annual cash retainer paid to Methode directors. The requirements aredirectors, subject to a five-year phase-in period.period for new directors. All of our directors were in compliance with our stock ownership guidelines for fiscal 2017.
2021, subject to the phase-in-period. Our Insider Trading Policy prohibits our directors from engaging in certain transactions involving our common stock, including options trading, short sales, derivative transactions and hedging transactions. In addition, our directors are prohibited from holding our common stock in a margin account or otherwise pledging our common stock as collateral for a loan.7 Directors who are also our full-time employees are not paid for their services as directors or for attendance at meetings.the fiscal year ended April 29, 2017,2021, our non-employee directors received an annual cash retainer, of $44,000meeting fees and an attendance feeannual stock award with immediate vesting. Our Chairman, Vice Chairman, committee chairs and members of $1,000 per committeethe Audit and Compensation Committees received additional cash retainers for their service in these capacities. In connection with the Company’s cost-cutting measures related to the COVID-19 pandemic, the retainers and meeting fees for our non-employee directors were reduced twenty percent (20%) for our first and for each board meeting other than the regularly scheduled quarterly meetings. In addition, in July 2016, the Compensation Committee, upon the recommendationsecond quarters of thefiscal 2021.granted eachoversees and makes recommendations to the Board regarding our non-employee director serving at such timecompensation program. Non-employee directors can defer receipt of all or a stock award for 3,000 sharesportion of common stock. Our Chairmantheir cash or equity compensation to our Deferred Compensation Plan.the Board and the Chair of each of our board committees received supplemental annual retainers in the following amounts: Chairman of the Board, $30,000; Chair of each of the Audit Committee and the Compensation Committee, $24,000; and Chair of each of the Nominating and Governance Committee, and the Technology Committee, $12,000. In addition, members of our Audit Committee and Compensation Committee (other than the Chair) received an additional annual retainer of $10,000. PursuantBoard approved changes to our Deferred Compensation Plan,compensation program for non-employee directors for fiscal 2022. In reviewing our directors may elect to defer up to 100%director compensation program, the Board considered peer and market data, as well as the advice and recommendations of their retainersFrederic W. Cook & Co., Inc., our independent compensation consultant.attendance fees per year. Additional information regarding the Deferred Compensation Plan is described under “Executive Compensation — Nonqualified Deferred Compensation” below. ourthe non-employee directors who served during theour fiscal year ended April 29, 2017.Name Walter J. Aspatore 111,270 102,870 214,140 Warren L. Batts 70,770 102,870 173,640 Darren M. Dawson 84,270 102,870 187,140 Stephen F. Gates 101,770 102,870 204,640 Martha Goldberg Aronson 69,770 102,870 172,640 Isabelle C. Goossen 101,270 102,870 204,140 Christopher J. Hornung 78,770 102,870 181,640 Paul G. Shelton 87,270 102,870 190,140 Lawrence B. Skatoff 80,770 102,870 183,640 (1) The reported amounts reflect the fair value at the date of grant calculated in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718. Details of the assumptions used in valuing these awards are set forth in Note 413 to our audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended April 29, 2017.May 1, 2021.8 (2)The amounts in the table above reflect the 20% reduction in the first and second quarters in connection with the Company’s cost-cutting measures related to the COVID-19 pandemic. (3) Ms. Goossen retired from the Board in September 2020 and Ms. Goddard was elected to the Board in March 2021. Shareholdersstock as of July 17, 2017.Name and Address of Beneficial Owner Amount and Nature
of Beneficial OwnershipPercent of Class (%) 4,106,670 11.2 3,040,563 8.3 2,853,738 7.8 2,049,446 5.6 (1) Information is based on a Schedule 13G/A filed with the SECSecurities and Exchange Commission (“SEC”) on January 12, 2017.25, 2021. In the Schedule 13G/A, BlackRock, Inc. reported that, as a parent holding company, as of December 31, 2016,2020, it had sole voting power with respect to 4,027,4685,940,010 shares and sole dispositive power with respect to 4,106,6706,036,730 shares. According to the Schedule 13G/A, the subsidiary BlackRock Fund Advisors beneficially owns 5% or greater of the Company’s outstanding shares.(2) Information is based on a Schedule 13G/A filed with the SEC on February 10, 2017.2021. In the Schedule 13G/A, The Vanguard Group reported that, as of December 31, 2016,2020, it had sole voting power with respect to 70,194 shares, shared voting power with respect to 5,55946,638 shares, sole dispositive power with respect to 2,966,7153,748,382 shares and shared dispositive power with respect to 73,84880,077 shares. Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 68,289 shares of the Company’s common stock as a result of its serving as investment manager of collective trust accounts. Vanguard Investments Australia, Ltd., a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 7,464 shares of the Company’s common stock as a result of its serving as investment manager of Australian investment offerings.(3) Information is based on a Schedule 13G/A filed with the SEC on February 3, 2017. In the Schedule 13G/A, The Bank of New York Mellon Corporation reported that, as of December 31, 2016, it had sole voting power with respect to 2,759,957 shares, sole dispositive power with respect to 2,826,838 shares and shared dispositive power with respect to 26,900 shares. The Schedule 13G/A reported that all of the shares are beneficially owned by The Bank of New York Mellon Corporation and its direct or indirect subsidiaries in their various fiduciary capacities (including as an investment adviser or a broker or dealer).(4)Information is based on a Schedule 13G/A filed with the SEC on February 9, 2017.12, 2021. In the Schedule 13G/A, Dimensional Fund Advisors LP reported that it is an investment advisor and, as of December 31, 2016,2020, it had sole voting power with respect to 1,949,2761,941,401 shares and sole dispositive power with respect to 2,049,4462,032,885 shares.9 17, 201719, 2021, by (i) each director and nominee, (ii) each of the named executive officers, and (iii) all current directors and executive officers as a group.Name of Beneficial Owner Amount and Nature of Beneficial Ownership (1) Percent of Class (%) Walter J. Aspatore 27,000(2) * Warren L. Batts 76,000 * Darren M. Dawson 13,000 * Donald W. Duda 631,364(3) 1.7 Martha Goldberg Aronson 6,000 (4) * Isabelle C. Goossen 43,450 * Christopher J. Hornung 37,850 * Paul G. Shelton 42,850 * Lawrence B. Skatoff 39,350(5) * Timothy R. Glandon 43,079(6) * John R. Hrudicka 72,000(7) * Joseph E. Khoury 240,600(8) * Theodore P. Kill 211,830(9) * Douglas A. Koman 119,792(10) * All current directors and executive officers as a group 1,604,165(11) 4.4 * * Percentage represents less than 1% of the total shares of common stock outstanding. (1) Beneficial ownership arises from sole voting and dispositive power unless otherwise indicated by footnote. (2) Includes 15,00027,000 shares held jointly with Mr. Aspatore’s wife.(3) Includes 19,5522,955 shares of phantom stock held jointlyin the Company’s Deferred Compensation Plan.(4) Shares are held in a trust pursuant to which Mr. Crowther shares voting and investment power with Mr. Duda’s wife,his wife.(5) Includes options to purchase 40,000 shares of common stock exercisable within 60 days, 201,812195,055 shares of vested restricted stock units for which common stock will be delivered to Mr. Duda at such time as the value of the award is deductible by us or Mr. Duda’s employment terminates, 100,000220,000 shares of vested restricted stock units for which common stock will be delivered to Mr. Duda in the event of termination from Methode under any circumstance and 270,000375,000 shares of performance-based restricted stock subject to forfeiture.(4)Shares are held in a trust pursuant to which Ms. Goldberg Aronson shares voting and investment power with her husband.(5)(6) Shares are held in a trust pursuant to which Mr. Skatoff shares voting and investment power with his wife. (6)(7)Includes 52,500 shares of performance-based restricted stock subject to forfeiture. (8) Includes options to purchase 12,000 shares of common stock exercisable within 60 days, 1,079 shares of common stock held in our 401(k) Plan and 30,000 shares of vested restricted stock units for which common stock will be delivered to Mr. Glandon in the event of termination from Methode under any circumstance. (7)Includes 72,000 shares of performance-based restricted stock subject to forfeiture. (8)Includes options to purchase 12,000 shares of common stock exercisable within 60 days, 30,00090,000 shares of vested restricted stock units for which common stock will be delivered to Mr. Khoury in the event of termination from Methode under any circumstance and 135,000144,000 shares of performance-based restricted stock subject to forfeiture.(9) Reflects shares of performance-based restricted stock subject to forfeiture. (10) Includes 34,830 shares held jointly with Mr. Kill’s wife, options to purchase 12,0008,000 shares of common stock exercisable within 60 days, 30,00042,000 shares of vested restricted stock units for which common stock will be delivered to Mr. KillTsoumas in the event of termination from Methode under any circumstance, and 135,00075,500 shares of performance-based restricted stock subject to forfeiture.forfeiture and 12,038 shares of common stock held in our 401(k) Plan.(10)(11) Includes 94,32227,000 shares held jointly, with Mr. Koman’s wife and 25,470 shares of performance-based restricted stock subject to forfeiture.(11)Includes 163,704 shares held jointly, 34,83052,160 shares held in trust with voting and investment power shared with a spouse, options to purchase 76,00060,000 shares of common stock exercisable within 60 days, 1,079577,055 shares of vested restricted stock units, 765,500 shares of performance-based restricted stock subject to forfeiture, 17,730 shares of phantom stock held in the Company’s Deferred Compensation Plan and 12,038 shares of common stock held in our 401(k) Plan, 391,812 shares of vested restricted stock units and 637,470 shares of performance-based restricted stock subject to forfeiture. 10 Plan.eighttwelve directors will be elected at the annual meeting.Annual Meeting. Each director will hold office until the next annual meeting of shareholders andstockholders, or until any such director’s earlier resignation or until his or her successor is elected and qualified. All of the nominees listed below currently serve as directors. All of the nominees were recommended unanimously to our Board of Directors by our Nominating and Governance Committee and were nominated by our Board of Directors. Mr. Batts will not be standing for re-election, and the Board expressed its great appreciation for all of the contributions he has made over the years. The size of the Board will be reduced from nine directors to eight directors as of the date of the annual meeting. If any of these nomineesnominee is notunwilling or unable to serve as a candidate for election at the annual meeting,director, an event which our Board of Directors does not anticipate, shares represented by the proxies will be voted for a substitutethe election of another nominee recommended tonominated by our Board upon the recommendation of Directors by our Nominating and Governance Committee, or the Board may reduce the size of the Board and nominated by our Boardthe number of Directors.Walter J. Aspatore, ChairmanChairman Emeritus,Amherst Partners, LLCDirector since 2008Age 74Mr. Aspatore has served as Chairman Emeritus of Amherst Partners, LLC, a business consulting firm, since 2010. Prior thereto, Mr. Aspatore was Chairman of Amherst Partners from 1994 through 2010. Mr. Aspatore has served as Chairman of our Board since 2012. Prior to co-founding Amherst Partners, Mr. Aspatore served in various officer positions at diversified manufacturing and technology businesses, including Cross and Trecker Corporation, the Warner and Swasey Company, Bendix Corporation and TRW Corporation. He also served as Vice Chairman and President of Onset BIDCO, a venture capital and subordinated debt fund, from 1992 to 1994. Mr. Aspatore also serves as a director of Mackinac Financial Corporation, a bank holding company. Mr. Aspatore’s consulting experience and service at various consulting, manufacturing and technology businesses has resulted in continued contributions to the Board.Dr. Darren M. DawsonLeroy C. and Aileen H. Paslay Dean,College of Engineering,Kansas State UniversityDirector since 2004Age 54Dr. Dawson has served as the Dean of the College of Engineering of Kansas State University since July, 2014. Prior thereto, Dr. Dawson served as a Professor in the Electrical and Computer Engineering Department at Clemson University, where he held various professor positions since 1990. His research interests include nonlinear control techniques for mechatronic systems, robotic manipulator systems and vision-based systems. Dr. Dawson’s work has been recognized by several awards, including the Clemson University Centennial Professorship in 2000. Dr. Dawson’s academic and technical background has provided the basis for continued contributions to the Board’s operations and deliberations.Donald W. DudaChief Executive Officer and President,Methode Electronics, Inc.Director since 2001Age 62Mr. Duda has served as our Chief Executive Officer since 2004 and our President since 2001. Mr. Duda joined us in 2000 and served as our Vice President - Interconnect Products Group. Prior to joining Methode, Mr. Duda held several positions with Amphenol Corporation, a manufacturer of electronic connectors, most recently as General Manager of its Fiber Optic Products Division from 1988 through 1998. Mr. Duda has used his executive background and unique understanding of Methode to contribute to the Board.11 Martha Goldberg AronsonFormer Executive Vice President and President of Global HealthcareEcolab, Inc.Director since April 2016Age 49Ms. Goldberg Aronson served from 2012 to 2016 as Executive Vice President and President, Global Healthcare, at Ecolab, Inc., a specialty chemical company. From 2010 to 2012, Ms. Goldberg Aronson was President, North America at Hill-Rom Holdings, Inc., a global medical technology company. Prior to Hill-Rom, Ms. Goldberg Aronson spent 18 years at Medtronic, Inc., a medical technology provider, most recently serving as Senior Vice President and Chief Talent Officer. Ms. Goldberg Aronson is currently a member of the Board of Directors of Cardiovascular Systems, Inc., Conmed Corporation and the Guthrie Theater. Ms. Goldberg Aronson served as a director of Hutchinson Technology, Inc. from 2010 through 2016. Based on her extensive leadership experience and experience in the global health care markets, Ms. Goldberg Aronson has provided valuable insights to the Board.Isabelle C. GoossenRetired Vice President and Chief Financial Officer,Chicago Symphony Orchestra AssociationDirector since 2004Age 65Ms. Goossen served as the Chief Financial Officer for the Chicago Symphony Orchestra Association from March, 2011 thru March, 2017. Ms. Goossen served as the Vice President for Finance and Administration for the Chicago Symphony Orchestra Association from 2001 thru March, 2017. From 1986 through 1999, Ms. Goossen held several management positions with Premark International, Inc., a diversified consumer products company, most recently as Vice President and Treasurer from 1996 through 1999. Ms. Goossen serves as a director of the Columbian Financial Group, the parent company of Columbian Mutual Life Insurance and Columbian Life Insurance Company, each a life insurance company. In addition, Ms. Goossen is a trustee of Knox College and a director of the Cook County Health Foundation. Ms. Goossen has used her financial expertise and management background to make continued contributions to the Board.Christopher J. Hornung, Vice ChairmanCo-Founder,Sturbridge CapitalDirector since 2004Age 65Mr. Hornung co-founded Sturbridge Capital, an investment fund, in 2011. Mr. Hornung served as Chairman of Doskocil Manufacturing Company Inc., doing business as Petmate, a producer and distributor of pet products, from 2010 to May, 2017. Prior thereto, Mr. Hornung served as Chief Executive Officer of Next Testing, Inc., a provider of comprehensive, sport-specific athletic testing programs, from January 2007 to November 2013. From February 2004 through December 2006, Mr. Hornung served as President of the Pacific Cycle Division of Dorel Industries, Inc., a global consumer products company. Prior to the acquisition of Pacific Cycle by Dorel Industries Inc., Mr. Hornung served as the Chairman and Chief Executive Officer of Pacific Cycle. Mr. Hornung is a recipient of the Ernst & Young Entrepreneur of the Year Award and serves on an advisory board of the University of Wisconsin School of Business. His executive and entrepreneurial experience as well as his expertise regarding international sourcing and distribution has resulted in continued contributions to the Board.
Walter J. Aspatore, Chairman12 Paul G. SheltonRetired Vice President and Chief Financial Officer,FleetPride, Inc.Director since 2004Age 67Mr. Shelton retired in 2003 as Vice President and Chief Financial Officer of FleetPride Inc., an independent heavy-duty truck parts distributor. From 1981 through 2001, Mr. Shelton served in various management positions at AMCOL International Corporation, a supplier of specialty minerals and chemicals, most recently as Senior Vice President from 1994 through 2001 and Chief Financial Officer from 1984 through 2001. Mr. Shelton serves on two private company boards and was a former member of the board of directors of AMCOL International Corporation and six private companies. Mr. Shelton has used his executive, financial and board experience to contribute to the operations and deliberations of the Board. Lawrence B. SkatoffRetired Executive Vice President and Chief Financial Officer,BorgWarner Inc.Director since 2004Age 77Mr. Skatoff retired in 2001 as Executive Vice President and Chief Financial Officer of BorgWarner Inc., a manufacturer of highly engineered systems and components for the automotive industry. Prior to joining BorgWarner Inc., Mr. Skatoff was Senior Vice President and Chief Financial Officer of Premark International, Inc., a diversified consumer products company, from 1991 through 1999. Before joining Premark, Mr. Skatoff was Vice President-Finance of Monsanto Company, a worldwide manufacturer of chemicals and pharmaceuticals. Mr. Skatoff’s executive experience and financial background has led to continued contributions to the Board.
Director since 200813
Age 78Ernst & YoungEY to serve as our independent registered public accounting firm for the fiscal year ending April 28, 2018,30, 2022, subject to ratification of the selection by our shareholders. Ernst & Youngstockholders. EY has served as our independent registered public accounting firm for many years and is considered to be well qualified.Ernst & YoungEY will be present atattend the annual meeting,Annual Meeting, will have the opportunity to make a statement and will be available to respond to appropriate questions.shareholdersstockholders do not ratify the selection of Ernst & Young,EY, our Audit Committee will reconsider the selection. Even if the selection is ratified, our Audit Committee may select a different independent registered public accounting firm at any time during the year if it determines that a change would be in the best interests of Methode and our shareholders.ERNST & YOUNGEY AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.14 proposaladvisorYexecutive compensationshareholdersstockholders with the opportunity to vote to approve, on a nonbinding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement, commonly known as a “say-on-pay” vote.“Executive Compensation – Compensation“Compensation Discussion and Analysis,” we seek to align the interests of our executives with the interests of our shareholdersstockholders and reward performance.shareholdersstockholders and our Compensation Committee will consider the outcome of the vote when making decisions concerning executive compensation.Shareholders may vote for or against the following resolution, or may abstain from voting. The affirmative vote of a majority of the shares present or represented at the annual meeting and entitled to vote is required to approve the proposed resolution.shareholdersstockholders to approve the following resolution:20172021 Annual Meeting of ShareholdersStockholders pursuant to the SEC’s compensation disclosure rules, including the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosure, is hereby approved.”Our Board of Directors recommends a votethe approval of theTHE APPROVAL OF THE FOREGOING RESOLUTION.15 PROPOSAL FOURADVISORY VOTE ON THE FREQUENCY OFFUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATIONSection 14A of the Securities Exchange Act of 1934 provides that shareholders must be given the opportunity to vote, on a non-binding, advisory basis, on how frequently the advisory vote on executive compensation should be presented to our shareholders, commonly known as “say-on-pay” votes. Shareholders may indicate whether they would prefer that we conduct future “say-on-pay” votes once every one, two or three years. Shareholders also may abstain from casting a vote on this proposal.We are required to hold an advisory vote regarding the frequency of “say-on-pay” votes every six years. The Company’s shareholders were provided with the opportunity to vote on the frequency of “say-on-pay” votes in 2011. At such time, the shareholders voted in favor of holding “say-on-pay” votes annually and the Board adopted this standard.After consideration of each alternative, the Board recommends that the advisory vote on executive compensation continue to be submitted to the shareholders every year. Our Board of Directors has determined that an annual advisory vote on executive compensation will allow our shareholders to provide timely input on Methode’s executive compensation philosophy, policies and practices as disclosed in the proxy statement each year.The proxy card provides shareholders with the opportunity to choose among four options (holding the vote every one, two or three years, or abstaining). Shareholders will not be voting to approve or disapprove the recommendation of the Board of Directors.While this vote is advisory and not binding on Methode, the Board and the Compensation Committee expect to consider the outcome of the vote, along with other relevant information, in determining the frequency of future advisory votes on executive compensation. Notwithstanding the Board’s recommendation and the outcome of the shareholder vote, the Board may in the future decide to conduct advisory votes on a less frequent basis.Our Board of Directors recommends a vote for a one-year frequency of the advisory vote on executive compensation. 16 Goossen,Bobek, Ms. Lindsey, Mr. SheltonSchwabero and Mr. Skatoff as audit committee financial experts as defined by the SEC. In fulfilling its oversight responsibilities, our Audit Committee reviewed and discussed the audited financial statements in the Annual Report on Form 10-K for the year ended April 29, 2017May 1, 2021 with management, including a discussion of the quality, not just the acceptability, of the accounting principles; the reasonableness of significant judgments; and the clarity of disclosures in the financial statements.Ernst & Young,EY, which is responsible for expressing an opinion on the conformity of the audited financial statements with U.S. generally accepted accounting principles, the firm’s judgments as to the quality, not just the acceptability, of our accounting principles and such other matters as are required to be discussed under the standards of the Public Company Accounting Oversight Board (United States).Ernst & YoungEY required by applicable requirements of the Public Company Accounting Oversight Board regarding Ernst & Young’sEY’s communications with the Committee concerning independence, and has discussed with Ernst & YoungEY the firm’s independence from management and Methode and considered the compatibility of nonauditnon-audit services with the firm’s independence.Ernst & YoungEY the overall scope and plans for their respective audits. Our Audit Committee met with the internal auditors and Ernst & Young,EY, with and without management present, to discuss the results of their examinations, their evaluations of our internal controls, and the overall quality of our financial reporting. The Committee also discussed with Ernst & YoungEY the matters required to be discussed byunder the Public Company Accounting Oversight Board Auditing Standard No. 1301, Communications with Audit Committees - Public Company Accounting Oversight Board. (AS 1301). In reliance on the reviews and discussions referred to above, the Committee recommended to our Board of Directors (and our Board has approved) that the audited financial statements be included in the Annual Report on Form 10-K for the year ended April 29, 2017May 1, 2021 filed with the SEC.AUDIT COMMITTEEIsabelle C. Goossen, ChairWalter J. AspatorePaul G. SheltonLawrence B. Skatoff17 Ernst & YoungEY to examine our consolidated financial statements for the fiscal year ended April 29, 2017.May 1, 2021. Fees paid to Ernst & YoungEY for services performed during the 20172021 and 20162020 fiscal years were as follows: Fiscal 2017 Fiscal 2016 Audit Fees (1) $2,589,140 $1,960,702 Tax Fees (2) $25,593 $52,039 All Other Fees -- -- Total $2,614,733 $2,012,741 (1) Audit fees represent aggregate fees billed for professional services rendered by Ernst & YoungEY for the audit of our annual financial statements and review of our quarterly financial statements, audit services provided in connection with other statutory and regulatory filings and consultation with respect to various accounting and financial reporting matters and transaction advisory services.matters.(2) Tax fees primarily include fees for consultations regarding intercompany transfer pricing. Ernst & YoungEY and shall not engage Ernst & YoungEY to perform non-audit services proscribed by law or regulation. In fiscal 2017,2021, 100% of audit and non-audit services were approved by the Audit Committee.18 Overview2017.2021. Our fiscal 20172021 named executive officers included Donald W. Duda, President and Chief Executive Officer; John R. Hrudicka,Ronald L.G. Tsoumas, Chief Financial Officer; Joseph E. Khoury, Senior Vice President; Theodore P. Kill,Chief Operating Officer; Andrea J. Barry, Executive Vice President Worldwideand Chief Human Resources Officer; and Kevin M. Martin, Vice President, North America. Mr. Martin was appointed an executive officer in September 2020 and Ms. Barry was promoted to Executive Vice President in June 2021.President of Dabir Surfaces; Timothy Glandon, Vice President;growth-focused capital allocation strategy. We maintain a strong balance sheet and Douglas Koman,pay down indebtedness when appropriate to reduce leverage. We return capital to our retired Chief Financial Officer. In July 2016, Mr. Koman resigned as Chief Financial Officerstockholders through dividends and Mr. Hrudicka was hiredstock buyback programs, such as our new Chiefrecently announced $100 million stock buyback program. We invest in organic growth through R&D and capital expenditures. We actively seek accretive acquisitions to enhance and grow our businesses.Officer. Mr. Koman retired asHighlights. Despite the impact from the COVID-19 pandemic and supply chain disruptions, we reported record fiscal 2021 net sales of $1.09 billion and reported net income of $122.3 million. For fiscal 2021, our quarterly dividend rate was $0.11 per share, and we distributed dividends of $16.5 million to our stockholders. In addition, we purchased 167,949 shares of our common stock in fiscal 2021 through our stock buyback program, for an employee in September 2016.Executive Summaryshareholdersstockholders and appropriately reward our executives for performance against annual and multi-yearlong-term objectives.our the fiscal 20172021 compensation program for our namednamed executive officers included the following:are as follows:• reviewing fiscal 2017April 2020, the salaries forof our named executive officers our Compensation Committee discussed retention issues, reviewed advice from its compensation consultant regarding market practices and considered Mr. Duda’s recommendations for officers other than himself. The Compensation Committee also considered other relevant factors, includingwere reduced twenty percent (20%) in connection with cost-cutting measures related to the individual performance, skills and experience of each executive, internal pay equity issues, andCOVID-19 pandemic. In July 2020, the Company’s performance. The Compensation Committee decided not to increase the base salaries of our named executive officers for fiscal 2021 and to continue the twenty percent (20%) salary reduction. The executive officers’ full base salaries were reinstated at the end of each of Messrs. Duda, Khoury, KillAugust 2020 for Mr. Martin and Koman by 3.0%. Thein mid-September 2020 for our other named executive officers. In September 2020, the Compensation Committee setincreased Mr. Hrudicka’sMartin’s salary by approximately 14% in connection with hiring him as our Chief Financial Officer.his promotion to executive officer and the related increase in his responsibilities. Details regarding these salaries are described below under “Components of Fiscal 2021 Compensation – Salary.”• After considering the guideline benchmark target,Our named executive performance, retention issues, internal pay equity, market conditions, the advice of our independent compensation consultant and Mr. Duda’s recommendations for the other officers the Compensation Committee made fiscal 2017were awarded annual performance-based cash bonus awards. For Messrs. Duda, Hrudicka, Khoury and Koman, 70% of theopportunities for fiscal 2021. The target bonus was based on an adjusted pre-tax income measure for the Company and 30% was based on sales objectives and/or individual objectives. For Mr. Kill, 25% of the target bonus was based on the Company pre-tax income measure and 75% was based on performance measures related to our Dabir Surface medical device products. The maximum amount payable with respect to the Company pre-tax income measure was set at 100% of base salary for Mr. Duda, 75% for Mr. Khoury and 66% for our other named executive officers. The threshold and maximum amounts payable were set at 50% and 200%, respectively, of the amount payable at the target level of performance. The annual performance measures included new business bookings, management of the uncertainties and challenges of the COVID-19 pandemic, financial objectives and individual performance objectives. Details regarding these awards are described below under “Components of Fiscal 2021 Compensation – Annual Performance-Based Bonuses.”.• aligntransition the Company from the pre-pandemic economy through the extended recovery and to provide a bridge of unvested value for the period between the vesting of the 2015 LTI program awards and the adoption of the 2021 LTI Program, the Compensation Committee granted transition awards to our executive officers. The award with competitive practice among the peer group. Due to Mr. Koman’s retirement, he was entitledis a cash opportunity equal to a pro-rata paymentmultiple of the executive’s base salary as follows: Mr. Duda, 2.0 times; Mr. Khoury, 1.75 times; Mr. Tsoumas and Ms. Barry, 1.5 times; and Mr. Martin, 1.25 times. If the executive remains employed by the Company and maintains satisfactory job performance, forty percent (40%) of his annual bonus basedthe transition award will be paid on his retirement dateApril 30, 2022, and the performance achieved with respect to the measuressixty percent (60%) will be paid on April 29, 2023. Details regarding these awards are described below. In connection with his hiring, Mr. Hrudicka was guaranteed a minimum bonusbelow under “Components of $150,000 for fiscal 2017.Fiscal 2021 Compensation – Transition Awards.”• Fiscal 20162021 LTI Program. OurIn September 2020, after reviewing various design alternatives and market practices and considering the performance of our two prior five-year, equity program consists of a mix of 60% performance-based restricted stock awards (“RSAs”), at target performance, and 40% time-based restricted stock units (“RSUs”). Thelong-term incentive programs, our Compensation Committee expects the Fiscal 2016 LTI Program to cover alladopted a five-year, long-term incentive grants toprogram (the “2021 LTI Program”). After careful consideration, the participants throughCompensation Committee determined that another five-year program was appropriate after reviewing our shareholders’ strong say-on-pay support of the end of fiscal 2020 (i.e., five fiscal years). The number of RSAs earned will be based onprior programs, the achievement of established goals for the Company’s earnings before net interest, taxes, fixed asset depreciation and intangible asset amortization (“EBITDA”) for fiscal 2020. The EBITDA performance goals under the Fiscal 2016 LTI Program were designed to align with the Company’s targeted annual growth rate for EBITDA of 9% to 10% for the period. The RSUs are subject to vesting based on continued service with no RSUs vesting prior to the end of fiscal 2018, subject to acceleration in certain limited circumstances.positiveshareholders.19
stockholders. •No excessive post-termination benefits: Our executives do not participate in pension plans or receive other post-retirement benefits, nor do they generally have employment or severance agreements (other than in connection with changesignificant amount of control).compensation that is “at risk” based on performance No “single trigger” change control benefits: We maintain “double-trigger” change of control agreements,short-term and the executives are only entitled tolong-term compensation severance payment if“clawback” policy for incentive compensation executive is terminated without cause orannual “say-on-pay” advisory vote executive terminates for good reason subsequent to a change of control. In addition, awardsannual compensation risk assessment Fiscal 20162021 LTI Program do not automatically vest upon a change in control.Program • : We do not provide for gross-up payments for excise taxes our executive officers may incur upon change in connection with a changecontrol control.control benefits Robust performance-based incentives: In general, a significant amount of each of our named executive officer’s compensation is variable compensation and “at risk” for non-payment if we fail dividends or the executive fails to meet performance targets. Consistent with our pay-for-performance philosophy, approximately 56.5% of our Chief Executive Officer’s fiscal 2017 compensation is composed of performance-based compensation, consisting of one-fifth of the grant date fair value of the fiscal 2016 performance-based RSAs (at target performance), and the annual performance-based cash bonus.•Disclosure of performance measures: We disclose the performance measures for the RSAs awarded pursuant to the Fiscal 2016 LTI Program and our fiscal 2017 performance-based annual bonuses in this Compensation Discussion and Analysis.•Equity compensation best practices: Our 2014 Omnibus Incentive Plan contains certain restrictions that reflect sound corporate governance principles, including the following:−dividendsdividend equivalents on performance-basedunearned stock awards and dividend equivalents on performance-based unit awards are paid only to the extent the underlying awards vest; andby executives or directors −awards to employees are subject to the following minimum vesting requirements: (i) stock options, performance-based restricted stock, restricted stock units or performance units − at least one year; and (ii) time-based restricted stock, restricted stock units or performance units − at least three years, with no more frequent than ratable vesting over the vesting period. The minimum vesting requirements are not applicable in the event vesting is accelerated under certain circumstances such as death or disability, and the plan provides for an exception to the minimum vesting requirement for up to ten percent (10%) of the number of shares authorized for issuance under the plan. •Use of an independent compensation consultant: The Compensation Committee directly engages an independent compensation consultant to review the competitiveness and effectiveness of our executive compensation program. excessive perquisites•Executive officer stock ownership requirements: We require all of our executive officers to hold substantial amounts of our common stock. Our Chief Executive Officer is expected to own stock with a value at least equal to six (6) times his base salary. In addition, shares of common stock underlying the RSUs awarded under the Fiscal 2011 LTI Program (described below) and the Fiscal 2016 LTI Program will not be delivered to the executive until the earlier of the executive’s termination of employment or a change of control of Methode.•Incentive “clawback” policy: In the event we are required to restate our financial statements due to material noncompliance, our Incentive Compensation Recoupment Policy requires us to recover from our current or former executive officers certain amounts of incentive-based compensation paid within the prior three years.•Policy prohibiting hedging or pledging our stock: Our Insider Trading Policy prohibits our directors, executive officers and certain key employees from engaging in certain transactions involving our common stock, including options trading, short sales, derivative transactions and hedging transactions. In addition, these directors, executive officers and key employees are20 prohibited from holdingcommon stock innamed executive officers’ compensation is “at risk” for non-payment if we fail or the executive fails to meet established performance targets. The following charts illustrate the components of fiscal 2021 compensation as a margin account or otherwise pledgingpercentage of total target compensation for our common stockChief Executive Officer and for our other named executive officers as collaterala group. For this purpose, total target compensation is the sum of an executive officer’s salary, target annual performance-based cash bonus opportunity, and one-fifth of the market value of the target RSA’s as of the grant dates and one-fifth of the grant date fair value of the RSUs. Performance Units are not included as they are only earned for above-target performance; below target performance will yield a loan.
shareholderstockholder value through a competitive program that attracts and retains high-quality talent and rewards executives for demonstrating strong leadership and delivering results. Our executive compensation program is designed to:for pre-tax incomeincluding new business bookings and new sales, and in certain cases, individual objectives.objectives, as adjusted for certain acquisitions and divestitures.objectives.shareholderstockholder interests by providing for capital accumulation through awards of RSAs and RSUs and encourage significant ownership of our common stock by our executive officers.and meetsthat meet as often as necessary to perform itstheir duties. In fiscal 2017,2021, our Compensation Committee met fivenine times. Ourcompensation.compensation relative to peers and survey data. Our Compensation Committee also annually reviews company performance relative to peers and survey data. compensation elements with respect to Mr. Duda’s compensation. For named executive officers other than Mr. Duda, compensation packages are developed and recommended by Mr. Duda, in consultation with the Chief FinancialHuman Resources Officer, based on guidelines provided by our Compensation Committee. Our Compensation Committee determines whether to approve these recommendations, subject to any modifications that it may deem appropriate.FWC”FW Cook”) has provided independent executive compensation consulting services to the Compensation Committee. FWCFW Cook is retained by and reports to the Compensation Committee. During fiscal 2017, FWC2021, FW Cook provided the following services:group to be used for evaluating compensation decisions;group;program;program, including the 2021 LTI Program;advised the Compensation Committee on setting compensation for Mr. Hrudicka, our new Chief Financial Officer;Fiscal 2016multi-year LTI Program;Programs;21 reviewed and advised the Compensation Committee regarding regulatory, governance, disclosure and other technical matters.FWCFW Cook addressing the independence of FWCFW Cook and the representatives serving the Committee. Based on this information, the Compensation Committee concluded that the work performed by FWCFW Cook and its representatives involved in the engagement did not raise any conflict of interest and that FWCFW Cook and such representatives are independent from the Company’s management.20162020 Say-on-Pay Vote Results. At our 2016 annual meeting,2020 Annual Meeting, our shareholdersstockholders approved our fiscal 20162020 executive compensation, with approximately 95% of voted shares cast in favor of the say-on-pay resolution. Our Compensation Committee considered the results of the 20162020 say-on-pay vote along with other factors when making executive compensation decisions.Market BenchmarkingPositioning of Fiscal 2017 Executive CompensationWe strive to provideits independent compensation opportunities that are market competitive. In order to assistconsultant, annually considers potential risks when reviewing our compensation programs for all employees, including our executive officers. Based on this assessment, the Compensation Committee in achieving this objective forconcluded that our fiscal 2017, FWC was retained to conduct a review of our executive2021 compensation peer group and benchmark our executive compensation program using a custom peer group and third-party survey data. The Compensation Committee considers this benchmarking information in reviewing each element of our compensation program.After considering the advice of FWC, the Compensation Committee approved using the fiscal 2016 peer group for fiscal 2017, subject to a few modifications. One former peer company, Remy International, Inc., was eliminated since it had been acquired. Two new peer companies, AVX Corporation and Multi-Fineline Electronix, Inc., were added. Each of the new peer companies satisfies the Compensation Committee’s criteria for the peer group as summarized below.The peer group used for benchmarking purposes in fiscal 2017 was selected using the following criteria:Size as measured by revenue – we generally targeted companies with revenueprograms do not less than half nor more than two times our annual revenue.Size as measured by market capitalization – we generally targeted companies with market capitalization not less than one-third nor more than three times our market capitalization.Similar-type businesses – we generally targeted companiescreate risks that are multinational and engage in businesses with similar technology, products and markets.For compensation decisions affecting fiscal 2017 compensation,reasonably likely to have a material adverse effect on the peer group included the following companies:AVX CorporationIPG Photonics CorporationRogers CorporationCTS CorporationLittelfuse, Inc.Standard Motor Products, Inc.Dorman Products, Inc.MTS Systems CorporationStoneridge, Inc.Drew Industries, IncorporatedMulti-Fineline Electronix, Inc.TTM Technologies, Inc.Franklin Electric Company, Inc.OSI Systems, Inc.Universal Electronics Inc.Gentherm Incorporated
Company. In benchmarking our compensation program for fiscal 2017,making this determination, the Compensation Committee reviewed information compiled by FWC from the following third-party executive pay surveys: (i) 2015 Mercer Executive Benchmark; (ii) 2015 Aon Hewitt Total Compensation Management; (iii) 2015 Willis Towers Watson U.S. Compensation Data Bank;key features of our compensation programs and (iv) 2015 Willis Towers Watson Top Management.As a general policy, we targeted fiscal 2017 executive officer total direct compensation (salary, annual cash bonus and long-term incentive compensation) and each component thereof inpolicies, including the 50th to 75th percentile range of competitive practice, which aligned with the Company’s relative positioning in terms of revenues, net income and market capitalization versus its peer group. In making benchmarking determinations for fiscal 2017 compensation, thefollowing:assumed that each executive would achieve the target level of performance under all performance-based awards. In addition, in valuing the RSAis independent and RSU awards outstanding under the Fiscal 2016 LTI
utilizes an independent compensation consultant.22 Program, the Compensation Committee assumed each executive would achieve the target level of performance under the RSAs and included one-fifth of the grant date fair value of these shares in these comparative calculations since the Fiscal 2016 LTI Program is intended to cover all long-term incentive grants to the participants through fiscal 2020. For Mr. Hrudicka, one-fourth of the grant date fair value of these shares is included due to his mid-cycle hiring date.In setting each compensation component for our executive officers the Compensation Committee considered the competitive market data, together with other relevant factors, including the individual performancerepresents a balanced mix of short-term, long-term and experience of each executive, retention issues, internal pay equity and consistency issues, the Company’s performance, expected future contributions of each executive, historical compensation levels, tenure and industry conditions. These and other factors may affect whether one or more of the compensation components for any of our executive officers falls outside of the benchmark range. In addition, the total direct compensation, annual cash bonus and long-termat-risk compensation.compensation for one or more of our executive officers could be above or below this target range depending on the amounts earned under the performance-based awards.Consistent with our pay-for-performance philosophy, our executive compensation program is generally structured so that a significant amount of each of our named executive officers’ compensation is variable compensation and “at risk” for non-payment if we fail, or the executive fails,programs are designed to meet performance targets.Components of Fiscal 2017 CompensationSalary. Our Compensation Committee establishes salaries onavoid an annual basis, taking into account the guideline benchmark target, levels of responsibility, prior experience and breadth of knowledge, potential for advancement, recent promotions, past performance, internal equity issues and external pay practices. In setting fiscal 2017 salary levels, the Compensation Committee reviewed advice from FWC regarding market practices and considered Mr. Duda’s recommendations for officers other than himself.After deliberation, the Compensation Committee decided to increase the salary of each of Messrs. Duda, Khoury, Kill and Koman by 3.0%. The Compensation Committee set Mr. Hrudicka’s salary in connection with hiring him as Chief Financial Officer. The Compensation Committee maintained Mr. Glandon’s salary at the same level for fiscal 2017 as fiscal 2016.Annual Performance-Based Bonuses. In July 2016, our Compensation Committee established fiscal 2017 annual performance-based cash bonus opportunities for certain of our executive officers after considering the guideline benchmark target, the individual performance and experience of each executive, retention issues, internal pay equity and industry conditions. The Compensation Committee reviewed advice from FWC regarding market practices and considered Mr. Duda’s recommendations for officers other than himself. In setting the performance measures, our Compensation Committee considered, among other matters, past performance, the fiscal 2017 operating budget, Methode’s strategic plan, product development matters and general economic conditions. The Compensation Committee determined that 70% of the target annual performance-based cash bonus for Messrs. Duda, Hrudicka, Khoury and Koman would be basedover emphasis on a Company pre-tax income measure (as adjusted for acquisitions and related expenses and divestitures and related gains/losses and expenses) and 30% would be based on sales objectives and/or individual objectives. For Mr. Kill, 25% of the target annual performance-based cash bonus would be based on the Company pre-tax income measure and 75% would be based onsingle performance measures related to our Dabir Surface medical device products described below. metric.with respect to the Company pre-tax income measure was set at 200% of the amount payable at the target level of performance in order to align the award with competitive practice among the peer group. Due to Mr. Koman’s retirement, he was entitled to a pro-rata payment of his annual bonus based on his retirement date and the performance achieved with respect to the measures described below. In connection with his hiring, Mr. Hrudicka was guaranteed a minimum bonus of $150,000 for fiscal 2017. The Compensation Committee did not provide for an annual performance-based bonus opportunity for Mr. Glandon for fiscal 2017.Set forth below is an outline ofunder the annual performance-based cash bonus awards for fiscal 2017 performance, including the maximum bonus, the relevant performance measures and the bonus paid. As a resultbonuses is capped at 200% of Mr. Koman’s retirement, the amounts set forth below have been adjusted pro rata based on his September retirement date.
target.23
ExecutiveMaximum Bonus Performance Measures and Amounts Payable* Bonus Earned $1,217,383 $955,541 John R. Hrudicka $504,900 $396,303 Joseph E. Khoury $408,020 $320,261 Theodore P. Kill $263,210 $156,749 Douglas A. Koman $175,788 $138,307 * Payouts are interpolated for performance falling between established performance objectives.Other Benefits and Perquisites. Our U.S.-based executive officers are eligible to participate in allA significant component of our employee benefit plans, such as medical, dental, vision, group life, disability and, as applicable, our 401(k) savings plan (with a company contribution equal to three percent (3%) of salary, subject to certain limitations), in each case,24 on the same basis as our other employees. Our U.S.-based executive officers are also provided deferred compensation opportunities through a non-qualified Deferred Compensation Plan. We have never contributed any amounts to the Deferred Compensation Plan on behalf of any of the named executive officers. For a description of the Deferred Compensation Plan, please see “Executive Compensation — Nonqualified Deferred Compensation,” below. In addition, a few perquisites are provided to the named executive officers. Perquisites include a company car allowance, professional association dues and provision for an annual physical exam.Change of Control Arrangements. We have entered into change of control agreements with all of our named executive officers, other than Mr. Khoury, that provide certain benefits upon termination in connection with a change of control event, including Mr. Hrudicka upon his hiring in fiscal 2017. As a Lebanese resident, Mr. KhouryLTI Programs is entitled to certain payments in the event of his termination under the Lebanese Labor Laws. These change of control agreements are designed to promote stability and continuity of senior management if a change of control event were to occur, both of which are in the best interest of Methode and our shareholders. Our executives are not entitled to a gross-up payment for excise taxes under our change of control agreements. In addition, our change of control agreements are “double trigger” whereby the executives are only entitled to a severance payment if an executive is terminated without cause or an executive terminates for good reason subsequent to a change of control. Our change of control provisions for the named executive officers are summarized below under “Executive Compensation − Potential Payments Upon Termination or Change of Control.”Fiscal 2016 Long-Term Incentive ProgramDuring fiscal 2016, our Compensation Committee adopted a five-year, long-term incentive program consisting of a mix of 60% performance-based RSAs, at target performance, and 40% time-based RSUs (the “Fiscal 2016 LTI Program”). Mr. Hrudicka received an award under the Fiscal 2016 LTI Program in fiscal 2017. The number of RSAs earned will vary based on performance relative to established goals for threshold, target and maximum performance. Performance will be based on the Company’s earnings before net interest, taxes, fixed asset depreciation and intangible asset amortization (“EBITDA”) for fiscal 2020, subject to certain adjustments, including adjustments for certain acquisitions and divestitures. The RSUs are subject to a vesting period based on continued service with no RSUs vesting prior to the end of fiscal 2018, subject to acceleration in certain limited circumstances. The Compensation Committee intends for the Fiscal 2016 LTI Program to cover all long-term equity incentive grants to the participants through fiscal 2020.A key consideration of the Compensation Committee in developing the Fiscal 2016 LTI Program was the success of the prior five-year, long-term incentive program which concluded as of the end of fiscal 2015 (the “Fiscal 2011 LTI Program”). The Fiscal 2011 LTI Program included performance-based RSAs, performance-based tandem cash awards, RSUs and stock options. During the five-year period of the Fiscal 2011 LTI Program, revenues grew at an annualized rate of 18.5%, which supported annualized pre-tax profit growth and diluted earnings per share growth of 73.0% and 47.5%, respectively. In addition, we realized strong annualized total shareholder return of 34.0% during the period. During this period, our industry-leading performance reflected the introduction of numerous new products and technologies, the benefits of selective licensing and other business arrangements, the expansion of lower-cost manufacturing facilities and further vertical integration The Compensation Committee concluded that the Fiscal 2011 LTI Program succeeded in focusing our executive officers on growing the Company and appropriately rewarded our executive officers for creating value for our shareholders.The Compensation Committee intends for the Fiscal 2016 LTI Program to continue creating value for our shareholders using a long-term program that aligns pay with performance and includes a strong retention feature. In structuring the Fiscal 2016 LTI Program, the Compensation Committee considered the advice of FWC, its independent executive compensation consultant, regarding market practices, award mix and size, possible performance criteria and alternative program structures. The Compensation Committee also considered Mr. Duda’s recommendations for officers other than himself.The Compensation Committee considered multiple approaches for the Fiscal 2016 LTI program, including the use of annual grants and alternative performance periods. After careful review, the Compensation Committee determined that the five-year program is appropriate after considering the success of the Fiscal 2011 LTI Program discussed above, as well as the lengthy sales and product development cycles and significant upfront capital requirements for many of the Company’s products. The Compensation Committee believes the five-year term will focus our executive officers on the Company’s long-term objectives and retain our top executive talent over the period.25 The Fiscal 2016 LTI Program is comprised entirely of equity awards in order to directly align the interests of our executive officers with those of our shareholders. The Compensation Committee believes that the award mix of 60% performance-based RSAs, at target performance, and 40% time-vested RSUs supports the Company’s operating performance and retention objectives, respectively. Unlike the Fiscal 2011 LTI Program,stockholders.options and performance-based tandem cash awards are not components of the Fiscal 2016 LTI Program, in part due to accounting considerations, including the high costs ofownership policy requires significant stock options relative to historical grants. Instead, the Compensation Committee elected to place greater emphasis on the performance-based RSAs, which are subject to forfeiture if the performance goals are not met.The Compensation Committee applied adjusted EBITDA as the RSA performance metric because it is one of the primary operating metrics trackedownership by the Company and its shareholders. The adjusted EBITDA performance goals set forth below align with the Company’s targeted 9% to 10% annual growth rate for EBITDA for the period. The adjustments to EBITDA for acquisitions and divestitures are designed to mitigate unintended windfalls to management for transactions and also to safeguard management from unintended penalties for shareholder-friendly transactions that negatively impact the fiscal 2020 performance results.In general, the Compensation Committee targeted the Fiscal 2016 LTI Program awards in the 50th to 75th percentile range of competitive practice, which aligned with the Company’s relative positioning in terms of revenues, net income and market capitalization versus its peer group. In making these benchmarking determinations, the Compensation Committee assumed that each executive would achieve the target level of performance under the RSAs and included one-fifth of the grant date fair value of these shares in these comparative calculations. For Mr. Hrudicka, one-fourth of the grant date fair value of these shares was included due to his mid-cycle hiring date. In determining the size of the award to each of our executive officers theand directors.Committee also considered other relevant factors, including the individual performance and experience of each executive, internal pay equity and consistency issues, expected future contributions of each executive, historicalRecoupment Policy requires us to recover incentive-based compensation levels and tenure.The table below sets forth the number of target RSAs and RSUs awarded to Messrs. Duda, Hrudicka, Khoury, Kill and Koman (“Target Shares”). Mr. Glandon did not receive an award under the Fiscal 2016 LTI Program.
ExecutiveNumber of Shares Target RSAs* RSUs Donald W. Duda 180,000 120,000 John R. Hrudicka 48,000 32,000 Joseph E. Khoury 90,000 60,000 Theodore P. Kill 90,000 60,000 Douglas A. Koman 60,000 40,000 * The number of shares earned will depend on performance and may be up to 150% of this number.Performance-Based RSAs. The number of RSAs earned will vary based on performance relative to established goals for threshold performance, target performance and maximum performance. The executive will not earn any shares if threshold performance is not met. Performance will be based on the Company’s EBITDA for fiscal 2020, subject to certain adjustments. All positive EBITDA from acquisitions that close during the term of the program and that are not accretive in fiscal 2020 will be excluded. All positive EBITDA from acquisitions that close during fiscal 2019 or fiscal 2020 that are accretive in fiscal 2020 shall be included for purposes of determining fiscal 2020 EBITDA up to the target level and shall be excluded for purposes of determining fiscal 2020 EBITDA above the target level. For any divestitures approved by the Board during the period, the final four quarters of EBITDA from the divested business will be included in fiscal 2020 EBITDA. The performance measures and corresponding percentages of the target shares earned are set forth below.Performance MeasureFiscal 2020 Adjusted EBITDAPercentage of Target RSAs Earned*Threshold Performance$198.9 million50%Target Performance$221.0 million100%Maximum Performance$243.1 million150%* Payouts are interpolated for performance falling between established performance measures.26 Dividends will not be paid on the RSAs until the shares have been earned. At such time, the executive will be entitled to a dividend equivalent payment based on the dividends declared during the restricted period and the number of shares earned.In the event of an executive’s death or disability, he will earn all of the Target Shares. In the event of an executive’s qualified retirement, the executive will be eligible to earn a prorated number of shares based on the number of months during the 60-month performance period that have elapsed prior to retirement and Methode’s fiscal 2020 adjusted EBITDA. In connection with Mr. Koman’s retirement, he is eligible to earn 28.3% of his Target Shares at target performance. In the event of a change of control in which the successor company does not assume the RSAs, the executive will earn a prorated number of the Target Shares based on the number of months during the 60-month performance period that have elapsed prior to the change of control. If the successor company assumes the RSAs and, if the executive is terminated without cause or resigns for good reason within a period of time after the transaction (two years for Messrs. Duda and Hrudicka and one year for Messrs. Khoury and Kill), then the executive will earn a prorated number of the Target Shares based on the number of months during the 60-month performance period that have elapsed prior to termination of employment. The Compensation Committee believes these provisions regarding the treatment of the RSAs in the event of death, disability, retirement or a change of control reflect fairwe restate our financial statements due to material noncompliance.reasonable treatment under these scenarios based on current governance best practicesdirectors are prohibited from pledging and competitive standards.Time-Based RSUs. hedging our common stock.RSUs are subject to a vesting period based on continued service, with 30% vesting at the end of fiscal 2018, 30% at the end of fiscal 2019, and 40% vesting at the end of fiscal 2020. Following vesting, the delivery of the stock underlying the RSUs will be deferred until the earlier of the executive’s termination of employment or a change of control. Dividend equivalents will not be paid on the RSUs until the units have vested. Following vesting and until the delivery of the underlying common stock, each executive will be entitled to a quarterly payment in an amount equal to the aggregate per share cash dividend paid during the quarter multiplied by the number of vested RSUs held by the executive.In the event of an executive’s death or disability, all unvested RSUs will become immediately and fully vested. In the event of an executive’s qualified retirement, a prorated number of RSUs will vest based on the months during the 60-month vesting period that have elapsed prior to retirement. In connection with Mr. Koman’s retirement, 11,333 of his RSUs vested. In the event of a change of control in which the successor companyCompany does not assume the RSUs, all unvested RSUs will become immediately and fully vested. If the successor company assumes the RSUs and, if the executive is terminated without cause or resigns for good reason within a period of time after the transaction (two years for Messrs. Duda and Hrudicka and one year for Messrs. Khoury and Kill), then all unvested RSUs will become immediately and fully vested. The Compensation Committee believes these provisions regarding the treatment of the RSUs in the event of death, disability, retirement or a change of control reflect fair and reasonable treatment under these scenarios based on current governance best practices and competitive standards.PolicyGuidelines. Our Compensation Committee considers stock ownership by management and the directors to be an important means of linking management’stheir interests with those of our shareholders. After considering the importance ofstockholders. The guidelines for stock ownership our Compensation Committee maintains stock ownership guidelines for ouras a multiple of executive officers. The requirementsofficers’ base salaries are subject to a phase-in period in the event of a new hire or a promotion. Our Chief Executive Officer is expected to own stock with a value at least equal to six (6) times his base salary and all other executive officers are expected to own stock with a value at least equal to two (2) times their base salary. as follows: time-based RSUs are included in the calculation of stock ownership for purposes of these guidelines. The value of each executive officer’s common stock holdings is determined as of the end of each fiscal year based on the average daily closing price of Methode’s common stock for such fiscal year. All of our named executive officers were in compliance with our stock ownership guidelines for fiscal 2017.Insider Trading Policy2021, subject to the phase-in-period for new appointments and promotions.Policy With Respect to Deductibility of Compensation. Section 162(m) of the Code generally denies corporate tax deductions for annual compensation exceeding $1 million paid to certain employees (generally the27 chief executive officer and the three other most highly compensated executive officers of a public company, but excluding the chief financial officer), unless that compensation qualifies as performance-based compensation under a shareholder approved plan and meets certain other technical requirements. While it is the general intention of our Compensation Committee to maximize deductibility, our Compensation Committee seeks to make decisions that are in the best interest of Methode and its shareholders, even if those decisions do not result in full deductibility under Section 162(m).years.
In reviewing the actions taken by these executive officers to manage the COVID-19 pandemic and the relevant criteria, the Compensation Committee considered a variety of factors, including the following:
After thorough review, the Compensation Committee determined that these executive officers did an excellent job managing the unprecedented challenges and uncertainties of the COVID-19 pandemic on a global basis. The Compensation Committee noted that due to management’s timely and strategic response, the Company reported record net sales for fiscal 2021 despite the significant challenges from the COVID-19 pandemic. Because of these record results and based on management’s outstanding performance, the Compensation Committee approved the maximum level of payout for this performance measure and these executives each earned 200% of their respective target bonus amount for this measure. * In accordance with the accounting and SEC disclosure rules, the “Stock Awards” column of the Summary Compensation Table does not include any value attributable to the RSAs. For financial statement reporting purposes and based on the accounting rules, the Company will not record an expense for the RSAs until the Company determines with sufficient certainty that at least the threshold level of performance for fiscal 2025 EBITDA will be achieved. As noted above, the fiscal 2025 EBITDA target performance goal aligns with the Company’s targeted EBITDA compound annual growth rate of approximately 8% for organic and inorganic growth during the five-year program period and includes EBITDA from accretive acquisitions. * Only earned in the event the Company’s fiscal 2025 EBITDA exceeds the RSA target performance goal. * Payouts are interpolated for performance falling between the threshold and target performance measures. * Payouts are interpolated for performance falling between the target and maximum performance measures. Martha Goldberg Aronson, Chair Warren L. Batts Isabelle C. GoossenPaul G. Shelton28 our retired Chief Financial Officer and our three other most highly compensated executive officers (the “named executive officers”) for the three fiscal years ended April 29, 2017.Bonus ($)(1) All Other
Compensation
($) (7) RSAs(3) RSUs(4) Tandem Cash (5) 2017 716,108 -- -- -- -- -- 955,541 138,169 1,809,818 2016 695,588 -- 6,080,400 4,053,600 -- -- 572,102 311,114 11,712,805 2015 675,000 115,000 -- -- 599,600 3,487,200 1,147,500 429,130 6,453,430
Vice President, Corporate Finance (8)2017 346,154 -- 1,675,200 1,116,800 -- -- 396,303 12,481 3,546,938 2017 362,518 -- -- -- -- -- 320,261 14,482 697,261 2016 359,600 -- 3,040,200 2,026,800 -- -- 184,127 90,221 5,700,948 2015 352,324 65,000 -- -- 179,880 1,046,160 401,676 107,330 2,152,370 Theodore P. Kill, Vice President,
Worldwide Automotive Sales and
President of Dabir Surfaces2017 316,720 -- -- -- -- -- 156,749 37,760 511,229 2016 310,034 -- 2,704,500 1,803,000 -- -- 191,079 113,866 5,122,478 2015 295,000 65,000 -- -- 179,880 1,046,160 230,100 123,880 1,940,020 2017 295,000 -- -- -- -- -- -- 31,455 326,455 2016 295,000 -- -- -- -- -- -- 103,952 398,952 2015 295,000 50,000 -- -- 179,880 1,046,160 272,580 119,063 1,962,683 2017 197,363 -- -- -- -- -- 138,307 13,258 348,928 2016 365,855 -- 2,026,800 1,351,200 -- -- 204,539 223,893 4,172,287 2015 355,000 90,000 -- -- 239,840 1,394,880 362,165 148,817 2,590,702 (1) Reflects discretionary cash bonuses awardedFor fiscal 2021, the base salaries for our named executive officers were as follows: Mr. Duda, $782,800; Mr. Tsoumas, $412,000; Mr. Khoury, $446,608; Ms. Barry, $306,000; and Mr. Martin, $330,000 effective as of June 15, 2020. The amounts in earlythe table above reflect a 53-week fiscal 2015 byyear and a 20% base salary reduction in connection with cost-cutting measures related to the Compensation CommitteeCOVID-19 pandemic. The salary reduction terminated in lightAugust for Mr. Martin and in September for our other named executive officers.(2) Amounts include the grant date fair value of the Company’s strong fiscal 2014 performance.(2)ReflectsRSA and RSU awards under the fair value at the date of grant. The value is calculated2021 LTI Program determined in accordance with Accounting Standards Codification Topic 718, Stock Compensation (“ASC 718”). Details of the assumptions used in valuing the awards are set forth in Note 4the footnotes to our audited financial statements included in our Annual Report on Form 10-K for such fiscal year.(3)These performance-based RSAs are eligible for vesting based on fiscal 2020 EBITDA relative to established goals for threshold, target and maximum performance. At the time of the grants, we deemed achievement of target performance probable, and therefore the grant date fair values reflected above were calculated on that basis. If, instead, the RSA amounts had been calculated assuming the Company would achieve maximum performance, the grant date fair values for these RSAs would have been as follows: Mr. Duda, $9,120,600; Mr. Hrudicka, $2,512,800; Mr. Khoury, $4,560,300; Mr. Kill, $4,056,750 and Mr. Koman, $3,040,200.(4)These10-K. The RSUs are generally subject to a five-year vesting period based on continued service, with 30% vesting at the end of fiscal 2018,2023, 30% vesting at the end of fiscal 20192024 and 40% vesting at the end of fiscal 2020.2025. The RSUsRSAs are eligible for vesting based on fiscal 2025 EBITDA, as adjusted, relative to established goals for threshold and target performance. In accordance with the SEC disclosure rules, the aggregate grant date fair value of the RSAs has been determined based on the probable satisfaction of the fiscal 2025 EBITDA performance conditions at the date of grant. In accordance with ASC 718, the grant date fair value of the RSAs is zero because the Company will not eligiblerecord an expense for the RSAs until the Company determines with sufficient certainty that at least the threshold level of performance for fiscal 2025 EBITDA will be achieved. The aggregate grant date fair value of the RSAs if they were to be converted into common stock until a changevest at the target level of control or the executive officer leaves Methode.(5)Reflects amounts paid under the performance-based Tandem Cash Awards under theperformance would have been as follows: Mr. Duda, $10,605,000; Mr. Tsoumas, $2,135,140; Mr. Khoury, $4,072,320; Ms. Barry, $1,484,700; and Mr. Martin, $1,444,805. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 20112021 Compensation – 2021 LTI Program.”(6)(3)Amounts reflect annual performance-based cash bonuses. Additional details regarding these bonus awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2021 Compensation – Annual Performance-Based Bonuses.” (7)(4)Amounts included in All Other Compensation reflect the following for fiscal 2017:2021:Executive 401(k) Contribution ($) Car Allowance ($) Executive Physical ($) Gift Card ($) Mr. Duda 112,826 7,950 3,564 9,600 4,179 50 Mr. Hrudicka 0 7,950 428 0 4,053 50 Mr. Khoury 10,800 0 0 0 3,682 0 Mr. Kill 10,800 7,950 3,048 12,000 3,912 50 Mr. Glandon 10,800 7,950 552 8,400 3,753 50 Mr. Koman 3,600 4,310 1,348 4,000 0 0 29 (5) In addition, for Mr. Koman, includes payments of $5,417 pursuant to the Consulting Agreement described in footnote (8) below.(8)Effective as of July 25, 2016, Mr. Koman resigned as Chief Financial Officer and Mr. Hrudicka was hired and appointed to such office. Mr. Koman retired as an employee of the Company on September 15, 2016. On September 16, 2016, the Company and Mr. Koman entered into a Consulting Agreement pursuant to which Mr. Koman agreed to provide consulting services to the Company and was paid $250 per hour for such services. This Consulting Agreement terminated on July 28, 2017.(9)residentresident. In fiscal 2019 and 2020 we paid Mr. Khoury’s cash compensation in Euros. For purposes of the Summary Compensation Table, this cash compensation was converted from Euros to U.S. Dollars using the average exchange rate of 1.30481.1498 for fiscal 2015; 1.10852019 and 1.1083 for fiscal 2016; and 1.0926 for fiscal 2017.April 29, 2017.Name Estimated Future Payouts Under Equity Incentive Plan Awards(2) All Other Stock Awards: Number of Shares of Stock or Units(3) Threshold (#) Target (#) Maximum (#) Donald W. Duda 7/12/2016 465,470 716,108 1,217,383 -- -- -- -- -- John R. Hrudicka 7/25/2016 193,050 297,000 504,900 24,000 48,000 72,000 32,000 2,792,000 Joseph E. Khoury 7/12/2016 156,008 240,012 408,020 -- -- -- -- -- Theodore P. Kill 7/12/2016 184,247 210,568 263,210 -- -- -- -- -- Timothy R. Glandon 7/12/2016 -- -- -- -- -- -- -- -- Douglas A. 7/12/2016 67,376 103,653 175,788 -- -- -- -- -- Koman (1) Reflects the performance-based RSAs awarded under the 2021 LTI Program. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2021 Compensation – 2021 LTI Program.” (2) Reflects the Performance Units awarded under the 2021 LTI Program. Amounts shown have been determined based on the closing price for the Company’s common stock on the grant date, or if no trading occurred on such date, the closing price on the following date. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis-2021 LTI Program.” (3) Reflects the time-based RSUs awarded under the 2021 LTI Program. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2021 Compensation – 2021 LTI Program.” (4) Reflects the annual performance-based cash bonus awards pursuant to the Methode Electronics, Inc. 2014 Omnibus Incentive Plan (the “2014 Plan”). The executive officers’ bonus amounts are based on achieving certain performance measures. For purposes of this table, for any award components that include only one level of performance, we have included such amount in each of the threshold, target and maximum columns. For Mr. Koman, the amounts set forth above have been adjusted pro rata based on his retirement date.awards. Amounts earned in fiscal 20172021 by the executive officers under this award are reported in “Compensation Discussion and Analysis” and in the column titled “Non-Equity Incentive Plan Compensation-Annual Bonus” in the “Summary Compensation Table.” DetailsAdditional details regarding these bonus awards including the relevant performance measures, are set forth in “Compensation Discussion and Analysis.Analysis – Components of Fiscal 2021 Compensation – Annual Performance-Based Bonuses.”(2)Reflects restricted stock awards granted pursuant to the 2014 Plan which are eligible for vesting based on the achievement of certain financial targets for fiscal 2020 EBITDA. The unvested restricted stock awards are not entitled to payment of dividends, provided that at the time the shares vest, the executive is entitled to a payment based on the dividends declared during the restricted period and the number of shares earned.(3)Reflects restricted stock units granted pursuant to the 2014 Plan. These restricted stock units vest 30% on each of April 28, 2018 and April 27, 2019 and 40% on May 2, 2020, provided that the named executive officer remains a Methode employee. The unvested restricted stock units are not entitled to payment of dividends until they vest. The restricted stock units are not eligible to be converted into common stock until a change in control or the executive officer leaves Methode.(4)(5) Amounts representshown includes the grant date fair value as of the date of grant calculatedRSA and RSU awards under the 2021 LTI Program determined in accordance with ASC 718. Details of the assumptions used in valuing these optionsthe awards are set forth in Note 4the footnotes to our audited financial statements included in our Annual Report on Form 10-K for such fiscal year. In accordance with the SEC disclosure rules, the aggregate grant date fair value of the RSAs has been determined based on the probable satisfaction of the fiscal year ended April 29, 2017.2025 EBITDA performance conditions at the date of grant. In accordance with ASC 718, the grant date fair value of the RSAs is zero because the satisfaction of the required performance condition was not deemed probable as of the grant date.
Fiscal 2021 Incentive Awards30 Alternative SummaryIn fiscal 2021, the Compensation Table“Compensationthe Compensation Discussion and Analysis-Fiscal 2016 Long-Term Incentive Program,” inAnalysis, during fiscal 2016,2021, each of the named executive officers was awarded an annual performance-based cash bonus opportunity. The target amount payable was set at 100% of base salary for Mr. Duda, 75% for Mr. Khoury and 66% for our Compensation Committee adopted a five-year, long-term equity incentive program consisting of a mix of 60% performance-based RSAs, at target performance, and 40% time-based RSUs (the “Fiscal 2016 LTI Program”). Mr. Hrudicka received an award under the Fiscal 2016 LTI Program in fiscal 2017.othernumber of RSAs earned will vary based on performance relative to established goals for threshold target and maximum performance. Performance will be based on the Company’s earnings before net interest, taxes, fixed asset depreciationamounts payable were set at 50% and intangible asset amortization (“EBITDA”) for fiscal 2020, subject to certain adjustments for acquisitions and divestitures. The RSUs are subject to vesting based on continued service with no RSUs vesting prior to the end of fiscal 2018, subject to acceleration in certain limited circumstances. The Compensation Committee intends for the Fiscal 2016 LTI Program to cover all long-term equity incentive grants to the participants through fiscal 2020.A key consideration200%, respectively, of the Compensation Committee in developing the Fiscal 2016 LTI Program was the success of the prior five-year, long-term incentive program adopted in fiscal 2011 (the “Fiscal 2011 LTI Program”). The Fiscal 2011 LTI Program included performance-based RSAs, performance-based tandem cash awards, RSUs and stock options. The vesting of the performance-based RSAs and tandem cash awards were based on the achievement of internal enterprise value hurdles at the end of fiscal 2015. The time-based RSUs vested annually through fiscal 2015. Stock options were granted annually from fiscal 2011 through fiscal 2015.Under the SEC’s proxy statement disclosure rules, the grant date fair value of the number of RSAs eligible for vestingamount payable at the target level of performance. The annual performance measures included new business bookings, management of the uncertainties and challenges of the total number of RSUs awarded underCOVID-19 pandemic, financial objectives, and individual performance objectives. The amounts paid to the Fiscal 2016 LTI Program has been reportednamed executive officers pursuant to these awards are included in the Summary Compensation Table above in fiscal 2016 for Messrs. Duda, Khoury, Kill and Koman and in fiscal 2017 for Mr. Hrudicka. The amounts earned pursuant to the performance-based tandem cash awards under the column captioned “Non-Equity Incentive Plan Compensation.” Please see “Components of Fiscal 2011 2021 Compensation – Annual Performance-Based Bonuses” in the Compensation Discussion and Analysis above for further information regarding these awards.have been reportedAwards. As discussed in the Summary Compensation Table aboveDiscussion and Analysis, in fiscal 2015.The Company is presenting the following Alternative Summary Compensation Table in order to illustrate howSeptember 2020, the Compensation Committee views annualized total compensation underadopted the Fiscal 2016 LTI Program and the Fiscal 20112021 LTI Program. ThePlease See “Components of Fiscal 2021 Compensation Committee believes that due to the front-loaded nature of the RSA and RSU awards and the reporting of the total tandem cash award values in fiscal 2015, the compensation amounts disclosed– 2021 Long-Term Incentive Program” in the Summary Compensation TableDiscussion and Analysis above for our named executive officers other than Mr. Hrudicka overstate compensation attributable to fiscals 2015 and 2016 and understate compensation attributable to fiscal 2017. For Mr. Hrudicka, the Compensation Committee believes that the compensation amounts disclosed in the Summary Compensation Table overstate his fiscal 2017 compensation.The values inadditional information regarding this table differ from the values disclosed in the Summary Compensation Table on page 29 of this proxy statement in that the value of the RSAs and the RSUs have been annualized equally over the respective five-year periods of the programs. For Mr. Hrudicka, the value of the grants has been annualized over four years due to his mid-cycle hiring date. In addition, the amounts earned under the tandem cash awards and reported entirely as fiscal 2015 compensation in the Summary Compensation Table have been annualized, with one-fifth of the value reported in fiscal 2015. In both the Summary Compensation Table and the Alternative Summary Compensation Table, the values for the RSA and RSU awards reflect grant date fair values calculated in accordance with the applicable accounting rules. The Alternative Summary Compensation Table below has been revised as described and does not comply with SEC rules for the Summary Compensation Table. Shareholders should not view this alternative table as a substitute for the Summary Compensation Table on page 30 and should review this Alternative Summary Compensation Table together with the Summary Compensation Table and other compensation tables contained herein that have been prepared in accordance with SEC rules.
program.31 Alternative Summary Compensation TableBonus ($) (1) Non-Equity Incentive Plan Compensation ($) All Other Compensation ($)(10) Total ($) RSAs RSUs Annualized Value of Tandem Cash (8) 2017 716,108 -- 1,216,080(4) 810,720(5) -- -- 948,700 138,169 3,836,618 2017 346,154 -- 418,800(4) 279,200(5) -- -- 396,303 12,481 1,452,938 2017 362,518 -- 608,040(4) 405,360(5) -- -- 320,261 14,482 1,710,661 2017 316,720 -- 540,900(4) 360,600(5) -- -- 156,749 37,760 1,412,279 2016 310,034 -- 540,900(4 360,600(5) -- -- 191,079 113,866 1,516,479 2015 295,000 65,000 116,400(6) 58,200(7) 179,880 209,232 230,100 123,880 1,277,692 2017 295,000 -- -- -- -- -- -- 31,455 326,455 2017 197,363 -- 405,360(4) 270,240(5) -- -- 138,307 13,258 1,024,528 2016 365,855 -- 405,360(4) 270,240(5) -- -- 204,539 223,893 1,469,887 2015 355,000 90,000 155,200(6) 77,600(7) 239,840 278,976 362,165 148,817 1,707,598 (1) Reflects discretionary cash bonuses awarded in early fiscal 2015 by the Compensation Committee in light of the Company’s strong fiscal 2014 performance. (2) Reflects the annualized fair value at the date of grant. See footnotes (2), (3) and (4) of the Summary Compensation Table for additional information. (3) Reflects the fair value at the date of grant. See footnote (2) to the Summary Compensation Table for additional information. (4) These performance-based RSAs are eligible for vesting based on fiscal 2020 EBITDA relative to established goals for threshold, target and maximum performance. The grant date fair values reflected above were calculated assuming the achievement of the target level of performance. (5) These RSUs are subject to vesting based on continued service, with 30% vesting at the end of fiscal 2018, 30% vesting at the end of fiscal 2019 and 40% vesting at the end of fiscal 2020. The RSUs are not eligible to be converted into common stock until a change of control or the executive officer leaves Methode. (6) These performance-based RSAs vested based on fiscal 2015 internal enterprise value relative to established goals for threshold and target performance. (7) These RSUs vested 20% each year on the last day of Methode’s fiscal year from fiscal 2011 through fiscal 2015. The vested RSUs are not eligible to be converted into common stock until a change of control or the executive officer leaves Methode. (8) Reflects the annualized amounts paid under the performance-based tandem cash awards under the Fiscal 2011 LTI Program. (9) Amounts reflect annual performance-based cash bonuses. (10) See footnote (7) of the Summary Compensation Table for information regarding the amounts included in All Other Compensation. (11) See footnote (8) of the Summary Compensation Table for information regarding the hiring of Mr. Hrudicka and Mr. Koman’s retirement. (12) Mr. Khoury is a Lebanese resident and we paid Mr. Khoury’s cash compensation in Euros. For purposes of the Alternative Summary Compensation Table, this cash compensation was converted from Euros to U.S. Dollars. See footnote (9) of the Summary Compensation Table for information regarding the exchange rates. 32 April 29, 2017.Name Option Awards Stock Awards Option Expiration Date Number of Shares or Units of Stock That Have Not Vested (#)(2) Market Value of Share of Units of Stock That Have Not Vested ($)(3) Equity Incentive Plan Awards: Numbers of Unearned Shares, Units or Other Rights That Have Not Yet Vested (#)(4) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Yet Vested ($)(3) Donald W. Duda 26,667 13,333 (1) 37.01 7/7/2024 120,000 5,346,000 270,000 12,028,500 John R. Hrudicka -- -- -- -- 32,000 1,425,600 72,000 3,207,600 Joseph E. Khoury 8,000 4,000 (1) 37.01 7/7/2024 60,000 2,673,000 135,000 6,014,250 Theodore P. Kill -- -- -- -- 60,000 2,673,000 135,000 6,014,250 Timothy R. Glandon 8,000 4,000 (1) 37.01 7/7/2024 -- -- -- -- Douglas A. Koman -- -- -- -- -- -- 25,499 1,135,980 (1) These options were granted in July 7, 2014. One-third of these options vestvested on each of the first, second and third anniversaries of the grant date.(2) These RSUs are generally subject to a five-year vesting period based on continued service, with 30% vesting at the end of fiscal 2018,2023, 30% vesting at the end of fiscal 20192024 and 40% vesting at the end of fiscal 2020.2025. Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of Fiscal 2021 Compensation – 2021 LTI Program.”(3) Calculated based on the closing price of the Company’s common stock on April 28, 201730, 2021 of $44.55$44.93 per share.(4) These performance-based restricted stock awardsRSAs are eligible for vesting based on the achievementfiscal 2025 EBITDA, as adjusted, relative to established goals for threshold and target performance Additional details regarding these awards are set forth in “Compensation Discussion and Analysis – Components of certain financial targets for fiscal 2020 EBITDA.Fiscal 2021 Compensation – 2021 LTI Program.”The following table sets forth certain information regarding option exercises by thethe vestingnone of our named executive officers hold restricted stock or restricted units that vested during fiscal 2017.Name Option Awards Stock Awards Number of Shares Acquired on Exercise (#) Number of Shares Acquired on Vesting (#) (2) Donald W. Duda 40,000 841,938 -- -- John R. Hrudicka -- -- -- -- Joseph E. Khoury 16,000 429,609 -- -- Theodore P. Kill 12,000 226,452 -- -- Timothy R. Glandon 12,000 236,381 -- -- Douglas A. Koman 42,666 615,230 11,333 393,255 (1)Calculated based on market value of Methode’s common stock at the time of exercise, minus the exercise cost.(2)Reflects RSUs awarded pursuant to our Fiscal 2016 LTI Program. These shares vested in connection with Mr. Koman’s retirement in September 2016.(3)Calculated based on the closing price of Methode’s common stock on September 15, 2016 of $34.70 per share.
2021.33 2017.Name Donald W. Duda 0 0 90 0 31,071 John R. Hrudicka 0 0 0 0 0 Joseph E. Khoury 0 0 0 0 0 Theodore P. Kill 29,450 0 143,874 0 1,203,393 Timothy R. Glandon 0 0 60,473 (122,408) 423,416 Douglas A. Koman 0 0 255,479 (143,295) 1,431,539 (1) All executive contributions were reported as compensation in the “Summary Compensation Table” under the “Salary” and/or “Non-Equity Incentive Plan Compensation” columns, depending on the source of the executive contribution. (2) Reflects distributions in accordance with the terms of each executive’s deferral election. (1) All executive contributions were reported as compensation in the “Summary Compensation Table” under the “Salary” and/or “Non-Equity Incentive Plan Compensation” columns, depending on the source of the executive contribution. (2) Reflects distributions in accordance with the terms of each executive’s deferral election. and/or 100% of their tandem cash award, if applicable, with an aggregate minimum deferral of $3,000. Directors are allowed to defer up to 100% of their director compensation paid in cash or shares of Common Stock. The minimum period of deferral is three years. Participants are immediately 100% vested.employee-directeddirected deferrals, we may make contributions to the Deferred Compensation Plan to make up for limits applicable under our qualified plans and may make additional discretionary contributions as well. Participants vest in company contributions in accordance with the schedule set forth in the applicable agreement or plan governing such contributions. We made no contributions to the Deferred Compensation Plan in fiscal 2017.on a daily basis.34 a Change of Controlour stock plans and certain other benefit plans.The following table summarizes payments payable to our named executive officers upon a change in control or the executive’s death, disability or qualified retirement under our outstanding equity and cash bonus awards.Type of AwardTermination ScenarioChange in ControlDeath or DisabilityQualified Retirement(1)Annual Performance-Based Cash BonusIf the successor company does not assume the award, or if the successor company assumes the award and the executive is terminated without cause or resigns for good reason prior to payment, the executive will be entitled to the bonus payable assuming achievement of the target level of performance.Entitled to the bonus payable assuming achievement of the target level of performance.Eligible to earn a prorated bonus based on the number of months elapsed since the start of the fiscal year and the actual performance achieved as of the end of such fiscal year.Restricted Stock UnitsIf the successor company does not assume the RSUs, or if the successor company assumes the RSUs and the executive is terminated without cause or resigns for good reason within a period of time after the transaction (two years for Messrs. Duda and Hrudicka and one year for Messrs. Khoury and Kill), all unvested RSUs will become immediately and fully vested.All unvested RSUs will become immediately and fully vested.A prorated number of RSUs will vest based on the months elapsed since May 3, 2015.Restricted Stock AwardsIf the successor company does not assume the RSAs, or if the successor company assumes the RSAs and the executive is terminated without cause or resigns for good reason within a period of time after the transaction (two years for Messrs. Duda and Hrudicka and one year for Messrs. Khoury and Kill), the executive will earn a prorated number of the RSAs eligible for vesting assuming the achievement of the target level of performance based on the number of months elapsed since May 3, 2015.In either case, the executive is also entitled to a payment based on the dividends declared during the restricted period and the number of shares vested.The number of RSAs eligible for vesting assuming the achievement of the target level of performance will become immediately and fully vested.The executive is also entitled to a payment based on the dividends declared during the restricted period and the number of shares vested.Eligible to earn a prorated number of shares based on the number of months elapsed since May 3, 2015 and Methode’s fiscal 2020 adjusted EBITDA.The executive is also entitled to a payment based on the dividends declared during the restricted period and the number of shares vested.Stock OptionsImmediate vesting of outstanding option awards.Immediate vesting of all outstanding option awards.Immediate vesting of all outstanding option awards.(1)An executive’s qualified retirement occurs at or after age 65, or after age 55 with our consent.35 Hrudicka, KillTsoumas and GlandonKhoury and Ms. Barry are parties to change of control agreements with the Company. Mr. Khoury is not a party to a change of control agreement. Pursuant to these change of control agreements, if within two years of a change of control or during a period pending a change of control, we terminate the executive’s employment without good cause or the executive voluntarily terminates his or her employment for good reason, the executive is entitled to the following:three times (two times in the casea multiple of Messrs. Hrudicka, Kill and Glandon) the executive’s annual salary;base salary (three times for Mr. Duda and two times for the other named executive officers);threea multiple (three times (twofor Mr. Duda and two times infor the case of Messrs. Hrudicka, Kill and Glandon)other named executive officers) of the lesser of: (a) the executive’s target bonus amount for the fiscal year in which executive’s employmentthe termination occurs, or (b) the bonus the executive earned in the prior fiscal year; and(twofor Mr. Duda and two years infor the case of Messrs. Hrudicka, Kill and Glandon)other named executive officers, or until the executive becomes covered under other welfare benefit plans providing substantially similar benefits. (1) An executive’s qualified retirement occurs at or after age 65, or after age 55 with our consent. Mr. Duda is 65 years old. All of our other named executive officers are between 55 and 65 years old. currently serving named executive officers upon termination or a change of control of Methode. The information shown for Mr. Koman reflects the compensation received in connection with his qualified retirement in September 2016. The amounts shown assume that such termination was effective as of April 28, 2017 (the30, 2021, the last trading day of our 20172021 fiscal year),year, and reflect the price of our common stock on such date ($44.55) and reflects awards outstanding and unvested on such date.44.93). The table below does not reflect amounts payable to our named executive officers pursuant to plans or arrangements that are available generally to salaried employees, such as payments under the 401(k) Plan, the life insurance plan, the disability insurance plan and the vacation pay policy, payment of accrued base salary and accrued bonuses and, in the case of Mr. Khoury, payments under the Lebanese Labor Laws.employees. In addition, the table does not reflect the distribution of each officer’s account balancebalances in our Deferred Compensation Plan or the delivery of common stock underlying outstanding vested restricted stock units. For purposes of this table, we have assumed that our Compensation Committee has elected to accelerate all awards in each instance in which acceleration is subject to the discretion of our Compensation Committee.36 Name Payment of Annual Performance-Based Bonus
($)Vesting of RSUs ($) Vesting of RSAs ($)(1) Donald W. Duda Upon Change of Control (3) -- 716,108 100,533 5,346,000 8,132,400 -- Resignation for Good Reason/Termination Without Cause Following Change of Control (4) 4,296,648 -- -- -- -- 71,021 Death or Disability -- 716,108 100,533 5,346,000 8,132,400 -- Qualified Retirement -- 716,108 100,533 2,138,400 3,363,120 -- John R. Hrudicka Upon Change of Control (3) -- 297,000 -- 1,425,600 2,151,360 -- Resignation for Good Reason/Termination Without Cause Following Change of Control (4) 1,929,462 -- -- -- -- 71,021 Death or Disability -- 297,000 -- 1,425,600 2,151,360 -- Qualified Retirement -- 297,000 -- 570,240 547,560 -- Joseph E. Khoury Upon Change of Control (3) -- 240,012 30,160 2,673,000 4,066,200 -- Resignation for Good Reason/ Termination Without Cause Following Change of Control -- -- -- -- -- -- Death or Disability -- 240,012 30,160 2,673,000 4,066,200 -- Qualified Retirement -- 240,012 30,160 1,069,200 1,681,560 -- Theodore P. Kill Upon Change of Control (3) -- 210,568 -- 2,673,000 4,066,200 -- Resignation for Good Reason/ Termination Without Cause Following Change of Control (4) 1,054,576 -- -- -- -- 15,480 Death or Disability -- 210,568 -- 2,673,000 4,066,200 -- Qualified Retirement -- 210,568 -- 1,069,200 1,681,560 -- Timothy R. Glandon Upon Change of Control (3) -- -- 30,160 -- -- -- Resignation for Good Reason/ Termination Without Cause Following Change of Control (4) 590,000 -- -- -- -- 47,347 Death, Disability -- -- 30,160 -- -- -- Qualified Retirement -- -- 30,160 -- -- -- Douglas A. Koman Qualified Retirement -- 138,307 26,894 393,255 794,047 -- (1) Amounts include an amount equal to the cash dividends declared during the period from the date of grant thru May 1, 2021, multiplied by the number of shares or units vested. (2) For purposes of this table, we have assumed that the target performance level will be achieved with respect to the RSAs. Amounts include an amount equalRSAs and the Performance Units and that our Compensation Committee has elected to accelerate all awards subject to the cash dividends declared duringdiscretion of the period from the date of grant thru April 28, 2017, multiplied by the number of RSAs vestedCompensation Committee.(2)(3)Reflects the estimated lump-sum present value of all future premiums which will be paid on behalf of the executive under our health and welfare benefit plans. (3)(4)Includes amounts payable whereAssumes the successor company assumed an award and then terminated an executive without causedoes not assume the annual bonus awards, RSUs or the executive resigned with good reason.RSAs.(4)(5)These amounts are in addition to amounts payable under the preceding row “Upon Change of Control.” For the transition awards, assumes the executive is terminated without good cause or voluntarily terminates employment for good reason within two years. 37 (6)Assumes the target level of performance is achieved. Beneficial Ownership Reporting Compliance2017,2021, all such reports were timely filed.filed, except that, due to administrative oversight, transactions in a broker dividend reinvestment plan were reported in two late Form 4s for Timothy Glandon, our Vice President. As reported in the Form 4s, the transactions consisted of forty transactions involving the acquisition of 1,134 shares of our common stock in the aggregate. In making these disclosures, we have relied solely on written representations of our directors and executive officers and copies of the reports filed with the SEC.shareholdersstockholders who receive this proxy statement. Methode will provide copies of the Annual Reportthese materials to brokers, dealers, banks, voting trustees and their nominees for the benefit of theirthe beneficial owners of record. Additional copies of this proxy statement and the Annual Report and Methode’s2021 Annual Report on Form 10-K for the fiscal year ended April 29, 2017 are available, without charge, upon written request to Methode Electronics, Inc., 74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706,60631, Attention: Chief Financial Officer. You may also review Methode’s SEC filings by visiting the Investors page of our website atwww.methode.com.Shareholder www.methode.com.shareholderstockholder proposal for inclusion in our proxy materials for our 20182022 Annual Meeting, our Corporate Secretary must receive your proposal no later than April 3, 2018.March 29, 2022. Your proposal must be in writing and must comply with the proxy rules of the SEC.shareholderstockholder proposal or director nomination to be presented from the floor of our 20182022 Annual Meeting must be received by our Corporate Secretary not later than the 60th day nor earlier than the 90th day prior to September 14, 201815, 2022 (the first anniversary of the preceding year’s annual meeting)Annual Meeting). If the date of our 20182022 Annual Meeting is more than 30 days before or more than 60 days after September 14, 2018, shareholder15, 2022, stockholder proposals must be delivered no earlier than the 90th day prior to such annual meeting date and not later than the later of the 60th day prior to such annual meeting date or the 10th day following our public announcement of the meeting date for such annual meeting.Annual Meeting. Any shareholderstockholder proposal must be, under law, an appropriate subject for shareholderstockholder action in order to be brought before the meeting. In addition, in order to present a shareholderstockholder proposal or nominate a director at our 20182022 Annual Meeting, the shareholderstockholder must satisfy certain other requirements set forth in our Amended and Restated By-Laws. ShareholderStockholder proposals and director nominations should be directed to the Corporate Secretary of Methode Electronics, Inc. at 74018750 West WilsonBryn Mawr Avenue, Suite 1000, Chicago, Illinois 60706.annual meeting.Annual Meeting. Should any other business properly come before the annual meeting,Annual Meeting, the persons named in the proxy will vote on such matters in accordance with their best judgment. the Board of Directors,Walter J. AspatoreChairmanChicago, IllinoisAugust 1, 201738 
METHODE ELECTRONICS, INC.7401 WEST WILSON AVENUECHICAGO, IL 60706-4548VOTE BY INTERNET - www.proxyvote.comUse the Internet to transmit your voting instructions for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the annual meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALSMethode Electronics, Inc. encourages you to take advantage of convenient ways to vote these shares. If voting by proxy, you may grant a proxy by mail, or choose one of the two methods described below. Your telephone or Internet proxy authorizes the named proxies to vote these shares in the same manner as if you marked, signed, and returned your proxy card. To grant your proxy by telephone or Internet, read the annual meeting proxy statement and then follow these easy steps:VOTE BY PHONE - 1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the annual meeting date. Have your proxy card in hand when you call and then follow the simple instructions the vote voice provides you.VOTE BY MAILMark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:KEEP THIS PORTION FOR YOUR RECORDSDETACH AND RETURN THIS PORTION ONLYTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.The Board of Directors recommends you vote FOR the following:1.Election of DirectorsNomineesFor Against Abstain1a.Walter J. Aspatore☐☐☐The Board of Directors recommends you vote FOR proposals 2 and 3.ForAgainstAbstain1b.Darren M. Dawson☐☐☐2The ratification of the Audit Committee's selection of Ernst & Young LLP to serve as our independent registered public accounting firm for the fiscal year ending April 28, 2018.☐☐☐1c.Donald W. Duda☐☐☐1d.Martha Goldberg Aronson☐☐☐1e.Isabelle C. Goossen☐☐☐3The advisory approval of Methode's named executive officer compensation.☐☐☐1f.Christopher J. Hornung☐ ☐ ☐ 1g. Paul G. Shelton☐☐☐The Board of Directors recommends you vote 1 YEAR on the following proposal:1 year2 years3 yearsAbstain1h.Lawrence B. Skatoff☐☐☐4To recommend, by non-binding vote, the frequency of advisory votes on named executive officer compensation. ☐☐ ☐☐ NOTE:Such other business as may properly come before the meeting or any adjournment thereof.Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.Signature [PLEASE SIGN WITHIN BOX]DateSignature (Joint Owners)Date0000341962_1 R1.0.1.15Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement and Annual Report are available atwww.proxyvote.comMETHODE ELECTRONICS, INC.This proxy is solicited by the Board of Directors,Annual Meeting of the Shareholders The undersigned hereby appoints Donald W. Duda and John R. Hrudicka, and each of them, with full power of substitution, as proxies to vote all shares of Methode Electronics, Inc. common stock which the undersigned is entitled to vote at the Annual Meeting of Methode Electronics, Inc. to be held on Thursday, September 14, 2017 at 11:00 a.m., Central Daylight Time, at Methode's corporate offices at 7401 West Wilson Avenue, Chicago, Illinois 60706, and at any adjournment or postponement thereof.This proxy when properly signed will be voted in the manner directed herein by the undersigned shareholder. IF NO DIRECTION IS PROVIDED, THIS PROXY WILL BE VOTED AS RECOMMENDED BY THE BOARD OF DIRECTORS. If other business is presented at the Annual Meeting, this proxy shall be voted in accordance with the best judgment of the persons named as proxies above.Continued and to be signed on reverse side0000341962_2 R1.0.1.15
