12 23 2021 Moog Proxy - FY2021 - FINAL - Flipbook - Page 23
Long Term Incentive (LTI)
The Company believes that stock ownership on the part of executive officers serves to align the leadership of the Company with
the interest of shareholders. The Board has appointed the Executive Compensation Committee to administer all components of
executive compensation, including equity-based compensation plans. These responsibilities include the authority to construe and
interpret the terms of the plans and awards granted under them, as well as the authority to determine the persons eligible to
receive awards, when each award will be granted and the terms of each award, including the award amounts granted. No
awards may be re-priced in accordance with the terms of the Company’s outstanding plans.
During fiscal 2021, the CEO was awarded 25,130 SARs, 7,949 PSUs and $583,334 in TVAs. The CFO was awarded 7,611
SARs, 2,408 PSUs and $176,666 in TVAs. All other NEOs were awarded 4,452 SARs, 1,408 PSUs and $103,334 in TVAs.
These awards were granted under the 2014 LTI Plan and, in respect to the SARs and PSUs, were issued in underlying Class B
shares. The SARs and TVAs each vest ratably over a three-year period. The PSUs will vest at the end of a three-year
performance period and the number of PSUs earned will be determined based upon the level of performance achieved against
two performance criteria. PSUs have the potential to be earned between zero and two times the number of target units awarded.
The Executive Compensation Committee has not used a formulaic approach, but in years when performance is considered
adequate, the Executive Compensation Committee has invited the CEO to make recommendations for LTI awards for all
executive officers other than himself. These recommendations were either approved or adjusted by the Executive Compensation
Committee. With regard to the CEO, SAR, PSU and TVA awards were determined by the Executive Compensation Committee. A
total of 90,304 SARs, 28,442 PSUs and $2,085,836 TVAs were awarded to all eligible executives in fiscal 2021.
A SAR award contains such terms and conditions as determined by the Executive Compensation Committee, subject to the
terms of the 2014 LTI Plan, including the date on which the SARs become exercisable and the expiration date of the SARs. The
exercise price of a SAR on Class B shares will be equal to the fair market value of one Class B share on the grant date as
defined in the 2014 LTI Plan.
SARs vest and become exercisable pursuant to the terms and conditions outlined in each participant’s award agreement, as
determined by the Executive Compensation Committee. Except as described in Potential Payments upon Termination or Change
in Control beginning on page 34, SARs do not become exercisable earlier than the first anniversary of the date of grant, and
vested SAR awards will be exercisable by participants only until the tenth anniversary of the date of grant. The total number of
shares of Moog stock subject to SARs that may be awarded to any one employee during any fiscal year of the Company may not
exceed 100,000 shares.
A PSU award contains such terms and conditions as determined by the Executive Compensation Committee, subject to the
terms of the 2014 LTI Plan, including the dates on which the PSUs vest and settle, the performance criteria which the awards are
based on and the way in which awards will be linked to performance targets. The fair market value realized upon settlement of
earned PSUs is defined in the same manner as described above for SARs.
PSUs vest and settle pursuant to the terms and conditions outlined in each participant’s award agreement, as determined by the
Executive Compensation Committee. Except as described in Potential Payments upon Termination or Change in Control
beginning on page 34, PSUs do not vest earlier than the end of the three-year performance period, at which time they vest in
accordance with the level of performance attained upon certification by the Executive Compensation Committee. The total
number of shares of Moog stock subject to PSUs that may be awarded to any one employee during any fiscal year of the
Company may not exceed 100,000 shares. For the fiscal 2021 grant, the performance measures used for PSUs were total sales
growth and operating margin target. The Company does not publicly disclose the specific performance target levels as they
constitute highly confidential information that would result in competitive harm. The targets approved by the Executive
Compensation Committee and the Board are rigorous and challenging and were set sufficiently high enough to be difficult, but
not unattainable, to achieve.
A TVA award contains such terms and conditions as determined by the Executive Compensation Committee, subject to the terms
of the 2014 LTI Plan, including the dates on which the TVAs vest and settle and whether the TVAs will be settled in the form of
cash or a number of Class B shares, determined using the the current stock price upon settlement. For TVAs settled in Class B
shares, the fair market value realized upon settlement of vested TVAs is defined in the same manner as described above for
SARs and PSUs.
TVAs vest and settle pursuant to the terms and conditions outlined in each participant’s award agreement, as determined by the
Executive Compensation Committee. Except as described in Potential Payments upon Termination or Change in Control
beginning on page 34, TVAs do not vest earlier than the first anniversary of the date of grant. Each vested fixed dollar tranche of
a TVA will settle in Class B shares using the fair market value, as defined in the 2014 LTI Plan, of the Class B shares on the date
of vesting of such tranche. While it is intended that TVAs will be settled in Class B shares, the Company reserves the right, at its
discretion, to settle vested amounts in cash rather than issue shares.
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