The Board affirmatively determines the independence of each director and nominee for election as a director in accordance with criteria set forth in the Company’s Corporate Governance Guidelines (the “Guidelines”), which include all elements of independence set forth in the New York Stock Exchange (“NYSE”) listing standards and related U.S. Securities and Exchange Commission (“SEC”) Rules and Regulations. At a regularly scheduled portion of each Board meeting or as part of the Governance Committee meetings, the independent directors meet in executive session without management or any non-independent directors present. Independent directors have no material relationship with the Company, except as directors and shareholders of the Company.

As reported in last year's proxy statement, Steve Cooper served as a director in 2023, and the Board determined that he was not independent because he also served as CEO of the Company during that time.

Based on the aforementioned standards, at its meeting held on March 13, 2024, the Board made the independence determinations for each of our directors:

Enterprise risk management is an integral part of our business processes and the Company has an enterprise risk management (“ERM”) program to integrate risk responsibilities within the current management structure. Specific risks are assigned to the Board’s committees and business area experts. The most significant risks are regularly discussed with the Board as part of its active oversight of risks that could affect the Company. Risks are delegated among the committees based on the expertise of each committee. Each committee and the Board discuss specific risks with management throughout the year, as appropriate. The Board believes the administration of this risk oversight function does not negatively affect the Board’s leadership structure.

The Board exercises an oversight role with respect to the most significant risks facing our Company and maintains responsibility for certain risks, while designating the Audit Committee with the primary responsibility for overseeing the Company’s ERM program and process. Management provides the Board with periodic reports on the Company’s risk and ERM program findings. The Audit Committee has responsibility to periodically review the Company’s guidelines, policies, and procedures to assess and manage risk exposure.

The individual committees also consider risk within their areas of responsibility as highlighted below. The committee chairs provide reports of their activities to the Board at each regular Board meeting including apprising the Board of any significant risks within their areas of responsibility and management’s response to those risks.

Each director is expected to devote sufficient time, energy, and attention to ensure diligent performance of his or her duties and to attend all Board, committee, and shareholders’ meetings. The Board met eleven (11) times during 2023. All directors attended all the meetings of the Board and of the committees on which they served during the fiscal year ended December 31, 2023. Our Guidelines provide that each of our directors is expected to attend our annual meeting of shareholders and all directors participated in the 2023 Annual Meeting of Shareholders on May 11, 2023.

The Board has four standing committees to facilitate and assist the Board in the execution of its responsibilities. These committees are the Audit Committee, the Compensation Committee, the Governance Committee, and the Innovation and Technology Committee (“I&T Committee”). With the exception of the I&T Committee, of which Ms. Owen is a member, all the committees are comprised solely of non-employee, independent directors. Charters for each committee are available on the Company’s website at https://investor.trueblue.com/corporate-governance/governance-documents. The charter of each committee is also available in print to any shareholder upon request. The table below shows membership for each of the standing Board committees as of December 31, 2023, the number of times each committee met in 2023, and outlines each committee’s key responsibilities and functions.

The Audit Committee is comprised solely of non-employee directors, all of whom the Board determined are independent pursuant to the NYSE rules and the independence standards set forth in Rule 10A-3 of the Exchange Act. The Governance Committee and the Board have determined that all the members of the Audit Committee are “financially literate” pursuant to the NYSE rules. The Board has affirmatively determined that Ms. Harris Jones and Messrs. Kreidler, Reitz, and Sakaguchi are “audit committee financial experts,” as such term is defined in Item 407 of Regulation S-K. The Board has adopted a charter for the Audit Committee, which is available on the Company’s website at https://investor.trueblue.com/corporate-governance/governance-documents. The charter is also available in print to any shareholder upon request.

The Compensation Committee is comprised solely of non-employee directors, all of whom the Board determined are independent pursuant to the NYSE rules. The Compensation Committee is comprised entirely of independent directors. During 2023, none of the Company’s executive officers served as a member of a compensation committee or board of directors of any other entity that had an executive officer serving as a member of the Company’s Board. The Board has adopted a charter for the Compensation Committee, which is available on the Company’s website at https://investor.trueblue.com/corporate-governance/governance-documents. The charter is also available in print to any shareholder upon request. Additional information regarding the Compensation Committee and its procedures and processes for the consideration and determination of executive compensation are included under the Compensation Discussion and Analysis section of this proxy statement.

The Governance Committee is comprised solely of non-employee directors, all of whom the Board determined are independent pursuant to the NYSE rules. The Board has adopted a charter for the Governance Committee, which is available on the Company’s website at https://investor.trueblue.com/corporate-governance/governance-documents. The charter is also available in print to any shareholder upon request.

The Corporate Governance and Nominating Committee is responsible for the CEO succession planning process. During 2023, the Governance Committee oversaw the appointment of a new Chief Executive Officer (“CEO”), Taryn Owen. Ms. Owen’s appointment to the CEO role came after extensive planning and consideration. With Mr. Cooper’s return from retirement to lead the Company in 2022, the Governance Committee began planning for the appointment of a new CEO within one to three years. Ms. Owen had previously been selected to lead the Company’s most profitable divisions, PeopleReady (2019-2023) and PeopleScout (2014-2019 and again in 2021-2023). During late 2022 and early 2023, the Governance Committee engaged an outside executive training and development firm to further evaluate Ms. Owen’s preparation to eventually assume the CEO role. In 2022, Ms. Owen was promoted to Chief Operating Officer (“COO”) and President of the Company, which, in addition to leading all our operating divisions, included responsibility for overseeing the technology, human capital, and marketing/communications functions of the Company. As COO, Ms. Owen continued to serve as President to PeopleReady and

PeopleScout. After continuing to monitor and evaluate Ms. Owen’s performance as COO, the Governance Committee recommended to the Board that Ms. Owen be appointed CEO. On August 5, 2023, the Board appointed Ms. Owen as CEO, to be effective on September 12, 2023, after a brief transition period. With her promotion to CEO, Ms. Owen was appointed as a director on the Board, effective September 12, 2023, at which time Mr. Cooper simultaneously stepped down from the Board. After the transition was complete, and Ms. Owen had assumed the CEO position, Mr. Cooper remained with the Company to provide advice, counsel, and ensure a smooth transition for Ms. Owen, until his retirement from the Company on December 31, 2023.

The I&T Committee’s primary functions are to oversee the Company’s information risks, cybersecurity, technology strategy, artificial intelligence, and emerging innovation and business trends and their alignment with the Company’s business strategies and objectives. The Board has adopted a charter for the I&T Committee, which is available on the Company’s website at https://investor.trueblue.com/corporate-governance/governance-documents. The charter is also available in print to any shareholder upon request.

The Company sees environmental, social, and governance (“ESG”) matters as an essential component of sustainable Company performance and integral to the successful implementation of our long-term business strategy. ESG considerations inform how we manage the Company, including our risk management framework and our governance mechanisms for Board oversight and how we deliver sustainable growth that positively impacts our employees, clients, shareholders, and the communities in which we operate. In 2022, we joined the United Nations Global Compact on sustainability.

As the Company seeks to meet evolving stakeholder needs, the Board views ESG issues as increasingly essential to the Board’s oversight of our business strategy. The Governance Committee is responsible for overseeing our ESG efforts and receives regular updates from management on our sustainability strategy and activities. The Company’s ESG efforts are led by the chief legal officer, who chairs, leads, and manages our response to ESG issues for the Company, and engages stakeholders on our ESG initiatives. Other senior leaders provide input through corporate organizations such as the Diversity, Equity, & Inclusion Council (the “Council”). The Company implements day-to-day ESG programs with support from senior managers and relevant corporate functions.

Our approach to ESG strategy and corporate sustainability begins with understanding and acting on the ESG issues that most impact our business performance and strategy. Since 2018, we have conducted assessments of significant ESG risks, based on input from across the Company and alignment with leading external reporting frameworks. In assessing key material topics for our business and industry, we referenced the Sustainability Accounting Standards’ Board and added components most important to stakeholders across the Company.

After considering the various ESG related risks and conducting a stakeholder materiality assessment in 2022, the Company found the following risks to be material or significant enough to warrant specific ESG reporting efforts:

These ESG materiality issues have been used by the Company to guide our ESG programs and provide additional reporting through our Corporate Citizenship Report.

As a member of the United Nations Global Compact, we have further committed to acting on sustainable development goals related to:

The Board has long prioritized diversity, equity, and inclusion (“DE&I”) as a key aspect of corporate sustainability, setting an example for the Company's leadership. DE&I is seen as not just important for “sustainability” but as fundamental to our performance as a people-based company and critical to our strategic and competitive success. The Board has been recognized by the National Association of Corporate Directors (“NACD”) and other national and regional organizations for its efforts and success in becoming a diverse and inclusive board. The Board continues to foster and promote a diverse, talented, and well-trained workforce and a performance-driven workplace culture.

Management has also emphasized DE&I throughout the Company with our Chief Diversity Officer leading our DE&I programs. Additionally, the Council designs and launches initiatives that advance acceptance and inclusion. The Council reports regularly to executive leadership, who brief our Board periodically throughout the year. The Council also sponsors training to build diversity and inclusion awareness, and supports Employee Resource Groups (“ERGs”), which are employee-led groups that create opportunities for employees to collaborate based on shared characteristics or life experiences to support each other for enhanced career and personal development. ERGs seek to maximize employee engagement and contribute to our overall business objectives by offering diverse perspectives, networking opportunities, and increased cultural awareness. We currently have nine ERGs for employees sharing

similar ethnicity, nationality, gender, lifestyle choice, or life experience and their respective allies. Through these initiatives, we learn how our differences build stronger teams and how our histories reveal similarities.

Board and corporate governance have been a focus of the Company for over a decade, exemplified by the Company’s early adoption of a practice separating the CEO and Board Chair roles. The Governance Committee also receives frequent updates on evolving corporate governance best practices and implements those practices most impactful or useful to the Company.

A nominee for director in an uncontested election who does not receive the majority vote required by our Amended and Restated Bylaws (the “Bylaws”) but who was a director at the time of the election shall not be elected, but shall continue to serve as a holdover director until the earliest of: (i) 90 days after the date on which an inspector determines the voting results as to that director pursuant to Section 23B.07 of the Washington Business Corporation Act; (ii) the date on which the Board appoints an individual to fill the office held by such director, which appointment shall constitute the filling of a vacancy by the Board; or (iii) the date of the director’s resignation. Any vacancy resulting from the nonelection of a director under these circumstances may be filled by the Board as provided in Article II, Section 2.11 of the Company’s Bylaws. The Governance Committee will promptly consider whether to fill the position of a nominee failing to receive a majority vote and make a recommendation to the Board to fill the position. The Board will act on the Governance Committee’s recommendation and, within 90 days after the certification of the shareholder vote, will publicly disclose its decision. Except as provided in the next sentence, a director who fails to receive a majority vote for election will not participate in the Governance Committee’s recommendation or the Board’s decision about filling his or her office. If no director receives a majority vote in an uncontested election, then the incumbent directors: (i) will nominate a slate of nominee directors and hold a special meeting for the purpose of electing those nominees as soon as practicable; and (ii) may in the interim fill one or more director positions with the same director(s) who will continue in office until their successors are elected.

Professional ethics are monitored at the Board level by the Audit Committee. The Chief Ethics and Compliance Officer oversees risks related to professional integrity and ethics, ensuring regular training for Company employees on our Code of Conduct and Business Ethics (“Code of Conduct”), anti-fraud, bribery and corruption efforts, third-party risk management program, and provides regular reports to the Audit Committee of these efforts and any breaches of ethical conduct by Company employees. Our Code of Conduct covers topics including avoiding conflicts of interest, maintaining confidentiality, anti-harassment and discrimination, among others.

We believe a strong corporate culture and employee engagement is key to attracting and retaining talented employees. To assess and improve our culture, we routinely utilize an independent third party to measure how favorably our employees view our organizational culture and engagement. These surveys include corporate culture assessments, as well as real-time feedback on employee

engagement and employee-management relations. We also engage an independent third party to measure the ethical culture of the Company by assessing employees’ and leaders’ perception of the Company’s ethical culture. The results of these surveys are reported and distributed throughout management and the Board, and are used to create actionable plans to improve employee engagement and retention. Our August 2023 engagement survey achieved an engagement score of 77, which exceeds the target benchmark of 74 set by the independent third-party survey provider.

Our human capital strategy is centered on our values and our employees. Ensuring a diverse and inclusive performance-driven culture is one of the key components of this corporate strategy and a corporate priority led by the Board. We invest in emerging talent through our DE&I program, recruitment strategies, talent management, and development programs for critical roles. Our human capital management (“HCM”) initiatives are included in the chartered responsibilities of the Compensation Committee. Relevant HCM metrics are reported on a regular basis to the Compensation Committee. Our online training platforms provide our employees with access to a multitude of training courses, videos, reference material, and other tools.

We also emphasize the health, safety, and wellness of our employees. We provide our employees and their families with flexible health and wellness programs, including competitive benefits. Our benefits include health, dental, and vision insurance, health savings and flexible spending accounts, paid time off, family leave, mental health resources, and family care resources.

The Board acknowledges the importance of assessing, identifying, and managing material risks associated with cybersecurity threats. Since 2011, our I&T Committee has been responsible for the oversight of risks from cybersecurity threats. All of our Board members are members of the I&T Committee. At least quarterly, management provides the I&T Committee with updates regarding our cybersecurity risks, threats, and efforts focused on mitigating those risks. These updates are provided by our Chief Digital Officer and our Chief Information Security Officer, and include recent developments in cybersecurity, the Company’s actual experience with cybersecurity incidents, and the systems and processes in place to defend against cyberattacks. Should a material or potentially material cybersecurity incident occur, the Board will immediately be notified of such event by the Company’s CEO. As part of our ongoing cybersecurity risk management and strategy processes, we leverage technology and established processes, procedures, risk assessments, third party due diligence and other controls to identify, assess, monitor, and manage material cybersecurity risks. Additional information on these processes can be found in Item 1C of the Company’s 10-K filed on February 21, 2024.

We are committed to promoting environmental sustainability both internally, by minimizing our corporate environmental footprint, and externally by developing digital tools that modernize how people are connected with work and reducing our employees’ need for daily transportation to our branches or to face-to-face interviews.

We strive to reduce our corporate environmental footprint by seeking opportunities for increased efficiency and resource conservation. We

completed our first greenhouse gas assessment in 2022 and have continued to complete these on an annual basis. The results of these assessments are published in our Corporate Citizenship Report. In 2023, we established a GreenTeam composed of members across the Company to help establish goals with the information from the greenhouse gas assessments. We will continue to refer to the Task Force on Climate-Related Financial Disclosures (TCFD) framework to further develop measurable environmental goals for the Company. Since 2022, we have been disclosing our Scopes 1, 2, and 3 emissions through our Corporate Citizenship Report.

A more detailed disclosure of more of our ESG efforts as a Company can be found in our Corporate Citizenship Report on our website at trueblue.com/corporate-citizenship/. This report is updated from time to time and contains a description of our ESG efforts more broadly, as well as disclosure of some of the metrics we use to measure and improve our performance in these important areas for the Company. The Corporate Citizenship Report on our website does not form a part of this proxy statement.

The Corporate Governance Guidelines (the “Guidelines”) are available at https://investor.trueblue.com/corporate-governance/

governance-documents. Shareholders may request a free printed copy by contacting TrueBlue, Inc., Investor Relations, 1015 A Street, Tacoma, Washington 98402. The Guidelines were adopted by the Board to best ensure that the Board is independent from management, that the Board adequately performs its function as the overseer of management, and that the interests of the Board and management align with the interests of the shareholders.

On an annual basis, each director and executive officer is obligated to complete a questionnaire which, among other things, requires disclosure of any transactions with the Company in which the director or executive officer, or any member of his or her immediate family, has a direct or indirect material interest.

We value our shareholders’ feedback and are committed to engaging in constructive and meaningful dialogue with shareholders regarding our strategic focus, operating results, capital allocation priorities, governance practices, executive compensation program, and other areas of shareholder focus throughout the year. As part of our ongoing outreach, members of senior management and investor relations routinely engage with investors in many different ways, including:

These activities allow our senior management and investor relations teams to share and discuss our business strategy and achievements with investors, solicit investor feedback on our performance, and seek insight into our investors’ priorities.

Any shareholder or interested party who wishes to communicate with our Board or any specific director, including non-employee directors, may write to Board of Directors, TrueBlue, Inc. c/o Corporate Secretary, 1015 A Street, Tacoma, Washington 98402. The mailing envelope must contain a clear notation indicating that the enclosed letter is a “Board Communication” or “Director Communication.” All such letters must indicate whether or not the author is a shareholder and clearly state whether the intended recipients are all members of the Board or specific individual directors. The Corporate Secretary will make copies of all such letters and circulate them to the appropriate director(s). If the Company develops any other procedures, they will be posted on the Company’s website at www.trueblue.com. Procedures addressing the reporting of other concerns by shareholders, employees, or other third parties are set forth in our Code of Conduct.

The Board annually assesses the performance and effectiveness of the Board, the Audit, Compensation, and I&T Committees, these committee chairs, the Board Chair, and each director through an annual self-evaluation, discusses the results of each annual self-evaluation and, as appropriate, implements enhancements and other modifications identified during the self-evaluation process.

The Board and the committees noted in the prior paragraph conduct annual self-evaluations by written questionnaire to provide feedback on performance and effectiveness of the Board and committees.

Directors provide ongoing, real-time feedback to management, committees, and the chairs of each committee, including the Board Chair, outside the formal annual self-assessment process, and specifically reserve time after each Board meeting to consider the effectiveness of that meeting and discuss potential improvements to various Board practices.

Independent legal counsel aggregates and summarizes the annual director questionnaire responses to promote candor and ensure feedback is not attributed to individual directors and provides guidance on material issues. The Governance Committee reviews the evaluation results for the Board and each committee and presents the results and findings to the full Board and each committee for further consideration and discussion.

The Governance Committee annually reviews the self-evaluation process to ensure that actionable and constructive feedback is solicited on the operations and performance of individual committees and the Board as a whole.

As an outcome of these discussions, the Board and its committees identify key substantive and procedural areas for increased Board effectiveness. Changes to the Board’s policies and practices are also considered and implemented based on self-evaluation results and ongoing feedback. Some of the actions taken recently in response to suggestions for improvement include:

Our Code of Conduct and Business Ethics (“Code of Conduct”) is applicable to all directors, officers, and employees of the Company. Our Code of Conduct is available at www.trueblue.com/code-of-conduct. Shareholders may also request a free printed copy from TrueBlue, Inc., Investor Relations, 1015 A Street, Tacoma, Washington 98402.

The Company intends to disclose any amendments to the Code of Conduct (other than technical, administrative, or non-substantive amendments) and any waivers of a provision of the Code of Conduct for directors or executive officers on the Company’s website at www.trueblue.com. Information on the Company’s website, however, does not form a part of this proxy statement.

The Board has adopted a Related Party Transaction Policy, which sets forth the policies and procedures for the review and approval or ratification of “Related Person Transaction(s).” A Related Person Transaction is defined to include transactions, arrangements, or relationships in which the Company is a participant, the amount involved exceeds $120,000, and a Related Person has or will have a direct or indirect material interest. “Related Person” is defined to include directors, executive officers, director nominees, beneficial owners of more than 5% of the TrueBlue shares (“Common Stock”), and members of their immediate families sharing the same household. A Related Person Transaction must be reported to the Company’s Chief Legal Officer and reviewed and approved by the Governance Committee. Under certain circumstances, a transaction may be approved by the Chair of the Governance Committee subject to ratification by the full Governance Committee at its next meeting. In determining whether to approve or ratify a Related Person Transaction, the Governance Committee, as appropriate, shall review and consider:

After reviewing all facts and circumstances, the Governance Committee may approve or ratify the Related Person Transaction only if it determines that the transaction is in, or is not inconsistent with, the best interests of the Company.

There were no Related Person Transactions in 2023.

The Corporate Governance Guidelines include the criteria our Board believes are important in the selection of director nominees. While the Board has not established any minimum qualifications for nominees, the Board does consider the composition of the Board as a whole, the requisite characteristics (including independence, diversity, and experience in industry, finance, administration, and operations) of each candidate, and the skills and expertise of its current members while taking into account the overall operating efficiency of the Board and its committees. With respect to diversity, we broadly construe diversity to mean not only diversity of race, gender, and ethnicity, but also diversity of opinions, perspectives, and professional and personal experiences. Nominees are not discriminated against on the basis of race, gender, religion, national origin, sexual orientation, disability, or any other basis proscribed by law. Service on other boards of directors and other commitments by directors will be considered by the Governance Committee and the Board when reviewing director candidates and in connection with the Board’s annual self-assessment process for current members of the Board.

The Governance Committee may employ a variety of methods for identifying and evaluating nominees for director. The Governance Committee regularly assesses the size of the Board, the need for particular expertise on the Board, the need for diversity on the Board, and whether any vacancies on the Board are expected due to retirement or otherwise. In the event that vacancies are anticipated or arise, the Governance Committee considers potential candidates for director which may come to the Governance Committee’s attention through current Board members, professional search

firms, shareholders, or other persons. These candidates will be evaluated at regular or special meetings of the Governance Committee and may be considered at any time during the year.

Under the Guidelines, the Governance Committee is responsible for reviewing with the Board the requisite skills and characteristics of new Board nominees in the context of the current Board composition. This assessment will include experience in industry, finance, administration, operations, marketing, and technology, as well as diversity.

Although the Board does not have a formal policy specifying how diversity of background and personal experience should be applied in identifying or evaluating director nominees, to help ensure that the Board remains aware of and responsive to the needs and interests of our shareholders, employees, clients, and other stakeholders, the Board believes it is important to identify qualified director candidates that would increase the diversity of experience, profession, expertise, skill, background, gender, racial, ethnic, cultural, and other diversity characteristics (“Diversity Characteristics”) of the Board. Accordingly, the Governance Committee has made an effort when nominating new directors to ensure that the composition of the Board reflects broad Diversity Characteristics.

In recent years, the Governance Committee has directed its third-party search firm to present a slate of possible candidates which includes qualified potential nominees with broad Diversity Characteristics in considering nominees for the Board.

The Governance Committee considers the entirety of each candidate’s credentials, in addition to diversity, as they fit with the current composition and skills and experience of the Board. The Company considers the Board to be a valuable strategic asset of the Company. To maintain the integrity of this asset, the membership of the Board has been carefully crafted to ensure that its expertise covers broad Diversity Characteristics, and these Diversity Characteristics will continue to be considered when nominating individuals to serve on the Board.

The Governance Committee will consider candidates recommended by shareholders. The Governance Committee will make an initial analysis of the qualifications of any candidate recommended by shareholders or others pursuant to the criteria summarized in this section to determine whether the candidate is qualified for service on the Board before deciding to undertake a complete evaluation of the candidate. If a shareholder or professional search firm provides any materials in connection with the nomination of a director candidate, such materials will be forwarded to the Governance Committee as part of its review. If the Governance Committee determines that additional consideration is warranted, it may engage a third-party search firm to gather additional information about the prospective nominee’s background and experience and report its findings to the Governance Committee. Other than the verification of compliance with procedures, shareholder status, and the initial analysis performed by the Governance Committee, the Governance Committee will treat a potential candidate nominated by a shareholder like any other potential candidate during the review process. In connection with this evaluation, the Governance Committee will determine whether to interview the prospective nominee. One or more members of the Governance Committee, and others as appropriate, will interview the prospective nominees in person or by telephone. After completing this evaluation and interview, the Governance Committee will make a recommendation to the full Board as to the persons who should be nominated by the Board, and the Board will determine the nominees after considering the recommendation and report of the Governance Committee.

Periodically, the Corporate Governance and Nominating Committee (“Governance Committee”) engages a third-party consultant to review the retainer and committee fees paid to the non-employee directors on our Board. This consultant provides information related to the retainer and fee levels of our peer companies, as well as information regarding best practices and emerging trends in the payments to non-employee directors. Information provided by the consultant is considered by the Governance Committee but does not directly determine any of the Company’s actual retainer or fee arrangements. The Governance Committee applies its informed judgment when establishing the levels and payments of retainers and fees. In September 2023, the Governance Committee performed a benchmarking study and found the current fees were positioned near the median of the peer group. In light of this information, the Governance Committee determined that the existing fee structure, outlined below, did not warrant any changes for 2024.

For 2023, non-employee directors received the following cash compensation paid in quarterly installments: (a) an annual cash Board retainer, (b) an annual cash committee retainer, and, if applicable (c) an annual cash committee chair supplement. The schedule of payments for 2023 are set forth in the table below.

Each non-employee director also receives an annual grant of restricted stock units (“RSUs”) that is typically granted on the second day after the release of our annual earnings. The Common Stock underlying these RSUs fully vest on the first day of the Company’s fourth quarter in the year in which they are granted. Non-employee directors appointed during the year are entitled to receive a pro rata grant, on their first day of service to the Board, as follows: 100% if appointed on or prior to the first quarterly meeting, 75% if appointed on or prior to the second quarterly meeting, 50% if appointed on or prior to the third quarterly meeting, and 25% if appointed on or prior to the last quarterly meeting of the year.

In 2023, the Board Chair received an award of RSUs with a target value of $175,000. All other non-employee directors received an award of RSUs with a target value of $135,000. The Audit Committee and Compensation Committee Chairs received an additional award of RSUs with a value of $10,000 while all other committee chairs received an additional award of RSUs with a target value of $7,500. The Company determined the number of RSUs of each such award based on the average closing price of Common Stock during the 60 trading days prior to and including the second full trading day after the announcement of the Company’s fourth quarter and year-end financial results, which was approximately $20.03 per share.

Each non-employee director is able to participate in the Equity Retainer and Deferred Compensation Plan for Non-Employee Directors (“Director Equity Plan”). Under this plan, a director may elect to modify the manner in which he or she receives the annual retainer from the Company. Directors are given the option to make an irrevocable election to convert up to 100% of his or her cash retainer to an equity retainer, and then further elect to receive up to 50% of the equity retainer in the form of stock options, rather than Common Stock. In addition, a director may make an irrevocable election to defer settlement of all or part of his or her annual RSU grant to a time after he or she leaves the Board.

Taryn R. Owen, 45, assumed the role of President and Chief Executive Officer and was appointed as a Director of the Company in September 2023, after serving as President and Chief Operating Officer of TrueBlue and President of PeopleReady and PeopleScout since September 2022. Over her 13-year tenure, she has led TrueBlue through significant periods of growth, was instrumental in its pandemic response and recovery, spearheaded its digital transformation strategies, and successfully led several acquisitions and substantial international expansion. Previously at TrueBlue, Ms. Owen served as Executive Vice President of TrueBlue and President of PeopleReady and PeopleScout from 2021 to 2023, Executive Vice President and President of PeopleReady from 2019 to 2021, and Executive Vice President and President of PeopleScout from 2014 to 2019. Prior to these roles, she served as Senior Vice President of Global Operations and as Vice President of Client Delivery at PeopleScout. Ms. Owen has more than 25 years of staffing and talent acquisition experience. Before joining TrueBlue, she was an Operations Director at Randstad Sourceright Solutions, where she led global RPO engagements. She formerly served as a member of the Board of Advisors of HRO Today and as a member of the Human Capital Industry Advisory Board for Wharton’s Center for Human Resources. Ms. Owen has been recognized for her industry leadership, including annual appearances on the Staffing Industry Analysts’ (SIA) Staffing 100 and Global Power 150.

Carl R. Schweihs, 39, has served as Executive Vice President and Chief Financial Officer since October 2023. He previously served as Executive Vice President of the Company and President of PeopleManagement, TrueBlue’s staffing business that is made up of Staff Management SMX, SIMOS Insourcing Solutions, and Centerline Drivers, from June 2019 until October 2023, after serving as Senior Vice President of the Company for Strategic Accounts since June 2017. Prior to that, he served as Vice President of Finance for the Company since November 2015, after serving as Controller since June 2014. Mr. Schweihs joined the Company following its acquisition of Seaton in 2014. Prior to joining the Company, he served in a variety of financial leadership roles at Seaton and Grant Thornton.

Garrett R. Ferencz, 47, has served as Executive Vice President and Chief Legal Officer of the Company since July 2020, after serving as Senior Vice President, General Counsel and Chief Ethics and Compliance Officer since December 2019. Prior to these roles, he served as Vice President, Deputy General Counsel and Chief Compliance Officer since April 2018, and served as Vice President, Deputy General Counsel, Litigation since July 2014. Mr. Ferencz joined the Company in January 2007 as Senior Director of Litigation, Assistant General Counsel. Prior to joining the Company, Mr. Ferencz practiced litigation at The Blankenship Law Firm, P.S. and Perkins Coie LLP. Mr. Ferencz has served as a Director on the American Cancer Society’s Board for Washington State since 2017.

Richard P. Betori, 63, has served as Executive Vice President of the Company and President of PeopleScout since March 2023, after serving as Managing Director of the Americas of PeopleScout since November 2021. Prior to these roles, he served as Senior Vice President, On Demand Operations since June 2020, after serving as Senior Vice President, Operation and Innovation since April 2015. Mr. Betori joined the Company in January of 2011 as President of StudentScout. Prior to joining the Company, Mr. Betori served as President of Wonderlic, Inc. and had founded and served as President of INSinc Management Consulting.

Kristy A. Willis, 54, has served as Executive Vice President of the Company and President of PeopleReady since March 2023, after serving as Senior Vice President, Chief Sales and Operations Officer of PeopleReady since November 2021. Prior to these roles, she served as Senior Vice President, Sales at PeopleReady since August 2018. Prior to joining the Company, Ms. Willis served in a variety of leadership roles at The Adecco Group.

2023 was a year of transition for our executive team and economic challenges for our Company. Our Compensation Committee established and adjusted our 2023 compensation program to manage these transitions and economic head winds.

As part of our planned succession process managed by our Corporate Governance and Nominating Committee, on August 15, 2023, the Company announced that our then current President and Chief Operating Officer (“COO”), Taryn Owen, would become President and Chief Executive Officer (“CEO”) of the Company, succeeding Steve Cooper, effective September 12, 2023. Mr. Cooper continued to serve in an advisory role, to ensure a smooth transition for Ms. Owen, until his retirement from the Company on December 31, 2023. Ms. Owen had previously served as COO and President of PeopleReady and PeopleScout, our two most profitable lines of business since September 22, 2022, and prior to this position had served as Executive Vice President (“EVP”) of the Company and President of PeopleReady and PeopleScout. For more information regarding the process followed by the Company regarding the appointment of Ms. Owen, please see the Corporate Governance section above.

On October 10, 2023, the Company announced that Carl Schweihs, then EVP and President of the Company’s PeopleManagement Division, would become EVP and Chief Financial Officer (“CFO”) of the Company, succeeding Derrek Gafford, effective October 30, 2023. Mr. Gafford also continued to serve in an advisory role until December 31, 2023, to ensure a smooth transition to Mr. Schweihs as CFO.

In March 2023, the Company appointed Richard Betori as EVP and President of PeopleScout and Kristy Willis as EVP and President of PeopleReady.

As a result of these transitions, as of December 31, 2023, our Named Executive Officers (“NEOs”) were:

The Committee set meaningful goals to motivate NEO performance, manage these transitions and create value for shareholders. Despite the challenging market conditions, our NEOs provided operational control through disciplined cost management, maintaining a strong balance sheet and liquidity position while returning capital to shareholders via share repurchases. The Company generated over $1.9 billion of revenue, generated $29.0 million of Adjusted EBITDA¹, and returned $33.9 million to shareholders in stock repurchases during the year.

Departing executives received meaningful, but not excessive separation packages as part of employment agreements established in prior years and reflecting decades of service to the Company.

With the appointment of each new executive, the Compensation Committee considered the appropriate level of salary, short-term incentive (“STI”) and long-term incentive (“LTI”) levels and consulted with their independent compensation consultant where appropriate to ensure that compensation levels for individuals in new roles reflected the Company’s compensation goals for each position. When Ms. Owen was appointed to serve as CEO, the Compensation Committee also discussed her compensation and individual incentive goals with all other independent members of the Board. The Compensation Committee approved the compensation for all new NEOs in 2023 prior to their appointment.

Our executive compensation programs are designed to reflect performance, and our 2023 results fell short of the challenging annual and multi-year performance targets set by the Compensation Committee. Reflecting the Company’s commitment to pay for performance, the Company’s financial outcomes resulted in our NEOs achieving only a portion of the compensation targets established by our Compensation Committee for 2023.

Below is a summary of each of the components of the 2023 STI plan for the NEO's as approved by the Compensation Committee.

The Compensation Committee designs our executive compensation program to appropriately align the interests of the Company’s management team with shareholders. We expect executive compensation to reflect Company and individual performance. Key pay-for-performance features of our 2023 compensation program included:

The Company has made environmental, social, and governance (“ESG”) best practices a part of its corporate practices and initiatives, with a specific focus on human capital management (“HCM”). The Company also incorporates ESG and HCM goals in its executive compensation program. During 2023, the CEO’s (and COO’s) STI plan included individual objectives tied to leadership development, succession planning for management positions, and enhancing the employee experience to increase retention. Goals for other NEOs tied to ESG included establishing our first ever carbon and emission goals, expanding our WorkUp program to upskill workers, piloting a nationwide second chance initiative, building a positive culture in individual business units, leadership development and succession planning, and increasing participation in our ethics programs across the Company.

 

 

The Company provides shareholders an annual “say-on-pay” advisory vote on its executive compensation program. At our 2023 Annual Meeting of Shareholders, shareholders expressed support for the compensation of our NEOs, with 88% of the votes cast for approval of the “say-on-pay” advisory vote. After our 2023 annual meeting, our CEO, CFO, and other members of management met with over 30 investors to introduce our new leadership structure and discuss matters of concern to these shareholders. The Compensation Committee discussed and considered shareholder feedback provided directly to management during these shareholder engagement activities. The Compensation Committee considered this shareholder feedback and the results of the 2023 advisory vote in evaluating the Company’s executive compensation programs. In light of investor feedback, the Compensation Committee has continued to improve disclosures related to the executive compensation program and considered additional modifications to the executive compensation program in 2024.

As part of its oversight of our compensation program, the Compensation Committee regularly reviews the various components of our executive compensation plans. The Compensation Committee concluded that the plans do not create risks reasonably likely to have a material adverse effect on the Company and the plans encourage appropriate, but not excessive, levels of risk-taking.

The 2023 STI plan focused on multiple goals, including Adjusted EBITDA, revenue growth measured against our Revenue Peer Group, resource management, leadership development, ESG and HCM initiatives, operational goals, and Company profitability. Appropriate payouts were provided for achieving these goals. Another component of the Company’s balanced compensation approach is the LTI plan, which is a significant portion of the NEOs’ compensation, and includes time-based RSU awards and performance-based PSU awards. The vesting and performance requirements of these awards provide meaningful alignment with shareholder interests.

The Compensation Committee designs our annual executive compensation program with the goal of achieving the following objectives:

Compensation for our executives is determined by the Compensation Committee. The Compensation Committee sets and approves the CEO’s compensation levels and awards. This Committee, with participation from the other independent directors on the Governance Committee, is also responsible for reviewing the corporate goals and objectives relevant to the compensation of the CEO and evaluating the CEO’s performance in light of those goals and objectives. The Compensation Committee oversees, regularly reviews, and approves compensation programs for our CEO and other NEOs.

The Compensation Committee has regularly scheduled meetings each quarter and has additional meetings as appropriate. During 2023, the Compensation Committee met seven times. The agenda for each meeting is set by the Chair of the Compensation Committee. The Compensation Committee has full authority to directly retain the services of outside counsel and compensation consultants and has done so on a regular basis. Our CEO and other NEOs may also attend portions of the Compensation Committee meetings in order to provide information and help explain data relating to matters under consideration by the Compensation Committee. They are not present during deliberations or determinations of their respective compensation or during executive sessions that occur without management present in connection with each meeting. Outside counsel and independent compensation consultants also regularly attend Compensation Committee meetings.

In determining executive compensation plans and approving incentive targets, the Compensation Committee considers its compensation objectives, shareholder value creation, compensation practices of our peers in the marketplace, the roles and responsibilities of each NEO, and internal pay equity. The Compensation Committee seeks to align compensation with our current and long-term business strategy and goals. There is no formal weighting of any of these factors; the Compensation Committee uses its informed judgment in determining pay targets and amounts. The Compensation Committee reviews and discusses annual pay elements each year. The Compensation Committee uses the target amounts of these key elements to determine the annual at-target total direct compensation of our NEOs, which is a useful measure of pay because it reflects the intended aggregate value of those key elements of pay at the time the pay decision is made. It evaluates other programs as needed based on changes in compensation objectives, alignment with overall Company direction and business strategy, competitive trends, accounting rules, and changes in tax and other laws and regulations.

The Compensation Committee engages an independent compensation consultant. In 2023, this consultant was Mercer US LLC (“Mercer”). The Compensation Committee evaluates the independence of Mercer to ensure that no conflicts of interest of any kind exist between Mercer and the Company, including personal or business relationships between Mercer and the Company, Company directors, or Company executive officers, Company stock ownership by Mercer, or engagement of Mercer by the Company for other material services. Mercer attends key meetings of the Compensation Committee and is available to the Compensation Committee as necessary.

Information provided by Mercer is considered by the Compensation Committee but does not directly determine any of the Company’s actual compensation decisions. The Compensation Committee applies its informed judgment when establishing the compensation elements, targets, and final awards.

Our executive compensation program is reviewed annually, with a detailed review of peer compensation every two years or as needed, so that the Compensation Committee can remain informed of changes in the compensation programs maintained by similarly-situated peer companies. For executive compensation during 2023, this review occurred in late 2021. This study was updated during 2023 for considering the salary levels applicable to Ms. Owen and Mr. Schweihs with their appointment to CEO and CFO, respectively. For this review, the Compensation Committee retained Mercer to provide an in-depth external review of our executive compensation programs as compared to a peer group (“Compensation Peer Group”). The Compensation Committee selects the Compensation Peer Group from similarly-sized companies engaged in staffing, outsourced human resources services, or companies that operated in industries with multi-unit branches on a national basis.

The report received from Mercer (“2021 Mercer Report”) of external Compensation Peer Group pay practices provided comparative data related to base salaries, actual and target STI and LTI, and total direct compensation. The 2021 Mercer Report was based on information compiled from both Compensation Peer Group proxy data and published salary surveys compiled by Mercer. The data from the Compensation Peer Group was combined with national published

surveys compiled by Mercer (U.S. Global Premium Executive Remuneration Suite) and Willis Towers Watson (Survey Report on Top Management Compensation). The Compensation Peer Group for 2022-2023 included the 16 companies set forth in the table below, which remained unchanged from the 2020-2021 Compensation Peer Group:

The 2021 Mercer Report found the following with respect to the Company’s executive compensation:

The Company strives for total direct compensation to be approximately at the median of the Compensation Peer Group. After referring to the data provided, the Compensation Committee approved increases to the 2023 compensation targets for Mr. Gafford and Mr. Ferencz. During 2023, when considering the compensation levels of newly promoted NEOs, the Compensation Committee referred to this study, as well as updates to the study provided by the independent compensation consultant, when considering pay levels for NEOs.

The Compensation Committee set targets for Company and business unit performance, as applicable, under the 2023 STI plan based on target levels of achieved Adjusted EBITDA, a non-GAAP measure defined below. For purposes of the 2023 STI plan, consistent with our investor presentations, the Compensation Committee excluded from earnings before interest, taxes, depreciation and amortization (“EBITDA”): third-party processing fees for hiring tax credits, PeopleReady technology upgrade costs, amortization of software as a service assets, goodwill and intangible asset impairment charges, executive leadership transition expenses, and other adjustments (“Adjusted EBITDA”)². The Compensation Committee decided that excluding such items in assessing management performance more closely aligned management incentives with shareholder interests. Adjusted EBITDA is a key metric used by management to evaluate the performance of the Company. The Compensation Committee also believes aligning executive compensation with Adjusted EBITDA incentivizes management to appropriately control costs while increasing revenue. Finally, Adjusted EBITDA is a metric that is reviewed by, and considered important to, our investors in measuring our performance.

In 2023, the Compensation Committee selected ROE as the performance metric for the 2023 PSUs after considering several other potential targets and metrics, including stock price, total shareholder return, earnings per share, and other relative and absolute metrics. The Compensation Committee believed ROE was an appropriate performance metric for aligning the NEOs’ interests with the Company’s long-term goals and shareholder interests. Among other benefits, a focus on ROE encourages our NEOs to make business decisions with a balanced view of increasing Company profitability, the effective use of capital, and value creation for shareholders. ROE is calculated as adjusted net income, divided by average equity, which is measured quarterly during the performance period.

The LTI plan was designed to align the interests of the NEOs with those of our shareholders. The combination of vesting requirements and stock ownership guidelines is intended to promote retention and a long-term commitment to the Company. The Compensation Committee has determined that PSUs provide the most direct link between executive compensation and specific long-term performance goals that are aligned with the Company’s business objectives and shareholder interests.

Our pay-for-performance philosophy and the meaningful goals we apply to our executive compensation program are evidenced by our payouts over the past nine years for our PSU awards as shown below. Participants in our LTI plan have not received a PSU payout for three of the last nine years. As disclosed in prior proxy statements and this proxy statement, PSU awards for the 2015-2017, 2016-2018 and 2021-2023 performance periods were not earned because the Company did not meet the minimum performance conditions approved by the Compensation Committee. In the past few years, PSU payouts have been meaningful but below target as Company performance levels have not met targets set by the Compensation Committee.

 

The 2023 STI plan for our NEOs measured and rewarded performance against three components, weighted as follows:

(1) 25% for the Company’s Adjusted EBITDA performance for Ms. Owen and Messrs. Cooper, Schweihs (as CFO), Gafford, and Ferencz and Adjusted EBITDA performance of the business unit directly under their respective control for Messrs. Schweihs (as President of PeopleManagement) and Betori and Ms. Willis (as President of PeopleScout, and PeopleReady, respectively); (2) 25% for the Company’s relative revenue growth as compared to the Revenue Peer Group, defined in the Executive Compensation Process, Governance, and Philosophy section above; and (3) 50% for individual performance. The table below shows the performance components (Company/Business Unit, and Relative Revenue Growth, and Individual) and threshold, target, and maximum payout levels approved by the Compensation Committee for the 2023 STI plan.

Consistent with the objective that potential compensation reflects the role and responsibilities of each NEO, the STI potential varies by NEO to reflect the individual’s market value and role within the Company. The STI is completely at risk, and no cash award will be made unless the individual, Company/business unit, or relative revenue growth thresholds are met.

The individual performance component of the 2023 STI plan allowed NEOs to earn up to 120% of their target award. The Compensation Committee considers this exercise of discretion appropriate in order to have the ability to acknowledge and reward possible extraordinary achievement in some portions of the individual performance goals. The Committee also approved threshold, target, and maximum potential payouts according to potential Adjusted EBITDA and relative revenue growth results for the Company. Award levels are interpolated between levels beginning at the threshold level where 25% of the target is awarded, up to the maximum level where 200% of the target is awarded.

The Company’s Adjusted EBITDA target for the STI plan in 2023 was $80.0 million, with the threshold set at $50.0 million and maximum set at $120.0 million. Due to the challenging economic environment, the Company generated only $29.0 million in Adjusted EBITDA, and as a result, Ms. Owen, and Messrs. Cooper, Gafford, and Ferencz earned zero payout for this component of the STI plan. These targets were set in early 2023 to align with the Company’s internal forecasts which anticipated that 2023 would reflect a challenging economic cycle for the Company’s markets and aligned with guidance provided quarterly to investors during the year.

The 2023 STI opportunity for Mr. Schweihs included a component focused on the performance for PeopleManagement, the specific business unit under his management. The 2023 Adjusted EBITDA target for PeopleManagement was $14.0 million, with the threshold at $10.0 million and the maximum at $19.3 million. PeopleManagement’s actual Adjusted EBITDA was $7.0 million, resulting in zero payout to Mr. Schweihs for this component of his STI plan.

The 2023 STI opportunity for Mr. Betori included a component focused on the performance for PeopleScout, the specific business unit under his management. The 2023 Adjusted EBITDA target for PeopleScout was $45.0 million, with the threshold at $32.0 million and the maximum at $61.9 million. PeopleScout’s actual Adjusted EBITDA was $26.9 million, resulting in zero payout to Mr. Betori for this component of his STI plan.

The 2023 STI opportunity for Ms. Willis included a component focused on the performance for PeopleReady, the specific business unit under her management. The 2023 Adjusted EBITDA target for

PeopleReady was $53.0 million, with the threshold at $37.5 million and the maximum at $73.2 million. PeopleReady’s actual Adjusted EBITDA was $26.6 million, resulting in zero payout to Ms. Willis for this component of his STI plan.

The Compensation Committee selected the following Revenue Peer Group (as measured by specific revenue segments) for the relative revenue growth component of the 2023 STI plan:

In each case, the Compensation Committee selected the reporting segment most comparable to the Company’s business, adjusted for organic results, consistent billing days, constant currency, and similar factors. The Company’s relative revenue growth target as compared to the Revenue Peer Group for the 2023 STI plan was 0%, or the same revenue growth as the average revenue growth for the Revenue Peer Group, with the threshold set at the Company’s revenue growth being 5% lower than the average revenue growth of the Revenue Peer Group and maximum set at the Company’s revenue growth being 5% greater than the average revenue growth of the Revenue Peer Group. As a result of the NEOs’ management efforts during 2023, the Company achieved revenue growth that was 0.7% lower than the average revenue growth of the Revenue Peer Group during 2023. As a result, the NEOs earned a payout of 90% of target for this component of the STI plan.

Ms. Owen’s individual performance incentive for 2023 was based on specific performance goals first in her role as COO and then in her role as CEO as reflected in the chart above. At the end of the year, each director, except Ms. Owen, independently evaluated each area of Ms. Owen’s performance in both the COO and CEO role. The evaluations were aggregated and discussed at the December 2023 meeting of the Governance Committee. All members of the Compensation Committee were present and participated in this evaluation discussion. The Governance Committee made its performance evaluation recommendations. The Compensation Committee considered this recommendation and determined the amount of compensation that was appropriate to reward for this performance, concluding that Ms. Owen performed at a level that entitled her to receive 100% of her target for the individual performance component of the STI plan as COO, or $252,608, and 120% of her target award in her role as CEO, or $235,381.

Mr. Cooper’s individual performance incentive for 2023 was based on specific performance goals involving his areas of responsibility as reflected in the chart above. At the end of the year, each director,

except Ms. Owen, independently evaluated each area of Mr. Cooper’s performance. The evaluations were aggregated and discussed at the December 2023 meeting of the Governance Committee. All members of the Compensation Committee were present and participated in this evaluation discussion. The Governance Committee made its performance evaluation recommendations. The Compensation Committee considered this recommendation and determined the amount of compensation that was appropriate to reward for this performance, concluding that Mr. Cooper performed at a level that entitled him to receive 100% of his target for the individual performance component of the STI plan, or $750,000.

The individual performance goals for other NEOs focused on categories such as growth, HCM, profit and loss responsibilities, strategic planning, change leadership, and our ethics program, as more specifically reflected in the chart above. Based on Ms. Owen’s recommendations, where applicable, as reviewed and approved by the Compensation Committee, Mr. Schweihs received 100% in his role as President of PeopleManagement and 120% in his role as CFO,

Mr. Gafford received 100%, Mr. Ferencz received 115%, Mr. Betori received 96%, and Ms. Willis received 92%, of his or her respective target for the individual performance component of the STI plan.

Similar to previous years, the 2023 annual equity awards for NEOs were comprised of a combination of RSU and PSU awards. The value of the annual long-term equity awards is allocated equally between annual PSU grants and RSU grants to provide an appropriate balance between long-term performance incentives and retention goals.

In addition, consistent with our Company policy that is generally applicable to all employees who participate in the annual equity award program, our NEOs promoted in 2023 also received equity grants according to this policy.

The number of RSUs granted was calculated by dividing the target dollar value of the award by the average closing price of the Common Stock during the 60 trading days preceding and including the grant date. The annual grant date is the second trading day after the announcement of fourth quarter and year-end results, which, for the 2023 grant, was February 3, 2023.

In early 2023, the Compensation Committee determined that ROE was the best available measure of the Company’s performance to align our NEO’s interests with shareholders. As in prior years, the Compensation Committee determined that a return metric has a high correlation with value creation for shareholders. Among other benefits, maintaining long-term ROE encourages our NEOs to make business decisions with a focus on the effective use of capital.

As such, the PSUs awarded in 2023 are earned and have the potential to vest depending on the Company’s cumulative average ROE over a three-year performance period. The Compensation Committee established the target ROE at the beginning of the performance period and will compare that growth target to the three-year cumulative ROE upon completion of the performance period to determine achievement. The PSU awards are completely at risk and the underlying shares of Common Stock will be issued only if the established targets are met at the completion of the three-year performance period.

The Compensation Committee calculated the target number of PSUs awarded by dividing the target dollar value of the award by 80% of the average closing price of Common Stock during the 60 trading days preceding and including the grant date. Mercer recommended this 20% discount to reflect the contingent nature of the PSUs and the risk of forfeiture.

The Compensation Committee established and approved threshold, target, and maximum vesting rates of PSUs according to potential ROE results for the Company. Award levels will be interpolated between levels beginning at the 25% threshold level up to the 150% maximum level. The number of PSUs earned and vested at the end of the three-year award period will be determined by the ROE achieved during the performance period as shown in the table below. These targets were set in early 2023 to align with the Company’s internal forecasts which anticipated challenging economic conditions for the Company and its customers. These forecasts were generally reflected in the guidance provided quarterly to investors during the year. In 2023, target performance level remained unchanged from prior years to reflect the Committee’s desired performance level but reduced both the threshold performance level and payout amount to provide a meaningful opportunity to achieve a portion of this component of the long-term incentive program.

Consistent with our Company policy that is generally applicable to all employees who participate in the annual equity award program, our NEOs promoted in 2023 also received equity grants according to this policy.

The number of shares for these awards was calculated by dividing the award’s target dollar value by the average closing price of the Company’s stock during the 60 trading days preceding and including the grant date. These promotional awards will vest in equal annual installments over four years.  

Messrs. Gafford, Schweihs, and Ferencz and Ms. Owen each received PSUs as a component of their total long-term equity awards in 2021, which would vest, if at all based on the Company’s achievement of Adjusted EBITDA CAGR goals over the three-year performance period. During the 2021-2023 performance period the Company achieved an Adjusted EBITDA CAGR of -9.2%, which was below the threshold Adjusted EBITDA CAGR of 25%, resulting in zero PSUs being earned for this award.

In 2021 the Compensation Committee considered the need to ensure the retention and engagement of the experienced and tenured leadership of the Company during the Company’s recovery from the pandemic-related recession and in light of the increasingly competitive market for talent in the industry and made certain one-time additions to the compensation packages of three NEOs. As a result, Ms. Owen, and Messrs. Gafford and Schweihs received one-time retention grants of PSUs (“Retention PSUs”) with a grant date of February 5, 2021.

The Retention PSU grants were based on a target value of $700,000 for Ms. Owen, $600,000 for Mr. Schweihs, and $400,000 for Mr. Gafford. Up to 50% of these awards vested on the second anniversary of the grant for the 2021-2022 performance period (“Tranche 1”), and up to 50% plus any portion of Tranche 1 not previously earned could be earned based on performance over the 2021-2023 performance period and vest on the third anniversary of the grant (“Tranche 2”), in each case, only if certain individual performance criteria were met. In no event would more than 100% of the award be earned by the NEOs. These Retention PSUs were completely at risk and would not vest in any amount if the individual performance goals were not met. The individual performance goals were oriented to the long-term strategic growth plans of each individual’s business unit or support function. The Compensation Committee calculated the target number of Retention PSUs awarded by dividing the target dollar value of the award by the average closing price of the Common Stock during the 60 trading days preceding and including the grant date.

As mentioned in last year’s proxy statement, in January 2023, the Compensation Committee met and discussed the level of achievement of each of the executives’ individual performance goals for Tranche 1 within their respective Retention PSU performance criteria. As a result of those discussions, Ms. Owen and Messrs. Gafford and Schweihs earned 40%, 40%, and 50%, of their respective Retention PSUs which resulted in the vesting of that portion of the Retention PSUs into shares of Common Stock on February 5, 2023.

In December 2023, the Compensation Committee met and discussed the level of achievement of each of the executives’ individual performance goals for Tranche 2 within their respective Retention PSU performance criteria. As a result of those discussions, Ms. Owen and Messrs. Gafford and Schweihs earned 60%, 60%, and 50%, of their respective Retention PSUs which resulted in the vesting of that portion of the Retention PSUs into shares of Common Stock on February 5, 2024.

During late 2023 and early 2024, the Committee, the Company’s management, and the Committee’s independent compensation consultant considered changes to the executive compensation program for Company executives. The Committee considered evolving market practices, changes in Company strategy, and the need to properly incentivize NEOs to focus on Company growth and increasing shareholder value. The Committee decided that an effective way to emphasize both of these goals was to split the PSU portion of the LTI plan into two components. The first component, comprised of a majority of the award, would vest based upon Adjusted EBITDA levels achieved and aggregated over the 2024-2026 performance period. The second component of the 2024 LTI plan will be based on the achievement of relative total shareholder return targets over this same period, as measured against a designated peer group.

The NEOs, on the same basis as our other highly compensated employees, as defined in Internal Revenue Service (“IRS”) regulations, are entitled to participate in the Deferred Compensation Plan. The NEOs are not entitled to participate in the Company’s 401(k) plan. The Company’s Deferred Compensation Plan allows participants to maintain their balances in the Deferred Compensation Plan upon termination of employment if a participant has attained the age of 65 years or attained the age of 40 years and achieved five years of credited service.

Under the Deferred Compensation Plan, eligible employees may defer up to 75% of base salary and up to 100% of amounts received under the STI plan. The Deferred Compensation Plan also includes in-service accounts that allow distribution of contributions during employment and installment payments for distributions (up to 10 years) for additional flexibility for tax purposes and retirement planning. Under the Deferred Compensation Plan, the Company can match employee contributions at double the rate matched under the Company’s 401(k) plan and such matching funds will be immediately vested. In 2023, the match was 50% of contributions to the plan up to $22,500. Details of amounts contributed to each NEO’s 2023 deferrals are provided in the Nonqualified Deferred Compensation Table in the Executive Compensation Tables section. Under the Deferred Compensation Plan, the Company can also make contributions with different vesting schedules for retention purposes, but no such contributions were made during 2023.

The Compensation Committee believes the Deferred Compensation Plan is necessary as a competitive, meaningful retirement benefit for those employees who are eligible to participate, which includes the NEOs, and does not impose any significant risk to or burden on the Company.

The NEOs, on the same basis as other employees, are entitled to participate in the Company Employee Stock Purchase Plan. This plan allows NEOs to contribute up to 10% of their earnings toward the monthly purchase of Common Stock. The employees’s purchase price is 85% of the lesser of the fair market value of the shares on either the first day or the last day of each month.

The Company has entered into employment agreements with each of the NEOs, under which each NEO may be entitled to payments upon termination of employment under the circumstances described in the Post-Employment Payments section below. The Compensation Committee believes that the termination payments under the employment agreements are necessary to attract and retain high caliber executives in a competitive labor market and to motivate them to contribute to our short- and long-term success for the benefit of our shareholders. The Compensation Committee designed the termination payments, which are competitive with our Compensation Peer Group and general industry practices, to achieve a balance between these objectives and the potential impact on shareholders.

The Company has entered into change-in-control agreements with certain executive officers, including all NEOs, which were approved by all the independent directors. These agreements are described in greater detail in the Post-Employment Payments section below. The change-in-control agreements are intended to protect the interests of our shareholders by providing short-term security for the executives in the event management and the Board are presented with a business combination or other opportunity that is determined to be in the best interest of our shareholders. The Compensation Committee designed the change-in-control agreements to achieve a balance between the benefits of providing executives with security and the potential impact on the shareholders.

The Compensation Committee has established stock ownership guidelines for executive officers as follows: a multiple of four times the annual RSU grant for the CEO and a multiple of three times the annual RSU grant for EVPs.

NEOs are expected to achieve their targets within five years of becoming subject to the ownership guidelines. As of the date of this proxy, all NEOs that are employed by the Company met these guidelines or were within the five-year period and on track to meet these guidelines.

The ownership guidelines recognize the significant range of equity awards each NEO is eligible to receive annually, while continuing to require a substantial personal commitment to the Company’s long-term financial performance. The guidelines may be satisfied by shares owned outright (regardless of whether acquired through a Company plan or other acquisition), unvested restricted shares or RSUs, or shares held in the NEO’s account under our employee stock purchase plan. Unvested PSUs may not be used to satisfy the stock ownership guidelines. Compliance with the guidelines is reviewed on an ongoing basis. NEOs who have not satisfied the applicable guidelines after becoming subject to them are encouraged to retain 50% of the net amount of their shares (after applicable taxes) on each vesting date for their RSU awards.

In 2023, the Company adopted the Incentive Compensation Recovery Policy (the “Clawback Policy”) in response to the new SEC and NYSE rules. The Clawback Policy was effective as of September 14, 2023 and applies to all current and former NEOs and certain other executives who receive incentive-based compensation on or after the effective date. Under this policy, the Company will recover the incentive compensation awarded or paid that exceeds the amount of incentive compensation that would have been received had it been determined based on the restated amount in the event of an accounting restatement of the Company’s financial statements due to the Company’s material noncompliance with any financial reporting requirement under the securities laws, including any accounting restatement required to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period. The recovery of such compensation applies regardless of whether an executive officer engaged in misconduct or otherwise caused or contributed to the requirement for a restatement.

In addition, the clawback policy in effect prior to September 14, 2023 will continue to apply to all current and former NEOs and certain other executives who received incentive-based compensation prior to September 14, 2023. Under this policy, the Company may seek to recover the incentive compensation awarded or paid where: (i) the incentive compensation was calculated based wholly or in part upon the achievement of certain financial results that were subsequently the subject of a restatement; (ii) in the Compensation Committee’s view, the executive engaged in fraud or illegal conduct that materially contributed to or caused the restatement; and (iii) a lower payment would have been made to the executive based upon the restated financial results. The Compensation Committee retains discretion regarding the application of this policy and may determine not to seek recovery from an executive if it determines that to do so would be unreasonable or that it is not in the best interest of the Company and its shareholders.

Under the Company’s Insider Trading Policy, all directors, NEOs, and all other employees are prohibited from hedging the economic interest in our securities that they hold. In addition, we prohibit Company employees, including the NEOs, from engaging in any short-term, speculative securities transactions, including purchasing Company securities on margin, engaging in short sales, buying or selling put or call options, and trading in options (other than those granted by the Company).

The Compensation Committee has reviewed and discussed with management this Compensation Discussion and Analysis as required by Item 402(b) of Regulation S-K. Based on such review and discussions, the Compensation Committee recommended to the Board, and the Board agreed, that the Compensation Discussion and Analysis be included in this proxy statement and our Annual Report on Form 10-K for the year ended December 31, 2023.

William C. Goings, Chair

Colleen B. Brown

Kristi A. Savacool