Proxy Statement (Form DEF 14A)
☐ |
Preliminary Proxy Statement
|
☐ |
Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|
☑ |
Definitive Proxy Statement
|
☐ |
Definitive Additional Materials
|
☐ |
Soliciting Material Pursuant to
§240.14a-12
|
☑ |
No fee required.
|
☐ |
Fee paid previously with preliminary materials.
|
☐ |
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules
14a-6(i)(1)
and 0-11.
|
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
Dear Stockholder:
You are cordially invited to attend the 2025 Annual Meeting of Stockholders (the "Annual Meeting") of
The Annual Meeting will be held for the following purposes:
1. |
to consider the election of twelve incumbent directors of the Company for terms expiring in 2026; |
2. |
to consider the election of |
3. |
to consider the election of |
4. |
to consider the approval, by non-bindingvote, of the 2024 compensation paid to the Company's Named Executive Officers (as defined in the proxy statement) (commonly known as a "say-on-pay"proposal); |
5. |
to ratify the selection of |
6. |
to transact such other business as may properly come before the meeting or any adjournments or postponements thereof. |
Only stockholders of record at the close of business on
The Company is pleased to take advantage of the
To assure your representation at the Annual Meeting, you are urged to cast your vote, as instructed in the Notice Regarding the Availability of Proxy Materials, over the Internet or by telephone as promptly as possible. You may also request a paper proxy card to submit your vote by mail, if you prefer, or vote online during the virtual Annual Meeting.
Whether or not you expect to attend the virtual meeting online, your vote is very important. Please cast your vote regardless of the number of shares you hold. I look forward to discussing our plans for the Company's future at the Annual Meeting.
Chairman and Chief Executive Officer |
135 DURYEA ROAD
PROXY STATEMENT
The Board of Directors of
The presence, in person or by proxy, of the holders of a majority of the outstanding shares of common stock entitled to vote is necessary to constitute a quorum in connection with the transaction of business at the Annual Meeting. Abstentions and broker non-votes(i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other persons entitled to vote shares as to a matter with respect to which the brokers or nominees do not have discretionary power to vote) are counted as present for purposes of determining the presence or absence of a quorum for the transaction of business.
At the Annual Meeting, a "FOR" vote by a majority of votes cast is required for the election of directors (Proposals 1, 2 and 3). A "FOR" vote by a "majority of votes cast" means that the number of shares voted "FOR" exceeds the number of votes "AGAINST." Abstentions and broker non-votesshall not constitute votes "FOR" or votes "AGAINST" a director, and thus will have no effect on the outcome of Proposals 1, 2 and 3. Proposals 4 and 5 each require the affirmative "FOR" vote of the holders of a majority of the outstanding shares of common stock present in person or represented by proxy and entitled to vote on the matter. Broker non-voteswill have no effect on the outcome of Proposals 4 and 5, but abstentions will have the same effect as a vote "AGAINST" each such proposal. Proposals 2 and 3 are contingent on certain regulatory approvals as further described below within each proposal. If the required regulatory approvals for either or both proposals are not received by the date of the Annual Meeting, the Company will withdraw Proposal 2 and/or Proposal 3, as applicable, from voting at the Annual Meeting. However, in the event that Proposal 2 and/or Proposal 3 are withdrawn at the Annual Meeting, the Board will consider any proxies submitted in favor of such Proposals as evidence of stockholder support therefor.
We will pay all expenses of this proxy solicitation. In addition to this proxy solicitation, proxies may be solicited in person or by telephone or other means, including by our directors and employees (who we refer to as our Team Schein Members or "TSMs") without additional compensation. We will reimburse brokerage firms and other nominees, custodians and fiduciaries for costs incurred by them in distributing proxy materials to the beneficial owners of shares held by such persons as stockholders of record.
If your shares of common stock are registered directly in your name with the Company's transfer agent, you are considered, with respect to those shares, the stockholder of record. In accordance with rules and regulations adopted by the
If your shares are held in an account at a brokerage firm, bank, broker-dealer or other similar organization, then you are the beneficial owner of shares held in "street name," and the Notice of Internet Availability was forwarded to you by that organization. The organization holding your account is considered the stockholder of record for purposes of voting at the Annual Meeting. As a beneficial owner, you have the right to direct that organization on how to vote the shares held in your account.
1
If you are a participant in the Company's 401(k) Plan and own shares of the Company's common stock in your 401(k) Plan account as of the record date, you will receive, with respect to the number of shares held for your 401(k) Plan account as of the record date, a proxy card that will serve as a voting instruction to the trustee of the 401(k) Plan with respect to shares held for your account. Unless you vote per the instructions provided therein, shares held in your 401(k) Plan account will not be voted.
This year's Annual Meeting will be held entirely online. Stockholders of record as of the record date will be able to attend and participate in the Annual Meeting online by accessing www.virtualshareholdermeeting.com/HSIC2025. To join the Annual Meeting, you will need to have your 16-digitcontrol number, which is included on your Notice of Internet Availability or on your proxy card (if you received a printed copy of the proxy materials). In the event that you do not have a control number, please contact your broker, bank, or other nominee as soon as possible and no later than
The live audio webcast of the Annual Meeting will begin promptly at
To submit questions during the meeting, stockholders may log into the virtual meeting website with their 16-digitcontrol number, type the question into the "Submit a Question" field, and click "Submit". Only stockholders with a valid control number will be allowed to ask questions. Questions pertinent to Annual Meeting matters will be answered during the Annual Meeting as time allows. If we receive substantially similar written questions, we may group such questions together and provide a single response to avoid repetition and allow time for additional question topics. If we are unable to respond to a stockholder's properly submitted question due to time constraints, we will respond directly to that stockholder using the contact information provided. We may also provide written responses to certain stockholder questions that we were unable to answer during the meeting on our "Investors" page on our website following the Annual Meeting.
To vote your shares at the Annual Meeting online, please visit www.virtualshareholdermeeting.com/HSIC2025and enter the 16-digitcontrol number included in our Notice of Internet Availability or on your proxy card (if you received a printed copy of the proxy materials). Even if you plan to attend the Annual Meeting online, we recommend that you also vote by proxy in advance of the Annual Meeting as described herein so that your vote will be counted if you decide not to attend the Annual Meeting.
To vote your shares without attending the Annual Meeting online or in advance of the Annual Meeting, please follow the instructions for Internet or telephone voting contained in the Notice of Internet Availability. Whether you hold shares directly as the stockholder of record or beneficially in street name, you may direct how your shares are voted without attending the Annual Meeting online. If you are a stockholder of record, you may vote by submitting a proxy electronically via the Internet, by telephone, or if you have requested a paper copy of these proxy materials, by returning the proxy card or voting instruction card. If you hold shares beneficially in street name, you may vote by submitting voting instructions to your broker, trustee or nominee. All shares represented by a valid proxy received prior to the Annual Meeting will be voted.
Whether or not you are able to attend the virtual Annual Meeting online, you are urged to complete and retuyour proxy or voting instructions, which are being solicited by the Company's Board of Directors and which will be voted as you direct on your proxy or voting instructions when properly completed (unless such proposal has been withdrawn as described above). In the event no directions are specified, such proxies and voting instructions will be voted "FOR" the incumbent nominees for election to the Board of Directors, "FOR" the election of
You may revoke or change your proxy or voting instructions at any time before the Annual Meeting. You may automatically revoke your proxy by attending the Annual Meeting and voting online at the meeting. Attending the Annual Meeting online without voting at such meeting will not in and of itself constitute revocation of a proxy. To revoke your voting instructions, you may also submit new voting instructions to your broker, trustee or nominee. Another means to revoke your proxy or change your proxy or voting instructions is to send a written notice via email to investor@henryschein.combefore the beginning of the Annual Meeting.
2
Stockholders who wish to communicate with the Board of Directors may do so by emailing investor@henryschein.com. The Company will receive the correspondence and forward it to the Chairperson of the
Our policy is to encourage the members of our Board of Directors to attend the annual meeting of stockholders, and all of the directors then in office (except for
Stockholder Engagement
As part of the Company's continual efforts to align our programs to reflect priorities that are important to our stockholders, in 2024 and early 2025 we proactively solicited dialogue with our stockholders. We offered engagement to 34 stockholders holding approximately 67% of our outstanding common stock in the aggregate (as of the date of the offer) and engaged with 26 stockholders holding a total of approximately 56% of our outstanding common stock in the aggregate (as of the date of the engagement). Such engagement was led by
Our conversations focused on a wide range of topics, including executive compensation, corporate governance (including board composition and succession planning), acquisition and commercial strategy, cybersecurity, and sustainability initiatives. Our continued engagements in recent years have resulted in several actions summarized in the chart below.
Topics Discussed | Company Actions | |
Executive Compensation |
• The Compensation Committee updated the Company's strategic scorecard goals (which goals directly reflect the priorities of the Company's three-year strategic plan and which make up 30% of the annual cash bonus plan for executive officers, including each Named Executive Officer) to remove all non-financialmetrics (except for a performance objective tied to the launch of our new global e-commerceplatform) and streamlined the financial metrics. • In 2023 and 2024, the Compensation Committee granted equity awards where at least 50% of the executive officers' equity awards and 65% of the CEO's equity awards had performance-based vesting conditions with three-year cliff vesting. • To diversify financial metrics used for performance-based compensation beyond earnings per share metrics, the Compensation Committee added retuon invested capital performance over a three-year performance period (weighted at 25% of the financial goal for performance-based restricted stock unit awards) for all performance-based restricted stock unit awards granted in 2023 and 2024. • The Compensation Committee intends that equity awards outside of the annual grant cycle to executive officers should only be used in limited circumstances and, if made, are expected to include performance-based vesting conditions for a percentage of such awards. |
|
Corporate Governance |
• The Board of Directors has added six new independent directors (as defined under Rule 5605(a)(2) of • The Board of Directors has reduced the number of non-independentdirectors. In 2022, the Company had four non-independentdirectors and at this Annual Meeting, our CEO is the only non-independentdirector nominated for election at the Annual Meeting. • The Board of Directors continues to review and update its ongoing CEO succession planning. |
|
Capital Allocation |
• The Company continues to retucapital to stockholders through our stock repurchase program, which as of • On • The Board of Directors regularly reviews the Company's capital structure. |
3
Cybersecurity |
• In • The Regulatory, Compliance and Cybersecurity Committee provides guidance to the Company's senior management team, supporting significant investments the Company is making in cybersecurity and IT infrastructure. |
On
We appreciate the valuable feedback offered by our stockholders. We will continue these dialogues to ensure our programs reflect priorities that are important to our stockholders.
4
PROPOSAL 1
ELECTION OF INCUMBENT DIRECTORS
The Company's Board of Directors (the "Board of Directors") has approved the twelve persons named below as nominees for election at the Annual Meeting to serve as directors until the 2026 Annual Meeting of Stockholders (the "2026 Annual Meeting") and until their successors are elected and qualified. Each director will be elected by the vote of the majority of the votes cast with respect to that director's election, where a "majority of the votes cast" means that the number of shares voted "FOR" a director must exceed the number of votes cast "AGAINST" that director. Any executed proxies returned to the Company will be voted for the election of all of such persons except to the extent instructed otherwise with respect to one or more of such persons. Two of our currently-serving directors,
The Board of Directors and each committee of the Board of Directors conduct annual evaluations to ensure each of its members continues to meet the criteria for membership. Based on these activities and their review of the current composition of the Board of Directors, the
Set forth below is certain information, as of
|
Age |
Position |
||
|
54 | Director | ||
|
75 | Chairman, Chief Executive Officer, Director | ||
|
61 | Director | ||
|
63 | Director | ||
|
69 | Director | ||
|
59 | Director | ||
|
70 | Director | ||
|
84 | Director | ||
|
69 | Director | ||
|
68 | Director | ||
|
68 | Director | ||
|
74 | Director |
Senior Vice President and Head of |
||
Age: 54 Independent Director since 2021 |
||
Committee |
||
• Strategic Advisory Committee |
||
Professional Experience |
||
• Senior Vice President and Head of |
||
• Former Senior Vice President and Chief Operating Officer of |
||
Corporation (September 2023-June 2024) |
||
• Former CEO and Director, |
||
• Former President and CEO, |
||
• Former Chief Strategy Officer, |
||
• Former President, Avaya Global Services, |
||
• Former Vice President (Business Strategy, |
5
Key Skills & Qualifications
• |
Strategic Transformation: as the former Chief Strategy Officer of |
• |
Management and Leadership Experience: |
• |
Technology Industry Leadership Experience: |
• |
Public Company Board or Governance Experience: |
• |
Corporate Strategy / M&A: |
• |
Corporate Sustainability: |
Other Boards
• |
|
• |
|
• |
|
• |
|
Organizations
• |
Board Member and Former Chairperson, |
• |
Former Board Member, |
Awards & Recognition
• |
Named to |
• |
Named the 2018 CEO of the Year ( |
• |
Member of the 2018 Public Board of the Year ( |
• |
Recognized in 2018 as one of the 100 Most Powerful People in |
• |
Recipient of |
• |
Listed in 2008 as a 40-Under-40( |
• |
Finalist in America's prestigious 1988 Westinghouse Science Talent Search |
Education
• |
M.S., |
• |
B.S., |
• |
B.A., |
6
Chairman of the Board and Chief Executive Officer, Age: 75 Director since 1980 Committee • Executive Management Committee Professional Experience • Chairman of the Board and Chief Executive Officer, |
||
Key Skills & Qualifications • Management and Leadership Experience: • Healthcare Industry Expertise:expansive knowledge of the health care industry and macro-economic global environment gained as Chairman and CEO of • Public Company Board or Governance Experience:almost three decades of experience serving as Chairman of the Board of • Community Involvement: Organizations • Chair, Dean's • Chairman of the Board, The University of the • Governor and Former Co-Chair, • Director Emeritus, • Honorary member, • Honorary member, Awards & Recognition • Awarded Honorary Doctorates: Ø ØWesteUniversity of Health Sciences Ø ØA.T. Still University's Ø Ø ØThe • Awarded Honorary Fellowships: Ø Ø • Recognized as 2017 CEO of the Year by • Recipient, Ellis Island Medal of Honor • Recipient, CR Magazine Corporate Responsibility Lifetime Achievement Award Education • Certified Public Accountant (CPA) • South African Chartered Accountant ( • Graduate, |
7
Operating Partner, CEO, Age: 61 Independent Director since 2021 Committees • Compensation Committee (Chair) • Nominating and Governance Committee |
Professional Experience
• |
Operating Partner, |
• |
Former President and CEO, |
• |
Former President, |
• |
Former Executive Vice President and Vice Chairman, Toys "R" |
• |
Former Chief Administrative Officer, Toys "R" |
• |
Former President of Babies "R" Us, Toys "R" |
• |
Former Employment Law Attorney, |
• |
Former Corporate Attorney at a large law firm in |
Key Skills & Qualifications
• |
Management and Leadership Experience: gained through experience as President and CEO of |
• |
Public Company Board and Governance Experience: service as a member of the board of directors of |
• |
Compensation / Human Resources: gained through experience as Corporate Director of Compensation & Benefits globally at |
• |
Corporate Strategy / Operations: considerable experience across a wide range of industries and markets, and particular expertise in strategy, operations and supply chain management; serves as Operating Partner at |
Other Boards
• |
|
• |
|
Organizations
• |
Former Board Member, Toys "R" |
• |
Former Board Member, K.I.D.S. ( |
Education
• |
J.D., |
• |
M.B.A., |
• |
B.A., |
8
Former Age: 63 Independent Director since 2023 Committees • Audit Committee • Strategic Advisory Committee Professional Experience • Former • Former Partner ( • Former Partner (Audit), |
Key Skills & Qualifications • Healthcare Industry Expertise: gained through experience leading • Management and Leadership Experience:previously held multiple leadership roles in both national and regional capacities at • Finance and Accounting Expertise: Certified Public Accountant (CPA) with a 38-year career as an Audit Partner at • Human Capital Matters:recognized for her leadership related to human capital matters Other Boards • Cue Health Inc. (2021-May 2024) • Affinia Therapeutics (private) • QuVa Pharma (private) Organizations • Board Member, PATH (non-profit organization focused on global health equity) • Board Member, SCAN (non-profit Medicare Advantage plan) Awards & Recognition • Awarded EY's Chairman's Value Award and Americas Assurance Inclusive Leadership Award in recognition of her commitment to building an inclusive workplace Education • Certified Public Accountant (CPA) • B.B.A., |
9
Former Chairman and Chief Executive Officer, Age: 69 Independent Director since 2016 Committees • Regulatory, Compliance and Cybersecurity Committee (Chair) • Compensation Committee • Strategic Advisory Committee Professional Experience • Former Chairman (2006-2015) and Chief Executive Officer (2005-2015), • Former President and COO, |
||
• Former President of Early Development Services, • Former Corporate Vice President and • Previously served in a variety of leadership roles at Key Skills & Qualifications • Healthcare Industry Expertise:over 35 years of healthcare industry experience, with comprehensive knowledge in pharmaceuticals gained through experience as CEO of • Management and Leadership Experience:previously served as CEO of • Public Company Board and Governance Experience:previously served as Chairman of the Board of • Corporate Strategy / M&A:previously served as Chairman of the Board of Other Boards • Covance Inc. (2005-2016) • Team Health Holdings Inc. (2013-2015) (Audit Committee member and Compensation Committee member) Organizations • Former Board Member, • Former Chairman, Education • B.S., |
10
Former Executive Vice President, CFO and COO, Age: 59 Independent Director since 2025 Committee • Strategic Advisory Committee Professional Experience • Former Executive Vice President, CFO and COO, (spun off from • Former Corporate Vice President and CFO, previously held various leadership roles in finance across multiple divisions since joining in 1989 |
||
Key Skills & Qualifications • Management and Leadership Experience:decades of executive and operational experience in the biopharmaceutical and medical device sectors, including as former Executive Vice President, CFO and COO of • Finance and Accounting: Certified Public Accountant (CPA) with extensive knowledge and experience in finance and accounting matters, with six years of public CFO service, having served as CFO of • Strategic Transformation:gained through experience as the former Corporate Vice President and CFO of • Corporate Strategy / M&A: led multiple M&A and other financial transactions common in healthcare at both the board- and management-level, including as the former CFO at • Operations: served as • Public Company Board and Governance Experience: service as Chair of the Audit Committee on public company boards includes Other Boards • Seaport Therapeutics (March 2025-Present) (Audit Committee Chair) (private) • BioMarin Pharmaceutical, Inc. (2017-Present) ( • Embecta Corporation (2022-Present) (Audit Committee Chair and • Aptinyx, Inc. (2018-2023) • CarMax, Inc. (2018-2022) • Naurex, Inc. (2012-2015) (private) • Surgical Innovation Associates, Inc. (2017-2022) (private) Organizations • Former Board Member, • Former President and Chairman of the Board, Education • CERT Certificate, Cyber-Risk Oversight, • M.B.A., NorthwesteUniversity (Finance & Management Strategy) • B.S., |
11
Former Chief Financial Officer, Age: 70 Independent Director since 2016 Committees • Audit Committee (Chair) • Regulatory, Compliance and Cybersecurity Committee Professional Experience • Former Chief Financial Officer, |
||
• Former Senior Vice President ( • Former Vice President (Investor Relations), • Previously held various leadership roles in sales, marketing, engineering, operations and strategic cost planning since joining Key Skills & Qualifications • Strategic Transformation: as the former Senior Vice President of • Management and Leadership Experience:previously held several executive positions at • Marketing / Brand Management:as the former Senior Vice President of • Operations / Logistics:with experience gained through a 37+ year career with • Finance and Accounting:as CFO of • Corporate Sustainability:led strategic sustainability efforts throughout his time as CFO at Other Boards • LocatorX (2020-present) (private) • NCR Corporation (2012-2020) (Audit Committee Chair) Organizations • Former Board Member, Education • Completed the Wharton Advanced Management Program ( • M.B.A., • Attended |
12
Lead Director, Age: 84 Independent Director since 2002 Lead Director since 2012 Committees • Nominating and Governance Committee (Chair) • Audit Committee Professional Experience • Lead Director, • Retired Chairman and CEO, |
||
• Former Vice Chairman, Managing Partner ( • Former Managing Partner ( Key Skills & Qualifications • Management and Leadership Experience:gained through service as the former Chairman and CEO of • Public Company Board and Governance Experience:previously served on several public company boards, including • Finance and Accounting:Certified Public Accountant (CPA) with extensive knowledge and exceptional skills in corporate finance and accounting matters, having served as Chairman and CEO of one of the largest public accounting firms in • Corporate Strategy / M&A:as the former Chairman and CEO of Other Boards • Covetrus, Inc. (2019-2022) (Independent Chairman and • General Motors Corporation (2009-2013) ( • Fannie Mae (2008-2014) (Chairman) • Lazard Ltd. (2008-2023) ( • Discover Financial Services (2007-2008) • Loews Corporation (2003-2023) (Audit Committee member) • Goodyear Tire & Rubber Co. (2001-2002) • The Progressive Corporation (2001-2007) • EY, LLP (1994-2001) Organizations • Former Board Member, • Former Chairman and Vice Chairman of the International Accounting Standards Committee Foundation • Former Member, 1999 Education • Certified Public Accountant (CPA) • B.A., |
13
Former Vice President and Chief Information Officer, Age: 69 Independent Director since 2018 Committees • Audit Committee • Regulatory, Compliance and Cybersecurity Committee Professional Experience • Former Vice President and Chief Information Officer, • Former Chief Information Officer, • Former Founding Executive Director, |
||
Key Skills & Qualifications • Technology Industry Leadership Experience: with information technology playing an increasingly important role in the Company's business, • Information Technology / Cybersecurity: as Vice President and University Chief Information Officer at • Public Company Board and Governance Experience: gained through experience as director and member of the • Public Sector / Government: as Assistant Secretary for Information Technology and CIO for the Other Boards • HarborOne Bancorp, Inc. (2022-Present) (Compensation Committee member and • Standard BioTools Inc. (f.k.a. Organizations • Member of the • Advisory Board member, • Member, • Advisory Board Member, Former Chair, BostonCIO (2015-2021) ( • Founding Chair of the • Former Member of the Massachusetts Technology Collaborative Board (quasi-state agency overseeing economic development in the Commonwealth) • Former Participant, Governor's Trade mission to • Former Founding Executive Director of Awards & Recognition • Recognized as the 2015 Boston CIO Leader of the Year by the • Named by • Awarded an Honorary Doctorate from the Universitat Politecnica de |
14
Education
• |
B.A., |
Former President and Chief Executive Officer of Age: 68 Independent Director since 2021 Committees • Strategic Advisory Committee • Regulatory, Compliance and Cybersecurity Committee Professional Experience • Former President and Chief Executive Officer, Association (1996-December 2020) • Former President and CEO, Rush Prudential Health Plans (1993-1996) • Former Vice President, • Former Founder, • Former Administrator, |
||
Key Skills & Qualifications • Healthcare Industry Expertise: considerable expertise in healthcare insurance and public policy gained through experience as President and CEO of • Management and Leadership Experience: gained through experience serving as President and CEO of • Public Sector / Government:previously served on the Other Boards • Board Member, • Theranica Bio-ElectronicsLtd. (2021-Present) (private) • Athletico Physical Therapy (2020-Present) (private) • Former Board Member, • Former Advisory Board Member, Paragon Biosciences (2024) (private) Organizations • Board Member, NorthwesteHealth Care Network • Chair of the • Advisory Board Member, • Advisory Board Member, Schaeffer Center at the • Former Executive Advisor, • Former CEO Advisory Board Member, Building a Healthier Chicago • Former Member of • Former Charter Member of the Awards & Recognition • Awarded an honorary Doctor of Science from Education • M.S., • B.S., |
15
Former Chief Executive Officer, Age: 68 Independent Director since 2010 Committees • Strategic Advisory Committee (Chair) • Compensation Committee • Nominating and Governance Committee Professional Experience • Former Chief Executive Officer, • Former President ( |
||
Key Skills & Qualifications • Healthcare Industry Expertise:as the former Chief Executive Officer of • Management and Leadership Experience:executive experience gained as CEO of • Marketing / Brand Management:significant marketing, sales, brand management and advertising experience gained through senior leadership experience at both • Public Company Board and Governance Experience:deep knowledge of corporate governance issues and risk management relating to public companies, as well as experience in succession planning, compensation, employee management and the evaluation of acquisition opportunities through service on multiple public company boards in healthcare and contract research, global manufacturing and automobile insurance organizations • Corporate Strategy / M&A:served as CEO of Other Boards • Honeywell International (2004-2018) (Retirement Plan Committee Chair and • The Progressive Corporation (2003-2018) ( • Covance Inc. (2009-2015) (Compensation Committee Chairman) • IMS Health Incorporated (2009-2010) (Compensation Committee member) Organizations • Former Chair, • Lay Elder, Awards & Recognition • Awarded Distinguished Agriculture Alumni Award and Honorary Doctor of Science from • Awarded Honorary Doctor of Science from • Featured on the cover of Education • A • Ph.D., • B.A., |
16
Managing Director of Age: 74 Independent Director since 2021 Committee • Strategic Advisory Committee Professional Experience • Managing Director of • Co-Founderand Convener, Black Coalition Against COVID-19 • Co-Founderand Board Chairman, • Former Executive Vice President and Chief of Medical Affairs, |
||
Key Skills & Qualifications • Management and Leadership Experience: considerable experience as EVP and Chief of Medical Affairs at • Healthcare Industry Expertise: 35 years of experience as recognized leader in the health care profession, with experience engaging with nearly every sector of the health and medical care industries • Public Sector / Government: member of numerous federal advisory committees and corporate, non-profitand academic boards, including service as Commissioner of Public Health for the • Public Company Board and Governance Experience: service on multiple public company boards in the healthcare industry Other Boards • Adverum Biotechnologies, Inc. (2021-Present) (private) • CTI BioPharma Corp (2011-2023) (Nominating and Governance Committee • Acasti Pharma, Inc. (2013-2016) • LifePoint Health, Inc. (2014-2018) • Baxter International, Inc. (1996-1998) Organizations • Advisory Board Member, • Board of Trustees Member, • Board Member, The • Former President, • Former Senior Vice President (Professional Standards), • Former Commissioner of Public Health, • Former Senior Vice President, • Former President, • Formerly appointed to various leadership roles, • Former Member of the • Former Member of numerous federal advisory committees and corporate, non-profitand academic boards Awards & Recognition • Recognized several times as one of the "50 Most Influential Physician Executives" by • Named as one of the "100 Most Powerful Executives in Corporate America" by • Named "Washingtonian of the Year" by • Author of "The Doctor in the Mirror," an ongoing book and online senior patient activation and education project Education • Completed the |
17
• |
M.D., |
• |
B.S., |
Each director will be elected by the vote of the majority of the votes cast with respect to that director's election, where a "majority of the votes cast" means that the number of shares voted "FOR" a director must exceed the number of votes cast "AGAINST" that director.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSED NOMINEES FOR DIRECTOR.
18
PROPOSAL 2
ELECTION OF MAX LIN TO THE BOARD OF DIRECTORS
In addition to the twelve persons named in Proposal 1, the Company's Board of Directors has approved the nomination of
Strategic Partnership Agreement with KKR
As previously disclosed by the Company, pursuant to the Strategic Partnership Agreement dated
Pursuant to the terms of the Strategic Partnership Agreement, it is expected that, if elected to the Board of Directors,
Conditions to Proposal 2
Set forth below is certain information, as of
Partner, Age: 43 Professional Experience • Partner, KKR (2005-2007, 2009-Present) • Analyst, Morgan Stanley (2003-2005) |
||
Key Skills & Qualifications • Healthcare Investor: relevant investment experience in numerous dental and medical companies, including 123 Dentist, • Finance and M&A: extensive knowledge in finance and transaction matters through his role as partner at KKR where he leads the Health Care industry team within the Americas Private Equity platform and serves as a member of the Investment |
19
Committee and • Governance Experience: serves on public and private boards, including at Other Boards • Cotiviti, Inc. (2024-Present) (private) • Therapy Brands Holdings, LLC (2021-Present) (private) • Heartland Dental, LLC (2018-March 2025) (private) • PetVet Care Centers, LLC (2018-Present) (private) • Envision Healthcare Corporation (2018-2023) (private) • BrightSpring Health Services, Inc. (2017-Present) (Compensation Committee Chair) • Covenant Physician Partners (2017-2024) (private) • Global Medical Response, Inc. (2015-Present) (private) • PRA Health Sciences, Inc. (2013-2019) • Biomet, Inc. (2011-2015) (private) Education • M.B.A., • B.S. and B.A.S., |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF MAX LIN FOR DIRECTOR.
20
PROPOSAL 3
ELECTION OF WILLIAM K. "DAN" DANIEL TO THE BOARD OF DIRECTORS
In addition to the twelve persons named in Proposal 1 and
Strategic Partnership Agreement with KKR
As previously disclosed by the Company, pursuant to the Strategic Partnership Agreement, the Board of Directors has agreed to nominate
Pursuant to the terms of the Strategic Partnership Agreement, it is expected that, if elected to the Board of Directors,
Conditions to Proposal 3
Set forth below is certain information, as of
Executive Advisor, Age: 60 Professional Experience • Executive Advisor (Americas Private Equity), KKR (2020-Present) • Former Executive Vice President, • Former Senior Vice President and President, Light Vehicle Aftermarket, (became merged) (1987-2006) |
||
Key Skills & Qualifications • Management and Leadership Experience:decades of global leadership experience in Healthcare and Industrial sectors, including 14 years as Executive Vice President at Danaher, where he oversaw multiple business segments and played a key role in advancing Danaher's business systems and culture; |
21
• Corporate Strategy / M&A:led strategies to drive operating performance and growth and to implement employee engagement models at KKR portfolio companies as an Executive Advisor to KKR; • Public Company Board and Governance Experience:served as a Director at Other Boards • CIRCOR (2023-Present) (Chairman) (private) • Therapy Brands (2021-Present) (Chairman) (private) • Fortifi Food Processing Solutions (2021-Present) (Chairman) (private) • Envista Holdings Corporation (2019-2020) Education • M.B.A., • B.A., |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF WILLIAM K. "DAN" DANIEL FOR DIRECTOR.
22
CORPORATE GOVERNANCE
Board of Directors Meetings and Committees
During the fiscal year ended
Independent Directors
The Board of Directors has affirmatively determined that Messrs. Ali, Daniel, Herring, Hombach, Kuehn, Laskawy, Lin and Serota, Mses. Derby, Faig, Margulies and Raphael and Drs. Sheares and Tuckson are "independent," as defined under Nasdaq's Rule 5605(a)(2).
The Company's independent directors, as defined under Nasdaq's Rule 5605(a)(2), meet at regularly scheduled executive sessions without members
Audit Committee
The Audit Committee currently consists of Messrs. Kuehn (Chairperson) and Laskawy and Mses. Faig and Margulies. All of the members of the Audit Committee are independent directors as defined under Nasdaq's Rules 5605(a)(2) and 5605(c)(2)(A). The Board of Directors has determined that each of
The purpose of the Audit Committee is to assist the Board of Directors by overseeing the Company's accounting and financial reporting processes and the audits and integrity of the Company's financial statements. In addition to overseeing those aspects of risk management and legal and regulatory compliance monitoring processes which may impact the Company's financial reporting (including financial accounting and reporting risks, as well as cybersecurity risks which may impact the Company's financial reporting), the Audit Committee reviews conflict of interest and related party transactions. The Audit Committee oversees (i) our accounting and financial reporting processes, (ii) our audits and (iii) the integrity of our financial statements on behalf of the Board of Directors, including the review of our consolidated financial statements and the adequacy of our internal controls. In fulfilling its responsibility, the Audit Committee has direct and sole responsibility, subject to stockholder approval, for the appointment, compensation, oversight and termination of the independent registered public accounting firm for the purpose of preparing or issuing an audit report or related work. The Audit Committee has the authority to retain, terminate and set the terms of its relationship with any outside advisors who assist the committee in carrying out its responsibilities. The Audit Committee meets at least four times each year and periodically meets separately with management, internal auditors and the independent registered public accounting firm to discuss the results of their audit or review of the Company's consolidated financial statements, their evaluation of our internal controls, the overall quality of the Company's financial reporting, our critical accounting policies and to review and approve any related party transactions (as defined by applicable regulations). We maintain procedures for the receipt, retention and the handling of complaints, which the Audit Committee established.
Compensation Committee
The Compensation Committee currently consists of
The purpose of the Compensation Committee is to evaluate and approve the Company's compensation and benefit plans, policies and programs. The Compensation Committee reviews and approves (i) all incentive and equity-based compensation plans in which officers, employees, directors or other service providers may participate, (ii) the Company's employee and executive benefits plans, and all related policies, programs and practices and (iii) arrangements with executive officers relating to their employment relationships with the Company, including, without limitation, employment agreements, severance agreements, supplemental pension or savings arrangements, change in control agreements and restrictive covenants. In addition, the Compensation Committee has overall
23
responsibility for evaluating and approving the Company's compensation and benefit plans, policies and programs. The Compensation Committee is also responsible, as delegated by the Board of Directors, for reviewing and approving the compensation philosophy, strategy, program design and administrative practices to align with and support the Company's operating and financial objectives and the financial interests of the Company's stockholders. The Compensation Committee also plays a role (in coordination with the
Use of
In making its determinations with respect to executive compensation, the Compensation Committee has historically engaged the services of an independent compensation consultant,
The Compensation Committee retains Pearl Meyer directly, and Pearl Meyer reports directly to the Compensation Committee. However, in carrying out its assignments and during the course of providing services to the Compensation Committee, Pearl Meyer may interact with Company management when necessary and appropriate in order to obtain relevant compensation and performance data for the executives and the Company. In addition, Pearl Meyer may seek input and feedback from Company management regarding Pearl Meyer's work product and analysis prior to presenting such information to the Compensation Committee in order to confirm Pearl Meyer's understanding of the Company's business strategy or identify data questions or other similar issues, if any.
The Compensation Committee, with the assistance and independent advice from Pearl Meyer, annually reviews competitive compensation data prepared by
The Compensation Committee has the authority to retain, terminate and set the terms of its relationship with any outside advisors who assist the committee in carrying out its responsibilities.
Nominating and Governance Committee
The purpose of the
24
nominees and each such nominee's consent to serve as a director if elected, no later than the deadline for submission of stockholder proposals. Our policy is to consider nominations to the Board of Directors from stockholders who comply with the procedures set forth in the Company's Fourth Amended and Restated By-lawsfor nominations at the Company's annual meeting of stockholders, and to consider such nominations using the same criteria it applies to evaluate nominees recommended by other sources. To date, we have not received any recommendations from stockholders requesting that the
In evaluating director nominees on an annual basis, the
• |
the knowledge, skills, reputation, background and experience of nominees, in light of prevailing business conditions and the knowledge, skills and experience already possessed by other members of the Board of Directors; |
• |
familiarity with businesses similar or analogous to the Company; |
• |
experience with accounting rules and practices, and corporate governance principles; |
• |
experience and expertise related to economic, environmental and human capital matters; and |
• |
the commitments of the director nominee to other board memberships, among other significant professional commitments that the director maintains. |
With the goal of increasing the effectiveness of the Board of Directors and its relationship to management, the
The purpose of the
25
Cybersecurity Committee that may impact the Company's financial reporting and (vi) be generally available to, and communicate with, the Company's senior management, and to inform the Board of Directors in the areas described above.
The purpose of the
Board of Directors' Leadership Structure
On an annual basis, as part of our governance review and succession planning, the
Since 1989, the Company has employed a traditional board leadership model, with our Chief Executive Officer also serving as Chairman of our Board of Directors. We believe this traditional leadership structure benefits our Company. A combined Chairman/CEO role helps provide strong, unified leadership for our management team and Board of Directors. Our customers, stockholders, suppliers and other business partners have always viewed our Chairman/CEO as a visionary leader in our industry, and we believe that having a single leader for the Company is good for our business.
We also believe that strong, independent
• |
presiding at all executive sessions of the independent directors and calling meetings of the independent directors; |
• |
acting as a liaison among the members of the Board of Directors, the Chief Executive Officer and management; |
• |
coordinating information sent to the Board of Directors; |
• |
coordinating meeting agendas and schedules for the Board of Directors to assure that there is sufficient time for discussion of all agenda items; |
• |
conferring with the Chief Executive Officer, as appropriate; and |
• |
being available for consultation with our stockholders, as appropriate. |
(See "Corporate Governance Guidelines" set forth below.)
At present, we believe that combining the roles of Chairman and Chief Executive Officer, together with an experienced Lead Director, is the best governance model for our Company and our stockholders.
Our Board of Directors' committees, each with a separate Chairperson, are the: Audit Committee; Compensation Committee; Nominating and Governance Committee;
Our directors bring a broad range of leadership experience to the boardroom and regularly contribute to the thoughtful discussion involved in effectively overseeing the business and affairs of the Company. The atmosphere of our Board of Directors is collegial, all members are well engaged in their responsibilities, and all members express their views and consider the opinions expressed by other directors. We do not believe that appointing an independent Chairman would improve the performance of the Board of Directors.
26
The Board of Directors is responsible for selecting the Chairman/CEO. The Chairman/CEO establishes the agenda for each meeting of the Board of Directors (in coordination with the Chairperson of the
Board of Directors' Role in Oversight of Risk
Risk oversight is provided by a combination of our full Board of Directors and by the Board of Directors' committees. As part of its oversight, our Board of Directors and its committees meet regularly to discuss the strategic direction and the issues and opportunities facing our Company.
The Audit Committee takes the lead risk oversight role, focusing primarily on risk management related to monitoring and controlling the Company's financial risks (i.e., overseeing those aspects of risk management and legal and regulatory compliance monitoring processes which may impact the Company's financial reporting, including financial accounting and reporting risks, as well as cybersecurity risks). The Compensation Committee focuses primarily on human capital matters (such as executive compensation plans and executive agreements) and evaluates whether the Company's compensation policies and practices for its executive officers and other employees of the Company create risks that are reasonably likely to have a material adverse effect on the Company.
In
The Company's Executive Management Committee is responsible for the oversight and active management of material risks to the Company (including, without limitation, strategic, development, business, operational, human, sustainability, financial, technology, legal and regulatory risks) as an integral part of the Company's business planning, succession planning and management processes. Members of the management team provide periodic reports to the
The Company's management has a longstanding commitment to employing and imbedding sound risk management practices and disciplines into its business planning and management processes throughout the Company to better enable achievement of the Company's strategic, business, operational, financial, sustainability and compliance objectives, as well as to achieve and maintain a competitive advantage in the marketplace.
Human Capital Matters
At
• |
continuing to evaluate our pay equity for the majority of the |
• |
expanding our inclusive culture learning journey by educating TSMs on how to create and sustain a meaningful, inclusive and learning oriented culture; and |
• |
continuing to drive a culture of wellness and engagement for our TSMs by fostering an environment where they can feel a sense of belonging and purpose. |
Our employees continue to be one of our greatest assets. We employ approximately 25,000 people, with approximately 49% of our workforce based in
27
Our TSMs are the cornerstone of the Company. We provide a connected and caring community that invests in the career journey of our TSMs and encourages their contribution to our mission of making the world healthier. Our TSM experience strategy is centered around our Team Schein Values under the pillars of Community, Caring and Career. We know our business success is built on the engagement and commitment of our team, which is dedicated to meeting the needs of their fellow TSMs, our customers, supplier partners, stockholders and society.
We recognize the changes in how and where we work, and that a continued connection to our long-standing values is important for our team members as we evolve our culture. Throughout 2024, we rolled out a continuous listening program that used various vehicles, including
• |
Community:Provide opportunities for TSMs to have fun while contributing to an inclusive team that respects and supports one another. |
Ø |
Continued focus on creating an inclusive environment where TSMs feel a sense of belonging; notably, in 2024 for the third time, our top strength identified in |
Ø |
Completed our first year of |
Ø |
Expanded the number of "Connection Days" throughout the globe at |
Ø |
Continued focus on our Employee Resource Groups ("ERGs"), a vehicle for all TSMs to share, connect, leaand develop both personally and professionally. In 2024, we launched our seventh ERG, ADAPT (Abled and Disabled Allies Partnering Together). Each of our ERGs has a sponsor from our Executive Management Committee and Board of Directors. Our CEO engages directly in many of our ERG programs. |
Ø |
Certified over 200 TSMs through our Culture Ambassador Program, which educates TSMs on our culture and certifies TSMs as mentors to new hires during their first 90 days to ensure new TSMs understand how we live our values day to day, and how they can engage in the Team Schein Culture. |
• |
Caring:Build a world we want to live in by supporting each other and the communities in which we live and work. |
Ø |
Continued to offer a variety of opportunities to volunteer to drive purpose and engage in local communities in which TSMs live and work, such as through Carry the Load, the We Care Global Challenge, Back to School and Holiday Cheer. |
Ø |
Continued to strengthen our strategic partnerships with industry associations, customers and suppliers that support access to quality health care through various key programs and initiatives (e.g., Gives Kids A Smile, Cares Package Program, Global Student Outreach Program and Prepare to Care). |
Ø |
Expanded our global and highly rated Steps for Suicide Prevention campaign, which brings TSMs together to walk for a cause and provide education, partnering with the |
Ø |
We also understand the importance of driving a culture of wellness for our own team members through our Mental Wellness Committee, which is supported by our CEO, Executive Management Committee and Board of Directors. In 2024, we rolled out a 'Banish Burnout' campaign, partnering with an external wellness professional to create individualized tips and programming based on the burnout tendencies each TSM faces. |
28
• |
Career:Provide opportunities for TSMs to develop personally and professionally with an emphasis on embodying our values to achieve our collective goals with excellence and integrity. |
Ø |
Continued investment in our Team Schein Members by providing both formal and informal learning opportunities focused on growing and enhancing knowledge, skills and abilities through a broad suite of professional development training programs for current and future roles. In 2024, we saw an increase in participation in our workshops, with TSMs reporting a high utilization of skills learned. |
Ø |
Continued expansion of our leadership development programs, with formal mentorship and coaching programs. |
Ø |
Continued roll-outof talent planning efforts designed to ensure a strong leadership pipeline across the organization by strategically identifying and developing talent through targeted development opportunities and intentional succession plans. Information derived from talent planning efforts informs curriculum design and content to help focus on the right capabilities and help ensure alignment of career development efforts with the future needs of the organization. Our Board of Directors is provided with periodic updates regarding our talent and succession planning efforts and participates in professional development activities with our TSMs. |
Ø |
Announced the creation of the Core Leadership Capabilities ("CLCs"), a skills-based model for all TSMs that highlights the leadership capabilities that all TSMs are expected to demonstrate for career success. The CLCs are a common language and foundational step to developing and refining the tools, processes and programs which support the evolution of a TSM's career including enhancing skills and career development, leading to enhanced career pathing and internal mobility. |
Ø |
|
Corporate Governance Guidelines
The Board of Directors has adopted Corporate Governance Guidelines, a copy of which is available on our Internet website at www.henryschein.com, under the "Our Company-Corporate Governance Highlights" caption. Our Corporate Governance Guidelines address topics such as (i) role of the Board of Directors, (ii) director responsibilities, (iii) Board of Directors' composition, (iv) definition of independence, (v) lead director, (vi) committees, (vii) selection of Board of Directors nominees, (viii) orientation and continuing education of directors, (ix) executive sessions of independent directors, (x) management development and succession planning, (xi) Board of Directors' compensation, (xii) attendance of directors at the annual meeting of stockholders, (xiii) service on other boards, (xiv) Board of Directors access to management and independent advisors, (xv) annual evaluation of Board of Directors and committees, (xvi) submission of director resignations and (xvii) communications with the Board of Directors.
Among other things, the Company's Corporate Governance Guidelines provide that it is the Board of Directors' policy to periodically review issues related to the selection and performance of the Chief Executive Officer. At least annually, the Chief Executive Officer must report to the Board of Directors on the Company's program for management development and on succession planning. In addition, the Board of Directors and Chief Executive Officer shall periodically discuss the Chief Executive Officer's recommendations as to a successor in the event of the sudden resignation, retirement or disability of the Chief Executive Officer.
The Company's Corporate Governance Guidelines also provide that it is the Board of Directors' policy that, in light of the increased demands facing directors, directors must be able to devote sufficient time to carrying out their duties and responsibilities effectively. The Board believes that directors should limit the number of boards of other public companies on which its members serve to ensure their effectiveness as a member of the Company's Board. In
29
, under the "Our Company-Corporate Governance Highlights" caption. We will disclose on our website any amendment to, or waiver of, a provision of the Code of Ethics for Senior Financial Officers, or persons performing similar functions.
information, and, among other things, requires that designated individuals holding certain positions only transact in Company securities during an open window period (with appropriate preclearance for members of our Executive Management Committee (including all executive officers) and Board of Directors), subject to limited exceptions. The Company also requires periodic training for certain senior officers and others likely to leamaterial,
information in the course of their job duties. The Company also has a practice that requires that any transactions by the Company in its securities are
by appropriate members of its General Counsel's office.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table presents certain information regarding beneficial ownership of our common stock (excluding unvested restricted stock units and unvested stock options that are exercisable more than 60 days from
Shares Beneficially Owned |
||||||
Names and Addresses1 |
Number | Percent of Class |
||||
|
10,917 | * | ||||
|
616,877 | 0.50% | ||||
|
207,674 | * | ||||
|
0 | * | ||||
|
10,432 | * | ||||
|
62,110 | * | ||||
|
2,604 | * | ||||
|
24,904 | * | ||||
|
0 | * | ||||
|
12,843 | * | ||||
|
59,824 | * | ||||
|
0 | * | ||||
|
25,162 | * | ||||
|
68,534 | * | ||||
|
31,319 | * | ||||
|
6,369 | * | ||||
|
42,202 | * | ||||
Ronald N. South16 |
31,098 | * | ||||
|
7,586 | * | ||||
|
15,171,464 | 12.38% | ||||
|
12,016,714 | 9.81% | ||||
|
9,939,960 | 8.11% | ||||
|
6,546,018 | 5.34% | ||||
Directors and Executive Officers as a Group (21 persons)22 |
1,326,876 | 1.08% |
* Represents less than 0.50%.
1 Unless otherwise indicated, the address for each person is c/o
2 Represents (i) 9,654 shares owned directly and over which
3 Represents (i) 17,389 shares that
31
4 Represents (i) 153,220 shares owned directly and over which
5 Represents (i) 760 shares held indirectly by the
6 Represents (i) 18,403 shares owned directly and over which
7 Represents 2,604 restricted stock units that vested but, per
8 Represents 24,904 shares owned directly and over which
9 Represents (i) 1,000 shares owned directly and over which
10 Represents (i) 37,863 shares held in
11 Represents (i) 12,815 shares owned directly and over which
12 Represents (i) 8,952 shares owned directly and over which
13 Represents 31,319 shares owned directly and over which
14 Represents (i) 5,369 shares owned directly and over which
15 Represents (i) 5,369 shares owned directly and over which
16 Represents (i) 12,475 shares owned directly and over which Mr. South has sole voting and dispositive power and (ii) outstanding options to purchase 18,623 shares that either are exercisable or will become exercisable within 60 days of
17 Represents (i) 5,369 shares owned directly and over which
18 The principal office of
19 The principal business address of each of the entities and persons identified below, except
32
founding partner relationship, as applicable, but each disclaims beneficial ownership of such shares. The foregoing information regarding the stock holdings of KKR is as of
20 The principal office of
21 The principal office of
22 Includes (i) with respect to all directors and Named Executive Officers, (a) 784,575 shares, directly or indirectly, beneficially owned, (b) outstanding options to purchase 285,241 shares that either are exercisable or will become exercisable within 60 days of
33
COMPENSATION DISCUSSION AND ANALYSIS
Executive Summary
Completion of our 2022-2024 BOLD+1 Strategic Plan
In fiscal 2024, we continued to make progress on our recently completed 2022-2024 BOLD+1 Strategic Plan, including exceeding our 2024 target of generating 40% of our worldwide operating income from high-growth, high-margin businesses. BOLD+1 has become the foundation of our transformation into a more agile, customer-centric, digital, and efficient company, leveraging synergies across our complementary businesses. Our 2022-2024 BOLD+1 Strategic Plan consisted of the following:
• |
Build ("B") Complementary software, specialty, and services businesses for high growth |
• |
Operationalize ("O")One Distribution to deliver exceptional customer experience, increased efficiency, and growth |
• |
Leverage ("L")One Schein to broaden and deepen relationships with our customers |
• |
Drive ("D")Digital transformation for our customers and for |
• |
+1 Create Value for our stakeholders |
The Company's executive officer compensation program is designed to, among other things, align rewards with the achievement of the Company's strategic plan. For each year of the strategic plan, a percentage (30% for fiscal 2024) of the target of our annual cash bonus plan for all Executive Management Committee members (which include our Named Executive Officers), is based on the achievement of the financial goals and performance objectives set forth in the Company's strategic scorecard which goals directly reflect the priorities of the Company's 2022-2024 BOLD+1 Strategic Plan. We look forward to advancing the opportunities contained in our updated 2025-2027 BOLD+1 Strategic Plan and to continue to tie a significant portion of our annual cash bonus compensation to directly reflect those strategic priorities. In particular, we are focused on continuing to grow our
Executive Compensation Program Changes made in Fiscal 2024
As part of the annual review process of our executive compensation program and after considering stockholder perspectives shared with us during engagement meetings and benchmarking analyses, the Compensation Committee reviewed the performance objectives of the Company's annual cash bonus plan (i.e., the Henry Schein Incentive Plan ("HSIP"), formerly known as the Performance Incentive Plan) and the Company's equity compensation program (i.e., the Long Term Incentive Program under the 2024 Stock Incentive Plan as defined below ("LTIP")) and approved certain refinements to our executive compensation program design that became effective starting with fiscal 2024 and maintained certain other provisions.
• |
Replaced non-financialmetrics in favor of financial metrics:The Compensation Committee updated the Company's strategic scorecard goals (which goals directly reflect the priorities of the Company's then current three-year strategic plan and which make up 30% of the 2024 HSIP bonus for each Named Executive Officer) to remove all non-financialmetrics (except for a performance objective tied to the launch of our new global e-commerceplatform) and streamline the financial metrics. |
• |
Maintained at least 50% of all equity grants to Named Executive Officers as PSUs (65% for CEO): Awards under the 2024 LTIP for our CEO consisting of 65% performance-based restricted stock units ("PSUs") and 35% time-based restricted stock units ("RSUs") and our Named Executive Officers (other than our CEO) consisting of 50% PSUs and 50% RSUs. |
• |
Base Salary:The fiscal 2024 base salaries for Messrs. Bergman and Breslawski increased by 4%, in line with the average merit increase for our |
• |
2024 HSIP:The fiscal 2024 target bonuses under the HSIP for all Named Executive Officers (other than Messrs. South and Ettinger) increased by 4%. Based on market adjustments following a benchmarking analysis of our peer companies, the fiscal 2024 HSIP target bonus for Messrs. South and Ettinger increased by 10% and 16.5%, respectively. Based on a benchmarking analysis of our peer companies, the maximum payout for the Company Financial/EPS component of the HSIP was increased from 150% to 200%. |
• |
2024 LTIP:The grant date fair value of the 2024 LTIP awards for Messrs. Bergman and Breslawski increased by 5%. Based on market adjustments following a benchmarking analysis of our peer companies, the grant date fair value of the 2024 LTIP awards for Messrs. South, Mlotek and Ettinger increased by 11.1%, 7% and 14.3%, respectively. |
34
We believe these compensation program designs and decisions reflect preferences of our stockholders and are aligned with best market practices.
Components of the Executive Compensation Program
The Company's executive compensation program consists of four main components: (i) base salary; (ii) annual incentive compensation opportunity; (iii) long-term equity-based awards and (iv) benefits and perquisites. As described below, annual and long-term performance-based awards represent a major portion of total compensation for the Named Executive Officers. The combination of these four components of our executive compensation program is designed to balance Company annual operating objectives and earnings performance with longer-term Company stockholder value creation goals.
A major portion of total compensation for our Named Executive Officers is placed at risk through annual and long-term incentives tied to the achievement of performance metrics and/or stock appreciation. In fiscal 2024, the sum of annual incentive compensation (under the heading "Non-EquityIncentive Plan Compensation"), PSUs (based on target achievement) and RSUs represented (i) 82% of the total compensation for our CEO and (ii) between 67% and 77% of the total compensation for the Named Executive Officers (other than our CEO). We seek to provide competitive compensation that is commensurate with performance. We generally target compensation at the median of the market and calibrate both annual and long-term incentive opportunities to generate less-than-median awards when goals are not fully achieved and greater-than-median awards when goals are exceeded. (See "Pay Levels and Benchmarking" set forth below.)
Base Salary. The Compensation Committee annually reviews and approves base salary for the Named Executive Officers.
Annual Incentive Compensation. The components of the Company's annual incentive compensation (i.e.,bonuses under the HSIP) are set by the Compensation Committee annually and are designed to reward the achievement of pre-establishedperformance goals.
Each executive officer's annual incentive compensation under the HSIP (other than
• |
the Company's corporate financial (i.e., EPS) goal (subject to the adjustments as described herein); |
• |
the executive officer's specific business unit financial goals and individual performance goals; and |
• |
financial goals and performance objectives set forth in the Company's strategic scorecard, which goals are directly tied to the Company achieving its then-current three-year strategic plan. |
• |
the Company's corporate financial (i.e., EPS) goal (subject to the adjustments as described herein); and |
• |
financial goals and performance objectives set forth in the Company's strategic scorecard which goals are directly tied to the Company achieving its then-current three-year strategic plan. |
Long-Term Equity-Based Awards. The Compensation Committee approved equity-based awards for fiscal 2024 ("2024 LTIP") under the Company's Long Term Incentive Program under the
• |
In fiscal 2024, our CEO received 65% PSUs and 35% RSUs and our other Named Executive Officers received 50% PSUs and 50% RSUs; and |
• |
PSUs granted in fiscal 2024 to participants, including the Named Executive Officers, are tied to the Company's (i) EPS performance over the three-year performance period (weighted at 75% of the total PSU award) and (ii) retuon invested capital performance over the three-year performance period (weighted at 25% of the total PSU award), in each case subject to any potential required adjustments as described below. When the Company successfully achieves its three-year cumulative EPS goal ("EPS goal") and its three-year average retuon invested capital goal ("ROIC goal"), participants, including the Named Executive Officers, are paid shares under their PSUs at target levels. When the Company's performance exceeds the EPS goal and/or the ROIC goal, participants, including the Named Executive Officers, receive additional shares under their PSUs (with respect to the applicable weighted component of the PSU that exceeded the goal) up to a 200% maximum payout. When the |
35
Company's performance does not meet the EPS goal and/or the ROIC goal, shares paid to participants (including the Named Executive Officers) under their PSUs (with respect to the applicable weighted component of the PSU that did not meet the goal) are reduced or eliminated. |
Benefits and Perquisites. The Company provides a program commensurate with competitive practices that is generally consistent with the benefits provided to other employees. The Company does not provide any tax gross-upsto our Named Executive Officers (other than for relocation expenses). See "Compensation Structure-Pay Elements-Details-Benefits and Perquisites" set forth below.
Compensation Objectives and Strategy
The Company's executive officer compensation program is designed to attract and retain the caliber of officers needed to ensure the Company's continued growth and profitability, and to reward them for their performance, the Company's performance and for creating long-term value for stockholders. The primary objectives of the program are to:
• |
align rewards with the achievement of performance that enhances stockholder value; |
• |
align rewards with the achievement of the Company's strategic plan; |
• |
support the Company's strong team-based orientation; |
• |
encourage high-potential team players to build a career at the Company; and |
• |
provide rewards that are cost-efficient, competitive with other organizations and fair to employees and stockholders. |
The Company's executive compensation programs are approved and administered by the Compensation Committee of the Board of Directors. Working with management and outside advisors, the Compensation Committee has developed a compensation and benefits strategy that rewards performance (including, without limitation, achievement of the Company's strategic plan), promotes appropriate conduct and reinforces a culture that the Compensation Committee believes will continue to drive long-term success for the Company, thereby enhancing stockholder value. The compensation program rewards team accomplishments while, at the same time, promoting individual accountability. The Company has a planning and goal-setting process that is fully integrated into the compensation system, intended to result in a strong relationship between individual efforts, business unit financial results, Company financial results, and the Company's achievement of its strategic plan with executive officer financial rewards.
We seek to promote a long-term commitment to the Company by our senior executives. We believe that there is great value to the Company in having a team of long-tenured, seasoned managers to enable us to capitalize on our growth strategies. Our team-focused culture and management processes are designed to foster this commitment. The vesting schedules attached to LTIP awards (three-year cliff vesting for PSUs and four-year cliff vesting for RSUs) reinforce this long-term orientation.
Role of the Compensation Committee
General
The Compensation Committee provides overall guidance for our executive compensation policies and determines the amounts and elements of compensation for our executive officers, including the Named Executive Officers. The Compensation Committee's function is more fully described in its charter which has been approved by our Board of Directors and is available on our Internet website at www.henryschein.com, under the "Our Company-Corporate Governance Highlights" caption.
When considering decisions concerning the compensation of the Named Executive Officers (other than the Chief Executive Officer), the Compensation Committee asks for recommendations from
Use of
In making its determinations with respect to executive compensation, the Compensation Committee has historically engaged the services of an independent compensation consultant, Pearl Meyer. Pearl Meyer has also assisted the Compensation Committee with several special projects, including advice on director compensation. Other than the work of
36
which the Compensation Committee concluded did not change its independence determination regarding Pearl Meyer, Pearl Meyer does no other work for the Company.
The Compensation Committee retains Pearl Meyer directly, and Pearl Meyer reports directly to the Compensation Committee. However, in carrying out its assignments and during the course of providing services to the Compensation Committee, Pearl Meyer may interact with Company management when necessary and appropriate in order to obtain relevant compensation and performance data for the executives and the Company. In addition, Pearl Meyer may seek input and feedback from Company management regarding Pearl Meyer's work product and analysis prior to presenting such information to the Compensation Committee in order to confirm Pearl Meyer's understanding of the Company's business strategy or identify data questions or other similar issues, if any.
The Compensation Committee, with the assistance and independent advice from Pearl Meyer, annually reviews competitive compensation data prepared by
The Compensation Committee has the authority to retain, terminate and set the terms of its relationship with any outside advisors who assist the committee in carrying out its responsibilities.
Say-on-PayVotes and Stockholder Feedback
The Company provides its stockholders with the opportunity to cast an annual advisory vote on the Company's most recently completed fiscal year's executive compensation (such proposal, the "say-on-payproposal"). At the Company's 2024 Annual Meeting, 87.8% of the votes cast on the say-on-payproposal at the meeting were in favor of the say-on-payproposal. The Compensation Committee evaluated this result and, after consideration, concluded that the voting result reflects our stockholders' continued support of the Company's approach to executive compensation.
In 2024 and into early 2025, we continued to have dialogues with stockholders focused on a range of topics including executive compensation, corporate governance, and sustainability initiatives. We offered engagement to 34 stockholders holding approximately 67% of our outstanding common stock in the aggregate (as of the date of offer) and engaged with 26 stockholders holding a total of approximately 56% of our outstanding common stock in the aggregate (as of the date of engagement). Such engagement was led by
As noted in the Executive Summary, as part of the annual review process of our executive compensation program and after considering stockholder perspectives shared with us during engagement meetings and benchmarking analyses, the Compensation Committee approved certain refinements to our executive compensation program design that became effective starting with fiscal 2024 and maintained certain other provisions. In addition, in
• |
Replaced non-financialmetrics in favor of financial metrics:Stockholders expressed their desire for executive officers' annual cash bonus plan (the HSIP) performance metrics to be tied to financial metrics as opposed to non-financialgoals. The Compensation Committee updated the Company's strategic scorecard goals (which goals directly reflect the priorities of the Company's then current three-year strategic plan and which make up 30% of the 2024 HSIP bonus for each Named Executive Officer) to remove all non-financialmetrics (except for a performance objective tied to the launch of our new global e-commerceplatform) and streamline the financial metrics. |
• |
Maintained at least 50% of all equity grants to Named Executive Officers as PSUs (65% for CEO): Awards under the 2024 LTIP for our CEO consisted of 65% PSUs and 35% RSUs and for our Named Executive Officers (other than our CEO) consisted of 50% PSUs and 50% RSUs. |
• |
0% Payout of PSUs in |
37
We believe these compensation program designs and decisions reflect preferences of our stockholders and are aligned with best market practices. We greatly appreciate the valuable perspectives our stockholders have shared and are committed to continuing the dialogue. The Compensation Committee will continue to consider the outcome of the Company's say-on-payproposals and stockholder discussions and perspectives when making future compensation decisions.
Compensation Structure
Pay Element-Overview
The Company utilizes four main components of compensation:
• |
Base Salary-fixed pay that takes into account an individual's role and responsibilities, experience, expertise and individual performance; |
• |
Annual IncentiveCompensation-variable pay that is designed to reward attainment of annual business goals, with payout of target award goals generally expressed as a percentage of base salary; |
• |
Long-Term Equity-Based Awards-stock-based awards including PSUs and RSUs; and |
• |
Benefits and Perquisites-includes medical, dental, life, disability and business travel insurance benefits, retirement savings and, in the case of |
Pay Elements-Details
Base Salary
The Compensation Committee annually reviews executive officer salaries and makes adjustments, as warranted, based on individual responsibilities and performance, Company performance in light of market conditions and competitive practice and benchmarking analyses of our peer companies. Salary adjustments are generally approved and implemented during the first quarter of the calendar year (typically in March). In
Annual Incentive Compensation
Annual incentive compensation for each of the Company's executive officers is determined and paid under the Henry Schein Incentive Plan for such year. In
Components of the HSIP
The components of the HSIP are designed to reward the achievement of pre-establishedcorporate financial, business unit financial/ individual performance goals and the Company's strategic scorecard goals. The Compensation Committee sets the HSIP's performance goals and target payout for the Chief Executive Officer. With respect to the executive officers (other than the Chief Executive Officer), at the beginning of each year, the Chief Executive Officer recommends to the Compensation Committee which executive officers should participate in the HSIP for that year and, following review and approval by the Compensation Committee, such officers are notified of their participation. The Chief Executive Officer recommends to the Compensation Committee the HSIP's performance goals and target payout for executive officers (other than himself), subject to the Compensation Committee's review and approval.
HSIP targets and goals for fiscal 2024 for the Named Executive Officers were established at the beginning of fiscal 2024. For the Named Executive Officers (other than
• |
the Company's 2024 EPS measured against pre-establishedstandards, as may be adjusted pursuant to the terms of the 2024 HSIP (the "2024 Company Financial/EPS Goal"), subject to the adjustments as described herein; |
38
• |
achievement of financial goals in their respective business units and individual performance objectives ("Business Financial/Individual Goals"), subject to the adjustments as described herein; and |
• |
achievement of the financial goals (and one performance objective) set forth in the Company's strategic scorecard ("Strategic Scorecard Goals") which directly reflect the priorities of the Company's then current three-year strategic plan. |
The weight (expressed as a percentage of the HSIP target payout) for each component of the 2024 HSIP awards for the Named Executive Officers (other than
2024 Company Financial/EPS Goal
In
The Compensation Committee sets the goals for HSIP awards such that incentive compensation is paid at less-than-median of the market awards when Company Financial/EPS Goals are not fully achieved and greater-than-median awards when goal(s) are exceeded. Following a benchmarking analysis of our peer companies, in
Under the 2024 HSIP, the Compensation Committee may adjust the 2024 Company Financial/EPS Goal and Business Financial/Individual Goals for the following factors (which factors were pre-establishedby the Compensation Committee in the first quarter of 2024):
• |
acquisitions, dispositions and new business ventures (based on the approved model pre-establishedin writing) not initially considered when developing the HSIP goal, including: |
Ø |
the effect of accretion or dilution relating to unbudgeted acquisitions (or dispositions) but only for the first 12 months following the transaction (or shorter time period, if applicable), and any variance from the acquisition model originating from differences in acquisition accounting adjustments (e.g., assets step ups or other fair value adjustments) are to be excluded; |
Ø |
any gain, loss or expense related to the disposal of a business or discontinued operations that was not previously considered when developing the HSIP goal; |
Ø |
unbudgeted acquisition and professional fees and expenses related to closed acquisitions or dispositions incurred in the year of the acquisition or disposition, but only for that year; and |
Ø |
unbudgeted acquisition and professional fees and expenses relating to individual unclosed acquisitions or dispositions, where such fees and expenses exceed |
• |
capital transactions (including capital stock repurchases) to the extent the adjustment was not already contemplated in the HSIP goal; |
• |
other differences in budgeted average outstanding shares (other than those resulting from capital transactions referred to above); |
• |
the financial impact, either positive or negative, of the changes in foreign exchange rates from the rates used in setting the budgeted EPS goal for the fiscal year; and |
• |
the actual financial impact of the following matters to the extent the related activity was not already contemplated in the goal: |
Ø |
restructuring costs incurred related to publicly announced restructuring plans and separately identified in the Company's periodic filings, |
Ø |
amortization expense recorded for acquisition-related intangible assets; |
39
Ø |
any impairment charges for acquisition intangibles or goodwill separately identified in the Company's periodic filings; |
Ø |
any judgments, settlements or other payments, each exceeding |
Ø |
the impact of any increase or decrease in tax rates in any country in which the Company derives greater than 5% of its net income; |
Ø |
changes in accounting principles or in applicable laws or regulations; and |
Ø |
unforeseen events or circumstances affecting the Company. |
Additionally, the Compensation Committee may further adjust the goal for any other unforeseen event or other facts and circumstances beyond the control of the Company, by an amount equal to a reasonable estimate of the expected accretion or dilution, based on information provided to them by executive management. In the event the Compensation Committee makes adjustments in accordance with the preceding sentence, the Compensation Committee in its sole discretion will determine the HSIP award payouts that correspond to the levels of achievement of the adjusted goal. The Compensation Committee may award all or a portion of a HSIP award upon the attainment of any goals (including the applicable predefined goals). The Compensation Committee or the Chief Executive Officer (solely with respect to non-executiveofficers) may also grant discretionary awards under the HSIP.
Business Financial/Individual Goals and Strategic Scorecard Goals for Named Executive Officers (other than the CEO)
Business Financial/Individual Goals vary for each Named Executive Officer as the goals reflect each executive's specific role and function. Strategic Scorecard Goals are the same for all Named Executive Officers and are tied to the advancing of the Company's then current three-year strategic goals. Financial measures included in such goals are adjusted in a manner similar to adjustments made to the 2024 Company Financial/EPS Goal (as described above).
Business Financial/Individual Goals are designed to motivate executive officers to achieve challenging, but attainable goals for talented executives. Strategic Scorecard Goals are designed to motivate executive officers to achieve the Company's challenging, but attainable then current three-year strategic plan. The Compensation Committee sets the goals for HSIP awards such that incentive compensation is paid at less-than-median of the market awards when Business Financial/Individual Goals or Strategic Scorecard Goals are not fully achieved and greater-than-median awards when goal(s) are exceeded. The maximum payout percentage under the HSIP for the Named Executive Officers ranges from 115% to 200% for the Business Financial/Individual Goals (depending on the specific category of goal applicable to such Named Executive Officer). With respect to the Strategic Scorecard Goals, the maximum percentage payout is 115%.
For each Named Executive Officer (other than
• |
Mr. South: (i) achievement against the expense budget for the Company's |
• |
|
• |
|
• |
|
The Strategic Scorecard Goals for each Named Executive Officer (including
40
goals. On
process to adjust the goal and to approve the adjustments that were applied to the actual results, in each case, based on the
adjustments authorized under the HSIP. For the 2024 HSIP, adjustments to the 2024 Company Financial/EPS Goal included the effects during fiscal 2024 of the impact of acquisitions (including minority interests), certain capital transactions (including capital stock repurchases) and changes in foreign exchange rates. As a result, the Compensation Committee approved an adjustment to increase the 2024 Company Financial/EPS Goal to
diluted EPS, adjusted for restructuring costs, amortization of acquisition intangibles, impairment of intangible assets, litigation settlements, impairment of capitalized assets, insurance proceeds and
costs related to the
EPS used for the purposes of the HSIP achievement calculation was
diluted EPS adjusted to exclude certain items not previously approved by the Compensation Committee in the 2024 HSIP Plan, including impairment of capitalized assets, gain resulting from the purchase of a controlling interest of a previously held
equity investment, costs associated with shareholder advisory matters, insurance proceeds and
costs related to the
Incentive Plan Compensation."
• |
achievement of the 2024 Company Financial/EPS Goal, subject to the adjustments as described herein (weighted at 70% of his total award); and
|
• |
the Company's Strategic Scorecard Goals (weighted at 30% of his total award).
|
Incentive Plan Compensation."
of employees or other restrictive covenant between the participant and the Company on or after the payment date, but on or prior to the first anniversary of the payment date. In addition, the Company adopted the Dodd-Frank Policy (defined below under "
• |
PSUs; and
|
• |
RSUs.
|
or accelerated vesting upon certain qualifying terminations such as retirement, death or disability, or termination without cause following a change in control (as defined in the 2024 Stock Incentive Plan)).
, PSUs or RSUs) or stock options upon a change in control. Instead, in connection with a change in control, all outstanding restricted stock units and unvested stock options granted to our executive officers vest automatically upon a participant's termination of employment by the Company without cause or by the participant for good reason (and for
of employees or other
date following approval by the Compensation Committee.
by the Compensation Committee in the first quarter of 2024):
• |
acquisitions, dispositions and new business ventures (based on the approved model
pre-established
in writing) not initially considered when developing the goal including: |
Ø
|
the effect of accretion or dilution relating to unbudgeted acquisitions (or dispositions), but only for the first 12 months following the transaction (or shorter time period, if applicable), with any variance from the acquisition model originating from differences in acquisition accounting adjustments (
e.g.
, assets step ups or other fair value adjustments), are to be excluded; |
Ø |
any gain, loss or expense related to the disposal of a business or discontinued operations that was not previously considered when developing the goal; |
Ø |
unbudgeted acquisition and professional fees and expenses related to closed acquisitions or dispositions incurred in the year of the acquisition or disposition, but only for that year; and |
Ø |
unbudgeted acquisition expenses and professional fees relating to individual unclosed acquisitions or dispositions, where such fees and expenses exceed |
• |
capital transactions (including capital stock repurchases), to the extent the adjustment was not already contemplated in the goal; |
• |
other differences in budgeted average outstanding shares (other than those resulting from capital transactions referred to above); |
• |
the financial impact, either positive or negative, of the changes in foreign exchange rates from the rates used in setting the three-year performance goal; and |
• |
the actual financial impact of the following matters to the extent the related activity was not already contemplated in the goal: |
Ø |
restructuring costs incurred related to publicly announced restructuring plans and separately identified in the Company's periodic filings; |
Ø |
amortization expense recorded for acquisition-related intangible assets; |
Ø |
any impairment charges for acquisition intangibles or goodwill separately identified in the Company's periodic filings, |
Ø |
any judgments, settlements, or other payments, each exceeding |
Ø |
the impact of any increase or decrease in tax rates in any country in which the Company derives greater than 5% of its net income; and |
Ø |
changes in accounting principles or in applicable laws or regulations. |
During the first quarter of each calendar year in which the Company issues PSUs, the Compensation Committee (i) sets the target goal(s) designed to result in a payout equal to 100% under the PSUs to be granted during such year and (ii) approves the required adjustments to be made under the respective awards. For the 2022 LTIP, the target goal was a three-year cumulative EPS goal. For the 2023 LTIP and 2024 LTIP the target goals are a three-year cumulative EPS goal (weighted at 75% of the total PSU award) and a three-year average ROIC goal (weighted at 25% of the total PSU award). Similar to previous years, the Company completed a pre-definedprocess to adjust goals and to approve the adjustments to be applied to the actual results, in each case, based on adjustments required under the LTIP, for the applicable fiscal year's awards. With respect to outstanding PSUs granted in 2022, 2023 and 2024 the EPS goal was adjusted for the effects during fiscal 2024 of the impact of share repurchases, completed and certain incomplete acquisitions and changes in foreign exchange rate. Accordingly, the Compensation Committee reduced the three-year EPS performance goal for the PSUs granted in 2022, 2023 and 2024 by 0%, 2% and 2%, respectively. These adjustments to the EPS goals were reviewed and approved by the Compensation Committee.
44
Fiscal 2024 Annual LTIP Award
Based on a review of competitive market practices and individual performance, the Compensation Committee approved the LTIP awards set forth in the table below to the Named Executive Officers in fiscal 2024. Each such grant was made under the Company's 2024 Stock Incentive Plan.
Named Executive Officers |
PSUs |
RSUs |
Aggregate grant date fair value |
|||
Chairman and Chief Executive Officer (Principal Executive Officer) |
65,726 | 35,391 | ||||
Ronald N. South Senior Vice President, Chief Financial Officer (Principal Financial Officer) |
10,032 | 10,032 | ||||
Executive Vice President and Chief Strategic Officer |
13,376 | 13,376 | ||||
Executive Vice President and Chief Operating Officer |
13,376 | 13,376 | ||||
President (effective Advisor) |
8,546 | 8,546 |
1 Based on a review of competitive market practices and individual performance, the Compensation Committee revised the value of the annual equity grants under the 2024 LTIP for the Named Executive Officers as compared to the value of their respective annual LTIP awards granted in fiscal 2023 as follows: (i)
Under the 2024 LTIP, PSUs vest 100% on the third anniversary of the grant date (three-year cliff vesting) upon achievement of specified performance vesting goals, and RSUs vest 100% on the fourth anniversary of the grant date (four-year cliff vesting), in each case subject to continued service from the grant date until the applicable vesting date (except that the grants provide for pro-ratedor accelerated vesting upon certain qualifying terminations such as retirement, death or disability, or termination without cause following a change in control (as defined in the 2024 Stock Incentive Plan)).
PSUs granted to Named Executive Officers that vested in Fiscal 2024 and
PSUs were not granted in fiscal 2021 and therefore no PSUs vested in fiscal 2024. PSUs were reinstated in fiscal 2022 and each year thereafter.
In
45
2023 and 2024. The Compensation Committee reviewed the performance of the Company and the resulting payout and determined no adjustments would be made to the 0% payout for any recipient of 2022 PSUs (including the Named Executive Officers).
Benefits and Perquisites
The Company's executive compensation program also includes benefits and perquisites. For fiscal 2024, these benefits include annual matching contributions of up to 7% of base salary to executive officers' 401(k) Plan accounts, annual allocations to the Company's Supplemental Executive Retirement Plan ("SERP") accounts, health benefits, life insurance coverage, disability and business travel insurance. The Company also maintains a deferred compensation plan (the "Deferred Compensation Plan") under which the Named Executive Officers may participate. The Company does not make any contributions to the Deferred Compensation Plan and all amounts outstanding under the Deferred Compensation Plan consist solely of participant contributions. The Company annually reviews these benefits and perquisites and makes adjustments as warranted based on competitive practices and the Company's performance.
A portion of the administrative services provided to
From time to time, the Company utilizes Company-owned and Company-leased vehicles (each a "Company vehicle") and Company-employed drivers to efficiently optimize management's time for business travel. If the Company vehicle and Company-employed driver is used for personal purposes, the executive reimburses the Company the value of the personal usage of the Company vehicle and Company-employed driver's time at the greater of the amount of incremental cost to the Company under
Pay Mix
We utilize the particular elements of compensation described above because we believe that it provides a well-proportioned mix of secure compensation, retention value and at-riskcompensation which produces short-term and long-term performance incentives and rewards without encouraging inappropriate risk-taking by our executive officers. By following this approach, we provide the executive a measure of security with a minimum expected level of compensation, while motivating the executive to focus on business metrics that will produce a high level of short-term and long-term performance for the Company and its stockholders, and long-term wealth creation for the executive, as well as reducing the risk of recruitment of top executive talent by competitors. The mix of metrics used for our annual incentive program (i.e., the HSIP) and our annual LTIP likewise provides an appropriate balance between short-term financial performance and long-term financial and stock performance.
For executive officers, the mix of compensation is weighted heavily toward at-riskpay (performance-based annual incentives and long-term incentives). Maintaining this pay mix results fundamentally in a pay-for-performanceorientation for our executives, which is aligned with our stated compensation philosophy of providing compensation commensurate with performance, while targeting pay at approximately the 50th percentile of the competitive market, other than in very limited circumstances where a deviation may be appropriate based on factors such as expertise and experience, leadership, performance and the competitive landscape.
Our pay mix has resulted in a team of long-tenured, seasoned managers who we believe have a strong commitment to the Company's long-term performance.
Pay Levels and Benchmarking
Pay levels for executive officers are determined based on a number of factors, including the individual's roles and responsibilities within the Company, the individual's experience and expertise, the pay levels for peers within the Company, pay levels in the marketplace for similar positions and performance of the individual and the Company as a whole. The Compensation Committee is
46
responsible for approving pay levels for the executive officers. In determining the pay levels, the Compensation Committee considers all forms of compensation and benefits.
The Compensation Committee assesses competitive market compensation using a number of sources. One of the data sources used in setting competitive market levels for the executive officers is the information publicly disclosed by a peer group of the Company, which is reviewed annually and may change from year to year. The peer group of companies is set by the Compensation Committee and consists of companies engaged in the distribution and/or manufacturing of healthcare products or industrial equipment and supplies. The Compensation Committee determines the peer group of companies based on the following considerations, among other things: (i) Global Industry Classification System or GICS; (ii) companies listed as peers by our current list of peer companies and certain third-party advisory firms and (iii) company size, including, among other things, size by market capitalization, revenue and number of employees. Based on such analysis and with the assistance of the Compensation Committee's independent compensation consultant, Pearl Meyer, in
After consideration of the data collected on external competitive levels of compensation and internal relationships within the executive group, the Compensation Committee makes decisions regarding individual executives' target total compensation goals based on the need to attract, motivate and retain an experienced and effective management team.
Relative to the competitive market data, the Compensation Committee generally intends that the base salary, target annual incentive compensation and equity-based compensation for each executive will be at the median of the competitive market, other than in very limited circumstances where a deviation may be appropriate based on factors such as expertise and experience, leadership, performance and the competitive landscape.
As noted above, notwithstanding the Company's overall pay positioning objectives, pay goals for specific individuals vary based on a number of factors such as scope of duties, potential for advancement, tenure, institutional knowledge and/or difficulty in recruiting a new executive. Actual total compensation in a given year will vary above or below the target compensation levels based primarily on the attainment of operating goals and the creation of stockholder value.
Conclusion
The level and mix of compensation that is finally decided upon by the Compensation Committee is considered within the context of both the objective data from our competitive assessment of compensation and performance, as well as discussion of the subjective factors as outlined above. The Compensation Committee believes that each of the compensation packages is within the competitive range of practices when compared to the objective comparative data even where subjective factors may have influenced the compensation decisions.
Post Termination and Change in Control
The Company believes that a strong, motivated management team is essential to the best interests of the Company and its stockholders. To that end, we have an employment agreement with
47
Company (including Mr. South). The terms and conditions set forth in the CIC Plan are substantially similar to the terms and conditions contained in the change in control agreements.
The change in control agreements and the CIC Plan each provide for certain payments to be made upon termination of employment under certain circumstances, including if the executive's employment is terminated by the Company without cause or by the executive for good reason within two years following a change in control of the Company. (See "Employment Agreement and Post Termination and Change in Control Arrangements" under "Executive and Director Compensation" for a discussion of these agreements.) The Company does not provide any tax gross-upsto our Named Executive Officers (other than for relocation expenses).
Stock Ownership Policy
The Board of Directors believes that, to align the interests of the executive officers, other executive management and directors of the Company with the interests of the stockholders of the Company, the executive officers, other executive management and directors should have a financial stake in the Company.
Further, as a guideline, executive officers and other executive management may only sell up to 75% of the equity value above the ownership requirement. Also, an executive officer's or other executive management's equity in the Company may not be sold until such person satisfies the Company's stock ownership policy.
All executive officers and other executive management are in compliance with the Company's stock ownership policy.
Anti-Hedging and Anti-Pledging Policies
The Company prohibits hedging or other derivative transactions and pledging
On
In
48
incentive compensation paid or awarded pursuant to any incentive plan or arrangement maintained, contributed to or sponsored by the Company and/or its affiliates).
equity awards, such as in connection with a new hire, promotion or retention award. All
equity awards are issued on a
date (the second Friday of the last month of the fiscal quarter) following approval by the Compensation Committee (with delegation to the Chair of the Compensation Committee if under a threshold amount). The Compensation Committee does not take material
information into account when determining the timing of the grant of equity awards, including options, and the timing of the release of material
information is not based on affecting the value of executive compensation.
stock options, the fair value is based on the Black-Scholes value of the stock options. Nearly all equity grants made from
THE COMPENSATION COMMITTEE
|
|
|
|
Executive Officers
Our executive officers and their ages and positions as of
Age |
Position |
|||||
Stanley |
75 |
Chairman, Chief Executive Officer, Director |
||||
Andrea Albertini |
55 | Chief Executive Officer, Global Distribution and Technology | ||||
Michael |
64 | Executive Vice President, Chief Operating Officer | ||||
Mark |
69 | Executive Vice President, Chief Strategic Officer, Director | ||||
Tom Popeck |
56 | Chief Executive Officer, |
||||
Walter Siegel |
65 | Senior Vice President and Chief Legal Officer | ||||
Ronald N. South |
63 | Senior Vice President and Chief Financial Officer |
The biography for
50
industrial manufacturing, including extensive experience in the medical device sector. Prior to joining the Company,
RONALD N. SOUTH has been with the Company since 2008 and in his current position as Senior Vice President and Chief Financial Officer (and principal financial officer and principal accounting officer) since
Other Executive Management
Other members of our executive management and their ages and positions as of
Age |
Position |
|||||
R. |
60 |
Co-ChiefExecutive Officer, |
||||
James |
71 |
Senior Advisor |
||||
Brad Connett |
66 |
Senior Advisor |
||||
David Kochman |
45 |
Senior Vice President, Chief Corporate Affairs Officer |
||||
James Mullins |
60 |
Senior Vice President, Global Supply Chain |
||||
Kelly Murphy |
44 |
Senior Vice President, General Counsel |
||||
Christopher Pendergast |
62 |
Senior Vice President, Chief Technology Officer |
||||
Christine Sheehy |
57 |
Senior Vice President, Chief Human Resources Officer |
||||
Bianka Wilson |
57 |
Co-ChiefExecutive Officer, |
Biographies for such other members of our executive management are:
51
Breslawski has served as Chairman of the board of directors of the
52
53
Summary Compensation Table for Fiscal 2024, Fiscal 2023 and Fiscal 20221
|
Year |
Salary ($) |
Bonus ($) |
Stock ($) |
Option ($) |
Non- Equity ($) |
Change in ($) |
All Other ($) |
Total ($) |
|||||||||||||||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
2024
2023 2022 |
$0
$0 $0 |
$0
$0 |
$0
$0 $0 |
||||||||||||||||||||||||||||||||
Ronald N. South Senior Vice President, Chief Financial Officer (Principal Financial Officer) |
2024
2023 2022 |
$0
$0 $0 |
$0
$0 |
$0
$0 $0 |
||||||||||||||||||||||||||||||||
Executive Vice President and Chief Strategic Officer |
2024
2023 2022 |
$0
$0 $0 |
$0
$0 |
$0
$0 $0 |
$70,6716
$61,917 $65,798 |
$3,575,410
$3,217,224 $3,266,767 |
||||||||||||||||||||||||||||||
Executive Vice President and Chief Operating Officer |
2024
2023 |
$731,850
$670,804 |
$0
$0 |
$2,000,000
$1,792,000 |
$0
$0 |
$669,575
$447,982 |
$0
$0 |
$67,2956
$57,766 |
$3,468,720
$2,968,552 |
|||||||||||||||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
2024
2023 2022 |
$901,750
$866,992 $831,661 |
$0
$0 $0 |
$1,312,500
$1,250,000 $1,452,800 |
$0
$0 $363,200 |
$732,721
$498,920 $832,274 |
$0
$0 $0 |
$83,2826
$77,005 $84,918 |
$3,030,253
$2,692,917 $3,564,853 |
__________________________
1 Amounts reflected in the table have not been reduced to reflect a Named Executive Officer's election to defer receipt of cash compensation pursuant to the Company's Deferred Compensation Plan. Messrs. Bergman and Ettinger participated in the Deferred Compensation Plan in fiscal 2024. The amounts they deferred in fiscal 2024 are set forth in the Nonqualified Deferred Compensation for Fiscal 2024 table on page 65 of this proxy statement.
2 These amounts include RSUs and PSUs granted to Named Executive Officers on March 4, 2024 and March 9, 2024, as applicable. These amounts represent restricted stock units valued based on the aggregate grant date fair value of the award computed in accordance with FASB ASC Topic 718. These amounts do not necessarily reflect the actual value that may be realized by the Named Executive Officer upon vesting. Information regarding assumptions made in valuing the stock awards can be found in Note 18 of the "Notes to Consolidated Financial Statements" included in Item 8 of our Annual Report on Form 10-K for the year ended December 28, 2024, as filed with the
3 Represents Options valued based on the Black-Scholes valuation model in accordance with FASB ASC Topic 718. Information regarding assumptions made in valuing the Option awards can be found in Note 18 of the "Notes to Consolidated Financial Statements" included in Item 8 of our Annual Report on Form 10-K for the year ended December 28, 2024, as filed with the
4 Represents annual incentive compensation (i.e.,bonus) paid under the HSIP. See "Compensation Structure-Pay Elements-Details-Annual Incentive Compensation" under the Compensation Discussion and Analysis for a description of the HSIP.
5 Includes the following: (i) $23,000 matching contribution under 401(k) Plan account; (ii) $19,776 in excess life insurance premiums; (iii) $95,252 in SERP contribution; (iv) $1,231 in excess business travel insurance; (v) $73,925 in personal commuting expenses for use of the Company's car service; (vi) $157,457 for the cost of providing administrative services to
6 For each of Messrs. South, Mlotek, Ettinger and Breslawski includes the following: (i) $23,000 in matching contribution under 401(k) Plan account; (ii) $431 in excess business travel insurance; (iii) $9,377, $13,777, $10,732 and $19,776, respectively, in excess life insurance premiums and (iv) $20,892, $28,463, $28,132 and $40,075, respectively, in SERP contribution. For each of Messrs. Mlotek and Ettinger, such amount also includes a $5,000 services award payment for 30 years of service with the Company.
54
Other Information Related to Summary Compensation Table
Stock Awards and Option Awards
See "Compensation Structure-Pay Elements-Details-Long-Term Equity-Based Awards" under the Compensation Discussion and Analysis for a discussion of stock awards and stock option awards.
Non-EquityIncentive Plan Compensation
See "Compensation Structure-Pay Elements-Details-Annual Incentive Compensation" under the Compensation Discussion and Analysis for a discussion on non-equityincentive plan compensation.
Change in Pension Value and Non-QualifiedDeferred Compensation Earnings
For employees of the Company, including Named Executive Officers, we do not maintain a qualified defined benefit plan.
We maintain a Supplemental Executive Retirement Plan for certain eligible participants who are not able to receive the full Company matching contribution under our 401(k) Plan due to certain
We also maintain a Deferred Compensation Plan pursuant to which our Named Executive Officers are eligible to participate. We do not make any contributions to the Deferred Compensation Plan and the amounts under the plan consist entirely of participant contributions and are fully vested. The amounts under the Deferred Compensation Plan may become payable during employment upon designated fixed payment dates or following a termination of employment (subject to a six-monthdelay in certain instances) or a change in control of the Company.
All Other Compensation
See "Compensation Structure-Pay Elements-Details-Benefits and Perquisites" under the Compensation Discussion and Analysis for a discussion on all other compensation.
Compensation Policies and Practices as they Relate to Risk Management
The Company conducted a risk assessment of its compensation policies and practices for all employees, including executive officers. The Compensation Committee reviewed the Company's risk assessment process and results and determined that our compensation programs are not reasonably likely to have a material adverse effect on the Company.
Tax Gross-UpProvisions
We do not provide any tax gross-upsto our Named Executive Officers (other than for relocation expenses).
55
Employment Agreement and Post Termination and Change in Control Arrangements
Employment Agreement with the Chief Executive Officer
The Company and
The employment agreement provides for
Pursuant to his employment agreement, if
• |
In the case |
• |
In the case |
56
would vest as to a pro-rataportion on the date of such termination and based on the number of days elapsed in the vesting period, with the remainder of such awards continuing to vest pursuant to the applicable vesting schedule and (iii) all other outstanding awards that vest based on the achievement of the applicable performance goals would continue to vest pursuant to the applicable vesting schedule, subject to actual performance over the performance period, without proration. |
If
In consideration of
If
If
In the event
Unless his employment agreement is terminated for cause, subject to the Release Requirement, we will continue the participation of
57
become eligible to receive under any health and medical benefit plans of any subsequent employer. Such health and medical coverage may be provided pursuant to a fully-insured replacement policy or annual cash payments to obtain a replacement policy.
Named Executive Officers Other than the Chief Executive Officer
We have entered into change in control agreements and/or a CIC Plan (as defined in "Post Termination and Change in Control"), (with substantially the same terms as the change in control agreements) with the Named Executive Officers, other than
Pursuant to the change in control agreements and/or the CIC Plan, the Named Executive Officers, other than
58
Post Termination and Change in Control Calculations
The amounts set forth in the table below represent amounts that would have been paid to the Named Executive Officers, pursuant to their employment (if applicable), change in control and equity award agreements, if such Named Executive Officers' employment was terminated on December 27, 2024 (the last business day of fiscal 2024) under the various scenarios set forth below or in connection with a change in control that occurred on such date.
Name and Principal Position; Post Termination/Change in Control Scenario |
Cash |
Annual |
Continuation |
Acceleration |
Other |
Excise Tax |
Total |
|||||||||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
||||||||||||||||||||||||||||
Company termination for cause |
$0 | $0 | $0 | $0 | $0 | n/a | $05 | |||||||||||||||||||||
Resignation without good reason and not due to retirement or non-renewal of employment contract |
$0 | $0 | $299,000 | $0 | $726,847 | n/a | $ 1,025,8476 | |||||||||||||||||||||
Company termination without cause, due to voluntary resignation for good reason |
$7,552,903 | $1,813,756 | $299,000 | $1,580,820 | $846,391 | n/a | $12,092,8707 | |||||||||||||||||||||
Resignation due to retirement not in connection with a change in control |
$0 | $1,813,756 | $299,000 | $6,270,009 | $726,847 | n/a | $9,109,6128 | |||||||||||||||||||||
Termination due to disability |
$7,552,903 | $1,813,756 | $299,000 | $13,751,292 | $846,391 | n/a | $24,263,3429 | |||||||||||||||||||||
Resignation for good reason or Company termination without cause or non-renewalof the employment contract by the Company within two years after a change in control or Company termination without cause within 90 days prior to a change in control or after the first public announcement of a pending change in control. |
$12,085,134 | $1,813,756 | $299,000 | $18,959,599 | $1,113,315 | n/a | $34,270,80410 | |||||||||||||||||||||
Resignation due to retirement within two years of a change in control |
$0 | $1,813,756 | $299,000 | $18,959,599 | $726,847 | n/a | $21,799,20211 | |||||||||||||||||||||
Death of executive |
$0 | $1,813,756 | $152,000 | $13,751,292 | $0 | n/a | $15,717,04812 | |||||||||||||||||||||
All Named Executive Officers, Other than the CEO |
||||||||||||||||||||||||||||
Termination without cause, voluntary termination for good reason within two years following a change in control, within 90 days prior to a change in control or after the first public announcement of a pending change in control |
||||||||||||||||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
$2,497,783 | $517,540 | $65,590 | $4,224,637 | $0 | n/a | $7,305,55013 | |||||||||||||||||||||
Executive Vice President and Chief Strategic Officer |
$4,729,390 | $768,489 | $48,292 | $5,804,650 | $0 | n/a | $11,350,82113 | |||||||||||||||||||||
Executive Vice President and Chief Operating Officer |
$3,052,264 | $669,575 | $0 | $5,428,678 | $0 | n/a | $9,150,51713 |
59
Name and Principal Position; Post Termination/Change in Control Scenario |
Cash |
Annual |
Continuation |
Acceleration |
Other |
Excise Tax |
Total |
|||||||||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
$5,811,526 | $732,721 | $48,292 | $4,686,733 | $0 | n/a | $11,279,27213 | |||||||||||||||||||||
Death or Disability |
||||||||||||||||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
$0 | $0 | $0 | $3,433,35714 | $0 | n/a | $3,433,357 | |||||||||||||||||||||
Executive Vice President and Chief Strategic Officer |
$0 | $0 | $0 | $4,751,60714 | $0 | n/a | $4,751,607 | |||||||||||||||||||||
Executive Vice President and Chief Operating Officer |
$0 | $0 | $0 | $4,394,72014 | $0 | n/a | $4,394,720 | |||||||||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
$0 | $0 | $0 | $3,995,72014 | $0 | n/a | $3,995,720 |
1 Includes annual incentive compensation for the year of termination based on achievement of performance goals.
2 Represents the value of unvested RSUs and PSUs and unvested Options that would accelerate and vest, if any, on termination. In the case of RSUs, the value is calculated by multiplying the number of shares of restricted stock units that accelerate by $70.42, the per share closing price of common stock on December 27, 2024. In the case of PSUs, the value is calculated by multiplying the number of shares of restricted stock units granted on the grant date (i.e., target award) by $70.42, the per share closing price of common stock on December 27, 2024. In the case of Options, the value is calculated by multiplying the number of unvested Options that accelerate by the difference between $70.42 (the per share closing price of common stock on December 27, 2024) and the exercise price of the applicable Options.
3 We do not provide any tax gross-upsto our Named Executive Officers (other than for relocation expenses).
4 Does not include the vested SERP amounts for the Named Executive Officers. Such vested amounts are paid following a termination of employment (subject to a six-monthdelay in certain instances) or within 30 days following a change in control. Also does not include the amounts for the Named Executive Officers under the Company's Deferred Compensation Plan, all of which are fully vested and consist solely of participant contributions. Such vested amounts become payable upon a termination of employment as a result of death or disability in a lump sum cash payment within 60 days after such employment termination. Such vested amounts also become payable in a lump sum cash payment within 60 days following a change in control. (See "Nonqualified Compensation for Fiscal 2024" tables for additional disclosure regarding these vested amounts.)
5 The Company will have no further obligation to
6 Includes (i) health and welfare coverage for
7 Includes (i) a make-uppension payment, calculated as the value of the excess of (a) the fully vested value of benefits to
8 Includes (i) a pro rata portion of the annual incentive compensation payable for the year of termination based on achievement of performance goals, (ii) health and welfare coverage for
60
9 Includes (i) the Make-UpPension Payment, (ii) 200% current base annual salary, (iii) 200% average annual incentive compensation paid in the previous three years, (iv) health and welfare coverage for
10 Includes (i) 300% current base annual salary, (ii) 300% of highest annual incentive compensation paid in the previous two years, (iii) health and welfare coverage for
11 Includes the payments and benefits described in footnote 8 above, except that all of
12 Includes (i) health and welfare coverage for
13 Includes (i) annual incentive compensation payable for the year in which termination occurs based on achievement of performance goals, (ii) 200% current annual salary (defined to include salary and the Company's contribution to the 401(k) Plan and SERP plan for the full year preceding the change in control), (iii) 200% annual incentive compensation at target level in the year of termination, (iv) full vesting of any unvested equity awards (with any PSUs vesting at target level of performance) and (v) health and welfare continuation of plans for 24 months following termination or until coverage with subsequent employer begins; except that Messrs. Mlotek and Breslawski's calculations set forth in (ii) and (iii) above are based on 300%. If any amounts owed to Messrs. South, Mlotek, Ettinger and/or Breslawski in connection with a change in control of the Company are subject to the excise tax imposed by Section 4999 of the Code, we will cut back such amounts to a safe harbor limit so that the excise tax is not triggered, unless the net after-taxvalue of the amounts due after imposition of the excise tax would be greater (in which case no reduction will occur).
14 In the event of any termination of employment due to death or disability, the Named Executive Officers (other than
61
Grants of Plan-Based Awards for Fiscal 2024
|
Type of Grant1 |
Grant Date | Estimated Potential Payouts Under Non- Equity Incentive Plan Awards |
Estimated Future Payouts Under Equity Incentive Plan Awards3 |
All Other Stock Awards4 Number of Shares of Stock or Units (#) |
All Other Option Awards Number of Secur- ities Under- lying Options (#) |
Exercise or Base Price of Option Awards ($/Sh) |
Grant Date Fair Value of Stock and Option Awards |
||||||||||||||||||||||||||||||||||||
Thres- hold ($) |
Target ($) |
Maximum2 ($) |
Th- res- hold (#) |
Target (#) |
Maxi- mum (#) |
|||||||||||||||||||||||||||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
HSIP
PSU/RSU SO |
n/a
3/4/2024 n/a |
$0 | $2,564,700 | $3,812,640 | 0 | 65,726 | 131,452 | 35,391 | 0 | n/a | $7,764,800
n/a |
||||||||||||||||||||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
HSIP
PSU/RSU SO |
n/a
3/9/2024 n/a |
$56,500 | $565,000 | $735,439 | 0 | 10,032 | 20,064 | 10,032 | 0 | n/a | $1,500,000
n/a |
||||||||||||||||||||||||||||||||
Executive Vice President and Chief Strategic Officer |
HSIP
PSU/RSU SO |
n/a
3/9/2024 n/a |
$23,250 | $775,000 | $1,124,362 | 0 | 13,376 | 26,752 | 13,376 | 0 | n/a | $2,000,000
n/a |
||||||||||||||||||||||||||||||||
Executive Vice President and Chief Operating Officer |
HSIP
PSU/RSU SO |
n/a
3/9/2024 n/a |
$72,500 | $725,000 | $937,554 | 0 | 13,376 | 26,752 | 13,376 | 0 | n/a | $2,000,000
n/a |
||||||||||||||||||||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
HSIP
PSU/RSU SO |
n/a
3/4/2024 n/a |
$0 | $963,000 | $1,357,355 | 0 | 8,546 | 17,092 | 8,546 | 0 | n/a | $1,312,500
n/a |
1 "HSIP" means annual incentive compensation (i.e.,bonus) paid under the 2024 Henry Schein Incentive Plan. "PSU/RSU" means restricted stock unit awards (PSUs and RSUs) made pursuant to the Company's 2024 Stock Incentive Plan. See "Compensation Structure-Pay Elements-Details-Annual Incentive Compensation" under the Compensation Discussion and Analysis for a discussion on the HSIP.
2 The maximum payout percentage under the HSIP for the Named Executive Officers is 200% for the Company Financial/EPS Goal, ranges from 115% to 200% for the Business Financial/Individual Goals (depending on the specific category of the goal applicable to such Named Executive Officer) and is 115% for the Strategic Scorecard Goals.
3 The maximum payout percentage for the 2024 LTIP awards of performance-based restricted stock is 200%.
4 These amounts include awards of RSUs granted to Messrs. Bergman and Breslawski on March 4, 2024 and to the other Named Executive Officers on March 9, 2024, each with four-year cliff vesting.
Estimated Potential Payouts Under Non-EquityIncentive Plan Awards
The HSIP awards paid to the Named Executive Officers appear in the Summary Compensation Table in the column captioned "Non-EquityIncentive Plan Compensation." The threshold, target and maximum amount of these HSIP awards appear in the Grants of Plan-Based Awards Table in the column captioned "Estimated Future Payouts Under Non-EquityIncentive Plan Awards."
Estimated Future Payouts Under Equity Incentive Plan Awards, All Other Stock Awards and All Other Option Awards
Awards of PSUs and RSUs granted to the Named Executive Officers appear in the Summary Compensation Table in the column captioned "Stock Awards." Options granted to the Named Executive Officers appear in the Summary Compensation Table in the column captioned "Option Awards" for the years in which they were awarded. We did not grant Named Executive Officers options in fiscal 2024.
The threshold, target and maximum amount of the PSUs appear in the Grants of Plan-Based Awards Table in the column captioned "Estimated Future Payouts Under Equity Incentive Plan Awards."
62
Exercise or Base Price of Option Awards
We did not grant Named Executive Officers options in fiscal 2024.
Outstanding Equity Awards at 2024 Fiscal Year-End
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
Position |
Number of Securities Underlying Unexercised Options (#) Exercisable |
Number of Securities Underlying Unexercised Options (#) Unexercisable |
Equity Incentive Plan Awards: Number of Securities Underly- ing Unexercis- ed Unearned Options1 (#) |
Option Exercise Price ($) |
Option Expiration Date2 |
Number of Shares or Units of Stock That Have Not Veste3 (#) |
Market Value of Shares or Units of Stock That Have Not Vested4 ($) |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested5 (#) |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested4 ($) |
|||||||||||||||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
89,510
19,719 |
0
9,860 |
n/a
n/a |
$62.71
$86.27 |
03/03/2031
03/16/2032 |
114,071 | $8,032,880 | 56,302 | $3,964,787 | |||||||||||||||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
3,727
9,930 |
0
4,966 |
n/a
n/a |
$62.71
$86.27 |
03/03/2031
03/16/2032 |
34,325 | $2,417,167 | 8,410 | $592,232 | |||||||||||||||||||||||||||
Executive Vice President and Chief Strategic Officer |
35,798
9,186 |
0
4,594 |
n/a
n/a |
$62.71
$86.27 |
03/03/2031
03/16/2032 |
50,595 | $3,562,900 | 11,322 | $797,295 | |||||||||||||||||||||||||||
Executive Vice President and Chief Operating Officer |
31,952
7,696 |
0
3,849 |
n/a
n/a |
$62.71
$86.27 |
03/03/2031
03/16/2032 |
46,800 | $3,295,656 | 11,200 | $788,704 | |||||||||||||||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
40,927
9,018 |
0
4,509 |
n/a
n/a |
$62.71
$86.27 |
03/03/2031
03/16/2032 |
43,655 | $3,074,185 | 7,321 | $515,545 |
1 The Company does not issue performance-based options.
2 All stock options granted under the
3 Represents RSUs awarded to the Named Executive Officers as part of their equity grants.
4 Based on the closing market price of $70.42 of the Company's common stock on December 27, 2024, the last trading day in fiscal 2024.
5 Represents the number of performance-based restricted stock units granted in 2022, 2023 and 2024 under the
63
Option Exercises and Stock Vested for Fiscal 2024
Option Awards | Stock Awards | |||||||||||||||
|
Number of Shares Acquired on Exercise (#) |
Value Realized on Exercise ($) |
Number of Shares Acquired on Vesting (#)1 |
Value Realized on Vesting ($)2 |
||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
0 | $0 | 0 | $0 | ||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
0 | $0 | 2,312 | $177,747 | ||||||||||||
Executive Vice President and Chief Strategic Officer |
0 | $0 | 7,947 | $610,965 | ||||||||||||
Executive Vice President and Chief Operating Officer |
0 | $0 | 5,780 | $444,366 | ||||||||||||
President (effective April 1, 2025, Senior Advisor) |
0 | $0 | 9,085 | $698,455 |
1 For each Named Executive Officer (other than
2 The value realized from vesting of restricted stock units is deemed to be the market value of the common stock on the date of vesting, multiplied by the number of shares of common stock underlying the restricted stock units that vested. The closing market price on March 1, 2024 (the actual vesting date of March 3, 2024 was a non-businessday so the vesting occurred on the prior business day) was $76.88.
Nonqualified Deferred Compensation for Fiscal 2024
The following table provides information regarding our SERP. (See "Compensation Structure-Pay Elements-Details-Benefits and Perquisites" under the Compensation Discussion and Analysis for a discussion on our SERP.)
|
Executive Contributions in Last Fiscal Year ($) |
Registrant Contributions in Last Fiscal Year ($) |
Aggregate Earnings in Last Fiscal Year ($) |
Aggregate Withdrawals/ Distributions ($) |
Aggregate Balance at Last Fiscal Year End ($) |
|||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
$0 | $91,273 | $214,946 | $0 | $5,446,994 | |||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
$0 | $18,523 | $10,191 | $0 | $170,582 | |||||||||||||||
Executive Vice President and Chief Strategic Officer |
$0 | $25,677 | $10,798 | $0 | $1,464,108 | |||||||||||||||
Executive Vice President and Chief Operating Officer |
$0 | $24,456 | $49,795 | $0 | $901,728 | |||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
$0 | $38,189 | $749,190 | $0 | $4,018,588 |
64
The following table provides information regarding our Deferred Compensation Plan. The Company does not make any contributions to the Deferred Compensation Plan. All amounts in such plan are fully vested and consist solely of participant contributions. Such vested amounts may become payable during employment upon designated fixed payment dates or following a termination of employment (subject to a six-monthdelay in certain instances) or a change in control of the Company. (See "Compensation Structure-Pay Elements-Details-Benefits and Perquisites" under the Compensation Discussion and Analysis for a discussion on our Deferred Compensation Plan.)
|
Executive Contributions in Last Fiscal Year ($) |
Registrant Contributions in Last Fiscal Year ($) |
Aggregate Earnings in Last Fiscal Year ($) |
Aggregate Withdrawals/ Distributions ($) |
Aggregate Balance at Last Fiscal Year End ($) |
|||||||||||||||
Chairman and Chief Executive Officer (Principal Executive Officer) |
$744,154 | $0 | $571,648 | $0 | $4,470,691 | |||||||||||||||
Ronald N. South Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
n/a | n/a | n/a | n/a | n/a | |||||||||||||||
Executive Vice President and Chief Strategic Officer |
$0 | $0 | $956,146 | $680,269 | $6,327,392 | |||||||||||||||
Executive Vice President and Chief Operating Officer |
$103,720 | $0 | $163,404 | $0 | $1,505,145 | |||||||||||||||
President (effective April 1, 2025, Senior Advisor) |
$0 | $0 | $115,309 | $0 | $886,997 |
CEO Pay Ratio
As a result of the rules adopted by the
To determine our median employee, we utilized data as of October 1, 2022 (the "Determination Date"). We excluded 994 employees from the following eight countries/territories, which represents approximately 4.8% of the Company's total employee population:
Country/Territory |
Approximate Number of Employees |
Approximate Percentage of Total Population |
||||||
|
22 | 0.11% | ||||||
|
499 | 2.42% | ||||||
|
77 | 0.37% | ||||||
|
13 | 0.06% | ||||||
|
10 | 0.05% | ||||||
|
90 | 0.44% | ||||||
|
136 | 0.66% | ||||||
|
147 | 0.71% |
We then examined the 2022 total annual cash compensation, including base salary, overtime, bonus and commission for all individuals, excluding our CEO, who were employed by us on the Determination Date. We included all employees, whether employed on a full-time, part-time, seasonal or temporary basis. We calculated annual base salary based on a reasonable estimate of hours worked
65
("PvP Rules"), we are providing the following information about the relationship between "compensation actually paid" to our CEO (referred to below as our Principal Executive Officer or PEO) and average "compensation actually paid" to our other NEOs and certain metrics of our financial performance for the last three years, in each case, calculated in accordance with the PvP Rules.
philosophy and how the Compensation Committee makes its decisions about executive pay, see the Compensation Discussion and Analysis beginning on page 34 of this proxy statement.
Value of initial fixed $100
investment based on |
||||||||||||||||||||||||||||||||||
Year
|
Summary
Compensation Table Total for PEO |
Compensation
Actually Paid to PEO 1
|
Average
Summary Compensation Table Total for non-PEO NEOs
|
Average
Compensation Actually Paid to Non-PEO
NEOs
2
|
Total
Shareholder Retu 3
|
Peer Total
Shareholder Retu 3
|
Net Income/
(Loss)
(in millions)
|
Company-Selected
Measure: Non-GAAP
EPS
4
|
||||||||||||||||||||||||||
2024 | $11,640,272 | $7,852,214 | $3,193,394 | $2,322,504 | $106 | $144 | $398 | $4.74 | ||||||||||||||||||||||||||
2023 | $10,005,729 | $4,941,292 | $2,807,442 | $1,705,337 | $114 | $139 | $436 | $4.50 | ||||||||||||||||||||||||||
2022 | $8,255,135 | $9,962,917 | $2,945,446 | $3,402,202 | $120 | $136 | $566 | $5.38 | ||||||||||||||||||||||||||
2021 | $10,786,180 | $28,293,056 | $3,854,485 | $7,569,084 | $113 | $142 | $660 | $5.05 | ||||||||||||||||||||||||||
2020 | $6,239,637 | ($8,384,241) | $2,649,163 | ($811,730) | $99 | $114 | $419 | $3.53 |
The dollar amounts reported in this column represent the CAP to our PEO,
The dollar amounts reported in this column represent the CAP to our
NEOs as a group, as computed in accordance with PvP Rules. The dollar amounts do not reflect the actual amount of compensation earned by or paid to the
NEOs as a group during the applicable year.
Cumulative shareholder returns reflect $100 invested as of market close on December 27, 2019, the final trading day of the Company's fiscal year ended December 28, 2019 ("fiscal 2019"); Peer Total Shareholder Retubased on Dow Jones
for the year ended December 28, 2024, as filed with the
Reflects the Company's selected measure of
EPS which is consistently calculated for each year reflected in the table (see chart below). The adjusted EPS used in the incentive plans (HSIP and PSUs) may reflect other adjustments which are generally described in the Compensation Discussion and Analysis.
2020
|
2021
|
2022
|
2023
|
2024
|
||||||||||||||||
GAAP diluted EPS from continuing operations
attributable to
|
$2.81
|
$4.45
|
$3.91
|
$3.16
|
$3.05
|
|||||||||||||||
Non-GAAP
Adjustments, net of tax and attribution to noncontrolling interests: |
||||||||||||||||||||
Restructuring and integration costs
|
$0.17 | $0.03 | $0.74 | $0.40 | $0.62 | |||||||||||||||
Acquisition intangible amortization
|
Excluded | Excluded | Excluded | $0.70 | $0.88 | |||||||||||||||
Litigation settlements
|
- | $0.08 | - | - | $0.03 | |||||||||||||||
Cybersecurity Incident- insurance proceeds, net of third-party advisory expenses
|
- | - | - | $0.06 | $(0.18) | |||||||||||||||
Impairment of intangible assets
|
Excluded | - | $0.16 | $0.04 | - | |||||||||||||||
Impairment of capitalized assets
|
- | - | - | $0.14 | $0.05 | |||||||||||||||
Change in contingent consideration
|
- | - | - | - | $0.28 | |||||||||||||||
Costs associated with shareholder advisory matters
|
- | - | - | - | $0.01 | |||||||||||||||
Gain on sale of equity investments
|
$(0.01) | $(0.05) | - | - | - | |||||||||||||||
Non-GAAP
diluted EPS attributable to |
$2.97
|
$4.51
|
$4.81
|
$4.50
|
$4.74
|
|||||||||||||||
Reconciling items to present
non-GAAP
diluted EPS attributable to
|
||||||||||||||||||||
Acquisition intangible amortization
|
$0.48 | $0.54 | $0.57 | - | - | |||||||||||||||
Impairment of intangible assets
|
$0.08 | - | - | - | - | |||||||||||||||
Non-GAAP
diluted EPS attributable to 1
|
$3.53
|
$5.05
|
$5.38
|
$4.50
|
$4.74
|
The Company revised its calculation of
diluted EPS in fiscal 2023. As such, the Company adjusted the calculation of
diluted EPS for fiscal 2020, fiscal 2021 and fiscal 2022 to be consistent with the calculation of
diluted EPS used in fiscal 2023 and fiscal 2024.
Year
|
SCT Total
(a)
|
Less Equity
Deduction from SCT Total 1
(b)
|
Value of
Current Year Equity Awards at
Year-end
2
(c)
|
Change in Value
of Unvested Prior
Year Awards
During Year 3
(d)
|
Change in Value
of Prior Year Awards That Vested During Year 4
(e)
|
Total
Compensation Actually Paid 5
(a + b + c + d + e)
|
||||||
2024 | $11,640,272 | ($7,764,800) | $5,395,792 | ($1,428,384) | $9,334 | $7,852,214 | ||||||
2023 | $10,005,729 | ($7,395,000) | $4,370,663 | ($1,726,122) | ($313,978) | $4,941,292 | ||||||
2022 | $8,255,135 | ($3,971,000) | $2,850,094 | $1,434,350 | $1,394,338 | $9,962,917 | ||||||
2021 | $10,786,180 | ($5,770,209) | $7,378,604 | $15,932,034 | ($33,552) | $28,293,056 | ||||||
2020 | $6,239,637 | ($3,438,000) | $0 | ($10,977,620) | ($208,258) | ($8,384,241) |
Represents the grant date fair value of equity-based awards made during the fiscal year based on the amounts reported in the "Stock Awards" and "Option Awards" columns in the SCT for the applicable year.
Represents the
fair value of equity awards that were made during the fiscal year (no grants made during a fiscal year vested during the same fiscal year).
Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that were still unvested as of
Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that vested during the current fiscal year.
SCT total, less SCT equity grant date fair value, plus
fair value of equity awards made during the year, plus the change in fair value during the year of equity awards that remained unvested as of
plus the change in fair value of equity awards that vested during the year.
NEO. Our
NEOs by year are as follows: 2024 and 2023 - Messrs. South, Mlotek, Ettinger and Breslawski; 2022 - Messrs. South, Paladino, Connett, Mlotek and Breslawski; 2021 and 2020 - Messrs. Paladino, Benjamin, Mlotek and Breslawski.
Year
|
SCT Total
(a)
|
Less Equity
Deduction from SCT Total 1
(b)
|
Value of Current
Year Equity Awards at
Year-end
2
(c)
|
Change in Value
of Unvested Prior Year Awards
During Year 3
(d)
|
Change in Value
of Prior Year Awards That Vested During Year 4
(e)
|
Total
Compensation Actually Paid 5
(a -b + c + d + e)
|
||||||
2024 | $3,193,394 | ($1,703,125) | $1,187,862 | ($364,536) | $8,909 | $2,322,504 | ||||||
2023 | $2,807,442 | ($1,565,500) | $1,063,479 | ($555,301) | ($44,784) | $1,705,337 | ||||||
2022 | $2,945,446 | ($1,441,433) | $1,179,477 | $353,110 | $365,601 | $3,402,202 | ||||||
2021 | $3,854,485 | ($2,174,430) | $2,805,529 | $3,118,145 | ($34,646) | $7,569,084 | ||||||
2020 | $2,649,163 | ($1,473,250) | $560,510 | ($2,401,561) | ($146,591) | ($811,730) |
Represents the grant date fair value of equity-based awards made during the fiscal year based on the amounts reported in the "Stock Awards" and "Option Awards" columns in the SCT for the applicable year.
Represents the
fair value of equity awards that were made during the fiscal year (no grants made during a fiscal year vested during the same fiscal year).
Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that were still unvested as of
Represents the change in fair value during the fiscal year of equity-based awards granted in prior fiscal years that vested during the current fiscal year.
SCT total, less SCT equity grant date fair value, plus
fair value of equity awards made during the year, plus the change in fair value during the year of equity awards that remained unvested as of
plus the change in fair value of equity awards that vested during the year.
increments on the first three anniversaries of the grant and expire on the 10
anniversary of the grant (subject to earlier expiration based on certain employment terminations). Fair values at time of the grant, at
2023 and 2024, and on vesting dates for awards that vested during 2024 were all determined using the Black-Scholes model. The table below summarizes the option fair values and related assumptions used to calculate CAP for fiscal years 2023 and 2024. None of the options granted to NEOs have been exercised as of
2024.
Valuation
Purpose for
PVP |
HSIC
Stock Price |
HSIC
Option
Exercise Price |
Expected
Term (years) |
Stock
Price Volatility |
Risk-free
Interest Rate |
Dividend
Yield |
Option
Fair Value |
|||||||
Year-end
2023 |
$75.71 |
$62.71-$86.27
|
3.2 - 4.2 | 28.5% | 3.86% | 0% |
$18.35-$25.58
|
|||||||
2024 Vesting
|
$74.58-$76.88
|
$62.71-$86.27
|
3.0 - 4.0 | 28.2% |
4.17%-4.33%
|
0% | $17.36-$26.22 | |||||||
Year-end
2024 |
$70.42 | $86.27 | 3.2 | 28.1% | 4.50% | 0% | $12.39 |
Key Financial Measures
|
||||||
Adjusted EPS
1
|
||||||
Revenues
2
|
||||||
Operating Income
3
|
||||||
Retuon Invested Capital
4
|
Adjusted EPS is a measure for purposes of the annual incentive program with respect to the Company Selected Measure under the HSIP, as disclosed in the Compensation Discussion and Analysis for each year's proxy statement.
Revenues is a measure for purposes of the annual incentive program with respect to Business Financial/Individual Goals under the HSIP, as disclosed in the Compensation Discussion and Analysis for each year's proxy statement.
Operating Income is a measure for purposes of the annual incentive program with respect to Business Financial/Individual Goals under the HSIP, as disclosed in the Compensation Discussion and Analysis for each year's proxy statement.
Retuon Invested Capital is a measure used along with cumulative adjusted EPS in the 2023-2025 and 2024-2026 PSU grants, as disclosed in the Compensation Discussion and Analysis for this year's proxy statement.
EPS during fiscal years 2020 through 2024.
Director Compensation for Fiscal 2024
|
Fees Earned or Paid in Cash1 ($) |
Stock Awards2 ($) |
Option Awards3 ($) |
Non-Equity Incentive Plan Compensation4 ($) |
Change in Pension Value and Nonqualified Deferred Compensation Earnings5 ($) |
All Other Compensation ($) |
Total ($) |
|||||||||||||||||||||
|
$122,000 | $ | 200,000 | $0 | $0 | $0 | $0 | $ | 322,000 | |||||||||||||||||||
|
$142,000 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 342,000 | |||||||||||||||||||
|
$106,600 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 306,600 | |||||||||||||||||||
|
$165,600 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 365,600 | |||||||||||||||||||
|
$164,600 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 364,600 | |||||||||||||||||||
|
$170,400 | $ | 200,000 | $0 | $0 | $0 | $0 | $ | 370,400 | |||||||||||||||||||
|
$135,200 | $ | 200,000 | $0 | $0 | $0 | $0 | $ | 335,200 | |||||||||||||||||||
|
$39,286 | $ | 200,000 | $0 | $0 | n/a | $61,2647 | $ | 300,549 | |||||||||||||||||||
|
$119,800 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 319,800 | |||||||||||||||||||
|
$119,800 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 319,800 | |||||||||||||||||||
|
$143,600 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 343,600 | |||||||||||||||||||
|
$106,600 | $ | 200,000 | $0 | $0 | n/a | $0 | $ | 306,600 |
1 These cash fee amounts have not been reduced to reflect a director's election (if any) to defer receipt of cash fees pursuant to the Non-Employee Director Deferred Compensation Plan; any such deferrals are disclosed in footnote 5 below.
2 Includes restricted stock unit awards valued based on the aggregate grant date fair value of the award computed in accordance with FASB ASC Topic 718. The amounts shown in the table above do not necessarily reflect the actual value that may be realized by the non-employee director upon vesting. Information regarding assumptions made in valuing the stock awards can be found in Note 18 of the "Notes to Financial Statements" included in Item 8 of our Annual Report on Form 10-K for the year ended December 28, 2024, as filed with the
3 The Company does not grant option awards to non-employee directors.
4 The Company does not grant performance-based annual incentive compensation (i.e.,bonus) to non-employee directors.
5 None of the non-employee directors participated in the Non-Employee Director Deferred Compensation Plan in 2024. Messrs. Ali and Laskawy and
6
7 Represents fees paid to
71
Annual Limit on Director Compensation
Pursuant to the
Fees Earned or Paid in Cash
Directors who are employees of the Company receive no compensation for service as directors. Directors who are not officers or employees of the Company receive such compensation for their services as the Board of Directors may determine from time to time. In February 2024, following a benchmarking analysis, the Compensation Committee reviewed compensation paid to non-employeedirectors and increased the annual retainer from $90,000 to $100,000 for fiscal 2024. Prior to such increase, the value of the annual retainer for the non-employeedirectors was unchanged compared to the value received each year since fiscal 2019. Each non-employeedirector also received $2,200 for each committee meeting attended. The retainers for service as a Committee Chairperson for fiscal 2024 were as follows: (i) $15,000 for the Chairperson of the Nominating and Governance Committee; the Regulatory, Compliance and Cybersecurity Committee and the Strategic Advisory Committee; (ii) $20,000 for the Chairperson of the Compensation Committee and (iii) $25,000 for the Chairperson of the Audit Committee. The Lead Director's retainer for fiscal 2024 was $40,000. In December 2023, following recommendation from the Compensation Committee, the Board of Directors approved the payment of $2,200 per meeting for each meeting attended by the members of the Audit Committee and Regulatory, Compliance and Cybersecurity Committee conducting the review of the October 2023 cybersecurity incident. Such review was completed in fiscal 2024.
Stock Awards
On March 4, 2024, each of the Company's non-employeedirectors as of such date was granted 2,604 RSUs under the 2023 Non-EmployeeDirector Stock Incentive Plan, with each award having a grant date fair value of $200,000 (increased from $175,000 in fiscal 2023). Prior to such increase, the value of the equity awards for the non-employeedirectors was unchanged compared to the value of their awards each year since fiscal 2019. The RSUs granted to the non-employeedirectors in 2024 are subject to time-based vesting and cliff vest at the end of 12 months from the grant date, based on continued service through the applicable vesting date. In May 2024, the Compensation Committee approved the accelerated vesting of the outstanding equity award (2,604 restricted stock units) granted to
All such grants under the 2023 Non-EmployeeDirector Stock Incentive Plan (i) were issued on the date they were approved by the Compensation Committee and (ii) provide for full accelerated vesting upon a change in control (as defined in the 2023 Non-EmployeeDirector Stock Incentive Plan or as defined under Section 409A of the Code), provided that no termination of services has occurred prior to the change in control.
Non-employeedirectors are eligible to defer the date upon which all or a portion of their restricted stock units will be paid out to either (i) a specified payment date occurring on the third, fifth, seventh or tenth anniversary of the scheduled vesting date or (ii) the date of the termination of their services that occurs after the scheduled vesting date. If the deferral election is chosen, to the extent vested, payment will be made within the 30 day period following the earliest of the following to occur: (i) the elected deferred payment date; (ii) the participant's death; (iii) the participant's disability; (iv) the participant's termination of services (other than as a result of death or disability) or (v) a change in control of the Company. Participants are also permitted to further defer the payment date of their restricted stock units in accordance with Section 409A of the Code for one or more additional periods of at least five years (but not more than ten years) beyond the previously elected deferred payment date.
The Compensation Committee assesses "competitive market" compensation when determining the amount of equity awards to grant non-employeedirectors. The Compensation Committee reviews non-employeedirector compensation, including equity awards, against the same peer companies that it uses when evaluating executive officer compensation. The Compensation Committee also reviews, for purposes of determining non-employeedirector equity awards, the companies with revenues between $9 billion and $17 billion that it reviews for evaluation of executive officer compensation. See "Compensation Structure-Pay Elements-Details-Pay Levels and Benchmarking" under Compensation Discussion and Analysis.
72
Non-EquityIncentive Plan Compensation
We do not issue non-equityincentive plan compensation to non-employeedirectors.
Change in Pension Value and Non-QualifiedDeferred Compensation Earnings
For directors, we do not maintain a qualified defined benefit plan.
Since 2004, non-employeedirectors have been eligible to defer all or a portion of certain "eligible director fees" under our Non-EmployeeDirector Deferred Compensation Plan into a cash account or a phantom share account. An investment in the cash account is deemed to be invested in cash equivalents based on the Company's long-term borrowing rate under the Company's principal credit facility. An investment in the phantom share account is deemed to be invested in a unit measurement called a "phantom share." A phantom share is the equivalent to one share of our common stock. The cash accounts are distributed in a lump sum cash payment and the phantom share accounts are distributed in our common stock. Shares of our common stock available for issuance under the Non-EmployeeDirector Deferred Compensation Plan are funded from shares of our common stock that are available under our 2023 Non-EmployeeDirector Stock Incentive Plan, and such an award under the Non-EmployeeDirector Deferred Compensation Plan constitutes an "Other Stock-Based Award" under the 2015 Non-EmployeeDirector Stock Incentive Plan and the 2023 Non-EmployeeDirector Stock Incentive Plan, as applicable. Messrs. Ali and Laskawy and
Stock Ownership Policy
The Company believes that, to align the interests of the directors of the Company with the interests of the stockholders of the Company, the non-employeedirectors of the Company should have a financial stake in the Company. In 2018, the Company updated its stock ownership policy for non-employeedirectors to provide that each non-employeedirector should own equity in the Company equal to the greater of (i) a minimum of 10,000 shares of
Further, as a guideline, non-employeedirectors may only sell up to one-halfof all vested value above the ownership requirement. "Vested value" is defined as the value of shares of any class of common stock, shares of vested restricted stock units, shares of unvested time-based restricted stock units (after netting an estimated amount for taxes, if applicable), warrants or rights to acquire shares of common stock and securities that are convertible into shares of common stock. Also, a non-employeedirector's equity in the Company may not be sold until the non-employeedirector satisfies the Company's stock ownership policy.
Upon request, the Nominating and Governance Committee may consider whether exceptions should be made for any non-employeedirector on whom this requirement would impose a financial hardship or for other appropriate reasons as determined by the Board of Directors.
All non-employeedirectors are in compliance with the Company's stock ownership policy.
Anti-Hedging and Anti-Pledging Policies
The Company prohibits hedging or other derivative transactions and pledging
Director Retirement Policy
In 2015, upon recommendation of the Nominating and Governance Committee, the Board of Directors adopted a director retirement policy. The Company believes that it benefits greatly from contributions by directors who have had significant prior careers and experiences, and that the value of a director's continuing contributions (including how such contributions complement the overall backgrounds and areas of expertise of the full Board of Directors) is a more important factor than a specific age in determining when a highly productive director should retire from the Board of Directors. The Company also recognizes that it is in its interest for directors to retire when that becomes appropriate, as well as the benefit to the Company from adding new directors with new perspectives. The policy provides that the Chairperson of the Nominating and Governance Committee should commence retirement discussions with a
73
director within a few years of approaching his or her 80th birthday. In any event, a director is expected to retire at the end of his or her term during which he or she reaches the age of 80, although this is a general guideline that we expect will be observed in most cases but not a strict requirement. In recognition of
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company maintains a formal, written conflict of interest policy that applies to all employees. Additionally, on an ongoing basis, the Audit Committee is required by its charter to review all "related party transactions" (those transactions that are required to be disclosed in this proxy statement by SEC Regulation S-K,Item 404 and under Nasdaq's rules), if any, for potential conflicts of interest and all such transactions must be approved or ratified by the Audit Committee.
Familial Relationships
KKR Strategic Partnership Agreement
On January 29, 2025, the Company entered into the Strategic Partnership Agreement with KKR, which became a greater than 5% shareholder in March 2025. The Audit Committee reviewed, approved and ratified the related-party transactions contemplated by the Strategic Partnership Agreement.
Board Designees
Pursuant to the Strategic Partnership Agreement, the Company agreed, among other things, to appoint
The Strategic Partnership Agreement provides KKR with customary rights to designate replacement directors that are reasonably acceptable to the Company's Board of Directors in the event either of the Messrs. Lin and Daniel cease to serve as directors under certain circumstances. If KKR ceases to beneficially own and have the right to vote at least 7.5% of the Company's then-outstanding shares of common stock, one KKR Designee (or replacement thereof) shall immediately resign and KKR's designation and replacement rights with respect to such KKR Designee shall fall away. If KKR ceases to beneficially own and have the right to vote at least 5% of the Company's then-outstanding shares of common stock, each KKR Designee (or replacement thereof) shall immediately resign and KKR's designation and replacement rights shall fall away.
KKR is entitled to make an election to extend, among other things, its director nomination rights under the Strategic Partnership Agreement for an additional year (an "Extension Election"). If KKR makes an Extension Election, the KKR Designees will be nominated by the Company's Board of Directors to stand for election at the 2026 Annual Meeting for a term expiring at the Company's 2027 annual meeting of stockholders (the "2027 Annual Meeting").
Pursuant to the Strategic Partnership Agreement, KKR has agreed to vote in favor of the Board-recommended slate of directors at the Annual Meeting and in accordance with the Board's recommendation on any proposal made by another stockholder. However, the Company has agreed that in the event that both
Private Placement of Common Stock
In addition, pursuant to the Strategic Partnership Agreement, the Company agreed to issue and sell in a private placement to KKR 3,285,152 shares (the "Shares") of its common stock, for an aggregate purchase price of $250 million at a purchase price per Share of
74
approximately $76.10 (the "Investment"). The Investment is subject to the satisfaction of customary conditions set forth in the Strategic Partnership Agreement, including, among other things, obtaining HSR Approval, Sweden Approval, Italy Approval and Spain Approval.
The customary standstill restrictions and voting commitments contained in the Strategic Partnership Agreement, shall continue through the later of (i) the earlier of (x) 30 days prior to the opening of the director nomination window for the 2026 Annual Meeting or (y) February 20, 2026, or (ii) if the KKR makes an Extension Election, the earlier of (x) 30 days prior to the opening of the director nomination window for the 2027 Annual Meeting or (y) February 20, 2027, except that the standstill commitments will continue for so long as any KKR Designee remains on the Company's Board of Directors.
Registration Rights Agreement
On the closing date of the Investment, the Company and the Investor will enter into a Registration Rights Agreement providing for certain customary registration rights with respect to the Shares. In addition, the Company will agree to certain customary indemnification provisions relating to indemnification for any material misstatements or omissions by the Company in connection with the registration of the Shares.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee during fiscal 2024 were
During fiscal 2024:
• |
none of the members of the Compensation Committee was an officer (or former officer) or employee of the Company or any of its subsidiaries; |
• |
none of the members of the Compensation Committee had a direct or indirect material interest in any transaction in which the Company was a participant and the amount involved exceeded $120,000; |
• |
none of our executive officers served on the compensation committee (or another board committee performing equivalent functions or, if none, the entire board of directors) of another entity where one of that entity's executive officers served on our Compensation Committee; |
• |
none of our executive officers was a director of another entity where one of that entity's executive officers served on our Compensation Committee; and |
• |
none of our executive officers served on the compensation committee (or another board committee performing equivalent functions or, if none, the entire board of directors) of another entity where one of that entity's executive officers served as a director on our Board of Directors. |
75
PROPOSAL 4
ADVISORY VOTE ON EXECUTIVE COMPENSATION
In accordance with the requirements of Section 14A of the Securities Exchange Act of 1934 (which was added by the Dodd-Frank Wall Street Reform and Consumer Protection Act and the related rules of the
As described in detail in the Compensation Discussion and Analysis beginning on page 34 of this proxy statement, the Company's executive officer compensation program is designed to attract and retain the caliber of officers needed to ensure the Company's continued growth and profitability and to reward them for their performance, the Company's performance and for creating long-term value for stockholders. The primary objectives of the program are to:
• |
align rewards with the achievement of performance goals that enhance stockholder value; |
• |
align rewards with the achievement of the Company's strategic plan; |
• |
support the Company's strong team orientation; |
• |
encourage high potential team players to build a career at the Company; and |
• |
provide rewards that are cost-efficient, competitive with other organizations and fair to employees and stockholders. |
The Company seeks to accomplish these goals in a manner that is aligned with the long-term interests of the Company's stockholders. The Company believes that its executive officer compensation program achieves these goals with its emphasis on long-term equity awards and performance-based compensation, which has enabled the Company to successfully motivate and reward its named executive officers. The Company believes that its compensation program is appropriate and has played an essential role in its continuing financial success by aligning the long-term interests of its named executive officers with the long-term interests of its stockholders.
For these reasons, the Board of Directors recommends a vote in favor of the following resolution:
"RESOLVED, that the compensation paid to the Company's named executive officers, as disclosed pursuant to Item 402 of Regulation S-K,including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED."
As an advisory vote, this Proposal 4 is not binding upon the Company. Notwithstanding the advisory nature of this vote, the Compensation Committee, which is responsible for designing and administering the Company's executive officer compensation program, values the opinions expressed by stockholders in their vote on this Proposal 4, and will consider the outcome of the vote when making future compensation decisions for named executive officers.
The affirmative vote of the holders of a majority of the outstanding shares of common stock present in person or represented by proxy and entitled to vote on this matter is required to approve this Proposal 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF THE COMPANY'S NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THIS PROXY STATEMENT.
76
PROPOSAL 5
RATIFICATION OF SELECTION OF
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
We are asking stockholders to ratify the selection of
Independent Registered Public Accounting Firm Fees and Pre-ApprovalPolicies and Procedures
The following table summarizes fees billed or expected to be billed to us for fiscal 2024 and for fiscal 2023:
Fiscal 2024 | Fiscal 2023 | |||||||
Audit Fees - Annual Audit and Quarterly Reviews |
$8,912,000 | $8,482,000 | ||||||
Audit Related Fees |
$417,000 | $703,000 | ||||||
Tax Fees: - |
||||||||
Tax Advisory Services |
$169,000 | $102,000 | ||||||
Tax Compliance, Planning and Preparation |
$466,000 | $581,000 | ||||||
All Other Fees |
$59,000 | $130,000 | ||||||
Total Fees |
$10,023,000 | $9,998,000 | ||||||
In the above table, in accordance with the
The Audit Committee has determined that the provision of all non-auditservices by
All fees paid or to be paid by us to
Pursuant to the rules and regulations of the
The affirmative vote of the holders of a majority of the outstanding shares of common stock present in person or represented by proxy and entitled to vote on this matter at the Annual Meeting is required to ratify the selection of
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSED RATIFICATION OF THE SELECTION OF BDO
77
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
Role of the Audit Committee
The Audit Committee oversees the Company's financial reporting process on behalf of the Board of Directors, including the Company's internal control over financial reporting, the quality of its financial reporting and the independence and performance of the Company's independent registered public accounting firm. The Audit Committee is responsible for establishing procedures for the receipt, retention and treatment of complaints received by the Company about accounting, internal control over financial reporting or auditing matters and confidential and anonymous submission by employees of the Company of concerns about questionable accounting or auditing matters. On an ongoing basis, the Audit Committee reviews all related party transactions (as defined by applicable regulations), if any, for potential conflicts of interest and all such transactions must be approved by the Audit Committee.
The Audit Committee is composed of four "independent directors" as that term is defined by the listing standards of The Nasdaq Stock Market, Inc. ("Nasdaq"). Three of the members of the Audit Committee are "audit committee financial experts," as defined under the rules of SEC and each of the members of the Audit Committee is able to read and understand fundamental financial statements, and, as such, satisfy the requirements of Nasdaq's Rule 5605(c)(2)(A). The Audit Committee operates under a written charter adopted by the Board of Directors, which is in accordance with the Sarbanes-Oxley Act of 2002 and the rules of the SEC and Nasdaq listing standards relating to corporate governance and audit committees. The Audit Committee reviews and reassesses its charter on a periodic and as required basis.
Management has primary responsibility for the Company's financial statements and the overall reporting process, including the Company's disclosure controls and procedures as well as its system of internal control over financial reporting. The Company is responsible for evaluating the effectiveness of its disclosure controls and procedures on a quarterly basis and for performing an annual assessment of its internal control over financial reporting, the results of which are reported in the Company's annual 10-Kfiling with the SEC.
BDO USA, P.C. ("BDO USA"), the Company's independent registered public accounting firm, audits the annual financial statements prepared by management, expresses an opinion as to whether those financial statements fairly present the consolidated financial position, results of operations and cash flows of the Company and its subsidiaries in conformity with accounting principles generally accepted in the United States and discusses with management any issues that they believe should be raised with management. BDO USA also audits and expresses an opinion on the design and operating effectiveness of the Company's internal control over financial reporting.
The Audit Committee pre-approvesaudit, audit related and permissible non-auditrelated services provided by BDO USA. During fiscal 2024, audit and audit related fees consisted of annual financial statement and internal control audit services, accounting consultations, employee benefit plan audits and other quarterly review services. Non-auditrelated services approved by the Audit Committee consisted of tax compliance, tax advice, tax planning and real estate advisory services.
The Audit Committee meets with management regularly to consider, among other things, the adequacy of the Company's internal control over financial reporting and the objectivity of its financial reporting. The Audit Committee discusses these matters with the appropriate Company financial personnel and internal auditors. In addition, the Audit Committee has discussions with management concerning the process used to support certifications by the Company's Chief Executive Officer and Chief Financial Officer that are required by the SEC and the Sarbanes-Oxley Act to accompany the Company's periodic filings with the SEC.
On an as needed basis and following each quarterly Audit Committee meeting, the Audit Committee meets privately with both BDO USA and the Company's internal auditors, each of whom has unrestricted access to the Audit Committee. BDO USA's ultimate accountability is to the Board of Directors of the Company and the Audit Committee, as representatives of the Company's stockholders. The Audit Committee is also responsible for the selection of BDO USA, and approves in advance its engagements to perform audit and any non-auditservices and the fee for such services.
The Audit Committee annually reviews its independent registered public accounting firm's performance and independence from management. In addition, when appropriate, the Audit Committee discusses with the independent registered public accounting firm plans for audit partner rotation as required by the Sarbanes-Oxley Act.
Review of the Company's Audited Financial Statements for Fiscal 2024
The Audit Committee reviewed the Company's audited financial statements for fiscal 2024, as well as the process and results of the Company's assessment of internal control over financial reporting. The Audit Committee has also met with management, the internal
78
auditors and BDO USA to discuss the financial statements and internal control over financial reporting. Management has represented to the Audit Committee that the financial statements were prepared in accordance with accounting principles generally accepted in the United States and that internal control over financial reporting was effective and that no material weakness in those controls existed as of the fiscal year-endreporting date, December 28, 2024.
The Audit Committee has received from BDO USA the written disclosures and the letter required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant's communications with the Audit Committee concerning independence and has discussed with BDO USA their independence from the Company and its management. The Audit Committee also received reports from BDO USA regarding all critical accounting policies and practices used by the Company, generally accepted accounting principles that have been discussed with management, and other material written communications between BDO USA and management. There were no differences of opinion reported between BDO USA and the Company regarding critical accounting policies and practices used by the Company. In addition, the Audit Committee has also received from, and discussed with, BDO USA the matters required to be discussed by the Public Company Accounting Oversight Board Auditing Standard No. 1301 (Communications with Audit Committees). Finally, the Audit Committee has received from, and reviewed with, BDO USA all communications and information concerning its audit of the Company's internal control over financial reporting as required by the Public Company Accounting Oversight Board Auditing Standard No. 2201.
Based on these reviews, activities and discussions, the Audit Committee recommended to the Board of Directors, and the Board of Directors has approved, that the Company's audited financial statements be included in the Company's Annual Report on Form 10-Kfor fiscal 2024.
THE AUDIT COMMITTEE |
Kurt P. Kuehn, Chairperson Carole T. Faig Philip A. Laskawy Anne H. Margulies |
79
Notwithstanding anything to the contrary set forth in any of our previous or future filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, that might incorporate by reference this proxy statement or future filings made by the Company under those statutes, the Compensation Committee Report, the information in the Report of the Audit Committee of the Board of Directors contained under the heading "Review of the Company's Audited Financial Statements for Fiscal 2024," references to the Audit Committee Charter and reference to the independence of the Audit Committee members are not deemed filed with the SEC, are not deemed soliciting material and shall not be deemed incorporated by reference into any of those prior filings or into any future filings made by the Company under those statutes, except to the extent that the Company specifically incorporates such information by reference into a previous or future filing, or specifically requests that such information be treated as soliciting material, in each case under those statutes.
VOTING OF PROXIES AND OTHER MATTERS
The Board of Directors recommends an affirmative vote be cast "FOR" all nominees for election to the Board of Directors listed in Proposals 1, 2 and 3 on the proxy card and a vote "FOR" Proposals 4 and 5.
The Board of Directors knows of no other matter that may be brought before the meeting that requires submission to a vote of the stockholders. If any other matters are properly brought before the meeting, however, the persons named in the enclosed proxy or their substitutes will vote in accordance with their best judgment on such matters.
A complete list of stockholders entitled to vote at the Annual Meeting will be available for inspection beginning May 12, 2025 at the Company's principal place of business. If a state of emergency exists at that time preventing access to the Company's office during regular business hours, the Company will endeavor to make the list available for inspection upon request via email to investor@henryschein.com. The list of stockholders will be available electronically during the virtual Annual Meeting at www.virtualshareholdermeeting.com/HSIC2025.
ANNUAL REPORT ON FORM 10-K
Our Annual Report on Form 10-Kfor the fiscal year ended December 28, 2024 has been filed with the SEC and is available free of charge through our Internet website, www.henryschein.com. Stockholders may also obtain a copy of the Form 10-Kupon request via email to investor@henryschein.com. In response to such request, the Company will furnish without charge the Form 10-Kincluding financial statements, financial schedules and a list of exhibits.
STOCKHOLDER PROPOSALS
Eligible stockholders wishing to have a proposal for action by the stockholders at the 2026 Annual Meeting included in our proxy statement pursuant to the SEC's proxy rules (i.e., Rule 14a-8)must submit such proposal at the principal executive offices of the Company no later than December 10, 2025. It is suggested that any such proposals be submitted by email and certified mail, retureceipt requested.
Any stockholder intending to include a director nominee in the Company's proxy materials for the 2026 Annual Meeting pursuant to Article II, Section 12 of our Fourth Amended and Restated By-laws(i.e., proxy access) should carefully review the requirements for using proxy access, as described in such Section. The Company must receive a stockholder's nomination, with all required information, between the close of business on November 10, 2025 and the close of business on December 10, 2025.
Under our Fourth Amended and Restated By-laws,a stockholder who intends to bring a proposal before the 2026 Annual Meeting outside of Rule 14a-8cannot do so unless notice and a full description of such proposal (including all information that would be required in connection with such proposal under the SEC's proxy rules if such proposal were the subject of a proxy solicitation and the written consent of each nominee for election to the Board of Directors named therein (if any) to serve if elected), the name, address and number of shares of common stock held of record or beneficially as of the record date for such meeting and as of the date of such notice by the person proposing to bring such proposal before the 2026 Annual Meeting and all other required information is delivered in person or mailed to, and received by, the Company at our principal executive offices between the close of business on January 22, 2026 and the close of business on February 21, 2026.
80
In addition to satisfying the requirements noted above, if a stockholder intends to comply with the SEC's universal proxy rules and to solicit proxies in support of director nominees other than the Company's nominees at the 2026 Annual Meeting, the stockholder must provide notice that includes the information required by Rule 14a-19 underthe Exchange Act and required by the Company's Fourth Amended and Restated By-laws,which notice must be delivered in person or mailed to, and received by, the Company at our principal executive offices between the close of business on January 22, 2026 and the close of business on February 21, 2026.
If the date of the 2026 Annual Meeting is changed by more than 30 calendar days from such anniversary date, however, then the stockholder must provide notice by the later of 60 calendar days prior to the date of the 2026 Annual Meeting and the 10th calendar day following the date on which public announcement of the date of the 2026 Annual Meeting is first made.
Under the SEC's proxy rules, proxies solicited by the Board of Directors for the 2026 Annual Meeting may be voted at the discretion of the persons named in such proxies (or their substitutes) with respect to any stockholder proposal not included in our proxy statement if we do not receive notice of such proposal on or before the deadline set forth in the preceding paragraph.
81
HENRY SCHEIN, INC. 135 DURYEA ROAD, MAIL STOP E-365 MELVILLE, NY 11747 |
VOTE BY INTERNET Before The Meeting- Go to www.proxyvote.comor scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. EasteDaylight Time on May 21, 2025. 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. During The Meeting - Go to www.virtualshareholdermeeting.com/HSIC2025 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. EasteDaylight Time on May 21, 2025. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and retuit in the postage-paid envelope we have provided or retuit to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: |
||
V70217-P29723 KEEP THIS PORTION FOR YOUR RECORDS |
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - | ||
DETACH AND RETURN THIS PORTION ONLY | ||
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. |
HENRY SCHEIN, INC. |
||||||||||||||
The Board of Directors recommends you vote FOR the following: | ||||||||||||||
1. Election of Incumbent Directors Nominees: |
For | Against | Abstain | |||||||||||
1a. |
Mohamad Ali |
☐ |
☐ |
☐ |
||||||||||
1b. |
Stanley M. Bergman |
☐ | ☐ | ☐ | ||||||||||
1c. |
Deborah Derby |
☐ | ☐ | ☐ | ||||||||||
1d. |
Carole T. Faig |
☐ | ☐ | ☐ | ||||||||||
1e. |
Joseph L. Herring |
☐ | ☐ | ☐ | ||||||||||
1f. |
Robert J. Hombach |
☐ | ☐ | ☐ | ||||||||||
1g. |
Kurt P. Kuehn |
☐ | ☐ | ☐ | ||||||||||
1h. |
Philip A. Laskawy |
☐ | ☐ | ☐ | ||||||||||
1i. |
Anne H. Margulies |
☐ | ☐ | ☐ | ||||||||||
1j. |
Scott Serota |
☐ | ☐ | ☐ |
For | Against | Abstain | ||||||||||
1k. Bradley T. Sheares, Ph.D. | ☐ | ☐ | ☐ | |||||||||
1l. Reed V. Tuckson, M.D., FACP | ☐ | ☐ | ☐ | |||||||||
The Board of Directors recommends you vote FOR proposals 2, 3, 4 and 5. | For | Against | Abstain | |||||||||
2. |
Election of Max Lin as a director, provided certain conditions are satisfied. |
☐ | ☐ | ☐ | ||||||||
3. |
Election of William K. "Dan" Daniel as a director, provided certain conditions are satisfied. |
☐ | ☐ | ☐ | ||||||||
4. |
Proposal to approve, by non-bindingvote, the 2024 compensation paid to the Company's Named Executive Officers. |
☐ | ☐ | ☐ | ||||||||
5. |
Proposal to ratify the selection of BDO USA, P.C. as the Company's independent registered public accounting firm for the fiscal year ending December 27, 2025. |
☐ | ☐ | ☐ | ||||||||
NOTE: Such other business as may properly come before the meeting or any adjournments or postponements 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] |
Date | Signature (Joint Owners) | Date |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Combined Document, Notice and Proxy Statement are available at www.proxyvote.com.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - -
V70218-P29723
HENRY SCHEIN, INC.
135 Duryea Road, Melville, New York 11747
This proxy is solicited on behalf of the Board of Directors
The undersigned, having duly received the Notice of Annual Meeting of Stockholders and the Proxy Statement, hereby appoints Stanley M. Bergman and Michael S. Ettinger as proxies, each with the power to act alone and with the power of substitution and revocation, to represent the undersigned and to vote, as designated on the other side, all shares of common stock of Henry Schein, Inc. held of record by the undersigned on March 24, 2025, at the Annual Meeting of Stockholders to be virtually held at 10:30 a.m. EDT on Thursday, May 22, 2025, at www.virtualshareholdermeeting.com/HSIC2025 and at any adjournments or postponements thereof. The undersigned hereby revokes any previous proxies with respect to the matters covered by this proxy. The Board of Directors recommends a vote FOR the directors listed in Proposals 1, 2 and 3, and FOR Proposals 4 and 5 (each as listed on the reverse side).
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED ON THIS PROXY BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTORS LISTED IN PROPOSALS 1, 2 AND 3, AND FOR PROPOSALS 4 AND 5.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
Continued and to be signed on reverse side
Attachments
Disclaimer
Henry Schein Inc. published this content on April 09, 2025, and is solely responsible for the information contained herein. Distributed via EDGAR, the Electronic Data Gathering, Analysis, and Retrieval system operated by the U.S. Securities and Exchange Commission,, on April 09, 2025 at 12:01 UTC.
Helping schools meet rising cost of property insurance
Bill would ban surprise ambulance billing
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News