Company: PAYX
Filing Date: 2025-08-29
Form Type: DEF 14A
Source: 0001193125-25-191789
Chunk: 46

Company: PAYCHEX INC
Filing Date: 2025-08-29
Form: DEF 14A
Chunk 46
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ayout may range from 0% to 150% of the target. 2024-2027 Performance Stock Awards Our performance stock awards are designed to provide variable compensation that is focused on longer-term results. The performance-based RSUs granted in fiscal 2025 (other than those granted to Mr. Ante, who joined the Company in April 2025) have a three-year performance period (which we extended to be longer than the two-yearperformance period used in previous years), and may be earned based on the sustained year-over-year growth in service revenue and operating income (equally weighted), net of certain items compared to performance targets, subject to a downward or upward adjustment of 25% based on relative TSR. Payout may range from 0% to 200% of target. The C&L Committee establishes performance targets intended to be appropriately challenging at all levels, including the threshold level, but attainable with increasing difficulty for each level beyond threshold. The threshold level was expected to be appropriately challenging but achievable under normal circumstances. The target level would be achieved if the Company performed as expected under our strategic plan for the three-year period. The maximum level would be achievable only with exceptional performance. Operating income, net of certain items, is a non-GAAPmeasure. Refer to “Paychex, Inc. Non-GAAPFinancial Measures” in Appendix A of this proxy statement for a discussion of this non-GAAPmeasure and a reconciliation to the most comparable GAAP measure of operating income. The goals are set by the C&L Committee upfront for the entire performance period.The threshold, target, and maximum growth rates for service revenue and operating income, net of certain items for each of the three years in the performance period are determined as percentage increases over the actual results from the prior year. As a result, payouts for the second and third year of the performance period require sustained growth over the three-year period. Because growth rates are calculated separately for each year in the performance period and are not aggregated over the three-year performance period, the plan allows for a long-term growth goal while recalibrating to actual performance on an annual basis. Paychex, Inc. 2025 Proxy Statement •41

| CD&A |

The relative TSR metric modifies the final payout downward or upward by up to 25% based on the Company’s three-year TSR performance versus the S&P 500. The S&P 500 consists of a broad group of companies that represents investors’ alternative capital investment opportunities, thereby aligning the performance-based RSU