Company: HCKT
Filing Date: 2025-03-21
Form Type: DEF 14A
Source: 0000950170-25-043233
Chunk: 67

Company: HACKETT GROUP, INC.
Filing Date: 2025-03-21
Form: DEF 14A
Chunk 67
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 relates to the “Compensation Discussion and Analysis,” the tabular disclosures regarding named executive officer compensation and the narrative disclosures accompanying the tabular presentation. These disclosures allow you to view the Company’s executive compensation program and the application of the Company’s compensation philosophies for the years presented. This advisory vote will be presented on an annual basis unless otherwise disclosed.

The Company’s primary objectives relating to executive compensation are to (1) align the financial interests of its executives with those of its shareholders by linking a substantial portion of each executive’s compensation to the achievement of financial objectives for the Company as a whole and (2) attract and retain highly qualified executives with salaries and incentive programs that are competitive with companies of similar or greater size within its industry.

The Company’s executive compensation programs, which focus on operating performance, earnings growth and share price appreciation, reflect the Company’s “pay for performance” approach to compensation. Annually, the Company's executives have the opportunity to earn cash payouts and equity awards based on the achievement of adjusted diluted net earnings per share growth targets specified by the Company’s Compensation Committee. Another key aspect of the executive compensation programs is that a meaningful part of total compensation is paid with performance-based restricted stock unit grants that not only requires the achievement of a performance-based target to earn the grant, but also has a three-year vesting period following the date of grant which occurs after the performance period. The vesting requirement of the equity portion of the compensation program (1) extends the value of the current year compensation program for an additional three-year period, (2) creates a strong incentive for the executives to increase shareholder value, and (3) serves as a powerful executive retention tool. This equity component is also essential to the compensation and retention of the Company’s executives since the Company does not provide retirement (pension or 401(k) match) benefits for its senior executives and offers no perquisites. Finally, the Company's CEO and COO are significant shareholders which continues to provide an incentive for the CEO and COO to focus on share value appreciation in order to maximize the benefit of the vested awards.

In 2024, for executive compensation purposes, the Company’s adjusted diluted earnings per share was $1.68, as compared to the “Goal” target of $1.71. This resulted in performance-based cash and equity bonuses above the “Commence” level payout but under the Goal level payout under the Company’s 2024 executive compensation program. Please refer to Appendix A, “Reconciliation of Reported (GAAP) to Adjust