UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549​

SCHEDULE 14A​

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.      )

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

☐

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 under §240.14a-12

​

Oshkosh Corporation

(Name of Registrant as Specified In Its Charter)​

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)​

Payment of Filing Fee (Check the appropriate box):

☒

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.

​

   

   

 

Dear Fellow Oshkosh Corporation Shareholder

March 17, 2023

In 2022, the company persevered and weathered persistent supply chain disruptions, inflationary headwinds and a tight labor market. Pricing discipline, cost optimization efforts and hard work led to meaningful improvements in operating margins throughout the year. We ended the year with a record $14 billion backlog, demonstrating strong market demand for Oshkosh’s industry leading products and technology.

Oshkosh continued to invest in technology for its next-generation products in the areas of electrification, autonomy and active safety, intelligent and connected products, and advanced mobility. Demonstrating the company’s ability to deliver technology and solutions for our customers, the United States Postal Service placed an initial order in 2022 for the delivery of 50,000 Next Generation Delivery Vehicles worth nearly $3 billion, and recently expressed their intention to increase the initial order to 60,000 with 75% being battery electric vehicles.

To advance the company’s commitment to programmatic acquisitions, Oshkosh acquired Maxi-Métal Inc. and entered into a definitive agreement to acquire Hinowa S.p.A. in 2022. Maxi-Métal further expands the sales and distribution reach of Oshkosh’s Vocational segment in Canada. Hinowa is well-known for its advanced track designs and electrification expertise as an early adopter and leader in lithium-ion battery technology. Hinowa has produced JLG® compact crawler boom lifts since 2010, including electric, hybrid and diesel-powered models.

In 2022, Oshkosh is honored to have been named one of Fortune’s Most Admired Companies and one of the Ethisphere Institute’s World’s Most Ethical Companies for the fifth and seventh times, respectively. We were also named to the Dow Jones Sustainability World Index for the fourth consecutive year and received numerous other accolades for our sustainability, ethics, diversity and inclusion and technology.

With a record backlog and strong market fundamentals, we expect meaningful growth in 2023 and beyond. We believe Oshkosh’s commitment to attracting, retaining and developing diverse talent, our strong balance sheet and our investments in capacity and technology for future products have positioned us to deliver strong shareholder value.

On behalf of the Board and our approximately 15,000 Oshkosh Corporation team members, thank you for your continued support of, and confidence in, Oshkosh Corporation.

Sincerely,

 

OSHKOSH CORPORATION | 2023 PROXY STATEMENT

 

 

OSHKOSH CORPORATION | 2023 PROXY STATEMENT

 

Table of Contents

 

OSHKOSH CORPORATION | 2023 PROXY STATEMENT

 

 

OSHKOSH CORPORATION | 2023 PROXY STATEMENT

Proxy Statement Summary

To assist you in reviewing the proposals to be considered at the Annual Meeting, we call your attention to the following summary, which includes information about our fiscal 2022 financial performance. For more complete information, please review our 2022 Annual Report on Form 10-K and this entire Proxy Statement.

Voting matters and recommendations

The following proposals are scheduled to be presented at the upcoming 2023 Annual Shareholders’ Meeting:

OSHKOSH STRENGTHS, STRATEGY AND FISCAL 2022 HIGHLIGHTS

Oshkosh Corporation (Oshkosh) is an industrial technology company and manufacturer of purpose-built vehicles and equipment. We are driven by our powerful purpose: making a difference in people’s lives. Our many strengths contribute to our positive outlook and support our plans to grow revenue, operating income and return on invested capital (ROIC). These strengths include:

•

Leading market positions for our products and services.

​

•

Favorable market dynamics signaling increased demand for our products.

​

•

Opportunities for organic and inorganic growth supported by our M & A strategy.

​

•

Disciplined capital allocation designed to balance our investments and deliver shareholder value.

​

At the Oshkosh’s Investor Day in May, we detailed our Innovate. Serve. Advance. strategy and shared our outlook for growth. We continue our legacy of innovation by making the investments in people, capacity and technology to position Oshkosh to achieve our 2025 growth targets for revenues, operating income margins and ROIC.

Oshkosh worked through ongoing supply chain disruptions and persistent inflation in 2022 to grow revenues during the year. We made significant progress combatting inflationary pressures and supply chain disruptions. Dual sourcing, re-sourcing and redesigning products to take advantage of more readily available parts enabled our company to improve operating results as the year progressed, providing important momentum as we exited 2022. Oshkosh more than doubled consolidated operating income from the first half of the year to the second half of the year and remains focused on optimizing our global operations and advancing innovation to support customers as we drive long-term growth and create shareholder value.

 

Proxy Statement Summary

Highlights for Fiscal 2022 Include:

•

Secured strong orders to support a record year-end backlog of  $14 billion.

​

•

Introduced the eJLTV, broadening our advanced electric and hybrid-electric product offerings for the U.S. Army and Marines.

​

•

Demonstrated the Striker® Volterra™ electric Aircraft Rescue and Firefighting (ARFF) vehicle at airports across Europe with outstanding response from airport authorities.

​

•

Secured the first order from the United States Postal Service (USPS) to supply 50,000 Next Generation Delivery Vehicles (NGDVs), including a combination of zero emission battery electric vehicles (BEV) and low emission internal combustion engine (ICE) vehicles. Since this order, the USPS has announced intentions to increase the order to 60,000 units and at a 75% mix of BEV units for delivery by 2028.

​

•

Delivered the first seven upgraded Stryker Medium Caliber Weapon Systems (MCWS) to the U.S. Department of Defense (DoD).

​

•

Completed strategic bolt-on acquisitions of CartSeeker, a curbside automation technology for refuse collection vehicles,and Maxi-Métal, a Canadian fire apparatus manufacturer,while also entering into a definitive agreement to acquire Hinowa, an Italian manufacturer of access and vegetation management equipment.

​

•

Made several key leadership and governance additions: appointed General (Ret.) David G. Perkins to our Board of Directors; added Jay Iyengar as our Executive Vice President, Chief Technology & Strategic Sourcing Officer and promoted Timothy Bleck to Senior Vice President and President of our Defense segment.

​

•

Invested in manufacturing capability; added capacity in two businesses and introduced Industry 4.0 technologies in several factories.

​

•

Hired 2,350 production team members.

​

•

Made notable investments in technology focus areas including electrification, autonomy and active safety, intelligent and connected products, advanced analytics and digital manufacturing.

​

•

Announced long-term financial and environmental, social and governance (ESG) targets at our May Investor Day.

​

•

Achieved a top tier AAA rating from MSCI, a result of our leadership in sustainability and workplace culture.

​

•

Named to the Dow Jones Sustainability World Index for the fourth consecutive year.

​

•

Launched a monthly pulse team member experience survey to continuously hear the voice of our team.

​

•

Committed to establish science-based targets to support a lower carbon future.

​

•

Began earning energy credits from our investment in a Caddo, Oklahoma wind farm as part of our Virtual Power Purchase Agreement to support lower greenhouse gas (GHG) emissions.

​

The company delivered revenues of  $8.28 billion, a 4.1% increase versus the year ended December 31, 2021, and operating income of  $372.3 million, a decrease of 30.4% versus the year ended December 31, 2021. These results led to cash flow from operations of more than $600 million. Revenue, operating income and earnings per share performance for the past three years are shown below. We maintain a positive long-term outlook based on strong sector-specific market fundamentals, a record year-end backlog and a comprehensive offering of innovative new products.

Results for the years ended December 31, 2020 and 2021 are unaudited.

 

Proxy Statement Summary

Returning cash to shareholders continues to be a key component of our responsible capital allocation strategy. In fiscal 2022, we returned $252.3 million of cash to shareholders through a combination of dividends and share repurchases, including cash dividends totaling $97.3 million.

Additionally, we announced an 11% increase in our quarterly dividend rate from $0.37 to $0.41 per share on January 31, 2023. This marks our ninth straight year of double-digit percentage increases in the company’s dividend rate and reflects the confidence we have in our business model and our longer-term outlook.

HUMAN CAPITAL MANAGEMENT AND SUSTAINABILITY

Oshkosh fosters a People First culture that values diversity, equity and inclusion. We invest in programs to enable the engagement, safety, wellbeing and development of our team members.

Workforce Demographics. As of December 31, 2022, Oshkosh had approximately 15,000 team members, approximately 9,000 of whom were production team members. 2,300 of these team members were located outside the United States.

Our People First Culture. We believe in putting people first, which means caring for our team members, customers and communities and building a company that understands that prioritizing people will enable us to deliver our strategy of Innovate. Serve. Advance. Our strategy is grounded in our purpose — making a difference in people’s lives.

Diversity, Equity and Inclusion (DE&I). DE&I is integral to our People First Culture and the company is driving proactive programs to improve its diverse employee representation. We believe that an inclusive and diverse workplace is critical to our strategy. In fiscal 2022, we made meaningful progress toward our diversity goals. We set a goal that 50% of all U.S. non-production new hires would be diverse. During fiscal 2022, 49% of our external hires were diverse, a 1% increase compared to fiscal 2021. We also set goals to advance women and black, indigenous and people of color (BIPOC) representation in our positions graded at director level and above to 30% female and 15% BIPOC by 2026. In an effort to increase transparency, we published our diverse representation in our 2021 Sustainability Report, in addition to publishing our 2021 EEO-1 on our website. We have seven Employee Business Resource Groups, which have continued to gain momentum. Our Diversity Council, which is sponsored by our CEO and has representation from across the company, enabled the advancement of our DE&I programs enterprise-wide.

Communication and Engagement. Engaging, connecting with and developing team members is a central focus of our People First culture. We communicate regularly through town halls, newsletters and team-building events. In fiscal 2022, we launched a new engagement survey platform and methodology, which allowed us to collect engagement information on a monthly basis for our professional workforce and annually for our production workforce. This has allowed us to respond dynamically to our team member feedback and make improvements. Our passion for serving our community continued with our Oshkosh team donating over 18,200 volunteer hours to local charities.

In fiscal 2022, the company was named one of the World’s Most Ethical Companies by Ethisphere for the seventh consecutive year and was one of only seven honorees in the industrial manufacturing category.

Workplace Safety, Health and Wellbeing. We are committed to the safety, security and wellbeing of our team members. The company continues to maintain a safe working environment by proactively reducing risks that may result in injuries and hardship for our team members. Each year, we establish a year over year goal to reduce our recordable incident rate by 10%. In fiscal 2022 we successfully achieved that goal with an incident rate of 2.10. At Oshkosh, we also offer a comprehensive benefits package which includes a number of programs to ensure that our team members and their families have opportunities to enhance their wellbeing.

Growth and Development. Our ability to attract, develop and retain world-class talent is critical to our business strategy. In fiscal 2022, we hosted a series of executive leadership development events that were both held in person and virtually. More than 350 global leaders completed over 2,000 hours of learning on topics including DE&I, megatrends, data analytics and innovation. Our enterprise Learning Management System was expanded to provide all global team members with access to learning content on our technology platform in addition to expanding our online learning curriculum. As a company, over 74,000 learning hours were logged by our team members in fiscal 2022.

Sustainability. We are proud to be a leader in sustainable business practices. We were recently named to the Dow Jones Sustainability World Index for the fourth consecutive year. We have received numerous awards and recognition for being a leader in ESG practices and encourage you to read more about our commitment to the environment as well as our responsible business practices in our Oshkosh Corporation Sustainability Report. We are not including the information contained in that report as a part of, or incorporating it by reference into, this Proxy Statement.

 

Proxy Statement Summary

SHAREHOLDER ENGAGEMENT

We are proud of our frequent and active shareholder engagement. In fiscal 2022, the investment community returned to in-person meetings as the pandemic waned. In May, we hosted an Investor Day at the New York Stock Exchange where company leaders shared our strategy, program updates and long-term targets. We continued investor outreach throughout the year by participating in investor conferences and investor meetings. A summary of recent in-person and virtual outreach is listed below:

✓

participated in 10 investor conferences

​

✓

hosted five investor visits to Oshkosh facilities

​

✓

hosted over 500 in person and virtual attendees at our Investor Day

​

✓

conducted an in-depth investor perception study with 37 investors

​

✓

held several discussions with investors at tradeshows and other events

​

✓

conducted more than 360 total company discussions with shareholders and potential shareholders

​

Our team uses a purposeful and deliberate approach to build better lines of communication between investors and management.

As we continue our efforts to build and strengthen our relationships with the investment community, we encourage you to contact us via any of the methods below:

 

Proxy Statement Summary

Transition to Calendar Year for Fiscal 2022

As previously announced, the company transitioned to a calendar year fiscal year beginning January 1, 2022 to better align our planning and reporting activities with those of our customers and suppliers. In this Proxy Statement, we refer to the fiscal year ended September 30, 2021 as “fiscal 2021”, the period from October 1, 2021 to December 31, 2021 as the “Transition Period” and the year January 1, 2022 to December 31, 2022 as “fiscal 2022”.

Forward-Looking Statements

This Proxy Statement contains statements that the company believes to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including, without limitation, statements regarding the company’s future financial position, business strategy, targets, projected sales, costs, earnings, capital expenditures, debt levels and cash flows, and plans and objectives of management for future operations, are forward-looking statements. When used in this Proxy Statement, words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “project” or “plan” or the negative thereof or variations thereon or similar terminology are generally intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond the company’s control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the extent of supply chain and logistics disruptions; the company’s ability to increase prices or impose surcharges to raise margins or to offset higher input costs, including increased raw material, labor, freight and overhead costs; the company’s ability to attract and retain production labor in a timely manner; the cyclical nature of the company’s access equipment, commercial and fire & emergency markets, which are particularly impacted by the strength of U.S. and European economies and construction seasons; the company’s estimates of access equipment demand which, among other factors, is influenced by historical customer buying patterns and rental company fleet replacement strategies; the strength of the U.S. dollar and its impact on company exports, translation of foreign sales and the cost of purchased materials; the company’s ability to predict the level and timing of orders for indefinite delivery/indefinite quantity contracts with the U.S. federal government; the impact of any U.S. Department of Defense solicitation for competition for future contracts to produce military vehicles; the impacts of orders from the U.S. Postal Service; the impact of severe weather, war, natural disasters or pandemics that may affect the company, its suppliers or its customers; risks related to the collectability of receivables, particularly for those businesses with exposure to construction markets; the cost of any warranty campaigns related to the company’s products; risks associated with international operations and sales, including compliance with the Foreign Corrupt Practices Act; risks that a trade war and related tariffs could reduce the competitiveness of the company’s products; the company’s ability to comply with complex laws and regulations applicable to U.S. government contractors; cybersecurity risks and costs of defending against, mitigating and responding to data security threats and breaches impacting the company; the company’s ability to successfully identify, complete and integrate acquisitions and to realize the anticipated benefits associated with the same; and risks related to the company’s ability to successfully execute on its strategic road map and meet its long-term financial goals. Additional information concerning these and other factors is contained in the company’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K filed on February 21, 2023. All forward-looking statements speak only as of the date of this document. The company assumes no obligation, and disclaims any obligation, to update information contained in this document. Investors should be aware that the company may not update such information until the company’s next quarterly earnings conference call, if at all.

 

Proposal 1

ELECTION OF DIRECTORS

Background to Board’s Recommendation for Director Nominees

Board composition, refreshment and diversity are priorities for our shareholders as well as for our Board. Our Board seeks to provide orderly refreshment while sustaining strong board composition and diversity. We define diversity broadly. In considering diversity (in all aspects of that term), our Board takes into account various factors and perspectives, including differences of viewpoint, professional experience, education, skill and other demographics, such as race, gender and ethnicity. Our Board continues to review both its size and its composition to attract outstanding candidates while retaining the balance of skills and attributes needed to oversee our company’s complex, global operations.

On May 3, 2022, the Board of Directors increased the size of the Board from nine to ten members and elected General (Ret.) David G. Perkins as an independent director.

Attributes, Qualifications and Experience of Nominees for Board of Directors

Our Board defines the personal and professional qualifications that nominees must demonstrate. These criteria are described in the Policies and Guidelines section on the Investors page under the “Governance” tab located on our website, www.oshkoshcorp.com, and on pages 17 to 23 of this Proxy Statement. We are not including the information contained on our website as part of, or incorporating it by reference into, this Proxy Statement.

In addition to the brief biographies of each of our Board’s nominees presented on pages 9 to 13, below is a summary of the nominees’ attributes, qualifications and experience and knowledge that led our Board of Directors to conclude that each nominee should continue to serve as a director.

OVERVIEW OF OUR BOARD NOMINEES

If for some reason a nominee is unable to serve, the individuals named as proxies may vote for a substitute nominee recommended by the Board, and unless you indicate otherwise when voting, your shares will be voted in favor of our remaining nominees.

 

Proposal 1   |   ELECTION OF DIRECTORS

SUMMARY OF ATTRIBUTES OF NOMINEES

   Denotes public company CEO experience​

   Denotes public company CFO experience​

 

Proposal 1   |   ELECTION OF DIRECTORS

CURRENT COMMITTEE MEMBERSHIPS

(1) General (Ret.) David G. Perkins was appointed to the Governance Committee on May 3, 2022.

 

Proposal 1   |   ELECTION OF DIRECTORS

 

Proposal 1   |   ELECTION OF DIRECTORS

 

Proposal 1   |   ELECTION OF DIRECTORS

 

Proposal 1   |   ELECTION OF DIRECTORS

 

Proposal 1   |   ELECTION OF DIRECTORS

 

Proposal 1   |   ELECTION OF DIRECTORS

Board Recommendation

The Board recommends that shareholders vote FOR the election of the ten nominees identified above. The Board’s recommendation is based on carefully considered judgment that the skills, professional experience, education, backgrounds and attributes of the nominees make them the best candidates to serve on our Board.

 

Director Compensation

The table below summarizes the compensation paid to or earned by our non-employee directors during fiscal 2022 and the Transition Period.

(1)

Mr. Pfeifer did not receive additional compensation for service on our Board of Directors. The compensation Mr. Pfeifer received as our Chief Executive Officer during and for fiscal 2022 and the Transition Period is shown in the Summary Compensation Table on page 46.

​

(2)

As SEC rules require, amounts in this column are based on the aggregate grant date fair value of awards to our directors under our 2017 Incentive Stock and Awards Plan. The amounts shown are not actual cash amounts paid to the directors or amounts the directors realized or will realize because of these awards. We computed the aggregate grant date fair value of these awards in accordance with FASB ASC Topic 718, based on the market price of the shares awarded on the date of grant. This amount includes the value of dividends that the holder of shares is entitled to receive prior to vesting.

​

(3)

As of December 31, 2022, no current non-employee director held any stock options.

​

(4)

The amounts in this column represent above-market interest on non-qualified deferred compensation computed on a quarter-by-quarter basis. The above-market interest rate is the percentage amount by which the interest rate earned on

​

 

Director Compensation

deferred compensation in the Transition Period and fiscal 2022 exceeded 120% of the applicable federal long-term interest rate, with compounding, at the time the interest rate was set. The annual interest rate earned on deferred compensation for the Transition Period was 4.25%, while for the same period, 120% of the applicable long-term interest rate was 2.26%. The annual interest rate earned on deferred compensation for the first quarter of fiscal 2022 was 4.25%, the second quarter was 4.50%, the third quarter was 5.75%, and the fourth quarter was 7.25%. For the same periods, 120% of the applicable long-term interest rate was 2.55%, 3.69%, 3.72%, and 5.12%, respectively.

(5)

General (Ret.) Raymond T. Odierno served as a director until his passing on October 8, 2021.

​

(6)

Mr. Omtvedt retired from our Board effective as of the conclusion of the 2022 Annual Meeting.

​

(7)

General (Ret.) David G. Perkins was appointed to the Board effective May 3, 2022.

​

Retainer and Meeting Fees

Each non-employee director is entitled to receive an annual retainer of  $97,500. The Chairman of the Board is entitled to receive an additional retainer of  $170,000 in recognition of this position. Directors receive a fee of  $13,500 per calendar year for each committee on which they serve. The Chairpersons of the Governance Committee and the Human Resources Committee each receive an additional annual retainer of  $15,000, and the Chairperson of the Audit Committee receives an additional annual retainer of  $20,000. We also reimburse directors for reasonable travel and related expenses they incur attending Board and Board committee meetings and continuing education programs.

Stock Awards

We generally grant shares of stock to our non-employee directors at the meeting of our Board held on the date of our Annual Meeting of Shareholders or at the time a director joins our Board. Effective on election at our 2022 Annual Meeting, we granted to each of our then non-employee directors 1,350 shares of our common stock under the Oshkosh Corporation 2017 Incentive Stock and Awards Plan. The Human Resources Committee retained the services of Mercer, an external compensation consultant, to advise regarding compensation of outside directors, and the amount of the stock awards was at the 50th percentile of data that Mercer provided relating to non-employee director compensation. That data reflected Mercer’s Global Disclosure Database focusing on 90 publicly-traded companies with annual revenues ranging from $6 billion to $10 billion.

Deferred Compensation Plan

Non-employee directors may elect to participate in our Deferred Compensation Plan for Directors and Executive Officers. This plan permits individual directors to defer any or all of their compensation from the company, including their stock awards. A director who defers fees may elect to have deferred amounts credited to a fixed-income investment account or a stock account. Deferrals of stock awards must be credited to a stock account. Deferrals credited to a fixed-income investment account earn interest at the prime rate as published in The Wall Street Journal on the last business day of the immediately preceding quarter, plus 1%. Deferrals credited to a stock account are treated as though invested in our common stock. Any dividends earned on our common stock are reinvested in each director’s stock account. Payments from the Deferred Compensation Plan may be made in a lump sum or in annual installments for up to 10 years at the election of the director.

Payments generally commence when a director ceases to be a member of our Board. In the event of a change-in-control of our company, as defined in the Deferred Compensation Plan, we will pay out the deferred compensation plan accounts of all directors in a single lump-sum cash payment.

Stock Ownership Guidelines for Directors

The Human Resources Committee has adopted stock ownership guidelines for non-employee directors to ensure they have a direct stake in the success of our company. Under these guidelines, non-employee directors are encouraged to acquire and own our common stock in an amount equal to five times their respective annual cash retainers. Non-employee directors should achieve this stock ownership level within five years of becoming a director.

As of February 28, 2023, all independent directors have met the requisite stock ownership levels or are within five years of their initial election as a director. Mr. Pfeifer is subject to the stock ownership guidelines that apply to our executive officers.

Our company has a policy that prohibits directors, officers, and all other employees from entering certain transactions for their individual accounts, including hedging or pledging our common stock. Without limitation, the prohibition on hedging includes any financial instruments or other transactions that hedge or offset, or are designed to hedge or offset, any position relating to company securities, including prepaid variable forward contracts, equity swaps, collars, puts, calls and other derivative instruments and exchange funds.

 

Governance of the Company

Board of Directors Independence

Except for our President and Chief Executive Officer, Mr. Pfeifer, all of the nominees for election to our Board are independent. The Board has determined that no non-employee director nominee has a material relationship with our company and that all are independent under NYSE listing standards. Further, no director or executive officer has any family relationship with any other director or executive officer.

Meetings of the Board of Directors

The Board of Directors held six meetings during fiscal 2022, and committees of the Board held a total of 15 meetings. Each director attended well above 75% of the aggregate number of meetings of the Board and committees on which he or she served during fiscal 2022.

The Board expects directors to attend the Annual Meeting of Shareholders. All our directors attended our 2022 virtual Annual Meeting, and we anticipate that all director nominees will attend the virtual Annual Meeting in 2023.

Our independent, non-employee directors met in executive session, without the presence of our officers, on six occasions during fiscal 2022. The independent Chairman of the Board presided over all executive session meetings of the non-employee directors.

Shareholder Engagement and Say-on-Pay

Our shareholders are key participants in the governance of our company. For this reason, we spend time meeting with our shareholders, listening to their concerns and responding to their feedback. During fiscal 2022, members of the management team met with shareholders and potential shareholders on many occasions. Our management also proactively reached out to shareholders following each of our four quarterly earnings releases. During these candid meetings, we discussed our company’s performance and strategy and heard shareholder feedback on a variety of topics.

We know that executive compensation is an important subject for shareholders. The Board is particularly pleased that, at our 2022 Annual Meeting, 95.2% of the votes cast were in favor of the advisory proposal to approve the compensation of our named executive officers.

Form of Majority Voting for Director Elections

We have a form of majority voting for directors. Directors are elected through plurality voting, which means that the ten nominees who receive the most votes of all votes cast will be elected. However, in the absence of a contested election, any nominee for director who receives a greater number of votes “withheld” from his or her election than votes “for” such election must promptly tender a resignation to the Chairman of the Board. The Governance Committee (or, under certain circumstances, another committee appointed by the Board) will promptly consider the matter and will recommend to the Board whether to accept or reject the tendered resignation based on all relevant factors.

The Board must act on that recommendation no later than 90 days after the annual meeting of shareholders at which the election took place. The Board’s decision, including a full explanation of the process by which the decision was reached and, if applicable, the reasons for rejecting the resignation, will be disclosed in a Current Report on Form 8-K filed with the SEC.

Proxy Access

Our By-laws include a proxy access provision stating that shareholders who meet the requirements set forth in our By-laws may under certain circumstances include a specified number of director nominees in our proxy materials. Under the provision, any shareholder or group of up to 20 shareholders that beneficially owns at least 3% of our outstanding common stock continuously for three years is permitted to nominate candidates for election to the Board and to require the company to list such nominees along with the Board’s nominees in the company’s proxy statement. For purposes of this limitation, a group of funds under

 

Governance of the Company

common management and investment control is treated as one shareholder. The qualifying shareholder or group of shareholders may nominate up to 20% of the Board, rounding down to the nearest whole number of Board seats, but not less than two.

Communicating with the Board of Directors

We encourage you to share your opinions, interests, concerns and suggestions. If you would like to communicate with the Chairman or with the Board as a whole, you may send correspondence to the Secretary, Oshkosh Corporation, 1917 Four Wheel Drive, Oshkosh, Wisconsin 54902. Your correspondence will be forwarded to the Board or the appropriate committee, as applicable.

Shareholder Right to Call a Special Meeting

Under Wisconsin law and our By-laws, shareholders holding 10% of our outstanding shares have the right to call a special meeting of our shareholders. As to this right, there are no restrictions on agenda items, no restrictions on the number of shareholders who can group together to reach the 10% threshold and no limits on when a meeting can be called. Our By-laws include some procedural requirements relating to the exercise of this right.

Committees of the Board of Directors

Our Board of Directors has three standing committees: the Audit Committee, the Governance Committee and the Human Resources Committee. The members and responsibilities of these committees as of the date of the Notice of Annual Meeting of Shareholders are set forth below. The Board has determined that each member of each committee is an independent director as defined under NYSE listing standards and SEC rules, including rules specifically pertaining to members of audit committees and compensation committees.

Audit Committee

The Audit Committee met seven times during fiscal 2022.

The Audit Committee has a charter that specifies its responsibilities, and the Audit Committee believes it fulfills that charter. All members of the Audit Committee are independent directors and financially literate under the applicable NYSE listing standards, and the Board has determined that each of Tyrone M. Jordan, Stephen D. Newlin, Duncan J. Palmer and Sandra E. Rowland is an “audit committee financial expert” as defined under SEC rules.

Our independent registered public accounting firm and internal auditors met with the Audit Committee with and without representatives of management present.

 

Governance of the Company

Governance Committee

Craig P. Omtvedt served on the Governance Committee until he retired from our Board effective as of the conclusion of the 2022 Annual Meeting.

General (Ret.) David G. Perkins was appointed to the Governance Committee on May 3, 2022.

The Governance Committee met four times during fiscal 2022.

Selection of Nominees for Election to the Board and Consideration of Shareholder-Recommended Candidates

The Governance Committee will consider candidates for nomination as a director recommended by shareholders, directors, officers, third-party search firms, and other sources and reviews all candidates in the same manner, regardless of the source of the recommendation. In fiscal 2022, a third party search firm that the Committee engaged identified Mr. Perkins to the Committee as a candidate. In evaluating candidates, the Governance Committee considers the needs of the Board and attributes of the individual candidates, including character, judgment, career specialization, relevant technical skills or financial acumen, diversity of viewpoint and industry knowledge. The Board and the Governance Committee believe director candidates should possess the following minimum qualifications:

•

The highest personal and professional ethics, integrity and values;

​

•

The ability to make independent analytical inquiries and to exercise sound business judgment;

​

•

Relevant expertise and experience and an understanding of our business environment, together with the ability to offer advice and guidance to the Board and executives based on that expertise, experience and understanding;

​

•

Background as chief or other senior executive officer of a public company or leader of a major complex organization, including commercial, scientific, government, military, and educational and other non-profit institutions;

​

•

Independence from any particular constituency, ability to represent all shareholders of our company, and a commitment to enhancing long-term shareholder value; and

​

•

Sufficient time available to devote to activities of the Board and to enhance his or her knowledge of our business.

​

Unless otherwise determined by the Governance Committee, director nominees must be younger than 72. In addition, the Board and the Governance Committee believe at least one director should have the requisite experience and expertise to be designated an “audit committee financial expert” as defined by applicable SEC rules.

Any shareholder who wishes to recommend a director candidate must provide written notice to the attention of our Secretary at the address shown on page 4. Such notice must include the shareholder’s name and address; the class and number of shares of common stock owned; the name, age, business address, and principal occupation of the candidate; and the number of shares of common stock owned by the candidate, if any. The notice also must include the information that would be required to be disclosed in the solicitation of proxies for election of directors under the federal securities laws. We may require any candidate to furnish additional information, within reason, to determine the candidate’s eligibility. A shareholder wishing to nominate a candidate for election as a director also must comply with the provisions of our By-laws described under “Additional Information Regarding the Annual Meeting — Shareholders intending to present business at the 2024 Annual Meeting”.

 

Governance of the Company

Diversity on the Board

Our Corporate Governance Guidelines have long provided that our Board is committed to a diversified membership. Our Board defines diversity broadly. We look for diversity of personal attributes of the individual directors as well as their diverse careers, areas of expertise and tenure on the Board. In considering diversity of the Board (in all aspects of that term), the Governance Committee takes into account various factors and perspectives, including differences of viewpoint, professional experience, education, skills and other demographics, such as race, gender and ethnicity. As part of its process of identifying potential nominees, the Governance Committee considers the attributes of existing directors and directs the third-party executive search firm that assists in identifying candidates to search for individuals who would contribute to the diversity of the Board. As part of its annual self-evaluation, the Governance Committee assesses the effectiveness of its efforts to attain diversity by considering whether it has an appropriate process for identifying and selecting director candidates.

Human Resources Committee

Craig P. Omtvedt served on the Human Resources Committee until he retired from our Board effective as of the conclusion of the 2022 Annual Meeting.

The Human Resources Committee met four times in fiscal 2022.

The Human Resources Committee retained the services of an external independent compensation consultant, Mercer US LLC, a business of Marsh & McLennan Companies, Inc. (MMC), to provide technical guidance regarding executive and Director compensation matters. In the Transition Period and fiscal 2022, respectively, the company paid $38,659 and $247,681 in fees to Mercer for executive and director compensation consulting services which included:

•

Analysis of general industry compensation data using Mercer’s US Executive Remuneration Database and updates of trends in executive compensation;

​

•

Ongoing support regarding the latest relevant regulatory, technical and accounting considerations affecting executive compensation and benefit programs;

​

•

Guidance on overall compensation program structure, executive compensation levels, comparator groups and executive employment agreements;

​

•

Preparation for and attendance at selected management, committee and Board of Directors meetings; and

​

•

Evaluation of competitive positioning of outside director compensation.

​

The Human Resources Committee has sole authority to engage and terminate its external compensation consultant or any other compensation adviser; meet with its external compensation consultant without management being present; and evaluate the quality and objectivity of the services of its external compensation consultant annually. In addition, pursuant to SEC rules and NYSE listing standards regarding the independence of compensation committee advisers, the Human Resources Committee has the responsibility to consider the independence of its external compensation consultant.

The company separately engaged Mercer in the ordinary course of business to provide services in areas other than executive and director compensation. The services, which are described below, were unrelated to services that Mercer provided to the Committee, and the employees who rendered the services were different persons than those serving as consultants to the Committee. These additional services included:

•

Consulting services regarding investment options available under the United Kingdom employee pension scheme;

​

 

Governance of the Company

•

Administering the United Kingdom pension plan along with actuarial analysis and valuations;

​

•

Providing benchmarking surveys for information on compensation and benefits for our employees generally; and

​

•

Supporting configuration of one of the company’s global information technology platforms.

​

In the Transition Period and fiscal 2022, respectively, the company paid Mercer $259,448 and $746,641 for these additional services. United Kingdom pension services are paid in British pounds and have been converted to U.S. dollars using an average exchange rate of 1.25 U.S. dollars per British pound.

The Human Resources Committee considered the independence of Mercer’s individual representatives who serve as consultants to the Committee and concluded Mercer is independent and that Mercer’s performance of the unrelated services raises no conflict of interest. The consolidated revenues of MMC were $20.7 billion for the fiscal year ended December 31, 2022 as reported by MMC in its Annual Report on Form 10-K. We provide additional information regarding the Human Resources Committee and our policies and procedures regarding executive compensation below under “Compensation Discussion and Analysis”.

Board, Committee and Director Evaluations

The Board believes it has robust evaluation processes for the Board, its three committees, individual directors and the Chairman of the Board. In particular:

Corporate Governance Documents

We make the following governance-related documents available on the Corporate Governance page under the “Governance” tab in the Investor Relations section of our website, www.oshkoshcorp.com:

•

Our Corporate Governance Guidelines

​

 

Governance of the Company

•

The written charters of the Audit Committee, the Governance Committee and the Human Resources Committee of our Board of Directors

​

•

The Oshkosh Corporation Code of Ethics Applicable to Directors and Senior Executives, which applies to all officers at the vice president level or higher

​

•

The Corporate Code of Ethics and Standards of Conduct, known as “The Oshkosh Way”, which applies to all our employees

​

Each document also is available in print to any shareholder who requests it in writing from our Secretary.

Policies and Procedures Regarding Related Person Transactions

Our Board of Directors adopted the Oshkosh Way for all employees. Our directors and named executive officers are also required to acknowledge in writing that they have received, reviewed and understand the requirements of the Code of Ethics and further acknowledge that failure to fully comply with the Code of Ethics can subject them to discipline, up to and including removal from our Board of Directors or termination of employment.

The Oshkosh Corporation Code of Ethics requires the prompt disclosure to our Chief Ethics and Compliance Officer, Chief Legal Officer or the Chair of the Audit Committee of any proposed transaction or relationship that could create or appear to create a conflict of interest. Upon their review, recommended action can range from concluding that there is no conflict to review with the Board of Directors. Under the Code of Ethics, the phrase “conflict of interest” is broadly construed to include direct conflicts, indirect conflicts, potential conflicts, apparent conflicts, and any other personal, business or professional relationship or dealing that has a reasonable possibility of creating even the mere appearance of impropriety. The Code of Ethics also prohibits directors and senior executives from taking personal advantage of business opportunities that we typically would pursue or in which we may be interested. There is a firm bias against waivers of these restrictions.

Oversight of Risk Management by the Board of Directors

Our Organization Risk Management (ORM) Program plays a critical part in how we manage risks. The Program identifies potential exposure to risks, including economic conditions, disruptive technology, competitive threats, cybersecurity, human capital management and change management. The Program is designed to: (i) provide an assessment of our potential exposure to material risks; (ii) inform as to how senior management addresses and mitigates potential material risks; and (iii) allow an evaluation

 

Governance of the Company

as to how these risks may affect performance, operations and strategic plans and help ensure that senior management is implementing effective mitigation strategies as necessary. The Board and each of its Committees have some role in risk oversight as follows:

Independent Chairman of the Board

Under our By-laws and Corporate Governance Guidelines, our Chairman of the Board must be a director who the Board has determined is independent in accordance with the listing standards of the NYSE and cannot have previously served as an executive officer of our company. As a result, separate individuals serve as Chairman of the Board and Chief Executive Officer. We believe this leadership structure fosters effective governance and oversight of our company by: (i) providing the independent directors with control over the Board meeting agenda and discussion; (ii) assuring that independent directors control discussions about strategic alternatives; (iii) enabling an effective assessment of the Chief Executive Officer’s performance; (iv) providing an effective means for the Board to express its views on management, strategy and execution; and (v) positioning the Chairman to obtain direct and meaningful feedback from shareholders.

 

Proposal 2

RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITOR FOR FISCAL 2023

The Audit Committee has appointed Deloitte & Touche LLP, an independent registered public accounting firm, to serve as our independent auditors for fiscal 2023.

Representatives of Deloitte & Touche LLP will attend the virtual Annual Meeting and will be available to respond to questions. They will have the opportunity to make a statement if they desire to do so.

We are asking our shareholders to ratify the appointment of Deloitte & Touche LLP as our independent auditors. Although ratification is not required by our By-laws or otherwise, our Board is submitting the appointment of Deloitte & Touche LLP to our shareholders for ratification because we value our shareholders’ views on our independent auditors as a matter of good corporate practice. If our shareholders fail to ratify the appointment, the Audit Committee will view the vote as a direction to consider the appointment of a different firm. Even if the appointment is ratified, the Audit Committee in its discretion may select a different independent auditor at any time during the fiscal year if it determines that such a change would be in the best interests of our company and our shareholders.

Audit and Non-Audit Fees

The following table presents fees for professional services rendered by Deloitte & Touche LLP for the audit of our annual consolidated financial statements for fiscal 2022, the Transition Period and fiscal 2021, and fees billed for other services rendered by Deloitte & Touche LLP during those periods.

(1)

Audit fees consisted principally of fees for the audit of our annual consolidated financial statements, for reviews of the interim condensed consolidated financial statements included in our Quarterly Reports on Form 10-Q, and for work in connection with the attestations required by Section 404 of the Sarbanes-Oxley Act of 2002 related to our internal control over financial reporting and statutory audits required internationally.

​

(2)

Audit-related fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements or internal control over financial reporting and are not reported under “Audit fees.” Audit-related fees in fiscal 2022 related to the filing of a Form S-3 Registration Statement under the Securities Act of 1933.

​

(3)

Tax fees in fiscal 2022, the Transition Period and fiscal 2021 consisted of fees billed for the preparation of an income tax return in New Zealand.

​

 

PROPOSAL 2   |    RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITOR

Pre-approval of Services by the Independent Registered Public Accounting Firm

The Audit Committee has adopted a policy for pre-approval of audit and permitted non-audit services to be provided by our independent registered public accounting firm. The Audit Committee will consider annually and, if appropriate, approve the provision of audit services by our independent registered public accounting firm and consider and, if appropriate, pre-approve the provision of certain defined audit and non-audit services. The Audit Committee will also consider on a case by case basis and, if appropriate, approve specific engagements that are not otherwise pre-approved.

Any proposed engagement that does not fit within the definition of a pre-approved service may be presented to the Audit Committee for consideration at its next regular meeting or, if earlier consideration is required, to the Audit Committee Chair or one or more of its members. The member or members to whom such authority is delegated shall report any specific approval of services at the Audit Committee’s next regular meeting. The Audit Committee will regularly review summary reports detailing all services that our independent registered public accounting firm is providing to us.

Report of the Audit Committee

The Audit Committee of our Board of Directors is responsible for providing independent, objective oversight of our financial reporting and disclosure responsibilities, accounting functions and internal controls. The functions of the Audit Committee are described in greater detail in the Audit Committee’s written charter adopted by our Board of Directors. Each member of the Audit Committee is independent as defined by the NYSE’s listing standards and SEC rules.

The Audit Committee reviews our financial reporting process on behalf of our Board of Directors. In fulfilling its responsibilities, the Audit Committee has reviewed and discussed our audited consolidated financial statements contained in the Annual Report on Form 10-K for fiscal 2022 and the Transition Period with our management and independent registered public accounting firm, Deloitte & Touche LLP. Management is responsible for the consolidated financial statements and the reporting process, including the system of internal control. Deloitte & Touche LLP is responsible for expressing an opinion on the conformity of those audited consolidated financial statements with accounting principles generally accepted in the United States and the effectiveness of the internal controls over financial reporting based upon the criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

The Audit Committee discussed with Deloitte & Touche LLP matters required to be discussed by Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 1301, Communications With Audit Committees. In addition, Deloitte & Touche LLP provided to the Audit Committee the written disclosures required by PCAOB Ethics and Independence Rule 3526, Communication with Audit Committees Concerning Independence, and the Audit Committee discussed with Deloitte & Touche LLP their independence.

The Audit Committee further considered the provision of non-audit services by Deloitte & Touche LLP and determined that the provision of such services is compatible with maintaining the independence of Deloitte & Touche LLP.

In reliance on the reviews and discussions referred to above, the Audit Committee recommended to our Board of Directors that our audited consolidated financial statements for fiscal 2022 and the Transition Period be included in our Annual Report on Form 10-K for filing with the SEC.

Audit Committee

•

Duncan J. Palmer, Chair

​

•

Douglas L. Davis

​

•

Tyrone M. Jordan

​

•

Sandra E. Rowland

​

•

Stephen D. Newlin, Alternate Member

​

 

STOCK OWNERSHIP

STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND OTHER LARGE SHAREHOLDERS

The following table shows the beneficial ownership of common stock of each director, each named executive officer appearing in the Summary Compensation Table on page 46, each other shareholder owning more than 5% of our outstanding common stock, and the directors and executive officers (including the named executive officers who are current employees) as a group.

“Beneficial Ownership” means more than “ownership” as that term commonly is used. For example, a person “beneficially” owns stock if he or she owns it in his or her name, or if he or she has (or shares) the power to vote or sell the stock as trustee of a trust. Beneficial ownership also includes shares the directors and executive officers have a right to acquire within 60 days after February 28, 2023, through, for example, the exercise of a stock option.

Except as otherwise stated in the footnotes to the following table, information about common stock ownership is as of February 28, 2023. The percent of common stock beneficially owned is based on the number of shares outstanding on the record date for the Annual Meeting. At the close of business on February 23, 2023, the record date for the Annual Meeting, there were 65,462,573 shares of common stock outstanding. Our policies prohibit directors or named executive officers from pledging shares. Unless stated otherwise in the footnotes to the table, each person named in the table owns his or her shares directly and has sole voting and investment power over such shares.

*

The amount shown is less than 1% of the outstanding shares of common stock.

​

(1)

Amounts shown in this column are not included in the columns titled “Shares of Common Stock Beneficially Owned” or “Percent of Common Stock Beneficially Owned”. Amounts shown include restricted stock units (RSUs) awarded under our 2017 Incentive Stock and Awards Plan in fiscal years 2020 through 2022 in the following amounts to the following individuals:

​

72,138 units for John C. Pfeifer
17,168 units for Michael E. Pack
27,604 units for Jayanthi Iyengar
17,182 units for Ignacio A Cortina
15,226 units for Frank R. Nerenhausen
208,212 units for all executive officers as a group

 

STOCK OWNERSHIP

RSUs are subject to forfeiture until they vest (subject to retirement terms of the awards).

Amounts shown also include stock units under our Deferred Compensation Plan for Directors and Executive Officers, all of which are vested or were free of restrictions, in the following amounts to the following individuals:

15,380 units for Keith J. Allman
2,065 units for Douglas L. Davis
5,098 units for Tyrone M. Jordan
9,703 units for Kimberley Metcalf-Kupres
21,474 units for Stephen D. Newlin
31,776 units for Duncan J. Palmer
1,194 units for David G. Perkins
6,727 units for John S. Shiely
93,417 units for all directors as a group

The units described in this footnote do not carry the right to vote. In each case, amounts are distributable in the form of shares of our common stock on a one-for-one basis. However, no such distribution will occur before April 29, 2023.

(2)

Amounts shown include the following amounts that the listed individuals have the right to acquire pursuant to stock options exercisable between February 28, 2023 and April 29, 2023:

​

9,950 shares for John C. Pfeifer
8,075 shares for Michael E. Pack
18,475 shares for Ignacio A. Cortina
33,300 shares for Frank R. Nerenhausen
134,211 shares for all executive officers as a group

(3)

Amount shown is as described in the Schedule 13G filed jointly with the SEC on February 8, 2023, by American Century Investment Management, Inc. (“ACIM”), American Century Companies, Inc. (“ACC”) and Stowers Institute for Medical Research (“Stowers”). ACC is controlled by Stowers. ACIM is a wholly owned subsidiary of ACC. The address of each of ACIM, ACC and Stowers is 4500 Main Street, 9th Floor, Kansas City, Missouri 64111. The Schedule 13G reports that each of ACIM, ACC and Stowers has sole voting power over 3,870,793 shares, shared voting power over no shares and sole dispositive power over all of the shares shown.

​

(4)

Amount shown is as described in the Schedule 13G/A that Aristotle Capital Management, LLC filed with the SEC on February 14, 2023. Aristotle Capital Management, LLC is located at 11100 Santa Monica Blvd., Suite 1700, Los Angeles, California 90025. Aristotle Capital Management, LLC reported beneficial ownership of 7,494,676 shares and had sole voting power over 6,630,551 shares, shared voting power over no shares, sole investment power over 7,494,676 shares and shared investment power over no shares.

​

(5)

Amount shown is as described in the Schedule 13G/A that BlackRock, Inc. filed with the SEC on January 25, 2023. BlackRock, Inc. is located at 55 East 52nd Street, New York, New York 10055. BlackRock, Inc. reported beneficial ownership of 5,766,911 shares and had sole voting power over 5,636,523 shares, shared voting power over no shares, sole investment power over 5,766,911 shares and shared investment power over no shares.

​

(6)

Amount shown is as described in the Schedule 13G that FMR, LLC filed with the SEC on February 9, 2023. FMR LLC is located at 245 Summer Street, Boston, Massachusetts 02210. FMR LLC reported beneficial ownership of 5,869,364 shares and had sole voting power over 4,731,666 shares, shared voting power over no shares, sole investment power over 5,869,364 shares and shared investment power over no shares.

​

(7)

Amount shown is as described in the Schedule 13G/A that The Vanguard Group filed with the SEC on February 9, 2023. The Vanguard Group is located at 100 Vanguard Blvd., Malvern, Pennsylvania 19355. The Vanguard Group reported beneficial ownership of 6,279,471 shares and had sole voting power over no shares, shared voting power over 21,969 shares, sole investment power over 6,200,319 shares and shared investment power over 79,152 shares.

​

(8)

Amount shown is as described in the Schedule 13G that Victory Capital Management Inc. filed with the SEC on February 2, 2023. Victory Capital Management is located at 4900 Tiedeman Rd. 4th Floor, Brooklyn, Ohio 44144. Victory Capital Management reported beneficial ownership of 3,280,464 shares and had sole voting power over 3,213,058 shares, shared voting power over no shares, sole investment power over 3,280,464 shares and shared investment power over no shares.

​

 

STOCK OWNERSHIP

Delinquent Section 16(a) Reports

The Securities Exchange Act of 1934 requires our directors, executive officers and controller to file reports with the SEC regarding their ownership and changes in ownership of our common stock. Based upon our review of copies of these reports and certifications given to us by such persons, we believe our directors, executive officers and controller have complied with their filing requirements for fiscal 2022.

 

Compensation Discussion and Analysis

EXECUTIVE SUMMARY

Introduction and Overview

This Compensation Discussion and Analysis explains our compensation program and policies for fiscal 2022 and details the compensation decisions we made with respect to our named executive officers, or NEOs, and how their fiscal 2022 compensation aligns with our pay-for-performance philosophy. For fiscal 2022 (January 1, 2022 through December 31, 2022), our NEOs identified in the Summary Compensation Table are as follows:

Oshkosh Strategy, Strengths and Fiscal 2022 Highlights

We describe our strategy with three simple words: Innovate. Serve. Advance. We believe this strategy provides the necessary framework to drive long-term, sustainable growth and is grounded in our purpose of making a difference in people’s lives. Our People First culture enables our strategy by creating an environment that is diverse, equitable and inclusive. When our team members thrive, innovation thrives.

We are committed to creating value for shareholders and are driven by our powerful purpose: making a difference in people’s lives. Our many strengths contribute to our positive outlook and support our plans to grow revenue, operating income and return on invested capital (ROIC) over the next several years. We believe these strengths include:

•

Leading market positions for our products and services.

​

•

Favorable market dynamics signaling increased demand for our products.

​

•

Opportunities for organic and inorganic growth supported by our M & A strategy.

​

•

Disciplined capital allocation designed to balance our investments and deliver shareholder value.

​

Oshkosh worked through ongoing supply chain disruptions and persistent inflation in fiscal 2022 to grow revenues during the year. We made significant progress combatting inflationary pressures with multiple price increases and persevering through supply chain disruptions by dual sourcing, re-sourcing and redesigning products to take advantage of more readily available parts. These actions enabled our company to significantly improve operating results as the year progressed, providing important momentum as we exited fiscal 2022. Oshkosh more than doubled consolidated operating income from the first half of the year to the second half of the year and remains focused on actions to optimize our global operations and advance innovation to support customers as we drive long-term growth and create shareholder value.

 

Compensation Discussion and Analysis

•

Our revenues in fiscal 2022 increased by 4.1% from $7.95 billion in the year ended December 31, 2021 to $8.28 billion in fiscal 2022. We received record orders in the fiscal year and ended the year with record backlogs in several segments, leading to a consolidated backlog of  $14 billion, which we believe supports a solid outlook moving forward.

​

•

Consolidated operating income in fiscal 2022 was $372.3 million, or 4.5% of sales.

​

•

We generated over $600 million of cash flow from operations during the year.

​

•

Diluted earnings per share (EPS) was $2.63 in fiscal 2022, a decrease of 60.6% compared with EPS of  $6.68 in the year ended December 31, 2021.

​

•

In fiscal 2022, we returned $252.3 million of cash to shareholders through a combination of dividends and share repurchases, including cash dividends totaling $97.3 million.

​

Pay for Performance

A fundamental principle underlying our compensation program is that we pay for performance. Our compensation program for fiscal 2022 supported performance by providing appropriate incentives to our executives. To prudently manage our compensation investments while still attracting and retaining the highest caliber executives, we generally set base salary and target amounts of other elements of compensation close to the 50th percentile for the companies represented in the database that we discuss below.

Overall, we allocate a greater portion of NEO compensation to incentive-based pay that varies based on company and segment performance (annual incentive and long-term equity incentives) than to fixed compensation (base salary) as the graphics below illustrate. We limit benefits that NEOs receive that are not broadly available to Oshkosh employees to those related to business need.

TARGET COMPENSATION MIX

The target value represents the total direct compensation which we set close to the 50th percentile of companies in the Mercer US Executive Remuneration Database.

Fiscal 2022 Target Compensation CEO

We display fiscal 2022 target compensation for Mr. Pfeifer in the graphic below.

 

Compensation Discussion and Analysis

Fiscal 2022 Target Compensation for Other NEOs

We display fiscal 2022 average target compensation for all other NEOs in the graphic below. These averages exclude the one-time restricted stock unit award that we provided to Ms. Iyengar in connection with her hiring to better represent target annual compensation.

Transition to Calendar Year for Fiscal 2022

The company transitioned to a calendar year fiscal year beginning January 1, 2022 to better align our planning and reporting activities to those of our customers and suppliers. In consideration of this transition, the Committee made certain compensation adjustments to address the Transition Period (October 1, 2021 to December 31, 2021). The concept the Committee followed was to provide compensation opportunities for the Transition Period that were similar to fiscal 2021 on a pro-rata basis for both short- and long-term incentive purposes as follows:

•

The Committee established short-term incentives for the Transition Period with target amounts at 25% of normal annualized targets. The range of payout was 0% for performance below threshold up to 100% (of the 25%) for performance at or exceeding targets. The performance measures were consolidated operating income for corporate NEOs and segment operating income for segment NEOs. We did not meet threshold performance for consolidated operating income. The Access Equipment segment performance was between threshold and target performance which yielded a payout of 76.8%. for Mr. Nerenhausen.

​

•

The Committee approved long-term incentive grants for the Transition Period with a target value of approximately 25% of normal annualized values. These grants consisted of restricted stock units with pro-rata vesting over three years.

​

•

There were no changes to base salary during the Transition Period.

​

•

Ms. Iyengar joined the company on January 3, 2022 and therefore did not participate in any Transition Period compensation opportunities.

​

Say-on-Pay

At our 2022 Annual Meeting, shareholders strongly supported our executive compensation program with 95.2% of the votes cast in favor of the annual advisory proposal on the fiscal 2021 compensation of our NEOs. We engage frequently with our shareholders to listen, learn and understand what our investors view as important. Specifically, we engage on subjects such as our company performance, corporate governance, sustainability, human capital management, capital allocation and executive compensation. During fiscal 2022, we hosted an Investor Day to highlight technology advancements, strategy for growth, 2025 financial targets, and our ongoing commitment to sustainability. We continue to review our shareholder engagement program and refine it, if appropriate, to ensure it aligns with company objectives and our shareholders’ interests.

 

Compensation Discussion and Analysis

Fiscal 2022 Performance Measures — Annual Cash Incentive Awards

For fiscal 2022, we maintained the same performance measures as in fiscal 2021 for our annual cash incentive awards: consolidated and segment operating income (OI) and consolidated and segment days net working capital (DNWC). These performance measures provide focus on our Innovate. Serve. Advance. strategy and reinforce strong working capital management , robust cash flow and growth in earnings per share. We discuss and explain these performance measures in greater detail below under “COMPENSATION DECISIONS FOR FISCAL 2022 — Annual Cash Incentive Awards.” We continue to believe it is important to provide business segment presidents the opportunity to be rewarded for results primarily tied to their business segment.

Fiscal 2022 Performance Measures — Long-Term Incentive Awards

For fiscal 2022, we maintained relative total shareholder return (TSR) and relative ROIC as performance measures for our long-term incentive performance share awards. These awards reinforce the importance of outperforming peer companies in similar industries through market cycles and macroeconomic events.

In addition, for fiscal 2022, the Committee introduced objectives relating to diversity and climate change to align the structure with the company’s focus on environmental, social and governance (ESG) initiatives, with 10% of annual long-term incentive awards allocated to these measures. For this portion of the annual long-term incentive award, we used three equally weighted measures: Female leadership representation (Female); black, indigenous and people of color (BIPOC) representation; and improvement in greenhouse gas (GHG) emissions normalized for sales. We are committed to limiting our impact on climate change and we believe that an inclusive and diverse workforce is critical to long-term business success. Including these measures in the performance share awards will help drive continued focus in these areas.

We discuss and explain our performance measures in greater detail below under “COMPENSATION DECISIONS FOR FISCAL 2022 — Performance Share Awards.”

 

Compensation Discussion and Analysis

HUMAN RESOURCES COMMITTEE OVERSIGHT RESPONSIBILITIES

The Human Resources Committee establishes, oversees and approves the compensation program, awards, practices and procedures for our executive officers. The Committee makes annual compensation decisions using a thoughtful and deliberate process based on performance, open discussion and competitive market data Mercer provides as the Committee’s independent compensation consultant. The Committee also recommends to the Board of Directors the competitive pay package for its directors.

COMPENSATION PHILOSOPHY AND OBJECTIVES

A fundamental principle underlying our compensation program is that we pay for performance. The objective of our compensation program is to incentivize the achievement of both short- and long-term results through the alignment of pay with performance goals that we set rigorously. We intend this approach to attract, retain, motivate and sustain high performing executive talent. The Committee strives to clearly link pay to performance and align incentive compensation opportunities with the long-term interests of our shareholders. As a result, we designed our compensation program to reward executives for annual financial results as well as strategic decision-making for sustained long-term company performance.

Checklist of Compensation Practices

Consistent with the objectives of our compensation program, the Committee has designed cash and equity awards that have varying timeframes for earning and payment and include a substantial proportion of pay that is “at risk” and dependent on future performance. The primary components of our executive compensation program in fiscal 2022 were as follows:

 

Compensation Discussion and Analysis

In certain circumstances, such as for newly hired or promoted executives or for retention purposes, we may also provide compensation outside of these compensation components.

The Committee awarded Ms. Iyengar a one-time restricted stock unit grant in connection with her hiring with a value of $3,451,350 on January 3, 2022. We intended this additional equity award to offset the long-term incentive value forfeited with her prior employer and also provide a long-term incentive value aligned to the value of this new position as well as Ms. Iyengar’s experience and capabilities.

ANNUAL COMPENSATION PROGRAM DESIGN REVIEW

We generally target compensation close to the 50th percentile of the compensation database that we use. We believe our executive compensation program positions us to compete effectively when recruiting, selecting and seeking to retain key executives. The Human Resources Committee believes that retaining a high-performing executive team is important for the long-term success of the business.

The Committee annually evaluates our compensation program to determine if it is appropriate to adjust the program design, types of awards, or levels of pay. For fiscal 2022, this evaluation included a review with Mercer of its analysis of general industry compensation data. As we describe in more detail below, this analysis gives the Committee comparative references and enhances the Committee’s understanding of each executive’s compensation package.

The Committee decided to continue to use consolidated OI and consolidated DNWC as performance measures for the fiscal 2022 annual cash incentive awards for NEOs other than segment presidents. Retaining consolidated OI as a measure allowed for a continued emphasis on maximizing income. Retaining consolidated DNWC as a measure for NEOs other than segment presidents continued to reinforce strong consolidated working capital management. The DNWC measure for corporate NEOs also aligns with the measures that we assign to our segment presidents. For our segment presidents, the Committee decided to use consolidated OI, segment OI and segment DNWC measures for the fiscal 2022 annual cash incentive award, which were the same measures we used for fiscal 2021. Like ROIC, which is a measure we use in our long-term incentive awards, DNWC provides important focus on maximizing cash flow.

The OI and DNWC measures align with our value drivers of sales growth, operating margin, and ROIC.

DETERMINING PAY LEVELS

For fiscal 2022, Mercer provided the Committee various analyses of general industry compensation data from its US Executive Remuneration Database, a survey that includes compensation for more than 1,600 organizations. We use this database because we believe the survey size ensures consistent and statistically valid data that is representative of the market in which we compete for executive talent. We generally consider only aggregate data and do not select individual companies for comparison. We believe this approach avoids giving undue importance to statistically outlying companies while offering a general understanding of compensation practices in the market. However, we do review data that is sourced from public companies and regressed to our revenue scope to ensure the data is relevant to our market for executive talent.

The Mercer US Executive Remuneration Database includes data regarding base salary, target and actual annual cash incentive awards, and target and actual long-term incentive awards. The data reflects the individual responsibilities of each position and company revenue size. In addition to the market data, the Committee also considers, in a subjective manner, the annual evaluation of each executive officer’s performance when determining base salary, annual incentive awards and long-term incentive awards.

We hired Ms. Iyengar into the role of Executive Vice President, Chief Technology and Strategic Sourcing Officer on January 3, 2022. The Committee used the same Mercer US Executive Remuneration Database when preparing and approving Ms. Iyengar’s base pay, target annual incentive, and annual long-term incentive award.

COMPENSATION DECISIONS FOR FISCAL 2022

Base Salary

In September 2021, the Committee reviewed the Mercer US Executive Remuneration Database by position to evaluate the competitiveness of the NEOs’ base salaries. The Committee generally believes base salaries that are within 10% of the

 

Compensation Discussion and Analysis

50th percentile for this database are competitive. The Committee reviewed Mr. Pfeifer’s performance and reviewed the performance evaluations of the other NEOs, which Mr. Pfeifer prepared, to ensure that base salary decisions for each executive reflected the executive’s performance and were otherwise consistent with our compensation goals. After analyzing the data and performance information for each executive, the Committee decided to provide larger base salary increases to Messrs. Pfeifer and Pack to recognize strong performance, time in position and to progress their total compensation opportunities towards the median of market benchmarks. The Committee decided to provide competitive increases to Messrs. Cortina and Nerenhausen reflecting strong performance through fiscal 2021 and also to maintain competitive positioning compared to market benchmarks given their respective roles, skills and experience. Based on our philosophy for establishing base salaries, the Committee used the same database and determined the appropriate base salary to provide Ms. Iyengar as a newly-employed executive effective January 3, 2022.

Summary of Fiscal 2022 Base Salary Adjustments

Base salary adjustments for fiscal 2021 and fiscal 2022 were as follows:

(1)

Ms. Iyengar was hired effective January 3, 2022 and did not receive additional base salary increases within 2022.

​

Annual Cash Incentive Awards

Our annual cash incentive plan links cash awards to the achievement of specific short-term corporate performance goals that the Committee approves each year. These awards tie a significant portion of an executive’s annual compensation to our company’s performance. For fiscal 2022, awards were dependent on our performance under a combination of two measures for NEOs other than segment presidents: consolidated OI and consolidated DNWC; and three measures for segment presidents: consolidated OI, segment OI, and segment DNWC.

After the Committee reviewed the Mercer US Executive Remuneration Database and each executive’s performance, the Committee assigned each executive a threshold, target and maximum annual cash incentive award payment level, as a percentage of base salary, for fiscal 2022. As in the past, we targeted the annual cash incentive award opportunity at approximately the 50th percentile of the competitive data as reflected in the database. For fiscal 2022, the Committee maintained target percentages consistent with fiscal 2021 levels for Mr. Nerenhausen and increased target percentages for Messrs. Pfeifer, Pack and Cortina as we note in the table below. Based on our philosophy for establishing target percentages, the Committee used the same database and determined the appropriate target percentage to provide to Ms. Iyengar upon her hiring effective January 3, 2022.

The payout opportunities for the NEOs for fiscal 2022 are set forth in the table below:

(1)

Ms. Iyengar was not an NEO during fiscal 2021.

​

 

Compensation Discussion and Analysis

Annual Cash Incentive Awards-Operating Income and Fiscal 2022 Results

The Committee structured our annual cash incentive awards for fiscal 2022 with operating income targets that reflected the uncertainties associated with volatile supply chain and labor markets. Actual fiscal 2022 results for annual cash incentive plan purposes based on the definitions below (which may differ from reported results based on U.S. Generally Accepted Accounting Principles) also appear in the last column of the chart below.

•

Consolidated OI equals income from continuing operations before other income/expense, income taxes and equity in earnings of our unconsolidated affiliates, adjusted for losses on the liquidation of foreign entities ($4.6 million), for impairment charges ($7.7 million), to remove our change in accounting methodology for inventories ($57.9 million) and Maxi-Métal income ($0.5 million).

​

•

Access Equipment segment OI equals income from continuing operations before other income/expense, income taxes and equity in earnings of unconsolidated affiliates, adjusted for losses on the liquidation of foreign entities ($4.6 million) and to remove the change in accounting methodology for inventories ($16.9 million).

​

The results satisfied the annual incentive plan requirement that we achieve a minimum 3% operating income margin on a consolidated or segment basis, as applicable, in fiscal 2022 to receive an OI payment above target. Actual OI margin in fiscal 2022 was 3.9% on a consolidated basis and 7.6% for the Access Equipment segment, in each case using amounts based on the definitions above (which may differ from reported results).

Annual Cash Incentive Awards-Days Net Working Capital and Fiscal 2022 Results

The Committee established the targets for DNWC based on our forecasted financial performance, as indicated below. Actual fiscal 2022 results based on the definitions below also appear in the last column in the chart below.

•

Consolidated DNWC is the average Net Working Capital (NWC) for the five consecutive quarters ending December 31 divided by the average daily sales excluding acquisition during fiscal 2022. NWC is defined as current assets (less cash) minus current liabilities (less short-term debt and customer advances at our Pierce Manufacturing, Inc. subsidiary), adjusted for working capital of Maxi-Métal of  $5.5 million, $3.7 million and $6.0 million at June 30, 2022, September 30, 2022 and December 31, 2022, respectively, and to provide for a LIFO reserve as if the company did not change its accounting methodology for inventories of  $167.7 million, $170.2 million, $177.1 million, $187.0 million and $225.6 million at December 31, 2021, March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022, respectively.

​

•

Access Equipment segment DNWC is the average NWC for the five consecutive quarters ending December 31 divided by the average daily sales for fiscal 2022. NWC is defined as current assets (less cash) minus current liabilities (less short-term debt), adjusted to provide for a LIFO reserve as if the company did not change its in accounting methodology for inventories of  $48.6 million, $46.8 million, $50.2 million, $55.7 million and $65.5 million at December 31, 2021, March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022, respectively.

​

 

Compensation Discussion and Analysis

Fiscal 2022 Annual Incentive Award Payouts

Based on consolidated and segment results, performance payouts under the annual cash incentive plan to our NEOs were as follows:

(1)

The target annual incentive award represents fiscal 2022 base salary multiplied by each NEO’s target award percentage.

​

(2)

Payout level is the sum of the results of each performance measure as a percentage of target performance multiplied by each measure’s respective weighting.

​

Equity-Based Long-Term Incentive Awards

The Committee historically granted individual equity awards for executives on an annual basis at its November meeting. Following the change to a calendar year fiscal year, in fiscal 2022 and going forward, the Committee will grant individual equity awards for executives on an annual basis at its February meeting. Grants of equity awards in fiscal 2022 are subject to the terms of the 2017 Incentive Stock and Awards Plan, which shareholders approved at the 2017 Annual Meeting.

In fiscal 2022, as we had done in the recent past, we provided two types of equity-based long-term incentive awards: performance shares and restricted stock units. The Committee believes equity-based long-term incentive awards are key components of our compensation program and appropriately align pay with performance. Long-term incentive awards serve the following three critical functions:

•

Motivate executives to focus on our long-term growth and performance;

​

•

Encourage and facilitate executive ownership of our common stock, which aligns executive objectives with those of shareholders; and

​

•

Help to attract and retain key executives, which we believe contributes to increased shareholder value.

​

For annual equity awards that the Committee granted in fiscal 2022, the Committee provided to each NEO long-term incentive awards with a target value generally equal to the 50th percentile of long-term incentive award values in the Mercer US Executive Remuneration Database. The awards provided a significant incentive for executives to execute our strategy, achieve fiscal 2022 performance goals and deliver total shareholder return and also provided considerable retention value for key executives. The following table summarizes target long-term incentive grant date award values that we used for awards to NEOs for fiscal 2021 and fiscal 2022.