AAR CORP (NYSE: AIR) sets stock-price hurdles for $15M CEO grant
Rhea-AI Filing Summary
AAR CORP. approved a special long-term performance incentive for Chairman, Chief Executive Officer and President John M. Holmes consisting of 161,500 shares of performance-based restricted stock, with a targeted grant-date fair value of approximately $15 million under its 2013 Stock Plan.
The award cliff vests on July 31, 2031 only if the 30-day volume weighted average share price reaches stock price hurdles of $175, $200 and $250, each unlocking one-third of the shares. These hurdles reflect premiums of 35%, 54% and 93% over the $129.47 grant-date closing price and are described as potentially creating more than $4.5 billion in stockholder value if fully achieved. Limited vesting may occur upon certain termination or change-in-control events, but only to the extent the corresponding price hurdles have been met.
Positive
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8-K Event Classification
2 items: 5.02, 9.01
2 items
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Governance
Key personnel changes including departures, elections, or appointments of directors and executive officers.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Performance-based restricted stock grant: 161,500 shares
Target grant-date fair value: approximately $15 million
First stock price hurdle: $175
+5 more
8 metrics
Performance-based restricted stock grant
161,500 shares
Shares awarded to CEO John M. Holmes under the 2013 Stock Plan
Target grant-date fair value
approximately $15 million
Used to determine the number of shares granted in the special award
First stock price hurdle
$175
30-day volume weighted average price triggering vesting of one-third of the shares
Second stock price hurdle
$200
30-day volume weighted average price triggering vesting of an additional one-third of the shares
Third stock price hurdle
$250
30-day volume weighted average price triggering vesting of the final one-third of the shares
Grant-date closing price
$129.47
Closing price per share on July 23, 2026, used to measure hurdle premiums
Premiums to grant-date price
35%, 54% and 93%
Premiums represented by the $175, $200 and $250 stock price hurdles over $129.47
Estimated stockholder value creation
more than $4.5 billion
Value the company associates with full achievement of the award’s stock price hurdles
Key Terms
performance-based restricted stock, volume weighted average trading price, cliff vests, change in control
4 terms
performance-based restricted stock financial
"approved a long-term performance incentive grant of performance-based restricted stock"
Shares granted to employees or executives that are held back and only become actual, tradable stock if the company meets predefined performance targets; until those goals are met the shares cannot be sold. Think of it like a bonus held in escrow that’s released only when specific results are achieved — investors watch these awards because they tie management pay to company outcomes, can dilute existing shareholders when released, and signal how confident or incentivized insiders are to meet growth or profitability goals.
volume weighted average trading price financial
"when the 30-day volume weighted average trading price of a share"
Volume weighted average trading price (VWAP) is the average price of a security over a set period, calculated by giving more weight to prices where more shares were traded — in other words, prices with higher volume count more. Investors use VWAP as a benchmark to judge trade execution and market activity: it helps tell whether a buy or sell occurred at a better or worse price than the market’s typical traded level, like comparing your purchase to the crowd’s average.
cliff vests financial
"The performance-based restricted stock cliff vests on July 31, 2031"
change in control regulatory
"In the event of a change in control of the Company"
A "change in control" occurs when the ownership or management of a company shifts significantly, such as through a merger, acquisition, or sale of a large part of its assets. This change can impact how the company is run and may influence its future direction. For investors, it matters because it can affect the company's stability, strategy, and value, often signaling potential changes in investment risk or opportunity.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What special equity award did AAR CORP (AIR) grant to CEO John M. Holmes?
AAR CORP granted John M. Holmes a special long-term incentive of 161,500 shares of performance-based restricted stock with a targeted fair value of about $15 million. The company states this award is separate from his regular annual long-term incentive compensation.
How do the stock price hurdles work for the AAR CORP (AIR) CEO grant?
The award vests only if a 30-day volume weighted average price hits $175, $200 and $250, each level vesting one-third of the 161,500 shares. All hurdles must be reached on or before July 31, 2031 for the full grant to be earned.
When does the AAR CORP (AIR) CEO performance-based restricted stock vest?
The performance-based restricted stock cliff vests on July 31, 2031. Vesting requires Mr. Holmes’ continued service through that date, except for limited termination scenarios, and depends on achieving the specified stock price hurdles measured by a 30-day volume weighted average trading price.
What potential stockholder value does AAR CORP (AIR) associate with the CEO award?
AAR CORP states that fully achieving the stock price hurdles would create more than $4.5 billion in stockholder value. It also notes that, for the award to be fully earned, the stock price and company value would need to more than double from May 31, 2026 levels.
What happens to the AAR CORP (AIR) CEO award upon change in control or certain terminations?
If there is a change in control, death, disability, or a termination by the company not for cause, a portion of the award may vest as of that event. Vesting in those cases is limited to the portion tied to any stock price hurdles already met or exceeded.