Christopher A. Jessup
AARAbout Christopher A. Jessup
Senior Vice President and Chief Commercial Officer at AAR CORP. (AIR); age 47 as of FY 2025. Jessup has served as AAR’s Chief Commercial Officer since June 2017 (previously CCO for the Aviation Services segment from 2015) and joined AAR in 2008 via the acquisition of Avborne Heavy Maintenance, Inc. He holds a BBA and an MBA in Aviation from Embry‑Riddle Aeronautical University . Recent pay-for-performance outcomes show: FY 2025 short‑term incentive paid at 102% on metrics of adjusted diluted EPS ($3.91) and adjusted net working capital turns (3.29) ; the FY 2023 PSU cycle (3‑year period ending FY 2025) paid at 221% with relative TSR at the 59th percentile, signaling strong multi‑year performance alignment .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| AAR CORP. | Senior Vice President, Chief Commercial Officer | 2017–present | Leads enterprise commercial strategy; named CCO in 2017 after serving as CCO of AAR’s Aviation Services segment starting 2015 . |
| AAR CORP. (MRO Services) | Senior leadership roles incl. Senior Vice President, Airframe MRO Services | 2008–2015 | Ran senior sales and operational roles across repair and engineering; culminated as SVP, Airframe MRO Services . |
| Avborne Heavy Maintenance, Inc. | Vice President, Sales & Marketing | ~2002–2008 | Senior commercial leadership; AAR acquired Avborne in March 2008, bringing Jessup into AAR . |
External Roles
- No other public company directorships or external board roles disclosed in company filings reviewed.
Fixed Compensation
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Base Salary ($) | 480,000 | 494,000 | 509,000 |
| Target Bonus (% of base) | — | 100% | 100% |
| Actual Bonus Paid ($) | 657,600 | 879,320 | 519,180 |
| All Other Compensation ($) | 194,827 | 182,799 | 211,503 |
Performance Compensation
Annual Incentive (Short‑Term Incentive Plan)
- Design: 80% adjusted diluted EPS; 20% adjusted net working capital turns; straight‑line between threshold/target/maximum .
- FY 2025 outcome: EPS $3.91 (103% payout), NWC turns 3.29 (99% payout), total payout 102%; Jessup actual bonus $519,180 .
| FY 2025 STI Metric | Weight | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|---|
| Adjusted diluted EPS (cont. ops) | 80% | $2.93 | $3.90 | $4.29 | $3.91 | 103% |
| Adjusted net working capital turns | 20% | 2.48 | 3.31 | 4.14 | 3.29 | 99% |
| Total | 100% | — | — | — | — | 102% |
| FY 2024 STI Metric | Weight | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|---|
| Adjusted diluted EPS (cont. ops) | 80% | $2.44 | $3.05 | $3.36 | $3.33 | 190% |
| Adjusted net working capital turns | 20% | 2.28 | 3.04 | 3.80 | 3.26 | 129% |
| Total | 100% | — | — | — | — | 178% |
Long‑Term Incentive (Structure and Grants)
- Mix: 60% performance‑based RS (PSUs), 20% stock options, 20% time‑based RS (RSUs) in FY 2024 and FY 2025 .
- PSU metrics and weights: Adjusted income from continuing ops (70%), Average ROIC (20%), Relative TSR (10%) .
- Vesting: PSUs and RSUs vest 100% at year 3 (PSU subject to performance); options vest 33 1/3% each on 7/31 of years 1–3 .
| Component (FY 2025 LTI) | Grant Date | Number | Exercise Price | Vesting | Performance Metrics |
|---|---|---|---|---|---|
| PSUs (target) | 7/22/2024 | 13,180 | — | 100% cliff on 7/31/2027, subject to performance | Adj. income (70%), Avg ROIC (20%), Rel. TSR (10%) |
| RSUs (time‑based) | 7/22/2024 | 4,395 | — | 100% on 7/31/2027 | — |
| Stock Options | 7/22/2024 | 11,540 | $67.02 | 1/3 on 7/31/2025, 7/31/2026, 7/31/2027 | — |
Long‑Term Incentive (Achievement – FY 2023 PSU cycle)
| Metric (FY 2023 PSU cycle: 6/1/2022–5/31/2025) | Target | Actual | Result |
|---|---|---|---|
| Adjusted income from continuing ops (70% weight) | $306.9m | $359.8m | 229% payout for this metric |
| Adjusted ROIC (20% weight) | 8.06% | 9.44% | 229% payout for this metric |
| Relative TSR (10% weight) | 50th percentile | 59th percentile | 146% payout for this metric |
| Overall PSU payout (3‑yr) | — | — | 221% |
| FY 2023 PSU Payout (Shares) | Target Shares | Total Shares Paid |
|---|---|---|
| Christopher A. Jessup | 10,150 | 22,432 |
Equity Ownership & Alignment
| As of | Beneficial Shares | % of Outstanding | Options Exercisable within 60 days | Unvested Time‑based RS (#) | Unvested PSUs at Target (#) |
|---|---|---|---|---|---|
| 7/22/2025 | 94,139 | ~0.26% (94,139 / 35,964,153) | 22,974 | 12,390 (MV $760,870 at $61.41) | 32,085 (MV $1,970,340 at $61.41) |
- Unexercisable options outstanding (as of 5/31/2025): 4,023 @ $41.88; 4,477 @ $58.27; 11,540 @ $67.02 (total 20,040) .
- Upcoming equity vesting dates (time‑based RS for Jessup): 5,075 (7/31/2025); 2,920 (7/31/2026); 4,395 (7/31/2027) .
- Upcoming PSU vesting (target counts): 10,150 (7/31/2025); 8,755 (7/31/2026); 13,180 (7/31/2027) .
- Ownership guidelines: CEO 6x salary; direct reports to CEO 2x; other executive officers 1x. Company disclosed all directors and NEOs complied as of May 31, 2023 and May 31, 2024 .
- Hedging/pledging: Policy prohibits hedging and pledging by officers (except cashless option exercises); ownership tables state no pledged shares for listed persons .
Employment Terms
| Scenario | Cash Severance | Bonus | Health/Other | Equity Treatment |
|---|---|---|---|---|
| Termination by company other than for Cause or Disability (outside CoC window) | 12 months base salary ($509,000) | Prior‑year earned bonus and pro‑rata current‑year bonus; FY 2025 shown $519,180 as “Bonus” line item for Jessup | Health/welfare benefits during severance period | Forfeiture of unvested RS/Options absent Retirement eligibility (none of current NEOs eligible at 5/31/2025) |
| Qualifying termination within 18 months after a Change‑in‑Control (double‑trigger) | 2x salary ($1,018,000) | As listed: $2,277,820 for Jessup (plan‑defined; amount shown in table) | Health & welfare continuation ($53,240) and outplacement ($97,182) | All restricted stock and options vest (with PSUs at higher of target or actual, subject to plan/award agreement nuances) |
| Equity vesting value in CoC context (illustrative at 5/31/2025) | — | — | — | RS: $2,731,210; Options: $92,627 for Jessup (valued at $61.41) |
- Agreements: Jessup is covered by severance/change‑in‑control agreements (double trigger); CEO has separate employment agreement (single‑trigger equity vesting on CoC) .
- Restrictive covenants: Confidentiality and non‑compete enforced during the one‑year severance period; severance ceases upon breach .
- Clawback: NYSE Rule 10D‑1‑compliant incentive compensation recoupment policy adopted; prior clawback policy remains applicable for pre‑Oct 2023 awards .
Compensation Structure Analysis
- Mix and trajectory: LTI program increased performance orientation from 50% PSUs (FY 2023) to 60% (FY 2024 and FY 2025); options and time‑based RS each at 20% .
- Year‑over‑year: Base salary rose 3% in FY 2025 (to $509k), in line with peer‑aligned merit guidelines; target bonus remained 100% of base . Actual annual bonus decreased FY 2025 vs FY 2024 (payout 102% vs 178%), reflecting plan results .
- Stock awards: Grant date fair value of stock awards rose for Jessup from $680,302 (FY 2024) to $1,177,877 (FY 2025), consistent with program design and market positioning disclosures .
Equity Ownership & Pledging
- Beneficial ownership declined from 117,171 shares (as of 7/25/2024) to 94,139 (as of 7/22/2025), with exercisable options within 60 days at 39,739 (2024) vs 22,974 (2025) .
- Company policy prohibits hedging and pledging by officers; disclosures indicate no pledged shares among listed insiders .
Performance & Track Record
- FY 2025 STI metrics achieved near‑target results (EPS $3.91; NWC turns 3.29), paying at 102% .
- FY 2023 PSU cycle paid 221% with adjusted income and ROIC both at 229% achievement; relative TSR at the 59th percentile (146% payout on that metric) .
Compensation Committee and Governance Practices
- Independent compensation consultant (e.g., Semler Brossy) engaged by the Human Capital & Compensation Committee (independence assessed; no conflicts) .
- Pay philosophy targets around market median with opportunity to reach/exceed 75th percentile for exceptional performance; meaningful stock ownership guidelines; prohibition on hedging/pledging; clawbacks; double‑trigger CoC provisions (CEO equity single‑trigger retained) .
Investment Implications
- Alignment: Strong, with 60% of LTI in PSUs linked to adjusted income, ROIC, and relative TSR; robust clawback, anti‑hedge/pledge, and ownership policies reduce misalignment risks .
- Vesting‑related flow risk: Material vesting events for Jessup on 7/31/2025, 7/31/2026, and 7/31/2027 across PSUs, RSUs, and options could create episodic liquidity/supply; monitor Form 4s around these dates .
- Change‑in‑control economics: Double‑trigger cash (2x salary plus plan‑defined bonus) and full equity acceleration on qualifying termination post‑CoC create standard‑market protections; no tax gross‑ups disclosed .
- Execution signals: Above‑target PSU payouts (221%) and program mix shift toward performance equity support management confidence and pay‑for‑performance discipline; annual bonus outcomes normalized in FY 2025 (102%) after an elevated FY 2024 (178%) .