Steven Menneto

About Steven Menneto

Steven D. Menneto, age 60, is President, Chief Executive Officer, and a director of Malibu Boats, Inc. (since August 5, 2024) . He holds a B.S. in Business Administration from Northeastern University and an MBA from Rensselaer Polytechnic Institute . Fiscal 2025 performance under his tenure reflected a cyclical downturn: net sales $807.6M, net income $15.2M, and Adjusted EBITDA $74.8M ; the company repurchased ~$36M of stock in FY25 . On a pay-versus-performance basis, TSR stood at $60.3 (value of $100 since June 30, 2020) at FY25-end, with CAP reflecting lower payouts in a down year .

Past Roles

External Roles

Fixed Compensation

Performance Compensation

• Annual Incentive Plan (FY2025): 50% Net Income (GAAP) + 50% Adjusted EBITDA; both must meet ≥90% of target for any payout .

• Long-Term Incentives (granted Nov 4, 2024): 60% performance-based (50% relative TSR vs Russell 2000; 50% 3-year Adjusted EBITDA CAGR), 40% time-based .
  • Relative TSR vesting: 0–200% based on TSR vs Russell 2000 (threshold 80%=50%, target 100%=100%, 140%+=200%) .
  • Adjusted EBITDA CAGR vesting: 0–150% (threshold 10%=100%, 15%+=150%; no vesting below 10%) .
  • FY2022–2024 TSR cycle paid at 0% (below index) ; FY2025 EBITDA cycle forfeited (performance shortfall) .

| FY2025 LTI Grants to Menneto | Grant date | Type | Target/Grant | Vesting | |---|---|---:|---| | Sign-on RSUs | Aug 5, 2024 | Time-based | 58,427 units; $2,047,282 fair value | 3-year vesting (time-based) | | Annual grant – Time-based | Nov 4, 2024 | Time-based | 7,560 shares; $320,015 fair value | 4-year annual tranches | | Annual grant – Relative TSR | Nov 4, 2024 | Performance | 5,669 target shares; $298,723 fair value | 3-year; 0–200% vs Russell 2000 | | Annual grant – Adj. EBITDA | Nov 4, 2024 | Performance | 5,670 target shares; $240,011 fair value | 3-year; 0–150% based on CAGR |

Equity Ownership & Alignment

• Beneficial ownership (as of Aug 29, 2025): 45,980 shares for Menneto, including 7,560 time-based restricted shares and 19,843 performance shares assuming max performance; excludes certain RSUs vesting in future years as noted .
• No stock options are outstanding company-wide as of FY25 year-end (thus no exercisable/unexercisable overhang) .
• Hedging/pledging: Company prohibits hedging and pledging; limited pledge exceptions require CFO approval and financial capacity to repay without resort to pledged shares .

Vesting schedule indicators (potential supply):

• Aug 5, 2025: 14,363 RSUs + first tranche of 44,064 (equal annual) = 14,688 → ~29,051 units scheduled, subject to trading windows .
• Nov 6, 2025: ~1,890 time-based restricted shares (1/4 of 7,560) .
• Performance-based awards cliff-vest contingent on FY2027 outcomes (EBITDA) and Nov 2027 TSR comparison .

Stock ownership guidelines: Not explicitly disclosed in the proxy; policy prohibits hedging/pledging with a narrow exception .

Employment Terms

Key economic protections (from employment agreement):

• Start date and role: CEO effective Aug 5, 2024; director since 2024 .
• Base salary: minimum $920,000; FY2025 guaranteed bonus of at least $506,000 (55% of base). From FY2026, target bonus = 110% of base with performance criteria set by the Compensation Committee .
• Severance (non-CIC): If terminated without cause or resigns for good reason, lump-sum equal to 100% of highest salary in prior year + prior year actual bonus; certain RSUs (Bonus and Sign-On) fully vest on such termination; vesting on death/disability as specified .
• CIC (within 24 months of CIC): Cash = 200% of (salary + prior year actual bonus); time-based equity fully vests; performance-based vests at target .
• Qualified retirement: time-based vests; performance-based vests based on actual performance at end of period .
• Restrictive covenants: non-compete, non-solicit, confidentiality .

Potential payouts (as of June 30, 2025):

Clawback policy: Allows recoupment for material restatements and for fraud causing financial/reputational harm (broader than required by SEC/Nasdaq) .

Board Governance (Director Service)

• Board seat: Class II director; term through 2027 annual meeting; not independent (employee director) .
• Committee roles: None (all standing committees fully independent) .
• Board leadership: Independent Chair (Michael K. Hooks); Chair served as interim Executive Chair prior to CEO appointment; structure separates CEO and Chair roles .
• Meetings/attendance: Board met eight times in FY2025; all directors attended ≥75% of meetings of the Board/committees on which they served .
• Executive sessions: Independent directors meet regularly without management .

Dual-role implications: CEO is also a director but not Chair; independent Chair and fully independent committees mitigate concentration of power and support independent oversight .

Director/Committee Ecosystem and Shareholder Inputs

• Compensation Committee retained Exequity; no conflicts; peer group spans leisure products and adjacent sectors; target total cash around 50th percentile; LTI generally above 50th but below 75th percentile .
• Peer group examples: Winnebago, YETI, Fox Factory, Johnson Outdoors, MarineMax, MasterCraft, Vista Outdoor, etc. .
• Say-on-pay support: Over 97% approval each year since 2020; Board recommends continued annual vote frequency .

Director Compensation (for reference)

Employee directors receive no additional Board compensation .

Compensation Structure Analysis

• Mix shift and at-risk pay: LTI remains performance-heavy (60% PBRS) with 3-year cycles on TSR and EBITDA, reinforcing long-term orientation; FY2025 TSR and EBITDA awards from earlier cycles paid 0% and were forfeited, evidencing pay-for-performance sensitivity .
• Guarantee/discretion in a transition year: CEO’s first-year guaranteed minimum bonus ($506k) to induce recruitment; CFO received committee discretion bonus (~29% of target) despite plan 0%, reflecting transitional retention considerations .
• No stock options outstanding: Reduces risk of repricing; equity is restricted stock/RSUs, lowering leverage and near-term selling pressure relative to options .
• Clawback broadened beyond regulatory minimums; hedging/pledging restricted (limited pledge exception) .

Risk Indicators and Red Flags

• Hedging/pledging: Prohibited with narrow exception; no pledges disclosed in Menneto’s ownership footnote .
• Options repricing: Not applicable; no options outstanding .
• Related-party transactions: None disclosed involving Menneto; policy in place for review/approval .
• Say-on-pay: Strong historical approval mitigates compensation governance risk .
• Legal/controversies: Not disclosed in proxy.

Equity Overhang and Vesting/Selling Pressure Indicators

Note: Actual sales depend on blackout windows, personal decisions, and any 10b5-1 plans; company prohibits hedging and restricts pledging .

Investment Implications

• Alignment with shareholders: High proportion of multi-year performance equity (relative TSR and EBITDA CAGR) and recent forfeitures during weak performance indicate tight pay-performance linkage; CEO’s significant unvested time-based and performance equity creates retention and long-term alignment .
• Retention vs. dilution: Large sign-on/time-based awards provide retention during turnaround; lack of options and modest remaining plan capacity (1,027,902 shares available) limit dilution risk; no options outstanding reduces repricing risk .
• Governance mitigants: Independent Chair and fully independent committees; strong say-on-pay history; expanded clawback; anti-hedging/pledging policy—collectively positive for governance quality .
• Near-term trading supply: August and November time-based vesting tranches could create incremental float, but amounts are manageable relative to float; performance shares depend on FY2027 outcomes and TSR vs. Russell 2000 .
• Pay structure sensitivity: Annual bonus design requires both GAAP net income and Adjusted EBITDA at ≥90% of target; 2025’s 0% payout (aside from contractual/discretionary items) underscores downside sensitivity in weak cycles .