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
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FuelCell Energy, Inc.
(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 computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1)
Title of each class of securities to which transaction applies:
(2)
Aggregate number of securities to which transaction applies:
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
(4)
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(5)
Total fee paid:
Fee paid previously with preliminary materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)
Amount Previously Paid:
(2)
Form, Schedule or Registration Statement No.:
(3)
Filing Party:
(4)
Date Filed:

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NOTICE OF 2021 ANNUAL MEETING & PROXY STATEMENT
APRIL 8, 2021
 

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DEAR FELLOW FUELCELL ENERGY STOCKHOLDER
JAMES H. ENGLAND
CHAIRMAN OF THE BOARD
February 19, 2021
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On behalf of the Board of Directors of FuelCell Energy, Inc., our senior management team and all of our employees, we are pleased to invite you to the annual meeting of stockholders (the “Annual Meeting”) to be held on Thursday, April 8, 2021 at 10:00 a.m. Eastern Daylight Time. The Annual Meeting will be a completely “virtual meeting” of stockholders, conducted via live audio webcast on the Internet.
This past year we continued our transformation of FuelCell Energy. We continued to take steps and implement measures to support our growth and profitability and sustainability goals. We raised capital under our at-the-market sales plan and through offerings of our common stock, using the proceeds to repay a substantial portion of our debt, including all amounts outstanding under our senior secured credit facility with Orion Energy Partners Investment Agent, LLC and certain of its affiliated lenders, and satisfy, in full, our obligations under the Series 1 Preferred Stock. Strengthening our balance sheet positions us to continue our focus on our core competencies and commercialization of our advanced technologies in an effort to drive top-line revenue. Our stock price has experienced unprecedented growth, increasing by more than 850% since our reconvened annual meeting on May 8, 2020. Our recent achievements have been accomplished during one of the most challenging times in history due to the novel coronavirus pandemic. We are especially pleased that, through the efforts of our management team (who themselves deferred a portion of their compensation during the most challenging period of the pandemic), we were able to retain and pay our valued employees and did not resort to layoffs or furloughs that would likely have impaired our future business prospects.
While we have made substantial progress, there remains work to be done, and we will continue our focus on execution, innovation and growth in all of our businesses. We sincerely appreciate the support of our stockholders and we look forward to delivering on our shared vision of success. In order to continue the progress we have made toward our long-term goals, we need your vote.
As always, we will continue to evaluate ways in which we can improve our business and our governance and demonstrate our commitment to our stockholders. Our Board and management team remain committed to the success of our business. Thank you for your investment in FuelCell Energy, Inc.
Sincerely,
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DEAR FELLOW FUELCELL ENERGY STOCKHOLDER
JASON FEW
PRESIDENT & CHIEF EXECUTIVE OFFICER
February 19, 2021
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We are pleased to invite you to FuelCell Energy, Inc.’s Annual Meeting of Stockholders to be held on Thursday, April 8, 2021 at 10:00 a.m. Eastern Daylight Time. This year’s Annual Meeting will again be a completely “virtual meeting”, conducted via live audio webcast on the Internet. This booklet includes the Notice of Annual Meeting and the Proxy Statement.
The Proxy Statement fully describes the business we will conduct at the Annual Meeting and provides information about the Company that you should consider when voting your shares.
Your vote is very important and we request that you vote your shares as promptly as possible. We encourage you to vote your shares by proxy even if you do not plan to attend the Annual Meeting. The Board of Directors recommends the approval of the proposals being presented at the Annual Meeting as being in the best interest of the Company and its stockholders.
Sincerely,
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YOUR VOTE IS VERY IMPORTANT. WE ENCOURAGE YOU TO
VOTE YOUR SHARES BY PROXY EVEN IF YOU DO NOT
PLAN TO ATTEND THE MEETING.

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NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS
MEETING INFORMATION
THURSDAY, APRIL 8, 2021
10:00 a.m. Eastern Daylight Time
The Annual Meeting will be a completely “virtual meeting”, conducted via live audio webcast on the Internet. You will be able to attend the Annual Meeting as well as vote and submit your questions and examine our stockholder list during the live audio webcast of the meeting by visiting www.virtualshareholdermeeting.com/FCEL2021 and entering the 16-digit control number included in our notice of internet availability of the proxy materials, on your proxy card or in the instructions that accompanied your proxy materials.
ITEMS OF BUSINESS
1.
To elect five directors to serve until the 2022 Annual Meeting of Stockholders and until their successors are duly elected and qualified;
2.
To ratify the selection of KPMG LLP as FuelCell Energy, Inc.’s independent registered public accounting firm for the fiscal year ending October 31, 2021;
3.
To approve, on a non-binding advisory basis, the compensation of FuelCell Energy, Inc.’s named executive officers as set forth in the “Executive Compensation” section of the accompanying Proxy Statement;
4.
To approve the amendment of the FuelCell Energy, Inc. Certificate of Incorporation, as amended, to increase the number of authorized shares of common stock of FuelCell Energy, Inc. from 337,500,000 shares to 500,000,000 shares (the “Increase Authorized Shares Proposal”);
5.
To approve the amendment and restatement of the FuelCell Energy, Inc. 2018 Omnibus Incentive Plan, as amended and restated; and
6.
To transact such other business as may properly come before the Annual Meeting or any adjournment thereof.
RECORD DATE
Holders of record of our common stock on February 12, 2021, the record date, are entitled to notice of, and to vote at, the Annual Meeting.
MATERIALS TO REVIEW
This booklet contains our Notice of Annual Meeting and our Proxy Statement, which fully describes the business we will conduct at the Annual Meeting.
PROXY VOTING
It is important that your shares are represented and voted at the Annual Meeting. Please vote your shares according to the instructions under “How to Vote” in the Proxy Summary.
ADMISSION TO THE 2021 ANNUAL MEETING
To attend the 2021 Annual Meeting, please follow the “Meeting Attendance” instructions in the Proxy Summary.
By Order of the Board of Directors,
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JENNIFER D. ARASIMOWICZ
Executive Vice President, General Counsel,
Chief Administrative Officer
and Corporate Secretary
February 19, 2021

 
NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS
REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF FOUR WAYS:
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INTERNET
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BY TELEPHONE
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BY MAIL
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VIA WEBCAST
Visit the website on
your proxy card
Or scan the following QR Code
Call the telephone number on your proxy card
Sign, date and return your proxy card in the enclosed envelope
Attend the virtual Annual Meeting
See page 5 for instructions on how to attend
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Please refer to the proxy materials or the information forwarded by your bank, broker or other holder of record to see which voting methods are available to you.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be Held on April 8, 2021: The Notice of Annual Meeting, Proxy Statement and Annual Report to Stockholders for the fiscal year ended October 31, 2020 are available at www.proxyvote.com (using the 16-digit control number included in our notice of internet availability of proxy materials, on your proxy card or in the instructions that accompanied your proxy materials), as well as on our website at www.fuelcellenergy.com.
If you need assistance in completing your proxy card or have questions regarding the Annual Meeting, please contact MacKenzie Partners, Inc., the proxy solicitation agent for FuelCell Energy, Inc., by telephone at (800) 322-2885 (toll free) or (212) 929-5500 (collect), or by email at proxy@mackenziepartners.com.

TABLE OF CONTENTS
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FUELCELL ENERGY, INC.   3

TABLE OF CONTENTS
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A-1
4   FUELCELL ENERGY, INC.

PROXY SUMMARY
This summary highlights selected information contained throughout this Proxy Statement. Please read the entire Proxy Statement before casting your vote. For information regarding FuelCell Energy’s fiscal year 2020 performance, please review our Annual Report to Stockholders for the fiscal year ended October 31, 2020. We are making this Proxy Statement available on February 19, 2021.
ELIGIBILITY TO VOTE
Holders of record of our common stock at the close of business on February 12, 2021, the record date, are entitled to vote at the 2021 Annual Meeting of Stockholders.
HOW TO VOTE
You may vote using any one of the following methods. In all cases, you should have your 16-Digit Control Number from your proxy card or Notice of Annual Meeting available and follow the instructions. Voting will be accepted until 11:59 p.m. (EDT) on April 7, 2021:
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Online at www.proxyvote.com
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By telephone at 1-800-690-6903
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Online using your mobile device by scanning the QR Code
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By mail by voting, signing and timely mailing your Proxy Card
MEETING INFORMATION
Time and Date:
Thursday, April 8, 2021 at 10:00 a.m. (EDT)
Virtual Meeting Address:
www.virtualshareholdermeeting.com/FCEL2021
MEETING ATTENDANCE
After the success of last year’s meeting, and due to the continuing impacts of the COVID-19 pandemic, this year’s Annual Meeting will also be held entirely online to allow greater participation. Stockholders may participate in the Annual Meeting by visiting the following website www.virtualshareholdermeeting.com/FCEL2021. To participate in the Annual Meeting, you will need the 16-digit control number included on your notice, on your proxy card or on the instructions that accompanied your proxy materials. Shares held in your name as the stockholder of record may be voted electronically during the Annual Meeting. Shares for which you are the beneficial owner but not the stockholder of record may also be voted electronically during the Annual Meeting. However, even if you plan to attend the virtual Annual Meeting, the Company recommends that you vote your shares in advance, so that your vote will be counted if you later decide not to attend the Annual Meeting.
You are entitled to attend the virtual Annual Meeting only if you were a stockholder of record as of the record date for the Annual Meeting, which was February 12, 2021, or you hold a valid proxy for the Annual Meeting. You may attend the Annual Meeting, vote and submit a question during the Annual Meeting by visiting www.virtualshareholdermeeting.com/FCEL2021 and using your 16-digit control number to enter the Annual Meeting. If you are not a stockholder of record but hold shares as a beneficial owner in street name, you may be required to provide proof of beneficial ownership, such as your most recent account statement as of the record date, a copy of the voting instruction form provided by your broker, bank, trustee, or nominee, or other similar evidence of ownership. If you do not comply with the procedures outlined above, you will not be admitted to the virtual Annual Meeting.
FUELCELL ENERGY, INC.   5

 
PROXY SUMMARY
COMPANY PROFILE
FuelCell Energy is a global leader in sustainable clean energy technologies that address some of the world’s most critical challenges around energy, safety and global urbanization. FuelCell Energy is focused on four significant energy transition opportunities: (1) distributed generation, (2) distributed hydrogen, (3) long duration hydrogen energy storage and electrolysis and (4) carbon capture, separation, utilization and sequestration. As a leading global manufacturer of proprietary fuel cell technology platforms, FuelCell Energy is uniquely positioned to serve customers worldwide with sustainable products and solutions for businesses, utilities, governments and municipalities. Our solutions are designed to enable a world empowered by clean energy, enhancing the quality of life for people around the globe. Our solutions deliver multiple value streams to large-scale power users with our megawatt-class installations globally, and we currently offer sub-megawatt solutions for smaller power consumers in Europe. To provide a frame of reference, one megawatt is adequate to continually power approximately 1,000 average sized U.S. homes. We develop turn-key distributed power generation solutions and operate and provide comprehensive service for the life of the power plant. Our fuel cell solution is a clean, efficient alternative to traditional combustion-based power generation, and is complementary to an energy mix consisting of intermittent sources of energy, such as solar and wind turbines. Our customer base includes utility companies, municipalities, universities, hospitals, government entities/military bases and a variety of industrial and commercial enterprises. Our leading geographic markets are currently the United States and South Korea, and we are pursuing opportunities in other countries around the world. FuelCell Energy, based in Connecticut, was founded in 1969. Visit us online at www.fuelcellenergy.com and follow us on Twitter @FuelCell_Energy.
STOCKHOLDER VOTING MATTERS
Board & Management
Recommendation
Page Reference
(for more detail)
1.
To elect five directors to serve until the 2022 Annual Meeting of Stockholders and until their successors are duly elected and qualified
FOR each
Director Nominee
9
2.
To ratify the selection of KPMG LLP as FuelCell Energy, Inc.’s independent registered public accounting firm for the fiscal year ending October 31, 2021
FOR
51
3.
To approve, on a non-binding advisory basis, the compensation of FuelCell Energy, Inc.’s
named executive officers as set forth in the “Executive Compensation” section of the
accompanying Proxy Statement
FOR
52
4.
To approve the amendment of the FuelCell Energy, Inc. Certificate of Incorporation, as amended, to increase the number of authorized shares of common stock of FuelCell Energy, Inc. from 337,500,000 shares to 500,000,000 shares (the “Increase Authorized Shares Proposal”)
FOR
53
5.
To approve the amendment and restatement of the FuelCell Energy, Inc. 2018 Omnibus Incentive Plan, as amended and restated
FOR
55
DIRECTOR NOMINEES
Name
Age
Director
Since
Primary Occupation
James H. England*
74
2008
Chief Executive Officer of Stahlman-England Irrigation, Inc.
Jason Few
54
2018
President, Chief Executive Officer and Chief Commercial Officer of FuelCell Energy, Inc.
Chris Groobey*
55
2019
Former Partner, Wilson Sonsini Goodrich & Rosati
Matthew F. Hilzinger*
58
2015
Former Executive Vice President and Chief Financial Officer of USG Corporation
Natica von Althann*
70
2015
Former Financial Executive at Bank of America and Citigroup
*
Independent Director

Chairman of the Board of Directors
6   FUELCELL ENERGY, INC.

PROXY SUMMARY
 
ENABLING SUSTAINABILITY
At FuelCell Energy, we are focused on delivering every day on our mission to enable the world to live a life empowered by clean energy. This is core to our mission, core to our business practices, and core to the platforms and solutions we deploy around the world. Since October 2018, FuelCell Energy has been ISO 14001-2015 certified, having demonstrated the establishment of and adherence to a strict environmental management system standard that allows organizations to improve environmental performance through more efficient use of resources and reduction of waste. We believe that we are the only fuel cell manufacturer to have achieved this certification.
FuelCell Energy is a global leader in sustainable clean energy technologies that address some of the world’s most critical challenges around energy, safety and global urbanization. We are working to commercialize our hydrogen and carbon capture technologies intended to drive next generation solutions as the world strives for a net zero carbon footprint. We have the only fuel cell that is California Air Resource Board (“CARB”) certified utilizing biogas. Our proprietary carbon capture solution is the only solution that we know of that produces power rather than consuming it and is also capable of producing hydrogen for distributed applications and electrolysis.
FuelCell Energy’s clean, efficient and reliable fuel cell power platforms assist our customers in achieving their environmental and sustainability goals. Our patented technologies offer sustainable alternatives to traditional internal combustion-based power generation. Traditional power plants typically produce harmful emissions, such as nitrogen oxides, sulfur oxides and particulate matter, that are a serious public health concern. In contrast, FuelCell Energy power platforms use a combustion-free power generation process that is virtually free of pollutants. Our platforms are highly efficient and environmentally friendly products that support the “Triple Bottom Line” concept of sustainability, consisting of environmental, social and economic considerations. The following table illustrates our view of some of the key attributes and benefits of our power platforms.
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Product efficiency
The electrical efficiency of our carbonate fuel cell solutions ranges from approximately 47% to 60% depending on the configuration. When configured for combined heat and power, our system efficiencies can potentially reach up to 90%, depending on the application. This compares favorably to the average efficiency of the U.S. electrical grid of about 40%. Our solutions deliver this high electrical efficiency where the power is used, avoiding transmission. Transmission line losses average about 5% for the U.S. grid, which represents inefficiency, more emissions, and is a hidden cost to ratepayers.
Product end-of-life management
Our commitment to sustainability is evident in the design, manufacturing, installation, and servicing of our fuel cell power platforms, which are engineered for recycling and reuse. We start with a commitment to sustainability best practices as part of our corporate culture, then apply this core belief to the design, manufacture, installation, and servicing of our fuel cell power platforms. For example, when our plants reach the end of their useful lives, we have the capability to refurbish and re-use certain parts and also recycle most of what we cannot re-use. This is a departure from other power generation methods that typically produce a significant amount of waste. The balance of plant has an operating life of 25-to-30 years, at which time metals such as steel and copper are reclaimed for scrap value. For context, by weight, approximately 93% of the entire power plant can be re-used or recycled at the end of its useful life.
Our manufacturing process has a very low carbon footprint, utilizing an assembly-oriented production strategy. While we continue to enhance and adopt sustainable business practices, we recognize this is an ongoing effort with more to be accomplished, such as further reducing the direct and indirect aspects of our carbon footprint.
FUELCELL ENERGY, INC.   7

Proxy Statement
FuelCell Energy, Inc. (referred to in this Proxy Statement as “we,” “FuelCell”, “FuelCell Energy” or the “Company”) is providing you with this Proxy Statement in connection with the solicitation by FuelCell’s Board of Directors (the “Board”) of proxies to be voted at FuelCell’s 2021 Annual Meeting of Stockholders (the “Annual Meeting”) and at any adjournment or postponement thereof. This year’s Annual Meeting will be a completely “virtual meeting” of stockholders to be held on Thursday, April 8, 2021 at 10:00 a.m. Eastern Daylight Time. You will be able to attend the Annual Meeting as well as vote and submit your questions during the live audio webcast of the meeting by visiting www.virtualshareholdermeeting.com/FCEL2021 and entering the 16-digit control number included in our notice of internet availability of the proxy materials, on your proxy card or in the instructions that accompanied your proxy materials. The Company is a Delaware corporation. The address of our principal executive office is 3 Great Pasture Road, Danbury, CT 06810.
The Board has set the close of business on February 12, 2021 as the record date for the determination of holders of the Company’s common stock, par value $0.0001 per share, who are entitled to notice of, and to vote at, the Annual Meeting.
As of February 12, 2021, there were 322,414,513 shares of common stock outstanding and entitled to vote at the Annual Meeting. Holders of common stock outstanding at the close of business on the record date will be entitled to one vote for each share held on the record date.
We are providing access to our proxy materials online under the U.S. Securities and Exchange Commission’s “notice and access” rules. As a result, we are mailing to many of our stockholders a notice instead of a paper copy of this Proxy Statement and our Annual Report. The notice contains instructions on how to access documents online. The notice also contains instructions on how stockholders can receive a paper copy of our materials, including this Proxy Statement, our Annual Report, and a form of proxy card or voting instruction card. Those who do not receive a notice, including stockholders who have previously requested to receive paper copies of proxy materials, will receive a paper copy by mail unless they have previously requested delivery of materials electronically.
The Notice of Annual Meeting, Proxy Statement and proxy card are being distributed and made available to our stockholders on or about February 19, 2021.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be Held on April 8, 2021: The Notice of Annual Meeting, Proxy Statement and Annual Report to Stockholders for the fiscal year ended October 31, 2020 are available at www.proxyvote.com (using the 16-digit control number included in our notice of internet availability of proxy materials, on your proxy card or in the instructions that accompanied your proxy materials), as well as on our website at www.fuelcellenergy.com.
8   FUELCELL ENERGY, INC. | PROXY STATEMENT

PROXY STATEMENT
 
PROPOSAL 1
 ELECTION OF DIRECTORS
FuelCell’s Directors (“Directors”) are elected annually to serve one-year terms. The Board has nominated each of the five Director nominees named below to serve until the 2022 Annual Meeting of Stockholders and until his or her successor is elected and qualified or until his or her earlier resignation or removal. All of the Director nominees are currently Directors of the Company, and all of the Director nominees were elected by the stockholders at the 2020 Annual Meeting of Stockholders of the Company (the “2020 Annual Meeting”). It is the intention of the persons named as proxies to vote, if authorized, for the election of the five Director nominees named below as Directors. Each nominee has indicated his or her willingness to serve, if elected.
DIRECTOR QUALIFICATIONS AND BIOGRAPHIES
The Nominating and Corporate Governance Committee regularly assesses the performance and attributes of each Director to ensure that the Board as a governing body encompasses a broad range of perspectives, experience, diversity, integrity and commitment, in order to effectively conduct the Company’s global business while representing the long-term interests of its stockholders.
Pursuant to the recommendation of the Nominating and Corporate Governance Committee, the Board has nominated the following five candidates for election as Directors and has concluded that each of these incumbent Directors should be nominated for election based on their extensive senior leadership backgrounds, competencies and other qualifications identified below:
Director Nominee Key Characteristics and Experience include:

Technology Commercialization

Leadership

Corporate & International Finance

Manufacturing

Financial Management

Regulatory

Global Power Project Development

Legal

Government Affairs

Risk Management

Energy & Utility Sectors

Strategic Planning

Project Finance
Four of the five Director nominees are considered “Independent Directors” as such term is defined in Nasdaq Rule 5605(a)(2).
Further information about the Company’s corporate governance practices, the responsibilities and functions of the Board and its committees, Director compensation and related party transactions can be found in this Proxy Statement.
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THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE “FOR” THE PROPOSAL TO ELECT EACH OF THE FIVE NOMINEES LISTED BELOW AS DIRECTORS OF THE COMPANY TO SERVE UNTIL THE 2022 ANNUAL MEETING OF STOCKHOLDERS AND UNTIL THEIR SUCCESSORS ARE DULY ELECTED AND QUALIFIED.
DIRECTOR NOMINEES
 JAMES H. ENGLAND
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Age 74
Director
since: 2008
INDEPENDENT
Chairman of the
Board of Directors
since 2018
BIOGRAPHY:
Mr. England is a Corporate Director and has been the CEO of Stahlman-England Irrigation, Inc. since 2000. Prior to that, Mr. England spent 4 years as Chairman, President and CEO of Sweet Ripe Drinks, Ltd., a fruit beverage company. Prior to that, he spent 18 years at John Labatt Ltd. and served as that company’s CFO from 1990-1993, during which time John Labatt Ltd. was a public company with a market capitalization of over $5 billion. Mr. England started his career with Arthur Andersen & Co. in Toronto after serving in the Canadian infantry. Mr. England is a director of Enbridge Inc., and is a past member of the board of directors of John Labatt, Ltd., Canada Malting Co., Ltd., and the St. Clair Paint and Wallpaper Corporation.
SKILLS AND QUALIFICATIONS INCLUDE:

Board and Executive Level Leadership

Broad International Exposure

High Level of Financial Expertise

Extensive Energy Industry Experience

Extensive Knowledge of the Company
PRINCIPAL OCCUPATION:

Chief Executive Officer of Stahlman-England Irrigation Inc.
FUELCELL ENERGY, INC. | PROXY STATEMENT   9

 
PROXY STATEMENT
  JASON FEW
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Age 54
Director
since: 2018
BIOGRAPHY:
Mr. Few was appointed President and Chief Executive Officer in August 2019 and Chief Commercial Officer in September 2019. Prior to joining FuelCell Energy, Mr. Few served as the President of Sustayn Analytics LLC, a cloud-based software waste and recycling optimization company, since 2018, and as the Founder and Senior Managing Partner of BJF Partners, LLC, a privately held strategic consulting firm, since 2016. Mr. Few has over 30 years of experience increasing enterprise value for Global Fortune 500 and privately held technology, telecommunication, and energy firms. Mr. Few has overseen transformational opportunities across the technology and industrial energy sectors, including with Continuum Energy, an energy products and services company, where Mr. Few served as President and Chief Executive Officer from 2013 to 2016, NRG Energy, Inc., an integrated energy company, where he served in various roles including Executive Vice President and Chief Customer Officer from 2009 to 2012, Reliant Energy, a retail electricity provider, where he was President from 2009 to 2012, and Smart Energy, a retail electricity provider, where he was Senior Vice President from 2008 to 2009. Mr. Few also has served as a Senior Advisor to Verve Industrial Protection, an industrial cybersecurity software company, since 2016. Mr. Few was elected to the board of Marathon Oil (NYSE: MRO) effective April 1, 2019, and is a member of Marathon Oil’s Audit and Finance and Corporate Governance and Nominating Committees. Mr. Few is active in his community serving on the board of Memorial Hermann Hospital and formerly the American Heart Association. He earned a bachelor’s degree in computer systems in business from Ohio University. He received an MBA from Northwestern University’s J.L. Kellogg Graduate School of Management.
SKILLS AND QUALIFICATIONS INCLUDE:

Board and Executive Level Leadership

Broad Understanding of Advanced Technologies

Extensive Energy Industry Experience

Experience with Global Publicly Traded Companies

Risk Management / Oversight
PRINCIPAL OCCUPATION:

President, Chief Executive Officer & Chief Commercial Officer
 CHRIS GROOBEY
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Age 55
Director
since: 2019
INDEPENDENT
BIOGRAPHY:
Mr. Groobey joined the Board of the Company following a twenty-year career as a leading lawyer in the renewable energy industry. He was most recently a partner from 2009-2015 at the technology-focused law firm Wilson Sonsini Goodrich & Rosati and previously was a partner with the international law firm Baker & McKenzie from 2004-2009. He also practiced with the law firms Chadbourne & Parke from 1995-1999 and from 2001-2004 and Perkins Coie from 1991-1995. During Mr. Groobey’s legal career, he represented established and emerging renewable energy and energy technology companies, and the institutions that finance them, in transactions around the globe. He led numerous first-of-a-kind and deal-of-the-year transactions and was regularly selected as a leading lawyer in national and global publications. Mr. Groobey brings to the board extensive experience in corporate law and finance, project development and finance, and the development and commercialization of new energy technologies. He earned his Juris Doctor from the University of Chicago Law School and a Bachelor of Arts from Hampshire College.
SKILLS AND QUALIFICATIONS INCLUDE:

Executive Leadership

Financial Expertise

Energy Project Finance and Structuring Experience

Extensive Energy Industry Experience

Experience with Global Transactions

High Level of Legal Experience
PRINCIPAL OCCUPATION:

Former Partner at Wilson Sonsini, Goodrich & Rosati
10   FUELCELL ENERGY, INC. | PROXY STATEMENT

PROXY STATEMENT
 
 MATTHEW F. HILZINGER
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Age 58
Director
since: 2015
INDEPENDENT
BIOGRAPHY:
Mr. Hilzinger was the Executive Vice President and Chief Financial Officer of USG Corporation, an international building products company, from 2012-2019. In that position, he oversaw all financial activities as well as strategic planning. From March 2002 to 2012, Mr. Hilzinger was with Exelon Corporation, where he served as Chief Financial Officer from 2008 to 2012 responsible for finance and risk management, and as Corporate Controller from 2002 to 2008. Prior to joining Exelon, Mr. Hilzinger was Chief Financial Officer at Credit Acceptance Corporation in 2001. From 1997 to 2001, Mr. Hilzinger was at Kmart Corporation, where he last served as Vice President, Corporate Controller. From 1990 to 1997, Mr. Hilzinger was at Handleman Company, where he last served as Vice President, International Operations. Mr. Hilzinger started his career at Arthur Andersen & Co. from 1985 to 1990. Mr. Hilzinger is a graduate of the University of Michigan, with a BBA in accounting.
SKILLS AND QUALIFICATIONS INCLUDE:

Executive Leadership

High Level of Financial Expertise

Extensive Energy Industry Experience

Experience with Global Publicly Traded Companies

Risk Management / Oversight
PRINCIPAL OCCUPATION:

Former Executive Vice President and Chief Financial Officer of USG Corporation
 NATICA VON ALTHANN
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Age 70
Director
since: 2015
INDEPENDENT
BIOGRAPHY:
Ms. von Althann has served as a Director of PPL Corporation, one of the largest investor-owned utilities in the U.S. with approximately 18,000 megawatts of power generation, since December 1, 2009 and as a Director of TD Bank US Holding Company and its two bank subsidiaries, TD Bank, N.A. and TD Bank USA, N.A., since 2009. She was a founding partner of C&A Advisors, a consulting firm for financial services and risk management from 2009 to 2013, following her retirement in 2008 as the Senior Credit Risk Management Executive for Bank of America and Chief Credit Officer of U.S. Trust, an investment management company owned by Bank of America. Previously, she spent 26 years with Citigroup in various leadership roles, including Division Executive — Latin America for the Citigroup Private Bank, Managing Director and Global Retail Industry Head, and Managing Director and co-head of the U.S. Telecommunications — Technology group for Citicorp Securities.
SKILLS AND QUALIFICATIONS INCLUDE:

Board and Executive Level Leadership Experience

High Level of Banking and Financial Expertise

Broad International Exposure

Risk Management / Oversight

Exposure to Energy and Utility Sectors

Strong Focus on Strategy Development and Implementation
PRINCIPAL OCCUPATION:

Former Financial Executive at Bank of America and Citigroup
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A summary of the attributes of each of our Director nominees follows.
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CORPORATE GOVERNANCE
THE ROLE OF THE BOARD
The business affairs of the Company are managed by and under the direction of the Board. The Board and committees of the Board regularly engage with senior management to ensure management accountability, review management succession planning, review and approve the Company’s strategy and mission, execute the Company’s financial and strategic goals, oversee risk management and review and approve executive compensation.
BOARD LEADERSHIP STRUCTURE
The Board regularly evaluates its leadership structure in order to ensure that the Company effectively represents the interests of its stockholders. Our amended and restated by-laws provide the Board flexibility in determining its leadership structure. Currently, the Board maintains separate roles for the CEO and the Chairman of the Board. The Company’s President and CEO (Mr. Jason Few) is responsible for the general supervision of the affairs of the Company and is accountable for achieving the Company’s strategic goals. Mr. Few’s responsibilities include:
-
Providing strong ethical leadership;
-
Executing on the Company’s corporate strategy, and reinforcing the Company’s mission, culture and core values;
-
Ensuring complete and accurate disclosure of financial, operational and management matters to the Board;
-
Ensuring compliance and integrity of all financial and regulatory filings and other Company communications; and
-
Communicating with the Board so that it is fully informed with respect to Company, industry and corporate governance matters.
The Board’s independent Chairman (Mr. James H. England) serves as the principal representative of the Board and as such, presides at all Board meetings. The Board believes that this leadership structure, which separates the Chairman and Chief Executive Officer roles, is optimal at this time because it allows Mr. Few to focus on operating and managing our company, while Mr. England focuses on the leadership of the Board and other strategic business activities. We believe that our governance practices ensure that skilled and experienced independent directors provide independent leadership. Our Board also periodically evaluates our leadership structure to determine if it remains in our best interests based on circumstances existing at the time. In evaluating our leadership structure, our Board seeks to implement a leadership structure that will allow the Board to effectively carry out its responsibilities and best represent our stockholders’ interests, and considers various factors, including our specific business needs, our operating and financial performance, industry conditions, the economic and regulatory environment, Board and committee annual self-evaluations, advantages and disadvantages of alternative leadership structures and our corporate governance practices.
BOARD REFRESHMENT AND COMPOSITION
The Board understands the importance of adding diverse, experienced talent to the Board in order to establish an array of experience and strategic views. The Nominating and Corporate Governance Committee adheres to vigorous board refreshment efforts by thoroughly evaluating the backgrounds of potential Board candidates in addition to regularly assessing the contributions and qualifications of current Directors, to ensure that the composition of the Board and each of its committees encompasses a wide range of perspectives and knowledge. The Nominating and Corporate Governance Committee routinely looks for candidates with skill sets that are relevant to the Company and align with our business strategy and goals.
Since 2015, we have added four new, currently serving, Directors to the Board, bringing an expansive mix of expertise, diversity and insight to the Board and its committees. We believe that this is a healthy level of turnover to ensure fresh views and new perspective balanced with the continuity and stability of our experienced Directors. We believe we have a healthy mix of longer-serving Directors and those that are newer to our Board. Our five Director nominees will have an average of 5.6 years of service on our Board as of the date of the Annual Meeting.
One-fifth of our Director nominees are women and forty percent of our Director nominees are ethnically diverse.
As part of the Company’s commitment to good corporate governance practices and principles and in furtherance of Board refreshment initiatives, in 2018, the Board adopted as part of its corporate governance principles a mandatory director retirement age of 75 and set a director term limit of 12 years, subject to certain exceptions to allow for terms of up to no more than 15 years as necessary to ensure an orderly transition of Board members and leadership positions. In December, 2020, the Board made revisions to the mandatory director retirement age to allow the Board, on the recommendation of the Nominating and Corporate Governance Committee and for good cause shown, to provide up to two, one-year waivers of this retirement requirement.
In December, 2020, the Board, upon the recommendation of the Nominating and Corporate Governance Committee, voted to utilize the exception to the director term limit policy to allow Mr. England to stand for re-election at the 2021 Annual Meeting despite his having
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achieved 12 years of Board service, in order to ensure continuity of leadership, due to the small size of the Board, and in consideration for Mr. England’s leadership and capabilities.
DIRECTOR ORIENTATION
As part of our Director orientation process, each new Director is provided with orientation materials, attends a presentation by the management team with the opportunity for questions and engagement, and participates in a tour of the Company’s manufacturing facility.
MAJORITY VOTING STANDARD IN DIRECTOR ELECTIONS
In 2016, the Board approved an amendment to the Company’s by-laws to, among other changes, adopt a majority voting standard in uncontested Director elections, providing that each Director shall be elected by a majority of votes cast. Under our amended and restated by-laws, a majority of the votes cast standard requires that the number of shares voted “for” a Director must exceed the number of votes cast “against” that Director’s election. Abstentions and broker non-votes are not counted as votes cast with respect to a Director’s election.
In addition, following certification of the stockholder vote in an uncontested election, if any incumbent Director receives a greater number of votes “against” his or her election than votes “for” his or her election, the Director shall promptly tender his or her resignation to the Chairman of the Board. The Nominating and Corporate Governance Committee shall promptly consider such resignation and recommend to the Board whether to accept the tendered resignation or reject it. In deciding upon its recommendation, the Nominating and Corporate Governance Committee shall consider all relevant factors including, without limitation, the length of service and qualifications of the Director and the Director’s contributions to the Company and the Board.
CONTINUING EDUCATION AND SELF-EVALUATION
The Board believes that continuing education by the Board and management is critical to supporting the Company’s commitment to enhancing its corporate governance practices. The Board and management are therefore regularly updated on corporate governance matters, including industry and regulatory developments, strategies, operations and external trends and other topics of importance. In addition, in 2018, the Board adopted a policy requiring mandatory participation in an accredited director education program. New directors are required to complete a minimum of four hours of accredited director education within the first 180 days of election to the Board and all directors are required to complete four hours of accredited director education per fiscal year. All of our Directors met their continuing education requirements in fiscal year 2020. All of our Directors and all of our named executive officers (i.e., those executive officers named in the Fiscal Year 2020 Summary Compensation Table) are members of the National Association of Corporate Directors.
As part of the Board’s commitment to improve its performance and effectiveness, self-assessments of the Board and each of its committees are conducted annually. Results of these self-assessments are reviewed by the Nominating and Corporate Governance Committee and the full Board. In 2016, the Board added individual Director self-assessments to the self-assessment process in an effort to assess individual Director effectiveness and his or her contribution to the Board. Results of these individual Director self-assessments are also reviewed by the Nominating and Corporate Governance Committee and the full Board.
CORPORATE GOVERNANCE PRINCIPLES
The Board has adopted Corporate Governance Principles (the “Principles”) which provide the structure for the governance and best practices of the Company, in accordance with applicable statutory and regulatory requirements. The Company is committed to the highest standards of business conduct and integrity in its relationships with employees, customers, suppliers and stockholders. The Principles are reviewed annually by the Nominating and Corporate Governance Committee and updated as needed. The Corporate Governance Principles can be found in the Corporate Governance sub-section of the section entitled “Investors” on our website at www.fuelcellenergy.com.
CODE OF ETHICS
The Company is committed to high standards of ethical, moral and legal business conduct and to the timely identification and resolution of all such issues that may adversely affect the Company or its clients, employees or stockholders.
The Board has adopted a Code of Ethics (the “Code of Ethics”), which applies to the Board, our named executive officers (including our principal executive officer and our principal financial and accounting officer), and all of our other employees. The Code of Ethics provides a statement of certain fundamental principles and key policies and procedures that govern the conduct of the Company’s business. The Code of Ethics covers all major areas of professional conduct, including employment policies, conflicts of interest, intellectual property and the protection of confidential information, as well as strict adherence to all laws and regulations applicable to the conduct of our business. As
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required by the Sarbanes-Oxley Act of 2002, our Audit and Finance Committee has procedures to receive, retain, investigate and resolve complaints received regarding our accounting, internal accounting controls or auditing matters and to allow for the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters. The Code of Ethics can be found in the Corporate Governance sub-section of the section entitled “Investors” on our website at www.fuelcellenergy.com.
WHISTLEBLOWER POLICY
The Company’s Whistleblower Policy covers reporting of suspected misconduct, illegal activities or fraud, including questionable accounting, financial control and auditing matters, federal securities violations or other violations of federal and state laws or of the Company’s Code of Ethics.
We have established a written protocol with a third party vendor to ensure that all complaints received, other than with respect to our named executive officers, will be reported directly to the Company’s General Counsel, who investigates and reports as necessary directly to the Audit and Finance Committee of the Board. Any complaints received concerning our named executive officers (i.e., those executive officers named in the Fiscal Year 2020 Summary Compensation Table) are reported directly to the Chair of the Audit and Finance Committee of the Board for investigation.
The third party vendor offers anonymity to whistleblowers and assures those who identify themselves that their confidentiality will be maintained, to the extent possible, within the limits proscribed by law. No attempt will be made to identify a whistleblower who requests anonymity.
ANTI-HEDGING AND ANTI-PLEDGING POLICIES
Under the terms of the Company’s Insider Trading Policy, all Directors, officers (including, but not limited to, the named executive officers), and employees, are prohibited from engaging in any hedging transaction involving shares of the Company’s securities or the securities of the Company’s competitors, such as a put, call or short sale. Our employees and directors are also prohibited from pledging any Company securities.
COMPENSATION RECOVERY POLICY
The Company has adopted an Executive Compensation Recovery Policy that allows the Board to seek recovery of any erroneously paid incentive compensation made to any current or former executive officer of the Company in the event of an accounting restatement that results in a recalculation of a financial metric applicable to an award if, in the opinion of the Board, such restatement is due to the misconduct by one or more of any current or former executive officers. The amount subject to recoupment will, at a minimum, be equal to the difference between what the executive received and what he or she would have received under the corrected financial metrics over the three-year period prior to the restatement. Under the policy, the Board will review all performance-based compensation awarded to or earned by the executive officer on the basis of performance during fiscal periods materially affected by the restatement. If, in the opinion of the Board, the Company’s financial results require restatement due to the misconduct by one or more of any current or former executive officers, the Board may seek recovery of all performance-based compensation awarded to or earned by the executive officer during fiscal periods materially affected by the restatement, to the extent permitted by applicable law.
The Executive Compensation Recovery Policy can be found in the Corporate Governance sub-section of the section entitled “Investors” on our website at www.fuelcellenergy.com.
STOCK OWNERSHIP GUIDELINES AND HOLDING REQUIREMENTS
In 2018, the Company increased its minimum stock ownership guidelines applicable to each of its non-employee independent Directors and its executive officers. The increase represented a 6-fold increase in the prior minimum stock ownership guidelines. However, subsequent to the adoption of the increased minimum stock ownership guidelines, on May 8, 2019, the Company effected a 1-for-12 reverse stock split of the shares of the Company’s common stock, and the minimum stock ownership guidelines were adjusted to reflect the implementation of that reverse stock split. The Company increased the minimum stock ownership guidelines again in February 2020. Our current stock ownership guidelines are shown in the table below:
Position
Ownership Guideline
President and Chief Executive Officer The lesser of three times base salary or at least 300,000 shares
All Other Section 16 Executive Officers The lesser of one times base salary or at least 60,000 shares
Non-Employee Independent Directors The lesser of three times the annual cash retainer or at least 30,000 shares
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Corporate Governance
Executives subject to the guidelines must meet the ownership requirement within the later of: five years from the date they are appointed to a Section 16 Executive Officer position, or five years from the date of any change in the minimum stock ownership guidelines (in the case of the most recent change, February 2025). The non-employee independent Directors are expected to achieve target ownership levels within the later of: five years from the date of commencement of service as a Director, or five years from the date of any change in the minimum stock ownership guidelines (in the case of the most recent change, February 2025). For purposes of meeting the applicable ownership guidelines, the following shares and awards may be counted:

FuelCell Energy common stock owned (i) directly by the executive officer or Director or his or her spouse, (ii) jointly by the executive officer or Director and his or her spouse, and (iii) indirectly by a trust, partnership, limited liability company or other entity for the benefit of the executive officer or Director or his or her spouse;

100% of restricted stock and restricted stock unit awards (vested and unvested) issued under the Company’s equity incentive plans;

100% of common stock issued under the Company’s Employee Stock Purchase Plan;

100% of unexercised stock options (vested and unvested) issued under the Company’s equity incentive plans; and

100% of deferred stock units issued under the Company’s Directors Deferred Compensation Plan.
Executive officers and Directors must maintain at least 50% of the stock received from equity awards (on a shares issued basis) until the specified minimum ownership requirement level is achieved.
Once the stock ownership guideline has been achieved, executive officers will be required to maintain stock holding requirements for the duration of their employment with the Company and for Directors, until their cessation of service on the Board.
RISK OVERSIGHT
The Board has overall responsibility for the oversight of risk management at our Company. Day to day risk management is the responsibility of management, which has implemented processes to identify, assess, manage and monitor risks that face our Company. Our Board, either as a whole or through its committees, regularly discusses with management our major risk exposures, their potential impact on our Company, and the steps we take to monitor and control such exposures.
While our Board has general oversight responsibility for risk at our Company, the Board has delegated some of its risk oversight duties to the various Board committees. The Nominating and Corporate Governance Committee oversees risks related to corporate governance. The Audit and Finance Committee is responsible for generally reviewing and discussing the Company’s policies and guidelines with respect to risk assessment and enterprise risk management. The Audit and Finance Committee oversees the risk assessment and review of the financial internal controls environment and financial statement reporting compliance. The Audit and Finance Committee also considers financial risk management including risks relating to liquidity, access to capital and macroeconomic trends and risks. The Compensation Committee assists our Board in overseeing the management of risks arising from our compensation policies, and programs related to assessment, selection, succession planning, training and development of executives of the Company. Each of the Board committees reviews these risks and then discusses the process and results with the full Board.
COMMUNICATING WITH DIRECTORS
The Company has established a process by which stockholders or other interested parties can communicate with the Board or any of the Company’s individual Directors, by sending their communications to the following address:
FuelCell Energy, Inc. Board of Directors
c/o Corporate Secretary
3 Great Pasture Road
Danbury, CT 06810
Alternatively, communications can be submitted electronically via the Company website at www.fuelcellenergy.com.
Stockholder communications received by the Company’s Corporate Secretary will be delivered to one or more members of the Board or, in the case of communications sent to an individual Director, to such Director.
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Corporate Governance
 
BOARD OF DIRECTORS AND COMMITTEES
INDEPENDENT DIRECTORS AND MEETING ATTENDANCE
The Board currently consists of five directors — James H. England, Jason Few, Chris Groobey, Matthew F. Hilzinger, and Natica von Althann — each of whom will stand for election at the Annual Meeting.
The Board has determined that the following four of the five Director nominees are independent Directors, in accordance with the director independence standards of the Securities and Exchange Commission (“SEC”) and the Nasdaq Stock Market, including Nasdaq Rule 5605(a)(2): James H. England, Chris Groobey, Matthew F. Hilzinger, and Natica von Althann. The Board had previously determined that Jason Few, who served as a non-employee Director prior to his appointment as our President and CEO, was an independent Director prior to his appointment as our President and CEO in accordance with the director independence standards of the SEC and the Nasdaq Stock Market, including Nasdaq Rule 5606(a)(2). However, the Board determined that Mr. Few ceased to be independent upon his appointment as President and CEO of the Company on August 26, 2019. No other individuals served as Directors of the Company during fiscal year 2020.
The Board and its committees meet regularly to review and discuss the Company’s progress, strategy and business. The Board meets regularly with management and outside advisors. The independent Directors also hold regular executive sessions without Mr. Few or other members of management. Board members are also kept apprised of Company progress and issues that arise between Board meetings.
All Directors serving at the time of the Company’s 2020 Annual Meeting were in attendance at the meeting. Regular attendance at Board meetings and annual stockholder meetings by each Board member is expected. The Board held 30 meetings in fiscal year 2020. Each Director serving during fiscal year 2020 attended more than 75% of the total number of Board and, if a Director served on a committee, committee meetings held during fiscal year 2020.
BOARD COMMITTEES
The Board has four standing committees: the Audit and Finance Committee, the Compensation Committee, the Executive Committee and the Nominating and Corporate Governance Committee. These committees assist the Board in performing its responsibilities and making informed decisions.
The table below identifies the current members of these four standing committees:
Director
Audit and
Finance
Compensation
Executive
Nominating
and Corporate
Governance
James H. England (Chairman of the Board)
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Jason Few
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Chris Groobey
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Matthew F. Hilzinger
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Natica von Althann
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The Board believes it is more effective for the Board, as a whole, to monitor and oversee the Company’s government affairs strategy and initiatives, including federal and state legislative and regulatory proceedings, in addition to monitoring the Company’s ongoing relations with government agencies.
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Audit and Finance Committee

Current Members: Matthew F. Hilzinger, James H. England, Chris Groobey and Natica von Althann
Current Chair: Matthew F. Hilzinger
Our Committee structure changed on November 20, 2019 with the appointment of Mr. Groobey to the Board. The members of the Audit and Finance Committee in fiscal year 2020 were James H. England, Matthew F. Hilzinger, Natica von Althann and Chris Groobey (from the date of his appointment on November 20, 2019). Mr. Hilzinger was Chair of the Audit and Finance Committee throughout fiscal year 2020.
Each of the Audit and Finance Committee members satisfies the definition of independent director and is financially literate under the applicable Nasdaq and SEC rules (including those specifically applicable to audit committee members). In accordance with Section 407 of the Sarbanes-Oxley Act of 2002, the Board has designated Mr. Hilzinger and Mr. England as the Audit and Finance Committee’s “Audit Committee Financial Experts.”
The Audit and Finance Committee represents and provides assistance to the Board with respect to matters involving the accounting, auditing, financial reporting, internal controls, and legal compliance functions of the Company and its subsidiaries, including assisting the Board in its oversight of the integrity of the Company’s financial statements, compliance with legal and regulatory requirements, the qualifications, independence, and performance of the Company’s independent auditors, the performance of the Company’s service firm used to assist management in its assessment of internal controls, and effectiveness of the Company’s financial risk management. The Audit and Finance Committee routinely holds executive sessions with the Company’s independent registered public accounting firm without the presence of management.
Responsibilities of the Audit and Finance Committee include:

Overseeing management’s conduct of the Company’s financial reporting process, including reviewing the financial reports and other financial information provided by the Company, and reviewing the Company’s systems of internal accounting and financial controls;

Overseeing the Company’s independent auditors’ qualifications and independence and the audit and non-audit services provided to the Company;

Overseeing the performance of the Company’s independent auditors as well as parties engaged to assist the Company with its assessment of internal controls;

Reviewing potential financing proposals and referring them to the Board as necessary; and

Overseeing the Company’s analysis and mitigation strategies for enterprise risk (reporting any findings to the Board as necessary).
The Audit and Finance Committee held 9 meetings during fiscal year 2020. The complete Audit and Finance Committee charter can be found in the Corporate Governance sub-section of the section entitled “Investors” on our website at www.fuelcellenergy.com. The Audit and Finance Committee’s report appears on page 50 of this Proxy Statement.
Compensation Committee

Current Members: Matthew F. Hilzinger, Chris Groobey and Natica von Althann
Current Chair: Matthew F. Hilzinger
Our Committee structure changed on November 20, 2019 with the appointment of Chris Groobey as a Director. The members of the Compensation Committee in fiscal year 2020 were Matthew F. Hilzinger, Natica von Althann and Chris Groobey (from the date of his appointment on November 20, 2019). Mr. Hilzinger served as Chair of the Compensation Committee throughout fiscal year 2020.
Each of the current Compensation Committee members is an independent Director under applicable Nasdaq and SEC rules (including the rules applicable to compensation committee members), and the Compensation Committee is governed by a Board-approved charter stating its responsibilities. Members of the Compensation Committee are appointed by the Board.
The Compensation Committee is responsible for reviewing and approving the compensation plans, policies and programs of the Company to compensate the officers and Directors in a reasonable and cost-effective manner.
The Compensation Committee’s overall objectives are to ensure the attraction and retention of superior talent, to motivate the performance of the executive officers in the achievement of the Company’s business objectives and to align the interests of the officers and Directors with the long-term interests of the Company’s stockholders. To that end, it is the responsibility of the Compensation Committee to develop, approve and periodically review a general compensation policy and salary structure for executive officers of the Company, which considers business and financial objectives, industry and market pay practices and/or such other information as may be deemed appropriate.
Responsibilities of the Compensation Committee include:

Reviewing and recommending for approval by the independent Directors of the Board the compensation (salary, bonus and other
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Corporate Governance
 
incentive compensation) of the Chief Executive Officer of the Company;

Reviewing and approving the compensation (salary, bonus and other incentive compensation) of the other executive officers of the Company;

Reviewing and approving milestones and strategic initiatives relevant to the compensation of executive officers of the Company and evaluating performance in light of those goals and objectives;

Reviewing and approving all employment, retention and severance agreements for executive officers of the Company; and

Reviewing the management succession program for the Chief Executive Officer, the named executive officers and other selected executives of the Company.
The Compensation Committee acts on behalf of the Board in administering compensation plans approved by the Board in a manner consistent with the terms of such plans (including, as applicable, the granting of stock options, restricted stock, stock units and other awards, the review of performance goals established before the start of the relevant plan year, and the determination of performance compared to the goals at the end of the plan year). The Committee reviews and makes recommendations to the Board with respect to new compensation incentive plans and equity-based plans; reviews and recommends the compensation (annual retainer, committee fees and other compensation) of the Directors to the full Board for approval; and reviews and makes recommendations to the Board on changes in major benefit programs of the Company. Compensation Committee agendas are established in consultation with the Committee chair. The Compensation Committee meets in executive session at each Committee meeting.
The Compensation Committee held 13 meetings during fiscal year 2020. The complete Compensation Committee charter can be found in the Corporate Governance sub-section of the section entitled “Investors” on our website at www.fuelcellenergy.com. The Compensation Committee’s report appears on page 24 of this Proxy Statement.
Executive Committee

Current Members: Jason Few, James H. England, Matthew F. Hilzinger, Chris Groobey and Natica von Althann
Current Chair: Jason Few
During the intervals between Board meetings, the Executive Committee has and may exercise all the powers of the Board in the management of the business and affairs of the Company, in such manner as the Committee deems in the best interests of the Company, in all cases in which specific instructions have not been given by the Board. Mr. England, Mr. Hilzinger, Mr. Groobey and Ms. von Althann are independent directors under applicable Nasdaq rules. The current members of the Executive Committee were also members of the Executive Committee in fiscal year 2020, including Mr. Groobey, who joined the Committee upon his appointment to the Board on November 20, 2019.
The Executive Committee held 9 meetings during fiscal year 2020.
Nominating and Corporate Governance Committee

Current Members: Natica von Althann, Matthew F. Hilzinger, James H. England and Chris Groobey
Current Chair: Natica von Althann
Our Committee structure changed on November 20, 2019 with the appointment of Chris Groobey as a Director. The members of the Nominating and Corporate Governance Committee in fiscal year 2020 were Matthew F. Hilzinger, James H. England, Natica von Althann and Chris Groobey (from the date of his appointment on November 20, 2019). Ms. von Althann was Chair of the Nominating and Corporate Governance Committee throughout fiscal year 2020.
Each of the current members of the Nominating and Corporate Governance Committee is an independent director under applicable Nasdaq rules. Members of the Nominating and Corporate Governance Committee are appointed by the Board.
Responsibilities of the Nominating and Corporate Governance Committee include:

Identifying individuals qualified to become members of the Board and recommending the persons to be nominated by the Board for election as Directors at the annual meeting of stockholders or elected as Directors to fill vacancies;

Reviewing the Company’s corporate governance principles, assessing and recommending to the Board any changes deemed appropriate;

Periodically reviewing, discussing and assessing the performance of the Board and the committees of the Board;

Reviewing the Board’s committee structure and making recommendations to the full Board concerning the number and responsibilities of Board committees and committee assignments; and

Periodically reviewing and reporting to the Board any questions of possible conflicts of interest or related party transactions involving Board members or members of senior management of the Company.
The Nominating and Corporate Governance Committee will consider nominees for the Board recommended by stockholders. Nominations by stockholders must be in writing, and must include the full name of the proposed nominee, a brief description of the proposed nominee’s business experience for at least the previous five years, and a representation that the nominating stockholder is
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a beneficial or record owner of the Company’s common stock.
Any such submission must also be accompanied by the written consent of the proposed nominee to be named as a nominee and to serve as Director if elected. All recommendations for nomination received by the Corporate Secretary that satisfy our amended and restated by-law requirements relating to such Director nominations will be presented to the Nominating and Corporate Governance Committee for its consideration. Stockholders must also satisfy the notification, timeliness, consent and information requirements set forth in our amended and restated by-laws. Nominations must be delivered to the Nominating and Corporate Governance Committee at the following address:
Nominating and Corporate Governance Committee
FuelCell Energy, Inc.
Office of the Corporate Secretary
3 Great Pasture Road
Danbury, CT 06810
The Nominating and Corporate Governance Committee weighs the characteristics, experience, independence and skills of potential candidates for election to the Board and recommends nominees for Director to the Board for election (without regard to whether a nominee has been recommended by stockholders). In considering candidates for the Board, the Nominating and Corporate Governance Committee also assesses the size, composition and combined expertise of the Board. As the application of these factors involves the exercise of judgment, the Nominating and Corporate Governance Committee does not have a standard set of fixed qualifications that is applicable to all Director candidates, although the Nominating and Corporate Governance Committee does at a minimum assess each candidate’s strength of character, mature judgment, industry knowledge or experience, ability to work collegially with the other members of the Board and ability to satisfy any applicable legal requirements or listing standards. The Nominating and Corporate Governance Committee is committed to actively seeking highly qualified individuals, and requires a diverse candidate pool, including individuals of diverse gender and ethnicity, from which Board nominees are selected. In identifying prospective Director candidates, the Nominating and Corporate Governance Committee may seek referrals from other members of the Board, management, stockholders and other sources. The Nominating and Corporate Governance Committee also may, but need not, retain a search firm in order to assist it in identifying candidates to serve as Directors of the Company. The Nominating and Corporate Governance Committee utilizes the same criteria for evaluating candidates regardless of the source of the referral. When considering Director candidates, the Nominating and Corporate Governance Committee seeks individuals with backgrounds and qualities that, when combined with those of our incumbent Directors, provide a blend of skills and experience to further enhance the Board’s effectiveness.
In connection with its annual recommendation of a slate of Director nominees, the Nominating and Corporate Governance Committee may also assess the contributions of those Directors recommended for re-election in the context of the Board evaluation process and other perceived needs of the Board.
The Nominating and Corporate Governance Committee held 5 meetings during fiscal year 2020. The complete Nominating and Corporate Governance Committee charter, which includes the general criteria for nomination as a Director, can be found in the Corporate Governance subsection of the section entitled “Investors” on our website at www.fuelcellenergy.com.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee was an officer or employee of the Company during the fiscal year ended October 31, 2020. During the fiscal year ended October 31, 2020, none of our executive officers served as a member of the board of directors or compensation committee, or other committee serving an equivalent function, of any entity that has one or more executive officers who served as members of our Board of Directors or our Compensation Committee. During the fiscal year ended October 31, 2020, no member of the Compensation Committee had a relationship with the Company that required disclosure under Item 404 of Regulation S-K.
NASDAQ LISTING RULES — COMPENSATION COMMITTEE MEMBERS
Upon assessing the independence of the Compensation Committee members in accordance with the Nasdaq Listing Rules, the Board has determined that each Compensation Committee member satisfies the following independence criteria, in addition to qualifying as an independent director under Nasdaq Rule 5605(a)(2):

No Compensation Committee member has received compensation from the Company for any consulting or advisory services nor has any Compensation Committee member received any other compensatory fees paid by the Company (other than Directors’ fees) during the time such member served on the Compensation Committee; and

No Compensation Committee member has an affiliate relationship with the Company, a subsidiary of the Company or an affiliate of a subsidiary of the Company.
NASDAQ LISTING RULES — COMPENSATION COMMITTEE ADVISOR
Upon assessing the independence of, and any potential conflicts of interest of, the Company’s Compensation advisor, Meridian Compensation Partners, LLC (“Meridian”), in accordance with the Nasdaq Listing Rules, the Compensation Committee has determined that Meridian satisfies the following independence criteria:

Meridian has not provided, in the last completed fiscal year ended October 31, 2020 or any subsequent interim period, any services to the Company or its affiliated companies, other than Meridian’s work as a compensation advisor to the Company’s Compensation Committee;
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Corporate Governance
 

Less than 1% of Meridian’s total revenue was derived from fees paid by the Company in the last completed fiscal year ended October 31, 2020 and any subsequent interim period for work on behalf of the Company’s Compensation Committee;

Meridian has implemented policies and procedures designed to prevent conflicts of interest;

Neither Meridian nor any of its employees or their spouses has any business or personal relationships with any members of the Company’s Compensation Committee or any of the Company’s executive officers;

Neither Meridian nor any of its employees or their immediate family members currently owns any Company securities (other than through a mutual fund or similar externally-managed investment vehicle); and

Meridian is not aware of any relationship not identified in the statements above that could create an actual or potential conflict of interest with the Company or its affiliated entities, any members of the Company’s Compensation Committee or any of the Company’s executive officers.
FUELCELL ENERGY, INC. | PROXY STATEMENT   21

BIOGRAPHIES OF EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
 MICHAEL S. BISHOP
[MISSING IMAGE: PH_MICHAELS-BISHOP.JPG]
Age 53
Mr. Bishop was appointed Executive Vice President in June 2019 and has served as the Company’s Chief Financial Officer and Treasurer since June 2011. Mr. Bishop previously served as Senior Vice President of the Company from June 2011 to June 2019. He has more than 20 years of experience in financial operations and management with public high growth technology companies with a focus on capital raising, project finance, debt/treasury management, investor relations, strategic planning, internal controls, and organizational development. Since joining the Company in 2003, Mr. Bishop has held a succession of financial leadership roles, including Assistant Controller, Corporate Controller and Vice President and Controller. Prior to joining FuelCell Energy, Mr. Bishop held finance and accounting positions at TranSwitch Corporation, Cyberian Outpost, Inc. and United Technologies, Inc. He is a certified public accountant and began his professional career at McGladrey and Pullen, LLP (now RSM US LLP). Mr. Bishop also served four years in the United States Marine Corps.
Mr. Bishop received a Bachelor of Science in Accounting from Boston University and a MBA from the University of Connecticut.
PRINCIPAL OCCUPATION:

Executive Vice President, Chief Financial Officer and Treasurer
 JENNIFER D. ARASIMOWICZ
[MISSING IMAGE: PH_JENNIFERD-ARASIMOWICZ.JPG]
Age 49
Ms. Arasimowicz was appointed Chief Administrative Officer in September 2019 and has served as Executive Vice President since June 2019, and General Counsel and Corporate Secretary since April 2017. In her current position (and in her prior positions), Ms. Arasimowicz, a licensed attorney in Connecticut, New York and Massachusetts, is (and was) the chief legal officer, chief administrative officer, and chief compliance officer of the Company, having responsibility for oversight of all of the Company’s legal, administrative and government affairs, and providing leadership in all aspects of the Company’s business, including compliance, corporate governance and board activities. Ms. Arasimowicz joined the Company in 2012 as Associate Counsel and was promoted to Vice President in 2014 and Senior Vice President in 2016. Ms. Arasimowicz also previously served as Interim President from June 2019 to August 2019 and as Chief Commercial Officer from June 2019 to September 2019. Prior to joining the Company, Ms. Arasimowicz served as General Counsel of Total Energy Corporation, a New York based diversified energy products and services company providing a broad range of specialized services to utilities and industrial companies. Previously, Ms. Arasimowicz was a partner at Shipman & Goodwin, LLP in Hartford, Connecticut, chairing the Utility Law Practice Group and began her legal career as an associate at Murtha Cullina, LLP.
Ms. Arasimowicz earned her Juris Doctor at Boston University School of Law and holds a bachelor’s degree in English from Boston University.
PRINCIPAL OCCUPATION:

Executive Vice President, General Counsel, Chief Administrative Officer and Corporate Secretary
 MICHAEL J. LISOWSKI
[MISSING IMAGE: PH_MICHAELLISOW-4CLR.JPG]
Age 51
Mr. Lisowski was appointed Executive Vice President and Chief Operating Officer in June 2019. Mr. Lisowski has served as the Company’s Vice President of Global Operations since 2018, and, from 2001 to 2018, held various other positions within the Company, including Vice President of Supply Chain from 2010 to 2018. Mr. Lisowski is a senior global operations leader with 28 years of progressive operations experience in technology-driven businesses. In his position as the Company’s Chief Operating Officer (and in his prior position as the Company’s Vice President of Global Operations), Mr. Lisowksi is (and was) responsible for the Supply Chain, Manufacturing, Quality, Project Management, Environmental Health and Safety, and Plant Engineering functions of the Company. Additionally, Mr. Lisowski and his team are responsible for the development and qualification of strategic suppliers for critical direct materials, as well as procurement of capital equipment in support of operations.
Mr. Lisowski earned his Bachelor’s Degree in Communications and Business Administration at Western New England University and a Master’s Degree in Management, Global Supply Chain Integrations from Rensselaer Polytechnic Institute.
PRINCIPAL OCCUPATION:

Executive Vice President and Chief Operating Officer
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 ANTHONY J. LEO
[MISSING IMAGE: PH_ANTHONYLEO-4CLR.JPG]
Age 63
Mr. Leo was appointed Executive Vice President and Chief Technology Officer in June 2019 and, prior to that, served as Vice President of Applications and Advanced Technologies since 2014. From 1978 to 2014, Mr. Leo has held various other positions with the Company, including Vice President of Application Engineering and Advanced Technology Development, Vice President of Applications and OEM Engineering, and Vice President of Product Engineering. Mr. Leo has held key leadership roles in the Company’s research, development, and commercialization of stationary fuel cell power plants for more than 30 years. In his current position and in his position as the Company’s Vice President of Applications and Advanced Technologies, Mr. Leo is and has been responsible for Applications and Advanced Technology Development. In Mr. Leo’s other positions with the Company, he has been responsible for managing advanced research and development of rechargeable batteries and fuel cells, managing the first large-scale demonstration stationary fuel cell project, and establishing the Product Engineering Group.
Mr. Leo earned his Bachelor of Science Degree in Chemical Engineering from Rensselaer Polytechnic Institute and has served on the U.S. Department of Energy Hydrogen and Fuel Cell Technical Advisory Committee.
PRINCIPAL OCCUPATION:

Executive Vice President and Chief Technology Officer
FUELCELL ENERGY, INC. | PROXY STATEMENT   23

EXECUTIVE COMPENSATION
TABLE OF CONTENTS
24
24
36
37
38
39
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis as set forth in this Proxy Statement. Based upon this review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be incorporated by reference in the Company’s Annual Report on Form 10-K for its fiscal year ended October 31, 2020 and included in the Company’s 2021 Proxy Statement filed in connection with the Company’s 2021 Annual Meeting of Stockholders.
Respectfully submitted by the Compensation Committee of the Board of Directors.
Matthew F. Hilzinger (Chair)
Chris Groobey
Natica von Althann
COMPENSATION DISCUSSION AND ANALYSIS
INTRODUCTION AND SUMMARY
This Compensation Discussion and Analysis describes the philosophy and objectives of the executive compensation program underlying the compensation which is reported in the executive compensation tables included in this Proxy Statement for the following current executive officers of the Company (the “NEOs” or “named executive officers”):
JASON FEW
President, Chief Executive Officer and Chief Commercial Officer (the “CEO”)
MICHAEL S. BISHOP
Executive Vice President, Chief Financial Officer and Treasurer (the “CFO”)
JENNIFER D. ARASIMOWICZ
Executive Vice President, General Counsel, Chief Administrative Officer and Corporate Secretary (the “GC”)
MICHAEL J. LISOWSKI
Executive Vice President and Chief Operating Officer (the “COO”)
ANTHONY J. LEO
Executive Vice President and Chief Technology Officer (the “CTO”)
The total compensation of each NEO is reported in the Fiscal Year 2020 Summary Compensation Table presented on page 36 of this Proxy Statement.
Our compensation program is intended to motivate and incentivize our executive officers to achieve our corporate objectives and increase stockholder value. The Compensation Committee continues to evaluate how best to structure our compensation program to ensure that our executives are being appropriately and competitively compensated while also maintaining compensation levels commensurate with our business performance. During fiscal year 2020, as part of our effort to better align our compensation program with best practices, we utilized the services of our new compensation consultant, Meridian Compensation Partners, LLC (“Meridian”), to evaluate our executive compensation programs. Additionally, we engaged in a stockholder outreach campaign as further described below. Our fiscal year 2020 compensation program was informed by these efforts.
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Executive Compensation
 
EXECUTIVE COMPENSATION HIGHLIGHTS
At our 2018 and 2019 annual meetings, approximately 66% and 48%, respectively, of the shares voted on the “say-on-pay” proposal were cast in support of our executive compensation. These adverse votes sent a strong message to our Board that action was needed to address stockholder concerns and improve our compensation program. We commenced that work in fiscal year 2019 and have continued our efforts to restore stockholder confidence in our executive compensation program. We have taken the following actions to address stockholder concerns and improve our executive compensation program:

At the end of fiscal year 2019, the Compensation Committee retained a new compensation consultant, Meridian, who immediately reviewed and recommended changes to the Company’s peer group;

The Compensation Committee engaged with the assistance of Meridian in an intensive review of the prior compensation program to understand specific concerns of stockholders and proxy advisory firms. With the assistance of Meridian, the Compensation Committee also reviewed the executive compensation practices of the Company’s peers and considered best practices;

Members of management and the Board conducted extensive stockholder outreach to discuss our compensation practices, governance, philosophy and strategy;

This review culminated in the Compensation Committee’s approval and implementation of a new, performance-based long-term incentive program that the Committee believes addresses the most fundamental stockholder concern of pay for peformance, as further described below; and

The Compensation Committee reviewed its disclosure practices with respect to milestones and strategic initiatives associated with the Management Incentive Plan, and in this Compensation Discussion and Analysis has endeavored to provide greater transparency and disclosure of targets and achievements.
While say-on-pay support improved to 86% at our 2020 Annual Meeting, the Compensation Committee continues to consider input from stockholders in making compensation decision and reviewing executive compensation programs and policies.
COMPENSATION POLICIES AND PRACTICES
During fiscal year 2020, we maintained the following compensation-related governance policies and practices, including both policies and practices we have implemented to drive performance and policies and practices that either prohibit or minimize behaviors that we do not believe serve our stockholders’ long-term interests.
What We Do:

Maintain an Independent Compensation Committee – Our Compensation Committee consists solely of independent directors who establish our compensation practices.

Retain an Independent Compensation Advisor – Our Compensation Committee has engaged its own compensation consultant to provide information, analysis, and other advice on executive compensation independent of management. At the end of fiscal year 2019, we changed our compensation consultant to take a fresh look at our compensation practices.

Annual Executive Compensation Review – At least once a year, our Board conducts a review of our compensation strategy, and during fiscal year 2020, we did an in-depth review of our compensation program.

Compensation At-Risk – Our executive compensation program is designed so that a significant portion of the compensation of our executive officers is “at risk” based on corporate performance, to align the interests of our executive officers and stockholders.

Stock Ownership Guidelines – We maintain minimum stock ownership guidelines and stock holding requirements applicable to our executive officers and the non-employee independent members of our Board. In December 2018, our Board approved a six-fold increase in these minimum stock ownership guidelines, however, the minimum stock ownership guidelines were then reduced in connection with the one-for-twelve reverse stock split effected in May 2019. Accordingly, we again increased our minimum stock ownership guidelines in February of 2020. As of October 31, 2020, each of our executive officers satisfied the minimum stock ownership policy requirements.

Compensation Recovery (“Clawback”) Policy – We maintain an Executive Compensation Recovery Policy that enables our Board to seek recovery of any erroneously paid incentive compensation received by any current or former executive officer of the Company (who was actively employed as an executive officer of the Company on or after December 18, 2014, the date this policy was first adopted) in the event of an accounting restatement.

Conduct an Annual Stockholder Advisory Vote on NEO Compensation – We conduct an annual stockholder advisory vote on the compensation of our NEOs. Our Board considers the results of this advisory vote during the course of its deliberations on executive compensation.

Compensation-Related Risk Assessment – We conduct regular risk assessments of our compensation programs and practices, and a full risk assessment was completed by our independent compensation consultant subsequent to the end of fiscal year 2020 and reviewed by our Compensation Committee.
FUELCELL ENERGY, INC. | PROXY STATEMENT   25

 
Executive Compensation

“Double-Trigger” Change in Control Arrangements – We have established “double-trigger” change-in-control severance agreements with each of our NEOs, with a payment equal to two times base salary, plus the target annual bonus, plus the pro-rata amount of the bonus that would have been paid during the year of termination, pro-rated for the number of days during the year employed (for Mr. Few) and payments of one times base salary plus the average of the bonuses paid since their appointment as executive officers of the Company (for Messrs. Bishop, Lisowski and Leo and Ms. Arasimowicz).
What We Do Not Do:

No Guaranteed Bonuses – Other than the one-time signing bonus previously paid to Mr. Few, we do not provide guaranteed annual bonuses to our executive officers.

No Defined Benefit Retirement Plans – We do not currently offer, nor do we have plans to offer, defined benefit pension plans or any non-qualified deferred compensation plans or arrangements to our NEOs other than arrangements that are available generally to all employees. Our NEOs are eligible to participate in our 401(k) retirement plan on the same basis as our other employees.

Prohibition on Hedging and Pledging – We maintain a policy that prohibits our employees, including our NEOs, and members of the Board, from hedging or pledging any Company securities.

No Tax Gross-Ups – We do not offer our NEOs any tax “gross-ups.”

No Stock Option Re-pricing – We do not permit options to purchase shares of our common stock to be repriced to a lower exercise price without the approval of our stockholders.
COMPENSATION PHILOSOPHY AND OBJECTIVES
The Compensation Committee is responsible for developing and reviewing executive compensation plans, policies and practices consistent with our compensation philosophy. Our compensation philosophy is designed around certain key objectives:

Attract and Retain Top Executive Talent – We have designed our compensation program to be competitive and cost-effective, while allowing us to attract and retain executives critical to our long-term success.

Pay for Performance – Our compensation program aligns compensation with Company and individual performance on both a short-term and long-term basis.

Significant Portion of Pay is in the Form of Variable Compensation – We have aligned NEO compensation with stockholder interests by tying a significant portion of total direct compensation to the achievement of performance goals or stock price appreciation. With variable compensation, the NEO will not realize value unless performance goals are met or our stock price appreciates.
To achieve these objectives, our executive compensation program:

must be competitive with compensation paid by companies in the same or similar markets for executive talent;

rewards performance by linking compensation to Company performance and achievement of corporate performance goals;

aligns realized compensation with long-term stockholder returns by delivering a significant portion of NEO compensation in the form of equity compensation, the value of which is directly linked to our stock price;

aligns NEO and stockholder interests by requiring NEOs to own and hold our stock for a specified period of time;

is comprised of a “fixed” component, which consists of base salary, health and welfare benefits and contributions to the Company’s Section 401(k) Retirement Savings plan (the “401(k) Plan”), which benefits and contributions are the same as those offered to all other employees; and

has a “variable” component, which consists of an annual performance-based incentive award (the target amount of which is expressed as a percentage of base salary) and a long-term incentive award linked to individual and Company performance.
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Executive Compensation
 
COMPENSATION OVERVIEW
The following table presents a summary of the key components of our executive compensation program and the purpose of each such component.
Compensation Component
Purpose
FIXED
Base Salary
Paid in cash
√ Provide a competitive fixed rate of pay relative to similar positions in the market.
√ Enable the Company to attract and retain critical executive talent.
AT RISK
Annual or Short-Term Incentives
Paid — to the extent that performance goals are achieved — annually in cash under the Management Incentive Plan (MIP)
√ Focus executive officers on achieving progressively challenging short-term performance goals that align with the Company’s annual operating plan and result in long-term value creation.
AT RISK
Long-Term Incentives
Paid — to the extent vesting criteria are met — under the Long-Term Incentive (LTI) Plan in equity
√ Historically, when long-term incentive equity awards were granted, they were granted as time-based restricted stock awards or restricted stock units.
√ In fiscal year 2020, the Compensation Committee with the assistance of its independent compensation consultant, implemented a new Long-Term Incentive Plan with a balanced mix of performance-based restricted stock units and time-based restricted stock units that focus our executive officers on longer-term relative and absolute performance goals that strongly align with and drive stockholder value creation, as well as support the Company’s leadership retention strategy.
In addition, all of our executives are entitled to participate in the Company’s benefit programs to the same extent as our other employees, as discussed further under the “Benefits and Perquisites” section on page 30 of this Proxy Statement. Historically, the Company has not provided perquisites to our executives. However, certain limited perquisites were granted to Mr. Few to induce him to join the Company as our President and CEO, as discussed in the “CEO Employment Agreement” section on page 30 of this Proxy Statement.
STOCKHOLDER OUTREACH AND RECENT INITIATIVES
Engagement with our stockholders is a key component of the Company’s corporate governance practices and the Company strongly believes stockholder engagement is of vital importance. Our engagement is designed to (1) discuss and receive feedback on our business, strategy and philosophy, (2) gain insight and perspective on our governance and executive compensation practices, and (3) establish and maintain an open line of communication between the Company and our stockholders.
As part of our routine stockholder outreach, our CEO, Chief Financial Officer and other senior members of management conduct regular investor communications, including conferences, non-deal road shows and individual and group conference calls with portfolio managers and industry analysts. Each quarter’s earnings results are reviewed and discussed in open investor conference calls with broad participation and Q&A by the analyst community. Our senior management regularly makes themselves available for such communications, typically focusing on elements of our strategic plans, consolidated business results and capital structure, and other topics of interest to stockholders. We believe that management can strengthen its ability to lead the Company and execute on its Powerhouse business strategy by constructively discussing our business and strategy in such settings.
The Company significantly increased its engagement efforts with its stockholders during the last fiscal year. During the last nine months of fiscal year 2020, the senior management team conducted a stockholder outreach program to introduce the new senior leadership of the Company and discuss the Company’s new strategy. In fiscal year 2020, as part of our increased outreach campaign, our CEO and Chief Financial Officer, other members of our senior management team and, in certain cases, the Chairman of the Board and the Chairman of the Compensation Committee, met with stockholders and held investor meetings by teleconference or video conference. In total, during the last nine months of fiscal year 2020, management invited our top 150 stockholders to meet. These stockholders represented approximately 32% of our outstanding shares as of the date of our reconvened 2020 Annual Meeting on May 8, 2020. Of those contacted, management and Board members spoke with 77 stockholders and institutions, including 10 of our largest 20 stockholders as of the date of our reconvened 2020 Annual Meeting. Also during fiscal year 2020, the Company participated in 3 investor conferences and non-deal road shows in order to make its management team accessible to investors.
During all such calls and meetings, the Board members and senior members of management solicited feedback from stockholders that is taken into account by the Board and management in making strategic, corporate governance and compensation decisions. Not all investors we spoke with expressed the same views about each topic discussed during our calls, but we listened carefully to each and gave each equal weight.
FUELCELL ENERGY, INC. | PROXY STATEMENT   27

 
Executive Compensation
We believe that the positive dialogue with stockholders during our fiscal year 2020 outreach campaign has promoted transparency and accountability, helping us to respond in a better manner to the interests of our stockholders and to adjust to evolving governance and compensation expectations.
Recurring themes in our stockholder outreach included (1) a desire for greater emphasis on performance-based equity awards rather than time-based equity awards for our NEOs to better align long-term incentive compensation with Company performance and (2) a desire for greater transparency in describing the milestones, strategic initiatives and achievements associated with our management incentive plan and the award of bonuses. In response, the Board undertook to re-evaluate our executive compensation practices, with specific focus on better aligning long-term incentive compensation with Company performance. The Board also committed to greater transparency in its executive compensation practices and target achievements, as reflected below.
COMPENSATION-SETTING PROCESS
The Compensation Committee reviews the base salary, target annual incentive award, long-term incentive award and target total direct compensation opportunity (which represents the sum of these three elements) for each of the NEOs annually. The CEO makes recommendations to the Compensation Committee for annual increases in base salary, the annual incentive award payments and long-term incentive awards for each of the NEOs (other than with respect to his own compensation), taking into account the recommendations of the Board’s independent compensation consultant. The Compensation Committee has the final authority to approve annual increases in base salary, annual incentive award payments and long-term equity incentive awards for the NEOs other than the CEO, whose compensation is approved by the independent members of our Board.
Prior to the start of each fiscal year, the CEO develops operational milestones and strategic or operational initiatives for the year for our salaried employees, including the NEOs. These operational milestones and strategic or operational initiatives represent key performance objectives which are incorporated into the MIP, which is then submitted to the Compensation Committee for consideration and approval. After our fiscal year-end financial results are available, the annual incentive award pool for employees and individual annual incentive award payments for the NEOs for the just-completed fiscal year are approved by the Compensation Committee, except with respect to the CEO, whose annual incentive award payment is approved by the independent members of our Board.
The Compensation Committee formulates its compensation decisions for the NEOs with input from the CEO (other than with respect to his own compensation), considering such factors as each NEO’s professional experience, job scope, past performance, tenure and retention risk. The Compensation Committee also considers prior fiscal year adjustments to compensation, historical annual incentive award payments and long-term incentive awards. Finally, the Compensation Committee considers current market practices, based on its review of executive compensation data for comparable companies, as well as current compensation trends, to ensure that the compensation of the NEOs is both competitive and reasonable, while also maintaining compensation levels commensurate with our financial and stock performance.
From 2010 through fiscal year 2019, the Compensation Committee engaged Compensia, Inc., a national compensation consulting firm, to support its compensation planning activities. At the end of fiscal year 2019, the Compensation Committee retained a new compensation consulting firm, Meridian Compensation Partners, LLC (“Meridian”), to conduct a wholesale review of the Company’s executive compensation practices and suggest modifications.
In fiscal year 2020, Meridian did not provide any other services to the Company and Meridian worked with management only on matters for which the Compensation Committee is responsible.
Based on its consideration of the various factors set forth in the rules promulgated by the SEC and the Nasdaq Marketplace Rules, the Compensation Committee has determined that the work performed by Meridian has not raised any conflict of interest.
COMPETITIVE POSITIONING
We periodically perform a competitive market analysis of our executive and Director compensation programs to ensure that the total compensation packages of our executive officers and the non-employee members of our Board are within a reasonably competitive range. In connection with its fiscal year 2020 compensation actions and decisions, the Compensation Committee considered the competitive market analysis that was prepared by Meridian at the beginning of fiscal year 2020. In sum, the Meridian analysis demonstrated that the Company’s overall compensation programs were generally aligned with typical market practices, although Meridian recommended changes to the Company’s long-term incentive program to better align pay with performance.
COMPETITIVE MARKET ANALYSIS
In early 2020, Meridian conducted a competitive market analysis that was used by the Compensation Committee in connection with its executive and non-employee Director compensation decisions for fiscal year 2020 and fiscal year 2021. To develop an understanding of the competitive marketplace, the Compensation Committee reviewed the executive compensation practices of a group of publicly-traded companies (the “Peer Group”) based on compensation data gathered from publicly-available filings.
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Executive Compensation
 
Meridian worked with the Compensation Committee to review the Company’s Peer Group, which had undergone a substantial refresh in 2018, with almost half of the companies utilized in 2018 being different than the peer companies that had been utilized in 2017.
The Compensation Committee and Meridian reviewed and considered factors such as revenue growth, profitability, valuation (for example, market capitalization as a multiple of sales) and business model in determining the Peer Group to be utilized in making compensation decisions for fiscal year 2020 and fiscal year 2021. The Peer Group was selected based on the subjective evaluation of all of these factors, and consisted of the following 17 companies:
American Superconductor
Orion Energy Systems
Amyris
Park Electrochemical
Ballard Power Systems
Plug Power
Broadwind Energy
Thermon Group Holdings
Capstone Turbine
Ultralife
CECO Environmental
Vicor
Clean Energy Fuels
Vishay Precision Group
Digi International
Westport Fuel Systems
EMCORE
The Compensation Committee uses the market analysis as a reference point to ensure that our executive compensation program is competitive with market practice. In the case of each executive officer, the Compensation Committee compares the overall compensation of each individual against the compensation data developed through the market analysis, if his or her position is sufficiently similar to the positions identified in the data to make the comparison meaningful. However, the Compensation Committee reviews a full array of competitive market data rather than isolating and targeting a particular percentile with respect to any portion of the executives’ pay. Ultimately, the Compensation Committee’s decisions with respect to each executive’s total compensation, and each individual compensation element, are based in large part on its assessment of Company and individual performance as well as other factors, such as internal equity.
FIXED COMPENSATION
BASE SALARY
The purpose of base salary, from the perspective of the Compensation Committee, is to fairly and competitively compensate our NEOs with a fixed amount of cash for the jobs they perform. In addition, base salaries are used to recognize the experience, skills, knowledge and responsibilities required of our NEOs. Accordingly, we seek to ensure that base salary levels are competitive and consistent with industry practices.
FISCAL YEAR 2020 BASE SALARIES
During fiscal year 2020, our focus was primarily on strengthening our balance sheet to support our planned growth and operations following our fiscal year 2019 restructuring. During fiscal year 2020, the Compensation Committee reviewed the base salaries of the executive officers, taking into consideration their qualifications, past performance and expected future contributions, their ongoing roles and responsibilities and the challenges facing the Company. After considering the foregoing factors and certain additional information, including the roles each of our executive officers played in the Company’s restructuring, the Compensation Committee determined that the base salaries established during fiscal year 2019 were sufficient to recognize the contributions that each individual had made during the preceding 12 months, to address the Company’s retention objectives, and to ensure parity in the base salary levels of the executive officers after taking into consideration their relative time in their positions and their anticipated future contributions to the Company. With respect to the new CEO, Jason Few, the Compensation Committee recommended to the independent members of our Board that his fiscal year 2019 base salary remain the same for fiscal year 2020 (which recommendation was approved by the independent members of the Board). Accordingly, the base salaries of the NEOs for fiscal year 2020 remained the same as they were in fiscal year 2019 as shown in the table below.
Base Salaries
Name
2019 Base
($)
2020 Base
($)
Increase
($)
Increase
%
Mr. Few
475,000 475,000 0 0
Mr. Bishop
385,000 385,000 0 0
Ms. Arasimowicz
365,000 365,000 0 0
Mr. Lisowski
325,000 325,000 0 0
Mr. Leo
275,000 275,000 0 0
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Executive Compensation
During the early onset of the COVID-19 pandemic, as part of the efforts by the Company to mitigate the financial and operational impacts of the pandemic, our NEOs deferred a portion of their salaries for three months.
BENEFITS AND PERQUISITES
We offer medical and dental insurance to our executive officers, and pay a portion of the premiums for these benefits consistent with the arrangements for non-executive employees. We also provide our executive officers and other eligible employees, at our expense, with group life and accidental death and dismemberment insurance benefits; short-term and long-term disability insurance benefits; paid time off benefits; and other ancillary benefits (for example, flexible spending accounts and an employee assistance program). Further, we offer participation in the 401(k) Plan to our employees, including our executive officers, subject to the terms of the 401(k) Plan.
Contributions to the 401(k) Plan are limited to an annual maximum amount as determined by the Internal Revenue Service. For Plan Year 2020, the Compensation Committee approved continuing a matching contribution equal to 25% of the first 8% of elective salary deferrals, not to exceed 2% of eligible earnings. These contributions to the retirement savings accounts of our employees are subject to a five year graded vesting schedule. Participants are not permitted to receive or purchase shares of our common stock through the 401(k) Plan. Our contributions to the retirement savings accounts of the NEOs for fiscal year 2020 are set forth in the Fiscal Year 2020 Summary Compensation Table on page 36 of this Proxy Statement.
Our executive compensation program does not include any of the following pay practices:

Supplemental executive retirement benefits; or

Supplemental health or insurance benefits.
CEO EMPLOYMENT AGREEMENT
Pursuant to his employment agreement, Mr. Few received a one-time signing bonus of $500,000, 50% of which was paid effective upon Mr. Few’s commencement of employment in August 2019 and the other 50% of which was paid on January 6, 2020. Mr. Few also receives $13,000 per month in commuting expenses, which, pursuant to the first amendment to Mr. Few’s employment agreement dated April 23, 2020 (the “First Amendment”), was to be paid through February 26, 2021. In addition, the Company paid Mr. Few’s rent for his Connecticut apartment in an amount equal to $2,361 per month, which was to be paid through February 26, 2021. Due to the travel impacts of the COVID-19 pandemic, on January 19, 2021, we entered into a Second Amendment to Mr. Few’s employment agreement (the “Second Amendment”). Pursuant to the Second Amendment, Mr. Few’s commuting expenses were replaced with a monthly reimbursement of his actual commuting expenses incurred, subject to a limit of $13,000 per month, and the period of time during which the Company will pay certain of Mr. Few’s apartment expenses was extended until October 31, 2021. The Second Amendment further provided for an extension of time until October 31, 2021 for the Company’s reimbursement of travel expenses for Mr. Few’s spouse for two trips to facilitate Mr. Few’s relocation to Connecticut and provided for payment of $200,000 in relocation expenses to Mr. Few subject to his relocation to Connecticut prior to October 31, 2021. Mr. Few is also entitled to up to $10,000 annually in tax preparation fees and $10,000 annually in organization and membership dues.
VARIABLE COMPENSATION
ANNUAL INCENTIVE COMPENSATION
All salaried exempt employees, including our executive officers, are eligible to participate in our annual cash bonus plan, which we refer to as the Management Incentive Plan or the “MIP”. The MIP is intended to motivate employee performance in, and align compensation levels with, the achievement of our annual business objectives.
The Compensation Committee periodically reviews and determines the target annual incentive award opportunities (expressed as a percentage of base salary) that each of the executive officers may earn under the MIP. The target annual incentive award opportunities for each NEO (expressed as a percentage of base salary) were established in each of their respective employment agreements, at 90% for Mr. Few (established in 2019), and at 50% for each of the other NEOs (established in 2011 for Mr. Bishop, in 2017 for Ms. Arasimowicz and in 2019 for Mr. Leo and Mr. Lisowski).
The actual amount of annual cash compensation earned under the MIP each year by our NEOs may be more or less than the target amount depending on our performance against a set of pre-established Company operational milestones (which represent 75% of their target annual incentive award opportunity) and a set of pre-established Company strategic or operational initiatives (which represent the remaining 25% of their target annual incentive award opportunity). In addition, the Compensation Committee retains the right to exercise its discretion to adjust the size of potential award payments as it deems appropriate to take into account factors that enhance or detract from results achieved relative to the Company operational milestones and strategic or operational initiatives. In this way, the Compensation Committee does not confine itself to a purely quantitative approach and retains discretion in determining award payments based on its review and assessment of other results for the fiscal year. The Compensation Committee believes that linking the annual incentive awards for the NEOs to Company operational milestones and strategic or operational initiatives creates a performance-based compensation
30   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
opportunity that furthers stockholder interests, but by retaining some discretion, reduces the risk that executives will overemphasize performance on the pre-established objectives to the detriment of the Company’s overall performance. Retaining limited discretion allows the Compensation Committee to ultimately conduct a more fulsome performance assessment that recognizes industry-specific and broader macroeconomic trends that have impacted the business and the Company’s opportunities and performance during the course of the year.
The operational milestones and strategic initiatives on which the 2020 MIP awards were based, as well as our performance with respect to such milestones and initiatives, are discussed below.
FISCAL YEAR 2020 OPERATIONAL MILESTONES AND STRATEGIC INITIATIVES
The pre-established Company operational milestones and strategic initiatives for fiscal year 2020 were established in fiscal year 2019 prior to the onset of the novel coronavirus pandemic (“COVID-19”) and legal developments with POSCO Energy Co. Ltd. (“POSCO Energy”). As a result of these factors, the Compensation Committee re-visited the pre-established milestones and strategic initiatives to remove revenue and margin targets associated with expected sales to POSCO Energy and to make certain other adjustments related to the impacts of COVID-19, including (a) the manufacturing facility shutdown that occurred from March 18, 2020 to June 22, 2020, (b) the delay in certain bids and solicitations and the general impact to sales initiatives associated with lockdowns and travel bans, (c) the effect of the pandemic on customer capital budgets and spending, (d) the inability to affect policy due to the adjournment of state legislatures due to COVID-19, and (e) the inability to commercialize certain technologies due to the COVID-19 shutdowns.
The original operational milestones and their respective weighting as determined by the Compensation Committee at the time of their establishment in fiscal year 2019, prior to the onset of COVID-19 and legal developments with POSCO Energy were:
Fiscal Year 2020 Original Operational Milestones
Category
Target Achievement
Milestone
Weighting
125%
100%
75%
50%
Achieve FY Revenue Target
20% $ 107M $ 82M $ 75M $ 70M
Secure New Orders
25% 45MW 20MW 15MW 10MW
Achieve Gross Margin Targets
20% 18% 14% 12% 10%
Operating Expenses
20% $ 32.9M $ 34.4M $ 35.4M $ 36.4M
New Generation MW Fleet Performance Improved
15% 92% 91% 90% 88%
Fiscal Year 2020 Original Strategic Initiatives
Initiative
Weight
Strategic Partners/Investors/Business Plan
20%
Secure tax equity and permanent financing investment partners
Restructure company to support project financing
U.S. and State Policy Advancement
20%
Endeavor to ensure the Company is included in renewable standards/programs or the equivalent in targeted markets and in Federal
policy/procurements
Participate in no less than three policy formation activities in the Company’s target markets
Grow Advanced Technology Business
20%
Successful execution of Year One Objectives Under the Joint Development Agreement with ExxonMobil Research and Engineering Company
Develop and launch multi-year business plan for distributed hydrogen commercialization
Secure investor for distributed hydrogen commercialization
Execute on Department of Energy projects to develop hydrogen storage technology and electrolysis
Commercial Development
20%
Build on utility scale power purchase agreement (“PPA”) backlog
Develop microgrid opportunities
Close one project in Europe
Capitalize on 2019 behind the meter programs in Massachusetts and New Jersey
FUELCELL ENERGY, INC. | PROXY STATEMENT   31

 
Executive Compensation
Initiative
Weight
Close behind the fence opportunities in the U.S.
Develop multi-channel partners to distribute Company power platforms
Establish a customer satisfaction measurement process
Operations
20%
Achieve supply chain cost reductions
Deliver manufacturing lean targets
Deliver in-flight projects on time and on budget
The revised operational milestones and strategic initiatives and their respective weighting as determined by the Compensation Committee, and the Company’s forecasted achievement were:
Fiscal Year 2020 Revised Operational Milestones
Category
Target Achievement
Company
Forecasted(1)
Achievement
Percentage of
Target
Achievement
Milestone
Weighting
125%
100%
75%
50%
Achieve FY Revenue Target 20% $ 82M $ 57M $ 50M $ 45M $ 70.9M 115%
Secure New Orders 40% 41MW 31MW 16MW 6MW 11.2MW 65%
Achieve Gross Margin Targets 20% 5% 10% 5% -4% -6.0% 0%
Operating Expenses 10% $ 32.9M $ 34.4M $ 35.4M $ 36.4M $ 31.4M 125%
New Generation MW Fleet Performance Improved 10% 92% 91% 90% 88% 78% 0%
Aggregate
100% 62%
Fiscal Year 2020 Revised Strategic Initiatives
Initiative
Weight
Company
Forecasted(1)
Achievement
Percentage of Achievement
Strategic Partners/Investors/Business Plan
20%
Secure tax equity and permanent financing investment partners Y 100%
U.S. and State Policy Advancement
20%
Participate in no less than three policy formation activities in the Company’s target markets Y 100%
Grow Advanced Technology Business
20%
Successful execution of Year One Objectives Under the Joint Development Agreement with ExxonMobil Research and Engineering Company Y 100%
Execute on Department of Energy projects to develop hydrogen storage technology and
electrolysis
Y 100%
Commercial Development
20%
Build on utility scale PPA backlog
Y 100%
Close behind the fence opportunities in the U.S.
N 0%
Operations
20%
Deliver in-flight projects on time and on budget
Y 100%
Aggregate
100% 90%
(1)
Payouts were based on forecasted achievement based on information available at the time of performance achievement evaluation at the close of the fiscal year, prior to completion of the Company’s audited financials and release of the Annual Report on Form 10-K for the fiscal year ended October 31, 2020. Payouts were not adjusted based on the completed audited financials.
32   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
PERFORMANCE RESULTS AND ANNUAL INCENTIVE AWARD PAYMENTS FOR FISCAL YEAR 2020
At the end of fiscal year 2020, the Compensation Committee reviewed the Company’s performance as measured against the Company’s revised operational milestones and strategic initiatives, which resulted in an annual incentive award achievement percentage of 69% of the target award levels, determined as follows. Comparing the Company’s performance against the range of pre-established target levels for these revised operational milestones, the Compensation Committee calculated a weighted achievement percentage for each milestone, the sum of which yielded a total weighted achievement percentage. The Company’s overall performance with respect to the revised operational milestones for fiscal year 2020 resulted in a calculated aggregate weighted achievement percentage of 62%.
With respect to the fiscal year 2020 Company revised strategic initiatives, the Compensation Committee compared the Company’s performance against the pre-established target objectives for these initiatives, and calculated a weighted achievement percentage for each strategic initiative, the sum of which yielded a total weighted achievement percentage. Our overall performance with respect to the revised strategic initiatives for fiscal year 2020 resulted in a calculated weighted achievement percentage of 90%.
Applying the relative weighting of each performance category (75% for the operational milestones and 25% for the strategic initiatives), the Compensation Committee determined that the blended annual incentive award achievement percentage was equal to 69% of the target award levels.
In determining the annual incentive award payments to be made for fiscal year 2020, the Compensation Committee also considered the progress made by the Company over the fiscal year in executing on its business plan despite the COVID-19 pandemic and determined to adjust the annual incentive award payment percentage for fiscal year 2020 to 70%.
After reviewing the blended annual incentive award achievement percentage, evaluating the Company’s performance, financial position, stock performance, and response to the unanticipated and significant challenges posed by the COVID-19 pandemic, and considering the recommendations of the CEO (with respect to the executive officers other than himself), the Compensation Committee determined to adjust the annual incentive award payment percentages for fiscal year 2020 for certain members of senior management in the Company, including Mr. Bishop, Ms. Arasimowicz, Mr. Lisowski and Mr. Leo to 100% of targeted awards, with the specific cash amounts paid to each NEO as set forth in the Fiscal Year 2020 Summary Compensation Table on page 36 of this Proxy Statement. The Compensation Committee also recommended, and the independent members of the Board agreed, that an annual incentive award payment be made to Jason Few in the amount of 100% of his target bonus award with the specific cash amount paid as set forth in the Fiscal Year 2020 Summary Compensation Table on page 36 of this Proxy Statement.
The determination to adjust the annual incentive awards for the executive officers was based on (a) the high level of achievement of the operational milestones and strategic initiatives despite the challenges of the coronavirus pandemic and the manufacturing facility shutdown and reopening, (b) successful capital raises during fiscal year 2020 totaling gross proceeds of approximately $175 million to fund the Company’s business plan, (c) arrangements to fund legal fees and costs associated with the POSCO Energy arbitration and the termination of the POSCO Energy license agreements, (d) substantial shareholder outreach and restructuring of the long-term incentive plan to a performance-based plan in response to prior years’ say-on-pay votes, (e) successful management of the COVID-19 pandemic, including the shut down and restart of manufacturing operations, retention of employees with full pay and benefits, deferral of compensation by the NEOs and the continuation of essential services and plant construction, and (f) the substantial increase in the Company’s stock price. Based on all of the foregoing, the Compensation Committee and the Board determined that adjustment of the annual incentive award percentages was warranted.
FISCAL YEAR 2021 OPERATIONAL MILESTONES AND OPERATIONAL INITIATIVES UNDER THE MIP
For fiscal year 2021, the pre-established Company operational milestones and operational initiatives have been updated to further advance our business objectives. The operational milestones for fiscal year 2021 are consistent with our fiscal year 2021 annual operating plan and were set in consideration of the Company’s prior performance and fiscal year 2021 budget. The operational milestones (and their respective weighting) are: (1) achieve a specified level of total revenue for the fiscal year (33.3%), (2) secure new orders (33.3%), and (3) achieve a specified adjusted EBITDA (33.4%).
The Compensation Committee has also established operational initiatives for fiscal year 2021 applicable to all participants including the NEOs. The pre-established Company operational initiatives for fiscal year 2021 (which are equally weighted) are as follows: (a) implement an operating performance model based on objectives and key results, known as “OKRs”; (b) expand project financing, tax equity, and permanent financing partners; (c) implement ESG best practices/operational measurement system; (d) implement key plant performance improvements identified by breakthrough teams; and (e) implement and execute on a hydrogen product / commercialization / financing roadmap.
Consistent with past practice, the overall operational milestone achievement will be weighted 75% and the overall operational initiative achievement will be weighted 25%.
LONG TERM INCENTIVE COMPENSATION
We use long-term incentive compensation, in the form of equity awards, to motivate and reward executive officers for effectively executing longer-term strategic and operational objectives. The value of these equity awards is based on the value of our common stock, and these awards help align the interests of our executive officers with those of the Company’s stockholders.
FUELCELL ENERGY, INC. | PROXY STATEMENT   33

 
Executive Compensation
Subsequent to the end of fiscal year 2019, in response to stockholder concerns as expressed in prior say-on-pay votes, the Compensation Committee retained Meridian to evaluate our long-term incentive compensation for fiscal year 2020 as part of our efforts to better align our long-term incentive compensation program with the interests of our stockholders and market practices. With the help of Meridian, the Compensation Committee established a new long-term incentive plan comprised of performance stock units (“PSUs”) and time-based restricted stock units (“RSUs”). The Compensation Committee elected to use PSUs as the primary equity vehicle for the executive officers because these awards reflect a balance between significant upside potential for superior stock price performance, and decline in award size, to zero in the extreme, for performance that is below expectations.
The Compensation Committee exercises its judgment in determining the size of the equity awards granted to executive officers. For each eligible executive, the Committee considers the relative value of equity awards compared to the equity awards held by other executive officers, the desired incentive mix between PSU awards and RSU awards, a compensation analysis performed by Meridian, and the individual experience, skills and performance level of the executive officer.
For fiscal year 2020, the Compensation Committee determined to allocate 80% of long-term incentive awards to PSUs based on total stockholder return (“TSR”), with 40% being based on absolute TSR and 40% being based on relative TSR, as further described below. The remaining 20% of the long-term incentive award is allocated to RSUs that vest ratably over a 3 year period from the date of grant, with a grant date fair value of the average closing stock price over the 20 trading days immediately preceding the date of the grant.
For the PSUs granted for fiscal year 2020, the Compensation Committee established the performance period as May 8, 2020 (the date of the reconvened 2020 Annual Meeting at which our stockholders approved an increase in the number of shares authorized to be issued under our 2018 Omnibus Incentive Plan and the amendment and restatement of our 2018 Omnibus Incentive Plan) through October 31, 2022.
The Compensation Committee established the performance assessment criteria for the relative TSR PSUs as the TSR of the Company relative to the TSR of the Russell 2000, with the payout calibration being 100% plus or minus 0.5x the difference between the Company’s TSR and the Russell 2000 Index composite TSR. Payout is capped at 200% of the target number of PSUs, and payout is further capped at 100% of the target number of PSUs if the Company’s absolute TSR over the performance period is negative. The Company’s TSR is calculated by subtracting the Company’s beginning stock price (defined as the average closing price of the Company’s common stock over the 20 consecutive trading days ending on the last trading day immediately prior to May 8, 2020) from the ending stock price (defined as the average closing price of the Company’s common stock over the 20 consecutive trading days ending on October 31, 2022), adding any dividends during the period, and then dividing the result by the Company’s beginning stock price. PSUs earned on the basis of relative TSR performance remain subject to vesting based on continued service until August 24, 2023 (the third anniversary of the grant date).
The Compensation Committee established the performance assessment criteria for the absolute TSR PSUs as the Company’s closing stock price, with the payout calibration being based on a specified percentage increase in the price of the Company’s common stock over the average closing price of the Company’s common stock over the 20 consecutive trading days ending on the last trading day immediately prior to May 8, 2020, which was $1.8765. Specifically, a 50% increase earns 50% of the target award, a 100% increase earns 100% of the target award and a 150% increase earns 200% of the target award. Each price hurdle must be met for 20 consecutive trading days, and price hurdles may be met at any time during the performance period. PSUs earned on the basis of absolute TSR performance remain subject to vesting based on continued service until August 24, 2023 (the third anniversary of the grant date).
See the Fiscal Year 2020 Grants of Plan-Based Awards Table on page 37 for actual grants made to executive officers for fiscal year 2020.
COMPENSATION POLICIES
PROHIBITION ON OPTION RE-PRICING AND BACKDATING
The Compensation Committee does not re-price and has not re-priced options to purchase shares of our common stock, consistent with the 2018 Omnibus Incentive Plan, as amended and restated, which prohibits re-pricing of equity awards without stockholder approval. The grant date for each equity award is based on the date the award is approved by the Compensation Committee or the independent members of our Board, as applicable. Options to purchase shares of our common stock are granted with an exercise price equal to the closing market price of our common stock on the date of grant.
EQUITY AWARD GRANT POLICY
We maintain an Equity Award Grant Policy, which was most recently amended in December 2018. This policy includes the following key provisions: (a) all equity awards of more than 40,000 shares must be submitted to the Compensation Committee for approval; (b) all equity awards granted to executives at the level of vice president (or above) must be submitted to the Compensation Committee for approval; and (c) the Compensation Committee has authorized a pool of up to 100,000 shares from which the CEO may approve equity awards for special recognition or retention purposes, provided that such grants are limited to a grant date fair value of $40,000 or less, and further provided that no grants may be made from this pool to employees at the level of vice president or above.
34   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
COMPENSATION RECOVERY POLICY
We maintain an Executive Compensation Recovery Policy. A description of this policy can be found on page 15 of this Proxy Statement under “Corporate Governance.”
ANTI-HEDGING POLICY
A description of our anti-hedging policy can be found on page 15 of this Proxy Statement under “Corporate Governance.”
STOCK OWNERSHIP GUIDELINES
We maintain minimum stock ownership guidelines which were updated in December 2018, and, after being adjusted for the one-for-twelve reverse stock split effected by the Company in May 2019, amended again in February 2020. A description of these guidelines can be found on pages 15 and 16 of this Proxy Statement under “Corporate Governance.” As of October 31, 2020 and also as of the filing of this proxy statement, all directors and NEOs meet the stock ownership requirements.
TAX AND ACCOUNTING CONSIDERATIONS
Section 162(m) of the Internal Revenue Code, as amended by the Tax Cuts and Jobs Act of 2017, generally limits to $1.0 million the amount of remuneration that the Company may deduct in any calendar year for certain executive officers. While the Committee will continue to consider the deductibility of compensation as a factor in making compensation decisions, it retains the flexibility to provide compensation that is consistent with the Company’s goals for its executive compensation program, even if such compensation would not be fully tax-deductible.
We follow Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 for all stock-based awards. ASC Topic 718 requires companies to measure the compensation expense for all share-based payment awards made to employees and directors, including stock options and full value stock awards, based on the aggregate grant date “fair value” of these awards. This calculation is performed for accounting purposes and reported in the compensation tables on pages 36, 37 and 46 of this Proxy Statement. ASC Topic 718 also requires companies to recognize the compensation cost of their stock-based compensation awards in their income statements over the period that an executive officer is required to render service in exchange for the option or other award.
COMPENSATION RISK ASSESSMENT
Our Compensation Committee has reviewed our incentive compensation programs, discussed the concept of risk as it relates to our compensation program, considered various mitigating factors and reviewed these items with its independent compensation consultant, Meridian. In addition, our Compensation Committee asked Meridian to conduct an independent risk assessment of our executive compensation program. Based on these reviews and discussions, the Compensation Committee does not believe our compensation program creates risks that are reasonably likely to have a material adverse effect on our business.
FUELCELL ENERGY, INC. | PROXY STATEMENT   35

 
Executive Compensation
FISCAL YEAR 2020 SUMMARY COMPENSATION TABLE
The following table presents summary information regarding the total compensation awarded to, earned by or paid to the NEOs for the fiscal years ended October 31, 2020, 2019, and 2018 (except for Messrs. Few, Lisowski and Leo for whom information is provided only with respect to the fiscal years ended October 31, 2020 and 2019 as they were not NEOs prior to fiscal year 2019).
Name and Principal Position
Year
Salary
($)
Bonus
($)(1)
Stock
Awards
($)(2)
Non-Equity
Incentive Plan
Compensation
($)(3)
All Other
Compensation
($)
Total
($)
Jason Few
President, Chief Executive Officer and Chief Commercial Officer
2020
475,000 2,688,193 427,500 204,832(4) 3,795,525
2019
91,346 500,000 165,000 68,475 58,348 883,169
Michael S. Bishop
Executive Vice President,
Chief Financial Officer and Treasurer
2020
385,000 416,596 192,500 4,875 998,971
2019
368,173 50,000 146,250 4,750 569,173
2018
333,402 478,000 10,076 821,478
Jennifer D. Arasimowicz
Executive Vice President General Counsel, Chief Administrative Officer and Corporate Secretary
2020
365,000 391,596 182,500 4,285 943,381
2019
347,404 50,000 141,250 4,179 542,833
2018
309,231 478,000 7,433 794,664
Michael J. Lisowski
Executive Vice President and Chief
Operating Officer
2020
325,000 366,602 162,500 3,250 857,352
2019
264,693 30,000 126,250 2,622 423,565
Anthony J. Leo
Executive Vice President and Chief
Technology Officer
2020
275,000 183,300 137,500 3,437 599,237
2019
262,154 30,000 108,750 3,277 404,181
(1)
The amounts reported in the “Bonus” column represent, for Mr. Few, for fiscal year 2019, the one-time signing bonus pursuant to his employment agreement, which was paid 50% during fiscal year 2019 and 50% during fiscal year 2020, and for Messrs. Bishop, Lisowski and Leo and Ms. Arasimowicz, for fiscal year 2019, the payments made pursuant to the cash incentive plan adopted by the Board on July 15, 2019 to retain certain key executives, of which the first two payments (totaling $27,778 for each of Mr. Bishop and Ms. Arasimowicz and $16,667 for each of Messrs. Lisowski and Leo) were paid in fiscal year 2019 and the second two payments (totaling $22,222 for each of Mr. Bishop and Ms. Arasimowicz and $13,333 for each of Messrs. Lisowski and Leo) were paid in fiscal year 2020.
(2)
The amounts reported in the “Stock Awards” column reflect the aggregate grant date fair value of stock awards granted during each of the fiscal years 2020, 2019, and 2018, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation (“ASC Topic 718”). These values have been determined under the principles used to calculate the grant date fair value of equity awards for purposes of our financial statements. For a discussion of the assumptions and methodologies used to value the awards reported in this column, please see the discussion of stock awards contained in Note 18 of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended October 31, 2020. The maximum values of the fiscal year 2020 PSU awards at the grant date assuming that the highest level of performance conditions are attained, are as follows: Mr. Few — $674,028; Mr. Bishop — $337,014; Ms. Arasimowicz — $316,792; Mr. Lisowski — $296,570; and Mr. Leo — $148,284.
(3)
The amounts reported in the “Non-Equity Incentive Plan Compensation” column represent the value of the annual incentive award payment earned by each NEO for fiscal years 2020, 2019, and 2018 under our Management Incentive Plan. The amounts reported for fiscal years 2020, 2019, and 2018 were paid in cash and the amounts reported for fiscal year 2020 were paid in fiscal year 2021.
(4)
The amount reported under “All Other Compensation” for Mr. Few for fiscal year 2020 includes $38,440 in apartment rental expenses, $143,000 in commuting expenses, $8,442 in tax preparation fee reimbursement and $10,200 in membership fee reimbursement. The amount reported for fiscal year 2019 includes $4,740 in apartment rental expense, $28,517 in commuting expenses, and $25,000 in reimbursement of legal fees to Mr. Few for negotiation of his employment agreement with the Company.
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Executive Compensation
 
FISCAL YEAR 2020 GRANTS OF PLAN-BASED AWARDS
The following table sets forth certain information with respect to the annual incentive and stock-based awards granted to our named executive officers in fiscal year 2020 under the 2018 Omnibus Incentive Plan, as amended and restated. The material terms of these awards are described above in the sections titled “Annual Incentive Compensation” and “Long Term Incentive Compensation” on pages 30 and 33 of this Proxy Statement, respectively.
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards
Estimated Future Payouts
Under Equity Incentive
Plan Awards
All Other
Stock
Awards;
Number of
Shares of
Stock or
Units
Grant
Date Fair
Value of
Stock
Awards($)(1)
Name
Award Type
Grant Date
Threshold ($)
Target ($)
Maximum($)
Threshold
Number
of
Shares
Target
Number
of
Shares
Maximum
Number
of Shares
Jason Few
Relative TSR PSUs
08/24/2020
37,446 74,892 149,784 200,000
Absolute TSR PSUs
08/24/2020
37,446 74,892 149,784 200,000
Time-Based RSUs
08/24/2020
37,446 100,000
MIP
N/A 427,500 427,500
Michael S.
Bishop
Relative TSR PSUs
08/24/2020
18,723 37,446 74,892 100,000
Absolute TSR PSUs
08/24/2020
18,723 37,446 74,892 100,000
Time-Based RSUs
08/24/2020
18,723 50,000
MIP
N/A 192,500 192,500
Jennifer D.
Arasimowicz
Relative TSR PSUs
08/24/2020
17,600 35,199 70,398 94,000
Absolute TSR PSUs
08/24/2020
17,600 35,199 70,398 94,000
Time-Based RSUs
08/24/2020
17,600 47,000
MIP
N/A 182,500 182,500
Michael J.
Lisowski
Relative TSR PSUs
08/24/2020
16,296 32,952 65,184 87,999
Absolute TSR PSUs
08/24/2020
16,296 32,952 65,184 87,999
Time-Based RSUs
08/24/2020
16,477 44,002
MIP
N/A 162,500 162,500
Anthony J. Leo
Relative TSR PSUs
08/24/2020
8,238 16,476 32,952 44,000
Absolute TSR PSUs
08/24/2020
8,238 16,476 32,952 44,000
Time-Based RSUs
08/24/2020
8,238 22,000
MIP
N/A 137,500 137,500
(1)
Amounts reported in this column are based on the grant date fair value of awards computed in accordance with FASB ASC Topic 718.
FUELCELL ENERGY, INC. | PROXY STATEMENT   37

 
Executive Compensation
OUTSTANDING EQUITY AWARDS AT 2020 FISCAL YEAR-END TABLE
The following table presents, for each of the NEOs, information with respect to the outstanding equity awards held at October 31, 2020. All grant amounts have been adjusted to reflect the one-for-twelve reverse stock split effected by the Company in May 2019.
Stock Awards
Name
Stock
Award
Grant
Date
Number of
Shares
or Units of
Stock
That Have
Not Vested (#)(1)
Market Value
of Shares or
Units of Stock
That Have Not
Vested ($)(2)
Equity Incentive
Plan Awards;
Number of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested (#)(4)
Equity
Incentive Plan
Awards; Market
or Payout
Value of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested ($)(2)
Jason Few(3)
06/03/2020 500,000 1,000,000
06/03/2020 500,000 1,000,000
08/24/2020 37,446 74,892
08/24/2020 74,892 149,784
08/24/2020 74,892 149,784
Michael S. Bishop
04/05/2018 4,682 9,364
04/05/2018 8,333 16,666
08/24/2020 18,723 37,446
08/24/2020 37,446 74,892
08/24/2020 37,446 74,892
Jennifer D. Arasimowicz
04/06/2017 4,167 8,334
04/05/2018 4,682 9,364
04/05/2018 8,333 16,666
08/24/2020 17,599 35,198
08/24/2020 35,199 70,398
08/24/2020 35,199 70,398
Michael J. Lisowski
01/31/2018 2,496 4,992
08/24/2020 16,477 32,954
08/24/2020 32,952 65,904
08/24/2020 32,952 65,904
Anthony J. Leo
04/05/2018 1,701 3,402
08/24/2020 8,238 16,476
08/24/2020 16,476 32,952
08/24/2020 16,476 32,952
(1)
The restricted stock unit award granted to Mr. Few on June 3, 2020 will vest on August 26, 2022. The restricted stock unit awards granted to all NEOs on August 24, 2020 vest ratably over 3 years from the grant date. The restricted stock unit awards granted to Ms. Arasimowicz in 2017 vest at a rate of 25% per year beginning on the first anniversary of the date of the grant. The restricted stock unit awards granted to Mr. Bishop and Ms. Arasimowicz in 2018 vest 100% on the third anniversary of the grant date.
(2)
The fair market value of unvested restricted stock, restricted stock unit and performance stock unit awards is based on the per share closing price of our common stock on October 30, 2020, which was $2.00.
(3)
The performance-vesting restricted stock units granted on June 3, 2020 to Mr. Few were granted in connection with Mr. Few’s August 26, 2019 employment agreement, and they are eligible to be earned on the third anniversary of Mr. Few’s employment agreement based on stock price performance.
(4)
The performance stock units granted to all NEOs on August 24, 2020 are eligible to be earned over a three-year performance period based on absolute or relative TSR. The performance stock units are shown in the table above at the target level, which is the next level above the level of performance through the end of fiscal year 2020. Performance stock units granted on June 3, 2020 to Mr. Few were granted in connection with Mr. Few’s August 26, 2019 employment agreement, and they are eligible to be earned on the third anniversary of Mr. Few’s employment agreement based on stock price performance.
38   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
FISCAL YEAR 2020 OPTION EXERCISES AND STOCK VESTED TABLE
The following table presents, for each of the NEOs, the number of shares of our common stock acquired upon the vesting of restricted stock awards and restricted stock units during fiscal year 2020, and the aggregate value realized upon the vesting of such awards. Our NEOs did not exercise any options to purchase shares of our common stock during fiscal year 2020. For purposes of this table, the value realized is based upon the fair market value of our common stock on each vesting date. The number of shares included in the following table has been adjusted to reflect the one-for-twelve reverse stock split effected by the Company in May 2019.
Stock Awards(1)
Name
Number of
Shares Acquired
on Vesting (#)
Value Realized
on Vesting ($)(2)
Jason Few
5,629(3) 8,444
Michael S. Bishop
10,675(4) 15,311
Jennifer D. Arasimowicz
9,044(5) 12,941
Michael J. Lisowski
2,319(6) 3,524
Anthony J. Leo
4,429(7) 6,351
(1)
Represents the gross number of shares acquired and value received on the vesting of restricted stock and restricted stock unit awards, without reduction for the number of shares withheld to pay applicable withholding taxes. Shares and value net of withholding are discussed in the following footnotes.
(2)
The amount reported in the “Value Realized on Vesting” column is computed by multiplying the number of shares of our common stock that vested by the closing market price of our common stock on the applicable vesting date.
(3)
Represents the vesting of 100% of Mr. Few’s April 4, 2019 award of 5,629 restricted stock units, in accordance with the terms of the award.
(4)
Represents the vesting of the second tranche (33%) of Mr. Bishop’s April 5, 2018 award of 14,044 restricted stock units; the vesting of the third tranche (33%) of his April 6, 2017 award of 14,583 restricted stock units; and the vesting of the fourth tranche (25%) of his April 7, 2016 award of 4,529 shares of restricted stock, in each case in accordance with the terms of the applicable award.
(5)
Represents the vesting of the second tranche (33%) of Ms. Arasimowicz’s April 5, 2018 award of 14,044 restricted stock units; the vesting of the third tranche (25%) of her April 6, 2017 award of 16,666 restricted stock units; and the vesting of the fourth tranche (25%) of her April 7, 2016 award of 789 shares of restricted stock, in each case in accordance with the terms of the applicable award.
(6)
Represents the vesting of the second tranche (33%) of Mr. Lisowski’s January 31, 2018 award of 4,990 restricted stock units, the third tranche (33%) of his April 6, 2017 award of 2,625 shares of restricted stock, and the fourth tranche (25%) of his April 7, 2016 award of 789 shares of restricted stock, in each case in accordance with the terms of the applicable award.
(7)
Represents the vesting of the second tranche (33%) of Mr. Leo’s April 5, 2018 award of 5,103 restricted stock units, the third tranche (33%) of his April 6, 2017 award of 6,875 shares of restricted stock, and the fourth tranche (25%) of his April 7, 2016 award of 1,746 shares of restricted stock, in each case in accordance with the terms of the applicable award.
EMPLOYMENT AGREEMENTS AND CHANGE OF CONTROL AND SEVERANCE
Each of the NEOs has an employment agreement with the Company, under which such NEO is eligible to receive certain severance payments and benefits in connection with a termination of employment under various circumstances, including following a change of control of the Company.
In reporting the estimated potential payments and benefits payable to each NEO in the event of termination of employment as of October 31, 2020, we assumed that the terms of such NEOs’ employment agreements were applicable. The actual amounts that would be paid or distributed to the NEOs as a result of one of the termination events occurring in the future may be different than those presented below as many factors will affect the amount of any payments and benefits upon a termination of employment. For example, some of the factors that could affect the amounts payable include the NEO’s base salary and the market price of our common stock at the time of termination. In addition, although we have entered into written arrangements to provide severance payments and benefits to the NEOs in connection with a termination of employment under particular circumstances, we may mutually agree with the NEOs on severance terms that vary from those provided in these pre-existing agreements. Finally, in addition to the amounts presented below, each NEO would also be able to exercise any previously-vested options to purchase shares of our common stock that s/he held (if applicable). For more information about the NEOs’ outstanding equity awards as of October 31, 2020, see the Outstanding Equity Awards at 2020 Fiscal Year-End Table above.
In addition to the severance payments and benefits described in each NEO’s individual employment agreement, the NEOs are eligible to receive any benefits accrued under our broad-based benefit plans, such as accrued vacation pay, in accordance with those plans.
MR. FEW
Effective as of August 26, 2019, we entered into an employment agreement with Mr. Few in connection with his appointment as the President and Chief Executive Officer of the Company (the “CEO Employment Agreement”). The CEO Employment Agreement specifies the reasons pursuant to which his employment may be terminated by our Board and provides him with certain compensation and benefits upon termination of employment (including in connection with a change in control of the Company). We believe that these provisions help ensure the Company’s long-term success. The CEO Employment Agreement also sets forth the terms and conditions of employment for
FUELCELL ENERGY, INC. | PROXY STATEMENT   39

 
Executive Compensation
Mr. Few including his initial base salary, which is to be reviewed at least annually by our Board, and target annual incentive award opportunity. Mr. Few is also eligible to participate in the insurance plans and other employee benefits generally available to our other employees. The CEO Employment Agreement contains non-disclosure provisions that apply indefinitely and prohibit Mr. Few from competing with the Company and from soliciting our employees, in each case, during the term of his employment and for a period of two years thereafter.
In the event Mr. Few’s employment is terminated by the Company without cause or he resigns for good reason (as defined in the CEO Employment Agreement), subject to his execution of a general release of claims against the Company, he is eligible to receive a severance payment in an amount equal to (i) his then-current annual base salary as of the date of termination plus (ii) his target bonus for the year of termination plus (iii) a pro-rata portion of the annual bonus amount that would have been paid but for the termination, pro-rated based on the number of days in such fiscal year that Mr. Few was actually employed by the Company plus (iv) reasonable relocation expenses back to Houston, Texas (or such other city in Mr. Few’s discretion, provided that the expense shall not exceed the expense of relocating to Houston, Texas) in an amount not to exceed $200,000, as well as accelerated vesting of all outstanding equity awards and payment for continued health insurance for 12 months. In the event of termination of Mr. Few’s employment by the Company for any other reason (including death or disability), we will only pay Mr. Few any base salary and vacation accrued but as yet unpaid on the effective date of such termination, any earned but unpaid annual bonus with respect to any completed fiscal year immediately preceding the effective date of termination, and reimbursement for unreimbursed business expenses properly incurred. In the event that the termination of Mr. Few’s employment is within the 3 months prior to or the 18 months following a change in control of the Company, Mr. Few is eligible to receive a severance payment in an amount equal to (i) 2 times the sum of his then-current annual base salary plus his target bonus for the year of termination plus (ii) a pro-rata portion of the annual bonus amount that would have been paid but for the termination, pro-rated based on the number of days in such fiscal year that Mr. Few was actually employed by the Company plus (iii) reasonable relocation expenses to Houston, Texas (or such other city in Mr. Few’s discretion, provided that the expense shall not exceed the expense of relocating to Houston, Texas) in an amount not to exceed $200,000, as well as accelerated vesting of all outstanding equity awards and payment for continued health insurance for 24 months.
The CEO Employment Agreement further provides that, if Mr. Few receives any payments in connection with a change of control of the Company that would constitute excess parachute payments that are subject to excise taxes under Section 4999 of the Code, then the total severance payment shall be delivered either (a) in full or (b) in an amount such that the value of the aggregate total payments are $1.00 less than the maximum amount Mr. Few may receive without being subject to the tax, whichever results in Mr. Few receiving the greatest after-tax benefit.
The following table sets forth the potential (estimated) payments and benefits that Mr. Few would be eligible to receive upon termination of employment (including in connection with a change in control of the Company), as specified under the CEO Employment Agreement, assuming that the triggering event described below occurred on October 31, 2020.
POTENTIAL PAYMENTS AND BENEFITS UPON A TERMINATION OF EMPLOYMENT OR A CHANGE IN CONTROL OF THE COMPANY FOR MR. FEW
Executive Payments and Benefits(1)
Termination without
Cause or Resignation
for Good Reason
($)(2)
Death or
Disability
($)(2)
Following Change
in Control of
the Company
($)(2)
Accelerated vesting:
Stock options(3)
Restricted Shares/Stock Units(3)(4)
1,374,460 2,674,028
Payment for annual incentive award 855,000 855,000
Continued Health Insurance Premiums(5) 34,288 68,575
Severance payment 675,000 1,150,000
TOTAL
2,938,748
4,747,603
(1)
For purposes of this analysis, we have assumed that Mr. Few’s base salary is equal to $475,000, Mr. Few’s target annual bonus is $427,500, the total amount of the annual bonus for fiscal year 2020 (in an amount of $427,500) would have been earned, Mr. Few would have received relocation expenses of $200,000, Mr. Few’s Long Term Incentive Award for fiscal year 2020 would have been earned at target as reflected in the Fiscal Year 2020 Grants of Plan-Based Awards table on page 37 of this Proxy Statement and Mr. Few had outstanding restricted stock and stock unit awards as reflected in the Outstanding Equity Awards at 2020 Fiscal Year-End Table, on page 38 of this Proxy Statement. These amounts reflect the terms of his compensation arrangements as approved by the independent members of our Board, effective August 26, 2019.
(2)
Assumes Mr. Few’s date of termination of employment was October 31, 2020. The market price of our common stock on October 30, 2020 was $2.00 per share. In addition, we have assumed that the total payments and benefits to Mr. Few in connection with a change in control of the Company would not trigger any excise taxes under Section 4999 of the Code.
(3)
The CEO Employment Agreement provides for accelerated vesting of Mr. Few’s outstanding and unvested restricted stock and restricted stock unit awards and deems all performance unit awards as earned at target upon a change in control of the Company. Assuming a change in control occurred on October 31, 2020, Mr. Few would receive accelerated vesting of 1,187,230 restricted stock units and 149,784 performance stock units. As of October 31, 2020, Mr. Few had no options to purchase shares of our common stock outstanding.
40   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
(4)
The value of the restricted stock unit awards and performance stock units on October 30, 2020 is based on 1,187,230 restricted stock units and 149,784 performance stock units at $2.00 per share that had not vested.
(5)
Mr. Few is eligible to receive payment of continued health insurance for a period of 12 months upon termination of employment without cause or resignation for good reason and 24 months if termination of employment without cause or resignation for good reason occurs in connection with a change in control of the Company. The value of continued health insurance is based on the medical and dental insurance rates in effect for all employees of the Company as of October 31, 2020.
MR. BISHOP, MS. ARASIMOWICZ, MR. LISOWSKI AND MR. LEO
We entered into employment agreements (the “Other NEO Agreements”) with Mr. Bishop (effective January 1, 2012), with Ms. Arasimowicz (effective April 6, 2017), and with Mr. Lisowski and Mr. Leo (each effective August 1, 2019) which specify the reasons pursuant to which their employment may be terminated and provide them with certain compensation and benefits upon termination of employment (including in connection with a change in control of the Company). We believe that these provisions help ensure the Company’s long-term success. The Other NEO Agreements set forth the terms and conditions of their employment including the initial annual base salary and target annual incentive award opportunity, which is equal to 50% of base salary and payable in accordance with the terms of the Management Incentive Plan described on page 30 of this Proxy Statement. Our NEOs are also eligible to participate in insurance plans and other employee benefits generally available to our other employees.
In the event that the employment of Ms. Arasimowicz or Messrs. Bishop, Lisowski or Leo is terminated by the Company without cause, or any of them resigns for “good reason” ​(as defined in his/her applicable agreement), he/she is eligible to receive a severance payment in an amount equal to six months of his/her then-current annual base salary as of the date of termination, as well as payment for continued health insurance for six months. In the event that Mr. Bishop, Ms. Arasimowicz, Mr. Lisowski or Mr. Leo is terminated by the Company without cause or resigns for good reason in connection with a change in control of the Company, his/her outstanding and unvested options to purchase shares of our common stock and restricted stock and restricted stock unit awards accelerate and immediately vest. In addition, each of them is eligible to receive a severance payment in an amount equal to one year of his/her base salary as of the date of termination plus the average of the bonuses paid to him/her since his/her appointment as an executive officer of the Company as well as payment for continued health insurance for 12 months. In the event of termination of employment by the Company for any other reason (including death or disability), we will only be required to pay him/her any base salary and vacation accrued but unpaid as of the effective date of such termination.
The following tables set forth the potential (estimated) payments and benefits which Ms. Arasimowicz and Messrs. Bishop, Lisowski and Leo would be eligible to receive upon termination of employment (including in connection with a change in control of the Company), as specified under the applicable Other NEO Agreements, assuming that the triggering event described below occurred on October 31, 2020.
POTENTIAL PAYMENTS AND BENEFITS UPON A TERMINATION OF EMPLOYMENT OR A CHANGE IN CONTROL OF THE COMPANY FOR MR. BISHOP
Executive Payments and Benefits(1)
Termination without
Cause or Resignation
for Good Reason
($)(2)
Death or
Disability
($)(2)
Following Change
in Control of
the Company
($)(2)
Accelerated vesting:
Stock options(3)
Restricted Shares/Stock Units(3)(4)
263,188
Payment for annual incentive award 89,756
Continued Health Insurance Premiums(5) 12,146 24,292
Severance payment(6) 192,500 385,000
TOTAL
204,646
762,236
(1)
For purposes of this analysis, we have assumed that Mr. Bishop’s compensation is as follows: a base salary equal to $385,000 and annual incentive award payments paid for fiscal year 2011 in the amount of $59,850, for fiscal year 2012 in the amount of $79,835, for fiscal year 2013 in the amount of $89,670, for fiscal year 2014 in the amount of $94,500, for fiscal year 2015 in the amount of $83,430, for fiscal year 2016 in the amount of $78,750, for fiscal year 2017 in the amount of $125,520, for fiscal year 2018 in the amount of $0, and for fiscal year 2019 in the amount of $196,250 and that Mr. Bishop had outstanding restricted stock and restricted stock unit awards as reflected in the Outstanding Equity Awards at 2020 Fiscal Year-End Table on page 38 of this Proxy Statement and target performance stock unit awards as reflected in the Fiscal Year 2020 Grants of Plan-Based Awards table on page 37 of this Proxy Statement. These amounts reflect the terms of his compensation arrangements as approved by the Compensation Committee, effective January 1, 2012.
(2)
Assumes Mr. Bishop’s date of termination of employment was October 31, 2020. The market price of our common stock on October 30, 2020 was $2.00 per share.
(3)
Assuming termination of employment without cause or resignation for good reason in connection with a change in control of the Company, Mr. Bishop is to receive accelerated vesting of his outstanding and unvested restricted stock and restricted stock unit awards and it is deemed that the target performance goals of Mr. Bishop’s performance stock units had been met at the time of a change in control and that such performance stock units were prorated based on the elapsed portion of the performance period. As of October 31, 2020, Mr. Bishop held 106,630 unvested restricted stock units and 74,892 performance stock units, which for purposes of this table were prorated based on the elapsed portion of the performance period, which as of October 31, 2020 was one year. As of October 31, 2020, Mr. Bishop held no options to purchase shares of our common stock outstanding.
(4)
The value of the restricted stock unit awards and the prorated performance stock units on October 31, 2020 is based on 106,630 restricted stock units and 24,964 performance stock units at $2.00 per share.
FUELCELL ENERGY, INC. | PROXY STATEMENT   41

 
Executive Compensation
(5)
Mr. Bishop is eligible to receive payment of continued health insurance for a period of six months in the event his employment is terminated without cause or he resigns for good reason and 12 months if his employment is terminated without cause or he resigns for good reason in connection with a change in control of the Company. The value of continued health insurance is based on the medical and dental insurance rates in effect for all employees of the Company as of October 31, 2020.
(6)
In the event Mr. Bishop’s employment is terminated without cause or he resigns for good reason, he is eligible to receive a severance payment equal to six months of his base salary. In the event his employment is terminated without cause or he resigns for good reason in connection with a change in control of the Company, he is eligible for 12 months of his base salary plus a bonus payment for the severance period equal to the average of the bonuses awarded to him since his appointment as our Chief Financial Officer.
POTENTIAL PAYMENTS AND BENEFITS UPON A TERMINATION OF EMPLOYMENT OR A CHANGE IN CONTROL OF THE COMPANY FOR MS. ARASIMOWICZ
Executive Payments and Benefits(1)
Termination without
Cause or Resignation
for Good Reason
($)(2)
Death or
Disability
($)(2)
Following Change
in Control of
the Company
($)(2)
Accelerated vesting:
Stock options(3)
Restricted Shares/Stock Units(3)(4)
257,250
Payment for annual incentive award 102,250
Continued Health Insurance Premiums(5) 17,144 34,287
Severance payment(6) 182,500 365,000
TOTAL
199,644
758,787
(1)
For purposes of this analysis, we have assumed that Ms. Arasimowicz’s compensation is as follows: a base salary equal to $365,000 and annual incentive award payments paid for fiscal year 2017 in the amount of $115,500, for fiscal year 2018 in the amount of $0 and for fiscal year 2019 in the amount of $191,250 and that Ms. Arasimowicz had outstanding restricted stock and restricted stock unit awards as reflected in the Outstanding Equity Awards at 2020 Fiscal Year-End Table on page 38 of this Proxy Statement and target performance stock unit awards as reflected in the Fiscal Year 2020 Grants of Plan-Based Awards table on page 37 of this Proxy Statement. These amounts reflect the terms of her compensation arrangements as approved by the Compensation Committee, effective April 6, 2017.
(2)
Assumes Ms. Arasimowicz’s date of termination of employment was October 31, 2020. The market price of our common stock on October 30, 2020 was $2.00 per share.
(3)
Assuming termination of employment without cause or resignation for good reason in connection with a change in control of the Company, Ms. Arasimowicz is to receive accelerated vesting of her outstanding and unvested restricted stock unit awards and it is deemed that the target performance goals of Ms. Arasimowicz’s performance stock units had been met at the time of a change in control and that such performance stock units were prorated based on the elapsed portion of the performance period. As of October 31, 2020, Ms. Arasimowicz held 105,179 unvested restricted stock units and 70,338 performance stock units, which for purposes of this table were prorated based on the elapsed portion of the performance period, which as of October 31, 2020 was one year. As of October 31, 2020, Ms. Arasimowicz did not hold any options to purchase shares of our common stock.
(4)
The value of the restricted stock unit awards and the prorated performance stock units on October 31, 2020 is based on 105,179 restricted stock units and 23,446 performance stock units at $2.00 per share.
(5)
Ms. Arasimowicz is eligible to receive payment of continued health insurance for a period of six months in the event her employment is terminated without cause or she resigns for good reason and 12 months if her employment is terminated without cause or she resigns for good reason in connection with a change in control of the Company. The value of continued health insurance is based on the medical and dental insurance rates in effect for all employees of the Company as of October 31, 2020.
(6)
In the event Ms. Arasimowicz’s employment is terminated without cause or she resigns for good reason, she is eligible to receive a severance payment equal to six months of her base salary. In the event her employment is terminated without cause or she resigns for good reason in connection with a change in control of the Company, she is eligible for 12 months of her base salary plus a bonus payment for the severance period equal to the average of the bonuses awarded to her since her promotion to General Counsel and Corporate Secretary.
POTENTIAL PAYMENTS AND BENEFITS UPON A TERMINATION OF EMPLOYMENT OR A CHANGE IN CONTROL OF THE COMPANY FOR MR. LISOWSKI
Executive Payments and Benefits(1)
Termination without
Cause or Resignation
for Good Reason
($)(2)
Death or
Disability
($)(2)
Following Change
in Control of
the Company
($)(2)
Accelerated vesting:
Stock options(3)
Restricted Shares/Stock Units(3)(4)
213,690
Payment for annual incentive award 156,250
Continued Health Insurance Premiums(5) 17,028 34,057
Severance payment(6) 162,500 325,000
TOTAL
179,528
728,997
(1)
For purposes of this analysis, we have assumed that Mr. Lisowski’s compensation is as follows: a base salary equal to $325,000 and a $156,250 annual incentive award payment in fiscal year 2019, the year of his appointment as an executive officer of the Company, and that Mr. Lisowski has outstanding restricted stock and restricted stock unit awards as reflected in the Outstanding Equity Awards at 2020 Fiscal Year-End Table, on page 38 of this Proxy Statement and target performance stock unit awards as reflected in the Fiscal Year 2020 Grants of Plan-Based Awards table on page 37 of this Proxy Statement. These amounts reflect the terms of his compensation package approved by the Compensation Committee, effective August 1, 2019.
42   FUELCELL ENERGY, INC. | PROXY STATEMENT

Executive Compensation
 
(2)
Assumes Mr. Lisowski’s date of termination of employment was October 31, 2020. The market price of our common stock on October 30, 2020 was $2.00 per share.
(3)
Assuming termination without cause or resignation for good reason in connection with a change in control of the Company, Mr. Lisowski is to receive accelerated vesting of his outstanding and unvested restricted stock and restricted stock unit awards and it is deemed that the target performance goals of Mr. Lisowski’s performance stock units had been met at the time of a change in control and that such performance stock units were prorated based on the elapsed portion of the performance period. As of October 31, 2020, Mr. Lisowski held 84,877 unvested restricted stock units and 65,904 performance stock units, which for purposes of this table were prorated based on the elapsed portion of the performance period, which as of October 31, 2020 was one year. As of October 31, 2020, Mr. Lisowski did not hold options to purchase shares of our common stock.
(4)
The value of the restricted stock unit awards and the prorated performance stock units on October 31, 2019 is based on 84,877 restricted stock units and 21,968 performance stock units at $2.00 per share.
(5)
Mr. Lisowski is eligible to receive payment of continued health insurance for a period of six months in the event his employment is terminated without cause or he resigns for good reason and 12 months if his employment is terminated without cause or he resigns for good reason in connection with a change in control of the Company. The value of continued health insurance is based on the medical and dental insurance rates in effect for all employees of the Company as of October 31, 2020.
(6)
In the event Mr. Lisowski’s employment is terminated without cause or he resigns for good reason, he is eligible to receive a severance payment equal to six months of his base salary. In the event his employment is terminated without cause or he resigns for good reason in connection with a change in control of the Company, he is eligible for 12 months of his base salary plus a bonus payment for the severance period equal to the average of the bonuses awarded to him since his appointment as our Chief Operating Officer.
POTENTIAL PAYMENTS AND BENEFITS UPON A TERMINATION OF EMPLOYMENT OR A CHANGE IN CONTROL OF THE COMPANY FOR MR. LEO