THO Thor Industries

Our net income dropped in 2019 after averaging 25% growth per year over the prior six (6) years. The drop in 2019 was driven by the expenses related to the EHG acquisition, lower top line sales, and an increase in production costs which were impacted by the current U.S. tariff policy. Acquisition expenses (net of tax), both one-time and recurring, reduced our net income by $212 million. Without these expenses, Fiscal Year 2019 was our third most profitable year, ever.

NET INCOME (IN MILLIONS)

from Continuing Operations attributable to Thor Industries, Inc.

Sales

After six (6) years of aggressive growth in our sales, we experienced a decline in 2019 as excess dealer inventory created a material difference between retail and wholesale sales. The sales decline was softened by the inclusion of 6 months of EHG net sales in our consolidated total.

NET SALES (IN BILLIONS)

from Continuing Operations

Diluted EPS

Both one-time and recurring expenses related to the EHG acquisition reduced our EPS by $3.93. Including these expenses, our EPS was $2.47

DILUTED EPS

from Continuing Operations attributable to Thor Industries, Inc.

Cash Generation

Our great ability to generate cash is demonstrated well in a year that saw a decline in both sales and earnings yet set our all-time record for cash generation.

CASH GENERATED BY OPERATIONS (IN MILLIONS)

from Continuing Operations

History of Increasing

Regular Dividends

Thor’s ultimate mission is to return value to our Shareholders. An important component of that mission is our dividend policy. To that end, Thor has increased its regular cash dividends each of the last nine (9) years and recently announced an increase in the dividend awarded in the first quarter of Fiscal Year 2020. Over the last six (6) years, Thor’s dividend has grown at an APR of over 14% and the dividend rate of Fiscal Year 2019 offered a yield of 2.6% of our year end stock price of $59.60.

REGULAR DIVIDENDS

General Information about Our Annual Meeting

A copy of this Proxy Statement and our Annual Report for the fiscal year ended July 31, 2019 (“Fiscal Year 2019”), will be sent to any Shareholder who requests a copy through any of the following methods:

The Annual Report is not to be considered a part of this proxy soliciting material.

Voting Instructions and Information

WHO CAN VOTE

You are entitled to vote if our records show that you held shares in our Company as of the Record Date, October 18, 2019. At the close of business on that date, 55,198,756 shares of our Common Stock were outstanding and entitled to vote. Each share of our Common Stock is entitled to one vote. A list of Shareholders entitled to vote at the Annual Meeting will be available for examination by Shareholders at the Meeting and during regular business hours at the Company’s office for ten (10) days prior to the Meeting.

HOW TO VOTE

In accordance with the rules of the Securities and Exchange Commission (the “SEC”), instead of mailing a printed copy of our proxy materials to each Shareholder of record, we may furnish our proxy materials, including this Proxy Statement and our Annual Report to Shareholders, by providing access to these documents on the Internet. Generally, Shareholders will not receive printed copies of the proxy materials unless they request them.

If your Common Stock is held through a broker, bank, or other nominee (held in “street name”), you will receive instructions from the entity holding your stock that you must follow in order to have your shares voted. If you want to vote in person, you must obtain a legal proxy from the entity holding your shares and bring it to the Meeting.

If you hold shares in your own name as a holder of record with our transfer agent, Computershare, you may instruct the proxies how to vote by following the instructions listed on the Notice of Internet Availability (“Notice Card”) or the proxy card (if printed materials were requested). Of course, you can always come to the Meeting and vote your shares in person.

Shareholders may vote their shares in any of the following ways:

Andrew Graves DIRECTOR SINCE: 2010     Age 60 Chairman of the Board

Thor Committees

Outside Directorships

Mr. Graves, who became a Director in December of 2010, was CEO for Motorsport Aftermarket Group, a leading manufacturer, distributor, and on-line retailer of aftermarket products for the powersports industry. He joined this privately- held group in January of 2015 as CEO and retired August of 2018. Previously, Mr. Graves served as the President of Brunswick Boat Group, a division of the Brunswick Corporation, an NYSE company. He was with Brunswick from 2005-2014. Prior to his time with Brunswick, Mr. Graves was President of Dresser Flow Solutions, a maker of flow control products, measurement systems, and power systems, from 2003 to 2005, and before that he was President and Chief Operating Officer of Federal Signal Corporation. Our Nominating and Corporate Governance Committee and Board believe that his extensive management experience in related consumer durable businesses whose products are distributed through a dealer network makes him an asset to our Board.

Amelia A. Huntington DIRECTOR SINCE: 2018     Age 53

Thor Committees

Outside Directorships

Ms. Huntington, who became a Director in October of 2018, served as the Chief Executive Officer of Philips Lighting Americas, a leading manufacturer of commercial and residential lighting solutions, until January of 2018, after serving as Chief Executive Officer of Philips Lighting, Professional Lighting Solutions, an assignment based in Amsterdam, The Netherlands. Prior to joining Philips Lighting in April 2013, Ms. Huntington held senior leadership positions with Schneider Electric over the course of a 22-year career, including Chief Operating Officer of Schneider Electric North America and CEO of subsidiary, Juno Lighting Group. Our Nominating and Corporate Governance Committee and Board believe that her extensive experience in multinational operations makes her an asset to our Board.

Wilson Jones DIRECTOR SINCE: 2014     Age 58

Thor Committees

Outside Directorships

Mr. Jones, who became a Director in August of 2014, is the President and Chief Executive Officer and a director of Oshkosh Corporation, a leading designer, manufacturer and marketer of a broad range of specialty vehicles and vehicle bodies. Mr. Jones joined Oshkosh Corporation in 2005 and held senior leadership positions in the Fire & Emergency Segment until July of 2007 when he became President of Pierce Manufacturing, Inc. From September of 2008 to September of 2010, Mr. Jones held the position of Executive Vice President and President of the Fire & Emergency segment. From September of 2010 to August of 2012, Mr. Jones led the Access Equipment Segment as Executive Vice President and President, the largest business segment of the company, until his appointment to President and Chief Operating Officer. He was named President and Chief Executive Officer in January of 2016. Our Nominating and Corporate Governance Committee believe his experience in specialty vehicles and management experience make him an asset to our Board.

Christopher Klein DIRECTOR SINCE: 2017     Age 56

Thor Committees

Outside Directorships

Mr. Klein, who became a Director in December 2017, is the Chief Executive Officer and a director of Fortune Brands Home & Security, Inc., a leading manufacturer of home and security products. Mr. Klein joined Fortune Brands, Inc. in 2003 and held corporate strategy, business development, and operational positions until he became CEO of Fortune Brands Home & Security in 2010. Previously, Mr. Klein held key strategy and operating positions at Bank One Corporation and also served as a partner at McKinsey & Company, a global management consulting firm. Mr. Klein spent his early career in commercial banking, at both ABN AMRO and First Chicago. Our Nominating and Corporate Governance Committee and Board believe that his management experience as chief executive officer of a public company, as well as his treasury and consulting background make him an asset to our Board.

J. Allen Kosowsky DIRECTOR SINCE: 2010     Age 71

Thor Committees

Outside Directorships

Mr. Kosowsky, who became a Director in March of 2010, is a certified public accountant who since 1985 has conducted business through his own advisory firm. The firm provides services that include business and intellectual property valuations, forensic accounting and financial analysis, and alternative dispute resolutions. From January of 2003 to February of 2010, Mr. Kosowsky served as the Chairman of the board of directors and Chairman of the audit committee for ON2 Technologies Inc., a U.S. based video compression software company, which was acquired by Google, Inc. On September 17, 2016, Mr. Kosowsky became a National Association of Corporate Directors fellow. In June of 2017, Mr. Kosowsky joined the board of BlackRidge Technology International, Inc., a cyber security software company and serves as the Lead Director, Chair of the audit committee, and a member of the compensation and nominating and governance committees. Our Nominating and Corporate Governance Committee and Board believe that his extensive accounting experience and his financial expertise and training, which qualify him as an “audit committee financial expert”, make him an asset to our Board.

Robert W. Martin DIRECTOR SINCE: 2013     Age 50

President and Chief Executive Officer

Jan H. Suwinski DIRECTOR SINCE: 1999     Age 78

Thor Committees

Outside Directorships

Mr. Suwinski was our Independent Lead Director from 2013 to August of 2019. He became a Director in July of 1999, joined the faculty of the Samuel-Curtis Johnson Graduate School of Management, Cornell University in July of 1996 and served as its Clinical Professor of Management and Operations, where he co-taught the Strategic Operations Immersion course, as well as courses in Business Strategy and Strategic Alliances. Mr. Suwinski retired from the faculty in June of 2016. Starting in 1965, Mr. Suwinski served in a variety of managerial roles at Corning, Incorporated, a global manufacturing company. From 1990 to 1996, Mr. Suwinski was Executive Vice President, Opto Electronics Group at Corning, Incorporated and, from 1992 to 1996, Mr. Suwinski was Chairman of Siecor, a Siemens/Corning joint venture. Mr. Suwinski was formerly a director of ACI Worldwide, Inc. and Tellabs, Inc. Mr. Suwinski served on the board of directors of Ohio Casualty Group, Inc. from 2002 to 2007. Our Nominating and Corporate Governance Committee and Board believe that his management experience and his significant public company board experience make him an asset to our Board.

James L. Ziemer DIRECTOR SINCE: 2010     Age 69

Thor Committees

Outside Directorships

Mr. Ziemer, who became a Director in December of 2010, was the President and Chief Executive Officer at Harley Davidson, Inc. from 2005-2009 and served as a director for that company from 2004-2009. Mr. Ziemer joined Harley-Davidson in 1969 and held a series of positions in manufacturing, engineering, accounting, parts and accessories, and finance. From 1991 until his election as the President and Chief Executive Officer of Harley-Davidson in 2005, he served as the Chief Financial Officer. Mr. Ziemer also served as President of The Harley-Davidson Foundation, Inc. from 1993 to 2006. Our Nominating and Corporate Governance Committee and Board believe that Mr. Ziemer’s substantial management experience, including as a chief executive officer of a public company, and his financial expertise and training, which qualify him as an “audit committee financial expert”, make him an asset to our Board.

Corporate Governance

Good corporate governance is the foundation upon which our Company operates. The process of good corporate governance is dynamic, requiring constant vigilance and evaluation to determine and implement those governance practices that are best-suited to provide integrity and transparency in and to our business. At Thor, our Board and management are dedicated to the process of constant evaluation and active implementation of appropriate governance processes, practices, and policies. Thor’s Board-adopted Governance Guidelines serve as the framework for consistently effective governance of the Company. The Guidelines are regularly reviewed and updated and are available for review on our website, www.thorindustries.com.

Board Selection Process

Our Nominating and Corporate Governance Committee screens candidates and recommends nominees to the full Board. Our By-laws provide that our Board may set the number of Directors at no fewer than one (1) and no more than fifteen (15). Our Board currently consists of nine (9) Directors - each Director will stand for election each year.

Our Nominating and Corporate Governance Committee has relied upon board search firms in identifying suitable candidates. During this process, the Board engages in an evaluation of a widely-diverse set of candidates. In Fiscal Year 2017, our Board adopted a diversity policy, requiring the initial list of prospective candidates to include qualified candidates with diversity of race, ethnicity, and gender. An important

consideration in our prospective Board member evaluation includes his or her obligation to their primary company and/ or to other boards that would detract from their obligation to fully serve on our Board. Further, the Committee will consider Shareholder nominations of candidates for our Board on the same basis as Board-identified candidates, provided that any such nominee possesses the requisite business, management, and educational experience.

Proxy Access

Our By-laws allow a group of up to twenty (20) Shareholders who have owned at least 3% of our outstanding shares for a period of at least three (3) years to nominate up to two (2) or 25% of the seats up for election, whichever is greater, and include those nominations in our Proxy Statement.

Board Structure And Leadership

Fiscal Year 2019 was a significant year for our Board structure and leadership. First, our Shareholders approved the Board’s request to declassify itself at last year’s Annual meeting. Then, at the end of our Fiscal Year, our long-term Executive Chairman and co-founder, Peter Orthwein, announced his retirement as Executive Chairman. Subsequently, Andy Graves was named Chairman, becoming Thor’s first independent Chairman. With Mr. Graves as our independent Chairman, our Board is led by strong Committee chairs, Messrs. Jones (Compensation and Development), Kosowsky (Nominating and Corporate Governance), and Ziemer (Audit).

Our Board has three Committees with the principal functions described below. The charters of each of these Committees are posted on our website at www.thorindustries.com and are available in print to any Shareholder who requests them.

AUDIT COMMITTEE

The principal functions of our Audit Committee include to:

COMPENSATION AND DEVELOPMENT COMMITTEE

The principal functions of our Compensation and Development Committee include to:

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

The principal functions of our Nominating and Corporate Governance Committee include to:

Director Independence

Of our nine Directors, only one is employed by our Company, our CEO Mr. Martin. With the exception of Mr. Martin and Mr. Orthwein (who retired as an employee of the Company at the end of Fiscal Year 2019), our Board is comprised entirely of “independent” Directors as that term is defined by both NYSE listing standards and our own Governance Guidelines. The Board conducts an annual review to determine the continued “independence” of all of our Independent Directors (currently, Messrs. Suwinski, Ziemer, Graves, Kosowsky, Klein, Jones, and Ms. Huntington).

Independent Director Meetings

Thor’s independent Directors, as an entire body or part thereof, meet in non-executive sessions that include Mr. Orthwein and all of the independent directors and in executive session of independent directors at the conclusion of each Audit Committee meeting and Compensation and Development Committee meeting as well as upon the conclusion of each Board meeting.

Director Attendance

During our Fiscal Year 2019, the Board of Directors held 13 meetings. In the aggregate, Directors attended 97% of the total meetings of the full Board. No Director attended less than 85% of the combined total meetings of the full Board and the Committees on which the Director served during this past year. All of the members of the Board are encouraged, but not required, to attend the Company’s Annual Meeting of Shareholders. All of those who were members of the Board at the time of the 2018 Annual Meeting, attended the Meeting.

Annual Board And Committee Evaluation

Each year, our Board conducts evaluations of each Committee and the Board as a whole. This process includes evaluation of the individual members of the Committees and the Board. The evaluation includes a process of dynamic feedback designed to identify areas of increased focus.

Board Risk Oversight

At both the full Board and Committee level, a primary function of our Board of Directors is to oversee the Company’s risk profile and the processes established by management for managing risk. Our Board and its Committees regularly evaluate these risks and the mitigation strategies employed by management. In general terms, our Committees oversee the following risks:

AUDIT COMMITTEE

All risks related to financial controls, including all applicable legal, regulatory, and compliance risks, as well as the overall risk management governance structure, including evaluating and responding to the assessments of both our internal audit department and our external auditors.

COMPENSATION AND DEVELOPMENT COMMITTEE

All risks associated with the design and elements of our compensation program and related compliance issues, and all risks associated with the process of developing our people and succession planning.

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE:

All risks within the scope of the Company’s governance programs and applicable compliance issues.

In performing its oversight responsibilities, the Board relies, in part, upon the results and information gained through the Company’s Enterprise Risk Management Program, and considers the program for amendment, as appropriate. The program is designed to ensure appropriate risk monitoring of, and controls over, risks associated with our business. Risks evaluated through the program include, but are not limited to, strategy, acquisition integration, legal, compliance, human resources, mergers & acquisitions, IT & cyber security, operations, and finance risks.

The Board receives regular reports from management regarding the status of its risk management programs, and provides input and direction designed to keep the risk management programs effective against dynamic and ever-evolving risks applicable generally to commercial enterprises and specifically to our Company.

The Board and management have developed a culture of risk awareness and risk management that includes annual Company-wide ethics training. Through this constant process, the Company gains input from a great number of its employees as it evaluates risks and updates its management plan accordingly.

Diversity Policy

In Fiscal Year 2017, our Board formalized a diversity policy that it has followed in recent Board candidate searches. Under the Board’s diversity policy, the initial list of candidates to be considered must include qualified candidates with diversity of race, ethnicity, and gender.

Succession Planning

Our Board is actively engaged and involved in talent management. Our succession plan and talent management programs are reviewed semi-annually with the Compensation and Development Committee, and then reviewed and considered by the full Board. These discussions include an ongoing evaluation of our talent and leadership bench and the succession plan that envisions those individuals’ advancement to key positions in our Company.

In addition, high-potential employees are regularly evaluated and engaged in comprehensive training, both on the job and in the classroom. During Fiscal Year 2016, we instituted a program of executive studies through the University of Notre Dame in which high-potential employees and top-level management participate in a series of comprehensive programs designed to provide further education relevant to their job functions. This program runs annually and provides a mechanism for the advancement of key employees.

Mandatory Resignation Policy

In Fiscal Year 2017, our Board implemented a mandatory age-based resignation policy, requiring each Director who is 72 years of age or older to submit his or her resignation for consideration by the Board at our October Board meeting for action at our Annual Meeting. If the Board accepts the Director’s resignation at the October Board meeting, the Director’s resignation would be effective at the Annual Meeting.

Shareholder Communications

We encourage Shareholder communication with the Company. Any communications from interested parties directed toward our Board or independent Directors specifically may be sent to Andy Graves, our independent Chairman, who forwards to each of the other Board members or independent Directors, as appropriate, any such communications that, in the opinion of Mr. Graves, deal with the functions of our Board or the Committees thereof or that he otherwise determines require their attention. Mr. Graves’ address for this purpose is c/o Thor Industries, Inc., Attention: Corporate Secretary, 601 East Beardsley Avenue, Elkhart, IN 46514.

Code Of Ethics

We have adopted a written code of ethics, the “Thor Industries, Inc. Business Ethics Policy”, which is applicable to all of our Directors, Officers, and employees, including our principal Executive Officer, Principal Financial Officer, Principal Accounting Officer or Controller, and other Executive Officers identified in this Proxy Statement who perform similar functions (collectively, the “Selected Officers”). Our code of ethics is posted on our website found at www.thorindustries.com and is available in print to any Shareholder who requests it. Each year members of the management teams at each of our subsidiaries, as well as our NEOs, engage in training on our Business Ethics Policy. We intend to disclose any changes in, or waivers from, our code of ethics applicable to any Selected Officer on our website or by filing a Form 8-K with the SEC.

Our Governance Practices

Thor is committed to governance principles that are designed to be in the best interest of our Shareholders. Our Board evaluates each governance principle as it uniquely applies to Thor. In some instances, this leads our Board to adopt and/or maintain policies that it deems in the best interest of Thor that may not be fully consistent with the views held by others. These decisions and determinations are not made lightly; instead, great consideration is given to the adoption of principles best suited to Thor’s long-term success. Controlling governance principles include:

Ms. Zuhl, a Certified Public Accountant, joined our Company in June of 2011 and currently serves as Senior Vice President and Chief Financial Officer. Prior to accepting her role as Vice President and Chief Financial Officer in October of 2013, Ms. Zuhl served the Company as Vice President and Controller from February of 2013 to October of 2013, Interim Chief Financial Officer from October of 2012 to February of 2013, and Director of Finance from June of 2011 to October of 2012. Prior to joining our Company, Ms. Zuhl served as Chief Financial Officer of All American Group, Inc. (formerly known as Coachmen Industries, Inc.), then a recreational vehicle and manufactured housing company listed on the NYSE, from August of 2006 to June of 2011.

Mr. Woelfer joined our Company in August of 2012, and currently serves as Senior Vice President, General Counsel, and Corporate Secretary. Prior to joining our Company, Mr. Woelfer served as managing partner of May Oberfell Lorber where his practice focused on advising corporate clients. From May of 2007 through May of 2010, Mr. Woelfer served as General Counsel to All American Group, Inc. (formerly known as Coachmen Industries, Inc.), then a recreational vehicle and manufactured housing company listed on the NYSE.

Mr. Julian has been with our Company since March of 2004, and currently serves as Senior Vice President of Administration and Human Resources. Mr. Julian served as Vice President, Human Resources from July of 2009 until August of 2014. Mr. Julian previously served as Vice President of Administration of Keystone RV from March of 2004 to June of 2009. Prior to joining our Company, Mr. Julian served as the Director of Operations and Human Resources, as well as Corporate Secretary, for Ascot Enterprises, Inc. from February of 1989 to March of 2004.

In addition to telling you what our compensation plan is, we explain why the Compensation and Development Committee of our Board of Directors believes our plan to be in the best interest of each of you, our Shareholders.

Our Business

Thor owns operating subsidiaries that, combined, form the largest manufacturer of recreational vehicles in the world. In Fiscal Year 2019, Thor completed a transformational acquisition acquiring one of Europe’s largest RV manufacturer, the Erwin Hymer Group. For more information about our business, please see “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K filed with the SEC on September 30, 2019.

2019 Business Highlights

In Fiscal Year 2019, our top and bottom lines were impacted by an industry-wide dealer inventory correction that affected much of our year. As a consequence, our sales declined from our all-time high of $8.33 billion to $7.86 billion. This industry-wide challenge to sales fostered an incredibly competitive environment which put downward pressure on margins as did the tariff dispute with China. The North American market also experienced a retail slowdown in our Fiscal Year 2019 after years of significant growth. Our pre-tax earnings were also significantly impacted by both one-time and recurring transaction expenses of acquiring EHG which totaled over $268 million in Fiscal Year 2019. The combination of these factors contributed heavily to a drop in our net income before tax to $185 million. Additionally, macroeconomic uncertainty and speculation put pressure on consumer discretionary stocks during our Fiscal Year. Consequently, our stock price declined over the year. As we look ahead, the acquisition of the Erwin Hymer

Group sets the course for significant future growth in both Europe and North America. Since closing the transaction on February 1, 2019, management has been focused on integration and ensuring realization of great synergies and significant opportunities offered by the deal and upon improving operating margins in our North American operations. In the last quarter of 2019, the fruits of those efforts began to materialize as the company realized significant margin improvement.

Key highlights from this past Fiscal Year include:

NET SALES (IN BILLIONS)

from Continuing Operations

NET INCOME (IN MILLIONS)

from Continuing Operations attributable to Thor Industries, Inc.

DILUTED EPS

from Continuing Operations attributable to Thor Industries, Inc.

Since our inception, we have utilized a pay plan originally established in 1980 by our founders which tied incentive pay directly to financial performance which was measured by net income before tax (“NBT”). Our plan was an annual plan that was exclusively cash- based until 2012 when we introduced our Restricted Stock Unit program. The plan kept tight alignment between pay and Company performance and received favorable recommendations from the leading proxy advisory firms as a consequence of this alignment despite the fact that our plan’s architecture was generally disfavored as it relied upon a single metric, our NBT. Despite the success of our historical pay plan, we frequently evaluated the plan and considered alternatives to determine if other plans might align pay even more appropriately with our shareholder return.

In 2019, downward pressure on our stock price caused our stock price to drop to a level that we believe is misaligned with the value of our Company. This created a divergence between pay and shareholder value (measured by our stock price) at the end of our fiscal year that we deemed unacceptable. Also, during the year, we completed the transformational acquisition of EHG. Both management and the Board understood that the combined earnings from North America and Europe could result in excessive pay under the old plan and potentially amplify this variance. These two factors were significant changes from prior

years and were key reasons why we became determined to evolve our plan, to preserve alignment with our shareholders, and to keep compensation comfortably within the range of our peer group benchmarks, while at the same time being mindful of the historical success of our prior plan and the support for that plan evidenced by our say on pay votes.

Our New Plan

Our new plan is comprised of a base salary, our Management Incentive Plan (“MIP”), and a long-term incentive (“LTI”) component that is comprised of equal parts Restricted Stock Units (“RSUs”) and Performance Share Units (“PSUs”). The new plan retains NBT and RSU elements, which we believe have clearly provided a reliable tether between pay and shareholder return through the years. The new plan introduces new concepts, including PSUs and the metrics used to determine the PSUs, Return on Invested Capital (“ROIC”), and Free Cash Flow (“FCF”). The PSUs are measured over a three year period (for Fiscal Year 2020 this measure is over a two year period of the North American Operations and for the Fiscal Years that follow the measure will be three years for the global operations).

Importantly, we leaned heavily on the results of our engagement with both proxy advisory firms and our shareholders in developing the evolution of our plan. For years, we have valued our direct engagement on our compensation plan with both ISS and

appropriately when performance does not. Accordingly, we do not actively revisit the outputs from our program to adjust pay upward or downward. While we have, on very limited occasion, issued unplanned discretionary bonuses in the circumstances of a limited, not likely to be repeated, outstanding performance, we otherwise do not generally exercise discretion in awarding compensation to our NEOs.

restated financial statement impacts the amount of incentive compensation that should have been paid under any incentive based pay program.

award before any change in control would result in the accelerated vesting of such award.

Base Salary

Base salaries are part of the compensation package paid to our executives and are determined according to various factors, including benchmarking, experience, talent, contribution, industry standards, expectations, and performance.

On an annual basis, all employees’ base salaries are reviewed for possible adjustments. Adjustments, though, are not automatic. Instead, they are determined in conjunction with available benchmarking data and/or merit-based factors, driven either by exceptional performance or promotion that often is based on experience with our Company. For our executives, the Compensation and Development Committee considers the market practices of our peer group as a guide for recognized ranges of compensation.

For Fiscal Year 2019, no adjustment to base salaries were made.

Variable Incentive Compensation

The variable, performance-based elements comprise the vast majority of our NEOs’ compensation. The elements, our MIP and LTI, are determined based on our NBT. For Fiscal Year 2019, our NEOs’ compensation was approximately 82% incentive-based pay. Our philosophy promotes heavy reliance on variable performance-based pay. For Fiscal Year 2019, there were no changes from the prior year’s sharing percentages.

Cash-Based Variable Incentive Awards

Cash incentive compensation consists of our MIP. We generally rely on true GAAP numbers for the purposes of calculating our NBT and do not otherwise manipulate earnings in any way. The financial metrics for the performance-based cash incentive compensation for our NEOs are determined prior to our Fiscal Year or within the first portion thereof. The amount of cash incentive compensation for our NEOs is generally calculated and paid on a quarterly basis.

Anti-Hedging and Pledging Policy

Our Company prohibits our Executive Officers and members of its Board of Directors from engaging in any hedging transactions, transacting short sales, or pledging any Company stock.

Severance Plans and Change in Control Agreements

Our Company does not typically enter into written employment agreements for severance or for compensation in the event of a change in control. Our key employees are important to the Company’s long-term success and their value is determined by their efforts to improve our performance. From those efforts, these employees create their own protection in the event of a change in control or employment circumstance. Currently, none of our NEOs has such an agreement with the Company.

Prior to Fiscal Year 2016, the Thor Industries, Inc., 2010 Equity and Incentive Plan (our “2010 Plan”) specified that, upon the occurrence of a change in control, all options and/or restricted stock and restricted stock unit awards will automatically become vested and exercisable in full and all restrictions or conditions, if any, on any restricted stock or restricted stock unit awards would automatically lapse. In Fiscal Year 2015, the Board voted to amend this plan commencing with restricted stock units awarded based on Fiscal Year 2016 results to require a “double trigger” before such shares would vest. The “double trigger” provides that vesting would

occur only upon the occurrence of both a Change in Control (as defined in the 2010 Plan) and either a corresponding change in employment status or the failure of an acquirer to assume the awards. This “double trigger” requirement is a key element in the Thor Industries, Inc. 2016 Equity and Incentive Plan that was approved by the Shareholders at our Fiscal Year 2017 Annual Meeting.

The aggregate value of change in control and termination benefits for each NEO is summarized under the subheading, “Potential Payments Upon Termination or Change in Control and Agreements with Resigning Officers” on page 71.

Section 409A of the Code

Our compensation plans and programs are designed to comply with Section 409A of the Code, which places strict restrictions on plans that provide for the deferral of compensation.

The Compensation Committee

Our Compensation and Development Committee is responsible for the oversight of our compensation plan. Each year, the Compensation and Development Committee engages in a thorough evaluation of the performance of our NEOs.

The Board of Directors conducts a review of our CEO, Mr. Martin. These evaluations are significant factors to the Committee as it determines the base salary and incentive compensation elements of the compensation plans for the CEO.

Mr. Martin does not participate in his own performance evaluation or in setting his own compensation. For the other NEOs, the Chairman and CEO evaluate each NEO’s individual performance and recommend a tailored compensation plan for that individual to the Compensation and Development Committee. The Compensation and Development Committee then reviews and votes to approve or modify these recommendations.

For more information on the Compensation and Development Committee, view our Corporate Governance Section of this Proxy Statement. Additionally, the Compensation and Development Committee’s charter can be found on our website at www.thorindustries.com.

Our Independent Compensation Consultant

In Fiscal Year 2019, the Compensation and Development Committee utilized Willis Towers Watson as its compensation

consultant. Willis Towers Watson reports directly to the Committee, and the Committee is empowered to retain or replace Willis Towers Watson or hire additional consultants at any time. A representative of Willis Towers Watson regularly attends the Committee meetings and provides data and advice to the Committee throughout the year. Additionally, a representative from Willis Towers Watson regularly meets in executive session with the Committee.

Willis Towers Watson’s role is to provide market and peer group data and to advise the Committee on compensation-related decisions.

During Fiscal Year 2019, the compensation consultant provided the following services to the Committee:

In Fiscal Year 2019, the total fees and expenses attributable to Willis Towers Watson were $228,185.72.

Our Compensation Peer Group

Importantly, Willis Towers Watson assists the Committee in determining an appropriate compensation peer group. Our Company has a unique challenge in its peer review process. With the exception of two competitors who are not reasonable compensation peers due to significant size differences, none of the companies with whom we compete for talent are publicly-traded and, therefore, our competitors do not publicly disclose their compensation practices. Geographic proximity to our competitors makes the competition for key talent an ever-present challenge. Our compensation plans are developed with that fact in mind and are designed to attract and retain industry-leading talent through a program that is reasonable and heavily tied to our Company’s financial performance. In Fiscal Year 2019, as it has previously, Thor benchmarked its executive pay against a peer group of publicly-traded companies and used this data in conjunction with our own industry-specific knowledge in evaluating its executive compensation practices. The Compensation and Development Committee

periodically reviews and, as indicated, updates the peer group. Our general guidelines for our peer group are to include companies that are one-half to two times our revenue. In light of our expansion as a consequence of the EHG acquisition, we made two changes to our peer group while leaving most of the group as it has been the last couple of years. Our peer group represents manufacturing companies of similar size as expressed in sales and market capitalization. Additionally, we sought to identify manufacturing firms that introduce their products to market through dealerships or franchises. While the compensation peer group is not comprised of our market competitors, it nevertheless provides a somewhat meaningful basis for market comparison of our executive compensation packages. Included in our peer evaluation was the consideration of the disclosed peers of the members of our peer group. We believe the peer group below represents as good a comparator group as can currently be found for our Company. Our peer group for Fiscal Year 2019 consisted of the following companies:

Management and the Compensation and Development Committee will continue to regularly evaluate the risks associated with our compensation programs and will consider changes necessary to prevent incentives to take excessive risk. As a result of our most recent evaluation, we do not believe that our compensation programs created risks that are reasonably likely to have a material adverse effect on the Company. To the contrary, we believe that the programs promote sound business judgment and align employee performance with the realization of the Company’s strategic plan and maximization of Shareholder value.