gms-20230825

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. )


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GMS INC.
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Dear Fellow Shareholders,

At GMS, Inc., we have a clear vision – to be the premier distributor of building products in all of the markets we serve. By closing out another strong fiscal year of growth in sales and profits, we again demonstrated our commitment to our customers and to our values which guide our actions every day in the market.

We achieved record levels of net sales, net income, Adjusted EBITDA*, and cash flow generation for fiscal 2023. Net sales were $5.3 billion, an increase of 15% compared to the prior year, net income increased 22% to $333.0 million, net income as a percent of sales increased 30 basis points to 6.2%, Adjusted EBITDA* grew 17% to $665.7 million, and Adjusted EBITDA margin* improved 30 basis points to 12.5%. Net debt leverage improved from 1.8 times at the end of fiscal 2022 to 1.4 times at April 30, 2023. And, finally, during fiscal 2023, with an expanded authorization from our Board of Directors, we repurchased 2.3 million shares of common stock for $110.6 million, compared with 715,709 shares repurchased during fiscal 2022 for $35.5 million.

By staying focused on the execution of our four strategic priorities we have, again this year, grown the business and added significant value for our shareholders. Throughout our fiscal 2023, we made progress across these key priorities:

•Expand share in core products: We strengthened existing relationships and broadened our customer base across end markets in wallboard, steel framing and ceilings. As such, we believe that we continue to maintain or grow share in each of our core product categories.

•Grow complementary products: We furthered the growth of our complementary products. We expanded the AMES footprint. We entered the New York City market through the acquisition of Tanner Bolt & Nut, Inc., a leading distributor of tools, fasteners and other related construction products, and we purchased Blair Building Materials, Inc., a highly respected provider of complementary products in Ontario, Canada.

•Platform expansion: We completed four acquisitions and opened six new greenfield yards and 11 AMES stores. Expanding our footprint, scale, and product offerings remains a key priority, and we have a healthy list of opportunities in our pipeline of core and complementary focused businesses.

•Drive improved productivity and profitability: Through technology initiatives, we have generated improvements in efficiencies and profitability, such as consolidating certain back-of-house functions, furthering the roll-out of fleet optimization tools and using a more data-driven approach across the business in understanding and making decisions.

We are continually evaluating opportunities to ensure that our capital structure and allocation priorities align with our four-pillar strategy, balancing investing in our organic growth initiatives, pursuing accretive M&A transactions, paying down debt, and opportunistically leveraging favorable market conditions to repurchase shares.

As part of our commitment to sustainability and transparency, we are publishing our inaugural Corporate Social Responsibility Report, which is available on our website at https://www.gms.com/corporate-social-responsibility. The report utilizes the Sustainability Accounting Standards Board (SASB) and Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. The report highlights our focus on providing a safe work environment for our employees and customers. We are proud to have reduced our total recordable incident rate by 11% over the last two years. Our Corporate Social Responsibility Report also features disclosure of our Scope 1 and Scope 2 greenhouse gas emissions baseline and in terms of corporate governance, all directors are now elected annually following our previously announced board declassification.

___________________________________

*Adjusted EBITDA and Adjusted EBITDA margin are Non-GAAP financial measures. For a reconciliation of Adjusted EBITDA and Adjusted EBITDA margin to the most directly comparable GAAP measures, see Appendix.

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The credit for our performance goes to the more than 7,000 colleagues who work every day to provide exceptional customer service while our customers experience the familiarity of a local business. Looking ahead, we are entering fiscal 2024 aligned around the same commitment to deliver best-in-class service to our customers. While slower single-family housing conditions are expected to impact our results year over year in the near-term, over the longer-term, we believe that leveraging our scale, our extensive portfolio of products, and our expertise and ability to serve both commercial and residential customers should drive growth and bring value to all our stakeholders.

Thank you for your confidence and support of our company. We hope you will participate in our Annual Meeting in October. Your participation is important, so please exercise your right to vote.


Sincerely,

/s/ John J. Gavin						/s/ John C. Turner, Jr.
John J. Gavin						John C. Turner, Jr.
Chair of the Board of Directors						President and Chief Executive Officer

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GMS INC.

100 Crescent Centre Parkway, Suite 800

Tucker, Georgia 30084

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON OCTOBER 18, 2023

NOTICE IS HEREBY GIVEN that the 2023 Annual Meeting of Stockholders (the “Annual Meeting) of GMS Inc., will be held virtually on Wednesday, October 18, 2023, at 8:00 a.m. (Eastern Time), for the purposes of considering and acting on the four proposals below and any other business as may properly come before the Annual Meeting or any adjournments or postponements thereof:


Proposal		Board Recommendation
1	To elect the nine director nominees identified in this Proxy Statement	FOR each nominee
2	To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending April 30, 2024	FOR
3	To approve, on an advisory basis, the compensation of our named executive officers	FOR
4	To approve, by a non-binding advisory vote, the frequency of future advisory votes on the compensation of the Company’s named executive officers	1 YEAR

This year’s Annual Meeting will be held in a virtual format only. We believe this format enhances stockholder access to the Annual Meeting by enabling stockholder attendance and participation from anywhere, without cost. Stockholders of record at the close of business on September 1, 2023 are entitled to receive notice of and to vote at the Annual Meeting and any adjournment or postponement thereof.

It is important that your shares be represented and voted whether or not you plan to attend the Annual Meeting. You may vote on the Internet, by telephone or by completing and mailing a proxy card. Voting over the Internet, by telephone or by written proxy will ensure your shares are represented at the Annual Meeting.

Securities and Exchange Commission rules allow companies to furnish proxy materials to their stockholders on the Internet. We are pleased to take advantage of these rules and believe that they enable us to provide you with the information you need, while making delivery more efficient and more environmentally friendly. In accordance with these rules, a Notice of Internet Availability of Proxy Materials containing instructions on how to access this Proxy Statement and our fiscal 2023 Annual Report is first being mailed on or about September 8, 2023 to all stockholders entitled to vote at the Annual Meeting. The Notice of Internet Availability of Proxy Materials also provides instructions on how to vote online, by telephone or by completing and mailing a proxy card and includes instructions on how to request a printed set of the proxy materials.


			By Order of the Board of Directors,

			/s/ Craig D. Apolinsky
			Craig D. Apolinsky
			Senior Vice President, General Counsel and Corporate Secretary

Tucker, Georgia

September 8, 2023

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IMPORTANT INFORMATION REGARDING THE AVAILABILITY OF PROXY MATERIALS

This Notice of Meeting, Proxy Statement, Proxy Card and our fiscal 2023 Annual Report, which includes our Annual Report on Form 10-K for the fiscal year ended April 30, 2023, are available at investor.gms.com.

YOUR VOTE IS VERY IMPORTANT. PLEASE CAREFULLY READ THE ATTACHED PROXY STATEMENT. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, WE URGE YOU TO VOTE AND SUBMIT YOUR PROXY OVER THE INTERNET, BY TELEPHONE OR MAIL.

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GMS INC.

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PROXY HIGH L IGHTS			1
PROPOSAL 1—ELECTION OF DIRECTORS			5
BOARD SELECTION AND ELECTION			16
DIRECTOR SELECTION PROCESS			16
BOARD DIVERSITY			16
BOARD DECLASSIFICATION			16
BOARD OF D IRECTOR S ' INDEPENDENCE			16
BOARD GOVERNANCE			17
CORPORATE GOVERNANCE GUIDELINES			17
CODE OF BUSINESS CONDUCT AND ETHICS			17
BOARD OVERSIGHT OF RISK MANAGEMENT			17
BOARD OVERSIGHT OF CYBERSECURITY AND INFORMATION SECURITY RISK			18
BOARD OVERSIGHT OF C ORPORATE SOCIAL RESPONSIBILITY			18
BOARD ORGANIZATION			18
BOARD LEADERSHIP STRUCTURE			18
MEETINGS OF THE BOARD AND COMMITTEES			18
EXECUTIVE SESSIONS OF NON-MANAGEMENT DIRECTORS			19
COMMITTEES OF THE BOARD			19
SUCCESSION PLANNING			21
HUMAN CAPITAL MANAGEMENT AND C OMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION			21
HEDGING AND PLEDGING POLICY			21
COMMUNICATIONS WITH THE BOARD			21
DIRECTOR COMPENSATION			22
DIRECTOR COMPENSATION PROGRAM			22
DEFERRED COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS			22
FISCAL 202 3 DIRECTOR COMPENSATION TABLE			22
PROPOSAL 2—RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			24
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S FEES AND SERVICES			24
POLICY ON AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND NON-AUDIT RELATED SERVICES OF INDEPENDENT AUDITORS			25
REPORT OF THE AUDIT COMMITTEE OF THE BOARD			26
MANAGEMENT			27
PROPOSAL 3—ADVISORY VOTE ON EXECUTIVE COMPENSATION			28
PROPOSAL 4—ADVISORY VOTE ON THE FREQUENCY OF ADVISORY VOTES ON EXECUTIVE COMPENSATION			29
EXECUTIVE COMPENSATION			30
COMPENSATION DISCUSSION AND ANALYSIS			30
COMPENSATION OF THE NAMED EXECUTIVE OFFICERS			41
SUMMARY COMPENSATION TABLE			41
FISCAL 202 3 GRANTS OF PLAN-BASED AWARDS			42
OUTSTANDING EQUITY AWARDS AT FISCAL 202 3 YEAR END			43
OPTIONS EXERCISED AND STOCK VESTED IN FISCAL 20 23			45
EMPLOYMENT AGREEMENTS			45
PAYMENTS UPON CERTAIN EVENTS OF TERMINATION OR CHANGES IN CONTROL			45
CEO PAY RATIO			48

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PAY V ERSUS PERFORMANCE			49
S TOCK OWNERSHIP			53
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			53
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			55
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS			56
RELATIONSHIPS AND TRANSACTIONS			56
POLICIES AND PROCEDURES FOR RELATED PERSONS TRANSACTIONS			56
GENERAL			57
IMPORTANT NOTICE REGARDING THE INTERNET AVAILABILITY OF PROXY MATERIALS			57
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING			57
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING			57
OTHER MATTERS			63
INCORPORATION BY REFERENCE			63
ACCESS TO REPORTS AND OTHER INFORMATION			63
LIST OF COMPANY STOCKHOLDERS			63
OTHER MATTERS THAT MAY COME BEFORE THE ANNUAL MEETING			63
APPENDIX A—RECONCILIATION OF NON-GAAP FINANCIAL MEASURES			A-1

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GMS INC.

100 Crescent Centre Parkway, Suite 800

Tucker, GA 30084

PROXY HIGHLIGHTS

We are providing these materials in connection with the 2023 Annual Meeting of Stockholders (the “Annual Meeting”) of GMS Inc. This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider. Please read the entire Proxy Statement carefully before voting as it contains important information about matters upon which you are being asked to vote.

2023 Annual Meeting of Stockholders

Date and Time

Record Date

Location

October 18, 2023 at 8:00 a.m. (local time)

September 1, 2023

This year’s meeting will be a virtual Annual Meeting at www.virtualshareholdermeeting.com/GMS2023

Proposals and Voting Recommendations


Proposal		Board Recommendation
1	To elect the nine director nominees identified in this Proxy Statement	FOR each nominee
2	To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending April 30, 2024	FOR
3	To approve, on an advisory basis, the compensation of our named executive officers	FOR
4	To approve, by a non-binding advisory vote, the frequency of future advisory votes on the compensation of the Company’s named executive officers	1 YEAR

About GMS

GMS Inc. (together with its consolidated subsidiaries, “we,” “our,” “us,” “GMS” or the “Company”), through its wholly owned operating subsidiaries, operates a network of more than 300 distribution centers with extensive product offerings of wallboard, ceilings, steel framing and complementary construction products. We also operate more than 100 tool sales, rental and service centers. Through these operations, we provide a comprehensive selection of building products and solutions for our residential and commercial contractor customer base across the United States and Canada. Our unique operating model combines the benefits of a national platform and strategy with a local go-to-market focus, enabling us to generate significant economies of scale while maintaining high levels of customer service.

Since our founding in 1971, we have grown our business from a single location to more than 300 distribution centers across 47 U.S. states and six Canadian provinces through a combination of strategic acquisitions, opening new distribution centers, and organic growth. Underpinning that growth is our entrepreneurial culture, which both enables us to drive organic growth by delivering outstanding customer service and makes us an attractive acquirer for smaller distributors.

Fiscal 2023 Business Highlights

Driving Growth in Product Lines, Diversifying Offerings & Expanding Service Territories

In fiscal 2023, we remained focused on building on our competitive advantage – significant scale, outstanding service and strong supplier relationships. The investments we have made over the past several years position us well for near-term supply and demand dynamics as well as long-term success.


7,000+	60+	300+	100+
Dedicated GMS Team Members	Leading Brands	Distribution centers across the U.S. and Canada	Tool sales, rentals and service centers

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Key Financial Highlights

In 2023, GMS achieved record-setting financial results with significant year-over-year growth, and continued to deliver value to you, our shareholders. Despite the challenges GMS and the broader economy faced, GMS reported record performance while maintaining a relentless focus on delivering best-in-class service for our customers, suppliers, and communities.

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Corporate Social Responsibility Highlights

GMS is committed to fostering good corporate social responsibility practices that support the success of our customers, employees, communities, shareholders and other stakeholders.

•Promoting Corporate Social Responsibility Transparency

◦Published our inaugural Corporate Social Responsibility report, available at www.gms.com/corporate-social-responsibility

◦Disclosed performance using the SASB and TCFD frameworks

•Offering Customers Cleaner, More Efficient Building Materials and Products

◦To support our work of offering more environmentally-friendly products, we partnered with a third party to identify the products we stock that have sustainability attributes

•Taking Action to Reduce Emissions

◦Established and disclosed our Scope 1 and Scope 2 greenhouse gas emissions baseline

◦Adopted first-of-their-kind battery powered hydraulic cranes to our fleet

◦Implementing operational energy efficiency measures including increased LED lighting

•Supporting Our Team Member Success

◦Improved our safety performance with an 11% decrease in our total recordable incident rate over the last two years

◦Continued formalized training programs aimed to retain traditionally underrepresented groups as part of our inclusion and diversity (“I&D”) program

Governance Highlights

The Board of Directors (the “Board”) of GMS is committed to strong corporate governance practices that reflect high standards of ethics and integrity and promote long-term stockholder value. Our Board continually analyzes our corporate governance practices in light of evolving practices as well as the Company’s changing business and shareholder base. As a result of this continued evaluation, over the past several years we have taken the following actions, among others, to strengthen our corporate governance practices:

•Added two female directors;

•Added two African American directors;

•Declassified the Board;

•Eliminated supermajority voting requirements in our Certificate of Incorporation (the "Charter") and Bylaws (the "Bylaws");

•Formally incorporated Corporate Social Responsibility oversight into our Nominating and Corporate Governance Committee Charter;

•Included human capital management oversight and risk monitoring in the Human Capital Management and Compensation Committee Charter; and

•Formally assigned oversight of cybersecurity and information technology risks to the Audit Committee.

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Compensation Highlights

The Human Capital Management and Compensation Committee of the Board continues its past practice of implementing performance incentives, pursuant to which the Company’s executives may earn annual cash incentives and long-term incentive compensation in the form of Company stock options and restricted stock unit awards.

The annual cash incentives for our named executive officers are based 80% on achievement of Adjusted EBITDA targets and 20% on achievement of working capital as a percentage of sales targets.

Every year, we provide for a stockholder advisory vote on executive compensation, which gives stockholders the opportunity to endorse or not endorse our named executive compensation program. At our 2022 Annual Meeting of Stockholders, our stockholders approved the Company’s named executive compensation program with 99% of the votes cast being voted in favor.

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PROPOSAL 1—ELECTION OF DIRECTORS

Our Board has nominated nine people for election as directors at the Annual Meeting. Each of the nominees currently is a director of the Company. If our stockholders elect these directors, then the directors will hold office until the annual meeting of stockholders in 2024, or until their successors have been duly elected and qualified, subject to the director’s earlier death or resignation or removal. The Board is now fully declassified and all Board members are standing for annual election.

Each of the Board’s nominees has consented to be named in this Proxy Statement and has agreed to serve if elected. If for some reason any of the Board’s nominees is unable to serve or for good cause will not serve if elected, the persons named as proxies may vote for a substitute nominee recommended by the Board and, unless you indicate otherwise on the proxy card, your shares will be voted in favor of the Board’s remaining nominees.

We believe each of the Board’s nominees meets the qualifications established by the Board for service on our Board and has professional experience in areas that are extremely relevant to our strategy and operations. We also believe that the skills, experience, backgrounds and attributes of the Board’s nominees make them the best candidates to serve on our Board.

The following table highlights specific experience, skills, qualifications and attributes of our directors that are important to us and how the composition of our nominees for the Board meets these needs. A director may possess additional experience, skills, qualifications and attributes, even if not specifically indicated below.

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Nominees for Election of Directors

The Board has nominated the following directors for election as directors for one-year terms expiring at the annual meeting of stockholders in 2024:


		Experience
		•	Big Lots, Inc., Executive Vice President, Chief Merchandising and Operating Officer (2015 – 2020), Executive Vice President, Chief Operating Officer (2012 – 2015), Senior Vice President, Supply Chain Management and Chief Information Officer (2010 – 2012), Senior Vice President Merchandise Planning and Allocation and Chief Information Officer (2005 – 2010), Senior Vice President Merchandise Planning, Allocation and Presentation (2002 – 2005), a leading discount retailer operating over 1,400 stores in 47 states
		•	Ames Department Stores, Inc., Senior Vice President Planning and Allocation (1997 – 2002), formerly the fourth-largest discount retailer in the country
Lisa M. Bachmann		•	Casual Corner Group, Inc., Vice President of Planning and Allocation, formerly an American retail clothing chain operating under the names Casual Corner, Petite Sophisticate and August Max Woman brands, among others, with more than 1,200 stores at its peak

Age: 62		Qualifications
		•	Public Company Leadership
Independent Director Since: 2020		•	Public Company Board Experience
		•	High Level of Financial Literacy
Committees		•	Distribution
•	Audit	•	Strategy Development
•	Nominating and Corporate	•	Mergers & Acquisitions
	Governance	•	Diversity

		Education
		•	BS, Accounting, Western New England University
		•	MBA, Western New England University

		Other Boards
		•	Currently serves on the board of directors of Dorman Products, Inc., a publicly traded company

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		Experience
		•	Peter Browning Partners, LLC, Managing Director (2009 – present), a board advisory firm
		•	Nucor Corporation, Lead Director, Non-Executive Chair (2006 – 2012); Non-Executive Chair (2000 – 2006), a publicly traded producer of steel and related products
		•	McColl Graduate School of Business at Queens University of Charlotte, North Carolina, Dean (2002 – 2005)
		•	Sonoco Products Company, President and Chief Executive Officer, President and Chief Operating Officer, and Executive Vice President (1993 – 2000), a manufacturer of industrial and consumer packaging products
Peter C. Browning		•	National Gypsum Company, Chair, President, and Chief Executive Officer (1989 – 1993), a privately held manufacturer and supplier of building and construction products

Age: 82		Qualifications
		•	Public Company Leadership
Independent Director Since: 2014		•	Public Company Board Experience
		•	High Level of Financial Literacy
Committees		•	Building Products or Construction Industry
•	Human Capital Management	•	Distribution
	and Compensation	•	Strategy Development
•	Nominating and Corporate	•	Mergers & Acquisitions
	Governance	•	Corporate Governance

		Education
		•	MBA, University of Chicago – Booth School of Business
		•	BA, History, Colgate University

		Other Boards
		•	Currently serves on the board of directors of ScanSource, Inc., a publicly traded company.
		•	Previously served on the board of directors of the following publicly traded companies: Acuity Brands, Inc., EnPro Industries, Inc., Lowe’s Companies, Inc., Nucor Corporation, The Phoenix Companies, Inc., Wachovia Corporation, Sykes Enterprises, and Loctite Corp.

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		Experience
		•	Goldman Sachs Value Accelerator, Operating Advisor (2021 – present), a centralized platform that partners with Goldman Sachs portfolio companies to build enduring businesses and create incremental value by leveraging the Goldman Sachs network
		•	LLR Partners, Inc., Senior Operating Advisor (2010 – 2017), a growth-oriented private equity firm
		•	Drake, Beam, Morin, Inc., Vice Chairman, Chief Executive Officer and President (2006 – 2009), an international career management and transitions management firm
		•	Right Management Consultants, Inc., President and Chief Operating Officer (1996 – 2004), a global provider of integrated consulting solutions across the employment lifecycle
John J. Gavin		•	Andersen Worldwide, Partner (1990 – 1996), a global firm providing a wide range of tax, valuation, financial advisory and related consulting services to individual and commercial clients

Age: 67		Qualifications
		•	Public Company Leadership
Independent Director Since: 2014		•	Public Company Board Experience
		•	High Level of Financial Literacy
Chair of the Board Since: 2019		•	Building Products or Construction Industry
		•	Strategy Development
Committees		•	Mergers & Acquisitions
•	Audit (Chair)	•	Corporate Governance

•	Nominating and Corporate	Education
	Governance	•	Graduate of Temple University

		Other Boards
		•	Currently serves on the board of directors of Dorman Products, Inc., a publicly traded company and on the Advisory Board on the Center for Corporate Governance for Drexel University, Philadelphia
		•	Previously served on the board of directors of the following publicly traded companies: CSS Industries, Inc., DFC Global Corp, and Interline Brands, Inc.
		•	Currently serves on the board of directors of various privately held companies

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		Experience
		•	NES Fircroft, Chief Executive Officer (2014 – present), a global solutions company specializing in recruiting and deploying engineering talent to meet client needs in more than 65 countries
		•	AEA Investors LP, Managing Director and Operating Partner (2013 – 2014), a leading global private investment firm
		•	Adecco Group North America, CEO (2007 – 2012), a multi-brand specialty staffing and workforce solutions company
		•	Spent 20 years with PricewaterhouseCoopers LLP and then IBM Business Consulting Services when it acquired PricewaterhouseCoopers Consulting; led the global supply chain management consulting services business, as well as the Americas consumer, wholesale distribution and software industry practices at IBM

Theron I. Gilliam		Qualifications
		•	Public Company Board Experience
Age: 58		•	High Level of Financial Literacy
		•	Building Products or Construction Industry
Independent Director Since: 2014		•	Strategy Development
		•	Mergers & Acquisitions

Committees		Education
•	Human Capital Management	•	MBA, Systems Engineering, Columbia University
	and Compensation	•	BS, Systems Engineering, University of Virginia

•	Nominating and Corporate	Other Boards
	Governance	•	Currently serves on the board of directors of Lennar Corporation, a publicly traded company
		•	Previously served on the board of directors of Work Market, Inc., a privately held company

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		Experience
		•	BlueLinx Holdings, Inc., Advisor to Chief Executive Officer (2022), President and Chief Executive Officer (2014 – 2021), a leading distributor of building and industrial products in the United States
		•	Euramax Holdings, Inc., now known as OmniMax International, Inc., President and Chief Executive Officer (2008 – 2013), Chief Operating Officer (2005 – 2008), Executive Vice President (2002 – 2005), Group Vice President (1997 – 2002), and President (1992 – 1997), a leading North American building products manufacturer.
		•	Alumax, Inc., Corporate Counsel, a fabricator of aluminum products for the transportation, distribution, building and construction, packaging, and consumer durables markets
Mitchell B. Lewis		•	Alston & Bird LLP, Attorney, Mergers and Acquisitions

Age: 61		Qualifications
		•	Public Company Leadership
Independent Director Since: 2019		•	Public Company Board Experience
		•	High Level of Financial Literacy
Committees		•	Building Products or Construction Industry
•	Audit	•	Distribution
•	Nominating and Corporate	•	Strategy Development
	Governance	•	Mergers & Acquisitions
		•	Corporate Governance

		Education
		•	BA, Economics, Emory University
		•	JD, University of Michigan Law School

		Other Boards
		•	Currently serves on the board of directors of BlueLinx Holdings, Inc., a publicly traded company, on the board of directors of Meteor Education, a privately held company, and on the board of directors of BCDI Meteor Holdings, LP, a Bain Capital Double Impact portfolio company
		•	Previously served on the board of directors of Euramax Holdings, Inc., a privately held company

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		Experience
		•	United Parcel Service, Senior Vice President, Executive Management Committee (2005 – 2019), an American multinational shipping & receiving and supply chain management company
		•	Prior roles with United Parcel Service include General Counsel and Corporate Secretary, Chief Human Resources Officer, and Senior Vice President of Compliance, Public Affairs, Communications, and Labor and Employment Counsel with subsequent roles in the legal department, compliance and operations before being promoted to the senior leadership team
		•	Troutman Sanders law firm now Troutman Pepper, Attorney, Civil Litigation and Labor & Employment

		Qualifications
Teri P. McClure		•	Public Company Leadership
		•	Public Company Board Experience
Age: 59		•	High Level of Financial Literacy
		•	Building Products or Construction Industry
Independent Director Since: 2019		•	Distribution
		•	Strategy Development
Committees		•	Mergers & Acquisitions
•	Human Capital Management	•	Corporate Governance
	and Compensation	•	Diversity

•	Nominating and Corporate	Education
	Governance (Chair)	•	BSBA, Economics and Marketing, Washington University in St. Louis
		•	JD, Emory University School of Law

		Other Boards
		•	Currently serves on the board of directors of Fluor Inc., Lennar Corporation and JetBlue, each a publicly traded company
		•	Serves as the Compensation Committee Chair of Lennar Corporation and JetBlue

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		Experience
		•	PepsiCo Frito-Lay North America, Senior Vice President and General Manager (1993 – 2017), one of the leading global companies in the snack chip industry Served in numerous positions of increasing responsibility covering operations, sales and marketing, customer engagement and strategy
		•	Procter & Gamble, Vice President, Sales and Marketing (1981 – 1993), an American multinational consumer goods corporation
		•	Maytag Corporation, Senior Vice President (1999 – 2001), an American home and commercial appliance company owned by Whirlpool Corporation

		Qualifications
Randolph W. Melville		•	Public Company Leadership
		•	Public Company Board Experience
Age: 64		•	Distribution
		•	Strategy Development
Independent Director Since: 2020		•	Diversity

		Education
Committees		•	BS, Sociology, Princeton University

•	Audit	Other Boards
•	Nominating and Corporate	•	Currently serves on the board of directors of Saia, Inc., a publicly traded company
	Governance	•	Serves as the Chair of the Compensation Committee of Saia, Inc.
		•	Serves on the Board of Trustees for Northwestern Mutual
		•	Previously served on the board of directors of Interline Brands, Inc. and as a member of the Compensation Committee of Interline Brands, Inc.

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		Experience
		•	Euramax International, Inc., Chair, Chief Executive Officer and President (1996 – 2008), a privately owned global producer of residential, commercial, and architectural building products
		•	Nortek, Inc., Chair (2010 – 2015) and Interim CEO (2011), a publicly owned producer of residential, commercial, and architectural building products

		Qualifications
		•	Public Company Leadership
		•	Public Company Board Experience
		•	High Level of Financial Literacy
J. David Smith		•	Building Products or Construction Industry
		•	Distribution
Age: 74		•	Strategy Development
		•	Mergers & Acquisitions
Independent Director Since: 2014		•	Corporate Governance

		Education
Committees		•	BA, Political Science, Gettysburg College

•	Audit	Other Boards
•	Human Capital Management and Compensation (Chair)	•	Currently serves on the board of directors of BlueLinx Holdings, Inc., a publicly traded company
•	Nominating and Corporate Governance	•	Previously served on the board of directors and committees of the following privately held companies: Air Distribution Technologies, Henry Company, Houghton International, Inc., DiversiTech, Inc., Chair of Siamons International, Inc., and Chair of Euramax International, Inc.
		•	Previously served on the board of directors and committees of publicly held companies: Chair, Select Interior Concepts, Inc., Chair of Nortek, Inc., and Commercial Metals Company

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		Experience
		•	Gypsum Management and Supply, Inc., President and Chief Executive Officer (2019 – Present), a leading distributor of construction products for commercial and residential building supply needs for local contractors in North America
		•	Dal-Tile, a division of Mohawk Industries, Inc., President (2012), Senior Vice President of Sales (2005), Senior Vice President of Operations (2008 – 2011), and Chief Operating Officer (2011 – 2012), the world’s leading global flooring manufacturer

		Qualifications
John C. Turner, Jr.		•	Public Company Leadership
		•	Public Company Board Experience
Age: 55		•	High Level of Financial Literacy
		•	Building Products or Construction Industry
Director Since: 2019		•	Distribution
		•	Strategy Development
Committees		•	Mergers & Acquisitions

•	None	Education
		•	BS BUAD, Marketing/Marketing Management, General, University of Southern California

		Other Boards
		•	Currently serves on the board of directors of TLB MM Corp., a privately held company

THE BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES LISTED ON THE PROXY CARD.

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BOARD SELECTION AND ELECTION

Director Selection Process

The Nominating and Corporate Governance Committee is responsible for reviewing the qualifications of potential director nominees and recommending to the Board those candidates to be nominated for election to the Board. The Nominating and Corporate Governance Committee does not apply any specific minimum qualifications when considering director nominees. Instead, the Nominating and Corporate Governance Committee considers all factors it deems appropriate, which may include, among others (a) ensuring that the Board, as a whole, is appropriately diverse and the extent to which a candidate would fill a present need on the Board, (b) the Board’s size and composition, (c) our corporate governance policies and any applicable laws, (d) individual director performance, expertise, relevant business and financial experience, integrity and willingness to serve actively, (e) the number of other public and private company boards on which a director candidate serves, and (f) consideration of director nominees properly proposed by third parties with the legal right to nominate directors or by stockholders in accordance with our Bylaws. The Board monitors the mix of specific experience, qualifications and skills of its directors in order to assure that the Board, as a whole, has the necessary tools to perform its oversight function effectively in light of the Company’s business and structure. As a matter of practice, the Board considers diversity in the context of the Board as a whole and takes into account considerations relating to race, ethnicity, gender and the range of perspectives that the directors bring to their work. Stockholders may also nominate directors for election at the Company’s annual stockholders meeting by following the provisions set forth in the Company’s Amended and Restated Bylaws, whose qualifications the Nominating and Corporate Governance Committee will consider.

Board Diversity

The Board considers qualified candidates for membership on the Board without regard to race, color, religion, sex, ancestry, sexual orientation, national origin or disability. Our objective is to have wide diversity in terms of business experiences, functional skills, gender, race, ethnicity and cultural backgrounds. We believe that enhancing our Board’s diversity is for the Company’s and stockholders’ long-term benefit. Two of our Board members are women (Teri P. McClure and Lisa M. Bachmann) and two are of a race other than white (Teri P. McClure and Randolph W. Melville).

Board Declassification

Our Board was previously divided into three classes, with members of each class serving staggered three-year terms. At the 2020 annual meeting of stockholders, our stockholders approved amendments to our Charter to declassify our Board and to provide for the annual election of directors, beginning at the 2021 Annual Meeting of Stockholders. The amendments provided for the phased elimination of the classified structure of the Board over a three-year period. As of the 2023 annual meeting of stockholders, our Board is fully declassified (and all Board members are standing for annual elections).

Board of Directors' Independence

New York Stock Exchange (“NYSE”) listing standards require us to have a majority of independent directors on our Board. Under our Corporate Governance Guidelines and NYSE listing standards, a director is not independent unless our Board affirmatively determines that he or she does not have a material relationship with us or any of our subsidiaries. Our Corporate Governance Guidelines define independence in accordance with the independence definition in the current NYSE corporate governance rules for listed companies. Our Corporate Governance Guidelines require our Board to review the independence of all directors at least annually. In the event a director has a relationship with the Company that is relevant to his or her independence and is not addressed by the objective tests set forth in the NYSE independence definition, our Board will determine, considering all relevant facts and circumstances, whether such relationship is material.

Our Board is comprised of one management director and eight non-management directors. Our Board has affirmatively determined that each of our eight non-management directors, Lisa M. Bachmann, Peter C. Browning, John J. Gavin, Theron I. Gilliam, Mitchell B. Lewis, Teri P. McClure, Randolph W. Melville and J. David Smith, are independent directors under the rules of the NYSE and independent directors as such term is defined in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Mr. John C. Turner, Jr., our President and Chief Executive Officer, our only management director, is not independent because of his position as an executive officer.

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BOARD GOVERNANCE

Corporate Governance Guidelines

We have adopted the GMS Inc. Corporate Governance Guidelines (our “Corporate Governance Guidelines”), which provide a framework for the governance of the Company as a whole and describe the principles and practices that the Board follows in carrying out its responsibilities. Our Corporate Governance Guidelines address, among other things:

• the composition, structure and policies of the Board and its committees;

• director qualification standards;

• expectations and responsibilities of directors;

• management succession planning;

• the evaluation of Board performance;

• principles of Board compensation; and

• communications with stockholders and non-management directors.

Our Corporate Governance Guidelines further provide that the Board, acting through the Nominating and Corporate Governance Committee (as described below), conduct a self-evaluation at least annually to determine whether it and its committees are functioning effectively. In addition, our Corporate Governance Guidelines provide that each committee conduct a self-evaluation and compare its performance to the requirements of its charter.

Our Corporate Governance Guidelines are posted on our website at investor.gms.com/govdocs. Our Corporate Governance Guidelines are reviewed by the Nominating and Corporate Governance Committee from time to time to ensure that they effectively promote the best interests of both the Company and the Company’s stockholders and that they comply with all applicable laws, regulations and NYSE requirements.

Code of Business Conduct and Ethics

We have adopted a code of ethics applicable to all of our directors, officers (including our principal executive officer, principal financial officer and principal accounting officer) and employees, known as the Code of Business Conduct and Ethics. The Code of Business Conduct and Ethics is available on our website at investor.gms.com/govdocs. In the event that we amend or waive certain provisions of the Code of Business Conduct and Ethics applicable to our principal executive officer, principal financial officer or principal accounting officer that requires disclosure under applicable Securities and Exchange Commission (“SEC”) rules, we will disclose the same on our website.

Board Oversight of Risk Management

Our Board administers its risk oversight function primarily through the Audit Committee and the Nominating and Corporate Governance Committee. To that end, our Audit Committee meets at least quarterly with our Chief Financial Officer and our independent auditors where it receives regular updates regarding our management’s assessment of risk exposures including liquidity, credit and operational risks, cybersecurity risks and the process in place to monitor such risks and review results of operations, financial reporting, and assessments of internal controls over financial reporting. Our Nominating and Corporate Governance Committee meets at least quarterly with our Chief Executive Officer and other executive leadership where it receives regular updates regarding our management’s assessment of risk exposures in addition to the risks considered by the Audit Committee.

Furthermore, the Chief Executive Officer’s membership on, and collaboration with, the Board allows our Chief Executive Officer to gauge whether management is providing adequate information for the Board to understand the interrelationships of our various business and financial risks. Our Chief Executive Officer is available to the Board to address any questions from other directors regarding executive management’s ability to identify and mitigate risks and weigh them against potential rewards.

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Board Oversight of Cybersecurity and Information Security Risk

Our Board appreciates the importance of maintaining the confidence and trust of our customers, suppliers, and employees. As part of the Board’s role as independent oversight of the key risks facing our Company, the Board, through the Audit Committee, devotes regular and thorough attention to our data, information technology (“IT”) systems and their development (including the Company’s e-commerce strategy and its implementation) and protection of our data and IT systems, including business resilience, compliance, cybersecurity, and information security risk.

On an ongoing basis, the Company analyzes and assesses information security risks associated with our business. The assessment is primarily the responsibility of the Company’s information technology department. The Company seeks to adhere to the NIST Cyber-Security Framework, which provides best practice guidance on how to prevent, detect, and respond to cyberattacks. As part of the Company’s information security risk management program, the Company routinely tests our controls and information systems to help ensure we remain compliant with our security policies and procedures and industry standards and requires that IT infrastructure associated with sensitive customer credit card information be audited and certified by a quality security party. We also provide information security training for our employees and business partners. In addition, the Company maintains information security risk insurance.

Management updates the Board on the Company’s information security policies and procedures, including, training, risk assessment, internal controls, security software, evaluation and testing, insurance, incident response plans, and forward-looking information security strategies. Additionally, our policies require our Board to be notified of breaches to our information systems based on pre-defined severity thresholds.

Board Oversight of Corporate Social Responsibility

Our Board, via the Nominating and Corporate Governance Committee, oversees our corporate social responsibility program and performance. The Nominating and Corporate Governance Committee receives quarterly updates on our opportunities and risk management efforts of sustainability and corporate social responsibility matters. Our Executive Leadership Team, including our Chief Executive Officer, reviews our corporate social responsibility strategy and is responsible for addressing such initiatives as part of our business and planning.

BOARD ORGANIZATION

Board Leadership Structure

We separate the roles of Chief Executive Officer and Chair of the Board. These positions are currently held by John C. Turner, Jr., as our Chief Executive Officer, and John J. Gavin, as the Chair of the Board. We believe this leadership structure is appropriate for our Company due to the differences between the two roles. The Chief Executive Officer is responsible for setting our strategic direction, providing day-to-day leadership, and managing our business, while the Chair of the Board provides guidance to the Chief Executive Officer, chairs board meetings and executive sessions of our independent directors, and takes a leading role in setting the agendas for meetings of our Board. In addition, separating the roles of Chief Executive Officer and Chair of the Board allows the Chair to provide oversight of our management.

Meetings of the Board and Committees

During the fiscal year ended April 30, 2023, the Board held six meetings. All of the directors who served during the fiscal year ended April 30, 2023 attended at least 75% of the total meetings of the Board and each of the Board committees on which such director served during their respective tenure. Directors are expected to make best efforts to attend all Board meetings, all meetings of the committee or committees of the Board of which they are a member and the annual meeting of stockholders. Attendance by telephone or videoconference is deemed attendance at a meeting.

Pursuant to our Corporate Governance Guidelines, our Board currently plans to hold at least four meetings each year, with additional meetings to occur (or action to be taken by unanimous consent, either in writing or by electronic transmission) at the discretion of the Board.

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Executive Sessions of Non-Management Directors

Pursuant to our Corporate Governance Guidelines, to ensure free and open discussion and communication among the non-management directors of the Board, the non-management directors meet in executive session at most Board meetings with no members of management present. The Chair of the Board presides at the executive sessions.

Committees of the Board

The Board has an Audit Committee, a Human Capital Management and Compensation Committee and a Nominating and Corporate Governance Committee, as described below. Currently, our Audit Committee, Human Capital Management and Compensation Committee and Nominating and Corporate Governance Committee consist entirely of independent directors. Each of the Audit Committee, Human Capital Management and Compensation Committee and Nominating and Corporate Governance Committee operates under a written charter approved by the Board, copies of which are available on our website at investor.gms.com/govdocs.

The following table shows the current membership of each committee of our Board and the number of meetings held by each committee during the fiscal year ended April 30, 2023:

Director

Audit
Committee

Human Capital Management and Compensation
Committee

Nominating and
Corporate
Governance
Committee

Lisa M. Bachmann

Peter C. Browning

John J. Gavin

Chair

Theron I. Gilliam

Mitchell B. Lewis

Teri P. McClure

Chair

Randolph W. Melville

J. David Smith

Chair

Number of Fiscal Year 2023 Meetings

Audit Committee

Currently, the members of the Audit Committee are Mr. John J. Gavin, as Chair, Ms. Lisa M. Bachmann, Mr. Mitchell B. Lewis, Mr. Randolph W. Melville, and Mr. J. David Smith. Each of Mr. Gavin, Mr. Lewis and Mr. Smith qualify as an “audit committee financial expert” within the meaning of regulations adopted by the SEC. The Audit Committee recommends the annual appointment of our independent registered accounting firm, oversees our cyber security and data privacy programs, and reviews the independence of auditors and reviews the scope of audit and non-audit assignments and related fees, the results of the annual audit, accounting principles used in financial reporting, internal auditing procedures, the adequacy of our internal control procedures, related party transactions, and investigations into matters related to audit functions. The Audit Committee is also partially responsible for overseeing risk management on behalf of our Board. See “—Board Oversight of Risk Management.” Our Audit Committee consists entirely of independent directors.

The charter of the Audit Committee permits the committee to, in its discretion, delegate its duties and responsibilities to one or more subcommittees as it deems appropriate.

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Human Capital Management and Compensation Committee

Currently, the members of the Human Capital Management and Compensation Committee are Mr. J. David Smith, as Chair, Mr. Peter C. Browning, Mr. Theron I. Gilliam, and Ms. Teri P. McClure. The principal responsibilities of the Human Capital Management and Compensation Committee are to review and approve matters involving executive and director compensation, recommend changes in employee benefit programs, authorize equity and other incentive arrangements, oversee our inclusion and diversity efforts, and authorize our Company to enter into employment and other related agreements with our executive officers. Our Human Capital Management and Compensation Committee consists entirely of independent directors.

The charter of the Human Capital Management and Compensation Committee permits the committee to, in its discretion, delegate its duties and responsibilities to a subcommittee of the Human Capital Management and Compensation Committee as it deems appropriate and to the extent permitted by applicable law.

In making executive compensation decisions during fiscal 2023, the Human Capital Management and Compensation Committee received advice from an independent compensation consultant, Meridian Compensation Partners, LLC (“Meridian”). Meridian's services during fiscal year 2023 are discussed in the Compensation Discussion and Analysis (“CD&A”) included below. Meridian did not provide any additional services to the Company other than those discussed in the CD&A.

Meridian conducted an annual review of its performance and prepared an annual independence document for the Human Capital Management and Compensation Committee that provided assurances and confirmation of the consultant’s independent status under the SEC’s and NYSE’s standards. The Human Capital Management and Compensation Committee then evaluated Meridian’s independence annually pursuant to the SEC’s rules and the NYSE’s rules. In making its determination, the Human Capital Management and Compensation Committee took into account, among other things, that no member of the Meridian team that works for the Human Capital Management and Compensation Committee has either a business or personal relationship with either any member of executive management or member of the Human Capital Management and Compensation Committee as defined by the NYSE’s rules.

Based on all considerations, the Human Capital Management and Compensation Committee concluded no conflict of interest existed in connection with the executive compensation services and considered Meridian to be independent.

Although Meridian is retained directly by the Human Capital Management and Compensation Committee, Meridian personnel interact with our executive officers as needed, specifically the Chief Executive Officer, Chief Financial Officer, Chief Human Resources Officer and General Counsel and their staffs to provide the Human Capital Management and Compensation Committee with relevant compensation and performance data for our executives and the Company.

Nominating and Corporate Governance Committee

Currently, the members of the Nominating and Corporate Governance Committee are Ms. Teri P. McClure, as Chair, Ms. Lisa M. Bachmann, Mr. Peter C. Browning, Mr. John J. Gavin, Mr. Theron I. Gilliam, Mr. Mitchell B. Lewis, Mr. Randolph W. Melville, and Mr. J. David Smith. The Nominating and Corporate Governance Committee assists our Board in identifying individuals qualified to become board members, makes recommendations for nominees for committees and develops, recommends to the Board and reviews our corporate governance principles. Our Nominating and Corporate Governance Committee consists entirely of independent directors.

The charter of the Nominating and Corporate Governance Committee permits the committee to, in its sole discretion, delegate its duties and responsibilities to one or more subcommittees as it deems appropriate.

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Succession Planning

The Board is responsible for the succession planning process for the directors, Chair of the Board, the Chief Executive Officer, and other executive officer positions. Succession planning for directors and key Company positions is a principal focus of the Nominating and Corporate Governance Committee as well as the full Board.

The Company has worked, using both internal and external resources, to integrate succession planning with leadership development in an effort to help ensure high-potential employees obtain the experience, skills and development opportunities necessary to assume, and succeed in, future leadership roles within the organization.

Human Capital Management and Compensation Committee Interlocks and Insider Participation

Mr. Smith, Mr. Browning, Mr. Gilliam, and Ms. McClure were members of the Human Capital Management and Compensation Committee during fiscal 2023, none of whom was an officer or employee of the Company at any time. None of our executive officers serves, or in the past year has served, as a member of the board of directors or compensation committee (or other committee performing equivalent functions) of any entity that has one or more executive officers serving on our Board or Human Capital Management and Compensation Committee. None of our executive officers served as a member of the compensation committee of an entity that has an executive officer serving as a director on the Board. No interlocking relationship exists between any member of our Human Capital Management and Compensation Committee (or other committee performing equivalent functions) and any executive, member of the board of directors or member of the compensation committee (or other committee performing equivalent functions) of any other company.

Hedging and Pledging Policy

The Company’s Securities Trading Policy prohibits all directors and executive officers of the Company from effecting short sales, put options, call options or other derivative securities, holding securities in a margin account or otherwise pledging securities as collateral for a loan or hedging or similar monetization transactions with respect to the Company’s common stock.

COMMUNICATIONS WITH THE BOARD

Any interested parties wishing to communicate with, or otherwise make his or her concerns known directly to the Board or chairperson of any of the Audit, Human Capital Management and Compensation and Nominating and Corporate Governance Committees, or to the non-management or independent directors as a group, may do so by addressing such communications or concerns to the General Counsel and Corporate Secretary of the Company, 100 Crescent Centre Parkway, Suite 800, Tucker, Georgia 30084. The General Counsel and Corporate Secretary will forward such communications to the appropriate party as soon as practicable. Such communications may be done confidentially or anonymously.

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DIRECTOR COMPENSATION

Director Compensation Program

The Human Capital Management and Compensation Committee is responsible for oversight of the compensation program for non-employee directors. The Committee annually reviews the program relative to peer and broader market practices with the assistance of Meridian, its independent compensation consultant. Non-employee directors receive a combination of cash and stock-based compensation designed to attract and retain qualified candidates to serve on the board and further align their interest with our stockholders. Our Chief Executive Officer does not receive any additional compensation for his service on the Board of Directors.

The following table presents the elements of compensation for non-employee directors under the Company’s director compensation program in fiscal 2023:


Element of Compensation	Amount
Non-executive chair cash retainer	$	100,000
Director cash retainer	100,000
Chair of Audit Committee cash retainer	25,000
Chair of Human Capital Management and Compensation Committee cash retainer	25,000
Chair of the Nominating and Corporate Governance Committee cash retainer	15,000
Member of the Audit Committee cash retainer	12,500
Member of the Human Capital Management and Compensation Committee cash retainer	10,000
Member of the Nominating and Corporate Governance Committee cash retainer	7,500
Director grant of restricted stock units	125,000

The annual cash retainers are paid in quarterly installments. The restricted stock units are valued on the date of grant. The restricted stock units vest on the one year anniversary of grant, subject to the director’s continued service on the Board on such vesting date, and upon vesting the director will receive shares of common stock, unless deferred as described below.

Deferred Compensation Plan for Non-Employee Directors

The Company has a deferred compensation plan for non-employee directors. Under the plan, non-employee directors may defer receipt of all or a portion of certain compensation. Compensation eligible for deferral includes annual retainer fees and committee fees, payable in cash and restricted stock units.

Fiscal 2023 Director Compensation Table

Shown below is information regarding the director compensation for each member of the Board for fiscal 2023, other than for Mr. Turner who does not participate in our director compensation program as an employee director.


Name	Fees Earned or Paid in Cash ($)		Stock Awards(1) ($)		Option Awards(2) ($)	Total ($)
Lisa M. Bachmann	$	112,500	$	125,000	$—	$	237,500
Peter C. Browning	113,750		125,000		—	238,750
John J. Gavin	225,000		125,000		—	350,000
Theron I. Gilliam	110,000		125,000		—	235,000
Mitchell B. Lewis	112,500		125,000		—	237,500
Teri P. McClure	113,750		125,000		—	238,750
Randolph W. Melville	112,500		125,000		—	237,500
J. David Smith	137,500		125,000		—	262,500

___________________________________

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(1)Represents the aggregate grant date fair value of the stock award, computed based on the number of awards granted and the fair value of the award on the date of grant. Assumptions used in the calculation of the grant date fair value of these award amounts are included in Note 12 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended April 30, 2023.

Pursuant to our director compensation program, on August 1, 2022, we granted restricted stock units valued at $125,000 to each independent director serving on our Board on that date. Each of the directors received 2,322 restricted stock units. The number of restricted stock units granted to each director was based on the closing price of GMS common stock on the grant date. The restricted stock units vest and become exercisable one year from the grant date.

(2)None of our directors were granted option awards in fiscal 2023. As of April 30, 2023, Mr. Gavin and Mr. Smith each had 30,474 options outstanding to purchase shares of Company common stock at an exercise price of $12.31 per share and Mr. Gilliam had 30,474 options outstanding to purchase shares of Company common stock at an exercise price of $14.77 per share. Such options were issued at the time the directors joined the Company’s Board. As of April 30, 2023, all outstanding options were vested.

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PROPOSAL 2—RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

The Audit Committee is directly responsible for the appointment, compensation, retention, evaluation, and oversight of the Company’s independent registered public accounting firm. As part of this responsibility, the Audit Committee routinely reviews the performance and retention of our independent registered public accounting firm.

The Audit Committee has appointed Ernst & Young LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ended April 30, 2024. We have engaged Ernst & Young LLP as our independent registered public accounting firm since August 2017. A representative of Ernst & Young LLP will be present at the Annual Meeting to answer questions of stockholders and will have the opportunity, if desired, to make a statement.

THE BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED ACCOUNTING FIRM FOR THE YEAR ENDING APRIL 30, 2024.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S FEES AND SERVICES

The following table presents the fees billed by Ernst & Young LLP, our independent auditors for the fiscal years ended April 30, 2023 and 2022:


Type of Fees	Fiscal Year Ended April 30, 2023		Fiscal Year Ended April 30, 2022
Audit Fees(1)	$	3,278,533	$	3,270,652
Audit-Related Fees(2)	85,000		475,000
Tax Fees(3)	—		—
All Other Fees(4)	—		—
Total	$	3,363,533	$	3,745,652

___________________________________

(1)Audit fees consist of fees for professional services rendered for the audit of our financial statements, review of interim financial statements, assistance with registration statements filed with the SEC and services that are normally provided in connection with statutory and regulatory filings or engagements.

(2)Audit-related fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under audit fees. Audit-related fees for fiscal 2023 include due diligence services provided in connection with business combinations.

(3)Tax fees are fees for a variety of permissible services relating to tax compliance, tax planning and tax advisory services.

(4)All other fees relate to professional services not included in the categories above.

The Audit Committee’s outside auditor independence policy provides for pre-approval of audit, audit-related and tax services specifically described by the Audit Committee on an annual basis and, in addition, individual engagements anticipated to exceed pre-established thresholds must be separately approved. The policy authorizes the Audit Committee to delegate to one or more of its members pre-approval authority with respect to permitted services.

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POLICY ON AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND NON-AUDIT RELATED

SERVICES OF INDEPENDENT AUDITORS

The Audit Committee is responsible for the appointment, compensation, retention, oversight, and termination of the Company’s independent registered public accounting firm. The Audit Committee has adopted a policy requiring substantially all audit, audit-related and non-audit services provided by the independent auditor be pre-approved by the Audit Committee. Pre-approval is not necessary for certain minor non-audit services that (i) do not constitute more than 5% of the total amount paid by the Company to its independent registered public accounting firm during the fiscal year the non-audit services were provided; (ii) were not recognized by the Company to be non-audit services at the time of the engagement for such services; and (iii) are promptly brought to the attention of the Audit Committee and approved prior to the completion of the audit by the Audit Committee or by one or more members of the Audit Committee who are members of the Board to whom authority to grant such approvals has been delegated by the Audit Committee. The Audit Committee may delegate authority to one or more independent members of the Audit Committee to grant pre-approvals of audit and permitted non-audit services, provided any such pre-approvals are presented to the full Audit Committee at its next scheduled meeting.

The Audit Committee has adopted a policy that prohibits our independent auditors from providing the following services:

• bookkeeping or other services related to the accounting records or financial statements of the Company;

• financial information systems design and implementation;

• appraisal or valuation services, providing fairness opinions or preparing contribution-in-kind reports;

• actuarial services;

• internal audit outsourcing services;

• management functions or human resources;

• broker or dealer, investment adviser or investment banking services;

• legal services and expert services unrelated to the audit; and

• any other service the Public Company Accounting Oversight Board prohibits through regulation.

The Audit Committee’s pre-approval policy is included in the Audit Committee Charter, which is available on our website at investor.gms.com/govdocs.

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REPORT OF THE AUDIT COMMITTEE OF THE BOARD

The Audit Committee is currently comprised of Mr. John J. Gavin, as Chair, Ms. Lisa M. Bachmann, Mr. Mitchell B. Lewis, Mr. Randolph W. Melville, and Mr. J. David Smith. The Audit Committee oversees GMS Inc.’s financial reporting process on behalf of the Board. Management has the primary responsibility for the financial statements and the reporting process, including maintaining an effective system of internal controls over financial reporting. The Audit Committee meets separately with management, the internal auditors and the independent registered public accounting firm. The Audit Committee operates under a written charter approved by the Board, a copy of which is available on our website at investor.gms.com/govdocs. The charter, among other things, provides the Audit Committee has full authority to appoint, compensate, retain, oversee, and terminate when appropriate, the independent registered public accounting firm.

In addition to fulfilling its oversight responsibilities as set forth in its charter and further described above in the section of this Proxy Statement entitled “Corporate Governance and Board Matters—Committees of the Board—Audit Committee,” the Audit Committee has done the following things:

•reviewed and discussed the audited financial statements in GMS Inc.’s annual report on Form 10-K for the fiscal year ended April 30, 2023 with management, including a discussion of the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments and the clarity of disclosures in the financial statements;

•reviewed with Ernst & Young LLP, GMS Inc.’s independent registered public accounting firm, who is responsible for expressing an opinion on the conformity of those audited financial statements with U.S. generally accepted accounting principles, their judgments as to the quality and acceptability of GMS Inc.’s accounting principles and such other matters as are required to be discussed with the Audit Committee under generally accepted auditing standards;

•received the written disclosures and the letter from Ernst & Young LLP required by applicable requirements of the Public Company Accounting Oversight Board (the “PCAOB”) regarding Ernst & Young LLP’s communications with the Audit Committee concerning independence;

•discussed with Ernst & Young LLP its independence from management and GMS Inc. and considered whether Ernst & Young LLP could also provide non-audit services without compromising the firm’s independence;

•discussed with Ernst & Young LLP the matters required to be discussed under Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 1301, Communications with Audit Committees (AS 1301); and

•discussed with the Company’s internal auditors and Ernst & Young LLP the overall scope and plans for their respective audits, and then met with the internal auditors and Ernst & Young LLP, with and without management present, to discuss the results of their examinations, their evaluations of GMS Inc.’s internal controls and the overall quality of GMS Inc.’s financial reporting.

Based on the foregoing reviews and discussions, the Audit Committee recommended to the Board that the audited financial statements be included in the annual report on Form 10-K for the fiscal year ended April 30, 2023, for filing with the SEC.

This report has been furnished by the members of the Audit Committee of the Board:


			Audit Committee

			John J. Gavin, Chair Lisa M. Bachmann Mitchell B. Lewis Randolph W. Melville J. David Smith

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MANAGEMENT

The following table sets forth, the name and age of each current executive officer of the Company, indicating all positions and offices with us currently held by such executive officer:

Name

Age

Position

John C. Turner, Jr.

President, Chief Executive Officer and Director

Scott M. Deakin

Senior Vice President and Chief Financial Officer

Craig D. Apolinsky

Senior Vice President, General Counsel and Corporate Secretary

Leigh R. Dobbs

Senior Vice President, Chief Human Resources Officer

George T. Hendren

Senior Vice President, Chief Operating Officer

Set forth below are descriptions of the backgrounds of each current executive officer of the Company who are not directors. The background for John C. Turner, Jr., who is also a director, is provided in the section entitled “Proposal 1—Election of Directors” of this Proxy Statement.

Scott M. Deakin, our Senior Vice President and Chief Financial Officer, joined us in 2019. Prior to joining us, Mr. Deakin served as the President of the Thermal Acoustical Solutions segment of Lydall, Inc., a publicly-traded global manufacturer of specialty engineered products from 2017 to 2019. Prior to that, he served as Executive Vice President and CFO of Lydall, Inc. where he oversaw its finance and accounting organization from 2015 to 2018. Mr. Deakin previously served as Executive Vice President, Chief Financial Officer of Ensign-Bickford Industries, Inc. from 2009 to 2015. Earlier in his career he also held the role of Senior Vice President, Corporate Development at Barnes Group, Inc. from 2007 to 2009 and various operating and finance roles during his 12 years at Eaton Corporation. He began his career at Deloitte and PricewaterhouseCoopers, LLP. Mr. Deakin holds an MBA from Carnegie Mellon University and a Bachelor of Science in Business Administration from Bowling Green State University.

Craig D. Apolinsky, our Senior Vice President, General Counsel and Corporate Secretary, joined us in July 2015. Prior to joining us, Mr. Apolinsky was a corporate and mergers and acquisitions attorney with the law firm of Taylor English Duma LLP from December 2014 until July 2015. From September 2008 until May 2014, Mr. Apolinsky served as Executive Vice President, General Counsel and Corporate Secretary for Alere Health, LLC, a healthcare services company. Previously he served as Senior Vice President, General Counsel and Corporate Secretary for Merge Healthcare Incorporated from April 2007 until August 2008. From 2005 until 2007 he worked for Gold Kist Inc., including as its Deputy General Counsel and Assistant Secretary. Prior to joining Gold Kist in 2007, Mr. Apolinsky was a partner at Alston & Bird LLP, where he practiced in the areas of corporate, securities and mergers and acquisitions for eleven years. Mr. Apolinsky received his law degree from the University of Texas at Austin School of Law and his undergraduate degree from the University of Virginia.

Leigh R. Dobbs, our Senior Vice President, Chief Human Resources Officer, joined us in September 2022. Prior to joining GMS, Ms. Dobbs served as Executive Vice President and Chief Human Resources Officer for Zenith American Solutions, Inc. Also, from 2013 to 2020, Ms. Dobbs worked in progressive leadership positions within Human Resources for Randstad North America, and from 2009 to 2013, she served as Director, Compensation and Benefits for building products distributor, BlueLinx Corporation. Ms. Dobbs earned a Bachelor of Science in Industrial Engineering from Georgia Tech and a Master of Business Administration from Emory University’s Goizueta Business School.

George T. Hendren, our Senior Vice President, Chief Operating Officer, joined us in 2014 and was appointed as the Company's Chief Operating Officer effective August 1, 2022. Mr. Hendren served as President, GMS Canada from 2019 to August 2022. From 2014 to 2019, Mr. Hendren served as Vice President of Corporate Development for the Company. Prior to joining us, Mr. Hendren spent seventeen years in the financial services industry in various roles. From 2008 to 2014, Mr. Hendren was a Managing Director with Algon Group, where he worked as a financial consultant to the building materials and homebuilding industries. Previously, Mr. Hendren worked for Wachovia Securities and predecessors as an investment banker, most recently as a Director, focused on building materials manufacturers and distributors. Mr. Hendren received a Bachelor of Science of Business Administration degree with distinction from the University of North Carolina.

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PROPOSAL 3—ADVISORY VOTE ON EXECUTIVE COMPENSATION

The Board is providing the Company’s stockholders with the opportunity to cast an advisory vote on our executive compensation program, in accordance with Section 14A of the Exchange Act. This proposal is commonly known as a “say on pay” proposal.

The section of this Proxy Statement entitled “Compensation Discussion and Analysis” describes the Company’s executive compensation program that is designed to provide opportunities for our named executive officers to earn incentive compensation based on the achievement of company performance goals balanced with compensation elements intended to retain our management talent over the long-term. We believe we utilize an appropriate mix of fixed and variable compensation elements, including salary, short-term cash bonus opportunities and long-term incentives in the form of equity-based compensation, to retain and motivate our named executive officers. We encourage you to review the section of this Proxy Statement entitled “Compensation Discussion and Analysis” for additional details.

Under our Bylaws, the below resolution will be approved if the votes cast “FOR” its approval exceed the votes cast “AGAINST” its approval. Abstentions and non-votes by brokers, banks and other nominee holders of record will not be counted as votes for or against the below resolution.

The Board recommends that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers as follows:

RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including in the Compensation Discussion and Analysis, the compensation tables and narrative discussion, is hereby approved.

As an advisory vote, this proposal is not binding on the Company. However, the Human Capital Management and Compensation Committee and the Board value the opinions expressed by the Company’s stockholders on this issue and will consider the outcome of this vote when making future compensation decisions for the named executive officers.

THE BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” PROPOSAL 3 TO APPROVE, ON AN ADVISORY BASIS, THE COMPENSATION PAID TO OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED PURSUANT TO THE SEC’S COMPENSATION DISCLOSURE RULES.

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PROPOSAL 4—ADVISORY VOTE ON THE FREQUENCY OF ADVISORY VOTES ON EXECUTIVE COMPENSATION

In accordance with Section 14A of the Exchange Act, we are required to ask our stockholders to vote on whether future advisory "say on pay" votes on the compensation of our named executive officers, such as Proposal 3 of this Proxy Statement, should occur every 1 Year, 2 Years or 3 Years. This Proposal 4 asks stockholders to submit their "say on pay" frequency preference (meaning every one, two or three years), or stockholders may abstain from voting on the proposal. The Company requests that the stockholders vote, on an advisory basis, to hold a stockholder advisory vote on executive compensation (a "say on pay" vote) every 1 Year.

The Board believes that holding an advisory "say on pay" vote every year will allow stockholders to provide direct input on the effectiveness of our overall compensation philosophy, policies and practices in the context of our long-term business results. An advisory "say on pay" vote every one year will provide the most effective timeframe for the Company to respond to vote results and stockholder feedback.

As an advisory vote, this proposal is not binding upon the Company. However, our Board values the opinions expressed by stockholders in their vote on this proposal and will carefully consider the outcome of the vote.

THE BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE TO HOLD AN ADVISORY VOTE ON EXECUTIVE COMPENSATION EVERY YEAR, BY THE SELECTION OF "1 YEAR" FOR PROPOSAL 4.

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EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

The discussion that follows describes the executive compensation program for our named executive officers (“NEOs”). This Compensation Discussion and Analysis (“CD&A”) is intended to be read in conjunction with the tables immediately following this section, which provide further historical compensation information.

The following executive officers constituted our NEOs for fiscal year 2023:


Name			Title
John C. Turner, Jr.			President and Chief Executive Officer
Scott M. Deakin			Senior Vice President and Chief Financial Officer
Craig D. Apolinsky			Senior Vice President, General Counsel and Corporate Secretary
Leigh R. Dobbs			Senior Vice President, Chief Human Resources Officer
George T. Hendren			Senior Vice President, Chief Operating Officer

I. Overview

Our compensation program is designed to reward executives for achievement of the Company’s short- and long-term performance goals. Our Company’s performance is highly dependent on the talents, skills and engagement of our people. As such, our executive compensation program is designed to: (1) attract highly qualified individuals; (2) retain those individuals in a competitive marketplace for executive talent; and (3) motivate performance in a manner that supports achievement of our mission to increase stockholder value while ensuring these programs do not encourage excessive risk-taking.

We believe our executive compensation program as developed and implemented, and as presented in this CD&A, achieves these objectives and is appropriate for a company in our industry and at our stage of growth.

2023 Performance

In fiscal 2023, GMS continued to execute our growth strategy. During fiscal 2023, we increased net sales to $5.3 billion, primarily due to inflationary pricing along with strength in multi-family residential construction activity and an improving commercial landscape, each of which helped drive volume growth in wallboard and complementary products. We also benefited from acquisitions completed over the past year. We believe this growth has well-positioned the Company to continue delivering strong results to our stockholders in future years.

Highlights of our fiscal 2023 performance include the following:

• Generated net sales of $5,329.3 million, a 15.0% increase from the prior fiscal year. Organic net sales increased 12.7% from the prior fiscal year.

• Generated net income of $333.0 million, or $7.82 per diluted share, compared to $273.4 million, or $6.23 per diluted share, in the prior fiscal year. Net income as a percentage of sales was 6.2% and 5.9% during fiscal 2023 and 2022, respectively.

• Generated Adjusted EBITDA(1) of $665.7 million, or 12.5% of net sales, compared to Adjusted EBITDA of $566.9 million, or 12.2% of net sales, in the prior fiscal year.

• Completed four acquisitions, including Construction Supply of Southwest Florida, Inc., a distributor of various stucco, building and waterproofing supplies serving markets in the southwest Florida area; Tanner Bolt and Nut, Inc., a distributor of various tools, fasteners, sealants, and related construction products to the broader New York City market; Blair Building Materials, Inc., a distributor of exterior, insulation, and waterproofing products to customers in the Greater Toronto Area; and Engler, Meier and Justus, Inc., a leading distributor of drywall, acoustical ceilings and related interior construction products to the greater Chicago market and exterior insulation finishing systems (“EIFS”) related products in the Southeastern United States.

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• Opened six new branch locations and eleven new Ames tool sales, rental and service centers.

• Generated cash provided by operating activities of $441.7 million.

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(1) Adjusted EBITDA is a non-GAAP measure management uses to evaluate the performance of the Company. Adjusted EBITDA, as we define it, is an amount equal to net income (loss) plus interest expense and related items, income taxes, stock compensation, depreciation and amortization, further adjusted to exclude other non-cash items and certain other adjustments. See Appendix A for a reconciliation of Adjusted EBITDA to the most comparable measure reported in accordance with GAAP.

Pay Program Overview

We believe the design and structure of our pay program, and in particular our incentive plans, support our business strategy and organizational objectives while successfully aligning executive focus and interest with our stockholders. Our compensation programs are designed to attract, motivate, and retain qualified and talented executives, and to incent our executives to achieve our business goals and reward them for superior short- and long-term performance. All pay elements, and the safeguards and governance features of the program, have been carefully chosen and implemented to align with our pay philosophy and objectives.

In doing so, we have selected the following framework to achieve these objectives:


Base Salary			Fixed cash component of pay based on individual scope of experience and responsibilities, performance against goals, and peer and industry practices.

Annual Incentives			Variable cash component of pay intended to motivate and reward our executives for the achievement of select strategic goals of the Company.
			In fiscal year 2023, our annual incentives continued to be based on two corporate performance metrics: (1) Adjusted EBITDA (weighted 80%) and (2) Working Capital Turns (weighted 20%).

Long-Term Equity Incentives			Variable stock-based component of pay designed to motivate executives to deliver long-term stockholder value, while also providing a retention vehicle for our executive talent. In fiscal year 2023, equity awards were granted with a three-year annual vesting term as:
			• Stock Options (50%)
			• Restricted Stock Units (“RSUs”) (50%)

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2023 Target Pay Mix

Consistent with our philosophy of aligning executive pay with the short- and long-term performance of the Company, and to align the interests of management with those of our stockholders, the Company’s compensation programs are designed to provide a significant portion of executive compensation in the form of variable, at-risk, incentive pay as shown in the graphics below:

Compensation Governance Highlights

The Human Capital Management and Compensation Committee (“HCMC Committee”) regularly reviews best practices in executive compensation and uses the guidelines below to design our compensation programs.

SEC Form DEF 14A filed by GMS Inc.