Form 4: AAR Corp Executive Acquires Performance-Based Stock, Transfers Significant Holdings

AAR Corp's Senior VP, GC, CAO & Secretary, Jessica A. Garascia, acquired 4,816 shares of restricted stock due to exceeding performance targets and transferred a substantial portion of her beneficial ownership, including common stock, restricted stock, and options, in an exempt transaction.

Summary

• Jessica A. Garascia, Senior VP, GC, CAO & Secretary of AAR CORP, acquired 4,816 shares of common stock on July 15, 2025.
• This acquisition represents additional restricted stock awarded because performance criteria were exceeded, specifically at a level above the target.
• The initial target award for this restricted stock was previously reported on a Form 4 filed on July 20, 2022.
• Garascia also transferred the economic interest in 4,787 shares of AIR common stock, 5,556 shares of performance-based restricted stock, 1,381 shares of time-based restricted stock, and employee stock options (1,559 from July 12, 2021; 1,972 from July 18, 2022; and 1,481 from July 24, 2023).
• This transfer was exempt from Section 16 reporting requirements under Rule 16a-12 of the Securities Exchange Act of 1934, and Garascia no longer reports these transferred securities as beneficially owned.
• Following these transactions, Garascia's beneficial ownership stands at 30,657 shares of common stock.

Sentiment

Score: 7

Explanation: The acquisition of restricted stock due to exceeding performance targets is a positive indicator of company performance. The transfer of other securities is an exempt transaction, likely for personal financial planning, and does not inherently reflect negatively on the company's prospects.

Positives

• Acquisition of 4,816 shares of restricted stock indicates strong company performance, as the award was granted for exceeding performance criteria at a level above the target.

Negatives

• The transfer of a significant number of shares (4,787 common, 5,556 performance-based restricted, 1,381 time-based restricted) and options (totaling 5,012 options) reduces the direct beneficial ownership of a key executive, which could be perceived negatively by some investors if not understood as an estate planning or similar exempt transaction.

Future Outlook

No specific future outlook or guidance is provided in this filing, which primarily reports past insider transactions.

Management Comments

• Represents additional restricted stock acquired upon certification of performance criteria (at a level exceeding the target level) pursuant to a Restricted Stock Agreement.
• Since the date of the reporting person's last ownership report, the reporting person transferred the economic interest in 4,787 shares of AIR common stock, 5,556 shares of performance-based restricted stock, 1,381 shares of time-based restricted stock and certain employee stock options... in a transaction exempt from Section 16 pursuant to Rule 16a-12 under the Securities Exchange Act of 1934. The reporting person no longer reports as beneficially owned any of these securities.

Industry Context

This Form 4 filing details routine insider transactions for an executive at AAR CORP, a company operating in the aerospace and defense industry. The acquisition of performance-based restricted stock is a common incentive mechanism in this sector, aligning executive interests with company performance. The transfer of shares and options, likely for estate planning purposes under Rule 16a-12, is also a standard practice for high-net-worth individuals.

Comparison to Industry Standards

• The grant of restricted stock for exceeding performance criteria is a standard practice in executive compensation across the aerospace and defense industry, similar to programs at companies like Boeing or Lockheed Martin, which tie executive incentives to specific operational or financial targets.
• The use of Rule 16a-12 for transferring beneficial ownership, typically for estate planning, is a common and accepted method for executives to manage their personal holdings while remaining compliant with SEC regulations, mirroring practices seen at executives in other large public companies.

Corporate Governance

Related Party Transactions

• The transfer of economic interest in shares and options to an unspecified entity, exempt under Rule 16a-12, is a transaction between the reporting person and a related party (e.g., a family trust or similar entity) for personal financial planning purposes.

Stakeholder Impact

• Shareholders: The acquisition of performance-based restricted stock suggests that executive incentives are aligned with achieving and exceeding company performance targets, which could be viewed positively. The transfer of shares, while reducing direct beneficial ownership, is an exempt transaction and typically does not imply a lack of confidence.
• Employees: No direct impact on employees is indicated, though strong company performance (implied by the performance-based award) generally benefits all employees.

Next Steps

• No specific future actions or milestones are mentioned in this Form 4 filing, which reports completed transactions.

Key Dates

Recommendation

Keywords

AAR CORP, AIR, SEC Form 4, insider trading, beneficial ownership, restricted stock, stock options, executive compensation, Jessica A. Garascia, performance criteria, stock transfer, Rule 16a-12