POOL CORP

Compensation Setting Process

Our Compensation Committee is responsible for the oversight of our executive compensation. The Compensation Committee approves compensation plans for senior management and equity-based plans for all employees. In its evaluation and determination of executive compensation, the Compensation Committee considers many factors, including the Company’s overall performance; each individual executive’s role and responsibilities, performance, tenure and experience; and peer group performance.

The Compensation Committee normally meets in February of each year to set executive compensation plans for that fiscal year.

Role of Management

The Compensation Committee relies on data and analysis, as well as recommendations from our CEO. While the CEO provides recommendations with respect to potential senior management compensation and the Compensation Committee reviews such recommendations, the Compensation Committee ultimately uses its collective judgment to determine senior management compensation. The CEO does not provide recommendations for his own compensation, which the Compensation Committee independently determines and approves. Although the CEO attends Compensation Committee meetings at which executive compensation matters are considered, he is not present when the Compensation Committee deliberates or votes on his compensation. Our Company’s management also assists the Compensation Committee with developing the peer group analysis each year.

Role of Compensation Consultant

Our Compensation Committee periodically retains an independent compensation consultant to review and comment on executive and director compensation. In an effort to continue to ensure that our executive compensation program properly aligns with the interests of our stockholders and remains competitive in the market, the Compensation Committee engaged Pearl Meyer & Partners, LLC (Pearl Meyer) in the fall of 2022 to review our executive and non-employee director compensation programs as well as our peer group composition.

While they report directly to the Compensation Committee, the independent compensation consultant may interact with management when appropriate and necessary in order to obtain relevant executive compensation and company performance data. They may also seek input and feedback from management regarding their work product and analysis prior to presenting such information to the Compensation Committee in order to confirm their understanding of the company’s processes or to identify data questions or other issues, if any.

Benchmarking and Establishment of Peer Group

Our compensation programs are designed to be competitive with companies of comparable size and industry with whom we compete for executive talent. As noted above, we believe that total target compensation for our NEOs should be closely aligned to the median total compensation of our peer group. We establish compensation targets for each executive position in the aggregate and by component based on a design that we believe will best achieve our strategic and financial objectives. The Compensation Committee compares our primary compensation components – base salary, annual cash incentives, and long-term incentive awards – individually and in the aggregate to the compensation of the most highly compensated executive officers of our “peer group” companies (the peer group is sometimes referred to as the “market”). These comparisons, which are based on compensation information published in the annual proxy statements of the peer group companies, provide the Compensation Committee with insight into executive pay and benefits at companies in similar market environments.

The Compensation Committee reviews management’s evaluation of potential peer companies, approves the annual peer group and also reviews the annual executive compensation analysis that is prepared by management and, in some years, by the compensation consultant. In developing our peer group, we evaluate the following criteria:

▪organizational structure (public companies);

▪type of business (primarily wholesale distribution);

▪company size (based on revenue and market capitalization); and

▪peer group size (number of peer companies).

In performing our evaluation, we focus on public companies that we believe would provide a comparable cross-industry subset of distributors. While we evaluate companies that may have some manufacturing or retail operations, we generally exclude companies from consideration if the majority of the business is not wholesale distribution.

The Compensation Committee reviewed our 2022 peer group and added LKQ Corporation, a distribution company with revenue and market capitalization within our criteria ranges. No other changes were made to the peer group used in 2022. Accordingly, our 2023 peer group consisted of the following 14 companies:

The table below presents our revenue and market capitalization compared to the median of our 2023 peer group (based on data available in the fall of 2022 when the 2023 peer group was established) as provided by FactSet.

(1)POOL’s revenue reflects net sales for our most recent four quarters at the time of our analysis on October 10, 2022, and our market capitalization is as of October 10, 2022.

(2)The peer group median revenue represents the median net sales for the most recent four quarters available as of October 10, 2022; the peer group median market capitalization is as of October 10, 2022.

The Compensation Committee reviews each component of our NEOs’ compensation compared to the peer group. However, the Compensation Committee ultimately focuses on whether total compensation by design aligns closely with the peer group median total compensation. While we compare our CEO position to the CEO positions for our peer group, we compare our other NEOs to the peer group in the aggregate as opposed to by position because we believe it affords a better comparison overall as the positions and responsibilities for this group vary from company to company.

Market medians and the ranges around them represent only beginning reference points. The Compensation Committee also uses its subjective judgment to set compensation targets, incorporating other relevant information such as individual executive performance and skills, long-term potential, experience in the position, retention considerations and internal equity among executives. The Compensation Committee also reviews the total annual compensation that each executive could potentially receive and, for perspective, reviews the previous year’s total compensation for each executive.

The Compensation Committee has considered the impact that paying below the median of our peers might have on attracting, retaining and motivating senior management. The Compensation Committee believes that the fundamental philosophy of emphasizing pay-for-performance is the right one for our Company, and that our core compensation program can provide competitive or superior total compensation for senior management compared to our peer group given a reasonable economic environment. The Compensation Committee continues to believe that the design of our compensation program reflects a greater weighting of performance-based and at-risk compensation than the peer group median. Provided that our performance meets or exceeds expectations in future years, the Compensation Committee expects our NEOs will realize total compensation comparable or superior to the peer group median over time.