Hello, welcome to the Gentherm Incorporated 2026 Annual Meeting of Shareholders. The Q&A will be open until the close of formal business. Questions should be limited to only those relevant to the proposal. Shareholders should limit their numbers of questions to two. You may submit your questions or comment by clicking on the Q&A section of the virtual meeting site. It is now my pleasure to turn today's meeting over to Ron Hundzinski, Chair of Board. Mr. Hundzinski, the floor is yours.
Good morning. The 2026 Annual Meeting of Shareholders of Gentherm Incorporated is hereby called to order. My name is Ron Hundzinski, and I am the Chair of the Board and a candidate for election as a director. It is my pleasure to welcome you to Gentherm's 2026 Annual Meeting. I would now like to introduce Bill Presley, President and CEO. Bill, you begin the formal portion of the meeting.
Thank you, Ron, and good morning, everyone. It is my pleasure to welcome all of you to our virtual annual meeting being held live as an audio webcast. The agenda and rules of conduct for this meeting, as well as the certified list of shareholders entitled to vote at this meeting, are available for you to access on the virtual meeting website. I am pleased to introduce the members of the board who are nominees for re-election at this meeting present telephonically today. Sophie Desormière, David Heinzmann, Ron Hundzinski, who already introduced himself, Laura Kowalchik, Chuck Kummeth, Betsy Meter, John Stacey, Ken Washington, and myself. Our Board is comprised of highly qualified and experienced leaders who are actively engaged in Gentherm's mission in delivering long-term shareholder value. It is my pleasure to work with each of them.
Also with us today are a number of our executive officers, including Jonathan Douyard, Executive Vice President, Chief Financial Officer, and Treasurer, and Wayne Kauffman, Senior Vice President, General Counsel, and Secretary, and representatives of the company's independent auditor, Ernst & Young. At this meeting, you'll be asked to, one, elect the nine directors named in the proxy statement, each to serve for a one-year term until the 2027 Annual Meeting and until a successor has been duly elected and qualified or until such director's early resignation, retirement, or other termination of service. Two, approve on an advisory basis the compensation of our named executive officers. Three, ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31st, 2026. Four, approve the amendment to the Gentherm Incorporated 2023 Equity Incentive Plan.
The board recommends that you vote for each nominee for director and for proposals two, three, and four. I would now like to introduce Wayne Kauffman, Senior Vice President, General Counsel and Secretary. He will act as secretary of the meeting. He has in his possession the following company documents: the certified list of shareholders entitled to vote at this meeting and the notice of the meeting, forms of proxy statement, and other proxy materials, together with an affidavit of mailing by Broadridge of the notice of internet availability or other proxy material to each person who is a record holder of common stock as of the close of business on March 17th, 2026, the record date of this annual meeting. The materials, together with the affidavit of mailing, will be filed in the corporate records.
Pursuant to the company's bylaws, Janice W. Castillo, a representative of Broadridge, has been appointed Inspector of Election to supervise the voting, and Janice has signed an oath of office, which will be filed in the corporate records. Wayne will continue with the formal portion of our meeting.
Thank you, Bill, and good morning, everyone. A quorum is deemed to be present for this meeting. We are now prepared to proceed with the meeting. The time is now 8:34 A.M., and the polls for all proposals are now open. If you previously voted via the Internet, phone, or mail, you do not need to take any additional action. Any shareholder who has logged in using your 16-digit control number and wants to vote during this meeting or previously voted and wants to change a vote may do so now by using the voting button on the virtual meeting site before the closing of the polls. The polls will close after the presentation of the last agenda item in the notice of meeting the approval of the amendment to the Gentherm Incorporated 2023 Equity Incentive Plan.
If you have a question about one of these matters in the agenda to be voted on by the shareholders at this meeting, please submit your question in the Q&A section on the virtual meeting site at or before the time the relevant matter is before the meeting for consideration. We will answer questions on the matters in the agenda to be voted on by the shareholders at this meeting if received before the voting is closed. After the polls close, Bill will give a brief business update while the Inspector of Election tabulates the votes, following which we will announce the preliminary results of today's meeting. Holders of record of common stock at the close of business on March 17th, 2026, the record date for this annual meeting, are entitled to cast 1 vote per share for each matter. There is no cumulative voting.
Directors are elected by a plurality of votes cast at this meeting or by proxy. Notwithstanding the plurality vote required, Gentherm's voting policy includes additional procedures for directors who do not receive a majority of votes cast that has the effect of a majority voting policy. All other matters require the approval of the majority of votes cast. You can read about more information about each of these proposals in the company's proxy statement. The first order of business is the election of nine directors as named in the company's proxy statement to the Board of Directors for a one-year term. Each of the nine directors elected today will serve until the 2027 Annual Meeting of Shareholders and until a successor has been duly elected and qualified, or until such director's earlier resignation, retirement, or other termination of service.
The Board of Directors has nominated nine directors for election: Sophie Desormière, David Heinzmann, Ron Hundzinski, Laura Kowalchik, Charles Kummeth, Betsy Meter, Bill Presley, John Stacey, and Ken Washington. In re-nominating these nine individuals, the Board and the Nominating and Corporate Governance Committee chose directors that the board believes have an appropriate balance of qualifications, skills, and experience as a group to ensure that the board appropriately fulfills its oversight responsibilities and acts in the best interests of shareholders and the company. The next order of business is the approval of the advisory vote on named executive officer compensation pursuant to the following resolution.
Resolved that the company shareholders approve on an advisory basis the compensation of the named executive officers as disclosed in the company's proxy statement for the 2026 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation discussion and analysis, the summary compensation table, and other related tables and disclosure. The next order of business is the ratification of the Audit Committee's appointment of Ernst & Young LLP as the company's independent registered public accounting firm for the year ending December 31st, 2026. Mike Boehm, Partner at Ernst & Young, is present at this meeting and available to respond to appropriate questions of shareholders. The next order of business is the approval of the proposed amendment to Gentherm's 2023 Equity Incentive Plan.
The amendment increases by 1,700,000 shares the maximum number of shares of common stock that may be issued pursuant to awards granted under such plan. You can read about this proposal and our compensation program in the company's proxy statement. We'll now pause to see if there's any questions on the proposals. Okay. As there are no questions or comments received on the proposals, I hereby declare at 8:38 A.M., polls for each proposal are now closed. I will report the preliminary results of the voting later in the meeting after tabulation has been completed by the Inspector of Election. While the inspector is tabulating the votes, I would like to turn the meeting back to Bill to provide a few remarks.
Before Bill's statements, I want to remind participants that we may make forward-looking statements within the meaning of the federal securities laws during this meeting. Statements reflect our current views with respect to future events and financial performance. We undertake no obligation to update them. Actual results may differ materially. For discussions of our risk factors and other risks and uncertainties underlying such forward-looking statements, as well as more information on the company's historical performance and expectations for 2026, please see our SEC filings, including our 2025 Annual Report on Form 10-K, our first quarter 2026 report on Form 10-Q, and associated earnings release. If we discuss non-GAAP financial measures as defined by SEC Regulation G, reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are included in our most recent earnings release or investor presentations available on our website.
Thank you, Wayne. While we wait preliminary voting results, I would like to provide a business update of our company performance for 2025 and a few thoughts for the year ahead. During 2025, we made significant progress on our long-term strategic initiatives while executing against our financial and operational priorities. The team secured more than $2 billion of automotive new business awards for the third consecutive year. We achieved record annual revenue of $1.5 billion during 2025, with strong outperformance versus market led by lumbar and massage comfort solutions, and delivered adjusted EBITDA of $175 million while executing footprint consolidation initiatives in three regions across the globe. These actions are expected to be substantially completed later this year and will be a key contributor to margin expansion going forward.
We focused on cash conversion and delivered operating cash flow of $117 million, which allowed us to further strengthen our balance sheet and end the year with net leverage of 0.2 turns. The year reinforced my confidence in the strength of our business and our path to improved financial performance. Our belief that Gentherm can grow its revenues at mid-single digit growth over market has only strengthened. On margins, we are investing in footprint optimization, we are launching lumbar and massage comfort solutions that improve margins, and we will be able to leverage scale as growth accelerates. Our roadmap to delivering improved financial performance is clear.
When I took this role, I had a strong belief that Gentherm was at an inflection point to enter its next phase of growth by scaling its core technologies beyond its existing applications. We have proven that ability in a short period of time. We purposefully broke out our technologies into four platforms to clearly identify attractive markets outside of light vehicle where our products are applicable, which was the catalyst for reshaping our M&A funnel. During 2025, we quickly expanded into commercial vehicles, powersports, and home and office. We will build on this momentum and continue scaling our existing products and technologies with new markets, new applications in nontraditional customers to deliver strategic profitable growth. In January, we took a major step in transforming Gentherm by announcing our agreement to combine with Modine Performance Technologies, creating a market leader in thermal and precision flow management.
This transaction accelerates our strategy and transforms the company with an expanded product portfolio and broader end- market exposure with an attractive financial profile. We are off to a strong start in 2026. Our team is invigorated and operating with a clear focus on strategic priorities. Our actions over the last year have formed a new foundation in our pursuit of building a more resilient company. We are at the beginning stages of transforming Gentherm, repositioning the company for growth by taking our technologies outside of light vehicle markets. We are taking decisive actions to position Gentherm for sustainable, profitable growth and long-term value creation. I will now turn the meeting back to Wayne to provide the preliminary voting results.
All right. Thank you, Bill. The votes have been counted, and the preliminary report of the Inspector of Election has been provided to me. The inspection has certified that each of the nine director nominees has been reelected as a director of the company. In addition, the advisory vote on named executive officer compensation has been approved. The Audit Committee's appointment of Ernst & Young as the company's independent registered public accounting firm for 2026 has been ratified, and the amendment to the Gentherm Incorporated 2023 Equity Incentive Plan has been approved. The report and certificate of the Inspector of Election will be filed with the minutes of this meeting. We intend to disclose the final vote tallies in an 8-K filing with the SEC within four business days.
You have now heard the preliminary results of the voting, and this completes the formal business to be conducted at this meeting. I declare the formal business portion of this annual meeting adjourned.
Thank you, Wayne. Our program for the 2026 annual meeting is now concluded. Thank you for attending. We look forward to seeing you at next year's annual meeting.
Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Thank you.