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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

Filed by the Registrant  x                             Filed by a Party other than the Registrant  ¨

Check the appropriate box:

Engility Holdings, Inc.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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ENGILITY HOLDINGS, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON MAY 26, 2016

Dear Fellow Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders (the “Annual Meeting”) of Engility Holdings, Inc. (the “Company”), which will be held on Thursday, May 26, 2016 at 9:00 a.m. eastern daylight time at the Ritz Carlton Tysons Corner, 1700 Tysons Blvd, McLean, Virginia 22102.

We are holding the Annual Meeting for the following purposes:

These matters are more fully described in the accompanying proxy statement. We are not aware of any other business to be transacted at the Annual Meeting.

Only stockholders of record on our books at the close of business on Thursday, March 31, 2016 will be entitled to vote at the Annual Meeting and any adjournments or postponements of the Annual Meeting.

We are furnishing proxy materials to our stockholders over the Internet. On or about April 12, 2016, we mailed to all stockholders of record as of the close of business on Thursday, March 31, 2016 a notice containing instructions on how to access our Annual Report to Stockholders, which contains our audited consolidated financial statements for the fiscal year ended December 31, 2015, and our proxy statement and proxy card on the Internet website indicated in our notice. The April 12, 2016 notice also provides instructions on how you can request a paper copy of our proxy materials and Annual Report to Stockholders.

For questions on accessing proxy materials or voting, please call 1 (800) 579-1639.

April 12, 2016

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YOUR VOTE IS IMPORTANT. STOCKHOLDERS MAY VOTE IN PERSON AT THE ANNUAL MEETING OR BY INTERNET, TELEPHONE OR MAIL. PLEASE REFER TO YOUR PROXY CARD, BROKER INSTRUCTIONS OR THE NOTICE OF PROXY AVAILABILITY DISTRIBUTED TO YOU ON APRIL 12, 2016 FOR INFORMATION ON HOW TO VOTE IN PERSON OR BY INTERNET, TELEPHONE OR MAIL.

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ENGILITY HOLDINGS, INC.

PROXY STATEMENT

FOR THE ANNUAL MEETING OF

STOCKHOLDERS

TO BE HELD ON MAY 26, 2016

This proxy statement is being furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Engility Holdings, Inc. for use at the Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Thursday, May 26, 2016 at 9:00 a.m. eastern daylight time at the Ritz Carlton Tysons Corner, 1700 Tysons Blvd, McLean, Virginia 22102, and any adjournments or postponements of the Annual Meeting. The Board is soliciting proxies for the purposes set forth in the accompanying Notice of Annual Meeting of Stockholders. This proxy statement and the accompanying proxy card are being distributed and made available on or about April 12, 2016 to all stockholders of record as of the close of business on March 31, 2016.

INTRODUCTION

On February 26, 2015, we completed the acquisition of TASC, Inc. (“TASC”), a leading professional services provider to the national security and public safety markets, in an all-stock transaction valued at approximately $1.3 billion, including the assumption of net debt of approximately $614 million. The combined companies now operate under a new holding company, New East Holdings, Inc., which was renamed “Engility Holdings, Inc.” upon the closing of the acquisition, and continues to trade on the New York Stock Exchange (“NYSE”) under the symbol “EGL”. As a result of the acquisition of TASC, certain former TASC stockholders, through Birch Partners, LP, now hold approximately 51.1% of our shares of common stock outstanding as of March 31, 2016, subject to the terms of a Stockholders Agreement described under Proposal 1 below.

This is the second proxy statement we have filed for the combined company following the acquisition of TASC. Because the acquisition occurred on February 26, 2015, the compensation and related information reported in this proxy statement relates to predecessor Engility Holdings, Inc. for the period prior to that date. Unless otherwise noted, references to “Engility”, the “Company”, “we”, “us” or “our” refer to predecessor Engility Holdings, Inc. for all periods prior to the completion of the TASC acquisitions and to successor Engility Holdings, Inc. (f/k/a New East Holdings, Inc.) for all periods subsequent to the TASC acquisition.

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STOCKHOLDER ENGAGEMENT

We value our stockholders’ perspectives on our business and therefore maintain a proactive approach to stockholder engagement. In 2015, our major stockholder engagement activities included attendance at nine major investor conferences and eight investor road shows across North America. During these events, key members of our management team and investor relations staff met with numerous current and prospective stockholders. In addition, we regularly conduct conference calls with existing and potential shareholders and welcome stockholder input via the investor relations section of our website. We prioritize these stockholder engagement activities as we believe that they increase our transparency, visibility and accountability to our investor base.

BOARD OF DIRECTORS

The following table provides summary information regarding each nominee to the Board as well as board members not up for election at this year’s annual meeting. Information about each director’s experience, qualifications and skills can be found beginning on page 4.

 

COMMITTEES

NAME

AGE

DIRECTOR SINCE

PRINCIPAL OCCUPATION

INDEPENDENT

AC

CC

NCGC

OTHER PUBLIC COMPANY BOARDS

Steven A. Denning*

67

2015

Chairman, General Atlantic

None

David M. Kerko*

42

2015

Consultant, KKR

None

Darryll J. Pines*

51

2012

Dean of the Clark School of Engineering, University of Maryland

None

William G. Tobin*

78

2012

Managing Partner, Tobin Group

CHAIR

None

Peter A. Marino+

73

2015

Private consultant

Quality Technology Services

Anthony Principi

71

2012

Principal, The Principi Group

CHAIR

Cleveland Biolabs, Inc.

David A. Savner+

72

2012

Partner, Jenner & Block LLP

None

Lynn A. Dugle

56

2015

Chief Executive Officer, Engility Holdings, Inc.

State Street Corporation

Charles S. Ream

72

2012

Former EVP and CFO, Anteon International Corporation

CHAIR

None

MEETINGS IN 2015:

7

5

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AUDIT COMMITTEE (“AC”), COMPENSATION COMMITTEE (“CC”), NOMINATING/CORPORATE GOVERNANCE COMMITTEE (“NCGC”)

* UP FOR ELECTION AT 2016 ANNUAL MEETING

+ CO-CHAIRMAN OF THE BOARD

 

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PROPOSAL 1    ELECTION OF DIRECTORS

DIRECTORS AND NOMINEES FOR DIRECTOR

Our Amended and Restated Bylaws provide that the number of directors shall be fixed from time to time exclusively by the Board, and shall be divided into three classes. The Board is currently composed of nine directors.

As a condition to the closing of the TASC acquisition, on February 26, 2015, we entered into a Stockholders Agreement with Birch Partners, LP (“Birch Partners”), and for the limited purposes set forth therein, certain investment funds affiliated with Kohlberg Kravis Roberts & Co. L.P. (“KKR”) and certain investment funds affiliated with General Atlantic LLC (“GA” or “General Atlantic”) (the “Stockholders Agreement”), which establishes certain rights, restrictions and obligations of Birch Partners, KKR and GA, and sets forth certain governance and other arrangements relating to Engility, including the right of Birch Partners to designate (i) four directors for nomination to our Board for so long as each of KKR and GA (including their respective affiliates) beneficially owns at least 50% of the shares of our common stock it owned as of February 26, 2015 and (ii) two directors for nomination to our Board for so long as each of KKR and GA (including their respective affiliates) beneficially owns less than 50% but at least 25% of the shares of our common stock it owned as of February 26, 2015.

Pursuant to the Stockholders Agreement, we must include certain director nominees designated by Birch Partners (or after a distribution by Birch Partners to the KKR investors and GA investors, KKR and/or GA, respectively) in the slate of nominees recommended by the Board for election of directors. In the event any Board member nominated by such stockholder party resigns or is unable to serve, the stockholder parties will be entitled to appoint a replacement stockholder party director.

As of the effective date of the TASC acquisition and pursuant to the Stockholders Agreement discussed above, the size of our Board was increased from seven members to 11 members, including the seven members of the Board of Engility serving prior to the TASC acquisition (Edward P. Boykin, Darryll J. Pines, Anthony Principi, Charles S. Ream, David A. Savner, Anthony Smeraglinolo and William G. Tobin) and four members designated by Birch Partners (Peter A. Marino, David M. Kerko, Steven A. Denning and Lynn A. Dugle, collectively, the “TASC Directors”). The TASC Directors were initially apportioned amongst the classes of the Board such that Lynn A. Dugle’s initial term expired at the 2015 annual meeting, where she was subsequently reelected for another three-year term. David M. Kerko and Steven A. Denning have initial terms expiring at this year’s Annual Meeting, and Peter A. Marino has an initial term expiring at our 2017 annual meeting.

In May 2015, Mr. Boykin declined to stand for election to our Board, and in February 2016, Anthony Smeraglinolo, our former President and Chief Executive Officer, resigned from our Board. The terms of four of our incumbent directors expire at the Annual Meeting. These directors are William G. Tobin, Darryll J. Pines, David M. Kerko and Steven A. Denning. The nomination of these directors for re-election to a three-year term has been recommended by the Nominating/Corporate Governance Committee and approved by the Board. There are currently two vacancies on the Board as a result of the retirement of Edward P. Boykin effective as of May 21, 2015 and the resignation of Anthony Smeraglinolo effective February 29, 2016. The Board has decided not to fill these vacancies as of the date of this proxy statement, but will periodically evaluate adding a 10^th and/or 11^th director based on the needs of the Board. The Company has not waived any rights under the Stockholders Agreement.

In addition to the four directors whose terms expire at the Annual Meeting, there are three directors whose terms expire at the 2017 annual meeting and two directors whose terms expire at the 2018

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annual meeting. In each case, directors are elected until their respective successors are duly elected and qualified or until their earlier death, resignation or removal. At each annual meeting, one class of directors is elected for a three-year term.

Unless a proxy specifies otherwise, the persons named in the proxy will vote the shares covered thereby FOR the nominees as listed. Each nominee has consented to be a candidate and to serve, if elected. While the Board has no reason to believe that any nominee will be unavailable, if such an event should occur, it is intended that shares represented by proxies will be voted for substitute nominee(s) as selected by the Board.

We seek to ensure that our Board is composed of members whose particular experience, qualifications, attributes and skills, when taken together, will allow our Board to satisfy its oversight responsibilities effectively in light of our business and structure.

The TASC Directors, as noted above, were each a nominee designated by Birch Partners pursuant to the Stockholders Agreement.

When considering the experience, qualifications, attributes and skills of the Board, we focused primarily on the information discussed in each of the Board members’ biographical information set forth below.

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NOMINEES FOR ELECTION TO BOARD

      Steven A. Denning

Director since 2015

Mr. Denning has served as a director on our Board and as a member of the Compensation Committee of our Board since February 2015. Mr. Denning was a director of TASC from 2009 until February 2015. He is the chairman of General Atlantic. He joined the firm in 1980 and has helped build the organization into one of the leading global equity investment firms focused exclusively on investing in growth companies. Previous board roles include The Thomson Reuters Corporation, Gavilon Holdings, LLC, Genpact Limited, and IHS, Inc., along with several other public and private companies.

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      David M. Kerko

Director since 2015

Mr. Kerko has served as a director on our Board and as a member of the Nominating/Corporate Governance Committee of our Board since February 2015. Mr. Kerko has served as a consultant to KKR since February 2015. Mr. Kerko was a director of TASC from 2009 until February 2015, and until February 2015 Mr. Kerko was an executive of KKR. Mr. Kerko joined KKR in 1998 and is a former member of the Technology industry team within KKR’s Private Equity platform. He was actively involved in KKR’s investments in Borden, Toys ‘R’ Us, TASC, NXP (formerly Philips Semiconductor), Savant and Sonos. Mr. Kerko also serves on the board of directors of Aceco, Savant, Sonos and Transphorm Inc. Prior to joining KKR, Mr. Kerko was with Gleacher NatWest Inc., where he was involved in a broad range of merger and acquisition transactions and financing work. He holds a B.S. and B.S.E., summa cum laude, from the University of Pennsylvania.

      Darryll J. Pines

Director since 2012

Dr. Pines has served as a director on our Board and as member of the Audit Committee and the Nominating/Corporate Governance Committee since 2012. Dr. Pines is Dean of the Clark School of Engineering at the University of Maryland and the Farvardin Professor of Aerospace Engineering. Prior to becoming Dean of the Clark School of Engineering, Dr. Pines served as Chair of the Department of Aerospace Engineering from 2006 through 2009 and as a Professor and Assistant Professor in the Clark School of Engineering from 1995 through 2003. From 2003 through 2006, Dr. Pines also served as Program Manager of the Tactical Technology Office and Defense Sciences Office for DARPA. Dr. Pines currently serves as a member of the board of directors of Aurora Flight Services, which he joined in 2014. Dr. Pines received a Bachelor of Science in Mechanical Engineering from the University of California at Berkley, and a Master of Science and Ph.D. in Mechanical Engineering from the Massachusetts Institute of Technology.

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      William G. Tobin

Director since 2012

Mr. Tobin has served as a director on our Board and as chair of the Compensation Committee since 2012 and as a member of our Nominating/Corporate Governance Committee since March 2016. Mr. Tobin previously served as a member of our Audit Committee from 2012 until February 2015. Mr. Tobin founded The Tobin Group, a management consulting group, in 2003 and continues as its Managing Partner. Previously, Mr. Tobin was Managing Director and Chairman of the Defense & Aerospace practice of Korn/Ferry International from 1986 through 2003. From 1981 through 1985, Mr. Tobin was Founding Partner of The Tobin Group. Prior to founding The Tobin Group, Mr. Tobin served as an officer in the U.S. Army for 20 years. Mr. Tobin is a former director of DynCorp International, Inc., Integrated Defense Technology, Vertex Aerospace and WorldStore International, and an Advisory Board Member of Veritas Capital. Mr. Tobin received a Bachelor of Science in Engineering from the U.S. Military Academy, West Point, a Master of Arts in International Relations from the Elliot School of International Affairs at George Washington University and a Masters of Business Administration from Long Island University.

CONTINUING DIRECTORS UNTIL 2017 MEETING

      Peter A. Marino

Director since 2015

Mr. Marino has served as a director and Co-Chairman of our Board, as a member of the Compensation Committee since February 2015, and as a member of our Nominating/Corporate Governance Committee since March 2016. Mr. Marino was a director of TASC from 2010 to February 2015. Since 2011, he served as the chairman of the TASC board. Since 1999, Mr. Marino has been working as a private consultant for government and industry on defense and intelligence issues in addition to serving on several boards. Mr. Marino serves on the board of Vsitronix, IDSS and Catapult Consultants and on the proxy boards for Inmarsat Government and DRS Technologies, Inc. Mr. Marino has also chaired the proxy boards for BEI Precision and QinetiQ North America. Mr. Marino has held senior executive positions with Fire Arms Training Systems, E–Systems, Inc. and Lockheed Martin Corporation and, for over 16 years, served in a number of senior positions at the Central Intelligence Agency.

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      Anthony Principi

Director since 2012

Mr. Principi has served as a director on our Board, as member of the Nominating/Corporate Governance Committee since 2012 (and as chair of the Nominating/Corporate Governance Committee since February 2015) and as a member of our Audit Committee since March 2016. Mr. Principi previously served as a member of the Compensation Committee from 2012 to February 2015. Mr. Principi serves as Principal of the Principi Group, a consulting firm. From 2005 through 2010, he was Senior Vice President of Government Relations of Pfizer, Inc., a biopharmaceutical company. Prior to joining Pfizer, Inc., Mr. Principi served as Secretary of the U.S. Department of Veterans Affairs from 2001 through 2005. In 2005, he served as the Chairman of the Defense 2005 Base Realignment and Closure Commission. Prior to becoming Secretary of the U.S. Department of Veterans Affairs, Mr. Principi was President of QTC Medical Services Inc. from 1999 through 2001 and Senior Vice President of Lockheed Martin IMS from 1995 through 1996. Prior to joining Lockheed Martin IMS, Mr. Principi was Chief Counsel and Staff Director of the U.S. Senate Armed Services Committee from 1993 through 1994, and was Chief Counsel and Staff Director of the U.S. Senate Committee on Veterans’ Affairs from 1984 through 1988. Mr. Principi serves as a director and member of the Corporate Governance and Compensation and Evaluation Committees of Mutual of Omaha, as a director and member of the Nominating and Governance Committee of Cleveland BioLabs, Inc. and as a director and member of the Nominating and Corporate Governance Committee of Imprimis Pharmaceuticals, Inc. Mr. Principi served as Executive Chairman of QTC Management, and was a director of Perot Systems Corporation. Mr. Principi received a Bachelor of Science from the U.S. Naval Academy and a Juris Doctor from Seton Hall University School of Law.

      David A. Savner

Director since 2012

Mr. Savner has served as a director on our Board since 2012, as Co-Chairman of our Board since February 2015, as a member of the Compensation Committee since February 2015 and as a member of our Audit Committee since March 2016. From 2012 until February 2015, Mr. Savner was chair of the Nominating/Corporate Governance Committee. Mr. Savner is a Partner with the law firm of Jenner & Block LLP, and a member of its Corporate Practice. Prior to rejoining Jenner & Block, Mr. Savner was Senior Vice President, General Counsel and Secretary of General Dynamics, an aerospace and defense company, from 1999 to 2009. Prior to joining General Dynamics, Mr. Savner was a Partner of Jenner & Block, and Chair of its Corporate Practice. Mr. Savner received a Bachelor of Arts from Northwestern University and a Juris Doctor from Northwestern University School of Law.

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CONTINUING DIRECTORS UNTIL 2018 MEETING

      Lynn A. Dugle

Director since 2015

Ms. Dugle has served as a director on our Board since February 26, 2015 and as our Chief Executive Officer since March 2016. Ms. Dugle previously served as a member of our Audit Committee from February 2015 to March 2016. Ms. Dugle was a director of TASC from October 2014 to February 2015. Ms. Dugle joined Raytheon Company, a publicly traded company specializing in defense and other government markets throughout the world, in April 2004 and served as the Vice President of Raytheon Company and President of Raytheon IIS until March 2015. She became President of the former Intelligence and Information Systems business in January 2009 and was previously its Vice President and Deputy General Manager. Ms. Dugle serves as a director and member of the Audit and Technology Committees of State Street Corporation, a publicly traded financial holding company, and as a member of the Defense Science Board.

      Charles S. Ream

Director since 2012

Mr. Ream has served as a director on our Board and as chair of the Audit Committee since 2012 and served as a member of the Compensation Committee from 2012 to February 2015. Mr. Ream was Executive Vice President and Chief Financial Officer of Anteon International Corporation, an international information technology firm, until his retirement in 2006. Prior to joining Anteon International Corporation in 2003, Mr. Ream was Senior Vice President and Chief Financial Officer of Newport News Shipbuilding, Inc. from 2000 through 2001. Prior to joining Newport News Shipbuilding, Mr. Ream served as Senior Vice President of Finance of Raytheon Systems Company from 1998 through 2000, and served as Chief Financial Officer of Hughes Aircraft Company from 1994 through 1997. Prior to joining Hughes Aircraft Company, Mr. Ream was a Partner at Deloitte & Touche LLP. Mr. Ream serves as Audit Committee Chairman of Truvan Health Analytics, Inc., a portfolio company of Veritas Capital. Mr. Ream served as a director of AeroFlex Holdings Corp., Allied Defense Group, Inc., Vencore, Inc., Vangent, Inc., Stanley, Inc., DynCorp International, Inc. and Stewart & Stevenson Services, Inc. Mr. Ream received a Bachelor of Science in Accounting from the University of Arizona and a Master of Accounting from the University of Arizona. Mr. Ream is a Certified Public Accountant (inactive).

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VOTE REQUIRED; RECOMMENDATION

The affirmative vote of a plurality of the votes cast at the Annual Meeting is required to approve the election of each of the nominees for election as a director. All nominees for election as directors at the Annual Meeting currently serve on the Board. If no voting specification is made on a properly returned or voted proxy card, the proxies will vote FOR the election of William G. Tobin, Darryll J. Pines, David M. Kerko and Steven A. Denning as directors to hold office until the 2019 annual meeting of stockholders and until their respective successors are elected and qualified. Abstentions and broker non-votes will have no effect on Proposal 1 because they are not considered votes cast.

The Board unanimously recommends that stockholders vote “FOR” each of the director nominees.

CORPORATE GOVERNANCE

Our Corporate Governance Guidelines, which include information regarding the Board’s mission and director responsibilities, director qualifications and determination of director independence and other guidelines, are available on the Company’s website, www.engilitycorp.com, by clicking on “Investor Relations” and then “Corporate Governance”. This section of the website makes available all of the Company’s corporate governance materials, including the Company’s Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, the charters for each Board committee, the Company’s Code of Ethics and Business Conduct (the “Code of Conduct”), the Company’s Supplier Code of Conduct and information about how to report concerns about the Company. Instructions for how to obtain copies of the Company’s corporate governance documents and how to communicate with the Company’s directors are included below. The Board regularly reviews developments in corporate governance and updates the Corporate Governance Guidelines and other governance documents as it deems necessary and appropriate.

CORPORATE GOVERNANCE GUIDELINES

The Company has adopted Corporate Governance Guidelines that we believe reflect the Board’s commitment to a system of governance that enhances corporate responsibility and accountability. The Corporate Governance Guidelines contain provisions addressing the following matters, among others:

We intend to disclose any future amendments to our Corporate Governance Guidelines on our website.

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DIRECTOR INDEPENDENCE

Our Board, upon recommendation of our Nominating/Corporate Governance Committee, has determined that the following directors are independent, representing each of our non-executive directors: Steven A. Denning, David M. Kerko, Peter A. Marino, Darryll J. Pines, Anthony Principi, Charles S. Ream, David A. Savner, and William G. Tobin. Our Board annually determines the independence of directors based on a review by the Board and the Nominating/Corporate Governance Committee. No director will be considered independent unless the Board affirmatively determines that he or she has no material relationship with us, either directly or as a partner, stockholder, or officer of an organization that has a relationship with us. Material relationships can include commercial, industrial, banking, consulting, legal, accounting, charitable, and familial relationships, among others. To evaluate the materiality of any such relationship, the Board has determined it is in the best interests of the Company to adopt categorical independence standards that are set forth in the Corporate Governance Guidelines.

The Board also considers certain objective standards in affirmatively determining whether a director is independent, including those objective standards set forth in the NYSE rules, which generally provide that:

In making its determination as to the independence of our directors, the Board considered (i) that Messrs. Marino, Denning and Kerko were nominated pursuant to the Stockholders Agreement by Birch Partners, the owner of approximately 51.1% of our outstanding common stock, (ii) Mr. Marino’s former position as Executive Chairman of TASC prior to the completion of the TASC acquisition and (iii) Mr. Denning’s position as Chairman of GA and Mr. Kerko’s former position as an executive of KKR, and that GA and KKR through Birch Partners beneficially own approximately 51.1% of our outstanding common stock. The Board considered the above relationships of Messrs. Marino, Denning and Kerko and affirmatively determined that these relationships did not impair their independence.

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COMMITTEES OF THE BOARD OF DIRECTORS

The primary standing committees of our Board include an Audit Committee, a Compensation Committee and a Nominating/Corporate Governance Committee each as further described below. Each of these committees is composed exclusively of directors who are independent as defined in the NYSE listing standards. In addition, the Board has established a subcommittee of our Compensation Committee consisting of Messrs. Savner and Tobin for purposes of approving any compensation that may otherwise be subject to Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), and for purposes of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We also have a Special Activities Committee as discussed further below. Other committees may also be established by the Board from time to time. Committee membership shown below is as of the date of this proxy statement.

Chairperson		Member				Financial Expert		Co-Chair
		Audit Committee		Compensation Committee		Nominating/Corporate Governance Committee		Special Activities Committee
Steven A. Denning
Lynn A. Dugle
David M. Kerko
Peter A. Marino
Darryll J. Pines
Anthony Principi
Charles S. Ream
David A. Savner
William G. Tobin

Audit Committee. The Audit Committee of our Board (the “Audit Committee”) has the responsibility, among other things, to meet periodically with management and with both our independent auditor and internal auditor to review audit results and the adequacy and effectiveness of our system of internal controls. In addition, the Audit Committee appoints or discharges our independent auditor, reviews and approves auditing services and permissible non-audit services to be provided by the independent auditor in order to evaluate the impact of undertaking such added services on the independence of the auditor and reviews and approves or ratifies transactions with related persons. The responsibilities of the Audit Committee are more fully described in our Audit Committee charter, which is posted on our website at www.engilitycorp.com and will be available in print to any stockholder who requests it. All members of the Audit Committee are independent and financially literate. Further, the Board has determined that Charles S. Ream possesses accounting or related financial management expertise within the meaning of the NYSE listing standards and that Charles S. Ream qualifies as an “audit committee financial expert” as defined under the applicable Securities and Exchange Commission (“SEC”) rules. In 2015, the Audit Committee met seven times.

Compensation Committee. The Compensation Committee of our board (the “Compensation Committee”) oversees all compensation and benefit programs and actions that affect our executive officers and directors. The Compensation Committee also provides strategic direction for our overall compensation structure, policies and programs. Pursuant to the Compensation Committee’s charter, the Compensation Committee is entitled to delegate any or all of its responsibilities to a subcommittee of the Compensation Committee, consisting of one or more independent members of the Compensation Committee. The Board has established a subcommittee of our Compensation

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Committee consisting of Messrs. Savner and Tobin for purposes of approving any compensation that may otherwise be subject to Section 162(m) of the Code and for purposes of Section 16 of the Exchange Act. The responsibilities of the Compensation Committee are more fully described in the Compensation Committee charter, which is posted on our website at www.engilitycorp.com and will be available in print to any stockholder who requests it. Each member of the Compensation Committee is an independent, non-employee director, and there are no Compensation Committee interlocks involving any of the members of the Compensation Committee. In 2015, the Compensation Committee met five times.

Nominating/Corporate Governance Committee. The Nominating/Corporate Governance Committee of our Board (the “Nominating/Corporate Governance Committee”) is responsible for developing and recommending to the Board criteria for the selection of director candidates; identifying, reviewing the qualifications of and proposing candidates for election to the Board including the evaluation of candidates for the Board recommended by the Company’s stockholders in accordance with the instructions set forth under “Stockholder Nominees” below; reviewing the performance of incumbent directors in determining whether to recommend them for reelection to the Board; considering questions of independence and possible conflicts of interest of incumbent directors and executive officers; overseeing the annual performance review of the Company’s Chief Executive Officer; and overseeing and approving the continuity planning process. The Nominating/Corporate Governance Committee also reviews and recommends action to the Board on matters involving corporate governance and, in general, oversees the evaluation of the Board. The responsibilities of the Nominating/Corporate Governance Committee are more fully described in the Nominating/Corporate Governance Committee charter, which is posted on our website at www.engilitycorp.com and will be available in print to any stockholder who requests it. Each member of the Nominating/Corporate Governance Committee is independent. In 2015, the Nominating/Corporate Governance Committee met one time.

Special Activities Committee. In addition to the primary standing committees of our Board, the Board has also established a Special Activities Committee that is responsible for assisting the Board in fulfilling its oversight responsibility of the Company’s business activities that for purposes of national security have been designated as classified by the United States government; providing proper governance related to the Company’s work in classified Intelligence, Space and Special Access Department of Defense programs within the context of the Board’s overarching governance responsibilities; and assisting the Board in assessing the Company’s strategic, operational and financial performance within the Intelligence community markets. The responsibilities of the Special Activities Committee are more fully described in the Special Activities Committee charter, which is posted on our website at www.engilitycorp.com and will be available in print to any stockholder who requests it. In 2015, the Special Activities Committee met two times.

EXECUTIVE SESSIONS

Our Corporate Governance Guidelines provide that non-management directors shall meet at regularly scheduled executive sessions, which will typically occur at regularly scheduled Board meetings, without any member of management present. In addition, at least annually, the independent directors will meet in separate executive session. David A. Savner and Peter A. Marino, the independent Co-Chairmen of the Board, currently preside over each session. According to our Corporate Governance Guidelines, unless there is a non-employee Chairman, or Co-Chairman, as applicable, the Board shall annually elect or reaffirm by majority vote a Lead Independent Director, who shall lead the executive sessions. Our Corporate Governance Guidelines also provide that the executive sessions shall serve as the forum for the annual evaluation of the performance of the Company’s Chief Executive Officer, the annual review of the Chief Executive Officer’s plan for management succession and the annual evaluation of the performance of the Board.

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CRITERIA FOR DIRECTOR NOMINATIONS

Our Board is responsible for nominating directors for election by stockholders. Subject to the requirements of the Stockholders Agreement, in nominating a slate of directors, our Board, with the assistance of the Nominating/Corporate Governance Committee, will take into account (a) minimum individual qualifications, including strength of character, mature judgment, industry knowledge or experience and an ability to work collegially with the other members of our Board, and (b) all other factors it considers appropriate, which may include ensuring that the Board, as a whole, is appropriately diverse and consists of individuals with various and relevant career experience, relevant technical skills, industry knowledge and experience and financial and accounting experience to enable the Nominating/Corporate Governance Committee to determine whether the director candidate would be suitable for membership on the Company’s Audit Committee (including as an “audit committee financial expert”). The Board should monitor 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. The Nominating/Corporate Governance Committee also may consider the extent to which a director candidate would fill a present need on the Board.

When seeking candidates for director, the Nominating/Corporate Governance Committee may solicit suggestions from incumbent directors, management or others, including stockholders. Individuals recommended by stockholders for nomination as a director should be submitted to the Company’s Corporate Secretary and, if submitted in accordance with the procedures set forth in this proxy statement and the Company’s Amended and Restated Bylaws, will be forwarded to the Nominating/Corporate Governance Committee. The Nominating/Corporate Governance Committee will review all candidates in the same manner, regardless of the source of the recommendation. After conducting an initial evaluation of a candidate, the Nominating/Corporate Governance Committee will interview that candidate if it believes the candidate might be suitable to be a director. The Nominating/Corporate Governance Committee may also ask the candidate to meet with management. If the Nominating/Corporate Governance Committee believes a candidate would be a valuable addition to the Board, it will recommend to the full Board such candidate’s election.

STOCKHOLDER NOMINEES

Our Amended and Restated Bylaws provide that stockholders seeking to nominate candidates for election as directors or to bring business before an annual or special meeting of stockholders must provide timely notice of their proposal in writing to the Corporate Secretary of the Company. Generally, to be timely, a stockholder’s notice must be received at our principal executive offices, addressed to the Corporate Secretary of the Company, and within the following time periods:

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In no event shall an adjournment or postponement of a meeting of the stockholders for which notice has been given commence a new time period (or extend any time period) for the giving of the stockholder notice. You should consult our Amended and Restated Bylaws for more detailed information regarding the process by which stockholders may nominate directors. Our Amended and Restated Bylaws are posted on the Corporate Governance portion of our website located at www.engilitycorp.com.

BOARD LEADERSHIP STRUCTURE

The Board has determined that the Company and its stockholders are currently best served by having David A. Savner and Peter A. Marino serve as Co-Chairmen, which is likewise a requirement pursuant to the terms of the Stockholders Agreement. This structure promotes unified leadership in light of the recent business combination, and having independent chairmen enhances the ability of the Board to carry out its oversight function.

The Board believes that the decision as to whether to combine or separate the Chief Executive Officer and Chairman of the Board positions will depend on the facts and circumstances facing the Company at a given time and could change over time. The Board believes that the Company’s current leadership structure is appropriate and does not adversely affect the Board’s role in risk oversight of the Company.

BOARD’S ROLE IN RISK OVERSIGHT

Risk is inherent with every business. Management is responsible for the day-to-day management of risks the Company faces, while the Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk oversight role, the Board has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed. Our Board oversees an enterprise-wide approach to risk management, designed to support the achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance stockholder value. A fundamental aspect of risk management is not only understanding the risks a company faces and what steps management is taking to manage those risks, but also understanding what level of risk is appropriate for the Company. The involvement of the full Board in setting our business strategy is a key part of its assessment of management’s appetite for risk and also a determination of what constitutes an appropriate level of risk for the Company.

In 2015, we conducted an annual enterprise risk management assessment led by our Corporate Compliance Officer and our Director of Internal Audit, who reports directly to our Audit Committee. In this process, we assessed risk throughout the Company by conducting interviews of our employees and the Chairman of our Audit Committee, soliciting information regarding business risks that could significantly adversely affect the Company. Our Corporate Compliance Officer and Director of Internal Audit prepared a report for the Audit Committee, regarding the key identified risks and how we manage these risks to review and analyze both on an annual and ongoing basis. In addition, senior management attends the quarterly Board meetings and is available to address any questions or concerns raised by the Board regarding risk management and any other matters. Each quarter, the Board also receives presentations from senior management on strategic matters involving our operations.

While the Board has the ultimate oversight responsibility for the risk management process, various committees of the Board assist the Board in fulfilling its oversight responsibilities in certain areas of risk. In particular, the Audit Committee focuses on financial and enterprise risk exposures, including

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internal controls, and discusses with management, our Director of Internal Audit, our Corporate Compliance Officer, our Corporate Ethics Officer and our independent registered public accounting firm, our policies with respect to risk assessment and risk management. The Audit Committee also assists the Board in fulfilling its duties and oversight responsibilities relating to the Company’s compliance with applicable laws and regulations, the Code of Conduct and related Company policies and procedures. The Compensation Committee assists the Board in fulfilling its oversight responsibilities with respect to the management of risks arising from our compensation policies and programs as described on page 25 of this proxy statement in “Executive Compensation—Compensation Discussion and Analysis”.

BOARD MEETINGS AND COMMITTEES; POLICY REGARDING DIRECTOR ATTENDANCE AT ANNUAL MEETINGS OF STOCKHOLDERS

During 2015, our Board held five meetings. All directors attended at least 75% of the Board meetings and meetings of the committees of the Board on which the director served, held during the period for which he or she served as a director. It is our policy that directors are strongly encouraged to attend the Company’s annual stockholder meetings. At the 2015 annual meeting of stockholders, all of the directors serving on our Board at the time attended the meeting.

CODE OF ETHICS AND BUSINESS CONDUCT

We have a Code of Conduct that is applicable to all our directors, officers and employees. The Code of Conduct is available on the Corporate Governance page of our website at www.engilitycorp.com. To the extent required pursuant to applicable SEC regulations, we intend to post amendments to or waivers from our Code of Conduct (to the extent applicable to our principal executive officer, principal financial officer or principal accounting officer) at these locations on our website or report the same on a Current Report on Form 8-K. Our Code of Conduct is available free of charge upon request to our Corporate Secretary, Engility Holdings, Inc., 3750 Centerview Drive, Chantilly, Virginia 20151.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The members of our Compensation Committee in fiscal 2015 were (i) from January 1, 2015 until the closing of the TASC acquisition, Messrs. Tobin, Principi and Ream; and (ii) following the closing of the TASC acquisition, Messrs. Denning, Marino, Savner and Tobin. All members of the Compensation Committee in fiscal 2015 were independent within the meaning of the NYSE listing standards, and no member was an employee or former employee of the Company. During fiscal 2015, no member of the Compensation Committee had any relationship requiring disclosure under the section “Certain Relationships and Related Party Transactions.” None of our executive officers served during fiscal 2015 as a member of the compensation committee (or other committee serving an equivalent function) of any other entity, one of whose executive officers served as a director on the Board or as a member of the Compensation Committee. None of our executive officers served during fiscal 2015 as a director of any other entity, one of whose executive officers served as a member of the Compensation Committee.

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COMMUNICATION WITH THE BOARD OF DIRECTORS

Our stockholders and other interested parties may communicate directly with any chair of the Audit, Nominating/Corporate Governance and Compensation Committees, or to the non-management directors as a group. All communications should be in written form and directed to Thomas O. Miiller, Senior Vice President, General Counsel and Corporate Secretary, Engility Holdings, Inc., 3750 Centerview Drive, Chantilly, Virginia 20151.

Complaints or concerns about our accounting, internal accounting controls and auditing matters, including those regarding the circumvention or attempted circumvention of internal accounting control or that would otherwise constitute a violation of the Company’s accounting policies, may be reported anonymously to our Audit Committee by writing to Engility Holdings, Inc., Attention: Audit Committee, 3750 Centerview Drive, Chantilly, Virginia 20151. Company employees must report any such accounting allegation in accordance with the Company’s Whistleblower Policy. The Company prohibits any employee from retaliating or taking any adverse action against anyone for raising or helping to resolve any integrity questions.

DIRECTOR COMPENSATION

Directors who also serve as employees of the Company do not receive payment for services as directors. The Compensation Committee is responsible for reviewing and making recommendations to the Board regarding all matters pertaining to compensation paid to our directors for Board, committee and committee chair services. Under the Compensation Committee’s charter, the committee is authorized to engage consultants or advisors in connection with its review and analysis of director compensation.

In making non-employee director compensation recommendations, the Compensation Committee takes various factors into consideration, including, but not limited to, the responsibilities of directors generally, as well as committee chairs, and the forms of compensation paid to directors by comparable companies. The Board reviews the recommendations of the Compensation Committee and determines the form and amount of director compensation.

The 2015 compensation program for our non-employee directors is described further below.

The Board believes that our non-employee directors’ compensation program:

2015 DIRECTOR COMPENSATION PROGRAM

Non-employee director compensation in fiscal 2015 consisted of an annual cash retainer of $75,000 and an annual equity award of restricted stock units with a grant date fair value of $100,000 and a one year cliff vesting. Under our fiscal 2015 non-employee director compensation program, we also paid an

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annual cash retainer for serving as a Board chairperson of $40,000, an annual cash fee for serving as chair of the Audit Committee of $20,000, an annual cash fee for serving as chair of the Compensation Committee of $15,000, an annual cash fee for serving as chair of the Nominating/Corporate Governance Committee of $10,000, an annual cash fee for serving as an Audit Committee member of $10,000, an annual cash fee for serving as a Compensation Committee member of $7,500 and an annual cash fee for serving as a Nominating/Corporate Governance Committee member of $5,000.

The following table details the total compensation of the Company’s non-employee directors for the year ended December 31, 2015.

2015 Director Compensation

The Company cautions that the amounts reported for these awards may not represent the amounts that the directors will actually realize from the awards. Whether, and to what extent, a director realizes value will depend on the Company’s performance and stock price, and continued service on our Board.

Following its annual review of our director compensation program, the Board, upon the recommendation of the Compensation Committee and its independent compensation consultant, Frederick W. Cook & Co. Inc. (“F.W. Cook”), did not modify our non-employee director compensation for fiscal year 2016. Each of Steven A. Denning and David M. Kerko has waived his compensation as a director of the Company.

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OUR EXECUTIVE OFFICERS

The following table sets forth the information as of March 31, 2016 regarding our executive officers.

Lynn A. Dugle—Ms. Dugle has served as a Director on our Board since February 2015 and as our Chief Executive Officer since March 2016. Ms. Dugle previously served as a member of our Audit Committee from February 2015 to March 2016. Ms. Dugle was a director of TASC from October 2014 to February 2015. Ms. Dugle joined Raytheon Company in April 2004 and served as the Vice President of Raytheon Company and President of Raytheon IIS until March 2015. She became President of the former Intelligence and Information Systems business in January 2009 and was previously its Vice President and Deputy General Manager. Ms. Dugle serves as a Director and member of the Audit and Technology Committees of State Street Corporation, and as a member of the Defense Science board.

John P. Hynes, Jr.—Mr. Hynes has served as our President and Chief Operating Officer since March 2016, and previously served as our Executive Vice President and Chief Operating Officer since our acquisition of TASC in February 2015. Mr. Hynes served as President and Chief Executive Officer of TASC from 2013 to February 2015, and before being named to this role, Mr. Hynes was TASC’s Executive Vice President and Chief Operating Officer. Prior to his promotion to TASC’s Chief Operating Officer in September 2012, since 2011 Mr. Hynes was Senior Vice President of TASC’s Defense and Civil Group, the TASC organization that supported the Department of Defense, Department of Homeland Security and civilian agencies such as the Federal Aviation Administration and NASA. Before that, Mr. Hynes was Senior Vice President and General Manager of SAIC’s Mission Support Business Unit, a 3,600-person organization with more than $1 billion in revenue earned from a wide array of services to the intelligence community, including geospatial products, all-source analysis, operational support and language services. During his military service, Hynes was a naval aviator, and served at the Navy Operational Intelligence Center. Mr. Hynes currently serves on the board of advisors of the Intelligence and National Security Association and on the board of directors of the Capital Area Food Bank.

Wayne M. Rehberger—Mr. Rehberger has served as our Senior Vice President and Chief Financial Officer since our acquisition of TASC in February 2015. He had previously served as Senior Vice President and Chief Financial Officer of TASC since June 2010. Mr. Rehberger has more than 25 years of diversified financial and telecommunications management experience. Prior to joining TASC in June 2010, he was the Chief Operating Officer of XO Communications, a facilities-based telecommunications services provider. Before taking on the role of Chief Operating Officer in May 2004, Mr. Rehberger had served as XO Communications’ Chief Financial Officer since November 2000. From June 1986 until March 2000, Mr. Rehberger was affiliated with MCI Communications, where he held several broad financial roles, including Senior Vice President of Finance. Mr. Rehberger began his corporate career with the KPMG consulting business in Washington, D.C., where he worked primarily with U.S. government agencies and defense contractors. Mr. Rehberger also served for 10 years in the United States Army and Army Reserve, achieving the rank of major. He earned a Master of Business Administration at the University of South Carolina and a Bachelor of Science degree in business administration at Bucknell University.

Thomas O. Miiller—Mr. Miiller has served as our Senior Vice President, General Counsel and Corporate Secretary since 2012. Mr. Miiller previously served as Senior Vice President and General

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Counsel of L-3 Services Group since he rejoined L-3 Communications Holdings, Inc. (“L-3”) in December 2004. He had previously served in various legal positions within L-3 and its predecessor companies from 1987 through 2000. In the years prior to rejoining L-3, Mr. Miiller was Vice President, General Counsel and Secretary of Allied Aerospace, Inc., a privately held defense aerospace company. Before joining L-3 in 1987, Mr. Miiller was an attorney in the Dykema Gossett law firm in Washington D.C. Mr. Miiller has a Bachelor’s degree in Political Science from the University of Utah and a Juris Doctor’s degree from the National Law Center, George Washington University.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

In accordance with its charter, unless otherwise approved or ratified pursuant to the “Related Person Transaction Policy,” our Audit Committee, or the disinterested members of our Board, reviews and approves all related party transactions. Prior to its approval of any related party transaction, the Audit Committee or the disinterested directors will discuss the proposed transaction with management, including the nature of the related person’s interest in the transaction and all material terms and conditions of the transaction.

STOCKHOLDERS AGREEMENT

On February 26, 2015 the Company entered into the Stockholders Agreement with Birch Partners, certain investment funds affiliated with KKR and certain investment funds affiliated with GA. The Stockholders Agreement became effective upon the closing of the TASC acquisition and sets forth certain arrangements and contains various provisions relating to, among other things, standstill restrictions, voting restrictions, board representation, transfer restrictions and registration rights, described further below.

Each of Birch Partners, KKR and GA are affiliates of the Company. Birch Partners received 18,796,791 shares, or approximately 51.1%, of the issued and outstanding shares of common stock of the Company as a result of the acquisition of TASC. Birch GP, LLC (“Birch GP”) is the general partner of Birch Partners, and the members of Birch GP are investment funds affiliated with KKR and GA.

In the discussion of the terms of the Stockholders Agreement below, the “stockholder party” means Birch Partners, and, following a distribution of any shares of our common stock, par value $0.01 per share, held by Birch Partners to the KKR investors and the GA investors, the KKR investors and the GA investors. The “stockholder group” means Birch Partners, together with any affiliate of Birch Partners or a KKR investor or GA investor who becomes a “stockholder” within the meaning of the Stockholders Agreement, in each case that beneficially owns any of the Company’s common stock and has become a party to the Stockholders Agreement. In this item discussion, “independent directors” means the directors of the Company who are not nominees of the stockholder party.

Board Representation. The Stockholders Agreement provides the stockholder party with four nominees, subject to the following:

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Pursuant to the Stockholders Agreement, the Company will include the stockholder party nominees in the slate of nominees recommended by the Company’s Board for election of directors and will use its reasonable best efforts to cause the stockholders of the Company to elect the stockholder party nominees. In the event any of the Board members nominated by the stockholder party (a “Stockholder Party Director”) resigns or is unable to serve, the stockholder parties will be entitled to appoint a replacement Stockholder Party Director. The initial Stockholder Party Directors have been divided among the staggered classes of Company directors so that one initial Stockholder Party Director’s term ended at the 2015 annual meeting (where such Stockholder Party Director was subsequently reelected for any additional three-year term), two Stockholder Party Directors have terms ending at this year’s Annual Meeting and one Stockholder Party Director has a term ending at the 2017 annual meeting.

Pursuant to the Stockholder’s Agreement, until February 26, 2017, the Board will maintain a co-chairman structure with one Stockholder Party Director co-chairman and one co-chairman elected by a majority of the independent directors. So long as there are two or more Stockholder Party Directors, one Stockholder Party Director will serve on each committee of the Company’s Board (other than a committee that is to be composed solely of independent directors or a committee established to address conflicts with the stockholder group or the KKR investors or the GA investors). So long as there is at least one Stockholder Party Director serving on the Company’s Board, one Stockholder Party Director will serve on the Compensation Committee. No Stockholder Party Director will serve on any committee if it would violate mandatory legal or listing requirements concerning that director’s independence, but the Company will take all reasonable efforts to avoid any such disqualification.

Voting. So long as the stockholder party has director nomination rights under the Stockholders Agreement, with respect to any proposal or resolution relating to the election of directors, it will vote or cause to be voted all of its voting securities in the same manner as, and in the same proportion to, all shares voted by holders of voting securities (except that with respect to the Stockholder Party Director nominees, the stockholder party may vote all of its voting securities in favor of the Stockholder Party Director nominees). For purposes of the Stockholders Agreement, “voting securities” means the Company’s common stock and shares of any other class of capital stock or interests in any other equity securities of the Company then entitled to vote generally in the election of directors.

In the case of all other proposals or resolutions that require a stockholder vote, the stockholder party will vote or cause to be voted all of its excess voting power (defined as the aggregate percentage of voting power represented by the stockholder group’s voting securities out of the total voting power of all the Company’s common stock, less 30%) in the same manner as, and in the same proportion to, all shares voted by holders of voting securities, excluding the votes or actions of the stockholder group with respect to its voting securities representing 30% of the total voting power of all the Company’s common stock.

Standstill Restrictions. The Stockholders Agreement contains certain standstill provisions generally restricting the stockholder group, certain of the KKR investors and certain of the GA investors and certain of their respective affiliates from February 26, 2015 until, with respect to any party, six months after such party no longer has any rights to nominate or designate nominees to the Company’s board.

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Change of Control. Without the approval of a majority of the independent directors, no member of the stockholder group, the KKR investors or the GA investors may enter into or affirmatively support any transaction resulting in a change of control of the Company in which any member of the stockholder group receives per share consideration in its capacity as a holder of the Company’s common stock in excess of that to be received by other holders of the Company’s common stock.

Transfer Restrictions. The stockholder group, the KKR investors and the GA investors will be subject to certain transfer restrictions related to the Company’s common stock for a period beginning on February 26, 2015 and ending on the earlier of February 27, 2021 and the day following the date on which the Company undergoes an ownership change (as defined in Section 382(g) of the Code) (an “Ownership Change”), including the following:

Notwithstanding the restrictions discussed above, for the period beginning on February 27, 2018 and ending on the earlier of February 27, 2021 and the date on which the Company undergoes an Ownership Change, the Stockholders Agreement permits the KKR investors and GA investors and any partner or co-investor partner to effect an indirect or direct sale or transfer of up to an aggregate of 16,481,516 shares of the Company’s common stock, as adjusted for any stock split, reverse stock split or similar transaction (the “Waived Transfer Amount”). Certain sales or transfers will not count toward or reduce the Waived Transfer Amount, including:

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Notwithstanding the restrictions described above, beginning on the earlier of (i) February 27, 2021 and (ii) the day following the date on which the Company undergoes an Ownership Change, the stockholder group, the KKR investors, the GA investors, the partners and the co-investor partners may, subject to the restrictions described in the immediately following paragraph, directly or indirectly sell or transfer any of the shares of the Company’s common stock held directly or indirectly by them regardless of whether such sale or transfer results in an Owner Shift.

In addition to and notwithstanding the restrictions described above, no member of the stockholder group may, individually or in the aggregate, other than in connection with a registered public offering, including any underwritten offering or a change of control transaction affecting the Company, which change of control transaction is approved by the Board, knowingly transfer shares of the Company’s common stock to a person (other than to any permitted transferee, as defined in the Stockholders Agreement) who, after such acquisition, would hold in excess of 5% of the outstanding shares of the Company’s common stock.

The persons in the stockholder group are, with respect to the shares of the Company’s common stock they hold (“registrable shares”), entitled to certain registration rights beginning February 26, 2018, including (i) the right to request that the Company file an automatic shelf registration statement and effect unlimited underwritten offerings pursuant to such shelf registration statement; (ii) up to eight demand registration rights in the event that the Company is no longer eligible to use or otherwise ceases to maintain an effective shelf registration statement; and (iii) unlimited piggyback registration rights that allow holders of registrable shares to require that shares of the Company’s common stock owned by such holders be included in certain registration statements filed by the Company, in each case subject to the transfer restrictions contained in the Stockholders Agreement. In connection with these registration rights, the Company has agreed to effect certain procedural actions, including taking certain actions to properly effect any registration statement or offering and to keep the participating stockholder parties reasonably informed with adequate opportunity to comment and review, as well as customary indemnification and contribution agreements.

Termination. The Stockholders Agreement will terminate by consent of all parties or when the stockholder group no longer beneficially owns any shares of the Company’s common stock. Certain sections of the Stockholders Agreement, including those relating to indemnification, will survive such termination, and the provisions relating to registration rights will survive termination of the Stockholders Agreement until the first date on which there are no registrable shares outstanding.

OTHER RELATIONSHIPS

Certain investment funds affiliated with KKR hold limited partner interests in Birch Partners, LP and membership interests in Birch GP, LLC, the general partner of Birch Partners, LP, the holder of approximately 51.1% of our outstanding common stock. Further, David M. Kerko, a Director on our Board since February 26, 2015, is a former executive of KKR.

Certain banking institutions (including affiliates of KKR) were commitment parties under our bridge loan commitment which consisted of a commitment to provide a promissory note of $585 million (the “Bridge

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Loan Commitment”) which was used among other things, to: (1) repay outstanding indebtedness under our existing credit facilities; (2) following such repayment but prior to the consummation of the acquisition of TASC, provide funds for the payment of the special cash dividend in connection with the acquisition of TASC; and (3) pay transaction fees and expenses and for general corporate purposes.

Certain banking institutions (including affiliates of KKR) were also party to the Second Amended and Restated First Lien Joinder Agreement, dated December 23, 2014, to TASC’s existing First Lien Credit Agreement, dated as of May 23, 2014 (the “First Lien Credit Agreement”) and the Second Amended and Restated Second Lien Joinder Agreement, dated January 26, 2015, to TASC’s existing Second Lien Credit Agreement (the “Second Lien Credit Agreement”), dated as of May 23, 2014, pursuant to which KKR (among other entities) agreed to provide debt facilities consisting of (i) new senior secured first lien incremental term loans in an aggregate amount of $435.0 million (the “Incremental First Lien Term Facility”), (ii) additional senior secured first lien revolving commitments in an aggregate amount of $65.0 million (the “Incremental First Lien Revolving Facility”) and (iii) new senior secured second lien incremental term loans in an aggregate amount of $150.0 million (the “Incremental Second Lien Facility” and together with the Incremental First Lien Term Facility and the Incremental First Lien Revolving Facility, the “Incremental Debt Facilities”). The Incremental Debt Facilities were implemented in connection with the closing of the acquisition of TASC and used to repay the outstanding indebtedness of the Bridge Loan Commitment.

Certain banking institutions (including at certain points affiliates of KKR) are also lenders under TASC’s existing credit facilities consisting of (i) a $395 million first lien term loan facility maturing on May 23, 2020 (the “First Lien Term Facility”), (ii) a $50 million revolving credit facility that terminates on May 23, 2019, with a $12.5 million letter of credit sublimit and a $15 million swing line loan sublimit (the First Lien Revolving Facility”) and (iii) a $250 million second lien term loan facility maturing on May 23, 2021 (the “Second Lien Facility”, and together with the First Lien Term Facility and the First Lien Revolving Facility, the “Existing Credit Facilities”). The Existing Credit Facilities together with the Incremental Debt Facilities (each of which has the same maturity date as the corresponding existing facility) are referred to as the “TASC Credit Facilities”. An affiliate of KKR received approximately $1.7 million in total fees under the TASC Credit Facilities during 2015. As of March 31, 2016, the interest rates on our First Lien Term Facility, First Lien Revolving Facility and Second Lien Facility were approximately 7%, 8.5% and 12%, respectively. As of the date hereof, affiliates of KKR only hold a portion of the revolving credit facility and do not hold any debt under the other TASC Credit Facilities.

We, and certain of our subsidiaries, now guarantee and provide security for all indebtedness of TASC, including the TASC Credit Facilities. After repayment in full of the Bridge Loan Commitment in connection with the closing of the acquisition of TASC, as of March 31, 2016, we, through the Existing Credit Facilities and the Incremental Debt Facilities, had $758 million outstanding under the first lien indebtedness and $390 million outstanding under the second lien indebtedness. The amount of principal and interest paid from the closing of the acquisition of TASC to March 31, 2016 was approximately $210.3 million.

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EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

INTRODUCTION

This Compensation Discussion and Analysis (the “CD&A”) provides a detailed description of our executive compensation philosophy and program for 2015. The CD&A describes the decisions made by the Compensation Committee under our executive compensation programs and the factors considered in those decisions. Specifically, the CD&A discusses various elements of this compensation program and the reasoning for the particular levels and forms of compensation provided to our named executive officers (“NEOs”). Engility’s NEOs for 2015 were:

EXECUTIVE SUMMARY OF FISCAL 2015 COMPANY PERFORMANCE AND COMPENSATION HIGHLIGHTS

Engility’s compensation program is designed to reward our employees for delivering strong financial performance that benefits our stockholders. The program also incentivizes employees to continue our tradition of delivering superior and cost-effective results to our government customers.

This pay for performance culture closely aligns the compensation of our executive officers and other senior leaders with the interests of our stockholders. For this reason, 100% of the target annual cash incentive compensation of our executive officers for 2015 was based on objective metrics that we believe drive corporate performance and stockholder returns: adjusted earnings before interest, taxes, depreciation and amortization (“AEBITDA”) and days sales outstanding (“DSO”), weighted at 65% and 35%, respectively. We also remained focused on stockholder returns and long-term growth through the grant of performance units, which comprised 60% of the target equity compensation for our executive officers and others in senior leadership. These performance units are discussed on page 35 below.

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2015 BUSINESS HIGHLIGHTS

In February 2015, we completed one of the largest consolidations in the government services industry through our successful acquisition of TASC. TASC is a leading provider of enterprise systems engineering, mission-enabling architectures and value-based solutions for the national security and public safety markets, and provided us with significant new customers and capabilities in the intelligence, space and federal civilian markets.

This transformational acquisition was our second since we became an independent public company in July 2012, and reflects our strategy of acquiring new customers, capabilities and markets through selective acquisitions. In 2014, Engility acquired Dynamics Research Corporation (“DRC”), a leader in the healthcare, homeland security, financial regulation and reform, defense readiness and command, control and communications (C3) markets. Together, these two transactions provided us with the necessary scale to pursue our strategy of positioning the Company for larger contract opportunities.

The TASC and DRC transactions also enabled us to broaden our industry exposure. In 2015, approximately 42% of our business was related to defense customers, and approximately 57% was for intelligence and U.S. federal agencies, compared to approximately 61% and 37%, respectively, in 2014.

A major enabler of our 2015 performance was the successful integration of Engility and TASC on schedule and with synergy cost savings above expectations.

At the end of the year, DSOs were lowered to 56 days, down from 74 days at the end of 2014. We won contract awards worth $1.6 billion and continued to provide our customers with strong program performance and efficient pricing. In terms of our stock performance, for the year ended December 31, 2015, we delivered a total shareholder return (“TSR”) (i.e., the change in share price, plus any dividends) of approximately 1% versus an average TSR of approximately -1% for Standard & Poor (S&P) 500 companies and -6% for Russell 2000 companies in 2015.

CONSIDERATION OF 2015 “SAY-ON-PAY” ADVISORY VOTE

We provided stockholders a “say-on-pay” advisory vote on our executive compensation at the 2015 annual stockholders meeting, which received the approval of 98% of stockholders voting in person or by proxy at the meeting. The Compensation Committee evaluates the results of our “say-on-pay” advisory vote annually, and in accordance with the recommendation of our Board, we intend to conduct this vote annually. In light of the substantial support expressed by our stockholders for our compensation program, the Compensation Committee did not make any changes to our executive compensation program and policies as a direct result of the 2015 “say-on-pay” advisory vote.

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COMPENSATION PHILOSOPHY

Our compensation philosophy supports a pay for performance culture. We target total compensation, which is composed of base salaries and annual and long-term incentive opportunities, to generally approximate market median compensation levels. For 2015, the majority of each executive’s target pay opportunity was delivered in the form of annual cash incentive compensation and stock-based long-term incentive awards. The Compensation Committee believes it is appropriate to deliver above market pay when earned by superior performance and below market pay for underperformance.

The specific objectives of Engility’s program include the following:

To achieve these specific objectives, Engility’s executive compensation programs are guided by the following core principles:

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EXECUTIVE COMPENSATION PRACTICES

Below are executive compensation practices that we have implemented to drive performance. In addition, we have listed practices we have not implemented because we do not believe they serve our stockholders’ long-term interests.

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WHAT WE PAY AND WHY: ELEMENTS OF COMPENSATION

Our annual target total direct compensation (“TDC”) typically consists of three elements: base salary, annual cash incentive compensation and annual grants of long-term equity-based incentive compensation. In 2015, following the TASC acquisition, we also granted incentive performance retention units described on page 36 below. Excluding the one-time grant of performance retention units, 79% of the 2015 target TDC for our Chief Executive Officer (CEO) was either performance-based or long-term incentive compensation and 66% of target TDC for the other NEOs was performance-based or long-term incentive compensation.* The emphasis on performance-based compensation and long-term incentives is consistent with our pay for performance culture and our objective to align the interests of executives and stockholders.

*Pay mix for the Other NEOs reflects the average pay mix for Messrs. Hynes, Rehberger, Miiller, and Dye. This data excludes the pay mix for Messrs. Alber and Reed who separated from service during fiscal 2015.

Base Salary

We pay base salaries to attract talented executives and to provide a fixed base of cash compensation. The Compensation Committee generally sets NEO base salaries within a competitive range of market median. As a result, the Compensation Committee adjusted the 2015 base salaries of our NEOs (excluding Messrs. Rehberger, Hynes and Alber) to bring them within their respective competitive ranges. The base salaries for each NEO for 2015 are set forth below.

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The Compensation Committee approved base salary increases for Messrs. Smeraglinolo, Miiller, Dye and Reed based on a determination to bring them closer to market median salaries, in recognition of the significant additional responsibilities that they each assumed in 2014 and 2015, and to reflect each executive’s performance in 2014. Because Mr. Alber left the Company on February 26, 2015, he was not considered for a base salary increase.

Annual Incentive Awards

For 2015, our Compensation Committee adopted an annual incentive compensation program (the “2015 AICP”) pursuant to the Engility Holdings, Inc. Amended and Restated 2012 Cash Incentive Plan (the “Cash Plan”) to incentivize our senior leaders, including the NEOs, to achieve the Company’s 2015 performance objectives. Specifically, the AEBITDA and DSO targets for the 2015 program were based on the Company’s internal financial projections in its 2015 annual operating plan. These annual incentive awards were paid in accordance with the following formula, as discussed in more detail below.

Annual Incentive Award Targets

Under the 2015 AICP, each NEO had an annual incentive award target, expressed as a percentage of base salary, intended to provide the NEO with target total cash compensation around market median. The 2015 AICP also provided for payment of above-market cash compensation for superior performance. Similarly, it provided for reduced or no cash-based incentive compensation for corporate and personal performance that fell below threshold levels. Award payouts under the 2015 AICP also remained subject to the negative discretion of the Compensation Committee to avoid unwarranted windfalls or based on such other factors as the Compensation Committee deemed appropriate.

The 2015 annual incentive award targets for our NEOs are set forth below.

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Financial Rating

Engility’s executive compensation programs are tightly linked to overall company performance. For this reason, 100% of the target annual incentive award for our NEOs and other senior leaders in 2015 was based on the following two performance measures: AEBITDA and DSO. Together, these two performance measures are referred to as the “Company Performance Measures.” The 2015 target values and weightings are described in the table below.

* Given the importance of AEBITDA to our overall business, the Compensation Committee also determined that performance below the threshold value (discussed below) for this measure would result in no annual incentive awards for our executive officers for 2015.

In 2014, we used adjusted earnings before interest and taxes as our earnings performance measure. For 2015, the Compensation Committee approved the use of AEBITDA as our earnings performance measure, as AEBITDA is the measure more commonly used by our investors to measure our operating performance.

In calculating AEBITDA, the Compensation Committee adjusted net income, as reported in the consolidated and combined financial statements filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, for the following items that the Company’s management believes are not considered core to the Company’s business or otherwise not considered operational or because these charges are non-cash or non-recurring:

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The ultimate payout with respect to the Company Performance Measures was based on our 2015 full year performance against the target values set forth in the tables below. Actual performance for each financial measure was measured against the threshold, target and ceiling values set forth below. If the calculated financial measure falls between these values, linear interpolation is used to arrive at the final percentage payout for such measure.

The table below shows the financial performance of the Company, and the corresponding financial ratings for the 2015 fiscal year.

Bonus Factor (Personal Rating)

In 2014, we used personal ratings as a component (weighted at 20%) of the target annual incentive award. For 2015, the Compensation Committee approved the use of the personal rating as a bonus factor to serve as a multiplier on any amounts payable under the 2015 AICP. The Compensation Committee instituted this change to increase the differentiation in payouts under the 2015 AICP based on personal performance, which it believed would better incentivize participants to achieve or exceed individual performance goals that drive shareholder value. The individual performance of each of our NEOs is evaluated following the end of the fiscal year on a scale from 1 to 5, as set forth in the table below, based on the full year performance of our NEOs. Personal ratings are based on the assessment of the NEO’s performance relative to pre-determined qualitative individual goals, which, in the case of the CEO, are established by the Compensation Committee. The CEO establishes these goals for the other NEOs. The personal rating can reduce or increase from 50% to 150% the amount otherwise payable under the 2015 AICP. Accordingly, the maximum potential payout for any NEO under the 2015 AICP was equal to 300% of the NEO’s target bonus opportunity.

For 2015, the individual goals varied by executive and were based on specific key Company-wide objectives, personal business objectives, critical business outcomes and achievements, overall leadership and adherence of their respective functional areas to the Company’s high standards of ethical conduct.

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Our CEO submits to the Nominating/Corporate Governance Committee a self-assessment of his performance addressing his overall leadership and performance with respect to previously approved objectives. The Nominating/Corporate Governance Committee evaluates the CEO’s performance through a process that solicits input from each member of the Board, and then delivers its assessment of his performance to the Compensation Committee. The Compensation Committee then evaluates the CEO’s performance as it relates to compensation and provides its recommendation to the Board for approval.

Our CEO also provides performance assessments and submits recommended personal ratings to the Compensation Committee for all executives who report directly to him, including our other NEOs. The Compensation Committee considers and approves the personal rating of their compensation.

In determining the personal ratings and payout percentages of our NEOs for 2015, the Compensation Committee considered the 2015 performance of each executive as described below.

Anthony Smeraglinolo.    As President and CEO, Mr. Smeraglinolo led the Company through the successful acquisition TASC, which nearly doubled the Company’s business portfolio while expanding its addressable market. The TASC transaction strongly aligned with the Company’s stated objective to reduce its reliance on defense-related work, and re-position the Company in growth markets such as intelligence, space and other federal civilian agencies. Mr. Smeraglinolo also led the TASC integration process, which delivered synergy and cost savings above plan and ahead of schedule.

John P. Hynes, Jr.    As Executive Vice President and Chief Operating Officer, Mr. Hynes oversaw numerous successful initiatives in 2015 that were designed to optimize the Company’s organizational structure and position the Company for sustainable organic growth. Mr. Hynes worked closely with Mr. Smeraglinolo in developing the Company’s leadership structure following the closing of the TASC transaction, and made several personnel changes within each customer account to better align with the Company’s strategic objectives. Mr. Hynes oversaw the restructuring of the Company’s business development function in order to improve win rates and optimize business development resources. Mr. Hynes also significantly contributed to the Company’s financial performance by managing the Company’s indirect costs below their forecasted levels and overseeing a successful bid protest that resulted in a key win in the Company’s Space Account.

Wayne M. Rehberger.    As Senior Vice President and Chief Financial Officer, Mr. Rehberger led the successful integration of the Company’s finance, accounting, information technology and real estate functions following the TASC transaction, and achieved significant cost savings in each of these areas. He also restructured the Company’s financial reporting function in order to deliver more timely financial data to the Board and senior leadership. Mr. Rehberger oversaw the development of the Company’s operating plan for 2015, and his leadership resulted in the Company’s achievement of several of its key financial objectives. Mr. Rehberger also assumed responsibility for the Company’s investor relations function and oversaw a coordinated outreach to the Company’s key shareholders and analysts.

Thomas O. Miiller.    As Senior Vice President and General Counsel, Mr. Miiller led the legal and compliance functions in 2015, and also assumed responsibility for corporate strategy in connection with the departure of Mr. Reed. Mr. Miiller played a key role in the successful acquisition and subsequent integration of TASC. Mr. Miiller also led the restructuring of the Company’s corporate strategy and market intelligence functions to better align with the Company’s organic growth focus. He was also responsible for strategic oversight of all major litigation and investigations as well as the practices that have led to a reduction in claims against the Company and associated legal expenses. Mr. Miiller also oversaw multiple bid protests in 2015, which resulted in either corrective action or another favorable outcome for the Company. Finally, Mr. Miiller continued his leadership role in the development and administration of the Company’s executive compensation programs.

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Kirk G. Dye.    As Senior Vice President, Human Capital Strategy, Mr. Dye was responsible for creating a new organization focused on the recruitment, retention, development and engagement of the talent required for the Company to accomplish its strategic objectives. Mr. Dye had a leadership role in the subsequent integration of TASC, and served as chair of the integration steering committee. Following the TASC acquisition, Mr. Dye led a Company-wide effort to implement leadership development and cultural initiatives for the combined companies, and was responsible for developing a brand repositioning campaign for the Company. Mr. Dye also assumed responsibility in 2015 for the Company’s communications and market strategy functions, and oversaw the creation of a new marketing strategy linked to the Company’s brand repositioning.

2015 Annual Incentive Award Payments

Based on the formula and performance described above, the Compensation Committee calculated the cash bonuses payable to our NEOs for the 2015 fiscal year as set forth in the table below:

Long-Term Incentive Awards

We provide long-term incentive (“LTI”) awards to our officers, including our NEOs, in the form of equity grants. The target annual LTI for each of our NEOs and other senior leaders takes into account the Company’s long-term business objectives, the ability of each individual to influence the overall performance of the Company, demonstrated performance of each individual, competitive market practices, and aggregate equity usage and impact on shareholder dilution.

2015 LTIP Grants

Our 2015 long-term equity-based program consists of performance units (which can settle in stock or cash, at the discretion of our Compensation Committee), representing 60% of each award, and time-based restricted stock units (“RSUs”), representing 40% of each award. In connection with this program, our Compensation Committee approved the Engility Holdings, Inc. 2015 Long Term Incentive Plan (the “2015 LTIP”), an annual equity compensation plan pursuant to the Engility Holdings, Inc. Amended and Restated 2012 Long Term Performance Plan (the “Equity Plan”), under which each of our NEOs received an award of performance units and RSUs based on a percentage of their base salaries and calculated by dividing the award value by the closing share price of EGL stock on the date of the grant.

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Actual 2017 Revenue and Cash Flow performance will be measured at December 31, 2017, the end of the Performance Period. The performance units then cliff vest on the third anniversary of the grant date and the payout on these awards can range from zero to 200% of the target number of units. This calculated payout may be increased up to 25% of the target number of units if Engility’s TSR during the performance period is in the top quartile relative to the Total Compensation Peer Group (as set forth on page 40) or decreased by 25% if Engility’s TSR is in the bottom quartile. There is no adjustment to the number of performance units if Engility’s TSR falls in the second or third quartiles relative to the Total Compensation Peer Group. Vested performance units may be settled in cash or in shares of the Company’s common stock at the Compensation Committee’s discretion.

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The table below provides (i) the grants of RSUs and performance units to the NEOs in March 2015, expressed as a dollar value and (ii) the target dollar value of such grants.

Performance Retention Awards

In 2015, the Compensation Committee approved a special, one-time grant of performance units, which we refer to as Performance Retention Awards (“PRAs”), for our NEOs except Mr. Alber. The PRAs are intended to align the interests of the newly formed senior leadership team consisting of legacy Engility and TASC executives, recognize their contributions to the successful closing of one of the largest consolidations in the government services industry, promote the successful integration of the transformative TASC acquisition, and retain executive talent critical to the success of the integration and the ongoing operations of our company. The grant date fair value of the awards was equal to 1.5 times the target 2015 LTIP amounts for eligible participants (the “target level”). The number of PRAs that were issued on the grant date was based on the volume weighted average price per share of our common stock for the 20 trading days immediately following the closing of the TASC acquisition. The PRAs cliff vest at the end of a three-year period subject to achievement of a pre-established performance goal related to the transaction—specifically, reducing the Company’s ratio of net debt to AEBITDA. The Compensation Committee chose this metric because it closely measures both the Company’s success in driving cost synergies through the successful integration TASC and its ability to prepay its indebtedness. The maximum number of performance units payable under the PRAs is limited to 200% of the target level and the minimum payout will be 50% of the target level. Vested performance units may be settled in cash or the Company’s common stock at the Compensation Committee’s discretion. These awards were granted on a one-time basis, and there are no other awards of this type outstanding for our NEOs.

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The table below reflects the grant date fair value of the PRAs to each of the NEOs.

Treatment of Equity-Based Awards in Connection with TASC Acquisition

The TASC acquisition constituted a “change in control” of Engility under the terms of our Equity Plan. As a result, the vesting of certain of our equity awards was accelerated and the determination of performance shares eligible to vest was accelerated pursuant to the terms of the applicable awards agreements. Specifically, in connection with the TASC acquisition:

Any performance shares not earned based on the measurements discussed above were forfeited to and cancelled by predecessor Engility. The portion of both the 2013 and 2014 performance shares (together with the payment of the Engility special cash dividend) that were not forfeited were assumed by successor Engility and continue to vest in accordance with the terms of their applicable award agreements. The 2013 performance shares vested in accordance with the terms of the underlying award agreements in March 2016.

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Additional Compensation Elements

Executive Benefits and Perquisites

Deferred Compensation Plans. Historically, Mr. Smeraglinolo made deferral elections under two predecessor L-3 deferred compensation plans, which our Compensation Committee adopted following the Spin-Off: the Engility Corporation Deferred Compensation Plan I and the Engility Corporation Deferred Compensation Plan II. Each of these plans required the distribution of all contributions to participants following a change of control. Accordingly, in 2015, Mr. Smeraglinolo received all of his accrued benefits under these plans following the TASC transaction.

We have also adopted the nonqualified Engility Corporation 2013 Deferred Compensation Plan (the “2013 Deferred Compensation Plan”), which became effective on January 1, 2013, to offer highly compensated senior employees, including our NEOs, an opportunity to save for their future financial needs at little cost to the Company. There are no company matching contributions under the 2013 Deferred Compensation Plan, and deferred amounts earn interest at the prime rate, which is funded by the Company. For 2015, none of our NEOs participated in the 2013 Deferred Compensation Plan.

Perquisites. We provide each of our NEOs with modest perquisites, consisting of executive medical benefits, supplemental life insurance coverage and financial planning and tax assistance.

Severance and Change in Control Benefits. We have adopted two severance plans—the Engility Holdings, Inc. Severance Plan (the “Severance Plan”) and the Engility Holdings, Inc. Change in Control Severance Plan (the “Change in Control Severance Plan” and, together with the Severance Plan, the “Severance Plans”)—to provide competitive severance benefits to the Company’s executive officers, including our NEOs, upon the occurrence of a qualifying separation event. In addition, the vesting of our executives’ outstanding RSUs fully accelerates upon a change in control of the Company, in part, to provide certainty of equity-related benefits. Our performance shares, performance units and PRAs also provide for accelerated vesting in connection with or following a change in control as described on page 51 of this proxy statement.

The TASC acquisition constituted a change in control under the Change in Control Severance Plan. As a result, Mr. Alber received severance benefits under this plan following his departure from Engility on March 4, 2015. Mr. Smeraglinolo and Mr. Reed also received severance benefits under this plan in 2016 following their departures from Engility.

Messrs. Hynes and Rehberger are parties to legacy employment agreements with TASC that were assumed by the Company in the TASC acquisition. In the event of a termination of employment without “cause” or for “good reason” (each as defined in the employment agreements), Messrs. Hynes and Rehberger would be entitled to receive severance benefits equal to 1.5 times base salary, 1.5 times average annual bonus for the two preceding fiscal years, and a lump sum payment equal to the cost of 18 months’ COBRA premiums for continued participation in the Company’s health and welfare plans, plus base salary and a pro rata bonus accrued prior to the date of termination.

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For information on the amounts that would be payable under our Severance Plans and otherwise upon a change in control, see “Executive Compensation—Potential Payments Upon Change in Control or Termination of Employment” beginning on page 51 of this proxy statement. There are no tax-gross ups on any benefits payable under the Severance Plans.

HOW WE MAKE COMPENSATION DECISIONS

Risk Considerations

The Compensation Committee reviews the risks and rewards associated with the Company’s compensation program. The program is designed with features that mitigate risk without diminishing the incentive nature of the compensation. We believe our compensation program encourages and rewards fiduciary responsibility, prudent business judgment and appropriate risk-taking over the short-term and the long-term.

The Compensation Committee, with the participation of its independent compensation consultant, F.W. Cook, and our management, conducted a risk assessment of the Company’s compensation program to assess whether risks arising from the program are reasonably likely to have a material adverse effect on the Company. The compensation program includes several design features in our cash and equity incentive programs that reduce the likelihood of excessive risk-taking.

Based on its assessment, the Compensation Committee believes that our compensation program does not motivate risk-taking that is reasonably likely to have a material adverse effect on the Company.

Use of Market Data and Competitive Compensation Positioning

How Do We Use “Benchmarks”?

The Compensation Committee evaluates and sets compensation for each executive by, in part, using data collected from the annual proxies of our Total Compensation Peer Group as well as industry surveys (“market data”). This market data is compiled to establish competitive compensation benchmarks for each NEO. The Compensation Committee defines competitive for base salaries as the approximately median (50th percentile) of our Total Compensation Peer Group. The Compensation Committee also targets total potential compensation opportunities (including equity awards) within a competitive range of the median of our Total Compensation Peer Group.

In some instances however, the benchmarks resulting from market data may not sufficiently capture the specific responsibilities of our NEOs to assess the competitiveness of their compensation packages. Accordingly, our NEOs may be compensated below or above the levels suggested by the benchmarks based on various considerations, including whether such NEO has assumed additional responsibilities beyond those typical for his or her role.

Decision-Making Process and Role of Executive Officers

Role of the Compensation Committee

Our executive compensation program is administered by the Compensation Committee, which is ultimately responsible for the review and approval of compensation for our CEO and all executives that directly report to the CEO. Key areas of responsibility for the Compensation Committee are described in “Corporate Governance—Committees of the Board of Directors—Compensation Committee” on page 12 of this proxy statement.

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Role of Management and Our Chief Executive Officer

The Company’s management assists the Compensation Committee in the design and development of the competitive compensation program by providing data, analysis and suggested plan designs to the Compensation Committee in order to ensure that Engility’s programs and incentives align with and support the Company’s business strategy.

Our CEO annually reviews the performance of our NEOs (other than the CEO) and recommends their base salary adjustments, annual incentive plan target opportunities and long-term incentive award values to the Compensation Committee. Our CEO has no role, however, in determining his or her own compensation.

Role of the Compensation Consultant

The Compensation Committee selects and compensates an independent outside consultant to advise it on matters concerning executive and director compensation. Since the Spin-Off, the Compensation Committee has retained F.W. Cook as its independent compensation consultant. In order to remain independent, F.W. Cook performs no other services for the Company. In March 2015, the Compensation Committee evaluated whether any relationship with F.W. Cook raises any conflict of interest or impaired F.W. Cook’s independence and determined that it did not.

Total Compensation Peer Group

We use a comparator group of peer companies as a key input when making compensation decisions (the “Total Compensation Peer Group”). Specifically, our peer group is used:

The Total Compensation Peer Group companies for 2015 are listed below.

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ADDITIONAL INFORMATION

Executive Stock Ownership Guidelines

We have stock ownership guidelines for executives, including our NEOs. These guidelines are designed to align the executives’ long-term financial interests with those of our stockholders. The stockholder ownership guidelines are as follows:

Shares that count towards compliance with the guidelines include:

Until they satisfy their applicable ownership guideline, executive officers are required to retain 50% of their vested net shares (after settlement of taxes) acquired pursuant to the Company’s Equity Plan.

Trading Controls and Prohibition on Speculative Transactions

Our NEOs are required to receive the permission of the Company’s General Counsel prior to entering into any transactions in Company securities, including any pledge of Company securities. Generally, trading is permitted only during announced trading periods. NEOs are prohibited from entering into hedging transactions, or engaging in other types of speculative transactions in our stock, including the use of puts, calls and short sales, as are all other Engility employees.

Timing of Equity Grants

Except with respect to new hires or promotions, we typically determine annual executive equity compensation awards each year at a February or March meeting of our Compensation Committee or a subcommittee thereof. We have implemented policies and controls to avoid the appearance of impropriety with respect to the granting and timing of executive equity compensation awards.

Executive Compensation Recovery Policy

In April 2013, the Board, upon the recommendation of the Compensation Committee, adopted a policy that provides for recoupment of performance-based compensation from our executive officers and our chief accounting officer (each, a “Covered Officer”) in the event of a material restatement of the Company’s financial results. In such a situation, the Board will review all performance-based

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compensation awarded to or earned by each Covered Officer on the basis of the Company’s financial performance during fiscal periods materially affected by the restatement. This would include annual cash incentive awards and all forms of performance-based compensation. If, in the Board’s view, the compensation related to the Company’s financial performance would have been lower if it had been based on the restated results, the Board will, to the extent permitted by applicable law, seek recoupment from each Covered Officer of any portion of such performance-based compensation as it deems appropriate after a review of all relevant facts and circumstances.

Tax Considerations

Section 162(m) of the Code, generally limits tax deductibility of compensation paid by a public company to its CEO and certain other highly compensated executive officers to $1 million in the year compensation becomes taxable to the executive, subject to an exception for performance-based compensation that meets specific requirements. The Compensation Committee considers the impact of this rule when developing and implementing its executive compensation programs; however, the Compensation Committee reserves the right to provide compensation that is not tax deductible if it believes the value in doing so outweighs the value of the lost tax deduction.

We anticipate that payments under the Cash Plan and qualifying performance-based awards under the Equity Plan are deductible by the Company.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the foregoing Compensation Discussion and Analysis with management. Based on its review and discussions with management, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.

The foregoing Report of the Compensation Committee shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The Report of the Compensation Committee shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or under the Exchange Act, regardless of any general incorporation language in such filing.

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2015 SUMMARY COMPENSATION TABLE

The following table provides summary information concerning compensation paid or accrued by us to or on behalf of our NEOs.

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2015 GRANTS OF PLAN-BASED AWARDS

The following table summarizes awards made to our NEOs during the year ended December 31, 2015.