DEF 14A of DMC Global Inc.
Filed Apr 1, 2025 · FY20240001308179-25-000334
NOMINEES
NOMINEES The names of the nominees and certain information about them are set forth below. In addition, we have included information about each nominee’s specific experience, qualifications, attributes and skills that led our Board of Directors to conclude that the nominee should serve as a director of the Company, in light of our business and corporate strategy.
NOMINEES
| Name | Position | Age | | James O’Leary | Executive Chairman, Interim President and Chief Executive Officer | 62 | | Simon M. Bates | Director | 58 | | Ruth I. Dreessen | Director | 69 | | Michael A. Kelly | Director | 68 | | Ouma Sananikone | Lead Independent Director | 67 |
NOMINEES
| Director since: 2023 | JAMES O’LEARY Skills and Qualifications • Comprehensive leadership experience in a range of industries, with deep experience in building products • Diverse board experience Current Public Company Directorships: • Builders FirstSource Mr. O’Leary was appointed as a director in November 2023, Executive Chairman of the Board on October 16, 2024, and as the Company’s Interim President and Chief Executive Officer effective as of November 29, 2024. He currently serves as a director of Builders FirstSource, Inc. (NYSE: BLDR), the nation’s leading supplier of structural building products, value-added components and services to the professional building market. He served as Chairman of the Board of a predecessor company, BMC Stock Holdings, Inc., prior to its merger with Builders FirstSource in 2021. He served as a director of BMC beginning in 2014. He has also served as the Chairman of Kinematics Manufacturing Company, a leading global manufacturer of high precision slewing drive systems to the utility-scale solar industry since 2015. He also serves on the board of Prosource Plumbing and as a Senior Advisor to certain private equity firms. He previously served as Chairman and Chief Executive Officer of WireCo Worldgroup, Inc., a leading global manufacturer of engineered wire, steel rope, and synthetic rope, from January 2017 until July 2019. Prior to this, Mr. O’Leary served as Chairman of the Board and Chief Executive Officer of Kaydon Corporation, Inc., a diversified global manufacturer of precision industrial goods, from March 2007 until its successful sale in October 2013. From October 2013 to March 2014, Mr. O’Leary served as a Senior Advisor to the SKF Group, the acquiror of Kaydon Corporation, Inc. From 2005 to March 2007, he served as an independent director of Kaydon Corporation, Inc. Mr. O’Leary is a certified public accountant (currently inactive) in the State of New York and holds a B.B.A. from Pace University and an M.B.A. from the Wharton School of the University of Pennsylvania. |
NOMINEES
| DMC GLOBAL INC. • 2025 PROXY STATEMENT | 5 |
NOMINEES
| Director since: 2024 Independent Committees: • Risk (Chair) • Audit • Compensation • Corporate Governance and Nominating | SIMON M. BATES Skills and Qualifications • Current and practical experience in leadership of global operations, financial analysis, project management, risk management, and health, environment, safety and security matters • Extensive skills in strategic planning and corporate development in the industries in which the Company and its customers operate • Extensive experience in mergers, acquisitions, and divestments Mr. Bates was appointed as a director in June 2024. He served as CEO of Argos North America, one of the largest cement and ready-mix concrete producers in the United States, from October 2022 to January 2024, when Argos North America was sold to Summit Materials. Prior to his role at Argos North America, Mr. Bates held the position of President and Chief Executive Officer and member of the board of directors of GCP Applied Technologies Inc. (“GCP”) from October 2020 to October 2022, when it was acquired by Saint-Gobain. GCP was a leading global provider of construction products, including high performance specialty construction chemicals and building materials. Additionally, Mr. Bates served as a director of U. S. Silica Holdings, Inc. (“SLCA”), a global performance materials company and a leading producer of commercial silica used in the oil and gas industry and in a wide range of industrial applications, from July 2023 until SLCA’s acquisition by Apollo Global Management in July 2024. From April 2017 to October 2020, Mr. Bates served as President of Infrastructure Products Group, a division of CRH plc, a publicly-traded manufacturer of building products and materials. |
NOMINEES
| Director since: 2020 Independent Committees: • Audit (Chair) • Compensation • Corporate Governance and Nominating | RUTH I. DREESSEN Skills and Qualifications • Extensive financial and management background in investment banking and private equity in the chemical and related industries • Substantial experience in financial analysis, capital markets and strategic planning • Over two decades of financial leadership experience in the chemical, energy and petrochemical industries Ms. Dreessen was appointed as a director in October 2020. She has more than 25 years of experience in financial leadership roles, specifically in the chemical industry. From 2020 to 2024, Ms. Dreessen served as an Operating Partner of Triten Energy Partners, a private equity firm. From 2012 to 2023, she served as a director, and from 2015 to 2023, Chairperson of Gevo, Inc. (NASDAQ: GEVO), a publicly held company focused on sustainable aviation fuel. From 2010 to December 2018, Ms. Dreessen was a Managing Director of Lion Chemical Partners, LLC, a private equity firm focused on chemical and related industries. Prior to joining Lion Chemical Partners, Ms. Dreessen served as the Executive Vice President and Chief Financial Officer of TPC Group Inc. from 2005 to 2010. Before joining TPC Group, Ms. Dreessen was Senior Vice President, Chief Financial Officer and Director of Westlake Chemical Corporation. Previously she spent 21 years at J.P. Morgan Securities LLC and predecessor companies, ultimately as a Managing Director of chemicals investment banking. Ms. Dreessen received her undergraduate degree from the New College of Florida and holds a master’s degree in International Affairs from Columbia University. In 2024, Ms. Dreessen earned a CERT Certificate in Cybersecurity Oversight from Carnegie Mellon University. |
NOMINEES
| DMC GLOBAL INC. • 2025 PROXY STATEMENT | 6 |
NOMINEES
| Director since: 2020 Independent Committees: • Compensation (Chair) • Corporate Governance and Nominating • Risk | MICHAEL A. KELLY Skills and Qualifications • Diversified background in finance, operations and the life sciences industry • Extensive skills in executive leadership, finance, operations and management • In depth experience with a multinational company operating in global markets Current Public Company Directorships: • Amicus Therapeutics, Inc. • NeoGenomics, Inc. • Prime Medicine, Inc. Mr. Kelly was appointed as a director in July 2020. He has more than two decades of executive experience in senior leadership roles in the life sciences industry. He founded and has served as President of Sentry Hill Partners, LLC, a global life sciences transformation and management consulting business, since January 2018. Mr. Kelly worked in various capacities at Amgen, Inc. from 2003 to 2017, most recently as Senior Vice President, Global Business Services from July 2014 to July 2017, and as acting Chief Financial Officer from January to July 2014. Prior to his service at Amgen, he served as Chief Financial Officer of Tanox, Inc. from 2000 to 2003, Vice President, Finance and Corporate Controller of Biogen, Inc. from 1998 to 2000 and Vice President, Finance and Chief Financial Officer of Nutrasweet Kelco Company from 1996 to 1998. From February 2019 to April 2023, he served on the board of directors of HOOKIPA Pharma, Inc., a biopharmaceutical company. He currently serves as an independent member of the board of directors for each of Amicus Therapeutics, Inc. (NASDAQ: FOLD), NeoGenomics, Inc. (NASDAQ:NEO) and Prime Medicine, Inc. (NASDAQ: PRME) each of which is a publicly traded company. Mr. Kelly holds a bachelor’s degree in Business Administration from Florida A&M University. |
NOMINEES
| Director since: 2023 Independent Committees: • Corporate Governance and Nominating (Chair) • Audit | OUMA SANANIKONE Skills and Qualifications • Extensive financial and management background in investment banking and finance • Significant experience in strategic planning at both executive and board levels • Deep leadership experience in the finance and investment management sectors Current Public Company Directorships: • iA Financial Group (Toronto Stock Exchange) • Innergex Renewable Energy (Toronto Stock Exchange) • Gecina (Paris Stock Exchange) Ms. Sananikone was appointed as a director in August 2023 and as Lead Independent Director in October 2024. She has over 30 years in finance and investment management experience at both executive and board levels. Ms. Sananikone retired as Managing Director, Corporate Strategy & Development, of BT Financial Group/Westpac Banking Corporation in 2003. She served in various consulting roles from 2003 to 2006 and from 2005 to 2008 was an Honorary Australian Financial Services Fellow on behalf of the Government of Australia. From 2000 to 2001 she was the Chief Executive Officer of Aberdeen Asset Management PLC. She is currently serving on the boards of iA Financial Group, Innergex Renewable Energy, Inc., and Ivanhoe Cambridge, Inc. She previously served on the board of Hafnia Ltd from November 2019 to November 2023. She graduated with a B.A. in Economics and Political Science from Australian National University and holds a Masters of Commerce degree from New South Wales University. |
The Risk Committee
The Risk Committee The Risk Committee is responsible for broad oversight of risk, with the primary purpose of assisting the Board with its oversight of the Company’s level of risk, risk assessment and risk management in areas not otherwise addressed by other committees of the Board, including review of the health, safety, environmental and sustainability practices and policies of the Company. The Risk Committee is also responsible for review of controls around cybersecurity and incident responses, reviewing the Company’s information security budget and independent assessments of the Company’s information security programs, and reviewing the Company’s Cybersecurity Incident Response Plan. The current members of the Risk Committee are Messrs. Bates, Kelly and O’Leary, each of whom, other than Mr. O’Leary, the Board has determined are “independent” under SEC and Nasdaq rules. During 2024, the Risk Committee met four times.
The Risk Committee
| DMC GLOBAL INC. • 2025 PROXY STATEMENT | 11 |
The Risk Committee
| CORPORATE GOVERNANCE |
The Risk Committee
DMC is committed to sound principles of corporate governance. Our Board has adopted Corporate Governance Guidelines and other corporate governance policies that supplement certain provisions of our bylaws and relate to the composition, structure, interaction and operation of the Board of Directors. Our Board periodically, and at least annually, reviews and revises the Corporate Governance Guidelines and other policies, as appropriate, to ensure that they reflect our Board’s corporate governance objectives and commitments. Copies of our Corporate Governance Guidelines and other governance documents can be found on the “Governance – Governance Documents” page of the “Investors” section of our website at www.dmcglobal.com. You should review these documents for a complete understanding of these corporate governance practices, but some of the key elements of our strong governance policies and practices are summarized below:
2024 Compensation Decisions at a Glance
| | COMPENSATION ELEMENT | 2024 DESIGN PHILOSOPHY | | | • The Compensation Committee increased salaries by an average of 3% for Mr. Kuta, Mr. Walter, Ms. Shepston, Mr. Chilcoff, Mr. Grieves, and Mr. Nobili. • Effective November 13, 2024, the Compensation Committee approved an increase in our former Chief Legal Officer’s salary (Ms. Shepston) to more closely reflect market compensation. | • Changes to base salary consider level of responsibility and complexity of position, peer compensation levels, individual performance, market alignment and other factors | | | • Our Chief Financial Officer and former Chief Legal Officer received an increase in their target award opportunity to more closely reflect market compensation. No other changes were made for continuing NEOs. • Based on challenging conditions in U.S. construction and energy markets, our Compensation Committee approved a Company Performance Component achievement metric of 0% for DMC, Arcadia, and DynaEnergetics. Due to sales, SG&A, adjusted EBITDA, and cash conversion performance above target metrics, the Company Performance Component was approved at 121% for NobelClad. • Individual NEO (other than Mr. O’Leary’s) short-term incentive payouts ranged from 0% to 50% of target. Mr. Nobili, the leader of NobleClad earned total payout of 117% of target. | • Target awards set as a percentage of salary for each NEO • Weightings and metrics: DMC Global NEOs: • 50% Company Performance • 50% Individual Performance Business Segment NEOs: • 80% Company Performance • 20% Individual Performance • No payout on a metric if performance is below threshold; award capped at 180% of target | | | • The Compensation Committee maintained grants for Mr. Walter, Ms. Shepston, Mr. Chilcoff, Mr. Grieves, and Mr. Nobili at levels approximating 2023 levels. • Mr. Kuta’s LTI grant was agreed to as part of his offer letter as sole Chief Executive Officer. Mr. Kuta also received an LTI grant in recognition of his appointment as CEO in August 2023. All of Mr. Kuta’s LTI was forfeited upon his retirement in November 2024. • PSUs for the 2021 to 2023 performance period vested in February 2024 at 50% of target due to Adjusted EBITDA performance. | • Consists of time-based restricted stock or restricted stock units (RSUs) (one-half of target LTI value) and performance share units (PSUs) (one-half of target LTI value) • Restricted stock or RSUs vest over 3-year period based on continued service • PSUs vest at end of 3-year period based on metrics set at time of grant • Actual awards can range from 0% to 200% of target award • Metrics are solely based on Relative TSR |
2024 Transition Compensation
2024 Transition Compensation Maintaining stability and driving progress on key strategic priorities has been a critical priority amid the Company’s strategic initiatives and executive leadership transition. To support leadership continuity and ensure a competitive approach to recognizing and rewarding our executives during this time, the Compensation Committee, with support from its independent compensation consultant, evaluated market practices of similarly situated companies and made the following decisions: Executive Chairman and Interim CEO Compensation: Mr. O’Leary’s compensation was agreed to as part of the two leadership changes to Executive Chairman in October 2024 and to Interim President and Chief Executive Officer in November 2024. Upon his appointment to Executive Chairman in October 2024, the Board approved the following compensation elements for Mr. O’Leary for his service as the Company’s Executive Chairman: (i) a base salary of $500,000; (ii) a restricted stock grant with a grant date fair value of $1,000,000, to vest in full on the first anniversary of the grant date; and (iii) a restricted stock grant with a grant date value of $1,000,000, to vest 50% on the first and second anniversaries of the grant date, in each case, with respect to the restricted stock grants, subject to continued employment or service and the terms of the 2016 Omnibus Incentive Plan and applicable award agreements. Further, following his additional appointment to Interim President and CEO, the Board approved an additional cash incentive target award of $2,000,000 that will be earned based on achievement of performance milestones, including but not limited to: (i) the assumption of all critical pre-existing workstreams and relationships from the former Chairman of the Board and the former President and Chief Executive Officer of the Company, (ii) managing and engaging external parties on potential strategic alternatives or potential strategic capital solutions, respectively, and (iii) preparing and finalizing for Board review and approval individual business unit plans and budgets for each of the Company’s three business segments for fiscal 2025.
2024 Transition Compensation
Retention Agreements with Selected Senior Executives: On November 13, 2024, in order to reward, retain and further incentivize certain members of the leadership team and to continue to maintain a strong emphasis on long-term shareholder value creation, the Compensation Committee approved a special retention grant for each of (i) Eric Walter, Chief Financial Officer of the Company, and (ii) Michelle Shepston, Executive Vice President, Chief Legal Officer and Secretary of the Company, respectively (each, a “Retention Grant”). Each Retention Grant, which consists 50% of restricted stock and 50% of cash, has a grant date value equal to one times the respective officer’s base salary and will vest 18 months from the grant date, subject to the executive officer’s continued service. The restricted stock is also subject to the terms of the 2016 Omnibus Incentive Plan and a restricted stock award agreement, while the cash award is also subject to a cash retention letter agreement. Ms. Shepston forfeited her Retention Grant upon her resignation in March 2025.
PREVIEW OF 2025 COMPENSATION PROGRAM
PREVIEW OF 2025 COMPENSATION PROGRAM In furtherance of our focus on improving profitability and overall cash flow management, the Compensation Committee has approved two significant changes to the 2025 NEO compensation program. First, PSUs granted in 2025 to DMC, DynaEnergetics, and NobelClad NEOs will be based on 50% cumulative Adjusted EBITDA and 50% cumulative Adjusted Free Cash Flow performance compared to a pre-established goal over a three-year performance period. PSUs granted in 2025 to the Arcadia NEO will be based solely on cumulative Adjusted EBITDA performance compared to a pre-established goal over a two-year performance period. This is a change from 100% relative TSR for PSUs granted in 2024. Second, the 2025 Company Performance Component of the annual cash bonus for DMC, DynaEnergetics, and NobelClad NEOs will be based on cumulative achievement of Adjusted EBITDA and Adjusted Free Cash Flow. For the Arcadia NEO, the Company Performance Component will be based solely on Adjusted EBITDA. This is a change from the historical metrics of revenues, SG&A as a percentage of sales, adjusted EBITDA as percentage of sales, and cash conversion days. The Committee has also revised the allocations of total target award between the quantitative company performance component and the qualitative individual component. For all NEOs, the company performance component at target is 100% of the total bonus, and the qualitative individual component is no longer applicable. The relative weighting for the Company Performance Component in 2025 will be as follows for each segment:
Good Compensation Governance Practices
| WHAT WE DO | | WHAT WE DON’T DO | | | | Provide the majority of compensation in performance-based pay | | No “single-trigger” change of control severance benefits | | | Maintain robust stock ownership requirements | | No hedging transactions or pledging of our common stock by executive officers | | | Maintain a clawback policy | | No evergreen provision in the equity incentive plan | | | Use an independent compensation consultant engaged by the Compensation Committee | | No liberal share recycling | | | Conduct annual compensation program risk assessment | | No liberal definition of change of control | | | Limit perquisites | | No defined benefit plans for executive officers |
Elements of Executive Compensation
| | Compensation Component | Purpose | | | FIXED | Base salary Paid in cash | | Provide a competitive fixed rate of pay relative to similar positions in the market | | | | | Enable the Company to attract and retain critical executive talent | | AT RISK | Short-term incentives Paid in cash under the annual incentive plan | | Focus NEOs on achieving rigorous and progressively challenging short-term performance goals that align with the Company’s annual operating plan and result in long-term value creation | | | Long-term incentives Paid under the equity incentive plan using a mix of equity vehicles | | Focus NEOs on longer-term relative and absolute performance goals that strongly align with and drive stockholder value creation, as well as support the Company’s leadership retention strategy |
THE ROLE OF THE INDEPENDENT CONSULTANT
THE ROLE OF THE INDEPENDENT CONSULTANT The Compensation Committee engages an independent compensation consultant to assist the Committee in making compensation decisions for the NEOs. The Committee retained Pearl Meyer & Partners, LLC (“Pearl Meyer”) for 2024. The compensation consultant reviews the Company’s overall executive officer and director compensation in comparison to other comparably-sized public companies in industries similar to the Company, helps the Compensation Committee identify the appropriate mix of compensation components for compensating our executive officers, and facilitates the Compensation Committee’s determination of our executive officers’ incentive based compensation. The compensation consultant also keeps the Compensation Committee current with pay practices and governance trends, attends meetings when necessary to review reports and analyses and conducts special studies as may be required by the Compensation Committee from time to time. Pearl Meyer does not provide any other services to the Company or our management or have any other direct or indirect business relationships with us or our management other than to advise on board of director pay and practices. The Compensation Committee has assessed the independence of Pearl Meyer and concluded that its work does not raise any conflicts of interest.
THE ROLE OF MARKET REFERENCES AND THE PEER GROUP
THE ROLE OF MARKET REFERENCES AND THE PEER GROUP The Company competes across multiple industries to attract top executive-level talent. To ensure our compensation program remains competitive, the Compensation Committee conducts an annual evaluation of industry-specific and general market compensation practices and trends. This comprehensive approach provides a broader perspective than peer group data alone. The Compensation Committee also assesses the appropriateness of each NEO’s compensation, considering factors such as Company and business unit performance, job scope, individual performance, tenure, and other relevant criteria. Should the Compensation Committee determine that a NEO’s compensation is not aligned with these factors, adjustments to one or more compensation components may be made. The Compensation Committee does not target a specific pay level. Given the diversified industries in which our businesses operate, our 2024 peer group, as detailed below, continued to include companies from the building products, global industrial infrastructure, and upstream oil and gas and energy sectors. This peer group was utilized to set executive compensation levels for 2024 and remained consistent with the peer group utilized in 2023. Additionally, the S&P 600 Industrials index was employed for benchmarking relative performance for equity incentive awards.
2024 Peer Group
2024 Peer Group
2024 Peer Group
| Apogee Enterprises, Inc. | Expro Group Holdings N.V. | Hunting PLC | Quanex Building Products Corporation | | Axcelis Technologies, Inc. | Gibraltar Industries, Inc. | Matrix Service Company | Tennant Company | | CSW Industrials, Inc. | Helios Technologies, Inc. | Oil States International, Inc. | TETRA Technologies, Inc. | | Core Laboratories N.V. | Helix Energy Solutions Group, Inc. | PGT Innovations, Inc. | Thermon Group Holdings, Inc. | | Dril-Quip, Inc. | | | |
2024 Peer Group
| DMC GLOBAL INC. • 2025 PROXY STATEMENT | 35 |
Annual Incentives
Annual Incentives The annual incentive plan provides our NEOs the opportunity awards depend on the achievement of company performance objectives and a qualitative assessment of individual performance and can range from 0% to 180% of target award. Target annual bonus opportunities are expressed as a percentage of base salary and were established by the NEO’s level of responsibility and his or her ability to impact overall results and market practices for each position. Target award opportunities as a percentage of base salary for each NEO are as follows:
Annual Incentives
| NEO | 2024 Target Award Opportunity (as a % of base salary) | | Michael Kuta | 100% | | James O’Leary | (1) | | Eric Walter | 75% | | Michelle Shepston | 75% | | James Chilcoff | 75% | | Ian Grieves | 60% | | Antoine Nobili | 40% |
Annual Incentives
| (1) Mr. O’Leary’s incentive cash compensation is based on target goals and transition services as defined in his Interim President and CEO offer letter. His target incentive cash compensation is $2,000,000, which is 400% of his base salary. See “Other Bonus Agreements.” |
Annual Incentives
The annual incentive plan for NEOs consists of a quantitative company performance component and a qualitative individual component. For Messrs. Kuta and Walter and Ms. Shepston, the company performance component at target is 50% of the total bonus, and the qualitative individual component is 50%. For Messrs. Chilcoff, Grieves and Nobili, the company performance component at target is 80% of the total bonus, and the qualitative individual component is 20%. Mr. O’Leary did not participate in the annual incentive plan for 2024, but did receive a cash bonus as a result of target goals and transition services performed in accordance with his Interim President and CEO offer letter. See “Other Bonus Agreements.”
OVERALL RESULTS
| (1) Mr. Kuta’s and Mr. Chilcoff’s employment terminated prior to December 31, 2024 and as such, no bonus for 2024 was earned. |
Other Bonus Agreements
Other Bonus Agreements The Board appointed James O’Leary as Interim President and CEO, effective as of November 29, 2024. On December 11, 2024, the Company entered into a letter agreement (the “Agreement”) with respect to Mr. O’Leary’s service in such role. The Agreement provides that Mr. O’Leary will be eligible for certain cash payments in the aggregate target amount of $2,000,000. The actual amount of such payments will be determined based on, as applicable, completion of targets or performance of certain ongoing transition services as follows:
Other Bonus Agreements
| • | Assume all critical pre-existing workstreams and relationships underway from former Chairman of the Board and current President and Chief Executive Officer including, but not limited to, the recently terminated strategic review process regarding DynaEnergetics and NobelClad businesses. | | • | Manage and engage external parties on potential strategic alternatives both currently underway and that may arise. | | • | Complete and present necessary amendments to the Credit Facility and/or obtain an amendment to the Arcadia operating agreement to delay exercisability of the put option. | | • | Manage and engage external financing parties on potential strategic capital solutions that the Board may consider, including the existing lender group. | | • | Review any capital allocation initiatives that may require Board approval, including (but not limited to) NobelClad India, and each business unit’s capital plan. | | • | Prepare and finalize for Board review and approval the individual business unit plans and budgets for Arcadia Products, NobelClad and DynaEnergetics for fiscal 2025. | | • | Assume responsibilities as Chairman of the Arcadia Products, LLC board and engage with members of Arcadia Products, LLC, as appropriate. | | • | Assist the Corporate Governance and Nominating (CG&N) Committee with searches for potential candidates, with timing as directed by the CG&N Committee, to fill the roles of Company President and Chief Executive Officer and President of Arcadia Products. |
Other Bonus Agreements
As of December 31, 2024, the Compensation Committee determined that Mr. O’Leary had satisfied all target goals and was satisfactorily progressing through the ongoing transition services. As of December 31, 2024, Mr. O’Leary was not paid any of the $2,000,000 aggregate target amount achieved but had earned $1,270,696 assuming continued employment through June 30, 2025. The Compensation Committee will continue to review the performance of the ongoing transition services bimonthly until June 30, 2025.
Long-Term Equity Incentives
Long-Term Equity Incentives The Compensation Committee believes that long-term equity incentive grants are important in aligning executives with the long-term performance of the Company. For 2024, the Committee set target long-term incentive grants for each NEO. Awards were granted using a mix of RSUs and PSUs. Per the terms of Mr. Kuta’s offer letter upon appointment as CEO in August 2023, he was to receive a pro-rated long-term incentive grant in recognition of his service in fiscal 2023, which included both restricted stock and PSUs. This award was granted on March 6, 2024 and is included in the 2024 Summary Compensation Table. Restricted Stock/RSUs. Restricted stock vests over a three-year period with one-third of such shares vesting on each of the first, second and third anniversaries of the grant date. RSUs are granted to non-US NEOs and vest over a three-year period. RSUs granted to Mr. Grieves vest on each of the first, second and third anniversaries of grant. RSUs granted to Mr. Nobili vests two-thirds on the second anniversary of grant and one-third on the third anniversary of grant. Each RSU represents the right to receive one share of the Company’s stock upon vesting.
Long-Term Equity Incentives
| DMC GLOBAL INC. • 2025 PROXY STATEMENT | 39 |
Long-Term Equity Incentives
PSUs. PSUs are performance-based equity awards that provide for payouts that can range from 0% to 200% of the target number of PSUs granted based on relative TSR results over a three-year period (Performance Period). Each earned PSU represents the right to receive one share of the Company’s common stock. The PSUs earned, if any, will cliff vest on the third anniversary of grant based on the degree of satisfaction of the PSU performance conditions. The actual number of PSUs earned and vested over the Performance Period is dependent on the Company’s percentile ranking of TSR performance relative to the S&P SmallCap 600 Industrials index as detailed in the following payout schedule.
Long-Term Equity Incentives
| 2024 PSU Payout Schedule | | | Percentile Rank | Payout Percentage | | 100th | 200% | | 75th | 150% | | 50th | 100% | | 25th | 50% | | 0th | 0% |
Long-Term Equity Incentives
The Compensation Committee established target LTI awards for each NEO. The number of shares or units is calculated based on the LTI targets and the closing price of the Company’s stock on the day prior to grant date. The table below shows the equity awards granted under the 2016 Omnibus Incentive Plan (the “2016 Plan”) for each of the NEOs:
Long-Term Equity Incentives
| NEO | Grant Date | Restricted Stock/RSUs | PSUs(1) | Grant Date Value(2) | | Michael Kuta | February 28, 2024 | 57,110 | 57,110 | $2,388,911 | | | March 6, 2024(3) | 23,796 | 23,796 | $972,067 | | James O’Leary | May 15, 2024(4) | 9,520 | – | $124,998 | | | November 1, 2024(5) | 198,216 | – | $2,000,000 | | Eric Walter | February 28, 2024 | 19,503 | 19,503 | $815,811 | | | November 13, 2024(6) | 26,119 | – | $227,496 | | Michelle Shepston | February 28, 2024 | 10,336 | 10,336 | $432,354 | | | November 13, 2024(6) | 22,560 | – | $196,498 | | James Chilcoff | February 28, 2024 | 12,984 | 12,984 | $670,075 | | Ian Grieves | February 28, 2024 | 13,392 | 13,392 | $560,187 | | Antoine Nobili | February 28, 2024 | 3,455 | 3,455 | $144,523 |
Long-Term Equity Incentives
| (1) Number of PSUs granted assuming target performance achieved. | | (2) See footnote 1 to Summary Compensation Table for an explanation of calculation. | | (3) Per the terms of Mr. Kuta’s offer letter upon appointment as CEO in August 2023, he received a pro-rated long-term incentive grant in recognition of his service in fiscal 2023, which included both restricted stock and PSUs subject to the standard vesting conditions discussed above. | | (4) Relates to annual grant in recognition of service on the Board of Directors. Mr. O’Leary was appointed as Executive Chairman on October 16, 2024 and Interim President and CEO effective November 29, 2024. | | (5) As compensation for Mr. O’Leary’s service as Executive Chairman, Mr. O’Leary received (i) a restricted stock grant with a grant date fair value of $1,000,000, to vest in full on the first anniversary of the grant date; and (ii) a restricted stock grant with a grant date value of $1,000,000, to vest 50% on the first and second anniversaries of the grant date. | | (6) Mr. Walter and Ms. Shepston received a retention grant valued at one-half their then-current salary. Each award will cliff vest on the 18-month anniversary of grant. |
VESTING OF PRIOR AWARDS
VESTING OF PRIOR AWARDS PSUs granted on February 23, 2021 achieved 200% of the pre-established three-year performance goal for Adjusted EBITDA; however, the PSUs failed to achieve the three-year relative TSR performance as the Company’s TSR was below the lowest quartile. As the Adjusted EBITDA awards were 25% of the target grant in 2021, 50% of the target PSUs vested for Ms. Shepston and Messrs. Grieves and Nobili.
Clawback Policy
Clawback Policy Our clawback policy requires the Board to recoup certain executive compensation in the event of an accounting restatement resulting from material noncompliance with financial reporting requirements under the federal securities laws. The policy covers all the Company’s current and future NEOs and applies to incentive compensation paid by the Company (annual bonuses and other short-term and long-term incentives, restricted stock and other equity awards).
Risk Assessment and Mitigation of Compensation Policies and Practices
Risk Assessment and Mitigation of Compensation Policies and Practices Our Compensation Committee, with the assistance of management, reviews on an annual basis our compensation programs and considers whether they encourage excessive risk-taking by employees at the expense of long-term Company value. The Committee believes that the design of our executive compensation program, which includes a mix of annual and long-term incentives (a substantial portion of which are performance based) and cash and equity awards, along with our stock ownership guidelines and clawback policy, provide an appropriate balance between risk and reward and do not motivate imprudent risk-taking. As a result, we do not believe that our compensation policies are reasonably likely to have a material adverse effect on the Company.
Compensation Committee
| SUMMARY COMPENSATION TABLE FOR FISCAL YEAR 2024 |
Compensation Committee
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | Total ($) | | Michael Kuta | 2024 | $657,288 | $– | $3,360,978 | $– | $119,859(3) | $4,138,125 | | Former Chief Executive Officer(2) | 2023 | 613,461 | – | 599,993 | 703,701 | 67,499 | 1,984,654 | | | 2022 | 400,000 | – | 713,198 | 311,952 | 41,848 | 1,466,998 | | James O’Leary Executive Chairman and Chief Executive Officer(4) | 2024 | 92,308 | – | 2,124,998 | 1,270,696(5) | 59,420(6) | 3,547,422 | | Eric Walter | 2024 | 455,000 | 177,778(7) | 1,043,307 | 170,625 | 44,222(8) | 1,890,932 | | Chief Financial Officer | 2023 | 406,154 | – | 1,591,710 | 276,749 | 73,338 | 2,347,951 | | Michelle Shepston(9) | 2024 | 397,273(10) | – | 628,852 | 163,125 | 33,159(11) | 1,222,409 | | Former Executive Vice President, Chief Legal Officer and Secretary | 2023 | 380,000 | – | 419,861 | 237,241 | 39,535 | 1,076,637 | | | 2022 | 350,000 | – | 378,201 | 181,972 | 38,468 | 948,641 | | James Chilcoff | 2024 | 448,800 | – | 670,075 | – | 331,255(13) | 1,450,130 | | Former President, Arcadia(12) | 2023 | 550,000 | 420,000 | 939,841 | 444,807 | 31,200 | 2,385,848 | | Ian Grieves | 2024 | 428,136(15) | 108,200(16) | 560,187 | – | 35,458(17) | 1,131,981 | | President and General Manager, DynaEnergetics(14) | 2023 | 410,000 | – | 539,778 | 155,291 | 32,860 | 1,137,929 | | | 2022 | 386,313 | 99,989 | 378,201 | 292,400 | 33,309 | 1,190,212 | | Antoine Nobili(18) President, NobelClad | 2024 | 222,885 | 108,200 | 144,523 | 104,067 | 112,571(19) | 692,246 |
Compensation Committee
| GRANTS OF PLAN-BASED AWARDS |
ANTOINE NOBILI
| OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2024 |
ANTOINE NOBILI
| STOCK VESTED DURING 2024 |
ANTOINE NOBILI
| NON-QUALIFIED DEFERRED COMPENSATION |
ANTOINE NOBILI
| POTENTIAL PAYMENTS UPON TERMINATION |
ANTOINE NOBILI
| | James O’Leary | | | Executive Benefits and Payments upon Termination of Employment | Involuntary Termination without Cause(1) | Death or Disability(2) | | COMPENSATION: | | | | Base Salary | $250,000(3) | $– | | Incentive Bonus | $2,000,000(4) | $– | | Acceleration of vesting of Restricted Stock(13) | $1,526,860(5) | $1,526,860(6) | | TOTAL | $3,776,860 | $1,526,860 |
ANTOINE NOBILI
| | Eric Walter | | | Executive Benefits and Payments upon Termination of Employment | Involuntary Termination without Cause(1) | Death or Disability(2) | | COMPENSATION: | | | | Base Salary | $455,000(7) | $– | | Incentive Bonus | $– | $– | | Acceleration of vesting of Restricted Stock(13) | $669,533(5) | $669,533(6) | | TOTAL | $1,124,533 | $669,533 |
ANTOINE NOBILI
| | Michelle Shepston | | | Executive Benefits and Payments upon Termination of Employment | Involuntary Termination without Cause(1) | Death or Disability(2) | | COMPENSATION: | | | | Base Salary | $435,000(8) | $– | | Incentive Bonus | $– | $– | | Acceleration of vesting of Restricted Stock(13) | $482,279(5) | $482,279(6) | | TOTAL | $917,279 | $482,279 |
ANTOINE NOBILI
| | Ian Grieves | | | Executive Benefits and Payments upon Termination of Employment | Involuntary Termination without Cause(1) | Death or Disability | | COMPENSATION: | | | | Base Salary | $213,500(9) | $106,750(10) | | Incentive Bonus | $128,100(9) | $64,050(10) | | Acceleration of vesting of Restricted Stock(13) | $390,300(5) | $390,300(6) | | TOTAL | $731,900 | $561,100 |
ANTOINE NOBILI
| | Antoine Nobili | | | Executive Benefits and Payments upon Termination of Employment | Involuntary Termination without Cause(1) | Death, Disability, Retirement | | COMPENSATION: | | | | Base Salary | $485,104(11) | $111,448(12) | | Incentive Bonus | $– | $52,033(12) | | Acceleration of vesting of Restricted Stock(13) | $108,772(5) | $108,772(6) | | TOTAL | $593,876 | $272,253 |
ANTOINE NOBILI
| PAY VERSUS PERFORMANCE |
ANTOINE NOBILI
| | | Value of Initial Fixed $100 Investment based on: | | | | | Year | Average Compensation Actually Paid to Non-CEO NEOs ($)(3, 4) | DMC Global Inc. Total Stockholder Return(5) | Peer Group Total Stockholder Return(6) | Net (Loss) Income (thousands) ($)(7) | Adjusted EBITDA (thousands) ($)(8) | | 2024 | $497,541 | $16.36 | $250.65 | $(151,960) | $52,156 | | 2023 | 1,552,866 | 41.88 | 199.12 | 34,759 | 96,063 | | 2022 | 957,644 | 43.26 | 128.35 | 13,833 | 74,199 | | 2021 | 910,996 | 88.14 | 189.83 | (1,010) | 20,179 | | 2020 | 650,352 | 96.24 | 148.88 | (1,412) | 19,147 |
ANTOINE NOBILI
| (2) As determined in accordance with SEC rules, “compensation actually paid” to our CEOs in each of 2024, 2023, 2022, 2021 and 2020 reflects the respective amounts set forth in the table above, adjusted as set forth in the table below, and is calculated as of each year-end. The dollar amounts reflected for “Compensation actually paid” in the table above do not reflect the actual amount of compensation earned by or paid to our CEOs during the applicable year, as this depends on the factors discussed in CD&A. For information regarding the decisions made by our Compensation Committee in regard to the CEO’s compensation for each fiscal year, please see the CD&A sections of the proxy statements reporting pay for the fiscal years covered in the table above. |
CAP vs. Adjusted EBITDA
| DIRECTOR COMPENSATION |
CAP vs. Adjusted EBITDA
| Non–employee Director | Fees Earned or Paid in Cash(1) | Stock Awards(2) | All Other Compensation | Total | | David C. Aldous(3) | $125,000 | $124,998 | $– | $249,998 | | Simon M. Bates(4) | $39,148 | $59,996 | $– | $99,144 | | Richard P. Graff(5) | $27,816 | $– | $– | $27,816 | | Ruth I. Dreessen | $95,000 | $124,998 | $– | $219,998 | | Robert A. Cohen(5) | $33,379 | $– | $– | $33,379 | | Michael A. Kelly | $88,146 | $124,998 | $– | $213,144 | | Clifton Peter Rose(6) | $85,000 | $124,998 | $– | $209,998 | | Ouma Sananikone | $81,291 | $124,998 | $– | $206,289 |
STOCK OWNERSHIP GUIDELINES FOR NON-EMPLOYEE DIRECTORS
| CEO PAY RATIO FOR FISCAL YEAR 2024 |
STOCK OWNERSHIP GUIDELINES FOR NON-EMPLOYEE DIRECTORS
| Summary Compensation Table Component | Compensation for CEO Pay Ratio | Explanation | | Salary | $500,000 | Annualized salary. The actual salary paid in 2024 was $92,308, as disclosed in the SCT. | | Bonus | $– | Mr. O’Leary had no compensation attributable to Bonus during 2024. | | Stock Awards | $2,000,000 | Includes only stock awards granted for service as Executive Chairman and Interim President and CEO. Excludes $124,998 of grants for service as a Director. | | Non-Equity Incentive Plan Compensation | $1,270,696 | Same value as SCT, since non-equity incentive plan compensation was made due to Interim President and CEO transition. | | Severance | $– | Mr. O’Leary had no compensation attributable to severance during 2024. | | All Other Compensation | $15,159 | Company matching contributions under the Company’s 401(k) plan and insurance premium payments are annualized for Mr. O’Leary’s base salary in effect on October 16, 2024. | | TOTAL | $3,785,855 | |