Clay Smith
About Clay Smith
Clay Smith is General Counsel and Corporate Secretary of Arq, designated an executive officer for Section 16 purposes on April 26, 2024; he has been with Arq’s portfolio of companies since 2014 and is age 44 . He holds a B.A. in History from Colby College and a J.D. from Tulane University; prior to Arq he was an Associate at Troutman Sanders LLP for six years focused on infrastructure, telecom, and construction . Company performance during 2024 included cumulative TSR of 114.35 (vs 45.02 in 2023; 36.71 in 2022) and net loss of $5.109 million (vs $12.249 million in 2023; $8.917 million in 2022); the 2024 STIP achieved approximately 75% of targets company‑wide .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Arq (portfolio of companies) | Roles of increasing responsibility; now General Counsel & Corporate Secretary | Since 2014 | Built internal legal capability; supports governance, disclosure, financing and corporate transactions . |
| Troutman Sanders LLP | Associate | 6 years | Legal work across infrastructure, telecom, and construction industries, relevant to Arq’s industrial footprint . |
External Roles
None disclosed in company filings for public company boards or external committee roles for Smith .
Fixed Compensation
| Component | Detail |
|---|---|
| Base salary | $320,000 annually . |
| Target annual bonus (STIP) | 50% of base salary; must be actively employed (unless released without cause) to be eligible . |
| Long‑term incentive (LTIP) target | 65% of base salary, subject to plan terms and award agreements . |
| Benefits/PTO | Standard employee benefits; unlimited paid time off . |
Performance Compensation
- Annual STIP structure and 2024 metrics: Adjusted EBITDA, gross margin, SG&A as % of revenue, overall equipment efficiency, commissioning milestones, and TRIR; Compensation Committee determined ~75% of 2024 targets were achieved and approved payouts in line with that determination (company‑wide) .
- LTIP design: Company practice grants a mix of RSAs and PSUs; 2024 PSU awards vest after three years based on relative TSR vs a designated peer group with payout schedule: 50% at 30th percentile, 100% at 50th, 125% at 65th, and 200% at 90th percentile or higher .
- Note: Individual 2024 grant amounts and vesting schedules for Clay Smith were not disclosed; the above reflects company program design .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 46,469 common shares as of Form 3 (executive officer designation date 4/26/2024) . |
| Ownership guidelines | Executives are encouraged to own stock equal to at least 1x annual base salary (company guidelines); compliance status disclosed only for NEOs as of 12/31/2024 . |
| Hedging/pledging | Company insider trading policy prohibits hedging, short sales, derivatives, holding in margin, or pledging shares; imposes blackout windows and pre‑clearance for Access Persons . |
| 10b5‑1 plans | Allowed with pre‑approval, good‑faith adoption, and SEC cooling‑off period compliance . |
Employment Terms
| Term | Key provisions |
|---|---|
| Agreement effective date | April 26, 2024 . |
| At‑will employment | Employment is at‑will (either party may terminate) . |
| Severance (no CIC): termination without Cause or for Good Reason | 12 months base salary (paid on payroll schedule); year‑of‑termination STIP bonus based on actual Company performance; accelerated vesting of all unvested RSAs; PSUs vest based on actual performance through termination date (delivered in stock, net of taxes, within 60 days of termination and after release); lump‑sum equal to 12 months COBRA premiums at prior election level . |
| Severance (within 12 months after Change‑in‑Control) | Same economic package as above (12 months base, year‑of STIP, RSA acceleration, PSUs at actual performance to termination date, 12 months COBRA), triggered by termination without Cause or resignation for Good Reason within 12 months post‑CIC (double‑trigger) . |
| Definitions | “Cause,” “Good Reason,” and “Change in Control” definitions included (e.g., Good Reason includes reductions in base/target bonus, material breach, or material diminution of title/authority or reporting) . |
| Notice/administration | Written notice and opportunity to cure for certain Cause/Good Reason situations; 45‑day notice period for other terminations (with pay through notice period) . |
| Non‑compete / Non‑solicit | No explicit non‑compete or non‑solicit provisions disclosed in the employment agreement sections filed; confidentiality and IP/invention assignment obligations apply and persist post‑employment . |
| Clawback | Subject to Company’s clawback policy adopted under SEC/Nasdaq rules; agreement authorizes recovery and offsets; company‑wide clawback policy referenced and separately adopted . |
| Insider Trading | Subject to Company insider trading/blackout/pre‑clearance policy . |
| Notice to future employer | Executive must provide notice of the agreement to prospective employer at least 10 days before accepting an offer . |
Investment Implications
- Alignment and selling pressure: Equity is a meaningful portion of target comp (LTIP target 65% of salary), governed by a relative‑TSR PSU design and RSA time‑based vesting, with a robust clawback, ownership encouragement, and prohibitions on hedging/pledging—factors that support alignment and reduce near‑term forced selling, though individual grant sizes for Smith are undisclosed .
- Retention risk: Double‑trigger CIC protection and 12‑month severance (plus equity vesting mechanics and COBRA) provide moderate retention and orderly transition economics; absence of an explicit non‑compete increases mobility risk relative to peers that impose post‑employment restraints .
- Pay‑for‑performance context: 2024 STIP payout calibration at ~75% of targets and the three‑year relative TSR LTIP structure indicate an emphasis on operational and shareholder outcomes; Say‑on‑Pay support of ~84% in 2024 suggests shareholders broadly approve of the compensation framework .
- Company performance backdrop: TSR improved meaningfully in 2024 alongside a smaller net loss versus 2023, which can enhance realized value of outstanding equity awards and the perceived effectiveness of governance and legal risk management overseen by the General Counsel’s office .