Douglas Kaye III
About Douglas Kaye III
Douglas A. “Dak” Kaye III (age 56) became CEO of American Vanguard (AVD) in December 2024 after 13 years in senior roles at Albaugh (President North America; Group Chief Commercial Officer; President Europe). He holds a Masters of Accountancy and BS in Business Administration from Auburn University and began his career at Arthur Andersen; he was recently elected to the Executive Board of CropLife America (CLA) . He enters amid a turnaround: in 2024 AVD reported net sales of $549.5M and a net loss of $124.9M, with cumulative TSR value of $24 (from a $100 base) at year-end, highlighting the urgency behind the Company’s transformation and EBITDA expansion goals .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Albaugh LLC | President, North America | 2022–2024 | Led Albaugh’s largest region; commercial accountability and growth execution across U.S./Canada . |
| Albaugh LLC | Group Chief Commercial Officer | 2019–2021 | Oversaw commercial activities across North America, Europe, Brazil, Argentina, and LATAM . |
| Albaugh LLC | President, Europe | 2011–2019 | Ran European region for seven years; multi-country commercial and operational leadership . |
| Adama (non‑crop subsidiary) | CFO and Director | n/a | Senior finance and governance responsibilities within crop protection adjacency . |
| International automotive logistics company | Co‑CEO | n/a | P&L and operational leadership in logistics sector . |
| Arthur Andersen LLP | Auditor | Career start | Foundation in accounting/controls; Big 5 experience . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| CropLife America (CLA) | Executive Board | 2024–present | Elected to Executive Board, enhancing industry network and policy visibility . |
| Public company directorships (past 5 yrs) | None | — | Company states none over prior five years . |
Fixed Compensation
| Element | Terms | Source |
|---|---|---|
| Base Salary | $650,000 per year | |
| 2024 Salary Paid | $39,583 (Dec 9–Dec 31, 2024 partial period) | |
| Target Annual Cash Bonus (STI) | 100% of base (maximum 180%) | |
| Sign‑on/Retention Bonus | $300,000 total: $200,000 at end of Q1’25; $100,000 at end of Q4’25 | |
| Life Insurance | $1.5M term policy (Company‑paid) | |
| Car Allowance | $2,500 per month | |
| Travel/Lodging Stipend | $12,500 per month for first 2 years (commuting Iowa–CA), first two months advanced |
Performance Compensation
2025 Short‑Term Incentive (STI) Design (CEO)
| Metric | Weight | Target/Payout Mechanics | Notes |
|---|---|---|---|
| Adjusted EBITDA | 50% | Formula grid with Levels 1–6; payout 0% to 180% of target | CEO target = 100% of salary; cap at 180% of target . |
| Net Sales | 20% | Same multi‑level grid | . |
| Net Trade Working Capital | 20% | Same multi‑level grid | . |
| Transformation Execution | 5% | Same multi‑level grid | . |
| Manufacturing/Opex | 5% | Same multi‑level grid | . |
2024 outcome: No NEO cash bonuses were paid given performance thresholds not met; CEO’s 2024 cash bonus = $0 .
2024 CEO Equity Awards (granted Dec 9, 2024)
| Award Type | Shares/Units | Vesting / Performance Conditions | Valuation Detail |
|---|---|---|---|
| Performance‑based RS (Relative TSR vs Russell 2000) | 59,003 | Vests on 1st, 3rd, 5th anniversaries based on TSR percentile: 50%/100%/200% at ≥25th/≥50th/≥75th percentiles; service required | Valued $4.17 per unit . |
| Performance‑based RS (Price‑hurdle PSUs) | 118,007 | Two‑step vesting per price hurdles: one‑sixth vests when FMV ≥ 2x, 3x, 4x $5.72 for 20 consecutive days; an additional one‑sixth 12 months after each trigger, service required | Valued $1.11 per unit . |
| Time‑based RS | 59,003 | Vests in 5 equal annual tranches (years 1–5) | Valued $5.72 per unit . |
| Time‑based RS (additional) | 52,448 | Vests in 5 equal annual tranches (years 1–5); special acceleration if terminated without cause in first 12 months | Valued $5.72 per unit . |
- Company shifted to stronger TSR emphasis in 2024, with price‑hurdled equity also used for other NEOs; CEO package uses relative TSR and absolute price hurdles to align with shareholder outcomes .
Equity Ownership & Alignment
- Unvested Stock Awards (12/31/24): 288,461 units; market value $1,335,574 at $10.97 closing price .
- Beneficial Ownership: CEO not listed in April 5, 2025 beneficial ownership table (under 1% of shares outstanding) .
- Ownership Guidelines: CEO required to hold shares = 4x base salary; Section 16 officers = 2x; directors must accumulate four years’ worth of stock awards; compliance status for CEO not disclosed .
- Anti‑Hedging/Pledging: Company prohibits hedging and holding Company securities in margin accounts for directors and Section 16 officers (reduces pledge/derisking misalignment) .
- Clawback: Recoupment of excess incentive comp for 3 fiscal years preceding any material restatement .
Employment Terms
| Topic | Key Terms |
|---|---|
| Start Date / Role | Appointed CEO effective Dec 9, 2024 . |
| Termination (within first 12 months) | If terminated without cause or resigns for good reason (not death/disability): accrued pay, pro‑rated bonus, acceleration of the specific time‑based RS award (the $300k grant), plus 12 months of base salary and annual bonus value; benefits per agreement . |
| Termination (after first 12 months) | Lump sum = 2x (base + average bonus over 3 years), pro‑rated bonus for year of termination, COBRA premiums up to 12 months, up to $10k outplacement; pro‑rated acceleration of equity (target for PSUs); single‑trigger acceleration only if combined with termination in a CoC period (double‑trigger) . |
| Change‑in‑Control (double‑trigger) | If terminated without cause/for good reason during CoC period: full acceleration of equity at target for PSUs; severance terms per above . |
| Estimated CoC Payments (as of 12/31/24, illustrative) | Salary $1,299,984; Average Bonus $251,432; COBRA $64,650; Outplacement $10,000; Accelerated Equity $1,335,574; Total $2,961,640 . |
| Non‑Compete | Agreement explicitly states it should not be construed as a non‑competition covenant; confidentiality, conflict‑of‑interest, arbitration, and cooperation clauses apply . |
Board Governance
- Board Service: Kaye is nominated for election to the Board for the first time via the 2025 proxy (serving as CEO and director) .
- Independence: Board determined 7 of 9 nominees are independent; exceptions are Kaye (CEO) and Bassett (consulting services in 2024) .
- Dual‑Role Implications: Roles of Chair and CEO are now separated (former CEO Wintemute served as Chair/CEO; lead independent director Scott Baskin sets agendas and presides over executive sessions). The Board intends to keep Chair/CEO segregated going forward, supporting governance independence .
- Committees: CEO/director is not listed as serving on board committees; independent directors chair Audit (Macicek), Compensation (Angelini), Nominating & Corporate Governance (Gunter), Finance (Bassett), Risk (Baskin) .
Director Compensation
- Management directors (CEO) do not receive separate director fees; non‑management directors receive $60,000 cash retainer plus $80,000 annual equity, with additional committee/lead premiums; director awards vest immediately at grant .
Compensation Context, Peer Benchmarking, and Say‑on‑Pay
| Item | Details |
|---|---|
| Peer Group (14 “Proxy Peers”) | ASIX, ALTM, ASPN, BCPC, CMT, UAN, ECVT, HWKN, HAYN, IOSP, IPI, LXU, KWR, TG . |
| Peer Medians | Revenues $706M; Market Cap $926M; EV $1,305M . |
| CEO Benchmark Positioning (annualized, 2024) | Base below 25th percentile; bonus (0) and total cash below 25th; equity between 25th and median; total direct comp below 25th percentile of peers . |
| Say‑on‑Pay Results | Last three years average ~89% approval; 2024 93%, 2023 91%, 2022 83% (contested proxy) . |
Performance & Track Record
| Year | Cumulative TSR (Value of $100) | Net Income ($000s) | Net Sales ($000s) |
|---|---|---|---|
| 2024 | 24 | (124,855) | 549,520 |
| 2023 | 72 | 7,519 | 579,371 |
| 2022 | 141 | 27,404 | 609,615 |
- 2024 compensation was aligned to performance: no STI paid to NEOs; CEO equity uses TSR and absolute price hurdles to drive shareholder alignment .
Risk Indicators & Red Flags
- Clawback policy; no tax gross‑ups; double‑trigger CoC; hedging/margin prohibitions (alignment‑friendly) .
- Related party transactions: None involving Kaye; director Mark Bassett provided consulting services and received compensation, overseen under related‑party review policies .
- Material weakness remediation referenced among risk factors (enterprise risk oversight includes cyber, transformation execution, and underperformance vs peers) .
Investment Implications
- Strong pay‑for‑performance tilt: 2025 STI is 50% on adjusted EBITDA with a 180% cap; equity is heavily performance‑linked (relative TSR and absolute price hurdles), aligning payouts to both operational improvement and stock appreciation .
- Retention secured but measured: modest cash sign‑on and commuting support reduce near‑term flight risk; severance is market‑standard (double‑trigger CoC, no gross‑ups) and includes pro‑rated equity acceleration (limits windfall) .
- Insider selling pressure appears contained: vesting is staggered (5‑year tranches), and price‑hurdled PSUs require sustained price thresholds (20 consecutive trading days) with additional 12‑month deferrals; hedging/margin bans further reduce misalignment risk .
- Governance optics: CEO is non‑independent director but Chair/CEO roles are separated and a strong lead independent director model is in place; say‑on‑pay support is robust and peer benchmarking shows below‑median pay, lowering pay inflation risk .
- Execution watch‑items: Company aims to drive EBITDA margin to 15% post‑transformation; 2024 results and recent TSR underscore the need for delivery on working capital reduction, manufacturing/opex control, and transformation milestones embedded in incentives .