Timothy Donnelly
About Timothy Donnelly
Timothy J. Donnelly (age 65) is Chief Information Officer, General Counsel & Secretary of American Vanguard (AVD); he joined AVD in 2005, became Secretary in 2007, assumed HR and Risk in 2009, served as Chief Administrative Officer since 2010, and added CIO in June 2024. He was designated Acting CEO and principal executive officer on July 12, 2024 during the Office of CEO transition . Previously, he was VP, General Counsel & Secretary at DDi Corp. (2000–2005) . Company performance over 2022–2024 shows net sales fell from $609.6M to $549.5M and net income turned to a $124.9M loss; cumulative TSR value of an initial $100 fell to $24 in 2024, underscoring pay-for-performance outcomes (no cash bonuses to NEOs) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| American Vanguard (AVD) | VP, General Counsel & Assistant Secretary | 2005–2007 | Established legal function; appointed Secretary in 2007 |
| American Vanguard (AVD) | Secretary; HR and Risk oversight | 2007–2009 | Expanded remit to Human Resources and Risk Management in 2009 |
| American Vanguard (AVD) | Chief Administrative Officer | 2010–June 2024 | Led administration through multi-year transformation initiatives |
| American Vanguard (AVD) | Chief Information Officer, General Counsel & Secretary | June 2024–present | Chairs Cyber & Privacy Risk Steering Committee; leads cybersecurity program governance |
| American Vanguard (AVD) | Acting CEO (within OCEO) | July 12, 2024–Dec 9, 2024 | Stabilized execution and accelerated transformation during CEO transition |
| DDi Corp. | VP, General Counsel & Secretary | 2000–2005 | Led legal at a high-tech PCB manufacturer |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 346,785 | 362,214 | 362,866 |
| Perquisites – Auto Allowance ($) | 18,000 | 18,000 | 18,000 |
| Insurance Premiums ($) | 1,530 | 1,530 | 1,545 |
| Company 401(k) Contributions ($) | 15,250 | 16,500 | 17,250 |
| All Other Compensation ($) | 34,780 | 36,030 | 286,795 (includes $250k OCEO transformation benefit) |
Notes:
- No cash incentive was paid to NEOs for 2023 or 2024 due to performance shortfalls .
Performance Compensation
| Element | Metric | Weighting | Target | Actual (FY 2024) | Payout | Vesting |
|---|---|---|---|---|---|---|
| Annual STI (2024 plan) | Adjusted EBITDA | 60% | Not disclosed | Threshold not met | 0 | N/A |
| Annual STI (2024 plan) | Net Sales | 20% | Not disclosed | Below targets | 0 | N/A |
| Annual STI (2024 plan) | Operating Expenses (NTE) | 20% | Not disclosed | Below targets | 0 | N/A |
| Annual STI (2025 plan) | Adjusted EBITDA | 50% | Graded scale | In-progress | TBD | Formula-driven |
| Annual STI (2025 plan) | Net Sales | 20% | Graded scale | In-progress | TBD | Formula-driven |
| Annual STI (2025 plan) | Net Trade Working Capital | 20% | Graded scale | In-progress | TBD | Formula-driven |
| Annual STI (2025 plan) | Transformation Execution | 5% | Graded scale | In-progress | TBD | Formula-driven |
| Annual STI (2025 plan) | Manufacturing/Opex | 5% | Graded scale | In-progress | TBD | Formula-driven |
| RSUs (Grant 1/22/2024) | Time-based RSUs | — | 3-year tranches | Granted 3,544 | N/A | Vest annually over 3 years |
| Options (Grant 1/22/2024) | Options w/ TSR gate | — | FMV ≥ $20 and ≥ $25 for 20 days | Granted 41,350 | N/A | Vests at 3 years; exercisable upon TSR triggers; strike $10.28 |
Additional equity program design:
- 2024 shifted mix toward TSR-based options with $20/$25 share price hurdles for 20 consecutive trading days; time-based RSUs cliff/annual vesting; sustained anti-hedging policy .
Equity Ownership & Alignment
| Ownership Item | Detail |
|---|---|
| Total Beneficial Ownership | 88,676 shares; <1% of class |
| Unvested RSUs (12/31/2024) | 17,770 units; $82,275 market value |
| Stock Options | 41,350 options unexercisable; strike $10.28; expire 1/22/2027 |
| Exercisable Options | None reported for Donnelly (as of 12/31/2024) |
| Ownership Guidelines | 2x base salary for Section 16 officers (CEO reports) |
| Hedging/Pledging | Hedging prohibited; margin accounts disallowed; insider trading policy enforced |
| Section 16 Compliance | No Donnelly delinquencies noted; 2024 delinquencies cited for others |
Employment Terms
| Provision | Terms (Non-CEO NEOs including Donnelly) |
|---|---|
| Change-in-Control (CIC) | Double trigger required (CIC + qualifying termination within 24 months) |
| CIC Cash Benefits | Lump sum = 2x base salary + 2x average cash incentive (past 3 years) |
| COBRA | 24 months at existing coverage level |
| Outplacement | Up to $10,000 |
| Equity Acceleration | Immediate acceleration/vesting of unvested options/grants; PSUs at target |
| Clawback | Incentive recoupment upon material restatement due to misconduct (3-year lookback) |
| Non-compete/Non-solicit | Not specifically disclosed for Donnelly in proxy filings |
Estimated CIC economics for Donnelly (illustrative as of 12/31/2024):
| Component | Amount ($) |
|---|---|
| 2x Salary | 725,732 |
| 2x Average Bonus | 83,719 |
| COBRA | 90,629 |
| Outplacement | 10,000 |
| Accelerated Equity (FV) | 82,275 |
| Total Estimated | 992,355 |
Performance & Track Record
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Net Sales ($000s) | 609,615 | 579,371 | 549,520 |
| Net Income ($000s) | 27,404 | 7,519 | (124,855) |
| TSR – $100 initial value | $141 | $72 | $24 |
Context:
- 2024 was a transformative year: ERP upgrade, organizational redesign, and CEO transition; adjusted EBITDA was within targeted range but nonrecurring charges (transformation, reserves, impairments) drove a net loss; no cash bonuses paid to NEOs .
- During the CEO transition, an Office of CEO was formed, with Donnelly serving as Acting CEO to drive execution and accelerate transformation .
Compensation Committee Analysis and Peer Benchmarking
- Peer group (Exequity 2024–2025) comprises specialty chemical names such as AdvanSix, Arcadium Lithium, Aspen Aerogels, Balchem, Core Molding Tech, CVR Partners, Ecovyst, Hawkins, Haynes International, Innospec, Intrepid Potash, LSB Industries, Quaker Chemical, Tredegar .
- AVD disclosed NEO total direct compensation below the 25th percentile vs peers in 2024, consistent with pay-for-performance outcomes amid weak TSR and net results .
- Program changes increased objective, formula-driven metrics and TSR-based equity, with effective caps and clawbacks; no excise tax gross-ups; double-trigger CIC; no option repricing .
Say-on-Pay & Shareholder Feedback
- Recent say-on-pay approvals averaged ~89% over the past three years; earlier votes were ~93% (2024 meeting), ~91% (2023), and ~83% in a contested proxy year (2022), with ongoing investor outreach focusing on strategy, transformation, working capital, and capital allocation .
Risk Indicators & Red Flags
- Anti-hedging policy and clawback mitigate alignment risk; no tax gross-ups; double-trigger CIC; no repricing of underwater options .
- 2024 TSR deterioration and net loss heighten execution risk, but STI forfeiture and tighter KPI design indicate discipline on pay outcomes .
Investment Implications
- Strong alignment: Donnelly’s equity is predominantly unvested RSUs and options with performance gates, and hedging is prohibited—creating long-dated exposure to AVD’s margin expansion and transformation success .
- Near-term retention: OCEO transformation benefits and the 2025 KPI structure suggest continued engagement, while CIC economics are standard, double-trigger, and not shareholder-unfriendly (no gross-ups) .
- Execution watchpoints: Delivering adjusted EBITDA/working capital improvements and meeting TSR triggers will be key; no cash bonuses in 2024 underscores tight pay discipline amid underperformance .