Kerr W. Holbrook
Senior Vice President and Chief Commercial Officer at AVNS
Executive
About Kerr W. Holbrook
Kerr W. Holbrook, 58, is Senior Vice President and Chief Commercial Officer (appointed January 2023), after leading Avanos’ Chronic Care business as SVP & GM (May 2019–Dec 2022). He brings 30+ years in medtech/biopharma, including CCO at AlloSource and executive roles at Covidien/Medtronic; earlier career at Eli Lilly and McKesson . In 2024, Avanos delivered $687.8M net sales and $107.6M adjusted EBITDA; annual incentives paid at 81.5% based on adjusted net sales of $687.7M, adjusted EBITDA of $107.8M, and strategic initiatives execution (80% factor) . Total shareholder return value of a $100 investment stood at $47.24 as of 12/31/2024 (company series, 2019 base) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Avanos Medical | SVP & GM, Chronic Care | 2019–2022 | Led Chronic Care portfolio (MIC-KEY, Corpak, NeoMed) prior to transition to CCO |
| Avanos Medical | SVP & Chief Commercial Officer | 2023–Present | Company-wide commercial leadership across Digestive Health and Pain Management & Recovery |
| AlloSource | Chief Commercial Officer | 2015–2018 | Commercial leadership in biologics/regenerative medicine (spine, sports, ortho) |
| Covidien (now Medtronic MITG) | Group VP, Strategy/Portfolio/BD (and other executive roles) | Prior to 2015 | Strategy/portfolio development in minimally invasive therapies |
| Eli Lilly; McKesson | Marketing/BD leadership | Early career | Pharma and healthcare distribution experience |
External Roles
- No public company directorships disclosed for Holbrook .
Fixed Compensation
| Metric ($) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary | 400,000 | 440,833 | 500,000 |
| Stock Awards (Grant Date FV) | 719,976 | 1,400,183 | 1,400,000 |
| Non-Equity Incentive (AIP) | 288,308 | 224,031 | 264,720 |
| All Other Compensation | 28,564 | 82,750 | 33,278 |
| Total Reported Compensation | 1,436,848 | 2,147,797 | 2,197,998 |
Additional 2024 cash comp levers:
- Target annual bonus opportunity: 65% of base salary .
- Actual 2024 AIP payout: 81.5% of target (paid $264,720) .
Performance Compensation
Annual Cash Incentive (AIP) – 2024 Design and Outcome
| AIP Component | Weight | Threshold | Target | Maximum | Actual 2024 Performance | Payout Factor |
|---|---|---|---|---|---|---|
| Adjusted Net Sales (millions) | 30% | $670 | $690 | $710 | $687.7 | 89% |
| Adjusted EBITDA (millions) | 40% | $100 | $110 | $120 | $107.8 | 78% |
| Strategic Initiatives | 30% | — | — | — | Holistic assessment | 80% |
| Total AIP Payout | — | — | — | — | — | 81.5% |
Strategic initiatives targeted organic growth in PM&R (ex-HA), $20M cost savings, $15M working capital reduction, integration/separation milestones, and one tuck-in acquisition; no multiplier objectives (additional savings/WC/acquisitions) were met .
Long-Term Incentives (LTI)
2024 equity mix: 50% PRSUs, 50% TRSUs; one-third of 2024 TRSUs vest annually each March 6, 2025/2026/2027; 2024 PRSUs cliff-vest March 6, 2027 subject to performance .
- 2024 Grants to Holbrook: TRSUs 36,573 ($700,000 FV) and PRSUs (target) 36,573 ($700,000 FV) .
- 2024 PRSU metrics (50% FCF, 50% YoY ROIC) and 2024 “year-slice” result:
| 2024 PRSU Metric | Weight | Threshold | Target | Maximum | Actual | 2024 Payout Slice |
|---|---|---|---|---|---|---|
| Free Cash Flow ($m) | 50% | 60 | 75 | 90 | 83 | 76.3% |
| YoY ROIC (%) | 50% | 5.0 | 6.0 | 7.0 | 5.1 | 27.5% |
| Total Projected 2024 Payout | — | — | — | — | — | 103.8% |
Other outstanding PRSUs:
- 2023 PRSUs: 2024 slice projected at 89.6% of target; final vest March 6, 2026 .
- 2022 PRSUs: final payout 59.6% at vest (March 4, 2025) .
Equity Ownership & Alignment
- Beneficial ownership: 155,722 shares; less than 1% of outstanding .
- Options: 5,919 vested & exercisable; exercise price $28.87; expiration 5/7/2030 .
- Stock price at 12/31/2024: $15.92 (for valuation context) .
- Outstanding unvested awards (as of 12/31/2024):
| Award | Grant Date | Units (#) | Market Value ($) |
|---|---|---|---|
| TRSUs | 3/6/2024 | 36,573 | 582,242 |
| PRSUs (target) | 3/6/2024 | 36,573 | 582,242 |
| TRSUs | 3/6/2023 | 24,233 | 385,789 |
| PRSUs (target) | 3/6/2023 | 16,155 | 257,194 |
| TRSUs | 3/4/2022 | 5,145 | 81,913 |
| TRSUs | 3/4/2022 | 4,316 | 68,716 |
Ownership policies and status:
- Stock ownership guidelines: NEOs = 2x base salary; Holbrook meets guidelines .
- Mandatory retention: executives must hold at least 50% of shares acquired until guideline met .
- Hedging and pledging: prohibited by Insider Trading Policy .
Employment Terms
- Employment contract: Company policy states no individual employment contracts for executive officers .
- Severance (absent change-in-control): 1.5x (salary + target bonus) plus 6 months medical COBRA and outplacement/EAP .
- Change-in-control (double trigger required): 2x (salary + target bonus) plus 24 months COBRA; RSUs/options accelerate at target for performance awards .
- Clawback: NYSE-compliant incentive compensation clawback policy in place .
- Tax gross-ups: none on change-of-control payments .
- Potential payout values (as of 12/31/2024):
| Scenario | Cash ($) | Equity Acceleration ($) | Benefits/Other ($) | Total ($) |
|---|---|---|---|---|
| Qualified Termination after CIC | 1,975,000 | 1,892,128 | 43,302 | 3,910,430 |
| Involuntary Termination (no CIC) | 1,237,500 | — | 47,307 | 1,284,807 |
| Death | 1,255,000 | 843,644 | — | 2,098,644 |
| Disability | 325,000 | 843,644 | — | 1,168,644 |
- Deferred compensation: 2024 company non-qualified 401(k) contribution $17,910; aggregate balance $79,362 .
- Perquisites: minimal; 2024 “All Other Compensation” of $33,278 reflects defined contribution plan amounts (no material perqs) .
Investment Implications
- Pay-for-performance linkage: 50% of LTI in PRSUs tied to free cash flow and ROIC; 2024 PRSU slice projected above target (103.8%), while annual cash bonus paid below target (81.5%)—a balanced signal emphasizing cash returns and capital discipline .
- Selling pressure/overhang: RSU vesting on March 6 each year (2025–2027) could create periodic liquidity events, but 50% post-vesting retention until ownership guidelines are met dampens near-term selling; Holbrook is already guideline-compliant .
- Option incentives: Legacy options (ex. $28.87 strike) were out-of-the-money versus $15.92 year-end price, limiting exercise-driven selling and reinforcing focus on driving stock appreciation .
- Severance/CIC terms: Market-standard, double-trigger and no tax gross-ups; equity accelerates at target on CIC-related qualified terminations—moderate governance risk profile .
- Ownership alignment: Meaningful equity exposure (TRSUs/PRSUs) and prohibited hedging/pledging align interests with shareholders and mitigate collateralization risk .