Hadi H. Awada
Axalta Coating SystemsAbout Hadi H. Awada
President, Global Mobility Coatings at Axalta since 2024; the company raised base salaries for the three business Presidents in connection with their transitions into those roles effective January 1, 2024 . Education and age are not disclosed in the latest proxy. Under his purview, Mobility delivered YoY Adjusted EBITDA margin expansion in Q1 2025 (16.5% vs 14.2%) amid flat net sales . Company performance during 2024 set records in net sales ($5.3B, +2% YoY) and Adjusted EBITDA ($1.116B, +17% YoY); Adjusted EPS rose 40% to $2.35, and the 2022–2024 PSU cycle paid at ~26% of target with Relative TSR at the 50th percentile modifier level .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Axalta | President, Global Mobility Coatings | 2024–present | Exceeded financial targets via new business (China/LatAm), pricing actions, and integration execution; advanced early-careers rotational program . |
Fixed Compensation
| Component | 2023 | 2024 (effective Mar 11, 2024) |
|---|---|---|
| Base Salary ($) | $505,852 | $571,500 |
| Target Bonus (% of salary) | 70% | 75% |
| Target Bonus ($) | — | $428,625 |
Notes: 2024 target increases reflect expanded responsibilities for business Presidents .
Performance Compensation
Annual Bonus Plan (ABP) – Design and 2024 Results
- Company-wide metrics; individual modifier 0–200%; 2024 metrics and outcomes below .
| Metric | Weight | Threshold (50% payout) | Target (100%) | Max (200%) | 2024 Actual | Payout as % of Weight | Notes |
|---|---|---|---|---|---|---|---|
| Adjusted EBIT ($mm) | 50% | $643 | $772 | $884 | $835 | 75.7% | Company definition adjustments detailed in proxy . |
| Adjusted EBIT Margin | 25% | 13.9% | 14.9% | 16.6% | 15.9% | 40.2% | — |
| Free Cash Flow ($mm) | 25% | $383 | $435 | $544 | $451 | 28.3% | — |
| Total | 100% | — | — | — | — | 144.2% | — |
- Executive-specific modifier and payout:
| Executive | Target Bonus ($) | Company Payout % | Individual Modifier | Actual Award ($) | Payout % of Target |
|---|---|---|---|---|---|
| Hadi H. Awada | $428,625 | 144.2% | 110% | $679,885 | 158.6% |
Modifier drivers for Awada: exceeded financial targets through new business in China and Latin America and pricing; integration execution; talent development program .
- 2025 plan change: ABP shifts to Adjusted EBITDA and Adjusted EBITDA Margin (replacing Adjusted EBIT metrics), plus FCF; range remains 0–200% with individual modifier .
Long-Term Equity – Awards and Metrics
- 2024 LTI mix: 60% PSUs (3-year performance), 40% RSUs (time-based, 3 annual tranches) .
| 2024 Grant | Vehicle | Target Value ($) | Units (#) | Metric(s) | Performance Window | Payout Range |
|---|---|---|---|---|---|---|
| H. Awada | PSUs | $540,000 | 16,624 | 50% Adjusted EBITDA; 50% Relative TSR vs S&P 400 MidCap | 2024–2026 (EBITDA); ~Feb 27, 2024–Feb 27, 2027 (TSR) | 0–200% |
| H. Awada | RSUs | $360,000 | 11,085 | Time-vest | Vest in 3 equal annual installments | n/a |
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2022–2024 PSU payout: Vested at ~26% of target; Relative TSR at 50th percentile (no modifier); ROIC above threshold/below target; Adjusted EPS below threshold for final year and cumulative .
-
2025 PSU design change: financial metric shifts from Adjusted EBITDA to 3-year cumulative Adjusted EPS (50% of PSUs), with 50% Relative TSR maintained .
2024 Shares Vested (Realized)
| Executive | Shares Vested in 2024 (#) | Value on Vesting ($) |
|---|---|---|
| Hadi H. Awada | 29,590 | $996,371 |
Equity Ownership & Alignment
- Beneficial ownership: 39,671 common shares as of April 10, 2025 (less than 1% of shares outstanding) .
- Outstanding equity (Dec 31, 2024):
| Grant Year | Instrument | Unvested Units (#) | Market Value at 12/31/24 ($) |
|---|---|---|---|
| 2024 | RSUs | 11,085 | $379,329 |
| 2024 | PSUs (at threshold display) | 8,312 | $284,437 |
| 2023 | RSUs | 7,160 | $245,015 |
| 2023 | PSUs (at threshold display) | 8,053 | $275,574 |
| 2022 | RSUs | 3,702 | $126,682 |
| 2022 | PSUs (2012–24 cycle; service-only post 12/31) | 4,315 | $147,661 |
- Ownership guidelines: President-level executives required to hold 2x base salary; PSUs/options excluded; all NEOs either meet guidelines or are within grace period .
- Hedging/pledging: Prohibited (no margin, no hedging/short sales, no pledging); pre-clearance and blackout windows apply to trades by officers .
Potential vesting/supply considerations:
- RSUs vest in equal annual tranches over 3 years (grants in 2022–2024) , indicating scheduled stock delivery through 2027.
- 2022 PSUs vested in March 2025 at ~26% of target , adding stock supply.
- Merger agreement treatment (AkzoNobel): At closing, outstanding RSUs/PSUs generally convert into AkzoNobel RSUs based on an exchange ratio; PSUs convert at deemed performance and become time-vesting; awards not assumed or held by former service providers receive cash/share consideration and may fully vest; options assumed or cashed out depending on status; delivery net of tax withholding . This structure can accelerate vesting/settlement upon change-in-control (subject to terms), potentially pulling forward equity supply.
Employment Terms
- Coverage: Subject to Company’s Restrictive Covenant and Severance Policy (not the CEO’s separate agreement) .
- Definitions: Non-CIC Good Reason severance not available under policy; Good Reason only if within two years post-Change-in-Control (procedural requirements apply) .
- Change-in-Control equity: “Double-trigger” (CIC plus qualifying termination) for 100% acceleration of RSUs; PSUs settle based on target vs actual performance per award terms; if awards not assumed/substituted at CIC, acceleration may occur .
- Clawback: Policy compliant with SEC/NYSE rules; separate broader recoupment for Executive Committee members; enforced for restatements and certain policy violations .
- Hedging/pledging: Prohibited (see above) .
- Severance economics (illustrative amounts as of Dec 31, 2024):
| Scenario (as of 12/31/24) | Salary Severance ($) | Bonus Severance ($) | Equity Vesting Value ($) | Other Severance ($) | Total ($) |
|---|---|---|---|---|---|
| Termination without Cause (non-CIC) | 571,500 | 443,432 | — | 29,729 | 1,044,661 |
| Termination without Cause or Resignation for Good Reason within 2 years post-CIC | 1,143,000 | 857,250 | 2,171,089 | 59,457 | 4,230,796 |
| Death/Disability | — | — | 2,440,947 | — | 2,440,947 |
- Non-compete/non-solicit: Severance Policy includes restrictive covenants; e.g., separation agreements reference non-competition obligations .
Compensation Structure Analysis
- Pay mix: Significant at-risk pay for NEOs (ABP + LTI); program designed for pay-for-performance; no tax gross-ups; no single-trigger CIC vesting; no option repricing; clawbacks in place .
- Year-over-year changes: Awada’s target bonus increased from 70% to 75% with promotion to President role; base salary increased to $571,500 in 2024 .
- Shift to EBITDA focus: 2025 ABP shifts from EBIT to EBITDA metrics; 2025 PSUs use 3-year cumulative Adjusted EPS (replacing Adjusted EBITDA), keeping Relative TSR for balance .
- Peer benchmarking: Compensation set with reference to a chemicals/industrials peer set; broader WTW survey data used; Company positioned near median on size metrics .
Multi-Year Compensation Summary (Hadi H. Awada)
| Year | Salary ($) | Stock Awards ($) | Non-Equity Incentive Plan ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|
| 2022 | $505,852 | $1,630,116 | $232,287 | $38,985 | $2,407,240 |
| 2023 | $525,366 | $905,878 | $654,578 | $45,345 | $2,131,167 |
| 2024 | $575,896 | $1,000,397 | $679,885 | $45,376 | $2,301,554 |
All Other Compensation 2024 detail: liability insurance $2,363; disability insurance $3,100; 401(k) employer contribution $24,150; nonqualified deferred comp employer contribution $15,763 .
Equity Awarding and Vesting Schedules (Detail)
| Grant | Units (#) | Vesting Terms |
|---|---|---|
| 2024 RSUs | 11,085 | 3 equal annual installments on each of the first three anniversaries of grant . |
| 2024 PSUs | 16,624 (target) | 50% Adjusted EBITDA (2024–2026); 50% Relative TSR vs S&P 400 MidCap (3-year period); 0–200% payout; vest post-certification in 2027 . |
| 2023 RSUs | 7,160 | Same 3-year annual vest schedule . |
| 2023 PSUs | 8,053 (displayed at threshold) | 2023–2025 cycle; vest post-certification in 2026 if earned . |
| 2022 RSUs | 3,702 | 3-year annual vest schedule . |
| 2022 PSUs | 4,315 (service-only as of 12/31/24) | Vested at ~26% of target in March 2025 based on performance . |
Equity Ownership & Beneficial Ownership
| Holder | Shares Beneficially Owned | % of Class |
|---|---|---|
| Hadi H. Awada | 39,671 | * (<1%) |
Executive Officer Stock Ownership Guidelines: 2x base salary for President-level; all current executive officers satisfy or are within grace period .
Governance, Controls, and Policies Relevant to Alignment
- Clawback policies (SEC/NYSE-compliant and broader internal policy) .
- Insider trading policy: blackouts, pre-clearance; prohibits hedging, short sales, pledging, and margin accounts .
- Related-party transactions: none reportable since start of 2024 .
- Say-on-Pay support: 98.65% approval at 2024 AGM, indicating strong shareholder endorsement of executive pay practices .
Employment Contracts, Severance, and Change-of-Control Economics
- Severance Policy governs Awada; non-CIC Good Reason severance not available (only within two years post-CIC) .
- Double-trigger CIC vesting for RSUs; PSU treatment based on target vs actual and award design; accelerated vesting also for death/disability (PSUs at target) .
- Estimated benefits as of 12/31/24 summarized in Employment Terms table above .
Merger-related equity treatment (if consummated): Axalta awards generally assumed and converted into AkzoNobel equity awards; PSUs become time-based RSUs at deemed performance; certain awards (e.g., vested RSUs; awards held by former service providers; completed performance periods) cash/stock-settled at closing; options assumed or cashed out based on status; delivery timelines and tax withholding specified .
Performance & Track Record
- Mobility Coatings Q1 2025: Adjusted EBITDA $73M (YoY +$10M); margin 16.5% (vs 14.2% prior-year), with price-mix positive and lower costs; net sales -1% YoY .
- Company 2024: records in net sales ($5.3B, +2%) and Adjusted EBITDA ($1.116B, +17%); net income $391M (+45%); Adjusted EPS $2.35 (+40%); ROIC improved by 270 bps; share repurchase $100M .
- 2022–2024 PSUs paid ~26% (below target), with Relative TSR at median (50th percentile) .
Investment Implications
- Incentive alignment: Awada’s pay is highly performance-linked; 2024 ABP overachievement and a 110% individual modifier produced a 158.6% payout, reflecting outperformance in Mobility and execution on growth and integration—supportive of pay-for-performance .
- Retention risk: Meaningful unvested RSUs/PSUs across 2022–2024 vintages with 3-year schedules and double-trigger CIC protection promote retention; Severance Policy provides moderate cash protection (e.g., ~$4.23M CIC scenario total as of 12/31/24), reducing flight risk during strategic change .
- Selling pressure: Regular RSU tranches through 2027 plus 2022 PSU vesting in March 2025 add supply; potential CIC could convert/accelerate equity per merger terms, pulling forward deliveries; however, insider trading policy (blackouts, pre-clearance) and ownership guidelines temper opportunistic selling .
- Strategic execution: Mobility margin expansion and company-level records in 2024 indicate operational momentum under the A Plan; 2025 metric shifts (ABP to EBITDA; PSUs to EPS) heighten focus on cash-earnings quality and capital discipline—potentially raising hurdle rates for incentive payouts .