Reece Kurtenbach
About Reece A. Kurtenbach
Reece A. Kurtenbach, 60, is a long‑tenured Daktronics director (since 2013), former Chair/President/CEO (2013–Mar 5, 2025), and an electrical engineer by training (BS, South Dakota State; minors in math and computer science). He became Interim CEO of X Display Company (XDC) in April 2025 and remains a Daktronics director, having agreed to resign from the Board upon appointment of a new Daktronics CEO pursuant to his separation terms . He is the brother of Daktronics executives Carla Gatzke and Matthew Kurtenbach, which affects independence assessments .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Daktronics | Chair, President & CEO | 2013–Mar 5, 2025 | Set corporate strategy, led executive team; prior roles included EVP Live Events & International; led engineering for video products; oversaw development of first full‑color LED video display . |
| Daktronics | Director | 2013–present (will resign upon appointment of new CEO per Separation Agreement) | Former Board Chair until Mar 5, 2025 . |
| Unisys; RoMar, Ltd. | Engineer (Analog Test; Hardware) | Post‑graduation (pre‑1991) | Early engineering roles prior to rejoining Daktronics in 1991 . |
| Daktronics (early career) | Manufacturing & Customer Service (student); later design group manager | 1982 (student); returned 1991 | Managed team that developed Daktronics’ first full‑color LED video display . |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| X Display Company (XDC) | Interim CEO | Appointed April 2025 | Daktronics holds a 16.4% ownership stake; relationship monitored under related person policy . |
| Etulipa | Board member | Current | Board service disclosed (private company) . |
| Boys & Girls Club of the Northern Plains | Board service (prior), ongoing volunteer | Ongoing involvement | Community engagement; youth advocacy . |
| Catholic Foundation Board for the East River Diocese of SD | Board member | Current | Non‑profit governance . |
Board Governance
- Status: Not independent under Nasdaq; the proxy lists independent directors and does not include Reece (family ties to two executives also impair independence) .
- Roles: Former Board Chair until Mar 5, 2025; Chair role now held by independent director Andrew D. Siegel; Lead Independent Director role eliminated when Chair became independent .
- Committees: No committee assignments disclosed for Reece during Fiscal 2025; Audit, Compensation, Nominating, Strategy & Risk, and Temporary Special Committee memberships are listed and do not include him .
- Attendance: All incumbent directors attended at least 75% of Board/committee meetings in FY2025; the Board held 8 regular and 15 special meetings, with active committee cadence (Audit 5; Compensation 20; Nominating 4; Strategy & Risk 5) .
- Executive sessions: Independent directors met in executive session four times in FY2025 .
- Separation & Board tenure signal: Separation Agreement provides he will resign from the Board upon appointment of a new CEO; he continues as a director until then .
Fixed Compensation
| Component | FY2025 Amount | Notes |
|---|---|---|
| Director cash retainer | $0 | Reece received no director compensation in FY2025 because he was a Named Executive Officer through Mar 5, 2025 . |
| Director equity grant | $0 | FY2025 standard director RSU was 7,160 shares ($85,000) for independent directors; Reece did not receive director equity as a NEO . |
| Executive base salary (as CEO through Mar 5, 2025) | $534,306 | Reported in Summary Compensation Table for FY2025 . |
| COBRA continuation payments (post‑separation) | Company‑paid amount for 24 months | Cash equal to premium cost for 24 months per Separation Agreement . |
| Severance (post‑separation) | $1,800,000 | Paid in substantially equal installments over two years, beginning ~45 days after Mar 5, 2025 . |
Performance Compensation
| Item | Details |
|---|---|
| Annual incentive metric framework (FY2025) | Company operating margin drives payouts; threshold <2.5% pays 0%; target 10% pays 100%; max 12.5% pays 120% of target . |
| FY2025 NEO plan attainment | Company attainment 19% overall; total NEO cash bonus paid $119,792; Reece received $0 non‑equity incentive in FY2025 . |
| Equity awards granted FY2025 (pre‑separation) | 9/9/2024: 2,270 RSUs and 4,180 options at $11.87 strike; 3/5/2025: 4,186 RSUs at $14.33; RSUs/options vest 20% annually over 5 years . |
| Equity acceleration under Separation Agreement | Partial acceleration: unvested stock options and RSUs vested as to the next scheduled tranche only (first vesting date after Mar 5, 2025); value from early option acceleration reported as $680,213 . |
| Option exercises & RSUs vested (FY2025 activity) | 30,000 options exercised (value realized $161,639); 8,998 RSUs vested (value $127,270) . |
FY2025 Annual Incentive Payout Curve
| Operating Margin | % of Target Payout |
|---|---|
| <2.5% | — |
| 2.5%–5.0% | 0%–25% |
| 5.0%–7.5% | 25%–60% |
| 7.5%–10.0% | 60%–100% |
| 10.0%–12.5% | 100%–120% |
Other Directorships & Interlocks
| Company | Public/Private | Role | Interlock/Conflict Consideration |
|---|---|---|---|
| X Display Company (XDC) | Private | Interim CEO (Apr 2025) | Daktronics owns 16.4% of XDC; Reece’s role makes him a related person; Company is monitoring for appropriate governance/disclosure . |
| Etulipa | Private | Director | No transactions disclosed; board role noted . |
Expertise & Qualifications
- Deep domain experience in display technology, manufacturing, engineering management, and international operations; led Daktronics’ first full‑color LED video display development; extensive executive oversight (Live Events, International) .
- Community and non‑profit governance experience (Boys & Girls Club of the Northern Plains; Catholic Foundation Board) .
- Technical foundation: BS Electrical Engineering with minors in math and computer science (South Dakota State University) .
Equity Ownership
| Metric | Amount |
|---|---|
| Beneficial ownership | 580,135 shares (includes 17,400 held by spouse) . |
| % of shares outstanding | 1.2% (based on 49,120,799 shares outstanding as of Jul 16, 2025) . |
| Director ownership guideline | 20,000 shares target; directors generally have 5 years to comply; Directors were in compliance as of Jul 16, 2025 (Reece well above target) . |
| Pledging/Hedging | Hedging/short sales prohibited for directors; no pledging disclosed for Reece . |
| FY2025 equity activity | 30,000 options exercised ($161,639 value); 8,998 RSUs vested ($127,270 value); early option acceleration value $680,213 under Separation Agreement . |
Related‑Party Exposure and Conflicts
- Family relationships: Sibling of two current Daktronics executives (Carla S. Gatzke – VP HR/Secretary; Matthew J. Kurtenbach – VP Manufacturing), a key independence and governance consideration .
- XDC role: As Interim CEO of XDC (16.4% owned by Daktronics), he is a related person; the Audit Committee oversees related‑party transaction policy and the Company states it is monitoring the relationship for appropriate governance/disclosure .
- Section 16 reporting: Company disclosed late Section 16 filings, including four late reports for six transactions by Reece; this is a modest process red flag .
Employment, Separation & Change‑in‑Control Provisions
- Separation Agreement (effective Mar 5, 2025):
- Cash severance: $1,800,000 over ~24 months; COBRA cost reimbursements for 24 months .
- Equity: Partial acceleration equal to the next scheduled vesting tranche for unvested options/RSUs as of separation .
- Governance: Resigned as Chair & CEO; agreed to resign from Board upon appointment of new CEO; consulting through Oct 31, 2025 (~20 hours/week) with consideration encompassed in severance .
- Clawback: Company‑wide clawback policy compliant with SEC/Nasdaq (recoupment of incentive compensation after restatements) .
- Equity plan CoC terms (2025 plan proposal): Double‑trigger acceleration upon Change‑in‑Control Termination; if awards are not assumed in a CoC, single‑trigger acceleration may occur; excise‑tax “cutback” (no gross‑up) .
Director Compensation Context (FY2025 Program)
- Standard independent director package: $53,750 cash retainer plus $85,000 annual RSU (7,160 shares at $11.87 grant‑date), with additional committee chair/member fees; special Temporary Special Committee chair retainer was $350,000 (paid to Atkins) .
- Reece received no director compensation in FY2025 (compensated as NEO through separation) .
Insider Trades and Attendance
| Item | Detail |
|---|---|
| FY2025 trading/vesting | 30,000 options exercised ($161,639 value); 8,998 RSUs vested ($127,270 value) . |
| Section 16 timeliness | Four late reports for six transactions (company disclosure) . |
| Meeting engagement | ≥75% attendance of Board/committee meetings by all incumbents; Board met 23 times (8 regular/15 special) in FY2025; committees active . |
Governance Assessment
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Strengths:
- Extensive operating/technology expertise and institutional memory; large personal shareholding exceeding director ownership guidelines; aligns economically with shareholders .
- Separation structured with partial vesting (not full acceleration), COBRA support, and a time‑limited consulting role; no excise tax gross‑ups disclosed, consistent with shareholder‑friendly practices .
- Board structure improved with independent Chair (Siegel), elimination of LID under independent chairing, active committee oversight and clawback policy .
-
Risks/Red Flags:
- Not independent (family ties to two executives) and related‑party status via Interim CEO role at XDC where Daktronics holds 16.4%—requires continued monitoring for conflicts and transaction fairness .
- Late Section 16 filings indicate process/control slippage on insider reporting; incremental risk to investor confidence .
- Activist engagements (Prairieland, Alta Fox) and related cooperation agreements underscore governance transition dynamics; Board commitments include comp consultant engagement and investor day—execution quality will matter to confidence .
-
Bottom line signals for investors: Kurtenbach’s deep domain expertise and substantial ownership align him with long‑term value creation, but his non‑independent status, family relationships, and XDC linkage necessitate vigilant oversight by independent directors and the Audit Committee to mitigate perceived conflicts and sustain investor trust .