Ronald J. Knutson
Executive Vice President, Chief Financial Officer and Treasurer at Distribution Solutions Group
Executive
About Ronald J. Knutson
Executive Vice President, Chief Financial Officer and Treasurer of Distribution Solutions Group, Inc. (DSG) and Lawson Products since January 27, 2023; employed on an at‑will basis under a 1/27/2023 employment agreement with initial base salary of $435,000 and eligibility for annual performance bonus and equity awards . Education and age are not disclosed in the filings. Pay-for-performance alignment is evidenced by multi-year LTIP outcomes: 2021–2023 PAs vested at 108.8% on three-year average ROIC of 26.8% vs 26.1% target, while MSUs did not vest as the 60‑day weighted average stock price was below the $30.75 threshold; RSUs vested in full at cycle completion with a two‑year post-vest holding requirement to 1/1/2026 . His total direct compensation (TDC) was benchmarked below peer median in 2023 ($1,492.4k vs $1,650.5k median), supporting conservative pay positioning for CFO relative to a tailored peer set .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Distribution Solutions Group (DSG) | EVP, CFO & Treasurer (also CFO of Lawson) | 2023–present | Dual holding/opco finance leadership; equity awards designed to be “out-of-the-money” and vest over 5 years to drive stock price appreciation . |
| Lawson Products, Inc. | EVP, CFO, Treasurer & Controller | 2012–2022+ | Oversaw AIP/LTIP programs; led through 2018–2020 and 2020–2022 LTIPs and COVID-related AIP amendments; historical comp agreement dated 8/29/2012 . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | None disclosed | — | — |
Fixed Compensation
Multi-year compensation (Summary Compensation Table):
| Metric ($) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary | 423,943 | 470,625 | 493,125 |
| Bonus (discretionary) | — | — | 40,000 (paid in 2025) |
| Stock Awards (RSUs grant-date FV) | — | 406,600 | — |
| Option Awards (grant-date FV) | — | 1,441,350 | — |
| Non-Equity Incentive (AIP earned) | 383,749 | 393,446 | — (not reported) |
| All Other Compensation | 21,218 | 23,848 | 25,110 |
| Total | 828,910 | 2,735,869 | 558,235 |
All Other Compensation (2024 detail):
| Component | Amount ($) |
|---|---|
| 401(k) Matching | 13,800 |
| Deferred Compensation Contributions | 6,825 |
| Disability Insurance | 2,670 |
| Total | 25,110 |
Base salary progression:
| Effective Date | Annualized Base Salary ($) |
|---|---|
| 3/16/2023 | 480,000 |
| 3/16/2024 | 525,000 (expanded dual-role scope) |
Performance Compensation
Annual Incentive Plan (AIP) – 2024 opportunity:
| Grant Year | Threshold ($) | Target ($) | Maximum ($) | Notes |
|---|---|---|---|---|
| 2024 AIP | 210,000 | 420,000 | 609,000 | Paid Feb/Mar 2025 by operating company; specific 2024 metrics not disclosed for Knutson . |
LTIP structure and outcomes:
| Metric (2021–2023 LTIP) | Weighting | Target | Actual | Payout | Vesting / Holding |
|---|---|---|---|---|---|
| RSUs | 20% | Service through 12/31/2023 | Met | 100% | Vested 12/31/2023; two-year post-vest holding until 1/1/2026 . |
| Performance Awards (ROIC) | 40% | 3-yr avg ROIC 26.1% | 26.8% | 108.8% of target | Vested as common stock; two-year post-vest holding until 1/1/2026 . |
| MSUs (Stock Price) | 40% | Threshold $30.75; Target $35.75; Max $40.50 | $28.25 | 0% (below threshold) | No vest; measured on 60-day weighted average price . |
Special January 27, 2023 equity (employment agreement vs. actual grants):
- Employment agreement (8-K) contemplated 10,000 RSUs and 123,000 options at exercise prices $55, $80, $110, $140, vesting in five equal installments on 1/27/2024; 4/1/2024; 4/1/2025; 4/1/2026; 4/1/2027; 10-year expiry .
- Company proxies disclose outstanding awards reflecting RSUs of 20,000 and options totalling 246,000 at strikes $27.50, $40.00, $55.00, $70.00 with the same five-date vesting cadence; this set appears to be the operative grants (see Outstanding Equity Awards tables below) .
SPR/Option exercises and RSU vesting in 2024:
| Item | Quantity | Value Realized ($) |
|---|---|---|
| SPRs exercised | 15,966 shares | 369,852 |
| RSUs vested (employment-agreement RSUs) | 8,000 shares (4,000 on 1/27/2024; 4,000 on 4/1/2024) | 268,520 |
Equity Ownership & Alignment
Beneficial ownership:
| As-Of Date | Shares Beneficially Owned | % of Outstanding |
|---|---|---|
| 3/28/2024 | 85,496 | 0.2% |
| 4/2/2025 | 235,510 | 0.5% |
Outstanding equity awards (options/SPRs and RSUs):
| Tranche | 12/31/2023 Exercisable (#) | 12/31/2023 Unexercisable (#) | 12/31/2024 Exercisable (#) | 12/31/2024 Unexercisable (#) |
|---|---|---|---|---|
| SPR @ $11.38 (exp. 12/31/2024) | 15,966 | — | — (expired) | — |
| SPR @ $12.35 (exp. 12/31/2025) | 17,484 | — | 17,484 | — |
| SPR @ $15.27 (exp. 12/31/2026) | 10,034 | — | 10,034 | — |
| Options @ $27.50 (1/27/2033) | — | 96,000 | 38,400 | 57,600 |
| Options @ $40.00 (1/27/2033) | — | 30,000 | 12,000 | 18,000 |
| Options @ $55.00 (1/27/2033) | — | 60,000 | 24,000 | 36,000 |
| Options @ $70.00 (1/27/2033) | — | 60,000 | 24,000 | 36,000 |
| RSUs (unvested count; year-end price basis) | 20,000 (MV $631,200) | — | 12,000 (MV $412,800) | — |
Vesting schedule (key dates and quantities):
| Award | Vest Dates | Shares per Vest |
|---|---|---|
| Employment-agreement RSUs (20,000 disclosed in proxies) | 1/27/2024; 4/1/2024; 4/1/2025; 4/1/2026; 4/1/2027 | 4,000 each |
| Options @ $27.50 | Same five dates | 19,200 per date |
| Options @ $40.00 | Same five dates | 6,000 per date |
| Options @ $55.00 | Same five dates | 12,000 per date |
| Options @ $70.00 | Same five dates | 12,000 per date |
Policies affecting alignment:
- Anti-hedging policy prohibits executives/directors from hedging company stock; clawback policy aligns with Nasdaq Rule 10D‑1; no tax gross‑ups for CIC; compensation heavily performance-based .
- Pledging policy not disclosed; stock ownership guidelines for executives not disclosed in the cited filings .
Deferred compensation:
| Item | Amount ($) |
|---|---|
| Executive contributions (2025 for 2024 earnings) | 8,000 |
| Registrant contributions | 6,825 |
| Aggregate earnings (last FY) | 361,225 |
| Aggregate balance at FYE | 3,187,155 |
Employment Terms
Key terms (employment agreement/proxy summaries):
- At-will employment; initial base salary $435,000; annual bonus target at least 80% of base; equity awards subject to plan terms .
- Severance (without Cause; Good Reason; death/disability): two years of then-current base salary; two years of health benefit coverage; accelerated vesting of outstanding options and RSUs (proxy clarifies acceleration and coverage by Lawson) .
- Change-in-control: double-trigger acceleration of benefits; options vest and become exercisable 10 days prior to CIC; cash-out of in-the-money vested options; 280G cutback applies (reduce payments to avoid excise tax if net benefit is higher) .
Potential payments upon termination/CIC (assumes 12/31/2024 event; stock price $34.40):
| Scenario | Base Salary | RSUs Accel | Options Value | Medical Benefits | Total |
|---|---|---|---|---|---|
| Termination after CIC | 1,050,000 | 412,800 | 397,440 | 32,162 | 1,892,402 |
| Termination without Cause | 1,050,000 | 412,800 | 99,541 | 32,162 | 1,594,503 |
| Voluntary for Good Reason | 1,050,000 | 412,800 | 99,541 | 32,162 | 1,594,503 |
| Death | 1,050,000 | 412,800 | 99,541 | 32,162 | 1,594,503 |
| Disability | 1,050,000 | 412,800 | 99,541 | 32,162 | 1,594,503 |
Non-compete and non-solicit:
- Non-compete duration of 18 months post-termination; non-solicit obligations also apply .
Compensation Committee Analysis
- Compensation Committee comprises independent directors Bianca A. Rhodes (Chair), I. Steven Edelson, Mark F. Moon, and Robert S. Zamarripa; uses independent consultant FGMK; no services to management; policies include anti-hedging and clawbacks; no gross-ups, no single-trigger parachutes .
Peer groups and comparative positioning:
- DSG peer group of 13 distribution/industrial companies (median revenue ~$1.517B; market cap ~$1.377B) and a 14‑company operating peer group for Lawson/TestEquity/Gexpro (median revenue ~$497M) .
- CFO TDC comparison: Company TDC $1,492.4k vs peer median $1,650.5k and 75th percentile $1,845.0k (2023 base, 3‑yr average AIP earned, 3‑yr average LTI grant) .
Say-on-Pay & Shareholder Feedback
- 2024 Say‑on‑Pay approval: 99.96% support (excluding broker non‑votes/abstentions), signaling strong investor endorsement of compensation philosophy and governance practices .
Investment Implications
- Near-term vesting cadence: RSUs and options vest on 4/1/2025, 4/1/2026, 4/1/2027; RSUs 4,000 shares per tranche; options vesting across four strikes (some tranches currently out-of-the-money), implying incremental equity supply but moderated by plan design and in‑the‑money exposure largely concentrated at $27.50 .
- Selling pressure assessment: 2024 vesting of 8,000 RSUs and cash‑settled SPR exercises (15,966) indicate realized value without necessarily requiring open-market sales; two‑year post‑vest holding requirements on 2021–2023 LTIP shares until 1/1/2026 reduce near‑term sell pressure on those awards .
- Retention and change‑of‑control protections: Two‑year salary severance, benefit continuation, and equity acceleration under double‑trigger CIC support retention and reduce transition risk; 280G cutback mitigates parachute escalation risk .
- Alignment signals: Strong governance (no gross‑ups, clawbacks, anti‑hedging) and below‑median CFO TDC vs peer median suggest controlled pay practices; equity grants with multi-year, largely out-of-the-money option strikes reinforce long-term stock price alignment .
Notes:
- Pledging policy and executive stock ownership guidelines are not disclosed in the cited filings .
- No Form 4 insider trading filings were found via the system index for DSGR in this session, limiting granular trade-timing analysis.