Keith Walters
About Keith Walters
Keith S. Walters (age 76) is Chairman, President, and Chief Executive Officer of Ennis, Inc. (EBF). He joined Ennis in August 1997 and was appointed CEO in November 1997, subsequently adding the Chairman and President titles; he has led more than 60 acquisitions and scaled Ennis into the largest wholesale printer in the U.S. . Under the SEC Pay-versus-Performance disclosure, Ennis reported 5-year TSR of $150.98 on a $100 initial investment through FY2025 and ROE of 12.3% in FY2025, indicating stable value creation in recent years . FY2025 annual bonus metrics were narrowly missed on Sales and Profit but were near-target on ROE (Sales 90.0% of target; Profit 88.7%; ROE 98.1%), yielding 60.65% of base salary for Mr. Walters’ annual bonus .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ennis, Inc. | VP, Commercial Printing Operations; then CEO, Chairman, President | 1997–present | Led >60 acquisitions; diversified product lines; rolled out ERP to accelerate acquisition returns . |
| Atlas/Soundolier (American Trading & Production Co.) | Vice President of Manufacturing | 1989–1997 | Manufacturing leadership in electronic sound/warning systems . |
| United Technologies Corp. (Automotive Division) | Manufacturing/Operations roles | ~1974–1989 (15 years) | Operations and manufacturing leadership in automotive components . |
External Roles
| Organization | Role | Years | Notes / Impact |
|---|---|---|---|
| PSDA (Brand Chain predecessor) | Board member | 2002–2007 | Helped strengthen association governance, including PERF Trust merger . |
| IBFI (pre-merger with PSDA) | Board member | n/a | Industry leadership and governance . |
| ASI “Counselor Power 50” | Industry recognition | Multiple years | Recognized as influential executive in ad specialty industry . |
Fixed Compensation
| Component | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Base Salary ($) | 1,003,895 | 1,035,110 | 1,066,164 |
| Cash Perquisites (Auto Allowance) ($) | 12,000 | 12,000 | 12,000 |
| Pension – Change in Present Value ($) | — | 112,762 | 142,632 |
Notes:
- Employee directors receive no additional board compensation .
Performance Compensation
Annual Bonus (FY2025 Plan and Outcomes)
| Metric | Weight | Target | Actual | % of Target | Payout Basis | Result |
|---|---|---|---|---|---|---|
| Sales | 20% | $438.521M | $394.617M | 90.0% | Portion of target bonus tied to Sales | 10.66% of base salary for Walters |
| Profit before incentive comp | 40% | $47.918M | $42.513M | 88.7% | Portion tied to Profits | 19.97% of base salary |
| Return on Equity (pre-bonus) | 40% | 13.3% | 13.1% | 98.1% | Portion tied to ROE | 30.02% of base salary |
| Total Bonus | — | — | — | — | Total % of base | 60.65% of base; $650,224 on $1,072,169 base |
- Threshold 85% payout at 50% of target; maximum 115% pays 200% of metric portion; linear interpolation in between; overall cap 2x target bonus; no discretionary adjustments in FY2025 .
Long-Term Incentives (FY2025–FY2027 RSUs; grant 4/19/2024)
| Element | Design | Targets / Vesting | Keith Walters Award (Target) |
|---|---|---|---|
| Performance RSUs (60%) | 3-year performance (EBITDA and ROE), with TSR modifier if below target | EBITDA sum FY25–FY27: Threshold $170.8M (70% vest), Target $244.0M (100%), Max $317.2M (130%); ROE Threshold 9.0% (70%), Target 12.9% (100%), Max 16.8% (130%); TSR modifier 130%/>66.6th pct; 100%/33.3–66.6th; 70%/≤33.3rd . | 104,293 target units |
| Time-based RSUs (40%) | Vests ratably over 3 years (2025/2026/2027) | Shares or, at Committee’s discretion for Walters, cash equivalent on vest . | 69,528 units |
| Total Grant Size | — | — | 173,821 target RSUs; grant-date values in SCT reflect these awards . |
Acceleration:
- Equity acceleration for Walters: 100% vesting upon disability, death, termination by company without Cause, Good Reason, or retirement (with notice). On Change in Control, RSUs fully vest immediately prior to the event, with performance RSUs deemed at maximum 130% (single-trigger for equity) . Other NEOs have no accelerated vesting; unvested awards are forfeited on termination or CoC .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 590,245 shares (community property with spouse, Director Margaret A. Walters); 2.3% of outstanding as of May 16, 2025; no pledges permitted under policy . |
| Outstanding unvested awards (2/28/2025) | Time-based RSUs: 69,528 (market value $1,468,431 at $21.20); Performance RSUs at target: 104,293 (market value $2,202,668) . |
| Options | None outstanding for Walters . |
| Insider trading / pledging | Insider Trading Policy prohibits hedging or pledging by officers and directors . |
| Executive ownership guidelines | CEO: 4x base salary; other NEOs: 2x; if NEOs not yet in compliance, 50% of time-based RSUs convert to options until compliant (added alignment mechanism) . |
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment agreement | Originally dated December 19, 2008; auto-renews annually unless notice 60 days prior to term end . |
| Non-compete / non-solicit | In effect during employment and for two years post-termination; confidentiality covenants apply . |
| Termination without Cause / Good Reason (no CoC) | Severance equal to the greater of remaining-term salary or 1x (base salary + prior year bonus); all equity accelerates . |
| Termination in connection with Change in Control (double trigger for cash) | If terminated by Company for any reason other than Cause within 90 days prior to or 24 months following a CoC: 2.99x (base salary + prior-year bonus) plus 3 months benefits and up to $20,000 outplacement . |
| CoC equity treatment | For Walters, RSUs fully vest immediately prior to CoC at maximum 130% for performance RSUs . |
| 280G / tax gross-up | Tax gross-up for any excise or similar taxes triggered by CoC severance; Company also grosses up taxes due on the gross-up itself . |
| Example quantum (as of 2/28/2025) | CoC termination: $9,696,891 total for Walters (Severance $4,768,506; Benefits $6,978; Outplacement $20,000; Pension $1,467,747; Equity $3,433,660) . Non-CoC without Cause/Good Reason: $6,523,203 total (Severance $1,594,818; Benefits $6,978; Outplacement $20,000; Pension $1,467,747; Equity $3,433,660) . |
Board Governance
- Roles and independence:
- Walters serves as Chairman and CEO; the Board does not mandate separation but reviews annually; the Chair of the Nominating Committee serves as Lead Director (was John Blind until his retirement) .
- CEO cannot serve on any Board committees; all three standing committees (Audit, Compensation, Nominating) are fully independent .
- Margaret A. Walters (spouse) is a non-independent director; Gary S. Mozina is non-independent due to ongoing IPG-related arrangements; a majority of the Board is independent .
- Committees and attendance:
- Audit (Chair: Michael Schaefer), Compensation (Chair: Alejandro Quiroz), Nominating (Chair: John Blind/Lead Director) .
- In FY2025 the Board met six times; no director attended fewer than 75%; all directors attended the 2024 annual meeting .
- Director pay and stock policy:
- Non-employee directors receive cash retainers/meeting fees and annual restricted stock; employee directors (Walters) receive no Board pay .
- Non-employee directors must hold 6x annual retainer within five years; hedging/pledging prohibited .
Compensation Structure Analysis (signals)
- Mix shift and rigor:
- Significant LTIP redesign: adoption of 3-year performance RSUs weighted to EBITDA and ROE with TSR modifier; time-based RSUs now 40% with special conversion to options for non-compliant NEOs—strengthens alignment and retention .
- Annual bonus metrics cover revenue, profitability, and ROE; FY2025 outcomes demonstrate formulaic payments with no discretion .
- Shareholder feedback history:
- Say-on-pay received low support in 2018 (52%) and failed in 2019–2020 (46% support in 2020), followed by outreach and structural changes; subsequent plans approved by substantial majorities after 2021 LTIP refresh .
- Red flags:
- CEO combined with Chairman and spouse on Board raise independence/entrenchment concerns despite Lead Director structure .
- 280G tax gross-up for Walters persists—a shareholder-unfriendly feature largely eliminated at many peers .
- Offsets:
- Large personal ownership (2.3%) and strict anti-pledging policy support alignment and reduce financing risk; executive ownership guidelines further reinforce alignment .
Multi-Year CEO Compensation (Summary Compensation Table)
| Metric ($) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Salary | 1,003,895 | 1,035,110 | 1,066,164 |
| Bonus | — | — | — |
| Stock Awards (Grant-Date FV) | — | — | 3,433,660 |
| Option Awards | — | — | — |
| Non-Equity Incentive Plan Comp | 1,616,995 | 522,649 | 650,224 |
| Change in Pension Value | — | 112,762 | 142,632 |
| All Other Comp (Perqs) | 12,000 | 12,000 | 12,000 |
| Total | 2,632,890 | 1,682,521 | 5,304,680 |
Company Performance Context
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Revenues ($) | 357,973,000* | 400,014,000* | 431,837,000* | 420,109,000* | 394,618,000* |
| EBITDA ($) | 52,495,000* | 61,573,000* | 76,936,000* | 72,778,000* | 67,166,000* |
| Net Income ($) | 24,094,000 | 28,982,000 | 47,300,000 | 42,597,000 | 40,222,000 |
| Return on Equity (%) | 8.1% | 9.6% | 14.9% | 12.5% | 12.3% |
| TSR (Value of $100) | 103.62 | 103.08 | 125.43 | 122.94 | 150.98 |
Values with an asterisk (*) were retrieved from S&P Global.
Director-Specific Notes for Walters (Board service history, committees, dual-role implications)
- Service: Director since 1997; current term expires 2026 .
- Committees: As CEO, not a member of committees; all committees are independent .
- Attendance: Board met 6x in FY2025; no director <75% attendance; all attended 2024 annual meeting .
- Dual-role implications: Board permits combined Chair/CEO given strong Lead Director function (Nominating Chair) and regular executive sessions of independent directors; however, spouse’s presence as a non-independent director presents additional independence considerations .
Additional Governance, Contracts, and Risks
- Clawback: Board considered adopting a clawback policy; concluded not necessary for long-tenured management at that time, with potential application for newer executives in future .
- Related-party dynamics: Non-independent director Gary Mozina due to ongoing sourcing and lease with former IPG business; spouse Margaret Walters serves as a director; majority of Board remains independent .
- Succession: Board has reviewed succession planning given management age; implemented leadership changes following retirements in FY2025; no current CEO retirement plan disclosed .
Investment Implications
- Alignment and performance: Walters’ pay is heavily equity-linked via a rigorous 3-year plan using EBITDA/ROE with a TSR modifier; annual bonus is formulaic across sales, profit, and ROE; combined with 2.3% ownership and anti-pledging rules, incentives generally align with shareholders .
- Governance risks: Persistent 280G tax gross-up, combined Chair/CEO structure, and spouse on the Board are notable governance red flags that could affect proxy advisor views and say-on-pay support in adverse years .
- Event risk and retention: Walters’ equity accelerates at maximum on CoC and severance is 2.99x cash (double-trigger) with a gross-up—these terms create a meaningful transaction payout that could influence M&A optionality and retention calculus around strategic events .
- Succession considerations: At age 76 with long tenure, CEO transition timing remains a medium-term focus; Board disclosures highlight ongoing succession planning, which should be monitored for execution risk following recent retirements of senior officers .
References:
- 2025 DEF 14A Proxy Statement (June 5, 2025) .
- 2024 DEF 14A (June 3, 2024) – severance/gross-up disclosure history .
- 2023 DEF 14A (May 30, 2023) – severance/gross-up disclosure history .
- 2022 DEF 14A (May 26, 2022) – say-on-pay remediation, ownership policy .
- 2021 DEF 14A (June 3, 2021) – say-on-pay failure detail and outreach; clawback discussion .
- 2020 DEF 14A (May 22, 2020) – say-on-pay context and committee/ownership policies .
- Form 8‑K (March 4, 2025) – leadership retirements and director transition .