Alex LaRue

About Alex LaRue

Alex LaRue (age 39) is Chief Financial Officer — Secretary & Treasurer of Friedman Industries (FRD), a role he has held since March 2018 after successive finance roles since 2011, signaling deep company-specific operating and capital markets familiarity . During FY2023–FY2025, FRD’s total shareholder return (TSR) on a $100 basis moved from $128.72 (FY2023) to $212.71 (FY2024) and then to $169.01 (FY2025), while net earnings moved from $21.3M (FY2023) to $17.3M (FY2024) and $6.1M (FY2025); bonuses are discretionary and decreased materially alongside earnings in FY2025, indicating sensitivity of pay to performance . FRD FY2025 net sales were $444.6M (vs. $516.3M in FY2024), reflecting steel price volatility and lower average selling prices; hedging gains partly offset margin pressure .

Past Roles

External Roles

Fixed Compensation

Notes:

• Bonuses are discretionary (company performance and Christmas bonus), not tied to pre-set formulaic metrics in the proxy disclosure .

Performance Compensation

Performance plan design detail (metrics, weighting, targets, actuals, payout):

• Not disclosed; the proxy does not enumerate specific performance metrics or weightings for executive bonuses in FY2024–FY2025 .

Pay versus performance context (company and NEO):

Equity Ownership & Alignment

• Beneficial ownership: 31,646 FRD shares; ownership percentage under 1% per the proxy table .
• Outstanding equity and vesting:
  • 1,000 unvested restricted shares as of 3/31/2025; scheduled to vest on April 1, 2025; grant fair value marked to $14,890 at 3/31/2025 (closing price $14.89) .
  • No stock options outstanding .

Policies affecting alignment and trading:

• Insider Trading Policy prohibits Restricted Persons from transacting in options/derivatives on FRD and requires pre-clearance for transactions including pledges; 10b5-1 plans allowed with pre-clearance .
• Executive compensation clawback policy (Rule 10D-1 compliant) requires recovery of erroneously awarded incentive compensation in the three completed fiscal years preceding a required restatement; no indemnification for recovered amounts .

Stock ownership guidelines (executives): Not disclosed in the proxy/10-K .

Employment Terms

Change-in-control (CIC) and severance economics:

• Plan: Friedman Industries Key Employee Change in Control Severance Plan (effective Sept 18, 2024) .
• Triggers: Double trigger — “Involuntary Termination” (good reason resignation or termination without cause) during the CIC period (3 months prior to and 18 months post-CIC) .
• CIC definition: Includes 30% beneficial ownership, merger not controlled by incumbent holders, loss of incumbent board majority, sale of substantially all assets, or liquidation approval .
• Benefits for CFO (LaRue):
  • Cash severance = 2x (base salary + average annual bonus of prior 3 years) .
  • Pro-rata bonus for year of termination (avg of prior 3 years, pro-rated) .
  • Health benefits cash payment = 2x 12 months of company monthly contributions for medical/dental/vision .
  • Outplacement up to $10,000 .
  • Release requirement; offsets for other severance benefits .

Equity plan terms affecting vesting/acceleration:

• 2016 Restricted Stock Plan had 113,972 shares remaining as of 3/31/2025 .
• 2025 Long-Term Incentive Plan (subject to shareholder approval) authorizes up to 550,000 shares; permits options (ISOs/NQSOs), SARs, restricted stock, RSUs, other stock- and cash-based awards; minimum 1-year vesting (with limited exceptions) .
• On Corporate Change, the plan allows acceleration, cash-out, assumption/substitution, or adjustments at the Committee’s discretion (not automatic single-trigger acceleration) .

Investment Implications

• Pay-for-performance: LaRue’s FY2025 bonus fell sharply vs FY2024 (from $437k to $93k) as net earnings declined (from $17.3M to $6.1M), indicating practical linkage of cash pay to results despite absence of disclosed formulaic metrics .
• Low near-term selling pressure: Only 1,000 restricted shares were scheduled to vest on 4/1/2025 (≈$14.9k at 3/31/2025 price), with no options outstanding; ownership is 31,646 shares (<1%), suggesting limited forced selling from vesting events .
• Retention and deal incentives: Double-trigger CIC severance at 2x salary+bonus, plus benefits and outplacement, provides competitive protection without single-trigger acceleration; combined with discretionary bonuses, this structure is retention-supportive but not overly generous for a CFO role at FRD’s scale .
• Future equity alignment and dilution: The proposed 2025 LTIP (550,000 shares) materially increases capacity for equity grants (RSUs/PSUs/options), potentially enhancing alignment if performance conditions are adopted, but also introducing dilution risk; minimum 1-year vesting is shareholder-friendly .
• Governance guardrails: FRD has a compliant clawback policy and insider trading controls (preclearance, hedging/derivatives prohibitions for Restricted Persons); no disclosure of pledging by LaRue, reducing alignment risk flags often tied to pledging .

Appendices

Summary Compensation (NEO - Alex LaRue)

Outstanding Equity Awards (FY-end 2025)

Beneficial Ownership (as of July 28, 2025)

Company Results Context

Policies and Plans Referenced

• Insider trading policy: preclearance for Restricted Persons; prohibits derivatives on FRD; 10b5-1 permitted with preclearance .
• Clawback policy: recovery of incentive compensation upon restatement (3 fiscal years), Rule 10D-1 compliant .
• 2016 restricted stock plan availability at 3/31/2025: 113,972 shares .
• 2025 LTIP: authorize 550,000 shares; award types; minimum 1-year vest; Corporate Change alternatives (acceleration/assumption/cash-out/adjustments) .
• CIC severance plan (effective 9/18/2024): CFO multiple 2x; double-trigger; terms as summarized above .