Joseph Berquist
QUAKER CHEMICALAbout Joseph Berquist
Joseph A. Berquist is Chief Executive Officer and President of Quaker Houghton (KWR) and has served as a director since November 18, 2024; he is not independent and holds no board committee roles. He is 53 years old and previously served as EVP, Chief Commercial Officer (Jan 1, 2023–Nov 18, 2024) after multiple strategy and regional leadership roles since 2010, giving him deep institutional and industry operating experience . In 2024, the company’s AIP metrics paid 0% on Adjusted EBITDA (actual $310.9m vs $320m threshold), 200% on New Business Wins (6.8%), and 178% on safety (TRIR 0.3345), translating to ~77% of target for global participants; Berquist’s AIP payout was $276,425 (77% of target) . From his appointment date to year-end, KWR’s share price moved from $167.14 (11/18/24) to $140.76 (12/31/24), indicating near‑term share price pressure into 2025 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Quaker Houghton | CEO & President | Nov 18, 2024–Present | Enterprise leadership during CEO transition; alignment of incentives (AIP to 100% target for 2025) . |
| Quaker Houghton | EVP, Chief Commercial Officer | 2023–Nov 18, 2024 | Global commercial leadership; AIP outcomes reflect strong NBW and safety execution in 2024 . |
| Quaker Houghton | EVP, Chief Strategy Officer & Managing Director, Global Specialty; Interim MD EMEA | 2019–2022 (Interim EMEA Aug–Dec 2022) | Strategy, M&A, global specialty portfolio oversight; interim regional leadership . |
| Quaker Houghton | VP & Managing Director – North America | 2010–2019 | Led North America region operations/commercial . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | No current or prior public company boards disclosed in past five years . |
Fixed Compensation
Multi‑year compensation as reported (Summary Compensation Table):
| Metric | 2022 ($) | 2023 ($) | 2024 ($) |
|---|---|---|---|
| Salary | 512,856 | 535,933 | 575,731 |
| Bonus (Discretionary) | — | — | — |
| Stock Awards (Grant-date FV) | 338,379 | 789,316 | 1,012,878 |
| Option Awards (Grant-date FV) | 166,639 | — | — |
| Non-Equity Incentive Plan (AIP) | 201,825 | 570,375 | 276,425 |
| All Other Compensation | 26,404 | 32,976 | 32,082 |
| Total | 1,246,103 | 1,928,600 | 1,897,116 |
2024 salary rate progression and 2025 target pay levers:
- 2024 salary rates: initial $540,000; merit increased to $555,000 (Mar 2024); CEO rate $800,000 effective Nov 18, 2024; 2024 salary paid $575,731 .
- AIP target: 65% of base for 2024; increased to 100% as CEO effective Jan 1, 2025 .
Other 2024 perquisites (All Other Compensation detail):
| Item | Amount ($) |
|---|---|
| Retirement Savings Plan contributions | 20,711 |
| Dividends on time‑based restricted awards | 4,496 |
| Personal financial planning | 1,875 |
| Executive physical/concierge medical | 5,000 |
Performance Compensation
Annual Incentive Plan (AIP) – 2024 Design and Outcomes
| Metric | Weight | Threshold | Target | Max | 2024 Actual | Payout vs Target |
|---|---|---|---|---|---|---|
| Adjusted EBITDA | 60% | $320m | $340m | $375m | $310.9m | 0% |
| New Business Wins (NBW) | 25% | 2% | 3% | 4% | 6.8% | 200% |
| ESG: Safety (TRIR) | 15% | 0.37 | 0.35 | 0.33 | 0.3345 | 178% |
| Individual Performance Modifier | — | — | — | 200% cap | Applied | Global payout ~77% of target |
Berquist’s 2024 AIP: Target $360,750 (65% of $555,000 base), Actual $276,425 (77% of target) .
AIP governance update: Starting 2025, if Adjusted EBITDA falls below threshold, payouts for other measures are capped at target, strengthening pay‑for‑profitability linkage .
Long-Term Incentives (LTIP) – 2024 Grants and Structure
2024 grants (target PSUs and time-based RSUs; three-year performance/vesting):
| Grant Date | Type | Target/Units | Notes | Grant-date FV ($) |
|---|---|---|---|---|
| 3/15/2024 | PSUs | 2,098 | RTSR vs Chemicals Index peer set; 3‑yr avg adjusted ROIC; 0.5x–2.0x payout range | — |
| 3/15/2024 | RSUs | 1,398 | Ratable over 3 years | 735,457 |
| 3/15/2024 | RSUs (retention) | 1,386 | Ratable over 3 years; leadership stability | 277,421 |
Vesting/realization in 2024:
- Stock vested: 1,876 shares; value realized $375,500; vesting dates aligned to 2/27/24 and 3/15/24 schedules .
- No option exercises in 2024 .
Outstanding equity at 12/31/2024 (supply and underwater optionality):
| Category | Detail | Amount |
|---|---|---|
| Options (exercisable) | 1,319 @ $245.49 exp. 3/15/2028 | Underwater vs $140.76 close |
| Options (exercisable/unexercisable) | 1,461/1,011 @ $178.29 exp. 3/16/2029 | Underwater vs $140.76 close |
| Time-based RSUs (unvested) | 934 units (vesting 3/16/2025); $131,470 MV | |
| Additional time-based RSUs | 1,409 units; $198,331 MV | |
| Additional time-based RSUs | 1,396 units; $196,501 MV | |
| PSUs (unearned target sets) | 1,164 units; $163,845 MV | Performance-based |
Note: Market values use $140.76 closing price on 12/31/2024 . Option vesting: generally one‑third annually over three years from grant; underwater status reduces near-term exercise pressure .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (3/4/2025) | 15,805 shares; <1% of outstanding; includes 3,791 options exercisable within 60 days . |
| Ownership guidelines (officers) | CEO required to hold 5x base salary; other NEOs 2.5x salary; compliance assessed annually; all NEOs in compliance as of June 30, 2024 . |
| Hedging/recoupment policies | Company has Employee, Officer and Director Hedging and Compensation Recoupment Policies (governance framework) . |
| Director stock ownership (board) | Independent directors must hold 500% of annual retainer; mechanisms to increase equity-paid retainers if below threshold; Lead Director retainer $20,000; Non‑exec Chair retainer $100,000 . |
Potential insider selling pressure signals:
- Near-term RSU vesting on/around March 16, 2025 (934 time-based RSUs scheduled; plus other 2024 RSU tranches with ratable vesting) could create event‑driven liquidity around vest dates .
- Options are underwater at 12/31/2024 ($245.49 and $178.29 strikes vs $140.76), reducing exercise/sale drivers unless shares re-rate materially .
Employment Terms
- At-will with 90 days’ notice; eligible for AIP and LTIP; board reviews/adjusts base salary .
- Severance (non‑CIC): If terminated other than for cause or death, severance equals 18 months of salary and target bonus paid over 18 months; 18 months medical/dental continuation; one year outplacement; 18‑month non‑compete and non‑solicit; death benefit equal to 100% of base salary in year of death and 50% annually for four years thereafter .
- Change in Control (double trigger): If terminated without cause or for good reason within two years post‑CIC, cash severance equals 2x (highest annualized base) + average AIP over applicable three‑year measurement; pro‑rata AIP at target; pro‑rata LTIP at target; 24 months medical/dental/life; one year outplacement; 280G cutback applies .
- Estimated CIC payout (as of 12/31/2024): Total $3,880,858; includes cash severance $2,322,487; AIP $360,750; PSUs $448,368; RSUs $669,032; benefits/outplacement components .
Board Governance (Director Service and Dual-role Implications)
- Director since 2024; classification “Not Independent”; no committee assignments .
- Board committees are fully independent (other than internal sustainability role of a former executive director historically); 2024 committees and meeting cadence disclosed; all directors attended ≥75% of required meetings in 2024 except one director due to temporary illness; CEO Berquist not on committees .
- Governance mitigants: Lead Director role and non‑executive Chair exist (with specific retainers), which help balance CEO/Board oversight in a CEO-director dual role construct .
Performance & Track Record
- 2024 AIP results reflect mixed execution: below-threshold Adjusted EBITDA (0% payout) offset by strong New Business Wins (200%) and strong safety performance (178%) under Berquist’s executive leadership transition year .
- From appointment through year end 2024, KWR’s share price moved from $167.14 (Nov 18, 2024) to $140.76 (Dec 31, 2024), highlighting near-term market pressure into 2025 against the backdrop of sector-relative RTSR benchmarking in LTIP .
- The 2024–2026 LTIP uses RTSR versus S&P Composite 1500 Chemicals Index and three‑year average adjusted ROIC to align with long‑term value creation; 2020–2024 performance graph shows KWR trailing sector indices by 12/31/2024, providing a tougher comp set for RTSR outcomes .
Compensation Structure Analysis
- Cash vs equity mix: Equity remains significant via PSUs/RSUs; 2024 equity was augmented with one‑time RSUs for retention and leadership stability during the CEO transition, signaling retention focus .
- Shift in risk profile: 2025 AIP adds EBITDA gating (cap on other metrics if EBITDA below threshold), tightening pay-for-profitability; LTIP retains dual performance metrics (RTSR and ROIC) with capped payouts .
- No option repricing or modification disclosed; options remain underwater at YE 2024, reducing windfall risk .
- Use of independent consultant (WTW) in sizing and mix of LTIP awards; peer benchmarking practice disclosed .
Equity Ownership & Beneficial Ownership Detail
| Holder | Shares Beneficially Owned | Approx. % | Options incl. (60‑day) |
|---|---|---|---|
| Joseph A. Berquist | 15,805 | <1% | 3,791 |
Director Compensation (context for dual-role)
- Independent director plan requires 500% of annual retainer in shares; chairs and lead independent director receive additional cash retainers; a non‑executive Chair structure is in place. Executive officers typically do not receive director retainers (not explicitly stated here); the presence of a non‑executive Chair and a Lead Director provides governance counterbalance to CEO service on the board .
Employment Economics Under CIC (Illustrative)
| Component | Joseph A. Berquist ($) |
|---|---|
| Cash Severance | 2,322,487 |
| AIP Payment | 360,750 |
| PSUs (pro‑rata at target) | 448,368 |
| Time‑based RSUs | 669,032 |
| Benefits (Med/Dental/Life) | 55,221 |
| Outplacement | 25,000 |
| Total | 3,880,858 |
Investment Implications
- Alignment: AIP shifted to stricter profitability linkage in 2025; LTIP emphasizes RTSR vs Chemicals peers and ROIC, supporting shareholder alignment. Underwater options reduce immediate exercise/sale pressure; near‑term selling could center around March 2025 RSU vesting dates .
- Retention vs turnover risk: One‑time RSU retention grants in 2024 for leadership continuity during CEO transition, plus competitive CIC protections (double‑trigger, 2x cash multiple), reduce near‑term departure risk but add potential cost in change‑in‑control scenarios .
- Execution risk: 2024 EBITDA miss alongside strong NBW and safety suggests commercial pipeline strength but operating leverage/price-cost dynamics to monitor under new CEO; short window from appointment to YE 2024 saw share price decline from $167.14 to $140.76, reinforcing the importance of 2025 EBITDA delivery under the new AIP gating .
- Governance: CEO also serves as director (not independent), but governance mitigants include a non‑executive Chair and a Lead Director structure with defined retainers, reducing dual-role concentration risk .