Michael Foster
LSB INDUSTRIESAbout Michael Foster
Michael J. Foster, age 58, serves as Executive Vice President, General Counsel and Secretary of LSB Industries, Inc. (LXU). He joined LSB in January 2016 and was appointed EVP, General Counsel & Secretary on December 30, 2018; he holds a B.S. in Agriculture Science (University of Illinois Urbana-Champaign) and a J.D. (University of Tulsa) . Company performance metrics tied to pay show relative TSR as the long-term metric and Adjusted EBITDA as the core annual metric; Adjusted EBITDA declined from $414.7M (2022) to $132.7M (2023) and $129.5M (2024), while TSR (value of $100) fell from 510 (2022) to 357 (2023) and 291 (2024) . LSB’s executive pay program incorporates safety (TRIR/PSI/environmental events), Adjusted EBITDA, and ammonia production metrics, aligning compensation with operational and financial outcomes .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| LSB Industries, Inc. | Senior Vice President, General Counsel & Secretary | 2016–2018 | Led legal function post-capital structure changes; supported governance and compliance |
| LSB Industries, Inc. | Executive Vice President, General Counsel & Secretary | 2018–present | Executive leadership; oversight of legal, corporate governance, SEC compliance; signatory on SEC filings |
| Tronox (NYSE:TROX) | Senior Vice President, General Counsel & Secretary | 2007–2014 | Led global legal function for mining/manufacturing; supported spin-off and corporate separations |
| Tronox | Managing Counsel | Pre-2007 (prior to spin-off) | Managed legal operations during spin-off from Kerr-McGee |
| Kerr-McGee | Legal team member | Prior to Tronox spin-off | Upstream/midstream energy legal experience |
| Midstream energy industry | Legal/industry roles | ~5 years | Regulatory and commercial legal execution |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Private practice of law | Attorney | Immediately prior to LSB (2015–2016) | Advisory and litigation experience before joining LSB |
Fixed Compensation
| Year | Base Salary ($) | All Other Compensation ($) | Notes |
|---|---|---|---|
| 2024 | 430,769 | 7,948 (auto allowance and spouse meals) | 2025 base salary increased to $450,000 |
| 2023 | 417,585 | 7,800 | — |
| 2022 | 401,400 | 7,800 | — |
| As of Year-End | 2024 Base Salary ($) | 2025 Base Salary ($) |
|---|---|---|
| Michael J. Foster | 434,000 | 450,000 |
Performance Compensation
Annual STI (2024)
| Component | Weight | Target | Actual | Weighted Payout | Notes |
|---|---|---|---|---|---|
| Safety & Environmental (TRIR/PSI/Reportable Events) | 25% | Company goals | Achievement 17.0% | 4.2% | — |
| Adjusted EBITDA | 50% | Budget | Achievement 97.0% | 48.4% | — |
| Ammonia Production Rates | 25% | Budget | Below threshold | 0.0% | — |
| Overall STI Multiplier | — | — | 101% | — | — |
| Payout (% of Target) | — | 70% target bonus | 53% | — | Paid $161,000 |
| 2024 STI Outcome for Foster | Amount ($) |
|---|---|
| STI Plan Payment | 161,000 |
Long-Term Incentives (Structure)
- 2024 LTIP grants: mix of time-based RSUs (vest 1/3 annually over 3 years) and PSUs based on relative TSR vs fertilizer/chemicals peer group; PSUs vest after 3-year performance period with 50–200% payout range capped at target if absolute TSR is negative .
- No options or SARs outstanding for executives; company policy prohibits repricing .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 310,209 common shares (as of March 24, 2025) |
| Ownership as % of outstanding | ~0.43% (310,209 ÷ 71,876,502 shares outstanding) |
| Stock Ownership Guidelines | 3x base salary for other executive officers (CEO 5x); measured annually; includes owned shares, time-based RSUs, target PSUs |
| Compliance Status | As of Dec 31, 2024, each NEO (including Foster) met or exceeded guidelines |
| Pledging/Hedging | Prohibited for directors/officers; pre-clearance required; anti-hedging policy in place |
| Clawback | Recoupment Policy (2023) consistent with SEC/NYSE—for erroneous incentive pay upon restatements |
| Section 16 Compliance | One late Form 4 in 2024 related to RSU grant (also for other NEOs) |
Outstanding and Vesting Equity (as of Dec 31, 2024)
| Grant Date | Award Type | Units Not Vested (#) | Vesting Terms |
|---|---|---|---|
| 1/20/2022 | Time-based RSUs | 6,473 | Vested/forfeited at 1/20/2025 per plan |
| 1/20/2022 | PSUs (TRS-based) | 6,473 | Earned over 3 years; vested 1/20/2025 |
| 1/25/2023 | Time-based RSUs | 11,400 | 1/25/2024, 1/25/2025, 1/25/2026 (annual thirds) |
| 1/25/2023 | PSUs (relative TSR) | 17,099 | Scheduled to vest 1/25/2026 (subject to cumulative TSR) |
| 1/17/2024 | Time-based RSUs | 28,218 | 1/17/2025, 1/17/2026, 1/17/2027 (annual thirds) |
| 1/17/2024 | PSUs (relative TSR) | 28,217 | Scheduled to vest 1/17/2027 (subject to cumulative TSR) |
Employment Terms
| Provision | Foster Terms |
|---|---|
| Agreement | 2018 employment agreement; initial 1-year term with automatic 1-year renewals |
| Role | EVP, General Counsel & Secretary |
| Base Salary (floor) | ≥$390,000 (agreement minimum) |
| Target Bonus | 70% of base; opportunity range 0–140% |
| Non-compete/Non-solicit | 24 months post-termination |
| Double Trigger CIC | Applies (requires both CIC and qualifying termination) |
| Health Coverage | 18 months company-paid employer portion post-qualifying termination |
Severance and Change-in-Control Economics (as of 12/31/2024)
| Scenario | STI Payment ($) | Cash Severance ($) | Equity Acceleration ($) | Health Coverage ($) | Total ($) |
|---|---|---|---|---|---|
| Termination for Cause | 161,000 | — | — | — | 161,000 |
| Termination Without Cause / For Good Reason | 161,000 | 737,800 | 742,909 | 23,356 | 1,665,065 |
| Termination During CIC Period (double trigger) | 161,000 | 1,475,600 | 742,909 | 23,356 | 2,402,865 |
| CIC Without Termination | 161,000 | — | 742,909 | — | 903,909 |
| Death | 161,000 | — | 355,204 | — | 516,204 |
| Disability | 161,000 | — | 355,204 | — | 516,204 |
Notes:
- Non-CIC severance: lump sum 1× (base + target bonus) + 18 months health coverage; time-based RSUs vest; PSUs vest pro-rata based on actual performance at period end .
- CIC severance: lump sum 2× (base + target bonus) + 18 months health coverage; if awards not assumed/substituted at CIC, time-based RSUs vest in full; PSUs earned at greater of target or performance determined pre-CIC .
- No options outstanding; equity is RSU/PSU .
Multi-Year Compensation (Named Executive Summary)
| Year | Salary ($) | Stock Awards ($) | Non-Equity Incentive ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|
| 2024 | 430,769 | 551,380 | 161,000 | 7,948 | 1,151,097 |
| 2023 | 417,585 | 563,583 | 223,000 | 7,800 | 1,211,968 |
| 2022 | 401,400 | 456,273 | 389,000 | 7,800 | 1,254,473 |
Company Performance Context
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 901,711,000 | 593,709,000 | 522,400,000 |
| EBITDA ($) | 376,534,000* | 123,804,000* | 80,475,000* |
Values retrieved from S&P Global.*
Pay-versus-performance (as disclosed in proxy):
- TSR (value of $100 initial investment): 510 (2022), 357 (2023), 291 (2024) .
- Adjusted EBITDA ($ thousands): 414,653 (2022), 132,664 (2023), 129,520 (2024) .
Governance and Shareholder Signals
- Say-on-pay 2025: For 50,880,212.93; Against 919,893; Abstain 122,774; broker non-votes 13,110,260.07; approval passed (≈98% of votes cast) .
- Insider policies: anti-hedging/pledging; stringent pre-clearance; clawback policy updated in 2023 .
- LTIP refresh: 2025 LTIP approved; 4,000,000 shares authorized; no repricing allowed; flexibility for RSUs/PSUs/SARs/other .
Investment Implications
- Alignment: Foster’s pay design is heavily at-risk via STI and TSR-based PSUs; ownership guideline compliance and prohibitions on pledging/hedging support strong alignment with shareholders .
- Retention/pressure: No options outstanding limits forced exercise pressure; however, sizeable scheduled RSU/PSU vesting in 2026–2027 (11,400 RSUs, 17,099 PSUs; 28,218 RSUs, 28,217 PSUs) could create periodic liquidity events—watch for 10b5‑1 filings and Form 4 activity .
- Change-in-control economics: Double-trigger structure with 2× cash multiple plus equity acceleration (if not assumed) is standard, not excessive; severance math is transparent and capped relative to salary/bonus .
- Performance linkage: 2024 STI paid 53% of target amid sub-threshold ammonia output and modest safety score, offset by near-budget Adjusted EBITDA—indicative of balanced scorecard discipline . With multi-year declines in Adjusted EBITDA and TSR through 2024, TSR-based PSUs may cap at target if absolute TSR is negative, constraining upside payouts .
- Governance risk: One late Form 4 (administrative) and robust clawback/anti-hedging/pledging policies suggest low governance red flags; monitor say-on-pay trends (high approval in 2025) and any future changes to peer group or metrics that could inflate payouts .