John Erwin
About John Erwin
John Erwin is Methode Electronics’ Chief Procurement and EHS Officer, joining on July 15, 2024 and promoted on March 20, 2025, with responsibility for global supply chain and environmental, health, and safety initiatives . His FY2025 pay mix combines base salary, an annual performance bonus tied to pre-tax income and free cash flow, and RSU/PSU long‑term awards linked to three‑year annualized TSR . Company context during his tenure: FY2025 net loss was $62.6 million and EBITDA was $30.4 million, while five‑year TSR (from a $100 base in FY2020) was $27 vs. $209 for the peer group . Stock ownership guidelines require 3x salary for executive officers, with hedging and pledging prohibited and a clawback policy in place .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Methode Electronics (MEI) | Chief Procurement Officer | Jul 15, 2024 – Mar 20, 2025 | “Back to basics” transformation priorities: plant optimization, stronger inventory management, unified global supply chain; 22 program launches in FY2025 . |
| Methode Electronics (MEI) | Chief Procurement & EHS Officer | Mar 20, 2025 – Present | Continued focus on execution, cost reduction, remediation of practices, and leverage of synergies to position for future growth . |
Fixed Compensation
| Component | FY2025 Value | Notes |
|---|---|---|
| Base Salary | $425,000 | Increased from $400,000 effective Jan 15, 2025 for contributions . |
| Target Annual Bonus | 50% of salary, increased to 66% (prorated) | Bonus metrics: 70% pre‑tax income, 30% free cash flow; threshold 50%, max 200% . |
| Actual Annual Bonus Paid | $149,446 | Committee approved weighted plan payout of 76% of target; certain execs received $25,000 individual modifiers; Erwin received a modifier . |
| Sign‑On RSUs (grant‑date value) | $218,020 | Vesting: 50% on each of first two anniversaries of start date (Jul 15, 2025; Jul 15, 2026) . |
| FY2025 LTI: Time‑based RSUs | $112,720 (value at grant) | 11,156 RSUs; vest one‑third annually beginning Sep 11, 2025 . |
| FY2025 LTI: Performance‑based RSUs (PSUs) | $112,720 (value at target) | 11,156 PSUs at target; vest based on annualized TSR (10%/15%/20% → 50%/100%/200%) for FY2025–FY2027 . |
| Additional FY2025 LTI grant | $23,288 (value) | Committee award in Dec 2024; 50% RSUs/50% PSUs . |
| Other Compensation | $78,597 | Includes 401(k) contribution $8,288, life insurance $615, phone allowance $500, and $69,194 paid while consulting Jul–Aug 2024 . |
Performance Compensation
FY2025 Annual Bonus Design and Payout
| Metric | Weight | Threshold | Target | Target+ | Maximum | FY2025 Plan Payout | Erwin FY2025 Result |
|---|---|---|---|---|---|---|---|
| Pre‑tax income | 70% | $0 (50%) | $3,140,000 (100%) | $9,710,000 (150%) | $22,065,000 (200%) | Committee approved weighted 76% of target after limited addbacks | $149,446 vs. $163,745 target (modifier applied) . |
| Free cash flow | 30% | $(2,541,368) (50%) | $598,632 (100%) | $12,168,632 (150%) | $29,523,632 (200%) | Committee approved weighted 76% of target after limited addbacks | Included in total bonus outcome above . |
Notes:
- Committee originally considered broader addbacks (FX, unplanned interest, legal settlement, inventory impairments) that would have paid 122.2% (pre‑tax) and 115.5% (FCF); ultimately approved a 76% weighted payout plus selective individual modifiers .
FY2025–FY2027 Long‑Term Incentive (TSR PSUs) and RSUs
| Award Type | Weight | Grant | Metrics / Targets | Payout Curve | Vesting |
|---|---|---|---|---|---|
| PSUs (TSR) | 50% | 11,156 PSUs at target | Annualized TSR: threshold 10%, target 15%, max 20% | 50% / 100% / 200% of target | After FY2027 with committee certification; death/disability → vest at target . |
| RSUs (time‑based) | 50% | 11,156 RSUs | N/A | N/A | One‑third annually beginning Sep 11, 2025; death/disability → full vest . |
| Additional FY2025 LTI | — | $23,288 (50% RSUs/50% PSUs) | Same TSR framework | Same curve | Same schedules . |
Equity Ownership & Alignment
Beneficial Ownership (as of Jul 24, 2025)
| Holder | Shares Beneficially Owned | % of Class | Notes |
|---|---|---|---|
| John Erwin | 16,038 | <1% | Includes 14,400 RSUs vesting on Sep 11, 2025 and 1,638 shares in 401(k) . |
Outstanding Equity Awards (as of May 3, 2025; price $6.68)
| Award | Quantity | Market Value | Vesting Notes |
|---|---|---|---|
| Unvested RSUs | 33,156 | $221,482 | Mix of sign‑on RSUs (50% on each of first two anniversaries) and LTI RSUs (one‑third annually from Sep 11, 2025) . |
| PSUs at target | 11,156 | $74,552 | Payout based on FY2025–FY2027 annualized TSR with threshold/target/max . |
Alignment & policies:
- Ownership guideline: 3x salary for executive officers; 50% compliance within 3 years, 100% within 5 years; if below, must retain 75% of net shares from equity vest/exercise until met; all execs in compliance subject to phase‑in .
- Prohibition on hedging/derivatives, short sales, margin accounts, and pledging; no excise tax gross‑ups; clawback policy for material non‑compliance restatements .
Employment Terms
- Offer Letter: base salary $400,000 (raised to $425,000 Jan 15, 2025), target bonus 50% (raised to 66% prorated), FY2025 LTI target $320,000 (raised to $400,000 prorated), sign‑on RSUs $218,020 (50% vest on each of first two anniversaries), temporary housing & travel reimbursement .
- Change‑of‑Control: Double trigger; if terminated without cause or resigns for good reason within two years of a change of control/pending change, executives receive 2x salary and 2x target bonus, plus COBRA premiums for two years; performance and time‑based awards vest per plan terms .
- Severance: Company discloses that Erwin entered into a severance agreement in fiscal 2026 (terms not detailed in FY2025 proxy) .
- Bonus payout mechanics: FY2025 weighted payout approved at 76% amid transformation and select addbacks; some executives received $25,000 individual performance modifiers .
Investment Implications
- Pay‑for‑performance: Annual bonus tied to profitability and cash generation, with TSR‑linked PSUs creating explicit shareholder alignment; however, committee addbacks and discretionary modifiers in FY2025 introduce judgment risk in bonus outcomes .
- Vesting calendar and potential selling pressure: Sign‑on RSUs (50% each) around Jul 15, 2025/2026, plus LTI RSUs starting Sep 11, 2025; monitor insider Form 4 activity and blackouts for supply effects near these dates .
- Retention and continuity: Multi‑year RSU/PSU schedules, 3x salary ownership guideline with retention requirements, and double‑trigger CoC protections mitigate immediate departure risk; severance agreement (FY2026) further stabilizes retention incentives .
- Execution risk vs. incentives: FY2025 results included net loss and modest EBITDA amid transformation; TSR PSUs emphasize three‑year performance recovery, aligning Erwin’s upside with delivery on execution and cash flow priorities .