Ken Walma

About Ken Walma

Ken Walma is President — Flooring North America at Mohawk Industries (MHK), appointed in February 2025; he is 47 years old and previously led operating roles across industrials and lighting, including CEO of Big Ass Fans and Group President at Madison Air, following leadership roles at Signify and Eaton . In 2024, Mohawk generated $10.8B in sales, $679.5M in free cash flow and ended the year at 1.1x net debt to adjusted EBITDA (context for his business’ scale and incentive metrics) . Long‑term incentives at Mohawk tied to three‑year TSR paid 0% for the most recent cycle (10th percentile vs S&P 500), underscoring pay-for-performance sensitivity; by contrast, business unit and company EPS exceeded 2024 targets, which drove annual and long‑term RSU outcomes for segment leaders (relevant to the role Walma now holds) . Near‑term execution risk in his segment includes a new order management system conversion that management estimates will reduce Q1 2025 operating income by $25–$30M, with remediation underway .

Past Roles

External Roles

• No public company directorships or external board roles disclosed for Walma in Mohawk’s 2025 proxy .

Fixed Compensation

• Company structure: base salary set annually based on role scope, market data and performance; other elements (annual bonus, RSUs) are at‑risk .
• Benchmark context (not Walma-specific): upon promotion to President & COO effective Feb 1, 2025, Paul De Cock’s annualized base salary was set at ~$1.2M (illustrative of senior operator pay scale at MHK) .

Performance Compensation

Annual incentive plan (SEAIP) design and 2024 outcomes (relevant to Walma’s role going forward)

• Metrics: Company EPS; for Flooring North America leadership, a 25% weighting on Company EPS and 75% weighting on Flooring North America segment EPS .
• Target opportunity for the 2024 occupant of Walma’s role (Paul F. De Cock): Threshold 42% of salary, Target 70%, Maximum 140% .
• 2024 results: Company EPS achieved 9.70 (above 9.23 target); Flooring North America EPS achieved 1.99 (above 1.49 target) .
• Paid amounts (NEO reference): De Cock earned $1,059,561 for 2024 under the Annual Incentive Plans (Walma’s 2025 payout will depend on 2025 goals/results) .

Long-term incentives (Senior Executive LTIP) structure and latest cycle

• Vehicles: RSUs with a fixed component (as % of salary) plus a variable component tied to (i) three-year relative TSR vs S&P 500 and (ii) company/business unit financial goals; vests ratably over 3 years .
• TSR component: 3‑year TSR at 10th percentile → 0% of TSR-linked awards granted in 2024 (strong alignment to shareholder returns) .
• Business unit RSUs (2024 grants for NEOs based on 2023 goals): example awards include 1,290 RSUs to the Flooring North America leader under business unit performance; fixed RSUs for the same leader were 2,998 RSUs (illustrative scale) .

Equity Ownership & Alignment

• Stock ownership guidelines (executives): CEO 6x salary; COO 3x; CFO and business segment leaders (Walma’s category) 2x; others 1x. Executives must retain 50% of net shares from LTIP until reaching guidelines .
• Compliance: “As of April 1, 2025, all of the Company’s directors and executive officers have met their stock ownership requirements” (company disclosure) .
• Clawback: NYSE/SEC‑compliant policy adopted Oct 2, 2023; requires recovery of incentive‑based pay following an accounting restatement .
• Hedging/Pledging: Hedging (short sales, puts/calls) is prohibited for directors/officers; the proxy notes at least one director with pledged shares via a family limited partnership (no pledging disclosure specific to Walma) .
• Beneficial ownership: Walma’s individual share count and Form 3/4 filings were not included in the 2024 NEO ownership tables; monitor forthcoming Section 16 filings for his initial and subsequent holdings (Form 3/4) .

Employment Terms

• Status/Severance: Company discloses that named executive officers (other than Mr. Vandini) are at‑will and participate in the general employee severance plan (weeks of pay based on service and reason); Walma’s specific agreement was not disclosed in the 2025 proxy .
• Change‑of‑control (2017 Plan): Unvested options/RSUs vest upon a change in control if awards are not assumed; if assumed/equitably converted, vesting accelerates on a “double trigger” (termination without cause or resignation for good reason within 1 year of the change in control). Death/disability also accelerates vesting .
• Non‑compete/Non‑solicit: Not disclosed for Walma. Reference point: a prior employment agreement for the Flooring NA leader included a two‑year non‑compete/non‑solicit post‑separation (agreement has since terminated with that executive’s promotion) .

Investment Implications

• Pay-for-performance alignment: The TSR component paid 0% for the last cycle (10th percentile), while EPS/business‑unit results triggered RSUs and cash bonuses—indicating incentives are levered to both absolute/relative value creation and operating execution .
• Segment scorecard visibility: For the Flooring North America role, annual bonus and variable LTIP weight heavily to segment EPS (75% within SEAIP for 2024), sharpening accountability for pricing, mix, cost and share capture under Walma’s stewardship .
• Near‑term execution risk: Q1 2025 system conversion issues in Flooring NA are expected to reduce operating income by $25–$30M; remediation is underway, and management believes the extraordinary cost impact is limited to Q1—monitor customer service/retention and order/invoice normalization in 1H25 .
• Ownership/retention: Executive stock ownership guidelines (2x salary for segment leaders) with required post‑vest retention (50% net shares) and a mandatory clawback enhance alignment and reduce headline risk; no Walma‑specific pledging/hedging concerns disclosed to date .
• Governance backdrop: Say‑on‑pay support was >89% in 2024, and compensation is targeted around the 50th percentile of a home‑/building‑products industrial peer set, suggesting limited pay inflation risk ex‑performance .
• Watch items: Await Walma’s Section 16 filings for initial holdings/vesting calendars and any selling activity; track segment EPS, price/mix and restructuring savings flow‑through in Flooring NA; confirm no pledging and continued compliance with ownership policy .

Note: Walma’s specific 2025 compensation grant values and current beneficial ownership were not disclosed in the 2025 proxy; the structure, metrics and 2024 outcomes above reflect the role he now holds and provide a forward framework for evaluating his incentives and execution. All data points are sourced from Mohawk’s DEF 14A, 10‑K and 8‑K filings cited herein.