Thomas Kelly
Monster BeverageAbout Thomas J. Kelly
Thomas J. Kelly (age 71) is Monster Beverage’s Chief Financial Officer since January 2021, after serving in senior finance roles at Monster Energy Company since 1992; he is a Certified Public Accountant (inactive) with over 39 years in the beverage industry, previously controller at California Copackers Corporation . Company performance under the current regime: FY2024 net sales reached a record $7.49B (+4.9% YoY), gross profit margin was 54% (+0.9 pp YoY), and 5-year TSR (2020–2024) was 65.4%, which underpin NEO incentive outcomes tied to adjusted operating income and adjusted EPS . The AIA financial component for 2024 paid at 80.4% of target based on adjusted operating income of $2.1271B (vs target $2.2138B), with the individual component certified at 100% for all NEOs including Kelly .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Monster Beverage Corporation | Chief Financial Officer | Jan 2021–present | Oversight of global finance; reporting directly to Executive Committee and Board . |
| Monster Energy Company (MEC) | EVP Finance; Controller; Secretary | 1992–Jan 2021 | Built finance infrastructure through high-growth phases; supported product expansion . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| California Copackers Corporation | Controller | Pre-1992 | Manufacturing finance leadership; prepared for transition to MEC . |
Fixed Compensation
Multi-year cash pay and AIA outcomes:
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 575,000 | 610,000 | 650,000 |
| Target AIA (% of Salary) | 75% | 75% | 75% |
| Actual AIA Paid ($) | 143,750 | 800,625 | 415,838 |
| Notes | One-time recognition bonus $250,000 (paid in 2023) . | — | Salary increased in 2024 per market benchmarking . |
Performance Compensation
- Annual Incentive Award (AIA) structure: 75% financial (adjusted operating income), 25% individual performance; linear interpolation between threshold/target/maximum for financial metric .
Detailed 2024 AIA mechanics and outcome:
| Component | Weighting | Target | Actual | Payout % | Payout ($) |
|---|---|---|---|---|---|
| Adjusted Operating Income | 75% | $2.2138B | $2.1271B | 80.4% | $293,963 |
| Individual Performance | 25% | Company/goals-based | Certified at 100% | 100% | $121,875 |
| Total AIA | 100% | $487,500 (75% of $650,000) | As above | ~85% blended | $415,838 |
Long-term incentives (PSUs, RSUs, Options):
| Award Type | Grant Date | Metric/Terms | Target/Structure | Vesting |
|---|---|---|---|---|
| PSUs (2024 grant) | 3/14/2024 | 3-year cumulative adjusted diluted EPS (FY2024–FY2026) | Threshold 3,000; Target 6,000; Max 12,000 shares | Cliff after measurement; linear 0–200% |
| RSUs (2024 grant) | 3/14/2024 | Time-based | 3,000 units | 3 equal annual installments (Mar 14, 2025/26/27) |
| Stock Options (2024 grant) | 3/14/2024 | Time-based | 9,000 @ $60.30 strike | 3 equal annual installments (Mar 14, 2025/26/27) |
Completed PSU cycle (2022 PSU awards):
| Performance Period | Threshold EPS | Target EPS | Max EPS | Actual EPS | Payout % | Shares Delivered to Kelly |
|---|---|---|---|---|---|---|
| 2022–2024 | $4.328 | $4.556 | $4.784 | $4.510 | 90% | 10,800 |
2024 realized equity activity:
| Activity | Quantity | Value |
|---|---|---|
| Options exercised | 71,748 shares | $1,288,767 |
| Stock vested (RSUs/PSUs) | 11,402 shares | $687,092 |
Equity Ownership & Alignment
Total beneficial ownership and structure:
| Item | Detail |
|---|---|
| Beneficial ownership (as of April 11, 2025) | 96,639 shares (<1% of class) |
| Direct shares | 72,273 |
| Options currently exercisable (breakdown) | 5,782 @ $29.37 (2018) ; 2,248 @ $44.47 (2021) ; 6,668 @ $36.62 (2022) ; 3,334 @ $50.82 (2023) ; 3,334 @ $50.82 (2023) ; 3,000 @ $60.30 (2024) |
| Ownership as % of shares outstanding | ~0.01% (96,639 / 975,212,504; inputs: 96,639 , 975,212,504 ) |
| Pledging | None; company anti-pledging policy with limited exceptions (only Sacks and Schlosberg have pledged small amounts) |
| Hedging | Prohibited under Insider Trading Policy |
| Stock ownership guidelines | CFO must hold stock ≥6× base salary; unvested time-based RSUs count; options and performance-based unearned awards do not |
| Compliance | All NEOs, including Kelly, were compliant in 2024 |
Outstanding equity and vesting cadence (as of 12/31/2024):
| Instrument | Status | Quantity | Strike | Expiration | Vesting |
|---|---|---|---|---|---|
| Options (2018) | Exercisable | 5,782 | $29.37 | 03/14/2028 | Vested |
| Options (2021) | Exercisable | 2,248 | $44.47 | 03/12/2031 | Vested |
| Options (2022) | Unexercisable | 6,668 | $36.62 | 03/14/2032 | 3-year installments |
| Options (2023, two grants) | Unexercisable | 6,668 + 6,668 | $50.82 | 03/14/2033 | 3-year installments |
| Options (2024) | Unexercisable | 9,000 | $60.30 | 03/14/2034 | 3 equal annual installments |
| RSUs (2022) | Unvested | 2,000 | — | — | 3-year installments |
| RSUs (2023) | Unvested | 2,268 | — | — | 3-year installments |
| RSUs (2024) | Unvested | 3,000 | — | — | 3-year installments |
| PSUs (2023 awards) | Unearned (target basis shown) | 6,800 | — | — | 2023–2025 performance |
| PSUs (2024 awards) | Unearned (target basis shown) | 6,000 | — | — | 2024–2026 performance |
Upcoming scheduled vesting that may create selling pressure windows:
- March 14, 2025/26/27: 2024 options (3,000 per tranche) and RSUs (1,000 per tranche) if service continues .
- 2024 PSUs cliff decision after FY2026 based on cumulative adjusted diluted EPS .
Employment Terms
Key terms and potential payments:
| Scenario | Cash Severance | Benefits | Equity Treatment |
|---|---|---|---|
| Termination for cause or voluntary resignation | Accrued vacation; 1 month benefits for self/dependent | Limited (1 month) | Forfeiture of unvested PSUs (unless termination on/after vest date) |
| Termination without cause (non-CoC) | Accrued vacation; 1 month benefits | Limited (1 month) | Unvested PSUs forfeited (unless on/after a vest date) |
| Change-in-control (CIC) followed by qualifying termination within 24 months | Tiered severance per a 12/7/1999 amendment: 6 months $325,000; 5 months $270,833; 4 months $216,667; 3 months $162,500 depending on timing within 24 months | Not specified beyond general practice | Double-trigger acceleration: PSUs convert to RSUs at target (if CIC in year 1) or based on actual performance-to-date (if CIC in years 2–3), then RSUs/options fully vest upon qualifying termination within 24 months |
Policies:
- Anti-hedging and anti-pledging (with limited pledging exceptions not applicable to Kelly) .
- Clawback policy adopted Dec 1, 2023 covering Section 16 officers (including CFO) for restatements; supplements plan-level clawbacks .
Compensation Peer Group and Governance
- Compensation set using F.W. Cook benchmarking; for senior executives (including Kelly) 2024 increases reflected market positioning with near-median aggregate LTI (options, RSUs, PSUs) and comparable cash compensation to peers .
- 2024 “Say-on-Pay” approval was 93.9% of votes cast; Compensation Committee made no program changes in direct response .
Investment Implications
- Pay-for-performance linkage: Kelly’s annual incentives are tied primarily to adjusted operating income (80.4% payout for 2024) and multi-year PSUs tied to adjusted diluted EPS, reinforcing operating discipline and long-term earnings quality .
- Retention risk appears moderate: employment is at will with modest CIC cash severance; however, substantial unvested equity across RSUs/options/PSUs and strict ownership/retention guidelines indicate strong alignment and retention incentives .
- Trading signals: predictable vesting dates (Mar 14 annually) and PSU cliff outcomes (post-FY2026) may create episodic liquidity windows; anti-hedging/pledging limits leverage-related selling pressure; 2024 option exercise activity ($1.29M realized) signals periodic monetization but not necessarily disposals of common shares .
- Governance and risk controls: robust clawback and insider trading policies, no tax gross-ups, and double-trigger CIC equity treatment reduce shareholder-unfriendly risks; no related-party transactions disclosed for Kelly .