Gregory Chemnitz
About Gregory Chemnitz
Gregory R. Chemnitz, age 67, is Materion’s Vice President, General Counsel and Secretary. He joined Materion in September 2007 and has served in the role across the past five years per the company’s executive roster . He has attained normal retirement eligibility and participates in the frozen qualified pension and SRBP programs (service credited pre-2019) . Over his tenure, Materion has delivered strong operational performance, including record adjusted EBIT of $156.1 million in 2023, net income of $95.7 million, and a five-year cumulative TSR of $170.49 versus $156.61 for the S&P 600 Materials peer cohort; adjusted EBIT was $131.0 million in 2024 as markets normalized .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Materion Corporation | Vice President, General Counsel & Secretary | 2007–present | Legal risk management, governance, compliance, insider trading policies |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Not disclosed in latest proxy/10-K | — | — | No external directorships/roles disclosed in company filings reviewed |
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $461,683 | $478,185 |
| Stock Awards ($) | $565,177 | $513,318 |
| Option/SAR Awards ($) | $128,501 | $111,365 |
| Non-Equity Incentive (MIP) ($) | $169,117 | $85,610 |
| All Other Compensation ($) | $43,799 | $42,517 |
| Total Compensation ($) | $1,407,138 | $1,230,995 |
Performance Compensation
Annual incentive design (targets)
| Item | 2023 | 2024 |
|---|---|---|
| Target bonus (% of salary) | 56% | 56% |
| Metric weights | Adjusted EBIT 70%, VAS 15%, SFCF 15% | Adjusted EBIT 70%, VAS 15%, SFCF 15% |
MIP goals, actuals, and payout
| Metric | Weight | Threshold | Target | Maximum | Actual | Payout (% of target) | Year |
|---|---|---|---|---|---|---|---|
| Adjusted EBIT ($mm) | 70% | 118.1 | 157.4 | 196.8 | 139.2 | 45.85% | 2023 |
| VAS Growth (%) | 15% | -11.5% | 3.5% | 18.5% | 1.1% | 13.20% | 2023 |
| SFCF ($mm) | 15% | 78.4 | 98.0 | 117.6 | 80.4 | 4.91% | 2023 |
| TOTAL | — | — | — | — | — | 63.96% | 2023 |
| Adjusted EBIT ($mm) | 70% | 120.3 | 160.4 | 200.5 | 131.0 | 31.43% | 2024 |
| VAS Growth (%) | 15% | — | 3.0% | 8.0% | -2.6% | 0.00% | 2024 |
| SFCF ($mm) | 15% | 82.9 | 103.6 | 124.3 | 75.5 | 0.00% | 2024 |
| TOTAL | — | — | — | — | — | 31.43% | 2024 |
Long-Term Incentives (grants and vesting)
| Grant Type | Shares (2023) | Fair Value (2023) | Shares (2024) | Fair Value (2024) | Vesting/Terms |
|---|---|---|---|---|---|
| SARs | 3,040 | $128,501 | 2,207 | $111,365 | 1/3 annually over 3 yrs; 7-year term; 2024 SARs strike $135.58; expires 3/1/2031 |
| RTSR PRSUs | 1,085 | $196,450 | 856 | $165,148 | Earned over 3 yrs vs peer TSR; 0–200% payout; vest at period end |
| ROIC PRSUs | 1,085 | $122,909 | 856 | $116,056 | Earned over 3 yrs on ROIC; 0–200% payout; vest at period end |
| Time-based RSUs | 2,170 | $245,818 | 1,712 | $232,113 | 1/3 annually over 3 yrs |
Performance history: PRSU payouts have ranged from 90% (2019–2021 grants) to 200% (2018–2020), with TSR percentile ranks from 57.8% to 81.3%, evidencing above-median long-term shareholder returns in several cycles .
Equity Ownership & Alignment
| Ownership Metric | As of Jan 31, 2024 | As of Jan 31, 2025 |
|---|---|---|
| Beneficial Shares | 37,983 | 29,793 |
| Ownership % of Class | <1% | <1% |
| SARs exercisable within 60 days | 7,646 | 7,602 |
| RSUs/PRSUs vesting within 60 days | 7,538 | 4,853 |
Outstanding awards and values (year-end):
- RSUs not vested: 6,953 shares ($904,794) at 12/29/2023; 4,553 shares ($450,201) at 12/31/2024 .
- PRSUs unearned: 4,402 shares ($572,832) at 12/29/2023; 3,902 shares ($385,830) at 12/31/2024 .
- SARs outstanding: 3,599 exercisable and 5,361 unexercisable (various strikes/expiries) at 12/31/2024 .
Alignment policies:
- Stock ownership guideline: 1× base salary for Chemnitz; all covered NEOs met guidelines as of 12/31/2024; 50% net shares retention until compliant .
- Anti-hedging and anti-pledging: executives prohibited from hedging or pledging company stock .
Employment Terms
| Provision | Non‑CIC Involuntary Termination | Change‑in‑Control (CIC) + Qualifying Termination |
|---|---|---|
| Cash severance | 12 months base salary + target annual bonus | 3× period for Chemnitz (salary+bonus based on higher of target/year-of-CIC or prior highs) |
| Benefits continuation | Medical/life insurance for 12 months | Up to 3 years (values included in scenario table) |
| Outplacement | Up to $20,000 | $20,000 |
| Equity treatment | Determined under plan; no automatic acceleration under Non‑CIC policy | Double‑trigger acceleration: equity vests if not assumed at CIC or upon subsequent qualifying termination |
| Non‑compete & non‑solicit | Generally two years; one year for Chemnitz in certain cases; confidentiality & IP assignment obligations | |
| Excise tax gross‑ups | None; payments reduced if needed to avoid 280G excise tax and increase after‑tax proceeds |
CIC scenario values (if terminated on 12/31/2024):
- Base salary/annual bonus: $1,788,214; welfare benefits: $33,013; outplacement: $20,000; pro‑rata MIP: $272,384; SARs accelerated vesting: $20,320; RSU/PRSU accelerated vesting: $836,030; total: $2,969,961 .
Clawbacks and award protections:
- NYSE/SEC‑compliant clawback policy (mandatory recoupment for restatements), plus Supplemental policy to recover pay from misconduct; equity agreements include detrimental activity forfeiture .
- Repricing of “underwater” options/SARs prohibited without shareholder approval .
Retirement & Deferred Compensation
| RDCP Activity | 2023 | 2024 |
|---|---|---|
| Executive contributions ($) | $117,849 | $97,095 |
| Company contributions ($) | $13,608 | $11,392 |
| Aggregate earnings ($) | $205,085 | $163,091 |
| Aggregate balance ($) | $1,231,334 | $1,502,912 |
Pension benefits (frozen accruals; normal retirement age 65):
- Qualified Pension Plan present value: $391,327 (12 yrs credited service); SRBP present value: $587,172 (12 yrs service); actual service at 12/31/2024 was 17 years .
Compensation Structure Notes
- Pay positioning: target total direct compensation managed within ~20% of market median; peer group updated to advanced materials/tech comparables (e.g., Advanced Energy, Hexcel, Rogers, Standex, Viavi) .
- Say‑on‑pay support: 94% approval in 2024; Committee retained pay‑for‑performance design .
- 2025 equity plan: 965,000 shares authorized (including roll‑over from prior plans) with strict share counting, director compensation limits, and no repricing; accommodates clawbacks and double‑trigger CIC definitions .
Risk Indicators & Red Flags
- Hedging/Pledging: prohibited (alignment positive) .
- Tax gross‑ups: none in severance agreements (shareholder‑friendly) .
- Section 16 filings: one late Form 4 in 2024 for Chemnitz due to administrative error (procedural, not necessarily indicative of risk) .
- Equity overhang/burn rates: prudent historical burn (~0.77% three‑year avg); overhang ~4.8% at 12/31/2024, rising to ~6.4% if 2025 plan approved and then declining over time .
Investment Implications
- Strong alignment: robust unvested RSUs/PRSUs ($836k accelerated value in CIC scenario) and SARs tie Chemnitz’s upside to stock and TSR/ROIC outcomes; mandatory ownership and retention further align interests .
- Retention: Non‑CIC severance and double‑trigger CIC protection, plus significant unvested equity, reduce near‑term departure risk; however, normal retirement eligibility and meaningful deferred comp may modestly increase medium‑term transition risk .
- Trading signals: Upcoming vesting cycles (RSUs 1/3 annually; PRSUs 2024–2026) and SAR exercises near $135.58 strike could create episodic selling pressure around anniversaries; anti‑hedging/pledging policy mitigates leveraged selling risks .
- Pay-for-performance: PRSU history shows above‑median TSR in several cycles; lower 2024 MIP payout (31.43% of target) underscores downside sensitivity to EBIT/FCF execution—constructive for shareholder alignment .