Carroll L. Dewing
About Carroll L. Dewing
Senior Vice President and Chief Operating Officer of NACCO Industries (NEO for 2024) . NACCO’s pay-for-performance framework ties a majority of NEO compensation to operating performance and long-term value creation; in 2024, over 50% of other NEOs’ target compensation (non-PEO) was performance-based . Company performance context: 2024 net income was $33.741 million and the fixed $100 TSR measure stood at $88.40 as of year-end 2024 under the SEC pay-versus-performance disclosure . Short- and long-term incentive metrics emphasize consolidated operating profit, return on total capital employed (ROTCE), safety/environmental outcomes, and strategic growth initiatives .
Fixed Compensation
| Item | 2024 Details |
|---|---|
| Base Salary ($) | $410,209 (102% of midpoint) |
| Cash in Lieu of Perquisites ($) | $16,000 |
| Short-Term Incentive Target (% of midpoint) | 45% |
| Short-Term Incentive Payout ($) | $243,849 (135.1% of target) |
| Perquisites (non-cash) | $2,069 (airline club memberships, spousal travel) |
Performance Compensation
2024 Short-Term Incentive Plan (cash; capped at 150%)
| Metric | Weight | Target | Result | Achievement | Payout Contribution |
|---|---|---|---|---|---|
| Consolidated Operating Profit | 30% | $23,057,630 | $27,760,164 | 110.2% | 33.1% |
| Project Focus List (strategic) | 20% | — | — | 106.7% | 21.3% |
| MLMC Performance Factor | 5% | — | — | 110.0% | 5.5% |
| Special Project Award | 15% | — | — | 313.4% | 47.0% |
| Safety Incident Rate Index | 15% | 50% of National Avg | 61.4% | 77.2% | 11.6% |
| MSHA/OSHA Violations | 5% | 50% of National Avg | 26.7% | 123.3% | 6.2% |
| Environmental Citations | 10% | Zero per location | — | 103.8% | 10.4% |
| Final ST Payout | — | — | — | — | 135.1% |
Notes:
- Competitively sensitive targets/results not disclosed for Project Focus, MLMC, Special Project .
- Environmental achievements included industry awards that increased achievement .
2024 Long-Term Equity Plan (cash + restricted stock; capped at 200%)
| Metric | Weight | Target | Result | Achievement | Payout Contribution |
|---|---|---|---|---|---|
| Consolidated ROTCE | 20% | 3.0% | 3.5% | 103.2% | 20.6% |
| Consolidated Operating Profit | 18% | $23,057,630 | $27,760,164 | 110.2% | 19.8% |
| Project Focus List | 25% | — | — | 106.7% | 26.7% |
| MLMC Performance Factor | 7% | — | — | 110.0% | 7.7% |
| Special Project Award | 20% | — | — | 313.4% | 62.7% |
| Minerals Mgmt Investment Award | 10% | — | — | 207.9% | 20.8% |
| Final LT Payout | — | — | — | 158.3% | — |
Award mix and mechanics:
- Dewing LT target: $253,696; actual cash-denominated payout: $401,600; fair market value reported for award: $415,519 .
- Approx. 35% paid in cash, ~65% in restricted Class A shares, fully vested at grant but subject to 10-year transfer restrictions for NEOs .
Equity Ownership & Alignment
| Item | Status |
|---|---|
| Class A Common beneficially owned | 43,982 shares; less than 1% of Class A |
| Class B Common beneficially owned | 0 shares |
| 2024 LT stock issued (granted Feb 18, 2025) | 8,549 shares; value realized $274,936 (average high/low price $32.160) |
| Options outstanding | None; NACCO does not sponsor stock option plans |
| Hedging policy | Officers/directors prohibited from hedging company equity; limited trading windows apply |
| Pledging policy | Pledging not outright prohibited but requires prior approval from SVP, General Counsel & Secretary |
| Ownership guidelines | No formal minimum ownership requirement; long-term awards must be held up to 10 years, effectively building ownership over time |
Employment Terms
| Provision | Terms |
|---|---|
| Employment/Severance Agreements | None; no individual employment or severance agreements for NEOs |
| Change-in-Control (CIC) | Limited CIC benefits for all employees: immediate payment of accrued retirement benefits and a pro‑rata target award for current-year incentives; no excise tax gross‑ups |
| Estimated CIC payout (as of 12/31/2024) | $434,191 total for Dewing (equal to 2024 incentive plan targets) |
| Clawback | Policy adopted Nov 7, 2023 to recoup incentive compensation upon required financial restatement (SEC/NYSE rules) |
| Insider Trading | Policy governs transactions; limited windows; SEC‑compliant |
Deferred and pension benefits:
- Excess Plan (nonqualified defined contribution) 2024: Executive contributions $88,794; employer contributions $51,237; earnings $11,748; withdrawals $161,472; year-end balance $151,779 .
- Frozen pension benefits (Coteau Plan/SERP) present value at 12/31/2024: $469,300 (Coteau) and $31,408 (SERP); 25.92 years credited service; unreduced pension available post-termination .
Compensation Structure Analysis
- Cash vs equity mix: 2024 target total comp for Dewing emphasized fixed pay (salary/perqs ~49%) with meaningful at‑risk pay (ST 21%, LT 30%); overall target $851,291 . Awards are immediately vested but stock is subject to a 10‑year holding period, reinforcing long-horizon alignment .
- Incentive metric design: Short-term metrics blend profitability (Operating Profit), safety, environmental compliance, and strategic execution; long-term adds ROTCE and capital allocation via minerals investments—consistent with value creation focus .
- Governance and safeguards: No stock options; hedging banned; pledging controlled; clawback in place; limited CIC economics; these features reduce misalignment risks and excessive parachute exposure .
- Shareholder feedback: Strong say‑on‑pay support—94% overall; 89% excluding founding family shares—suggests investor acceptance of pay design and outcomes .
Performance Compensation – Detailed Award Tables
| Dewing Incentives | 2024 Target | 2024 Actual |
|---|---|---|
| Short-Term Plan ($) | $180,495 | $243,849 (135.1% of target) |
| Long-Term Plan ($) | $253,696 | $401,600 cash-denominated; fair value reported $415,519 |
| LT Stock Issuance (#) | n/a | 8,549 shares; $274,936 realized value at grant |
Related Policies, Peer Benchmarking, and Committee Oversight
- Benchmarking: CHC Committee uses Korn Ferry General Industry survey (excluding retail/finance) targeting the 50th percentile for salary midpoints; no named peer group disclosed due to diversified business mix .
- CHC Committee: Independent directors; responsibilities include goal setting, performance evaluation, pay decisions, clawback policy oversight, and CD&A approval; Korn Ferry engaged as independent consultant .
- No discretionary NEO cash bonuses for 2024; CHC approved “make-whole” payments related to Excess Plan changes; Butler and Dewing were the only NEOs to receive the make‑whole payment for 2024 .
Investment Implications
- Alignment and retention: Ten‑year stock holding requirement materially reduces near‑term selling pressure and aligns Dewing with long‑term TSR/ROTCE outcomes; limited trading windows further dampen opportunistic selling .
- Quality of incentives: Heavy weighting to Operating Profit, ROTCE, and strategic project value creation (uncapped Special Project/Minerals factors within plan caps) indicates emphasis on economic value rather than stock price volatility (TSR not used) .
- Risk controls: No options and strong governance (clawback, hedging ban, controlled pledging, modest CIC terms) mitigate adverse incentive risk; high say‑on‑pay support lowers governance overhang .
- Watch items: Special Project/Minerals metrics are competitively sensitive and not fully disclosed—investors should monitor disclosure in future proxies for consistency and payout calibration; confirm any future pledging approvals as a potential red flag if they emerge .