Frederic A. Escherich
About Frederic A. Escherich
Independent Class III Director of Adams Natural Resources Fund (PEO); private investor; former Managing Director and head of M&A Research and the Financial Advisory Department at J.P. Morgan & Co. Inc. Age 72; director since 2006, current term expires at the 2027 annual meeting. Designated by the Board as an “audit committee financial expert.” Also serves on the board of Adams Diversified Equity Fund (ADX), PEO’s non-controlled affiliate in the Adams Funds complex .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| J.P. Morgan & Co. Inc. | Managing Director; Head of M&A Research and Financial Advisory Department | 25 years; retired in 2002 | Led policies and procedures on valuation, transaction assessments, and analytical techniques (M&A/valuation expertise) |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Adams Diversified Equity Fund, Inc. (ADX) | Director | Same as PEO board tenure | ADX is a non-controlled affiliate in the Adams Funds complex |
Board Governance
- Independence and role: Independent director; Audit Committee Financial Expert .
- Committee assignments and chair roles (2024):
- Audit Committee – Member; 4 meetings in 2024 .
- Compensation Committee – Member; 2 meetings in 2024 .
- Executive Committee – Member; 1 meeting in 2024 .
- Nominating & Governance Committee – Chair; 6 meetings in 2024 .
- Board leadership and structure: Independent Chair (Kenneth J. Dale); five of seven directors are independent .
- Attendance: Board held seven regular and two special meetings in 2024; overall director attendance was 100% across Board and assigned committees. The 2024 annual meeting was not on a Board date and no directors attended; policy expects attendance when meetings coincide with Board meetings .
- Governance practices: Executive sessions of independent directors at each regular meeting; mandatory retirement age 75; stated director term limit of 15 years .
- Note: Escherich has served since 2006, exceeding the 15-year term limit disclosed as a best practice (board policy not further explained in the proxy) .
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Independent Director Annual Retainer ($) | $65,000 | $65,000 |
| Committee Chair Fee ($) | $3,000 (for applicable chair roles) | $3,000 (Nominating & Governance Chair) |
| Board Chair Fee ($) | N/A | N/A |
| Meeting Fees ($) | None disclosed | None disclosed |
| Escherich – Aggregate Compensation from PEO ($) | $68,000 | $68,000 |
| Escherich – Total Compensation from Fund Complex ($) | $136,000 | $136,000 |
Notes:
- Non-employee directors do not participate in employee thrift or supplemental plans .
Performance Compensation
| Item | Details |
|---|---|
| Equity/Stock Awards | No current director equity program; prior 2005 Equity Incentive Compensation Plan expired in 2015; all grants vested before 2019 . |
| Deferred/RSU/DSU holdings | Footnotes indicate no deferred stock units held by Mr. Escherich (Mr. Dale holds units) . |
| Options/Performance metrics | None disclosed for directors . |
| Clawbacks/Change-in-control | Not disclosed for directors . |
Other Directorships & Interlocks
| Company | Relationship | Potential Interlock/Conflict Consideration |
|---|---|---|
| Adams Diversified Equity Fund (ADX) | Director | PEO shares certain expenses with ADX (research, accounting, office, and other costs) per policy-based allocations. In 2024, shared expenses totaled $19,514,999; ADX’s share was $15,344,993. Oversight via Board and Audit Committee; allocation based on portfolio size/relative net assets/usage . |
Expertise & Qualifications
- Capital markets/M&A: Former head of M&A research and financial advisory at J.P. Morgan; deep valuation and transaction analysis experience .
- Audit/financial expertise: Designated audit committee financial expert .
- Investment perspective: Private investor; familiarity with equity market dynamics .
Equity Ownership
| Metric | Data |
|---|---|
| Beneficial Ownership (PEO) | 15,766 shares as of 12/31/2024 . |
| Dollar Value Category | “Greater than $100,000” as of 12/31/2024 . |
| Ownership % of Outstanding | Each director owned <1.0% (26,277,312–26,284,550 shares outstanding) . |
| Pledging/Hedging | Not disclosed . |
| Director Ownership Guidelines | Non‑employee directors must own at least $100,000 by cost basis in PEO stock within 5 years of joining the Board (cost-basis metric; proxy reports market value category) . |
Insider transactions (accrual via dividend reinvestment; no open-market sales disclosed):
| Metric | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|
| Shares Acquired (A) via DRIP (Code J) | 654 | 1,060.81 | 641 | 83 |
| Price | $0 | $0 | $0 | $0 |
| Beneficial Shares at FY End | 13,981.19 | 15,042 | 15,683 | 15,766 |
| Form & Filing Date | Form 5; 02/11/2022 | Form 5; 02/08/2023 | Form 5; 01/31/2024 | Form 5; 02/11/2025 |
Notes:
- Explanations in filings attribute acquisitions to exempt dividend reinvestment; issuer trading ranges disclosed in each Form 5 .
Governance Assessment
Strengths
- Deep transaction/valuation background; designated audit committee financial expert, supporting effective oversight of valuation, audit, and risk .
- High engagement: 100% attendance across Board and committees in 2024; independent executive sessions each regular meeting .
- Broad committee involvement with leadership: Chair, Nominating & Governance; member of Audit, Compensation, Executive Committees .
- Ownership alignment signals: >$100k dollar value category and regular DRIP accumulation; director ownership guideline in place (cost-basis metric) .
Watch items / potential red flags
- Tenure vs. disclosed term limit: Board discloses a 15-year term limit, while Escherich has served since 2006; the proxy does not explain exceptions to the limit (governance clarity consideration) .
- Cross‑board interlock within fund complex: Serves on both PEO and ADX while the funds share substantial expenses; relies on policy-based allocation and Audit Committee oversight—appropriate controls disclosed, but remains a related-party oversight area for investors to monitor .
- Annual meeting attendance: No directors attended 2024 annual meeting as it did not coincide with a Board date; policy expects attendance when aligned with Board meetings (engagement optics) .
Executive sessions, independence, and risk oversight
- Independent Chair; majority‑independent board; Audit Committee oversees major financial, compliance, and operational risks with quarterly reporting to the Board .
Committee and meeting summary (2024)
| Committee | Role | 2024 Meetings |
|---|---|---|
| Audit | Member; Financial Expert | 4 |
| Compensation | Member | 2 |
| Nominating & Governance | Chair | 6 |
| Executive | Member | 1 |
| Board | Director | 7 regular; 2 special; 100% attendance overall |
Other notes
- Director compensation is 100% cash (retainer plus chair fees); no current director equity plan; non‑employee directors do not participate in employee thrift plans .
- Stock ownership policy requires non‑employee directors to build cost‑basis ownership of at least $100,000 within five years; proxy reports dollar‑value category rather than cost basis .