Frank Lee
PHOTRONICSAbout Frank Lee
Frank Lee (age 72) is Photronics’ Chief Executive Officer and a director since May 2022; he is not independent under NASDAQ rules and therefore does not serve on independent committees . He holds a BS in Nuclear Engineering from Tsinghua University and an MS/PhD in Materials Science from the University of Cincinnati . He joined Photronics in 2006 (President of Taiwan JV) and was appointed CEO on May 16, 2022, with an employment agreement that auto-renews and includes severance and change‑in‑control provisions .
Past Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Photronics (Taiwan JV; formerly PSMC) | President | 2006–2022 | Led JV operations before CEO promotion |
| NSMC (Ning-Po) | Chief Executive Officer | 2004–2006 | CEO prior to Photronics |
| UMC (Hsinchu, Taiwan) | Fab Director & Senior Advisor | 2001–2004 | Senior manufacturing leadership |
| Grace Semiconductor (Shanghai) | Executive Vice President | 2000–2001 | Executive role in China |
| TI–Acer JV (Taiwan) | Vice President of Operations | Not disclosed | Semiconductor JV operations leadership |
| TSMC–Acer; UMC | Leadership roles | Not disclosed | Senior positions in Taiwan |
| Fairchild Semiconductor; Intel; Soliconix | Roles (not specified) | Not disclosed | Earlier semiconductor/tech experience |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| — | — | — | No other public company directorships disclosed for Frank Lee |
Board Governance
- Independence: Not independent; independent directors are Garcia, Lewis, Liao, Tyson, and Paladino .
- Committee assignments: None disclosed for Lee; independent committees comprised solely of non‑employee directors .
- Attendance: Board met 6 times in FY2024; each director attended at least 75%; all directors attended the 2024 annual meeting .
- Lead Independent Director: Role vacated after Fiederowicz chose not to stand for re‑election; Board has not appointed a new LID .
- Executive sessions: Board regularly holds executive sessions without management .
Fixed Compensation
| Year | Base Salary ($) | Notes |
|---|---|---|
| 2024 | 750,000 | Per employment agreement; eligible for auto allowance under agreement |
| 2023 | 750,000 | |
| 2022 | 650,000 |
Employment agreement highlights:
- Term/renewal: 3‑year agreement dated Oct 31, 2019; auto‑renews unless 30‑day notice .
- Severance (no cause/good reason): 100% of base salary over 12 months .
- Change‑in‑control: 150% of base salary over 18 months; immediate vesting of options/rights .
- Non‑compete: 12 months post‑employment .
Performance Compensation
| Component | FY2024 | FY2023 | FY2022 |
|---|---|---|---|
| Cash Bonus ($) | 603,853 | 1,300,000 | 963,800 |
| Equity Grants (RS) | 120,000 shares; grant date 01/03/2024; fair value $3,572,400; vests 25% annually over 4 years | — | — |
Performance metrics tied to annual incentives:
- The Compensation Committee set quarterly objectives based on operating income and gross margin in 2024; targets are competitively sensitive and not disclosed .
- Company identifies Revenue, Gross Margin, Operating Income, and Net Income as key measures for pay-versus-performance linkage .
FY2024 actuals used in pay-versus-performance disclosures:
| Metric | FY2024 Actual |
|---|---|
| Revenue ($ Millions) | 866.9 |
| Net Income ($ Millions) | 130.7 |
Award cadence and vesting:
| Grant Date | Award Type | Shares | Fair Value ($) | Vesting |
|---|---|---|---|---|
| 01/03/2024 | Restricted Stock | 120,000 | 3,572,400 | 25% per year over 4 years |
| 01/03/2025 | Restricted Stock | 80,000 | — | 25% per year over 4 years |
Pay structure signals:
- Discretionary bonuses outside the 2011 EICP cap (65% of base) were granted for FY2024 performance; Lee’s $603,853 bonus exceeded the plan cap, awarded at committee discretion outside EICP .
- CEO pay ratio: 102:1 for FY2024 (CEO total $4,926,253 vs. median employee $48,071) .
Other Directorships & Interlocks
| Company | Role | Committee Roles | Interlock/Conflict Notes |
|---|---|---|---|
| — | — | — | No other public company boards disclosed for Lee |
Expertise & Qualifications
- Technical/industry: Decades in semiconductor operations and manufacturing across leading firms and Taiwan JVs .
- Education: BS Nuclear Engineering (Tsinghua); MS/PhD Materials Science (University of Cincinnati) .
- Board qualifications: Operational leadership and global manufacturing experience; not designated as an audit committee financial expert .
Equity Ownership
| Holder | Shares Beneficially Owned | % of Shares Outstanding | Options Exercisable (as of 02/07/2025) | Notes |
|---|---|---|---|---|
| Frank Lee | 562,100 | 1.0% | 83,000 | Includes options exercisable within 60 days |
Outstanding equity at FY2024 year‑end (Lee):
| Instrument | Grant Date | Unvested Shares (#) | Market Value ($) |
|---|---|---|---|
| RS | 01/02/2021 | 8,750 | 199,500 |
| RS | 01/03/2022 | 20,000 | 456,000 |
| RS | 05/18/2022 | 17,500 | 206,550 |
| RS | 01/03/2023 | 90,000 | 2,052,000 |
| RS | 01/03/2024 | 120,000 | 2,736,000 |
Option awards (historical; exercisable):
| Grant Date | Exercisable Options (#) | Exercise Price ($) | Expiration |
|---|---|---|---|
| 12/19/2014 | 30,000 | 8.23 | 12/19/2024 |
| 01/04/2016 | 33,000 | 12.13 | 01/04/2026 |
| 01/03/2017 | 20,000 | 11.35 | 01/03/2027 |
| 03/07/2017 | 10,000 | 10.75 | 03/07/2027 |
| 01/02/2018 | 20,000 | 8.60 | 01/02/2028 |
Insider activity (FY2024):
| Activity | Shares | Value Realized ($) |
|---|---|---|
| Option exercises | 30,000 | 377,580 |
| RS vesting | 66,250 | 1,971,913 |
Ownership alignment and policies:
- Stock ownership guidelines: CEO must hold 2x base salary; all directors/NEOs were in compliance as of Oct 31, 2024 .
- Hedging policy: Expanded in 2025 to prohibit hedging without prior approval; applies to directors and employees .
- Clawback: Adopted in 2023 per SEC/stock exchange rules; no recoveries in FY2024 .
Governance Assessment
- Effectiveness and engagement: Board and committee cadence robust (Board: 6 meetings; Audit: 18), with director attendance ≥75% and regular executive sessions—positive for oversight .
- Independence and committees: Lee is CEO and not independent; he appropriately does not sit on independent committees, and CEO compensation decisions occur outside his presence—appropriate governance practice .
- Compensation structure: Significant equity grants and at‑risk pay align incentives; however, discretionary bonus awards exceeding the EICP cap were granted outside the plan—potential pay governance red flag and precedent risk .
- Related‑party exposure (RED FLAG): Lee is related to an individual in authority at a top customer; PLAB recorded $127.0 million revenue and $38.8 million receivables from this customer in FY2024—requires continued Audit Committee scrutiny for arm’s‑length terms .
- Shareholder input: Say‑on‑pay support at 83.95% (2024 meeting for 2023 pay) indicates adequate investor tolerance, but the bonus policy deviation should be monitored in future votes .
- Leadership structure: Lead Independent Director role currently vacant after departure—Board intent to reassess is noted; near‑term risk of weaker independent leadership unless responsibilities are clearly redistributed .
Net takeaways: Strong operational background and meaningful stock ownership support alignment; governance risks center on related‑party transactions and compensation exceptions. Ongoing, transparent Audit Committee oversight and adherence to plan limits would bolster investor confidence .