Joel Quadracci
About Joel Quadracci
J. Joel Quadracci is Chairman, President and Chief Executive Officer of Quad/Graphics, Inc. (Quad). He joined Quad in 1991, became President in January 2005, CEO in July 2006, and Chairman in January 2010 . He holds a B.A. in Philosophy from Skidmore College (1991) and is 56 years old . Pay-versus-performance disclosures show cumulative TSR from a $100 base of $102.00 (2022), $135.50 (2023), and $179.25 (2024), with net income (loss) of $9.3m (2022), $(55.4)m (2023), and $(50.9)m (2024) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Quad/Graphics, Inc. | Chairman, President & CEO | Chairman since Jan 2010; President & CEO since Jul 2006; President since Jan 2005 | Unified leadership and industry expertise cited as rationale for combined Chair/CEO structure in a controlled company . |
| Quad/Graphics, Inc. | Sales Manager; Regional Sales Strategy Director; VP Print Sales; SVP Sales & Administration; President & COO | Joined 1991; roles prior to 2005 | Commercial printing and marketing services leadership progression underpinning CEO credentials . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Plexus Corp. | Director | NA | Public company directorship . |
| Pixability, Inc. | Director | NA | Private company board role . |
| Road America, Inc. | Director | NA | Private company board role . |
| National Association of Manufacturers | Director | NA | Industry association leadership . |
| Metropolitan Milwaukee Association of Commerce | Director | NA | Regional business leadership . |
| Milwaukee Art Museum | Trustee | NA | Non-profit governance . |
| Smithsonian National Postal Museum | Advisory Council | NA | Cultural institution advisory role . |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (% of base) | Actual Annual Incentive Paid ($) | Notes |
|---|---|---|---|---|
| 2023 | 1,087,371 | 120% (in 2023; raised to 125% for 2024) | 5,242,345 (includes AIP and LTI new-sales cash earned for 2023 performance paid in 2024) | |
| 2024 | 1,130,000 | 125% (raised from 120%) | 1,412,500 (AIP payout at target on FCF gate and Adj. EBITDA target) |
- Perquisites (2024): corporate aircraft personal use $138,831; club dues $15,857; security services $84,379; tax preparation $7,500; executive medical $13,849; 401(k) match $8,694; SERP contribution $55,377 .
- As an employee-director, Quadracci receives no separate director fees .
Performance Compensation
Annual Incentive Plan (AIP) – 2024 design and results
| Metric | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|
| Adjusted EBITDA | $185m | $220–235m | ≥$250m | $224m | Target payout approved |
| Free Cash Flow (gate) | ≥$40m | NA | NA | $56m | Gate satisfied |
Notes: AIP measured on Adjusted EBITDA with an FCF gating requirement; 2024 AIP paid at target, including Quadracci’s AIP payment of $1,412,500 .
Long-Term Incentive (LTI) – 2024 program and targets
- Mix: 67% performance-based cash; 33% restricted stock/RSUs (cliff vest after 38 months; March 1, 2027) .
- 2024 LTI target values (Joel Quadracci): total $4,800,000; cash-based target $3,216,000; equity grant-date target $1,584,000 .
- Actual 2024 grant: 300,000 restricted shares/RSUs; grant date fair value $1,626,000 .
- Performance metrics for performance cash:
- 50% based on “new sales” with three annual periods (2024–2026); 2024 new sales thresholds/target/max: $207m/$243m/$280m; actual $257m; payout factor 154.7% for the 2024 tranche .
- 50% based on three-year free cash flow (2024–2026) .
Discretionary adjustment (legacy cycle)
- For the 2022–2024 LTI cycle, the free cash flow portion failed to meet threshold; the committee nonetheless approved a payout at 100% target for NEOs and the Board approved the same for Quadracci, citing adverse macro factors and management achievements (deleveraging, asset sales, refinancing, ratings) .
Performance Compensation details table
| Incentive | Metric | Weighting | Target | Actual/Status | Payout/Conversion |
|---|---|---|---|---|---|
| AIP 2024 | Adjusted EBITDA (with FCF gate) | NA | $220–235m | $224m; FCF $56m (gate met) | Target payout (Joel AIP $1,412,500) |
| LTI 2024–2026 | New sales (annual 2024) | 50% of cash comp (1/3 per year) | $243m | $257m | 154.7% of target (annual tranche) |
| LTI 2024–2026 | Free cash flow (3-year) | 50% of cash comp | NA | In flight | Earn-out in 2027 based on 3-year FCF |
| LTI 2022–2024 (legacy) | Free cash flow (3-year) | 50% of cash comp | NA | Below threshold | Discretionary 100% payout |
Equity Ownership & Alignment
| Category | Detail |
|---|---|
| Beneficial ownership (Class A) | 2,179,381 shares; 5.87% of Class A . |
| Beneficial ownership (Class B) | 358,789 shares; 2.71% of Class B; includes 129,425 Class B in trusts where he is trustee/co-trustee and/or potential beneficiary . |
| Unvested equity at 12/31/2024 | 1,046,199 shares unvested; market value $7,292,007 at $6.97 per share (12/31/2024 close) . |
| Vesting schedule (as of 12/31/2024) | 370,589 vest on 03/01/2025; 375,610 vest on 03/01/2026; 300,000 vest on 03/01/2027 . |
| 2024 equity grant | 300,000 restricted shares/RSUs; cliff-vest 03/01/2027; grant-date fair value $1,626,000 . |
| 2025 contingent grant (if plan amended) | 205,224 restricted shares approved by committee subject to shareholder approval of share increase . |
| Stock ownership guidelines | CEO 5x base salary; counts RS/RSUs, DSUs, and outright shares . |
| Hedging/pledging | Hedging prohibited; pledging requires prior approval . |
| Insider trading policy | Policy governs trades by directors/officers; company will not trade when in possession of MNPI . |
| Control structure | Quad Voting Trust holds 92.59% of Class B (super-voting) shares; trustees are J. Joel Quadracci, Kathryn Q. Flores, and Elizabeth Quadracci Harned (majority action); trust is perpetual absent specified termination events . |
Vesting schedule detail (indicative dollar amounts at $6.97 close on 12/31/2024):
- 03/01/2025: 370,589 shares ≈ $2.59m (370,589 × $6.97) .
- 03/01/2026: 375,610 shares ≈ $2.62m (375,610 × $6.97) .
- 03/01/2027: 300,000 shares ≈ $2.09m (300,000 × $6.97) .
Note: Company policy prohibits hedging and restricts pledging; no specific pledges by Quadracci are disclosed .
Employment Terms
| Topic | Terms |
|---|---|
| Employment agreement | Provides severance protections; 24-month non-competition, non-solicit, non-disclosure, non-disparagement covenants . |
| Severance (no change-in-control) | 2x base salary + target annual bonus; pro-rated current-year bonus based on actual performance; continued welfare benefits at employee rate; outplacement (assumed $50k) . |
| Severance (change-in-control + qualifying termination) | 3x base salary + target annual bonus; pro-rated current-year bonus at target; lump-sum welfare equivalent; accelerated vesting per plan; outplacement (assumed $50k) . |
| Equity treatment on change-in-control | Single-trigger acceleration: all unvested options/restricted stock vest; performance-based cash and performance shares earn at target; amounts earned but unpaid are paid at change-in-control . |
| Excise tax (280G/4999) | Company-wide plan applies “best-net” (cut-back) with no gross-up; Quadracci’s employment agreement provides excise tax gross-up . |
| Clawback | All awards subject to company’s recoupment/clawback and stock ownership policies, and applicable legal requirements . |
| Illustrative CoC payout (as of 12/31/2024) | Total estimated package $24,702,429 (severance, pro-rated bonus, performance cash at target, RS vest, welfare, outplacement; no gross-up shown in table) . |
Compensation Structure Analysis
- Shift toward performance cash and time-based RS/RSUs persists: 2024 LTI kept 67% performance cash / 33% RS/RSU with 38‑month cliff vesting, balancing retention with performance leverage .
- AIP anchored to Adj. EBITDA with an FCF gate aligns to deleveraging and cash generation priorities; 2024 paid at target on $224m Adj. EBITDA and $56m FCF .
- Discretionary override: Committee/Board paid legacy 2022–2024 FCF LTI tranche at 100% despite miss, citing external rates and balance sheet actions—introduces discretion risk vs. formulaic pay .
- No option repricing allowed; hedging prohibited; pledging limited—better shareholder alignment practices .
Compensation & Director Governance Context
| Item | Detail |
|---|---|
| Comp committee | Members: Jay O. Rothman (Chair), Douglas P. Buth, Beth‑Ann Eason, John C. Fowler; FW Cook is independent consultant; subcommittee handles Section 16(b) matters . |
| Peer group (benchmarking) | 20-company group across print/commercial services and marketing platforms (e.g., Interpublic, Omnicom, Stagwell, Conduent, Deluxe, Pitney Bowes, Cimpress) . |
| Say-on-pay | 97% support in 2023; triennial cadence; next expected 2026 . |
Board Governance (including dual-role implications)
- Board structure and independence: Quad is a NYSE “controlled company” due to the Quad Voting Trust; exempt from certain NYSE requirements; a majority of directors are independent, but Quadracci, Dr. Kathryn Q. Flores, John C. Fowler, and Christopher B. Harned are not independent .
- CEO/Chairman dual role: The Board combines the roles, citing unified leadership and Quadracci’s company/industry knowledge; no Lead Independent Director, with the Board indicating the controlled structure mitigates need .
- Committees: Quadracci is not listed as serving on the Audit, Compensation, or Finance Committees; those are fully or majority independent (Audit fully independent) .
- Meetings and attendance: Board held seven meetings in 2024; each director attended at least 75% of Board and committee meetings; all directors attended the 2024 Annual Meeting .
- Related parties: Family ties include sister Kathryn Q. Flores (director; CEO of QuadMed with $849,110 2024 compensation) and brother‑in‑law Christopher B. Harned (director) .
Director Compensation (as a director)
- Quadracci received no separate director compensation in 2024 due to employee status .
Equity and Cash Compensation Tables
2024 Summary Compensation (selected line items)
| Year | Salary ($) | Stock Awards ($) | Non-Equity Incentive Plan Compensation ($) | Bonus ($) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2023 | 1,087,371 | 1,532,489 | 5,242,345 | — | 648,281 | 8,510,486 |
| 2024 | 1,130,000 | 1,626,000 | 3,692,778 (AIP + LTI new-sales tranches) | 1,407,000 (legacy LTI FCF discretionary) | 324,487 | 8,180,265 |
2024–2026 LTI Target Structure (Joel)
| Total Target LTI Value ($) | Cash-Based Target ($) | RS/RSU Target ($) |
|---|---|---|
| 4,800,000 | 3,216,000 | 1,584,000 |
2024 Equity Grant Detail (Joel)
| Grant Date | Shares Granted | Vesting | Grant-Date Fair Value ($) |
|---|---|---|---|
| 01/01/2024 | 300,000 (RS/RSUs) | Cliff on 03/01/2027 | 1,626,000 |
Outstanding Unvested Equity at 12/31/2024 (Joel)
| Unvested Shares | Market Value ($) at $6.97 | Tranche 1 | Tranche 2 | Tranche 3 |
|---|---|---|---|---|
| 1,046,199 | 7,292,007 | 370,589 vest 03/01/2025 | 375,610 vest 03/01/2026 | 300,000 vest 03/01/2027 |
Beneficial Ownership (as of Record Date)
| Class | Shares Beneficially Owned | % of Class |
|---|---|---|
| Class A | 2,179,381 | 5.87% |
| Class B | 358,789 (incl. 129,425 in certain trusts) | 2.71% |
Employment & Protection Scenarios (illustrative, as of 12/31/2024)
| Scenario | Key Elements (Joel) |
|---|---|
| Change-in-control with qualifying termination | Estimated total $24,702,429; includes severance, pro-rated target bonus, performance cash at target, accelerated equity vesting, welfare, outplacement; no excise tax “best-net” adjustment shown in table for Joel . |
| Termination without CoC (non-cause / good reason per contract) | Cash termination payment $5,085,000; pro-rated current-year bonus $1,412,500; outplacement $50,000; welfare/insurance $51,430 . |
| Death/Disability | Base salary continuation (present value) $4,863,151; performance-based cash at assumed target $8,243,278; RS vest $7,292,007 . |
Risk Indicators & Red Flags
- Controlled company with concentrated voting power via family voting trust; CEO also a trustee, and multiple family members in governance/leadership roles .
- CEO/Chair duality with no Lead Independent Director (Board cites controlled structure) .
- Single-trigger equity acceleration upon change-in-control (performance cash/PSUs at target), which can weaken retention incentives in a sale process .
- Excise tax gross-up for Quadracci under his agreement (shareholder-unfriendly feature), while company-wide plans use “best-net” cutback .
- Use of discretion to pay a missed 3-year FCF performance tranche at target (2022–2024) may dilute pay-for-performance integrity .
Say-on-Pay & Shareholder Feedback
- 2023 advisory vote: 97% support; triennial frequency; next expected in 2026; committee retained program design given strong support .
Compensation Peer Group (for benchmarking)
- 20 peers across print/commercial services and marketing, including Interpublic Group, Omnicom Group, Stagwell, Cimpress, Deluxe, Pitney Bowes, Conduent, NY Times, Ziff Davis, among others .
Investment Implications
- Alignment and retention: Significant unvested equity (1.05m shares) with scheduled vests through 2027, plus a contingent 205,224-share 2025 grant if plan amendment approved, create ongoing retention hooks but also predictable potential supply that could contribute to insider selling pressure following vest dates (subject to policy/blackouts) .
- Pay-for-performance: 2024 AIP paid at target on cash- and EBITDA-centric metrics; LTI emphasizes new sales and multi-year FCF. The 2022–2024 discretionary payout underscores committee flexibility; investors may monitor whether forward metrics (new sales/FCF) remain rigorous amid secular print pressures .
- Governance risk/discount: Controlled-company status, CEO/Chair duality without a Lead Independent Director, related-party dynamics, and single-trigger equity acceleration could warrant a governance discount versus peers despite strong say-on-pay results .
- Change-in-control math: Robust CoC package (estimated ~$24.7m as of 12/31/24) and single-trigger equity may influence negotiating dynamics in strategic alternatives; excise tax gross-up is an outlier vs. many modern practices .