John Schmitz
About John Schmitz
John D. Schmitz (age 64) is Chairman, President, and Chief Executive Officer of Select Water Solutions (WTTR). He has served as Chairman since January 2020 and as President and CEO since January 2021, after previously serving as Executive Chairman (2017–2019) and, prior to the Rockwater merger, CEO/Chairman of SES Holdings since founding the business in 2007 . Under his leadership, WTTR delivered strong 2024 results: total shareholder returns of 79% for 2024, ~$1.5B revenue, ~$235M operating cash flow, and a 26% y/y revenue increase in Water Infrastructure with 62% y/y gross profit growth for that segment .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Select Water Solutions / SES Holdings | Executive Chairman (Select: 2017–2019); CEO/Chairman (SES Holdings since 2007; Select CEO/Chairman since 2021/2020) | 2007–present | Founder and principal architect of growth; led merger with Rockwater; scaled water infrastructure, services, and chemicals platform . |
| Complete Production Services (NYSE: CPX) | North Texas Division Manager | Through sale in Feb 2012 | Operated regional wellsite services until CPX sale to Superior Energy Services (NYSE: SPN) . |
| Brammer Supply / BSI Holdings | Founder and President | 1983–2003 | Built integrated wellsite service provider to 16+ locations; later recapitalized by SCF Partners and rolled into Complete . |
| Allied Production Solutions (merged into Forum Energy Technologies) | Founder/recapitalization lead | Through Aug 2010 merger | Created surface tank equipment manufacturer; contributed to Forum’s platform via 2010 merger . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Endurance Lift Holdings (includes Bell Supply, Endurance Lift Solutions) | Chief Executive Officer | Since Jan 2020 | Operates artificial lift and O&G parts distribution businesses . |
| Silver Creek Exploration III, LLC | Chairman of the Board | Current | Also indicates interlock: WTTR Lead Director Richard Burnett is President & CEO of Silver Creek Exploration III . |
| Multiple private O&G companies | Director | Ongoing | Portfolio oversight via B-29 family office entities . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 600,000 | 792,308 | 800,000 |
| Target Bonus (% of salary) | — | — | 115% |
| STI – Individual “Bonus” ($) | 258,750 | 230,000 | 184,000 |
| STI – Company metric payout (Non‑Equity Incentive Plan Comp) ($) | 675,726 | 566,628 | 691,196 |
| Total STI actually paid ($) | 934,476 | 796,628 | 875,196 |
Notes: 2024 total STI payout equaled 95.1% of target for Mr. Schmitz, comprising company-wide metrics plus individual strategic goals .
Performance Compensation
2024 Annual Cash Incentive (STI) Design and Results
| Metric | Weight | Threshold | Target | Maximum | 2024 Actual | Payout vs. Target | Weighted Contribution |
|---|---|---|---|---|---|---|---|
| Adjusted EBITDA | 40% | $191.5mm | $278.7mm | $334.4mm | $258.4mm | 87.8% | 35.1% |
| Free Cash Flow (FCF) | 30% | $50.6mm | $101.1mm | $151.7mm | $98.9mm (adj. +$21.3mm) | 97.8% | 29.3% |
| Safety (TRIR/LTIR) | 5% | — / — | 0.68 / 0.24 | — / 0.20 | 0.54 / 0.25 | 100% | 5.0% |
| Environmental (Recycled water volumes) | 5% | 116.5 mmbbl | 233.0 mmbbl | 279.6 mmbbl | 264.3 mmbbl | 113.4% | 5.7% |
| Strategic Individual Goals | 20% | — | — | — | Committee‑assessed | 20% | 20.0% |
| Total | 100% | 95.1% |
Definitions: Adjusted EBITDA and FCF are defined per STI Plan; safety includes TRIR/LTIR; environmental measures recycled volumes . Committee rationale for 20% individual payout included Water Infrastructure growth (+26% rev, +62% gross profit), volume execution and long-term contract wins .
2024 Long-Term Incentives (LTI) – Grant Mix and Values (CEO)
| Instrument | Performance metric | Weight | Grant date | Target Qty (#) | Grant-date Fair Value ($) |
|---|---|---|---|---|---|
| Restricted Shares (3-yr ratable vest) | Time-based | 50% | 2/24/2024 | 185,664 | 1,633,843 |
| PSUs – Relative ROA (3-yr) | Relative ROA vs peer set | 25% | 2/24/2024 | 92,832 | 600,623 |
| PSUs – TSR (3-yr) | Absolute TSR | 25% | 2/24/2024 | 92,832 | 980,306 |
| Total 2024 LTI (planned value) | — | 100% | — | — | 3,160,000 |
PSU mechanics: Relative ROA PSUs vest 0–200% based on peer rank, subject to a negative TSR cap; TSR PSUs vest 0–200% based on annualized TSR with thresholds at 0%/10%/≥30% for 50%/100%/200% payout . 2022 PSU outcomes: Relative ROA PSUs vested at 132% (rank 5/13; TSR 7.33%); FCF PSUs vested at 62% over 2022–2024 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership (Class A) | 4,801,408 shares (4.6% of Class A; 4.0% combined voting power) . |
| Options held (Exercisable) | 216,853 @ $30.75; 195,749 @ $25.63; 172,244 @ $20.50; all expiring 1/19/2028 . |
| Unvested restricted shares (12/31/24) | 380,694 shares; market value $5,040,389 at $13.24/share . |
| Unvested PSUs (max reporting basis) | 649,854 PSUs; “market/payout value” $8,604,060 at $13.24/share (actual earnout depends on future performance) . |
| Near-term vesting schedule (RSAs) | 59,987 vest 2/24/2025; 135,043 vest half on 2/24/2025 & 2/24/2026; 185,664 vest one‑third on 2/24/2025, 2/24/2026, 2/24/2027 . |
| Ownership guidelines | CEO must hold 5x base salary; all executives/directors have satisfied or are on track within 5 years . |
| Hedging/pledging | Hedging and short sales prohibited; pledging requires Audit Committee pre‑approval; margin purchases prohibited . |
| Director pay for Schmitz | As CEO, receives no compensation for Board service (non‑employee director program does not apply) . |
Commentary on selling pressure: Upcoming RSA vesting dates (Feb 24, 2025/2026/2027), 2023–2026 PSU performance horizons, and 2028 option expiries represent potential trading windows to monitor; the company’s Insider Trading Policy restricts hedging and regulates pledging, mitigating some alignment risks .
Employment Terms
| Provision | Key terms |
|---|---|
| Employment agreement | Entered May 2023; initial term through Dec 31, 2025; auto-renews annually unless 60 days’ notice . |
| Base/bonus eligibility | $800,000 base; target bonus 115% of salary; eligible for annual equity . |
| Non-compete / non-solicit | Restrictive covenants generally during employment and 1 year post-termination . |
| Severance (no CIC) | If terminated without Cause, for Good Reason, non-renewal, death or Disability: 2x (base + target bonus) paid over 24 months; pro‑rated current-year bonus; prior-year earned bonus; up to 18 months COBRA reimbursement . |
| Severance (CIC protection) | If termination occurs within 60 days prior to or within 24 months after CIC: 3x (base + target bonus) paid over 36 months; pro‑rated current-year bonus; prior-year earned bonus; COBRA reimbursements . |
| Equity on termination | 2024 PSUs: pro‑rata service credit on termination without Cause/for Good Reason; death/Disability or qualifying CIC‑related termination gets full service credit; vesting subject to actual performance through period . RSAs: full vest on death/Disability; pro‑rated on Retirement; full vest on qualified termination within 2 years post‑CIC; certain 2022–2023 RSAs vest if terminated without Cause after 1st anniversary . |
| Clawback | NYSE 10D-1 compliant clawback policy for restatements; recovers excess incentive-based comp over prior 3 fiscal years . |
Definitions of Cause/Good Reason/Change in Control/Disability/Retirement are detailed in the agreement and plan documents .
Board Governance and Director Service
- Dual role: Schmitz is Chairman, President, and CEO since Jan 2021 (Chair since Jan 2020). To mitigate dual-role risks, the Board appointed a Lead Independent Director (Richard A. Burnett) in March 2023 with defined responsibilities (agenda setting, executive sessions, shareholder liaison) .
- Independence: All directors except Mr. Schmitz are independent under NYSE standards; committees (Audit, Compensation, NG&S) comprised solely of independent directors .
- Committee memberships (Schmitz): none .
- Attendance: In 2024, the Board met 7x; Schmitz and all directors attended at least 75% of applicable meetings; all directors attended the 2024 annual meeting .
- Executive sessions: Independent directors meet in regular executive sessions led by the Lead Director .
Director Compensation (for context; Schmitz excluded)
- Non‑employee directors received cash retainers (base $70k; committee chair supplements; $20k Lead Director; $100k Chairman) and ~$150k in RSAs (16,447 shares granted 5/7/2024; 1‑yr vest) .
- Schmitz receives no board compensation as CEO .
Related Party Transactions (2024)
| Counterparty (relation) | Nature | Amount ($) |
|---|---|---|
| Axis Energy Services (owned by Schmitz) | Property rental fees; sales | 1,925,611; 676,095 |
| B‑29 Ups & Downs, LLC (owned by B‑29 Family Holdings, controlled by Schmitz) | Aviation services | 1,324,575 |
| Bell Supply Company (owned by Endurance Lift Holdings, controlled by Schmitz) | Parts/supplies purchased | 511,595 |
| Merit Appraisal & Tax Consulting (controlled/partially owned by B‑29 Family Holdings) | Appraisal and tax consulting | 956,307 |
| MyWorkDoc Technologies (owned by B‑29 Family Holdings) | Services | 465,810 |
| Sunray Capital, LP (B‑29 holding company subsidiary) | TRA payments | 136,734 |
| United Surface and Minerals (owned by Schmitz and Ortowski) | Property rental fees | 241,386 |
| Aquacore Rental (indirectly owned by Cody and Cole Ortowski) | Equipment rentals; sales | 15,165,325; 8,454 |
| Orteq Energy Technologies (indirectly owned by Cody and Cole Ortowski) | Equipment purchased | 4,076,362 |
The proxy also discloses TRA program details and additional TRA payments (e.g., to Crestview affiliates and B‑29 Investments) .
Compensation committee interlock note: Schmitz sits on Silver Creek’s board where WTTR’s Lead Director Burnett is CEO; Schmitz also leads Endurance Lift Holdings; the company discloses these relationships in its interlocks section .
Compensation Program Architecture and Peer Benchmarking
- Mix and governance: High “at‑risk” pay (84% CEO; 73% average for other NEOs); robust ownership guidelines; anti‑hedging policy; no tax gross‑ups; clawback policy; no option repricing without shareholder approval .
- Peer group (2024): Aris Water Solutions; Archrock; Cactus; Forum Energy Tech; Helmerich & Payne; KLX Energy Services; Liberty Energy; NexTier Oilfield Solutions (later removed post‑acquisition); Nine Energy; NPK International (f/k/a Newpark); Oil States; Patterson‑UTI; ProPetro; RPC; TETRA; U.S. Silica (later removed post‑acquisition) .
- Market positioning: WTTR targets mid‑market ranges; independent consultant transition from Pearl Meyer to Meridian in 2024; continued annual risk assessment of pay programs .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑pay approval: ~98% support at the 2024 annual meeting; WTTR shifted to annual say‑on‑pay frequency going forward .
Investment Implications
- Pay-for-performance alignment: 2024 STI metrics (EBITDA, FCF, safety, recycling volumes) and LTI performance metrics (Relative ROA and TSR) directly tie realized pay to cash generation, capital efficiency, and shareholder returns; 2024 STI paid at 95.1% of target reflecting near‑target EBITDA/FCF and above‑target environmental performance .
- Retention and selling pressure: Meaningful unvested RSAs through 2027 and multi‑year PSUs (2026 horizon) support retention; monitor potential Form 4 activity around February vesting dates and PSU outcomes; options expiries in 2028 could influence timing of exercises/sales .
- Alignment and governance risk: Strong ownership (4.6% Class A; 4.0% combined voting) and stringent insider policies are positives; dual CEO/Chairman role is offset by an empowered Lead Independent Director and independent committees, but remains a governance consideration .
- Related-party exposure: Notable 2024 spend with entities controlled by Schmitz and other insiders (e.g., aviation, rentals, equipment, consulting) elevates conflict‑of‑interest risk; however, WTTR maintains a formal related‑party review policy under Audit Committee oversight .
- Shareholder sentiment: ~98% say‑on‑pay support and robust governance policies (ownership guidelines, anti‑hedging, clawback) suggest low immediate compensation‑related overhang .
- Track record: 2024 TSR (+79%), $1.5B revenue, and strong cash generation underpin compensation outcomes and support confidence in execution under Schmitz’s leadership .
Citations: All facts, numbers, dates, and statements are sourced from Select Water Solutions, Inc. (WTTR) 2025 DEF 14A, with references in [document_id:chunk_index] format.