Today it was revealed that Traeger CEO, Jeremy Andrus, received an updated compensation plan. He originally had a plan dating back to 2021 where he didn’t receive a salary or a bonus. Instead, he was being compensated in equity awards tied to share value appreciation.
In addition, under the Side Letter, Mr. Andrus agreed (i) to reduce his annual base salary to $0 until December 31, 2026 and (ii) to not be eligible to receive an annual bonus with respect to 2021 or for any period prior to December 31, 2026. The Board believes that the lack of cash compensation, coupled with equity awards’ design (of vesting upon the achievement of significant stock price appreciation goals), ensures that Mr. Andrus’s compensation over the next several years is directly and solely tied to the Company’s achievement of superior performance.
Traeger 2021 S1/A Filing
That compensation structure made sense when the grill market was booming. Traeger shares peaked at a little under $30 in August of 2021, but are now trading at $1.49.
It could be argued that the CEO’s role is to increase share price, so the 2021 structure makes sense. In this environment though with a depressed sector and macro uncertainty, I don’t think there’s anything the Traeger CEO could do to return share price to its highs.
Under the new compensation plan, Jeremy Andrus will receive $750k in base salary and a target bonus equal to 150% of his base. Before reducing his salary in connection with the IPO, he received a base of $593,357 in 2020.
The new compensation is inline with the size of Traeger and it’s position in the market. As comparables, Revelyst had revenue forecasted to be near of $1.2 billion, and their CEO received a compensation package of $1.2 million in base and a bonus target up to 200%. When Alan Matula took over as CEO of Weber, he had an all-in compensation of $1.85 million.