Stoneridge updates change in control terms, grants transaction bonus to executive

Stoneridge Inc . (NYSE:SRI), an automotive electronics manufacturer with a market capitalization of $221 million and annual revenue of $878 million, announced changes to executive compensation agreements following board approval on August 13. According to InvestingPro analysis, the company’s stock is currently trading below its Fair Value, despite showing strong momentum with a 76% price return over the past six months. According to a statement in a press release based on a recent SEC filing, Rajaey Kased, President of the company’s Control Devices division, entered into a new Change in Control (CIC) Agreement and a Transaction (JO:NTUJ) Bonus Letter Agreement.

The CIC Agreement amends and restates a prior agreement from February 1, 2023. Under the revised "double trigger" arrangement, Mr. Kased will be eligible for certain payments and benefits only if two conditions are met: a change in control of Stoneridge, which includes the sale of all or substantially all assets or stock of the Control Devices division before December 31, 2025, and a subsequent qualifying separation event within two years. This comes at a time when the company maintains a healthy liquidity position, with InvestingPro data showing a current ratio of 2.14, indicating strong ability to meet short-term obligations. A qualifying event is defined as a separation from service by the company or successor (other than for cause), or a resignation by Mr. Kased for good reason.

If both conditions are met and Mr. Kased provides a timely release, he will receive the following: two times the greater of his annual base salary at the time of the triggering event or at the change in control; two times the greater of his target annual incentive award at termination or the actual incentive award from the prior fiscal year; a pro rata incentive compensation amount based on achieved performance goals for the year of the triggering event; and continued life and health insurance benefits for 24 months following termination. The agreement does not include an excise tax gross-up payment.

In addition, the Transaction Bonus Letter Agreement provides for a $84,204 bonus to be paid to Mr. Kased upon the sale of all or substantially all assets of the Control Devices division. Payment is contingent on Mr. Kased’s continued employment and performance through the sale and execution of a standard release.

These changes were disclosed in a press release statement and detailed in the company’s filing with the Securities and Exchange Commission.

In other recent news, Stoneridge Inc. reported its financial results for the second quarter of 2025, highlighting a notable earnings miss. The company announced an earnings per share (EPS) of -$0.34, which was significantly below the forecasted -$0.09. Despite the earnings shortfall, Stoneridge’s revenue surpassed expectations, coming in at $228 million compared to the anticipated $219.9 million. These developments reflect the company’s ongoing financial challenges as well as its ability to generate higher-than-expected revenue. The earnings miss and revenue beat are important factors for investors to consider. Analysts and investors will be closely watching Stoneridge’s future performance and strategic decisions in light of these results. These recent developments underscore the importance of closely monitoring the company’s financial health.

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