Form 4: RYAM Grants CEO Scott Sutton 1.5M Performance Share Units

Rayonier Advanced Materials Inc. granted President and CEO Scott McDougald Sutton 1.5 million performance share units as an employment inducement award.

Summary

• Scott McDougald Sutton, President and CEO of Rayonier Advanced Materials Inc. (RYAM), was granted 1,500,000 Performance Share Units (PSUs) on January 9, 2026.
• This award serves as an employment inducement in connection with his commencement of employment as President and Chief Executive Officer.
• The grant was approved by the Compensation and Management Development Committee of the Board, outside the company's 2023 Incentive Stock Plan, pursuant to NYSE Listing Rule 303A.08.
• Each PSU represents the contingent right to receive one share of the company's common stock, subject to the achievement of stock price-based performance objectives over a three-year period.
• The number of PSUs that can be earned ranges from 0% to 200% of the target, with a maximum of 1,500,000 shares issuable.
• Any earned PSUs will vest on January 5, 2029, which is the third anniversary of Mr. Sutton's first day of employment, contingent on continued service and certification by the Compensation and Management Development Committee.
• Shares issued upon vesting will be subject to a one-year post-vesting holding requirement.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive as the grant aligns executive incentives with shareholder interests, but it's a standard compensation event rather than a direct operational or financial performance update.

Positives

• The grant of Performance Share Units (PSUs) aligns the President and CEO's long-term incentives directly with the company's stock price performance, potentially benefiting shareholders.
• The award was approved by the Compensation and Management Development Committee and granted under NYSE Listing Rule 303A.08, indicating adherence to corporate governance standards for inducement awards.

Negatives

• The potential issuance of up to 1,500,000 shares could lead to dilution for existing shareholders if the maximum performance level is achieved.

Risks

• The value of the PSUs is contingent on the achievement of stock price-based performance objectives, meaning the actual number of shares received could be zero if performance targets are not met.
• Vesting is subject to continued service, posing a risk if the CEO's employment terminates before the vesting date.

Future Outlook

The grant of performance-based compensation to the President and CEO signals a strategic focus on achieving specific stock price performance objectives over a three-year period, aiming to align executive incentives with long-term shareholder value creation.

Industry Context

Performance-based equity awards, such as Performance Share Units, are a common component of executive compensation packages in publicly traded companies across various industries. They are designed to incentivize leadership to achieve strategic financial and operational goals that drive shareholder value.

Management Changes

Corporate Governance

Related Party Transactions

• The grant of Performance Share Units to Scott McDougald Sutton, the President and CEO, constitutes a related party transaction as it involves compensation provided by the company to a key executive.

Stakeholder Impact

• Shareholders: Potential for long-term value creation if performance targets are met, but also potential for dilution if the maximum number of shares are issued.
• Employees: The compensation structure for the CEO may influence overall compensation philosophy and morale within the company.
• Management: Provides significant incentive for the President and CEO to drive stock price performance and remain with the company.

Next Steps

• The company's stock price performance will be measured over a three-year period to determine the number of PSUs earned.
• The Compensation and Management Development Committee will certify the achievement of performance objectives.
• Any earned PSUs will vest on January 5, 2029, subject to continued service.
• Shares issued upon vesting will be subject to a one-year post-vesting holding requirement.

Key Dates

Keywords

Performance Share Units, Executive Compensation, CEO Grant, RYAM, Rayonier Advanced Materials, Inducement Award, Stock Price Performance, Vesting, Corporate Governance