Apr 02, 2023

Chemours Company CFO resigns

Lock, who first joined the company in 2018, has served in his role as chief development officer — where he led their corporate strategy, M&A and investor relation functions, among other responsibilities — starting in November 2021.

As CFO, Lock will receive an annual base salary of $600,000, according to the company filing. He will also be eligible for a target annual incentive plan award of 75% of his base, as well as a target long-term incentive plan award of $1 million.

An eight-year veteran of the company, Ralhan has served as Chemours’ finance chief since 2019, according to his LinkedIn profile. As CFO, Ralhan's total compensation for 2022 included a base salary of $625,000 and an annual incentive of $394,000, according to the company's proxy statement.

As well as appointing a new CFO and chief enterprise transformation officer, as part of its finance chief shift, the responsibility for the company's sustainability organization will shift over to Kristine Wellman, the company's SVP, general counsel and corporate secretary.

In a statement included in the Tuesday announcement, Chemours President and CEO Mark Newman said that Lock's appointment as CFO will ensure the company "does not miss a beat" in delivering long-term value to its shareholders. Newman has "every confidence" that the company will be able to continue executing its growth strategy, he said in a statement regarding the company's executive moves.

Ralhan's resignation comes after Chemours, alongside fellow chemical companies Corteva and DuPont, announced they would pay more than $1 billion to settle claims of "forever chemicals" that have contaminated U.S. public water systems. The agreement follows a Memorandum of Understanding reached by the three companies in January 2021.

Chemours, which produces specialty and industrial chemicals for numerous industries including refrigeration and air conditioning, transportation, semiconductor and consumer electronics, general industrial, and oil and gas, is one among several in the space facing numerous claims which allege that toxic chemicals — per- and polyfluoroalkyl chemicals, or PFAS — were utilized in manufacturing before leaching into the environment, according to a report by CNN. The synthetic substances, which can be found in everyday objects, can cause serious health problems when entering the human body, the report said.

Chemours and the two other chemical companies reached a tentative settlement, with a definite agreement expected later this year subject to approval by the U.S. District Court for the District of South Carolina, according to a Friday release.

According to the tentative agreement, the three companies will collectively pay $1.185 billion into a settlement fund, with Chemours — a DuPont spinoff — contributing 50% or about $592 million of the total funds. DuPont will contribute about $400 million, while Corteva will round out the fund with a contribution of approximately $193 million.

"The agreement is expected to comprehensively resolve all PFAS-related drinking water claims (regardless of whether resulting from aqueous film-forming foam ("AFFF") usage) of a defined class of water systems, which collectively serve the vast majority of the U.S. population," Chemours wrote in a Q&A regarding the settlement on its website.

Water systems operated by a state or U.S. government are excluded from the settlement, according to the Friday press release, as are small systems that have not detected the presence of PFAS and are not required to monitor for it.

As part of the company's aim to foster value to its shareholdersd a key priority is to "manage and resolve legacy liabilities, consistent with our MOU framework in coordination with DuPont and Corteva," Newman said in April during the company's Q1 2023 earnings call.

For the quarter ending March 31, Chemours reported net sales of $1.5 billion, a 13% decrease compared to the prior year period, according to its earnings results, as well as adjusted EBITDA of $304 million. The company reaffirmed its full-year guidance, expecting adjusted EBITDA of between $1.20 billion - $1.30 billion.

Chemours did not respond to requests for comment on the settlement or on the resignation of its CFO.