David W. Smail
ADTAbout David W. Smail
David W. Smail is Executive Vice President, Chief Legal Officer and Secretary of ADT, age 59, serving since February 2019, with more than 30 years of legal experience including public company GC roles and law firm partnership; he holds a JD cum laude from Harvard Law School and a BA summa cum laude from Macalester College . ADT’s incentive framework ties NEO pay to Adjusted EBITDA, Ending RMR, and stock price; in 2024 the AIP paid at 95% of target based on 100.05% of Adjusted EBITDA and 99.45% of Ending RMR targets . Company performance context in 2024: TSR value of $97 on a $100 base, peer TSR $154.8, Net Income $501,053k, Adjusted EBITDA $2,578,195k .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Scientific Games Corporation | EVP & Chief Legal Officer | 2015–2018 | Led legal for global gaming/lottery technology provider |
| Morgans Hotel Group | EVP & General Counsel | — | Senior legal leadership for international hospitality company |
| Havas S.A. | EVP & Group General Counsel | — | Oversaw global advertising/communications legal function |
| Hogan Lovells (Hogan & Hartson) | Partner | — | Corporate and securities transactional practice |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | 546,633 | 565,765 | 585,566 |
| Base Salary Level | Dec 31, 2023 | Dec 31, 2024 | Increase % |
|---|---|---|---|
| Amount ($) | 570,963 | 590,947 | 3.50% |
| Bonus Target | Target % of Base | Actual 2024 Bonus ($) | Payout vs Target |
|---|---|---|---|
| Annual Incentive | 100% | 561,399 | 95% |
Performance Compensation
| Annual Incentive Performance (2024) | Weight | Target | Actual | Performance vs Target | Weighted Performance |
|---|---|---|---|---|---|
| Adjusted EBITDA ($mm) | 50% | 2,577 | 2,578 | 100.05% | 51% |
| Ending RMR ($mm) | 50% | 361.5 | 359.5 | 99.45% | 44% |
| Total | — | — | — | — | 95% |
| 2024 LTIP Equity (Stock Options) | Grant Date | Number of Options | Exercise Price ($/sh) | Vesting | Expiration | Grant-Date Fair Value ($) |
|---|---|---|---|---|---|---|
| Non-qualified stock options | 3/8/2024 | 460,829 | 6.51 | One-third per year (service-based) | 3/8/2034 | 1,184,331 |
| RSU Vesting Schedules (Unvested as of 12/31/2024) | Grant Date | Shares | Vesting Dates |
|---|---|---|---|
| Time-based RSUs | 3/2/2022 | 33,827 (incl. DEUs) | Fully vested on 3/2/2025 |
| Time-based RSUs | 3/1/2023 | 68,874 (incl. DEUs) | Two equal installments on 3/1/2025 and 3/1/2026 |
| 2019–2020 Legacy Options (Exercisable) | Grant Date | Exercisable (#) | Exercise Price ($) | Expiration |
|---|---|---|---|---|
| 2019 LTIP / initial grant | 3/14/2019 | 358,851 | 5.48 | 3/14/2029 |
| 2020 LTIP | 3/9/2020 | 130,562 | 5.27 | 3/9/2030 |
| Stock Vested in FY 2024 | RSUs Vested (#) | Value Realized ($) |
|---|---|---|
| David W. Smail | 93,953 | 685,857 |
Equity Ownership & Alignment
| Beneficial Ownership (as of 3/26/2025) | Common Stock | Vested Options | Total Beneficially Owned | Ownership % of Shares Outstanding |
|---|---|---|---|---|
| David W. Smail | 364,113 | 643,021 | 1,007,134 | <1% |
- Stock ownership guidelines: Executive Officers must hold equity equal to 2x annual base salary; counting actual shares and unvested time-based RSUs; options and unearned performance shares do not count .
- Anti-hedging, short-sale, and anti-pledging: All personnel prohibited from hedging and short selling; pledging/margin purchases prohibited (grandfathered pledges from July 2021 allowed to remain) .
- Clawbacks: Policy allows recovery of incentive compensation in event of restatement; Dodd-Frank/NYSE-compliant clawback policy adopted .
Employment Terms
| Role & Start | Tenure | Offer Letter | Good Reason Triggers |
|---|---|---|---|
| EVP, Chief Legal Officer & Secretary | Since Feb 1, 2019 | Offer letter dated Feb 1, 2019 | Decrease in base or target bonus; failure to pay compensation; material diminution of duties; relocation >30 miles from Boca Raton; material breach by Company |
| Restrictive Covenants | Duration | Notes |
|---|---|---|
| Employment agreement non-compete/non-solicit | 24 months post-employment | Applies to competition and solicitation; severance conditioned on compliance |
| Equity award non-compete/non-solicit | 12 months post-termination | Runs concurrent with employment covenants |
| Severance & CIC Economics (as of 12/31/2024) | With Qualified Termination (no CIC) | With Qualified Termination after CIC | Retirement | Death/Disability |
|---|---|---|---|---|
| Cash Severance ($) | 1,181,894 | 1,181,894 | — | — |
| Prorated Bonus ($) | 561,399 | 561,399 | — | — |
| Benefit Continuation ($) | 31,253 | 31,253 | — | — |
| Accelerated RSU Vesting ($) | — | 709,664 | 709,664 | 709,664 |
| Total ($) | 1,774,546 | 2,484,210 | 709,664 | 709,664 |
- CIC vesting: Double-trigger—unvested awards (other than Legacy awards) vest upon termination without Cause or resignation for Good Reason within 24 months after CIC .
- Excise tax gross-ups: ADT does not provide 280G/4999 excise tax gross-ups to NEOs .
Deferred Compensation
| SSRP (Non-Qualified Deferred Compensation, FY 2024) | Executive Contributions ($) | Company Contributions ($) | Aggregate Balance at Year-End ($) |
|---|---|---|---|
| David W. Smail | 35,064 | 58,930 | 515,539 |
Compensation Structure Context
- Pay-for-performance design: AIP metrics focused on Adjusted EBITDA and Ending RMR; 2024 equity grants delivered solely as stock options to ensure value only if stock price rises .
- Peer group: Committee, advised by Pearl Meyer, uses subscription/tech-enabled B2C/B2B companies ($2–$10B revenue); updated 2025 peer group with replacements for size comparability and acquisition removals . Independent consultant Pearl Meyer engaged; independence reviewed with no conflicts .
- Say-on-Pay: ~99% approval at 2024 Annual Meeting .
Investment Implications
- Alignment: 2024 move to options-only LTIP increases sensitivity to long-term stock price appreciation and strengthens alignment; AIP metrics tied to Adjusted EBITDA and Ending RMR create direct linkage to subscriber economics .
- Retention risk: Retirement eligibility under equity plans means awards continue to vest post-retirement, potentially lowering the retention “hook”; however 24-month non-compete/non-solicit and severance covenants provide guardrails .
- Insider selling pressure: RSU vesting in March 2025 and March 2026 and 2024 vesting activity (93,953 RSUs vested, $685,857 realized) may create near-term delivery, but hedging/pledging prohibitions and trading window controls limit opportunistic selling; 10b5-1 plans permitted only with CLO approval and cooling-off periods .
- Ownership: Smail’s economic exposure is primarily through options and a modest shareholding (<1% of outstanding), with stock ownership guidelines requiring 2x salary—monitor for progress to guideline compliance over time .