Steve Towe
About Steve Towe
Steve Towe (age 53) is Chief Executive Officer and a director of Powerfleet, Inc. (AIOT), serving since January 2022, with 20+ years scaling global SaaS and IoT businesses . In fiscal 2025, Powerfleet executed two transformative deals (MiX Telematics combination and Fleet Complete acquisition), driving revenue to $362.5M (+26% pro forma), Adjusted EBITDA to $71M (+65%), and EBITDA margin ~20%, with ~2.8M subscribers and ~48,000 customers; annualized cost synergies reached ~$16M . Total shareholder return (TSR) for a $100 investment stood at $115.82 for FY2025; GAAP net loss was ~$51.0M, reflecting transformation costs . The Board separates Chair and CEO roles, with an independent Chair, and all key committees are fully independent .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Aptos, Inc. | President & COO | 2016–Dec 2021 | Led global enterprise retail SaaS operations and growth . |
| Masternaut | Chief Commercial Officer | 2011–2016 | Senior leadership at global telematics provider; deepened IoT domain expertise . |
| Cybit Ltd | Managing Director; Director of Group Operations | 2002–2011 | Operations and leadership at data/telematics consolidator . |
| Fleetstar (Trafficmaster Group) | Founding member, senior executive | 2001–2002 | Helped launch fleet management subsidiary . |
| WH Smith | Various leadership roles | Early career | Retail leadership foundation . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| I.D. Systems, Inc. (wholly owned subsidiary) | Director | Current | Governance and oversight at subsidiary level . |
| Powerfleet Israel Ltd. (wholly owned subsidiary) | Director | Current | Supports international operations governance . |
Fixed Compensation
| Component | FY2023 | 2024 Transition Period (Jan 1–Mar 31, 2024) | FY2025 | Notes |
|---|---|---|---|---|
| Base Salary ($) | 425,000 | 106,250 | 425,000 (annual) ; increased to 535,000 in Mar 2025 | FY2025 base set at $425k; Company-wide merit increase raised CEO base to $535k in March 2025 . |
| Target Annual Bonus (% of salary) | 100% | — | 100% | Under Global Bonus Plan (GBP) . |
Performance Compensation
Annual Cash Bonus – Structure and FY2025 Payout
| Metric | Weighting | Threshold ($M) | Target ($M) | Maximum ($M) | Actual ($M) | Payout Outcome |
|---|---|---|---|---|---|---|
| Global Adjusted EBITDA | 50% | 62.1 | 69.0 | 75.9 | 71.1 | Executives earned 100% of target bonus . |
| Global Revenue | 30% | 326.6 | 362.9 | 399.2 | 362.5 | Executives earned 100% of target bonus . |
| Cash from Organic Operations | 20% | 36.1 | 40.1 | 44.1 | 41.9 | Executives earned 100% of target bonus . |
| FY2025 Cash Incentives | Amount ($) |
|---|---|
| GBP annual bonus paid | 535,000 |
| MiX Combination transaction bonus | 1,700,000 |
| Fleet Complete transaction bonus | 535,000 (price hurdle and GBP target achieved) |
| Total “Non-Equity Incentive Plan Compensation” (proxy classification) | 2,770,000 |
Notes:
- GBP metrics and definitions disclosed; CEO target bonus = 100% of base salary .
- FC transaction bonus required 30-day VWAP > $5.00 and FY2025 GBP target; both achieved by March 31, 2025 .
Long-Term Incentive Program (LTIP) – FY2025 Grants
| NEO | Target LTIP Value ($) | Time-based RS ($) | Performance-based RS ($) |
|---|---|---|---|
| Steve Towe | 2,500,000 | 833,333 | 1,666,667 |
Additional LTIP terms:
- Grant date: March 30, 2025; performance years measured only for FY2026 and FY2027 due to integration; vesting of performance RS occurs one year after each performance year-end . Time-based RS vests in equal annual installments over 3 years from grant .
- Performance metrics: Adjusted EBITDA less SBC, organic revenue growth, and adjusted EBITDA margin; potential +25% target shares for higher CAGR/margin outcomes; 0–150% payout range .
- CEO share counts: 174,337 time-based RS; 348,675 performance-based RS; shares based on 60-day VWAP of $4.78; grant date closing price was $5.59 .
One-Time CEO Performance-Oriented Equity Award (Granted Mar 30, 2025)
| Tranche | Shares | Hurdle (60-Day VWAP) | Vesting |
|---|---|---|---|
| Time-based RS | 312,500 | — | Equal annual installments over 3 years from grant . |
| Performance RS Tranche 1 | 312,500 | $6.00 | Hurdle achieved Jan 1, 2025; vests in equal annual installments over 3 years from achievement . |
| Performance RS Tranche 2 | 312,500 | $8.00 | Not achieved by Mar 31, 2025 . |
| Performance RS Tranche 3 | 312,500 | $10.00 | Not achieved by Mar 31, 2025 . |
Equity Ownership & Alignment
Beneficial Ownership (as of July 25, 2025)
| Holder | Shares Beneficially Owned | % Outstanding |
|---|---|---|
| Steve Towe | 2,934,766 (incl. 500,000 options exercisable within 60 days) | 2.2% |
- Shares outstanding: 133,443,292 .
- Insider trading policy and clawback: Company maintains insider trading policy; Dodd-Frank-compliant clawback adopted Nov 30, 2023 .
Outstanding CEO Equity Awards (Mar 31, 2025)
| Instrument | Status | Quantity | Exercise/Price Hurdle | Expiration/Vesting |
|---|---|---|---|---|
| Stock Options | Exercisable | 500,000 | $4.81 | 1/5/2032 . |
| Stock Options | Unexercisable | 875,000 | $10.50 (vests upon 60-Day VWAP ≥ hurdle) | 1/5/2032 . |
| Stock Options | Unexercisable | 1,250,000 | $14.00 (vests upon 60-Day VWAP ≥ hurdle) | 1/5/2032 . |
| Stock Options | Unexercisable | 2,000,000 | $21.00 (vests upon 60-Day VWAP ≥ hurdle) | 1/5/2032 . |
| Time-based RS (annual LTIP) | Unvested | 174,337 | — | Vests equal annual over 3 years from 3/30/2025 . |
| Performance RS (annual LTIP target) | Unearned | 348,675 | EBITDA less SBC, organic revenue growth, EBITDA margin (FY26–27) | Vests 1-year post each performance year; 0–150% payout . |
| One-time CEO Time-based RS | Unvested | 312,500 | — | Equal annual over 3 years from 3/30/2025 . |
| One-time CEO Performance RS | Unvested | 312,500 | $8.00 hurdle | Equal annual over 3 years from achievement (not met by 3/31/2025) . |
| One-time CEO Performance RS | Unvested | 312,500 | $10.00 hurdle | Equal annual over 3 years from achievement (not met by 3/31/2025) . |
Vesting supply considerations:
- Time-based grants create predictable quarterly/annual vesting through FY2027 .
- Price-hurdle options/RS add conditional supply at $6/$8/$10/$10.50/$14/$21 VWAP levels; $6 tranche already triggered, creating a 3-year vest tail from Jan 1, 2025 .
Pledging/Hedging:
- No explicit pledging disclosure in the proxy; company has an insider trading policy on purchases/sales/dispositions .
Employment Terms
| Term | Detail |
|---|---|
| Employment agreements | Company states no employment agreements with executive officers . |
| CEO Severance (no CIC) | Upon termination without cause: cash equal to 2x annual base salary, paid over 12 months; COBRA contribution waiver for 12 months; pro-rata vesting of outstanding equity based on time elapsed; 2x annual bonus otherwise payable for the fiscal year of termination; subject to release . |
| CEO Severance (within 6 months post-CIC or resignation for good reason) | Same severance framework as above; equity plan separately provides double-trigger acceleration for options/RSUs/PSUs upon qualifying termination within 1 year post-CIC . |
| Restrictive covenants | CEO severance agreement includes confidentiality, assignment of inventions, non-competition, and non-solicitation covenants (duration not specified) . |
| Equity plan CIC terms | Double-trigger: if terminated not for cause or leaves for good reason within 1 year post-CIC, options/RS vest; performance awards payout based on goal attainment (no downward discretion) . |
Board Service & Governance
- Role: CEO and director since January 2022; employee directors receive no additional director compensation .
- Board structure: 5 directors; majority independent; separate Chair (Michael Brodsky) and CEO roles; independent Audit, Compensation, and Nominating committees .
- Committees: CEO not listed as a committee member; Audit (McConnell Chair), Compensation (Martin Chair; changed from Brodsky in Sep 2024), Nominating (Jacobs Chair) .
- Attendance: Board held 20 meetings in FY2025; each director attended >75% of applicable meetings .
- Say-on-Pay: 2024 approval 77.5% .
Performance & Track Record
| Metric | FY2023 | 2024 Transition Period | FY2025 | Notes |
|---|---|---|---|---|
| Revenue ($M) | — | — | 362.5 | +26% pro forma; ~75% SaaS revenue . |
| Adjusted EBITDA ($M) | — | — | 71.0 | +65% YoY; margin ~20% . |
| Subscribers (approx.) | — | — | 2.8 million | Post-deal scale . |
| Customers (approx.) | — | — | 48,000 | Global footprint . |
| TSR (value of $100 investment) | 72.15 (FY2023) | 112.66 (2024 TP) | 115.82 (FY2025) | CAP discussion notes ~60.5% increase 2023→2025 . |
| Net loss ($K) | 5,675 | 8,515 | 50,987 | Transformation and integration effects . |
Compensation Structure Analysis
- Shift to performance equity: 66.7% of annual LTIP in performance-based RS tied to growth and margin, with delayed goal-setting for integration—performance measured in FY2026–FY2027 only; aligns equity with multi-year outcomes but defers measurement risk into outer years .
- Price-hurdle awards: One-time CEO award plus sizeable option tranches vest only above rigorous VWAP hurdles ($6–$21), creating strong share-price alignment and conditioning future supply on market cap accretion .
- Cash vs equity mix: FY2025 includes significant one-time transaction bonuses ($1.7M MiX; $0.535M FC) and 100% GBP payout; enhances near-term cash comp while equity remains majority of target TDC (87% “at-risk” for CEO) .
- Governance improvements: New Comp Committee Chair (Sep 2024) and peer group refresh; inclusion of voluntary CD&A while a smaller reporting company .
- Clawback compliance: Dodd-Frank clawback adopted Nov 30, 2023 .
- Say-on-Pay: 77.5% support in 2024 indicates moderate shareholder backing with room to improve alignment narrative .
Risk Indicators & Red Flags
- Internal controls history: EY communicated material weaknesses as of Dec 31, 2023 (and 2022); remediation underway; Deloitte appointed for FY2025 audit .
- Section 16 timeliness: Towe and others had late-filed Form 4s related to 2024 transactions; company disclosed exceptions and overall compliance status .
- Related party: Director compensation paid to PCM and issuance of PCM Warrant tied to director’s employer policy; Board-approved; not involving CEO directly .
- Equity supply overhang: Significant unvested RS/option pools at specific price hurdles could create selling pressure upon vesting/attainment .
Equity Ownership & Director Compensation (Board Context)
- CEO ownership: 2.2% beneficial ownership aligns CEO with shareholders; includes 500,000 currently exercisable options .
- Board pay: Non-employee director program targets ~$175,000 value (cash + RS), with supplemental chair retainers; employee director (CEO) receives no additional board pay .
Employment Terms – Additional Notes
- No CEO employment contract; severance covers both non-CIC and CIC-related terminations; includes double-trigger equity acceleration under the 2018 Plan upon qualifying termination within 1 year post-CIC .
- CEO restrictive covenants include non-compete and non-solicit; specifics not disclosed in proxy .
Investment Implications
- Alignment and upside leverage: High proportion of performance equity, price-hurdle RS, and large option tranches align CEO wealth with sustained TSR and operating performance; $8/$10/$10.50/$14/$21 hurdles provide embedded catalysts but also delay monetization until value creation materializes .
- Near-term vesting supply: Multiple time-based RS schedules started 3/30/2025 and 1/1/2025 (for the $6 tranche) create steady vesting through FY2027—track these dates for potential insider selling windows; note standard blackout/trading policy constraints .
- Retention and protection: Severance economics (2x salary and 2x bonus; partial equity acceleration) and strong unvested equity create retention hooks; double-trigger protections limit CIC windfalls without an actual termination, which is shareholder-friendly .
- Execution risk: Integration benefits evident (revenue/EBITDA growth, synergies), but GAAP losses and a history of control weaknesses elevate execution and reporting risk; ongoing governance enhancements (Comp Chair change, peer-group refresh, clawback) mitigate but don’t eliminate risk .
- Governance structure: Separate Chair/CEO, fully independent committees, and majority-independent board reduce dual-role concerns despite CEO-director status; Say-on-Pay at 77.5% suggests investor acceptance with sensitivity to extraordinary awards/bonuses during transformation .