Steven Udvar-Házy
AIR LEASEAbout Steven F. Udvar-Házy
Steven F. Udvar-Házy, age 79, is Air Lease Corporation’s founder and long-time aviation leasing pioneer. He served as Chairman and CEO from AL’s 2010 launch to July 2016, then as Executive Chairman; he announced retirement from his executive role effective at the May 2, 2025 Annual Meeting, with intent to continue as non-executive Chairman through the 2026 annual meeting if re-elected . He is not independent under NYSE rules as an employee director; after retirement as Executive Chairman he will still not meet NYSE independence criteria while serving as Chairman .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| International Lease Finance Corporation (ILFC) | Co-founder, Chairman & CEO | 1973–Feb 2010 | Industry-shaping growth of aircraft leasing; ILFC became AIG subsidiary in 1990 |
| Air Lease Corporation | Chairman & CEO | Feb 2010–Jul 2016 | Founded AL; led initial strategy and growth |
| Air Lease Corporation | Executive Chairman | Jul 2016–May 2025 (retiring from executive role) | Oversaw OEM and customer relationships in full-time executive role |
| Air Lease Corporation | Chairman (non-executive, proposed) | From May 2025 to 2026 annual meeting (if elected) | Preside at Board/stockholder meetings; continue Board leadership |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| SkyWest, Inc. | Senior Strategic Advisor; former Lead Director | Advisor current; Lead Director until May 2022 | Ongoing aviation network relationships |
| Public Company Directorships | None | — | No current public company boards |
Board Governance
- Board leadership: Serves as Chairman; independent Lead Director (Robert A. Milton) retains defined oversight responsibilities including executive sessions, agenda setting, evaluations, and shareholder communication .
- Committee participation: All standing committees (Audit; Nominating & Corporate Governance; Leadership Development & Compensation) are composed solely of independent directors; his name does not appear on committee rosters .
- Independence: Not independent as Executive Chairman; will remain non-independent as Chairman post-retirement .
- Attendance: Board held 11 meetings in 2024; each director nominee attended 100% of Board/committee meetings, except two directors at 91%; all nine nominees attended the 2024 annual meeting .
- Executive sessions: Non-employee directors meet in executive session each Board meeting; chaired by Lead Director .
Fixed Compensation
| Component | Amount | Period/Terms | Notes |
|---|---|---|---|
| Base Salary (Executive Chairman) | $1,800,000 | 2024; unchanged since 2016 | Full-time executive role focused on customers/OEMs |
| Base Salary (Executive Chairman) | $1,800,000 | 2025 | Prorated for 2025 due to retirement timing; Annual incentive paid in cash for 2025, prorated |
| Life Insurance Premiums | $180,129 | 2024 | Company-paid premiums; separate $5.0M term life insurance policy |
| Personal Use of Company Aircraft (Incremental Cost) | $632,908 | 2024 | Travel policy requires CEO/Executive Chairman to use company aircraft; methodology disclosed |
| Non-Employee Director Cash Retainer | $80,000 | Standard for independent directors | If elected Chairman post-retirement, will receive non-employee director compensation |
| Additional Chairman Retainer | $50,000 | Annual, commencing post-meeting if elected | Approved by Board |
| Non-Employee Director Annual Equity Grant | $130,000 (value) | RSUs vest 1 year; can be deferred | Applies to Chairman post-retirement if elected |
Hedging and pledging of company stock are prohibited for directors and executive officers; clawback policy adopted Nov 2023 compliant with NYSE and Rule 10D-1 .
Performance Compensation
| Item | Metric/Structure | Amount | Terms |
|---|---|---|---|
| 2024 Annual Incentive (Executive Chairman) | Company Performance Factor 114%; Individual 100% | $2,462,400 | Paid as RSUs granted Mar 13, 2025; cliff vest 2 years; RSU count equals $2,462,400 ÷ $44.52 (grant-date close) |
| 2024 LTI RSUs – Book Value (50%) | Performance-based; 3-year period (2024–2026) | 45,721 target / 91,442 max RSUs | Payout schedule: 7.5% growth → 0%; 15% → 100%; 20.25% → 200% |
| 2024 LTI RSUs – TSR (25%) | Performance-based; 3-year period (2024–2026) | 22,861 target / 45,722 max RSUs | Relative to S&P MidCap 400: 55th pct → 100%; ≥85th → 200% |
| 2024 Time-based RSUs (25%) | Time vesting | 22,861 RSUs | Vest 33% on 2/25/2025, 33% on 2/25/2026, 34% on 2/25/2027 |
2024 Annual Bonus Performance Metrics and Outcomes
| Performance Measure | 2024 Target | Actual 2024 Result | Weight | Weighted Payout |
|---|---|---|---|---|
| Total Revenue ($) | $2,862.0M | $2,734.0M | 40% | 39% |
| Adjusted Net Income Before Income Taxes ($) | $754.0M | $574.0M | 40% | 35% |
| Increase Irish Presence (%) | 14% | 23% | 10% | 20% |
| % Fleet Newest Gen | 77% | 80% | 10% | 20% |
| Company Performance Factor | — | — | — | 114% |
Other Directorships & Interlocks
| Company | Role | Committee Roles |
|---|---|---|
| Public company boards | None | — |
| SkyWest, Inc. | Senior Strategic Advisor; former Lead Director (to May 2022) | — |
Related person transactions: Board policy requires Nominating & Corporate Governance Committee review; none (other than pre-approved categories) in 2024 .
Expertise & Qualifications
- 50+ years of aviation leasing experience; FAA Airline Transport Pilot with multiple jet type ratings .
- Deep OEM and airline relationship network, central to AL’s strategy and customer acquisition .
- Substantial shareholder providing alignment with long-term value creation .
Equity Ownership
| Holder | Shares Beneficially Owned | % Outstanding | Notes |
|---|---|---|---|
| Steven F. Udvar-Házy | 5,887,594 | 5.27% | Includes direct, family trusts, and controlled entities detailed in footnote (Air Intercontinental, Ocean Equities, Emerald Financial LLC, family trusts) |
| Ownership Alignment | Requirement | Actual | Valuation Date |
|---|---|---|---|
| Executive Stock Ownership Guidelines (6× salary) | $10.8M equivalent | 153× base salary; $274,924,981 | Price at Mar 7, 2025 |
| Outstanding RSUs (as of 12/31/2024) | Count | Market Value ($) |
|---|---|---|
| Book Value RSUs (2024 grant, target) | 45,721 | $2,204,209 |
| TSR RSUs (2024 grant, target) | 22,861 | $1,102,129 |
| Time-based RSUs (2024 grant) | 22,861 | $1,102,129 |
| Time-based RSUs in lieu of 2023 bonus | 79,440 | $3,829,802 |
| 2022 performance awards (vested in Feb 2025): Book Value 116%; TSR 100% | See notes | Performance certified; values included in potential payments analysis |
Hedging and pledging prohibited; director stock ownership guidelines for non-employee directors require 5× cash retainer; all independent directors in compliance as of Mar 7, 2025 .
Fixed Compensation (Director-specific going forward)
| Director Pay Element | Amount/Terms |
|---|---|
| Annual Board Retainer (non-employee) | $80,000 cash; paid quarterly |
| Committee Member Retainers | Audit $15,000; Comp $10,000; Nominating $10,000 |
| Committee Chair Premium | Audit $20,000; Comp $10,000; Nominating $10,000 |
| Lead Director Premium | $50,000 |
| Annual Director Equity (RSUs) | $130,000 grant value; 1-year vest; deferral option |
| Additional Chairman Retainer | $50,000 annually (for Mr. Udvar-Házy as Chairman post-meeting) |
Performance Compensation (Executive role prior to retirement)
| Award | Metric/Target | Result/Outcome |
|---|---|---|
| 2024 Annual Bonus | Target $2,160,000; cap 200% | Actual $2,462,400 paid as RSUs; granted 3/13/2025; vest at 2 years |
| LTI Mix (2024) | 50% Book Value RSUs; 25% TSR RSUs; 25% Time-based RSUs | Performance conditions and vesting schedules disclosed |
Employment & Contracts
- Retirement Letter Agreement (Mar 13, 2025): Salary continuation ($1.8M/year) and health coverage for two years; approx. $5.6M payable over two years (2× average bonus for prior three years); 2025 prorated cash bonus based on actual performance; continued vesting of outstanding RSUs while serving as Chairman; settlement timing defined; six-month non-compete post-Chairman; mutual non-disparagement; supersedes Severance Agreement/Irish employment agreement .
- Severance mechanics (historical agreement): Double-trigger CIC protection with 3× salary+target bonus; health/life premium cash payment for two years; full vesting at target for performance awards upon CIC termination; pro-rata payouts outside CIC; parachute cutback/best net .
Compensation Peer Group & Say-on-Pay Signals
- Custom Benchmark Group used for pay analysis: diversified financials, REITs, specialty finance (e.g., AMG, WPC, HST, GATX); AL highlighted for high revenue and net income per employee .
- Say-on-Pay 2024: Stockholders approved NEO compensation; approximately 94% of outstanding Class A common represented at the meeting voted in favor; committee increased goal rigor and shifted weighting to financial metrics in 2024 in response to investor feedback .
Related Party Transactions
- Policy: Formal Related Person Transaction Policy with committee oversight; pre-approved categories defined; no related person transactions (other than pre-approved) in 2024 .
- Tax equalization/gross-ups: Irish letter agreement provided tax equalization and potential gross-ups associated with dual employment in Ireland; these arrangements terminate with retirement, subject to accrued obligations .
Governance Assessment
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Strengths
- Founder-led strategic expertise and deep OEM/airline relationships, retained as non-executive Chairman, supports continuity amid complex delivery and rate environments .
- Independent Lead Director structure with clearly defined responsibilities, robust committee independence, and recurring executive sessions enhance oversight while balancing non-independent Chair influence .
- Strong alignment: significant personal share ownership (5.27% of AL), far exceeding stock ownership guidelines (153× salary; $274.9M), and prohibition on hedging/pledging; formal clawback policy .
- Director attendance strong; Board/committee independence; structured annual self-evaluation led by Lead Director .
-
Watch items / potential red flags
- Independence: As non-executive Chairman, he remains non-independent under NYSE rules, necessitating persistent reliance on Lead Director and committees for checks and balances .
- Perquisites: Material personal aircraft usage cost ($632,908) may draw scrutiny; however policy and methodology disclosed and consistent with role requirements .
- Tax equalization/gross-ups tied to prior dual employment in Ireland (contractual gross-ups) reflect shareholder-sensitive area; accrued obligations persist through retirement date .
- Concentrated ownership via family trusts and controlled entities increases influence; no related-party transactions in 2024, but ongoing monitoring warranted via committee policy .
-
Board effectiveness signals
- Compensation program changes (greater goal rigor, heavier financial weighting) and strong Say-on-Pay support in 2024 demonstrate responsive governance to shareholder feedback .
- Clear succession transition from Executive Chairman to non-executive Chairman with codified terms and continued RSU vesting during service promotes stability while reducing management entanglement .
Overall: Governance structures—independent committees, Lead Director empowerment, robust ownership alignment and formal clawback/anti-hedging—mitigate non-independence risks of a Chairman with substantial influence. Continued vigilance on perquisites, tax equalization legacy items, and related-person monitoring remains appropriate for investor confidence .