Richard Raborn
About Richard H. Raborn
Executive Vice President, Vegetation Management at Alamo Group Inc. (ALG) and a 2024 Named Executive Officer driving division-level profitability and safety outcomes under ALG’s pay-for-performance framework . In 2024, ALG delivered net sales of ~$1.6B, fully diluted EPS of $9.63, and EBITDA of $221M as management navigated a labor strike and restructuring actions; five-year cumulative TSR through 12/31/2024 equaled 151.71 vs. 149.37 for the S&P SmallCap 600 and 176.44 for the S&P 500 Industrials . Raborn had 9 years of credited service under ALG’s SERP as of 12/31/2024 (vesting at 10 years), indicating multi-year tenure with the company .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | — | — | Not disclosed in filings reviewed |
External Roles
| Organization | Position | Years | Notes |
|---|---|---|---|
| — | — | — | Not disclosed in filings reviewed |
Fixed Compensation
- 2024 base salary: $506,000; 2023 base: $486,500; 2022 base: $467,100 .
- Target annual bonus: 60% of base salary (unchanged 2023→2024) .
- Perquisites and benefits include car allowance and 401(k) restoration program participation (company-wide program terms summarized; individual amounts itemized at total “All Other Compensation”) .
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $467,100 | $486,500 | $506,000 |
| Target Bonus (% of Base) | — | 60% | 60% |
| Non-Equity Incentive Paid ($) | $372,045 | $324,593 | $53,722 |
| All Other Compensation ($) | $23,064 | $30,455 | $27,116 |
Performance Compensation
Annual Cash Incentive (EIP) – 2024 design and outcome (Division EVP)
- Weighting and metrics for Raborn’s 2024 plan emphasized division EBIT (45%), inventory turnover (25%), sales growth (10%), safety (recordable injury rate, 5%), plus company pre-tax income (15%) .
- 2024 formulaic results: 0% on division EBIT, sales growth, and division inventory turnover; 10% on division safety; 8% on company pre-tax income; resulting cash payout: $53,722 .
| Metric (2024 EIP) | Weight | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Division EBIT | 45% | Not disclosed | Not disclosed | 0% | Cash (annual) |
| Company Pre‑Tax Income | 15% | $197.3M target (company-level) | $158.9M adjusted | 8% | Cash (annual) |
| Division Sales Growth | 10% | Not disclosed | Not disclosed | 0% | Cash (annual) |
| Division Inventory Turnover | 25% | Not disclosed | Not disclosed | 0% | Cash (annual) |
| Division Recordable Injury Rate | 5% | Not disclosed | Not disclosed | 10% | Cash (annual) |
Note: Company-level EIP metrics for 2024 used adjusted pre‑tax income and inventory turnover, with explicit adjustment add-backs for strike and restructuring ($3.6M, $6.1M) applied to EIP determinations .
Long-Term Equity (PSUs and RSAs)
- Structure: 50% PSUs, 50% time-based RSAs for NEOs; PSUs vest on 3-year performance (cumulative operating income growth and average ROIC, equally weighted); RSAs vest ratably over 3 years; RSAs are double-trigger accelerated on CIC terminations (PSUs pro‑rated on CIC) .
- 2022–2024 PSU cycle: Operating income growth target $515.16M (threshold $372.06M, max $629.64M); ROIC target 16.8% (threshold 12.1%, max 20.5%). Actuals: $511.4M operating income (near target) and 16% ROIC; payout 95% of target. Raborn’s awarded PSUs: target 1,452; earned 1,379 shares .
- 2024 equity grants to Raborn: 1,476 RSAs and 1,476 target PSUs .
| PSU Cycle | Metric | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|---|
| 2022–2024 | Cumulative Operating Income ($M) | 372.06 | 515.16 | 629.64 | 511.4 | 95% (combined) |
| 2022–2024 | Average ROIC (%) | 12.1% | 16.8% | 20.5% | 16.0% | 95% (combined) |
| Equity Grants (Shares) | 2023 | 2024 |
|---|---|---|
| RSAs | 1,404 | 1,476 |
| PSUs (Target) | 1,404 | 1,476 |
| 2022–2024 PSU Awarded | — | 1,379 (for 2022–2024 cycle) |
Equity Ownership & Alignment
- Beneficial ownership (as of 2/21/2025): 11,061 shares; <1% of outstanding (Company-wide shares outstanding 12,063,468) .
- Unvested/uneamed equity (as of 12/31/2024): RSAs 484 (2022 grant), 936 (2023), 1,476 (2024); PSUs unearned 1,404 (2023 cycle), 1,476 (2024 cycle). No options listed for Raborn .
- Ownership guidelines: Division EVPs must hold stock equal to 2.5x base salary; 5-year attainment window; executives must hold at least 50% of net shares until compliant. As of record date, all NEOs/Directors either met guidelines or were within the 5‑year transition period .
- Hedging and pledging: Prohibited for directors and executive officers; no pledging permitted (mitigates misalignment risk) .
- Clawback: Company maintains a clawback policy covering performance-based compensation for NEOs .
| Ownership Detail | Count/Status |
|---|---|
| Beneficially owned shares (2/21/2025) | 11,061; <1% of class |
| Unvested RSAs (12/31/2024) | 484 (2022) ; 936 (2023) ; 1,476 (2024) |
| Unearned PSUs (12/31/2024) | 1,404 (2023 cycle) ; 1,476 (2024 cycle) |
| Stock options | None listed for Raborn |
| Ownership guideline | 2.5x base (Division EVP); 5-year window; hold 50% of net shares until compliant |
| Hedging/pledging | Prohibited for directors and executive officers |
Employment Terms
- Employment agreement: None; NEOs serve at the Board’s discretion .
- Change-in-control/severance: Double-trigger. If terminated without cause/for good reason within 6 months before or 24 months after a CIC, Raborn receives cash severance equal to 2x (base + target bonus), acceleration of time-based equity (RSAs/options), and health benefit reimbursements; PSUs are not accelerated but pro‑rated on CIC .
- Potential CIC termination payouts (as of 12/31/2024, stock at $185.91): Severance $1,619,200; accelerated equity $802,960; aggregate $2,422,160 .
- SERP (Supplemental Executive Retirement Plan): Present value $698,388 as of 12/31/2024; vesting at 10 years of credited service; not yet vested as of 12/31/2024; monthly installments over 15 years when payable (or lump sum on death/CIC) .
- Deferred Compensation Plan (effective 1/1/2026): New unfunded plan allowing discretionary Company contributions up to 6% of base + bonus, 3-year cliff vesting, and 100% vest on CIC; participant eligibility determined by the Compensation Committee (named initial participants: CEO, CFO, EVP Industrial Equipment) .
| Term | Key Details |
|---|---|
| Employment agreement | None |
| CIC severance factor | 2x (base + target bonus) |
| CIC payout illustration (12/31/2024) | $1,619,200 severance; $802,960 equity; total $2,422,160 |
| PSU treatment on CIC | Pro‑rated vesting during performance period (Committee determination or target if indeterminable) |
| RSAs treatment on CIC term | Double-trigger acceleration on qualifying termination |
| SERP | $698,388 PV; 10-year vest; 9 years credited service (12/31/2024) |
| Deferred Comp Plan (2026) | Up to 6% discretionary; 3-year cliff; CIC immediate vest; eligibility by Committee |
| Clawback | Applies to performance-based pay |
| Hedging/pledging | Prohibited for execs/directors |
Compensation Structure Analytics
- Mix shift and pay-for-performance: 2024 EIP for Raborn paid minimally ($53.7k) due to division EBIT/sales/inventory underperformance, despite company-level pre‑tax income component at 8% and division safety at 10%, indicating high sensitivity to operating execution in his division .
- Multi-year equity leverage: PSU framework balances growth (cumulative operating income) with capital efficiency (ROIC). The 2022–2024 cycle paid at 95% of target, awarding Raborn 1,379 shares (vs. 1,452 target), reinforcing aligned equity outcomes amidst mixed macro/operational conditions .
- Governance practices: No single-trigger CIC; no excise tax gross-ups; hedging/pledging prohibited; robust ownership guidelines; active clawback—all consistent with shareholder-friendly alignment .
- Say-on-pay: Strong support (approximately 99% approval in 2024), reducing headline governance risk around incentive design .
Investment Implications
- Alignment and signal: 2024 cash incentive outcome for Raborn (0% on division EBIT/sales/inventory turnover, modest on safety and company pre‑tax) underscores high operational accountability and credible pay-for-performance; equity PSU payout at 95% (2022–2024) evidences longer-term alignment with shareholder value creation .
- Vesting/supply overhang: Significant unvested RSAs (2,896 total across 2022–2024 grants) and unearned PSUs (2,880 across 2023–2024 cycles) vest through 2026; while hedging/pledging is prohibited, upcoming vests could create episodic insider selling windows (monitor Form 4 filings) .
- Retention dynamics: SERP vests at 10 years; with 9 years credited as of 12/31/2024, near-term vesting (2025) may reduce retention risk; new 2026 Deferred Compensation Plan with 3-year cliff and CIC vest features could further support retention for selected participants .
- Downside/CIC risk: Double-trigger CIC at a 2x multiple (cash) plus time-based equity acceleration is moderate vs. peers; PSUs avoid windfall via pro‑ration, mitigating acquisition-related pay spikes (shareholder-friendly) .
- Governance backdrop: Strong say‑on‑pay support, ownership guidelines, and clawback policy decrease governance overhang; continued emphasis on division-level EBIT and capital velocity metrics (inventory turns, ROIC) should be read as a signal of management’s operating discipline focus in Vegetation Management .