Kevin Hostetler
Array TechnologiesAbout Kevin Hostetler
Kevin Hostetler, 56, has served as CEO and director of Array Technologies since April 2022. He holds a BS in Finance from King’s College and an MBA from NYU Stern, with 25+ years leading engineered products businesses and prior CEO roles at Rotork and FDH Velocitel . Under his tenure, Array’s 2024 revenue fell 42% and net income turned to a $240.4M loss amid a difficult solar cycle; pay-versus-performance disclosures show compensation actually paid to the CEO declined significantly in 2024, aligning with lower TSR and revenue outcomes . He is a Class III director (non-independent) with an independent board chair structure separating CEO and chair roles .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Rotork plc | Chief Executive Officer | Feb 2018–Apr 2022 | Led Growth Acceleration Program driving margin, capital efficiency and commercial excellence . |
| FDH Velocitel | Chief Executive Officer | Nov 2014–Feb 2018 | Led M&A to scale engineering and construction services for critical infrastructure . |
| Wind Point Partners | Executive Advisor | Mar 2012–Nov 2014 | PE operating advisor on middle-market growth and LBOs . |
| IDEX Corporation | Group President, FMT Segment and IDEX Asia (officer) | 2007–2012 | Led multi-platform businesses across energy, water, chemical, food, agriculture . |
| Ingersoll Rand | Progressive P&L and BD roles | 7 years (dates not disclosed) | Industrial segment leadership roles . |
External Roles
| Organization | Role | Years |
|---|---|---|
| Esdec Solar Group | Supervisory Board member | Since Jan 2023 |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 | 2025 (set) |
|---|---|---|---|---|
| Base salary ($) | 600,137 | 850,000 | 850,000 | 875,000 (+2.9%) |
| Perquisites/other comp ($) | 12,200 | 13,200 | 19,385 (401k match $13,800; physical $4,295; term life $1,290) | |
| Target annual bonus (% of salary) | — | — | 125% | — |
Performance Compensation
Annual Incentive (2024)
| Metric | Weight (%) | Threshold | Target | Stretch | Actual | Payout as % Target |
|---|---|---|---|---|---|---|
| Adjusted EBITDA ($) | 60 | 249M | 311M | 373M | 137M | 0% |
| Cash Conversion Cycle (days) | 30 | 99 | 83 | 66 | 66 | 200% |
| TRIR (bps) | 3.34 | 2.73 | 2.05 | 1.64 | 1.37 | — (part of MBOs) |
| On-Time Delivery (%) | 3.33 | 86 | 92 | 96 | 94 | — (part of MBOs) |
| Strategic Cost Objectives ($) | 3.33 | 4.0M | 6.0M | 8.0M | 9.0M | — (part of MBOs) |
| Corporate subtotal | 100 | — | — | — | — | 78% |
| Six-Month LIP Cash ($) | 60 | 275M | 300M | 325M | 364M | 200% |
| Six-Month LIP Gross Margin (%) | 25 | 31 | 32 | 33 | 32.2 | 117% |
| Six-Month LIP LSOW orders (#) | 15 | 4 | 4.5 | 6 | 6.9 | 200% |
| 2H subtotal | 100 | — | — | — | — | 179% |
| Final payout | — | — | — | — | — | Avg(78%,179%)=129% but capped at 95% |
- CEO bonus paid: $1,009,375 (95% of $1,062,500 target = 125% of $850,000 salary) .
Long-Term Incentives (2024 design and awards)
- 2024 LTIP mix: RSUs (time-based) and PSUs (performance-based). Annual RSUs vest 1/3 each year over 3 years; September 2024 Supplemental RSUs vest 66 2/3% at year 2 and 33 1/3% at year 3 for retention . 2022–2024 PSUs paid 0% (no metric achieved) .
- 2024 PSUs: 50% based on average annual revenue growth and 50% on average annual adjusted EPS growth over 2024–2026; final result modified by RTSR vs three solar peers (115%/100%/85% for 1st/2nd-3rd/4th) and capped at 200% .
- 2024 CEO grants and values:
- RSUs: 168,447 (grant-date fair value $2,050,000) on 3/12/2024; Supplemental RSUs: 322,834 ($2,049,996) on 9/24/2024 .
- PSUs (target): 246,018 shares (threshold 123,009; max 492,036) with grant-date fair value $2,888,251 on 5/21/2024 .
- Aggregate 2024 equity grant-date fair value: $6,988,247 .
Equity Ownership & Alignment
- Beneficial ownership (3/31/2025): 201,400 shares consisting of 165,605 directly and 35,795 RSUs vesting within 60 days; <1% of shares outstanding (152,512,805) .
- Outstanding unvested awards at 12/31/2024 (and market values at $6.04/share):
- RSUs: 35,795 (4/18/2022) $216,202; 70,299 (3/17/2023) $424,606; 168,447 (3/12/2024) $1,017,420; 322,834 (9/24/2024, supplemental) $1,949,917 .
- PSUs (threshold counts shown): 80,537 (2022) $486,443; 52,724 (2023) $318,453; 123,009 (2024) $742,974; 2022 tranche later certified at 0% .
- Ownership guidelines: CEO must hold stock worth 6x base salary; executives must retain 50% of net shares until compliant. All NEOs were in compliance or on track as of 12/31/2024 .
- Hedging/pledging: Prohibited for directors and officers (no margin, hedges, swaps, collars, exchange funds) .
- Clawback: Dodd-Frank/Nasdaq-compliant recoupment of erroneously awarded incentive compensation upon restatement, regardless of fault .
Employment Terms
- Appointment and role: CEO since April 18, 2022; also served as interim CFO (Jul 1, 2024–Jan 5, 2025) during CFO transition .
- Executive Severance Plan (amended Apr 4, 2024):
- Outside CIC: CEO gets 150% of (base salary + target bonus); COBRA premiums for 18 months; RSUs continue to vest on schedule; PSUs remain outstanding to vest pro rata based on actual performance .
- CIC (double-trigger within 24 months): Cash severance 200% of (base salary + target bonus); 24 months COBRA; RSUs vest in full; earned PSUs vest in full (PSUs earned based on performance to CIC date) .
- Death/disability: RSUs vest in full; PSUs vest at target on a pro-rata basis if before period end (or based on actual performance if after period end) .
- Illustrative potential payments if terminated 12/31/2024:
- With CIC + termination: Cash $3,825,000; COBRA $57,758; RSUs $3,608,145; PSUs $3,095,736; Total $10,586,639 .
- Qualifying termination outside CIC: Cash $2,868,750; COBRA $43,318; RSUs $3,608,145; PSUs $1,797,734; Total $8,317,947 .
- Restrictive covenants: Confidentiality, non-disparagement, non-solicit and non-compete, with a two-year restricted period post-termination .
- Tax gross-ups: None in current change-in-control arrangements (company policy) .
- Deferred compensation: Nonqualified plan adopted May 21, 2024; eligible executives may defer salary/bonus; company provides matching above 401(k) limits; no NEO participation in 2024 .
Board Service & Governance
- Director status: Class III director since 2022; CEO is not independent .
- Board structure: Independent Board Chair (Brad Forth) separate from CEO; the board reviews leadership structure annually .
- Committees: CEO does not sit on board committees; Audit (Alstead chair), Human Capital (Ashford chair), Nominating & Governance (Forth chair) are 100% independent .
- Attendance: All directors attended ≥75% of board/committee meetings in 2024; all directors attended 2024 annual meeting; non-employee directors meet in executive session each regular meeting .
- Director compensation: CEO receives no additional fees for board service .
Multi-Year CEO Compensation Summary
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | 600,137 | 850,000 | 850,000 |
| Stock awards ($, grant-date fair value) | 3,199,996 | 3,599,995 | 6,988,247 |
| Annual bonus paid ($) | 759,790 | 1,253,750 | 1,009,375 |
| All other comp ($) | 12,200 | 13,200 | 19,385 |
| Total ($) | 5,772,123 | 5,716,945 | 8,867,007 |
Compensation Structure Analysis
- Pay mix: Majority at-risk through annual LIP and multi-year equity; LIP metrics are predominantly quantitative (Adjusted EBITDA, CCC, operational MBOs), with payouts capped; 2024 added a mid-year “Six-Month LIP” and reduced the aggregate cap to 95% to preserve pay-for-performance integrity .
- LTIP rigor: 2022–2024 PSUs paid 0% (no thresholds hit), signaling stringent targets; 2024 PSU design uses revenue and adjusted EPS with RTSR modifier (cap 200%) .
- Market positioning: Target total direct compensation calibrated around the 50th percentile of peers; peer group updated for size/fit each year with Pay Governance’s input .
- Governance safeguards: No hedging/pledging; clawback policy; no option repricing; no tax gross-ups .
Equity Vesting & Potential Selling Pressure
- Scheduled RSU vesting includes:
- 2024 annual RSUs (168,447) vest 1/3 annually in 2025–2027 .
- 2024 supplemental RSUs (322,834) vest 66 2/3% on 9/24/2026 and 33 1/3% on 9/24/2027, creating sizable vesting events in 2026–2027 .
- Prior RSUs from 2022 (35,795) and 2023 (70,299) continue 3-year schedules .
- PSUs from 2023 and 2024 remain outstanding for performance periods through 2025 and 2026, respectively .
Performance & Track Record Highlights
- Pay-versus-performance: In 2024, revenue declined 42% and net income fell to a $240.4M loss; compensation actually paid to the CEO and other NEOs declined accordingly, reflecting equity-based alignment with TSR and financial outcomes .
- 2024 execution: Missed Adjusted EBITDA threshold; delivered best-in-scale CCC (66 days), exceeded cash and LSOW targets in 2H, resulting in capped 95% payout of target under the rebalanced LIP .
Investment Implications
- Alignment strong, but vesting overhang: Large 2026–2027 supplemental RSU vesting tranches may create episodic selling pressure; PSU rigor (0% for 2022–2024 cycle) suggests meaningful upside leverage only with sustained revenue/EPS improvement and relative TSR outperformance .
- Retention vs. dilution trade-off: The September 2024 retention grant backstops leadership continuity through 2027; combined with “continue-to-vest” RSU features on non-CIC terminations, this reduces near-term attrition risk but extends dilution tail .
- Downside protections are conventional: Double-trigger CIC at 2x salary+target bonus; no gross-ups; strict anti-hedging/pledging and clawback reduce governance risk .
- Governance structure mitigates dual-role concerns: Independent chair and fully independent committees provide oversight while the CEO serves as a non-independent director .
- Near-term catalysts: Achieving 2024–2026 PSU revenue/EPS targets and improving TSR vs the peer set (Enphase, SolarEdge, Shoals, FTC Solar) would unlock PSU value; sustained CCC improvements and gross margin stability (as tracked in 2H 2024 LIP) are incremental signals for execution momentum .