Tad Weed
COGENT COMMUNICATIONS HOLDINGSAbout Tad Weed
Tad Weed, age 64, is Chief Financial Officer and Treasurer of Cogent Communications (CCOI). He joined Cogent in 2000, served as CFO from 2004–March 2020, led Audit & Operations during 2020–2022, and was reappointed CFO in 2022, bringing prior senior finance experience at Transaction Network Services and Arthur Andersen . Under the current leadership team, Cogent executed the Sprint network integration, exceeded synergy targets with ~$217 million annual cost savings in 2024, and expanded into optical wavelength and data center services—initiatives that are central to EBITDA and free cash flow growth priorities in the executive pay program . Cogent’s long-run alignment claims are supported by its pay mix and multi-year vesting; company TSR outperformed its telecom index over longer horizons, albeit lagging the S&P 500 over the latest 5-year period ended 12/31/2024 (company TSR index 151.75 vs S&P 197.02) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Cogent Communications | VP & Controller | 2000–2004 | Built financial controls and reporting foundation during early scale-up |
| Cogent Communications | CFO & Treasurer | 2004–Mar 2020; reappointed 2022–present | Led finance through growth, capital returns, and Sprint asset integration (current) |
| Cogent Communications | SVP, Audit & Operations | May 2020–May 2022 | Oversaw audit/ops during leadership transition prior to CFO reappointment |
| Transaction Network Services, Inc. | SVP Finance & Treasurer | 1997–1999 | Broad corporate finance leadership at public telecom services company |
| Arthur Andersen LLP | Senior Audit Manager | 1987–1997 | Led audits for large corporate clients; technical accounting depth |
External Roles
No outside public company board roles or external directorships are disclosed for Mr. Weed in the proxy’s executive officer biographies .
Fixed Compensation
- Policy: Executives (other than CEO and CRO) are generally not eligible for annual cash bonuses; 2024 base salaries rose 4% in line with all employees .
- Mr. Weed’s reported compensation (Summary Compensation Table):
| Metric (USD) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | $335,551 | $348,973 | $361,187 |
| Bonus | $0 | $0 | $15,000 |
| Non-Equity Incentive Plan Compensation | — | — | — |
| All Other Compensation (401k match, etc.) | $3,608 | $6,100 | $6,100 |
| Stock Awards (Grant-Date Value) | $1,508,940 | $1,977,595 | $4,093,163 |
| Total | $1,848,099 | $2,332,668 | $4,460,450 |
Notes:
- The 2024 $15,000 “Bonus” is disclosed in the SCT; the program generally does not provide annual bonuses for the CFO, suggesting this is discretionary or specific-purpose and not part of a recurring plan .
Performance Compensation
- Long-term incentives are the dominant component; Cogent delivers multi-year restricted stock with three-year minimum vesting; for NEOs other than the CEO, 2024 performance-based awards are tied to customer satisfaction (Net Promoter Score) over a multi-year period, evaluated by the Board .
2024 equity grants (CFO):
| Award Type | Shares | Grant-Date Value | Metric/Terms | Vesting |
|---|---|---|---|---|
| Time-based RS (annual) | 19,400 | $1,463,730 | Service | Quarterly in 2027 (Mar 1, Jun 1, Sep 1, Dec 1) |
| Performance-based RS | 4,850 | $365,933 | Customer satisfaction (NPS) over 4/1/2024–11/1/2027; Board-evaluated | Eligible to vest 12/1/2027 |
| Time-based RS (retention) | 30,000 | $2,263,500 | Retention | Vests 1/3/2027 (must be employed on vest date) |
2025 equity grants (CFO):
| Award Type | Shares | Terms | Vesting |
|---|---|---|---|
| Time-based RS | 19,400 | Annual LTI | Vests in 2028 |
| Performance-based RS | 4,850 | Company performance through 2028 | Eligible to vest in 2028 |
Performance plan details (CFO):
| Metric | Weighting | Target | Actual/Payout | Performance Period | Vesting |
|---|---|---|---|---|---|
| Customer satisfaction (NPS), 2024 PBRSU | 100% of PBRSU | Not disclosed (Board-determined) | Not yet determined | 4/1/2024–11/1/2027 | 12/1/2027 |
| Company performance, 2025 PBRSU | 100% of PBRSU | Not disclosed (through 2028) | Not yet determined | Through 2028 | 2028 |
Program guardrails:
- Clawback policy adopted 10/2/2023 (SEC/Nasdaq-compliant)
- No options repricing without shareholder approval; 3-year minimum vesting constraints; dividend equivalents only upon vesting .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 107,900 shares (as of 2/28/2025) |
| Vested vs unvested | 107,800 shares not yet vested (as of 2/28/2025) |
| Ownership as % of outstanding | ~0.22% (107,900 / 49,380,408 outstanding as of 3/13/2025) |
| Options | None disclosed; equity is primarily restricted stock |
| Pledging/Hedging | Company prohibits hedging and nonrecourse pledging; pledging only with full recourse and Audit Committee approval. No pledging by Mr. Weed is disclosed (policy and CEO example discussed) |
| Ownership guidelines | Formal stock ownership guidelines apply to CEO and directors; no specific CFO guideline disclosed |
Vesting calendar (potential selling pressure):
| Date | Shares | Type | Notes |
|---|---|---|---|
| 1/3/2027 | 30,000 | Time-based (retention) | Single-date vest; employment condition |
| 2027 (Mar 1, Jun 1, Sep 1, Dec 1) | 19,400 (in 4 tranches) | Time-based | Quarterly installments in 2027 |
| 12/1/2027 | 4,850 | Performance-based | Customer satisfaction metric; Board evaluation |
| 2028 | 19,400 | Time-based | Annual 2025 grant vests in 2028 |
| 2028 | 4,850 | Performance-based | Based on performance through 2028 |
Employment Terms
| Provision | Terms (CFO) |
|---|---|
| Employment agreement | Yes; CFO & Treasurer |
| Severance (termination without cause or resignation for Good Reason) | 12 months base salary + 12 months benefits; continued vesting of RS during severance period |
| Change in Control (single-trigger equity) | Full vesting of restricted stock upon change in control, subject to cap: immediate vesting value not to exceed 3x annual compensation |
| Change in Control + termination (double-trigger economics) | 100% of then-restricted stock vests immediately + severance paid as lump sum |
| Death/Disability/Retirement | Full vesting of restricted stock |
| Non-compete/confidentiality | Agreements prohibit engaging in competition and disclosure of confidential information |
| “Good Reason” | Substantial adverse change in duties, salary reduction, or relocation outside Washington, DC area |
Estimated payout values (12/31/2024, disclosure basis):
| Scenario | Cash | Equity (accelerated/continued) | Total |
|---|---|---|---|
| Termination without cause | $361,187 | $1,984,883 | $2,346,070 |
| Resignation for Good Reason | $361,187 | $1,984,883 | $2,346,070 |
| Change in control (single-trigger) | $0 | $4,674,296 (cap applies) | $4,674,296 |
| Death/Disability/Retirement | $0 | $4,674,296 | $4,674,296 |
| Termination without cause upon change of control | $361,187 | $4,674,296 | $5,035,483 |
Compensation Structure Analysis
- Mix shift and retention tilt: Mr. Weed’s 2024 equity roughly doubled vs 2023 ($4.09M vs $1.98M) with a sizable 30,000-share retention grant vesting in January 2027—clear emphasis on retention through Sprint asset integration .
- Performance metrics quality: For NEOs (other than CEO), 2024 PBRSUs are tied to customer satisfaction (NPS), a leading indicator but less directly financial (vs EBITDA/FCF used for CEO), introducing some subjectivity (Board-determined targets and payouts) .
- Governance safeguards: SEC/Nasdaq-compliant clawback, no option repricing, strict vesting minimums, no excise tax gross-ups; however, single-trigger CIC equity vesting for NEOs (capped at 3x annual comp) may be investor-sensitive vs best-practice double-trigger .
Say-on-Pay, Peer Group, and Shareholder Feedback
- Say-on-Pay 2024 vote: FOR 40,789,535; AGAINST 1,752,428; ABSTAIN 324,389; 2,279,763 broker non-votes—strong support (~96% of votes cast) .
- Compensation peer group (used for 2024 pay decisions) included names like Calix, EchoStar, Extreme Networks, Guidewire, Nutanix, RingCentral, Viasat; peer set selected on revenue ($585M–$2.34B) and market cap ($915M–$9.15B) ranges at the time .
Performance & Track Record (Context)
- 2024 integration and cost synergy delivery: ~$217M annual cost savings ahead of schedule; expanded optical wavelength footprint; repurposed Sprint facilities for data center monetization .
- Capital returns: Sequential quarterly dividend increases to $0.995 in Q4 2024; strong track record of dividends and repurchases since 2012/2005 respectively .
- TSR context: 5-year TSR through 12/31/2024 at 151.75 vs S&P 197.02 and Nasdaq Telecom Index 103.21; long-term (19-year) TSR outperformance vs telecom peers noted in proxy .
Risk Indicators & Red Flags
- Single-trigger CIC equity acceleration for NEOs (subject to 3x value cap) versus investor-preferred double-trigger; potential pay-for-exit concern in sale scenarios .
- Large 2027 vesting “wall” (30,000 retention + 19,400 time-based + 4,850 performance-based) may create selling pressure windows unless managed via 10b5-1 plans; aligns retention through integration completion .
- Positive mitigants: Clawback policy in place; no hedging; tightly controlled pledging; no tax gross-ups; no option repricing; minimum 3-year vesting standard .
Investment Implications
- Alignment: High equity mix with multi-year vesting and retention grants aligns Mr. Weed to medium-term cash flow and integration milestones; however, the CFO’s performance equity linkage (customer satisfaction) is less directly tied to financial KPIs versus CEO’s EBITDA/FCF, modestly diluting strict pay-for-financial-performance linkage .
- Retention and execution: The 2027 vesting stack is a strong retention mechanic through the post-integration optimization period; loss of the CFO before these milestones could add operational risk given the breadth of finance and integration responsibilities .
- Event risk: Single-trigger CIC equity vesting could increase realized pay in a sale, but the 3x value cap contains extremes; investors typically prefer double-trigger—monitor governance dialogue and future plan amendments .
- Trading signals: Be mindful of vest cliffs in January/quarterly 2027 and 2028 that can drive mechanical supply; watch for 10b5-1 filings and any Form 4 activity around these dates for incremental signals (no pledging by Mr. Weed disclosed) .