Thomas Baker
About Thomas Baker
Thomas C. Baker, age 59, serves as Senior Vice President, Chief Financial Officer, and Treasurer of PC Connection, Inc. (CNXN). He joined CNXN in March 2019 after serving as Corporate Vice President and CFO for the New Markets and Service Group at Applied Materials, Inc. since 2013 . During 2024, CNXN delivered net income of $87.1 million and cumulative TSR value of 146.02 (based on an initial fixed $100 investment), while net sales declined 1.7% year-over-year to $2,802.1 million; executive cash performance awards tied to net income and SG&A leverage paid out at 96% of target for Baker, reflecting near-target performance on both measures . Baker certified CNXN’s 2024 Form 10-K under Sarbanes-Oxley sections 302 and 906 as principal financial and accounting officer .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Applied Materials, Inc. | Corporate Vice President and CFO, New Markets and Service Group | 2013–2019 | Finance leadership at a semiconductor capital equipment company segment |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | No external public company boards disclosed for Baker in CNXN filings reviewed |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 383,654 | 412,500 | 445,500 (increased to $453,750 effective 3/14/2024) |
| Target Bonus (% of Salary) | 100% (employment agreement) | 100% (employment agreement) | 100% (2024 awards) |
| Bonus ($) | — | — | 2,723 |
| Non-Equity Incentive Plan Compensation ($) | 468,600 | 206,250 | 435,600 |
| Stock Awards – Grant-Date Fair Value ($) | 1,082,600 | 206,250 | 1,284,600 |
| All Other Compensation ($) | 17,026 | 18,364 | 19,365 |
| Total Compensation ($) | 1,951,880 | 637,114 | 2,187,788 |
Performance Compensation
2024 Cash Performance Award Structure and Outcomes
| Metric | Weighting | Target | Actual | Payout (% of Target) | Baker Payout ($) |
|---|---|---|---|---|---|
| Consolidated Net Income | 60% | $90.0M | $87.1M | 96% | Included in $435,600 total |
| SG&A as % of Billings | 40% | 10.14% | 10.54% | 96% | Included in $435,600 total |
| Total (Cash Award) | 100% | — | — | — | $435,600 (96% of base salary) |
Notes:
- Performance multipliers ranged 0.5–1.7 with no payout if net income < $81.0M or SG&A% of billings > 11.15% .
- 2024 executive cash performance awards totaled ~$1.9M across NEOs .
Equity Awards and Vesting
| Grant Date | Award Type | Shares Granted | Grant-Date Fair Value ($) | Vesting Schedule | First Vest Date |
|---|---|---|---|---|---|
| Mar 14, 2024 | RSU | 20,000 | 1,284,600 | 4-year, equal annual installments | Mar 14, 2025 |
| Nov 2022 | RSU | 5,000 | — | 4-year, equal annual installments | Nov 21, 2023 |
| Dec 2021 | RSU | 5,000 | — | 4-year, equal annual installments | Dec 17, 2022 |
| Feb 2021 | RSU | 5,000 | — | 4-year, equal annual installments | Feb 23, 2022 |
Additional equity context:
- No options were exercised in 2024; CNXN currently grants restricted stock units (RSUs) and does not grant options or similar instruments .
RSUs Vested in 2024
| Name | Shares Acquired on Vesting | Value Realized on Vesting ($) |
|---|---|---|
| Thomas Baker | 15,000 | 1,068,600 |
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficial Ownership (Shares) | 42,853 |
| Ownership % of Shares Outstanding | <1% |
| Unvested RSUs (12/31/2024) | 5,000 (Feb 2021; $346,350), 5,000 (Dec 2021; $346,350), 10,000 (Nov 2022; $692,700), 20,000 (Mar 2024; $1,385,400) |
| Stock Ownership Guidelines | None for executives |
| Hedging/Derivatives | Prohibited under Insider Trading Policy |
| Pledging | Prohibited, with rare exception requiring CFO and Audit Committee approvals; no pledging disclosed for Baker |
Unvested RSU fair values above are based on CNXN’s closing price of $69.27 on December 31, 2024 .
Employment Terms
| Term | Detail |
|---|---|
| Employment Agreement | Dated March 1, 2019; CFO eligible for annual cash performance award with incentive target of 100% of base salary and annual equity awards |
| Base Salary Adjustment | Increased to $453,750 effective March 14, 2024 |
| Severance (Non-CIC Termination) | 24 months base salary and prorated target cash award; COBRA continuation coverage costs for 24 months |
| Change-in-Control (CIC) Terms | If terminated without cause or for good reason within 12 months of CIC: full-year target cash payout at 100% of base (non-prorated) and severance; equity acceleration: 75% of unvested portion vests at CIC; remaining unvested portion vests on the earlier of one year post-CIC (if employed) or upon qualifying termination |
| Estimated CIC Payout (as of 12/31/2024) | $3,456,150 total, including $907,500 salary (24 months), $2,078,100 accelerated RSU value, $453,750 target cash award, and $16,800 COBRA |
| Non-Compete/Non-Solicit | 24 months post-termination |
| Clawback Policy | Executives agree to be bound by CNXN’s clawback policy; Compensation Committee oversees clawbacks |
Investment Implications
- Pay-for-performance alignment: Baker’s cash incentive is tied to company-wide net income and SG&A leverage with a 100% of base salary target; 2024 payout at 96% indicates incentives are responsive to operating results (near-target performance on both measures) . Equity compensation via RSUs further aligns long-term interests, with substantial unvested awards outstanding .
- Vesting cadence and potential selling pressure: Baker had 15,000 RSUs vest in 2024, and maintains a pipeline of annual RSU vesting from 2021–2024 grants, which can create predictable supply; however, hedging is prohibited and pledging is tightly restricted, mitigating certain alignment red flags .
- Ownership alignment: Direct ownership is <1% of shares outstanding, but meaningful unvested RSU exposure remains; CNXN has no executive stock ownership guidelines, which may reduce formal ownership requirements compared to peers .
- Change-of-control economics: Equity acceleration terms include 75% single-trigger vesting at CIC with remaining double-trigger or one-year time-based vesting; combined with 24 months’ salary and non-prorated annual target cash award, total estimated CFO CIC benefits of $3.46M could influence retention dynamics around strategic transactions .
- Governance context: CNXN is a controlled company (53.3% voting power held by Patricia Gallup), with a two-member Compensation Committee using independent benchmarking (Pearl Meyer). This structure can affect compensation oversight; nonetheless, clawback oversight and prohibitions on hedging/pledging are in place .
2024 company performance context: Net sales decreased 1.7% to $2,802.1M, gross margin expanded 60 bps to 18.6%, and net income increased to $87.1M; cumulative TSR value reached 146.02, supporting moderate incentive payouts despite top-line pressure .