Cory J. Reed
DEERE &About Cory J. Reed
Cory J. Reed is President, Worldwide Agriculture & Turf Division, Production & Precision Ag, Sales and Marketing Regions of the Americas and Australia, a role he has held since 2020; he joined Deere in 1998 and previously led John Deere Financial and the Intelligent Solutions Group, shaping precision agriculture strategy . Reed holds a B.S. in Finance from Miami University and a J.D. from The Ohio State University . Company performance during his recent tenure included fiscal 2024 net sales of $51.72B, net income of $7.10B and EPS of $25.62, with OROA 35.9%, OROS 18.2%, ROE 9.6%, and multi‑year TSR outperformance versus the S&P 500 and peer medians .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Deere & Company – Worldwide Agriculture & Turf Division | President, Americas & Australia; Global Harvesting & Turf Platforms; Agricultural Solutions | 2019–2020 | Led regional and platform portfolios ahead of current PPA leadership |
| John Deere Financial | President | 2016–2019 | Ran captive finance; supported equipment sales and customer financing |
| Deere – Intelligent Solutions Group | Senior Vice President | 2013–2016 | Drove precision agriculture strategy and digital solutions |
| Deere – Global Marketing Services | Senior Vice President | 2012–2013 | Led global marketing operations |
| Deere – International (Switzerland); Large Tractors | Regional Sales & Marketing; Marketing Manager | Not disclosed | Early commercial leadership across geographies and product lines |
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary ($) | $917,880 | $954,600 |
| Target STI (% of salary) | 100% | 100% |
| Actual STI Paid ($) | $1,691,498 | $1,712,772 |
Performance Compensation
Short-Term Incentive (STI) Structure and Results
- Weighting: OROA 50%, OROS 40%, ROE 10% .
- FY 2024 Results: OROA 35.9%, OROS 18.2%, ROE 9.6%; payout 180% of target .
- Vesting: Paid in cash; no deferral unless elected under the Deferred Plan .
| STI Metric | Weighting | FY 2024 Target/Goal Context | FY 2024 Actual | Payout |
|---|---|---|---|---|
| OROA (Equipment Operations) | 50% | Formulaic by cycle; rigorous ranges (mid-cycle targets increased over time) | 35.9% | 180.0% of target (aggregate) |
| OROS (Equipment Operations) | 40% | Formulaic by cycle; added in 2022 | 18.2% | 180.0% of target (aggregate) |
| ROE (Financial Services) | 10% | Weighted by subsidized vs. non-subsidized mix | 9.6% | 180.0% of target (aggregate) |
Long-Term Incentive Cash (LTIC) – Performance Period Ended FY 2024 (2012–2024 tranche)
| LTIC Metric | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|
| 3-Year Accumulated SVA ($mm) | $5 | $5,770 | $11,540 | $20,920 | 200.0% |
| rTSR Modifier (vs. peers) | 75%=125% | 50%=100% | 25%=75% | 54th percentile (TSR 24.01%) | N/A due to cap |
| Reed’s LTIC Award ($) | — | — | — | — | $1,998,234 |
Long-Term Equity (LTI) Awards – Fiscal 2024 Grants (granted Dec 13, 2023)
| Instrument | Performance Metrics | Grant Date | Number | Terms | Grant Date Fair Value ($) |
|---|---|---|---|---|---|
| PSUs | 50% relative TSR, 50% relative revenue growth (equal weights) | 12/13/2023 | Target 5,490; Threshold 1,372; Max 10,980 | 3-year cliff vest; Payout 0–200% | $2,007,666 |
| RSUs | Stock price appreciation | 12/13/2023 | 2,745 | 34%/33%/33% annual vest over 3 years | $1,034,892 |
| Stock Options | Stock price appreciation | 12/13/2023 | 10,554 | 34%/33%/33% annual vest; 10-year term; strike $377.01 | $1,034,714 |
PSU Payouts – Performance Period Ended FY 2024 (2022–2024 tranche)
| PSU Metric | Payout Curve | Actual Performance | Payout |
|---|---|---|---|
| Relative Revenue Growth vs. peers | 25th=25%, 50th=100%, 75th=200% | 42nd percentile | 76.0% of target |
Prior PSU Payouts – Performance Period Ended FY 2023 (2021–2023 tranche)
| PSU Metric | Actual Performance | Payout |
|---|---|---|
| Relative Revenue Growth vs. peers | 92nd percentile | 200% of target |
Equity Ownership & Alignment
| Ownership Item | Detail |
|---|---|
| Beneficial Ownership (a) | 15,087 shares; plus 48,412 exercisable options; total 63,499; less than 1% of shares outstanding |
| Outstanding Equity (unvested) | 18,871 unexercisable options; 5,531 RSUs (market value $2,256,261 at $407.93); 1,902 PSUs estimated (market value $775,883) |
| Ownership Guidelines | NEOs must hold stock equivalent to 3.5× base salary; all NEOs have achieved or are within 5-year compliance window |
| Hedging/Pledging | Prohibited for directors and executives (anti-hedging and anti-pledging policies) |
(a) Company-wide table shows Reed’s beneficial ownership and options exercisable within 60 days; percentage marked “*Less than 1%” for all listed individuals .
Employment Terms
- Employment Agreements: Deere does not offer employment agreements to U.S.-based executives; no excise tax gross-ups on change in control .
- Severance (non-CIC): Company severance guidelines provide up to one year’s salary based on service; termination scenarios and quantified estimates disclosed (e.g., termination without cause totals $12,345,673 for Reed at fiscal 2024 year-end) .
- Change-in-Control (CIC): Double trigger; for senior officers, lump-sum 2× base salary + 2× target STI; welfare benefit continuation; defined contribution plan cash payment; equity acceleration/cash-out (RSUs cash, PSUs cashed at target); Reed’s estimated total under CIC+qualifying termination: $12,818,694 .
- Restrictive Covenants: CIC program includes restrictive covenants (e.g., non-compete), confidentiality and employee non-solicit for two years post-termination .
- Clawback: Incentive Compensation Recovery Policy compliant with SEC/NYSE, requiring recoupment on restatements .
Compensation Structure Analysis
- Mix and Risk: Reed’s fiscal 2024 compensation includes base ($954.6K), STI ($1.71M), LTIC ($1.998M), and equity grants (PSUs/RSUs/options totaling ~$4.08M at grant); the program emphasizes “at-risk” pay with performance‑based STI and PSUs aligned to OROA/OROS/ROE and relative TSR/revenue growth .
- Metric Rigor and Evolution: OROA/OROS goals are formulaically set by cycle position and have increased materially versus 2015; 2025 STI goals further tightened to align with Leap Ambitions (mid‑cycle OROS 20%) .
- Equity Shift: LTIC discontinued for new periods in fiscal 2024; LTI equity tilted to 50% PSUs with added relative TSR metric, increasing performance sensitivity .
Perquisites, Deferred Comp, and Pension
- Perquisites: Minimal; 2024 “All Other Compensation” for Reed was $271,173, including perquisites ($6,869) and defined contribution plan contributions ($264,304); no personal aircraft usage .
- Deferred Compensation: 2024 executive deferrals of $360,444 (Deferred Plan) and $138,782 (DCRP); aggregate balance $4,874,690; plan returns linked to S&P 500 index options; distributions per plan terms .
- Pension: Present value of accumulated benefit $2,420,761 across qualified and nonqualified plans (Salaried, Senior Supplementary, Deere Supplemental) .
Track Record, Execution, and Governance Signals
- Strategic Leadership: Reed led the Intelligent Solutions Group and precision agriculture strategy before becoming President of John Deere Financial and later President PPA .
- Company Performance: FY 2023 saw net sales $61.25B, net income $10.17B, and SVA $9.32B; equipment operations OROA 52.46% and OROS 21.89% supported strong STI and LTIC payouts (185.7% STI; 200% LTIC) .
- Shareholder Support: Say‑on‑pay approvals ~92.4% in 2024 and 92.5% in 2023 indicate broad investor alignment with compensation design .
Investment Implications
- Alignment: High proportion of performance‑based incentives (STI, PSUs) tied to rigorous OROA/OROS/ROE and relative TSR/revenue growth supports pay‑for‑performance and shareholder alignment; anti‑hedging/pledging and ownership requirements strengthen alignment .
- Vesting and Selling Pressure: Ratable RSU and option vesting schedules and 3‑year PSU cliffs imply periodic settlement events (e.g., Reed’s Dec 13 grants), but policy prohibits pledging and requires ownership multiple compliance, moderating forced selling risk .
- Retention and Change‑in‑Control Economics: Double‑trigger CIC with 2× cash severance plus equity treatment offers competitive protection without gross‑ups; robust pension and deferred comp balances provide retention but add to separation value .
- Performance Sensitivity: The shift to 50% PSUs with relative TSR increases multi‑year market‑linked variability; recent PSU payout at 76% (2022–2024) reflects tougher relative revenue growth conditions vs. prior cycles, tempering realized equity compensation and signaling tighter performance gating .