David A. Gardella
Donnelley Financial SolutionsAbout David A. Gardella
David A. Gardella is Executive Vice President and Chief Financial Officer of Donnelley Financial Solutions (DFIN) since 2016, after senior finance, investor relations, and M&A roles at RR Donnelley (RRD) from 1992–2016 . He is 54 years old per the latest executive officer disclosure and has served as DFIN’s CFO since the spin-off, overseeing a transformation toward software-centric revenues; in 2024 software solutions net sales reached $329.7 million and became the largest revenue component . Under his tenure, DFIN’s 2024 net sales were $781.9 million, Non-GAAP Adjusted EBITDA was $217.3 million, and the company’s cumulative TSR turned an initial $100 to $599.14 by 2024, indicating strong value creation through mix shift and cost discipline .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| RR Donnelley (RRD) | Senior Vice President, Investor Relations & M&A | 2011–2016 | Led investor communications and transactions; foundation for DFIN capital markets readiness |
| RRD | Vice President, Investor Relations | 2009–2011 | Managed IR during cycle transitions |
| RRD | Vice President, Corporate Finance | 2008–2009 | Corporate finance leadership |
| RRD | Financial management and FP&A roles | 1992–2004; 2005–2008 | Broad finance/FP&A experience across business units |
External Roles
- No public company directorships or external roles disclosed for Gardella .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $450,000 | $470,000 | $485,000 |
| Target Annual Incentive (% of Salary) | 100% | 100% | 100% |
| Actual AIP Paid ($) | $998,842 | $530,630 | $663,480 |
| Stock Awards (Grant-Date Fair Value, $) | $1,371,968 | $1,979,003 | $2,659,179 |
| All Other Compensation ($) | $9,150 | $9,900 | $10,350 |
| Total Compensation ($) | $2,829,960 | $2,989,533 | $3,818,009 |
Performance Compensation
2024 Annual Incentive Plan (AIP) Design and Outcomes
| Metric | Weight | Threshold | Target | Maximum | Actual | Payout % |
|---|---|---|---|---|---|---|
| Consolidated Non-GAAP Adjusted EBITDA ($mm) | 50% | $170.8 | $213.5 | $256.2 | $217.3 | 111.1% |
| Consolidated Software Solutions Net Sales Growth (%) | 30% | 5.0% | 10.0% | 15.0% | 14.2% | 204.1% |
| Strategic Corporate Initiatives (5 goals) | 20% | — | — | 100% | Achieved all five goals | 100.0% |
| Individual Performance Factor | ±25% | — | — | — | No adjustment | 100.0% |
| Weighted Total Payout | — | — | — | — | — | 136.8% |
| Gardella AIP Paid ($) | — | — | $485,000 | — | — | $663,480 |
Key 2024 AIP metrics emphasize EBITDA and software growth; five strategic initiatives (operational transformation, TAM expansion, product enhancements, Zero Trust IT, diversity goals) were fully met .
Long-Term Incentive (LTI) 2024 Grants and Structure
| Element | Gardella Grant Detail | Vesting/Performance Design |
|---|---|---|
| PSUs (target shares and value) | 25,295 target PSUs; grant-date FV $1,842,741 | 50% recurring/reoccurring revenue: three annual measures (2024–2026, 20% each) + cumulative 3-year (40%); 50% free cash flow conversion cumulative 2024–2026; payout 50–200% of target, TSR modifier ±25% vs S&P 600 |
| RSUs (shares and value) | 12,459 RSUs; grant-date FV $816,438 | Ratable vesting one-third annually over 3 years |
Interim certifications:
- 2024 PSUs: 66.4% earned for the 2024 recurring/reoccurring revenue tranche (subject to time-based vesting and TSR modifier at end of 2026) .
- 2023 PSU award: 2024 performance period earned 94.3% based on $329.7m software net sales and 27.8% Adjusted EBITDA margin (subject to time-based vesting) .
Historical PSU outcome:
| PSU Grant Year | Metric Framework | Gardella Target PSUs | Payout % | Shares Earned |
|---|---|---|---|---|
| 2022 | Software net sales and Adjusted EBITDA margin (’22, ’23, ’24; plus cumulative) | 29,600 | 124.9% | 36,977 |
Equity Ownership & Alignment
| Category | Detail |
|---|---|
| Beneficial Ownership | 171,367 shares; less than 1% of outstanding; 28,530,105 shares outstanding as of Mar 17, 2025 |
| Stock Ownership Guidelines | CFO required ≥3x base salary; executives met or exceeded as of Mar 15, 2025; must hold 50% of vested shares until guideline met |
| Vested vs. Unvested (as of 12/31/2024) | Unvested RSUs: 47,998; unearned PSUs at target: 38,609 |
| Option Awards Outstanding | 19,300 @ $22.35 exp 3/2/2027; 33,800 @ $17.65 exp 3/2/2028; 22,500 @ $14.15 exp 3/5/2029 |
| Prohibitions | No hedging or pledging allowed under insider trading policy |
| Insider Trading Controls | Pre-clearance required; trading windows; Rule 10b5-1 plans designed to trade in windows |
RSU scheduled vesting:
| Vesting Date | RSUs (Gardella) |
|---|---|
| 3/3/2025 | 10,069 |
| 3/4/2025 | 4,153 |
| 3/3/2026 | 5,202 |
| 3/4/2026 | 4,153 |
| 3/4/2027 | 4,153 |
Option/stock vested and realized:
- 2024 vesting value realized on RSUs/PSUs: $3,355,108 (shares delivered at $47.54 on 3/3/2025) .
Employment Terms
| Topic | CFO Terms |
|---|---|
| Plan | Executive Severance Plan (ESP) |
| Qualifying Termination (no CIC) | 1x base salary + 1x target bonus; pro rata annual bonus at actual achievement; RSUs vest pro rata; PSUs continue pro rata based on actual performance; 12 months health coverage |
| CIC Framework | Double-trigger: at Change in Control, PSUs deemed earned at target and remain subject to time vest; upon Qualifying Termination during CIC period, RSUs and PSUs vest in full; health coverage 18 months |
| Non-Compete/Non-Solicit | Required for 1–2 years post-termination under agreements/ESP |
| Clawback | NYSE Rule 303A.14 compliant clawback policy; recovery of erroneously awarded incentive compensation after restatement |
| Tax Gross-Ups | No 280G/change-of-control tax gross-ups; plan prohibits repricing and requires minimum vesting |
Illustrative potential payments (12/31/2024 hypothetical):
| Scenario | Total Estimated ($) |
|---|---|
| Termination Without Cause (no CIC) | $4,198,519 |
| Resignation for Good Reason/Termination Without Cause after CIC | $7,416,927 |
| Disability | $3,713,365 |
| Death | $3,713,365 |
Compensation Structure and Governance Signals
- Pay mix emphasizes performance: PSUs 67% and RSUs 33% of LTI; strong focus on recurring/reoccurring revenue, FCF conversion, and 3-year relative TSR .
- Compensation governance: independent consultant (Meridian), robust stock ownership guidelines, clawback, no repricing/dividends on unearned awards, no hedging/pledging; say-on-pay passed with ~99.1% approval in 2024 .
- Peer benchmarking: software/data services cohort including BR, FDS, JKHY, WK; peer group updated as constituents were taken private .
Performance & Track Record
- 2024 business highlights: record software solutions net sales ($329.7m, +12.6% YoY) and largest revenue component; net sales $781.9m; strong FCF ($105.2m) and Adjusted EBITDA $217.3m .
- Capital allocation: 0.9 million shares repurchased in 2024 at $61.97 average; $91.3m remaining authorization at year-end .
- Pay versus performance: cumulative TSR value of $599.14 vs $198.41 for peer group index by 2024; Net Income $92.4m; Adjusted EBITDA $217.3m .
Equity Ownership & Alignment Analysis
| Aspect | Assessment |
|---|---|
| Skin-in-the-game | Direct ownership 171,367 shares; plus unvested RSUs/PSUs; overall <1% of shares outstanding but aligned via stock ownership guideline and large at-risk PSU exposure |
| Pledging/Hedging | Prohibited, reducing alignment risk |
| Vested vs Unvested | Significant unvested RSUs and PSUs create long-duration incentive alignment through 2026 with TSR modifier |
| Ownership guideline compliance | Met or exceeded; CFO requirement 3x salary; mandatory 50% hold on vested shares until guideline met |
Employment Terms Details (Severance/CoC Economics)
- Outside CIC: cash severance 1x salary+bonus; pro rata bonus; RSUs pro rata vest; PSUs pro rata to actual performance; 12 months healthcare; no tax gross-ups .
- At CIC: PSUs deemed earned at target and remain time-vested; upon Qualifying Termination in CIC window, all equity vests; 18 months healthcare; double-trigger approach; no single-trigger acceleration at plan level .
Risk Indicators & Red Flags
- No hedging/pledging; clawback in place; no option repricing; no tax gross-ups—positive governance signals .
- Estimate leverage in AIP capped; multi-metric PSU design with TSR modifier mitigates undue risk-taking .
- Section 16 compliance timely for officers/directors in 2024 .
Investment Implications
- High pay-for-performance alignment: PSU focus on recurring/reoccurring revenue and FCF conversion, plus TSR modifier, ties CFO incentives to durable mix shift and cash generation—supportive for margin expansion and quality of earnings .
- Retention risk appears contained: robust ownership guidelines and substantial unvested equity through 2026, plus competitive severance economics with double-trigger vesting reduce abrupt departure risk .
- Limited governance red flags: prohibition on hedging/pledging, clawback, no single-trigger acceleration, and 99.1% say-on-pay support suggest investor-friendly practices and low agency risk .
- Potential selling pressure: scheduled RSU/PSU vesting may create periodic liquidity events, but mandatory holding until guideline met and policy constraints moderate near-term sales impact .