Ian Hudson
FEDERAL SIGNAL CORP /DE/About Ian Hudson
Ian A. Hudson is Senior Vice President and Chief Financial Officer of Federal Signal Corporation, appointed in October 2017; he joined FSS in August 2013 as Vice President and Corporate Controller after roles at Groupon (Director of Accounting – Latin America and Asia Pacific) and Ernst & Young (Senior Audit Manager). He is 48 years old as of February 1, 2025 . Company performance under the current leadership delivered record 2024 results: net sales $1.86B (+8% Y/Y), adjusted EBITDA $350.6M (+23% Y/Y; 18.8% margin), EPS $3.50 (+37% Y/Y), and year-end backlog $997M . Over the five-year period to 2024, a $100 investment in FSS grew to $299 versus $226 for the S&P 600 Capital Goods peer index, underscoring strong TSR delivery .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Federal Signal | SVP & CFO | Oct 2017–present | Principal financial officer; Section 302/404 oversight and certifications |
| Federal Signal | VP & Corporate Controller | Aug 2013–Oct 2017 | Corporate controllership and reporting leadership |
| Groupon | Director of Accounting – LATAM & APAC | 2012–2013 | Regional accounting leadership across international operations |
| Ernst & Young | Senior Audit Manager | 1998–2012 | Audit and financial reporting expertise |
External Roles
No public company directorships or external board roles are disclosed for Hudson in FSS filings .
Fixed Compensation
Multi-year compensation (as reported in the Summary Compensation Table):
| Metric (USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary paid | $463,542 | $478,931 | $493,299 |
| Stock awards (grant-date fair value) | $543,723 | $581,235 | $637,554 |
| Option awards (grant-date fair value) | $181,270 | $193,758 | $212,443 |
| Non-equity incentive (STIP cash) | $415,479 | $673,775 | $693,988 |
| Change in pension value/Deferred comp earnings | $0 | $0 | $0 |
| All other compensation | $67,769 | $80,453 | $95,412 |
| Total | $1,671,783 | $2,008,152 | $2,132,696 |
Additional 2024 fixed pay details:
- Base salary rate: $495,706 (vs. $481,268 in 2023) .
- Perquisites/other: auto allowance $11,400; 401(k) contributions $13,800; Savings Restoration Plan contributions $63,817; dividend income on unvested restricted stock $5,644; life insurance $751; total “All Other Compensation” $95,412 .
Performance Compensation
Short-Term Incentive Plan (STIP) design and 2024 outcomes:
- Target bonus: 70% of salary; payout capped at 200% of target .
- Weighting: Earnings (60%); Adjusted EBITDA margin (20%); Individual objectives (20%) .
- Company financial goal grid and actuals for 2024:
• Adjusted income before income taxes: Threshold $208.3M; Target $231.4M; Max $254.5M; Actual $271.8M .
• Adjusted EBITDA Margin: Threshold 15.3%; Target 16.8%; Max 17.8%; Actual 18.8% . - 2024 payout: Company financial component at 200% of target; individual component at maximum; Hudson earned 200% of total target ($693,988) .
| STIP Metric (2024) | Threshold | Target | Maximum | Actual |
|---|---|---|---|---|
| Adjusted income before income taxes ($M) | 208.3 | 231.4 | 254.5 | 271.8 |
| Adjusted EBITDA margin (%) | 15.3% | 16.8% | 17.8% | 18.8% |
Long-Term Incentive Plan (LTIP) structure:
- Mix: PSUs 50%; Stock Options 25%; Restricted Stock 25% .
- PSU metrics and vesting: 3-year performance; 75% EPS from continuing operations; 25% ROIC; TSR modifier ±20% vs. S&P 600 Capital Goods Index; payouts 0–240% of target; earned shares vest at end of performance period .
- Options: 10-year term; vest ratably over 3 years; 2024 strike $82.31 .
- Restricted Stock: 3-year cliff vest .
2024 grants to Hudson:
| Grant type | Units/Options | Key terms | Grant-date fair value |
|---|---|---|---|
| PSUs (target) | 4,952 | 3-year period ending 12/31/2026; EPS/ROIC with TSR ±20% | $425,030 |
| Restricted Stock | 2,582 shares | Cliff vests on 3rd anniversary of 5/2/2024 grant | $212,524 |
| Stock Options | 7,263 options @ $82.31 strike | Vest 1/3 annually over 3 years; 10-year term | $212,443 |
Recent PSU performance realization:
- PSUs granted in 2022 earned at 228% of target (190% on financials, +20% TSR top-quartile modifier); shares were issued in Q1 2025 to those employed on 12/31/2024 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 116,047 shares (as of Feb 24, 2025) |
| Options exercisable within 60 days | 29,018 (included in beneficial ownership) |
| Recently issued PSU shares | 12,260 shares from 2022 PSUs issued net of withholding in late Feb 2025 (included in totals) |
| Unvested restricted stock (12/31/24) | 2,582 shares |
| Outstanding PSUs (unearned, max assumption) | 11,885 shares at 240% maximum assumption as disclosed |
| Ownership guidelines | CFO must hold 3x base salary; as of 12/31/24, Hudson exceeded target ownership |
| Holding requirements | After meeting target, must retain at least 50% of net shares from vesting/exercise for 2 years |
| Hedging/pledging | Company policy prohibits hedging, short sales, margin accounts, and pledging of Company stock |
Note on ownership scale: Hudson’s 116,047 shares vs. 61,097,138 shares outstanding at the 2025 record date equates to ~0.19% of outstanding (116,047/61,097,138) .
Insider selling pressure indicators:
- Near-term supply is mitigated by mandatory holding requirements (retain 50% of net shares for two years once guideline met) and a formal prohibition on pledging/hedging .
- 2022 PSUs vested 12/31/2024 and were issued in Q1’25; policy still imposes two-year holding on a portion of vested shares, tempering sales pressure .
Employment Terms
General severance and restrictive covenants:
- Executive General Severance Plan (involuntary termination without Cause or resignation for Good Reason): cash equal to base salary plus target bonus (tiered by level), pro-rata current-year bonus, continuation of health and welfare benefits (duration by tier), vested options exercisable for 3 months; non-compete and non-solicit covenants for 12 months; release required .
- Change-in-Control (CiC) agreements (double-trigger): lump sum up to 2x (base + target bonus) plus an additional 1x (base + target bonus) for agreeing to an 18-month non-compete; immediate vesting of equity awards; up to 36 months of medical and 12 months of other benefits; no excise tax gross-up for executives other than the CEO .
Hudson—illustrative severance economics (assumes termination on 12/31/2024):
| Scenario | Cash severance | Pro-rata bonus | Equity acceleration/value | Benefits/other | Total |
|---|---|---|---|---|---|
| Involuntary w/o Cause or for Good Reason | $842,700 | $346,994 | Options $0; RS $0; PSUs $0 (unvested forfeited) | Med $21,995; Dental $267; Life $751 | $1,212,707 |
| Death | — | $346,994 | Options $644,247; RS $1,051,675; PSUs $593,452 | — | $2,636,368 |
| Disability | — | $346,994 | Options $644,247; RS $1,051,675; PSUs $593,452 | — | $2,636,368 |
| CiC only | — | — | Options $644,247; RS $1,051,675; PSUs $1,118,935 (accelerated) | — | $2,814,857 |
| CiC + termination w/o Cause or for Good Reason | $2,519,673 (cap 2.99x salary+bonus) | $346,994 | Options $644,247; RS $1,051,675; PSUs $1,118,935 | Med $65,985; Dental $267; Life $751 | $5,748,527 |
Other terms:
- Clawback: Company must recover excess incentive-based compensation upon an accounting restatement per Rule 10D-1/NYSE standards .
- No tax gross-ups: Policy prohibits tax gross-ups for NEOs (except a grandfathered CEO agreement); CiC text confirms no gross-up for other executives .
Compensation Structure Analysis
- Pay-for-performance: STIP paid at maximum on both financial metrics (earnings, EBITDA margin) given 2024 outperformance; PSUs emphasize multi-year EPS/ROIC with a relative TSR modifier (+/−20%) to align with shareholder returns .
- At-risk mix: For non-CEO NEOs (including CFO), a substantial share of target comp is variable; equity is a significant portion of total pay (Hudson: 39.9% of 2024 total compensation in equity vehicles) .
- Ownership alignment: CFO exceeds 3x base salary ownership requirement; post-vesting two-year hold and hedging/pledging prohibitions enhance alignment and reduce short-term selling incentives .
- Market benchmarking: Meridian as independent consultant; peer group includes Alamo Group, IDEX, SPX Technologies, Terex, Toro, etc. .
- Shareholder support: 2024 say-on-pay received ~96% approval, indicating strong investor endorsement of pay practices .
Additional Data Points
- Deferred compensation (Savings Restoration Plan): 2024 executive contributions $74,635; company contributions $63,817; year-end balance $1,141,275 .
- Equity vesting/exercises (2024): No option exercises; stock vested 26,176 shares valued at $2,384,961 for Hudson (PSUs and prior RS) .
Investment Implications
- Strong alignment and retention: Multi-year PSUs with EPS/ROIC/TSR, sizable unvested equity (RS and PSUs), and ownership/holding requirements suggest moderate near-term selling pressure and good retention incentives for the CFO .
- Balanced severance/CiC economics: Double-trigger CiC with up to 2x plus 1x non-compete consideration (and 2.99x cap) provides continuity without shareholder-unfriendly gross-ups, limiting parachute risk for non-CEO NEOs .
- Execution track record: 2024 record financials and top-quartile TSR in the 2022 PSU cohort (leading to 228% payout) indicate effective financial stewardship during Hudson’s tenure; continued use of earnings/EBITDA margin in STIP ties cash pay to near-term performance .
- Governance and risk: Clawback policy and prohibition on hedging/pledging reduce misalignment risks; absence of related-party transactions in 2024 is a clean governance signal .