Thomas Ellman
GATXAbout Thomas Ellman
Thomas A. Ellman is Executive Vice President and Chief Financial Officer of GATX, a role he has held since August 2018; he is 56 years old and previously led GATX Rail North America and held senior commercial and risk roles across GATX and GE Equipment Services . In 2024, GATX delivered net income of $284.2M, diluted EPS of $7.78, ROE of 12.1%, and a total shareholder return over 30%, with compensation plans tied to non-GAAP net income and long-term ROE and investment volume targets to reflect the industry’s cyclicality .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| GATX | EVP & CFO | 2018–present | Stewarded capital allocation and financial policy during multi-year investment cycle; compensation aligned to non-GAAP net income and LTI-adjusted ROE/investment volume |
| GATX | EVP & President, Rail North America | 2013–2018 | Managed North America fleet strategy through market downcycle, setting up rate and term improvements as cycle strengthened |
| GATX | SVP & Chief Commercial Officer | 2011–2013 | Drove portfolio optimization and customer strategy |
| GATX | VP & Chief Commercial Officer | 2006–2011 | Led commercial activities post re-joining GATX |
| GE Equipment Services, Railcar Services | SVP & Chief Risk Officer; SVP Asset Management | pre‑2006 | Risk and asset management experience in rail leasing complements GATX long-lived asset strategies |
External Roles
No public-company directorships or external board roles disclosed for Ellman in GATX filings .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 568,467 | 596,583 | 618,483 |
| Target Bonus (% of Salary) | 70% | 70% | 70% |
| Actual Annual Incentive Paid ($) | 421,284 | 447,133 | 452,507 |
| Stock Awards – Grant Date FV ($) | 995,422 | 619,642 | 700,633 |
| Option Awards – Grant Date FV ($) | 598,044 | 615,900 | 687,388 |
| Change in Pension Value ($) | — | 507,862 | 44,695 |
| All Other Compensation ($) | 9,150 | 9,900 | 15,525 |
| Total Compensation ($) | 2,592,366 | 2,797,020 | 2,519,231 |
Notes:
- 2024 base salaries for NEOs increased 3.5% effective March 1, 2024; Ellman received the standard increase (additional market adjustments applied to selected peers) .
Performance Compensation
Incentive Plan Mechanics and Outcomes
| Incentive | Metric | Weighting | Target | Actual | Payout | Vesting/Payment |
|---|---|---|---|---|---|---|
| Annual Incentive (2024) | Net income, excluding tax adjustments & other items (non-GAAP) | 100% | $271.7M | $288.1M | 104.5% of target | Cash (determined Feb 2025) |
| Performance Shares (2012–2024 plan determination) | 3‑yr avg LTI-adjusted ROE (non-GAAP) | 50% | 10.0% | 9.8% | Contributed to 136.8% overall PS payout | Vested end of 2024; payout based on FMV on Feb 18, 2025 |
| Performance Shares (2012–2024 plan determination) | 3‑yr cumulative investment volume (GAAP) | 50% | $2.73B | $4.60B | Contributed to 136.8% overall PS payout | Vested end of 2024; payout based on FMV on Feb 18, 2025 |
- Ellman’s 2022–2024 performance shares vested and contributed to 2024 stock awards vested value of $1,301,913 (includes RSUs and PSUs) .
Current LTI Design (2024–2026 cohort)
| Element | Grant Date | Quantity/Terms | Strike/Target | Vesting |
|---|---|---|---|---|
| Non‑Qualified Stock Options | Jan 25, 2024 | 15,200 options | $126.47 | Ratable over 3 years; 7‑year term; dividend equivalents accrue and pay after vesting |
| Performance Shares | Jan 25, 2024 | Threshold 1,385; Target 5,540; Max 11,080 | Targets: ROE 10.6%; Investment volume $4.01B (equal weight) | Cliff at 12/31/2026; 0–200% earned based on goals; dividends only on earned shares |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total Beneficial Ownership (Feb 28, 2025) | 130,542 shares |
| Shares Outstanding (Record Date) | 35,675,897 |
| Ownership as % of Outstanding | ~0.37% (130,542 ÷ 35,675,897) |
| Options Exercisable within 60 Days | 86,066 |
| Unexercisable Options Outstanding | 15,200 (2024 grant) @ $126.468; 10,000 (2023) @ $113.28; 5,734 (2019) @ $103.15 |
| RSUs Scheduled to Vest | 2,970 RSUs vesting Jan 28, 2025 |
| Performance Shares Outstanding (Target) | 11,080 (2024 grant target); 10,940 (2023 grant target) |
| 2024 Option Exercises | 18,000 options exercised; value realized $1,040,528 |
| Stock Ownership Guidelines | 2.5× base salary for executive officers; 50% after-tax retention of equity gains until compliant; Ellman in compliance |
| Hedging/Pledging | Prohibited: no hedging, no margin accounts, no pledging, no public option trading |
| Clawback | Mandatory recovery of incentive-based comp upon accounting restatement (Rule 10D-1), effective Oct 2, 2023 |
| Option Dividend Equivalents | Dividend equivalents attached to NQSOs; accrue to vesting and then pay in cash until exercise/expiry |
Employment Terms
Executive Severance Plan (adopted Feb 2023) and Change-of-Control (COC) Agreements
| Scenario (as of 12/31/2024) | Cash Severance | Bonus (Accrued Obligations) | SRP Pension Increment | Equity Acceleration (Options/RSUs/PSUs) | Continued Benefits | Outplacement | Total |
|---|---|---|---|---|---|---|---|
| Voluntary Resignation/Retirement | — | 435,400 | — | Options $595,650; RSUs $447,524; PSUs $851,350 | — | — | $2,329,924 |
| Termination without Cause (no COC) | $1,586,100 | 435,400 | — | Options —; RSUs $447,524; PSUs $565,139 | $51,114 | $25,000 | $3,110,278 |
| Termination without Cause or Good Reason in COC | $3,172,200 | 435,400 | $952,053 | Options $1,146,907; RSUs $460,231; PSUs $1,706,109 | $102,228 | $62,200 | $8,037,328 |
| Death or Disability | — | 435,400 | — | Options $1,146,957; RSUs $447,524; PSUs $851,350 | — | — | $2,881,231 |
Policy highlights:
- Executive Severance Plan multiples (Exec VP): 18 months base salary and 1.5× target bonus (non‑COC); 24 months base and 2× target bonus in COC; prorated bonus and COBRA premiums; outplacement up to $25,000; double‑trigger vesting for equity .
- COC agreements are double-trigger, no excise tax gross-ups for NEOs; benefits may be cut to avoid excise tax and maximize after-tax payout .
Retirement & Deferred/Pension
| Plan | Present Value at 12/31/2024 |
|---|---|
| GATX Non‑Contributory Pension Plan (Salaried) | $913,516 |
| Supplemental Retirement Plan (Non‑Qualified) | $2,332,762 |
Compensation Structure Analysis
- Pay mix emphasizes at‑risk compensation: for NEOs ~70% of target pay tied to annual and long-term performance; options have value only if share price appreciates .
- Performance metrics intentionally balance return and growth across cycles: non‑GAAP net income for annual incentives and 3‑year LTI‑adjusted ROE and cumulative investment volume for PSUs (equal weight) .
- Rising rigor and payout mechanics: 2024 annual plan achieved 106% of target non‑GAAP net income, yielding 104.5% payouts; 2022–2024 PSUs paid 136.8% driven by outsized investment volume vs target .
- Governance safeguards: clawback, anti-hedging/anti-pledging, double‑trigger vesting, no repricing, and stock ownership/retention requirements .
Equity Ownership & Alignment
- Material “skin-in-the-game”: Ellman beneficially owns 130,542 shares (~0.37% of outstanding), with additional options exercisable within 60 days (86,066), indicating meaningful alignment without concentrated pledging or hedging risk under policy .
- Ownership guidelines: 2.5× salary and 50% after-tax retention; executive team in compliance, mitigating forced‑selling pressure from vesting events .
- 2024 liquidity activity: exercised 18,000 options ($1.04M realized), typical in-the-money monetization within trading windows; no evidence of margin pledging under policy .
Employment Terms
- Retention economics are solid but shareholder-friendly: meaningful severance and equity acceleration only with double-trigger (COC plus termination); no tax gross-ups for NEOs; robust COBRA and outplacement benefits .
- Executive severance constructs provide continuity while preserving alignment (equity accelerates only under specified triggers) .
Say‑on‑Pay & Shareholder Feedback
- Strong support: ~97% approval at the 2024 annual meeting; five-year average ~97%, indicating broad investor alignment with program design .
Performance & Track Record
- 2024 delivered strong cycle-aware performance: >99% North America fleet utilization, lease rate increases, $1.6B+ investment volume, and TSR >30%; EPS $7.78; ROE 12.1% .
- Pay-for-performance linkage evidenced by above‑target annual payout and elevated PSU payout driven by investment execution vs long-term targets .
Compensation Committee & Benchmarking
- Committee uses market surveys for companies with $1–3B revenues rather than a traditional peer set given GATX’s unique model; independent consultant Pay Governance engaged; program targets typically between 50th–75th percentile .
Related Party Transactions & Risk Indicators
- No related-party transactions requiring disclosure since Jan 1, 2024 .
- Insider trading controls: prohibits hedging, pledging, margining, and public option trading; clawback applies to incentive-based comp upon restatement .
Investment Implications
- Alignment: High proportion of at‑risk, cycle-aware incentives (non‑GAAP net income; LTI ROE and investment volume); stock options and PSU structures align Ellman’s rewards with rate, utilization, and disciplined investment outcomes through cycles .
- Retention & selling pressure: Ownership guideline compliance and anti‑pledging policy reduce forced selling risk; observed 2024 option exercise suggests typical liquidity rather than elevated selling pressure; double‑trigger COC mechanics limit windfall risk .
- Forward indicators: 2024–2026 targets (ROE 10.6%; investment volume $4.01B) frame PSU payout sensitivity; elevated recent PSU payouts were investment-led—future payouts hinge on sustaining high deployment and ROE in a potentially moderating rate backdrop .
- Governance quality: Strong say‑on‑pay, independent consultant, clawback, and anti‑hedging/pledging policies reduce comp‑related governance risk .