Steve Downing
GENTEXAbout Steve Downing
Steve Downing, age 47, is President & CEO of Gentex (since January 1, 2018) and a director since 2020; he joined Gentex in 2002 and previously served as CFO, SVP & CFO, and President & COO, giving him deep financial and operational credentials aligned with the company’s growth strategy . Corporate performance under his tenure includes 2024 net sales of $2,313,314k (+1% y/y) and net income of $404,488k, with EPS of $1.76, while TSR tracked at 107.41 for 2024 in the pay-versus-performance disclosure; long-term LTIP metrics emphasize cumulative EBITDA and ROIC, with 2022–2024 cumulative EBITDA at $1,610,066k (84.26% of target) and ROIC at 37.02% (67.90% of target) . He is not an independent director; the Board has an independent Chair and a Lead Independent Director policy to mitigate dual-role concerns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Gentex Corporation | Vice President of Finance & CFO | May 2013 – June 2015 | Strengthened financial management; set foundation for capital discipline |
| Gentex Corporation | Senior Vice President & CFO | June 2015 – Aug 2017 | Led finance through margin pressure and product growth |
| Gentex Corporation | President & COO | Aug 2017 – Dec 2017 | Transitioned to operational leadership across functions |
| Gentex Corporation | President & CEO | Jan 2018 – present | Strategy execution, capital allocation, growth and LTIP accountability |
External Roles
No external public-company directorships or roles disclosed for Steve Downing in the latest proxy .
Fixed Compensation
| Element | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 792,693 | 842,693 | 850,000 |
| Other Compensation ($) | 245,729 | 273,914 | 364,768 |
| Notes | Salary remained flat at $850,000 for 2025 as requested by NEOs; CEO guideline disclosed separately . Perquisites include aircraft and autos; 401(k) and deferred comp matches included . |
Additional fixed compensation detail (2024 perquisites/matches):
- RS dividends $41,500; PSA deemed dividends $137,642; 401(k) match $17,250; Deferred comp match $59,935; personal auto $25,288; personal aircraft $73,253; other perqs $9,900 (Total $364,768) .
Performance Compensation
Annual Incentive Plan (AIP) – Structure and 2024 Outcomes
- Target opportunity: CEO threshold 55% of salary; target 110%; max 220% of salary; metrics and weights: Revenue (33.33%), Operating Income (33.33%), Diluted EPS (33.33%) .
- 2024 metric targets and actuals:
| Metric | Weight | Threshold | Target | Maximum | Actual |
|---|---|---|---|---|---|
| Revenue ($000s) | 33.33% | 2,000,000 | 2,500,000 | 3,000,000 | 2,313,314 |
| Operating Income ($000s) | 33.33% | 450,000 | 562,500 | 675,000 | 459,727 |
| Diluted EPS ($) | 33.33% | 1.62 | 2.02 | 2.42 | 1.76 |
- 2024 CEO AIP payout: $634,211 (no discretionary bonus) .
Long-Term Incentive Plan (LTIP)
- Mix: 70% PSAs; 30% RS; cliff vest after 3-year performance period (PSAs) and 3 years from grant (RS); employment required unless retirement/good reason/death/disability/change-in-control; double-trigger equity vesting upon change-in-control; no stock options granted to NEOs in recent years .
- 2024 grants (grant date 02/15/24):
| Award | Granted (Target) | Vesting | Grant-date Fair Value ($) |
|---|---|---|---|
| PSAs (2024–2026) | 68,016 shares | Cliff vest after 3-year performance period | 2,386,001 |
| RS (2024 grant) | 29,150 shares | Cliff vest on 3rd anniversary | Included above |
- LTIP performance results (2022–2024 period):
| Metric | Weight | Threshold | Target | Maximum | Actual | Performance vs Target | CEO PSA Payout (shares) |
|---|---|---|---|---|---|---|---|
| Cumulative EBITDA ($000s) | 50% | 1,310,720 | 1,747,627 | 2,184,534 | 1,610,066 | 84.26% | 51,879 |
| Cumulative ROIC (%) | 50% | 33.08 | 44.10 | 55.13 | 37.02 | 67.90% | 51,879 (aggregate payout) |
NEO pay mix emphasis: CEO 86% performance-based at target (2024), reinforcing pay-for-performance .
Equity Ownership & Alignment
| Ownership Item | Value |
|---|---|
| Shares beneficially owned | 290,623 (sole voting/investment power unless noted) |
| Exercisable options (within 60 days) | 101,000 |
| Ownership as % of outstanding | Less than 1% |
| RS not vested (count; market value at 12/31/24) | 89,164; $2,561,682 |
| PSAs unearned (target; payout value at 12/31/24) | 227,644; $7,006,903 |
| Stock ownership guidelines | CEO 5x base salary; includes RS/PSAs granted and owned shares; 5-year compliance schedule |
| Hedging/Pledging | Prohibited for officers/directors |
Vesting schedules:
- RS grants vest on third anniversary of grant date (e.g., 02/15/24 grant vests on 02/15/27) .
- Options vest 25% annually; CEO has legacy options exercisable at $22.94 expiring 02/15/2028 (101,000 outstanding) .
2024 equity realized:
- RS vested: 43,530 shares valued at $1,528,774; no option exercises in 2024 for CEO .
Employment Terms
- Base salary frozen for 2025 at $850,000 at CEO’s request (market conditions) .
- AIP payout range: 0–220% of base for CEO; metrics and weights fixed since 2019; thresholds/max ±20% around target in 2025 .
- Change-in-control: double-trigger vesting policy for equity awards; no separate change-in-control cash severance contracts for NEOs beyond equity treatment disclosed .
- Clawback: Incentive-Based Compensation Recoupment Policy compliant with Nasdaq listing standards .
- Insider trading: Policy prohibits hedging/pledging and certain derivatives; Section 16 compliance noted with no delinquencies .
- Deferred compensation: CEO contributed $600,449; company credited $59,935; 2024 aggregate earnings $307,025; YE 2023 balance $2,455,015 .
Board Governance
- Board service: Director since 2020; serves on Executive Committee; not independent .
- Board leadership: Independent Chair (Richard Schaum); Lead Independent Director policy in place; independent directors meet outside management .
- Committees (current composition): Audit (Deur—Chair, Starkoff, Walker); Compensation (Schaum—Chair, Deur, Walker); Nominating & Corporate Governance (Brown—Chair, Anderson, Zang); Executive (Schaum—Chair, Deur, Downing, Walker) .
- Attendance: All directors attended 2024 Annual Meeting; at least 75% attendance at Board/committee meetings; five Board meetings in 2024 .
- Director compensation: Employee directors receive no director pay; non-employee director retainer and RS grants detailed separately .
Multi-year CEO Compensation Summary
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | 792,693 | 842,693 | 850,000 |
| Stock Awards ($) | 2,865,225 | 4,418,429 | 2,931,383 |
| Non-Equity Incentive ($) | 604,720 | 1,576,495 | 634,211 |
| All Other Compensation ($) | 245,729 | 273,914 | 364,768 |
| Total ($) | 4,508,367 | 7,111,531 | 4,780,362 |
Performance Compensation – Detailed Structure
| Metric | Weighting | Target Setting | 2024 Actual | Payout Mechanics | Vesting |
|---|---|---|---|---|---|
| Revenue (AIP) | 33.33% | $2,500,000k | $2,313,314k | Linear between threshold/target/max; CEO payout $634,211 total AIP | Annual cash |
| Operating Income (AIP) | 33.33% | $562,500k | $459,727k | Same as above | Annual cash |
| Diluted EPS (AIP) | 33.33% | $2.02 | $1.76 | Same as above | Annual cash |
| Cumulative EBITDA (PSA) | 50% | $1,747,627k (2022–2024) | $1,610,066k | 0–200% of target; threshold 50% payout | 3-year cliff vest |
| Cumulative ROIC (PSA) | 50% | 44.10% (2022–2024) | 37.02% | Same as above | 3-year cliff vest |
| Restricted Stock (RS) | 30% of LTIP value | Granted annually | 29,150 shares in 2024 | Time-based; dividends paid | 3-year cliff vest |
Compensation Peer Group and Say-on-Pay
- Peer benchmarking: Targets near market median for selected peer group (Allison Transmission, ITT, Littelfuse, Gentherm, Graco, Visteon, etc.) .
- 2024 Say-on-Pay support: 96% approval; Committee continues pay-for-performance alignment focus .
Equity Ownership & Trading Signals
| Indicator | Detail |
|---|---|
| Upcoming RS vest dates | 2022 grants vested in 2025; 2024 grants vest in 2027; monitor potential supply around vest dates |
| Options | 101,000 options expiring 02/15/2028 at $22.94; 25% annual vesting historically; could influence exercise decisions with price moves |
| Insider activity (2024) | No CEO option exercises; RS vesting realized value $1,528,774 |
| Pledging/Hedging | Prohibited; reduces forced selling/pledge risk |
Employment Terms – Risk/Retention
- No separate golden parachutes or cash severance contracts tied to change-in-control; equity accelerates with double-trigger—reduces windfall risk, maintains retention via performance and service conditions .
- Deferred comp balances and ongoing matching create retention hooks; CEO YE 2023 balance $2,455,015 with 2024 company credits $59,935 .
- Ownership guidelines (5x salary) and broad-based equity culture increase alignment; clawback adds downside risk on misstatement .
Investment Implications
- Compensation alignment: High share of at-risk pay (AIP + PSAs/RS) tied to revenue, operating income, EPS (annual) and cumulative EBITDA/ROIC (multi-year) supports disciplined growth and capital efficiency; recent LTIP payout below target indicates rigorous hurdles and potential upside with margin/ROIC improvements .
- Selling pressure/float: RS cliff-vesting and legacy options expiring in 2028 create episodic supply risk around vest dates and potential exercises; hedging/pledging bans mitigate collateral-driven sales risk .
- Governance: Non-independent CEO with independent Chair, active committees, and strong policies (clawback, anti-pledging, ownership guidelines) reduces dual-role governance risk; 96% say-on-pay support signals investor acceptance of pay design .
- Execution track record: 2024 net sales at record levels with AIP payout reflecting partial achievement; LTIP results below target on EBITDA/ROIC highlight continued focus on efficiency; monitoring AIP/LTIP metrics and upcoming vesting cycles can inform timing around catalysts and potential insider supply .