David E. Phillips
GOODYEAR TIRE & RUBBER CO /OH/About David E. Phillips
David E. Phillips is Senior Vice President and General Counsel of The Goodyear Tire & Rubber Company, serving as the company’s chief legal officer; he was appointed in June 2019, joined Goodyear in 2011, and is 49 years old . Company performance metrics relevant to executive incentives: 2024 segment operating income was $1,318 million (+36.2% YoY) and SOI margin reached 7.0% (+2.2 pts YoY), driven by the Goodyear Forward plan; targets include a 10% segment operating margin by Q4 2025 and net leverage of 2.0x–2.5x . Over the 2022–2024 long-term cycle, GT’s TSR ranked at the 17th percentile versus peers, applying a 0.8x TSR modifier to payouts, with ESG index goals achieved (+25 percentage point uplift) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Goodyear Tire & Rubber Company | Senior Vice President and General Counsel | June 2019–Present | Chief legal officer; oversees all legal matters |
Fixed Compensation
Multi-year compensation (as reported in Summary Compensation Table):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 591,667 | 633,333 | 715,000 |
| Bonus ($) | — | 100,000 | — |
| Stock Awards ($) | 718,028 | 678,585 | 964,258 |
| Option Awards ($) | — | — | — |
| Non-Equity Incentive Plan Compensation ($) | 632,734 | 1,160,426 | 1,140,959 |
| Change in Pension Value & Nonqualified Deferred Compensation Earnings ($) | — | 419,492 | 493,689 |
| All Other Compensation ($) | 21,364 | 14,504 | 20,575 |
| Total ($) | 1,963,793 | 3,006,340 | 3,334,481 |
Base salary changes (committee review):
- Phillips’ base salary increased from $650,000 (2023) to $715,000 (2024) .
2024 Annual Incentive (AIP) outcome:
| Item | Value |
|---|---|
| Target Award ($) | 643,500 |
| Actual Award ($) | 495,495 |
| Actual as % of Target | 77% |
Perquisites and other details (2024):
| Category | Amount ($) |
|---|---|
| Personal use of company aircraft | 6,775 |
| Contributions to Savings Plan | 13,800 |
| Total Perquisites & Other Benefits | 20,575 |
Performance Compensation
Annual Incentive Plan (AIP) metrics and payout mechanics for corporate officers (Phillips’ payouts based on overall company results):
| Metric | Weight | Threshold | Target | Maximum | Actual | % Achieved | Weighted Payout |
|---|---|---|---|---|---|---|---|
| SOI Margin | 40% | 5.75% | 7.50% | 7.75% | 6.37% | 78% | 31.2% |
| Free Cash Flow ($) | 40% | 0 | 100 | 250 | 46 | 78% | 31.2% |
| Strategic Objectives | 20% | n/a | n/a | n/a | Aggregate achieved 10% of 20% | — | 10% |
| Overall Company Payout | — | — | — | — | — | — | 72% |
Notes:
- 2024 “Free cash flow, as adjusted” reconciliation in proxy shows bridges from operating cash flow to adjusted FCF of $46 million .
- AIP target set to emphasize Goodyear Forward profitability and cash generation .
Long-Term Incentives (LTI) – 2024–2026 program:
- Mix and vesting: RSUs (~30% target) three-year ratable vesting; PSUs (~30%); Cash-settled EPUs (~40%) .
- Financial metrics/weights: Net Income (40%), CFROC (40%), 3-Year Margin Growth (20%); TSR modifier 0.8x–1.2x, capped at 1.0x if absolute TSR negative; overall max payout 200% .
- 2024 performance period earnings under LTI set at 81% of target for 2022–2024, 2023–2025, and 2024–2026 awards .
Phillips – LTI earned amounts for the 2024 performance period:
| Award Cycle | Aggregate Target Award ($) | Cash Portion ($) | Share Portion (#) |
|---|---|---|---|
| 2022–2024 (2024 period) | 293,972 | 189,000 | 4,880 |
| 2023–2025 (2024 period) | 359,901 | 202,500 | 7,098 |
| 2024–2026 (2024 period; NI & CFROC components) | 336,975 | 155,520 | 9,876 |
2022–2024 cycle payout totals including modifiers:
| Component | Amount |
|---|---|
| Cash Payout ($) | 481,100 |
| Shares Payout (#) | 12,421 |
| TSR Modifier | 0.80x; TSR at 17th percentile |
| ESG Index Uplift | +25 percentage points; goals achieved |
2024 Grants of Plan-Based Awards (Phillips):
| Grant Type | Threshold (#) | Target (#) | Maximum (#) | Grant-Date Fair Value ($) |
|---|---|---|---|---|
| PSU Grant A | 3,013 | 6,025 | 12,050 | 60,672 |
| PSU Grant B | 4,382 | 8,764 | 17,528 | 109,901 |
| PSU Grant C | 10,669 | 21,337 | 42,674 | 253,697 |
| RSUs | — | — | — | 539,988; 45,723 units |
Equity Ownership & Alignment
Beneficial ownership (as of Feb 18, 2025):
| Category | Amount |
|---|---|
| Shares of Common Stock Owned Directly | 5,159 |
| Shares Held in Savings Plan | — |
| Shares Subject to Exercisable Options | 150,000 |
| Deferred Share Equivalent Units and RSUs | 79,000 |
| Percent of Class | <1% |
Stockholding guidelines and alignment policies:
- Required ownership: 3x base salary for Senior Vice President; officers must hold 100% of net shares until requirement met; once met, retain 25% of net shares for at least one year after vest/exercise .
- Compliance: NEOs complied or are working toward satisfying requirements in 2024 .
- Prohibitions: Hedging and pledging of company stock are prohibited; no margin accounts allowed .
- No new stock option grants in 2022–2024; options outstanding remain per plan terms .
Insider transactions and selling pressure:
- We attempted to retrieve Form 4 transactions for “David E. Phillips” (2023–2025) via the insider-trades skill; the request was unauthorized (HTTP 401), so we cannot provide recent transaction-level selling/buying data at this time. Beneficial ownership and policy details above help assess alignment [ReadFile: insider-trades SKILL.md; failed fetch noted].
Employment Terms
Executive Severance and Change-in-Control (CIC) framework:
- Severance multiples: Termination without cause – cash severance equals (base salary + target annual incentive) × severance multiple (Phillips: 1.5x); CIC double-trigger – cash severance equals 2× (base salary + target annual incentive) with vesting and benefits as specified .
- Plan features: Double-trigger CIC vesting for equity; no excise tax gross-ups or walk-away rights; covenants include confidentiality, non-disparagement, non-solicitation, and non-compete; plan auto-renews annually and is currently extended through Feb 28, 2026 .
Quantification of potential payouts (assuming event on Dec 31, 2024):
| Triggering Event | Cash Severance ($) | Annual & LT Cash Incentives ($) | Equity ($) | Supplementary Plan and Additional Retirement Benefits ($) | All Other Benefits ($) | Total ($) |
|---|---|---|---|---|---|---|
| Death/Disability | — | 1,457,115 | 1,098,305 | — | 26,125 | 2,581,545 |
| Retirement | — | 976,595 | 111,789 | — | 26,125 | 1,114,509 |
| Termination Without Cause | 2,037,750 | 976,595 | 111,789 | — | 65,671 | 3,191,805 |
| Involuntary Termination Within Two Years of Change in Control | 2,717,000 | 2,235,115 | 1,694,331 | 2,275,512 | 70,519 | 8,992,477 |
Supplementary Plan vesting nuance:
- Phillips is not yet vested in the Supplementary Plan under normal circumstances; benefits vest upon CIC double-trigger with ≥5 years of service; pension valuation differences explained in proxy (Phillips’ Supplementary Plan amount in pension table: $1,933,637; CIC-trigger table uses assumption-adjusted value $2,275,512) .
Clawback policy:
- Awards under the Amended 2022 Plan subject to recoupment under the Compensation Recovery Policy; change in control equity vesting operates under double-trigger terms .
Investment Implications
- Pay-for-performance alignment: 2024 AIP paid at 77% of Phillips’ target, consistent with overall company payout of 72%, reflecting below-target SOI margin and FCF outcomes; LTI earnings at 81% for the 2024 performance period indicate measured payouts tied to profitability and CFROC .
- Alignment and retention: Ownership guidelines (3x salary) and prohibitions on hedging/pledging improve alignment; existing exercisable options (150,000) and RSU overhang (79,000) indicate future vesting events but policies constrain opportunistic selling, moderating near-term selling pressure .
- Change-in-control economics: Double-trigger severance and equity acceleration create material payouts ($9.0 million total in CIC scenario), signaling strong retention through potential strategic actions but increasing takeover-related cost to shareholders; absence of tax gross-ups is shareholder-friendly .
- Execution risk: TSR underperformance (17th percentile) and reliance on Goodyear Forward targets (SOI margin expansion, net leverage) underscore ongoing execution risk; however, incentive structures explicitly weight profitability and capital efficiency, suggesting future payouts will remain sensitive to operational delivery .
Additional references for governance context: Compensation Committee independence, membership, and use of Exequity LLP as independent consultant ; 2024 say‑on‑pay approval of 94.9% indicates broad shareholder support for redesigned metrics and weighting .
Legal role context: Phillips executes material agreements (e.g., Sumitomo amendment signature) and acts as attorney‑in‑fact on securities filings, reinforcing centrality of the GC role in portfolio optimization and transactions .