Patrick Kelleher
GXO LogisticsAbout Patrick Kelleher
Patrick Kelleher, 56, was appointed Chief Executive Officer of GXO Logistics effective August 19, 2025. He brings 33 years of global supply chain leadership from DHL Supply Chain, where he most recently served as CEO, North America, and previously as global chief development officer and CEO, Americas at Williams Lea Tag (under DHL), with a track record in engineered solutions, automation, robotics deployment and M&A execution . For performance context at GXO pre‑transition, 2024 results were $11.7B revenue, $138M net income, $1.12 diluted EPS, $815M adjusted EBITDA, $549M cash from operations, and $251M free cash flow; 2022 PSU rTSR performance certified at the 14th percentile (0% payout on that component), highlighting the emphasis on relative TSR and cash conversion in pay design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| DHL Supply Chain (Deutsche Post DHL Group) | CEO, North America | Not disclosed | Oversaw significant growth and operational improvements |
| DHL Supply Chain | Global Chief Development Officer | Not disclosed | Led strategic initiatives across transportation, planning, engineered solutions, automation |
| Williams Lea Tag (under DHL ownership) | CEO, Americas | Not disclosed | Led business in Americas; experience across consumer, healthcare, tech, ecommerce, manufacturing |
| DHL Supply Chain | Robotics deployment leader | 2023 onward (context) | Deployed advanced robotics (e.g., Boston Dynamics Stretch); oversaw four M&A transactions in the past year |
Fixed Compensation
| Component | Terms |
|---|---|
| Base Salary | $700,000 annually |
| Target Annual Bonus | 160% of base salary; 2025 bonus guaranteed at least target, prorated from Effective Date |
| Sign‑On Cash Bonus | $250,000 (forfeited bonus make‑whole); repayable if voluntary resignation without good reason or termination for cause within 12 months of Effective Date; payable if terminated without cause before payment date |
| Relocation/Commuting | Required relocation to Greenwich, CT by Dec 31, 2025; airfare/lodging reimbursement before relocation; repayment obligation if voluntary resignation w/o good reason or termination for cause before Dec 31, 2026 |
| Legal Fees | Reimbursement up to $10,000 for offer letter legal fees |
| Benefits/Indemnification | Eligible for executive benefits; covered by D&O insurance and indemnification on same terms as peers |
Performance Compensation
Sign‑On Equity (in lieu of 2025 annual LTI)
| Award | Grant Value | Vesting | Performance Metrics | Notes |
|---|---|---|---|---|
| RSUs (Sign‑On) | $1,250,000 | Vests in equal annual installments over 3 years from grant date | N/A (time‑based) | Shares determined using 30‑day average closing price before appointment announcement |
| PSUs (Sign‑On) | $3,400,000 | Cliff vests on 3rd anniversary of grant date | rTSR vs S&P MidCap 400 over 3 years; 0–225% payout; capped at 100% if absolute TSR is negative | Shares determined using 30‑day average closing price before appointment announcement |
Ongoing LTI (from 2026)
| Element | Target Value | Design & Metrics |
|---|---|---|
| Annual LTI Opportunity (from 2026) | Not less than $3,400,000 | Company’s LTI program uses PSUs and RSUs. 2024 PSU metrics: 34% rTSR vs S&P MidCap 400; 33% 3‑yr cumulative organic revenue growth; 33% 3‑yr average annual Adjusted EBITDA conversion to FCF; Operating ROIC modifier ±10% (200% cap). RSUs vest in 3 equal annual installments . |
Annual Incentive Plan (AIP) – Company Design Reference
| Metric | Weighting | Notes |
|---|---|---|
| Company STI framework | Not disclosed in offer letter | GXO added “Net New Business” to AIP in 2024; NEOs elected to take 0 payout for 2024 despite 73% formulaic funding to align with “quality earnings” . |
Equity Ownership & Alignment
| Policy / Position | Terms |
|---|---|
| CEO Stock Ownership Guideline | 6x annual base salary; compliance assessed using common shares and time‑based unvested RSUs; options and performance‑based awards excluded until settled/exercised; 70% net‑share retention until met; 5 years to comply |
| Hedging/Pledging | Pledging or holding in a margin account and hedging transactions prohibited without preclearance |
| Beneficial Ownership | As of April 1, 2025 (proxy record date), Kelleher was not yet listed among NEOs; sign‑on equity to be granted “upon the Effective Date,” with share counts based on the 30‑day average prior to announcement . |
Employment Terms
| Term | Details |
|---|---|
| Start/Role | CEO, effective August 19, 2025 |
| Location | HQ Greenwich, CT; relocation required by Dec 31, 2025 |
| Restrictive Covenants | Confidentiality and mutual non‑disparagement (during and after employment); employee non‑solicit during employment and 1 year after; customer non‑solicit during employment and 2 years after; non‑compete during employment and 18 months after; company may extend non‑compete twice by 6 months each |
| Severance Plan (Non‑CIC) | CEO: 18 months base salary continuation, prorated target annual bonus, and up to 18 months healthcare at active employee rate or cash in lieu (subject to release and covenants) |
| Severance (CIC, double‑trigger ≤ 2 years) | CEO: lump sum 2.5x (base salary + target bonus) + prorated target bonus + healthcare benefit (subject to release and covenants) |
| 280G Treatment | Best‑net approach (pay all and pay excise tax or cut back to avoid excise tax), whichever yields higher after‑tax amount; no gross‑ups |
Illustrative CIC cash multiple using current terms: 2.5 × ($700,000 + 160% × $700,000) = 2.5 × $1,820,000 = $4,550,000, plus prorated bonus and healthcare benefit (actual amounts depend on timing and plan details) .
Compensation Structure Notes (Governance and Risk)
- Equity mix and metrics: Heavy use of PSUs with rTSR, multi‑year organic revenue growth, and EBITDA‑to‑FCF conversion, plus an Operating ROIC modifier, anchor pay to value creation and capital discipline .
- No options program: Company does not currently grant stock options to employees, reducing repricing risk; 2024 RSUs vest over three years .
- Clawbacks: Applies to LTI and annual bonus upon restrictive covenant breaches, for‑cause termination, misconduct causing material loss, and for NYSE/SEC restatement recovery (3 prior fiscal years) .
- Say‑on‑pay support: 2024 say‑on‑pay approval ~90%, indicating stockholder alignment with the compensation program .
Investment Implications
- Alignment and performance sensitivity: Kelleher’s package is geared toward at‑risk equity, with a large 3‑year rTSR sign‑on PSU and a 2026 LTI at ≥$3.4M, tied to rTSR, organic growth, EBITDA‑to‑FCF conversion, and ROIC—directly linking realizable pay to multi‑year shareholder outcomes .
- Limited near‑term selling pressure: Time‑vested sign‑on RSUs vest over three years; PSUs cliff‑vest at year 3 (with payout variability and a negative TSR cap), moderating early liquidity vs. typical front‑loaded awards; expect sell‑to‑cover around RSU vest dates but no options overhang given program design .
- Retention and protection: Robust non‑compete (18 months, extendable), non‑solicit and confidentiality, plus the severance plan and best‑net 280G treatment, balance retention with shareholder protections (no excise tax gross‑ups) .
- Execution lens: Company’s 2024 fundamentals (revenue $11.7B, adjusted EBITDA $815M) and prior PSU certification (rTSR at 14th percentile for 2022 grant) underscore the opportunity and challenge—Kelleher’s pay levers are explicitly calibrated to outperform peers on TSR and convert EBITDA to cash under a ROIC overlay .
Overall: The package is shareholder‑oriented with multi‑year, performance‑linked equity and strong governance features; watch rTSR cohort positioning, organic growth cadence, FCF conversion, and potential tax‑selling around RSU vest dates as indicators for insider supply and confidence.
Sources
- CEO appointment and offer letter terms, compensation, sign‑on awards, covenants, relocation, and timing .
- Company press release on appointment and background (robotics, M&A) .
- Severance Plan and CIC/change‑of‑control economics .
- Stock ownership guidelines and insider trading (hedging/pledging) policies .
- LTI metric design (PSUs/RSUs), Operating ROIC modifier, vesting structure .
- 2022 PSU certification outcomes (including rTSR percentile) .
- 2024 company performance metrics (revenue, net income, EPS, adj. EBITDA, CFO, FCF) .
- Say‑on‑pay support commentary .