Chad N. Boudreaux
HUNTINGTON INGALLS INDUSTRIESAbout Chad N. Boudreaux
Chad N. Boudreaux, age 51, is Executive Vice President and Chief Legal Officer (CLO) of HII, serving in the role since April 2020 after joining HII in 2011; he previously served as Corporate Vice President for Litigation, Investigations & Compliance and as the company’s first Chief Compliance Officer (2013–2020). He earned a B.A. from Baylor University and a J.D. from the University of Memphis School of Law, and earlier held senior U.S. government roles (Deputy Chief of Staff at DHS and positions at DOJ) and practiced at Baker Botts, where he established the firm’s Global Security and Corporate Risk Counseling group . HII’s 2024 performance context for pay-for-performance includes consolidated revenue of $11.535B, diluted EPS $13.96, free cash flow of $40M, and a 2024 TSR of -25.7%; the company returned $368M to shareholders and ended 2024 with $48.7B backlog and record Mission Technologies revenue of $2.9B .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| HII | EVP & Chief Legal Officer | Apr 2020–present | Leads law department and external counsel across governance, compliance, litigation, and M&A support . |
| HII | Chief Compliance Officer | 2013–Apr 2020 | Oversaw nationally recognized compliance program . |
| HII | Corp. VP, Litigation, Investigations & Compliance | 2011–2013 | Managed litigation docket and compliance oversight . |
| Baker Botts LLP | Partner/practice lead | Pre-2011 | Established Global Security & Corporate Risk Counseling practice group . |
| U.S. Department of Homeland Security | Deputy Chief of Staff | Pre-2011 | Senior policy and operational leadership . |
| U.S. Department of Justice | Leadership roles | Pre-2011 | High-stakes litigation; DOJ Special Commendation for Outstanding Service . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base salary ($) | $563,077 | $570,001 | $584,470 |
| Annual incentive (AIP) paid ($) | $670,320 | $843,600 | $305,292 |
| Stock awards grant-date fair value ($) | $1,149,977 | $1,149,814 | $1,149,572 |
| All other compensation ($) | $174,005 | $160,846 | $207,749 |
| Total ($) | $2,557,379 | $2,724,261 | $2,247,083 |
Additional 2024 cash comp settings:
- 2024 base salary rate: $587,100 .
- AIP target: 80% of salary; target dollar $469,680 for 2024 .
- AIP targets were unchanged from 2023 for all NEOs except the CEO .
All other compensation detail (2024): Non-qualified plan match $154,599, qualified plan match $31,050, health & welfare $14,199, executive physical $2,000, financial planning $3,400, personal liability $2,501; total $207,749 .
Performance Compensation
Annual Incentive Plan (AIP) – corporate NEO structure (2024)
| Component | Weighting/Range | Design details |
|---|---|---|
| Corporate Performance Factor (CPF) | Capped at 200% | Based 90% on enterprise Operating Margin (segment operating income/revenue) and Operating Financial Cash Flow (OCF), and 10% on strategic leadership (leadership, ESG, cybersecurity, compliance) . |
| Individual Performance Factor (IPF) | 0.0–1.5 | IPF for Boudreaux was 1.0 in 2024 . |
AIP target levels (2024): Boudreaux 80% of salary ($469,680 target) . Actual 2024 AIP paid: $305,292 .
Long-Term Incentives (LTI)
LTI mix in 2024: 70% Restricted Performance Stock Rights (RPSRs) and 30% Restricted Stock Rights (RSRs) under HII’s 2022 LTIP plan .
RPSR performance metrics and weights (2024–2026 cycle):
- ROIC 40% (Adjusted FCF/Average Invested Capital) .
- EBITDAP 40% (Net earnings + interest + taxes + D&A − net pension/post-retirement expense) .
- Relative EBITDAP growth vs S&P Aerospace & Defense Select Index 20% .
Boudreaux 2024 LTI grants:
| Grant date | Instrument | Shares/Target | Grant-date fair value ($) | Vesting |
|---|---|---|---|---|
| 2/26/2024 | RPSR | 2,791 | 804,729 | Cliff after 3-year performance (2024–2026), 0–200% payout based on metrics |
| 2/26/2024 | RSR | 1,196 | 344,843 | Time-based, ratable over 3 years |
LTI realizations/vesting:
- 2021–2023 RPSR cycle vested in 2024; Boudreaux received 7,678 shares valued at $2,213,851 upon vesting .
- 2022–2024 RPSR cycle paid at 109% of target; earned RPSRs were issued Feb 24, 2025 (company-wide metric scorecard) .
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficial ownership (common shares) | 23,193 |
| Share equivalents | 2,150 |
| Total beneficial + equivalents | 25,343 |
| Shares outstanding (2/28/2025) | 39,235,568 |
| Ownership as % of SO | <1% (company statement; no individual exceeds 1%) |
| Unvested RSRs (12/31/2024) | 1,217 units; $229,974 market value at $188.97 close |
| Unearned (target) RPSRs (12/31/2024) | 2,840 units; $536,671 market value at $188.97 close |
| Options outstanding | None in 2024 (no stock options outstanding) |
| Stock ownership guideline | 3× salary for executives reporting to CEO |
| Compliance status | 253% of target ownership level (exceeds guideline) |
| Holding/hedging/pledging | Hedging and pledging prohibited; pre-2024 awards had post-vest holding; holding requirement eliminated for awards granted on/after 1/1/2024 . |
Insider selling pressure and vesting cadence:
- Time-based RSRs vest ratably over three years; performance-based RPSRs from the 2022–2024 cycle paid at 109% in Feb 2025, adding to potential share supply; in 2024, 7,678 performance shares vested for Boudreaux ($2.21M value) .
Employment Terms
Employment, clawback, and trading policies
- No individual employment agreement; officers are “at-will” .
- No change-in-control agreements or tax gross-ups for executives .
- Dodd-Frank-compliant compensation recovery (clawback) policy applies to executive officers and VPs; recovery of erroneously awarded incentive compensation following an accounting restatement .
- Insider trading policy prohibits hedging, pledging, and speculative transactions; trading limited to authorized windows .
Severance plan and equity treatment
- Severance Plan (for elected/appointed officers): 1.5× (base salary + target bonus) lump sum; 18 months medical/dental premiums; financial planning reimbursement up to $15,000 per year (two years); executive physical up to $4,000 in year of termination; outplacement up to 15% of base salary (one year) .
- Equity vesting on termination: death/disability accelerates RSRs and prorates RPSRs; retirement (age/service eligible) prorates RPSRs (RSR pro-rata within next 12 months for retirement-eligible); change-in-control plus qualifying termination accelerates both RSRs (full) and RPSRs (at target) .
Potential payments to Boudreaux if terminated on 12/31/2024
| Scenario | Severance ($) | Bonus ($) | Unvested RSR ($) | Unvested RPSR ($) | Health & welfare ($) | Planning & outplacement ($) | Total ($) |
|---|---|---|---|---|---|---|---|
| Change-in-control + qualifying termination | 1,585,170 | 305,292 | 229,974 | 2,818,299 | 24,937 | 118,065 | 5,081,736 |
| Involuntary (not for cause) / Good Reason | 1,585,170 | 305,292 | 63,775 | 2,110,858 | 19,609 | 115,217 | 4,252,402 |
| Death/Disability | — | 305,292 | 229,974 | 2,110,858 | — | — | 2,749,873 |
| Retirement (not currently eligible) | — | 305,292 | — | 1,232,462 | — | — | 1,537,754 |
Notes:
- Boudreaux is not retirement-eligible; therefore, in involuntary/retirement scenarios he would forfeit later-cycle RPSRs (2023–2025 and 2024–2026), receiving only the completed 2022–2024 cycle per plan terms .
Compensation Structure Analysis
- Mix and at-risk orientation: HII emphasizes variable, long-term, equity-linked pay; LTI awards consist primarily of performance-linked RPSRs with 3-year metrics tied to ROIC, EBITDAP, and relative EBITDAP growth, with caps at 200% to mitigate windfalls .
- 2024 settings vs 2023: AIP targets were unchanged for all NEOs except the CEO; 2024 LTI target values for Boudreaux were unchanged from 2023 (grant-date fair value ~$1.15M), indicating stability of incentive opportunity despite 2024 TSR headwinds .
- Clawback, no hedging/pledging, and ownership guidelines (Boudreaux at 253% of his 3× salary target) align incentives with shareholders while limiting risk-taking .
Say‑on‑Pay & Peer Group
- Say‑on‑pay support has been consistently strong: 96% “FOR” in 2024 (97% in 2020–2023) .
- Compensation peer group changes for 2025: BWX, Curtiss‑Wright, and Moog removed; Cognizant, General Dynamics, and Northrop Grumman added to better align size/sector; HII’s relative revenue positioning moves to the 50th percentile of the peer group .
Investment Implications
- Alignment and retention: Boudreaux exceeds stock-ownership guidelines (253% of target), is subject to strict hedging/pledging prohibitions, and has significant unvested equity (RSRs and multi-year RPSRs), supporting alignment and providing retention hooks; he is not retirement-eligible, which increases forfeiture risk upon voluntary departure and moderates near‑term exit risk .
- Performance sensitivity: AIP is driven 90% by enterprise OM and OCF with a defined IPF; LTI is tied to multi‑year ROIC/EBITDAP/relative EBITDAP, reinforcing cash and return discipline—key levers for HII given 2024 TSR decline and capital intensity .
- Supply from vesting: 2021–2023 RPSRs vested in 2024 (7,678 shares, $2.21M), and the 2022–2024 cycle paid at 109% in Feb 2025—events that can add modest insider share supply around vest dates, though policy restrictions and holding norms (for pre‑2024 awards) temper immediate sales .
- Downside protections: No employment or CIC agreements and no tax gross‑ups, a robust clawback, and capped plan payouts reduce shareholder‑unfriendly features and mitigate excess risk-taking .