Essex D. Mitchell
HOLOGICAbout Essex D. Mitchell
Essex D. Mitchell is Chief Operating Officer (COO) of Hologic, appointed effective January 1, 2024, after serving as Division President, GYN Surgical Solutions since August 2020 and joining Hologic in September 2017 as VP of Sales and Commercial Excellence (GYN Surgical) . He is 45 and holds a BS in Business Administration from The Ohio State University; prior to healthcare he played professional football in the NFL and CFL, and spent ~11 years at Stryker in commercial leadership roles . Company performance context for fiscal 2024: Hologic delivered $4.03B in revenue, GAAP EPS of $3.32, and non-GAAP adjusted EPS of $4.08; adjusted revenue growth guidance and margins underpin pay-for-performance design (STIP funding at 109%) . In 2024, GYN Surgical (his prior division) grew revenue 6.1% to $641.3M; as COO he was credited with driving growth, quality focus, and executing acquisitions (Endomagnetics, Gynesonics) in his STIP goals .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Hologic | Chief Operating Officer | Jan 2024–present | Led growth initiatives, quality focus, and M&A execution (Endomagnetics, Gynesonics) per STIP objectives . |
| Hologic | Division President, GYN Surgical Solutions | Aug 2020–Dec 2023 | Drove Surgical growth; Hologic Surgical revenue +6.1% in FY24 to $641.3M . |
| Hologic | VP, Sales & Commercial Excellence (GYN Surg.) | Sep 2017–Aug 2020 | Commercial leadership foundation for Surgical growth . |
| Stryker Corporation | Various commercial leadership roles | 2006–2017 | Led sales/marketing across multiple divisions . |
| NFL/CFL | Professional football player | Prior to healthcare | Leadership and team performance experience . |
External Roles
No public company directorships or external roles disclosed for Mr. Mitchell .
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary (annual rate) | $420,000 | $650,000 |
| Actual Salary Paid (SCT) | $419,615 | $592,692 |
| Target Bonus % of Salary | n/a disclosed | 100% (effective FY24) |
| Actual STIP Bonus Paid | $360,000 | $725,000 |
| Company DCP Contribution | $118,667 | $150,650 |
Notes: FY24 target bonus set at 100% of base with DCP target of $140,000 per promotion 8‑K ; company contribution actually funded at $150,650 (included in “All Other Compensation”) .
Performance Compensation
Annual Cash Incentive (STIP) – Design and FY2024 Outcome
| Element | Detail |
|---|---|
| Metrics & Weighting | Adjusted Revenue (60%), Adjusted EPS (40%) |
| Target Rigor (FY24) | Revenue target ≈ +0.6% vs prior-year adjusted; maximum ≈ +6.1%; EPS target ≈ −1.3% vs prior-year adjusted; maximum ≈ +11.1% |
| Corporate Funding Result | 109% of target (Adj. Revenue 91% of target; Adj. EPS 134% of target) |
| Mitchell’s Payout | 112% of target; total bonus $725,000 |
| Individual Priorities | Drive top/bottom-line growth and quality; pipeline/M&A (Endomagnetics/Gynesonics); succession/talent |
Long-Term Incentives (LTIP) – Structure and FY2024 Grants
- Mix: 50% PSUs (performance), 25% RSUs (time-based), 25% Stock Options (time-based) .
- PSU performance metrics and goals:
- Adjusted Free Cash Flow (3-year cumulative): Target $2.9B; Max $3.5B .
- Adjusted ROIC (3-year average): Target 13%; Min 10%; Max 16% .
- Relative TSR (3-year vs peer group): Target 50th percentile; Max 95th; capped at 100% if absolute TSR negative .
- Vesting: PSUs cliff-vest after 3 years subject to performance; RSUs vest in 3 annual tranches; options vest in 4 annual tranches; 10-year option term .
FY2024 Grant Details (Grant date 11/14/2023)
| Award Type | Target/Grant | Vesting/Terms | Grant Date Fair Value |
|---|---|---|---|
| RSUs | 8,687 units | 3 equal annual installments | $624,943 |
| Stock Options | 25,070 options @ $71.94 strike | 4 equal annual installments; 10-year term | $624,995 |
| PSUs – FCF | 8,687 target units (0–200% payout) | 3-year cliff; target $2.9B cum FCF | $624,943 |
| PSUs – ROIC | 4,343 target units (0–200% payout) | 3-year cliff; target 13% ROIC | $312,435 |
| PSUs – TSR | 4,343 target units (0–200% payout) | 3-year cliff; target 50th percentile TSR | $382,445 |
Program performance context: FY2022 PSU cycles (granted in Nov 2021) vested in Nov 2024 at 146% (FCF), 200% (ROIC), and 160% (TSR) for the company, indicating above-target long-term performance realization .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (1/6/2025) | 21,995 shares; <1% of outstanding |
| Options Exercisable (within 60 days of 1/6/2025) | 12,065 options |
| Unexercisable Options Outstanding | 25,070 (11/14/2023 grant, $71.94), plus earlier grants (e.g., 8,697 at $74.35; 5,944 at $71.13; 1,877 at $68.35) |
| Unvested RSUs | 8,687 (11/14/2023 grant; vests over 3 years) |
| Outstanding PSUs (unearned, target) | FY2024 cycle: 17,374 FCF; 8,686 ROIC; 8,686 TSR (0–200% payout contingent) |
| Stock Ownership Guidelines | NEOs must hold 3x base salary within 5 years; policy strengthened Dec 2024 |
| Hedging/Pledging | Prohibited for executives and directors |
| Clawback | Policy updated to comply with Nasdaq Rule 10D‑1; mandatory recoupment on restatements; discretionary for fraud/misconduct |
Insider activity (FY2024): Options exercised = 0; shares vested = 10,562; gross value realized on vesting = $712,592 (pre-tax/withholding) .
Employment Terms
| Scenario (as of 9/28/2024) | Cash Severance | Equity Treatment | DCP Acceleration | Health/Welfare | Total |
|---|---|---|---|---|---|
| Change of Control (termination without cause/for good reason, double-trigger) | $3,939,900 | $4,388,415 (share awards) | $100,433 | $21,498 | $8,450,246 |
| Involuntary Termination (without cause) or Good Reason | $1,317,692 | — | — | $21,498 | $1,339,190 |
| Death or Disability | $2,042,692 | $3,116,204 (share awards) | $100,433 | $64,495 | $5,323,824 |
Key provisions:
- Double-trigger CoC: benefits payable only upon qualifying termination in connection with a change in control; terms mirror CEO’s CoC framework (including 2.99x construct at the program level) with 1-year benefits continuation; no tax gross-ups .
- Severance (non-CoC): one-year salary continuation and pro‑rated bonus; one-year benefits continuation .
- Equity: Retirement, death, disability treatment per award agreements (continued or accelerated vesting subject to plan terms) .
Compensation Structure Analysis
- Increased at-risk pay: FY2024 LTIP award doubled to $2.5M (+108% YoY) with promotion to COO; base increased to $650k (+55% YoY) and target bonus set at 100% of salary; DCP target set at $140k (company contribution actually $150.7k) .
- Strong pay-for-performance linkage: STIP tied to adjusted revenue and EPS with 109% corporate funding; individual payout 112% reflects above-target EPS and role-based objectives (growth, quality, M&A, talent) .
- Long-term metrics balanced: PSUs on FCF, ROIC, and relative TSR with challenging goals and negative TSR cap; time-based RSUs/options support retention .
- Shareholder oversight: Say‑on‑pay support improved to 79% in 2024 (from 77% in 2023; 70.47% in 2022; 69% in 2021), after outreach and program refinements .
Say‑on‑Pay & Shareholder Feedback
| Year | Say‑on‑Pay Approval |
|---|---|
| 2021 | 69% |
| 2022 | 70.47% |
| 2023 | 77% |
| 2024 | 79% |
Investors supported continuity of design, stronger disclosure rationales, consideration of vesting length; company affirmed no hedging/pledging, no option repricing, double‑trigger CoC, and clawback policy updates .
Compensation Peer Group (benchmarking)
Primary peer group used for FY2024 pay setting includes Agilent, Baxter, Boston Scientific, DENTSPLY, Edwards, IDEXX, Illumina, Intuitive Surgical, ResMed, Revvity, STERIS, Teleflex, The Cooper Companies, Waters, Zimmer Biomet; Hologic positioned near 55th percentile of revenue peers . Pearl Meyer served as independent compensation consultant; program assessed for risk and competitiveness .
Equity Award Detail (Outstanding at FY2024 Year-End)
| Category | Count/Terms |
|---|---|
| Options Exercisable | 1,956 @ $40.97 (11/12/2028); 4,526 @ $45.61 (11/11/2029); 5,628 @ $68.35 (to 11/9/2030); 5,943 @ $71.13 (to 11/8/2031) |
| Options Unexercisable | 1,877 @ $68.35; 5,944 @ $71.13; 8,697 @ $74.35; 25,070 @ $71.94 (11/14/2033) |
| RSUs Unvested | 8,687 (11/14/2023 grant) |
| PSUs (target) | 2022 cycle settled at 146%/200%/160% (FCF/ROIC/TSR) company-wide; 2024 cycle targets outstanding as noted above |
Note: Market value references in proxy used $80.82 closing price on 9/27/2024 for award valuations .
Employment Policies & Governance
- Ownership guidelines: 3x base for NEOs within 5 years; “all NEOs subject for five years” are above guideline (Mitchell became NEO in 2023) .
- No hedging/pledging; no option repricing without shareholder approval .
- Clawback: Nasdaq-compliant, with mandatory recoupment on restatements and discretionary recoupment on fraud/willful misconduct .
Investment Implications
- Alignment and retention: High variable pay mix (PSUs/RSUs/options) and 3-year PSU cliffs create strong multi-year alignment; double‑trigger CoC and one-year severance reduce flight risk but elevate potential CoC cash/equity outflows ($8.45M modeled) .
- Near‑term supply from vesting: FY2024 grants (11/14/2023) create FY2025–FY2026 RSU tranches and a PSU cliff in late 2026; FY2021/2022 PSU over‑target vesting evidences performance realization and possible incremental share delivery; monitor 10b5‑1 plans/tax‑withholding related sales around vest dates .
- Performance focus: STIP/PSU metrics (Adj. Revenue/EPS; FCF/ROIC/TSR) align with cash generation and returns; continued emphasis on FCF (50% PSU weighting) favors capital deployment capacity (M&A/buybacks) .
- Governance quality: Shareholder‑friendly constructs (no hedging/pledging, clawback, no repricing, double‑trigger) and improving say‑on‑pay support mitigate governance risk and support investor confidence in pay practices .
Sources: Hologic 2025 Proxy (DEF 14A) and SEC filings as cited throughout.