Katherine Lane
HUBBELLAbout Katherine Lane
Katherine A. Lane is Senior Vice President, General Counsel and Secretary of Hubbell Incorporated and is one of the company’s Named Executive Officers (NEOs) . She serves as corporate secretary and signatory on SEC filings (e.g., Item 5.02 8‑K) . Hubbell’s 2024 performance delivered net sales of $5.6B, adjusted diluted EPS of $16.57, and free cash flow of $811M, which underpin the pay‑for‑performance framework used to evaluate Lane’s incentives . Long‑term performance shares for the 2022–2024 cycle paid out at 200% across all three metrics (relative sales growth, adjusted operating profit margin, and relative TSR), evidencing strong execution during the period .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $506,923 | $526,923 | $547,008 |
| STI Target % of Salary | — | — | 75% |
| Non‑Equity Incentive (STI) Paid ($) | $617,600 | $735,400 | $462,000 |
| One‑Time Bonus ($) | $100,000 (transaction contribution) | — | — |
Notes:
- 2022 one‑time cash bonus was paid to Lane for significant contribution to the disposition of the commercial and industrial lighting business .
- STI target percentages are explicitly disclosed for 2024; other years not disclosed.
Performance Compensation
Short‑Term Incentive (STI) – 2024 Design and Results
| Metric | Target | Performance vs Target | Payout % |
|---|---|---|---|
| Adjusted EPS | $16.35 | 102% | 115% |
| Free Cash Flow | $793M | 101% | 107% |
| Strategic Objectives (4 pillars) | — | — | 110% |
| Composite Payout (Enterprise Financials) | — | — | 112% |
STI structure for NEOs: 80% financial (Adjusted EPS, FCF) and 20% strategic objectives across Serve Customers, Grow the Enterprise, Operate with Discipline, Develop Our People .
Long‑Term Incentive (LTI) Structure
| Component | Weight | Vesting/Measurement | Metric Details |
|---|---|---|---|
| Performance Shares (PSUs) | 50% | 3‑yr cliff; 2024–2026, 2023–2025, 2022–2024 | Metrics: Relative Sales Growth (34%), Adjusted Operating Profit Margin (33%), Relative TSR (33%) |
| Stock Appreciation Rights (SARs) | 25% | 1/3 per year over 3 years; base price $352.55 for 2/6/24 grants | Value delivered by stock price appreciation |
| Restricted Stock (RS) | 25% | 3‑year cliff vesting | Retention‑oriented equity |
2022–2024 PSU payout (completed period):
| Metric | Weight | Target | Actual | Payout |
|---|---|---|---|---|
| Relative Sales Growth | 34% | 50th percentile | 76th percentile | 200% |
| Adjusted Operating Profit Margin | 33% | 15.25% | 21.9% | 200% |
| Relative TSR | 33% | 50th percentile | 124.5% | 200% |
| Total | 100% | — | — | 200% |
Lane’s shares earned from the 2022 grant (projected as of March 24, 2025):
| Grant | Target Shares | Projected Shares |
|---|---|---|
| Feb 2022 PSU grant | 2,287 | 4,574 |
Equity Ownership & Alignment
Beneficial Ownership (as of March 7, 2025)
| Holding | Amount |
|---|---|
| Common Stock | 11,934 shares |
| Shares Obtainable on Exercise (SARs) | 34,250 shares |
| Total Beneficial Ownership | 46,184 shares |
| Shares Outstanding (context) | 53,573,359 shares |
Stock ownership policy compliance: All executive officers, including NEOs, are in compliance with ownership guidelines; hedging and pledging of Hubbell stock are prohibited .
Outstanding Equity Awards (Lane) at 12/31/2024
Restricted Stock (unvested) and Performance Shares (unearned):
| Grant Date | RS Not Vested (#) | Market Value ($) | PS Unearned (#) | Market/Payout Value ($) |
|---|---|---|---|---|
| 2/8/2022 | 1,143 | $478,791 (at $418.89) | 2,287 | $958,001 (at $418.89) |
| 2/7/2023 | 985 | $412,607 (at $418.89) | 1,970 | $825,213 (at $418.89) |
| 2/6/2024 | 780 | $326,734 (at $418.89) | 1,560 | $653,468 (at $418.89) |
Stock Appreciation Rights (SARs):
| Grant Date | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration |
|---|---|---|---|---|
| 12/14/2018 | 2,868 | — | 105.49 | 12/14/2028 |
| 7/1/2019 | 8,118 | — | 129.28 | 7/1/2029 |
| 2/13/2020 | 7,417 | — | 149.49 | 2/13/2030 |
| 2/10/2021 | 6,796 | — | 163.26 | 2/10/2031 |
| 2/8/2022 | 3,609 | 1,805 | 185.87 | 2/8/2032 |
| 2/7/2023 | 1,298 | 2,596 | 241.17 | 2/7/2033 |
| 2/6/2024 | — | 3,124 | 352.55 | 2/6/2034 |
2024 exercises/vestings:
- SARs exercised: 3,325 shares; value realized $758,920
- RS vested: 1,225 shares; value realized $441,527
- Performance shares vested: 4,801 shares; value realized $1,738,861
Employment Terms
Severance, CIC, and Equity Treatment
| Provision | Term |
|---|---|
| Employment Agreements | None; no NEO employment agreements |
| Senior Severance Policy | 4 weeks base salary per year of service (min 26 weeks, max 78); continued benefits during continuation; pro‑rated target STI; up to 12 months outplacement |
| CIC Agreements (double trigger) | Lane multiple: 2.0x base salary + 2.0x target bonus; continued benefits (2 years); pro‑rated target STI; outplacement up to 12 months (≤15% salary or $50k) |
| Equity on CIC | RS/SARs generally assumed/continue; full vest only upon qualifying termination within 12 months post‑CIC; PS subject to Committee discretion |
| Clawback Policy | Adopted 2023; recovery of erroneously awarded incentive comp over prior 3 years after a required restatement |
| Hedging/Pledging | Prohibited for officers, Directors, designated employees and related persons |
Scenario values as of 12/31/2024 (Lane):
| Scenario | Severance ($) | Equity Accelerated ($) | Welfare/Other ($) | Total ($) |
|---|---|---|---|---|
| Death | — | $4,744,022 | — | $4,744,022 |
| Disability | — | $4,744,022 | — | $4,744,022 |
| Involuntary Termination | $1,004,812 | — | $59,464 | $1,064,276 |
| CIC + Involuntary Termination | $1,267,240 | $4,744,022 | $70,292 | $6,081,554 |
Deferred Compensation and Benefits (2024)
| Item | Amount |
|---|---|
| EDCP Executive Contributions | $978,042 |
| DC Restoration Plan – Registrant Contributions | $57,017 |
| Aggregate Balance (EDCP + DC Restoration) at 12/31/2024 | $1,599,360 |
| Perquisites (financial/tax planning; aircraft use) | $15,496 |
| Retirement Plan Contributions | $88,549 |
Compensation Structure Analysis
- Pay mix remains performance‑oriented: 75% of equity awards are performance‑based, balanced by SARs and RS to link incentives to shareholder outcomes and retention .
- STI remains predominantly financial, with a structured strategic objectives overlay; 2024 payouts on EPS and FCF modestly exceeded target (112% blended), while strategic objectives paid at 110% .
- LTI metrics have been consistent since 2022; 2022–2024 PSU cycle paid at 200% on all metrics, signaling robust value creation relative to peers and internal margin targets .
- Governance controls: robust clawback policy and prohibitions on hedging/pledging mitigate misalignment risks .
Say‑on‑Pay & Shareholder Feedback
- 2024 Say‑on‑Pay approval: 95.1% of votes cast; ~92.5% average support over last 10 years .
- Ongoing shareholder outreach (top 25 holders; >61% of outstanding) informed Compensation Committee’s design and affirmed support .
Equity Plan and Dilution Context
- Shareholders are asked to approve the Hubbell Incorporated Incentive Award Plan; additional 620,000 shares requested, increasing total available to 1,749,789 shares as of March 7, 2025 .
- If fully issued, incremental dilution of ~3.2% on a fully diluted basis (based on shares outstanding) .
- Historical conservative burn rates (FY2022–FY2024 value‑adjusted 0.25–0.31%) versus ISS Capital Goods benchmark (0.77%) .
Investment Implications
- Pay‑for‑performance alignment: LTI framework tied to relative growth, margins, and TSR with demonstrably high payout for 2022–2024; supports confidence in continued operational discipline and shareholder value orientation .
- Insider supply dynamics: 2024 exercises/vestings (SARs 3,325; PS 4,801; RS 1,225) reflect regular program mechanics; no hedging/pledging permitted, and policy‑mandated retention supports alignment .
- Retention and transition: absence of employment agreements is offset by standard severance and double‑trigger CIC protections (2.0x salary/bonus for Lane) and retirement/vesting provisions; mitigates retention risk without over‑guaranteeing pay .
- Governance and shareholder support: strong Say‑on‑Pay results and structured shareholder engagement reduce compensation controversy risk; majority voting adoption further enhances governance quality .
Notable achievement: Lane received a one‑time bonus in 2022 for her significant role in the lighting business divestiture, highlighting transactional execution capability .