Michael Guhde

About Michael Guhde

Michael Guhde is Senior Vice President and President, Connect & Control Technologies (CCT) at ITT, a role he has held since February 2024. He previously served as Vice President and General Manager at Illinois Tool Works (ITW) from June 2018 to February 2024 and spent more than twenty years at Parker Hannifin in general manager, global sales, and operations roles; he holds a B.S. in Mechanical Engineering from Ohio University . Company performance under ITT’s current leadership includes strong TSR and profitable growth: a 230% TSR through September 30, 2024 vs. 153% for the S&P 500 and 105% for the S&P 400, with revenues exceeding $3B and expanded adjusted margins and EPS since 2020 . Guhde’s CCT segment has driven defense and connectivity wins, including U.S. Army Nett Warrior qualification for Cannon connectors with an estimated ~$40M total addressable market annually, underscoring execution on growth vectors in defense interconnects .

Past Roles

Fixed Compensation

• Specific base salary, target bonus %, and actual bonus paid for Michael Guhde are not disclosed in ITT’s proxies. The executive pay architecture for senior leaders consists of base salary, an Annual Incentive Plan (AIP) with financial and individual metrics, and long-term equity in PSUs/RSUs .

Performance Compensation

AIP Design and 2024 Weightings

• 2024 AIP metrics and weightings: Adjusted EPS (20%), Adjusted Operating Margin (20%), Free Cash Flow (25%), Organic Revenue (20%), Individual/Team Goals (15%); AIP payout range 0–200% of target .

2024 Corporate Targets, Actuals, and Payouts

Long-Term Incentives (LTI)

• Mix: 60% PSUs and 40% RSUs for annual awards; PSUs equally weighted to three-year relative TSR and ROIC, with 0–200% payout range; RSUs support retention and align to absolute share price . PSUs generally settle after a three-year performance vesting period; delivery typically requires employment throughout the period .

Equity Ownership & Alignment

• Executive stock ownership guidelines: Senior Vice Presidents must hold company stock equal to 3x annual base salary (five-year compliance period); unvested PSUs do not count toward compliance .
• Hedging/pledging prohibited; Rule 10b5-1 plans permitted under strict conditions .
• As of February 1, 2025, “No directors or executive officers have pledged any shares of common stock” .
• Baseline filing: On February 27, 2024, Michael Guhde filed a Form 3 indicating “No securities are beneficially owned” at the time of his appointment .

Employment Terms

• Severance Plan: Provides cash severance (dependent on base pay and service, up to two times prior-year annual compensation), six months of healthcare eligibility, and one year outplacement; severance ceases for cause or non-compliance with Code of Conduct/non-competition provisions; offsets apply if other compensation is received; payments start within 60 days of termination .
• Change-in-Control (CIC) Plan: Two levels of benefits by position (CEO/SVPs higher level; certain VPs second level). If terminated within two years of a CIC or resigns for good reason within two years post-CIC, benefits include: accrued compensation; two or three times current base salary and target AIP; a lump sum equal to two or three times the highest annual base rate over the prior three years times the highest company retirement plan contribution rate (capped at 7% per year); six months of subsidized healthcare; one year outplacement. Equity follows double-trigger vesting—no automatic vest upon CIC .
• Clawback: SEC-compliant “no-fault” clawback for restatement due to material noncompliance and recoupment where fraud/willful misconduct contributed to a material restatement .
• No tax gross-ups: Company policy prohibits tax gross-ups, except for international assignment or relocation .

Performance & Track Record

• Defense programs: ITT Cannon connectors qualified for U.S. Army Nett Warrior, with ~$40M annual TAM, reinforcing CCT differentiation in defense modernization platforms; Guhde emphasized rapid, customized solutions and competitive speed-to-value .
• Strategic focus: Leadership materials highlight defense connectors, embedded VSD motors (VIDAR) in industrial markets, and 2030 targets (>5% organic revenue CAGR base business; ~10% with M&A; adjusted EBITDA margin >25%; free cash flow margin 14–15%) .

Company Financial Performance (Context)

Values with asterisks retrieved from S&P Global.

Compensation Structure Analysis

• Increased emphasis on performance-based pay: Only 14–33% of NEO target compensation is fixed; the remainder is performance-linked across short- and long-term horizons .
• Shift to RSUs/PSUs: ITT no longer grants options and emphasizes PSUs (relative TSR/ROIC) and RSUs for retention and alignment; double-trigger CIC equity vesting mitigates windfall risks .
• Governance safeguards: No hedging/pledging, robust clawback, ownership guidelines, and independent compensation consultant engagement .

Investment Implications

• Alignment: Strong pay-for-performance architecture (AIP tied to EPS, margin, FCF, and organic revenue; LTI linked to TSR/ROIC) and 3x salary ownership guideline for SVPs indicate high alignment of incentives with shareholder value creation .
• Retention risk: CIC protection with double-trigger equity vesting and two/three-times cash multiples reduces turnover risk; severance cessation for non-compete/Code violations strengthens behavioral discipline .
• Trading signals: Form 3 baseline showed no initial holdings; we did not find disclosed Form 4 transactions for Guhde in our document search window, limiting read-through on insider selling pressure; hedging/pledging prohibitions and broad “no pledging” statement lower misalignment concerns .
• Execution: Documented program wins (U.S. Army) and segment priorities under Guhde’s leadership support CCT growth narratives, especially in defense and high-spec interconnects, with favorable cash/return profile benefits reflected in AIP and long-term metrics .

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