Philip Hawkins
Executive Vice President, Chief Operating Officer at MGRC
Executive
About Philip B. Hawkins
Philip B. Hawkins, age 49, is Executive Vice President and Chief Operating Officer (COO) of McGrath RentCorp, appointed January 13, 2025, after leading the Mobile Modular businesses; he joined McGrath in 2004 via the TRS acquisition and holds B.S. degrees in Accounting, Finance, and Computer Information Systems from Arizona State University . Company performance underpinning his incentives: 2024 revenue and Adjusted EBITDA both grew 10% despite Portable Storage and TRS-RenTelco demand headwinds and a terminated merger process , while his 2022–2024 PSU cycle paid out at 200% based on ROIC and revenue goals . For broader context, MGRC’s cumulative TSR measured as year-end value of $100 invested since 12/31/2019 was $162.65 at 12/31/2024, with net income of $231.7M and pre-tax income of $313.6M for 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| McGrath RentCorp | SVP & Division Manager, Mobile Modular | Jan 2022 – Jan 2025 | Oversaw Enviroplex and Kitchens to Go; led modular growth initiatives |
| McGrath RentCorp | VP & Division Manager, Mobile Modular | 2011 – 2021 | Led Mobile Modular division operations and growth |
| McGrath RentCorp | VP & Division Manager, TRS-RenTelco | 2007 – 2011 | Managed TRS-RenTelco division |
| McGrath RentCorp | Manager, Corporate FP&A | Jun 2004 – Jun 2007 | Corporate planning/analysis post-TRS acquisition |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CIT Technologies (TRS) | Senior Business Analyst, Technology Rentals & Services (TRS) | Through 2004 (pre-acquisition) | Analytics/finance leadership at TRS prior to integration into McGrath |
| Dell Financial Services | Leadership roles (finance/operations) | Not disclosed | Built foundation in finance and operations |
Fixed Compensation
| Item | 2024 | 2025 | Notes |
|---|---|---|---|
| Base Salary ($) | $450,000 | $500,000 (post-promotion to COO) | Merit/market alignment; promotion effective Jan 13, 2025 |
| Target Bonus (% of Base) | 60% | Not disclosed | NEO-specific targets set by Comp Committee |
| Target Bonus ($) | $270,000 | Not disclosed | Plan structure detailed below |
Multi-year compensation summary:
| Year | Salary ($) | Bonus ($) | Stock Awards ($) | Non-Equity Incentive ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2024 | $450,000 | $40,000 (discretionary) | $499,600 | $444,434 | $42,364 | $1,476,398 |
| 2023 | $380,000 | — | $410,784 | $363,546 | $43,613 | $1,197,943 |
| 2022 | $350,000 | — | $325,000 | $209,167 | $30,999 | $915,166 |
Performance Compensation
2024 annual incentive mechanics and payout:
| Component | Weighting | Metric | Target | Actual | Payout % | Payout $ |
|---|---|---|---|---|---|---|
| Profitability (Mobile Modular) | 90% of profitability | Adjusted EBITDA | $211,293,000 | $229,160,000 | 184.60% | Included in combined profitability below |
| Profitability (Enviroplex) | 10% of profitability | Division EBIT | $3,024,000 | $4,402,000 | 200.00% | Included in combined profitability below |
| Combined Profitability component | 75% of total bonus | Weighted (90% EBITDA, 10% EBIT) | — | — | 186.10% | $376,934 |
| Personal Annual Priorities | 25% of total bonus | Execution priorities | 100% | 100% | 100.00% | $67,500 |
| Total Annual Cash Bonus | — | — | Target $270,000 | — | 164.6% of target | $444,434 |
Long-term equity incentives and vesting:
| Grant Type | Grant Date | Target LTI ($) | Units Granted | Fair Value ($) | Vesting |
|---|---|---|---|---|---|
| Time-based RSUs (2024 grant) | Feb 23, 2024 | $500,000 | 4,000 | $499,600 | 33% on 2/23/2025; 33% on 2/23/2026; 34% on 2/23/2027 |
| PSUs (2022 grant) | Feb 25, 2022 | Not disclosed | 2,000 target; 4,000 earned (200%) | Not disclosed | Cliff vest at end of 3-year period; vest date 2/25/2025 |
| PSUs (2023 grant) | Feb 24, 2023 | Not disclosed | 1,970 unearned at 12/31/2024 | $220,285 market value at 12/31/2024 | Cliff vest 2/24/2026, subject to performance |
| RSUs (2022 grant, unvested at FY-end) | Feb 25, 2022 | Not disclosed | 667 unvested | $74,584 market value at 12/31/2024 | Vest schedule includes 2/25/2025 |
| RSUs (2023 grant, unvested at FY-end) | Feb 24, 2023 | Not disclosed | 1,314 unvested | $146,931 market value at 12/31/2024 | Vest schedule includes 2/24/2025, 2/24/2026 |
PSU performance metrics and structure:
- For PSU cycles, awards are earned based on three-year corporate ROIC targets and revenue targets, equally weighted; 2022–2024 cycle achieved 200% for Hawkins (4,000 units) .
Plan design guardrails and policies:
- No single-trigger CoC severance payments; capped incentives; clawback policy compliant with Nasdaq Rule 10D-1; no hedging/pledging; no tax gross-ups; time-based and performance-based equity with multi-year vesting .
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficial ownership (shares) | 24,829 as of April 17, 2025 |
| Shares outstanding | 24,611,329 as of April 17, 2025 |
| Ownership as % of outstanding | ~0.10% (24,829 / 24,611,329) |
| Unvested RSUs (market value at 12/31/2024) | 667 ($74,584) [2022]; 1,314 ($146,931) [2023]; 4,000 ($447,280) [2024] |
| Unearned PSUs (market value at 12/31/2024) | 4,000 (2022 PSU, $447,280); 1,970 (2023 PSU, $220,285) |
| Stock ownership guidelines (effective Feb 14, 2025) | 2× base salary for executive officers; 5-year compliance; 50% holdback of net, after-tax shares until guideline met; determination based on vested RSUs/PSUs (unvested RSUs and vested options excluded) |
| Hedging/pledging | Prohibited by Insider Trading Policy and risk-hedging policy |
Note: No stock options outstanding for Hawkins in 2024; option tables list “—” for Hawkins .
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment agreement | McGrath does not use executive employment agreements; severance governed by plan documents |
| Severance (Amended Severance Plan, Feb 2025) | If terminated without cause prior to CoC or after 24 months following CoC: 18 months base salary + 150% of target annual cash bonus; COBRA up to 18 months; prorated vesting of RSUs and PSUs at target; outplacement |
| CoC severance (double trigger, within 24 months post-CoC) | 24 months base salary + 200% of target annual cash bonus; COBRA up to 24 months; 100% vesting of RSUs and PSUs at target; outplacement |
| 2024 RSU special CoC term | 2024 time-based RSUs accelerate upon termination without cause or resignation for good reason within 12 months after a CoC (award agreement) |
| Equity plan acceleration | Full acceleration if awards not assumed/replaced in CoC; PSUs vest at target/prorated if CoC precedes performance determination (2022, 2023 cycles per award terms) |
| Clawback | Restatement-based recoupment of incentive pay (cash and equity) for past 3 years; amended in 2023 to comply with Nasdaq/Rule 10D-1 |
| Equity grant policy | Single annual grant date post year-end blackout; executive grants only via Comp Committee; grant price equals Nasdaq close price on grant date |
| Perquisites/tax | No special executive perquisites; no tax gross-ups; retiree health access only after 10 years with 100% premium paid by retiree |
| Insider trading | Revised policy adopted Feb 14, 2025; prohibits trading on MNPI and bars hedging, pledging, short sales, derivatives, margin purchases; includes blackout/6-month opposite-trade restriction |
Investment Implications
- Pay-for-performance alignment is strong: Hawkins’ 2024 bonus was driven 75% by profitability and 25% by priorities, with division EBITDA/EBIT targets materially exceeded (184.6% and 200%), yielding 165% of target payout; the 2022–2024 PSU cycle vested at 200% on three-year ROIC and revenue goals .
- Near-term vesting cadence may create supply: February 2025 carries three vest dates—2024 RSUs (33%), 2023 RSUs (annual tranche), and 2022 RSUs (final tranche)—plus 2022 PSUs (cliff vest), increasing the potential for insider selling pressure; mitigants include a 50% holdback until guideline met and a no-hedge/no-pledge policy .
- Retention risk appears contained under current severance economics: Amended Severance Plan raises cash severance and enhances equity treatment (prorated/target vesting outside CoC; 100% target vesting within 24 months post-CoC), supporting management continuity while preserving double-trigger discipline (no single-trigger cash severance) .
- Governance and shareholder-friendly policies reduce red flags: No repricing; no tax gross-ups; comprehensive clawback; say-on-pay support >95% historically (97% in 2024); prohibition on hedging/pledging; no related-party transactions in 2024 .