Nick Randall
FreightCar AmericaAbout Nick Randall
Nicholas J. Randall, 51, is President and CEO since May 1, 2024 and joined RAIL as Chief Operating Officer on June 26, 2023; he has served on the Board since May 2024 and holds a BEng in manufacturing engineering from Liverpool John Moores University . 2024 annual incentive metrics were tied to adjusted EBITDA, sales, operating cash flow, and safety, with a payout factor of 139.7% of target; as CEO his target bonus is 100% of base, max 200%, and LTIP target is 150% of base . He received time-based restricted shares and options in 2024 with additional promotional grants upon becoming CEO; unvested RSUs vest in 2027 and options vest in equal annual installments beginning in 2024–2025 . Company policies include clawback, anti-hedging/anti-pledging, and no option repricing or tax gross-ups under 280G, mitigating governance risk around incentive design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Precision Castparts Corporation | Division leader | 2017–2023 | Operations leadership in industrial products; brings manufacturing and execution expertise |
| Alcoa Corporation / Arconic Corporation | Various capacities (post-2016 split) | 2007–2017 | Metals/industrial experience across transformation period; operational insight from large-cap industrials |
| Jaguar Land Rover Automotive | Engineering roles | Prior to 2007 | Automotive engineering background; grounding in complex supply chain and quality systems |
External Roles
- No other public company board service disclosed for Randall in the proxy .
Board Governance and Director Service
- Board service: Class III director since May 2024; term expires at the 2026 annual meeting .
- Committees: No committee memberships noted for Randall; other directors are assigned to Audit, Compensation, and Nominating .
- Attendance: The Board met 8 times in 2024; each director then serving attended at least 75% of Board and committee meetings and the 2024 annual meeting .
- Dual-role implications: CEO serving on the Board is offset by governance safeguards—Compensation Committee consists of independent directors, meets without senior management for CEO compensation decisions, and a Lead Independent Director role was instituted with an additional retainer in May 2024 .
Fixed Compensation
| Component | 2024 Value | Notes |
|---|---|---|
| Base salary (CEO rate) | $550,000 | Increased from $450,000 effective May 1, 2024 upon promotion |
| Salary earned (calendar 2024) | $516,666 | As disclosed in Summary Compensation Table |
| Target annual bonus % | 100% of base | Maximum 200% of base as CEO |
| LTIP target | 150% of base | Under the 2022 LTIP |
| Sign-on cash bonus | $250,000 | Per offer letter dated May 12, 2023 |
| 2024 Stock awards (RS) grant-date fair value | $450,481 | ASC 718 methodology |
| 2024 Option awards grant-date fair value | $450,487 | Black-Scholes methodology |
| All other compensation | $122,512 | Includes $106,312 relocation reimbursements |
| Total compensation | $2,298,035 | Summary Compensation Table |
Performance Compensation
| Metric | Weighting | Target | Actual Achievement | Payout Component | 2024 Payout Timing |
|---|---|---|---|---|---|
| Adjusted EBITDA | 31.7% | Not disclosed | 190% of goal | Contributed to overall 139.7% of target payout | 2024 annual incentive |
| Sales goals | 31.7% | Not disclosed | 20% of goal | Contributed to overall 139.7% of target payout | 2024 annual incentive |
| Operating cash flow | 31.7% | Not disclosed | 200% of goal | Contributed to overall 139.7% of target payout | 2024 annual incentive |
| Safety goals | 5.0% | Not disclosed | 200% of goal | Contributed to overall 139.7% of target payout | 2024 annual incentive |
| Non-equity incentive paid (CEO) | — | — | — | $757,889 | 2024 |
| Equity Incentive Type | Grant Date | Quantity | Vesting | Notes |
|---|---|---|---|---|
| Annual RS (time-based) | Jan 4, 2024 | 103,022 | Vests fully Jan 4, 2027 | Market value $923,077 at $8.96 close on 12/31/24 |
| Promotional RS (time-based) | May 1, 2024 | 48,077 | Vests fully May 1, 2027 | Market value $430,770 at $8.96 close on 12/31/24 |
| Annual options | Jan 4, 2024 | 49,266 exercisable / 103,022 unexercisable | 3 equal annual installments starting Jan 4, 2025 | Exercise price $2.73; exp. 1/4/2034 |
| Promotional options | May 1, 2024 | 67,619 unexercisable | 3 equal annual installments starting May 1, 2025 | Exercise price $3.52; exp. 5/1/2034 |
| Sign-on options (performance met in 2024) | Jun 26, 2023 | 100,000 exercisable / 200,000 unexercisable | 3 equal annual installments starting Jun 26, 2024 | Exercise price $2.73; exp. 6/26/2033 |
- Long-term mix: January 2024 awards split ~50% RS and ~50% options; promotional grants in May 2024 mirrored annual award conditions .
Equity Ownership & Alignment
| Ownership Item | Amount | Detail |
|---|---|---|
| Beneficial ownership | 369,632 shares | <1% of class; includes holdings as defined by SEC within 60 days of the Record Date |
| Unvested RS | 103,022 | Vests Jan 4, 2027 |
| Unvested RS | 48,077 | Vests May 1, 2027 |
| Options exercisable | 149,266 | 100,000 at $2.73 exp. 6/26/2033; 49,266 at $2.73 exp. 1/4/2034 |
| Options unexercisable | 370,641 | 200,000 at $2.73 exp. 6/26/2033; 103,022 at $2.73 exp. 1/4/2034; 67,619 at $3.52 exp. 5/1/2034 |
| Stock price reference | $8.96 | Nasdaq close on 12/31/24 used for RS market value |
| Pledging/Hedging | Prohibited | Insider Trading Policy prohibits hedging and pledging; margin accounts also prohibited |
| Ownership guidelines | In place | Guidelines applicable to officers and directors; director guideline is 3x cash retainer (non-employee) |
Note: At the $8.96 close on 12/31/24, the closing price exceeds option strike prices of $2.73 and $3.52, indicating these awards were in-the-money at that reference date .
Employment Terms
- Offer letter: May 12, 2023; appointed COO on June 26, 2023; promoted to President & CEO effective May 1, 2024 .
- Compensation terms: CEO base $550,000; target and max bonus 100%/200% of base; LTIP target 150% of base; sign-on award 300,000 stock options subject to performance and service vesting; sign-on cash $250,000; relocation expense reimbursement .
- Term: No specified term; eligible for Company benefit plans; participant in Executive Severance Plan from start date .
- Restrictive covenants: Confidentiality/IP assignment; non-compete and customer non-solicit for one year post-termination; employee non-solicit for two years .
- Executive Severance Plan highlights:
- Change in Control: If not retained by the successor on substantially comparable aggregate terms, termination qualifies as resignation for Good Reason, making the participant eligible for severance; otherwise, no special severance solely due to a Change in Control .
- Qualifying Retirement: Outstanding equity continues to vest as if in service; performance-vesting awards only vest upon achievement; options/SARs remain exercisable until the earlier of original expiration or the 10th anniversary of grant .
- Clawback: 2023 policy compliant with Section 10D (Exchange Act/Nasdaq) for recovery upon restatement; incentive equity awards include forfeiture/clawback in case of restrictive covenant breach .
- Insider Trading Policy: Preclearance required; prohibits hedging, pledging, short sales, and long-duration standing orders; restrictions on margin accounts .
Compensation Committee and Director Compensation Context
- Compensation Committee: Uses Meridian Compensation Partners as independent consultant (engaged Sep 2023); reviews/approves executive comp, employment/severance arrangements; meets without senior management when deliberating CEO compensation .
- Non-employee director compensation: Annual cash retainer $55,000 and annual RS $75,000; committee chair retainers: Audit $15,000; Compensation $10,000; Nominating $10,000; Chairman retainer $70,000; Lead Independent Director retainer $15,000 (effective May 14, 2024); director stock ownership guideline = 3x cash retainer .
Compensation Structure Analysis
- Pay-for-performance linkage: Annual cash incentive metrics calibrated to budget/business plan; 2024 payouts approved at 139.7% of target reflecting strong EBITDA and cash flow vs modest sales performance .
- Mix and risk: Shifted to time-based RS and options (50/50) in 2024; option awards and prior SARs align pay with shareholder value increases; equity plans prohibit repricing; no tax gross-ups for CiC payments per policy .
- Market alignment: CEO base increased to $550,000 in May 2024 to better align with market benchmarks; Meridian provided peer benchmarking support .
Risk Indicators & Red Flags
- Governance mitigants: Clawback policy; anti-hedging/anti-pledging; independent Compensation Committee; no repricing/exchanges of equity awards; no 280G tax gross-ups; say-on-pay presented annually with Board recommendation to vote FOR .
- Capital/board dynamics: Investor rights and warrant agreements grant board nomination rights to major stakeholders (MX Sellers and lender), indicating concentrated governance influences that investors should monitor .
Investment Implications
- Alignment: Randall’s significant unvested RS and multi-tranche options create strong equity alignment; with $8.96 close on 12/31/24 above $2.73 and $3.52 strikes, options are in-the-money at that reference point, potentially increasing realized pay sensitivity to stock performance .
- Vesting/selling windows: Option vesting began in 2024 and continues through 2026–2027; RS vest in 2027—expect periodic 10b5-1 activity and possible selling pressure around vest dates, subject to strict insider policy preclearance and blackout restrictions .
- Retention/Severance: Executive Severance Plan provides protection upon non-comparable retention post-CiC (Good Reason) and favorable retirement vesting treatment—reduces retention risk but can accelerate equity realization in certain scenarios .
- Governance balance: CEO-board dual role is counterbalanced by an independent Compensation Committee and presence of a Lead Independent Director; continued monitoring of board composition given stakeholder nomination rights is warranted .