Tom Surran
RESIDEO TECHNOLOGIESAbout Tom Surran
Tom Surran, 62, is President, Products & Solutions at Resideo (REZI). He was appointed on December 5, 2023 after serving as COO and President of Commercial Systems at FLIR Systems, and earlier as CFO of FLIR’s Commercial Systems division; he holds a B.S. from Xavier University and an MBA from the University of Chicago . In 2024, Resideo delivered net revenue of $6.761B (+8.3% YoY), gross margin of 28.1% (+90 bps), and cash from operations of $444M, while Products & Solutions increased income from operations by $57M (+12.8%), reflecting structural margin improvements and operating efficiency . Company TSR since 2019 rose to $193 on a $100 base (S&P 600 at $138), underscoring long-term value creation, and operating income margin in 2024 was 7.7% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| FLIR Systems, Inc. | Chief Operating Officer | 2014–2017 | Led global operations of imaging/sensing tech; operational execution across manufacturing and supply chain . |
| FLIR Systems, Inc. | President, Commercial Systems | 2013–2014 | Drove commercial portfolio growth and integration of product lines . |
| FLIR Systems, Inc. | CFO – Commercial Systems Division | 2009–2013 | Financial leadership for division; cost and capital efficiency . |
Fixed Compensation
| Component | 2024 Value | Notes |
|---|---|---|
| Base Salary | $565,000 | No increase from 2023 . |
| Target Bonus % | 100% of base | Annual incentive tied to Net Revenue (constant FX) and Operating Income Margin . |
| Actual Annual Incentive Paid | $771,790 | Financial performance payout 136.6% based on segment + company metrics . |
| LTI Target (Annual) | $2,000,000 | 50% RSUs, 50% PSUs (rTSR vs S&P 600 over 3 years) . |
| Special RSU (Retention) | $3,000,000 (Feb 2025) | Vests 50% on each of 3rd and 4th anniversary; no retirement continuation; retention-focused . |
| Perquisites (2024) | $77,089 | Includes $46,385 commuting reimbursements (CA↔AZ HQ) approved Dec 2023 . |
Performance Compensation
| Metric (Weighting) | Threshold | Target | Maximum | Actual | Payout % | Notes |
|---|---|---|---|---|---|---|
| Products & Solutions: Net Revenue (50%) | $2,306M | $2,562M | $2,818M | $2,582M | 108% | Constant currency . |
| Products & Solutions: Operating Income Margin (50%) | 15.4% | 18.1% | 20.8% | 20.2% | 180% | Adjustments per plan; strong margin execution . |
| Total Company: Net Revenue (50%) | $5,886M | $6,540M | $7,194M | $6,596M | 109% | Constant currency; Snap One integrated . |
| Total Company: Operating Income Margin (50%) | 7.5% | 8.8% | 10.1% | 9.5% | 150% | Adjusted for unusual items . |
| Weighted Payout (Surran formula) | — | — | — | — | 136.6% | 50% P&S metrics + 50% Total Company . |
PSU Design and Outcomes:
- 2024 PSU program: 3-year rTSR vs S&P 600; Threshold 25th percentile=50% payout, Target 55th=100%, Max 75th=200%; linear interpolation .
- 2022 PSU cohort payout: 59.62% based on rTSR rank 46/66 in S&P 400 Industrials (performance period ended Dec 31, 2024) .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 19,004 common shares (direct/indirect) . |
| Ownership % of Outstanding | ~0.013% (19,004 / 148,493,879 shares) . |
| Options Held | None disclosed; equity is RSUs/PSUs . |
| Unvested Awards (12/31/2024) | RSUs: 19,712 (12/5/2023) + 58,788 (2/5/2024); PSUs: 58,788 (2/5/2024); Total market value $3,164,488 at $23.05/share . |
| Vesting Schedules | 12/5/2023 RSUs: vest 50% on 12/5/2025 and 50% on 12/5/2026 ; 2/5/2024 RSUs: vest annually on 2/5/2025, 2/5/2026, 2/5/2027 ; 2/5/2024 PSUs: rTSR performance to 12/31/2026, settle Feb 2027 . |
| 2025 Special RSU (Retention) | Vests in equal increments on 3rd and 4th anniversaries from Feb 2025 grant; no retirement vesting continuation . |
| Ownership Guidelines | Execs must hold ≥3x base salary; 5-year compliance window; counted holdings include RSUs and earned PSUs; all execs compliant as of 12/31/2024 . |
| Hedging/Pledging | Prohibited for directors, officers, employees; margin accounts and pledging not permitted . |
| 2024 Vesting Activity | 9,856 shares vested for Surran; value realized $268,872 . |
Employment Terms
| Provision | Key Terms |
|---|---|
| Role & Start | President, Products & Solutions; effective Dec 5, 2023 . |
| Severance Plan | Participates in Severance Plan for Designated Officers (double-trigger CIC; non-compete/non-solicit covenants required) . |
| Termination w/o Cause (non-CIC) | Cash severance $847,500 (≈18 months base), benefits continuation $22,581; equity pro-rata vesting (per plan terms) . |
| CIC – Double Trigger (Termination) | Cash severance $1,130,000 (24 months base) + Annual Incentive for year of termination $1,130,000 + benefits $30,107; RSUs vest in full; PSUs vest at target if CIC during performance period (or actual if after period) . |
| Equity Acceleration (Death/Disability) | RSUs and options accelerate; PSUs pro-rata based on actual performance; options exercisable up to 3 years, subject to original expiry . |
| Clawback | NYSE-compliant clawback for excess incentive-based comp in event of required accounting restatement (3-year lookback) . |
| Tax Gross-Ups | Company does not provide tax gross-ups on severance/CIC payments; perquisites gross-ups limited (CEO commuting policy), not applicable to Surran . |
| Commuting & Relocation | Approved commuting reimbursements beginning Dec 2023; $46,385 reimbursed in 2024; alternative to relocation . |
Compensation Structure Notes
- Pay-for-performance: Annual incentives 100% financial (Net Revenue, Operating Income Margin), with segment-specific weighting; LTI at least 50% PSUs with 3-year rTSR; committee retained PSU weighting and added ROIC equally for 2025 (50% rTSR with negative TSR cap; 50% 3-year average ROIC) .
- Peer benchmarking: FW Cook advises; peers include AOS, AYI, ADT, ALRM, ALLE, COMM, FBIN, GNRC, ITRI, JELD, JNPR, LII, VYX, OC, PNR, WSO .
- Say-on-Pay support: 80.5% approval in 2024; ongoing shareholder engagement informed PSU design adjustments .
Investment Implications
- Strong retention alignment: A $3M special RSU grant in Feb 2025 with back-weighted vesting (years 3–4) meaningfully reduces near-term departure risk and aligns long-term execution focus in P&S; lack of retirement continuation further tightens retention .
- Incentive mix encourages margin discipline: 2024 payout was driven by outsized P&S margin performance (180% payout on segment margin, weighted outcome 136.6%), which supports continued structural improvements in product mix and cost base to sustain >20% segment margins .
- Insider selling pressure limited to RSU/PSU vesting: No options outstanding; upcoming RSU tranches in 2025–2027 and 2025 PSU settlement may add supply, but ownership guidelines and hedging/pledging prohibitions mitigate misalignment risks .
- CIC economics manageable and shareholder-friendly: Double-trigger structure, full RSU acceleration, PSUs capped at target during performance period, and no severance tax gross-ups reduce windfall risk; cash severance multiples are consistent with market (24 months base + bonus in CIC) .
- Execution track record: P&S operating income increased $57M in 2024 on lower manufacturing costs and efficiency initiatives, consistent with special award rationale emphasizing new product introductions and restructuring—supportive of multi-year value creation .