Jerry E. Gahlhoff, Jr.
ROLLINSAbout Jerry E. Gahlhoff, Jr.
President & Chief Executive Officer of Rollins, Inc. since January 1, 2023 and director since 2021; previously COO (2020–2022), President (2020–present), President of Specialty Brands and VP of Human Resources (2016–2020), and Division President (2011–2016). Joined Rollins via the HomeTeam acquisition in 2008 and is credited with driving growth initiatives; holds a Master of Science in Entomology from the University of Florida. Board roles include Zoo Atlanta (since 2023) and Culligan International (appointed 2025), plus industry leadership positions (Treasurer of the Pest Management Board of Trustees; Vice Chairman of The Professional Pest Management Association). Annual incentives are tied to revenue-to-plan and pre-tax profit-to-plan, while long-term PSUs measure three-year Revenue CAGR, three-year aggregate Adjusted EBITDA Margin, and Relative TSR versus the S&P 500; in 2023 the company delivered 14% revenue growth vs a 7.8% plan, triggering max payout on the revenue element.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Rollins, Inc. | CEO & President | 2023–present (CEO); 2020–present (President) | Separation of CEO from Board Chairs; operational leadership and growth oversight |
| Rollins, Inc. | Chief Operating Officer | 2020–2022 | Led operations scaling ahead of CEO transition |
| Rollins, Inc. | President, Specialty Brands; VP Human Resources | 2016–2020 | Built specialty brands; human capital leadership |
| Rollins, Inc. | Division President | 2011–2016 | Business unit leadership; performance execution |
| HomeTeam (acquired by Rollins) | Executive joining via acquisition | 2008 | Brought domain expertise; integration into Rollins |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Zoo Atlanta | Board Member | Since 2023 | Community engagement |
| Culligan International | Director | Appointed 2025 | Additional public board exposure |
| Pest Management Board of Trustees | Treasurer | Since 2022 | Industry stewardship |
| The Professional Pest Management Association | Vice Chairman | Since 2024 | Sector leadership |
Fixed Compensation
| Year | Base Salary ($) | Non-Equity Incentive Plan Compensation ($) | Equity Awards – RSA ($) | Equity Awards – PSU ($) | All Other Compensation ($) |
|---|---|---|---|---|---|
| 2022 | 690,000 | 759,000 | 1,188,000 | — | 42,836 |
| 2023 | 1,000,000 | 1,785,000 | 2,623,955 | 1,294,070 | 40,864 |
| 2024 | 1,045,000 | 1,457,775 | 4,176,900 | 1,520,183 | 36,891 |
- 2024 CEO salary merit increase: +4.5% to $1,045,000.
- Director compensation program applies to non-employee directors; as CEO-director, Gahlhoff’s board service is compensated via executive pay structure.
Performance Compensation
Annual Bonus Structure (Executive Bonus Plan)
| Year | Metric | Weighting | Threshold Payout | Max Payout | Notes |
|---|---|---|---|---|---|
| 2024 | Pre-Tax Profit to Plan | 90% of salary | 75% of target at 95% of plan | 125% of target at ≥105% of plan | Committee discretion for unusual items |
| 2024 | Revenue to Plan | 60% of salary | 75% of target at 95% of plan | 125% of target at ≥105% of plan | Committee discretion for unusual items |
| 2023 | Pre-Tax Profit to Plan | 90% of salary | 75% of target at 95% of plan | 125% of target at ≥105% of plan | 2023 plan replaced 2022 structure |
| 2023 | Revenue to Plan | 60% of salary | 75% of target at 95% of plan | 125% of target at ≥105% of plan | Actual: 14% YoY vs 7.8% plan → 105.7% of plan → 125% payout on revenue element |
- Actual annual bonus paid: $1,457,775 (2024); $1,785,000 (2023).
PSU Design and Targets
| Grant Year | Component | Target Shares (CEO) | Performance Window | Vesting |
|---|---|---|---|---|
| 2024 | Revenue CAGR | 12,750 | FY2023–FY2026 (CAGR defined off 2026/2023) | Cliff vest; forfeiture prior to 2/20/2027 (death/disability vest at target for CAGR/EBITDA; TSR does not vest) |
| 2024 | Adjusted EBITDA Margin (aggregate) | 12,750 | FY2024–FY2026 (aggregate EBITDA/aggregate revenue) | Cliff vest; same treatment as above |
| 2024 | Relative TSR vs S&P 500 | 12,750 | FY2024–FY2026 | Cliff vest component subject to market condition |
| 2023 | Revenue CAGR | 12,088 | FY2022–FY2025 | Cliff vest on 12/31/2025; death/disability: vest at target for CAGR/EBITDA; TSR Modifier does not vest |
| 2023 | Adjusted EBITDA Margin (aggregate) | 12,088 | FY2023–FY2025 | Cliff vest on 12/31/2025 |
| 2023 | TSR Modifier vs S&P 500 | 12,088 | FY2023–FY2025 | Cliff vest on 12/31/2025 |
- 2024 grant-date fair value: PSUs $1,520,183; RSAs $4,176,900; target cash incentive thresholds/maximums disclosed in plan-based awards table.
- 2023 grant-date fair value: PSUs $1,294,070 (Monte Carlo for TSR portion); RSAs $2,623,955.
Recent Vesting and Value Realized
| Year | Shares Vested (CEO) | Value Realized ($) |
|---|---|---|
| 2024 | 42,791 | 1,816,380 |
- No stock options outstanding or exercised by NEOs; company currently does not grant options.
Equity Ownership & Alignment
| Holder | Beneficial Ownership (Shares) | Ownership % | Notable Details |
|---|---|---|---|
| Jerry E. Gahlhoff, Jr. | 346,163 | ** | Includes 223,257 restricted shares and 1,560 shares in 401(k) |
- Executive stock ownership guidelines: CEO must hold shares equal to 5x base salary; five-year compliance window; applies to beneficially owned shares; non-employee director guidelines separately maintained.
- Hedging and pledging: Prohibited for directors and named executive officers; no short-selling or derivative transactions; pledging prohibited.
- Significant shareholder group owns 41.94% via trusts and related entities; Board maintains Lead Independent Director and separated Chair roles to mitigate control risk.
Unvested Awards and Key Vesting Dates (as of 12/31/2023)
| Award Type | Shares Unvested | Vest Date |
|---|---|---|
| RSA | 3,600 | Vested 1/23/2024 (granted 1/23/2018) |
| RSA | 5,700 | 1/22/2025 (granted 1/22/2019) |
| RSA | 9,630 | 1/28/2026 (granted 1/28/2020) |
| RSA | 28,000 | 1/26/2027 (granted 1/26/2021) |
| RSA | 32,000 | 1/26/2027 (granted 1/26/2022) |
| RSA | 72,525 | 2/16/2027 (granted 2/16/2023) |
| PSU | 72,525 | 12/31/2025 (FY2023 grant) |
| PSU | 38,250 | 2/20/2027 (FY2024 grant) |
- RSAs are time-lapse restricted stock under the 2018 Plan; PSUs cliff vest subject to multi-year performance with dividend equivalents accrued at target and paid upon vest; no voting rights prior to vest.
Employment Terms
| Provision | Key Terms |
|---|---|
| Change-in-Control (CIC) | Double-trigger: if terminated without cause or for good reason within 24 months post-CIC → lump sum 3x base salary + target bonus (CEO); pro-rated bonus for year of termination; 18 months employer health premium; PSUs vest at assumed target performance. |
| Restrictive Covenants | 2-year non-compete; 2-year non-solicitation of protected customers; 2-year non-recruitment of employees/contractors; confidentiality and non-disparagement obligations. |
| Clawback | Adopted 2023; mandatory recovery of incentive compensation upon accounting restatement per SEC/NYSE rules; bonus recoupment for misrepresented/inaccurate performance; SOX disgorgement for CEO/CFO in cases of misconduct-related restatements. |
| Bonus Eligibility | Must remain employed through year-end; no payouts for termination before year-end (with limited exceptions for transfers/promotions). |
| Indemnification | Directors/officers indemnified to fullest extent permitted; separate indemnification agreements in place. |
Board Governance
- Board leadership separated from CEO; Executive Chairman Emeritus and Executive Chairman of the Board roles are distinct, with Louise S. Sams serving as Lead Independent Director since the 2024 Annual Meeting, overseeing executive sessions of independent directors.
- Committees: Audit; Human Capital Management and Compensation; Nominating & Corporate Governance; Gahlhoff serves on the Board (member “M”) but is not a member of Board committees.
- Attendance: Each incumbent director attended at least 75% of Board/committee meetings; all attended last Annual Meeting; Board held 4 meetings, with 7 Audit, 5 Compensation, and 6 Nominating meetings in 2024.
- Dual-role implications: CEO is also a director (not Chair), with independent board leadership and a Lead Independent Director structure designed to ensure oversight and independence amid high insider ownership.
Compensation Structure Analysis
- Pay mix and “at risk”: Approximately 80% of executive compensation is at risk; strong equity emphasis and explicit pay-for-performance structures.
- Shift in long-term design: 2023 introduced PSUs with Revenue CAGR, Adjusted EBITDA Margin, and a TSR Modifier; 2024 PSUs continued with TSR as a core component (no option grants).
- Annual incentive rigor: Threshold at 95% of plan and max at ≥105% of plan; 2023 revenue outperformance delivered max payout on the revenue element.
- Governance features: Independent Compensation Committee and consultant (Mercer); stock ownership guidelines; hedging/pledging prohibition; clawback policy enhanced in 2023.
Equity Ownership & Alignment Signals
- CEO beneficial ownership of 346,163 shares (includes 223,257 restricted shares and 1,560 shares in 401(k)); percent of outstanding noted as “**” in the proxy (immaterial).
- Ownership guidelines require 5x salary for CEO; five-year compliance horizon.
- No options outstanding; equity awards are RSAs and PSUs with multi-year performance requirements; dividend equivalents accrue on PSUs at target and pay on vest.
Retention and Insider Selling Pressure
- Upcoming cliffs: FY2023 PSUs cliff vest on 12/31/2025; FY2024 PSUs cliff vest on 2/20/2027; RSAs scheduled vestings in 2025–2027 create mechanical vest events that can drive taxable income and potential sales to cover taxes.
- 2024 realized value on vesting: $1,816,380 for CEO (42,791 shares), highlighting meaningful equity income realization windows.
- Pledging/hedging prohibitions reduce misalignment risk; strong ownership guidelines bolster alignment.
Employment & Contracts
- CIC economics: 3x base + target bonus for CEO under double-trigger; pro-rated bonus; health continuation; PSUs vest at target; robust post-employment restrictive covenants.
- Bonus and equity forfeiture terms: Annual bonus requires year-end employment; RSAs and PSUs generally forfeited on termination absent specified exceptions (death, disability, CIC for RSAs).
Investment Implications
- Alignment: Multi-year PSUs tied to revenue growth, EBITDA margin, and Relative TSR support pay-for-performance and long-term value creation focus; ownership guidelines and anti-pledging/hedging policies further align interests.
- Retention risk: Strong CIC protections (3x base + target bonus) and upcoming vest cliffs through 2025–2027 indicate high retention incentives; restrictive covenants (2-year non-compete and non-solicit) lower transition risk.
- Trading signals: Monitor Form 4s around vesting dates (e.g., 12/31/2025; 1/22/2025; 1/28/2026; 1/26/2027; 2/16/2027; 2/20/2027) for potential tax-related dispositions; 2024 vest realizations were significant.
- Governance: CEO also serves as a director, but separation of Board chair roles and presence of a Lead Independent Director, plus independent compensation oversight, mitigate independence concerns amid concentrated insider ownership.