DEF 14A of Velocity Financial, Inc.
Filed Apr 11, 2025 · FY20240001193125-25-078790
Proxy Statement
Proxy Statement April 11, 2025 Dear Fellow Shareholders,
Proxy Statement
| Our Annual Meeting of Shareholders will be held on Friday, May 23, 2025 at 1:00 p.m. Pacific time. We will again utilize a virtual format for our meeting. Our Perspective on 2024 Velocity delivered impressive earnings in the fourth quarter and full-year 2024. The Company’s record full-year 2024 earnings were driven by continued strong production, which also reached record levels in 2024, on both an unpaid principal balance and loans produced basis. I am pleased to announce that we achieved our “5X25” goal set a few years ago of a $5 billion loan portfolio by 2025. Your Vote Matters Please accept our most sincere gratitude for your investment and partnership with us. We ask you to vote by proxy in support of our recommendations. This proxy statement contains necessary information about the matters on which we are asking you to vote. Thank you for your continued support. Sincerely, Christopher D. Farrar Chief Executive Officer & Director | | | | “I am pleased to announce that we achieved our “5X25” goal set a few years ago of a $5 billion loan portfolio by 2025.” |
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Notice of Annual Meeting of Shareholders
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| | Date and Time May 23, 2025 at 1:00 p.m. | | Virtual Only Connect by Internet or phone: www.virtualshareholdermeeting.com/VEL2025 | |
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This Proxy Statement is being furnished to our shareholders in connection with the solicitation of proxies by our Board of Directors for use at our 2025 Annual Meeting of Shareholders. Purpose of Meeting
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| Proposals | Vote Required to Elect or Approve | Board Recommendation | Page Reference | | Election of Directors | Majority of the votes cast | ✓ For each nominee | • 1 | | Advisory Vote on 2024 Executive Compensation | Majority of the votes cast | ✓ For | • 11 | | Ratification of Independent Auditors | Majority of the votes cast | ✓ For | • 25 | | Increase the Share Reserve Under our 2020 Omnibus Incentive Plan | Majority of the votes cast | ✓ For | • 27 |
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We will also consider other matters that properly come before the meeting. Shareholders should read Other Important Information for Our Shareholders beginning on page 39 for additional information. Whether you hold shares directly as a shareholder of record or beneficially in street name, you may vote your shares without attending our Annual Meeting. Voting instructions are outlined in the Notice of Internet Availability of Proxy Materials and on your proxy card.
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| | Vote | If you are a shareholder of record | If you hold your shares in street name | | | By Internet (24 hours a day): | proxyvote.com | proxyvote.com | | | By Telephone (24 hours a day): | 1-800-690-6903 | 1-800-454-8683 | | | By Mail: | Return a properly executed and dated proxy card in the provided pre-paid envelope | Return a properly executed and dated voting instruction form by mail, depending upon the method(s) your bank, brokerage firm, broker-dealer or other similar organization makes available |
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| Director Matters | 1 | | Proposal I Election of Directors | 1 | | Our Director Nominees | 1 | | Biographies of Our Directors | 2 | | Board Skills, Experiences and Demographic Information | 4 | | The Board’s Role and Responsibilities | 5 | | Board Structure | 5 | | Board Practices, Processes and Policies | 9 | | Director Compensation | 10 | | Executive Compensation Matters | 11 | | Proposal II Advisory Vote on Executive Compensation | 11 | | Compensation Committee Report | 11 | | Compensation Discussion and Analysis | 12 | | Overview | 12 | | Executive Compensation Tables | 18 | | 2024 Compensation Plan Outcomes | 19 | | Summary of Payments upon Termination of Employment or Change-in-Control | 24 | | Audit Matters | 25 | | Proposal III Ratification of Independent Auditors | 25 | | Fees Paid to Our Independent Auditors | 25 | | Audit Committee Report | 26 | | Other Shareholder Matters | | | Proposal IV Approve an Increase to the Share Reserve Under our 2020 Omnibus Incentive Plan | 27 | | Stock Ownership Information | 35 | | Beneficial Ownership by Principal Shareholders | 35 | | Beneficial Ownership of Directors and Management | 36 | | Equity Compensation Plan Information | 37 | | Section 16(a) Beneficial Ownership Reporting Compliance | 37 | | Additional Information | 38 | | Biographies of Other Executive Officers | 38 | | Forward-Looking Statements | 38 | | Other Important Information for Our Shareholders | 39 |
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Director Matters
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| Proposal I Election of Directors | • Directors are elected at each annual meeting of shareholders and hold office for one-year terms • Our Governance Committee considers and chooses nominees for our Board with the primary goal of ensuring that our Board is appropriately diverse and consists of individuals with various career experience, specific technical skills, industry knowledge and experience, financial expertise, accounting and audit expertise and local or community ties • We also have to comply with our agreements to accept five nominees from our two primary shareholders and our CEO • Unless otherwise directed, proxies will be voted for our eight nominees and, if a nominee becomes unavailable for election, for the substitute proposed by our Board of Directors ✓ The Board recommends a vote FOR each of our nominees |
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Our Director Nominees
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| Name | Tenure | Audit Committee | Compensation Committee | Governance Committee | | Dorika M. Beckett Independent | 2020 | o | | o | | Michael W. Chiao Independent | 2021 | | o | | | Christopher D. Farrar Chief Executive Officer and Director | 2004 | | | | | Alan H. Mantel Independent Board Chair | 2007 | | X | | | John P. Pitstick Independent | 2020 | X | o | | | John A. Pless Independent | 2007 | | | X | | Joy L. Schaefer Independent Lead Independent Director | 2020 | o | | o | | Omar M. Maasarani Independent | 2023 | | | |
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| o | Member | | X | Chair |
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Biographies of Our Directors As described below, each of our directors was chosen because his or her background provides each director with the experience and skillset geared toward helping us succeed. Our directors bring to us strong executive operating experience, expertise in the real estate and financial services sectors, accounting and audit expertise and broad experience in other complementary sectors such as investment management and private equity, among others, and meaningful commitment to community and public service – knowledge and experiences that are ideally suited to oversee our management and act as fiduciaries for our shareholders. Dorika M. Beckett has served as a member of our Board of Directors since July 2020. Ms. Beckett brings to our board executive, entrepreneurial, investment, private equity, operational and philanthropic experience. For over a decade, Ms. Beckett has been Chief Executive Officer of both LW Staffing, a franchise of healthcare professional staffing company ATC Healthcare Services, and Livewell Home Care Inc., an elder care focused service provider with operations in California and North Carolina. Previously, Ms. Beckett served as partner of a private equity firm, director of operations and management consultant in various industries. She is also Chair of the Imani Baraka Foundation, a family non-profit foundation. Ms. Beckett received a Bachelor of Arts (A.B.) in Economics from Harvard College and a Master of Business Administration from the Harvard Business School. Michael W. Chiao has served as a member of our Board of Directors since April 2021. Mr. Chiao brings to our board extensive investment experience, including direct experience in structured products. Mr. Chiao is an executive vice president and portfolio manager in the Newport Beach office of Pacific Investment Management Company LLC (PIMCO), focusing primarily on residential loan investments. Prior to joining PIMCO in 2017, he worked at Fortress Investment Group, focused on non-agency residential mortgage-backed securities and various structured products. Previously, Mr. Chiao spent three years at PIMCO as a portfolio management associate, and he began his career as an analyst in the whole loan trading and securitization group at Countrywide Capital Markets. He has 18 years of investment experience and holds an undergraduate degree from California State Polytechnic University, Pomona. Christopher D. Farrar has served as our Chief Executive Officer and as a member of our Board of Directors since 2004. Mr. Farrar brings extensive operating experience and management skills to our Board of Directors. Mr. Farrar has an extensive background in finance, lending, raising capital and business operations – having co-founded us in June 2004. Prior to co-founding Velocity, Mr. Farrar formed and served as Chief Credit Officer for Worth Funding, a mortgage banking firm. Prior to that time, Mr. Farrar served as Senior Vice President of United States Production at Weyerhaeuser Mortgage Company and as a Vice President for Namco Capital Group, Inc., originating commercial real estate loans. Mr. Farrar is currently a director of Generosity.org, a non-profit working to bring global communities access to clean water, and a director of Agoura Aquatic Foundation, a non-profit providing opportunities for youth to participate in aquatic sports and adults and disabled to engage in aquatic training. Mr. Farrar received a Bachelor of Science in Business Administration from Pepperdine University and is a licensed (inactive) California Real Estate Broker. Alan H. Mantel has served as a member of our Board of Directors since 2007 and as Chair of our Board of Directors since 2020. With over 30 years on Wall Street, Mr. Mantel has experience across a wide array of investment banking disciplines, including corporate finance, financial advisory, mergers and acquisitions and structured finance. Mr. Mantel brings to our Board of Directors extensive experience in the financial services sector, including leveraged and structured finance, and background with and knowledge of accounting principles. Mr. Mantel is a Co-Managing Partner of TruArc Partners, L.P. a successor business to Snow Phipps (one of our largest shareholders). Mr. Mantel was a Partner of Snow Phipps from 2005 to April 2021. Before joining Snow Phipps, Mr. Mantel was a Partner at Guggenheim Merchant Banking. Mr. Mantel served as a Managing Director in the Leveraged Finance department at Credit Suisse from 2000 to 2004 and served as a Managing Director at Donaldson, Lufkin & Jenrette Inc. prior to its merger with Credit Suisse. Mr. Mantel was a Senior Accountant and Certified Public Accountant (inactive) at Ernst & Young LLP from 1985 to 1988. Mr. Mantel currently serves on the boards of Aptyx, ECRM, LLC, EnviroFinance Group, LLC, HCTec, Inc. and Lamark Media, LLC. Mr. Mantel received a Bachelor of Science in accounting from the State University of New York at Albany and a Master of Business Administration in Finance from the University of Chicago. Omar M. Maasarani has served as a member of our Board of Directors since 2023. Mr. Maasarani brings to our Board of Directors extensive experience in the financial services sector. Mr. Maasarani is a portfolio manager at PIMCO focused on originating, executing, and managing private equity and structured equity investments as part of the firm’s alternatives investing complex. Prior to joining PIMCO in 2018, Mr. Maasarani spent nearly a decade with Morgan Stanley, most recently as a vice president with the firm’s private equity investing team. At Morgan Stanley, he executed and managed over a dozen investments across the technology, business services, and consumer sectors. Earlier in his career, Mr. Maasarani worked in the financial services investment banking advisory group at Morgan Stanley and in asset management at Goldman Sachs. He has 18 years of investment and financial services experience and holds a bachelor’s degree from Rutgers University. John P. Pitstick has served as a member of our Board of Directors since January 2020. Mr. Pitstick has experience in accounting, taxes, capital markets, financial operations, internal controls and SEC reporting/compliance matters. Mr. Pitstick brings over 30 years of combined experience as a financial executive of publicly traded and privately held companies along with experience at a major accounting firm to our Board of Directors. Mr. Pitstick currently serves as CFO of Gameverse Interactive, Inc. From 2015 through 2024, Mr. Pitstick held financial executive roles at privately held companies including medical device manufacturer Caldera Medical, Inc., biotechnology developer Dyve Biosciences, Inc. and software solutions provider Seven Lakes Enterprises, Inc. Mr. Pitstick served as Executive Vice President from 2005 to 2007 and then as Chief Financial Officer from 2007 to 2015 of publicly traded Conversant, Inc. From 1995 to 2004, Mr. Pitstick worked for Ernst & Young LLP serving a broad range of clients in the technology, biotech and financial services industries, ultimately as a Senior Manager. Mr. Pitstick is a Certified Public Accountant (inactive) and received a Bachelor of Science in Accounting from the University of San Francisco.
Proxy Statement
John A. Pless III has served as a member of our Board of Directors since 2007. Mr. Pless brings broad finance and corporate governance experience to our Board of Directors. Mr. Pless is a Managing Partner of TruArc Partners, LP, a successor business to Snow Phipps. Mr. Pless joined Snow Phipps at the inception of the firm in 2005 and became a Partner in 2012. Prior to his tenure with Snow Phipps, Mr. Pless worked as a Vice President at Guggenheim Merchant Banking and served as Associate Director in the Financial Institutions Group at UBS Investment Bank, the investment banking arm of UBS AG, where he worked on a wide range of mergers and acquisitions and capital raising transactions for banks and specialty finance companies. Mr. Pless currently serves on the boards of BlackHawk Industrial Distribution, Inc., Cascade Environmental LLC, EnviroFinance Group, LLC, HCTec, Inc., Ideal-Tridon Holdings, Inc., Prototek Holdings LLC, New Directions Aromatics Inc., Trademark Cosmetics, Inc., Meyer Laboratory Inc. and Molded Devices, Inc. He is also a board member of Little Wings Foundation, a family foundation financially assisting other non-profits working on issues like education, children’s health, international outreach and terminal diseases. Mr. Pless received a Bachelor of Arts in Economics from Middlebury College. Joy L. Schaefer has served as a member of our Board of Directors since January 2020 and was elected as Lead Independent Director of our Board in February 2022. Ms. Schaefer brings to our Board of Directors a broad range of experience in a variety of asset classes including auto finance, residential mortgages, multi-family mortgages and home equity lending. Since August 2005, Ms. Schaefer has served as President of Golden Eagle Advisors, LLC, a consulting firm focused on organizational development and growth through strategic, operational and financial improvements. From 2005 until August 2018, Ms. Schaefer served as an operating partner of Snow Phipps. From 2002 until 2005, Ms. Schaefer served as President of JL Schaefer Consulting, a strategic, financial and operational consulting practice, advising privately held and family-owned businesses. In 2002, Ms. Schaefer served as President and Chief Operating Officer of Ameriquest Mortgage, a privately held mortgage banking company. From 1990 until 2002, Ms. Schaefer served in various senior management positions within the Westcorp family of companies, including as President and Chief Operating Officer of Westcorp, Inc., a publicly traded financial services holding company, Vice Chairman, Chief Executive Officer, President and Chief Operating Officer of WFS Financial, Inc., a publicly traded national automobile finance company and Chief Operating Officer, Senior Executive Vice President, Chief Financial Officer and Treasurer of Western Financial Bank, Inc. Earlier in her career, Ms. Schaefer was an audit manager for Ernst & Young. Ms. Schaefer currently serves on the board of directors of American Assets Trust, Inc. (NYSE: AAT). Ms. Schaefer received a Bachelor of Science degree in Accounting from Illinois Wesleyan University. Board Skills, Experience and Demographic Information
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| Skills & Experience | | | | | | | | | | Accounting and Audit Experience | ● | ● | ● | ● | | ● | ● | ● | | Corporate Strategy & Business Development | ● | ● | ● | ● | ● | ● | ● | ● | | Corporate Governance | ● | | | ● | | ● | ● | ● | | Corporate Finance | | ● | ● | ● | ● | ● | ● | ● | | Ethics / Social Responsibility Oversight | ● | | | ● | | | | ● | | Financial Services | ● | ● | ● | ● | ● | ● | ● | ● | | Executive Leadership & Management | ● | ● | ● | ● | ● | ● | ● | ● | | Mergers & Acquisitions | | | ● | ● | | ● | ● | ● | | Private Equity and Investments | ● | ● | ● | ● | ● | ● | ● | ● | | Public Company Experience | | | ● | | | ● | | ● | | Real Estate Industry Experience | | ● | ● | ● | ● | | ● | ● | | Risk Oversight | ● | ● | ● | ● | | ● | ● | ● | | Security Risk Experience | ● | | ● | | | | | | | Demographic Background | | | | | | | | | | Gender | | | | | | | | | | Male | | ● | ● | ● | ● | ● | ● | | | Female | ● | | | | | | | ● | | Race/Ethnicity | | | | | | | | | | African American / Black | ● | | | | | | | | | Asian, Hawaiian or Pacific Islander | | ● | | | | | | | | White / Caucasian | | | ● | ● | ● | ● | ● | ● | | Hispanic / Latino | | | | | | | | | | Native American | | | | | | | | | | Age | 56 | 42 | 59 | 61 | 39 | 51 | 48 | 65 |
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The Board’s Role and Responsibilities Risk Oversight Our Board of Directors has extensive involvement in the oversight of risk management related to us and our business and accomplishes financial risk oversight by delegation to the Audit Committee. The Audit Committee represents the Board of Directors by periodically reviewing our accounting, reporting and financial practices, including the integrity of our financial statements, the surveillance of administrative and financial controls and legal matters that could have a significant impact on our financial statements. Through its meetings with and receipt of reports from management, including the finance, legal and internal audit functions, the Audit Committee reviews and discusses significant areas of our business and summarizes for the Board of Directors financial risks and appropriate mitigating factors. In addition, our Board of Directors communicates regularly with management on operating performance, strategic reviews, potential transactions, legal and compliance matters, corporate policies and procedures as well as other business matters. Information Security Risk Among other things, Management has been tasked by the Board of Directors with identifying and mitigating information security risks. Management has implemented a security awareness training platform to continually train users on computer safety. Monthly simulated phishing campaigns are used to test and assign training to users. Bi-annual company-wide training is also assigned to ensure all employees are staying current on the latest security threats and how to stay protected. We have implemented a defense-in-depth strategy to protect all users, network assets and digital information. Perimeter network traffic is controlled by next-generation firewalls that conduct anti-malware, anti-spyware, DNS security, content filtering and threat analysis services on ingress and egress traffic. Endpoints, including servers, workstations, and laptops, run anti-malware agents that monitor for threats in real-time, in addition to scheduled scans of local storage for dormant malicious files. Workstations and laptops run DLP agents that monitor for unsanctioned exfiltration of personal information data. All perimeter and endpoint data are collected in a detection and response platform that correlates the data and alerts the security operations team of potential security breaches. E-mails are scanned with protection tools, in additional to other third-party e-mail security tools. The third-party email security service also monitors for personal information data loss. Vulnerability scanning services are utilized to continually scan all network assets for vulnerabilities and sends reports to our security operations teams for remediation. We recognize that the risks and impacts of cyber based attacks are significant and increasing. Addressing any such incidents quickly and effectively is paramount to the continued operations of our business. We seek to track and investigate all cyber based incidents or incidents that impact our information systems. We adopted an incident response plan that requires us to assess and address such incidents in a timely manner. In the event of an incident, our incident response team and management will focus on minimizing impact while securely and safely restoring disrupted services and systems. Board Structure Director Independence In accordance with our Corporate Governance Guidelines, available on our website, www.velfinance.com, our Board of Directors undertook its annual review of director independence. During this review, our Board considered all transactions and relationships between us and each nominee for director or any member of such person’s immediate family. The purpose of this review is to determine whether any relationship or transaction is considered a “material relationship” that would be inconsistent with a determination that a director is independent. Our Board has not adopted any “categorical standards” for assessing independence. Our Board affirmatively determined that each of our non-employee director nominees is independent. In making this determination, our Board reviewed the corporate governance rules of the New York Stock Exchange, the exchange where we have listed our common stock. The Board considered commercial, charitable, family and other relationships that directors or members of their immediate family have or have had with us. In addition, for our Audit Committee members, our Board also considered the requirements of Rule 10A-3 under the Exchange Act. In particular, our Board considered that Messrs. Mantel and Pless were both partners of Snow Phipps, one of our largest shareholders, and are managing partners of TruArc Partners, a sub adviser to the Snow Phipps funds that own our shares, and that until August 2018, Ms. Schaefer was an operating partner of Snow Phipps. Our Board also considered that Messrs. Chiao and Maasarani are officers of Pacific Investment Management Company LLC, another one of our largest shareholders. Our Board determined that these relationships are not material relationships and therefore do not affect our Board’s determination that these directors are independent. Board Nominee Rights In connection with our January 2020 initial public offering, we entered into a stockholders agreement granting rights to nominate up to four individuals to our Board of Directors and in connection with our sale of Series A Preferred Stock, we granted an additional right to nominate an individual to our Board. The following summarizes those rights:
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| • | Christopher Farrar has the right to nominate one director so long as he or his family continues to beneficially own at least 71,458 of our common shares – Christopher Farrar has nominated himself as a director |
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| • | Snow Phipps has the right to nominate one director so long as they continue to beneficially own at least 1,506,563 shares of our common stock and the right to nominate a second director so long as they continue to beneficially own at least 3,013,125 shares of our common stock. Snow Phipps is also entitled to have one of their director nominees appointed to each of our Board’s Compensation Committee and Governance Committee, subject to qualification under applicable NYSE rules – Snow Phipps has nominated Alan Mantel and John Pless |
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| • | Pacific Investment Management Company (PIMCO) has the right to nominate one director so long as they continue to beneficially own at least 1,506,563 shares of our common stock and the right to nominate a second director so long as they continue to beneficially own at least 1,623,377 shares of our common stock – PIMCO has nominated Michael Chiao and Omar Maasarani |
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Executive Sessions Our independent directors and each Board Committee (all comprised of independent directors) have the ability to meet at any time in executive session outside the presence of management. Our Board Chair, our Lead Independent Director Chair or a Committee Chair presides over each executive session, as applicable, and each non-management member of our Board has the authority to call such executive sessions. Directors and Board Committees Our Board has standing Audit, Compensation and Governance Committees, each of which has adopted a written charter that is available on our website, www.velfinance.com.
Board of Directors
Board of Directors
Board of Directors
| 7 meetings in 2024 Board Chair Alan H. Mantel Lead Independent Director Joy L. Schaefer Other Members Michael J. Chiao Omar Maasarani Dorika M. Beckett John P. Pitstick Christopher D. Farrar John A. Pless | All of our directors attended at least 75% of the meetings of our Board of Directors and Committees on which they served during 2024. We do not have a policy requiring director attendance at our Annual Shareholder Meetings. |
Key Responsibilities
| • | Review and recommend to our Board any changes to director compensation |
Related Person Policy and Transactions
| Name(1) | Fees Earned or Paid in Cash ($) | Stock Awards ($)(2) | Total ($) | | Dorika M. Beckett | 95,000 | 95,000 | 190,000 | | Michael W. Chiao | — | — | — | | Alan H. Mantel | — | — | — | | John P. Pitstick | 105,000 | 95,000 | 200,000 | | John A. Pless | — | | — | | Joy L. Schaefer | 95,000 | 95,000 | 190,000 | | Omar Maasarani | — | — | — |
Executive Compensation Objectives and Philosophy
| • | Investor Aligned: Incentives should be structured to create a strong alignment between executives and investors on both a short-term and a long-term basis |
Considerations in Setting 2024 Compensation
| • | Use of Market Data. We established general target compensation levels that are consistent with market practice and internal equity considerations (including position, responsibility and contribution) relative to base salaries, cash bonuses and long-term equity compensation, as well as with the assessment of the appropriate pay mix for a particular executive. To gauge the competitiveness of our compensation programs, we, with the assistance of Mercer, reviewed compensation practices and pay opportunities from our 2024 list of financial services and real estate lending industry peers. We attempt to position compensation to attract and retain qualified executive officers in the face of competitive pressures in relevant markets. |
Considerations in Setting 2024 Compensation
| • | Importance of Our Results. In determining the amount of cash bonus for each executive officer, we considered performance with respect to our success in implementing our short-term business strategies that yield long-term benefits, such as increasing or maintaining the amount of loans in our portfolio, credit quality and portfolio earnings. Our Board of Directors believes it is important to hold our executive officers accountable for our overall results. |
Elements of 2024 Compensation Program
| • | Performance-based Cash Incentive Bonus |
Elements of 2024 Compensation Program
| • | Annual Long-Term Equity Incentive Compensation |
Elements of 2024 Compensation Program
| • | Multi-Year Long-Term Performance-Based Equity Incentive Compensation |
Elements of 2024 Compensation Program
We believe that offering each of the components of our executive compensation program is necessary to remain competitive in attracting and retaining talented executives. Base salaries and cash bonuses are designed to reward executives for their performance and our performance. Furthermore, the cash incentive bonus and long-term equity incentive compensation align the executive’s goals with our goals and those of our shareholders. The components of incentive compensation (the cash bonus and equity awards) are significantly “at risk,” as the cash bonuses and the value of the equity awards depend on our business successes. Collectively, these components are designed to reward and influence an executive’s individual performance and our short-term and long-term performance.
Performance-Based Cash Incentive Bonus
Performance-Based Cash Incentive Bonus In addition to receiving base salaries, our Named Executive Officers are eligible to receive cash incentive bonuses. Cash bonuses are designed to incentivize our Named Executive Officers at a variable level of compensation that is “at risk,” based on our performance and the performance of each executive. In February 2024, our Compensation Committee approved fiscal year 2024 target bonuses for our Named Executive Officers and adopted the Velocity Financial FY 2024 Annual Cash Incentive Program which provided that cash bonus amounts for the Named Executive officers would be formulaically based 50% on our 2024 core net income annual growth and 50% on individual and corporate performance objectives. Under the incentive program, each Named Executive Officer could have been awarded between 0% – 200% of that officer’s target bonus. At the time of adoption, the Compensation Committee believed that the performance amounts below to achieve Threshold, Target and Maximum performance payouts were equally uncertain and fair. Performance Metric – Core Net Income Annual Growth:
Performance-Based Cash Incentive Bonus
| | Below Threshold | Threshold | Target | Maximum | | Core Net Income Annual Growth* | | 15% | 17.5% | 20% | | Payout as % of Target Bonus | 0% | 25% | 50% | 100% |
Performance-Based Cash Incentive Bonus
| * Core Net Income Annual Growth is the percentage growth calculated by subtracting Core Net Income for fiscal year 2023 from Core Net Income for fiscal year 2024 and dividing that difference by Core Net Income for fiscal year 2023. Core Net Income represents our net income after taxes adjusted to eliminate the effect of certain costs incurred or benefits received from activities that are not normal or recurring operating expenses or revenues. Net Income adjustments may be made to take into account, among other things, the effects of (i) acquisitions and strategic transactions, (ii) changes to capitalization, (iii) unusual or non-recurring accounting impacts or changes in accounting standards or treatment and (iv) unusual, non-recurring or extraordinary items. Payouts will be determined based upon linear interpolation for actual performance between levels. |
Performance-Based Cash Incentive Bonus
Performance Metric – Individual and Corporate Performance:
Performance-Based Cash Incentive Bonus
| | Below Threshold | Threshold | Target | Maximum | | Individual Assessment | Did Not Meet Minimum Expectations | Met Minimum Expectations | Met Expectations | Exceeded Expectations | | Payout as % of Target Bonus | 0% | 25% | 50% | 100% |
Performance-Based Cash Incentive Bonus
Individual and corporate performance consisted of the following:
Performance-Based Cash Incentive Bonus
| • | Asset quality and overall corporate risk management |
Performance-Based Cash Incentive Bonus
| • | Demonstration of leadership and decision making |
Performance-Based Cash Incentive Bonus
| • | Participation in and promotion of strategic initiatives |
Performance-Based Cash Incentive Bonus
| • | Showing inter department cooperation and team building |
Performance-Based Cash Incentive Bonus
| • | Successful completion of special projects |
Performance-Based Cash Incentive Bonus
Formulaic Outcome: Core Net Income Annual Growth for 2024 exceeded the 20% level for an award of maximum bonus. Our performance resulted in each of our Named Executive Officers being entitled to an amount equal to 100% of his target bonus for 2024. The Compensation Committee then discussed the individual and corporate performance metric with our CEO and concluded that each Named Executive Officer had “Exceeded Expectations.” Using the result of “Exceeded Expectations,” each of our Named Executive Officers was entitled to an additional amount equal to 100% of his target bonus for 2024. Based on Core Net Income Annual Growth for 2024 and the Compensation Committee’s conclusions regarding individual and corporate performance, each of our Named Executive Officers earned 200% of his target cash bonus for 2024. The following table provides the cash incentive bonus targets, the formulaic outcome of our 2024 incentive program and actual cash bonuses awarded to each Named Executive Officer in 2024. Each bonus was paid in February 2025 but is reflected as 2024 compensation.
Performance-Based Cash Incentive Bonus
| Name | 2024 Target Bonus | 2024 Cash Incentive Formulaic Outcome | 2024 Cash Incentive Bonus Awarded | | Christopher D. Farrar | $1,260,000 | $2,520,000 | $2,520,000 | | Mark R. Szczepaniak | $590,625 | $1,181,250 | $1,181,250 | | Jeffrey T. Taylor | $472,500 | $945,000 | $945,000 |
Annual Long-Term Equity Incentive Compensation
Annual Long-Term Equity Incentive Compensation In addition to base salary and cash bonus compensation, each of our Named Executive Officers was provided long-term equity incentive compensation. The use of long-term equity incentives creates a link between executive compensation and our long-term performance, thereby creating alignment between executive and investor interests. Equity awards under our 2020 Omnibus Incentive Plan, as amended in 2022 (the “2020 Plan”) are designed to reward our Named Executive Officers for long-term shareholder value creation and provide a means through which to attract and retain key personnel. Granting equity provides a means whereby our directors, officers and employees become shareholders, thereby strengthening their commitment to our welfare and aligning their interests with those of our other shareholders. For fiscal year 2024, we granted restricted stock with a pro rata three-year vesting schedule to our Named Executive Officers. The following table provides the grant date fair value of these long-term equity incentives granted to each Named Executive Officer:
Annual Long-Term Equity Incentive Compensation
| Name | 2024 Value of Restricted Stock | | Christopher D. Farrar | $1,102,500 | | Mark R. Szczepaniak | $383,907 | | Jeffrey T. Taylor | $354,375 |
Multi-Year Long-Term Performance-Based Equity Incentive Compensation
Multi-Year Long-Term Performance-Based Equity Incentive Compensation For fiscal year 2024, we also granted performance-based stock units (“PSUs”) with three-year cliff vesting and performance-vesting requirements to our Named Executive Officers. In January 2024, the Compensation Committee granted to each of Messrs. Farrar, Szczepaniak and Taylor 69,514, 24,205 and 22,343 shares, respectively, target number of performance-based stock units. Portions of the performance-based stock units will only vest at the end of three years if our average Core Net Income annual growth over the 3-year period meets or exceeds the 15% threshold growth rate approved by our Compensation Committee.
Multi-Year Long-Term Performance-Based Equity Incentive Compensation
| Name | 2024 Target Value of PSUs | | Christopher D. Farrar | $1,102,500 | | Mark R. Szczepaniak | $383,907 | | Jeffrey T. Taylor | $354,375 |
Multi-Year Long-Term Performance-Based Equity Incentive Compensation
None of the Named Executive Officers or the Compensation Committee will know how many PSUs will vest until January or February of 2027. At that time, the Named Executive Officers may vest in between 0 and 200% of the target number of performance-based stock units issued.
Other Considerations
| • | None of our Named Executive Officers have employment agreements with us |
Other Considerations
| • | Our Incentive Compensation Clawback Policy authorizes our Compensation Committee to reduce, cancel or recoup cash and equity awards if the Committee determines, in its discretion, that such compensation of an officer or employee was overpaid as a result of a restatement of our reported financial results |
Compensation Risk Management
Compensation Risk Management Our Compensation Committee has considered whether our compensation policies and practices reward employees for imprudent risk taking and has determined that our compensation policies and practices are not reasonably likely to have a material adverse effect on us. The Compensation Committee’s assessment will be conducted annually. Management reviews with our Compensation Committee our compensation programs, focusing on incentive programs, risks and mitigation factors. Based on the totality of this information, the Compensation Committee determines whether any portion of such compensation encourages excessive risk taking and concludes whether or not our compensation programs are reasonably likely to have a material adverse effect on us. In assessing risks, our Compensation Committee considers mitigating factors such as the multiple elements of our compensation packages, including base salary, cash bonuses, equity awards that are subject to vesting conditions, our ability to implement and enforce our clawback policy and other factors deemed relevant by the Committee.
Tax Considerations
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards(1) ($) | Option Awards ($) | Non-equity incentive plan compensation ($) | All Other Compensation(2) ($) | Total ($) | | Christopher D. Farrar | 2024 | 630,000 | — | 2,205,000 | — | 2,520,000 | 19,001 | 5,374,001 | | Chief Executive Officer | 2023 | 630,000 | — | 1,417,500 | — | 1,830,465 | 17,840 | 3,895,805 | | | 2022 | 630,000 | — | 1,136,700 | — | 1,228,500 | 21,339 | 3,016,539 | | Mark R. Szczepaniak | 2024 | 393,750 | — | 767,813 | — | 1,181,250 | 10,350 | 2,353,163 | | Chief Financial Officer | 2023 | 393,750 | — | 433,124 | — | 767,813 | 9,900 | 1,604,587 | | | 2022 | 393,750 | — | 378,900 | — | 639,844 | 9,352 | 1,421,846 | | Jeffrey T. Taylor | 2024 | 315,000 | — | 708,750 | — | 945,000 | 26,681 | 1,995,431 | | Executive Vice | 2023 | 315,000 | — | 345,500 | — | 589,680 | 24,510 | 1,274,690 | | President, Capital Markets | 2022 | 315,000 | — | 378,900 | — | 491,400 | 23,649 | 1,208,949 |
Grants of Plan-Based Awards in 2024
Grants of Plan-Based Awards in 2024 Non-Equity Incentive Plan Awards
Grants of Plan-Based Awards in 2024
| Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | | | | Threshold | Target | Maximum | | Christopher D. Farrar | 2/14/2024 | $630,000 | $1,260,000 | $2,520,000 | | Mark R. Szczepaniak | 2/14/2024 | $295,313 | $590,625 | $1,181,250 | | Jeffrey T. Taylor | 2/14/2024 | $236,250 | $472,500 | $945,000 |
Grants of Plan-Based Awards in 2024
Equity Incentive Plan and Other Stock Awards
Grants of Plan-Based Awards in 2024
| Name | Grant Date | Estimated Future Payouts Under Equity Incentive Plan Awards (#) | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | Grant Date Fair Value of Stock Awards | | | | Threshold | Target | Maximum | | | | Christopher D. Farrar | 1/23/2024 | — | — | — | 69,514 | $1,102,500 | | Christopher D. Farrar | 1/23/2024 | 34,757 | 69,514 | 139,028 | — | $1,102,500 | | Mark R. Szczepaniak | 1/23/2024 | — | — | — | 24,205 | $383,907 | | Mark R. Szczepaniak | 1/23/2024 | 12,103 | 24,205 | 48,410 | — | $383,907 | | Jeffrey T. Taylor | 1/23/2024 | — | — | — | 22,343 | $354,375 | | Jeffrey T. Taylor | 1/23/2024 | 11,172 | 22,343 | 44,686 | — | $354,375 |
Outstanding Equity Awards at Fiscal Year-End 2024
Outstanding Equity Awards at Fiscal Year-End 2024 Option Awards This table provides information on the holdings of option awards by our Named Executive Officers at December 31, 2024.
Outstanding Equity Awards at Fiscal Year-End 2024
| Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price | Option Expiration Date | | Christopher D. Farrar | 1/16/2020 | 375,000 | — | $13.00 | 1/16/2030 | | Mark R. Szczepaniak | 1/16/2020 | 100,000 | — | $13.00 | 1/16/2030 | | Jeffrey T. Taylor | 1/16/2020 | 100,000 | — | $13.00 | 1/16/2030 |
Outstanding Equity Awards at Fiscal Year-End 2024
| These options were granted on January 16, 2020 and vested in three equal installments on the first three anniversaries of the grant date, subject to continued service on the vesting date. |
Outstanding Equity Awards at Fiscal Year-End 2024
Stock Awards This table provides information on the holdings of stock and performance awards by our Named Executive Officers at December 31, 2024.
Outstanding Equity Awards at Fiscal Year-End 2024
| Name | Grant Date | Number of Shares or Units of Stock that Have Not Vested (#) | Market Value of Shares or Units of Stock that Have Not Vested(5) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($)(5) | | Christopher D. Farrar | 2/14/2022(1) | 15,000 | $293,400 | | | | Christopher D. Farrar | 2/14/2022(2) | | | 45,000 | $880,200 | | Christopher D. Farrar | 1/13/2023(1) | 47,250 | $924,210 | | | | Christopher D. Farrar | 1/13/2023(3) | | | 70,875 | $1,386,315 | | Christopher D. Farrar | 1/23/2024(1) | 69,514 | $1,359,694 | | | | Christopher D. Farrar | 1/23/2024(4) | | | 69,514 | $1,359,694 | | Mark R. Szczepaniak | 2/14/2022(1) | 5,000 | $97,800 | | | | Mark R. Szczepaniak | 2/14/2022(2) | | | 15,000 | $293,400 | | Mark R. Szczepaniak | 1/13/2023(1) | 14,437 | $282,388 | | | | Mark R. Szczepaniak | 1/13/2023(3) | | | 21,656 | $423,591 | | Mark R. Szczepaniak | 1/23/2024(1) | 24,205 | $473,450 | | | | Mark R. Szczepaniak | 1/23/2024(4) | | | 24,205 | $473,450 | | Jeffrey T. Taylor | 2/14/2022(1) | 5,000 | $97,800 | | | | Jeffrey T. Taylor | 2/14/2022(2) | | | 15,000 | $293,400 | | Jeffrey T. Taylor | 1/13/2023(1) | 11,550 | $225,918 | | | | Jeffrey T. Taylor | 1/13/2023(3) | | | 17,325 | $338,877 | | Jeffrey T. Taylor | 1/23/2024(1) | 22,343 | $437,029 | | | | Jeffrey T. Taylor | 1/23/2024(4) | | | 22,343 | $437,029 |
Outstanding Equity Awards at Fiscal Year-End 2024
| (1) These shares vest in three equal installments on the first three anniversaries of the grant date, subject to continued service on the vesting date. |
Outstanding Equity Awards at Fiscal Year-End 2024
| (2) These shares were granted on February 14, 2022, vest on February 14, 2025 and are subject to Average Core Net Income Annual Growth as the performance metric for fiscal years, 2022, 2023 and 2024. Shares reported represent target shares granted. |
Outstanding Equity Awards at Fiscal Year-End 2024
| (3) These shares were granted on January 13, 2023, vest on February 14, 2026 and are subject to Average Core Net Income Annual Growth as the performance metric for fiscal years, 2023, 2024 and 2025. Shares reported represent target shares granted. |
Outstanding Equity Awards at Fiscal Year-End 2024
| (4) These shares were granted on January 23, 2024, vest on February 14, 2027 and are subject to Average Core Net Income Annual Growth as the performance metric for fiscal years, 2024, 2025 and 2026. Shares reported represent target shares granted. |
Outstanding Equity Awards at Fiscal Year-End 2024
| (5) Market value of unvested awards is based on $19.56, the NYSE closing price of our common stock on December 31, 2024. |
Option Exercises and Stock Vested in Fiscal 2024
Option Exercises and Stock Vested in Fiscal 2024 The following table reports options exercised and stock vested during 2024 for our Named Executive Officers.
Option Exercises and Stock Vested in Fiscal 2024
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise | Value Realized on Exercise | Number of Shares Acquired on Vesting | Value Realized on Vesting(1)(2)(3) | | Christopher D. Farrar | — | — | 60,000 | $961,200(1) | | Christopher D. Farrar | — | — | 15,000 | $240,150(2) | | Christopher D. Farrar | — | — | 23,625 | $378,473(3) | | Mark R. Szczepaniak | — | — | 20,000 | $320,400(1) | | Mark R. Szczepaniak | — | — | 5,000 | $80,050(2) | | Mark R. Szczepaniak | — | — | 7,218 | $115,632(3) | | Jeffrey T. Taylor | — | — | 20,000 | $320,400(1) | | Jeffrey T. Taylor | — | — | 5,000 | $80,050(2) | | Jeffrey T. Taylor | — | — | 5,775 | $92,516(3) |
Option Exercises and Stock Vested in Fiscal 2024
| (1) Based on $16.02 per share, the closing price of our common stock on January 12, 2024. |
Option Exercises and Stock Vested in Fiscal 2024
| (2) Based on $16.01 per share, the closing price of our common stock on February 14, 2024. |
Option Exercises and Stock Vested in Fiscal 2024
| (3) Based on $16.02 per share, the closing price of our common stock on January 12, 2024. |
Performance
| Year | Summary Compensation Table Total for PEO (1) | Compensation Actually Paid to PEO (2) | Average Summary Compensation Table Total for non-PEO Named Executive Officers (3) | Average Compensation Actually Paid to non-PEO Named Executive Officers (4) | Value of Initial Fixed $100 Investment Based On: | | Net Income (millions) | Core Net Income Annual Growth (6) | | | | | | | Total Shareholder Return | Peer Group Total Shareholder Return | | | | 2024 | $5,374,001 | $6,186,717 | $2,174,297 | $2,431,491 | $142.77 | NA(5) | $68.4 | 36.5% | | 2023 | $3,895,805 | $6,240,390 | $1,439,639 | $2,143,300 | $125.69 | NA(5) | $52.3 | 26.5% | | 2022 | $3,016,539 | $1,883,189 | $1,315,398 | $962,529 | $70.44 | NA(5) | $32.2 | 26.7% |
Performance
| (2) The dollar amounts reported in this column represent the amount of “compensation actually paid” to Mr. Farrar, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not necessarily reflect the actual amount of compensation earned by or paid to Mr. Farrar during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Mr. Farrar’s reported compensation for each year to determine the compensation actually paid: |
Performance
| (4) The dollar amounts reported in this column represent the average amount of “compensation actually paid” to the NEOs as a group (excluding Mr. Farrar), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not necessarily reflect the actual average amount of compensation earned by or paid to such NEOs during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for such NEOs for each year to determine the compensation actually paid: |
Pension Benefits in 2024
Pension Benefits in 2024 None
Non-Qualified Deferred Compensation
Non-Qualified Deferred Compensation None Potential Payments upon Termination of Employment or Change-in-Control The following information describes and quantifies certain compensation that would become payable under then-existing agreements and plans if a Named Executive Officer’s employment had terminated on December 31, 2024.
Summary of Payments upon Termination or Change-in-Control
Summary of Payments upon Termination or Change-in-Control The table below shows the estimated value of payments to which a named executive officer would have been entitled if the executive’s employment had been terminated on December 31, 2024. For purposes of valuing these amounts, we made the following assumption:
Summary of Payments upon Termination or Change-in-Control
| • | Shares of restricted stock and the target number of performance stock units that immediately vest upon death or disability are valued at $19.56, the NYSE closing price of our common stock on December 31, 2024 |
Summary of Payments upon Termination or Change-in-Control
| Name | Involuntary Termination Following a Change-in-Control | Termination Following a Change in Control | Retirement | Involuntary Termination | Death or Disability | | Christopher D. Farrar | — | — | — | — | $7,128,583 | | Mark R. Szczepaniak | — | — | — | — | $2,081,419 | | Jeffrey T. Taylor | — | — | — | — | $1,907,745 |
Summary of Payments upon Termination or Change-in-Control
Audit Matters
Summary of Payments upon Termination or Change-in-Control
| Proposal III | Ratification of Independent Auditors ✓ The Board recommends a vote FOR the ratification of RSM US LLP as our independent auditors |
Summary of Payments upon Termination or Change-in-Control
The Audit Committee selected RSM US LLP as our independent registered public accounting firm (our independent auditors) for 2025, and we are requesting our shareholders ratify this selection. This proposal is being submitted to shareholders because we believe that this action follows sound corporate practice and is in the best interests of the shareholders. If the shareholders do not ratify the selection, such a vote will not be binding, but the Audit Committee will reconsider the selection of independent auditors. If the shareholders ratify the selection, the Audit Committee, in its discretion, may still direct the appointment of new independent auditors at any time during the year if the Committee believes that this change would be in our and our shareholders’ best interests. Fees Paid to Our Independent Auditors The following table sets forth the aggregate fees incurred by us relating to services performed by RSM US LLP during 2024 and 2023:
Summary of Payments upon Termination or Change-in-Control
| | Fiscal Year Ended December 31, 2024 | Fiscal Year Ended December 31, 2023 | | Audit Fees | $1,589,355 | $1,455,913 | | Audit-Related Fees | — | — | | Tax Fees | — | — | | All Other Fees | — | — | | | $1,589,355 | $1,455,913 |
Summary of Payments upon Termination or Change-in-Control
A description of the types of services provided in each category is as follows:
Summary of Payments upon Termination or Change-in-Control
| • | Audit Fees – Includes fees associated with the audit of our annual financial statements and consents and assistance with and review of registration statements filed with the SEC |
Summary of Payments upon Termination or Change-in-Control
| • | Audit-Related Fees – Includes fees associated with the Uniform Single Attestation Program attest engagement |
Summary of Payments upon Termination or Change-in-Control
| • | Tax Fees – Includes fees associated with tax compliance, advice and planning |
Summary of Payments upon Termination or Change-in-Control
The Board considered whether providing the non-audit services included in this table was compatible with maintaining RSM US LLP’s independence and concluded that it was.
Submitted by the Audit Committee of the Board of Directors
| • | Specific limits on total director compensation |
Submitted by the Audit Committee of the Board of Directors
| • | Specific limits on total director compensation |
Submitted by the Audit Committee of the Board of Directors
Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Securities Exchange Act of 1934 requires our executive officers and directors and persons who beneficially own more than 10% of our common stock to file reports of ownership and changes in ownership with the SEC within two business days. To our knowledge all such persons filed the required reports on a timely basis during 2024 with no exceptions. Additional Information Biographies of Other Executive Officers Roland T. Kelly, 55, has served as our Chief Legal Officer since March 2021 and as our General Counsel and Corporate Secretary since July 2020. Mr. Kelly is a corporate, regulatory, governance and capital markets professional with a career spanning more than 25 years on Wall Street. Prior to joining us, Mr. Kelly was a Managing Director and Associate General Counsel for Jefferies Financial Group Inc., an NYSE-listed, Fortune 500 company focused on investment and merchant banking. Mr. Kelly previously worked for the law firm of Morgan, Lewis & Bockius and worked as a regulator with the U.S. Securities and Exchange Commission. He is also currently a director and audit committee chair for the Children’s Law Center of California, a non-profit organization and the largest children’s legal services organization in the nation. Mr. Kelly earned his Juris Doctorate from Pepperdine University School of Law and his Bachelor of Science in Business Administration/Finance from the California Polytechnic State University in San Luis Obispo. Mr. Kelly is licensed to practice law in California, New York and Washington D.C. Mark R. Szczepaniak, 67, has served as our Chief Financial Officer since May 2017. Mr. Szczepaniak has more than 35 years of industry experience in the real estate/financial services industry and has held various senior positions with both publicly and privately-held finance companies. Mr. Szczepaniak served as Managing Director of Finance, SOX, & Tax at PennyMac Financial Services Inc. from 2013 until joining us in 2017. From 2009 to 2012, Mr. Szczepaniak served as Chief Financial Officer of Prospect Mortgage. From 2004 to 2007, Mr. Szczepaniak served as Chief Financial Officer and Vice President of Finance of the Federal Home Loan Bank of Seattle and from 1996 to 2004 he served as Senior Vice President and Corporate Controller at the Federal Home Loan Bank of Chicago. Mr. Szczepaniak is a Certified Public Accountant, licensed in the state of California, and a Chartered Global Management Accountant. Mr. Szczepaniak received his Bachelor of Science in Finance and Accounting from St. Joseph’s College. Jeffrey T. Taylor, 57, has served as our Executive Vice President, Capital Markets since 2004. Mr. Taylor has more than 30 years of experience in the secondary mortgage market. Mr. Taylor co-founded the Company in June 2004. Prior to that time, Mr. Taylor worked for two different opportunity funds that purchased Resolution Trust Corporation and FDIC loan portfolios and as Vice President of Operations for 2dmkt.com, an internet start-up that created a platform for trading commercial real estate loan portfolios. Mr. Taylor also served as a Vice President with BayView Financial Trading Group L.P. where he managed the Northern California, Oregon and Washington markets for the commercial lending group and at Countrywide Securities Corporation where he served as a Transaction Manager. Mr. Taylor received a Bachelor of Arts from the University of California, Santa Cruz in Economics and History and a Master of Real Estate Development from the University of Southern California. Forward-Looking Statements This document contains “forward-looking statements” within the meaning of the safe-harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements about our future. Forward-looking statements may contain expectations regarding revenues, earnings, operations, share prices (including estimates or projections of the future prices of our shares), future market conditions, future compensation plans or policies, expenses and other results, future governance practices and may include statements of future performance, plans and objectives. Forward-looking statements also include statements pertaining to our strategies for future development of our businesses and products. Forward-looking statements represent only our belief regarding future events, many of which by their nature are inherently uncertain. It is possible that the actual results may differ materially from the anticipated results indicated in these forward-looking statements. Information regarding important factors that could cause actual results to differ from those in our forward-looking statements is contained in our Annual Report and other documents we file with the SEC. Any forward-looking statement speaks only as of the date on which that statement is made. We will not update any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made, except as required by applicable law. Other Important Information for Our Shareholders
Shareholder Proposals and Board Nominees for our 2026 Annual Meeting
Shareholder Proposals and Board Nominees for our 2026 Annual Meeting Shareholders may submit proposals and director nominees for our 2026 annual meeting in compliance with the rules and regulations of the SEC and our Bylaws. Proposals submitted to us for inclusion in our proxy materials must be received by us no later than November 27, 2025 pursuant to SEC’s Rule 14a-8 under the Exchange Act. Proposals and nominees submitted to us for presentation at our annual meeting, but not included in our proxy materials, must be received by us no earlier than January 23, 2026 and no later than February 26, 2026 pursuant to our Bylaws. All submissions should be sent to Roland T. Kelly, Chief Legal Officer, General Counsel and Corporate Secretary, 2945 Townsgate Road, Suite 110, Westlake Village, California 91361.