DEF 14A of Pra Group Inc
Filed Apr 30, 2025 · FY20240001193125-25-105937
Director Compensation
Director Compensation Our Board, upon the recommendation of the Compensation Committee, establishes the compensation for our non-employee directors. Non-employee director compensation for 2024 included annual cash retainers for our Board members, Chairman, Committee members, Committee Chairs and our Lead Independent Director. On the date of our 2024 Annual Meeting, each non-employee director also received an equity award valued at approximately $155,000 that consisted of restricted stock units (“RSUs”) that vest on the anniversary of the grant date or the date of the next annual meeting of the Company’s stockholders that follows the grant date, if earlier. The vesting schedule for the RSUs and the director stock ownership guidelines described below are intended to align our non-employee directors’ economic interests with those of our stockholders. Cash retainers for our Board for 2024 were as follows:
Director Compensation
| Annual Cash Retainers | 2024 | | Chairman | $125,000 | | Lead Independent Director | $30,000 | | Audit Committee Chair | $30,000 | | Compensation Committee Chair | $30,000 | | Nominating and Corporate Governance Committee Chair | $30,000 | | Risk Committee Chair | $30,000 | | Board Member | $70,000 | | Audit Committee Member | $15,000 | | Compensation Committee Member | $15,000 | | Nominating and Corporate Governance Committee Member | $15,000 | | Risk Committee Member | $15,000 |
Director Compensation
Note that Committee Chairs only receive a retainer for their service as Committee Chairs and not also for serving as Committee Members. Also, effective April 1, 2025, Mr. Fredrickson will only receive compensation as Executive Chairman, and will no longer receive compensation for his service as a director. Our non-employee directors received the following compensation for service during 2024:
Director Compensation
| Name(1) | Fees Earned or Paid in Cash | Stock Awards(2) | Total | | Danielle M. Brown(3) | $75,000 | $ — | $75,000 | | Marjorie M. Connelly | $115,000 | $154,991 | $269,991 | | John H. Fain(4) | $50,000 | $ — | $50,000 | | Steven D. Fredrickson | $195,000 | $154,991 | $349,991 | | Dame Jayne-Anne Gadhia(5) | $46,250 | $154,995 | $201,245 | | Glenn P. Marino(6) | $67,500 | $191,969 | $259,469 | | James A. Nussle(7) | $50,000 | $ — | $50,000 | | Geir L. Olsen | $92,500 | $154,991 | $247,491 | | Brett L. Paschke | $115,000 | $154,991 | $269,991 | | Scott M. Tabakin | $115,000 | $154,991 | $269,991 | | Peggy P. Turner | $100,000 | $154,991 | $254,991 | | Lance L. Weaver | $137,500 | $154,991 | $292,491 | | (1) Mr. Butler was elected to our Board effective January 1, 2025 and therefore did not receive any compensation in 2024. (2) Amounts represent the aggregate grant date fair value of the director equity awards granted calculated by multiplying the number of RSUs granted by the closing price of our common stock on the grant date, which was $19.83 on June 13, 2024. The actual amount of compensation realized by a director will depend upon the market price of our common stock on the vesting date. (3) Ms. Brown resigned as a director on August 1, 2024, resulting in the forfeiture of her 2024 director stock award. (4) Mr. Fain did not stand for re-election at the 2024 Annual Meeting. (5) Ms. Gadhia was elected to our Board effective June 13, 2024. The stock award amount represents the aggregate grant date fair value of stock awards granted on June 24, 2024 at $20.37 per share. (6) Mr. Marino was elected to our Board effective March 15, 2024 and was granted a prorated equity award for his service in the first quarter of 2024. Mr. Marino also received the 2024 director annual stock award. The stock award amount represents the aggregate grant date fair value of stock awards granted on March 15, 2024 at $22.84 per share, and June 13, 2024 at $19.83 per share. (7) Mr. Nussle did not stand for re-election at the 2024 Annual Meeting. | | | |
Director Compensation
In addition to the compensation described above, each non-employee director is reimbursed for travel expenses incurred for attending Board meetings and reasonable expenses associated with participating in continuing education programs. We offer no retirement benefits or perquisites to directors. We maintain directors’ and officers’ liability insurance policies covering all directors.
Proposal 1: Election of Directors
Proposal 1: Election of Directors Directors are elected at each annual meeting to serve until the next annual meeting and until their successors are duly elected and qualified. Each director nominee was nominated by our Board for election upon the recommendation of the Nominating and Corporate Governance Committee. Moreover, each nominee was elected previously by our stockholders except for Mr. Butler, who was elected by our Board effective January 1, 2025. Our Board currently consists of 11 directors. In connection with Mr. Atal’s retirement as the Company’s President and CEO on June 17, 2025, he will retire from the Board effective immediately following the Annual Meeting. Additionally, Mr. Marino notified the Company of his decision to retire from the Board immediately following the Annual Meeting. As a result, neither Mr. Atal nor Mr. Marino will stand for re-election at the Annual Meeting. As of the date of the Annual Meeting, our Board will be reduced to 9 directors. Proxies cannot be voted for a greater number of individuals than the number of nominees. Nominees for director who receive the affirmative votes of a majority of the votes cast in person or by proxy at the Annual Meeting will be elected. Any nominee for director who does not receive the affirmative vote of a majority of the votes cast must offer promptly in writing to submit the director’s resignation to our Board. The Nominating and Corporate Governance Committee will then consider the offer and will recommend to our full Board what action should be taken. Our Board will consider all factors it deems relevant to the best interests of the Company and our stockholders and determine whether to accept the director’s resignation within a reasonable period of time after certification of the election results. Each nominee has consented to serve as a director if elected. We have no reason to believe that any of the nominees will be unable or unwilling for good cause to serve. However, if any nominee should become unable or unwilling to serve, proxies may be voted for another person nominated as a substitute by our Board or our Board may reduce the number of directors. If our Board nominates a substitute, the shares represented by all valid proxies will be voted for that nominee. We did not receive any nominations or recommendations for director from stockholders for consideration at the Annual Meeting.
Proposal 1: Election of Directors
| | | OUR BOARD RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF EACH DIRECTOR NOMINEE. |
Philosophy and Objectives of Our Executive Compensation Program
| Pay for Performance | Competitive Pay | Stockholder Alignment | Culture | | • A significant portion of executive compensation is variable (at-risk) and linked to the Company’s performance. • We provide differentiated pay based on each executive’s individual contributions to the Company’s performance. | • Our compensation program is designed to attract, retain and motivate highly skilled executives, while promoting internal pay equity and emerging trends in executive compensation to remain competitive with the Company’s Compensation Peer Group (listed on page 31) and market data from similarly-sized companies. • We seek to maximize the financial efficiency of the overall executive compensation program from tax, accounting, and cash flow perspectives. | • Our compensation program is designed to drive the attainment of the Company’s short- and long-term financial and strategic objectives, creating alignment of interests between executives and stockholders. • We consider the results of the annual advisory vote by stockholders on the Company’s compensation of its NEOs along with corporate governance best practices. | • We consider effective human capital management practices and foster a highly engaged, high-performance culture that values equity, diversity and inclusion while promoting a culture of compliance and adherence to applicable regulatory requirements and risk management practices. |
Key Features of our Executive Compensation Program
| What We Do: | What We Don’t Do: | | ✓ Pay for Performance: A significant portion of our NEOs’ target annual compensation is variable and at-risk based on achievement of established performance goals. ✓ Use of Peer Group: We target total direct compensation at the median of our Compensation Peer Group. ✓ Retention-Oriented Equity Awards: We enhance executive officer retention by providing a portion of our long-term equity program in time-based awards with multi-year vesting schedules. ✓ Independent Compensation Consultant: The Compensation Committee, which is comprised solely of independent directors, engages an independent executive compensation consultant (“compensation consultant”) to advise it on executive compensation matters. ✓ Company-Favorable Restrictive Covenants: We maintain strong restrictive covenants in our employment agreements for our NEOs and obtain enhanced restrictive covenants in connection with our equity grants. ✓ Stock Ownership Guidelines: We have stock ownership guidelines of 5 times salary for our CEO and Board members and 3 times salary for all other executive officers. ✓ Clawback Policy: We have a compensation recovery policy that requires the Company to clawback incentive-based compensation received by our executive officers in the event of certain accounting restatements. | × No Excessive Risk-Taking: We design our compensation programs to discourage our employees, including our NEOs, from taking unnecessary or excessive risks. × No Guaranteed Minimum Payouts: We do not have guaranteed minimum payouts on our annual bonus or long-term incentive plans. × No Guaranteed Salary Increase: We do not provide automatic base salary increases to our executive officers. × No Tax Gross-ups: We do not provide our NEOs with excise tax gross-ups. × No “Single Trigger” Equity Vesting: We do not accelerate the vesting of equity awards on a change in control of the Company or upon a termination of employment unless such termination occurs within six months before or 24 months following such change in control or in the event of the NEO’s death or disability. × Minimal Perquisites: We generally do not provide our executive officers with perquisites or other personal benefits. × No Executive Deferred Compensation Plans: We do not offer nonqualified deferred-compensation plans or arrangements to our executive officers. × No Hedging or Pledging: We do not permit hedging or pledging of Company shares. |
Key Elements of our 2024 Compensation Program
| | Element | | Key Characteristics | Primary Objectives | | FIXED PAY | Annual Compensation | | | | | | Base Salary | | Cash | Attracts, retains and rewards NEOs by providing a fixed source of income to reflect experience, skills and competencies. | | | | | Reviewed annually and generally targeted at the Compensation Peer Group median, subject to individual performance and internal pay equity. | | | AT-RISK PAY | Short-Term Incentive Awards | | | | | | Annual Bonus | | Cash | Focuses NEOs on our annual results and aligns NEOs’ interests with those of our stockholders by rewarding performance focused on the achievement of established financial metrics and strategic objectives. | | | | | Variable cash compensation component based on performance against established financial metrics and strategic objectives. Final payout is based on the Compensation Committee’s analysis of the Company’s performance against the established financial metrics and strategic objectives, in addition to the Company’s performance and our executive officer’s individual performance. | | | | Long-Term Incentive Awards | | | | | | 50% Performance Stock Units (“PSUs”) 50% Restricted Stock Units (“RSUs”) | | Common Stock | Aligns the interests of our NEOs with those of our stockholders by linking a substantial portion of NEO compensation to stock price performance and the achievement of long-term Company financial goals. Provides opportunities for stock ownership, which attracts and motivates our NEOs and promotes retention. | | | | | PSUs vest after a three-year performance period, based on the achievement of established financial metrics and stock price performance. RSUs vest annually over a three-year period. | | | | | | | |
2024 Executive Compensation Decisions
| Before Year End | The Compensation Committee begins with a review of our executive compensation program, including its design components, compensation levels and competitiveness against our Compensation Peer Group to determine if any changes should be made to the program for the next fiscal year. | | At Beginning of Year | The Compensation Committee determines the principal components of compensation and sets the financial and strategic metrics for our short- and long-term incentive plans for our executive officers to drive our corporate goals and strategic objectives while holding our executive officers accountable for their performance. | | During the Year | The Compensation Committee meets regularly throughout the year, with management and in executive session, and reviews the Company’s performance to date against the established financial and strategic objectives. | | After Year End | After year end, the Compensation Committee reviews the Company’s performance against the established financial metrics and strategic objectives and each NEOs performance, and makes annual compensation decisions for our short-and long-term incentive plans that are consistent with our executive compensation philosophy and objectives. |
2024 Executive Compensation Decisions
Annual Bonus Plan The Annual Bonus Plan is a short-term incentive plan designed to reward our executive officers, including our NEOs. At the beginning of each year, the Compensation Committee establishes performance metrics, typically a combination of financial metrics and strategic objectives that are intended to drive near-term execution and progress against longer-term business objectives and priorities. The Compensation Committee also sets the corresponding performance goals to determine payout outcomes under the Annual Bonus Plan. The target award opportunities are based on a percentage of the executive officer’s base salary (exclusive of any other compensation or benefits) and are payable in cash upon the achievement of a threshold performance level and capped by a maximum performance level as established by the Compensation Committee. 2024 Annual Bonus Plan Design For 2024, the Compensation Committee approved the financial metrics and strategic objectives set forth in the table below upon the recommendation of the CEO:
2024 Executive Compensation Decisions
| Performance Metrics | Weight | Rationale | | Net Income, as adjusted(1) | 50% | We believe that net income, as adjusted provides a clear, transparent and objective measure of performance that aligns with stockholder value. | | Adjusted EBITDA(2) | 30% | We believe that Adjusted EBITDA helps provide enhanced period-to-period comparability of the Company’s operational and financial performance and is useful to investors as other companies in the industry report similar financial measures. | | Strategic Objectives | 20% | We believe our strategic objectives add accountability for driving results linked to the Company’s strategic goals. Strategic objectives for the year related to leveraging low-cost locations, expanding seller relationships, broadening access to funding and developing insights to provide incremental customer value and revenue. |
2024 Annual Bonus Plan Results and Payout
2024 Annual Bonus Plan Results and Payout The following table shows the financial performance necessary to achieve threshold (50% payout), target (100% payout), and maximum (200% payout) bonus amounts, along with actual results for 2024. Payouts are linearly interpolated for performance between threshold and maximum.
2024 Annual Bonus Plan Results and Payout
| | Threshold ($M) | Target ($M) | Maximum ($M) | Actual(1) | Payout (as a% of Target) | | Net Income | $56.8 | $71 | $88.75 | $75 | 125% | | Adjusted EBITDA | $1,008 | $1,260 | $1,575 | $1,147 | 78% | | Strategic Objectives | Significantly exceeded expectations in leveraging low-cost locations, expanding seller relationships, and broadening access to funding. Innovation and customer insight initiatives also advanced, supporting longer-term strategic objectives. (See “2024 Key Financial and Operational Highlights” in this CD&A.) | | | | 150% |
2024 Annual Bonus Plan Results and Payout
| (1) Reflects adjustments for material unplanned expenses (as approved by the Compensation Committee) for select legal expenses and costs related to site closures, partially offset by certain one-time tax benefits. These adjustments were intended to support decision-making that promotes the long-term health of the business and remain consistent with the intent of our established performance goals. |
2024 Annual Bonus Plan Results and Payout
Following the end of the year, the Compensation Committee considered the Company’s 2024 financial and strategic performance in addition to our NEOs’ accomplishments as described in the “Executive Summary” of this CD&A and determined that the Annual Bonus payout was 120% for each NEO, as shown in the table below.
2024 Annual Bonus Plan Results and Payout
| NEO | 2024 Bonus Target | 2024 Bonus Paid | Bonus Paid as a Percentage of Target | | Vikram A. Atal | $1,187,500 | $1,425,000 | 120% | | Rakesh Sehgal | $500,000 | $600,000 | 120% | | Martin Sjolund(1) | $486,800 | $584,160 | 120% | | Latisha O. Tarrant | $500,000 | $600,000 | 120% | | R. Owen James(1) | $389,500 | $467,400 | 120% |
2024 Annual Bonus Plan Results and Payout
| (1) Converted to U.S. dollars from British pounds using a December 31, 2024 conversion rate of £1.00 = $ $1.2511. |
2024 Annual Bonus Plan Results and Payout
Long-Term Incentive Plan (“LTIP”) Awards Equity awards, which are made under our 2022 Omnibus Incentive Plan (“2022 Equity Plan”), are intended to focus executives on increasing long-term stockholder value, enhance executive retention and promote executive stock ownership. The Compensation Committee generally grants annual LTIP awards in March. The Compensation Committee sets target LTIP award amounts for all executives, including our NEOs, based on several factors, including comparative peer and market compensation data for each NEO position in the Compensation Peer Group, the percentage of total direct compensation that is equity-based, equity burn-rate and overhang, LTIP performance goals, the Company’s financial performance and retention considerations. No single factor is given greater weight than any other in the decision-making process. The LTIP awards are delivered using a mix of PSUs and RSUs, with the ratio determined by the Compensation Committee.
2024 Annual Bonus Plan Results and Payout
| • | The PSU component is designed to align the interests of our executive officers with those of our stockholders by focusing on the Company’s long-term goals and maximizing stockholder returns over a three-year period tied to financial metrics and stock price performance. PSUs are granted annually with performance metrics set by the Compensation Committee at the beginning of the three-year performance period. Any awards earned cliff vest at the end of the three-year measurement period based on continued employment and Company achievement of the financial metrics and stock price performance. |
2024 Annual Bonus Plan Results and Payout
| • | The RSU component is designed to retain highly skilled executives, align the interests of our executive officers with those of our stockholders and promote stock ownership by our executive officers. RSUs are granted annually and vest ratably over three years. |
2024 Annual Bonus Plan Results and Payout
2024 LTIP Award Design and Grants For 2024, the Compensation Committee determined that our NEOs’ 2024 LTIP awards would consist of a mix of 50% PSUs and 50% RSUs, which is consistent and aligns closely with equity compensation market practices of our Compensation Peer Group. The Compensation Committee selected the following three performance metrics for the PSUs awarded for the 2024 LTIP: (i) Adjusted EBITDA, (ii) Relative Total Shareholder Return (“Relative TSR”), and (iii) Return On Average Tangible Equity (“ROATE”). The Compensation Committee believes Adjusted EBITDA, Relative TSR and ROATE are the most appropriate metrics for measuring performance under the LTIP as they encourage our executive officers to focus on actions to improve the long-term financial health and performance of the Company, with an emphasis on value creation for our stockholders. Adjusted EBITDA, Relative TSR and ROATE metrics are independent of each other, and the 2024 LTIP awards can be earned for each metric individually based on performance achievement. A description of each PSU performance metric for the 2024 LTIP is set forth below.
2024 Annual Bonus Plan Results and Payout
| PSU Performance Metrics: |
2024 Annual Bonus Plan Results and Payout
Adjusted EBITDA:
2024 Annual Bonus Plan Results and Payout
| • | Is a supplemental measure of operations and financial performance, as it excludes certain items whose fluctuations from period to period do not necessarily correspond to changes in the operations of our business, and is useful to investors as other companies in the industry report similar financial measures. Adjusted EBITDA should not be considered as an alternative to net income determined in accordance with GAAP. Adjusted EBITDA is calculated starting with our GAAP financial measure, Net Income/(loss) attributable to PRA Group, Inc. plus income tax expense (or less income tax benefit); plus foreign exchange loss (or less foreign exchange gain); plus interest expense, net; plus other expense (or less other income); plus depreciation and amortization; plus impairment of real estate; plus net income attributable to noncontrolling interests; and plus recoveries collected and applied to finance receivables, net less changes in expected recoveries, further adjusted to exclude the impact of foreign exchange rate fluctuations, and changes in accounting principles and tax laws. |
2024 Annual Bonus Plan Results and Payout
| • | Is based upon the Company’s achievement of the cumulative Adjusted EBITDA metric goal over the 2024-2026 performance period. The three-year cumulative Adjusted EBITDA will be used to determine the percentage of target PSUs vested. |
2024 Annual Bonus Plan Results and Payout
Relative TSR:
2024 Annual Bonus Plan Results and Payout
| • | Is measured over the 2024-2026 performance period based on the Company’s performance compared to the companies in the S&P SmallCap 600 Financial Sector Index. The number of PSUs earned will be determined by the Company’s Relative TSR performance over this performance period. The beginning share price will be the average closing price for 30 calendar days immediately preceding the first day of the performance period and the ending share price will be the average closing price for the last 90 calendar days of the performance period. |
2024 Annual Bonus Plan Results and Payout
ROATE:
2024 Annual Bonus Plan Results and Payout
| • | Is a supplemental measure of performance that is not required by, or presented in accordance with, GAAP, used to monitor and evaluate operating performance relative to our equity. Average tangible equity is defined as average Total stockholders’ equity - PRA Group, Inc. less average goodwill and average other intangible assets. ROATE is calculated by dividing Net Income/(loss) attributable to PRA Group, Inc. by average tangible equity. |
2024 Annual Bonus Plan Results and Payout
| • | Is based upon the Company’s ROATE, which will be calculated annually, over the 2024-2026 performance period. The three-year average will be used to determine the percentage of target PSUs earned. |
2024 Annual Bonus Plan Results and Payout
The table below sets forth the PSU performance metrics at target for 2024:
2024 Annual Bonus Plan Results and Payout
| Adjusted EBITDA(1) | | Relative TSR(1) | | ROATE(1) | | | Performance vs. Target | Target Shares Earned (%) | Value | Target PSUs Earned (%) | Value | Target Shares Earned (%) | | Less than 80% | 0% | Below 30th percentile | 0% | Less than 80% | 0% | | 80% | 50% | 30th percentile | 50% | 80% | 50% | | 90% | 75% | 50th percentile | 100% | 90% | 75% | | 100% | 100% | 70th percentile | 150% | 100% | 100% | | 112.5% | 150% | 90th percentile or more | 200% | 112.5% | 150% | | 125% or more | 200% | | | 125% or more | 200% |
2024 Annual Bonus Plan Results and Payout
| (1) Linear interpolation is performed to determine target shares earned between values. |
2024 Annual Bonus Plan Results and Payout
The table below sets forth the annual LTIP award values granted at target for 2024 for each NEO:
2024 Annual Bonus Plan Results and Payout
| NEO | 2024 LTIP Awards | | | | | | PSUs at Target | | RSUs | | | | # of Units(1) | Grant Date Value ($) | # of Units(1) | Grant Date Value ($) | | Vikram A. Atal | 94,824 | $2,400,000 | 94,824 | $2,400,000 | | Rakesh Sehgal | 15,804 | $400,000 | 15,804 | $400,000 | | Martin Sjolund(3) | 24,694 | $625,005 | 24,693 | $624,980 | | LaTisha O. Tarrant | 19,755 | $500,000 | 19,755 | $500,000 | | R. Owen James | 15,804 | $400,000 | 15,804 | $400,000 |
2024 Annual Bonus Plan Results and Payout
| (1) The number of PSUs and RSUs granted was based on the total grant date value divided by the closing price of our common stock on March 7, 2024. |
2024 Annual Bonus Plan Results and Payout
In March 2024, in response to the significant executive leadership transitions and organizational changes in 2023, as well as challenges inherited by the new executive leadership team and their early accomplishments, the Compensation Committee approved a one-time RSU award to each of our NEOs, other than Mr. Atal. These awards, each with a grant date value of $100,000, will vest on March 7, 2026, subject to continued employment. The Compensation Committee viewed these awards as a critical element in supporting a successful CEO transition and maintaining leadership continuity. These awards were designed to reinforce our NEOs’ focus on the Company’s financial turnaround and long-term sustainable growth.
2024 Annual Bonus Plan Results and Payout
| NEO | 2024 Retention Awards | | | | RSUs | | | | # of Units(1) | Grant Date Value ($) | | Rakesh Sehgal | 3,951 | $100,000 | | Martin Sjolund | 3,951 | $100,000 | | LaTisha O. Tarrant | 3,951 | $100,000 | | R. Owen James | 3,951 | $100,000 |
2024 Annual Bonus Plan Results and Payout
| (1) The number of RSUs granted was based on the total grant date value divided by the closing price of our common stock on March 7, 2024. |
2024 Annual Bonus Plan Results and Payout
Summary of Our Concurrent LTIP Awards Outstanding Following the grant of the 2024 LTIP awards, our NEOs had three tranches (award years 2022-2024) of LTIP awards outstanding. The key features of these outstanding awards are included below:
2024 Annual Bonus Plan Results and Payout
| LTIP Award Year | Measurement Period | Award Components | PSU Performance Metric | PSU Weighting | | 2022 | 2022-2024 | | Adjusted Revenues | 20% | | | | | Adjusted EBITDA | 20% | | | | 50% PSUs | Adjusted Net Income | 20% | | | | 50% RSUs | Revenue from Corporate Development | 20% | | | | | Stock Price Appreciation | 20% | | 2023 | 2023-2025 | 50% PSUs | Adjusted EBITDA | 50% | | | | 50% RSUs | Relative TSR | 50% | | 2024 | 2024-2026 | 50% PSUs 50% RSUs | Adjusted EBITDA | 33.33% | | | | | ROATE | 33.33% | | | | | Relative TSR | 33.33% |
2022 LTIP Results and Payouts
2022 LTIP Results and Payouts In February 2025, the Compensation Committee reviewed the results for the 2022-2024 performance period (January 1, 2022 to December 31, 2024) and determined that 23% of the PSUs granted under the 2022 LTIP were earned based on the Company’s performance on the following metrics:
2022 LTIP Results and Payouts
| 2022-2024 LTIP Performance Metrics | Target (100% Payout) | Actual Performance | Percentage Payout | | Adjusted Revenue(1) | $3,363 million | $2,884 million | 64% | | Adjusted EBITDA(2) | $4,022 million | $3,252 million | 52% | | Adjusted Net Income(3) | $405 million | $103 million | 0% | | Revenue from Corporate Development | $400 million | $0 million | 0% | | Stock Price Appreciation | $39.82 | $29.44 | 0% | | | | 2022 LTIP Payout | 23% |
2022 LTIP Results and Payouts
| (1) Revenue as reported in the Company’s consolidated financial statements prepared in accordance with GAAP, excluding the impact of changes in foreign exchange rates. |
2022 LTIP Results and Payouts
| (2) Net Operating Income per GAAP reported adjusted to remove Changes in Estimates and to add Depreciation, Amortization and Recoveries applied to negative allowance, and excluding the impact of changes in foreign exchange rates. |
2022 LTIP Results and Payouts
| (3) GAAP Net Income, excluding the impacts of changes in foreign exchange rates and gains or losses resulting from foreign exchange rates. |
Our Goal-Setting and Compensation Decision-Making Process
| • | evaluating the competitiveness of each NEO’s total compensation, including salary, annual bonus and long-term equity incentives; |
Our Goal-Setting and Compensation Decision-Making Process
| • | reviewing and approving corporate and individual performance goals and objectives for our incentive compensation plans; |
Our Goal-Setting and Compensation Decision-Making Process
| • | overseeing employment agreements, including the renewal process. |
Our Goal-Setting and Compensation Decision-Making Process
| • | analyzed each NEO’s compensation compared to our Compensation Peer Group and other survey data, including target and actual pay levels for each component, and in the aggregate, of our total direct compensation (salary, annual bonus award and annual equity grant) and the mix of our direct compensation components (fixed versus variable, short-term versus long-term and cash versus equity-based pay); |
Our Goal-Setting and Compensation Decision-Making Process
| • | reviewed and provided recommendations to the Compensation Committee on the composition of our Compensation Peer Group; |
Our Goal-Setting and Compensation Decision-Making Process
| • | evaluated the competitiveness of our long-term incentive plans, including their aggregate cost, the rate at which equity is awarded and their dilutive impact; |
Our Goal-Setting and Compensation Decision-Making Process
| • | reviewed and provided advice on our Executive Severance Plan in comparison to market best practices; |
Our Goal-Setting and Compensation Decision-Making Process
| • | provided a review of the Company’s non-employee director compensation program compared to our Compensation Peer Group. |
Our Goal-Setting and Compensation Decision-Making Process
| The Compensation Committee generally compares the compensation of our NEOs to the median of our Compensation Peer Group. In addition, the Compensation Committee considers factors such as our financial performance relative to our Compensation Peer Group, the unique characteristics of the individual NEO’s position, and any succession and retention concerns. To maintain the competitiveness of our executive compensation program, the Compensation Committee bases executive compensation decisions on competitive peer and market compensation data and pay practices. Annually, with input from Pearl Meyer, the Compensation Committee determines our Compensation Peer Group, which is intended to reflect companies that are comparable to us based on various metrics, including net income, market capitalization, complexity of operations and business model. The Compensation Committee approved the list of companies in the chart to the right as an appropriate peer group for making executive compensation decisions for 2024. The Company’s Compensation Peer Group changed from 2023 with (i) the removal of MoneyGram International due to an acquisition by Madison Dearborn Partners in 2023, (ii) the removal of WEX Inc., due to its large market capitalization relative to ours and (iii) the addition of NMI Holdings, Inc. and Regional Management Corporation based on various factors making them reasonably comparable to us. Factors considered in selecting our Compensation Peer Group include (y) revenue (generally falling in a range of 0.4 to 2.5 times our revenue) and (z) market capitalization (generally falling in a range of 0.25 to 4.0 times our market capitalization). | 2024 Compensation Peer Group | | | Credit Acceptance Corporation CSG Systems International, Inc. Encore Capital Group, Inc. Enova International, Inc. Green Dot Corporation LendingClub Corporation MGIC Investment Corporation Navient Corporation NMI Holdings, Inc. Onity Group Inc.(1) Regional Management Corporation Walker & Dunlop, Inc. World Acceptance Corporation |
Our Goal-Setting and Compensation Decision-Making Process
In addition to Compensation Peer Group data, the Compensation Committee reviews general industry compensation survey data reported by Willis Towers Watson. The Compensation Committee reviews the data related to the Compensation Peer Group and the Willis Towers Watson survey to ascertain the competitive market for our NEOs, to determine whether our compensation levels are competitive, and to make compensation adjustments to reflect executive performance and Company performance.
Other Programs, Practices and Policies
Other Programs, Practices and Policies Perquisites and Other Personal Benefits We generally do not provide our executive officers, including our NEOs, with perquisites or other personal benefits. We encourage our NEOs to submit to a comprehensive physical examination every three to five years at our expense, at a cost of approximately $5,000 each. We cover the cost of a comprehensive physical examination because we believe it serves a necessary business purpose and protects the interests of the Company and stockholders by requiring each NEO to receive high-quality preventative care, thereby increasing the likelihood of early detection for any serious illness that would prevent them from serving the Company to the best of their ability. Tax-qualified Retirement Plans We offer a 401(k) plan for our U.S. employees, including our NEOs. The 401(k) plan is a long-term savings vehicle that enables employees to make pre-tax and post-tax contributions via payroll deductions and receive tax-deferred earnings on the contributions made. Employees are eligible to make voluntary contributions to the plan of up to 100% of their compensation, subject to limitations under the Internal Revenue Code of 1986, as amended. We make matching cash contributions of up to 4% of each participating employee’s eligible pay after the employee completes six months of service with the Company. Employees are able to direct their own investments, among a range of investment choices, under the plan. We make contributions to our United Kingdom employees’ individual pensions under the Pensions Act 2008 of the Parliament of the United Kingdom, including our NEOs, up to the annual allowance before tax is payable. Nonqualified Deferred Compensation Plans and Arrangements We do not offer nonqualified deferred compensation plans or arrangements to any of our executive officers, including our NEOs. Severance and Change in Control Arrangements As part of our executive compensation program we provide certain severance and change in control benefits to our NEOs. Each NEO is entitled to receive severance benefits under either our Executive Severance Plan or under the terms of an employment agreement. We provide these severance benefits in order to provide an overall compensation package that is competitive with those offered by other companies with whom we compete for executive talent. Additionally, such severance benefits allow our executives to focus on the Company’s business objectives and the interests of our stockholders without concern for their employment security. Mr. Sehgal and Ms. Tarrant are currently the only participants in the Executive Severance Plan, which provides certain payments and other benefits upon a qualifying termination. Each of Messrs. Atal, Sjolund and James has entered into employment agreements with the Company, and are eligible for severance payments and other benefits upon a qualifying termination as set forth in their employment agreement. In the case of a termination for cause, no severance payments will be made to our NEOs. We do not provide excise tax reimbursements or gross-ups for severance payment and other benefits upon a qualifying termination. For detailed information on the estimated potential payments and benefits payable to our NEOs in the event of their termination of employment, including following a change in control of the Company, see the section below titled “Post-Employment Compensation Arrangements” in this Proxy Statement. Stock Ownership Guidelines We maintain stock ownership guidelines for our executive officers, including our NEOs (the “Guidelines”). Our Board believes in the importance of aligning the economic interests of stockholders and management. The Guidelines were established based on various factors, including executive officer roles, market data, corporate governance practices and the recommendations of the Compensation Committee’s compensation consultant. The Guidelines provide that the Compensation Committee may determine whether, based on the executive’s success in achieving the executive’s stock ownership target, to pay the executive’s annual bonus, if any, in stock, rather than in cash. The Compensation Committee is responsible for reviewing the Guidelines at least annually and recommending to our Board any changes to the Guidelines. In connection with its annual review, management provides the Compensation Committee with a report showing the extent to which our executives have met the requirements set forth in the Guidelines. This report includes targeted share ownership, actual share ownership, unvested RSUs (which count towards the Guidelines) and any surplus or deficiency that exists. Equity interests that count toward the satisfaction of the Guidelines include shares owned outright by the individual, shares jointly owned and unvested RSUs. Unearned PSUs do not count toward the Guidelines. Newly hired or promoted executives have five years from the date of the commencement of their appointment to attain these ownership levels. If an executive officer does not meet the applicable ownership level by the end of the five-year period, the executive officer is required to hold a minimum of 50% of the net shares resulting from any future vesting of RSUs or PSUs until the ownership level is met.
Other Programs, Practices and Policies
The Compensation Committee has determined that for 2024, all NEOs are in compliance with these Guidelines and have either achieved the required level of stock ownership or are within the five-year compliance period associated with their start date as an executive officer. Equity Award Grant Practices Equity awards to our employees, including our NEOs, are discretionary and must be approved by the Compensation Committee. The Company’s long-standing practice has been to grant annual equity awards on a predetermined schedule, usually following the release of our financial statements for the prior year. In addition, equity awards may be granted at other times during the year to new hires, employees receiving promotions and in other special circumstances. The Compensation Committee does not take material nonpublic information into account when determining the timing and terms of equity awards. The Company does not currently grant stock options. Clawback Policy We have adopted a Compensation Recovery Policy (“Clawback Policy”), that is intended to comply with the provisions of Exchange Act Section 10D, Exchange Act Rule 10D-1 and Nasdaq Stock Market Rule 5608, which require companies to adopt a formal policy outlining the recovery of incentive-based compensation in the event of certain accounting restatements. The Board has delegated the administration of the Clawback Policy to the Compensation Committee, which has full and final authority to make all determinations under the Clawback Policy. The Clawback Policy applies to all incentive-based compensation received by our executive officers after the effective date of the Clawback Policy. In the event of a triggering accounting restatement, the Compensation Committee is tasked with recovering in a reasonably prompt timeframe all incentive-based compensation received by a covered executive officer during the applicable recovery period in excess of the compensation that would have been received had the compensation been determined using the restated amounts. Tax Deductibility of Executive Compensation The Compensation Committee carefully considers the tax impacts of its compensation programs on the Company, as well as on its executives. It is the Compensation Committee’s intent to maximize tax deductibility to the extent reasonable, provided the Company’s programs remain consistent with the Company’s overall executive compensation objectives. While the Compensation Committee is mindful of potential tax implications, it reserves the right to adopt such compensation arrangements as may from time to time be desirable to reward, retain or attract highly skilled executives.
Summary Compensation Table
Summary Compensation Table The following table sets forth all compensation awarded to, earned by, or paid to each of our NEOs for all services rendered to the Company for the years ended December 31, 2024, 2023, and 2022(1).
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Stock Awards(2) ($) | Non-Equity Incentive Plan Comp(3) ($) | All Other Comp(4) ($) | Total ($) | | Vikram A. Atal | | | | | | | | President and Chief Executive Officer | 2024 | 950,000 | 5,129,030 | 1,425,000 | 13,800 | 7,517,830 | | | 2023 | 694,231 | 1,499,972 | 712,500 | 155,846 | 3,062,549 | | Rakesh Sehgal | | | | | | | | Executive Vice President & Chief Financial Officer | 2024 | 500,000 | 954,838 | 600,000 | 13,800 | 2,068,638 | | | 2023 | 432,492 | 458,386 | 265,000 | 29,451 | 1,185,329 | | Martin Sjolund(5) | | | | | | | | President, PRA Group Europe | 2024 | 486,803 | 1,435,669 | 584,264 | 33,600 | 2,540,336 | | | 2023 | 481,215 | 1,020,254 | 320,000 | 33,075 | 1,854,544 | | LaTisha O. Tarrant | | | | | | | | General Counsel & Chief Human Resources Officer | 2024 | 504,808 | 1,168,548 | 600,000 | 13,800 | 2,287,156 | | | 2023 | 576,923 | 765,077 | 265,000 | 13,200 | 1,620,200 | | R. Owen James(5) | | | | | | | | Executive Vice President, Global Investments Officer | 2024 | 389,467 | 954,838 | 467,411 | 29,210 | 1,840,926 | | | 2023 | 367,521 | 480,022 | 220,000 | 27,564 | 1,095,107 |
Summary Compensation Table
| (1) None of the NEOs for 2024 were NEOs in 2022, and therefore, the 2022 compensation information is not included. |
Summary Compensation Table
| (2) The amounts represent the aggregate grant date fair value of the stock awards granted in 2024 and 2023 determined pursuant to Accounting Standards Codification (“ASC”) Topic 718. The assumptions used in calculating these amounts are discussed in Note 1 and Note 11 to our consolidated financial statements in the 2024 Form 10-K. Stock awards consist of time-based RSUs and performance-based PSUs awarded under the LTIP (see page 29 for a description of the LTIP Awards). The actual amount of compensation that will be realized by the NEO at the time the stock award vests, if at all, will depend upon the market price of our common stock on the day prior to the vesting date. The value as of the grant date of the maximum number of shares that could vest under the 2024 LTIP PSU awards is as follows: Mr. Atal, $5,458,069; Mr. Sehgal, $909,678; Mr. Sjolund, $1,421,380; Ms. Tarrant, $1,137,098; and Mr. James, $909,678. For more information on the awards granted during 2024, see the Grants of Plan-Based Awards table (page 36). |
Summary Compensation Table
| (3) These amounts represent awards under the Annual Bonus Plan (see page 25 for a description of the Annual Bonus Plan). |
Summary Compensation Table
| (4) The amounts comprising “All Other Comp” for Messrs. Atal, and Sehgal and Ms. Tarrant represent Company matching contributions to the recipient’s 401(k) plan account up to the 2024 $13,800 limit for such plan under federal income tax rules. For Messrs. Sjolund and James, the amounts represent payments under the Pensions Act 2008 of the Parliament of the United Kingdom. For Mr. James, the amount includes Company pension contributions. For Mr. Sjolund, the amounts include cash payments in lieu of Company pension contributions. |
Summary Compensation Table
| (5) Messrs. Sjolund and James compensation was converted to U.S. dollars from British pounds using a December 31, 2024 conversion rate of £1.00 = $1.2511. |
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table presents, for each of our NEOs, information concerning awards under our 2022 Equity Plan and Annual Bonus Plan for 2024.
Grants of Plan-Based Awards
| Name | Award Type(1) | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(3) | | | | | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | All Other Stock Awards: Number of Shares of Stock or Units(4) | Grant Date Fair Value of Stock and Option Awards ($)(5) | | Vikram A. Atal | STI | | — | 1,187,500 | 5,000,000 | | | | | | | | RSU | 3/7/2024 | | | | | | | 94,824 | 2,399,995 | | | PSU | 3/7/2024 | | | | — | 94,824 | 189,648 | | 2,729,035 | | Rakesh Sehgal | STI | | — | 500,000 | 5,000,000 | | | | | | | | RSU | 3/7/2024 | | | | | | | 15,804 | 399,999 | | | PSU | 3/7/2024 | | | | — | 15,804 | 31,608 | | 454,839 | | | RSU | 3/7/2024(6) | | | | | | | 3,951 | 100,000 | | Martin Sjolund(7) | STI | | — | 486,803 | 5,000,000 | | | | | | | | RSU | 3/7/2024 | | | | | | | 24,693 | 624,980 | | | PSU | 3/7/2024 | | | | — | 24,694 | 49,388 | | 710,690 | | | RSU | 3/7/2024(6) | | | | | | | 3,951 | 100,000 | | LaTisha O. Tarrant | STI | | — | 500,000 | 5,000,000 | | | | | | | | RSU | 3/7/2024 | | | | | | | 19,755 | 499,999 | | | PSU | 3/7/2024 | | | | — | 19,755 | 39,510 | | 568,549 | | | RSU | 3/7/2024(6) | | | | | | | 3,951 | 100,000 | | R. Owen James(7) | STI | | — | 389,467 | 5,000,000 | | | | | | | | RSU | 3/7/2024 | | | | | | | 15,804 | 399,999 | | | PSU | 3/7/2024 | | | | — | 15,804 | 31,608 | | 454,839 | | | RSU | 3/7/2024(6) | | | | | | | 3,951 | 100,000 |
Grants of Plan-Based Awards
| (1) During 2024, our NEOs were awarded the following plan-based awards: annual short-term incentive (“STI”) awards under our Annual Bonus Plan and time-based RSUs and performance-based PSUs under our LTIP. |
Grants of Plan-Based Awards
| (2) The amounts represent the range of possible payouts of the STI from $0, at threshold, to 200% of target, at maximum. While our Annual Bonus Plan sets the maximum amount payable to a participant for a performance period at $5,000,000, over the past 10 years the maximum payment to any NEO has not exceeded 200%, equivalent to $2,375,000 for Mr. Atal, $1,000,000 for Mr. Sehgal and Ms. Tarrant, respectively, $967,606 for Mr. Sjolund and $778,934 for Mr. James. |
Grants of Plan-Based Awards
| (3) The amounts represent the range of possible payouts of the PSUs from 0% of target, at threshold, to 200% of target, at maximum. The PSUs will not vest if the performance criteria are not met. Vesting of the PSUs is based on the achievement of goals with respect to three metrics (Adjusted EBITDA, ROATE and Relative TSR) over the 2024-2026 performance period, subject to continued employment. |
Grants of Plan-Based Awards
| (4) The amounts represent RSUs. One-third of the RSUs vest on each of the first, second and third anniversary of the grant date, subject to continued employment |
Grants of Plan-Based Awards
| (5) The amounts represent the aggregate grant date fair value of each award, calculated by multiplying the fair value on the grant date by the number of RSUs and the target number of the PSUs. The fair value of the RSUs is based on the closing price of the Company’s common stock on the grant date of March 7, 2024. The fair value of the PSUs is based on $35.72 per share for the Relative TSR performance metric, a market condition, and $25.31 per share, the closing price of our common stock on the grant date, for the other two performance metrics, Adjusted EBITDA and ROATE. |
Grants of Plan-Based Awards
| (6) The amounts represent RSUs, which 100% vest on the second anniversary of the grant date. |
Grants of Plan-Based Awards
| (7) Messrs. Sjolund and James compensation was converted to U.S. dollars from British pounds using a December 31, 2024 conversion rate of £1.00 = $1.2511. |
Outstanding Equity Awards at Fiscal-Year End
Outstanding Equity Awards at Fiscal-Year End The following table provides information on our NEOs’ outstanding unvested equity awards as of December 31, 2024. No options were outstanding as of December 31, 2024.
Outstanding Equity Awards at Fiscal-Year End
| Name | Grant Date | Number of Shares or Units of Stock That Have Not Vested(1) (#) | Market Value of Shares of Stock that Have Not Vested(2) ($) | Equity Incentive Plan Awards: Number of Unearned Shares Units or Other Rights That Have Not Vested (#)(3) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares Units or Other Rights That Have Not Vested ($)(2)(3) | | Vikram A. Atal | 4/15/2023 | 25,853 | 540,069 | — | — | | | 3/7/2024 | 94,824 | 1,980,873 | 94,824 | 1,980,873 | | Rakesh Sehgal | 5/15/2022 | 7,863 | 164,258 | — | — | | | 3/7/2023 | 2,010 | 41,989 | 3,014 | 62,962 | | | 9/15/2023 | 5,472 | 114,310 | — | — | | | 3/7/2024 | 15,804 | 330,146 | 15,804 | 330,146 | | | 3/7/2024(4) | 3,951 | 82,536 | — | — | | Martin Sjolund | 3/7/2022 | 3,341 | 69,793 | 10,022 | 209,360 | | | 3/7/2023 | 7,234 | 151,118 | 10,851 | 226,677 | | | 3/7/2024 | 24,693 | 515,837 | 24,694 | 515,858 | | | 3/7/2024(4) | 3,951 | 82,536 | — | — | | LaTisha O. Tarrant | 3/7/2022 | 557 | 11,636 | 1,670 | 34,886 | | | 11/15/2022 | 539 | 11,260 | — | — | | | 3/7/2023 | 2,412 | 50,387 | 3,617 | 75,559 | | | 8/15/2023 | 14,819 | 309,569 | — | — | | | 3/7/2024 | 19,755 | 412,682 | 19,755 | 412,682 | | | 3/7/2024(4) | 3,951 | 82,536 | — | — | | R. Owen James | 3/7/2022 | 743 | 15,521 | 2,227 | 46,522 | | | 3/7/2023 | 1,809 | 37,790 | 2,712 | 56,654 | | | 8/15/2023 | 7,845 | 163,882 | — | — | | | 3/7/2024 | 15,804 | 330,146 | 15,804 | 330,146 | | | 3/7/2024(4) | 3,951 | 82,536 | — | — |
Outstanding Equity Awards at Fiscal-Year End
| (1) The RSUs granted vest ratably over a three-year period, beginning on the first anniversary of the award date subject to the terms of the respective RSU agreement. |
Outstanding Equity Awards at Fiscal-Year End
| (2) The amounts represent the fair market value of the awards, calculated using $20.89, the closing price of the Company’s common stock on December 31, 2024. |
Outstanding Equity Awards at Fiscal-Year End
| (3) The performance component of the LTIP awards will not vest or be awarded if we do not achieve the minimum threshold performance targets pursuant to the terms of the respective PSU agreement, as described more fully on page 27. If such targets are met, the number of shares to be received by each NEO will be determined based on actual performance (for each year). The PSU award performance period is three years, beginning on January 1 of the year of the grant and ending in three years on December 31. |
Outstanding Equity Awards at Fiscal-Year End
| (4) The RSUs granted vest two years from the grant date, subject to the terms of the respective RSU agreement. |
Stock Vested
Stock Vested The following table provides information concerning the shares acquired on vesting of RSUs and PSUs during 2024 on an aggregated basis for each of our NEOs, and includes the value realized upon vesting. During 2024, we had no stock options outstanding and awarded no stock options.
Stock Vested
| Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(1)(2) | | Vikram A. Atal | 12,926 | 315,265 | | Rakesh Sehgal | 3,740 | 84,078 | | Martin Sjolund | 15,715 | 388,003 | | LaTisha O. Tarrant | 11,170 | 255,602 | | R. Owen James | 7,902 | 184,864 | | (1) The amounts represent the aggregate dollar amount realized upon vesting, computed by multiplying the number of shares of stock by the closing market price of our common stock on the day prior to the vesting date. (2) On February 12, 2025, the Compensation Committee determined the final payment of PSUs earned under the 2022 LTIP for the three-year period ended December 31, 2024, based on the Company’s financial results and, as a result, this table does not reflect the number of shares acquired or value realized on vesting. | | |
Stock Vested
The following table provides detailed vesting information of the value realized upon vesting of stock awards:
Stock Vested
| Name | Award Type | Vesting Date | Number of Shares (#)(1) | Closing Market ($)(2) | Value Realized on Vesting ($) | | Vikram A. Atal | RSU | 4/15/2024 | 12,926 | 24.39 | 315,265 | | Rakesh Sehgal | RSU | 3/7/2024 | 1,004 | 24.69 | 24,789 | | | RSU | 9/15/2024 | 2,736 | 21.67 | 59,289 | | Martin Sjolund | PSU | 3/7/2024 | 5,420 | 24.69 | 133,820 | | | RSU | 3/7/2024 | 10,295 | 24.69 | 254,184 | | LaTisha O. Tarrant | PSU | 3/7/2024 | 903 | 24.69 | 22,295 | | | RSU | 3/7/2024 | 2,318 | 24.69 | 57,231 | | | RSU | 8/15/2024 | 7,409 | 22.08 | 163,591 | | | RSU | 11/15/2024 | 540 | 23.12 | 12,485 | | R. Owen James | PSU | 3/7/2024 | 1,444 | 24.69 | 35,652 | | | RSU | 3/7/2024 | 2,536 | 24.69 | 62,614 | | | RSU | 8/15/2024 | 3,922 | 22.08 | 86,598 | | (1) On February 12, 2025, the Compensation Committee determined the final payment of PSUs earned under the 2022 LTIP for the three-year period ended December 31, 2024, based on the applicable criteria for the award and, as a result, this table does not reflect the number of shares acquired or value realized on vesting. (2) The closing market price of our common stock used to calculate value of shares at vesting is the trading day prior to the vesting date. | | | | | |
Potential Payments Upon a Termination or Change in Control
Potential Payments Upon a Termination or Change in Control The amounts in the following table were calculated based upon employment agreements in effect and participation in the Executive Severance Plan as of December 31, 2024. Amounts reflect an assumed termination date of December 31, 2024, and use the full year target non-equity incentive plan awards.
Potential Payments Upon a Termination or Change in Control
| Name | Type of Payment or Benefit | Involuntary Termination without Cause/Constructive Termination, not during a Change in Control Protection Period ($)(1) | Involuntary Termination without Cause/Constructive Termination during a Change in Control Protection Period ($)(2)(3) | Disability ($) | Death ($) | | Vikram A. Atal | Severance Payment – Base Salary | 1,425,000 | 1,900,000 | — | — | | | Severance Payment – Non-Equity Incentive Award | 1,781,250 | 2,375,000 | — | — | | | Pro-Rata Bonus | — | — | — | — | | | Equity(4) | — | 4,501,816 | 4,501,816 | 4,501,816 | | | Benefits | 24,902 | 24,902 | — | — | | | Total | 3,231,152 | 8,801,718 | 4,501,816 | 4,501,816 | | Rakesh Sehgal | Severance Payment – Base Salary | 500,000 | 750,000 | — | — | | | Severance Payment – Non-Equity Incentive Award | 500,000 | 750,000 | — | — | | | Pro-Rata Bonus | — | — | — | — | | | Equity(4) | — | 1,126,347 | 1,126,347 | 1,126,347 | | | Benefits | 31,280 | 46,921 | — | — | | | Total | 1,031,280 | 2,673,268 | 1,126,347 | 1,126,347 | | Martin Sjolund(5) | Severance Payment – Base Salary | 240,608 | 240,608 | — | — | | | Severance Payment – Non-Equity Incentive Award | — | — | — | — | | | Pro-Rata Bonus | — | — | — | — | | | Equity(4) | — | 1,771,180 | 1,771,180 | 1,771,180 | | | Benefits | — | — | — | — | | | Total | 240,608 | 2,011,788 | 1,771,180 | 1,771,180 | | LaTisha O. Tarrant | Severance Payment – Base Salary | 500,000 | 750,000 | — | — | | | Severance Payment – Non-Equity Incentive Award | 500,000 | 750,000 | — | — | | | Pro-Rata Bonus | — | — | — | — | | | Equity(4) | — | 1,401,197 | 1,401,197 | 1,401,197 | | | Benefits | 7,095 | 10,642 | — | — | | | Total | 1,007,095 | 2,911,839 | 1,401,197 | 1,401,197 | | R. Owen James(5) | Severance Payment – Base Salary | 367,521 | 367,521 | — | — | | | Severance Payment – Non-Equity Incentive Award | — | — | — | — | | | Pro-Rata Bonus | — | — | — | — | | | Equity(4) | — | 1,063,197 | 1,063,197 | 1,063,197 | | | Benefits | — | — | — | — | | | Total | 367,521 | 1,430,718 | 1,063,197 | 1,063,197 |
Potential Payments Upon a Termination or Change in Control
| (1) For Mr. Atal, termination without “Cause” or “Constructive Termination,” each as defined in his employment agreement, provides severance payments in the amount of one and one-half times his salary, one and one-half times his annual non-equity incentive award and subsidized COBRA reimbursements for 18 months. For Mr. Sehgal and Ms. Tarrant, termination without “Cause” or “Constructive Termination,” each as defined in our Executive Severance Plan, provides severance payments in the amount of one times their respective salaries, one times their respective annual non-equity incentive awards and subsidized COBRA reimbursements for 12 months. |
Potential Payments Upon a Termination or Change in Control
| (2) Mr. Atal receives severance in the amount of two times his salary, two times the annual non-equity incentive award and subsidized COBRA reimbursements for 18 months for termination without “Cause” or “Constructive Termination” during a change in control, as defined in his employment agreement. Mr. Sehgal and Ms. Tarrant receive severance in the amount of one and one-half times their respective salaries, one and one-half times their annual non-equity incentive awards and subsidized COBRA reimbursements for 18 months for termination without “Cause” or “Constructive Termination” during a change in control, as defined in our Executive Severance Plan. |
Potential Payments Upon a Termination or Change in Control
| (3) Messrs. Atal, Sjolund and James receive severance payments, as set forth in their employment agreements, and all NEOs receive vesting of equity grants accelerated in the case of a change in control and an involuntary termination without “Cause” or “Constructive Termination” (as defined in the Executive Severance Plan or the respective Employment Agreement) within the periods that are six months before and 24 months after the change in control. |
Potential Payments Upon a Termination or Change in Control
| (4) Equity values represent the immediate vesting of all unvested equity grants as of December 31, 2024 upon involuntary termination without “Cause” or “Constructive Termination” (as defined in the Executive Severance Plan or the respective Employment Agreement) in connection with a change in control, death and disability and are based on $20.89, the closing price of the Company’s common stock on December 31, 2024. |
Potential Payments Upon a Termination or Change in Control
| (5) Messrs. Sjolund and James compensation was converted to U.S. dollars from British pounds using a December 31, 2024 conversion rate of £1.00 = $1.2511. |
CEO Pay Ratio
CEO Pay Ratio For 2024, our last completed fiscal year:
CEO Pay Ratio
| • | the annual total compensation of our median employee was $54,966; |
CEO Pay Ratio
| • | the annualized total compensation of our CEO was $7,517,830; and |
CEO Pay Ratio
| • | the ratio of the annual total compensation of our CEO to our median employee was 137 to 1. |
CEO Pay Ratio
In accordance with SEC rules, we selected a median employee for 2024 who was the same median employee that was selected for 2023. We believe there has been no change in our employee compensation arrangements or employee population that would result in a significant change to our pay ratio disclosure for 2024, therefore we did not re-identify a new median employee for 2024. Based on our payroll and employment records for 2023, we identified the median employee from an employee population of 3,220 individuals on September 30, 2023. Our employee population included all employees as of September 30, 2023. We included the following pay elements in the total compensation for each employee:
CEO Pay Ratio
| • | salary received; |
CEO Pay Ratio
| • | overtime pay received; and |
CEO Pay Ratio
| • | incentive compensation payments received. |
CEO Pay Ratio
We identified our median employee for 2023 by, (1) calculating the total compensation using the pay elements described above for each of our employees and (2) ranking the total compensation of all employees (other than our CEO) from lowest to highest. We calculated the annual total compensation for our 2024 median employee using the same methodology used to calculate our CEO’s annual total compensation for 2024 as reported in the Summary Compensation Table in this Proxy Statement.
Pay Versus Performance
Pay Versus Performance Set forth below is information about the relationship between “ compensation actually paid” to our NEOs and certain financial performance measures. For further information concerning our pay-for-performance philosophy and how we align executive compensation with our performance, refer to the CD&A beginning on page 21 of this Proxy Statement. Pay Versus Performance Table
Pay Versus Performance
| Year (1) | Summary Compensation Table Total for PEO | | Compensation Actually Paid to PEO | | Average Summary Compensation Table Total for non-PEO NEOs ($) (2) | Average Compensation Actually Paid to non-PEO NEOs ($) (3)(4) | Value of Initial Fixed $100 Investment based on (5) : | | GAAP Net Income ($M) | Adjusted EBITDA ($M) (7)(8) | | | PEO Mr. Atal ($) (2) | PEO Mr. Stevenson ($) (2) | PEO Mr. Atal ($) (3) | PEO Mr. Stevenson ($) (3)(4) | | | TSR ($) | Peer Group TSR ($) (6) | | | | 2024 | 7,517,830 | — | 6,024,583 | — | 2,184,264 | 1,725,178 | 58 | 142 | 71 | 1,138 | | 2023 | 3,062,549 | 6,628,660 | 2,578,587 | 1,888,877 | 1,602,094 | 764,609 | 72 | 113 | (83) | 1,007 | | 2022 | — | 4,984,627 | — | 462,885 | 2,050,507 | 648,867 | 93 | 100 | 117 | 1,107 | | 2021 | — | 5,636,586 | — | 8,853,857 | 2,282,627 | 3,251,463 | 138 | 132 | 183 | 1,378 | | 2020 | — | 5,536,378 | — | 6,570,289 | 2,085,675 | 2,390,802 | 109 | 104 | 149 | 1,337 |
Pay Versus Performance
| (1) The following table lists the principal executive officer (“PEO”) and non-PEO NEOs for each of the fiscal years 2024, 2023, 2022, 2021 and 2020 . |
Pay Versus Performance
| Year | PEO | Non-PEO NEOs | | 2024 | Vikram A. Atal | Rakesh Sehgal, Martin Sjolund, LaTisha O. Tarrant and R. Owen James | | 2023 | Vikram A. Atal, Kevin P. Stevenson | Rakesh Sehgal, Martin Sjolund, LaTisha O. Tarrant, R. Owen James, Peter M. Graham and Laura B. White | | 2021-2022 | Kevin P. Stevenson | Peter M. Graham, Steven C. Roberts, Christopher B. Graves and Laura B. White | | 2020 | Kevin P. Stevenson | Peter M. Graham, Steven C. Roberts, Christopher B. Graves and Martin Sjolund |
Pay Versus Performance
| (2) Amounts reported in this column represent (i) the total compensation reported in the Summary Compensation Table for the applicable year for Messrs . Atal and Stevenson and (ii) the average of the total compensation reported in the Summary Compensation Table for non-PEO NEOs for each applicable year. |
Pay Versus Performance
| (3) To calculate compensation actually paid in accordance with SEC rules, adjustments were made to the amounts reported in the Summary Compensation Table for the applicable year. A reconciliation of the adjustments made in 2024 for Mr. Atal and for the average of the non-PEO NEO is set forth following the footnotes to this table. |
Pay Versus Performance
| (4) Compensation actually paid differs from that reported for 2022 due to a minor correction in a formulaic equation performed in 2023. |
Pay Versus Performance
| (5) Pursuant to the rules of the SEC, the comparison assumes $100 was invested on December 31, 2019 in our common stock. Historical stock price performance is not necessarily indicative of future stock price performance. |
Pay Versus Performance
| (6) Index TSR reflects the Nasdaq Financial 100. |
Pay Versus Performance
| (7) As noted in the CD&A, the Compensation Committee considered various key financial metrics when it determined Annual Bonus Plan payouts. The Compensation Committee selected Adjusted EBITDA as the Company Selected Measure. It is an important supplemental measure of operations and financial performance, as it excludes certain items whose fluctuations from period to period do not necessarily correspond to changes in the operations of our business. |
Pay Versus Performance
| (8) Adjusted EBITDA is a non-GAAP financial measure that is calculated by starting with our GAAP financial measure, Net income/(loss) attributable to PRA Group, Inc. and is adjusted for: |
Pay Versus Performance
| • | income tax expense (or less income tax benefit); |
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| • | foreign exchange loss (or less foreign exchange gain); |
Pay Versus Performance
| • | interest expense, net (or less interest income, net); |
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| • | other expense (or less other income); |
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| • | depreciation and amortization; |
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| • | impairment of real estate; |
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| • | net income/(loss) attributable to noncontrolling interests; and |
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| • | recoveries collected and applied to finance receivables, net less changes in expected recoveries. |
Pay Versus Performance
| | 2024 | | | | PEO | Average for non-PEO NEOs | | Summary Compensation Table Total (1) | 7,517,830 | 2,184,264 | | Adjustments (2) | | | | Deduction for amounts reported under the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table | (5,129,030) | (1,128,473) | | Year-end fair value of equity awards granted in the applicable year | 3,814,167 | 847,355 | | Year-over-year change in fair value of equity awards granted in prior years that are unvested at year end | (137,280) | (158,784) | | Year-over-year change in fair value of equity awards granted in prior years that vested in the year | (41,104) | (19,183) | | COMPENSATION ACTUALLY PAID | 6,024,583 | 1,725,178 |
Pay Versus Performance
| (1) For our PEO, Mr. Atal, this amount represents Total Compensation as reported in the Summary Compensation Table for the indicated fiscal year. With respect to the non-PEO NEOs, the amounts shown represent averages. |
Pay Versus Performance
| (2) We do not provide any defined benefit or actuarial pension plans to any employee, including our NEOs. Thus, no pension valuation adjustments were necessary. In addition, for purposes of the equity award adjustments shown above, no equity awards were cancelled due to failure to meet vesting conditions, no equity awards were granted and vested in the same year, and there are no dividends or interest accrued to report. |