DEF 14A of Nelnet Inc, Apr 4, 2024

DEF 14A of Nelnet Inc

Filed Apr 4, 2024 · FY20230001258602-24-000028

Open on EDGAR

  1. PROPOSAL 1 - ELECTION OF DIRECTORS

    PROPOSAL 1 - ELECTION OF DIRECTORS During 2023, the Company’s Board of Directors consisted of nine directors who were divided into three classes, designated as Class I, Class II, and Class III. In accordance with the Company’s Articles of Incorporation, the number of directors constituting the entire Board is fixed exclusively by the Board from time to time. The classes of directors serve for staggered three-year terms, with their current terms ending at the annual meeting of shareholders in the following years: Class I directors - 2024; Class II directors - 2025; and Class III directors - 2026. Shareholders are asked to elect three Class I directors to serve on the Board of Directors for a three-year term ending at the 2027 annual meeting of shareholders. The nominees for these Class I directorships are Preeta D. Bansal, Michael S. Dunlap, and Jona M. Van Deun. Each nominee is currently serving on the Board as a Class I director. Ms. Bansal and Mr. Dunlap were most recently elected to the Board by the shareholders at the 2021 annual meeting of shareholders; Ms. Van Deun was appointed to the Board as a Class I director on March 17, 2022 based on the recommendation of the Board's Nominating and Corporate Governance Committee. In making these nominations, the Board and the Nominating and Corporate Governance Committee consider each nominee's specific experience, qualifications, and skills as described below. Upon the recommendation of the Board's Nominating and Corporate Governance Committee, the Board has nominated each of the Class I director nominees named below to serve on the Board of Directors as Class I directors. The Board of Directors recommends that shareholders vote FOR the election of each Class I director nominee (named below) to the Board of Directors. In the event that before the election any Class I director nominee becomes unable to serve or for good cause unwilling to serve, if elected, the shares represented by proxy will be voted for any substitute nominees designated by the Board, unless the proxy does not indicate that the shares are to be voted for all Class I director nominees, or, if the Board does not designate any substitute nominees, the shares represented by proxy may be voted for a reduced number of nominees. The Board of Directors knows of no reason why any of the persons nominated for election as Class I directors might be unable or unwilling to serve if elected, and each nominee has consented to and expressed an intention to serve if elected. There are no arrangements or understandings between any of the nominees and any other person pursuant to which any of the nominees was selected as a nominee. The following sets forth certain information about (i) each of the three nominees for election as Class I directors to serve for a three-year term expiring at the 2027 annual meeting of shareholders, and (ii) each of the current Class II and Class III directors whose term of office continues beyond the 2024 Annual Meeting. The information includes, with respect to each such person: (a) their age, (b) the year during which they were first elected a director of the Company, (c) their principal occupation(s) and any other directorships with publicly-held companies (if applicable) during the past five years, and (d) the qualifications of such person that led to the conclusion that such person should serve as a director of the Company.

  2. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Class I Director Nominees to Hold Office for a Term Expiring at the 2027 Annual Meeting of Shareholders | | | | | Preeta D. Bansal, 58 Director since November 2018 | Senior lawyer, former public official, and global business leader | | | | | | Self-employed advisor, investor, lecturer, and consultant, 2016 - present | | | | | Massachusetts Institute of Technology, Lecturer, Senior Advisor, and Visiting Scholar, 2014 - 2019 | | | | | HSBC Holdings plc, a multinational investment bank and financial services company, Global General Counsel for Litigation and Regulatory Affairs, 2012 - 2013 | | | | | Office of Management and Budget, Executive Office of the President of the United States, General Counsel and Senior Policy Advisor, 2009 - 2011 | | | | | Skadden, Arps, Slate, Meagher & Flom LLP, an international law firm, Partner, 2003 - 2009 | | | | | United States Commission on International Religious Freedom, Commissioner, 2003 - 2009 (Chair, 2004 - 2005) | | | | | University of Nebraska College of Law, Visiting Professor, 2001 - 2003 | | | | | State of New York, Solicitor General, 1999 - 2001 | | | | Ms. Bansal's qualifications include over 30 years of experience in corporate and public law, banking, financial services, government, regulation, public policy, U.S. diplomacy, and academia as a distinguished lawyer, public official, and global business leader. Her experience has included serving as general counsel and senior policy advisor in the federal Office of Management and Budget, which oversees and coordinates all of the budgetary, regulatory, and management activities and initiatives of the departments and agencies of the federal government on behalf of the President of the United States; as global general counsel for litigation and regulatory affairs for HSBC Holdings in London; as partner and practice chair of the international law firm Skadden, Arps, Slate, Meagher & Flom LLP in New York City; and as Solicitor General of the State of New York. Ms. Bansal is a Henry Crown Fellow at the Aspen Institute, a life member of the Council on Foreign Relations, and active with numerous local, national, and global organizations. She received the National Organization of Women's “Woman of Power and Influence Award” in 2006 and was named one of the “50 Most Influential Minority Lawyers in America” by the National Law Journal in 2008. She is a magna cum laude graduate of Harvard Law School and Harvard-Radcliffe College, and a former law clerk to U.S. Supreme Court Justice John Paul Stevens. Ms. Bansal provides to the Board of Directors and the Company valuable insight and leadership on various business, compliance, regulatory, and policy issues. | | | | Michael S. Dunlap, 60 Director since January 1996 | Executive Chairman, Nelnet, Inc. | | | | | | Nelnet, Inc. | | | | | | Executive Chairman, January 2014 - present | | | | | Chairman, January 1996 - December 2013 | | | | | Chief Executive Officer, May 2007 - December 2013 | | | | | Co-Chief Executive Officer, January 1996 - May 2007 | | | | Farmers & Merchants Investment Inc. (“F&M”), the parent of Union Bank and Trust Company (“Union Bank”) (F&M and Union Bank are affiliates of the Company) | | | | | | Co-Chairman, January 2024 - present | | | | | Chairman, January 2013 - January 2024 | | | | | Co-President and Director, January 2007 - January 2013 | | | Mr. Dunlap's qualifications include more than 30 years of experience in the areas of banking and financial services, leadership, strategic operations, and management, including as one of our co-founders and our Chairman since the Company's inception, as well as his experience as a member of the boards of directors of numerous other organizations. Mr. Dunlap's knowledge of every part of our business and his intense focus on customer service, innovation, and excellence are keys to our Board's success. | | |

  3. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Jona M. Van Deun, 54 Director since March 2022 | Managing Partner, Prairie Coast Strategies, LLC | | | | | | Prairie Coast Strategies, LLC, a consulting firm advising clients on grassroots, government and public affairs, and large logistic/production projects. | | | | | | Partner, November 2022 - present | | | | Nebraska Tech Collaborative, a business-led Aksarben Workforce Initiative committed to convening leaders from government, education, and not-for-profit organizations across the state to develop, attract, and retain tech-talent and entrepreneurs to Nebraska. | | | | | | President, September 2018 - September 2022 | | | | Small Business Coalitions and Engagement for U.S. Chamber of Commerce. The U.S. Chamber of Commerce, whose members range from small businesses and chambers of commerce across the country to leading industry associations and global corporations, advocates for policies that help businesses create jobs and grow the economy. | | | | | | Vice President, October 2017 - September 2018 | | | | Koch Companies Public Sector, LLC, a shared-services company that provides legal, government, and public affairs services to affiliates of Koch Industries, Inc. around the world. Koch Industries, Inc. is a privately-held multinational conglomerate with interests in industries such as refining, chemicals, and biofuels; forest and consumer products; fertilizers; polymers and fibers; process and pollution control equipment and technologies; electronics; information systems; commodity trading; minerals; energy; glass; ranching; and investments. | | | | | | Director of Coalitions, December 2012 - September 2017 | | | Ms. Van Deun's qualifications include having vast information technology and talent acquisition expertise from her extensive background in politics and public affairs, and she has provided strategic expertise to several trade associations and Fortune 500 companies, including 3M Company, DCI Group, the Pillsbury Company, and the Property Casualty Insurers Association. | | |

  4. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Class II Directors Continuing in Office for a Term Expiring at the 2025 Annual Meeting of Shareholders | | | | | Matthew W. Dunlap, 34 Director since March 2022 | Chief Business Development Officer, Nelnet, Inc., and President, Nelnet Financial Services | | | | | | Nelnet, Inc. | | | | | | President, Nelnet Financial Services, April 2023 - present | | | | | Chief Business Development Officer, March 2022 - present | | | | | Managing Director, Nelnet Business Services, February 2020 - March 2022 | | | | | Legal counsel, February 2017 - February 2020 | | | | GVC Capital, LLC, an investment banking firm focused primarily on providing comprehensive investment banking services to underexposed small public and private companies. | | | | | | Associate, November 2015 - January 2017 | | | Mr. Dunlap brings to the Board of Directors his legal expertise and an in-depth understanding of the Company's business models and practices from his experiences as an in-house attorney serving our asset generation and loan servicing businesses and as a Managing Director for the Company. In addition, Mr. Dunlap brings expertise in banking and finance through his time serving on the board of directors at Bankfirst and First Northeast Bank of Nebraska. | | |

  5. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Adam K. Peterson, 42 Director since March 2022 | Co-Chairman, Co-Chief Executive Officer, and Co-President, Boston Omaha | | | | | | Boston Omaha is a public holding company with businesses engaged in several sectors including advertising, insurance, telecommunications, and real estate. | | | | | | Co-Chairman, February 2015 - present | | | | | Co-CEO and Co-President, December 2017 - present | | | | | Executive Vice President, February 2015 - December 2017 | | | | The Magnolia Group LLC, an SEC registered investment advisor and general partner of Magnolia Capital Fund, LP, which is one of Nelnet's largest external non-management shareholders. | | | | | | Managing Member, June 2014 - present | | | | Nicholas Financial Inc., a publicly traded specialized consumer finance company engaged primarily in acquiring and servicing automobile finance installment contracts for purchases of used and new automobiles, originating direct consumer loans, and selling consumer-finance related products. | | | | | | Director, June 2017 - present | | | | | Crescent Bank & Trust, a bank that specializes in auto loans to consumers in multiple states, as well as offers local personal and business banking services to the Greater New Orleans Area. | | | | | Director, March 2022 - present | | | | Yellowstone Acquisition Group, a publicly traded special purpose acquisition company that completed a business combination with Sky Harbour LLC in January 2022 and was renamed Sky Harbour Group Corporation. | | | | | | Director, August 2020 - January 2022 | | | | Brampton Brick Ltd., a publicly traded Canadian company specializing in masonry materials and products. | | | | | | Director, May 2016 - March 2021 | | | | Magnolia Capital Partners, LP and related entities | | | | | | Chief Investment Officer, November 2005 - August 2014 | | | Mr. Peterson's qualifications include almost 20 years of extensive experience in business operations, investments, and financial analysis in a variety of industries, including advertising, insurance, telecommunications, real estate, and financial services. | | | | Kimberly K. Rath, 63 Director since October 2007 | Co-Chair, Talent Plus, Inc. | | | | | | Talent Plus, Inc., a global human resources consulting firm. | | | | | | Co-Chair, August 2013 - present | | | | | President, Talent Plus, Inc., 2016 - 2019 | | | | | Co-Founder, Talent Plus, Inc., 1989 - present | | | Ms. Rath's qualifications include 35 years of experience in the field of human resources, with expertise in executive development, employee engagement, and human capital management. Ms. Rath leads an international executive management consulting and training organization, working with major global companies. Ms. Rath serves as an executive strategic advisor to many leaders across the globe in both private and public sectors. | | |

  6. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Class III Directors Continuing in Office for a Term Expiring at the 2026 Annual Meeting of Shareholders | | | | | Kathleen A. Farrell, 60 Director since October 2007 | Dean and Professor of Finance, College of Business, University of Nebraska-Lincoln | | | | | | College of Business, University of Nebraska - Lincoln | | | | | | Dean, December 2017 - present | | | | | Professor of Finance, August 2009 - present | | | | | Interim Dean, January 2017 - December 2017 | | | | | Chair, Finance Department, August 2014 - December 2016 | | | | | Senior Associate Dean of Academic Programs, August 2011 - July 2014 | | | | | Associate Dean of Academic Programs, August 2010 - August 2011 | | | | | Associate Professor of Finance, 2001 - July 2009 | | | | | Assistant Professor of Finance, August 1993 - 2001 | | | Dr. Farrell's qualifications include her expertise in corporate finance, executive turnover, and executive compensation, and her prior experience as an auditor at a national public accounting firm. Dr. Farrell has achieved designation as a Certified Public Accountant (inactive), has 30 years of experience teaching university courses in the areas of banking and finance, and has conducted extensive research on these topics. Dr. Farrell has also published articles on these topics in numerous scholarly journals. | | | | David S. Graff, 41 Director since May 2014 | Chief Executive Officer, Agile Sports Technologies, Inc. (doing business as Hudl) | | | | | | Hudl provides online video analysis and coaching tools software for professional, college, high school, club, and youth teams and athletes, and Hudl software is used by more than 230,000 teams, serving more than 40 different sports and 150 countries, including the National Hockey League, National Football League, National Basketball Association, and English Premier League. Hudl has more than 3,500 employees in 18 countries. | | | | | | Chief Executive Officer, May 2006 - present | | | | Sportsmap Tech Acquisition Corporation, a publicly traded special purpose acquisition company formed for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization, or other similar business combination with one or more businesses or entities. | | | | | | Director, September 2021 - December 2023 | | | Mr. Graff's qualifications include his experience and expertise in computer science, marketing, and sales. In addition, as co-founder of Hudl, Mr. Graff provides the Board of Directors and the Company significant expertise in business development and innovation. In 2010, Mr. Graff was featured on Inc. Magazine's 30 Under 30 list along with the other Hudl co-founders, and in 2016 was named one of Fast Company's Most Creative People. In addition, Mr. Graff served as a member of the board of directors for certain of the Company's asset-backed securities special purpose corporations. | | |

  7. PROPOSAL 1 - ELECTION OF DIRECTORS

    | Thomas E. Henning, 71 Director since August 2003 | | First Interstate Bancorp ("FIBK"), a publicly traded financial and bank holding company focused on community banking. | | | | | | Director, February 2022 - present | | | | Great Western Bancorp, Inc. ("GWB") and Great Western Bank; GWB was a publicly traded full service regional bank holding company. On February 1, 2022, GWB was acquired by FIBK. | | | | | | Director, August 2015 - January 2022 | | | | Federal Home Loan Bank Topeka, a part of the 12-member Federal Home Loan Bank system. The bank serves the states of Oklahoma, Kansas, Nebraska, and Colorado and provides liquidity to member institutions to assist in financing real estate. | | | | | | Director, January 2023 - present | | | | | Director, March 2007 - October 2015 | | | | Assurity Group, Inc. and its subsidiary, Assurity Life Insurance Company, which offers a variety of disability income and critical illness protection, life insurance, and annuity products. | | | | | | Non-Executive Chairman, January 2022 - December 2022 | | | | | President and Chief Executive Officer, 1990 - December 2021 | | | Mr. Henning's qualifications include over 30 years of experience as President and Chief Executive Officer of a large insurance company, his prior experience as President of a regional bank, his financial expertise, including being a Chartered Financial Analyst and a member of the board of directors of other financial service organizations, his experience in risk assessment and management, and his vast knowledge and experience in leadership and management. | | |

  8. Director Compensation Overview

    Director Compensation Overview The Company’s compensation program for directors (except for Michael Dunlap, who does not receive any compensation for Board or committee service) is designed to reasonably compensate directors for their service on the Board of Directors and its committees, in amounts commensurate with their roles and involvement, and taking into consideration the significant amount of time they devote in fulfilling their duties in view of the Company’s size, complexity, and risks, as well as the experience and skill levels required of members of the Board. The Company intends to compensate its directors in a manner that attracts and retains high quality Board members, and ensures that their interests are aligned with the shareholders. The People Development and Compensation Committee reviews the compensation program for directors on an annual basis and makes recommendations regarding the program to the Board. In addition to the various components of the Company’s compensation program for directors discussed under the "Director Compensation Elements," “Director Compensation Table for Fiscal Year 2023,” and “Share Ownership Guidelines for Board Members” captions below, the Company has a policy prohibiting members of the Board of Directors from short sales of the Company’s stock, buying or selling call or put options or other derivatives related to the Company’s stock, or engaging in hedging or monetization transactions with respect to any of their direct or indirect interest in the Company’s stock, including through the use of financial instruments such as prepaid variable forwards, equity swaps, collars, and exchange funds. The Company's policy also requires members of the Board who wish to buy or sell the Company’s stock to do so only through Rule 10b5-1 stock trading plans, and limits the use of margin accounts or other pledge arrangements by Board members with respect to the Company's stock. See "Executive Compensation" - "Compensation Discussion and Analysis" - "Prohibition on Hedging and Short Sales, and Limits on Share Pledging."

  9. Director Compensation Elements

    Director Compensation Elements Directors are primarily compensated through an annual retainer in the base amount of $150,000 for each director. An additional annual retainer of $10,000 is paid to directors who serve as members on each of the Audit Committee, People Development and Compensation Committee, Compliance Committee, Nominating and Corporate Governance Committee, Risk and Finance Committee, or Executive Committee, as applicable. The Chair of the Audit Committee is also paid an additional $12,500 annual retainer fee. Directors are also compensated for Board meeting and committee meeting attendance, earning $1,000 for each Board and committee meeting attended. As indicated above, Michael Dunlap does not receive any consideration for participation in Board or committee meetings. Prior to 2023, the Company had a Directors Stock Compensation Plan for Non-Employee Directors that was approved by the Board of Directors and shareholders, pursuant to which Non-Employee Directors could elect to receive their annual retainer fees in the form of cash or in shares of the Company's Class A common stock. On March 16, 2023 and May 18, 2023, the Board of Directors and shareholders, respectively, approved an amended and restated Directors Stock Compensation Plan to, among other things, allow for Board members who are also employees of the Company to be eligible to participate in the plan and elect to receive their annual retainer fees in shares of stock instead of cash. Under the plan, if a Director elects to receive Class A common stock, the number of shares that will be granted will be equal to the amount of the annual retainer fee otherwise payable in cash divided by 85% of the fair market value of a share of Class A common stock on the date the fee is payable. Directors who choose to receive Class A common stock may also elect to defer receipt of the Class A common stock until termination of their service on the Board of Directors. Any dividends paid in respect of deferred shares during the deferral period will also be deferred in the form of additional shares and paid out at termination of service on the Board of Directors. Based on the amended and restated plan, Matthew Dunlap, an employee of the Company, will be eligible to make share elections and effectively participate in the plan with respect to annual retainers for Board and Board committee service for years ending on and after December 31, 2024. This plan may be amended or terminated by the Board of Directors at any time, but no amendment or termination will adversely affect a Director's rights with respect to previously deferred shares without the consent of the Director.

  10. Director Compensation Table for Fiscal Year 2023

    Director Compensation Table for Fiscal Year 2023 The following table sets forth summary information regarding compensation of Directors for the fiscal year ended December 31, 2023. The table excludes Matthew Dunlap, Chief Business Development Officer and President of Nelnet Financial Services, whose compensation, including director compensation, is presented under "Executive Compensation - Summary Compensation Table for Fiscal Years 2023, 2022, and 2021."

  11. Director Compensation Table for Fiscal Year 2023

    | | 2023 Compensation | | | | | Director name | Fees paid in cash ($) (a) | Stock awards ($) (b) | Matching gift programs ($) (c) | Total ($) | | Preeta D. Bansal | 21,000 | 211,769 | 25,000 | 257,769 | | Michael S. Dunlap (d) | — | — | — | — | | Kathleen A. Farrell | 14,000 | 211,769 | — | 225,769 | | David S. Graff | 17,000 | 199,999 | — | 216,999 | | Thomas E. Henning | 17,000 | 226,532 | — | 243,532 | | Adam K. Peterson | 20,000 | 211,769 | 24,999 | 256,768 | | Kimberly K. Rath | 14,000 | 199,999 | — | 213,999 | | Jona M. Van Deun | 18,000 | 211,769 | 15,000 | 244,769 |

  12. Director Compensation Table for Fiscal Year 2023

    (a)Amounts represent cash paid to Board members for attendance at Board and committee meetings. (b)Each of the Non-Employee Directors elected to receive their annual retainer fees for 2023 in the form of awards of the Company's Class A common stock or deferred shares under the Directors Stock Compensation Plan, which awards are within the scope of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718). As such, the amounts under “stock awards” in the table above represent the grant date fair value of the stock or deferred shares computed in accordance with FASB ASC Topic 718 based on the closing market price of the Class A common stock of $99.75 per share on June 16, 2023, the trading day immediately preceding the date of issuance. Under this plan, the Company uses 85% of such closing market price of the Class A common stock on the date immediately preceding the date the annual retainer fees are payable to calculate the number of shares to be issued under this plan. Additional information about the Company’s accounting for stock-based compensation under FASB ASC Topic 718 can be found in Note 2 - “Summary of Significant Accounting Policies and Practices - Compensation Expense for Stock Based Awards” and Note 21 - “Stock Based Compensation Plans - Directors Compensation Plan” of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. (c)Amounts represent matching contributions by the Company to charitable organizations during 2023 under the Company's matching gift program. (d)Michael Dunlap, who is an employee and Executive Chairman of the Company, does not receive any compensation for Board or committee service. Mr. Dunlap's total compensation as an employee of the Company for the year ended December 31, 2023 was approximately $655,000, which includes a salary of approximately $633,000, and other compensation totaling approximately $22,000.

  13. Compensation Discussion and Analysis

    | Element | Purpose | Characteristics | | Base salary | Competitive cash compensation to retain and attract executive talent. | Fixed cash compensation based upon the scope and complexity of the role, individual experience, performance, and market competitiveness. Reviewed annually and adjusted as warranted. | | Annual performance-based incentive bonuses | Drive the achievement of key short-term business results and recognize individual contributions to these results. | Primary mode to differentiate compensation based on performance. Annual incentives based on a combination of financial metrics and individual goals. Potential cash-equity mix through performance-based incentive program stock election framework. | | Restricted stock awards | Promote long-term focus on shareholder value, serve as an important retention tool, and encourage equity stake in the Company. | Equity-based compensation subject to vesting periods, or other restrictions on sale, generally for three to ten years. | | Health, retirement, and other benefits | Designed to provide competitive health insurance options and income replacement upon retirement, death, or disability. | Benefits for Named Executive Officers are the same as those available to all associates. | | Intrinsic rewards | Non-cash rewards to increase engagement, provide opportunities for individual growth, and subsidize learning initiatives. | Professional training and development, coaching, mentoring, tuition reimbursement, and community activity support. |

  14. Compensation Discussion and Analysis

    •Operating performance and efficiency targets and ratios, as well as productivity targets and ratios; •Levels of, or increases or decreases in, operating margins, operating expenses, and/or nonoperating expenses; •Business segment, division, or unit profitability and other performance measures (including growth in customer base, revenues, earnings before interest, taxes, depreciation and amortization, and segment profitability, as well as management of operating expense levels); •Acquisitions, dispositions, projects, or other specific events or transactions (including specific events or transactions intended to enhance the long-term strategic positioning of the Company); •Performance of investments; •Regulatory compliance measures; or •Any other criteria as determined by the Committee in its sole discretion. The Plan provides that in no event shall the amount paid under the Plan to a participant with respect to any calendar year exceed 150% of that participant’s base salary for that year. While the Company strives for overall consistency in executive compensation, the Named Executive Officers' potential incentive bonus amounts can vary by business segment due to differences in roles, business models, and business performance. Incentives are generally positioned to be within a median range of the marketplace based on available broad based data. The Company's 2023 annual performance-based incentive bonuses were paid, at the Named Executive Officers' option, as either 100% cash, 100% stock, or 25%, 50%, or 75% stock with the remaining percentage paid in cash. All shares issued as part of the incentive bonus awards were issued pursuant to the Company's Restricted Stock Plan discussed below, and were fully vested. Performance of Named Executive Officers for 2023 In 2023, the Chief Executive Officer (Mr. Noordhoek), Chief Operating Officer (Mr. Heimes), Chief Financial Officer (Mr. Kruger), President (Mr. Tewes), and Chief Business Development Officer and President of Nelnet Financial Services (Matthew Dunlap) were selected by the Committee to participate in and be eligible for incentive compensation awards under the Plan for the year ended December 31, 2023. The Committee established performance goals for these individuals in early 2023 utilizing certain of the performance measures under the Plan referred to above and described in more detail below, and in early 2024 the Committee reviewed performance for these individuals for 2023 under the terms of the Plan in establishing incentive awards for each. No specific quantitative/objective performance targets or formulas were set or used in establishing the performance goals. For 2023, the Committee considered the Named Executive Officers’ performance in respect of the Plan measures described above, including, but not necessarily limited to: •strong earning results for 2023 in the Company's fee-based businesses (the Loan Servicing and Systems and Education Technology Services and Payments operating segments); •the award of a new multi-year servicing contract with the Department of Education; •sustaining substantial estimated future cash flow from the Company's existing loan portfolio; •asset diversification and growth, including non-FFELP loans and securitized loan residual interests, through strategic partners and originations through Nelnet Bank; •Nelnet Bank's successful completion and exit of its de novo period in November 2023; •the formation of the Nelnet Financial Services division; •customer satisfaction levels; •employee engagement; and •individual achievement. Other factors considered by the Committee included: •the negative impact to earnings from the Company's 2022 acquisition of GRNE Solar, the Company's solar construction business; •overall earning results being less than expected due to the impact of unwinding derivatives and selling certain investments in March 2023 to manage liquidity; and •growth in the Company's per share book value in 2023 (with dividends included) of only 3.4%. Based on the Named Executive Officers’ performance in 2023 and the level of attainment of the 2023 performance goals for the Named Executive Officers, the Committee awarded each of the Named Executive Officers a 2023 annual incentive under the Plan of $450,000, as reflected in the Summary Compensation Table below. Restricted Stock Plan The Company maintains a Restricted Stock Plan to reward performance by associates, including the Named Executive Officers. This plan permits the Committee to reward a recipient with an award of shares of the Company's Class A common stock, which, in the Committee's sole discretion, may have vesting requirements or other restrictions. These awards are designed to recognize and reward associates, and to connect the associates' financial interests directly to the Company's performance, thereby encouraging associates to focus their efforts as owners of the Company. As discussed above, shares issued in payment of annual performance-based incentive bonuses and other equity compensation awards are issued under the Restricted Stock Plan. The Company does not grant stock options, since management and the Committee believe that awards of shares of restricted stock are a better method of encouraging associates, including the Named Executive Officers, to focus on the long-term value of the Company. Employee Share Purchase Plan The Company also has an Employee Share Purchase Plan (ESPP) that assists all associates, including the Named Executive Officers, in becoming owners and increasing their ownership of the Company. Under the ESPP, associates may purchase up to $25,000 (per year) of shares of the Company's Class A common stock through payroll deductions, at a discount of 15% to the lower of the average market price of the Company's stock on the first and last trading days of each calendar quarter. Termination or Change-in-Control Compensation Other than with respect to provisions in restricted stock award agreements for grants of restricted stock whereby any unvested shares of restricted stock will become fully vested upon a termination of employment as a result of death, disability, or retirement after reaching the age of 65, which provisions are generally included in all agreements for restricted stock awards granted to associates, the Company does not have any contracts, agreements, plans, or arrangements with the Named Executive Officers that provide for payment in connection with any termination of employment or change-in-control of the Company. Stock Trading Requirements The Company has adopted a policy requiring officers who wish to buy or sell the Company's stock to do so only through Rule 10b5-1 stock trading plans. This requirement is designed to enable officers to diversify a portion of their holdings in an orderly manner as part of their retirement and tax planning or other financial planning activities. The use of Rule 10b5-1 stock trading plans serves to reduce the risk that investors will view routine portfolio diversification stock sales by executive officers as a signal of negative expectations with respect to the future value of the Company's stock. In addition, the use of Rule 10b5-1 stock trading plans reduces the potential for concerns about trading on the basis of material non-public information that could damage the reputation of the Company. Other Compensation

  15. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    Summary Compensation Table for Fiscal Years 2023, 2022, and 2021 The following table sets forth summary information with respect to the compensation paid and bonuses granted for services rendered by the Company's Chief Executive Officer and Chief Financial Officer, as well as each of the Company's other three most highly compensated executive officers during the year ended December 31, 2023 (collectively, the “Named Executive Officers”). The information presented in the table relates to the fiscal years ended December 31, 2023, 2022, and 2021, except that in accordance with SEC guidance only information relating to the fiscal year ended December 31, 2023 is presented for Matthew Dunlap, who first became a Named Executive Officer in 2023. Salaries and bonuses are paid at the discretion of the Board of Directors.

  16. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    | | | Annual compensation | | | | | | Name and principal position | Year | Salary ($) | Bonus ($) (a) | Stock awards ($) (b) | All other compensation ($) (c) | Total ($) | | Jeffrey R. Noordhoek | 2023 | 854,501 | 450,000 | 500,013 | 37,642 | 1,842,156 | | Chief Executive Officer | 2022 | 813,810 | 874,851 | 500,016 | 36,205 | 2,224,882 | | | 2021 | 782,509 | 899,897 | 1,000,059 | 49,850 | 2,732,315 | | Terry J. Heimes | 2023 | 854,501 | 450,000 | 500,013 | 74,873 | 1,879,387 | | Chief Operating Officer | 2022 | 813,810 | 874,851 | 500,016 | 55,885 | 2,244,562 | | | 2021 | 782,509 | 841,203 | 1,000,059 | 57,412 | 2,681,183 | | James D. Kruger | 2023 | 854,501 | 450,000 | 500,013 | 41,962 | 1,846,476 | | Chief Financial Officer | 2022 | 813,810 | 905,371 | 500,016 | 36,885 | 2,256,082 | | | 2021 | 782,509 | 899,897 | 1,000,059 | 31,210 | 2,713,675 | | Timothy A. Tewes | 2023 | 854,501 | 450,000 | 500,013 | 64,712 | 1,869,226 | | President | 2022 | 813,810 | 813,810 | 500,016 | 64,155 | 2,191,791 | | | 2021 | 782,509 | 782,509 | 1,000,059 | 71,964 | 2,637,041 | | Matthew W. Dunlap | 2023 | 300,000 | 450,042 | — | 200,646 | 950,688 | | Chief Business Development Officer and President of Nelnet Financial Services | | | | | | |

  17. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    (a)Amounts represent bonuses paid in 2024, 2023, and 2022 for services rendered during the 2023, 2022, and 2021 calendar years, respectively. The Company's annual performance-based incentive bonuses were paid, at the executives' option, as either 100% cash, 100% stock, or 25%, 50%, or 75% stock with the remaining percentage paid in cash. Those electing stock for services rendered in 2022 and 2021 also received an additional number of shares representing 15% of the amount of their bonus they elected to receive in stock, to promote increased and continued share ownership. Stock issued for incentive bonus awards were fully vested, however, stock issued for both 2022 and 2021 may not be transferred for three years from the date of issuance. All shares issued as part of the incentive bonus award were issued pursuant to the Company's Restricted Stock Plan. The stock issuances for annual performance bonuses were not made as equity incentive plan awards contemplating future service or performance. (b)In addition to receiving annual performance-based incentive bonuses as described above, on March 10, 2023, 2022, and 2021, each of Messrs. Noordhoek, Heimes, Kruger, and Tewes were awarded five-year restricted stock grants (subject to vesting conditions) of 5,473 shares, 6,052 shares, and 13,467 shares, respectively, of Class A common stock under the Restricted Stock Plan, with the number of restricted shares granted to each of these Named Executive Officers computed as $0.5 million, $0.5 million, and $1.0 million, respectively, divided by the average market closing price for Class A common stock over the five trading day period ended March 7, 2023, March 7, 2022, and March 4, 2021, respectively, which was $91.36, $82.62, and $74.26, respectively. Amounts represent the grant date fair values of the various restricted stock awards (subject to vesting conditions) computed in accordance with FASB ASC Topic 718. Additional information about the Company's accounting for stock-based compensation under FASB ASC Topic 718 can be found in Note 2 - "Summary of Significant Accounting Policies and Practices - Compensation Expense for Stock Based Awards" and Note 21 - "Stock Based Compensation Plans - Restricted Stock Plan" of the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023. (c)“All other compensation” for the fiscal year ended December 31, 2023 includes the following:

  18. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    | | All other compensation | | | | | | | | | Employer matching contributions under 401(k) Plan ($) | Premiums on life insurance ($) | Matching gift programs ($) (1) | Dividends on restricted stock ($) (2) | Personal use of company aircraft ($) (3) | Other ($) (4) | Total ($) | | Jeffrey R. Noordhoek | 13,200 | 352 | 5,000 | 19,090 | — | — | 37,642 | | Terry J. Heimes | 13,200 | 352 | 38,000 | 19,090 | 3,431 | 800 | 74,873 | | James D. Kruger | 13,200 | 352 | 6,700 | 19,090 | — | 2,620 | 41,962 | | Timothy A. Tewes | 13,200 | 352 | 32,070 | 19,090 | — | — | 64,712 | | Matthew W. Dunlap | 9,154 | 352 | 3,750 | 3,390 | — | 184,000 | 200,646 |

  19. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    (1)See “Compensation Discussion and Analysis - Matching Gift Programs” above for a description of these programs. (2)The Company's cash dividend payments on its Class A and Class B common stock include dividend payments on unvested shares of Class A common stock issued pursuant to the Company's Restricted Stock Plan. Dividends paid to the Named Executive Officers on unvested restricted stock are included in the table above. (3)See "Compensation Discussion and Analysis - Other Compensation" above for a description of this arrangement. (4)Executive officers may receive other perquisites and other personal benefits below the current SEC threshold of $10,000 for reporting. For Mr. Dunlap, the amount represents annual Board retainer fees and fees for attendance at Board and committee meetings during 2023. All fees received by Mr. Dunlap during 2023 were paid in cash. There were no stock option awards, non-equity incentive plan compensation, or pension or nonqualified deferred compensation earnings for any of the Company's Named Executive Officers during 2023, 2022, or 2021.

  20. Grants of Plan-Based Awards Table for Fiscal Year 2023

    Grants of Plan-Based Awards Table for Fiscal Year 2023 The following table sets forth summary information relating to each grant of an award made to the Company's Named Executive Officers in the fiscal year ended December 31, 2023 under the Company's Restricted Stock Plan.

  21. Grants of Plan-Based Awards Table for Fiscal Year 2023

    | Name | Grant date | Approval of grant by Compensation Committee | Number of shares of stock | Grant date fair value of stock awards ($) (c) | | Jeffrey R. Noordhoek | March 10, 2023(a) (b) | February 1, 2023 | 10,595 | 967,959 | | Terry J. Heimes | March 10, 2023(a) (b) | February 1, 2023 | 10,595 | 967,959 | | James D. Kruger | March 10, 2023(a) (b) | February 1, 2023 | 13,156 | 1,201,932 | | Timothy A. Tewes | March 10, 2023(a) | February 1, 2023 | 5,473 | 500,013 | | Matthew W. Dunlap | March 10, 2023(b) | February 1, 2023 | 1,574 | 143,801 |

  22. Grants of Plan-Based Awards Table for Fiscal Year 2023

    (a)Included in these amounts are 5,473 shares of restricted Class A common stock issued on March 10, 2023 to each of Mr. Noordhoek, Mr. Heimes, Mr. Kruger, and Mr. Tewes pursuant to the Company's Restricted Stock Plan, of which 1,095 shares vested on March 10, 2024, 1,095 shares are scheduled to vest on March 10, 2025 and 2027, and 1,094 shares are scheduled to vest on March 10, 2026 and 2028. (b)On March 10, 2023, the Company issued stock to pay fiscal year 2022 bonuses for those employees who elected to receive stock instead of cash for such bonuses, and Messrs. Noordhoek, Heimes, Kruger, and Dunlap were issued 5,122 shares, 5,122 shares, 7,683 shares, and 1,574 shares, respectively. The stock issuances were not made as equity incentive plan awards. (c)The Company determined the value of these awards based on the average of the closing market prices for the Company's Class A common stock on March 1, 2023 through March 7, 2023, which was $91.36.

  23. Outstanding Equity Awards at Fiscal Year-End Table (As of December 31, 2023)

    Outstanding Equity Awards at Fiscal Year-End Table (As of December 31, 2023) The following table sets forth summary information relating to the outstanding unvested equity awards for the Company's Named Executive Officers as of December 31, 2023.

  24. Outstanding Equity Awards at Fiscal Year-End Table (As of December 31, 2023)

    | | Stock awards | | | Name | Number of shares of stock that have not vested | Market value of shares of stock that have not vested ($) (c) | | Jeffrey R. Noordhoek | 18,394(a) | 1,622,719 | | Terry J. Heimes | 18,394(a) | 1,622,719 | | James D. Kruger | 18,394(a) | 1,622,719 | | Timothy A. Tewes | 18,394(a) | 1,622,719 | | Matthew W. Dunlap | 3,052(b) | 269,247 |

  25. Outstanding Equity Awards at Fiscal Year-End Table (As of December 31, 2023)

    (a)Amount represents (i) 5,473 shares of restricted Class A common stock issued to each of Mr. Noordhoek, Mr. Heimes, Mr. Kruger, and Mr. Tewes on March 10, 2023 pursuant to the Company's Restricted Stock Plan, of which 1,095 shares vested on March 10, 2024, 1,095 shares are scheduled to vest on March 10, 2025 and 2027, and 1,094 shares are scheduled to vest on March 10, 2026 and 2028, (ii) 4,841 shares of restricted Class A common stock issued to each of Mr. Noordhoek, Mr. Heimes, Mr. Kruger, and Mr. Tewes on March 10, 2022 pursuant to the Company's Restricted Stock Plan, of which 1,210 shares vested on March 10, 2024, 1,211 shares are scheduled to vest on March 10, 2025, and 1,210 shares are scheduled to vest on March 10, 2026 and 2027, and (iii) 8,080 shares of restricted Class A common stock issued to each of Mr. Noordhoek, Mr. Heimes, Mr. Kruger, and Mr. Tewes on March 10, 2021 pursuant to the Company's Restricted Stock Plan, of which 2,694 shares vested on March 10, 2024 and 2,693 shares are scheduled to vest on March 10, 2025 and 2026. (b)Amount represents (i) 2,025 shares of restricted Class A common stock issued to Mr. Dunlap on March 10, 2022 pursuant to the Company's Restricted Stock Plan, of which 225 shares vested on March 10, 2024 and 225 shares are scheduled to vest annually on March 10, 2025 through 2032, (ii) 191 shares of restricted Class A common stock issued to Mr. Dunlap on March 10, 2020 pursuant to the Company's Restricted Stock Plan, of which 96 shares vested on March 10, 2024 and 95 shares are scheduled to vest on March 10, 2025, (iii) 636 shares of restricted Class A common stock issued to Mr. Dunlap on March 11, 2019 pursuant to the Company's Restricted Stock Plan, of which 136 shares vested on March 10, 2024 and 100 shares are scheduled to vest annually on March 10, 2025 through 2029, and (iv) 200 shares of restricted Class A common stock issued to Mr. Dunlap on June 12, 2017 pursuant to the Company's Restricted Stock Plan, of which 50 shares are scheduled to vest annually on June 10, 2024 through 2027. (c)Based on the closing market price of the Company's Class A common stock on December 29, 2023, the last market trading day in the year ended December 31, 2023, of $88.22.

  26. Stock Vested Table for Fiscal Year 2023

    Stock Vested Table for Fiscal Year 2023 The following table sets forth summary information relating to the stock vested for the Company's Named Executive Officers during the fiscal year ended December 31, 2023.

  27. Stock Vested Table for Fiscal Year 2023

    | | Stock awards | | | Name | Number of shares acquired on vesting | Value realized on vesting ($) (c) | | Jeffrey R. Noordhoek | 3,904(a) | 353,039 | | Terry J. Heimes | 3,904(a) | 353,039 | | James D. Kruger | 3,904(a) | 353,039 | | Timothy A. Tewes | 3,904(a) | 353,039 | | Matthew W. Dunlap | 544(b) | 49,608 |

  28. Stock Vested Table for Fiscal Year 2023

    (a) Amount represents shares of restricted Class A common stock issued on March 10, 2021 and 2022 pursuant to the Company's Restricted Stock Plan. (b) Amount represents shares of restricted Class A common stock issued on June 12, 2017, March 12, 2018, March 11, 2019, March 10, 2020, and March 10, 2022 pursuant to the Company's Restricted Stock Plan. (c) The closing market price of the Company's Class A common stock as of March 10, 2023 (the vesting date for the 3,904 shares vested for Messrs. Noordhoek, Heimes, Kruger, and Tewes, and the 494 shares vested for Mr. Dunlap) was $90.43. The vesting price for the 50 shares of common stock that vested for Mr. Dunlap on June 10, 2023 was $98.71 per share, which was the closing price of the Company's Class A common stock on June 12, 2023, the first market trading day after the scheduled vesting date.

  29. Pay Versus Performance

    Pay Versus Performance

  30. Pay Versus Performance

    | Year | Summary compensation table total for CEO ($) | Compensation actually paid to CEO ($)(a) | Average summary compensation table total for non-CEO Named Executive Officers ($)(b) | Average compensation actually paid to non-CEO Named Executive Officers ($)(a)(b) | Value of initial fixed $100 investment based on: | | Net income (in thousands) ($) | Net income, excluding derivative market value adjustments (in thousands) ($)(e) | | | | | | | Total shareholder return ($)(c) | Peer group total shareholder return ($)(c)(d) | | | | 2023 | 1,842,156 | 1,791,032 | 1,636,444 | 1,596,230 | 159.00 | 133.20 | 91,532 | 123,279 | | 2022 | 2,224,882 | 2,161,604 | 1,984,696 | 1,937,237 | 161.65 | 118.77 | 407,347 | 231,262 | | 2021 | 2,732,315 | 3,047,713 | 2,302,547 | 2,539,095 | 172.04 | 132.75 | 393,286 | 322,748 | | 2020 | 1,568,311 | 1,568,311 | 1,523,191 | 1,519,833 | 124.04 | 98.31 | 352,443 | 373,832 |

  31. Pay Versus Performance

    (a) The following adjustments were made to calculate the compensation actually paid from the compensation included in the summary compensation table for the CEO and non-CEO Named Executive Officers.

  32. Pay Versus Performance

    | Year | Summary compensation table total for CEO ($) | Less: Issuance date fair value of restricted stock awards issued in respective year ($) | Plus: Year-end fair value of restricted stock awards issued during respective year and unvested at respective year-end ($) | Plus: Change in fair value of restricted stock awards from the end of the prior year of any awards granted in prior years that are outstanding and unvested at respective year-end ($) | Plus: Change in fair value of restricted stock awards as of the vesting date from the end of the prior year of restricted shares issued in prior years and vested during respective year ($) | Compensation actually paid to CEO ($) | | 2023 | 1,842,156 | (500,013) | 482,828 | (32,690) | (1,249) | 1,791,032 | | 2022 | 2,224,882 | (500,016) | 549,219 | (74,657) | (37,824) | 2,161,604 | | 2021 | 2,732,315 | (1,000,059) | 1,315,457 | — | — | 3,047,713 | | 2020 | 1,568,311 | — | — | — | — | 1,568,311 |

  33. Pay Versus Performance

    | Year | Average summary compensation table total for non-CEO Named Executive Officers ($) | Less: Issuance date fair value of restricted stock awards issued in respective year ($) | Plus: Year-end fair value of restricted stock awards issued during respective year and unvested at respective year-end ($) | Plus: Change in fair value of restricted stock awards from the end of the prior year of any awards granted in prior years that are outstanding and unvested at respective year-end ($) | Plus: Change in fair value of restricted stock awards as of the vesting date from the end of the prior year of restricted shares issued in prior years and vested during respective year ($) | Average compensation actually paid to non-CEO Named Executive Officers ($) | | 2023 | 1,636,444 | (375,010) | 362,121 | (26,448) | (877) | 1,596,230 | | 2022 | 1,984,696 | (375,012) | 411,914 | (55,993) | (28,368) | 1,937,237 | | 2021 | 2,302,547 | (750,044) | 986,592 | — | — | 2,539,095 | | 2020 | 1,523,191 | — | — | — | (3,358) | 1,519,833 |

  34. Pay Versus Performance

    (b) The Company's non-CEO Named Executive Officers for 2023 were Mr. Heimes, Mr. Kruger, Mr. Tewes, and Mr. Matthew Dunlap. For 2022, 2021, and 2020, the Company's non-CEO Named Executive Officers were Mr. Michael Dunlap, Mr. Heimes, Mr. Kruger, and Mr. Tewes. (c) Total shareholder return assumes a $100 investment on December 31, 2019 in each of the Company's Class A common stock and in the Company's selected peer group, and that all dividends, if applicable, were reinvested. The shareholder return represents past performance and should not be considered an indication of future performance. (d) The S&P 500 Financials index, which is comprised of approximately 70 companies included in the S&P 500 that are classified as members of the Global Industry Classification Standard financials sector, was selected as the Company's peer group. (e) Net income, excluding derivative market value adjustments, is a non-GAAP financial measure, and there is no comprehensive, authoritative guidance for the presentation of this measure. For information on how this measure is calculated from the Company’s financial statements, reconciliation to the most directly comparable financial measure for the respective years presented in this table under GAAP, and other information about this measure, please refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Overview - GAAP Net Income and Non-GAAP Net Income, Excluding Adjustments on page 40 of the Company’s 2023 Annual Report on Form 10-K filed with the SEC on February 27, 2024 (for years ended December 31, 2023, 2022, and 2021), and page 40 of the Company's 2021 Annual Report on Form 10-K filed with the SEC on February 28, 2022 (for the year ended December 31, 2020). The relationship between the compensation actually paid to the CEO and the average compensation actually paid to the non-CEO Named Executive Officers and the cumulative total shareholder return ("TSR") of the Company and the Peer Group (the S&P 500 Financials index) for 2023, 2022, 2021, and 2020 is represented by the graph below: The relationship between the compensation actually paid to the CEO and the average compensation actually paid to the non-CEO Named Executive Officers and the Company's net income for 2023, 2022, 2021, and 2020 is represented by the graph below: The relationship between the compensation actually paid to the CEO and the average compensation actually paid to the non-CEO Named Executive Officers and the Company's net income, excluding derivative market value adjustments, for 2023, 2022, 2021, and 2020 is represented by the graph below:

  35. Pay Versus Performance

    | Most important financial performance measures linked to Executive Compensation: | | | | Net income, excluding derivative market value adjustments | | | Annual growth in Nelnet, Inc. per share book value (with dividends included) |

  36. Potential Payments Upon Termination or Change-in-Control

    Potential Payments Upon Termination or Change-in-Control Other than with respect to provisions in restricted stock award agreements for certain grants of restricted stock to the Named Executive Officers whereby any unvested shares of restricted stock will become fully vested upon a termination of employment as a result of death, disability, or retirement after reaching the age of 65, which provisions are generally included in all agreements for restricted stock awards granted to employees, the Company does not have any contracts, agreements, plans, or arrangements with the Named Executive Officers that provide for payment in connection with any termination of employment or change-in-control of the Company. The summary information related to the outstanding shares of unvested restricted stock including the market value of such unvested shares as of December 31, 2023 can be found in the table above under "Outstanding Equity Awards at Fiscal Year-End Table (As of December 31, 2023)."

  37. Pay Ratio Disclosure

    Pay Ratio Disclosure As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of the SEC’s Regulation S-K, the Company is providing the following information about the relationship of the annual total compensation of the employees of the Company and its consolidated subsidiaries and the annual total compensation of Jeffrey R. Noordhoek, the Company’s CEO. For 2023, the Company’s last completed fiscal year: •the median of the annual total compensation of all employees of the Company and its consolidated subsidiaries (other than the CEO) was $41,287; and •the annual total compensation of the CEO, as disclosed above in the "Summary Compensation Table for Fiscal Years 2023, 2022, and 2021," was $1,842,156. Based on this information, for 2023 the ratio of the annual total compensation of the CEO to the median of the annual total compensation of all employees was 45 to 1. This ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of the SEC’s Regulation S-K. Given the different methodologies that various public companies may use to compute estimates of their pay ratios, the Company’s estimated pay ratio may not be comparable with the estimated pay ratios of other public companies. For purposes of the pay ratio disclosure, SEC rules permit registrants to identify the median employee once every three years, so long as there have not been significant changes in the registrant's employee population or employee compensation arrangements that the registrant reasonably believes would result in a significant change in the pay ratio disclosure. The Company most recently identified its median employee in 2021. The Company identified no significant changes to its employee population or employee compensation arrangements in 2023 as compared to 2021, and as such, used the same median employee identified in 2021 for the 2023 pay ratio calculation. To determine the annual total compensation of the median employee and the CEO in 2023, the methodology and the material assumptions, adjustments, and estimates that the Company used were as follows: 1.Using the median employee identified as described above, the Company combined all of the elements of such employee’s compensation for 2023 in accordance with the requirements of Item 402(c)(x) of the SEC’s Regulation S-K, resulting in annual total compensation of $41,287. 2.With respect to the annual total compensation of the CEO, the Company used the amount disclosed in the “Total” column of the 2023 row for Mr. Noordhoek in the "Summary Compensation Table for Fiscal Years 2023, 2022, and 2021" included in this Proxy Statement.

  38. Policies and Procedures for Transactions with Related Parties

    •Ms. Butterfield - Ms. Butterfield is a significant shareholder of the Company, and is also a co-trustee of the Stephen F. Butterfield GST Non-Exempt Marital Trust (the "Butterfield GST Non-Exempt Marital Trust"), which is also a significant shareholder of the Company. As of February 29, 2024, Ms. Butterfield and the Butterfield GST Non-Exempt Marital Trust beneficially owned 7.8% and 4.9%, respectively, of the Company's outstanding common stock.