DEF 14A of TWFG, Inc.
Filed Apr 11, 2025 · FY20240001628280-25-017483
Julie E. Benes
| Summary Compensation Table | 23 | | Narrative Disclosure to Summary Compensation Table | 23 | | Outstanding Equity Awards at Fiscal Year-End | 24 | | Additional Narrative Disclosure | 24 | | Potential Payments upon Termination or Change in Control | 24 | | Equity Compensation Plan Information | 25 | | Certain Relationships and Related-Party Transactions | 26 | | Indemnification Agreements with our Directors and Officers | 30 | | Audit Committee Report | 31 | | Proposal Two - Ratification of Appointment of Independent Registered Public Accounting Firm | 32 | | Pre-Approval Policies and Procedures | 33 | | Availability of Annual Report on Form 10-K | 34 | | Questions and Answers | 35 | | Other Business | 41 | | Appendix | A-1 |
Director Biographies
Director Biographies The following is a brief biographical summary of the experience of our director nominees:
Director Biographies
| | | RICHARD F. BUNCH III is an entrepreneur who founded TWFG in 2001. Mr. Bunch has served as Chairman, President and Chief Executive Officer of TWFG since its inception. Mr. Bunch has over 28 years of industry experience. Prior to founding TWFG, Mr. Bunch worked in the insurance industry as a Manager, Financial Services at Prudential, Associate General Agent at American National and Agent at Texas Farm Bureau. Mr. Bunch holds multiple professional licenses, including Life & Health Agent, Property & Casualty Agent, Managing General Agent, Surplus Lines Agent and Lloyd’s of London Coverholder. Mr. Bunch previously held FINRA Series 6, 7, 24, 63 and 65 licenses. Mr. Bunch also served in the U.S. Coast Guard as Petty Officer 3rd Class with a focus on logistics, accounting, U.S. General Services Administration contracting and law enforcement. During his time in service, Mr. Bunch embarked on several deployments, including the Hurricane Andrew Emergency Response Team, Human Trafficking & Drug interdiction, and Search & Rescue. He currently serves as the Capital Campaign Chair for the Future National Coast Guard Museum. Mr. Bunch also served on The Woodlands Township Board of Directors from 2012 to 2022, including as the elected Chairman from 2016 to 2022. Mr. Bunch was named the 2015 Ernst & Young Products & Services Entrepreneur of the Year for the Gulf Coast Region. We believe Mr. Bunch’s extensive industry and leadership experience and his insight into our business as our founder and Chief Executive Officer make him a valuable member of our Board. | | | Richard F. (“Gordy”) Bunch III Chief Executive Officer, Chairman and Director Age: 52 Director Since: 2024 | |
Director Biographies
| TWFG, INC. | 3 | 2025 Proxy Statement |
Director Biographies
| | | MICHAEL DOAK is the lead independent director and has served on our Board since the Company's inception in January 2024. Mr. Doak has served as the Chief Executive Officer and Managing Partner of Griffin Highline Capital since 2020. Prior to founding Griffin Highline Capital, he served in various leadership roles at entities associated with RenaissanceRe and as the portfolio manager of the direct investments portfolio. Mr. Doak currently serves on the board of managers of Open Road Ultimate Holdings LLC, Inness Ultimate Holdings LLC and Dallas Specialty Ultimate Holdings LLC. He was previously a director and chair of the Nominating and Governance Committee of Trupanion, Inc., a director at Falcon Risk Holdings LLC, a director of Tower Hill Insurance Group and a director of DaVinci Reinsurance Ltd. Mr. Doak earned his Bachelor of Arts degree from the University of Virginia and his Juris Doctor degree from the University of Pennsylvania Law School. We believe Mr. Doak is qualified to serve on our Board due to his experience advising insurance and high growth companies, his financial and investment expertise and his experience with private and public companies. | | | Michael Doak Lead Independent Director Age: 49 Director Since: 2024 | |
Director Biographies
| | | JONATHAN ANDERSON has served on our Board since the Company's inception in 2024. Mr. Anderson has served as Senior Vice President, Global Head – Strategic Investments of RenaissanceRe, a Property & Casualty reinsurance provider, since 2020. Prior to joining RenaissanceRe, Mr. Anderson was an Executive Director in Morgan Stanley’s Investment Banking group, advising insurance companies on Mergers & Acquisitions (“M&A”) and capital raising transactions from 2010 to 2020. Mr. Anderson earned his Bachelor of Arts degree from the Ivey School of Business at Western University and his Master of Business Administration degree from The University of Chicago Booth School of Business. We believe Mr. Anderson is qualified to serve on our Board due to his experience advising boards and executives of insurance companies, his expertise in finance and corporate governance and his experience in the insurance industry. | | | Jonathan Anderson Director Age: 46 Director Since: 2024 | |
Director Biographies
| TWFG, INC. | 4 | 2025 Proxy Statement |
Director Biographies
| | | MICHELLE CAROLINE BUNCH has served on our Board since the Company's inception in January 2024. She was previously licensed as a Life & Health Agent and Property & Casualty Agent and worked as an insurance agent with American National. Ms. Bunch earned her Bachelor of Science degree from the University of North Texas. We believe Ms. Bunch is qualified to serve on our Board due to her insurance industry experience and extensive knowledge of TWFG’s business. | | | Michelle Caroline Bunch Director Age: 53 Director Since: 2024 | |
Director Biographies
| | | ROBIN A. FERRACONE has served on our Board since July 2024, when the Company completed its IPO. Since 2007, Ms. Ferracone has served as the Chief Executive Officer of Farient Advisors LLC, a performance and strategic compensation advisory firm. Previously, she was Vice Chair of the western region of Marsh & McLennan Companies, Inc. (“MMC”), a global professional services firm in the areas of risk, strategy, and human capital, and President, Human Capital Business of Mercer, a subsidiary of MMC. Ms. Ferracone served as a member of Trupanion Inc.’s (“Trupanion”) board of directors from 2015 to 2021. She also served as Chair of Trupanion’s Compensation Committee from 2015 to 2021 and was a member of Trupanion’s Nominating and Corporate Governance Committee from 2015 to 2021. Ms. Ferracone holds a Master of Business Administration from the Harvard Business School and a Bachelor of Arts degree in Economics and Management Science from Duke University. We believe Ms. Ferracone is qualified to serve on our Board due to her extensive expertise in corporate governance, human capital and compensation consulting, her leadership experience, her prior service on a public company board, and her experience as an insurance brokerage and consulting company executive. | | | Robin A. Ferracone Director (Chair of the Compensation Committee) Age: 71 Director Since: 2024 | |
Director Biographies
| TWFG, INC. | 5 | 2025 Proxy Statement |
Director Biographies
| | | JANET S. WONG has served on our Board since July 2024, when the Company completed its IPO. Ms. Wong is a licensed Certified Public Accountant with more than 30 years of public accounting experience. She is a partner (retired) with KPMG LLP, an international professional services firm, where she served as a National Practice Lead Partner from 1995 to 2008. Ms. Wong has served as a director of Lucid Group, Inc., a technology manufacturer of electric vehicles and energy storage, since 2021. Ms. Wong previously served as a director of Enviva Inc., a global energy company, from 2015 to December 2024 and a director of Lumentum Holdings Inc., a manufacturer of innovative optical and photonic products as well as a developer of next-generation technologies from 2020 to November 2024. In addition, she previously served as a director of Shine Technologies, a private company focusing on nuclear technology and clean energy, from 2021 to 2022 and a director of Allegiance Bancshares, Inc., a commercial banking organization, from 2020 to 2022. She also served on the advisory board of Big Controls Inc., a business intelligence and analytics company, from 2016 to 2020. She currently serves as a trustee on the non-profit board of the Louisiana Tech University Foundation. She holds a Master of Professional Accountancy from Louisiana Tech University and a Master of Taxation from Golden Gate University. She is a NACD (National Association of Corporate Directors) Certified Director. She has completed executive education programs for corporate board directors at Harvard Business School and Stanford Law School. We believe Ms. Wong is qualified to serve on our Board due to her extensive experience and expertise in finance, board governance, risk and regulatory matters (including cyber), M&A and strategy. | | | Janet S. Wong Director (Chair of the Audit Committee) Age: 66 Director Since: 2024 | |
Community Involvement Initiatives
Director Compensation Our non-employee directors receive equity and cash compensation for their service as directors. Non-employee directors receive annual cash compensation of $60,000 for service on our Board and additional compensation for committee service as follows: •Audit Committee – $20,000 for the chair; •Compensation Committee – $15,000 for the chair; and •Lead Independent Director – $20,000. In addition, each non-employee director receives an annual grant of restricted stock units (“RSUs”) with a grant date fair value of $80,000. All RSUs granted to non-employee directors will vest fully on the first anniversary of the grant date, subject generally to the non-employee director’s continued service on the Board. In the event that a non-employee director’s service on the Board is terminated for any reason, a pro-rated portion of the RSUs will vest on the termination date, determined based on a fraction, the numerator being the number of days elapsing from the grant date through and until (but not including) the termination date and the denominator being 365. RSUs may be settled in cash or in shares of Class A Common Stock. Directors who are employees of TWFG receive no compensation for their service as directors.
Director Compensation Table
Director Compensation Table The following table summarizes the compensation of our non-employee directors who served during 2024. The directors received compensation for their services for a partial year (from July 2024). Richard F. ("Gordy") Bunch III, our Chairman and CEO, received no compensation in connection with his service as director and, accordingly, he is omitted from this table.
Director Compensation Table
| Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(1)(2)(3) | Total ($) | | Michael Doak | 40,000 | 60,000 | 100,000 | | Jonathan Anderson | 30,000 | 60,000 | 90,000 | | Janet S. Wong | 40,000 | 60,000 | 100,000 | | Robin A. Ferracone | 37,500 | 60,000 | 97,500 | | Michelle Caroline Bunch | 30,000 | 60,000 | 90,000 |
Director Compensation Table
1.Represents prorated fees for partial year of service for directors since July 2024, when the Company went public. 2.Represents the aggregate grant-date fair value of 3,529 shares of RSUs granted to each non-employee director on July 17, 2024, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification ("ASC") Topic 718. RSUs vest fully on the first anniversary of the grant date. The grant-date fair value is based on $17 per share, the closing price of our Class A Common Stock on the grant date. The assumptions used in calculating the grant-date fair value of the awards reported in this column are set forth in Note 8 to our audited consolidated financial statements included in our Form 10-K. 3.As of fiscal year end, the aggregate number of unvested RSUs of Class A Common Stock for each director was 1,914. As of March 1, 2025, the aggregate number of unvested restricted stock units of Class A Common Stock for each director was 1,334.
Director Compensation Table
| TWFG, INC. | 13 | 2025 Proxy Statement |
Director Compensation Table
Ownership of Common Stock
Summary Compensation Table
Summary Compensation Table The table below sets forth the annual compensation earned by our NEOs for the years ended December 31, 2024 and December 31, 2023.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Stock Awards(1) ($) | Non-Equity Incentive Plan Compensation($) | All Other Compensation ($) | Total ($) | | Richard F. ("Gordy") Bunch III Chief Executive Officer and Chairman | 2024 | 700,000 | 2,298,500 | — | 38,887 | 3,037,387 | | | 2023 | 700,000 | | — | 34,359 | 734,359 | | Katherine C. Nolan Chief Operating Officer | 2024 | 400,000 | 1,500,000 | 146,272 | 28,586 | 2,074,858 | | | 2023 | 400,000 | | 75,000 | 34,359 | 509,359 | | Janice E. Zwinggi Chief Financial Officer | 2024 | 387,500 | 1,000,000 | 146,272 | 28,586 | 1,562,358 | | | 2023 | 375,000 | | 70,000 | 14,635 | 459,635 |
Summary Compensation Table
1.The amounts reported reflect the grant date fair value of the RSUs granted to the NEOs as computed in accordance with ASC 718. The assumptions that we used to calculate these amounts are discussed in Note 8 to our financial statements included in our Form 10-K, and incorporated by reference herein. As required by SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions.
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The table below sets forth the outstanding equity awards held by the NEOs as of December 31, 2024.
Outstanding Equity Awards at Fiscal Year-End
| | Stock Awards | | | Name | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(1) | | Richard F. ("Gordy") Bunch III | 135,205 | 4,164,314 | | Katherine C. Nolan | 88,235 | 2,717,638 | | Janice E. Zwinggi | 58,823 | 1,811,748 |
Outstanding Equity Awards at Fiscal Year-End
1.The IPO RSUs vest in substantially equal installments as follows: the first installment vested on January 17, 2025, and the second and third installments vest on July 17, 2025 and July 17, 2026, respectively.
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control Pursuant to the IPO RSU Award Agreements, the IPO RSUs will fully vest immediately prior to a Change in Control (as defined in the Plan), provided that the NEO remains in continuous employment with the Company on such date. Other than the IPO RSU Award Agreements, in 2024, there were no contracts, agreements, plans or arrangements, whether written or unwritten, that provide for payment to an NEO at, following, or in connection with the NEO’s resignation, retirement or other termination, a change in control or a change in the NEO’s responsibilities following a change in control, with respect to each NEO.
Potential Payments upon Termination or Change in Control
| TWFG, INC. | 24 | 2025 Proxy Statement |
Potential Payments upon Termination or Change in Control
Equity Compensation Plan Information The following table provides certain information with respect to our equity compensation plan in effect as of December 31, 2024. The Plan, was approved by our stockholders, and remains in effect as of April 1, 2025.
Potential Payments upon Termination or Change in Control
| Plan Category | Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights(1)(2) (#) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans(3) (#) | | Equity Compensation Plans Approved By Stockholders(1) | 4,346,667 | 3,917,477 | | Total | 4,346,667 | 3,917,477 |
Potential Payments upon Termination or Change in Control
1.Reflects shares outstanding under the Plan. 2.Consists of 429,190 shares of our Class A Common Stock subject to RSU awards under our 2024 Plan. 3.Consists of shares of Class A Common Stock available for issuance.
Potential Payments upon Termination or Change in Control
| TWFG, INC. | 25 | 2025 Proxy Statement |
Potential Payments upon Termination or Change in Control
Certain Relationships and Related-Party Transactions The Board adopted a written Related-Party Transactions Policy (the “Policy”), which sets forth our policy with respect to the review, approval, ratification and disclosure of all Related-Party Transactions by our Audit Committee. In accordance with the Policy, our Audit Committee has overall responsibility for implementation of and compliance with the Policy. Under the Policy, a “Related-Party Transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we were, are or will be a participant and the amount involved exceeded, exceeds or will exceed $120,000 in any fiscal year and in which any Related Party (i.e., any of our executive officers, directors (including director nominees) or stockholders owning in excess of 5% of any class of the Company’s voting securities or their immediate family members) had, has or will have a direct or indirect material interest. A “Related-Party Transaction” does not include any employment relationship or transaction involving an executive officer and any related compensation resulting solely from that employment relationship that has been reviewed and approved by our Board. The Policy requires that notice of a proposed Related-Party Transaction be provided to our General Counsel prior to entry into such transaction. If our General Counsel determines that such transaction is a Related-Party Transaction, the proposed transaction will be submitted to our Audit Committee for consideration at its next meeting. Under the Policy, our Audit Committee may approve only those Related-Party Transactions that are in, or not inconsistent with, our best interests. In the event that we become aware of a Related-Party Transaction that has not been previously reviewed, approved or ratified under the Policy and that is ongoing or is completed, the transaction will be submitted to the Audit Committee so that it may determine whether to ratify, rescind or terminate the Related-Party Transaction. The Policy also provides that the Audit Committee reviews certain previously approved or ratified Related-Party Transactions that are ongoing to determine whether the Related-Party Transactions remains in our best interests and the best interests of our stockholders. Additionally, we will make periodic inquiries of directors and executive officers with respect to any potential Related-Party Transaction of which they may be a party or of which they may be aware. We describe below the approved Related-Party Transactions during our last fiscal year:
Indemnification Agreements with our Directors and Officers
Indemnification Agreements with our Directors and Officers We have entered into indemnification agreements with each of our directors and our executive officers. The indemnification agreements and our Bylaws require us to indemnify our directors and officers to the fullest extent permitted by Delaware law, including indemnification of expenses such as attorney's fees incurred by the director or executive officer in any action or proceeding, including any action or proceeding by or in right of us, arising out of the person's services as a director or executive officer.
Indemnification Agreements with our Directors and Officers
| TWFG, INC. | 30 | 2025 Proxy Statement |
Indemnification Agreements with our Directors and Officers
Audit Committee Report With respect to TWFG's financial reporting process, the management of TWFG is responsible for establishing and maintaining internal controls and preparing TWFG's consolidated financial statements. TWFG's independent registered public accounting firm, Deloitte & Touche, LLP, (“Deloitte”) is responsible for auditing these financial statements. It is the responsibility of the Audit Committee to oversee these activities. The Audit Committee does not itself prepare financial statements or perform audits, and its members are not auditors or certifiers of TWFG's financial statements. We have relied, without independent verification, on management's representation that the financial statements have been prepared with integrity and objectivity and in conformity with U.S. Generally Accepted Accounting Principles and on the representations of Deloitte included in its audit of TWFG's consolidated financial statements. We have reviewed and discussed the audited consolidated financial statements for the fiscal year ended December 31, 2024 with TWFG's management and with Deloitte, including the results of the independent registered public accounting firm's audit of TWFG's financial statements. We have also discussed with Deloitte all matters required to be discussed by the Standards of the Public Company Accounting Oversight Board ("PCAOB") for communication with audit committees, under which Deloitte must provide us with additional information regarding the scope and results of its audit of TWFG's consolidated financial statements. We have also received and reviewed the written disclosures and the letter from Deloitte required by applicable requirements of the PCAOB regarding Deloitte's communications with the Audit Committee concerning independence, and have discussed with Deloitte its independence from TWFG, as well as any relationships that may impact Deloitte's objectivity and independence. Based on our review of the matters noted above and our discussions with TWFG's management and independent registered public accountants, we recommended to the Board that the audited consolidated financial statements be included in TWFG's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, for filing with the Securities and Exchange Commission.
Q: How do I recommend a director nominee?
Q: How do I recommend a director nominee? A: If you wish to nominate an individual for election as director at the 2026 Annual Meeting of Stockholders, we must receive your written nomination on or after January 28, 2026, but no later than February 27, 2026. You should send your proposal to: TWFG, Inc., 10055 Grogans Mill Rd, Suite 500, The Woodlands, TX 77380, Attention: Corporate Secretary. The notice of nomination must detail the information specified in the Bylaws. We will not entertain any nominations at the 2026 Annual Meeting that do not meet the requirements set forth in our Bylaws. The Bylaws can be found on the SEC website (https://www.sec.gov) as Exhibit 3.2 to the Form 8-K that was filed on July 17, 2024. To make a submission or to request a copy of our Bylaws, stockholders should contact our Corporate Secretary at TWFG, Inc., 10055 Grogans Mill RD, Suite 500, The Woodlands, TX 77380.
Q: How do I recommend a director nominee?
| TWFG, INC. | 40 | 2025 Proxy Statement |
Q: How do I recommend a director nominee?
Other Business Our Board does not know of any other matters to be presented at the Annual Meeting. If any additional matters are properly presented at the Annual Meeting, the persons named in the proxy card will have discretion to vote the shares represented by proxy in accordance with their own judgment on such matters. It is important that your shares be represented at the Annual Meeting, regardless of the number of shares that you hold. We urge you to vote by telephone, by Internet or by executing and returning the proxy card at your earliest convenience.
Q: How do I recommend a director nominee?
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Q: How do I recommend a director nominee?
Appendix