DEF 14A of Firstsun Capital Bancorp, Mar 21, 2025

DEF 14A of Firstsun Capital Bancorp

Filed Mar 21, 2025 · FY20240001709442-25-000020

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS Our board of directors is currently comprised of nine directors who are divided into three classes designated as Class I, Class II, and Class III with approximately equal in number, serving staggered three-year terms. One class of directors is elected by our stockholders at each annual meeting to serve from the time of their election until the third annual meeting of stockholders following their election. As a result, the terms of only approximately one-third of our board members expire at each annual meeting. However, Proposal 2, if approved by our stockholders at this annual meeting, would amend our certificate of incorporation to declassify the board by the 2028 annual meeting of our stockholders, at which time all directors would be elected annually to serve until the next annual meeting of our stockholders. See Proposal 2 for additional details. Each of the nominees for election to Class II is currently a director of the Company. Following a review and recommendation of nomination from our Nominating and Governance Committee and pursuant to the director designation rights of certain stockholders, our board has renominated each of our Class II directors, Neal E. Arnold, David W. Levy, and Kevin T. Hammond, to serve as Class II directors for a three year-term expiring at our 2028 annual meeting and until their respective successors are duly elected and qualified.

  2. Class II Director Nominees

    Class II Director Nominees

  3. Class II Director Nominees

    | Name | Age | Served as Director Since | | Neal E. Arnold | 65 | 2017 | | David W. Levy | 68 | 2017 | | Kevin T. Hammond | 44 | 2022 |

  4. Class II Director Nominees

    The Class II directors will be elected by a plurality of the votes of the holders of shares present in person or represented by proxy at the annual meeting and entitled to vote on the election of directors. The three nominees receiving the highest number of affirmative votes will be elected. There is no cumulative voting with respect to the election of directors. Proxies cannot be voted for a greater number of persons than the number of nominees named in this proxy statement. The board of directors recommends that you vote “FOR” each of the above Class II director nominees. Set forth below is information concerning our other directors, whose term of office will continue after the annual meeting, including their age and year first elected or appointed as a director.

  5. Continuing Directors

    Continuing Directors

  6. Continuing Directors

    | Name | Age | Served as Director Since | | Class III (term expires 2026) | | | | Diane L Merdian | 65 | 2017 | | Paul A. Larkins | 64 | 2019 | | John S. Fleshood | 62 | 2025 | | Class I (term expires 2027) | | | | Mollie H. Carter | 62 | 2017 | | Beverly O. Elving | 71 | 2021 | | Isabella Cunningham | 82 | 2022 |

  7. Continuing Directors

    As a result of Chris C. Casciato’s resignation from the board, effective as of December 19, 2024, the board had a vacancy in Class III. Following a review and recommendation from the Nominating and Governance Committee, on March 5, 2025 the board appointed John S. Fleshood to fill the vacancy and serve as a Class III director to serve the remaining Class III director term ending in 2026. In addition, under the Company’s Stockholders’ Agreement (which has now been terminated), Southwest Banking Partners, L.P. (“SWBP”) was entitled to nominate one Class III director for election to the board; however, SWBP elected not to exercise its right to nominate a director. Accordingly, the board had an additional vacancy in Class III. All directors will hold office for the terms indicated, or until their earlier death, resignation, removal or disqualification and until their respective successors are duly elected and qualified. No nominee, member of the board of directors or executive officer is related to any other nominee, member of the board of directors or executive officer. Certain directors have been nominated for election and serve on our board of directors pursuant to the provisions of a Stockholders’ Agreement between FirstSun and certain of our stockholders which was terminated in its entirety by the parties to the agreement as of February 21, 2025. While no stockholder has any rights remaining under the Stockholders’ Agreement, certain members of our board of directors were previously nominated for election in accordance with a stockholder’s rights provided by the Stockholders’ Agreement. The following board nominees and ongoing directors were nominated to the board by a stockholder pursuant to the Stockholders’ Agreement, each of whom own 5% or more of the shares of our common stock: Director Nominees: •Neal E. Arnold, Class II director nominee, was nominated by the Dana Hale Nelson Trusts; •Kevin T. Hammond, Class II director nominee, was nominated by JLL FCH Holdings I, LLC; and •David W. Levy, Class II director nominee, was nominated by the John J. Hale Trust. Continuing Directors, previously nominated: •Mollie H. Carter, Class I director, nominated by the Mollie Hale Carter Trusts; •Beverly O. Elving, Class I director, nominated by the Karen Hale Young Trusts; •Paul A. Larkins, Class III director nominated by Aquiline SGB Holdings LLC; and •Diane L. Merdian, Class III director, nominated by the Max Alan Hale Trusts. See “Corporate Governance and the Board of Directors - Certain Relationships and Related Party Transactions – Other Relationships– Stockholders’ Agreement.”

  8. Director Experience

    Director Experience Biographical information regarding each of our director nominees and continuing directors is set forth below, including the particular experience, qualifications, attributes or skills that led the board to conclude that each member is qualified to serve on the board and any committee he or she serves.

  9. Class II Director Nominees

    Class II Director Nominees Neal E. Arnold is the current President and Chief Executive Officer of the Company and Sunflower Bank and also serves as the Chief Operating Officer of the Company. He was appointed as President and Chief Executive Officer of the Company on April 1, 2022, and has held the positions of President and Chief Executive Officer of Sunflower Bank and Chief Operating Officer of the Company since 2018. Mr. Arnold served as Executive Vice President of Fifth Third Bancorp and Fifth Third Bank from 1998 to 2005, and as Chief Financial Officer of Fifth Third Bancorp and Fifth Third Bank from 1997 to 2005. Before that, he served as Treasurer of Fifth Third Bancorp and Fifth Third Bank, and as Senior Vice President of Fifth Third Bank. Prior to joining Fifth Third, he served as Chief Financial Officer and Chief Operating Officer of Midwestern Community Bank from 1980 to 1989. Mr. Arnold’s qualifications to serve as a director include his substantial C-suite leadership experience and as a chief financial officer of a large public company. Mr. Arnold has over 30 years of experience completing numerous regulatory compliance consulting engagements for bank boards. David W. Levy is the former Managing Director at Pickwick Capital Partners, a position he held from 2012 to 2025. He serves as a director of Old Dominion National Bank since 2013, and as a director of the holding company ODNB Financial Corp since 2022. He has served as Vice Chairman of Investment Banking and Co-Head of the Financial Institutions Group at Cowen & Company from 2009 to 2010 and served as Senior Managing Director at Bear Stearns from 2005 to 2008. Mr. Levy spent over 23 years at Citigroup Global Markets as a Managing Director and Head of the Bank and Financial Services Group, and Salomon Brothers Inc. as a Managing Director and Co-Head of the Financial Institutions Department. Mr. Levy's qualifications to serve as a director include his leadership experience, managing director positions with globally recognized investment banking firms, and prior service as a member of the Audit and Compensation and Succession Committees of another financial institution. Kevin T. Hammond previously served as a director of Pioneer Bancshares, Inc. from 2016 until April 2022, prior to when he joined the Company board. Mr. Hammond joined JLL Partners in 2004 and is a Managing Director, where he focuses on new private equity investments and managing the firm’s portfolio of companies. He serves on JLL Partners’ management and investment committees. Prior to joining JLL, he worked in merger advisory and private equity at Greenhill & Co. In addition, he previously served as a director of FC Holdings, Inc. and First Community Bank, N.A. Mr. Hammond’s qualifications to serve as a director include his experience in managing financial transactions and extensive past and current director service on corporate boards.

  10. Continuing Directors

    Continuing Directors Mollie H. Carter is the current Executive Chair of the Company and Bank, a position she has held since April 1, 2022. Prior to being named Executive Chair, she served as Chair of both the Company and Bank boards since 1996. Ms. Carter served as President and Chief Executive Officer of the Company from 2005 until April 1, 2022, and served as President and Chief Executive Officer of Sunflower Bank from 2005 until 2018. She served as a director of Evergy, Inc. and its predecessor, Westar Energy, a publicly traded company, from 2003 to 2022, including as Chair of the Compensation and Succession Committee. She previously served as a director of Archer-Daniels-Midland Company, a publicly traded company, from 1996 to 2017. Ms. Carter is also a Director of Lockton Companies and serves on its Nominating & Governance Committee and the Audit Committee. Ms. Carter's nonprofit service includes the NPR Foundation Board of Trustees since 2020, and the Rocky Mountain Public Media Board of Directors since 2023. Ms. Carter’s qualifications to serve as our Executive Chair include her substantial leadership experience as a chief executive officer, her financial expertise and her significant experience serving as a director of a large public company. Ms. Carter also has extensive experience with corporate governance, compensation matters, and with complicated financial regulatory and banking compliance environments. Isabella Cunningham joined the Company’s board as a result of the merger with Pioneer effective April 1, 2022. Dr. Cunningham served as a director of Pioneer and Pioneer Bank from 2013 until April 2022. She served as a Director of Viad Corp. and as a member of its Corporate Governance & Nominating Committee and its Human Resources Committee, from 2006 until 2019. Dr. Cunningham holds the Stan Richards Chair in Advertising and Public Relations at the University of Texas at Austin. She retired form her position as the Director of the Stan Richards School in 2014 and is now also the Academic Director of the Tower Fellows Program at The University. Dr. Cunningham still serves on a number of academic committees and is a member of the School Budget Council. She also served as a member of the college Administrative Council, the University Curricular Task Force, the UT Presidential Enrollment Task Force and is a member of the Executive Council of the Latin American Studies School. Dr. Cunningham has served as director on public and private company boards, and on a number of non-profit boards and non-profit institutions including St. Edward’s Board of Trustees, the National Museum of Natural History (Smithsonian) and the Susan G. Komen Breast Cancer Foundation. Dr. Cunningham is a nationally recognized expert in advertising and intellectual property. Dr. Cunningham’s qualifications to serve as a director include her leadership and prior extensive board service, with over 30 years of experience and a variety of board engagements. Beverly O. Elving is the former Director of Corporate Accounting, Vice President & Controller, and Sr. Vice President of Finance at Applebee’s International from 1998 to 2012. She served as the Chief Financial Officer of Integrated Medical Resources from 1996 to 1998, and additionally, Ms. Elving served as Vice President Finance & Accounting for the FDIC/Resolution Trust Corporation from 1990 to 1996. Between 1981 and 1996, Ms. Elving gained senior accounting, auditor, and Certified Public Accountant experience at Jackson County, Missouri, and Arthur Andersen & Co. Ms. Elving’s experience includes her service as a director of several non-profit boards including St. Luke’s Health System-Bishop Spencer Place since 2019 and as board president since 2022, as well as Heart of America Shakespeare Festival as a director since 2019 and as board co-president 2021 to 2023. Ms. Elving’s qualifications to serve as a director include her accounting, finance and C-suite leadership experience including oversight of public companies and government entities. John S. Fleshood has served as Executive Vice President and Chief Operating Officer of TriCo Bancshares since 2016, a position from which he plans to retire in December of 2025. Previously, Mr. Fleshood served in a variety of management positions at Wintrust Financial Corporation, a financial holding company based in Rosemont, IL from 2005 to 2016, including most recently as Executive Vice President and Chief Risk Officer. Mr. Fleshood also served as Senior Vice President and Chief Financial Officer of the Chicago affiliate of Fifth Third Bank from 2001 to 2005, and as Vice President and Manager of the Treasury Division from 1992 to 2001. His qualifications to serve as a director include C-suite leadership, enterprise risk, bank level and public financial holding company atmospheres, as well as extensive M&A and organic growth experiences. Paul A. Larkins is a Senior Advisor with Aquiline Capital Partners, a position he has held since 2018. He also serves as a board member of Amur Equipment Finance, since 2019. He previously served as board chair of LERETA, LLC, and as an advisor to Tarsadia Investments, both from 2019 to 2021. Mr. Larkins served as President and director of SquareTwo Financial Corporation, positions he held from 2009 to 2016. SquareTwo Financial Corporation filed for bankruptcy under Chapter 11 in March 2017. From 1998 to 2009, he served as the Chief Executive Officer and President of Key National Finance in Superior, Colorado. His experience includes service as a Senior Executive Vice President of Key Bank USA and KeyCorp Leasing Ltd., and regional and national roles with USL Capital and IBM. Mr. Larkins' qualifications to serve as a director include his extensive external board and leadership experience with bank, specialty finance (leasing, marine, recreational vehicles, education, home equity, and auto dealer finance), as well as private equity institutions. Diane L. Merdian is the former Chief Financial Officer of Redwood Trust, Inc, a position she held from 2010 to 2012, having previously served on Redwood’s board of directors from 2008 to 2009. From 1984 to 2008, Ms. Merdian was an equity analyst covering financial companies, working at Investment Banking firms and Institutional Investment firms. She primarily analyzed banks, focusing on valuation, strategy, and economics vs. accounting. As a Senior Vice President and Managing Director at Keefe, Bruyette & Woods from 2003 to 2008, Ms. Merdian led Bank Strategy and was head of Large-cap banks. She led the bank research effort at Morgan Stanley from 2000 through 2001 and led the bank research team at Montgomery Securities from 1995 to 2000. Ms. Merdian has also held equity analyst positions at Salomon Brothers, Kemper, Wellington Management, and Salomon Smith Barney. She began her financial career as an Economic Research Associate at the Federal Reserve Bank of Kansas City, focused on monetary policy. Ms. Merdian’s qualifications to serve as a director include her C-suite leadership and over 20 years of experience as an equity analyst in the financial industry. Her strengths include her insight into strategy, valuation, management, and economics vs. accounting, with additional experience in Audit and Compensation matters.

  11. 2024 Summary Compensation Table

    2024 Summary Compensation Table The following table sets forth information concerning all compensation awarded to, earned by or paid to our named executive officers for all services rendered in all capacities to us and our subsidiaries for the fiscal years ended December 31, 2024 and 2023.

  12. 2024 Summary Compensation Table

    | Name and Principal Position | Year | Salary | Bonus1 | Stock Awards2 | Non-Equity Incentive Plan Compensation3 | Nonqualified Deferred Compensation Earnings4 | All other Compensation5 | Total | | Mollie H. Carter | 2024 | $500,000 | $— | $— | $— | $— | $21,300 | $521,300 | | Executive Chair | 2023 | 500,000 | — | — | — | — | 24,361 | 524,361 | | Neal E. Arnold | 2024 | 800,000 | 928,500 | 5,550,010 | 1,021,000 | — | 21,300 | 8,320,810 | | Chief Executive Officer and President of Company and Bank, and Chief Operating Officer of Company | 2023 | 800,000 | 761,600 | 1,400,000 | 1,128,961 | — | 20,400 | 4,110,961 | | Robert A. Cafera, Jr. | 2024 | 454,000 | 493,266 | 2,300,005 | 408,400 | — | 21,300 | 3,676,971 | | Senior Executive Vice President and Chief Financial Officer of Company and Bank | 2023 | 425,000 | 392,224 | 239,988 | 451,584 | — | 20,400 | 1,529,196 | | Laura J. Frazier | 2024 | 382,424 | 338,903 | 1,210,020 | 306,300 | — | 21,300 | 2,258,947 | | Executive Vice President and Chief Administrative Officer of Company and Bank | 2023 | 365,000 | 338,688 | 180,012 | 338,688 | — | 20,400 | 1,242,788 | | 1 See discussion under “Narrative to Summary Compensation Table—Annual Bonus Payment” below. | | | | | | | | | | 2 The amounts reported represent the aggregate grant date fair values of restricted stock units awarded in each fiscal year for which compensation is required to be reported in the table for each named executive officer, in each case computed in accordance with FASB ASC Topic 718. See Note 1 of our annual consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 7, 2025, for a discussion of valuation assumptions. The performance-based awards in the above table are subject to performance conditions and the reported grant date fair value is based on the probable outcome of those conditions as of the grant date, which was assumed to be the target level of the awards. The stock awards in this column include restricted stock awards granted in 2024 with a grant date fair value of $4,000,010 for Mr. Arnold, $2,000,005 for Mr. Cafera and $1,000,020 for Ms. Frazier. These awards were contingent upon the closing of the proposed merger with HomeStreet, Inc. Upon termination of the HomeStreet, Inc. merger agreement, these awards were cancelled and no shares vested in or were awarded to either Mr. Arnold, Mr. Cafera or Ms. Frazier. | | | | | | | | | | 3 The amounts in the Non-Equity Incentive Plan Compensation column are the cash awards earned by the named executive officer under the 2021 Long-Term Incentive Plan (see discussion under “Narrative to Summary Compensation Table—2021 Long-Term Incentive Plan” below). | | | | | | | | | | 4 There were not above-market or preferential earnings on our nonqualified deferred compensation plan. | | | | | | | | | | 5 For 2024, the amounts set forth in this column include the following: | | | | | | | | |

  13. 2024 Summary Compensation Table

    | | Ms. Carter | Mr. Arnold | Mr. Cafera | Ms. Frazier | | 401(k) match | $20,700 | $20,700 | $20,700 | $20,700 | | Cell phone | 600 | 600 | 600 | 600 | | Total | $21,300 | $21,300 | $21,300 | $21,300 |

  14. Outstanding Equity Awards at 2024 Fiscal Year-End

    Outstanding Equity Awards at 2024 Fiscal Year-End The following table provides a summary of unexercised stock option awards outstanding and Performance Stock Units (“PSUs”) which have not vested and other equity incentive plan awards outstanding as of December 31, 2024 for the named executive officers. The vesting provisions applicable to each outstanding option and performance based stock award is described in the footnotes to the following table.

  15. Outstanding Equity Awards at 2024 Fiscal Year-End

    | | Option Awards | | | | Stock Awards | | | | | | Number of Securities Underlying Options Exercisable | Number of Securities Underlying Options Unexercisable | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested | Market Value of Shares or Units of Stock That Have Not Vested | Equity Incentive Plan Awards: Number of Unearned Shares or Units That Have Not Vested1, 2, 3 | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares or Units That Have Not Vested | | Mollie H. Carter4 | — | — | $— | — | — | $— | — | $— | | Neal E. Arnold | 187,590 | — | $20.49 | 2/14/2028 | — | $— | 135,453 | $5,424,893 | | Robert A. Cafera, Jr. | 135,952 | — | $19.72 | 7/20/2027 | — | $— | 24,186 | $968,649 | | Laura J. Frazier | 55,514 | — | $19.72 | 7/20/2027 | — | $— | 17,717 | $709,566 | | 1 Awards of 41,791 (Arnold), 7,164 (Cafera) and 5,373 (Frazier) vest on the third anniversary of the grant date, April 29, 2025. 2 Awards of 50,000 (Arnold), 8,571 (Cafera) and 6,429 (Frazier) vest on the third anniversary of the grant date, March 31, 2026. 3 Awards of 43,662 (Arnold), 8,451 (Cafera) and 5,915 (Frazier) vest on the third anniversary of the grant date, March 31, 2027. 4 In 2024, Ms. Carter exercised 196,375 options and acquired 196,375 shares on exercise. The value realized on exercise was $2,998,646. | | | | | | | | |

  16. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control

  17. Compensation of Directors for Fiscal Year 2024

    Compensation of Directors for Fiscal Year 2024 We do not pay our “inside” employee-directors any additional compensation for their service as directors. For their service in 2024, we paid our non-employee directors the following cash fees: •a Company director service fee of $35,000 ($8,750 payable quarterly); •a Bank director service fee of $20,000 ($5,000 payable quarterly); •an Audit Committee Chair fee of $20,000 ($5,000 payable quarterly to Ms. Elving); •a Compensation and Succession Committee Chair fee of $15,000 ($3,750 payable quarterly to Ms. Merdian); •a Nominating and Governance Committee Chair fee of $10,000 ($2,500 payable quarterly to Mr. Levy); •a Risk Committee Chair fee of $15,000 ($3,750 payable quarterly to Ms. Cunningham); and •committee member fees of: •$10,000 ($2,500 quarterly) to our Audit Committee members other than the Chair, •$7,500 ($1,875 quarterly) to our Compensation and Succession Committee members other than the Chair, •$5,000 ($1,250 quarterly) to our Nominating and Governance Committee members, other than the Chair, and •$7,500 ($1,875 quarterly) to our Risk Committee members, other than the Chair. Director fees are paid each quarter in advance and are paid based on service for next quarter. We also grant our non-employee directors annual equity awards in the form of restricted stock units. These awards vest on the first anniversary of the grant date. The grant date of the 2024 equity awards was March 29, 2024, and these awards will vest on March 29, 2025. The following table sets forth the compensation paid to each of our non-employee directors in 2024:

  18. Compensation of Directors for Fiscal Year 2024

    | Name and Principal Position | Fees Earned or Paid in Cash1 | Stock Awards2 | Option Awards | All other Compensation | Total | | Isabella Cunningham3 | $73,125 | $60,000 | $— | $— | $133,125 | | Beverly O. Elving3 | 79,875 | 60,000 | — | — | 139,875 | | Kevin T. Hammond4 | 35,000 | 40,000 | — | — | 75,000 | | Paul A. Larkins4 | 35,000 | 40,000 | — | — | 75,000 | | David W. Levy3 | 83,250 | 60,000 | — | — | 143,250 | | Diane L. Merdian3 | 85,000 | 60,000 | — | — | 145,000 | | John S. Fleshood5 | — | — | — | — | — | | 1 None of our directors have elected to defer compensation. | | | | | | | 2 The amounts represent the grant date fair value for equity awards in accordance with ASC 718 — “Compensation-Stock Compensation.” A discussion of the assumptions used in calculating the values may be found in Note 1 of our audited financial statements included in our 2024 Annual Report on Form 10-K. | | | | | | | 3 Total unvested restricted stock units held by such director at December 31, 2024 was 1,677, which includes the restricted awards granted in 2024 for Company and Bank board service. | | | | | | | 4 Total unvested restricted stock units held by such director at December 31, 2024 was 1,118, which includes the restricted awards granted in 2024 for Company board service. | | | | | | | 5 Mr. Fleshood joined the Company and Bank boards on March 5, 2025; he did not receive director compensation in 2024. | | | | | |