DEF 14A of Finwise Bancorp
Filed Apr 29, 2024 · FY20230001856365-24-000023
PROPOSAL 1: ELECTION OF DIRECTORS
PROPOSAL 1: ELECTION OF DIRECTORS
Classification of the Company’s Directors
Classification of the Company’s Directors The Company’s Board has established the current size of the Board at eight (8) members. The Board is divided into three classes of directors serving staggered three-year terms. One class of directors is elected by our shareholders at each annual shareholders’ meeting for a term of three years, and the elected directors hold office until their successors are elected and qualified or until such director’s earlier death, resignation or removal. •The Class I directors are Jeana Hutchings, Alan Weichselbaum, and James N. Giordano, and their terms will expire at the 2024 Annual Meeting; •The Class II directors are Kent Landvatter, Howard I. Reynolds and Thomas E. Gibson, Jr., and their terms will expire at the 2025 Annual Meeting. •The Class III directors are Lisa Ann Nievaard and Gerald E. Cunningham, and their terms will expire at the 2026 Annual Meeting;
Election Procedures; Term of Office
Election Procedures; Term of Office At each annual meeting of shareholders, or special meeting in lieu thereof, upon the expiration of the term of a class of directors, the successors to such directors will be elected to serve from the time of election and qualification until the third annual meeting following his or her election and the election and qualification of his or her successor. Any change in the Board resulting from an increase or decrease in the number of directors will be distributed by the Board among the three classes so that, as nearly as possible, each class will consist of one-third of the directors.
Nominees for Election as Directors
Nominees for Election as Directors Our Board has approved the nomination of Jeana Hutchings, Alan Weichselbaum, and James N. Giordano for re-election as Class I directors. Information about the principal occupations, business experience and qualifications of these nominees is provided below under the heading “Qualifications of 2024 Director Nominees and Continuing Directors.”
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS Class I Director Nominees:
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Jeana Hutchings | Ms. Hutchings was appointed to our Board of Directors in October 2020. Ms. Hutchings began her career as a registered nurse, working in hospitals as well as certain other areas of healthcare industry, including insurance company operations and sales. She started at Diversified Insurance Group in 2003 and became a partner in 2006, successfully growing the employee benefits division from $1.5 million to a $9.5 million benefits practice today. She specializes in alternative financing strategies for businesses trying to manage increasing healthcare costs. Ms. Hutchings received her degree in nursing from the University of Utah. As a result of these and other professional experiences, we believe Ms. Hutchings possesses knowledge and experience regarding finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 59 | | | Director Since: 2020 | | | Committees: | | | Audit (Chair); Compensation | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Alan Weichselbaum | Mr. Weichselbaum was appointed to our Board of Directors in May 2015. He served on the board until May 2021. Mr. Weichselbaum was reappointed to our Board of Directors in October 2022. Mr. Weichselbaum began his career at Price Waterhouse where he became a Certified Public Accountant before moving to Wall Street as a sell-side analyst and hedge fund manager. In 2010, Mr. Weichselbaum started a consulting firm called The Wexus Group that provides financial consulting services to small to midsize businesses. He is currently serving as CEO and Founder of The Wexus Group. Mr. Weichselbaum received his Masters in Business Administration from the New York University in 1999. As a result of these and other professional experiences, we believe Mr. Weichselbaum possesses knowledge and experience regarding banking, finance and general business that strengthen our board of directors’ collective qualifications, skills and experience. | | Age: 60 | | | Director Since: 2015 | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| James N. Giordano | Mr. Giordano was appointed to our Board of Directors in June 2017. He started his career on Wall Street where he had worked for 17 years in both institutional and retail trading and sales. He led the team that was responsible for pricing and selling, and later trading in over 100 initial public offering transactions. He is one of the pioneers in the litigation finance industry and a founder of American Legal Finance Association. Mr. Giordano currently serves as the Chief Executive Officer of Cambridge Medical Funding Group LLC and Care Cap Plus LLC, a financial technology company that has developed innovative models in the medical finance payment industry and has been involved in medical finance for over 15 years. Mr. Giordano received Bachelor of Arts in Biology from Harvard College. As a result of these and other professional experiences, we believe Mr. Giordano possesses knowledge and experience regarding banking, finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 66 | | | Director Since: 2017 | | | Committees: | | | Nominating & Corporate Governance; Compensation (Chair) | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
Continuing Class II Directors:
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Thomas E. Gibson, Jr. | Mr. Gibson was appointed to our Board of Directors in May 2015. He has 22 years of military service and specialized in shipboard and shore logistics and finance. He joined the Utah Department of Financial Institutions in 1998 as a Bank and Credit Union Examiner. Mr. Gibson completed 34 National Credit Union Administration (NCUA), National Association of State Credit Union Supervisors (NASCUS), Federal Deposit Insurance Corporation (FDIC), Federal Reserve Bank (FRB), and Conference of State Bank Supervisors (CSBS) professional examination schools in Compliance, Asset Liability Management, Investments, Credit Evaluation, Residential Mortgage Lending, Problem Banks, and Bank Secrecy Act/Anti-Money Laundering (BSA/AML) from 1998 to 2012. He was the resident co-examiner-in-charge for UBS Industrial Bank, Salt Lake City, Utah from 2008 to 2011. Mr. Gibson retired from the Utah Department of Financial Institutions in 2012 as a Senior Examiner. Mr. Gibson received his bachelor’s degree in Education from the University of Central Oklahoma and his Master’s Degree in National Security and Strategic Studies from the Naval War College. As a result of these and other professional experiences, we believe Mr. Gibson possesses knowledge and experience regarding banking, finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 74 | | | Director Since: 2015 | | | Committees: | | | Nominating & Corporate Governance | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Howard I. Reynolds | Mr. Reynolds was one of the founding investors of the Bank in 1999. He served as the Chairman of the Bank’s Board of Directors for the first 10 years and of the Company since its inception in 2003. He currently serves as the Vice Chairman. Mr. Reynolds has extensive experience working with multiple companies negotiating long term contracts, including serving from 1990 to 2017 as the Chief Operating Officer of Pride Transport Inc., a common carrier of temperature controlled commodities. In September 2020, he became a founding investor of Element Solar Energy. As a result of these and other professional experiences, we believe Mr. Reynolds possesses knowledge and experience regarding banking, finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 67 | | | Director Since: 2002 | | | Committees: | | | Audit; Compensation; Nominating & Corporate Governance (Chair) | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Kent Landvatter | Mr. Landvatter joined the Company and the Bank in September 2010 as the President and Chief Executive Officer and serves as the Chairman of the board of directors of the Company, a position he has held since October 2022. Mr. Landvatter has over 40 years of financial services and banking experience, including experience with distressed banks and serving as the president of two de novo banks, Comenity Capital Bank and Goldman Sachs Bank, USA. Mr. Landvatter received his Bachelor of Science and his Master of Business Administration from University of Utah. As a result of these and other professional experiences, we believe Mr. Landvatter possesses knowledge and experience regarding banking, finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 69 | | | Director Since: 2010 | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
Continuing Class III Directors:
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Gerald E. Cunningham | Mr. Cunningham was one of the founding investors of the Bank in 1999. He has served as a director on the Bank’s Board of Directors since its inception in 1999 and on the Company’s Board of Directors since its inception in 2003. Mr. Cunningham has a background in business management, credit, finance and commercial and residential real estate construction. He owned Stonewood Inc., a commercial and residential construction firm from 1995 to 2020. He joined Goldcrest Homes as their Purchasing Manager in October 2020. As a result of these and other professional experiences, we believe Mr. Cunningham possesses knowledge and experience regarding banking, finance and general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 66 | | | Director Since: 2002 | | | Committees: | | | Audit | |
QUALIFICATIONS OF 2024 DIRECTOR NOMINEES AND CONTINUING DIRECTORS
| Lisa Ann Nievaard | Ms. Nievaard was appointed to our Board of Directors in July 2020. Ms. Nievaard has over 20 years of experience in strategic marketplace planning, operations management and brand development. Ms. Nievaard started with Coca-Cola in 2001 and served most recently as the general manager of franchise leadership at Coca-Cola North America, where she collaborated with multiple bottling partners to develop and to execute long-term sustainable growth plans to increase franchise value and shareholder value. Ms. Nievaard retired from Coca-Cola in 2023. Prior to joining Coca-Cola, Ms. Nievaard worked in brand strategy and media management. Ms. Nievaard received her degree in Marketing and Business Management from Brigham Young University. As a result of these and other professional experiences, we believe Ms. Nievaard possesses knowledge and experience regarding general business that strengthen our Board of Directors’ collective qualifications, skills and experience. | | Age: 55 | | | Director Since: 2020 | | | Committees: | | | Compensation; Nominating & Corporate Governance | |
COMPENSATION OF NON-EMPLOYEE DIRECTORS
COMPENSATION OF NON-EMPLOYEE DIRECTORS The following table sets forth compensation paid or awarded to, or earned by, each of our directors (except for Mr. Landvatter, whose compensation is disclosed under “Summary Compensation Table” below) during 2023.
COMPENSATION OF NON-EMPLOYEE DIRECTORS
| Name | Retainer Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | All Other Compensation ($) | Total ($) | | Howard I. Reynolds | 72,600 | 41,450 | — | 114,050 | | Gerald E. Cunningham | 60,600 | 41,450 | — | 102,050 | | James N. Giordano | 60,600 | 41,450 | — | 102,050 | | Thomas E. Gibson, Jr. | 60,600 | 41,450 | — | 102,050 | | Lisa Ann Nievaard | 60,600 | 41,450 | — | 102,050 | | Jeana Hutchings | 60,600 | 41,450 | — | 102,050 | | Alan Weichselbaum | 60,600 | 41,450 | — | 102,050 |
COMPENSATION OF NON-EMPLOYEE DIRECTORS
| (1) Represents the grant date fair value of restricted stock awards calculated in accordance with Financial Accounting Standards Board Account Standards Codification Topic 718 (“FASB ASC Topic 718”). The amounts reported may not reflect the actual economic value realized by each director. The total grant date fair market value of the restricted stock awarded to directors was approximately $0.3 million for the year ended December 31, 2023. |
COMPENSATION OF NON-EMPLOYEE DIRECTORS
During 2023, the Company utilized a non-employee directors’ compensation program that included a balance of annual retainers for attending meetings of the Board and its committees. Pursuant to this program, approximately 40% of the compensation payable to a non-employee director is expected be paid in the form of shares of our common stock. For the year ended December 31, 2023, the directors of the Company, other than Mr. Landvatter, received annual retainer fees as follows: Board-Related Fees
COMPENSATION OF NON-EMPLOYEE DIRECTORS
| | Cash Compensation | | | | | Retainer ($) | | | | Director Role | Monthly | Annual | Total Cash ($) | | Normal Outside Director | 5,050 | 60,600 | 60,600 | | Lead Independent Director | 6,050 | 72,600 | 72,600 |
Summary Compensation Table
Summary Compensation Table The following table presents summary information regarding the total compensation awarded to, earned by and paid to our named executive officers for the years ended December 31, 2023 and 2022.
Summary Compensation Table
| Name and Principal Position | | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1)(2) | Option Awards ($)(3)(4) | All Other Compensation ($)(5) | Total ($) | | Kent Landvatter | | 2023 | 558,462 | 253,578 | 483,280 | 118,735 | 31,580 | 1,445,635 | | | Chief Executive Officer and President of the Company and Chief Executive Officer of the Bank | 2022 | 549,432 | 376,006 | 560,003 | 139,998 | 25,244 | 1,650,683 | | James F. Noone | | 2023 | 442,500 | 428,980 | 207,120 | 50,886 | 18,027 | 1,147,513 | | | President of the Bank | 2022 | 360,609 | 1,006,480 | 167,994 | 42,002 | 16,710 | 1,593,795 | | Javvis Jacobson | | 2023 | 324,923 | 95,854 | 186,408 | 45,798 | 24,237 | 677,220 | | | Chief Financial Officer of the Company and the Bank | 2022 | 322,146 | 153,375 | 215,995 | 54,002 | 20,740 | 766,258 |
Summary Compensation Table
| (1) The stock awards granted in 2023 vest over the first three anniversaries of the grant date of April 18, 2023 based on achievement of specified levels of the Bank’s return on average assets.. The 2023 amounts represent the aggregate grant date fair value of stock awards granted in that year, calculated in accordance with FASB ASC Topic 718. The grant date fair value of the stock award was $8.63 per share. | | (2) The stock awards granted in 2022 vest over the first three anniversaries of the grant date of June 9, 2022 based on achievement of specified levels of the Bank’s return on average assets.. The 2022 amounts represent the aggregate grant date fair value of stock awards granted in that year, calculated in accordance with FASB ASC Topic 718. The grant date fair value of the stock award was $13.04 per share. | | (3) The option awards granted in 2023 vest over the first three anniversaries of the grant date of April 18, 2023 based on achievement of specified levels of the Bank’s return on average assets. The 2023 amounts represent the aggregate grant date fair value of options granted in that year, calculated in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are discussed in the Summary of Significant Accounting Policies note and the Stock-Based Compensation note to our consolidated financial statements as of December 31, 2023 in our Annual Report on Form 10-K. The resulting grant date fair value of the stock options was $4.11 per share. | | (4) The option awards granted in 2022 vest over the first three anniversaries of the grant date of June 9, 2022 based on achievement of specified levels of the Bank’s return on average assets. The 2022 amounts represent the aggregate grant date fair value of options granted in that year, calculated in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are discussed in the Summary of Significant Accounting Policies note and the Stock-Based Compensation note to our consolidated financial statements as of December 31, 2022 in our Annual Report on Form 10-K. The resulting grant date fair value of the stock options was $6.26 per share. | | (5) “All Other Compensation” for the named executive officers is further described below. |
Outstanding Equity Awards at December 31, 2023
Outstanding Equity Awards at December 31, 2023 The following table sets forth, on an award by award basis, information concerning option awards held by the named executive officers at December 31, 2023.
Outstanding Equity Awards at December 31, 2023
| | Option Awards | | | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Earned Options (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | | Kent Landvatter | 12/24/2019(1) | 40,914 | — | — | 3.64 | 12/24/2029 | | Kent Landvatter | 12/23/2019(2) | 137,400 | — | — | 3.64 | 12/23/2029 | | Kent Landvatter | 6/9/2022(5) | — | 7,451 | 14,901 | 13.04 | 6/9/2032 | | Kent Landvatter | 4/18/2023(5) | — | — | 28,866 | 8.63 | 4/18/2033 | | Javvis Jacobson | 12/24/2019(2) | 74,000 | — | — | 3.64 | 12/24/2029 | | Javvis Jacobson | 1/1/2021(4) | 60,000 | — | — | 4.50 | 1/1/2031 | | Javvis Jacobson | 6/9/2022(5) | — | 2,874 | 5,748 | 13.04 | 6/9/2032 | | Javvis Jacobson | 4/18/2023(5) | — | — | 11,134 | 8.63 | 4/18/2033 | | James F. Noone | 12/24/2019(3) | 45,774 | — | — | 3.64 | 12/24/2029 | | James F. Noone | 1/1/2021(4) | 60,000 | — | — | 4.50 | 1/1/2031 | | James F. Noone | 6/9/2022(5) | — | 2,235 | 4,471 | 13.04 | 6/9/2032 | | James F. Noone | 4/18/2023(5) | — | — | 24,000 | 8.63 | 4/18/2033 |
Outstanding Equity Awards at December 31, 2023
| (1) The stock options vested 20% immediately then ratably on a monthly basis over the next forty-eight months from the grant date. | | (2) Stock option award granted pursuant to the 2019 Plan. The stock options vested 20% immediately then ratably on a monthly basis over the next forty-eight months from the grant date. | | (3) Stock option award granted pursuant to the 2019 Plan. The stock options vest 20% immediately then ratably on a monthly basis over the next thirty-eight months from the grant date. | | (4) The stock options vested immediately upon grant. | | (5) Stock Option award granted pursuant to the 2019 Plan. The stock options vest based on achievement of specified levels of the Bank’s return on average assets. |
Outstanding Equity Awards at December 31, 2023
The following table sets forth, on an award by award basis, information concerning unvested restricted stock awards held by the named executive officers at December 31, 2023.
Outstanding Equity Awards at December 31, 2023
| | Stock Awards | | | | | | Name | Grant Date | Number of Shares of Stock That Have Not Vested (#) | Market Value of Shares of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares That Have Not Vested(1) (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares That Have Not Vested(2) ($) | | Kent Landvatter | 6/9/2022 | — | — | 28,630 | 409,695 | | Kent Landvatter | 4/18/2023 | — | — | 56,000 | 801,360 | | James F. Noone | 6/9/2022 | — | — | 8,589 | 122,909 | | James F. Noone | 4/18/2023 | — | — | 24,000 | 343,440 | | Javvis Jacobson | 6/9/2022 | — | — | 11,043 | 158,025 | | Javvis Jacobson | 4/18/2023 | — | — | 21,600 | 309,096 |
Outstanding Equity Awards at December 31, 2023
| (1) Restricted stock award granted pursuant to the 2019 Plan. The stock vests ratably on each of the first three anniversaries of the grant date based on achievement of specified levels of the Bank’s return on average assets. | | (2) The market value for our common stock is based on the closing price of our common stock on December 31, 2023 as reported by the NASDAQ Stock Market LLC. |