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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐
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Preliminary Proxy Statement |
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| Definitive Proxy Statement |
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Broadway Financial Corporation |
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BROADWAY FINANCIAL CORPORATION
5055 Wilshire Boulevard, Suite 500
Los Angeles, California 90036
May 17, 2019
September 9, 2021
On behalf of the Board of Directors, I cordially invite you to attend the Annual Meeting of Stockholders of Broadway Financial Corporation (the
"Company"“Company”), which will be held at
the Company's principal executive offices, 5055 Wilshire Boulevard, Suite 500, Los Angeles, California 90036, at 2:9:00
p.m.a.m. (PDT) on Wednesday,
June 26, 2019 .October 20, 2021. Due to the public health concerns arising from the COVID 19 pandemic, and also to realize the cost and other benefits of the latest technology, our Annual Meeting will be a virtual meeting conducted solely as a live webcast through the Internet. There will not be any physical meeting location. You will be able to participate in the Annual Meeting, and to vote your shares and submit questions electronically before or during the Annual Meeting by visiting https://meetnow.global/MDUG99J and entering your Control Number that will be included in the instructions that will be sent to you for voting and participating in the Annual Meeting.
Stockholders will be asked at the Annual Meeting to vote on the election of three directors and on each of the other proposals described in the accompanying Notice of Annual Meeting of Stockholders and Proxy Statement.
Your vote is very important, regardless of the number of shares you own. Whether or not you expect to
attendparticipate in the Annual Meeting, please
send us your electronic voting instructions for your shares, or complete, sign,
date, and
datemail each proxy card you receive
and return itif you prefer to
the Companyvote by proxy card, as soon as
possible in the postage-paid envelopes that have been provided.possible. You may revoke your
electronic voting instructions or proxies at any time prior to the
Annual Meeting and, if you attendcompletion of voting at the Annual
Meeting, you may vote your shares in person.Meeting.
Sincerely,
Wayne-Kent A. Bradshaw
Brian E. Argrett
President and Chief Executive Officer
IMPORTANT: If your Broadway Financial Corporation shares are held in the name of a brokerage firm or other nominee, only that brokerage firm or nominee may
submit electronic voting instructions or execute a proxy on your behalf. To ensure that your shares are voted, we urge you to telephone the individual responsible for your account today and obtain instructions on how to direct him or her to
submit electronic voting instructions, execute a proxy on your
behalf.behalf, or provide a legal proxy for you to vote your shares.
If you have any questions or need any assistance in voting your shares, please telephone Alice Wong,Audrey A. Phillips, the Company'sCompany’s Corporate Secretary, at (323) 634-1700, Ext 3269.(202) 243-7141.
THIS PROXY STATEMENT AND THE COMPANY’S ANNUAL REPORT TO STOCKHOLDERS
ARE AVAILABLE AThttp://www.edocumentview.com/BYFC
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BROADWAY FINANCIAL CORPORATION
5055 Wilshire Boulevard, Suite 500
Los Angeles, California 90036
Notice of Annual Meeting of Stockholders
Wednesday, June 26, 2019October 20, 2021
2:
9:00
p.m.Dear Stockholder:
a.m. (PDT)
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Broadway Financial Corporation (the
"Company"“Company”) will be held at
the Company's principal executive offices, 5055 Wilshire Boulevard, Suite 500, Los Angeles, California 90036, at 2:9:00
p.m.a.m. (PDT) on Wednesday,
June 26, 2019,October 20, 2021, as a virtual meeting conducted through the Internet, for the following purposes:
1.To elect three directors of the Company to serve until the Annual Meeting of Stockholders to be held in the year 2022 or until their successors are elected and have been qualified;
2.To ratify the appointment of Moss Adams LLP as the independent registered public accounting firm for the Company for its fiscal year ending December 31, 2019;
3.To cast an advisory (non-binding) vote on executive compensation; and
4.To consider such other business as may properly come before and be voted upon by the stockholders at the Annual Meeting of Stockholders or any postponement or adjournment thereof.
1.
| To elect the three directors named in the proxy statement to serve until the Annual Meeting of Stockholders to be held in the year 2024 or until their successors are elected and have been qualified; |
2.
| To ratify the appointment of Moss Adams LLP as the independent registered public accounting firm for the Company for its fiscal year ending December 31, 2021; |
3.
| To cast an advisory (non-binding) vote on executive compensation; |
4.
| To consider such other business as may properly come before and be voted upon by the stockholders at the Annual Meeting, or any postponement or adjournment thereof, pursuant to the bylaws of the Company. |
The Board of Directors has selected
May 3, 2019August 25, 2021 as the
record dateRecord Date for the Annual Meeting. Only those stockholders of record at the close of business on that date will be entitled to a notice of and to vote at the Annual Meeting or any postponement or adjournment thereof. A list of stockholders entitled to vote at the Annual Meeting will be available at the
Company'sCompany’s principal executive offices during the ten days prior to the Annual Meeting and will also be available for inspection
aton-line during the Annual Meeting.
Whether or not you expect to attend the Annual Meeting, please
submit your electronic voting instructions, or mail your proxy in the postage-paid envelope that
has been provided.is provided to you, as soon as possible. You may revoke
thisyour electronic voting instructions or proxy at any time prior to the
Annual Meeting and, if you attendcompletion of voting at the Annual
Meeting, you may vote your shares in person.Meeting.
By Order of the Board of Directors
Alice Wong
VPAudrey A. Phillips
Vice President and Corporate Secretary
Los Angeles, California
May 17, 2019
Table
Important Notice Regarding the Availability of
Contents
Proxy Materials for the Shareholder Meeting To Be Held on Wednesday, October 20, 2021. This proxy statement and the company’s annual report to stockholders are available at www.edocumentview.com/BYFC.
September 9, 2021
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Instructions and Frequently Asked Questions for Annual Meeting
This year’s Annual Meeting will be conducted solely online via live webcast. You will be able to attend and participate in the Annual Meeting online, vote your shares electronically and submit your questions prior to and during the meeting by visiting: https://meetnow.global/MDUG99J at the meeting date and time described in the accompanying proxy statement.
We are excited to embrace the latest technology for our Annual Meeting to provide expanded access, improved communication and cost savings for our stockholders and the Company. We believe that hosting a virtual meeting will enable greater stockholder attendance and participation by eliminating the necessity of travel to the Annual Meeting.
Q:
| How can I attend the Annual Meeting? |
A:
| The Annual Meeting will be conducted solely online by live webcast. No physical meeting will be held. You will be entitled to participate in the Annual Meeting, including asking questions and voting your shares, only if you were a stockholder of the Company of record as of the close of business on the Record Date for the Annual Meeting, or if you hold a valid proxy for the Annual Meeting received from a stockholder of record on that date and follow the instructions below. |
To participate in the Annual Meeting, you will need to review the information included in the Stockholder Meeting Notice that was sent separately to you (the “Notice”), on your proxy card, or on the instructions that accompanied your proxy materials.
If you hold your shares through an intermediary, such as a bank or broker, you must register in advance using the registration instructions below.
The Annual Meeting will begin promptly at 9:00 a.m., Pacific Time. We encourage you to access the meeting website prior to the start time, leaving ample time for the meeting check-in procedure. Please note that if you are not a stockholder of record you must first have followed the registration instructions below or in the accompanying proxy statement. Each shareholder may appoint only one proxy holder or representative to attend the meeting on his or her behalf.
Q:
| Who may vote at the Annual Meeting? |
A:
| The Board of Directors has selected August 25, 2021 as the Record Date for the Annual Meeting. Only those stockholders of record at the close of business on that date will be entitled to a notice of and to vote at the Annual Meeting or any postponement or adjournment thereof. |
Q:
| What is the difference between holding shares as a “stockholder of record” and as a beneficial owner of shares held in “street name”? |
A:
| If your shares are registered directly in your name with our transfer agent, Computershare Trust Company, N.A. (“Computershare”), you are considered the “stockholder of record” with respect to those shares, and the Notice was sent directly to you. |
If your shares are held in an account at a brokerage firm, bank, broker-dealer, or other similar organization, then you are the beneficial owner of shares held in “street name,” and the Notice or separate voting instructions were forwarded to you by that organization. As a beneficial owner, you have the right to direct that organization how to vote the shares held in your account but you do not have legal authority to vote the shares directly unless you receive a legal authorization or “proxy” to vote the shares from the organization. You should follow the instructions in the Notice or voting instructions provided to you by that organization in order to vote your shares or direct the organization on how to vote your shares.
Q:
| How do I register to attend the Annual Meeting? |
A:
| If you are a stockholder of record, our transfer agent, Computershare, will already have that information and you will not need to register to attend and participate in the Annual Meeting webcast. Instead, you may simply follow the instructions to access the meeting website on the Notice or proxy card that you received. |
If your shares are held in “street name”, you must register in advance to attend the Annual Meeting virtually on the Internet. To do this, you must submit proof of your proxy authority (which is referred to herein as a “legal proxy”) reflecting the Company shares you hold, along with your name and email address to Computershare as further described below. Requests for registration must be labeled as “Legal Proxy” and must be received no later than 5:00 p.m., Eastern Time, on October 18, 2021.
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You will receive a confirmation of your registration by email after we receive your registration materials.
Requests for registration to participate in the Annual Meeting should be directed to us at the following address:
If sent by email:
Forward the email you received from your broker or other street name holder to vote your shares, or attach an image of your legal proxy, to legalproxy@computershare.com
If sent by regular mail:
Computershare
Broadway Financial Corporation Legal Proxy
P.O. Box 43001
Providence, RI 02940
Q:
| How can I vote my shares without participating in the online Annual Meeting? |
A:
| Whether you are a stockholder of record or hold your shares in street name, you may vote your shares or direct how your shares will be voted without participating in the online Annual Meeting. |
If you are a stockholder of record, you may vote your shares over the Internet or by telephone by following the instructions on the Notice you received. If you request printed copies of the proxy materials by mail, you may also vote by signing and submitting your proxy card and returning it by mail in the postage-paid envelope that will be provided to you. You should sign your name exactly as it appears on the proxy card. If you are signing in a representative capacity (for example, as guardian, executor, trustee, custodian, attorney or officer of a corporation), you should indicate your name and title or capacity.
If you are the beneficial owner of shares held in street name, you may be eligible to vote your shares electronically over the Internet or by telephone by following the instructions on the Notice you received. If you request printed copies of the proxy materials by mail, you may also vote by signing the voter instruction form provided by your broker or other street name holder and returning it by mail. If you provide specific directions on how to vote by mail, telephone or over the Internet, your shares will be voted by your broker or other street name holder as you have directed.
The persons named as proxies are executive officers of the Company. All proxies properly submitted in time to be counted at the Annual Meeting will be voted in accordance with the directions contained therein. If you submit your proxy without directing how your shares are to be voted, your shares will be voted by the proxy holders in accordance with the recommendations of the Board of Directors included in the accompanying proxy statement.
Q:
| How can I vote my shares during the Annual Meeting? |
A:
| Whether you are a stockholder of record or hold your shares in street name, you may vote online at the Annual Meeting. You will need to enter your control number (included in your Notice, your proxy card, or the voting instructions that accompanied your proxy materials) to vote your shares at the Annual Meeting. Even if you plan to participate in the Annual Meeting, however, we encourage you to vote over the Internet, by telephone, or by returning a proxy card if you have requested printed proxy materials. This will ensure that your vote will be counted if you are unable to, or later decide not to, participate in the Annual Meeting. |
Q:
| May I revoke my voting instructions or proxy and change my vote? |
A:
| You may revoke your proxy and change your vote on a matter at any time before the voting on the matter at the Annual Meeting is completed. You may revoke your voting instructions or proxy over the Internet or by telephone by following the instructions included in your proxy materials or by submitting a written notice of revocation to Broadway Financial Corporation 5055 Wilshire Blvd., Suite 500, Los Angeles, CA 90036, Attn: Audrey A. Phillips. You may also revoke a previously submitted proxy by voting again on a later date over the Internet, by telephone, or by signing and returning a new proxy card by mail (only your latest proxy submitted prior to the Annual Meeting will be counted), or by voting at the Annual Meeting. Your participation at the Annual Meeting will not revoke your proxy unless you vote again electronically during the Annual Meeting. Any revocation of or change in your vote on a matter must be received by the Company prior to completion of the vote on the matter to be effective. |
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Broadway Financial Corporation
Proxy Statement
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BROADWAY FINANCIAL CORPORATION
5055 Wilshire Boulevard Suite 500
Los Angeles, California 90036
PROXY STATEMENT
Annual Meeting of Stockholders
Wednesday,
June 26, 2019
October 20, 2021
This Proxy Statement is furnished in connection with the solicitation of
electronic voting instructions and proxies by the Board of Directors (the
"Board"“Board”) of Broadway Financial Corporation
a Delaware corporation (the
"Company"“Company”), for use at the Annual Meeting of Stockholders of the Company (the
"Annual Meeting"“Annual Meeting”)
tothat will be held at
the Company's principal executive offices, 5055 Wilshire Boulevard, Suite 500, Los Angeles, California, 90036, at 2:9:00
p.m.a.m. (PDT) on Wednesday,
June 26, 2019,October 20, 2021 as a virtual meeting conducted through the Internet, and at any postponement or adjournment thereof. This Proxy Statement and the accompanying form of proxy were first
mailedmade available to stockholders on
the Internet on or about
May 17, 2019.September 9, 2021. If you would like to receive a paper copy of our proxy materials, please follow the instructions included in the Notice of Annual Meeting of Stockholders sent by the Company to all stockholders of record as of the Record Date (described below) for the Annual Meeting, or contact Audrey A. Phillips, Vice President and Corporate Secretary, at (202) 243-7141.
The Company was incorporated under Delaware law in September 1995 for the purpose of acquiring and holding all of the outstanding capital stock of Broadway Federal Bank, f.s.b.
("(“Broadway
Federal" or the "Bank"Federal”) as part of
the Bank'sBroadway Federal’s conversion from a federally chartered mutual savings and loan association to a federally chartered stock savings bank (the
"Conversion"“Conversion”). The Conversion was completed, and
the BankBroadway Federal became a wholly owned subsidiary of the Company on January 8, 1996.
On April 1, 2021, the Company completed its merger (the “Merger”) with CFBanc Corporation (“CFBanc”), with the Company continuing as the surviving entity. Immediately following the Merger, Broadway Federal merged with and into City First Bank of D.C, National Association with City First Bank of D.C., National Association (the “Bank”, or “City First”, which concurrently changed its name to City First Bank, National Association) continuing as the surviving entity and a wholly-owned subsidiary of the Company. Throughout this Proxy Statement, the terms
"we"“we”,
"us"“us”,
"our"“our” and the
"Company"“Company” refer to Broadway Financial Corporation and, unless otherwise indicated, such references include the
Bank asBank. Prior to the
Company's predecessor.Merger, no bank holding company or other person controlled the Company. In the Merger, City First Enterprises, Inc. (“City First Enterprises”), the bank holding company that formerly controlled CFBanc, received 6,662,236 shares of our Class A voting common stock, par value $0.01 per share (the “Voting Common Stock”), representing approximately 15.2% of our Voting Common Stock outstanding, in exchange for its shares of Class A Common Stock of CFBanc. City First Enterprises is now a controlling person of the Company.THIS PROXY STATEMENT AND THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS ARE
AVAILABLE AThttp://www.broadwayfederalbank.com
RECORD DATE AND VOTING OF SHARES
The Board has selected May 3, 2019August 25, 2021 as the record dateRecord Date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting. A total of 19,123,45543,674,046 shares of the Company's voting common stock, par value $0.01 per share (the "VotingCompany’s Voting Common Stock"),Stock were outstanding at the close of business on that date. A majority of the shares of Voting Common Stock entitled to vote, represented in person or by proxy, will constitute a quorum for the transaction of business at the Annual Meeting. Stockholders will be entitled to cast one vote for each share of Voting Common Stock held by them of record at the close of business on the record dateRecord Date on any matter that may be presented at the Annual Meeting for consideration and action by the stockholders and on which they are entitled to vote.
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Abstentions will be treated as shares of Voting Common Stock that are present and entitled to vote for purposes of determining the presence of a quorum, but as not voted for purposes of determining the approval of any matter submitted for a vote of the stockholders. If a broker indicates on its proxy that the broker does not have discretionary authority to vote on a particular matter as to certain shares of Voting Common Stock, commonly referred to as "broker non-votes"“broker non-votes”, then those shares will be counted for general quorum purposes but will not be considered as present and entitled to vote with respect to that matter.
A plurality of votes cast by the holders of shares of Voting Common Stock will be required for the election of directors.directors, and there is no cumulative voting. The affirmative vote of the majority of the shares of Voting Common
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The following table sets forth information as of
March 31, 2019September 1, 2021 concerning the shares of the
Company's Common StockCompany’s common stock owned by each person known to the Company to be a beneficial owner of more than 5% of the
Company'sCompany’s Voting Common Stock, each director
or director nominee, each Named Executive Officer, and all current directors and executive officers as a group.
| | | | | | | | | | | | | |
| Beneficial Owner | | Number of
Shares of
Voting
Common
Stock
Beneficially
Owned | | Percent
of Voting
Common
Stock | | Number of
Shares of
Non-Voting
Common
Stock
Beneficially
Owned(1) | | Percent of
Total
Common
Stock
Outstanding(2) | |
|---|
United States Department of the Treasury(3) | | | 2,695,002 | | | 14.09 | % | | - | | | 9.67 | % |
CJA Private Equity Financial Restructuring Master Fund I L.P.(4) | | |
1,845,141 | | |
9.654 |
% | |
6,453,995 | | |
29.77 |
% |
Hope Bancorp, Inc.(5) | | |
1,835,881 | | |
9.60 |
% | |
- | | |
6.58 |
% |
Broadway Federal Bank f.s.b. Employee Stock Ownership Plan(6) | | |
1,693,422 | | |
8.86 |
% | |
- | | |
6.07 |
% |
Grace & White, Inc.(7) | | |
1,603,457 | | |
8.38 |
% | |
- | | |
5.75 |
% |
National Community Investment Fund(8) | | |
896,160 | | |
4.69 |
% | |
1,564,540 | | |
8.83 |
% |
First Republic Bank(9) | | |
834,465 | | |
4.36 |
% | |
737,861 | | |
5.64 |
% |
Directors and Executive Officers(6) | | |
| | |
| | |
| | |
| |
Wayne-Kent A. Bradshaw(10) | | | 381,908 | | | 1.99 | % | | - | | | 1.37 | % |
Robert C. Davidson, Jr.(11)(12) | | | 83,104 | | | 0.43 | % | | - | | | 0.30 | % |
Daniel A. Medina(11)(13) | | | 65,460 | | | 0.34 | % | | - | | | 0.23 | % |
Virgil Roberts(11)(14) | | | 37,427 | | | 0.20 | % | | - | | | 0.13 | % |
Dutch C. Ross III | | | 23,461 | | | 0.12 | % | | - | | | 0.08 | % |
Erin Selleck(15) | | | 15,723 | | | 0.08 | % | | - | | | 0.06 | % |
Jack T. Thompson | | | 6,024 | | | 0.03 | % | | | | | 0.02 | % |
Brenda J. Battey(16) | | | 152,911 | | | 0.80 | % | | - | | | 0.55 | % |
Norman Bellefeuille(17) | | | 237,347 | | | 1.23 | % | | - | | | 0.85 | % |
Ruth McCloud(18) | | | 115,207 | | | 0.60 | % | | - | | | 0.41 | % |
All current directors and executive officers as a group (10 persons) | | | 1,118,572 | | | 5.74 | % | | - | | | 3.96 | % |
(1)The non-voting Except as otherwise indicated, and subject to any interests of the reporting person’s spouse, we believe that the beneficial owners of common stock may be converted to common stock only upon certain prescribed forms of sales to third parties that are not affiliated with the holders thereof.(2)Percentages arelisted below, based on the total ofinformation furnished by such owners, have sole voting and non-voting common stock held by the respective stockholders shown in the table.(3)The address for United States Department of the Treasury is 1500 Pennsylvania Avenue, NW, Room 2312, Washington, D.C. 20220. The Treasury Department sold all of these shares in two transactions that were completed on May 1, 2019 and that included the purchase of 1,846,154 of such shares by The Capital Corps, LLC, the address of which is 2030 Main Street, Suite 500, Irvine, CA 92614.
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(4)Christopher J. Acito, managing member of Christopher J. Acito ("CJA") & Associates LLC, has sole investment and voting power with respect to thesesuch shares. CJA & Associates LLC is the managing memberAs of CJA Private Equity Financial Restructuring GP I Ltd., which is the general partner of CJA Private Equity Financial Restructuring Master Fund I LP. The address for CJA & Associates LLC is 654 Madison Avenue, Suite 601, New York, NY 10065. CJA & Associates LLC is an affiliate of Gapstow Capital Partners located at 654 Madison Avenue, Suite 601, New York, NY 10065.(5)Includes holdings of Hope Bancorp, Inc. and its subsidiary Bank of Hope. The address for Hope Bancorp, Inc. is 3200 Wilshire Boulevard, Suite 1400, Los Angeles, CA 90010.(6)The address for each of the directors and named executive officers and the Broadway Federal Bank f.s.b. Employee Stock Ownership Plan ("ESOP") is 5055 Wilshire Boulevard, Suite 500, Los Angeles, CA 90036.(7)Information based upon Schedule 13G/A, filed on January 28, 2019 with the SEC by Grace & White, Inc., which is an investment adviser. The address for Grace & White, Inc. is 515 Madison Avenue, Suite 1700, New York, NY 10022.(8)The address for National Community Investment Fund ("NCIF") is 135 South LaSalle, Suite 2040, Chicago, IL 60603.(9)The address for First Republic Bank is 111 Pine Street, San Francisco, CA 94111.(10)Includes 34,042 allocated shares under the ESOP, 20,962September 1, 2021, we had 43,674,046 shares of restricted stock and 75,000 shares subject to options granted under the Company's 2008 Long Term Incentive Plan (the "LTIP"), which options are all currently exercisable as of March 31, 2019.(11)Includes 3,125 shares subject to options granted under the LTIP, which options are all currently exercisable as of March 31, 2019.(12)Includes 70,000 shares that are held by the Robert and Alice Davidson Trust, dated August 11, 1982. Robert Davidson and Alice Davidson share investment and voting power with respect to the shares held by the Robert and Alice Davidson Trust in their capacities as trustees of the trust.(13)Includes 48,068 shares that are held by the Martin Medina Family Trust. Mr. Medina and his wife share investment and voting power with respect to the shares held by the Martin Medina Family Trust in their capacities as trustees of the trust.(14)Includes 28,150 shares held jointly with his spouse with whom voting and investment power are shared.(15)Includes 2,262 shares held jointly with her spouse with whom voting and investment power are shared.(16)Includes 24,647 allocated shares under the ESOP, 38,264 shares of restricted stock, and 90,000 shares subject to options granted under the LTIP, which options are all currently exercisable as of March 31, 2019.(17)Includes 24,515 allocated shares under the ESOP, 40,332 shares of restricted stock, and 120,000 shares subject to options granted under the LTIP, which options are all currently exercisable as of March 31, 2019, and 52,500 shares held jointly with his spouse with whom voting and investment power are shared.(18)Includes 22,604 allocated shares under the ESOP, 32,603 shares of restricted stock and 60,000 shares subject to options granted under the LTIP, which options are all currently exercisable as of March 31, 2019.
Voting Common Stock outstanding.5% Beneficial Owners:
| | | | | | | | | | | | | | | |
City First Enterprises(4) | | | 6,622,236 | | | 15.16% | | | — | | | — | | | 9.23% |
Cedars-Sinai Medical Center(5) | | | 2,808,989 | | | 6.43% | | | — | | | — | | | 3.91% |
| | | | | | | | | | | | | | | |
Directors and Executive Officers(6):
| | | | | | | | | | | | | | | |
Wayne-Kent A. Bradshaw(7) | | | 269,902 | | | * | | | — | | | — | | | * |
Robert C. Davidson(8) | | | 88,590 | | | * | | | — | | | — | | | * |
Brian E. Argrett | | | 44,524 | | | * | | | — | | | — | | | * |
Dutch C. Ross III | | | 32,072 | | | * | | | — | | | — | | | * |
Jack T. Thompson | | | 14,635 | | | * | | | — | | | — | | | * |
Mary Ann Donovan | | | 1,362 | | | * | | | — | | | — | | | * |
Marie C. Johns | | | 1,362 | | | * | | | — | | | — | | | * |
William A. Longbrake | | | 1,362 | | | * | | | — | | | — | | | * |
David J. McGrady | | | 1,362 | | | * | | | — | | | — | | | * |
Norman Bellefeuille(9) | | | 316,470 | | | * | | | — | | | — | | | * |
Brenda J. Battey(10) | | | 212,175 | | | * | | | — | | | — | | | * |
Ruth McCloud(11) | | | 154,742 | | | * | | | — | | | — | | | * |
Tom Nida | | | 2,500 | | | * | | | — | | | — | | | * |
Shannon Herbert | | | — | | | * | | | — | | | — | | | * |
Sonja Wells | | | — | | | * | | | — | | | — | | | * |
All current directors and executive officers as a group (15 persons)(12) | | | 1,141,058 | | | 2.61% | | | — | | | — | | | 1.59% |
(1)
| The Class B non-voting common stock may not be converted to Voting Common Stock. |
(2)
| The Class C non-voting common stock may be converted to Voting Common Stock only upon the occurrence of certain prescribed forms of sales to third parties that are not affiliated with the holders thereof. |
(3)
| The total number of outstanding common shares as of September 1, 2021 was 71,768,442, which includes all outstanding shares of Voting Common Stock, Class B non-voting, and Class C non-voting common stock. . |
(4)
| The address for City First Enterprises is 1 Thomas Circle, NW, Suite 700, Washington, D.C. 20005. |
(5)
| The address for Cedars-Sinai Medical Center is 8700 Beverly Boulevard, TRES 6500, Los Angeles, CA 90048. |
(6)
| The address for each of the directors and named executive officers is 5055 Wilshire Boulevard, Suite 500, Los Angeles, CA 90036. |
(7)
| Includes 41,630 allocated shares under the Broadway Federal Bank f.s.b. Employee Stock Ownership Plan (“ESOP”). |
(8)
| Includes 70,000 shares that are held by the Robert and Alice Davidson Trust, dated August 11, 1982. Robert Davidson and Alice Davidson share investment and voting power with respect to the shares held by the Robert and Alice Davidson Trust in their capacities as trustees of the trust. |
(9)
| Includes 29,013 allocated shares under the ESOP and 200,000 shares subject to options granted under the LTIP, which options are all currently exercisable, and 52,500 shares held jointly with his spouse with whom voting and investment power are shared. |
(10)
| Includes 29,037 allocated shares under the ESOP and 150,000 shares subject to options granted under the LTIP, which options are all currently exercisable. |
(11)
| Includes 26,516 allocated shares under the ESOP and 100,000 shares subject to options granted under the LTIP, which options are all currently exercisable. |
(12)
| Includes 450,000 options to purchase Voting Common Stock, all of which are currently exercisable. |
Table of ContentsTABLE OF CONTENTS
The following Audit Committee Report does not constitute soliciting material and shall not be deemed filed or incorporated by reference into any other filings by the Company under the Securities Act of 1933, as amended, or under the Exchange Act, except to the extent we specifically incorporate this Report by reference.
The Audit Committee oversees the
Company'sCompany’s financial reporting process on behalf of the Board. Management has the primary responsibility for the consolidated financial statements and the reporting process, including the
Company'sCompany’s systems of internal controls. The
Company'sCompany’s independent registered public accounting firm,
Moss Adams LLP, is responsible for auditing the
Company'sCompany’s consolidated financial statements and expressing an opinion as to their conformity with accounting principles generally accepted in the United States.
The Audit Committee operates under a written charter approved by the Board. The Charter provides, among other things, that the Audit Committee has full authority to engage the independent auditor, independent advisors, and consultants.
In fulfilling its oversight responsibilities, the Audit Committee reviewed and discussed the audited consolidated financial statements in the Annual Report
on Form 10-K for the year ended December 31, 2020 with management and the independent auditors,
Moss Adams LLP, including a discussion of the quality, not just the acceptability, of the accounting principles applied, the reasonableness of significant judgments, and the clarity of disclosures in the consolidated financial statements.
The Audit Committee reviewed with the independent registered public accounting firm such matters as are required to be discussed with the
Audit Committee under the standards of the Public Company Accounting Oversight Board (United States)
("PCAOB"(the “PCAOB”)
, including PCAOB Auditing Standard 1301, "Communications with Audit Committees". In addition, the Audit Committee has discussed with the independent registered public accounting firm the
auditors'auditors’ independence from management and the Company, including the matters in the written disclosures
and letter received by the Committee as required by the rules of the PCAOB regarding the independence of such auditors, and has considered the compatibility of non-audit services provided by the auditors with the
auditors'auditors’ independence.
The Audit Committee discussed with the
Company'sCompany’s internal and independent auditors the overall scope and plans for their respective audits. The Audit Committee meets with the internal and independent auditors, with and without management present, to discuss the results of their examinations or audits, their evaluations of the
Company'sCompany’s internal controls and the overall quality of the
Company'sCompany’s financial reporting.
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in the Annual Report on Form 10-K filed with the SEC for the
year ended December 31, 2018. The Audit Committee also approved the selection of Moss Adams LLP as the Company's independent registered public accounting firm for the fiscal year ended December 31,
2019.2020.
| | | Audit Committee* |
| | | Dr. William A. Longbrake, Chair |
| | | Ms. Mary Ann Donovan |
| | | Mr. Jack T. Thompson |
| | | Ms. Marie C. Johns |
*
| | |
| | Audit Committee
membership as in effect as of the filing date of this Proxy Statement. As of March 31, 2021, the filing date of the Company’s Annual Report on 10-K filed with the SEC for the year ended December 31, 2020, the Company’s Audit Committee consisted of Ms. Erin Selleck, Chairwoman,
Mr. Virgil Roberts,
and Mr. Dutch C. Ross III
III. |
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Table of Contents
The following table sets forth information with respect to current executive officers of the Company and the Bank who are not directors.
Except as noted, all references to the Bank refer to City First Bank, National Association. Officers of the Company and the Bank serve at the discretion of, and are elected annually, by the respective Boards of Directors.
Name | | Age(1) | | | | | Principal Occupation during the Past Five Years |
|---|
Brenda J. Battey
| | | 6163 | | | Executive Vice President and Chief Financial Officer of the Company since June 2013 and the Bank(2) since April 2013. Senior Vice President and Senior Controller of Bank of Manhattan from September 2011 to June 2012. Senior Vice President and Controller of Community Bank from February 2010 to September 2010. Senior Vice President and Controller of First Federal Bank of California from 1997 to 2009. |
| | | | | | |
Norman Bellefeuille | | | 6668 | | | Executive Vice President and Chief Lending Officer, Wholesale Lending, of the Bank since April 2021. Previously Executive Vice President of the Company, and Executive Vice President and Chief Loan Officer of the Bank(2) since July 2012. Lending Division Manager of Luther Burbank Savings from 2005 to July 2012. |
| | | | | | |
Ruth McCloud | | | 7072 | | | Executive Vice President /and Chief Operating Officer of the Company and Bank since April 2021. Previously Executive Vice President of the Company, and Executive Vice President and Chief Retail Banking Officer of the Bank(2) since July 2014. Senior Vice President / Divisional Sales Manager of OneWest Bank from January of 2010 to June 2014. Senior Vice President / Sales Manager of First Federal Bank of California from January 2004 to December 2009. |
| | | | | | |
Shannan A. Herbert | | | 41 | | | Executive Vice President and Chief Credit Officer of the Company since April 2021 and of the Bank since December 2018. Senior Vice President and Director of Loan Review at United Bank from January 2015 to December 2018. Vice President, Credit Officer and Credit Analyst Manager at United Bank from June 2010 to January 2015. |
| | | | | | |
Sonja S. Wells | | | 66 | | | Executive Vice President and Chief Lending Officer, Commercial Banking, of the Company and the Bank since April 2021. Previously Executive Vice President and Chief Lending Officer of the Bank since January of 2021. Senior Vice President and Interim Chief Lending Officer of the Bank from May 2020 to January 2021 and prior to that Senior Vice President and Relationship Manager of the Bank from July 2015. Senior Relationship Manager with M&T Bank in Baltimore, Maryland from June 2002 to July 2015. Small Business Relationship Sales Manager from May 1999 to 2002 at First Union National Bank (Wachovia/Wells Fargo) in Baltimore, Maryland. |
| | | | | | |
Tom Nida | | | 71 | | | Executive Vice President and Market Executive of the Company since April 2021, and of the Bank since January 2019. Senior Vice President and DC Regional Executive at John Marshall Bank from October 2017 to January 2019. Executive Vice President and Managing Director of Community Development and Non-Profit Banking as well as an Executive Vice President and DC Market President at United Bank from April 2004 to September 2016. Vice President & Chair-DC Advisory Board of EagleBank from September 2003 to March 2004, Senior Vice President in Commercial Lending and served as the Bank’s first commercial lender at City First Bank from November 1999 to September 2003. |
(2)
| Refers to Broadway Federal until April 1, 2021, the date on which Broadway Federal merged with and into City First, and to City First from and after that date. |
Table of ContentsTABLE OF CONTENTS
Summary Compensation Table
The Summary Compensation Table includes information concerning the compensation paid to or earned by our
former Chief Executive Officer
('CEO"(“CEO”) and our three other most highly compensated executive officers. Each executive is referred to herein as a named executive officer
("NEO"(“NEO”).
Wayne-Kent A. Bradshaw
Former Chief Executive Officer(5)
| | | 2020 | | | $448,050 | | | $54,375 | | | $286,510 | | | $73,265 | | | $862,200 |
| | 2019 | | | $435,000 | | | $239,100 | | | — | | | $70,963 | | | $745,063 |
| | 2018 | | | $435,000 | | | $240,072 | | | — | | | $71,515 | | | $746,587 |
Brenda J. Battey
Chief Financial Officer
| | | 2020 | | | $242,383 | | | $23,532 | | | $84,834 | | | $35,107 | | | $385,856 |
| | 2019 | | | $235,323 | | | $47,065 | | | — | | | $34,032 | | | $316,420 |
| | 2018 | | | $235,323 | | | — | | | — | | | $32,271 | | | $267,594 |
Norman Bellefeuille
Chief Lending Officer,
Wholesale Lending
| | | 2020 | | | $255,485 | | | $24,805 | | | $89,420 | | | $46,061 | | | $415,771 |
| | 2019 | | | $248,044 | | | $49,609 | | | — | | | $46,701 | | | $344,354 |
| | 2018 | | | $248,044 | | | — | | | — | | | $46,669 | | | $294,713 |
Ruth McCloud
Chief Operating Officer
| | | 2020 | | | $206,525 | | | $20,051 | | | $72,284 | | | $29,195 | | | $328,055 |
| | 2019 | | | $200,510 | | | $40,102 | | | — | | | $29,387 | | | $269,999 |
| | 2018 | | | $200,510 | | | — | | | — | | | $27,788 | | | $228,298 |
(1)
| Includes amounts deferred and contributed to the 401(k) Plan by the NEO. |
(2)
| Grant date fair value of RSU awards covering 97,195 shares of common stock in 2018 in lieu of cash bonus due to restrictions applicable to companies that participated in the United States Department of the Treasury’s Capital Assistance Program, and awards of 194,390 shares, 38,264 shares, 40,332 shares, and 32,603 shares of restricted stock awarded to Mr. Bradshaw, Ms. Battey, Mr. Bellefeuille, and Mrs. McCloud, respectively, pursuant to the LTIP in 2019 and awards of 37,371 shares, 16,173 shares, 17,048 shares and 13,781 shares of restricted stock awarded to Mr. Bradshaw, Ms. Battey, Mr. Bellefeuille, and Mrs. McCloud, respectively, pursuant to the LTIP in 2020. The restricted stock awards granted in 2019 and 2020 vest two years after the grant date. |
(3)
| The amounts shown represent the cash incentive compensation awards earned by the NEO under Broadway Federal Bank’s Incentive Plan for Management (“Incentive Plan”), based on the objective criteria established by the Broadway board of directors pursuant to the Incentive Plan at the beginning of each year and discretionary amounts as determined by the Broadway board of directors’ compensation and benefits committee (“compensation committee”). The compensation committee evaluates the performance results at the beginning of the following year and approves the amounts of bonuses to be paid. |
(4)
| Includes amounts paid by Broadway to the 401(k) account of the NEO and allocations under Broadway’s Employee Stock Ownership Plan. Also includes perquisites and other benefits consisting of automobile and telephone allowances. |
(5)
| Through March 31, 2021. |
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| | Name and Principal Position
| |
| | Year
| |
| | Salary(1)
| |
| | Stock
Awards(2)(3)
| |
| | Option
Awards(3)
| |
| | Non-Equity
Incentive Plan
Compensation(4)
| |
| | All Other
Compensation(5)
| |
| | Total
($)
| |
|
|---|
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| | | Wayne-Kent A. Bradshaw | | | | | 2018 | | | | $ | 435,000 | | | | $ | 240,072 | | | | | - | | | | | - | | | | $ | 71,515 | | | | $ | 746,587 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Chief Executive Officer | | | | | 2017 | | | | $ | 435,000 | | | | $ | 230,101 | | | | | - | | | | | - | | | | $ | 70,299 | | | | $ | 735,400 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | 2016 | | | | $ | 415,000 | | | | $ | 224,100 | | | | | - | | | | | - | | | | $ | 59,961 | | | | $ | 699,061 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Brenda J. Battey | | | | | 2018 | | | | $ | 235,323 | | | | | - | | | | | - | | | | | - | | | | $ | 32,271 | | | | $ | 267,594 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Chief Financial Officer | | | | | 2017 | | | | $ | 235,323 | | | | | - | | | | | | | | | $ | 47,065 | | | | $ | 33,427 | | | | $ | 315,815 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | 2016 | | | | $ | 228,469 | | | | | - | | | | $ | 64,500 | | | | $ | 45,694 | | | | $ | 63,887 | | | | $ | 402,550 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Norman Bellefeuille | | | | | 2018 | | | | $ | 248,044 | | | | | - | | | | | - | | | | | - | | | | $ | 46,669 | | | | $ | 294,713 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Chief Loan Officer | | | | | 2017 | | | | $ | 248,044 | | | | | - | | | | | - | | | | $ | 49,609 | | | | $ | 49,129 | | | | $ | 346,782 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | 2016 | | | | $ | 240,819 | | | | | - | | | | $ | 86,000 | | | | $ | 48,164 | | | | $ | 123,107 | | | | $ | 498,090 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Ruth McCloud | | | | | 2018 | | | | $ | 200,510 | | | | | - | | | | | - | | | | | - | | | | $ | 27,788 | | | | $ | 228,298 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Chief Retail Banking Officer | | | | | 2017 | | | | $ | 200,510 | | | | | - | | | | | - | | | | $ | 40,102 | | | | $ | 28,963 | | | | $ | 269,575 | | |
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| | | | | | | | 2016 | | | | $ | 194,670 | | | | | - | | | | $ | 43,000 | | | | $ | 38,934 | | | | $ | 22,642 | | | | $ | 299,246 | | |
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(1)Includes amounts deferred and contributed to the 401(k) Plan by the NEO.(2)Relates to award of 120,483 shares of restricted stock awarded to Mr. Bradshaw pursuant to the LTIP in 2016, and RSU awards covering 129,270 shares and 97,195 shares of Common Stock in 2017 and 2018, respectively, in lieu of cash bonuses due to restrictions applicable to companies that participated in the U.S. Treasury Department's Capital Assistance Program. The restricted stock awarded in 2016 vested two years after the grant date as to 100,000 shares and three years after the date of grant as to 20,483 shares, in each case subject to a further schedule based on the extent to which assistance received from the Treasury Department is repaid.(3)The amounts shown reflect the aggregate grant date fair value of restricted stock awards, RSU awards and option awards, as determined in accordance with FASB ASC Topic 718. Additional information concerning our accounting for restricted stock and options granted in 2016 is included in Note 11 of the Notes to the Consolidated Financial Statements of the Company filed with the SEC as part of the Company's Annual Report on Form 10-K for the year ended December 31, 2016.(4)The amounts shown represent the cash incentive compensation awards earned by the NEO under the Bank's Incentive Plan for Management ("Incentive Plan"), based on the objective criteria established by the Board pursuant to the Incentive Plan at the beginning of each year. The Compensation and Benefits Committee evaluates the performance results at the beginning of the following year and approves the amounts of bonuses to be paid under the Incentive Plan.(5)Includes amounts paid by the Company to the 401(k) account of the NEO and allocations under our Employee Stock Ownership Plan. Also includes perquisites and other benefits consisting of automobile and telephone allowances, health benefits and life insurance premiums. The amount shown for our CEO includes country club dues.
Employment Agreements
Mr. Bradshaw
Each of Brenda Battey, Norman Bellefeuille, and
each of the other NEOsRuth McCloud serve in their current positions pursuant to
Employment Agreementsemployment agreements entered into by the Company and the Bank with the respective NEOs effective in
March and May 2017
respectively.and subsequently amended in certain respects (as so amended, the “Employment Agreements’). The Employment Agreements provided for initial terms of employment of three years, subject to annual one-year extensions by mutual agreement of the parties. The Employment Agreements
initially provided for the payment of annual base salaries,
which are currently in the following amounts, subject in each case to annual review and possible increase by the
Board of the Company: Mr. Bradshaw $435,000;Board: Ms. Battey
$235,323;$247,230; Mr. Bellefeuille
$248,044;$260,594; and Ms. McCloud
$194,670.$210,655.72. The Employment Agreements also provide for
the NEOs' participation in the
Bank'sBank’s Employee Stock Ownership Plan, eligibility to receive equity-based awards pursuant to the
Company'sCompany’s Long Term Incentive Plan of such types and in such amounts as are determined by the Board
(subject inof the
case of Mr. Bradshaw to compliance with the
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U. S. Treasury Department's TARP compensation regulations),Company and eligibility to participate in all employee benefit plans applicable to senior executive officers, including the Bank'sBank’s annual cash incentive compensation plan, (excluding Mr. Bradshaw to the extent required by the TARP compensation regulations), the Company'sCompany’s 401(k) plan (with continuation of the Company'sCompany’s employee contribution matching policy as of the effective date of the Employment Agreements)employment agreements), and medical, dental, life and long-term disability programs.
The Employment Agreements may be terminated by the Company with or without Cause (including failure by the Company to request an annual extension of an agreement’s term), may be terminated by the NEO with or without Good Reason, and will also terminate in the event of the death or Disability (as defined in the Employment Agreements)employment
TABLE OF CONTENTS
agreements) of an NEO.
"Cause"“Cause” is defined in the Employment Agreements to include, among other reasons: failure substantially to perform the
NEO'sNEO’s duties, or material breach by the NEO of
the Employment Agreementhis or her employment agreement or any material written policy of the Company, in each case if not cured within 30 days after notice from the Board requiring such cure; willful violation of any law, rule or regulation (excluding traffic violations and similar offenses); entry of a final regulatory cease and desist order against the NEO; and other offenses involving fraud, moral turpitude, or dishonesty involving personal profit.
"Good Reason"“Good Reason” is defined in the
Employment Agreementsemployment agreements to mean, among
other events: demotion, or loss of title or authority, of an NEO; reduction of an
NEO'sNEO’s base salary; relocation of an
NEO'sNEO’s primary work location by more than 20 miles; or material breach of an
NEO's Employment AgreementNEO’s employment agreement by the Company.
In the event of
any termination
of an Employment Agreement by the Company
due to Disability or withoutof an NEO’s employment, except termination for Cause, or by the NEO,
for Good Reason, the NEO would be entitled to receive all amounts accrued for payment to the NEO to the date of termination and not previously paid, including base salary, unreimbursed business expenses, vested amounts under the
Company'sCompany’s 401(k) Plan and other employee benefit plans (collectively, the
"Accrued Obligations"“Accrued Obligations”). The NEO would also be entitled to continue to receive an amount equal
to the
NEO'sNEO’s monthly base salary for a specified period (the
"Severance Period"“Severance Period”) and would continue during the Severance Period to be entitled to receive the
NEO'sNEO’s automobile allowance and payment by the Company of the
NEO'sNEO’s life, long-term disability, medical and dental insurance premiums provided for in the
NEO's Employment AgreementNEO’s employment agreement (such payments during the Severance Period being collectively referred to as the
"Severance Payments"“Severance Payments”). The Severance Periods specified in the
Employment Agreementsemployment agreements for the respective NEOs are:
Mr. Bradshaw 36 months; Ms. Battey 24 months; Mr. Bellefeuille 30 months; and Ms. McCloud 18 months. In the event of termination
of an Employment Agreement for Cause, or due to death,
or voluntary termination by an NEO without Good Reason, the NEO or the
NEO'sNEO’s estate would only be entitled to receive payment of the Accrued Obligations for
suchthe NEO.
The Employment Agreements provide that if the employment of an NEO is terminated by the Company without Cause or by the NEO for Good Reason within two years after a Change in Control of the Company has occurred, the NEO will be entitled to receive a single lump sum payment equal to the present value of the Severance Payments described above.above, subject to execution of a general release. The present value of the Severance Payments would be calculated using the Applicable Federal Rate published by the Internal Revenue Service from time to time. "Change“Change in Control"Control” is defined in the Employment Agreements to include: events that would be required to be reported as such pursuant to the Exchange Act or federal banking laws and regulations; any person or entity acquiring beneficial ownership of 50% or more of the Company'sCompany’s outstanding securities; and changes in the composition of the Board of the Company that result, with certain exceptions, in directors who were members of the Boardboard as of the effective date of the Employment Agreements ceasing to constitute a majority of the Board.board.
TableThe Employment Agreements contain post-employment non-solicitation provisions pursuant to which, for a period of Contents
twelve months following termination, the NEO is prohibited from (i) attempting to influence any customer of the Company or the Bank to discontinue use of the Company’s or the Bank’s services, or (ii) attempting to disrupt the relationship between the Company or the Bank and any of their respective employees, customers or other persons having specified relationships with the Company or the Bank.
The
Bank'sBank’s Incentive Plan
for Management ("Incentive Plan") is designed to reward management for productivity, high performance, and implementing the business plan and vision of the Bank. The Compensation and Benefits Committee establishes performance objectives in advance of each year. These performance objectives are derived from the
Company’s Strategic Plan, which is reviewed and approved by the Board annually, and typically covers the ensuing three years. The compensation payable under the Incentive Plan is tied directly to the attainment of the pre-established performance objectives. The Incentive Plan provides for a minimum, target and maximum incentive opportunity equal to 25%, 40%
, and 65%, respectively, of base salary for the CEO, and 20%, 35%
, and 50%, respectively, of base salary for the
other senior executive
officers. Due to restrictions applicable to companies that participated in the U.S. Treasury Department's Capital Assistance Program, the CEO cannot participate in the Incentive Plan until the aggregate financial assistance received by the Company from U.S. Treasury has been repaid.officers, and lower percentages of base salary for other managers.
In order for the Incentive Plan participants to receive any form of payout, a minimum financial threshold of 80% of the Board approved consolidated net earnings for the Incentive Plan year must be achieved. For
each year,
2018, the Board
establishedestablishes specific objectives in the following areas:
Net Earnings
•Capital
•Compliance
•
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Net Loan Growth
•Asset Quality
•At the end of the Incentive Plan year, each goal
wasis assessed, and results calculated. The Compensation and Benefits Committee, pursuant to the terms of the Incentive Plan, determined that the pre-established objectives for
year 2018
and 2019 were
achieved. Grants of Plan-Based Awardsachieved at least in 2018
Therepart, and those achievements were no grants ofused by the Committee to determine the restricted stock or optionsawards that were granted in early 2019 and 2020. No cash bonuses were paid for 2018 and 2019 performance.
Restricted Stock Awards
Restricted stock awards totaling 84,373 shares were granted to the NEOs for the year ended December 31, 2018. The CEO was awarded 97,1952019 in February 2020 as follows: 37,371 shares, 16,173 shares, 17,048 shares, and 129,270 cash-settled13,781 shares were granted to Mr. Bradshaw, Ms. Battey, Mr. Bellefeuille, and Mrs. McCloud, respectively. These restricted stock awards became fully vested upon closing of the Merger with CFBanc on April 1, 2021. In February 2019, restricted stock awards totaling 305,589 shares were granted to the NEOs for performance in calendar 2018 as follows: 194,390 shares, 38,264 shares, 40,332 shares, and 32,603 shares were granted to Mr. Bradshaw, Ms. Battey, Mr. Bellefeuille, and Mrs. McCloud, respectively. These restricted stock awards were fully vested on February 26, 2021. There were no grants of restricted stock units ("RSUs") during 2018 and 2017, respectively. All RSUs vest at the end of two years from the date of the grant and are subject to forfeiture until vested. Each RSU entitles the CEO to receive cash equalor stock options to the fair market value of one share of common stock onNEOs for the applicable payout date.years ended December 31, 2020.
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Outstanding Equity Awards at December 31, 2018
2020
The following table sets forth information concerning outstanding equity awards held by each NEO as of December 31,
2018.2020.
Wayne K. Bradshaw | | | — | | | — | | | — | | | — | | | 231,761 | | | $428,758 |
Brenda J. Battey | | | 120,000 | | | 30,000 | | | $1.62 | | | 02/24/26 | | | 54,437 | | | $100,708 |
Norman Bellefeuille | | | 160,000 | | | 40,000 | | | $1.62 | | | 02/24/26 | | | 57,380 | | | $106,153 |
Ruth McCloud | | | 80,000 | | | 20,000 | | | $1.62 | | | 02/24/26 | | | 46,384 | | | $85,810 |
| | | | | | | | | | | | | | | | | | | |
| | Option Awards | | Restricted Stock Award | |
|---|
| Name | | Number of
Securities
Underlying
Unexercised
Options
(Exercisable) | | Number of
Securities
Underlying
Unexercised
Options
(Unexercisable)(1) | | Option
Exercise
Price(2) | | Option
Expiration
Date(3) | | Number of
Shares
That Have
Not
Vested(4) | | Market
Value of
Shares That
Have Not
Vested(5) | |
|---|
Wayne K. Bradshaw | | | 75,000 | | | - | | $ | 4.98 | | | 03/18/19 | | | 20,483 | | $ | 21,507 | |
Brenda J. Battey | | | 60,000 | | | 90,000 | | | 1.62 | | | 02/24/26 | | | - | | | - | |
Norman Bellefeuille | | | 80,000 | | | 120,000 | | | 1.62 | | | 02/24/26 | | | - | | | - | |
Ruth McCloud | | | 40,000 | | | 60,000 | | | 1.62 | | | 02/24/26 | | | - | | | - | |
(1)Options vest in equal annual installments on each anniversary date over a period of five years commencing on the date of grant.(2)(1)
| Options vest in equal annual installments on each anniversary date over a period of five years commencing on the date of grant. |
(2)
| Based upon the fair market value of a share of Company common stock on the date of grant. |
(3)
| Terms of outstanding stock options are for a period of ten years from the date the option is granted. |
(4)
| There were no vested restricted stock awards as of December 31, 2020. For Mr. Bradshaw, 84% of the Restricted Stock Awards outstanding at December 31, 2021, vested on February 27, 2021, and the remaining 16 % had an original vesting date of February 26, 2022, but vested in full upon the closing of the Merger. For Ms. Battey, Mr. Bellefeuille, and Ms. McCloud, 70% vested on February 27, 2021, and the remaining 30% had an original vesting date of February 26, 2022 but vested in full upon the closing of the Merger. |
(5)
| Based upon a market value of $1.85 per share for the Company’s common stock as of December 31, 2020. |
Anti-Hedging Policy
Our employees, officers and directors are prohibited from engaging in any kind of hedging transaction that could reduce or limit such person’s holdings, ownership or interest in or to any securities of the Company. Prohibited transaction include the purchase of financial instruments such as prepaid variable forward contracts, instruments for short sale or purchase or sale of call or put options, equity swaps, collars, or units of exchangeable funds, that are designed to or that may reasonably be expected to have the effect of hedging or offsetting a decrease in the market value of a share of Company common stock on the date of grant.
(3)Terms of outstanding stock options are for a period of ten years from the date the option is granted.(4)20,483 shares vested on March 30, 3019, which is the third anniversaryany securities of the date of grant.(5)Based upon a market value of $1.05 per share for the Company common stock as of December 31, 2018.
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Members of the Board
of Directors of Broadway Financial Corporation do not receive separate compensation for their service on the
Bank’s Board of
Directors of Broadway Federal Bank.Directors.
For the year ended December 31,
2018,2020, each member of the Board received $1,000 per meeting for attending monthly and special board meetings. The Chairman of the Board received an additional annual retainer of $10,000. Committee members received an additional annual retainer of $8,000 and Committee Chairpersons received an additional annual retainer of $6,000 for such service, except for the Corporate Governance Committee Chair, who received an additional annual retainer of $4,000.
On April 21, 2021, the Board approved revised compensation terms for non-employee directors. Under the new terms, each non-employee director will receive an annual award of unrestricted shares of common stock of the Company valued at $7,500. The non-employee Chair of the Board will receive an annual cash leadership retainer of $10,000, payable quarterly in installments of $2,500 per quarter. The Lead Independent Director will receive an annual cash retainer of $9,000, payable quarterly in installments of $2,250 per quarter. All other non-employee directors will receive an annual retainer of $8,000, payable quarterly in installments of $2,000. The Chair of each of the Audit Committee, the Compensation and Benefits Committee, the Corporate Governance Committee, the Risk and Compliance Committee, the Internal Asset Review Committee, and the Directors Loan Committee shall receive an annual cash retainer of $6,000, payable quarterly in installments of $1,500. Each non-employee director shall receive a Board meeting fee of $1,000 for attendance at each regular meeting and duly-called special meeting of the Board, and will be paid a fee of $1,000 in August whether or not a meeting is held in August. In addition, each non-employee director shall receive an annual Committee Service Fee of $8,000, payable quarterly in installments of $2,000. No Director shall receive a payment in respect of any meeting that the Director does not attend, or any meeting that is cancelled.
The following table summarizes the compensation paid to non-employee directors for the year ended December 31,
2018.2020.
Robert C. Davidson | | | $35,000 | | | $7,500 | | | $578 | | | $43,078 |
Daniel Medina* | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Virgil Roberts* | | | $37,000 | | | $7,500 | | | — | | | $44,500 |
Dutch C. Ross III | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Erin Selleck* | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Jack T. Thompson | | | $23,000 | | | $7,500 | | | — | | | $30,500 |
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or Paid in
Cash(1)
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Compensation(3)
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| | | Robert C. Davidson | | | | $ | 32,000 | | | | $ | 7,500 | | | | $ | 516 | | | | $ | 40,016 | | |
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| | | A. Odell Maddox(4) | | | | $ | 21,000 | | | | $ | 7,500 | | | | | - | | | | $ | 28,500 | | |
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| | | Daniel Medina | | | | $ | 26,000 | | | | $ | 7,500 | | | | | - | | | | $ | 33,500 | | |
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| | | Virgil Roberts | | | | $ | 34,000 | | | | $ | 7,500 | | | | | - | | | | $ | 41,500 | | |
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| | | Dutch C. Ross III | | | | $ | 26,000 | | | | $ | 7,500 | | | | | - | | | | $ | 33,500 | | |
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| | | Erin Selleck | | | | $ | 26,000 | | | | $ | 7,500 | | | | | - | | | | $ | 33,500 | | |
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*
| Former director whose position was terminated upon the closing of the Merger. |
(1)
| Includes payments of annual retainer fees, fees paid to chairpersons and members of Board committees, and meeting attendance fees. |
(2)
| The amounts shown reflect the aggregate fair value of stock awards of 5,155 shares of Broadway’s Voting Common Stock to each Director on the grant date of February 26, 2020, as determined in accordance with FASB ASC Topic 718. |
(3)
| Includes premiums paid for dental and vision insurance. |
(1)Includes payments of annual retainer fees, fees paid to chairmen and members of Board committees, and meeting attendance fees.
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(2)The amounts shown reflect the aggregate grant date fair value of stock awards, as determined in accordance with FASB ASC Topic 718.(3)Includes premiums paid for dental and vision insurance.(4)Mr. Maddox retired from the Board of Directors on February 28, 2019.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions by us with related persons are subject to formal written policies, as well as regulatory requirements and restrictions. These requirements and restrictions include Sections 23A and 23B of the Federal Reserve Act and the Federal Reserve’s Regulation W (which govern certain transactions by us with our affiliates) and the Federal Reserve’s Regulation O (which governs certain loans by the Bank to its executive officers, directors, and principal stockholders). We have adopted policies to comply with these regulatory requirements and restrictions. The
Company'sCompany’s current loan policy provides that all loans made by the Company or its subsidiary to its directors and executive officers or their associates must be made on substantially the same terms, including interest rates, collateral and repayment terms, as those prevailing at the time for comparable transactions with other persons of similar creditworthiness who are not related to the Company and must not involve more than the normal risk of collectability or present other unfavorable features. As of December 31,
2018,2020, the Company did not have any loans to related parties or affiliates.
Loans to insiders and their related interests require approval by the Board, or a Board designated committee. We also apply the same standards to any other transactions with an insider. Personal loans made to any executive officer or director must comply with Regulation O. Additionally, loans and other related party transactions are subject to Audit Committee review and approval requirements.
From time to time, City First Enterprises and the Bank will each make an investment in the same community development project. These loans by the Bank are made in the ordinary course of business on substantially the same terms, including interest rate and collateral, as those prevailing at the time for comparable loans with persons not related to the Bank, and do not involve more than the normal risk of collectability or present other unfavorable features. All such loans are reviewed, approved, or ratified by the Director’s Loan Committee of the Bank and are made in accordance with the Bank’s lending and credit policies.
Employment Agreement for Brian Argrett
The Company and our President and Chief Executive Officer, Mr. Argrett, are parties to an employment agreement dated as of December 29, 2017, pursuant to which Mr. Argrett serves as our President and Chief Executive Officer. This agreement was assumed by the Company in the Merger. The current term of the agreement extends until December 31, 2022. The term of agreement may be extended, modified, or renewed upon written agreement of the parties. Under the agreement, Mr. Argrett receives a current base salary of $450,000, which is reviewed by the Board on an annual basis and may be increased at the Board’s discretion; an annual incentive bonus as determined by the Board; and deferred compensation determined by the Board (see “Nonqualified Deferred Compensation Plan for Brian Argrett” below). These determinations may be delegated to the compensation committee of the Board. Mr. Argrett is entitled to participate in the Company’s generally available employee benefit plans.
Mr. Argrett’s agreement contains post-employment noncompetition and nonsolicitation restrictions. Under such provisions, for a period of one year following his termination or the expiration of the agreement Mr. Argrett is prohibited from (i) calling upon for the purpose or with the intent of hiring any person who is or was within the 6 months preceding Mr. Argrett’s date of termination, a sales, or management employee of the Company or (ii) calling upon any person who is at that time or has been within the 12 months preceding Mr. Argrett’s date of termination, a customer or prospective customer of the Company for the purpose of soliciting or selling products or services in direct competition with the Company.
In the event of termination of Mr. Argrett’s agreement by the Company without cause, or if upon or following a change in control Mr. Argrett resigns with good reason as such terms are defined in the agreement, Mr. Argrett would be entitled to receive salary at his then-current rate of salary for a period of 18 months, subject to his timely execution and delivery of a general release.
Nonqualified Deferred Compensation Plan for Brian Argrett
On December 5, 2018, City First established a non-qualified deferred compensation plan that permits Mr. Argrett to defer receipt of a percentage of his salary. The Board determines in its sole discretion the percentage to be contributed each year. Mr. Argrett is the only participant of the plan.
Parents of Smaller Reporting Company
City First Enterprises is the owner of 6,622,236 shares of our Voting Common Stock, which represents approximately 15.16% of our Voting Common Stock outstanding. In addition, three members of our Board – Mr. Argrett, our President and CEO, Dr. Longbrake, and Mr. McGrady – are also members of the Board of Directors of City First Enterprises.
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DELINQUENT SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE16(A) REPORTS
Section 16(a) of the Exchange Act requires the Company'sCompany’s executive officers and directors, and persons who own more than 10% of the Company'sCompany’s Voting Common Stock, to report to the SEC their initial ownership of shares of the Company'sCompany’s common stock and any subsequent changes in that ownership. Specific due dates for these reports have been established by the SEC and any late filings or failures to file are to be disclosed in this Proxy Statement. Officers,The Company’s executive officers and directors, and greaterpersons who own more than 10% stockholdersof the Company’s Voting Common Stock are required by SEC rules to furnish the Company with copies of all forms that they file pursuant to Section 16(a) of the Exchange Act. BasedOn July 28, 2021, Mr. Argrett filed a Form 4 regarding the issuance of restricted shares of our Voting Common Stock to him on our reviewJuly 21, which filing was required under applicable regulations to have been made by the end of the reportssecond business day after the issuance. On August 19, 2021, City First Enterprises filed a Form 3 and a Form 4 relating to shares of Voting Common Stock issued in exchange for CFBanc Class A Common Stock in the Merger on April 1, 2021, which filings were required under Section 16(a) thatapplicable regulations to have been furnished to us, we are not aware of any reporting person under Section 16(a)made by the end of the Exchange Act that failed to file such reports on a timely basis duringtenth day and second business day, respectively, after the last fiscal year.issuance.
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REGISTERED PUBLIC ACCOUNTING FIRM
The Board has appointed Moss Adams LLP
("(“Moss
Adams"Adams”) as the
Company'sCompany’s independent registered public accounting firm for the fiscal year ending December 31,
2019.2021. This appointment is being submitted to the stockholders for their consideration and
ratification.ratification as a matter of good corporate governance. If the appointment of Moss Adams is not ratified by the stockholders, the Audit Committee will consider the
stockholders'stockholders’ vote in deciding whether to reappoint Moss Adams as independent registered public accounting firm in the future.
It is anticipated that representatives of Moss Adams will be present at the Annual Meeting. The Moss Adams representatives will be given an opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate questions from stockholders. Moss Adams performed the independent audits of the
Company'sCompany’s consolidated financial statements for the fiscal years ended December 31,
20182020 and
2017.2019.The Board of Directors unanimously recommends that you vote "FOR"“FOR”
the proposal to ratify the appointment of Moss Adams LLP
as the Company's Company’s
independent registered public accounting firm.
Principal Accountant Fees and Services
The Audit Committee approves each engagement before the
Company'sCompany’s independent accountants, Moss Adams,
LLP, are engaged to render non-audit services for the Company or the Bank. No non-audit services were provided by Moss Adams
LLP for the years indicated, except as indicated in the table below. The Audit Committee also preapproved all of the audit and audit-related services provided by Moss Adams
LLP for the years ended December 31,
20182020 and
2017.2019.
The following table sets forth the aggregate fees billed to us by Moss Adams
LLP for the years indicated, inclusive of
out of pocketout-of-pocket expenses.
Audit fees(1) | | | $214 | | | $197 |
Audit-related fees(2) | | | 16 | | | 12 |
Total fees | | | $230 | | | $209 |
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| | 2018 | | 2017 |
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| | (In thousands)
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Audit fees(1) | | $192 | | $195 |
Audit-related fees(2) | | 7 | | 6 |
Tax Fees(3) | | 72 | | 69 |
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Total fees | | $271 | | $270 |
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(1)
| Aggregate fees billed for professional services rendered for the audit of the Company’s consolidated annual financial statements included in the Company’s Annual Report on Form 10-K and for the reviews of the Company’s consolidated financial statements included in the Company’s Quarterly Reports on Form 10-Q. |
(2)
| Consultation fees billed for professional services rendered for: a) on the then proposed Merger in 2020; b) the reviews of the valuation of the Company’s deferred tax assets in 2019. |
(1)Aggregate fees billed for professional services rendered for the audit of the Company's consolidated annual financial statements included in the Company's Annual Report on Form 10-K and for the reviews of the Company's consolidated financial statements included in the Company's Quarterly Reports on Form 10-Q.(2)Consultation fees billed for professional services rendered for the review of a Registration Statement on Form S-8 filed with the SEC by the Company.(3)Consists of tax filing and tax related compliance and other advisory services.
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PROPOSAL 3. ADVISORY (NON-BINDING) VOTE TO APPROVE
Our overall executive compensation program, as described in this Proxy Statement, is designed to pay for performance and directly align the interests of our executive officers with the long-term interests of our stockholders.
Our stockholders are asked to vote to approve, on an advisory (non-binding) basis, the compensation of our Named Executive Officers as disclosed in this Proxy Statement in accordance with SEC
rules and the TARP rules of the U.S. Treasury Department.rules. Accordingly, stockholders will be asked at the Annual Meeting to vote on the following resolution:
"Resolved,
“Resolved, that the stockholders of Broadway Financial Corporation hereby approve the compensation of the Named Executive Officers as disclosed in the Summary Compensation Table of the Proxy Statement for the Annual Meeting pursuant to Item 402 of Regulation S-K.
"”
This vote will not be binding on the
Company'sCompany’s Board and may not be construed as overruling a decision by the Board or create or imply any additional fiduciary duty of the Board. Nor will it affect any compensation paid or awarded to any executive officer. The Compensation and Benefits Committee and the Board may, however, take the outcome of the vote into account when considering future executive compensation arrangements.
The Board of Directors unanimously recommends that you vote "FOR"“FOR” the approval,
on an advisory basis, of the compensation of our named executive officers
as disclosed in this Proxy Statement.
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STOCKHOLDER PROPOSALS FOR PRESENTATION
Any stockholder of the Company wishing to have a proposal considered for inclusion in the
Company's 2020Company’s 2022 proxy statement must set forth the proposal in writing and file it with the Corporate Secretary of the Company on or before
January 16, 2020,May 12, 2022, or such
laterother date as may be designated by the Board if the
20202022 Annual Meeting of Stockholders (the
"2020“2022 Annual
Meeting"Meeting”) is
not held
in June.more than 30 days before or 30 days after the anniversary of the 2021 Annual Meeting (October 20, 2022). The Board will review any stockholder proposal that is filed as required and will determine whether such proposal meets applicable criteria for inclusion in the proxy statement for, and for consideration at, the
20202022 Annual Meeting. Except for director nominations, any stockholder
may make anywishing to have a proposal
at the 2020 Annual Meeting and the same may be discussed and considered
but unless statedat the 2022 Annual Meeting must set forth the proposal in writing and
filedfile it with the Corporate Secretary of the Company on or before
May 27, 2020,July 22, 2022 or,
such later date as may be designated by the Board if the
20202022 Annual Meeting is
not held
in June, such proposal may only be voted upon at a meeting held at leastmore than 30
days before or 60 days after the
anniversary of the 2021 Annual Meeting
ator, if later, 10 days following the day on which
itpublic disclosure of the date of the 2022 Annual Meeting is
presented.first made by the Company.
Under the
Company's Bylaws,Company’s bylaws, stockholder nominations for election of directors at the
20202022 Annual Meeting may only be made pursuant to timely notice in writing received by the Corporate Secretary of the Company
not lesson or before July 22, 2022 or, if the 2022 Annual Meeting is held more than
30 days before or 60 days
nor more thanafter the anniversary of the 2021 Annual Meeting (October 20, 2022), the deadline is 90 days
prior tobefore the
anniversary2022 Annual Meeting or, if later, 10 days following the day on which public disclosure of the date of the
previous year's annual meeting of stockholders to be considered at2022 Annual Meeting is first made by the
2020 Annual Meeting.Company. The notice must state the
nominee'snominee’s name, age, business and residence addresses,
and principal occupation or employment, and the class and number of shares of Common Stock beneficially owned by the nominee on the date of the notice. The required notice must also disclose certain information relating to the nominee of the type required to be disclosed in a proxy statement and in certain other filings under federal securities laws.
ANNUAL REPORT AND FORM 10-K The
Company's 2018Company’s 2020 Annual Report to Stockholders, which includes our
20182020 Annual Report filed with the SEC on Form 10-K and contains the
Company'sCompany’s consolidated financial statements for the years ended December 31,
20182020 and
2017,2019, accompanies this Proxy Statement.
Stockholders may obtain, without charge, a copy of the
Company'sCompany’s Annual Report on Form 10-K for the year ended December 31,
2018,2020, as filed with the SEC, without the accompanying exhibits, by sending a written request to Broadway Financial Corporation, 5055 Wilshire Boulevard, Suite 500, Los Angeles, California 90036, Attention:
Alice Wong.Audrey A. Phillips. Stockholders may obtain any of the exhibits that are referred to in the list of exhibits attached to the Annual Report on Form 10-K upon payment to the Company of the cost of furnishing them.
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| | | BY ORDER OF THE BOARD OF DIRECTORS |
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| | Alice Wong |
| | | Audrey A. Phillips
VP Vice President and Corporate Secretary
May 17, 2019 September 9, 2021 |
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| 02 - Dutch C. Ross III
| 03 - Jack T. Thompson
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| Abstain
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Broadway Financial Corporation
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Notice of 2019 Annual Meeting of Shareholders
Proxy Solicited by Board of Directors for Annual Meeting – June 26, 2019
Wayne-Kent A. Bradshaw, or any of them, each with the power of substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the powers which the undersigned would possess if personally present, at the Annual Meeting of Broadway Financial Corporation to be held on June 26, 2019 at 2:00 p.m. or at any postponement or adjournment thereof.
Shares represented by this proxy will be voted by the stockholder. If no such directions are indicated, the Proxies will have authority to vote FOR the election of the Board of Directors and FOR items 2-4.
In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting.
(Items to be voted appear on reverse side)
Change of Address – Please print new address below.
| | Comments – Please print your comments below.
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| Broadway Financial Corporation
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| Using a black ink pen, mark your votes with an X as shown in this example.
Please do not write outside the designated areas.
| 
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2019 Annual Meeting Proxy Card
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| IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
|
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| Proposals – The Board of Directors recommend a vote FOR all the nominees listed and FOR Proposals 2 - 4.
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| 1. Election of Directors:
| 
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| | 01 - Robert C. Davidson Jr
| 02 - Dutch C. Ross III
| 03 - Jack T. Thompson
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| Mark here to WITHHOLD vote from all nominees
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| For All EXCEPT - To withhold a vote for one or more nominees, mark the box to the left and the corresponding numbered box(es) to the right. |
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| | For
| Against
| Abstain
| | For
| Against
| Abstain
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| 2. To ratify the appointment of Moss Adams LLP as the Company’s independent registered public accounting firm for 2019.
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| Authorized Signatures – This section must be completed for your vote to count. Please date and sign below.
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| Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
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IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
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Broadway Financial Corporation
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Notice of 2019 Annual Meeting of Shareholders
Proxy Solicited by Board of Directors for Annual Meeting – June 26, 2019
Wayne-Kent A. Bradshaw, or any of them, each with the power of substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the powers which the undersigned would possess if personally present, at the Annual Meeting of Broadway Financial Corporation to be held on June 26, 2019 at 2:00 p.m. or at any postponement or adjournment thereof.
Shares represented by this proxy will be voted by the stockholder. If no such directions are indicated, the Proxies will have authority to vote FOR the election of the Board of Directors and FOR items 2-4.
In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting.
(Items to be voted appear on reverse side)
