planning for succession to the offices of our executive officers and making recommendations to our Board with respect to the selection of appropriate individuals to succeed to these positions;
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evaluating and approving compensation plans and programs and evaluating and approving the modification or termination of our existing plans and programs; and
establishing and reviewing general policies relating to compensation and benefits of our employees and evaluating our overall compensation strategy.
| | | Credit Risk and Finance Committee | Sandra A. Smith (Chair)* Our credit risk and finance committee consists of Mr.Roy Banks Ms.
Jo Ann Barefoot Mr. Carl Pascarella Ms. Smith, and Mr. Williams. Mr. Banks and Ms. Smith joined the committee in September 2021. Mr. Pascarella served as chair of the credit risk and finance committee from March 5, 2021 to March 3, 2022. Effective March 3, 2022, Ms. Smith was appointed chair of the credit risk and finance committee and Mr. Pascarella continues to serve as a member. Our credit risk and finance committee met four times during our last fiscal year. Specific responsibilities of our credit risk and finance committee include: R. Neil Williams reviewing
*SinceMarch 2022 | | Primary responsibilities: • Review the quality of our credit portfolio and the trends affecting that portfolio through the review of selected measures of credit quality and trends and such other information as it deems appropriate;trends; overseeing the effectiveness and administration of, and compliance with, our credit, pricing and collections policies through the review of our processes and reports, as appropriate;
overseeing our• Oversee credit and pricing risk and making recommendations to managementmonitors policy administration and our Board regarding such risks;compliance;
reviewing periodically with management our historical and• Monitor projected compliance with the covenants and restrictions arising under our financial obligations and commitments;
assessing and making recommendations to our Board regarding• Assess funding acquisitions, borrowing and lending strategy to meet profitability objectives;strategy; and
reviewing and making recommendations to our Board regarding• Review potential financial transactions and commitments, including equity and debt financings, capital expenditures, and financing arrangements.
| Nominating, Governance and Social Responsibility Committee | Ginny Lee (Chair)* Our nominating, governance and social responsibility committee consists of Ms. Alvarez, Ms. Lee, Mr.Louis Miramontes Mr.
David Strohm and Mr. Welts. Ms. Lee and Mr. Frederic Welts joined the committee in September 2021. The chair of our nominating, governance and social responsibility committee is Ms. Alvarez. Our nominating, governance and social responsibility committee met five times during our last fiscal year. Specific responsibilities of our nominating, governance and social responsibility committee include: identifying
*SinceNovember 2022 | | Primary Responsibilities: • Identify and evaluatingrecommend qualified candidates for election to the Board; • Oversee the composition, structure and size of the Board and its committees; • Oversee corporate governance policies and practices, including the nominationOportun’s Code of incumbent directors for reelectionBusiness Conduct; • Oversee Oportun’s strategies, policies, and nominees recommended by stockholders,practices relating to serve on our Board; reviewing the performance of our Board, including committees of our Board;
overseeing and periodically reviewing the Company’s environmental, social and governance (ESG) strategy, activities, programs and public disclosure, including in light of any feedback received from stockholders of the Company;
considering and making recommendations to our Board regarding the composition of our Board and its committees;
developing and making recommendations to our Board regarding corporate governance policies and matters; and
overseeing and reviewing our policies, processes, procedures and strategies with respect to matters, of ESG, responsible lending practices, government relations, charitable contributions and community development, support of charitable organizations, environmental sustainability, human rights and other social and public policy matters of significance tomatters; and
• Oversee the Company.annual Board performance self-evaluation process. | | | 16
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Mergers and Acquisitions Committee
The Board formed an ad hoc mergers and acquisitions committee in 2021 to review the acquisition of Digit. Our mergers and acquisitions committee consisted of Mr. Banks, Mr. Pascarella, Ms. Smith, Mr. Strohm, and Mr. Williams. Our mergers and acquisitions committee met five times during our last fiscal year.
Diversity
The nominating, governance and social responsibility committee recognizes the benefits associated with a diverse board and takes diversity considerations into account when identifying candidates. The table below provides certain highlights of the composition of our board members as of April 18, 2022.
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Diversity The nominating, governance and social responsibility committee recognizes the benefits associated with a diverse board and takes diversity considerations into account when identifying candidates. The table below provides certain highlights of the composition of our Board members as of April 17, 2023. Each of the categories listed in the below table has the meaning as it is used in Nasdaq Rule 5605(f). | | | | | | | | | Total number of directors | | | 10 | | | | | Gender identity | | | Female | | | | Male | | | | | | | | 3 | | | | 7 | | | Number of Directors who identify in Any of the Categories Below: | | | | | African American or Black | | | — | | | | 1 | | | | | Alaskan Native or Native American | | | — | | | | — | | | | | Asian | | | 1 | | | | — | | | | | Hispanic or Latinx | | | — | | | | 2 | | | | | Native Hawaiian or Pacific Islander | | | — | | | | — | | | | | White | | | 2 | | | | 4 | | | | | Two or More Races or Ethnicities | | | — | | | | 1 | | | | | LGBTQ+ | | | — | | | | 1 | | | | | Did Not Disclose | | | — | | | | 1 | |
Directors who are Military Veterans: 1 | | | | | | | | | Total Number of Directors | | | 11 | | | | | | | Female | | | Male | | | Gender Identity | | | | | | | | 4 | | | | 7 | | | Number of Directors who Identify in Any of the Categories Below: | | | | | African American or Black | | | — | | | | 1 | | | | | Asian | | | 1 | | | | — | | | | | Hispanic or Latinx | | | 1 | | | | 2 | | | | | White | | | 2 | | | | 4 | | | | | Two or More Races or Ethnicities | | | — | | | | 1 | | | | | LGBTQ+ | | | — | | | | 1 | | | | | Did Not Disclose | | | — | | | | 1 | |
| | | Directors who are Military Veterans: 1
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Compensation and Leadership Committee Interlocks and Insider Participation None of the members of our compensation and leadership committee has ever been an officer or employee of the Company. None of our executive officers serve, or have served during the last fiscal year, as a member of the members of our compensation and leadership committee has ever been an officer or employee of the Company. None of our executive officers serve, or have served during the last fiscal year, as a member of our Board, compensation and leadership committee or other Board committee performing equivalent functions of any entity that has one or more executive officers serving as one of our directors or on our compensation and leadership committee. Director Qualifications and Nomination Process Board Diversity We are committed to maintaining a Board with the right mix of skills, experiences, background, and diversity required to guide Oportun. EightSeven out of eleven (73%ten (70%) of our Board members self-identify as female or self-identify as a member of an underrepresented minority group or LGBTQ+. While the Board has not adopted a formal policy regarding diversity in identifying director nominees, we are committed to actively seeking out highly qualified women and individuals from underrepresented groups to include in the pool from which the nominees for the Board are chosen. The nominating, governance and social responsibility committee considers the skills, expertise and background of director nominees. The nominating, governance and social responsibility committee seeks director nominees that would complement and enhance the effectiveness of the existing Board and ensure that its members are appropriately diversdiverse with various relevant backgrounds, skills, knowledge, perspectives, and experiences. | | |
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Nomination to our Board Our Board has delegated to our nominating, governance and social responsibility committee the responsibility of identifying suitable candidates to nominate to our boardBoard (including candidates to fill any vacancies that may occur) and assessing their qualifications in light of the policies and principles in our corporate governance guidelines, the committee’s charter and applicable laws. The identification and selection of qualified directors is a complex and subjective process that requires consideration of many intangible factors and will be significantly influenced by the particular needs of the Board from time to time. As a result, there is no specific set of minimum qualifications, qualities or skills that are necessary for a nominee to possess, other than those that are necessary to meet legal, regulatory and Nasdaq listing requirements and the provisions of our organizational documents and committee charters. For nominations of potential candidates made other than by our Board, the stockholder or other person making such nomination shall comply with Oportun’s amended and restated bylaws, including without limitation, submission of the information or other materials required with respect to proposed nominees. Each potential candidate must provide a list of references and agree (i) to be interviewed by the nominating, governance and social responsibility committee or other directors in their discretion, and (ii) to the conduct by the Company of a review ofhave the qualifications of a proposed nominee.the potential candidate reviewed by the Company. Prior to nomination of any candidate by our Board, each member of our Board shall be provided the opportunity to meet with a candidate. Any candidate nominated shall upon request agree in writing to comply with Oportun’s Corporate Governance Guidelines and all other Oportun policies and procedures applicable to members of our Board. The nominating, governance and social responsibility committee will consider director candidates recommended by our stockholders. The nominating, governance and social responsibility committee does not intend to alter the manner in which it evaluates a candidate for nomination to our Board based on whether or not the candidate was recommended by a stockholder. Director Qualifications Our Board will determine the appropriate characteristics, skills and experience for our board of directors as a whole and for its individual members. Our Board considers recommendations for nominees from the nominating, governance and social responsibility committee. Our Board will consider the minimum general criteria set forth below, and may add additional criteria in specific searches to select candidates and existing directors for service on our Board. An acceptable candidate may not fully satisfy all of the criteria, but is expected to satisfy nearly all of them. Our Board believes that candidates for director should have certain minimum qualifications, including being able to read and understand basic financial statements, as well as having the highest personal integrity and ethics. | | | | | 17 |
In considering candidates recommended by the nominating, governance and social responsibility committee, our Board intends to consider such factors as (i) possessing relevant expertise upon which to be able to offer advice and guidance to management, (ii) having sufficient time to devote to the affairs of the Company, (iii) demonstrated excellence in his or her field, (iv) having the ability to exercise sound business judgment and (v) having the commitment to rigorously represent the long-term interests of our stockholders. Our Board reviews candidates for director nomination in the context of the current composition of our Board, the operating requirements of the Company and the long-term interests of our stockholders. In conducting this assessment, our Board considers diversity, skills, and such other factors as it deems appropriate given the current needs of our Board and the Company to maintain a balance of knowledge, experience and capability. In the case of incumbent directors whose terms of office are set to expire, our Board reviews such directors’ overall service to the Company during their term, including the number of meetings attended, level of participation, quality of performance, and any other relationships and transactions that might impair such directors’ independence. In the case of new director candidates, our Board will also determine whether the potential candidates satisfy the independence requirements of any stock exchange on which any of the Company’s capital stock is listed. | | | 18
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Stockholder Outreach
Our Board values the input of our stockholders, and we are committed to engaging with our stockholders when appropriate. In the chart below, we detail the features of our stockholder outreach.Corporate Responsibility at Oportun | | | | | | | | | The full Board reviews and provides oversight of ESG priorities, and two Board-level committees also have direct oversight responsibility for ESG-related activities. Management organizations provide strategic guidance and help drive activities. | | | | Board of Directors | | | | Management | | | | | | Nominating, Governance and Social Responsibility Committee | | | | Compensation and Leadership Committee | | | | • Executive Management Team • Sustainability Task Force • DEIB Council • Employee resource groups with Executive Sponsors
| Oversees our ESG strategy, activity, and programs, as well as advising on engagement with external stakeholdersstakeholders. | | | | Oversees our policies and strategies relating to culture and human capital management, including DEIBDEIB. | | |
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Our commitment to ESG extends throughout our entire organization. Our Board provides oversight, advice, and counsel on our business and ESG strategies. The Nominating, Governancenominating, governance and Social Responsibility Committeesocial responsibility committee has been delegated by the Board to directly oversee our ESG strategy and regularly updates the Board as a whole. Our CEO and senior management team prioritize and manage responsible and conscientious business operations to deliver on our mission and guiding principles. Each of our business units and employees serve every day to deliver an impactful suite of products and services to our members. Our ESG priorities align with our mission and values as we advance sustainable solutions for our members, cultivate an inclusive work environment, and strengthen our communities. Our Corporate Responsibility and Sustainability Report outlines our priorities around social impact, environmental sustainability, and governance, and highlights the resources we have invested in giving back to the communities that enable us to thrive as a mission-driven organization. As part of our commitment to continuous improvement, we expect to build on ESG content and analysis in future iterations of this report. We encourage you to review our most recent Corporate Responsibility and Sustainability Report (located on our website at (https://investor.oportun.com/esg/employee-diversity#csresg)) for more detailed information. Nothing on our website, including our Corporate Responsibility and Sustainability Report or sections thereof, shall be deemed incorporated by reference into this proxy statement. Below are key focus areas of our ESG strategy and descriptions of recent progress: | | |
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Social Impact Creating a lasting and positive social impact is an intentional output of the mission and values that guide what we do at Oportun. We are dedicated to helping our members build a better future through improved financial health outcomes. In our pursuit of economic equity and prosperity, we are advancing causes that are fundamental to basic human rights. We are providing opportunities for those who are often overlooked and excluded from the financial mainstream. Since our inception in 2005, we have extended over $12$15.5 billion in affordable and responsible credit to hardworking individuals. In that time, we have saved our members more than $2$2.3 billion in interest and fees versus the other credit products typically available in low-and middle-income neighborhoods.neighborhoods and helped our members save an average of $1,800 annually. In addition, we have helped put nearly 1more than 1.1 million people on a path toward financial inclusion by helping them start building a credit history. Our newly acquired company Digit, has helped save Digit members more than $7.2 billion since 2015. The financial health impact of our combined product offerings include:
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Consistent with our mission of financial inclusion, our digital banking platform providedprovides integrated products and services that are financially responsible and lower cost compared to market alternatives. With the addition of Digit,our digital banking products, we are now able to offer a comprehensive set of financial services to help a growing number of responsible, hardworking members to borrow, save, bankbudget and investspend through our digital banking platform and thus make financial health effortless for them. We take a holistic approach to serving our members and view it as our purpose to responsibly meet their current capital needs, help grow our members’ financial profiles, increase their financial awareness and put them on a path to a financially healthy life. (1) | Based on the cost of borrowing $500 as determined by a study prepared for Oportun by the Financial Health Network (FHN) “True Cost of a Loan,” October 2021;2021. |
(2) | Amount calculated as of December 2021,2022, based on a study prepared for Oportun by FHN, “Oportun: The True Cost of a Loan,” October 2021. |
(3) | | | 20Calculated based on headcount as of December 31, 2022.
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Community Involvement Since 2016, Oportun has given at least 1% of its net profit—totaling over $3.9$4.7 million—through charitable contributions to nonprofit organizations and schools, investing a portion of earnings back into the communities we serve. These are Oportun’s three charitable focus areas:
Across all our focus areas, we prioritize partnerships and nonprofit organizations serving traditionally underserved communities and people of color. We have taken steps to implement meaningful actions and continue to challenge ourselves to improve upon key areas in our business where we can advance social justice and economic equity. In 2021,2022, more than 53 percent50% of our total giving was directed toward organizations serving low- and middle-incomelow-and-middle income communities and 55 percent64% toward communities of color. We’re proud of the member-first, results-oriented culture that we’ve built together. At its center is a deep-seated connection to our mission to serve those who are not served well by the financial mainstream. We value and reward the role each of our employees play in serving our members, uplifting our communities, and fulfilling our mission. Some highlights in 20212022 include: | • | | Community partnership programs. In 2021,2022, we continued our annual Thanksgiving turkey giveaway, held our second annual Adopt a Family initiative,Season of Giving matching charitable donation campaign and participated in afood and toy drive with United Way.drives. |
| • | | 3rd Annual Volunteer Week. In our 20212022 Annual Volunteer Week, we worked with United Way acrossour employees in the United States, Mexico, and Mexico. EmployeesIndia participated in a variety of projects that benefited youth, teens, aging adults, veterans, and victims of natural disasters.individuals experiencing homelessness or food insecurity and communities in need. They translated family emergency preparedness kitseducational activities used by teachers, beautified parks and tax information,schools, served meals, taught computer skills, created financial literacy kits, provided career advice, and much more.
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| • | | Volunteer Time Off. Oportun Volunteer Time Off provides eligible employees with the ability to spend up to 1% of their annual paid time to volunteer at qualified nonprofit organizations and schools of their choice. |
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Diversity and Inclusion We actively foster a diverse, equitable, and inclusive work environment. The Oportun team reflects the communities where we live and serve our members, and all employees are treated equitably, fairly, and with respect. At Oportun, everyone is valued for their unique experience and all should feel that they belong. Below are certain diversity data of our employee population as of December 31, 2021.2022. | | | Global - Gender | | U.S. - Race and Ethnicity | | | | |
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We continue to invest significant time and effort toward executing diversity and inclusion best practices across Oportun. In 2020, we launched a global DEIB initiative to actively assess and build on the progress we have made as an organization, including establishing a DEIB council comprising a representative group of employees. Our compensation and leadership committee receives updates at least annually receives updates on the Company’s progress on DEIB initiatives, including key performance metrics, and the Chief People Officer regularly presents to the compensation and leadership committee. Our 20212022 accomplishments highlight the sincerity and urgency that we are taking to deliver on our DEIB commitments: ImplementedContinued our company-wide DEIB training via a 7-module program covering topics such as identities, biases, belonging, and allyship in our new hire programs and retail and contact center trainings;allyship;
Held workshops with senior leadership on improving diversity and inclusion and addressing unconscious bias; ConductedEstablished a diverse candidate slate policy for hiring at certain job levels and roles;
Implemented pilot mentorship program for members of our first DEIB employee engagement pulse survey to measure our progress on building an inclusive culture;ERGs; and Launched a bilingual training courseHosted month-long programming for retailvarious DEIB topics, such as our “Words Matter” program in April focused on inclusive language, and contact center teams to better serve our communities.“Allyship” programming throughout August.
Environmental We are taking, and will continue to take, steps to reduce our own environmental footprint. Oportun recognizes that a sustainable healthy planet is critical to ensuring the long-term success of our business and the well-being of the communities we serve. | | | | | 21 |
Across our operations, we are engaging with our leasing and procurement partners to evaluate measures to better record and report on our energy usage, upgrade our store designs and include more sustainable materials, and improve our waste management practices. In 2021, we also focused on the vehicles our district managers use to visit our locations, and are now prioritizing the shift to hybrid vehicles. Other2022, other areas that we made progress in include: | | |
| | Reducing carbon footprint 20,4486,737 CO2 emissions reduced from e-waste recycling initiatives. Our remote-first culture for corporate employees has also helped further reduce our carbon footprint.
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| | Improving waste management practices 11,5333,807 pounds of e-waste diverted from landfills. We use compostable materials in our office pantries and removed single-use plastics from office vending machines.
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| | Using less paper Decreased paper waste and improved the member experience by processing over 95 percent98% of our loan applications electronically. |
| | Increasing energy efficiency Switched to LED lighting and installed dimming features to reduce energy consumption in our San Carlos headquarters and Frisco office. |
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Ethics, Conduct, and Culture Governance over Culture At Oportun, we review and monitor our enterprise risks through our robust compliance management system. We prioritize those areas overseen by our audit and risk committee and credit risk and finance committee and actively monitor for new and evolving risks. Compliance risk assessments and audits are a key component of our risk management process and are conducted periodically based on the degree of risk exposure. These assessments inform our risk management strategies, which in turn are evaluated and implemented in the day-to-day execution of our business decisions. Fundamental to our approach to risk management is ensuring we adhere to all local, national and international legal and regulatory requirements. Programs and Efforts that Embed Culture We seek to create a culture that promotes honesty, fairness, and integrity in all of our interactions. One of the primary ways we reinforce this commitment is through compliance training. All of our employees are required to participate in our training programs, which include among other topics, expected ethical and professional behaviors. In addition, each of our employees must sign and acknowledge our Code of Business Conduct annually. We also offer role-specific regulatory training on a cadence from every six-months to a year to ensure our team members are aware of the current regulatory and compliance procedures and policies. The following are a few examples of our programs and associated efforts to set, reinforce, and embed our culture at Oportun: Communications and awareness efforts concerning our mission and core values. Embedding our company values into key aspects of our employee life cycle, such as hiring and performance reviews. Employee trainings on key culture-related themes, including cultural awareness, harassment and discrimination prevention, and workplace incident management. | | | | | 22 |
Code of Business Conduct and Corporate Governance Guidelines Our Board has adopted a Code of Business Conduct and Corporate Governance Guidelines that apply to all of our employees, officers and directors, including those officers responsible for financial reporting. The Code of Business Conduct and Corporate Governance Guidelines are available on our investor relations website (http://investor.oportun.com/corporate-governance/governance-overviewgovernance-documents). We intend to disclose any amendments to the Code of Business Conduct, or any waivers of its requirements, on our website to the extent required by the applicable rules and stock exchange requirements. Whistleblower Hotline Oportun expects employees to raise concerns or questions regarding ethics, discrimination or harassment matters, and to promptly report suspected violations of laws or breaches of our policies. We offer several channels by which employees may report such matters or suspected violations, including violations of our Code of Business Conduct, sales practices, accounting, or auditing matters, or other violations of law. We protect those who come forward with our accompanying Non-retaliation Policy. We provideThese channels include a global whistleblowerdedicated email address and confidential reporting hotline a toll-free number that is staffed by live operators managed by a third-party vendor who can connect to translators to accommodate multiple languages. Calls to the whistleblower hotline are received by a third-party vendor, located in the United States. Any reported activity is investigated internally under the direction and oversight of our audit and risk committee. We protect those who come forward with our accompanying Non-retaliation Policy. Stockholder Communications with our Board Stockholders of the Company wishing to communicate with our Board or an individual director may send a written communication to our Board or such director c/o Oportun Financial Corporation, 2 Circle Star Way, San Carlos, CA 94070 Attn: Corporate Secretary. Written communications may be submitted anonymously or confidentially and may, at the discretion of the person submitting the communication, indicate whether the person is a stockholder or other interested party. Alternatively, stockholders may submit communications to our Board through our investor relations website at https://investor.oportun.com/contact. | | |
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The Company’s Corporate Secretary will review each communication to determine whether it is appropriate for presentation to our Board or such director. Examples of inappropriate communications include product complaints, product inquiries, new product suggestions, resumes or job inquiries, surveys, solicitations or advertisements, or hostile communications. Communications determined by the Corporate Secretary to be appropriate for presentation to our Board or such director will be submitted to our Board or such director on a periodic basis. Communications determined by the Corporate Secretary to be inappropriate for presentation will still be made available to any non-management director upon such director’s request. Role of our Board in Risk Oversight The audit and risk committee and the credit risk and finance committee of our Board are primarily responsible for overseeing our risk management processes on behalf of our Board. The audit and risk committee and the credit risk and finance committee receive reports from management and our internal risk committees on at least a quarterly basis regarding our assessment of risks. In addition, each of the audit and risk committee and the credit risk and finance committee reports regularly to our Board, which also considers our risk profile. The audit and risk committee, credit risk and finance committee and our Board focus on the most significant risks we face and our general risk management strategies. While our Board oversees our risk management, management is responsible for day-to-day risk management processes. Our Board expects management and our internal risk committees to consider risk and risk management in each business decision, to proactively develop and monitor risk management strategies and processes for day-to-day activities and to effectively implement risk management strategies adopted by the audit and risk committee, credit risk and finance committee and our Board. We believe this division of responsibilities is the most effective approach for addressing the risks we face and that the | | | | | 23 |
leadership structure of our Board, which also emphasizes the independence of our Board in its oversight of its business and affairs, supports this approach. Cybersecurity Risk Oversight The audit and risk committee oversees the Company’s cyber risk management program. The audit and risk committee receives quarterly updates on cybersecurity and information systems from management, or more frequently if circumstances warrant, including on topics related to information security, data privacy and cyber risks and mitigation strategies. We have developed a program that is designed to protect and preserve the confidentiality, integrity, and continued availability of information owned by, or in the care of, the Company. This program includes a cyber incident response plan that provides controls and procedures for timely and accurate reporting of material cybersecurity incidents and the maintenance by the Company of insurance coverage to defray the cost in the event of an information security breach. If a material breach were to occur, we would update the audit and risk committee in accordance with our incident response plan. Our management team ensures there is a culture of security awareness by raising its profile in corporate communications, training efforts, and routine roundtables with department leaders. In addition, our employees participate in annual cybersecurity training. In the last three years, the expenses we have incurred from information security breach incidences were immaterial, and none of which related to penalties or settlements. Role of our Board in Leadership Development The Board oversees and is regularly updated on the company’s leadership development and talent management strategies, which are designed to attract, develop, and retain business leaders who can drive strategic corporate and financial objectives and enhance long-term stockholder value. The Board formally reviews and discusses management development and succession plans for the CEO and the executive team, including individual executive transitions as the need arises over the course of each year. The reviews include an assessment of senior executives and their potential as successor to the CEO. The Board has adopted procedures to facilitate the prompt election of a successor in the event of the CEO’s sudden incapacity or departure. Stock Ownership Guidelines The Board has adopted stock ownership guidelines to align the interests of our directors and executive officers with those of our stockholders. The guidelines provide that non-employee directors should each own Oportun stock with a value of at least five times the annual base retainer for non-employee directors. Oportun’s CEO should own Oportun stock with a value of at least six times his annual base salary. Each Section 16 officer should own Oportun stock with a value of at least three times their annual base salary. Unearned performance awards and unexercised options (or portions thereof) are not included for purposes of satisfying the applicable ownership requirement. | | | 24
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Board of Directors Biographies The following is biographical and certain other information for each of our directors who are nominated for election to our Board and for our continuing directors as of April 18, 2022:17, 2023: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Age | | | Class | | | Position | | Director Since | | | Current Term Expires | | | Expiration of Term for Which Nominated | | | | | | | | | Nominees for Director | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Carl Pascarella (1)(4)(5) | | | 79 | | | | III | | | Director | | | 2010 | | | | 2022 | | | | 2025 | | | | | | | | | Raul Vazquez | | | 50 | | | | III | | | Director | | | 2012 | | | | 2022 | | | | 2025 | | | | | | | | | R. Neil Williams (3)(4) | | | 69 | | | | III | | | Director | | | 2017 | | | | 2022 | | | | 2025 | | | | | | | | | Continuing Directors | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Jo Ann Barefoot (3)(4) | | | 72 | | | | I | | | Director | | | 2016 | | | | 2023 | | | | — | | | | | | | | | Ginny Lee (1)(2) | | | 55 | | | | I | | | Director | | | 2021 | | | | 2023 | | | | — | | | | | | | | | David Strohm (1)(2) | | | 73 | | | | I | | | Director | | | 2007 | | | | 2023 | | | | — | | | | | | | | | Frederic Welts (1)(2) | | | 69 | | | | I | | | Director | | | 2021 | | | | 2023 | | | | — | | | | | | | | | Aida M. Alvarez (1)(2) | | | 72 | | | | II | | | Director | | | 2011 | | | | 2024 | | | | — | | | | | | | | | Roy Banks (4) | | | 55 | | | | II | | | Director | | | 2021 | | | | 2024 | | | | — | | | | | | | | | Louis P. Miramontes (2)(3) | | | 67 | | | | II | | | Director | | | 2014 | | | | 2024 | | | | — | | | | | | | | | Sandra A. Smith (3)(4) | | | 51 | | | | II | | | Director | | | 2021 | | | | 2024 | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Age | | | Class | | | Position | | Director Since | | | Current Term Expires | | | Expiration of Term for Which Nominated | | | | | | | | | Nominees for Director | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Jo Ann Barefoot (1)(2) | | | 73 | | | | I | | | Director | | | 2016 | | | | 2023 | | | | 2026 | | | | | | | | | Sandra A. Smith (1)(2) | | | 52 | | | | I | | | Director | | | 2021 | | | | 2023 | | | | 2026 | | | | | | | | | Continuing Directors | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Roy Banks (2)(3) | | | 56 | | | | II | | | Director | | | 2021 | | | | 2024 | | | | — | | | | | | | | | Ginny Lee (3)(4) | | | 56 | | | | II | | | Director | | | 2021 | | | | 2024 | | | | — | | | | | | | | | Louis P. Miramontes (1)(4) | | | 68 | | | | II | | | Director | | | 2014 | | | | 2024 | | | | — | | | | | | | | | Carl Pascarella (2)(3)(5) | | | 80 | | | | III | | | Director | | | 2010 | | | | 2025 | | | | — | | | | | | | | | Raul Vazquez | | | 51 | | | | III | | | Director | | | 2012 | | | | 2025 | | | | — | | | | | | | | | R. Neil Williams (1)(2) | | | 70 | | | | III | | | Director | | | 2017 | | | | 2025 | | | | — | | | | | | | | | Non-Continuing Directors | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | David Strohm (4)(6) | | | 74 | | | | I | | | Director | | | 2007 | | | | 2023 | | | | 2026 | | | | | | | | | Frederic Welts (3)(4)(6) | | | 70 | | | | I | | | Director | | | 2021 | | | | 2023 | | | | 2026 | |
(1) | Member of the audit and risk committee. |
(2) | Member of the credit risk and finance committee. |
(3) | Member of the compensation and leadership committee. |
(2)(4) | Member of the nominating, governance and social responsibility committee. |
(3)(5) | Member of the audit and risk committee.Lead Independent Director.
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(4)(6) | MemberThe current term of Mr. Strohm and Mr. Welts will expire at the credit riskAnnual Meeting. Our Board thanks Mr. Strohm and finance committee.
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(5) | Lead independent director.Mr. Welts for their distinguished service as directors and significant contributions to Oportun.
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Director Nominees Jo Ann Barefoot has served as a member of our Board since October 2016. Ms. Barefoot is CEO & Founder of AIR—the Alliance for Innovative Regulation, Cofounder of Hummingbird RegTech, CEO of Barefoot Innovation Group and host of the podcast show Barefoot Innovation. Ms. Barefoot was a Senior Fellow at the John F. Kennedy School of Government’s Mossovar-Rahmani Center for Business & Government at Harvard University from July 2015 to June 2017. Ms. Barefoot also serves as a consultant to a number of private consumer finance companies and invests and advises fintech startups. She serves on the board of FinRegLab and on advisory bodies for the Financial Industry Regulatory Authority (FINRA), the Milken Institute FinTech, the California Blockchain Working Group, and previously served on the Consumer Advisory Board of the Consumer Financial Protection Bureau and the National Foundation for Credit Counseling. Ms. Barefoot previously served as chair of the board of the Financial Health Network, as the Deputy Comptroller of the Currency, staff of the U.S. Senate Committee on Banking, Housing and Urban Affairs, as Co-Chair of the consulting firm Treliant Risk Advisors, as a Partner and Managing Director at KPMG Consulting and as Director of Mortgage Finance for the National Association of Realtors. Ms. Barefoot received a B.A. in English from the University of Michigan. We believe that Ms. Barefoot’s deep understanding of consumer finance and experience in government and community service provide her with a uniquely diverse perspective that benefits our Board. | | | | | 25 |
Sandra A. Smith has served as a member of our Board since September 2021. From 2018 to April 2021, Ms. Smith served as the Chief Financial Officer of Segment.io (“Segment”), which was acquired by Twilio Inc (“Twilio”). Before joining Segment, Ms. Smith served as the Vice President, Finance at Twilio, from 2013 to 2018, and in various roles at Akamai Technologies, Inc. from 2003 to 2013. Ms. Smith currently serves as a director at several private companies. Ms. Smith holds a B.F.A. from the University of Michigan, an M.B.A. from Boston College Carroll Graduate School of Management and a J.D. from Boston College Law School. We believe that Ms. Smith is qualified to serve on our Board due to her broad operational experience at high-tech companies and significant leadership experience in the areas of finance, accounting, and audit oversight. Continuing Directors Roy Banks has served as a member of our Board since September 2021. Mr. Banks previously served as Chief Executive Officer and director of Weave Communications from December 2020 to August 2022. Prior to joining Weave Communications, he served as a CEO Partner of Tritium Partners from July 2019 to August 2020. Prior to that he was the President of the LoadPay Business Unit from July 2018 to March 2019 and a board member for Truckstop from May 2017 to March 2019. He also served as the CEO of Network Merchants Inc. from May 2014 to May 2018. Mr. Banks also currently serves as a Venture Partner for Pelion Venture Partners. Mr. Banks graduated from Utah Valley University with a B.A. in Business Management. We believe Mr. Banks’ broad experience with high-tech and financial transaction processing, and leadership experience at fast-growing companies enables him to make valuable contributions to our Board. Ginny Lee has served as a member of our Board since September 2021. From December 2016 to June 2021, Ms. Lee served as the President and Chief Operating Officer of Khan Academy, a non-profit online education technology organization. Prior to Khan Academy, Ms. Lee spent more than 17 years at Intuit where she held multiple senior operational and technical roles, including Senior Vice President and General Manager of Intuit’s Employee Management Solutions Division, as well as Chief Information Officer. She currently serves as an advisor and director for several private companies and as a member of the Marshall University Board of Governors. Ms. Lee received dual baccalaureate degrees in Business Economics and Organizational Behavior and Management from Brown University and a M.B.A. from the Stanford Graduate School of Business. We believe that Ms. Lee’s strong background of business, technology leadership roles and experience bringing products to market enable her to make valuable contributions to our Board. Louis P. Miramontes has served as a member of our Board since October 2014. Mr. Miramontes is a CPA and financial executive. He was a senior partner at KPMG LLP, a public accounting firm, from 1976 to September 2014, where he served in leadership functions, including Managing Partner of the KPMG San Francisco office and Senior Partner KPMG’s Latin American Region. Mr. Miramontes was also an audit partner directly involved with providing audit services to public and private companies, which included working with client boards of directors and audit committees regarding financial reporting, auditing matters, SEC compliance and Sarbanes-Oxley regulations. Mr. Miramontes currently serves on the board of directors of Lithia Motors, Inc., and Rite Aid Corporation. Mr. Miramontes received a B.S. in Business Administration from California State University, East Bay, and he is a Certified Public Accountant in the State of California. We believe Mr. Miramontes is qualified to serve on our Board due to his professional experience and deep audit and financial reporting expertise. Carl Pascarella has served as a member of our Board since March 2010. Mr. Pascarella is an Executive Advisor at TPG Capital, a leading global private equity firm, and has served in that capacity since August 2005. Mr. Pascarella joined TPG after retiring in 2005 from Visa U.S.A., Inc., a financial services company, where he served as the President and Chief Executive Officer for 12 years. Mr. Pascarella also served as President and CEO of Visa International’s Asia-Pacific Region and Director of the Asia-Pacific Regional Board. Prior to joining Visa International, Mr. Pascarella held positions as Vice President of the International Division of Crocker National Bank and Vice President, Metropolitan Banking, at Bankers Trust Company. We believe Mr. Pascarella’s leadership background as well as his extensive management experience in our industry enable him to make valuable contributions to our Board. | | | | | 26 |
Raul Vazquez has served as our Chief Executive Officer and as a member of our Board since April 2012. Prior to joining Oportun, Mr. Vazquez served in various positions since 2002 at Walmart.com and Walmart Inc., including three years as Chief Executive Officer of Walmart.com. Mr. Vazquez has served as member of the board of directors of Intuit Inc. since May 2016 and also serves on the board of directors of the National Association for Latino Community Asset Builders (NALCAB). He previously served as a director of Staples, Inc. from 2013 to 2016. In addition, Mr. Vazquez has served as a member of the Consumer Advisory Board of the CFPB and the Community Advisory Council of the Federal Reserve Board, where he also served as Chair. Mr. Vazquez received a B.S. and M.S. in Industrial Engineering from Stanford University and an M.B.A. from the Wharton Business School at the University of Pennsylvania. We believe Mr. Vazquez’ experience in our industry, his role as our Chief Executive Officer, and his extensive insight to the Company enable him to make valuable contributions to our Board. | | |
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R. Neil Williams has served as a member of our Board since November 2017. Mr. Williams has served as Executive Vice President and Chief Financial Officer at Intuit Inc. from January 2008 to February 2018. Prior to joining Intuit, from April 2001 to September 2007, Mr. Williams served as Executive Vice President of Visa U.S.A., Inc. and from November 2004 to September 2007, he served as Chief Financial Officer. During the same period, Mr. Williams held the dual role of Chief Financial Officer for Inovant LLC, Visa’s global IT organization. He has been an independent director of RingCentral, Inc. since March 2012 and previously served on the board of directors of Amyris, Inc. from May 2013 to March 2020. His previous banking experience includes senior financial positions at commercial banks in the Southern and Midwestern regions of the United States. Mr. Williams, a certified public accountant, received his bachelor’s degree in business administration from the University of Southern Mississippi. We believe that Mr. Williams’s professional experience in the areas of finance, accounting, and audit oversight enables him to make valuable contributions to our Board. ContinuingNon-Continuing Directors
The Honorable Aida M. Alvarez has served as a member of our Board since August 2011. In addition to serving on our Board, Ms. Alvarez has served as member of the board of directors of Fastly Inc. since 2019, HP Inc. since 2016 and K12 Inc. since 2017. Ms. Alvarez was the former Administrator of the U.S. Small Business Administration and was a member of President Clinton’s Cabinet from 1997 to 2001. From 1993 to 1997, Ms. Alvarez was the founding Director of the Office of Federal Housing Enterprise Oversight. Prior to 1993, she was a vice president in public finance at First Boston Corporation, an investment bank, and Bear Stearns & Co., Inc., an investment bank. She also previously served on the board of directors of Walmart Inc., Zoosk, Inc., PacifiCare Health Systems (now part of United Health), Union Bank, N.A., and UnionBanCal Corporation. Ms. Alvarez received a B.A. in English literature from Harvard College, as well as honorary doctorates from Bethany College, Iona College, Mercy College and the Inter-American University of Puerto Rico. Ms. Alvarez is the founding Chair of the Latino Community Foundation. Ms. Alvarez has also served on the Harvard Board of Overseers. We believe Ms. Alvarez’s extensive experience in government and public service, investment banking and finance, and her experience serving as a board and committee member for other public companies, enables her to make valuable contributions to our Board.
Roy Banks has served as a member of our Board since September 2021. Mr. Banks has served as Chief Executive Officer and director of Weave Communications since December 2020. Prior to joining Weave Communications, he served as a CEO Partner of Tritium Partners from July 2019 to August 2020. Prior to that he was the President of the LoadPay Business Unit from July 2018 to March 2019 and a board member for Truckstop from May 2017 to March 2019. He also served as the CEO of Network Merchants Inc. from May 2014 to May 2018. In addition to his role as Chief Executive Officer and director of Weave Communications, Mr. Banks also currently serves as a Venture Partner for Pelion Venture Partners, director for Complete Merchant Services and director of TEZ Parking Technologies. Mr. Banks graduated from Utah Valley University with a B.A. in Business Management. We believe Mr. Banks’ broad experience with high-tech and financial transaction processing, and leadership experience at fast-growing companies enables him to make valuable contributions to our Board.
Jo Ann Barefoot has served as a member of our Board since October 2016. Ms. Barefoot is CEO & Founder of AIR—the Alliance for Innovative Regulation, Cofounder of Hummingbird RegTech, CEO of Barefoot Innovation Group and host of the podcast show Barefoot Innovation. Ms. Barefoot was a Senior Fellow at the John F. Kennedy School of Government’s Mossovar-Rahmani Center for Business & Government at Harvard University from July 2015 to June 2017. Ms. Barefoot also serves as a consultant to a number of private consumer finance companies and invests and advises fintech startups. She serves on the board of the National Foundation for Credit Counseling, the Milken Institute FinTech Advisory Committee, the California Blockchain Working Group Advisory Board, and previously served on the Consumer Advisory Board of the Consumer Financial Protection Bureau. Ms. Barefoot previously served as chair of the board of the Financial Health Network, as the Deputy Comptroller of the Currency, staff of the U.S. Senate Committee on Banking, Housing and Urban Affairs, as Co-Chair of the consulting firm Treliant Risk Advisors, as a Partner and Managing Director at KPMG Consulting and as Director of Mortgage Finance for the National Association of Realtors. Ms. Barefoot received a B.A. in English from the University of Michigan. We believe that Ms. Barefoot’s deep understanding of consumer finance and experience in government and community service provide her with a uniquely diverse perspective that benefits our Board.
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Ginny Lee has served as a member of our Board since September 2021. From December 2016 to June 2021, Ms. Lee served as the President and Chief Operating Officer of Khan Academy, a non-profit online education technology organization. Prior to Khan Academy, Ms. Lee spent more than 17 years at Intuit where she held multiple senior operational and technical roles, including Senior Vice President and General Manager of Intuit’s Employee Management Solutions Division, as well as Chief Information Officer. She currently serves as an advisor and director for several private companies. Ms. Lee received dual baccalaureate degrees in Business Economics and Organizational Behavior and Management from Brown University and a M.B.A. from the Stanford Graduate School of Business. We believe that Ms. Lee’s strong background of business, technology leadership roles and experience bringing products to market enable her to make valuable contributions to our Board.
Louis P. Miramontes has served as a member of our Board since October 2014. Mr. Miramontes is a CPA and financial executive. He was a senior partner at KPMG LLP, a public accounting firm, from 1986 to September 2014, where he served in leadership functions, including Managing Partner of the KPMG San Francisco office and Senior Partner KPMG’s Latin American Region. Mr. Miramontes was also an audit partner directly involved with providing audit services to public and private companies, which included working with client boards of directors and audit committees regarding financial reporting, auditing matters, SEC compliance and Sarbanes-Oxley regulations. Mr. Miramontes currently serves on the board of directors of Lithia Motors, Inc., and Rite Aid Corporation. Mr. Miramontes received a B.S. in Business Administration from California State University, East Bay, and he is a Certified Public Accountant in the State of California. We believe Mr. Miramontes is qualified to serve on our Board due to his professional experience and deep audit and financial reporting expertise.
Sandra A. Smith has served as a member of our Board since September 2021. From 2018 to April 2021, Ms. Smith served as the Chief Financial Officer of Segment.io (“Segment”), which was acquired by Twilio Inc (“Twilio”). Before joining Segment, Ms. Smith served as the Vice President, Finance at Twilio, from 2013 to 2018, and in various roles at Akamai Technologies, Inc. from 2003 to 2013. Ms. Smith currently serves as a director at several private companies. Ms. Smith holds a B.F.A. from the University of Michigan, an M.B.A. from Boston College Carroll Graduate School of Management and a J.D. from Boston College Law School. We believe that Ms. Smith is qualified to serve on our Board due to her broad operational experience at high-tech companies and significant leadership experience in the areas of finance, accounting, and audit oversight.
David Strohm has served as a member of our Board since February 2007. Mr. Strohm has been affiliated with Greylock Partners, a venture capital firm, since 1980, where he has served as a Partner since January 2001, and previously served as a General Partner from 1983 to 2001. Mr. Strohm currently serves as a director of several private companies. Mr. Strohm was previously also a director of DoubleClick, Inc. from 1997 to 2005, Internet Security Systems, Inc. from 1996 to 2006, SuccessFactors, Inc. from 2001 to 2010, EMC Corporation from 2003 to October 2015 and VMware, Inc. from 2007 to October 2015. Mr. Strohm received a B.A. from Dartmouth College and an M.B.A. from Harvard Business School. We believe that Mr. Strohm’s extensive experience as an investment professional in our industry and as a director of various companies, many of which are publicly traded, enables him to make valuable contributions to our Board. Frederic Welts has served as a member of our Board since September 2021. From October 2011 to April 2021, Mr. Welts served as President and Chief Operating Officer of the Golden State Warriors. Prior to joining the Warriors, Mr. Welts spent nine years with the Phoenix Suns, serving the organization as President and Chief Executive Officer for the last two seasons. Prior to joining the Suns, Mr. Welts served at the NBA league office in New York from 1982-1999, where he ascended through the ranks to eventually become the league’s third-in-command as the Executive Vice President, Chief Marketing Officer and President of NBA Properties. Mr. Welts currently is a board member of GoPro Inc., the Bay Area Council and the Warriors Community Foundation, and serves on the NBA’s Team Advisory Committee and Global Inclusion Council. Mr. Welts received a B.A. in Communications from the University of Washington. We believe Mr. Welts’s extensive executive experience, marketing background, and active community involvement, enable him to make valuable contributions to our Board. | | |
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Non-Employee Director Compensation We compensate non-employee directors for their service on our Board with a combination of cash and equity awards, the amounts of which are commensurate with their role and involvement, and consistent with peer company practices.taking into consideration a competitive market analysis performed by CODA Advisors. Directors may be reimbursed for travel, food, lodging and other expenses directly related to their activities as directors. Directors are also entitled to the protection provided by their indemnification agreements and the indemnification provisions as described in our amended and restated certificate of incorporation and amended and restated bylaws. | | | | | 27 |
The compensation and leadership committee, which is comprised solely of independent directors, has the primary responsibility for reviewing and recommending to the Board the type and amount of compensation as well as changes to the compensation to be paid or awarded to non-employee directors, including any consulting, retainer, boardBoard meeting, committee and committee chair fees and equity awards. Cash Compensation Each non-employee director receives an annual cash retainer for his or her service on the Board, as well as additional cash retainers if he or she serves as the lead independent director,Lead Independent Director, on a committee or as the chair of a committee. For new directors, these amounts are prorated for partial-year service based on the date of election to the Board. All cash payments to non-employee directors who served in the relevant capacity at any point during the immediately preceding prior fiscal quarter will be paid quarterly in arrears on a prorated basis. A non-employee director who served in the relevant capacity during only a portion of the prior fiscal quarter will receive a pro-ratedprorated payment of the quarterly payment of the applicable cash retainer. The following table lists the cash retainer amounts in effect during fiscal year 2021.2022. | | | | | | | Position | | Annual Cash Retainer ($) | | | | Board member | | | 40,000 | | | | Lead independent directorIndependent Director | | | 25,000 | | | | Audit and risk committee chair | | | 20,000 | | | | Audit and risk committee member | | | 10,000 | | | | Other committee chair | | | 15,000 | | | | Other committee member | | | 7,500 | |
Non-employee directors may elect to receive a fixed percent up to 100% of their cash compensation earned for boardBoard or committee service in the form of fully vested stock options or restricted stock units (“RSUs”). TheAt the end of 2021, directors were allowed to elect to receive their retainer compensation for 2022 in the form of RSUs or cash. In 2022, for those directors who made such an election, the number of shares underlying such stock options or RSUs will be calculated by dividing the amount of cash compensation electedearned by the non-employee director by the grant date fair value per share (which means for stock options, the Black-Scholes value or binomial-lattice pricing model and for RSUs, the closing stock price on each grant date and rounded up to the grant date). At the end of 2021, directors were allowed to choose to receive their compensation for 2022 in the form of stock options, RSUs or cash.nearest full share. Equity Compensation Each then-serving non-employee director received an annual equity award of RSUs with a value of $125,000 and the lead independent directorLead Independent Director received an additional equity award of RSUs with a value of $31,250 immediately after the 20212022 annual meeting. The number of shares subject to the RSUs was determined based on the annual equity award value divided by the closing stock price on the grant date and rounded up to the nearest full share, resulting in an award of RSUs covering 6,01012,551 shares of our common stock for each non-employee director, with the lead independent directorLead Independent Director receiving an additional award of RSUs covering 1,5033,137 shares of our common stock. The RSU awards vestedvest upon the satisfaction of a one-yearservice-based vesting schedule, that lapsed over the course of a year, commencing June 2021,2022, subject to the non-employee director continuing to provide services to us through the applicable vesting date. A non-employee | | | 28
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director who is newly appointed to the Board other than in connection with an annual meeting of shareholdersstockholders will receive a grant of RSUs upon appointment (an “Initial Director Award”). The number of RSUsshares subject to each Initial Director Award is determined in the same manner as described above for Annual Director Awards, but the Initial Director Award is pro-ratedprorated based on the portion of the time period that has passedremaining in the one-year period since the last annual meeting service until the 2022 Annual Meeting. The following table lists all outstanding equity awards held by our non-employee directors as of December 31, 2021:meeting.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Director | | | | | | | | | | | | | | Stock Awards (#) | | | Stock Options (#) | | | | | | | | | Aida M. Alvarez | | | | | | | | | | | | | | | | | | | 3,005 | | | | 18,181 | | | | | | | | | Roy Banks | | | | | | | | | | | | | | | | | | | 2,648 | | | | — | | | | | | | | | Jo Ann Barefoot | | | | | | | | | | | | | | | | | | | 3,005 | | | | 18,181 | | | | | | | | | Ginny Lee | | | | | | | | | | | | | | | | | | | 2,648 | | | | — | | | | | | | | | Louis P. Miramontes | | | | | | | | | | | | | | | | | | | 3,005 | | | | 18,181 | | | | | | | | | Carl Pascarella | | | | | | | | | | | | | | | | | | | 3,757 | | | | 8,522 | | | | | | | | | Sandra A. Smith | | | | | | | | | | | | | | | | | | | 2,648 | | | | — | | | | | | | | | David Strohm | | | | | | | | | | | | | | | | | | | 3,005 | | | | — | | | | | | | | | Frederic Welts | | | | | | | | | | | | | | | | | | | 2,648 | | | | — | | | | | | | | | R. Neil Williams | | | | | | | | | | | | | | | | | | | 3,005 | | | | 18,181 | |
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Non-Employee Director Compensation Table for Fiscal Year 2022 The following table provides information regarding all compensation awarded to, earned by or paid to our non-employee directors for the year ended December 31, 2021:2022: | | | | Director | | | | | | | | Fees Earned or Paid in Cash ($) | | Stock Awards (1) ($) | | Total ($) | | | | | | | | Fees Earned or Paid in Cash ($) | | Stock Awards (1) ($) | | Total ($) | | | Aida M. Alvarez(2) | | | | | | | | | 62,500 | | | | 125,008 | | | | 187,508 | | | | | | | | | | 52,140 | | | | 93,750 | | | | 145,890 | | | Roy Banks (2) | | | | | | | | | 15,833 | | | | 95,900 | | | | 111,733 | | | | | | | | | | 47,500 | | | | 125,008 | | | | 172,508 | | | Jo Ann Barefoot | | | | | | | | | 57,500 | | | | 125,008 | | | | 182,508 | | | | | | | | | | 57,500 | | | | 125,008 | | | | 182,508 | | | Ginny Lee (2) | | | | | | | | | 18,333 | | | | 95,900 | | | | 114,233 | | | | | | | | | | 56,243 | | | | 125,008 | | | | 181,251 | | | Louis P. Miramontes | | | | | | | | | 59,250 | | | | 125,008 | | | | 184,258 | | | | | | | | | | 57,500 | | | | 125,008 | | | | 182,508 | | | Carl Pascarella | | | | | | | | | 86,187 | | | | 156,270 | | | | 242,457 | | | | | | | | | | 81,228 | | | | 156,252 | | | | 237,480 | | | Sandra A. Smith (2) | | | | | | | | | 19,167 | | | | 95,900 | | | | 115,067 | | | | | | | | | | 63,695 | | | | 125,008 | | | | 188,703 | | | David Strohm | | | | | | | | | 67,063 | | | | 125,008 | | | | 192,071 | | | | | | | | | | 56,227 | | | | 125,008 | | | | 181,235 | | | Frederic Welts (2) | | | | | | | | | 18,333 | | | | 95,900 | | | | 114,233 | | | | | | | | | | 61,196 | | | | 125,008 | | | | 186,204 | | | R. Neil Williams | | | | | | | | | 67,063 | | | | 125,008 | | | | 192,071 | | | | | | | | | | 67,500 | | | | 125,008 | | | | 192,508 | |
(1) | This column reflects the aggregate grant date fair value of the stock options and RSUs granted as annual equity awards for Board service as described above (or in the case of Mr. Pascarella, such annual equity award plus an additional annual equity award for his service as Lead Independent Director) measured pursuant to FASB ASC 718, without regard to forfeitures. The assumptions used in calculating the grant date fair value of these awards are set forth in Note 2 and Note 1312 to our Notes to the Consolidated Financial Statements included on our Annual Report on Form 10-K filed March 1, 2022.14, 2023. These amounts do not reflect the actual economic value that may be realized by the non-employee director. |
(2) | The director joined our Board in September 2021 and received a pro-rated equity award for service until the 2022 Annual Meeting.Ms. Alvarez resigned on November 1, 2022.
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The following table lists all outstanding equity awards held by our non-employee directors as of December 31, 2022: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Director | | | | | | | | | | | | | | Stock Awards (#) | | | Stock Options (#) | | | | | | | | | Aida M. Alvarez (1) | | | | | | | | | | | | | | | | | | | — | | | | — | | | | | | | | | Roy Banks | | | | | | | | | | | | | | | | | | | 6,276 | | | | — | | | | | | | | | Jo Ann Barefoot | | | | | | | | | | | | | | | | | | | 6,276 | | | | 18,181 | | | | | | | | | Ginny Lee | | | | | | | | | | | | | | | | | | | 6,276 | | | | — | | | | | | | | | Louis P. Miramontes | | | | | | | | | | | | | | | | | | | 6,276 | | | | 18,181 | | | | | | | | | Carl Pascarella | | | | | | | | | | | | | | | | | | | 7,844 | | | | — | | | | | | | | | Sandra A. Smith | | | | | | | | | | | | | | | | | | | 6,276 | | | | — | | | | | | | | | David Strohm | | | | | | | | | | | | | | | | | | | 6,276 | | | | — | | | | | | | | | Frederic Welts | | | | | | | | | | | | | | | | | | | 6,276 | | | | — | | | | | | | | | R. Neil Williams | | | | | | | | | | | | | | | | | | | 6,276 | | | | 18,181 | |
(1) | Ms. Alvarez resigned on November 1, 2022. |
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Report of the Audit and Risk Committee The information contained in this report of the audit and risk committee shall not be deemed to be “soliciting material,” “filed” with the SEC, subject to Regulations 14A or 14C of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or subject to the liabilities of Section 18 of the Exchange Act. No portion of this audit committee report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, through any general statement incorporating by reference in its entirety the proxy statement in which this report appears, except to the extent that the Company specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed filed under either the Securities Act or the Exchange Act. This report is submitted by the audit and risk committee of the Board. The audit and risk committee consists of the directors whose names appear below. None of the members of the audit and risk committee is an officer or employee of the Company, and our Board has determined that each member of the audit and risk committee is “independent” for audit committee purposes as that term is defined under Rule 10A-3 of the Exchange Act and the applicable Nasdaq rules. Each member of the audit and risk committee meets the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq. The audit and risk committee’s general role is to assist the Board in monitoring the Company’s financial reporting process and related matters and risk management and related matters. The audit and risk committee’s specific responsibilities are set forth in its charter. A copy of the charter is available on our investor relations website: https://investor.oportun.com/corporate-governance/governance-overviewgovernance-documents. The audit and risk committee has reviewed the Company’s consolidated financial statements for its fiscal year ended December 31, 20212022 and met with its management team, as well as with representatives of Deloitte & Touche LLP, the Company’s independent registered public accounting firm, to discuss the consolidated financial statements and management’s assessment and Deloitte & Touche LLP’s evaluation of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021.2022. The audit and risk committee also discussed with members of Deloitte & Touche LLP the matters required to be discussed by the applicable requirements of the PCAOB. In addition, the audit and risk committee received the written disclosures and the letter from Deloitte & Touche LLP required by applicable requirements of the PCAOB regarding the independent auditor’s communications with the audit and risk committee concerning independence and discussed with members of Deloitte & Touche LLP its independence. Based on these discussions, the financial statement review and other matters it deemed relevant, the audit and risk committee recommended to our Board that the Company’s audited consolidated financial statements for its fiscal year ended December 31, 20212022 be included in its Annual Report on Form 10-K for its 20212022 fiscal year. Respectfully submitted by the members of the audit and risk committee of the Board: R. Neil Williams (Chair) Jo Ann Barefoot Louis P. Miramontes Sandra A. Smith | | | 30
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters The following table sets forth certain information with respect to the beneficial ownership of our common stock as of April 18, 202217, 2023 for: each person, or group of affiliated persons, who beneficially owned more than 5% of our common stock; each of our named executive officers; each of our directors and nominees for director; and all of our current executive officers and directors as a group. We have determined beneficial ownership in accordance with the rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other purpose. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to community property laws where applicable. We have based our calculation of the percentage of beneficial ownership on 32,807,00233,884,346 shares of our common stock outstanding as of April 18, 2022.17, 2023. We have deemed shares of our common stock subject to stock options or warrants that are currently exercisable or exercisable and RSUs that will vest within 60 days after April 18, 2022,17, 2023, to be outstanding and to be beneficially owned by the person holding the stock option or warrant for the purpose of computing the percentage ownership of that person. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person. | | |
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Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Oportun Financial Corporation, 2 Circle Star Way, San Carlos, CA 94070. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name of Beneficial Owner | | | | | | | | Number of Shares Beneficially Owned (1) | | Percentage of Shares Beneficially Owned | | | | | | | 5% Stockholders: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Entities affiliated with Blackrock (2) | | | | | | | | | | | | | | | | | | | 2,250,564 | | | | | 6.9 | % | | | | | | | Institutional Venture Partners XIV, L.P. (3) | | | | | | | | | | | | | | | | | | | 3,408,691 | | | | | 10.4 | % | | | | | | | Kayne Anderson Rudnick Investment Management LLC (4) | | | | | | | | | | | | | | | | | | | 3,343,544 | | | | | 10.2 | % | | | | | | | Ashford Capital Management (5) | | | | | | | | | | | | | | | | | | | 1,693,764 | | | | | 5.2 | % | | | | | | | Entities affiliated with Wellington Management Group LLP (6) | | | | | | | | | | | | | | | | | | | 2,583,972 | | | | | 7.9 | % | | | | | | | Directors and Named Executive Officers: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Raul Vazquez (7) | | | | | | | | | | | | | | | | | | | | | | | | 2.4 | % | | | | | | | Jonathan Coblentz (8) | | | | | | | | | | | | | | | | | | | | | | | | 0.7 | % | | | | | | | Patrick Kirscht (9) | | | | | | | | | | | | | | | | | | | | | | | | 0.6 | % | | | | | | | Aida Alvarez (10) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Roy Banks (11) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Jo Ann Barefoot (12) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Ginny Lee (13) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Louis P. Miramontes (14) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Carl Pascarella (15) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | Sandra A. Smith (16) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | David Strohm (17) | | | | | | | | | | | | | | | | | | | | | | | | 0.9 | % | | | | | | | Frederic Welts (18) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | R. Neil Williams (19) | | | | | | | | | | | | | | | | | | | | | | | | * | | | | | | | | All executive officers and directors as a group (16 persons) (20) | | | | | | | | | | | | | | | | | | | | | | | | 5.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | Name of Beneficial Owner | | | | | | | | | | | Number of Shares Beneficially Owned (1) | | | Percentage of Shares Beneficially Owned | | | | | | | | 5% Stockholders: | | | | | | | | | | | | | | | | | | | | | | | | | | | Institutional Venture Partners XIV, L.P. (2) | | | | | | | | | | | | | | | 3,408,691 | | | | 10.0 | % | | | | | | | Entities affiliated with Ellington (3) | | | | | | | | | | | | | | | 2,725,702 | | | | 8.0 | % | | | | | | | Entities affiliated with Blackrock (4) | | | | | | | | | | | | | | | 2,574,685 | | | | 7.6 | % | | | | | | | Kayne Anderson Rudnick Investment Management LLC (5) | | | | | | | | | | | | | | | 2,112,943 | | | | 6.2 | % | | | | | | | Entities affiliated with NB Alternatives Advisers LLC (6) | | | | | | | | | | | | | | | 2,096,727 | | | | 5.8 | % | | | | | | | Directors and Named Executive Officers: | | | | | | | | | | | | | | | | | | | | | | | | | | | Raul Vazquez (7) | | | | | | | | | | | | | | | 1,721,851 | | | | 5.0 | % | | | | | | | Jonathan Coblentz (8) | | | | | | | | | | | | | | | 584,221 | | | | 1.7 | % | | | | | | | Patrick Kirscht (9) | | | | | | | | | | | | | | | 520,522 | | | | 1.5 | % | | | | | | | Roy Banks (10) | | | | | | | | | | | | | | | 16,522 | | | | * | | | | | | | | Jo Ann Barefoot (11) | | | | | | | | | | | | | | | 49,606 | | | | * | | | | | | | | Ginny Lee (12) | | | | | | | | | | | | | | | 27,599 | | | | * | | | | | | | | Louis Miramontes (13) | | | | | | | | | | | | | | | 44,249 | | | | * | | | | | | | | Carl Pascarella (14) | | | | | | | | | | | | | | | 184,796 | | | | * | | | | | | | | Sandra A. Smith (15) | | | | | | | | | | | | | | | 16,522 | | | | * | | | | | | | | David Strohm (16) | | | | | | | | | | | | | | | 320,836 | | | | * | | | | | | | | Frederic Welts (17) | | | | | | | | | | | | | | | 28,409 | | | | * | | | | | | | | Neil Williams (18) | | | | | | | | | | | | | | | 70,657 | | | | * | | | | | | | | All executive officers and directors as a group (14 persons) (19) | | | | | | | | | | | | | | | 3,585,790 | | | | 10.2 | % |
* | Represents beneficial ownership of less than one percent of the outstanding common stock. |
(1) | Represents shares of common stock beneficially owned by such individual or entity, and includes shares held in the beneficial owner’s name or jointly with others, or in the name of a bank, nominee or trustee for the beneficial owner’s account. |
(2) | Based on a schedule 13G filed with the SEC on February 3, 2022, by BlackRock, Inc. According to the Schedule 13G, as of December 31, 2021, BlackRock, Inc. has the sole power to vote or direct the vote of 2,221,627 shares and sole power to dispose or to direct the disposition of 2,250,564 shares. The address for BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055.
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(3) | Based on the Schedule 13G filed with the SEC on February 14, 2022 by Institutional Venture Partners XIV, L.P. (“IVP XIV”), Institutional Venture Management XIV, LLC (“IVM XIV”), Todd C. Chaffee, Norman A. Fogelsong, Stephen J. Harrick, J. Sanford Miller, Jules A. Maltz and Dennis B. Phelps. According to the Schedule 13G, the reporting persons beneficially held a total 3,408,691 shares. The shares are held by IVP XIV. IVM XIV serves as the sole general partner of IVP XIV and has sole voting and investment control over the shares owned by IVP XIV and may be deemed to own beneficially the shares held by IVP XIV. IVM XIV owns no securities of the Company directly. Todd C. Chaffee, Norman A. Fogelsong, Stephen J. Harrick, J.Stanford Miller, Jules A. Maltz and David B. Phelps are Managing Directors of IVM XIV and share voting and dispositive power over the shares held by IVP XIV, and may be deemed to own |
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| beneficially the shares held by IVP XIV. The Managing Directors own no securities of the Company directly. IVP XIV’s address is 3000 Sand Hill Road, Suite 250, Menlo Park, CA 94025. |
(3) | Based on a Schedule 13G filed with the SEC on March 27, 2023, by Ellington Management Group, LLC, EMG Holdings, L.P., VC Investments LLC and Michael W. Vranos (collectively, “Ellington”), as of March 27, 2023, Ellington has shared voting and dispositive power with respect to 2,725,702 shares. The address for Ellington is 53 Forest Avenue, Old Greenwich, Connecticut 06870. |
(4) | Based on a Schedule 13G/A filed with the SEC on January 30, 2023, by BlackRock, Inc. According to the Schedule 13G, as of December 31, 2022, BlackRock, Inc. has the sole power to vote or direct the vote of |
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| 2,533,342 shares and sole power to dispose or to direct the disposition of 2,574,685 shares.The address for BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055. |
(5) | Based on a Schedule 13G/A jointly filed with the SEC on February 14, 2022,2023, by Kayne Anderson Rudnick Investment Management LLC (“Kayne Anderson”), Virtus Investment Advisors, LLC and Virtus Equity Trust, on behalf of Virtus KAR Small Cap Growth Fund.(“Virtus”). According to the Schedule 13G/A, as of December 31, 2021,2022, Kayne Anderson had sole investment discretion and voting authority over 578,543 shares, sole dispositive power with respect to 661,734 of these shares, andVirtus have shared voting and dispositive power with respect to 2,681,810 of theseover 1,508,434 shares and Kayne Anderson has sole voting power over 544,026 shares and sole dispositive power over 604,509 shares. Kayne Anderson’s address is 1800 Avenue of the Stars, 2nd Floor, Los Angeles, CA 90067.90067, and Virtus’ address is One Financial Plaza, Hartford, Connecticut 06103. The Schedule 13G/A further provides 2,681,8101,508,434 shares are beneficially held by Virtus Investment Advisors, LLC, One Financial Plaza, Hartford, Connecticut 06103, which has shared investment discretion and voting authority; and 2,635,930 shares are beneficially held by Virtus Equity Trust, on behalf of Virtus KAR Small Cap Growth Fund, 101 Munson Street, Greenfield, Massachusetts 01301, which has shared investment discretion and voting authority. |
(5) | Based on a Schedule 13G filed with the SEC on February 14, 2022, as of December 31, 2021, by Ashford Capital Management, Inc., the reporting persons beneficially held a total of 1,693,764 shares. The shares are held by Ashford Capital Management, Inc and the reporting person has sole dispositive and voting powers with respect to all of these shares. The address for Ashford Capital Management, Inc., is One Walker’s Mill Road, Wilmington, DE 19807.Virtus.
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(6) | BasedConsists of (a) 1,980,242 shares of common stock issuable to entities affiliated with NB Alternatives Advisers LLC upon exercise of warrants issued to such entities on March 10, 2023 in connection with that certain amended credit agreement dated as of March 10, 2023, amending our senior secured term loan (the “Amended Credit Agreement”) by and between us and certain entities affiliated with NB Alternatives Advisers LLC as lenders thereto, and (b) 116,485 shares of common stock issuable to entities affiliated with NB Alternatives Advisers LLC upon exercise of a Schedule 13G/A jointly filedwarrant issued to such entity on March 27, 2023 in connection with the SEC on February 4, 2022, by Wellington Management Group LLP, Wellington Group Holdings LLP, Wellington Investment Advisors Holdings LLP,Amended Credit Agreement. Ultimate voting and Wellington Management Company LLP (collective, “Wellington”). According to the Schedule 13G/A, as of December 31, 2021, Wellington Management Group LLP, Wellington Group Holdings LLP, and Wellington Investment Advisors Holdings LLP have shared voting power with respect to 2,550,883 shares, shared investment power with respect to 2,583,972 shares. Wellington Management Company LLP has shared voting power with respect to 2,524,919 shares and shared dispositive power with respect to 2,558,008 shares. Wellington’sthe shares of common stock issuable to the foregoing entities is exercised by NB Alternatives Advisers LLC. The address for NB Alternatives Advisers LLC is c/o Wellington Management Company LLP, 280 Congress325 N. Saint Paul Street, Boston, MA 02210.Suite 4900, Dallas, TX 75201.
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(7) | Consists of (a) 629,195727,819 shares held by Mr. Vazquez directly, (b) 172,864233,709 shares held in a trust for which Mr. Vazquez is trustee, (c) 659,091760,323 stock options exercisable within 60 days from April 18, 2022,17, 2023, of which 632,733744,612 are vested as of such date. |
(8) | Consists of (a) 1,493120,636 shares held by Mr. Coblentz directly, (b) 219,518272,780 shares held in a trust for which Mr. Coblentz is trustee, and (c) 157,093190,805 stock options are held by Mr. Coblentz and are exercisable within 60 days from April 18, 2022,17, 2023, of which 148,297185,551 are vested as of such date. |
(9) | Consists of (a) 192,025140,245 shares held by Mr. Kirscht directly, (b) 5,800 shares held in two accounts by Mr. Kirscht’s daughters containing 2,900 shares each, and (b) 333,853(c) 374,477 stock options exercisable within 60 days from April 18, 2022,17, 2023, of which 320,672367,744 are vested as of such date. |
(10) | Consists of (a) 17,37113,384 shares and (b) 1,5033,138 RSUs that are scheduled to vest within 60 days from April 18, 2022, and (c) 18,181 stock options are vested and exercisable within 60 days from April 18, 2022.17, 2023. |
(11) | Consists of (a) 2,64728,287 shares, (b) 1,3243,138 RSUs that are scheduled to vest within 60 days from April 18, 2022.17, 2023, and (c) 18,181 stock options that are vested and exercisable within 60 days from April 17, 2023. |
(12) | Consists of (a) 17,37113,384 shares, (b) 11,077 fully vested deferred RSUs, and (b) 1,503(c) 3,138 RSUs that are scheduled to vest within 60 days from April 18, 2022, and (c) 18,181 stock options are vested and exercisable within 60 days from April 18, 2022.17, 2023. |
(13) | Consists of (a) 2,64722,930 shares and (b) 958 fully vested deferred RSUs, and (c) 1,3243,138 RSUs that are scheduled to vest within 60 days from April 18, 2022.17, 2023, and (c) 18,181 stock options that are vested and exercisable within 60 days from April 17, 2023. |
(14) | Consists of (a) 12,014155,924 shares, (b) 1,50325,573 fully vested deferred RSUs, and (c) 3,922 RSUs that are scheduled to vest within 60 days from April 18, 2022, and (c) 18,181 stock options are vested and exercisable within 60 days from April 18, 2022.17, 2023. |
(15) | Consists of (a) 140,40113,384 shares and (b) 11,635 fully vested deferred RSUs, and (c) 1,8793,138 RSUs that are scheduled to vest within 60 days from April 18, 2022.17, 2023. |
(16) | Consists of (a) 2,647271,160 shares held by Mapache Investments L.P., (b) 1,32428,287 shares held directly by Mr. Strohm, (c) 18,251 fully vested deferred RSUs, and (d) 3,138 RSUs that are scheduled to vest within 60 days from April 18, 2022. |
(17) | Consists of 271,160 shares held by Mapache Investments L.P., (b) 17,371 shares held directly by Mr. Strohm, (c) 8,754 fully vested deferred RSUs, and (d) 1,503 RSUs that are scheduled to vest within 60 days from April 18, 2022.17, 2023. Mr. Strohm is a General Partner of Mapache Investments, L.P. and has voting and investment control over these shares.
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(18)(17) | Consists of (a) 2,64713,384 shares, (b) 99811,887 fully vested deferred RSUs, and (c) 1,3243,138 RSUs that are scheduled to vest within 60 days from April 18, 2022.17, 2023. |
(19)(18) | Consists of (a) 17,37128,287 shares, (b) 9,29121,051 fully vested deferred RSUs, (c) 1,5033,138 RSUs that are scheduled to vest within 60 days from April 18, 202217, 2023, and (d) 18,181 stock options that are vested and exercisable within 60 days from April 18, 2022.17, 2023. |
(20)(19) | Includes shares beneficially owned by all current executive officers and directors of the company. Consists of (a) 1,812,4912,089,370 shares, (b) 31,63687,083 fully vested deferred RSUs, (c) 14,69029,026 RSUs that are scheduled to vest within 60 days from April 18, 202217, 2023, and (d) 1,664,6021,380,148 stock options exercisable within 60 days from April 18, 2022,17, 2023, of which 1,528,1441,352,450 are vested as of such date. |
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Executive Officer Biographies The following is biographical information for our executive officers as of April 18, 2022:17, 2023: | | | | | | | | Name | | Age | | Position | | | | Raul Vazquez | | 5051 | | Chief Executive Officer and Director | | | | Jonathan Coblentz | | 5152 | | Chief Financial Officer and Chief Administrative Officer | | | | Patrick Kirscht | | 5455 | | Chief Credit Officer | | | | Joan Aristei | | 6263 | | General Counsel and Chief Risk Officer | | | | Matthew Jenkins | | 5354 | | Chief Operations Officer and General Manager, Personal Loans and Auto LoansLending |
For the biography of Mr. Vazquez, see “Directors, Executive Officers, and Corporate Governance—Board of Directors Biographies.” Jonathan Coblentz has served as our Chief Financial Officer since July 2009 and our Chief Administrative Officer since September 2015. Prior to joining Oportun, Mr. Coblentz served as Chief Financial Officer and Treasurer of MRU Holdings, Inc., a publicly-traded student loan finance company, from April 2007 to February 2009. Prior to joining MRU Holdings, Mr. Coblentz was a Vice President at Fortress Investment Group, LLC, a global investment management company. Prior to his time at Fortress, Mr. Coblentz spent over seven years at Goldman, Sachs & Co. Mr. Coblentz began his career at Credit Suisse First Boston. Mr. Coblentz received a B.S., summa cum laude, in Applied Mathematics with a concentration in Economics from Yale University. Patrick Kirscht has served as our Chief Credit Officer since October 2015, and previously served as our Vice President, Risk Management and Chief Risk Officer from October 2008 to October 2015 and our Senior Director, Risk Management from January 2008 to October 2008. Prior to joining Oportun, Mr. Kirscht was Senior Vice President of Risk Management for HSBC Card Services, Inc., the consumer credit card segment of HSBC Holdings, from 2007 to 2008. Mr. Kirscht joined HSBC Card Services in 2005 as part of HSBC’s acquisition of Metris Companies Inc., a start-up mono-line credit card company. Mr. Kirscht joined Metris Companies in 1995, where he served as Vice President of Planning and Analysis until he moved to Risk Management in 2004. Mr. Kirscht received a B.S. in Economics with a minor in Statistics, a B.S. in Business, and an M.B.A. from the University of Minnesota. Joan Aristei has served as our General Counsel and Chief Risk Officer since September 2020. She previously served as our General Counsel and Chief Compliance Officer since March 2018, as our Chief Compliance Officer from March 2017 to March 2018, and as our Vice President, Compliance from May 2014 to March 2017. Prior to joining Oportun, Ms. Aristei was a Director at Citi Private Bank from October 2010 to May 2014, where she served as head of Banking and Lending Product Compliance. Ms. Aristei was also previously Assistant General Counsel and Chief Compliance Officer for JP Morgan Chase & Company, in its auto finance and student lending division, where she led the establishment of a compliance framework for JP Morgan’s auto finance business after its merger with Bank One. Ms. Aristei received a B.A. in Chemistry and in French Literature from the University of California, San Diego, an M.B.A. from the UCLA Anderson School of Management and a J.D. from Loyola Law School. Matthew Jenkins has served as our Chief Operations Officer since November 2016 and also as our General Manager, Personal Loans since August 2018, and General Manager, Personal & Auto Loans since January 2020.2020 and General Manager, Lending since October 2022. Prior to joining Oportun, Mr. Jenkins was Managing Director, Head of Global Consumer Operations Functions at Citigroup Inc., or Citi, from April 2015 to November 2016. In his prior role, Mr. Jenkins served as the Cards Chief Operations Officer at Citi from July 2011 to April 2015. From September 1999 to July 2011, Mr. Jenkins held various leadership roles of increasing scope and responsibility within consumer operations at Citi. Prior to Citi, Mr. Jenkins worked at First USA/Bank One’s Cardmember Service team from September 1995 to September of 1999 in various capacities, most recently as the Chief Finance Officer and Director of Business Analytics. Mr. Jenkins also served in the U.S. Army from 1988 to 1992, where he worked as an Intelligence Analyst and Spanish Linguist. Mr. Jenkins received a B.A. in Economics, summa cum laude, from the University of Texas at Austin. | | |
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Executive Compensation Named Executive Officers The Company is a “smaller reporting company” under Item 10 of Regulation S-K promulgated under the Securities and Exchange Act of 1934, and the following compensation disclosure is intended to comply with the requirements applicable to smaller reporting companies. Although the rules allow the Company to provide less detail about its executive compensation program, the compensation and leadership committee is committed to providing the information necessaryhelpful to help stockholders to understand itsthe Company’s executive compensation-related decisions.compensation program. Accordingly, this section includes supplemental narratives that describe the executive compensation program for our named executive officers (the “NEOs”),NEOs during 2021:2022, who consisted of: | | | | | | | | |
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| Raul Vazquez Chief Executive Officer Age: 5051 Tenure: 1011 years | | | | Jonathan Coblentz Chief Financial Officer and Chief Administrative Officer Age: 5152 Tenure: 1314 years | | | | Patrick Kirscht Chief Credit Officer Age: 5455 Tenure: 1415 years |
Key 20212022 Highlights and Challenges Although we are proud of the highlights achieved in 2022, the deteriorating macroeconomic environment, including persistent inflation and high interest rates, created a challenging operating environment for Oportun that led to higher levels of charge-offs than we anticipated. Due to our strategic technology investments and continued enhancements of our proprietary risk models, in July 2022 we tightened our underwriting criteria and rapidly deploy changes into production. Notable achievements during 2022 include:
(1) | Includes 0.6M Hello Digit, Inc. (“Digit”) members acquired in the fourth quarter of 2021
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Against a challenging backdrop arising from the ongoing pandemic and overall economic uncertainty, we began 2021 focused on returning to growth, scaling our new products, and enhancing our digital platform. Throughout the year, we consistently executed across all these priorities and delivered one of our strongest financial performances to date. At a high level, in 2021, we achieved record level originations that were 70% higher than the prior year. We believe that we are gaining market share as we expand across the U.S. and our new borrowers represented over 47% of our total loans, up from 35% a year ago. Distribution points for our personal loan offering expanded rapidly last year through our Lending as a Service partnerships. We scaled our network to include 208 DolEx locations and 50 Barri Financial Group stores, and in 2022 we expect to more than
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double this number to over 500 Lending as a Service locations. Moreover, we plan to extend our Lending as a Service channel to additional partners, including both retail and fully-digital businesses. For our secured personal loan (SPL) product, we ended the year with $58 million in receivables, up 97% sequentially and well ahead of our target of $50 million. Credit card receivables nearly doubled sequentially to $67 million, well exceeding our year-end goal of $50 million.
In 2021, we intensified our focus on accelerating our growth capabilities and leveraging innovative technologies to further our mission. A significant contributor to our success in 2021 was the enhancement of our loan origination platform, which integrated secured and unsecured personal loans into a single acquisition funnel that helps to increase member conversion, while decreasing member acquisition costs. Additionally, we continued to invest significantly in our A.I. capabilities to expand the functionality and efficiency of our products. In December 2021, we acquired the digital banking platform Digit with the vision to be the leading A.I.-driven digital-first platform that helps improve the financial health of our members. With the addition of Digit’s four digital banking products: Digit Savings, Digit Direct, Digit Investing, and Digit Retirement to our existing suite of credit products, we believe that we will be able to continue to accelerate our growth and gain opportunities to establish long-term and more durable relationships with our members. To advance our mission, we also continued to address racial and social issues facing our employees and communities, which included charitable giving to programs serving underrepresented communities and expanding our community involvement and non-profit partnership programs. Other notable achievements in 2021 include:
Looking forward, we believe that we are well-positioned to help responsible, hardworking people across the U.S. borrow, save, bank, and invest through our digital banking platform and make financial health effortless for them. The compensation and leadership committee believes that the actions taken by the NEOs throughout 20212022 significantly contributed greatly to Oportun’s strong performance across many key financial, strategic, and other goals and were critical in building momentum for the company’s future growth.ability to mitigate the impacts of the macroeconomic challenges faced by Oportun in the second half of the year and continuing into 2023. Under their leadership, Oportun remains positioned to drive long-term shareholder value as we progress towards fulfilling our vision of becoming the leading A.I.-driven, digital-first platform helping hardworking individuals meet their borrowing, savings, budgeting, and spending needs.
The 2022 annual cash incentive program was linked to the company’s total revenue and adjusted net income, both of which were adversely affected by the challenging macroeconomic conditions. As a result, the program paid out only 75% of the target amount for corporate performance, underscoring the company’s commitment to aligning compensation with overall corporate performance. As discussed in more detail below in “Elements of Executive Compensation and 2022 Compensation Decisions — Annual Incentive Plan.” Oversight and Design of our Compensation Program Compensation Philosophy and Objectives We operate in a highly competitive and rapidly evolving market, and we expect competition among companies in our market to continue to increase. Our ability to compete and succeed in this environment is directly correlated to our ability to recruit, incentivize, and retain talented individuals. | | |
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We are guided by certain overarching values:
Primary Goals of our Executive Compensation Programs
| • | | | | Attract, motivate and retain highly qualified and experienced executives who can execute our business plans in a fast-changing, competitive landscape.36
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| • | | Recognize and reward our executive officers fairly for achieving or exceeding rigorous corporate and individual objectives.
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| • | | Align the long-term interests of our executive officers with those of our members and stockholders.
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Fiscal 20212022 Pay Mix The key components of total compensation opportunity for each executive officer set by the compensation and leadership committee annually are short-term cash compensation (annual base salary and annual incentive award) and long-term equity incentive compensation (stock options and RSUs)., which we refer to collectively as the executive officer’s target total direct compensation. The target pay mix for fiscal 20212022 for our CEO and average for our other NEOs on average, is shown below. | | | 38
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The CEO’s 20212022 target total direct compensation decision focuses on variable and “at-risk” compensation that is closely aligned with Company performance. As shown in the chart below, 88%85% of the CEO’s 20212022 target total direct compensation is performance-based and 80%77% of other NEOs’ compensation, on average, is performance-based.
Elements of our 2021 Compensation Program
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Elements of our 2022 Compensation Program (1) | For the CEO, 80% on corporate performance and 20% on attainment of individual goals. |
(2) | Generally, annual equity mix consisted of 50% stock options and 50% RSUs. For the 2022 annual compensation setting process, the compensation and leadership committee approved an annual equity mix for our executive officers of 25% stock options and 75% RSUs, as we migrate towardRSUs. The mix was adjusted for 2022 to manage the total shares outstanding used for annual employee long-term incentive compensation awards (our “burn rate”) and create executive retention through a challenging financial market practice of providing a greater of long-term equity compensation in the form of full value awards.and macroeconomic environment. |
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| | | Advisory Non-binding Vote on Executive Compensation In accordance with the requirements of Section 14A of the Exchange Act and the related rules of the SEC, our stockholders have the opportunity to cast an annual advisory non-binding vote to approve the compensation of our NEOs as disclosed pursuant to the SEC’s compensation disclosure rules. In 2021,2022, stockholders extended their support for our executive compensation programs with 94.6%96.6% of the votes cast in favor of the say-on-pay proposal. | | |
Compensation Governance Policies and Practices The Company’s executive compensation program is overseen by the compensation and leadership committee with the advice and support of the Company’s independent compensation consultant as well as input from the Company’s management team. The following summarizes certain executive compensation practices we have implemented to drive performance and create accountability and alignment with our shareholders, as well as the practices we have not implemented because we do not believe they would serve the Company and our stockholders’shareholders’ long-term interests. | | | | | | | | | | | | | | What We Do
| | | | | | What We Don’t Do | | | | | |
| | Design our executive compensation program so that a significant portion of the compensation for our NEOs is at risk based on the achievement of measures we believe drive the creation of long-term stockholder value
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| | Allow hedging or pledging of Company securities
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| | Single trigger change in control severance benefits
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| | Maintain individual employment arrangements with our executive officers
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| | Excise tax “gross-ups” upon change in control
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| | Review our peer group on an annual basis
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| | Special benefit or retirement plans that are exclusive to the executive team
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| | Hold annual advisory non-binding stockholder vote to approve the compensation of our NEOs
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| | Retain an independent compensation consultant
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| | Stock ownerships requirements for current Section 16 officers and directors (approved in April 2022)
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| | Clawback policy for current Section 16 officers (approved in April 2022)
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Roles of the Compensation and Leadership Committee, Management and the Compensation Consultant | | | Role of the Compensation and Leadership Committee | | The compensation and leadership committee is responsible for overseeing our compensation programs and policies, including our equity incentive plans. Our compensation and leadership committee operates under a written charter adopted and approved by our board of directors,Board, under which our board of directorsBoard retains concurrent authority with our compensation and leadership committee to approve compensation-related matters. Each year, the compensation and leadership committee reviews and approves compensation decisions as they relate to our NEOs and other senior executive officers, including our CEO. The compensation and leadership committee initially establishes a framework by engaging in a baseline review of our current compensation programs, together with its independent compensation consultant and management, to ensure that they remain consistent with our business requirements and growth objectives. In this review, the independent compensation consultant is also asked to provide a perspective on changing market practices as to compensation programs, with a particular focus on our identified peer group and other companies with whom we compete directly for talent, as discussed below under “Role of Compensation Consultants” and “Use of Competitive Market Data”. Following this review, the compensation and leadership committee considers the recommendations of our CEO, as discussed below under “Role of Management.” The compensation and leadership committee also manages the annual review process of our CEO, in cooperation with our lead director, in which all members of our board of directorsBoard are asked to participate and provide perspective, resulting in a compensation and leadership committee recommendation to the full board regarding individual compensation adjustments for our CEO. As part of this review of the compensation of our NEOs and other senior executive officers, the compensation and leadership committee considers several factors, including: • our corporate growth and other elements of financial performance; • individual performance and contributions to our business objectives; • the executive officer’s experience and scope of duties; • the recommendations of our CEO and other members of our management team; • retention risk; • internal pay equity; • an executive officer’s existing equity awards and stock holdings; while • ensuring our incentive plans do not encourage undue risk-taking. Our compensation and leadership committee rely on their judgment and extensive experience serving on the boards of publicly traded companies to establish an annual target total direct compensation opportunity for each NEO that they believe will best achieve the goals of our executive compensation program and our short-term and long-term business objectives. The compensation and leadership committee retains flexibility to review our compensation structure periodically as needed to focus on different business objectives. |
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| | | Role of Management | | Our CEO works closely with the compensation and leadership committee in determining the compensation of our NEOs (other than his own) and other executive officers. Each year, our CEO reviews the annual performance of our NEOs and other executive officers and makes recommendations to the compensation and leadership committee (except as it relates to his own performance and compensation) regarding individual compensation adjustments, promotions, bonus pool funding, level of achievement of corporate goals and annual incentive plan payouts. Our CEO also identifies and recommends corporate and individual performance objectives for our annual incentive plan for approval by the compensation and leadership committee based on our business plan and strategic objectives for the relevant fiscal year, and makes recommendations on the size, frequency and terms of equity incentive awards and new hire compensation packages. These recommendations from our CEO are often developed in consultation with members of his senior management team, including our CFO Chief People Officer, and General Counsel and Chief RiskPeople Officer. In certain situations, our compensation and leadership committee may elect to delegate a portion of its authority to our CEO or a subcommittee.subcommittee, other than any authority relating to our executive officers. Our compensation and leadership committee has delegated to our CEO the authority to make employment offers to candidates at and below the senior vice president level without seeking the approval of the compensation and leadership committee.committee, subject to certain parameters. In addition, our compensation and leadership committee has delegated to a subcommittee, currently made up of our CEO and CFO, the authority to approve certain equity grants to employees at and below the senior vice president level, subject to certain parameters approved by the compensation and leadership committee. At the request of the compensation and leadership committee, our CEO typically attends a portion of each compensation and leadership committee meeting, including meetings at which the compensation and leadership committee’s compensation consultant is present. From time to time, various members of management and other employees, as well as outside legal counsel and consultants retained by management, attend compensation and leadership committee meetings to make presentations and provide financial and other background information and advice relevant to compensation and leadership committee deliberations. Our CEO and other NEOs do not typically participate in, or beare present during, any deliberations or determinations of our compensation and leadership committee regarding their compensation or individual performance objectives. |
| | | Role of Compensation Consultants | | The compensation and leadership committee has the authority under its charter to retain the services of one or more external advisors, including compensation consultants, legal counsel, accounting, and other advisors, to assist it in performance of its duties and responsibilities. The compensation and leadership committee makes all determinations regarding the engagement, fees, and services of these external advisors, and any such external advisor reports directly to the compensation and leadership committee. During 2021,2022, the compensation and leadership committee retained CODA Advisors, as its independent compensation consultant to provide support and advisory services as it relates to our compensation program, primarily to review our compensation peer group and to provide a competitive assessment of our executive and non-employee director compensation programs. CODA Advisors performs no other services for us other than its work for the compensation and leadership committee. CODA Advisors complied with the definition of independence under the Dodd-Frank Act and other applicable SEC and stock exchange regulations. |
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Use of Competitive Market Data We strive to attract and retain the most highly qualified executive officers in an extremely competitive market. Accordingly, our compensation and leadership committee believes that it is important when making its compensation decisions to be informed as to the competitive market for executive talent, including the current practices of comparable public companies. Consequently, our compensation and leadership committee periodically reviews market data for each executive officer’s position, as described below. The compensation and leadership committee approved a peer group of comparable publicly tradedpublicly-traded companies, developed with the assistance of CODA Advisors, to use as a reference point when makingaid it in assessing the overall competitiveness of our executive compensation decisions. Because we are uniquely situated in bothprogram and the financial services and technology industries,key components of compensation under the number of directly comparable companies in terms of business operations and scope are limited.program. The peer group is generally selected from publicly-traded companies with (i) comparable total revenue and market capitalization in related industries (i.e., consumer finance, software and services), or (ii) that have similar product offerings.offerings or (iii) are similarly sized to Oportun and compete for executive-level talent in the San Francisco Bay Area. For the purposes of the March 20212022 equity refresh grants discussed below under the heading “Elements of Executive Compensation and 20212022 Compensation Decisions—Long-Term Incentive Compensation,” our compensation and leadership committee considered compensation data from the below-listed companies.
In June 2021, the compensation and leadership committee revised the peer group to exclude some peers who were acquired as part of ongoing M&A activity as well as reflect changes in Oportun’s and the peers’ financial size. At the time of selection in June 2021, trailing four quarter revenues for the revised peer group companies ranged from $313 million to $1.3 billion with a median of $529 million. This revised peer group was used for making compensation decisions as part of our 2022 annual compensation setting process. Our compensation and leadership committee intends to review the peer group annually and may consider supplemental information from other public companies and third-party surveys.
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| | 43Elevate Credit | | LendingClub | | Priority Technology | Atlanticus | | Enova International | | LendingTree | | Provident Financial | Blucora | | Envestnet | | Northwest Bancshares | | Regional Management | Bottomline Tech | | Green Dot | | PagerDuty | | Washington Federal | CURO Group | | Greensky | | Premier Financial | | World Acceptance |
Elements of Executive Compensation and 20212022 Compensation Decisions The key components of the target total direct compensation opportunity for each executive officer set by the compensation and leadership committee annually are fixed cash compensation (annual base salary), short-term cash incentive compensation and long-term equity incentive compensation (stock options and RSUs). The compensation and leadership committee generally allocates between total cash compensation and equity compensation in a way that the committee believes substantially links executive compensation to corporate performance and strikes a balance between our short-term and long-term strategic goals. A significant portion of our NEOs’ target total direct compensation opportunity is comprised of “at-risk” compensation in the form of performance-based bonus opportunities and equity awards in order to align the NEOs’ incentives with the interests of our stockholders and our corporate goals. The compensation and leadership committee believes that the target total direct compensation of our NEOs should target aroundbe competitive within the median percentile of the peer group, and will then give consideration tomarkets in which we compete, while considering factors such as tenure, individual performance, company performance and any unique circumstances of the NEO’s position based on that individual’s responsibilities and market factors. We believe that this target will enable us to attract, motivate and retain the executive talent necessary to develop and execute our business strategy. The compensation and leadership committee reviews the compensation of our NEOs against our peer group and other companies which we compete with for talent and may increase the compensationto provide a general assessment of the NEOs to bring them to levels closer to the target percentile over the next few years.overall competitiveness of our executive compensation program. We also provide our NEOs with certain severance and change in control benefits, as well as other benefits generally available to all our employees, including retirement benefits under our 401(k) plan and participation in our employee benefit plans. However, these additional benefits are not considered as any material factors in determining the key components of the executive compensation program consisting of salary, and short-term cash and long-term equity incentive compensation. | | | | | 42 |
Base Salaries Base salary is designed to be a competitive fixed component that establishes a guaranteed minimum level of cash compensation to recognize and reward the day-to-day contributions of our executive officers. Base salaries are initially set through arm’s-length negotiation at the time of hiring, taking into account level of responsibility, qualifications, experience, salary expectations and market data. Base salaries are then reviewed on an annual basis by the compensation and leadership committee and salary adjustments may be made to bringadjusted. The table below reflects changes in our NEOs’ salaries aroundfrom the median percentile of the peer group and based on other factors discussed above under “Oversight and Design of our Compensation Program.”prior year. | | | | | | | | | | | | 2020 Annual Base Salary ($) | | 2021 Annual Base Salary ($) (1) | | Increase (%) | | | | | | | | | 2021 Annual Base Salary ($) | | 2022 Annual Base Salary ($) (1) | | Increase (%) | | | Raul Vazquez | | | | | | | | | 550,000 | | | | 600,000 | | | | 9.1 | | | | | | | | | | 600,000 | | | | 700,000 | | | | 16.7 | | | Jonathan Coblentz | | | | | | | | | 373,014 | | | | 387,002 | | | | 3.7 | | | | | | | | | | 387,002 | | | | 421,832 | | | | 9.0 | | | Patrick Kirscht | | | | | | | | | 430,560 | | | | 446,706 | | | | 3.8 | | | | | | | | | | 446,706 | | | | 473,508 | | | | 6.0 | |
(1) | The base salary amount for each of our NEOs other than the CEO, wereis approved by the compensation and leadership committee in March 2021 andcommittee. The 2022 base salaries were effective as of March 1, 2021. The base salary amount for the CEO was approved by the compensation and leadership committee in June 2021 and effective as of March 1, 2021.2022. |
Annual Incentive Plan Each of our NEOs was eligible to participate in our annual incentive plan for 2021.2022. This performance-based cash compensation was designed to reward the achievement of annual corporate performance relative to pre-established goals, as well as individual performance, contributions and strategic impact. The compensation and leadership committee established target annual incentive awards for each executive officer, denominated as a percentage of base salary, which were set at the same percentagepercentages of base salary for 20212022 as in 2020.2021. | | | 44
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| | | | | | 2021 Target Annual Incentive Award Opportunity | | 2022 Target Annual Incentive Award Opportunity | | | | Target Award ($) | | Percentage of Base Salary (%) | | Target Award ($) | | Percentage of Base Salary (%) | | Raul Vazquez | | 600,000 | | 100 | | 700,000 | | 100 | | Jonathan Coblentz | | 251,551 | | 65 | | 274,191 | | 65 | | Patrick Kirscht | | 290,359 | | 65 | | 307,780 | | 65 |
For 2021,2022, the compensation and leadership committee approved the corporate performance goals and their respective weightings set forth below. In selecting these corporate performance goals, our compensation and leadership committee believed that they were appropriate drivers for our business as they provided a balance between growing our business and strengthening our financial position, which enhance stockholder value. Periodically throughout the year, the compensation and leadership committee may revise corporate performance goals and weightings for annual incentive awards based on our business priorities and annual operating plan. For 2021, the compensation and leadership committee considered the likelihood of a range of business scenarios and results that could impact business performance and revenue growth, including the ongoing uncertainty related to the COVID-19 pandemic and related economic conditions, and the alignment between appropriate payout opportunities and strong business performance at threshold, target, and maximum goal levels. The compensation and leadership committee utilizes Adjusted EBITDANet Income as a financial performance metric because it believes that Adjusted EBITDANet Income provides the most accurate measure of the Company’s ongoing business and financial performance. It also allows the compensation and leadership committee to more fully assess the Company’s productivity and efficiency, as well as to evaluate comparative results period-over-period. Please see the Appendix to this proxy statement for the Company’s definition of Adjusted EBITDA.Net Income.
(1) | For the CEO, 80% on corporate performance and 20% on attainment of individual goals.
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* | Maximum corporate attainment of 150% reached
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For 2021 we achieved total revenue of $626.8 million and Adjusted EBITDA of $47.0 million, up year-on-year from $583.7 million and $22.0 million, respectively. These results significantly exceeded the maximum goals for each of the financial performance measures. We also ended the year with SPL and credit card receivables well ahead of year-end targets. We made significant progress in growing our Lending as a Service partner network and accelerating our product and service offerings across the nation. The strong performance and disciplined execution by management of our strategic initiatives empowered us to successfully manage the uncertainties of the current economic environment and drive strong and sustainable growth. For a reconciliation of these non-GAAP measures to GAAP measures, refer to the Appendix to this proxy statement. For more information about our business, please see “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.
Individual annual incentive award goals and achievement for our NEOs other than our CEO vary depending on our strategic corporate initiatives and each executive officer’s responsibilities. While not exhaustive, below are certain key factors that the compensation and leadership committee, in consultation with our CEO, considered when determining the individual component of each 2021 annual incentive award. In 2021, our NEOs showed exceptional performance both in navigating the Company through the unprecedented challenges resulting from the COVID-19 pandemic and guiding Oportun on a trajectory for continued growth. The compensation and leadership committee recognized the individual accomplishments of the NEOs, including:
Entry into additional strategic partnerships to offer Oportun products in partner locations;
Acquisition of Digit to create a comprehensive digital banking platform that provides a full suite of credit and banking products;
Strong recovery in loan originations and rapid growth of credit card and secured personal loan receivables;
Continuous enhancements to our proprietary risk model and refinement of our A.I., data, and analytics capabilities across our products; and
Diversified capital markets funding sources to support new origination growth for our products.
In 2021,2022, the annual incentive awards were weighted 75% on corporate performance and 25% on attainment of individual goals for all of our NEOs, except for our CEO. The annual incentive award for the CEO was weighted 80% on corporate performance and 20% on attainment of individual goals. Individual goal achievement for each NEO’s performance was determined by the compensation and leadership committee, and for 20212022 determined that allattainment percentages for such individual goals did not meet expectations.
(1) | For the CEO, the weightings were 80% on corporate performance and 20% on attainment of individual goals. |
The following provides additional information regarding the corporate goals under our Annual Incentive Plan for 2022. | | | | | 44 |
Our 2022 performance included several achievements but ultimately fell short of our expectations. We achieved total revenue of $952.5 million, up year-on-year from $626.7 million. Adjusted Net Income was $69.4 million, a decrease from $78.7 million in the prior year, primarily driven by macroeconomic deterioration, which drove higher losses and increased interest expense, as well as higher Adjusted Operating Expense. We made significant progress in combining and accelerating our product and service offerings and growing our Lending as a Service partner network. Between 2021 to 2022, we saw a decline in Total Stockholder Return, reflecting challenging macroeconomic conditions and stock price decline. For a reconciliation of these non-GAAP measures to GAAP measures, refer to the Appendix to this proxy statement. For more information about our business, please see “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Individual annual incentive award goals and achievement for our NEOs vary depending on our strategic corporate initiatives and each executive officer’s responsibilities. While not exhaustive, below are certain key factors that the compensation and leadership committee, in consultation with our CEO, considered when determining the individual component of each 2022 annual incentive award. While the compensation and leadership committee recognized that the deteriorating macroeconomic environment resulting from inflationary pressures and a high interest rate environment negatively impacted the business and stock performance, it determined that in 2022 our NEOs were fully met.able to quickly shift priorities to focus on tightening our underwriting criteria to lower charge-off rates, reducing expenses, optimizing operational efficiency and guiding Oportun on a trajectory for continued sustainable growth and creating long-term value for shareholders. The compensation and leadership committee recognized the individual accomplishments of the NEOs, including: Development of the Oportun Mobile App to provide a seamless user experience across our credit and digital banking products; Strong growth in members and products; Adapted credit underwriting quickly in light of changing macro environment, resulting in post- tightening vintage performing as targeted despite persistent inflation; Making continuous enhancements to our proprietary risk model by leveraging bank transaction data in models and refinement of our A.I. capabilities; Diversified funding sources to support new origination growth; and Entry into additional strategic partnerships to offer Oportun products in partner locations. As a result of the compensation and leadership committee’s performance review, including the decline in our Net Income and Total Stockholder Return, the following annual incentive awards were paid to each of our NEOs for 2022, representing a decrease in the incentive award paid in comparison to 2021: | | | | | | | | | | Target Bonus ($) | | Corporate Achievement (% of Target) | | Individual Achievement (% of Target) | | Bonus Payout (% of Target) | | Bonus Amount ($) | | | Target Bonus ($) | | Bonus Payout (% of Target) | | Bonus Amount ($) | | | Raul Vazquez | | | | | | | 600,000 | | | | 122.8 | | | | 130.0 | | | | 124.2 | | | | 745,440 | | | | 700,000 | | | | 75.0 | | | | 525,000 | | | Jonathan Coblentz | | | | | | | 251,551 | | | | 122.8 | | | | 130.0 | | | | 124.6 | | | | 313,433 | | | | 274,191 | | | | 71.3 | | | | 195,361 | | | Patrick Kirscht | | | | | | | 290,359 | | | | 122.8 | | | | 125.0 | | | | 123.4 | | | | 358,158 | | | | 307,780 | | | | 76.3 | | | | 234,682 | |
Long-Term Incentive Compensation Our compensation and leadership committee believes long-term incentive compensation is an effective means for focusing our NEOs on driving increased stockholder value over a multi-year period and motivating | | | | | 45 |
them to remain employed with us. Currently, our compensation and leadership committee uses equity awards in the form of stock options and RSUs to deliver annual long-term incentive compensation opportunities to our | | | 46
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NEOs and to address special situations as they may arise from time to time. The compensation and leadership committee establishes annual targets for long-term incentive compensation to our NEOs and other executive officers, taking into consideration the competitive market analysis performed by our compensation consultant. Our compensation and leadership committee considers stock options to be inherently performance-based, and automatically link executive pay to stockholder return, because the executive derives value from a stock option only if our stock price increases. As part of a balanced compensation strategy, our compensation and leadership committee also awards RSUs to help us to attract, motivate and retain our NEOs. In March 2021,2022, in connection with our 20202021 annual review process and performance year-to-date, we granted refresh equity grants of stock options and RSUs to NEOs. The stock option grants provide for a four-year vesting schedule, with one-fourth of the shares subject to each stock option vesting on the first anniversary of the vesting commencement date, and the remaining shares vesting in 36 successive equal monthly installments following the first anniversary of the vesting commencement date, subject to the NEO’s continued service on each such vesting date. Each RSU grant provides for a four-year vesting schedule, with one-fourth of the RSUs vesting on each anniversary of the vesting commencement date, subject to the NEO’s continued service on each such vesting date. In determining the amount of such grants, the compensation and leadership committee considered compensation data with respect to the March 20212022 peer group for the grants issued in March 20212022 and granted equity at a levellevels comparable to the median annual equity grant values of the peer group, while recognizing and reflecting the share price at the time of grant, the resulting share dilution and impact on each grant date.the plan share reserve. Historically, equity awards have been granted in connection with an executive officer’s initial employment or promotion, and thereafter on a periodic basis (generally annually) in order to retain and reward our NEOs based on factors such as individual performance and strategic impact, retention goals and competitive pay practices. The compensation and leadership committee generally determines the size and mix of equity awards to our NEOs in consultation with our CEO (except with respect to his own awards) and based on factors discussed above in “Oversightand Design of our Compensation Program.” The compensation and leadership committee intends to continue to review the existing equity holdings of our NEOs, including the percentage of equity awards that arehave vested, or will become vested as a result of our offering, as well as other factors, when making decisions on future equity grants to our NEOs. Employment and Change in Control Arrangements We have entered into at-will employment offer letters with each of our NEOs that were approved by the compensation and leadership committee and our board of directors.Board. In addition, we provide each NEO with the opportunity to receive certain severance payments and benefits in the event of a termination of employment under certain circumstances, including in connection with a change of control. The compensation and leadership committee generally believes that that the severance protection payments and benefits we offer are necessary to provide stability among our executive officers, serve to focus our executive officers on our business operations, and avoid distractions in connection with a potential change in control transaction or period of uncertainty. For additional information on the employment arrangements and potential post-employment payments to our NEOs, see “Employment, Severance, and Change in Control Agreements” and “Potential Payments and Benefits Upon Termination or Change in Control” below. 401(k) Plan and Employee Benefits During 2021,2022, all full-time employees in the United States employed by Oportun, including the NEOs, were eligible to participate in the Company’s 401(k) plan, a tax qualified retirement plan (with an employer match up to 4% of eligible contributions). Other than the 401(k) plan, we do not provide defined benefit pension plans or defined contribution retirement plans to the NEOs or other employees. | | | | | 46 |
We also offer a number of benefit programs to our full-time employees, including our NEOs, in the United States. These benefits include medical, vision and dental insurance, health and dependent care flexible | | |
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spending accounts, wellness programs, charitable donation matching, short-term and long-term disability insurance, accidental death and dismemberment insurance, basic life insurance coverage, and business travel insurance. Full-time and part-time employees in the United States are eligible to receive paid parental leave. Stock Ownership Guidelines In April 2022, the compensation and leadership committee adopted stock ownership guidelines for our executive officers and non-employee directors in order to further align their interests with our stockholders. Under these guidelines, each individualparticipant is required to own shares of our common stock with value toof at least the following: | | | | | Position | | Ownership Requirement | CEO | | 6x annual base salary | Other Section 16 officers | | 3x annual base salary | Non-employee directors | | 5x annual Board cash retainer |
Covered executives are expected to meet the required ownership level within five years of the later of the initial adoption of the policy or hire or promotion into a covered executive role. Non-employee directors are expected to meet the required ownership level within five years of the appointment date. Further, executives and non-employee directors must hold at least 50% of any net after-tax shares realized from equity award vesting or exercise until the guideline has been met. Shares held outright and unvested RSUs that are subject to only a time-vesting condition count towards the ownership threshold but shares underlying options and unearned performance-vesting shares do not. Compensation Clawback In April 2022, the compensation and leadership committee approved the executive clawback policy which applies to our Section 16 officers. Our clawback policy provides that if (i) the Company is required to restate its financial statements filed pursuant to the Exchange Act as a result of a material error in these financial statement, (ii) such restatement is due to the gross negligence or intentional misconduct of a clawback officer (as determined by the compensation and leadership committee), (iii) the amount of any cash-based incentive paid to or payable to such clawback officer that was determined based on the achievement of financial or operating results would have been less if such financial statements had been correct at the time of determination, and (iv) no more than three years have elapsed from the filing date of such financial statements upon which such incentive compensation was determined, then the Company shall recoup from such clawback officer an amount equal to such excess cash incentive compensation through such means as the compensation and leadership committee determines in accordance with the policy. Hedging and Pledging Policies We have established an insider trading policy, which, among other things, prohibits all employees and non-employee directors from engaging in short sales or transactions in publicly-traded options (such as puts and calls) and other derivative securities relating to our common stock, hedging or similar transaction designed to decrease the risks associated with holding our securities, pledging any of our securities as collateral for a loan, and holding any of our securities in a margin account. Compensation Risk Assessment The compensation and leadership committee has reviewed our compensation programs to assess whether they encourage our employees to take excessive or inappropriate risks. After reviewing and assessing our compensation philosophy, policies and practices, including the mix of fixed and variable, short-term and long-term incentives and overall pay, incentive plan structures, and the checks and balances built into, and oversight | | | 48
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of, each plan and practice, the compensation and leadership committee has determined that any risks arising from our compensation programs are not reasonably likely to have a material adverse effect on the Company. | | | | | 47 |
Deductibility of Executive Compensation Section 162(m) of the Internal Revenue Code generally places a $1 million limit on the amount of compensation a publicly heldpublicly-held company can deduct for U.S. federal tax purposes in any tax year on compensation paid to “covered employees.” However, theThe compensation and leadership committee retains discretion to award compensation that it determines to be consistent with the goals of our executive compensation program even if such compensation isamounts which are not fully tax deductible by us, and can modify compensation that was initially intended to be tax deductibletax-deductible if it determines that such modifications arecompensation is consistent with our business needs. Thus, executive compensation arrangements may not be fully tax deductible or, if initially intended to be tax deductible, may not actually receive this treatment. Taxation of Parachute Payments and Deferred Compensation We do not provide, and have no obligation to provide, any executive officer, including any NEO, with a “gross-up” or other reimbursement payment for any tax liability that he or she might owe as a result of the application of Section 280G, 4999, or 409A of the Code. Sections 280G and 4999 of the Code provide that executive officers and directors who hold significant equity interests and certain other service providers may be subject to an excise tax if they receive payments or benefits in connection with a change of control that exceed certain limits prescribed by the Code, and that the employer may be unable to take a deduction on the amounts subject to this additional tax. Summary Compensation Table The following table provides information regarding allthe compensation awarded to, earned by or paid to our NEOs for the years ended December 31, 2022, 2021, 2020, and 2019:2020: | | | | | | | | | | | | Year | | Salary (1) ($) | | Stock Awards (2)(3) ($) | | Option Awards (2) ($) | | Non-Equity Incentive Plan Compensation (4) ($) | | All Other Compensation (5) ($) | | Total ($) | | | Year | | Salary (1) ($) | | Stock Awards (2)(3) ($) | | Option Awards (2)(3) ($) | | Non-Equity Incentive Plan Compensation (4) ($) | | All Other Compensation (5) ($) | | Total ($) | | Raul Vazquez(7) | | 2021 | | 600,000 | | | 875,019 | | | 875,010 | | | 745,440 | | 31,999 | | 3,127,468 | | | 2022 | | 683,836 | | | 2,650,738 | | | 875,005 | | | 525,000 | | 31,345 | | 4,765,924 | | Chief Executive Officer | | 2020 | | 550,000 | | | 3,500,024 | | | 1,750,002 | | | 550,000 | | 28,977 | | 6,379,003 | | | 2021 | | 591,917 | | | 875,019 | | | 875,010 | | | 745,440 | | 31,999 | | 3,119,385 | | | | 2019 | | 481,000 | | | 1,287,948 | | | 1,249,737 | | | 458,634 | | 20,895 | | 3,498,214 | | | 2020 | | 538,847 | | | 3,500,024 | | | 1,750,002 | | | 550,000 | | 28,977 | | 6,367,850 | | Jonathan Coblentz(8) | | 2021 | | 387,002 | | | 300,021 | | | 300,011 | | | 313,433 | | 23,439 | | 1,323,906 | | | 2022 | | 416,202 | | | 833,099 | | | 275,002 | | | 195,361 | | 24,025 | | 1,743,689 | | Chief Financial Officer and Chief Administrative Officer | | 2020 | | 373,014 | | | 1,200,008 | | | 600,008 | | | 243,974 | | 26,769 | | 2,443,773 | | | 2021 | | 384,741 | | | 300,021 | | | 300,011 | | | 313,433 | | 23,439 | | 1,321,645 | | | 2019 | | 351,900 | | | 429,316 | | | 416,576 | | | 226,676 | | 12,645 | | 1,437,113 | | | 2020 | | 370,344 | | | 1,200,008 | | | 600,008 | | | 243,974 | | 26,769 | | 2,441,103 | | Patrick Kirscht(9) | | 2021 | | 446,706 | | | 375,005 | | | 375,011 | | | 358,158 | | 36,150 | | 1,591,030 | | | 2022 | | 469,176 | | | 1,136,034 | | | 375,008 | | | 234,682 | | 38,949 | | 2,253,849 | | Chief Credit Officer | | 2020 | | 430,560 | | | 1,500,008 | | | 750,007 | | | 281,613 | | 37,243 | | 2,999,431 | | | 2021 | | 433,816 | | | 375,005 | | | 375,011 | | | 358,158 | | 36,150 | | 1,578,140 | | | | 2019 | | 414,000 | | | 643,974 | | | 624,864 | | | 256,587 | | 14,807 | | 1,954,232 | | | 2020 | | 427,883 | | | 1,500,008 | | | 750,007 | | | 281,613 | | 37,243 | | 2,996,754 | |
(1) | The salary amounts in this column reflect the blended salary paid, which takes into account any salary increases effective during the year, if any. These amounts have been adjusted to reflect the blended salary paid and may deviate an immaterial amount from the previously reported salaries. |
(2) | These columns reflect the aggregate grant date fair value of stock options and RSUs measured pursuant to FASB ASC 718 without regard to forfeitures. The assumptions used in calculating the grant date fair value of these awards are set forth in Note 2 and Note 1312 in our Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K filed with the SEC on March 1, 2022.14, 2023. These amounts do not reflect the actual economic value that may be realized by the NEO. |
(3) | 2020 amount includes “pull-forward” grants awarded in September 2020 where the grant pulled forward 50% of the annual grant value that otherwise would have been awarded as part of the annual review process in March 2021, with the remainder issued as equity grants of stock options and RSUs in March 2021. See |
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| | 49 |
| “Executive Compensation - Compensation—Long-Term Incentive Compensation” in our proxy statement filed April 28, 2021 for more information. |
(4) | The amounts represent the bonuses paid under our annual incentive plan. |
| | | | | 48 |
(5) |
| The amounts reported for 2021 include the cash value of Oportun’s match of our NEO’s contributions to the 401(k) plan and matching charitable contributions made by Oportun in 2021 pursuant to the Company’s charitable match program. The reported amounts includeprogram and certain life insurance premium payments. For 2022, “All Other Compensation” includes (i) $11,600$12,200 for 401(k) employer match and $1,500$318 for charitable matchlife insurance premium for Mr. Vazquez; (ii) $11,600$12,200 for 401(k) employer match, $318 for life insurance premium, and $1,500$1,000 for charitable match for Mr. Coblentz and (iii) $11,600$12,200 for 401(k) employer match and $318 for life insurance premium for Mr. Kirscht. |
(6) | Mr. Vazquez serves on our Board but is not paid additional compensation for such service. |
(7) | Mr. Vazquez’s base salary was increased from $600,000 to $700,000, effective March 1, 2022. |
(8) | Mr. Coblentz’s base salary was increased from $387,002 to $421,832, effective March 1, 2022. |
(9) | Mr. Kirscht’s base salary was increased from $446,706 to $473,508, effective March 1, 2022. |
Grants of Plan-Based Awards in Fiscal Year 20212022 The following table provides information regarding each grant of a plan-based award made to an NEO under any plan in the year ended December 31, 2021:2022: | | | | | | | | Type of Award | | Grant Date | | | Estimated Future Payout Under Non-Equity Incentive Plan Awards (1) ($) | | | All Other Stock Awards: Number of Shares or Units (#) | | | All Other Option Awards: Number of Securities Underlying Options (#) | | | Exercise or Base Price of Option Awards ($) | | | Grant Date Fair Value of Stock and Option Awards (2) ($) | | | Type of Award | | Grant Date | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards: (1) Target ($) | | | All Other Stock Awards: Number of Shares or Units (#) | | | All Other Option Awards: Number of Securities Underlying Options(2) (#) | | | Exercise or Base Price of Option Awards ($) | | | Grant Date Fair Value of Stock and Option Awards (3) ($) | | Raul Vazquez | | Annual incentive award | | | 3/1/2022 | | | | 745,440 | | | | — | | | | — | | | | — | | | | — | | | Annual incentive award | | | 4/17/2023 | | | | 525,000 | | | | — | | | | — | | | | — | | | | — | | | | Stock options | | | 3/10/2021 | | | | | | — | | | | 72,136 | | | | 21.26 | | | | 875,010 | | | Stock options | | | 3/25/2022 | | | | — | | | | — | | | | 111,548 | | | | 13.39 | | | | 875,005 | | | | RSU | | | 3/10/2021 | | | | | | 41,158 | | | | — | | | | — | | | | 875,019 | | | RSU | | | 3/25/2022 | | | | — | | | | 197,964 | | | | — | | | | — | | | | 2,650,738 | | Jonathan Coblentz | | Annual incentive award | | | 3/1/2022 | | | | 313,433 | | | | — | | | | — | | | | — | | | | — | | | Annual incentive award | | | 4/7/2023 | | | | 195,361 | | | | — | | | | — | | | | — | | | | — | | | Stock options | | | 3/10/2021 | | | | | | — | | | | 24,733 | | | | 21.26 | | | | 300,011 | | | Stock options | | | 3/25/2022 | | | | — | | | | — | | | | 35,058 | | | | 13.39 | | | | 275,002 | | | RSU | | | 3/10/2021 | | | | | | 14,112 | | | | — | | | | — | | | | 300,021 | | | RSU | | | 3/25/2022 | | | | — | | | | 62,218 | | | | — | | | | — | | | | 833,099 | | Patrick Kirscht | | Annual incentive award | | | 3/1/2022 | | | | 358,158 | | | | — | | | | — | | | | — | | | | — | | | Annual incentive award | | | 3/10/2023 | | | | 234,682 | | | | — | | | | — | | | | — | | | | — | | | | Stock options | | | 3/10/2021 | | | | | | — | | | | 30,916 | | | | 21.26 | | | | 375,011 | | | Stock options | | | 3/25/2022 | | | | — | | | | — | | | | 47,807 | | | | 13.39 | | | | 375,008 | | | | RSU | | | 3/10/2021 | | | | | | 17,639 | | | | — | | | | — | | | | 375,005 | | | RSU | | | 3/25/2022 | | | | — | | | | 84,842 | | | | — | | | | — | | | | 1,136,034 | |
(1) | This column representsRepresents the target amount of annual cash incentive compensation for which the executive was eligible to receive under our annual incentive plan. There are no minimum thresholds or maximums.
|
(2) | The per share exercise price of the stock option is the closing price of a share of our common stock on the date of the grant. |
(3) | This column reflects the aggregate grant date fair value of the stock options and RSUs measured pursuant to FASB ASC 718, without regard to forfeitures. The assumptions used in calculating the grant date fair value of these awards are set forth in Note 2 and Note 13 to our Notes to the Consolidated Financial Statements included on our Annual Report on Form 10-K filed March 1, 2022.14, 2023. These amounts do not reflect the actual economic value that may be realized by the NEO. |
Annual Incentive Plan Each of our NEOs was eligible to participate in our annual incentive plan for 2022. For more information For additional discussion regarding the criteria applied in determining the amounts payable under the Annual Incentive Plan, please see “Executive Compensation—Annual Incentive Plan.” | | | 50
| | 49 |
Outstanding Equity Awards at 20212022 Fiscal Year End The following table provides information with respect to all outstanding stock options and RSUs held by our NEOs as of December 31, 2021.2022. See “Employment, Severance, and Change in Control Agreements” and “Potential Payments and Benefits Upon Termination or Change in Control” below for information regarding the impact of certain employment termination scenarios on outstanding equity awards. | | | | | | | | | | | | | | | | | | | | | | | | Option Awards | | | | | | Stock Awards | | | | | | | | | | | | | | | Option Awards | | | | | | Stock Awards | | | Name | | | | | | | | | | | Vesting Commencement Date (1) | | Number of Securities Underlying Unexercised Options— Unexercisable (2) (#) | | | Number of Securities Underlying Unexercised Options— Exercisable (3) (#) | | | Option Exercise Price ($/sh) | | | Option Expiration Date | | | | | Number of Shares or Units That Have Not Vested (4) (#) | | | Market Value of Shares or Units That Have Not Vested (5) ($) | | | | | | | | | | | | Vesting Commencement Date (1) | | Number of Securities Underlying Unexercised Options— Unexercisable (2) (#) | | | Number of Securities Underlying Unexercised Options— Exercisable (3) (#) | | | Option Exercise Price ($/sh) | | | Option Expiration Date | | | | | Number of Shares or Units That Have Not Vested (4) (#) | | | Market Value of Shares or Units That Have Not Vested (5) ($) | | Raul Vazquez | | | | | | | | | 4/9/2012 | | | | — | | | | 791,318 | | | | 1.32 | | | | 8/1/2022 | | | | | | — | | | | — | | | | | | | | | | 7/25/2013 | | | | — | | | | 101,675 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | | 7/25/2013 | | | | — | | | | 101,675 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | 9/10/2014 | | | | — | | | | 136,363 | | | | 10.23 | | | | 9/9/2024 | | | | | | — | | | | — | | | | | | | | | | | 9/10/2014 | | | | — | | | | 136,363 | | | | 10.23 | | | | 9/9/2024 | | | | | | — | | | | — | | | | | | | | | | 7/31/2015 | | | | — | | | | 3,741 | | | | 26.73 | | | | 9/28/2025 | | | | | | — | | | | — | | | | | | | | | | | 7/31/2015 | | | | — | | | | 3,741 | | | | 26.73 | | | | 9/28/2025 | | | | | | — | | | | — | | | | | | | | | | 11/30/2016 | | | | — | | | | 145,453 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | | 11/30/2016 | | | | — | | | | 145,453 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | 3/3/2019 | | | 8,790 | | | | 131,761 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | | 8/30/2018 | | | | — | | | | — | | | | — | | | | — | | | | | | 29,353 | | | | 594,398 | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 17,849 | | | | 98,348 | | | | | | | | | | | 3/3/2019 | | | 43,926 | | | | 96,625 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | 3/10/2020 | (6) | | 60,428 | | | | 132,936 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 35,697 | | | | 722,864 | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 46,053 | | | | 253,752 | | | | | | | | | | | 3/10/2020 | (6) | | 108,768 | | | | 84,596 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 62,950 | | | | 346,855 | | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 69,080 | | | | 1,398,870 | | | | | | | | | | 3/10/2021 | (6) | | 40,577 | | | | 31,590 | | | | 21.26 | | | | 3/9/2031 | | | | | | — | | | | — | | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 94,425 | | | | 1,912,106 | | | | | | | | | | 3/10/2021 | | | | — | | | | — | | | | — | | | | — | | | | | | 30,869 | | | | 170,088 | | | | | | | | | | | 3/10/2021 | (6) | | 72,136 | | | | | | 21.26 | | | | 3/9/2031 | | | | | | — | | | | — | | | | | | | | | | 3/25/2022 | | | 111,548 | | | | — | | | | 13.39 | | | | 3/24/2032 | | | | | | | | | | | | | | | | | 3/10/2021 | | | | | | — | | | | — | | | | — | | | | | | 41,158 | | | | 833,450 | | | | | | | | | | 3/25/2022 | | | | — | | | | — | | | | — | | | | — | | | | | | 197,964 | | | | 1,090,782 | | Jonathan Coblentz | | | | | | | | | 7/2/2012 | | | | — | | | | 78,770 | | | | 1.32 | | | | 8/1/2022 | | | | | | — | | | | — | | | | | | | | | | 7/25/2013 | | | | — | | | | 4,545 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | | 7/25/2013 | | | | — | | | | 4,545 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | 9/24/2014 | | | | — | | | | 26,588 | | | | 10.23 | | | | 9/28/2024 | | | | | | — | | | | — | | | | | | | | | | | 9/24/2014 | | | | — | | | | 36,363 | | | | 10.23 | | | | 9/28/2024 | | | | | | — | | | | — | | | | | | | | | | 11/30/2016 | | | | — | | | | 34,090 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | | 11/30/2016 | | | | — | | | | 34,090 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | 3/3/2019 | | | 2,942 | | | | 43,908 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | | 8/30/2018 | | | | — | | | | — | | | | — | | | | — | | | | | | 9,225 | | | | 186,806 | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 5,950 | | | | 32,785 | | | | | | | | | | | 3/3/2019 | | | 14,650 | | | | 32,200 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | 3/10/2020 | (6) | | 20,719 | | | | 45,578 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 11,899 | | | | 240,955 | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 15,790 | | | | 87,003 | | | | | | | | | | | 3/10/2020 | (6) | | 37,293 | | | | 29,004 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 21,583 | | | | 118,922 | | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 23,685 | | | | 479,621 | | | | | | | | | | 3/10/2021 | (6) | | 13,913 | | | | 10,820 | | | | 21.26 | | | | 3/9/2031 | | | | | | — | | | | — | | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 32,375 | | | | 655,594 | | | | | | | | | | 3/10/2021 | | | | — | | | | — | | | | — | | | | | | | | 10,584 | | | | 58,318 | | | | | | | | | | | 3/10/2021 | (6) | | 24,733 | | | | — | | | | 21.26 | | | | 47,916.00 | | | | | | — | | | | — | | | | | | | | | | 3/25/2022 | | | 35,058 | | | | — | | | | 13.39 | | | | 3/24/2032 | | | | | | — | | | | — | | | | | | | | | | | 3/10/2021 | | | | — | | | | — | | | | — | | | | — | | | | | | 14,112 | | | | 285,768 | | | | | | | | | | 3/25/2022 | | | | — | | | | — | | | | — | | | | — | | | | | | 62,218 | | | | 342,821 | | Patrick Kirscht | | | | | | | | | 12/4/2012 | | | | — | | | | 11,378 | | | | 1.87 | | | | 12/3/2022 | | | | | | — | | | | — | | | | | | | | | | 7/25/2013 | | | | — | | | | 22,727 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | | 7/25/2013 | | | | — | | | | 22,727 | | | | 4.40 | | | | 7/24/2023 | | | | | | — | | | | — | | | | | | | | | | 8/10/2013 | | | | — | | | | 45,454 | | | | 4.40 | | | | 8/9/2023 | | | | | | | | | | | | | | | | | 8/10/2013 | | | | — | | | | 45,454 | | | | 4.40 | | | | 8/9/2023 | | | | | | — | | | | — | | | | | | | | | | 9/24/2014 | | | | — | | | | 36,363 | | | | 10.23 | | | | 9/28/2024 | | | | | | — | | | | — | | | | | | | | | | | 9/24/2014 | | | | — | | | | 36,363 | | | | 10.23 | | | | 9/28/2024 | | | | | | — | | | | — | | | | | | | | | | 7/31/2015 | | | | — | | | | 54,545 | | | | 26.73 | | | | 9/28/2025 | | | | | | — | | | | — | | | | | | | | | | | 7/31/2015 | | | | — | | | | 54,545 | | | | 26.73 | | | | 9/28/2025 | | | | | | — | | | | — | | | | | | | | | | 11/30/2016 | | | | — | | | | 45,453 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | | 11/30/2016 | | | | — | | | | 45,453 | | | | 19.69 | | | | 11/29/2026 | | | | | | — | | | | — | | | | | | | | | | 3/3/2019 | | | 4,397 | | | | 65,878 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | | 8/30/2018 | | | | — | | | | — | | | | — | | | | — | | | | | | 12,580 | | | | 254,745 | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 8,925 | | | | 49,177 | | | | | | | | | | | 3/3/2019 | | | 21,965 | | | | 48,310 | | | | 18.04 | | | | 6/27/2029 | | | | | | — | | | | — | | | | | | | | | | 3/10/2020 | (6) | | 25,898 | | | | 56,973 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | | 3/3/2019 | | | | — | | | | — | | | | — | | | | — | | | | | | 17,849 | | | | 361,442 | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 19,737 | | | | 108,751 | | | | | | | | | | | 3/10/2020 | (6) | | 46,616 | | | | 36,255 | | | | 19.00 | | | | 3/9/2030 | | | | | | — | | | | — | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 26,979 | | | | 148,654 | | | | | | | | | | | 3/10/2020 | | | | — | | | | — | | | | — | | | | — | | | | | | 29,606 | | | | 599,522 | | | | | | | | | | 3/10/2021 | (6) | | 17,391 | | | | 13,525 | | | | 21.26 | | | | 3/9/2031 | | | | | | | | | | | | | | | | | 9/10/2020 | (7) | | | — | | | | — | | | | — | | | | — | | | | | | 40468 | | | | 819,477 | | | | | | | | | | 3/10/2021 | | | | — | | | | — | | | | — | | | | — | | | | | | 13,230 | | | | 72,897 | | | | | | | | | | | 3/10/2021 | (6) | | 30,916 | | | | — | | | | 21.26 | | | | 3/9/2031 | | | | | | 17,639 | | | | 357,190 | | | | | | | | | | 3/25/2022 | | | 47,807 | | | | — | | | | 13.39 | | | | 3/24/2032 | | | | | | | | | | | | | | | | | 3/10/2021 | | | | | | | | | | | | | | | | | | | | | | | | 3/25/2022 | | | | | | | | | | | | | | 84,842 | | | | 467,479 | |
| | |
| | 5150 |
(1) |
| Awards with a vesting commencement date on or prior to July 31, 2015 were granted under our 2005 Plan, awards with vesting commencement date after July 31, 2015, but on or prior to September 26, 2019, were granted under our 2015 Stock Option/Stock Issuance Plan. Awards with a vesting commencement date after September 26, 2019 were granted under our 2019 Equity Incentive Plan. |
(2) | Each option grant provides for a four-year vesting schedule, with one-fourth of the optionsunderlying shares vesting on the firstone-year anniversary of the vesting commencement date, and the balance vesting in equal monthly installments over the remaining 36 months, in each case subject to the executive’s continued service on each suchthrough the applicable vesting date. Except as noted below,with respect to stock options granted under our 2019 Equity Incentive Plan, options are exercisable immediately following grant, also known as “early exercisable,” and unvested shares purchased on an early exercise are subject to a repurchase right in our favor on termination of employment that lapses along the same vesting schedule as contained in the option grant. This column reflects the number of unexercised options that were unvested as of December 31, 2021.2022. |
(3) |
| This column reflects the number of shares subject to unexercised options that were vested as of December 31, 2021.2022. |
(4) | Except as otherwise noted, RSUs include both service-based and performance conditions to vest in the underlying shares of common stock, and require that the executive remains employed through the date upon which both vesting criteria are met. The RSUs will vest over a four-year period with one-fourth of the RSUs vesting on each one year anniversary of the vesting commencement date, subject to the executive’s continued service on each such vesting date. There is no outstanding performance-based vesting condition associated with such RSUs.
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(5) | Represents the number of unvested shares underlying RSUs multiplied by the per share fair market value of our common stock as of December 31, 2021, which was $20.25.2022, based on the closing price of our common stock of $5.51 per share. |
(6) | Stock options granted under our 2019 Equity Incentive Plan are not early exercisable. |
(7) | Includes “pull-forward” grants awarded in September 2020 where the grant pulled forward 50% of the annual grant value that otherwise would have been awarded as part of the annual review process in March 2021, with the remainder issued as equity grantsawards of stock options and RSUs in March 2021. |
Option Exercises and Stock Vested in Fiscal Year 20212022 The following table presents information concerning the aggregate value and number of shares of our common stock for which options were exercised or RSUs vested during 20212022 for each of the NEOs: | | | | | | | | | | | | | Option Awards | | | | | | Stock Awards | | | | Option Awards | | | | | | Stock Awards | | | Name | | | | | | | | | | Number of Shares Acquired on Exercise (#) | | Value Realized on Exercise ($) | | | | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($)(3) | | | | | | | | | | | Number of Shares Acquired on Exercise (#) | | Value Realized on Exercise ($)(1) | | | | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($)(5) | | | Raul Vazquez | | | | | | | | | | | — | | | | — | | | | | | 130,250 | | | | 2,867,342 | | | | | | | | | | | | 791,318 | (2) | | | 9,701,559 | | | | | | 111,992 | | | | 1,062,742 | | | Jonathan Coblentz | | | | | | | | | | | 46,200 | | | | 1,072,266 | (1) | | | | | 43,478 | | | | 955,744 | | | | | | | | | | | | 88,545 | (3) | | | 967,532 | | | | | | 37,389 | | | | 357,230.22 | | | Patrick Kirscht | | | | | | | | | | | 12,138 | | | | 232,945 | (2) | | | | | 44,860 | | | | 1,011,487 | | | | | | | | | | | | 11,378 | (4) | | | 106,747 | | | | | | 49,271 | | | | 475,484 | |
(1) | Reflects six option exercises in August, November and December 2021 which all had a $1.32 per share exercise price. The value realized on exercise was determined based on a fair market value of Oportunthe Company stock on the date of the exercise.
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(2) | Mr. Vazquez chose to net settle his shares upon exercise, surrendering to the Company 423,170 shares of the 791,318 vested options to cover the exercise price and applicable tax withholding. |
(3) | Reflects three option exercises in March 2022 for an aggregate 88,545 shares with a weighted average per share exercise price of $2.30. For one option exercise, Mr. Coblentz chose to net settle his shares upon exercise, surrendering to the Company 24,506 shares of the 58,770 vested shares that were exercised under the option to cover the exercise price and applicable tax withholding. |
(4) | Reflects two option exercises in July 2021 withMarch and November 2022, which all had a weighted average $1.48 per share exercise price. The value realized on exercise was determined based on a fair market valueprice of Oportun stock on the date of the exercise.$1.87. |
(3)(5) | The number of shares and value realized on vesting include shares that were withheld or sold at the time of vesting to satisfy tax withholding requirements. |
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Employment, Severance and Change in Control Agreements In November 2018, in connection with the compensation and leadership committee’s review of the overall compensatory package of each officer, our board of directors approved a new form of executive offer letter and executive severance and change in control policy for our executive officers. In February 2019, weWe previously entered into amended and restated offer letters with each of our NEOs. The offer lettersNEOs that generally provide for at-will employment and set forth the executive’s base salary, eligibility for an annual incentive award opportunity and employee benefits, and coverage under our executive severance policy. Each of our NEOs has also executed our standard form of proprietary information and invention assignment agreement. General provisions of these agreements are discussed below, and any potential payments and benefits due upon a termination of employment or a change in control are further quantified below in “Potential Payments and Benefits Upon Termination or Change in Control.”
Executive Severance and Change in Control Policy As discussed above, we adoptedWe maintain an executive severance and change in control policy, which supersedes the individual severance arrangements previously entered into withcovers each of our NEOs and is incorporated by reference into each NEO’s current offer letter.NEOs.
Upon a termination of employment by us without cause or by the executive for good reason (an “involuntary termination”), our NEOs other than our CEO will receive 12 months of salary continuation and continuation of health insuranceplan benefits at no cost under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) if they have been employed with us for at least five years (or nine months of such benefits if they have been employed for less than five years). If the termination occurs withinduring the period beginning 90 days before, orthrough 12 months after, aour change in control (the “change in control period”), they will receive the higher level of salary continuation and health insurance benefits regardless of their tenure with us, their full target bonus, and full vesting of their unvested equity awards other than performance-vested awards. For performance-vested awards, any acceleration of vesting, exercisability or lapse of restrictions is based on actual performance through the date of such change in control. As of December 31, 2022, the last day of the most recently completed fiscal year, each of Messrs. Coblentz and Kirscht had completed at least five years of employment with us. On an involuntary termination, our CEO will receive 18 months of salary continuation and continuation of health insuranceplan benefits at no cost under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) if he has been employed with us for at least five years (or 12 months of such benefits if he has been employed for less than five years), and 12 months’ worth of accelerated vesting of equity awards other than performance-vested awards. If the involuntary termination occurs within the change in control period, he will receive the higher level of salary continuation and health insurance benefits regardless of his tenure with us, 150% of his target bonus, and full vesting of his unvested equity awards other than performance-vested awards. For performance-vested awards, any acceleration of vesting, exercisability or lapse of restrictions is based on actual performance through the date of such change in control. As of December 31, 2022, the last day of the most recently completed fiscal year, our CEO had completed at least five years of employment with us. Severance benefits are subject to the execution of a release of claims by the executive, resignation from all officer and director positions, and continued compliance with the executive’s obligations under any confidentiality, intellectual property assignment, non-solicitationand restrictive covenant agreement with us. The terms “cause,” good“good reason” and “change in control” can be found in the executive severance policy. If payment payablethe payments and benefits under our executive severance and change in control policy would be subject to excise taxes underconstitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code and would be subject to the related excise tax, such payments either will be reducedpaid in full or as to such lesser amount that would result in no portion of the extent necessarypayments and benefits being subject to ensure paymentsuch excise tax, whichever results in the greater amount of after-tax benefits to the NEO of the greater of (i) the amount which would not constitute a parachute payment under Section 280G of the Internal Code or (ii) the amount which yields the greatest after-tax amount of benefits after taking into account any applicable excise tax. Our executive severance and change in control policy does not provide for any Internal Revenue Code Section 280G-related tax gross-up payments from the Company. | | |
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Potential Payments and Benefits Upon Termination or Change in Control The following table sets forth the estimated payments and benefits that would be received by each of the NEOs upon a termination of employment without cause or following a resignation for good reason which we refer to below as an involuntary termination, or in the event of an involuntary termination in connection with a change in control of Oportun. This table reflects amounts payable to each NEO assuming his or her employment was terminated on December 31, 2021,2022, and the change in control also occurred on that date. The listed amounts are gross amounts, before deducting any expenses or taxes. For additional discussion of the potential benefits and payments due in connection with a termination of employment or a change in control, please see “Employment, Severance, and Change in Control Agreements—Executive Severance and Change in Control Policy” above. | | | | Name | | | | | | Involuntary Termination (1)(2) ($) | | Change in Control Involuntary Termination (1)(2) ($) | | | | | | | Involuntary Termination Other than During Change in Control Period (1)(2) ($) | | Involuntary Termination During Change in Control Period (1)(2) ($) | | Raul Vazquez | | | | | | | | | | | | | | | | | Cash Severance | | | | | | 900,000 | | | 900,000 | | | Annual Incentive Award | | | | | | | — | | | 900,000 | | | Salary Severance | | | | | | | 1,125,000 | | | 1,125,000 | | Bonus Severance | | | | | | | | — | | | 1,125,000 | | Continuation of Health Insurance Benefits | | | | | | 24,436 | | | 24,436 | | | | | | | 25,883 | | | 25,883 | | Accelerated Vesting of Equity Awards | | | | | | 2,197,561 | | | 4,861,275 | | | | | | | 728,042 | | | 1,959,824 | | Total | | | | | | 3,121,997 | | | 6,685,711 | | | | | | | 1,878,925 | | | 4,235,707 | | Jonathan Coblentz | | | | | | | | | | | | | | | | | Cash Severance | | | | | | 387,002 | | | 387,002 | | | Annual Incentive Award | | | | | | | — | | | 251,551 | | | Salary Severance | | | | | | | 421,832 | | | 421,832 | | Bonus Severance | | | | | | | | — | | | 274,191 | | Continuation of Health Insurance Benefits | | | | | | 8,118 | | | 8,118 | | | | | | | 8,936 | | | 8,936 | | Accelerated Vesting of Equity Awards | | | | | | | — | | | 2,396,808 | | | | | | | | — | | | 639,849 | | Total | | | | | | 395,120 | | | 3,043,479 | | | | | | | 430,768 | | | 1,344,808 | | Patrick Kirscht | | | | | | | | | | | | | | | | | Cash Severance | | | | | | 446,706 | | | 446,706 | | | Annual Incentive Award | | | | | | | — | | | 290,359 | | | Salary Severance | | | | | | | 473,508 | | | 473,508 | | Bonus Severance | | | | | | | | — | | | 307,780 | | Continuation of Health Insurance Benefits | | | | | | 22,482 | | | 22,482 | | | | | | | 24,860 | | | 24,860 | | Accelerated Vesting of Equity Awards | | | | | | | — | | | 2,898,682 | | | | | | | | — | | | 846,959 | | Total | | | | | | 469,188 | | | 3,658,229 | | | | | | | 498,368 | | | 1,653,107 | |
(1) | Based on salary and target bonus targetsamounts as of December 31, 2021.2022. |
(2) | The estimated value of accelerated vesting of equity awards was calculated by multiplying the number of shares underlying the unvested option or RSU awards that would be accelerated by the per share fair market value of our common stock as of December 31, 2021,2022, which was $20.25,$5.51, minus the aggregate exercise price attributable to the accelerated shares in the case of ana stock option. OptionsStock options that have a per share exercise price above $20.25$5.51 are assumed to have no value. |
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Equity Compensation Plan Information The following table provides information as of December 31, 20212022 with respect to shares of our common stock that may be issued under our existing equity compensation plans: | | | | Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Restricted Stock Units and Rights (#) | | Weighted Average Exercise Price of Outstanding Options ($) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column) (#) | | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Restricted Stock Units and Rights (#) | | Weighted Average Exercise Price of Outstanding Options (1) ($) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column) (#) | | | Equity compensation plans approved by security holders | | | | | | | | | | | | | | 2019 Equity Incentive Plan(2) | | | 3,376,470 | | | | 19.64 | | | | 1,578,249 | | | | 3,691,145 | | | | 16.93 | | | | 1,791,251 | | | 2015 Stock Option / Stock Issuance Plan | | | 2,120,435 | | | | 20.73 | | | | — | | | | 1,588,971 | | | | 20.58 | | | | — | | | 2005 Stock Option / Stock Issuance Plan | | | 1,660,015 | | | | 5.87 | | | | — | | | | 605,086 | | | | 12.32 | | | | — | | | 2019 Employee Stock Purchase Plan(3) | | | — | | | | — | | | | 1,273,009 | | | | — | | | | — | | | | 1,593,052 | | | 2021 Inducement Equity Incentive Plan | | | 385,268 | | | | | | 269,732 | | | | 524,320 | | | | | | 39,635 | | | Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | Total | | | 7,542,188 | | | | | | 3,120,990 | | | | 6,409,522 | | | | | | 3,423,938 | |
(1) | RSUs, which do not have an exercise price, are excluded in the calculation of weighted-average exercise price. |
(2) | Our 2019 Equity Incentive Plan (“2019 Plan”) provides that the number of shares of common stock available for issuance under the 2019 Plan automatically increases on the first day of each fiscal year beginning with the 2020 fiscal year, in an amount equal to the least of five percent (5%) of the outstanding shares of our common stock on the last day of the immediately preceding fiscal year. The Board may act prior to the first day of any fiscal year to provide that the increase in the share reserve for such fiscal year will be a lesser number of shares. |
(3) | Our 2019 Employee Stock Purchase Plan (“ESPP”) provides that the number of shares of common stock available for issuance under the ESPP automatically increases on the first day of each fiscal year beginning with the 2020 fiscal year, in an amount equal to the least of (i) one percent (1%) of the outstanding shares of our common stock on the last day of the immediately preceding fiscal year or (ii) 726,186 shares. The Board may act prior to the first day of any fiscal year to provide that there will be no increase in the share reserve for such fiscal year or that the increase in the share reserve for such fiscal year will be a lesser number of shares. |
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Report of the Compensation and Leadership Committee The information contained in this report of the compensation and leadership committee shall not be deemed to be “soliciting material,” “filed” with the SEC, subject to Regulations 14A or 14C of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or subject to the liabilities of Section 18 of the Exchange Act. No portion of this compensation and leadership committee report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, through any general statement incorporating by reference in its entirety the proxy statement in which this report appears, except to the extent that the Company specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed filed under either the Securities Act or the Exchange Act. The compensation and leadership committee has reviewed and discussed with management the “Executive Compensation” section contained in this proxy statement. Based on this review and discussion, the compensation and leadership committee has recommended to the Board that the “Executive Compensation” section be included in this proxy statement and incorporated into Oportun’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.2022. Respectfully submitted by the members of the compensation and leadership committee of the Board: Frederic Welts (Chair) Aida M. AlvarezRoy Banks
Ginny Lee Carl Pascarella David Strohm
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Pay Versus Performance Our executives’ pay is variable and linked to our business and financial performance. More than 75% of their compensation is in the form of equity, which aligns their interests with our stockholders’ and results in their compensation actually paid being impacted by our stock performance. The factors considered by the compensation and leadership committee to determine the compensation of the NEOs and other officers is described in the section “Executive Compensation—Roles of the Compensation and Leadership Committee, Management and the Compensation Consultant—Role of the Compensation and Leadership Committee” of this proxy statement. In evaluating each executive’s performance, the compensation and leadership committee sets corporate goals that further the company’s long-term objectives to expand into new markets and grow market share. The compensation and leadership committee also sets financial performance targets to assess the company’s ongoing business and financial performance and operational efficiency. Between 2021 to 2022, we saw a decline in our Net Income and Total Stockholder Return, reflecting challenging macroeconomic conditions and stock price decline. Since the vast majority of our NEO compensation is in the form of equity, the decline in our stock price resulted in a corresponding decline in compensation actually paid to the NEOs. In accordance with the requirements of Item 402(v) of Regulation S-K, the following table provides information regarding the “compensation actually paid” to our principal executive officer (“PEO”) and our other NEOs (“non-PEO NEOs”) and certain financial performance results of the Company. | | | | | | | | | | | | | | | | | | | | | | | | | Year | | Summary Compensation Table Total for PEO (1) | | | Compensation Actually Paid to PEO (2) | | | Average Summary Compensation Table Total for non-PEO NEOs (3) | | | Average Compensation Actually Paid to non-PEO NEOs (4) | | | Value of Initial Fixed $100 Investment Based on Company Total Stockholder Return (5) | | | Net Income (millions) (6) | | 2022 | | $ | 4,765,924 | | | $ | (2,800,770 | ) | | $ | 1,998,769 | | | $ | (902,860 | ) | | $ | 28.45 | | | $ | (77.7 | ) | 2021 | | $ | 3,119,385 | | | $ | 3,733,111 | | | $ | 1,449,893 | | | $ | 1,683,680 | | | $ | 104.54 | | | $ | 47.4 | |
(1) | Represents amounts reported in the “total” column of the Summary Compensation Table (SCT) for Raul Vazquez (our Chief Executive Officer). Mr. Vazquez was our PEO for each of the years shown. |
(2) | Represents dollar amount for Mr. Vazquez derived from the starting point of the compensation reported in the “total” column of the SCT, under the methodology prescribed under the SEC’s rules, as shown in the table below. The following table presents a reconciliation of total compensation paid to our PEO for each year shown as reported in the SCT, further above, to the compensation actually paid to our PEO, which was computed in accordance with Item 402(v) of Regulation S-K, as reported in the Pay Versus Performance table to which this footnote relates. |
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| | | | | | | | | Fiscal Year | | 2021 | | | 2022 | | SCT Total | | $ | 3,119,385 | | | $ | 4,765,924 | | - Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | | $ | (1,750,029 | ) | | $ | (3,525,743 | ) | + Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | | $ | 1,628,524 | | | $ | 1,330,204 | | + Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years | | $ | 202,733 | | | $ | (3,390,451 | ) | + Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | | $ | 0 | | | $ | 0 | | + Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years that Vested During Fiscal Year | | $ | 532,498 | | | $ | (1,980,704 | ) | - Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | | $ | 0 | | | $ | 0 | | Compensation Actually Paid | | $ | 3,733,111 | | | $ | (2,800,770 | ) |
(3) | Represents the averages of the amounts reported in the “total” column of the SCT for our non-PEO NEOs. Our non-PEO NEOs for 2022 and 2021 were Jonathan Coblentz and Patrick Kirscht. |
(4) | Represents dollar amounts on an averaged basis for our non-PEO NEOs derived from the starting point of the compensation reported in the “Total” column of the SCT, under the methodology prescribed under the SEC’s rules, as shown in the table below. The following table presents a reconciliation of the average total compensation paid to our non-PEO NEOs for each year shown as reported in the SCT, further above, to the average compensation actually paid to our non-PEO NEOs, which was computed in accordance with Item 402(v) of Regulation S-K, as reported in the Pay Versus Performance table to which this footnote relates |
| | | | | | | | | Fiscal Year | | 2021 | | | 2022 | | SCT Total | | $ | 1,449,893 | | | $ | 1,998,769 | | - Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | | $ | (675,024 | ) | | $ | (1,309,572 | ) | + Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | | $ | 628,157 | | | $ | 494,079 | | + Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years | | $ | 78,920 | | | $ | (1,318,650 | ) | + Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | | $ | 0 | | | $ | 0 | | + Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years that Vested During Fiscal Year | | $ | 201,734 | | | $ | (767,487 | ) | - Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | | $ | 0 | | | $ | 0 | | Compensation Actually Paid | | $ | 1,683,680 | | | $ | (902,860 | ) |
(5) | Represents value of initial $100 investment in Oportun stock on December 31, 2020, the last trading day prior to the earliest fiscal year shown in the table. |
(6) | Represents the Company’s net income reflected in the Company’s audited financial statements. |
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Relationship Between PEO and Non-PEO NEOs Compensation Actually Paid and Total Shareholder Return (“TSR”) The following graph sets forth the relationship between compensation actually paid (or “CAP”) to our PEO and the average of compensation actually paid to our non-PEO NEOs versus the Company’s cumulative TSR for the fiscal years shown. Relationship Between PEO and Non-PEO NEOs Compensation Actually Paid and Net Income (Loss) The following graph sets forth the relationship between compensation actually paid to our PEO and the average of compensation actually paid to our non-PEO NEOs versus our net income (loss) for the fiscal years shown. | | | | | 58 |
Certain Relationships and Related Transactions The following is a summary of transactions and arrangements, since the beginning of our last fiscal year, to which we have been a participant, in which the amount involved exceeded or will exceed the lesser of $120,000 or one percent of the average Company’s total assets at year-end for the last two completed fiscal years in which we were or are to be a participant and in which a related person had or will have a direct or indirect material interest. A related person is: (i) an executive officer, director or director nominee, (ii) a beneficial owner of more than 5% of our common stock, (iii) an immediate family member of an executive officer, director or director nominee or beneficial owner of more than 5% of our common stock, or (iv) any entity that is owned or controlled by any of the foregoing persons has a substantial ownership interest or control. Indemnification Agreements Our amended and restated certificate of incorporation contains provisions limiting the liability of our directors, and our amended and restated bylaws provide that we indemnify each of our directors to the fullest extent permitted under Delaware law. Our amended and restated certificate of incorporation and amended and restated bylaws also provide our Board with discretion to indemnify our officers and employees when determined appropriate by our Board. In addition, we have entered and expect to continue to enter into agreements to indemnify our directors and executive officers. Investors’ Rights Agreements We are party to an amended and restated investors’ rights agreement with certain purchasers of the Company’s preferred stock (which converted to common stock in our IPO), which provides, among other things, that certain holders of our capital stock, have the right to demand that we file a registration statement or request that their shares of our capital stock be included on a registration statement that we are otherwise filing. In connection with the acquisition of Hello Digit, Inc. (“Digit”) we entered into an investor rights agreement with the holders of Digit stock, pursuant to which the holders have certain “piggyback” registration rights with respect to registrations of equity securities initiated by the Company. Transactions with Credit Karma and Hummingbird Raul Vazquez is currently a member of the board of directors of Intuit Inc. (“Intuit”). On December 3, 2020, Intuit acquired Credit Karma. We have conducted business with Credit Karma for lead generation services since November 2019 and made payments to Credit Karma of approximately $5.9$8.9 million for services provided in 2021.2022. Mr. Vazquez is not involved in directly managing Credit Karma and these transactions with Credit Karma were entered into in the ordinary course of business. This transaction was approved in accordance with Oportun’s Related Person Transactions Policy. We entered into an agreement with Hummingbird RegTech, Inc. (“Hummingbird”), a provider of compliance software, in 2022 and made payments to them of approximately $178,000 in 2022. A member of our Board of Directors, Jo Ann Barefoot, is a co-founder and shareholder of Hummingbird. Ms. Barefoot is not involved in directly managing Hummingbird and these transactions were entered into in the ordinary course of business. This transaction was approved in accordance with Oportun’s Related Person Transactions Policy. Transactions with Affiliates of Ellington In November 2014 we entered into an agreement with ECL Funding, LLC, an entity affiliated with Ellington, to sell at least 10% of our unsecured loan originations, with an option to sell an additional 5%, subject to certain eligibility criteria and minimum and maximum volumes. We also entered into a Servicing Agreement pursuant to which we agreed to service the portfolio owned by Ellington Financial and in return earn a servicing fee of 5%. We chose not to renew the arrangement and allowed the agreement to expire on its terms on March 4, 2022. The originations of loans sold and held for sale during the year ended December 31, 2022, was $52.7 million. Our servicing fee revenue during 2022 was $17.4 million. | | | | | 59 |
In addition, in March 2022, we participated in a co-sponsored securitization transaction with certain other entities affiliated with Ellington and sold loans through the issuance of amortizing asset-backed notes secured by a pool of our unsecured and secured personal installment loans. We also sold our share of the residual interest in the pool. The sold loans had an aggregate unpaid principal balance of approximately $227.6 million. As of April 17, 2023, Ellington beneficially owned more than 5% of our common stock. Transactions with Neuberger Berman On September 14, 2022, we entered into an agreement to borrow $150.0 million of senior secured term loans from certain funds affiliated with Neuberger Berman Specialty Finance, beneficial owner of greater than five percent of our outstanding common stock (the “Corporate Facility”). On March 10, 2023 we upsized and amended the Corporate Facility (the “Amended Credit Agreement”) to be able to borrow up to an additional $75.0 million. We borrowed $20.8 million of term loans under the Amended Corporate Facility on March 10, 2023 (the “Incremental Tranche A-1 Loans”) and borrowed an additional $4.2 million of term loans under the Amended Corporate Facility on March 27, 2023 (the “Incremental Tranche A-2 Loans”). The term loans bear interest at an amount equal to (a) 1-month term SOFR plus 9.00%, payable in cash, plus (b) 3.00%, payable in cash or in kind at our option. The term loans are scheduled to mature on September 14, 2026, and are not subject to amortization. Certain prepayments of the term loans are subject to a prepayment premium. The obligations under the Amended Corporate Facility are secured by our assets and assets of certain of our subsidiaries guaranteeing the Amended Corporate Facility, including pledges of the equity interests of certain subsidiaries that are directly or indirectly owned by us, subject to customary exceptions. We may borrow up to an aggregate additional amount of $50.0 million of term loans under the Amended Corporate Facility on an uncommitted basis in two additional $25.0 million tranches (the “Incremental Tranche B Loans” and “Incremental Tranche C Loans,” respectively. In connection with the Amended Credit Agreement, we issued warrants, at closing, to the lenders providing the Incremental Tranche A-1 Loans to purchase 1,980,242 shares of our common stock and on March 27, 2023, issued warrants to the lenders providing the Incremental Tranche A-2 Loans to purchase 116,485 shares of our common stock, in each case at an exercise price of $0.01 per share. In addition, in connection with the funding of the Incremental Tranche B Loans, we will issue warrants to the lenders providing the Incremental Tranche B Loans to purchase 1,048,363 shares of our common stock and, in connection with the funding of the Incremental Tranche C Loans, we will issue warrants to the lenders providing the Incremental Tranche C Loans to purchase 1,048,363 shares of our common stock, in each case, at an exercise price of $0.01 per share. We also entered into a registration rights agreement with the applicable lenders, which stipulates that we file a registration statement with respect to the shares underlying the warrants. Policies and Procedures for Related Party Transactions We have adopted a policy that all transactions, arrangements, or relationships in which the amounts exceed $120,000 or one percent of the average Company’s total assets at year-end for the last two completed fiscal years between us and our directors, executive officers, holders of more than 5% of our capital stock, any member of the immediate family of the foregoing persons, or their affiliates are approved by the audit and risk committee, or a similar committee consisting of entirely independent directors, according to the terms of our codeCode of business conduct.Business Conduct. In approving or rejecting any such related party proposal, the audit and risk committee will consider the relevant facts and circumstances available and deemed to be relevant to the matter, including, but not limited to, risks, costs, impact on independence, availability of alternatives, and transaction terms that could have been obtained from unaffiliated third parties. | | |
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We believe that we have executed all the transactions described above on terms no less favorable to us than we could have obtained from unaffiliated third parties. It is out intent to ensure that all future transactions | | | | | 60 |
between us and related parties are also approved by the audit and risk committee, or a similar committee consisting of entirely independent directors, according to the terms of our codeCode of business conduct,Business Conduct, and are on terms no less favorable to us than those that we could obtain from unaffiliated third parties. Other Matters Annual Report on Form 10-K and SEC Filings We have filed our Annual Report on Form 10-K for the year ended December 31, 20212022 with the SEC. It is available free of charge at the SEC’s web site at www.sec.gov. Our Annual Report and this proxy statement are posted on our investor relations website at https://investor.oportun.com and are available from the SEC at its website at www.sec.gov. If you do not have access to the internet or have not received a copy of our Annual Report, you may request a copy of it or any exhibits thereto without charge by writing to our Corporate Secretary at Oportun Financial Corporation, 2 Circle Star Way, San Carlos, CA 94070. | | | 58
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Appendix: Reconciliation on Non-GAAP Financial Measures The proxy statement contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). Adjusted EBITDANet Income Adjusted Net Income is a non-GAAP financial measure defined as our net income, (loss), adjusted for the impact of our election of the fair value option and further adjusted to eliminate the effect ofexclude income tax expense, stock-based compensation expenses and certain items as described below.non-recurring charges. We believe that Adjusted EBITDANet Income is an important measure of operating performance because it allows management, investors, and our Board to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making the adjustments described below. In addition, it provides a useful measure for period-to-period comparisons of our business, as it removes the effect of taxes, certain non-cash items, variable charges and timing differences.period to period. We believe it is useful to exclude the impact of income tax expense (benefit), as reported, because historically it has included irregular income tax items that do not reflect our ongoing business operations. We believe it is useful to exclude the impact of depreciation and amortization and stock-based compensation expense because they are noncash charges.
We believe it is useful to exclude the impact of certain non-recurring charges, such as expenses associated with a litigation reserve, our retail network optimization plan, impairment charges and acquisition and integration related expenses, because these items do not reflect ongoing business operations. During the last three quarters of 2020 we excluded COVID-19 expenses in our adjustments to derive Adjusted EBITDA. As of January 1, 2021, COVID-19 expenses are no longer being excluded from Adjusted EBITDA because our business practices have been updated to operate in the current environment. We also reverse origination fees for Fair Value Loans, net. We recognize the full amount of any origination fees as revenue at the time of loan disbursement in advance of our collection of origination fees through principal payments. As a result, we believe it is beneficialuseful to exclude the uncollected portion of such origination fees, because such amounts do not represent cash that we received. We also reverse the fair value mark-to-market adjustmentstock-based compensation expense because it is a non-cash adjustment as showncharge.
We include the impact of normalized statutory income tax expense by applying the income tax rate noted in the table below.table. | | | | | | | | | | | Year Ended December 31, | | Components of Fair Value Mark-to-Market Adjustment - Fair Value Pro Forma (in thousands) | | 2021 | | | 2020 | | Fair value mark-to-market adjustment on Fair Value Loans | | $ | 57,044 | | | $ | (25,548 | ) | Fair value mark-to-market adjustment on asset-backed notes | | | 15,408 | | | | 2,804 | | Fair value mark-to-market adjustment on derivatives | | | (3,097 | ) | | | — | | Total fair value mark-to-market adjustment—Fair Value Pro Forma | | $ | 69,355 | | | $ | (22,744 | ) |
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The following table presents a reconciliation of net income (loss) to Adjusted EBITDANet Income for the years ended December 31, 20212022 and 2020 as if the fair value option had been in place since inception for all loans held for investment and all asset-backed notes:2021: | | | | | | | | | | | | | Year Ended December 31, | | Adjusted EBITDA (in thousands) | | 2021 | | | 2020 | | Net income (loss) | | $ | 47,414 | | | $ | (45,082 | ) | Adjustments: | | | | | | | | | Fair Value Pro Forma net income adjustment (1) | | | — | | | | 874 | | Income tax expense (benefit) | | | 15,377 | | | | (12,330 | ) | COVID-19 expenses (2) | | | — | | | | 4,632 | | Depreciation and amortization | | | 23,714 | | | | 20,220 | | Impairment (3) | | | 3,324 | | | | 3,702 | | Stock-based compensation expense | | | 18,857 | | | | 19,488 | | Litigation reserve | | | — | | | | 8,750 | | Retail network optimization expenses | | | 12,828 | | | | — | | Acquisition and integration related expenses | | | 10,648 | | | | — | | Origination fees for Fair Value Loans, net | | | (15,836 | ) | | | (900 | ) | Fair value mark-to-market adjustment | | | (69,355 | ) | | | 22,744 | | Adjusted EBITDA (4) | | $ | 46,971 | | | $ | 22,098 | |
| | | | | | | | | | | Year Ended December 31, | | Adjusted Net Income (in thousands) | | 2022 | | | 2021 | | Net income (loss) | | $ | (77,744 | ) | | $ | 47,414 | | Adjustments: | | | | | | | | | Income tax expense | | | 2,458 | | | | 15,377 | | Impairment | | | 108,472 | | | | 3,324 | | Stock-based compensation expense | | | 27,620 | | | | 18,857 | | Litigation reserve | | | 2,750 | | | | — | | Retail network optimization expenses | | | 1,882 | | | | 12,828 | | Acquisition and integration related expenses | | | 29,682 | | | | 10,648 | | Adjusted income before taxes | | | 95,120 | | | | 108,448 | | Normalized income tax expense | | | 25,682 | | | | 29,715 | | Adjusted Net Income | | $ | 69,438 | | | $ | 78,733 | | Income tax rate (1) | | | 27.0 | % | | | 27.4 | % |
(1) | Beginning in 2021 we are no longer including any Fair Value Pro Forma adjustments because all loans originated and heldIncome tax rates for investment and asset-backed notes issued are recorded at fair value.
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(2) | As of January 1, 2021, COVID-19 expenses are no longer being excluded from Adjusted EBITDA because our business practices have been updated to operate in the current environment.
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(3) | The impairment charge in 2021 was recognized on a right-of-use asset related to our leased office space in San Carlos, California due to management’s decision to move toward a remote-first work environment. The impairment charge in 2020 was recognized on fixed assets and system development costs associated with our direct auto product.
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(4) | For the yearyears ended December 31, 2021, Adjusted EBITDA includes a pre-tax impact of $28.8 million, related to the launch of new products2022 and services (such as secured personal loans, credit card, bank partnership and expenses associated with our bank charter application). For the year ended December 31, 2020, Adjusted EBITDA included2021, are based on a pre-tax impact of $18.2 million related to the launch of new products and services (such as direct auto and credit card).normalized statutory rate.
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Adjusted Operating Efficiency Adjusted Operating Efficiency is a non-GAAP financial measure defined as total operating expenses adjusted to exclude stock-based compensation expense and certain non-recurring charges such as expenses associated with a litigation reserve, our retail network optimization plan, impairment charges and acquisition and | | | 60
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integration related expenses divided by total revenue. We believe Adjusted Operating Efficiency is an important measure because it allows management, investors and our Board to evaluate how efficiently we manage costs relative to revenue. The following table presents a reconciliation of Operating Efficiency to Adjusted Operating Efficiency for the years ended December 31, 2022 and 2021: | | | | | | | | | | | | | As of or for the Year Ended December 31, | | (in thousands) | | 2022 | | | 2021 | | Operating Efficiency | | | 75.2 | % | | | 74.6 | % | Adjusted Operating Efficiency | | | | | | | | | Total revenue | | $ | 952,545 | | | $ | 626,782 | | Total operating expense | | | 715,943 | | | | 467,690 | | Impairment | | | (108,472 | ) | | | (3,324 | ) | Stock-based compensation expense | | | (27,620 | ) | | | (18,857 | ) | Litigation reserve | | | (2,750 | ) | | | — | | Retail network optimization expenses | | | (1,882 | ) | | | (12,828 | ) | Acquisition and integration related expenses | | | (29,682 | ) | | | (10,648 | ) | Total adjusted operating expenses | | $ | 545,537 | | | $ | 422,033 | | Adjusted Operating Efficiency | | | 57.3 | % | | | 67.3 | % |
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SAN CARLOS, CA 94070 Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 8:59 p.m. Pacific Time on June 13, 2022.5, 2023. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During the Meeting - Go to www.virtualshareholdermeeting.com/OPRT2022 OPRT2023 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 8:59 p.m. Pacific Time on June 13, 2022.5, 2023. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. We must receive it by June 13, 20225, 2023 for your vote to be counted. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
D84631-P73175 V03782-P89932 KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY OPORTUN FINANCIAL CORPORATION The Board of Directors recommends you vote FOR each of the Nominees listed in proposal 1, and FOR proposals 2 and 3: 1. Election of Class IIII Directors to serve until the 20252026 Annual Meeting of Stockholders Nominees: For Withhold 1a. Carl Pascarella ! ! Jo Ann Barefoot 1b. Raul Vazquez ! !
1c. R. Neil Williams ! !Sandra A. Smith For Against Abstain 2. Ratification of the selection of Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2022. ! ! ! 2023. 3. To approve, on an advisory non-binding basis, the named executive officer compensation, as described in the proxy statement. ! ! ! NOTE: In their discretion, the proxy holders will vote on such other business as may properly come before the meeting or any adjournments or postponements thereof. HOUSEHOLDING ELECTION - Please indicate if you consent to receive certain future investor communications in a single package per household. Yes No Please sign exactly as your name(s) appear(s) hereon. When Yes No signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each HOUSEHOLDING ELECTION - Please indicate if you consent ! ! sign personally. All holders must sign. If a corporation or to receive certain future investor communications in a single partnership, please sign in full corporate or partnership name by package per household. authorized officer. Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Combined Document is available at www.proxyvote.com.
D84632-P73175 OPORTUN FINANCIAL CORPORATION Annual Meeting of Stockholders June 14, 20226, 2023 8:00 a.m. Pacific Time This proxy is solicited by the Board of Directors The stockholder(s) hereby appoint(s) Raul Vazquez, Jonathan Coblentz and Joan Aristei, and each of them, as proxies and attorneys-in-fact, each with full power of substitution, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of common stock of OPORTUN FINANCIAL CORPORATION that the stockholder(s) is/are entitled to vote at the Annual Meeting of Stockholders to be held at 8:00 a.m. Pacific Time on June 14, 2022,6, 2023, virtually at www.virtualshareholdermeeting.com/OPRT2022,OPRT2023, and any adjournment or postponement thereof. This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the recommendations of the Board of Directors. Continued and to be signed on reverse side
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