Steven Shelton
About Steven Shelton
Steven E. Shelton, age 64, is Director and Chief Executive Officer of California BanCorp (BCAL) and California Bank of Commerce, N.A., serving in the CEO role effective July 31, 2024; he has served as a director since 2024. He previously served as CEO of California Bank of Commerce and director of California BanCorp (CALB) from 2018 through July 2024; he was a founding executive of California Bank of Commerce in 2007 and began his banking career in 1983 at Bank of America, followed by 13 years in executive roles at CivicBank of Commerce in Oakland, CA. He holds a B.S. in Business Administration and Finance from California State University, Fresno, and an MBA in Management from Golden Gate University .
Note: The proxy does not disclose TSR, revenue growth, or EBITDA growth for Mr. Shelton’s tenure.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| California Bank of Commerce | Founding executive | 2007 onward | Founding leader; contributed to growth and operations of the commercial bank . |
| California Bank of Commerce; California BanCorp (CALB) | Chief Executive Officer (CBofC); Director (CALB) | 2018–Jul 2024 | Led the bank and served on holding company board prior to the 2024 merger . |
| CivicBank of Commerce (Oakland, CA) | Various executive management positions | ~13 years (prior to 2007) | Executive leadership experience in commercial banking . |
| Bank of America | Relationship management | Began 1983 | Entry into commercial banking; foundation of 40-year career . |
External Roles
No other public company directorships or external roles for Mr. Shelton are disclosed in the proxy. Skipped per instruction (not disclosed) .
Fixed Compensation
| Item | 2024 Amount | Notes |
|---|---|---|
| Base salary (actual paid in 2024) | $262,881 | Partial-year given CEO appointment effective July 31, 2024 . |
| Base salary (per employment agreement) | $610,000 | Annual base; subject to review and adjustment but not reduction . |
| Annual bonus (2024) | $0 | No bonus paid for 2024 . |
| Stock awards (grant date fair value, 2024) | $500,004 | Grant in connection with employment; RSUs vesting per schedules below . |
| Other annual compensation (2024) | $387,481 | Includes $355,485 stock option payout due to merger; memberships; life and health premiums; 401(k) match; car allowance . |
| Car allowance | $1,500 per month | Provided under employment agreement . |
Performance Compensation
- Annual bonus program primarily based on Company meeting or exceeding pre-established performance targets such as return on average assets and asset quality; executives participate via the Management Incentive Plan assessed on financial metrics (e.g., pre-tax, pre-provision revenue and asset quality) and non-financial metrics (e.g., strategic objectives and risk management) .
- Equity incentives granted to align management and shareholders; awards granted at CNG Committee discretion under the 2019 Omnibus Equity Compensation Plan and assumed CALB 2017 plan awards following the merger .
Equity Ownership & Alignment
Beneficial Ownership (as of March 27, 2025)
| Holder | Shares Owned | RSUs vesting within 60 days | Total Beneficially Owned | % of Class |
|---|---|---|---|---|
| Steven E. Shelton | 80,411 | 540 | 80,951 | 0.25% |
- Anti-hedging policy prohibits hedging and short sales; pledging is only allowed with approval. As of the proxy date, no directors or executive officers had outstanding pledges (reduces alignment risk from collateralized borrowing) .
- Stock ownership guidelines: CEO expected to own Company stock equal to at least 3x base salary; new executive officers are expected to meet the threshold within three years of appointment (compliance status not disclosed) .
Outstanding Equity Awards (Not Vested) as of December 31, 2024
| Grant Date | Units Not Vested | Market Value at 12/31/2024 | Vesting Start | Schedule |
|---|---|---|---|---|
| 7/31/2024 (assumed from merger) | 6,371 | $105,376 | 9/21/2024 | Equal quarterly installments through 6/21/2028 . |
| 7/31/2024 (assumed from merger) | 541 | $8,948 | 3/19/2025 | Equal installments over one year . |
| 7/31/2024 (assumed from merger) | 3,625 | $59,958 | 3/8/2025 | Equal installments over two years . |
| 7/31/2024 (assumed from merger) | 1,622 | $26,828 | 4/12/2025 | Equal installments over three years . |
| 7/31/2024 (assumed from merger) | 2,162 | $35,759 | 7/27/2025 | Equal installments over four years . |
| 7/31/2024 (assumed from merger) | 11,358 | $187,861 | 3/25/2025 | Equal installments over five years . |
| 8/2/2024 (employment agreement grant) | 32,680 | $540,527 | 8/2/2025 | Equal installments over three years . |
Note: The Company’s Clawback Policy applies to incentive compensation awarded or received in the three years preceding any accounting restatement; recovery may include excess incentive compensation and gains from vesting/exercise/sale of equity awards .
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment term | Four years beginning July 31, 2024; one additional year thereafter absent termination notice . |
| Base salary | $610,000 annually; reviewable and adjustable, but not reducible . |
| Initial RSU grant | $500,000 equivalent; vesting ratably (proxy disclosures reflect specific schedules by grant) . |
| Severance (first 3 years if terminated without cause or resigns for good reason) | Receives change-in-control benefit under former CALB agreement: 24 months of then-current base salary + average of three most recent annual bonuses; acceleration of vesting of all outstanding and unvested stock awards held at the merger closing (no other severance plan/policy applies; acceleration limited to pre-merger equity) . |
| Severance (after third anniversary of merger) | Lump sum equal to base salary in effect at termination + Company-paid group healthcare coverage for up to 12 months or until eligible elsewhere . |
| Change-in-control | If terminated or resigns for good reason in context of change-in-control or if a change-in-control is announced and consummates: 24 months of then-current base salary + two times average annual bonus over prior three years + six months health insurance premiums + an amount equal to six months of COBRA premiums for himself and dependents . |
| 280G | “Best-net cutback” applies—payments reduced to avoid excise tax if reduction yields greater after-tax value; otherwise paid in full . |
| Benefits | Eligible for group medical and life insurance; $1,500 monthly auto allowance . |
| SERP and split-dollar | SERP (originally May 7, 2018) assumed from CALB; Targeted Benefit Amount increased to 30% from 25%; projected ~$2.9 million when fully vested after 10 years; present value of vested accrued benefit was $1.4 million as of 12/31/2024; split-dollar agreement provides beneficiary payout from BOLI; benefit valued at $1.35 million as of 12/31/2024 . |
Board Governance
- Board service: Director since 2024; CEO and director dual role; Board separates Chairman and CEO roles (Chairman is Executive Chair David I. Rainer), with a Lead Independent Director (Stephen A. Cortese) to ensure independent oversight .
- Committees: Mr. Shelton is not listed as a member of the Audit & Risk Committee or the Compensation, Nominating & Governance (CNG) Committee; both committees are fully independent and chaired by independent directors .
- Independence: The Board determined Mr. Shelton is not independent due to his employee status (CEO) .
- Board functioning: 22 Board meetings held in 2024; separate sessions of independent directors held regularly; each director attended at least 75% of Board and applicable committee meetings .
- Director compensation: As CEO, Mr. Shelton receives no additional compensation for director service .
Equity Ownership & Alignment Details
- Stock ownership guidelines: CEO is expected to hold Company stock valued at least 3x base salary within three years of appointment (compliance status not disclosed) .
- Anti-hedging/pledging: Hedging and short sales prohibited; pledging permitted only with approval; no outstanding pledges reported as of proxy date .
Compensation Structure Analysis
- Cash vs equity mix: 2024 compensation for Mr. Shelton was heavily equity/other-driven due to merger-related items—$500,004 in stock awards and $387,481 other compensation (including a $355,485 stock option payout), versus $262,881 salary; no cash bonus paid in 2024 .
- Incentive metrics: Short-term incentives emphasize return on average assets and asset quality; comprehensive MIP includes pre-tax, pre-provision revenue, asset quality, strategic objectives, and risk management, aligning pay with performance outcomes .
- Clawback: Robust clawback policy tied to restatements and equity award gains improves pay-for-performance alignment and risk controls .
- Options: No outstanding option awards were disclosed for Mr. Shelton; equity compensation is primarily RSUs with multi-year vesting .
Vesting Schedules and Insider Selling Pressure
- Upcoming vesting creates potential supply: Multiple RSU tranches vest quarterly and annually from March 2025 to June 2028; notable near-term vesting includes 541 units over one year from March 19, 2025 and additional tranches starting March–July 2025, potentially increasing tradable float for Mr. Shelton depending on 10b5‑1 plans and blackout windows .
- Policy mitigants: Prohibitions on hedging/short sales and the absence of pledges reduce forced-selling risk; stock ownership guidelines encourage retention .
Director Compensation (for completeness; Mr. Shelton excluded)
- Non-employee director program effective Aug 8, 2024: Annual retainer $110,000 (half cash/half equity); committee chair/lead director additional monthly cash fees; RSUs vest annually and accelerate upon certain events .
- Mr. Shelton receives no extra compensation for board service (covered above) .
Related Party Transactions and Conflicts
- Related Party Transactions Policy: CNG Committee reviews for fairness and independence impacts; loans to employees not permitted; director loans comply with Regulation O .
- No specific related party transactions involving Mr. Shelton are disclosed; Company notes lease with former director and investor rights for Castle Creek; independence determinations maintained for committees .
Say-on-Pay & Shareholder Feedback
The 2025 proxy does not disclose prior say-on-pay vote percentages for BCAL. Skipped per instruction (not disclosed) .
Expertise & Qualifications
- Credentials: 40+ years in banking across relationship management and executive leadership; founding executive experience; formal finance and management education (BS, MBA) .
Work History & Career Trajectory
See Past Roles table; progression from relationship management at Bank of America to executive leadership at CivicBank and founding/CEO roles at California Bank of Commerce and California BanCorp (CALB) .
Compensation Committee Analysis
- CNG Committee independently oversees executive compensation, plans, grants, and disclosures; uses external benchmarks and company performance metrics; 2024 committee comprised entirely of independent directors (pre- and post-merger) .
Investment Implications
- Alignment: Multi-year RSU schedules and CEO stock ownership guidelines support alignment with long-term value creation; clawback adds downside-risk discipline .
- Retention and change-in-control economics: Strong severance/change-in-control protections (24 months base + 2x average bonus in CIC; equity acceleration for pre-merger awards in early termination) reduce near-term attrition risk but increase potential transaction-related costs; investors should factor these into M&A scenarios .
- Selling pressure: Near-term RSU vesting and the 2024 merger-related option payout indicate possible incremental liquidity events, but anti-hedging/pledging constraints and guidelines mitigate forced selling; monitor Form 4 filings around vesting dates for trading signals .
- Governance: CEO-director dual role is offset by independent Chair separation and a Lead Independent Director; fully independent ARC and CNG committees provide oversight, reducing independence concerns .