Jeffrey Shellberg
About Jeffrey Shellberg
Jeffrey Shellberg is a co-founder of Bridgewater Bancshares and has served as a director since 2005; he is 63 years old and currently serves as Secretary, Executive Vice President, and Chief Credit Officer (CCO) responsible for the Bank’s credit policies and chairing loan and credit risk management committees . He has 35+ years in regulatory and commercial banking, including 15 years at the FDIC and senior leadership at Klein Bank; he holds a B.S. from Iowa State University and is an alumnus of the Graduate School of Banking at Colorado, Boulder, and served on the board of PCs for People through 2024 . The Board has determined he is not independent due to his executive officer role .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Bridgewater Bancshares, Inc. | Co-founder; Director; Secretary; EVP & Chief Credit Officer | Director since 2005; CCO since 2013 | Chairs loan and credit risk management committees; integral in largest lending credit actions |
| FDIC | Various roles | 15 years (began in 1985) | Regulatory experience foundational to credit/risk expertise |
| Klein Bank | Senior Vice President | Not disclosed | Commercial banking leadership prior to joining Bridgewater |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| PCs for People (non-profit) | Board Member | Through 2024 | Community engagement; governance experience outside the company |
Board Governance
- Independence, roles, committees: Shellberg is not independent and serves as an executive officer (Secretary, EVP & CCO); he is not listed on Board standing committees (Audit, Compensation, Nominating & ESG) .
- Board and committee activity: The Board held 13 meetings in 2024; all directors attended at least 75% of Board and committee meetings; Audit Committee met 8 times, Compensation 3, Nominating & ESG 2 .
- Lead independent director: David Juran serves as Lead Independent Director .
- Director compensation program: Non-employee directors receive retainers paid half cash/half stock; executive directors (Baack and Shellberg) receive no director compensation .
- Related-party review: Audit Committee pre-approves auditor services and reviews related-party transactions per policy; a 2024 development services fee (~$125k) was paid to North Shore (owned by directors Urness and Juran), reviewed under policy standards; no linkage disclosed to Shellberg .
Fixed Compensation
Summary Compensation Table (Shellberg)
| Metric (USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary | $365,000 | $365,000 | $365,000 |
| Bonus | $251,880 | $0 | $0 |
| Stock Awards (RSUs) | $0 | $168,325 | $96,701 |
| Option Awards | $105,668 | $0 | $0 |
| Non-Equity Incentive Plan Compensation (STI) | $15,098 | $104,000 | $104,000 |
| All Other Compensation | $37,594 | $38,590 | $39,431 |
| Total | $775,240 | $675,915 | $605,132 |
- Perquisites and 401(k): 2024 perquisites $15,281 and 401(k) contributions $24,150; total “All Other Compensation” $39,431 .
- Employment agreement: Effective Jan 1, 2022, initial 3-year term with automatic annual renewals; non-compete within 25 miles and non-solicitation apply during employment and 12 months post-termination .
Performance Compensation
Short‑Term Incentive (STI) – 2024 Details
| Item | FY 2024 |
|---|---|
| Target Bonus (% of Base) | 60% |
| Target Bonus ($) | $219,000 |
| PPNR Component Payout | $78,327 |
| Individual Performance Payout | $25,673 |
| Total STI Paid | $104,000 |
| STI Paid (% of Base Salary) | 28% |
- STI metric/adjustments: Compensation Committee adjusted PPNR to add back one-time acquisition expenses and include a one-time securities gain; adjusted PPNR met threshold but not target; payouts ranged 14%–34% of target across NEOs, reflecting below‑historical performance .
- Pay versus performance framework: Key measures tying compensation to performance included EPS, ROAA, PPNR, ROATCE, net charge-offs, nonperforming assets, and tangible book value per share growth .
Long‑Term Incentives (Equity) – 2024 Grants
| Grant Type | Grant Date | Shares/Units | Grant Date Fair Value | Vesting |
|---|---|---|---|---|
| RSUs | Feb 2, 2024 | 8,133 | $96,701 | 25% per year over 4 years |
- Option awards cadence/terms: Options historically granted (e.g., Feb 1, 2022 strike $17.50) vest 25% annually over four years; RSUs vest ratably over four years; awards accelerate upon certain change‑in‑control or death/disability events per plan terms .
Change‑in‑Control and Severance
| Scenario | Cash Severance | Insurance Continuation | Equity Acceleration | Total (est., Dec 31, 2024) |
|---|---|---|---|---|
| Termination w/o Cause or Good Reason (No CIC) | $365,000 | $14,229 | $0 | $379,229 |
| Termination w/o Cause or Good Reason (With CIC) | $938,000 | $14,229 | Stock $251,272; Options $920,750 | $2,124,251 |
| Death/Disability | $0 | $0 | Stock $251,272; Options $920,750 | $1,172,022 |
| Retirement | $0 | $0 | Stock $251,272 | $251,272 |
- CIC terms in employment agreement: 200% of salary plus most recent cash incentive bonus, single lump sum; agreements extend for two years post‑CIC then terminate .
- Clawback and anti‑hedging: Formal clawback policy for bonus/stock; Insider Trading Policy prohibits hedging and sets trading windows .
Other Directorships & Interlocks
| Company | Role | Committee Positions | Notes |
|---|---|---|---|
| None disclosed | — | — | No public company directorships disclosed for Shellberg in the proxy . |
Expertise & Qualifications
- Strategic credit/risk leadership: Chairs internal loan and credit risk management committees; integral in largest lending decisions; experience spans strategic planning, risk management, ALM, and audit .
- Regulatory and banking depth: 15 years at the FDIC and senior roles in community banking provide strong regulatory and credit oversight credentials .
- Education: B.S. Iowa State University; Graduate School of Banking at Colorado, Boulder .
Equity Ownership
| Item | Value |
|---|---|
| Shares Beneficially Owned | 967,611 |
| Percent of Class | 3.48% (based on 27,596,315 shares) |
| Options Exercisable Within 60 Days | 190,000 |
| Unvested Options (not vesting within 60 days) | 5,000 |
| RSUs Not Vesting Within 60 Days | 21,392 |
| Pledged Shares (Collateral) | 200,000 |
| Trust Holdings | 357,390 (Jeffrey D. Shellberg Trust); 87,000 (Susan K. Shellberg Family Trust); 65,000 (Susan K. Shellberg Marital Trust) |
Outstanding Equity Awards (as of Dec 31, 2024)
| Grant Date | Type | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration | RSUs Not Vested (#) | Market Value ($) |
|---|---|---|---|---|---|---|---|
| Oct 1, 2017 | Options | 150,000 | — | 7.47 | Sep 30, 2027 | — | — |
| Dec 6, 2019 | Options | 25,000 | — | 12.92 | Dec 6, 2029 | — | — |
| Feb 1, 2022 | Options | 10,000 | 10,000 | 17.50 | Feb 1, 2032 | — | — |
| Dec 6, 2021 | RSUs | — | — | — | — | 2,368 | $31,992 |
| Feb 2, 2023 | RSUs | — | — | — | — | 8,098 | $109,404 |
| Feb 2, 2024 | RSUs | — | — | — | — | 8,133 | $109,877 |
Market value based on $13.51 closing price on Dec 31, 2024; RSUs vest 25% annually over four years; equity accelerates upon specified CIC or death/disability conditions .
Governance Assessment
- Independence and dual role: Shellberg is a non‑independent director due to his executive role (Secretary, EVP & CCO), which can constrain board independence; he is not seated on Audit, Compensation, or Nominating & ESG committees, mitigating direct influence over oversight functions .
- Attendance and engagement: Board met 13 times in 2024; all directors met at least 75% attendance, indicating active participation; Shellberg’s internal chair roles in credit risk suggest deep engagement with core banking risk processes .
- Pay‑for‑performance calibration: STI payouts were scaled back (14%–34% of target) given below‑historical performance; Shellberg’s STI was 28% of base salary, reflecting discipline in compensation outcomes tied to adjusted PPNR and individual performance .
- RED FLAGS: Shares pledged as collateral (200,000) present alignment risk if margin pressure forces sales; company prohibits hedging, partially mitigating risk, but pledging remains a governance concern for investors .
- Ownership alignment: Significant personal ownership (3.48%) and long tenure signal alignment; NEO stock ownership guidelines are not implemented (committee judged them unnecessary given historical retention), which some investors may view as a gap versus best practice .
- Change‑in‑control terms: 200% of salary+bonus CIC severance and equity acceleration are standard for regional banks; the structure includes non‑compete and non‑solicit and a formal clawback policy, supporting risk management and governance .
- Shareholder sentiment: Say‑on‑pay received 96.25% support at the 2024 meeting, indicating broad investor approval of compensation practices, including those affecting Shellberg .