Jonathan L. Lum
CREDIT ACCEPTANCEAbout Jonathan L. Lum
Jonathan L. Lum is Chief Operating Officer at Credit Acceptance Corporation (CACC), age 48 as of the 2025 proxy. He joined CACC in 2002, progressed through finance, compliance, internal audit, and operations, and has served as COO since May 2019 . The company does not disclose TSR, revenue growth, or EBITDA growth tied specifically to his tenure; however, the 2025–2034 executive RSU program was sized to target incentive compensation only if CACC’s share price compounds at 11% annually, aligning equity value realization with long-term stock performance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Credit Acceptance | Finance roles incl. Accounting Manager | 2002–2007 | Built financial and accounting foundation; internal controls exposure |
| Credit Acceptance | Director – Projects & Support | 2007 | Led cross-functional projects; operational support governance |
| Credit Acceptance | Director – Policy Compliance | 2008 | Established policy compliance frameworks |
| Credit Acceptance | VP – Internal Audit & Compliance | 2009 | Strengthened audit/compliance oversight |
| Credit Acceptance | SVP – Dealer Service Center | 2011 | Scaled dealer operations and service execution |
| Credit Acceptance | Chief Operating Officer | May 2019–present | Enterprise operations leadership; long-term incentive alignment shift |
External Roles
No external directorships or outside public-company roles disclosed for Mr. Lum in the latest proxy .
Fixed Compensation
| Metric | FY 2024 | FY 2025 | Notes |
|---|---|---|---|
| Base Salary ($) | $560,000 | $650,000 (16.1% increase) | 2025 increase under new 10-year plan |
| All Other Compensation ($) | $18,241 | N/A | Includes $17,250 401(k) match, $941 profit sharing, $50 tax reimbursements |
Performance Compensation
RSU Program (2025–2034)
| Grant Date | RSUs Granted (#) | Grant Date Fair Value ($) | Vesting | Settlement | Performance Link |
|---|---|---|---|---|---|
| 12/3/2024 | 23,884 | $11,509,938 | 10 annual tranches Jan 31, 2026–2035, time-based | Base RSUs: 50% at vest, 50% one year later; Retirement RSUs: 100% 5 years post-termination (2 years if age ≥60) | Grant sizing calibrated to 11% share price CAGR to meet target incentive levels |
Performance Compensation Metrics—Structure
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Share price CAGR (2025–2034) | — | 11% CAGR used to size RSU awards | N/A (program just initiated) | Grant sizes reflect target-at-11% CAGR | Time-based vesting over 10 years; settlement split Base/Retirement RSUs |
Stock Options Program (2021–2024)
| Grant Date | Options (#) | Exercise Price ($) | Vesting | Expiration |
|---|---|---|---|---|
| 12/30/2020 | 40,000 | $333.94 | Four equal annual installments beginning first anniversary, contingent on continuous employment | Six years from grant (12/30/2026) |
Equity Ownership & Alignment
| Ownership Item | Amount | Detail |
|---|---|---|
| Beneficial Ownership (shares) | 45,109; <1% of outstanding | Based on 11,747,851 shares outstanding as of 4/8/2025; includes shares exercisable within 60 days |
| Unvested RSUs | 23,884 | Market value $11,212,583 at $469.46/share on 12/31/2024 |
| Options (exercisable) | 37,500 | $333.94 strike; expire 12/30/2026 |
| RSU Vesting Commencement | Jan 31, 2026 | Annual vesting on each of the nine subsequent anniversaries |
| Settlement Design | 75% Base RSUs; 25% Retirement RSUs | Base RSUs: 50% at vest, 50% at 1-year; Retirement RSUs: 5 years post-termination (2 years if ≥60) |
| Hedging Policy | Hedging prohibited for executives/directors | Clawback policy compliant with SEC/Nasdaq |
| Pledging | Not disclosed | No specific pledging policy disclosure found in proxy |
| Nonqualified Deferred Compensation (delayed settlement RSUs) | $7,007,864 | Registrant contributions attributable to RSUs with delayed settlement, valued at $469.46/share as of 12/31/2024 |
Employment Terms
| Provision | Terms |
|---|---|
| Severance | No individual agreements providing cash severance or benefits continuation on termination, including pre/post change-in-control |
| Termination (pre-vest) | Unvested options and RSUs are forfeited; Compensation Committee may waive/change restrictions |
| Change-in-Control Vesting | Double-trigger: if awards are assumed/substituted, vest on termination without cause or resignation for good reason within 24 months |
| RSU Accelerator (CIC, assumed/substituted) | Vests next three scheduled vesting dates’ RSUs or remaining unvested amount, whichever is less |
| Unassumed Awards at CIC | Fully vest and become exercisable immediately; Committee may cancel options for spread value |
| Potential CIC Acceleration (12/31/2024) | RSUs: $11,212,583; Unvested options: $0 reported for Lum |
Compensation Structure Analysis
- Transition from 2021–2024 options to a 2025–2034 time-based RSU program increases certainty of value vs. options, but incorporates long vesting and delayed settlement to sustain alignment and retention .
- 2025 base salary increased 16.1% to $650,000 under the new plan, with equity grants front-loaded for the decade, indicating emphasis on long-term ownership culture over annual cash incentives .
- RSU sizing anchored to shareholder value creation (11% share price CAGR), directly linking intended incentive outcomes to long-term TSR without annual bonus metrics; CEO award includes performance-based vesting in later years, but Lum’s RSUs are time-based .
- Clawback policy aligned with SEC/Nasdaq; hedging transactions prohibited, reducing misalignment risk; no disclosure of pledging policy .
Say-on-Pay & Shareholder Feedback
| Proposal | For | Against | Abstain | Broker Non-Votes |
|---|---|---|---|---|
| Advisory vote on NEO compensation (6/4/2025) | 5,864,978 | 139,529 | 2,393 | 2,695,109 |
Compensation Committee Analysis
- Compensation Committee sets CEO pay directly and other NEO pay after CEO recommendations; does not use compensation consultants or peer group comparisons in setting executive compensation .
- Long-term equity incentives are central; plan features include no repricing, no evergreen, minimum vesting periods, double-trigger CIC, no discounted options, and disciplined dividend policy per Incentive Plan governance (see 2024 proxy governance disclosures) .
Investment Implications
- Alignment: Lum’s decade-long RSU program with delayed settlement and explicit share-price CAGR calibration ties realizable compensation to long-term TSR, while the Base/Retirement RSU design likely reduces near-term selling pressure but creates steady annual settlement beginning 2026 (50% at vest; 50% at 1-year) . Strong pay alignment is suggested by robust say-on-pay support in 2025 .
- Retention: Absence of cash severance and forfeiture of unvested equity on termination, coupled with 10-year vesting and post-termination settlement, creates high retention hooks; CIC terms are standard double-trigger with partial RSU acceleration (next three vest dates), moderating windfalls .
- Selling pressure: No RSUs vested in 2024 for NEOs, and Base RSU settlements will begin in 2026, implying potential incremental supply around annual vesting dates; monitoring Form 4 activity will be key as vesting commences .
- Risk flags: Hedging prohibited and clawback in place; no disclosed pledging policy; large upfront RSU grant value ($11.51M grant-date fair value) raises pay quantum scrutiny but is balanced by long vesting and explicit long-term value creation framework .