Charles E. Bradley, Jr.
CONSUMER PORTFOLIO SERVICESAbout Charles E. Bradley, Jr.
Charles E. Bradley, Jr. is 65 and has served as CPSS’s Chief Executive Officer since January 1992; he has been a director since the company’s formation in March 1991 and Chairman of the Board since July 2001 . In 2024, diluted EPS was $0.79 and net income was $19.203 million, while the value of a hypothetical $100 CPSS investment stood at $322.26 (pay-versus-performance disclosure), framing recent shareholder value creation and earnings power . The Compensation Committee identifies Diluted EPS, Revenue, and Net Interest Margin as key financial performance measures linking compensation to outcomes . Mr. Bradley received no additional fees for board service beyond his CEO compensation .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Consumer Portfolio Services, Inc. | President | Mar 1991 – Dec 2022 | Foundational executive leadership since inception; deep knowledge of business, structure, history, and culture . |
| Barnard and Company (private investment firm) | Chief Operating Officer | Apr 1989 – Nov 1990 | Operating leadership experience prior to CPSS . |
| The Harding Group (private investment banking firm) | Associate | Sep 1987 – Mar 1989 | Investment banking experience; finance and deal exposure . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Not disclosed | — | — | No external directorships or roles disclosed for Mr. Bradley in the proxy . |
Fixed Compensation
| Year | Base Salary ($) | Notes |
|---|---|---|
| 2022 | 995,000 | Base rate referenced; CEO pay structure reviewed annually by Compensation Committee . |
| 2023 | 995,000 | No increase in CEO base for 2024; others saw increases . |
| 2024 | 995,000 | Committee considered retention and market levels; kept CEO base flat . |
| Year | All Other Compensation ($) | Components (examples) |
|---|---|---|
| 2022 | 351 | Group life insurance and 401(k) match . |
| 2023 | 342 | Group life insurance and 401(k) match . |
| 2024 | 40,611 | Group life insurance ($342), 401(k) match ($2,000), vacation cash-out ($38,269) . |
Performance Compensation
| Year | Non‑Equity Incentive (Bonus) ($) | Option Awards ($) | Total ($) |
|---|---|---|---|
| 2022 | 3,980,000 | 5,885,850 | 10,861,201 |
| 2023 | 3,005,000 | – | 4,000,342 |
| 2024 | 3,130,000 | – | 4,165,611 |
| 2024 Plan-Based Bonus Opportunity | Threshold ($) | Target ($) | Maximum ($) |
|---|---|---|---|
| Executive Management Bonus Plan (CEO) | – | 6,467,500 | 6,467,500 |
| 2024 CEO Performance Metrics | Weighting (max % of base) | Result (Credit) | Notes |
|---|---|---|---|
| Meet/exceed quarterly budget (Q1–Q4) | 25% each quarter (100% total) | Met all four; 100% credit | Operational execution. |
| Execute four rated securitizations | 25% each (100% total) | Achieved all four; 100% credit | Funding strategy success. |
| Increase annual originations to targets ($1.3–$1.6B) | Up to 100% aggregate | Exceeded $1.6B; 100% credit | Growth without compromising credit quality. |
| Decrease core operating expenses up to 1% | Up to 100% | Achieved 0.1%; 10% credit | Cost discipline. |
| Raise $50M new residual financing deal | 50% | Achieved; 50% credit | Balance sheet optimization. |
| Obtain up to $600M forward flow | 100% | Not obtained; 0% credit | Missed objective. |
| Stock price targets ($10/$11/$12/$13) | 100% aggregate (25% increments) | One target met; 25% credit | Market-based metric. |
- Aggregate credit: 385% implying a formula bonus of $3,830,750; Committee exercised discretion to pay $3,130,000, equal to 314.57% of base salary .
- Performance measures used to link compensation: Diluted EPS, Revenue, Net Interest Margin .
Equity Ownership & Alignment
| Beneficial Ownership | Shares | % of Class |
|---|---|---|
| Total beneficial ownership (Record Date Oct 23, 2025; 22,071,046 shares outstanding) | 5,744,435 | 24.2% |
| Option Holdings (as of Dec 31, 2024) | Exercisable | Unexercisable | Exercise Price ($) | Expiration |
|---|---|---|---|---|
| Grant | 300,000 | – | 3.48 | 5/9/2025 |
| Grant | 300,000 | – | 3.53 | 8/8/2026 |
| Grant | 240,000 | – | 2.47 | 6/1/2027 |
| Grant | 225,000 | 75,000 | 4.95 | 8/3/2028 |
| Grant (Jan 24, 2022) | 375,000 | 375,000 | 10.32 | 1/24/2029 |
| Grant (Jun 24, 2022) | 150,000 | 150,000 | 10.25 | 6/24/2029 |
| Vesting Schedule Highlights | Detail |
|---|---|
| 225k/75k grant | Unexercisable becomes exercisable on Aug 3, 2025 . |
| 375k/375k grant | Unexercisable vests 50% on Jan 24, 2025 and 50% on Jan 24, 2026 . |
| 150k/150k grant | Unexercisable vests 50% on Jun 24, 2025 and 50% on Jun 24, 2026 . |
| Near-Term Exercise Rights | Shares acquirable within 60 days of Record Date | Note |
|---|---|---|
| CEO options within 60 days | 1,627,500 | Standard beneficial ownership calculation convention . |
| 2024 Option Exercises | Shares Acquired on Exercise | Value Realized ($) |
|---|---|---|
| Mr. Bradley | 300,000 | 1,275,000 |
| Pledging & Hedging | Policy/Status |
|---|---|
| Shares pledged | 1,685,878 shares pledged to secure loan(s) to him . |
| Hedging policy | Prohibits short sales and hedging (e.g., puts); pledging is permitted and not prohibited for executives . |
| Ownership guidelines | No minimum stock ownership policy for senior management; multi‑year vesting aligns incentives . |
Employment Terms
- Employment status: At‑will; no employment contract and no severance cash benefits upon termination outside of change of control .
- Post-termination option treatment: Unvested options terminate; vested options expire three months after separation (12 months for disability, retirement, or death) .
- Change‑of‑Control treatment: Option acceleration is mandated in specific events (sale of substantially all assets; board majority change within 3 years; acquisition >25%) and conditionally in mergers where CPSS shareholders own <50% unless equivalent awards are provided or there is a Qualifying Termination within one year (double trigger) .
- Qualifying Termination definition: Termination by CPSS other than for cause, disability, or death, or resignation for good reason (material diminution or relocation >50 miles) .
- Potential benefit upon acceleration (Dec 31, 2024 closing price $10.86): $737,250 for Mr. Bradley .
- Clawback: Awards subject to recoupment/clawback and equity holding policies adopted by CPSS and those required by law, regulation, and listing standards (including Dodd‑Frank Rule 10D‑1 framework) .
Board Governance (Director Service, Committees, Independence)
- Board service: Director since March 1991; Chairman since July 2001; CEO since Jan 1992; no separate director fees for Mr. Bradley .
- Combined roles: Board endorses combined Chairman/CEO structure; no Lead Independent Director designated; all other directors deemed independent under Nasdaq .
- Committee memberships: Mr. Bradley is not on key committees; Audit, Compensation, and Nominating committees consist solely of independent directors .
- Audit Committee: Brian J. Rayhill (chair), Louis M. Grasso, Gregory S. Washer, Daniel S. Wood; Wood designated audit committee financial expert .
- Compensation Committee: Daniel S. Wood (chair), William W. Grounds, William B. Roberts; met once in 2024; all independent .
- Nominating Committee: Gregory S. Washer (chair), William W. Grounds, Brian J. Rayhill; all independent .
- Meetings/attendance: Board met four times in 2024; Audit met five; Nominating once; Mr. Roberts attended <75% of eligible meetings; CEO attended annual meeting; no attendance data specific to Mr. Bradley’s committee participation (he is not on committees) .
- Director compensation (cash): Non‑employee directors received monthly retainers and per diem fees; Mr. Bradley received none for board service .
Compensation Committee Analysis and Shareholder Feedback
- Committee independence and remit: Compensation Committee, composed solely of independent directors, sets CEO goals, evaluates performance, and administers bonus and equity plans .
- Consultants: Authorized to retain experts; to date, has not done so .
- Pay philosophy: Emphasis on retention, significant contingent compensation tied to company objectives, and equity-linked incentives; base salaries adjusted considering retention and market factors .
- Performance factors considered: Earnings, revenue, originations, budget attainment; portfolio credit quality (delinquencies/charge‑offs); employee stability; difficulty of achieving outcomes; company success over the year .
- Say‑on‑Pay result (2024): 92% approval; committee retained program design and structure .
- Say‑on‑Pay frequency: Board supports annual advisory votes; shareholders to vote on future frequency; currently held annually .
- Risk oversight: Compensation Committee manages risk by qualifying growth objectives with credit quality mandates, complementing Audit Committee oversight of allowances/reserves .
Compensation Structure Signals
- Mix shift: 2024 and 2023 included no new option grants; 2022 included a substantial option award to Mr. Bradley (750,000 options granted Jan 24, 2022 with weighted average fair value $5.8558; valuation assumptions: 4.11‑year expected life, 75%+ volatility, risk‑free 1.43%; additional officer options were granted June 24, 2022) .
- Discretionary bonus adjustment: Committee reduced CEO bonus from formula‑implied $3.83M (385% of base) to $3.13M (314.57% of base) .
- No ownership guidelines; pledging permitted: Potential alignment risk due to large pledged share position .
Related Party Transactions and Red Flags
- Company repurchases from insiders: CPSS repurchased 50,000 shares from Mr. Bradley at $8.98 on June 14, 2024 ($449,000) and 70,000 shares at $9.85 on September 10, 2024 ($689,500); Audit Committee ratified the transactions post‑hoc .
- Family employment: Noel Jackson, Senior VP of Servicing, is Mr. Bradley’s sister; authorized by the Board with compensation reviewed annually by the Compensation Committee; 2024 base salary $181,000 and bonus eligibility under the Executive Management Bonus Plan .
- Pledging: 1,685,878 shares pledged as loan collateral (explicitly allowed by company policy) .
Director Compensation (For Bradley)
| Item | Amount |
|---|---|
| Board retainer/fees (CEO/Chairman) | $0; no additional board compensation beyond CEO pay . |
Equity Award Valuation Footnotes (Select 2022 Grants)
- 750,000 options granted to Mr. Bradley on Jan 24, 2022: weighted average fair value per option $5.8558 (Black‑Scholes assumptions: 4.11 years expected life, 75.26% volatility, 1.43% risk‑free rate) .
- June 24, 2022 options to other NEOs: weighted average fair value $4.98 (4.11 years expected life, 75.15% volatility, 3.13% risk‑free rate) .
Employment & Contracts (Specific Terms)
| Term | Detail |
|---|---|
| Employment contract | None; at‑will . |
| Severance | None (outside CoC); unvested options forfeit; vested options accelerated expiration post‑termination . |
| Change‑of‑control | Mandatory and discretionary acceleration regimes; double‑trigger applies in merger scenarios with <50% surviving ownership unless equivalent awards provided . |
| Clawback | Awards subject to recoupment/clawback and equity holding policies; compliance with applicable law/Rule 10D‑1 . |
| Deferred compensation | No special deferred compensation programs; executives participate in standard 401(k) . |
Investment Implications
- Alignment: Very high ownership (24.2% of shares) aligns incentives but is partly offset by 1.69 million shares pledged, introducing financing and forced‑sale risk if collateral covenants tighten—monitor any changes in pledging or lender terms .
- Near‑term supply overhang: Significant option vesting tranches in 2025 and 2026 (Jan 24 and Jun 24 schedules) plus a history of exercising (300,000 shares; $1.275M realized in 2024) may create periodic insider selling pressure; track Form 4 filings and blackout windows around vesting dates .
- Pay‑for‑performance: Bonus structure is tightly linked to operational funding (securitizations), originations, budgeting discipline, and market price targets; committee’s discretionary reduction from formula payout indicates oversight discipline, a positive governance signal .
- Governance trade‑offs: Combined Chairman/CEO with no Lead Independent Director may constrain independent oversight, but independent committees and annual say‑on‑pay (92% approval in 2024) partially mitigate this concern; still, single‑point leadership requires monitoring, particularly in credit-cycle turns .
- Change‑of‑control economics: No cash severance; equity acceleration is primary benefit; the presence of double‑trigger features reduces immediate windfall risks in certain transactions; monitor any future equity plan amendments and the 2025 Equity Incentive Plan adoption .
- Trading signals: Company repurchases directly from the CEO in 2024 suggest board openness to insider liquidity under buyback authorization; cross‑reference buyback activity with valuation and upcoming option maturities/vesting to anticipate flows .