Ronald Simon
About Ronald I. Simon, Ph.D.
Ronald I. Simon is 86, an independent director and Chairman of the Board at Ellington Financial Inc. (EFC) since January 2021, having served on the Board since August 2007; he is also Chairman of the Audit Committee . He is a private investor and financial consultant, with prior public-company roles spanning finance, health insurance, technology, and specialty finance; he holds a B.A. (Harvard), M.A. (Columbia), and Ph.D. (Columbia Graduate School of Business) . The Board has determined Dr. Simon is independent under NYSE and EFC Corporate Governance Guidelines .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| WFS Financial, Inc. | Director | Mar 2003–Feb 2006 | Publicly-traded auto finance; acquired by Wachovia |
| SoftNet Systems, Inc. | Director; Acting Chairman, CEO & CFO | 1995–2002; Acting roles in 2001 | Technology; led during restructuring period |
| American Independence Corp. (AIC) | Director | 2002–Aug 2016 | Health insurance/reinsurance; successor to SoftNet |
| Independence Holdings Company (IHC) | Director; Audit Committee member | Aug 2016–Feb 2022; Audit member Nov 2017–Feb 2022 | Life/health insurance; AIC successor |
| Collateral Therapeutics | Director | 1998–2002 | Biotech; acquired by Schering A.G. |
| Cardium Therapeutics | Director | Jan 2006–Jan 2009 | Biotech; gene therapy continuation post-Schering |
| BDI Investment Corporation | Director | Feb 2003–early 2005 | Regulated investment company; liquidated |
| Wingcast, LLC | CFO | 2001–2002 | Automotive telematics startup |
| Western Water Company | EVP & CFO; Director | 1997–2000; Director 1999–2001 | Water utility; finance leadership |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Ellington Credit Company (NYSE: EARN) | Trustee; Chair, Nominating & Corporate Governance Committee | Since May 2013 | Board oversight; governance leadership |
Board Governance
- Independence: Board determined Dr. Simon (and three other nominees) are independent under NYSE guidelines and EFC corporate governance .
- Committee assignments (2024): Chairman, Audit Committee; Member, Compensation Committee; Member, Nominating & Corporate Governance Committee .
- Committee meeting count (2024): Audit 10; Compensation 9; Nominating & Corporate Governance 5 .
- Executive sessions: Independent directors met in executive session four times without management in 2024 .
- Attendance: In 2024, there were 13 Board meetings; each current director attended at least 75% of Board and committee meetings on which they served . In 2023, the Board held 30 meetings; each current director attended at least 95% .
- Annual meeting attendance: Dr. Simon attended the 2024 Annual Meeting of Stockholders .
Fixed Compensation
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Annual cash retainer (independent directors) | $80,000 | $95,000 | $105,000 |
| Board Chair additional retainer | $25,000 | $25,000 | $25,000 |
| Audit Committee Chair retainer | $20,000 | $20,000 | $20,000 |
| Compensation Committee Chair retainer | $8,000 | $8,000 | $8,000 |
| Nominating & Corp Gov Chair retainer | $8,000 | $8,000 | $8,000 |
| Longbridge board service retainer | N/A | $20,000 | $20,000 |
Director compensation (2024 actuals):
| Name | Fees Earned or Paid in Cash | Equity Compensation Awards | All Other Compensation (Dividends) | Total |
|---|---|---|---|---|
| Ronald I. Simon, Ph.D. | $170,000 | $110,003 | $12,133 | $292,136 |
| Edward Resendez | $133,000 | $110,003 | $12,133 | $255,136 |
| Lisa Mumford | $105,000 | $110,003 | $12,133 | $227,136 |
| Stephen J. Dannhauser | $113,000 | $110,003 | $12,133 | $235,136 |
Notes:
- Dr. Simon’s $170,000 cash reflects base ($105,000), Board Chair ($25,000), Audit Chair ($20,000), and Longbridge board retainer ($20,000) .
- EFC reimburses travel expenses for Board/committee meetings and the Annual Meeting .
Performance Compensation
Director equity awards and vesting:
| Item | 2022 | 2023 | 2024 |
|---|---|---|---|
| Equity grant value per independent director | ~$90,000 OP LTIP Units (6,199 units granted Sept 13, 2022; vest Sept 12, 2023) | ~$100,000 OP LTIP Units (7,657 units granted Dec 14, 2023; vest Sept 13, 2024) | ~$110,000 OP LTIP Units (8,378 units granted Sept 11, 2024; for Simon, exchanged to 8,378 Restricted Shares on Dec 27, 2024; Simon’s Restricted Shares vest Dec 26, 2025) |
| Dividend treatment on unvested awards | Dividends paid on unvested OP LTIP Units | Dividends paid on unvested OP LTIP Units | Dividends paid on unvested OP LTIP Units/Restricted Shares |
Performance metrics tied to director compensation:
| Metric | Used for Director Equity/Comp? | Evidence |
|---|---|---|
| Revenue growth | No | Director program is time-based vesting over one year; no performance metrics disclosed |
| EBITDA or Net Income targets | No | No metrics tied to director pay disclosed |
| TSR percentile | No | No TSR linkage disclosed |
| ESG goals | No | Not disclosed for director pay |
Other Directorships & Interlocks
- Current affiliate board: Trustee of Ellington Credit Company (EARN); Chair of Nominating & Corporate Governance Committee .
- Prior public boards: WFS Financial (2003–2006); SoftNet Systems (1995–2002; Acting Chairman/CEO/CFO in 2001); American Independence Corp. (2002–2016); Independence Holdings Company (2016–2022; Audit Committee) .
- Additional historical roles: Collateral Therapeutics (1998–2002); Cardium Therapeutics (2006–2009); BDI Investment Corp. (2003–2005); Western Water Company (EVP & CFO, 1997–2000; Director, 1999–2001); Wingcast LLC (CFO, 2001–2002) .
Potential interlocks/conflicts:
- EFC is externally managed by an affiliate (EFM/EMG); the Nominating & Corporate Governance Committee reviews related-party transactions and has oversight over cross/principal transactions and fee rebates per management agreement .
Expertise & Qualifications
- Audit committee financial expert: The Board determined Dr. Simon (Audit Chair) and Lisa Mumford are “audit committee financial experts” under SEC rules; all Audit Committee members are financially literate and independent .
- Education: B.A. Harvard; M.A. Columbia; Ph.D. Columbia Graduate School of Business .
- Domain experience: Finance leadership across public companies; governance leadership at EARN; extensive senior roles in finance and operations .
Equity Ownership
| Holder | Common Shares Beneficially Owned | % of Common Shares Outstanding | Notes |
|---|---|---|---|
| Ronald I. Simon, Ph.D. | 65,258 | <1% (*) | Beneficially held via trust for Dr. Simon and spouse |
Unvested/vested detail for 2024 awards:
- 8,378 Restricted Shares received Dec 27, 2024; vest in full on Dec 26, 2025, subject to continued Board service .
Policies impacting alignment:
- No short sales or derivative hedging permitted by directors or officers; EFC/EMG emphasize governance and alignment; officers/directors/affiliates owned ~4% of common equity as of Dec 31, 2024 .
Insider filings:
- One late Form 4 reported for Dr. Simon (Dec 18, 2023) relating to conversion of OP LTIP Units into OP Units received as compensation .
Governance Assessment
- Board effectiveness: Independent Chair with deep finance expertise; Simon chairs Audit Committee and serves on Compensation and Nominating & Governance, supporting oversight across financial reporting, pay, and governance . Independent directors meet quarterly in executive session, reinforcing independent oversight .
- Attendance & engagement: 2024 attendance threshold met (≥75% attendance) with higher engagement in 2023 (≥95%); Simon attended the 2024 Annual Meeting .
- Pay structure & alignment: Balanced cash/equity mix; cash retainer increased to reflect responsibilities and market (from $95k in 2023 to $105k in 2024), with equity grants vesting on time-based schedules; dividends on unvested awards are paid, which some investors view as a softening of performance linkage .
- Related-party exposure: External management and affiliate transactions (cross/principal) present inherent conflicts; mitigants include independent director pre-approvals, audit committee oversight, pricing policies, and fee rebates when investing in EMG-affiliated vehicles .
- Say‑on‑pay signals: 2023 say‑on‑pay approval ~87% of votes cast ; 2024 approval 36,317,488 For vs 4,979,356 Against (725,795 Abstentions) —management views indicate shareholders support pay practices for reimbursed executives (not directly related to director pay).
RED FLAGS
- External management and cross/principal transactions require continued robust independent oversight and adherence to pricing/approval policies .
- Dividends on unvested director equity awards can weaken strict pay-for-performance alignment for directors (time-based vesting only) .
- Late Section 16 filing in 2023 (administrative) for Dr. Simon .
Compensation Committee Analysis
- Members (2024): Resendez (Chair), Dannhauser, Mumford, Simon—all independent .
- Interlocks: Other than Ms. Mumford’s prior CFO role, no relationships requiring Item 404 disclosure; no reciprocal board/comp committee interlocks with EFC executives .
- Consultants: The Compensation Committee did not use a compensation consultant for executive or director compensation determinations .
- Clawback: Company clawback policy effective Nov 2, 2023 for incentive compensation in event of restatement (executives), demonstrating governance rigor .
Say‑On‑Pay & Shareholder Feedback
| Year | For | Against | Abstain | Source |
|---|---|---|---|---|
| 2023 (approval rate ~87% of votes cast) | 34,659,715 | 4,394,470 | 745,751 | 8‑K Item 5.07 |
| 2024 | 36,317,488 | 4,979,356 | 725,795 | 8‑K Item 5.07 |
Director Compensation – Mix and Trends
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Cash retainer (independent directors) | $80,000 | $95,000 | $105,000 |
| Equity grant (per director) | ~$90,000 OP LTIP Units | ~$100,000 OP LTIP Units | ~$110,000 OP LTIP Units (Restricted Shares for Simon/Mumford) |
| Simon total director comp (fees + equity + dividends) | $223,288 | $268,369 | $292,136 |
Shift analysis:
- Increased cash and equity retainer values year over year; awards remain time-based with dividends on unvested awards .
Related‑Party Transactions (Framework)
- Cross transactions allowed at prevailing market prices unless independently pre-approved; special methodologies permitted for assets without observable prices .
- Principal transactions require prior approval by a majority of independent directors and compliance with law, including pricing methodology approval .
- Fee rebates reduce EFC management/incentive fees when investing in EMG-managed/structured vehicles at issuance .
- Split-price executions permitted with fair and consistent allocation among accounts .
Employment & Contracts (Directors)
- No director employment agreements disclosed; indemnification agreements in place for directors (maximum extent under Delaware law; advancement of defense expenses) .
Performance & Track Record
- Not specifically disclosed for director-specific stock performance; EFC provides pay-versus-performance disclosures for executives, not directors .
Committee Attendance & Meetings (2024)
| Committee | Chair | Meetings | Simon’s Role |
|---|---|---|---|
| Audit | Ronald I. Simon, Ph.D. | 10 | Chair |
| Compensation | Edward Resendez | 9 | Member |
| Nominating & Corp Governance | Stephen J. Dannhauser | 5 | Member |
Summary Governance View
- Strong audit leadership and independence underpin investor confidence; Simon’s financial expertise (Audit Chair; SEC “financial expert” designation) supports robust oversight of financial reporting and risk .
- External management and affiliate dealings represent structural conflicts; however, pre-approval controls, committee oversight, and fee-rebate mechanisms mitigate risks when adhered to .
- Director compensation is market-aligned with clear role-based cash adders and annual equity; absence of performance-conditioned equity and dividends on unvested awards modestly weakens pay-for-performance optics for directors .
- Shareholder advisory votes (say‑on‑pay) show continuing support for compensation programs (high approval levels in 2023/2024), reinforcing management’s alignment narrative .