Rick Stanford
About Rick Stanford
Rick Stanford (age 63) is President of i3 Verticals (i3 Verticals, Inc.) and has served as President since January 2018; he previously served as EVP from 2013–2017. He holds a B.S. from the University of Memphis and has led acquisitions and corporate development since joining i3 Verticals in 2013 . Company performance in FY2024 showed revenue from continuing operations of $229.9M (+1.4% YoY), Adjusted EBITDA from continuing ops of $58.3M (down from $59.4M), and ARR growth of 7.5%, alongside the strategic sale of the Merchant Services business and full paydown of the 2023 senior credit facility . Compensation design ties pay to Adjusted EBITDA, adjusted EPS, ARR, and stock performance, with a 97% Say‑on‑Pay approval in 2024, indicating shareholder support for incentives alignment .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| i3 Verticals, LLC | President | 2017–present | Responsible for acquisitions and corporate development |
| i3 Verticals, LLC | EVP | 2013–2017 | Led M&A and growth initiatives |
| Direct Connect | Chief Marketing Officer | 2011–2012 | Executive leadership at a payments provider |
| Sage Payment Solutions | SVP, Sales | 2009–2011 | Commercial leadership post-Verus acquisition |
| Verus Financial Management | Vice President | 2006–2009 | Executive role at payments firm (later acquired by Sage) |
| Network 1 Financial, Inc. | EVP | 1999–2006 | Executive role prior to acquisition by Verus |
| PMT Services, Inc. (Nasdaq: PMTS) | Vice President | 1989–1999 | Senior role at credit card processor |
External Roles
- None disclosed in the proxy statements .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary (Paid) ($) | 300,000 | 311,250 | 322,088 |
| Base Salary (Effective Jan 1) ($) | 300,000 | 315,000 | 324,450 |
| Target Bonus % of Base | 25% (set Nov 2022) | 25% (set Nov 2022) | 10% (set Nov 2023) |
| Actual Cash Bonus ($) | 30,000 | 15,750 | 0 |
| All Other Compensation ($) | 8,739 | 17,120 | 18,741 |
Notes:
- 2023 bonuses were cut to 5% of base due to missing relative stock price goals despite meeting Adjusted EBITDA, margin, and ARR guidelines .
- 2024 bonuses were not awarded after missing Adjusted EBITDA growth, margin, ARR, and stock price performance goals .
Performance Compensation
Annual Incentive (Cash)
| Fiscal Year | Metric | Weighting | Target | Actual | Payout | Notes |
|---|---|---|---|---|---|---|
| 2023 | Adjusted EBITDA; EBITDA Margin; ARR; Relative Stock Price vs peers | Discretionary (no fixed weights) | Committee guidelines (not formulaic) | Met EBITDA/margin/ARR; missed stock price | 5% of base ($15,750) | Emphasis on stock underperformance drove payout reduction |
| 2024 | Adjusted EBITDA; EBITDA Margin; ARR; Stock Price (absolute + relative) | Discretionary (no fixed weights) | Committee guidelines (not formulaic) | Below guidelines across metrics | $0 | No cash bonus awarded |
Equity Incentives (Options, PSUs)
- Options: Time-based; 4 equal annual installments.
- PSUs: Five annual 5,000-share tranches; vest on pro forma adjusted diluted EPS targets; unearned tranches may vest later within the 5-year window .
| Award Type | Grant Date | Shares/Units | Exercise Price | Vesting | FY Target | FY Actual | Payout |
|---|---|---|---|---|---|---|---|
| Stock Options | 2/13/2023 | 103,000 | $26.31 | 25% annually starting 2/13/2024 | N/A | N/A | N/A |
| Stock Options | 2/13/2024 | 100,000 | $19.22 | 25% annually starting 2/13/2025 | N/A | N/A | N/A |
| PSUs (granted FY2022) | 2022 | 25,000 total (5,000/yr) | — | Annual EPS targets (5 years) | FY2023: $1.63 | $1.52 | 0 (remains eligible) |
| PSUs (adjusted FY2024 target) | 2022 | 25,000 total (5,000/yr) | — | Annual EPS targets (5 years) | FY2024: $1.08 (adjusted post-divestiture) | $0.46 | 0 (remains eligible) |
Upcoming Vesting Schedule (Potential Supply Overhang)
| Award | Tranche Size | Vest Dates |
|---|---|---|
| 2023 Options (103,000) | ~25,750 shares per year | 2/13/2024, 2/13/2025, 2/13/2026, 2/13/2027 |
| 2024 Options (100,000) | 25,000 shares per year | 2/13/2025, 2/13/2026, 2/13/2027, 2/13/2028 |
No option exercises were reported in FY2024, limiting near-term selling indications .
Equity Ownership & Alignment
| Ownership Detail (as of 12/27/2024 record date) | Amount | Notes |
|---|---|---|
| Class A Shares Beneficially Owned | 428,500 | 1.8% of Class A |
| Class B Shares Beneficially Owned | 100,000 | <1% of Class B |
| Combined Voting Power | 1.3% | Based on both classes |
| Options – Exercisable | 266,083 | Grants from 2018–2023; strikes $13.00–$34.20 |
| Options – Unexercisable | 188,917 | Includes 2023 and 2024 grants |
| PSUs – Unearned (Eligible) | 25,000 | 5,000 per FY over 5 years |
| Hedging Policy | Prohibits short sales and hedging/monetization for directors and Section 16 officers | |
| Pledging | No pledging policy disclosure; no pledging reported |
Anti-hedging and compensation recoupment policies are in place (mandatory clawback for restatements) .
Employment Terms
| Provision | Terms |
|---|---|
| Employment Agreement | None disclosed for Stanford; no cash severance arrangement |
| Change-of-Control (COC) | Equity acceleration; options vest/cash-out minus strike; PSUs vest if not assumed or termination within 12 months of COC |
| Non-Compete/Non-Solicit | Not disclosed |
| Severance Multiples | None (no salary/bonus severance) |
| Potential Payouts (as of 9/30/2024) | Change in Control: Options $209,000; PSUs $532,750; Total $741,750 |
| Death/Disability | Options $209,000; no PSUs acceleration disclosed for death/disability |
| Clawback | Mandatory recovery of erroneously awarded incentive comp after restatements |
| Insider Trading | Anti-hedging/short sale restrictions; discourages standing/limit orders |
Compensation Structure Analysis
- Shift toward time-based stock options with 4-year vesting starting in 2023 (vs. prior 3-year), increasing retention and long-term alignment; larger option grants in 2023 for retention and below-market cash levels .
- PSUs remain fully performance-based on adjusted EPS; no vesting in FY2023 or FY2024 post target adjustments, aligning payout with performance .
- 2024 cash bonuses withheld despite committee discretion due to underperformance across metrics, reinforcing pay-for-performance discipline .
- Strong shareholder support: ~97% Say‑on‑Pay approval in 2024 .
Performance & Track Record
- Strategic actions: Sold Merchant Services business (9/20/2024) for ~$438M and used proceeds to retire all debt on the 2023 Senior Credit Facility; acquired inLumon to bolster Public Sector permitting and licensing .
- FY2024 continuing operations performance: Revenue $229.9M (+1.4%), Adjusted EBITDA $58.3M (down from $59.4M), ARR $188.2M (+7.5%) .
- Pay-versus-performance: Company-selected measure is Adjusted EBITDA from continuing operations; 2024 Net Income included gain on sale effects; CAP framework disclosed .
Compensation Peer Group (Benchmarking)
- FW Cook peer analysis used for FY2023 compensation decisions; peer list included 18 tech/payments/software firms (e.g., EngageSmart, EverCommerce, Repay, PROS, Perficient) .
- Company did not run a peer analysis for FY2024 compensation .
Say‑on‑Pay & Shareholder Feedback
- 97% approval at the February 2024 annual meeting; committee considers vote outcomes in ongoing program evaluations .
Investment Implications
- Alignment: Significant equity exposure (options and PSUs) and anti-hedging/clawback policies support long-term alignment; no severance cash cushion heightens at-risk profile .
- Supply overhang: Annual vesting of ~25–26K option shares through 2028 could create periodic selling pressure, though no option exercises were reported in FY2024 .
- Performance sensitivity: PSU vesting is contingent on pro forma adjusted EPS recovery post-divestiture; failure to meet targets in FY2023–FY2024 led to zero PSU payouts, reinforcing pay-for-performance .
- Retention risk: Larger 2023–2024 option grants with extended vesting support retention; absence of severance for Stanford reduces exit costs but may modestly increase external poaching risk if equity value is subdued .
- Trading signals: Watch quarterly vest dates (Feb 13 annually) for potential insider selling windows and monitor Adjusted EBITDA/EPS trajectory given PSU dependencies and committee’s emphasis on stock performance .