David Shane
About David Shane
David N. Shane, age 77, is an independent director at Merchants Bancorp (MBIN) who has served on the board since 2013. He is designated an audit committee financial expert and brings extensive legal and business leadership experience, including prior service as President and CEO of LDI Ltd., LLC and as a partner at Baker & Daniels LLP. He holds a BA from Wabash College and a JD from Duke University School of Law. Shane is one of six independent directors on MBIN’s 11-member board.
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| LDI Ltd., LLC (Indianapolis diversified holding company) | President & CEO; Board of Managers | 2007–2013 | Led a middle-market holding company; governance and operational oversight. |
| LDI Ltd., LLC | Vice President; Executive Vice President | 1997–2006 | Senior executive leadership across portfolio companies. |
| Baker & Daniels LLP (now Faegre Drinker) | Attorney; Partner | 1975–1995 | Legal expertise in corporate matters; strengthens board oversight skills. |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Lilly Endowment, Inc. | Director | Current | Major philanthropic institution; potential network benefits. |
| The Mind Trust | Director | Current | Education innovation nonprofit. |
| Ascend Indiana, Inc. | Director | Current | Workforce development nonprofit. |
| Wabash College | Trustee (Emeritus) | Prior | Higher education governance. |
| Our Health, Inc.; Syndicate Sales, Inc. | Director | Prior | Prior private company boards; no public company boards in past 5 years. |
Board Governance
- Independence: MBIN identifies Shane as one of six independent directors under Nasdaq and SEC rules.
- Committee assignments: Shane is a member of Audit, Compensation, Nominating & Corporate Governance, and chairs the Risk Committee; he is an “audit committee financial expert.”
- Lead Independent Director: Andrew A. Juster serves as Lead Independent Director under the Board’s charter when CEO and Chair are combined.
- Meetings/attendance: Board held 6 meetings in 2024; all directors attended at least 75% of Board and committee meetings (one exception: Sellers missed one of 2 Compensation meetings). Shane’s specific attendance is not singled out, implying ≥75%.
- Committee meeting cadence (2024): Audit (8), Compensation (2), Nominating (1), Risk (4).
| Committee | Role | 2024 Meetings |
|---|---|---|
| Audit | Member; Financial Expert | 8 |
| Compensation | Member | 2 |
| Nominating & Corporate Governance | Member | 1 |
| Risk | Chair | 4 |
Fixed Compensation
- MBIN’s director pay structure effective January 2024: $140,000 annual retainer split $70,000 cash and $70,000 restricted common stock paid quarterly; no meeting fees; no subsidiary board fees. Committee chair retainers: Audit $17,500; Risk $17,500; Compensation $12,500; Nominating $10,000; Lead Independent Director $15,000 if applicable.
- 2024 actual director compensation for Shane: $87,500 cash fees (base $70,000 + Risk Chair $17,500), $70,079 stock awards; total $157,579.
| Component (2024) | Amount ($) |
|---|---|
| Cash Fees (base + chair) | 87,500 |
| Stock Awards (fair value) | 70,079 |
| Total | 157,579 |
Notes:
- Quarterly stock installments based on closing prices: Feb $38.75 (2/13/2024), May $43.04 (5/15/2024), Aug $40.78 (8/14/2024), Nov $39.00 (11/19/2024), rounded up to whole shares.
Performance Compensation
- MBIN discloses no performance-based components for non-executive directors; director equity is time-based restricted common stock, not linked to performance metrics.
Other Directorships & Interlocks
- Public company boards: None in past five years, per MBIN’s disclosure for nominees.
- Related party/interlocks: Compensation Committee interlocks reported none requiring disclosure; routine loans in ordinary course permitted by policy/regulation. No Shane-specific related-party transactions disclosed.
Expertise & Qualifications
- Designated audit committee financial expert; capable of reading and understanding fundamental financial statements.
- Legal and executive leadership background equips Shane for risk oversight and governance.
- Board’s risk governance assigns the Risk Committee oversight of enterprise risk across strategic, credit, operational, compliance, fraud, reputational, interest rate, and market risks.
Equity Ownership
| Holder | Shares Beneficially Owned | % of Outstanding |
|---|---|---|
| David N. Shane | 21,512 | <1% |
Context:
- Shares outstanding at Record Date: 45,881,706.
- MBIN does not require minimum stock ownership for directors/executives and does not prohibit hedging or pledging, subject to insider trading policy and General Counsel approval.
Governance Assessment
- Strengths: Independent director with deep legal and executive experience; chairs Risk Committee; designated audit committee financial expert; broad committee engagement; Lead Independent Director structure mitigates combined CEO/Chair.
- Alignment concerns: No director ownership guidelines; hedging/pledging not prohibited—weakens alignment, a potential red flag for investors.
- Pay structure: Director compensation increased in 2024 after Aon’s review found MBIN at bottom decile versus peers; current mix is roughly 56% cash / 44% equity for Shane ($87.5k cash, $70.1k equity). This may improve recruitment but raises pay inflation risk.
- Related-party environment: Board-level related party dealings exist (e.g., Dinwiddie’s law firm fees; CEO family employment), though none tied to Shane; Audit Committee oversees conflicts under Code of Conduct.
- Shareholder input: Say-on-pay received over 70% support in 2024; frequency vote in 2023 favored annual (98%+). While executive-focused, these signals indicate general shareholder acceptance of MBIN’s compensation governance.
RED FLAGS to monitor: Absence of director ownership requirements; hedging/pledging permissibility; combined CEO/Chair structure (mitigated by LID). No Shane-specific conflicts disclosed.
Appendix: Director Compensation Structure Details (for context)
- Annual director retainer: $140,000 (cash $70,000 + stock $70,000), stock paid in equal quarterly installments; no meeting fees or subsidiary board fees.
- Chair retainers: Audit $17,500; Risk $17,500; Compensation $12,500; Nominating $10,000; LID $15,000.
- 2024 stock installment pricing dates: Feb 13 ($38.75), May 15 ($43.04), Aug 14 ($40.78), Nov 19 ($39.00).