Donald Poulton

About Donald Poulton

Donald S. Poulton is Chief Executive Officer and President of Medallion Bank (subsidiary of Medallion Financial Corp.) since May 2015, having joined Medallion Bank in August 2002 as Chief Lending Officer; previously he was Chief Lending Officer and Executive Vice President of American Investment Financial; he holds a B.S. in finance from the University of Utah and serves on the board of the Utah Microenterprise Loan Fund . In 2024, his annual STI scorecard paid at 84.87% of target driven by corporate net income and ROE above target, offset by Medallion Bank segment net income and ROA below target . As of April 14, 2025, he beneficially owned 313,108 shares (1.34% of outstanding), including 95,033 options exercisable within 60 days and 68,417 restricted shares; PSUs are excluded from beneficial ownership until earned .

Past Roles

External Roles

Fixed Compensation

Base salary setting and continuity:

Reported cash compensation (Summary Compensation Table):

Notes:

• 2024 base salary was set at $472,500 with no increase vs 2023 , while salary paid in the SCT shows $427,500 for 2024 .

Performance Compensation

STI target and payout:

2024 STI scorecard details:

LTI mix and grants:

PSU metrics and vesting:

• PSUs vest based on Company PTI and ROE over a three-year period ending Dec 31, 2026, with vesting certified by the Compensation Committee; payout range 0–200% of target; vesting contingent on continued employment through certification .

Equity Ownership & Alignment

Beneficial ownership (as of April 14, 2025):

Outstanding equity awards (12/31/2024):

Vesting schedules:

• One-third of RSAs vest on March 1 of 2025, 2026, and 2027 .
• PSUs earn over 2024–2026 based on PTI and ROE; vest after Compensation Committee certification post-12/31/2026 .

Ownership policies:

• Stock ownership guidelines: executives must hold shares equal to 1x–5x base salary depending on tier; applies to all executive officers and directors (Tier 1: 5x for Company CEO/President; Tier 2: 2x; Tier 3: 1x) .
• Insider trading policy prohibits short sales, derivatives, hedging transactions, and margin purchases; no explicit disclosure regarding pledging in policy excerpt .

Employment Terms

• Agreement effective January 1, 2016; two-year term automatically renews each year for a new two-year term unless either party gives non-renewal notice .
• Base salary initially $325,000 (2016) with annual increases of no less than 3% beginning in 2017; eligible for discretionary bonus with a minimum $225,000 if Medallion Bank consumer lending ROE/ROA met specified historical comparables (2014–2015 averages) .
• Severance (termination without cause/for good reason, or non-assumption of agreement upon change in control): lump sum of base salary for remaining period in current term; continued health benefits through term/COBRA; additional lump sum equal to two weeks’ salary per year of service capped at three months’ base salary; immediate vesting of all unvested stock options and restricted shares .
• Disability termination: continued base salary for six months and continued health benefits for six months .
• Change in control (agreement assumed or comparable employment offered): lump sum equal to nine months’ salary .
• Current term expiry and accelerated vesting values: current employment term expires December 31, 2025; as of Dec 31, 2024, unvested options of 9,824 at $6.79 and 76,597 unvested restricted shares; acceleration value $744,7888 (calculated at $9.39 closing price on Dec 29, 2024) with health benefits continuation; awards not subject to clawback upon acceleration .
• Non-compete and non-solicitation during employment and for 24 months thereafter (exceptions apply following certain terminations) .
• Clawback/recoupment: Company must recoup erroneously paid incentive compensation in the event of a financial restatement .

Compensation Structure Analysis

• Pay mix and trends: 2024 LTI was a 50–50 mix of time-based RSAs and performance-based PSUs; RSAs $295,313 and PSUs $295,313 grant-date fair values (max PSU fair value $590,625), consistent with 2023–2022 program emphasis on equity and performance pay .
• STI alignment: 2024 STI metrics balanced across corporate and segment measures; corporate net income and ROE exceeded targets while segment net income and ROA missed, yielding 84.87% of target and $501,291 payout .
• Governance and controls: independent compensation consultant (Meridian) engaged in 2024; no option repricing without shareholder approval; dividends/dividend equivalents do not pay on unvested awards; insider trading policy prohibits hedging and margin purchases .

Investment Implications

• Alignment: Meaningful equity stake (313,108 shares, 1.34% of outstanding) plus substantial unvested RSAs/PSUs and option exposure align incentives with shareholder outcomes; stock ownership guidelines further reinforce alignment .
• Vesting calendar and potential supply: RSA tranches vest on March 1 in 2026 and 2027, and PSUs certify post-12/31/2026; combined with outstanding exercisable options, these dates could concentrate selling windows depending on personal liquidity needs and policy constraints .
• Retention and CoC economics: Auto-renewing two-year term and severance protection (remaining-term salary + service-based add-on, health benefits, and accelerated vesting) reduce near-term retention risk; CoC cash payout of nine months’ salary if agreement is assumed/offered comparable terms is moderate versus market norms .
• Pay-for-performance: 2024 STI payout below target due to Medallion Bank ROA and net income shortfalls, indicating sensitivity of cash incentives to segment performance while corporate metrics were met; PSU design (PTI and ROE) extends performance alignment through 2026 .
• Governance risk: Clawback/recoupment policy in place; no disclosure of pledging, and hedging/margin transactions are prohibited, lowering alignment red flags; no indication of option repricing or tax gross-ups in the excerpts reviewed .