Arnold Scott
About Arnold Scott
Arnold Scott (age 82) is an independent director of Netcapital Inc. (NCPL), serving since December 2022. He chairs the Nominating and Corporate Governance Committee and sits on both the Audit and Compensation Committees, indicating governance oversight experience and cross-committee engagement . His background includes prior bank board leadership and multiple technology and advisory board roles, which contribute to board-level financial and operational oversight .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| First Commons Bank | Director and Vice Chairman | 2008–2017 | Bank governance and oversight |
| Perillon Software | Director | 2015–2019 | Technology company board experience |
| ChipBrain | Director | 2021–2022 | AI/tech startup governance |
| Netcapital Systems LLC (affiliate/shareholder of NCPL) | Board of Managers (Manager) | 2017–2020 | Affiliate oversight; potential historical interlock |
| Alderson Broaddus University | Board of Trustees member | 2013–2020 | Nonprofit governance |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Private Directors Association – Boston Chapter | Founding Member | Since 2020 | Governance community leadership |
| Vestmark | Advisory Board Member | N/A | Fintech advisory role |
| Successimo | Advisory Board Member | N/A | Advisory capacity |
| ai Resources | Advisory Board Member | N/A | Advisory capacity |
| The Capital Network | Advisory Board Member | N/A | Startup ecosystem advisory |
Board Governance
- Committee assignments: Audit Committee member (Chair: Steven Geary); Compensation Committee member (Chair: Avi Liss); Nominating & Corporate Governance Committee Chair (members: Liss, Scott, Geary) .
- Independence: The Board determined Scott is independent under Nasdaq rules; Board majority is independent (Liss, Scott, Geary) .
- Board meetings and actions: FY ended April 30, 2025—Board held no meetings; acted by written consent 19 times; no attendance fees .
- Committee activity: FY ended April 30, 2025—Audit met 4 times and took 2 consents; Compensation held no meetings and 1 consent; Nominating held no meetings and 1 consent; no attendance fees .
- Section 16 compliance: Directors/officers and 10% holders complied with filing requirements in FY2025 per company review .
Fixed Compensation
| Director | Cash Fees ($) | Stock-Based Awards ($) | Option Awards ($) | Non-Equity Incentive ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|---|
| Arnold Scott | 0 | 0 | 0 | 0 | 0 | 0 |
- Policy: As of February 9, 2022, non-employee directors do not receive cash compensation; program is equity-based; reimbursement of reasonable expenses is provided .
Performance Compensation
| Group Grant (Directors non-executive) | Grant Date | Options (#) | Exercise Price ($) | Expiration | Exercisability Condition | Reported Market Value |
|---|---|---|---|---|---|---|
| All directors (group) | June 8, 2025 | 4,000 | 2.68 | June 8, 2035 | Not exercisable until stockholder approval of Plan Amendments | 13,691 |
| All directors (group) | July 31, 2025 | 160,000 | 3.39 | July 31, 2035 | Not exercisable until stockholder approval of Plan Amendments | 547,646 |
- Equity plans: 2023 Plan authorizes options/RSUs and other awards with 10-year termination; the Board/Administrator administers and may adjust upon “change in capitalization” . 2021 Plan authorizes options/RSUs/other awards; as of April 30, 2025, 2,671 director options granted; 1,615 shares remain available .
- Performance conditions: No director-specific performance metrics (TSR/EBITDA targets) disclosed for director awards; options are time-based and subject to shareholder approval gating .
Other Directorships & Interlocks
| Relationship Type | Entity | Detail |
|---|---|---|
| Prior affiliate role | Netcapital Systems LLC | Scott served on board of managers (2017–2020); Systems DE is an affiliate/shareholder of NCPL . Company paid Systems DE $95,000 (FY2025) and $175,000 (FY2024) for software; $285,000 owed as of April 20, 2025 . |
| External boards | First Commons Bank; Perillon Software; ChipBrain; Alderson Broaddus University | See Past Roles for tenures . |
Expertise & Qualifications
- Governance leadership: Chair of Nominating & Corporate Governance; founding member of Private Directors Association – Boston .
- Financial and operational exposure: Experience from bank vice chair role and multiple technology board positions .
- Audit oversight readiness: Serves on Audit Committee; Audit Committee financial expert is Geary (not Scott) per Board determination .
Equity Ownership
| Holder | Beneficial Shares (#) | % of Common Stock | Options Exercisable within 60 Days (#) | Notes |
|---|---|---|---|---|
| Arnold Scott | 1,469 | <1% (based on 3,040,380 shares outstanding) | 179 | Percent not explicitly stated for Scott; “Less than 1%” designation applied for small holders . |
Governance Assessment
- Committee leadership and independence: Scott is independent and chairs Nominating & Corporate Governance, with membership on Audit and Compensation—positive for governance breadth .
- Engagement signal: The Board held zero formal meetings (19 written consents) in FY2025; Compensation and Nominating committees held no meetings (each used one written consent). This reliance on consents may signal limited live oversight and deliberation cadence—a potential engagement red flag .
- Director pay structure: FY2025 shows no cash fees or equity awards recognized for non-employee directors, consistent with the policy, but subsequent 2025 option grants to the director group introduce equity-based incentives with exercisability contingent on shareholder approval—watch for dilution and approval gating .
- Ownership alignment: Scott’s beneficial ownership is small (<1%); includes 179 options currently exercisable within 60 days, indicating limited economic alignment at present scale .
- Related-party exposure: The proxy discloses several related-party transactions (Systems DE; KingsCrowd; Deuce Drone; Zelgor; 6A Aviation) but does not list Scott as a related party in those transactions—no direct conflicts identified for Scott in disclosed items .
- Compliance signal: Section 16 reporting compliance reported for FY2025—neutral-to-positive governance control indicator .
RED FLAGS
- No Board meetings (19 unanimous consents) in FY2025; Compensation and Nominating committees did not meet—potential concern for robust oversight and director engagement .
- Equity grants to director group contingent on shareholder approval—monitor approval outcomes and any award modifications; note aggregate director option grant size (160,000) post-FY end .
Additional Notes
- Lead Independent Director role and executive session frequency are not disclosed in the proxy excerpts reviewed .
- No Form 4 insider transactions were found in the available tool search for NCPL at this time (0 documents)—cannot assess recent trading activity via SEC Form 4 from this source.