Michael Gross

About Michael Gross

Michael S. Gross (age 63) is Chairman of the Board, Co‑Chief Executive Officer, and President of SLR Investment Corp. (SLRC), serving as a Class III director since 2007; he was Sole CEO from February 2007 to June 2019 and Co‑CEO since June 2019 . He is an “interested” director under the 1940 Act given his executive roles at SLRC and managing‑member status at the external adviser, SLR Capital Partners; the Board does not have a Lead Independent Director, and Gross also serves as Board Chair, a dual role mitigated by independent‑only committees and regular executive sessions of independent directors . The Board’s annual advisory‑agreement reviews have judged adviser services satisfactory and SLRC performance “reasonable” versus peers and relevant indices, but the proxy does not disclose TSR, revenue or EBITDA growth for Gross’s tenure . Gross also serves as Chairman of Global Ship Lease, Inc. and chairs affiliated unlisted BDCs advised by SLR Capital Partners .

Past Roles

External Roles

Fixed Compensation

SLRC is an externally managed BDC and does not directly compensate executive officers. Gross and Co‑CEO Spohler participate economically via their ownership of SLR Capital Partners (the adviser) and receive a portion of adviser profits funded in part by SLRC’s advisory fees; they receive no additional compensation from the adviser specific to managing SLRC’s portfolio . SLRC has no stock or option plan, non‑equity incentive plan, or pension plan for directors or officers; interested directors (including Gross) receive no director fees from SLRC .

Performance Compensation

SLRC currently pays no incentive‑based compensation to executive officers; therefore, no company‑level performance metrics, targets, or payout formulas apply to Gross. A clawback policy was adopted effective November 6, 2023 to recover erroneously awarded incentive‑based compensation in the event of a restatement, although no such compensation is currently paid and no recoveries have been required to date .

Equity Ownership & Alignment

• Gross is a significant shareholder with multi‑year increases in reported beneficial ownership; he is categorized as an “interested” director (not independent) .

Ownership trend (shares and % of outstanding):

Selected ownership components (as disclosed):

• Direct/plan/trust holdings: 152,166 shares in Profit Sharing Plan; 117,617 shares in Family Trusts; 334,428 shares in a GRAT for which he serves as trustee .
• Entity/affiliated holdings where “a portion may be deemed” beneficially owned by Gross: Solar Capital Investors, LLC (1,285,013); Solar Capital Investors II, LLC (715,000); Solar Senior Capital Investors, LLC (355,107); SLR Capital Management (77); Solar Capital Partners Employee Stock Plan LLC (925,474 in 2025; 845,452 in 2024; 318,511 in 2022). Gross disclaims beneficial ownership in these entities beyond his pecuniary interest .

Alignment and risk considerations:

• Hedging: The Joint Code does not expressly prohibit hedging/derivative transactions in SLRC stock; pre‑clearance is required for “Reportable Securities” (independent directors excluded). This policy design can permit hedging that reduces alignment, subject to compliance review .
• Pledging: No pledging disclosures for Gross were identified in the reviewed proxies .
• Section 16: Company reports timely Section 16 compliance in 2024, noting one late Form 4 for another director (no exceptions for Gross) .

Employment Terms

• As an externally managed BDC, SLRC discloses no company‑level employment agreement for Gross, and no company‑paid severance or change‑of‑control benefits. Director indemnification agreements are in place, providing maximum indemnification and advancement of expenses as permitted by Maryland law and the 1940 Act .
• Advisory/administration structure: SLRC pays advisory and administrative fees to affiliates (SLR Capital Partners and SLR Capital Management). Gross is a managing member of SLR Capital Partners and has financial/controlling interests in the adviser; related‑party and allocation conflicts are managed under policies, an SEC co‑investment exemptive order (June 13, 2017), and committee oversight .

Board Governance (service history, committee roles, dual‑role implications)

• Service history: Class III director since 2007; Chairman of the Board; re‑nominated/elected in 2024 for a term expiring 2027 .
• Independence: Gross is an “interested” director; only independent directors serve on Audit, Nominating & Corporate Governance, and Compensation Committees .
• Committees/attendance: In 2024, the Board met 5 times; Audit 5; Nominating 1; Compensation 1; all directors attended at least 75% of meetings (committee membership is independent‑only; Gross does not sit on these committees) .
• Leadership structure: Combined Chair/Co‑CEO role; no Lead Independent Director. The Board cites independent‑only committees and executive sessions of independent directors as mitigants .
• Director compensation: Interested directors (Gross) receive no director fees from SLRC; independent director fee framework disclosed (for context) .

Performance & Track Record

• Adviser oversight: In annual Section 15(c) reviews, the Board (including a majority of independent directors) concluded the adviser’s services are satisfactory and SLRC’s performance “reasonable” relative to peers and indices; advisory fee levels deemed reasonable .
• Quantitative TSR or operating KPIs over Gross’s tenure were not disclosed in the reviewed proxy statements .

Compensation Committee Analysis

• Committee composition: Independent‑only; Chair: Leonard A. Potter. Scope includes advisory/administration agreement reviews; if SLRC ever directly compensates executives, the committee would oversee that program .
• Consultants: Committee has authority to retain compensation consultants, but SLRC engages none because it does not directly compensate executives .
• Say‑on‑Pay: Not applicable; no executive compensation program at SLRC .

Related Party Transactions (governance red flags)

• Advisory and administration agreements with affiliates where Gross has financial interests; SLRC pays fees to adviser/administrator; allocation/co‑investment conflicts are governed by policy and an SEC exemptive order .
• Board acknowledges potential conflicts (e.g., fee base tied to asset levels) in its advisory‑agreement deliberations and cites controls and oversight in mitigating them .

Risk Indicators & Red Flags

• Dual role (Chairman and Co‑CEO) with no Lead Independent Director .
• Hedging not expressly prohibited by policy (pre‑clearance required) .
• Extensive related‑party arrangements (advisory/administration fees; shared leadership across affiliated BDCs) .
• High insider ownership (beneficial stake ~7.5%), which can be positive for alignment but may concentrate influence .

Investment Implications

• Alignment: Gross’s sizable beneficial ownership and long tenure signal alignment, but the compensation linkage is primarily through adviser economics rather than company‑level pay‑for‑performance—investors should underwrite the advisory fee structure and capital allocation track record more than traditional exec comp plans .
• Governance: The combined Chair/Co‑CEO structure and absence of a Lead Independent Director elevate governance risk; independent‑only committees and executive sessions partially mitigate this. Monitor committee rigor (valuation, advisory reviews) and any moves toward enhancing independent leadership .
• Trading signals: No company‑level vesting overhang (no RSUs/options at SLRC) and no reported Section 16 exceptions for Gross; ownership increased from ~3.41M (2022) to ~4.11M shares (2025). Without a company equity plan, near‑term insider selling pressure from vesting is minimal; continue to monitor Form 4 activity and any disclosures on pledging/hedging given the permissive hedging policy framework .
• Retention/transition: With no company employment or severance agreements, retention risk is tied to the adviser’s internal incentives and ownership; continuity hinges on SLR Capital Partners’ stability and economics reviewed annually under Section 15(c) .