Charles Willis IV
About Charles Willis IV
Founder and Executive Chairman of Willis Lease Finance Corporation; Director since 1985, Chairman since 1996, Executive Chairman since April 1, 2022, previously CEO until April 1, 2022; age 76 as of April 7, 2025 . Under his leadership, WLFC’s pay-versus-performance disclosure shows the value of an initial $100 investment reached $562.00 in 2024 and net income was $108.6 million for FY2024, evidencing strong shareholder and financial outcomes . WLFC’s Q3 2025 results included revenue of $183.4 million, EBT of $43.2 million, and net income of $22.9 million, with average portfolio utilization of ~86% and a quarterly dividend raised to $0.40 per share .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Alaska Airlines | Various positions in flight operations, sales & marketing | 1965–1972 | Operational and commercial grounding in airline operations |
| Seaboard World Airlines | Assistant VP of Sales | 1972–1973 | Commercial leadership at a freight carrier |
| Small Business (non-aviation) | Operator | 1974 | Entrepreneurial exposure |
| Charles F. Willis Company | President | 1975–1985 | Purchased/financed/sold large transport aircraft; consulting services to aviation industry |
Fixed Compensation
| Year | Base Salary ($) | Bonus ($) | Stock Awards ($) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|
| 2022 | 1,097,000 | 1,000,000 | 3,909,088 | 207,022 | 6,213,110 |
| 2023 | 1,103,857 | 3,027,643 | 6,486,000 | 160,145 | 10,777,645 |
| 2024 | 1,209,442 | 4,185,726 | 8,609,728 | 152,192 | 14,157,088 |
Note: In September 2024, he received a special one-time, fully vested RSU award valued at $3,000,000 for contributions to strong financial performance and historic stock price highs; committee cited record pre-tax income in Q1/Q2 and stock price more than doubling since Dec 2023 (~$400M shareholder value increase) .
Performance Compensation
| Plan Year | Metric | Weighting | Target | Actual | Payout | Vesting | Shares Earned |
|---|---|---|---|---|---|---|---|
| 2023 cycle (granted 4/1/2023; issued 2024) | Liquidity (non-restricted cash + revolver availability) | N/A (not disclosed) | ≥ $50M → 100% | Exceeded $50M | 100% of target | 1-year time-based after performance cycle | 60,000 performance shares |
| 2023 cycle | Time-based restricted stock | N/A | N/A | N/A | N/A | 3-year ratable vest (grant date 4/1/2023) | 40,000 time-based RS |
| 2024 cycle (granted 4/1/2024; issued 2024) | ROE thresholds (10%, 8%, 6%) | N/A | 10%→100%; 8%→100%; 6%→75% | ROE >10% (FY2023) | Maximum (125% of target) | 2-year time-based after performance cycle | From total earned below |
| 2024 cycle | Net contribution margin thresholds ($30M, $24M, $18M) | N/A | $30M→125%; $24M→100%; $18M→75% | >$30M (FY2023) | Maximum (125% of target) | 2-year time-based after performance cycle | Total earned shares below |
| 2024 total grant (Exec Chairman) | Combined earned perf. shares + time-based RS | — | Target perf. 60,000 | Max earned perf. 75,000 | 125% of target | Perf. shares: 2-year; RS: 3-year ratable (4/1/2024) | 115,000 total (40,000 RS + 75,000 perf.) |
| 2025 cycle (granted 4/1/2025; issued 2025) | ROE thresholds (12.5%, 10%, 7.5%) | N/A | 12.5%→125%; 10%→100%; 7.5%→75% | ROE >12.5% (FY2024) | Maximum (125%) | 2-year time-based after performance cycle | 75,000 perf. shares |
| 2025 cycle | Net contribution margin thresholds ($36.3M, $29.0M, $21.7M) | N/A | $36.3M→125%; $29.0M→100%; $21.7M→75% | >$36.3M (FY2024) | Maximum (125%) | 2-year time-based after performance cycle | Included above |
| 2025 total grant (Exec Chairman) | Combined earned perf. shares + time-based RS | — | Target perf. 60,000 | Max earned perf. 75,000 | 125% of target | Perf. shares: 2-year; RS: 3-year ratable (4/1/2025) | 115,000 total (40,000 RS + 75,000 perf.) |
Equity award timing practices: No options granted to NEOs in fiscal 2024; awards follow a predetermined annual schedule and are not timed to MNPI .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 3,175,676 shares; 41.41% of outstanding as of April 7, 2025 (7,669,763 shares outstanding) |
| Ownership structure | Includes 2,134,148 WLFC shares via CFW Partners, L.P., where Charles Willis IV is 1% GP and 70% LP; also individual holdings and small trust accounts; voting/dispositive powers: sole voting 1,027,146; sole dispositive 801,146; shared voting/dispositive 2,148,530 |
| Unvested restricted stock (voting but not investment power) | 270,903 shares (as of April 7, 2025) |
| Options (year-end 2024) | None outstanding or exercisable (Option Awards columns blank as of 12/31/2024) |
| New option award (retention) | Non-qualified option for 300,000 shares granted Nov 10, 2025; 4 equal annual vesting tranches; 6-year term; exercise price = greater of Grant Date FMV or 5-day VWAP; immediate vesting on change in control; extended exercisability for death/disability/good reason/without cause (≤2 years); forfeiture if terminated for cause; subject to clawback |
| Hedging/pledging policy | Company permits 10b5‑1 plans; has not adopted special hedging policies; no pledging arrangements disclosed in proxy ownership tables or policy section |
| Director ownership compensation | Receives no additional compensation for Board service (compensated as Executive Chairman) |
Employment Terms
| Term | Executive Chairman (Charles Willis IV) |
|---|---|
| Severance (involuntary termination) | 3x base salary + 3x average annual incentives (prior 3 years) + prorated current-year incentives; immediate vesting of all outstanding stock options and restricted stock; continued group benefits for 3 years; continued club membership payments for 3 years; right to purchase/assume company car lease; lump-sum if terminated with less than 1-year contractual notice (pro-rated base salary) |
| Change-of-control | Immediate vesting of all stock options and restricted stock (single-trigger acceleration) |
| Retirement | Purchase/assume car lease; continued club memberships; continued group benefits for 1 year |
| 280G cutback | Payments reduced if needed to avoid 4999 excise tax, only if after-tax NPV is greater/equal with reduction |
| Clawback | Compensation Recovery Policy mandates recoupment of erroneously awarded incentive comp after restatements regardless of fault (applies from Oct 2, 2023) |
Board Governance
- Role and tenure: Founder; Director since 1985; Chairman since 1996; Executive Chairman since April 1, 2022; previously CEO until April 1, 2022 .
- Board structure: No independent Chair or Lead Independent Director; Audit and Compensation Committees are comprised solely of independent directors and chaired by independents .
- Committee memberships: Audit Committee (Curran—Chair, Barrington, Jones); Compensation Committee (Jones—Chair, Barrington, Curran); Executive Chairman not listed as a member of these independent-only committees .
- Meeting cadence: 9 Board meetings in FY2024; each incumbent Director attended at least 75% of Board and committee meetings; 6 meetings included independent Directors’ executive sessions .
- Independence: Independent Directors are Barrington, Curran, Jones; Executive Chairman is a non-independent director .
- Director compensation: Executive Chairman receives no additional compensation for Board service; non-employee Director compensation is disclosed separately .
Related-Party Transactions
| Counterparty | Nature | Amount/Timing | Approval |
|---|---|---|---|
| Fur and Feather and Fin Limited | Hangar lease from Willis Asset Management Limited (subsidiary); entity with Executive Chairman ownership interest | ~$7,700 per quarter (Jan–Jul 2023) | Approved by independent Directors |
| Mikchalk Lake, LLC | Lodging and business-related services; entity with Executive Chairman ownership interest | ~$44,000 in 2023 | Approved by independent Directors |
| Section 16(a) compliance | Late Form 4 filed by Charles Willis on May 29, 2024 for May 23, 2024 transactions (administrative oversight) | Notified in 2025 proxy | — |
Performance Context
| Metric | FY2024 / Period | Detail |
|---|---|---|
| Pay-versus-performance TSR | $100 → $562.00 (cumulative) | Indicates strong multi-year shareholder return value in the disclosed period |
| Net Income | $108.6 million (FY2024) | GAAP net income per audited statements |
| Q3 2025 revenue | $183.4 million | +25.4% YoY; record leasing revenues |
| Q3 2025 EBT and Net Income | EBT $43.2 million; Net Income $22.9 million | EBT +25.4% YoY; diluted EPS $3.25 |
| Utilization | ~86% average utilization in Q3 2025; lease rate factor ~1% | |
| Dividend | Raised to $0.40 per share (announced subsequent to Q3) |
Compensation Structure Analysis
- Mix shift: Cash bonus and stock awards increased from 2023 to 2024 (bonus from $3.03M to $4.19M; stock awards from $6.49M to $8.61M), driven by maximum performance share outcomes and a one-time RSU award .
- Option introduction: After no options at 2024 year-end, a large retention option (300,000 shares) was granted in Nov 2025 with four-year vesting and change-of-control acceleration, signaling retention emphasis and potential future exercise dynamics .
- Performance metrics: Equity awards tied to ROE and net contribution margin; company exceeded maximum thresholds in consecutive cycles (2023→issued 2024; 2024→issued 2025), producing 125% payouts, with subsequent time-based vesting .
- Clawback and tax: Dodd-Frank clawback policy in place; severance agreements include 280G cutback (no tax gross-ups), reducing shareholder-unfriendly features .
Equity Ownership & Alignment Commentary
- High alignment: ~41% beneficial ownership concentrates economic incentives; combined with large shared voting/dispositive powers via CFW Partners .
- Pledging/hedging: No pledging disclosure; hedging policy not specially adopted (insider trading policy applies), implying continued need to monitor potential alignment risks from derivative strategies .
- Vesting overhang: Significant unvested RS as of April 2025 (270,903 shares) and multi-year vesting from 2024/2025 performance grants may create periodic sell windows; addition of 300,000 options introduces future exercisability events .
Employment Terms
| Provision | Detail |
|---|---|
| Notice period | 1-year notice required; lump-sum pro-rated base if shorter notice on termination |
| Benefits continuation | 3 years post-involuntary termination; 1 year post-voluntary retirement for certain benefits |
| Equity acceleration | Immediate vesting of options and RS on change of control; immediate on involuntary termination |
| 280G | Cutback provision; no gross-up |
Investment Implications
- Alignment and control: A ~41% stake suggests strong “skin-in-the-game,” but also governance concentration (non-independent Chair, family CEO); independent committees and executive sessions partly mitigate oversight concerns .
- Retention vs. dilution: The 300,000-share option grant with four-year vesting is a clear retention tool; it introduces future potential exercises and supply overhang, particularly with single-trigger change-of-control acceleration .
- Pay-for-performance: Maximum performance-share outcomes tied to ROE and net contribution margin align equity payouts with core profitability drivers; the discretionary $3M RSU award for 2024 performance and stock appreciation warrants monitoring for precedent-setting and pay inflation risk .
- Trading signals: Multi-year vesting schedules (2–3 years) and option exercisability windows may coincide with insider Form 4 activity; prior late Form 4 indicates administrative oversight risk—monitor filings around vest dates and 10b5‑1 plans .
- Performance backdrop supportive: Strong Q3 2025 results and dividend increase underpin compensation outcomes; however, governance structure (no independent Chair/Lead) and related-party transactions merit ongoing scrutiny for minority shareholder protections .