(Name of Registrant as Specified in its Charter) (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant) |
| DATE & TIME Tuesday, June 11, 2024 10:00 a.m., Central LOCATION www.virtualshareholder meeting.com/GRBK2024 RECORD DATE April 19, 2024 | |
| How to Vote BY INTERNET www.proxyvote.com BY TELEPHONE 1-800-690-6903 BY MAIL Mark, sign and date your proxy card and return in the postage-paid envelope we have provided. | |
| | | | Items of Business | | | | |
| 1. | | | Election of seven directors to the Board | | |||
| | | | Recommendation: FOR | | | Page: 5 | |
| 2. | | | To ratify the appointment of RSM US LLP as our Independent Registered Public Accountants for 2024 | | |||
| | | | Recommendation: FOR | | | Page: 49 | |
| 3. | | | To approve the 2024 Omnibus Incentive Plan | | |||
| | | | Recommendation: FOR | | | Page: 52 | |
| | We mailed a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy statement and annual report for the year ended December 31, 2023 on or about April 29, 2024. Our proxy statement and annual report are available online at: www.proxyvote.com. | | |
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| ii | | |||
2024 Proxy Statement | | | |
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Date and Time: | | Tuesday, June | | ||
| Place: | | Our meeting will be held in a virtual format only, | | |
| Record Date: | | | April | |
| Proposal | | | | | | Board Recommendations | |
| | Election of | | | FOR each nominee | | ||
| Proposal 2: | | | Ratification of | | | FOR | |
| Proposal 3: | | | Approval of 2024 Omnibus Incentive Plan (page 52) | | | FOR | |
| | | 2024 Proxy Statement | | | 1 | |
| Proxy Summary | ||||||||||
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| 2 | | | 2024 Proxy Statement | | | |
| Proxy Summary | |
| | | | | | | AGE | | | DIRECTOR SINCE | | | Audit | | | Comp. | | | G&S | |
| | | David Einhorn, Chairman President Greenlight Capital, Inc. | | | 55 | | | 2006 | | | | | | | | | |||
| | | James R. Brickman Chief Executive Officer Green Brick Partners, Inc. | | | 72 | | | 2014 | | | | | | | | | |||
| | | Elizabeth K. Blake Retired General Counsel | | | 72 | | | 2007 | | | | | | | | | |||
| | | Harry Brandler Retired Chief Financial Officer | | | 52 | | | 2014 | | | | | | | | | |||
| | | Lila Manassa Murphy Chief Financial Officer, Dundee Corporation | | | 52 | | | 2022 | | | | | | | | | |||
| | | Kathleen Olsen Retired Chief Financial Officer Eminence Capital, LLC | | | 52 | | | 2014 | | | | | | | | | |||
| | | Richard S. Press Retired Senior Vice President Wellington Management | | | 85 | | | 2014 | | | | | | | | |
| | | Chair | | |
| | | Member | |
| | | 2024 Proxy Statement | | | 3 | |
| Proxy Summary | |
| Annual election of directors 100% independent Board committees 5 out of our 7 Board nominees are independent Directors elected by majority vote Director resignation policy for all directors in uncontested elections Robust stock ownership guidelines applicable to directors and executive officers Executive officer compensation recoupment “clawback” policy | | | Independent directors meet in executive session without management present Strong Board oversight of risk management process Audit Committee has oversight of cybersecurity and information systems risk Policies prohibiting hedging and pledging of shares by executive officers and directors Proxy access allows stockholders to nominate directors and have nominees included in the proxy statement Addition of sustainability responsibilities to Governance committee Regular stockholder engagement | |
| 4 | | | 2024 Proxy Statement | | | |
| PROPOSAL NO. 1 ELECTION OF DIRECTORS | |
| Seven individuals have been nominated to serve as our directors for the ensuing year and until their successors shall have been duly elected and qualified. All nominees are presently directors. The persons named as proxies in the accompanying proxy card have advised management that unless authority is withheld in the proxy, they intend to vote for the election of the individuals identified as nominees below. We do not contemplate that any nominee named below will be unable or will decline to serve. However, if any nominee is unable to serve or declines to serve, the persons named in the accompanying proxy card may vote for another person, or persons, in their discretion, unless our Board chooses to reduce the number of directors serving on the Board of Directors (the “Board”). | |
| THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE BELOW DIRECTOR NOMINEES. | |
| | | 2024 Proxy Statement | | | 5 | |
| Proposal No. 1 – Election of Directors | |
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| | | BACKGROUND: | ||||||||||||
Skills & | |
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| Chief Executive Officer & Director DIRECTOR SINCE: 2014 | | | BACKGROUND: Mr. Brickman has served as one of our | |||||||||||
Skills & | | ||||||||||||||
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| 6 | | | 2024 Proxy Statement | | | |
| Proposal No. 1 – Election of Directors | |
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| INDEPENDENT • Governance | | | BACKGROUND: Ms. Blake has served as one of our directors since September 2007. Before retiring, Ms. Blake served as Senior Vice President — Advocacy, Government Affairs & General Counsel of Habitat | |||||||||||
Skills & | | ||||||||||||||
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| | | 2024 Proxy Statement | | | 7 | |
| Proposal No. 1 – Election of Directors | |
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| HARRY BRANDLER INDEPENDENT AGE: 52 DIRECTOR SINCE: 2014 COMMITTEES: • Compensation (Chair) • Governance & Sustainability | | | BACKGROUND: Mr. Brandler has served as one of our directors since October 2014. Before retiring, | |||||||||||
Skills & | | ||||||||||||||
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| 8 | | | 2024 Proxy Statement | | | |
| Proposal No. 1 – Election of Directors | |
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| Audit (Chair) • | | | BACKGROUND: | |||||||||||
Skills & | | ||||||||||||||
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| | | 2024 Proxy Statement | | | 9 | |
| Proposal No. 1 – Election of Directors | |
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| KATHLEEN OLSEN INDEPENDENT AGE: 52 DIRECTOR SINCE: 2014 COMMITTEES: • Audit • Governance & Sustainability | | | BACKGROUND: Ms. Olsen has served as one of our directors since October 2014. Since 2011, Ms. Olsen has been a private investor. From 1999 through 2011, Ms. Olsen served as Chief Financial Officer of Eminence Capital, LLC, a long/short global equity fund. From 1993 to 1999, Ms. Olsen served as audit manager, specializing in investment partnerships, at Anchin, Block & Anchin LLP, a public accounting firm located in New York City. Since 2021, Ms. Olsen has been an adjunct professor at Fordham Gabelli School of Business. Ms. Olsen received a Bachelor of Science degree with honors from the State University of New York at Albany. In addition, Ms. Olsen currently sits on the Board of Trustees of Lockwood-Mathews Mansion Museum and Saint Catherine Center for Specials Needs. Ms. Olsen is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants and New York State Society of Certified Public Accountants. | |||||||||||
Skills & | | ||||||||||||||
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| 10 | | | 2024 Proxy Statement | | | |
| Proposal No. 1 – Election of Directors | |
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| INDEPENDENT • Governance & Sustainability (Chair) • Insurance (Chair) | | | BACKGROUND: Mr. Press has served as one of our directors since October 2014. Before retiring, Mr. Press was a Senior Vice President at Wellington Management from 1994 to 2006, where he started and built the firm’s insurance asset management practice. Prior to that, Mr. Press was a Senior Vice President of Stein Roe & Farnham from 1982 to | |||||||||||
Skills & | | ||||||||||||||
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| | | 2024 Proxy Statement | | | 11 | |
| Proposal No. 1 – Election of Directors | |
| | | | | | SKILLS AND QUALIFICATIONS | | | | DAVID EINHORN | | | | JAMES R. BRICKMAN | | | | ELIZABETH K. BLAKE | | | | HARRY BRANDLER | | | | LILA MANASSA MURPHY | | | | KATHLEEN OLSEN | | | | RICHARD S. PRESS | | |
| | | | | INDUSTRY EXPERIENCE Experience in homebuilding, land development, real estate brokerage and sales and financing and banking in the real estate industry or in analyzing or consulting in these key areas enables our Board to understand key operational aspects of our homebuilding business and provide important perspective from their relevant expertise. | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||
| | | | | EXECUTIVE LEADERSHIP Experience in positions that require strategic vision, leadership and decision making enables our Board to provide sound business judgment, leadership and strategic vision. | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
| | | | | ACCOUNTING/FINANCE/CAPITAL MARKETS Experience in accounting, finance or capital markets enables our Board to provide insight and guidance on financial reporting, internal controls and our capital structure and to evaluate our investment and capital raising and allocation strategies. | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
| | | | | LEGAL/REGULATORY/CORPORATE GOVERNANCE Experience in legal, regulatory and corporate governance provides our Board an understanding of the regulatory environment in which we operate, especially with our new captive insurance company and assists in the evaluation of risk. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||
| | | | | RISK MANAGEMENT Experience in overseeing risk management matters including cybersecurity risks, strengthens the Board’s oversight of the risks facing Green Brick. | | | | | | | | | | | | | | | | | | | | | | | | | |||||||
| | | | | PUBLIC COMPANY DIRECTORSHIP Experience advising or serving on other public company boards enables our Board to have a solid background and the knowledge necessary to understand its oversight and governance roles. | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12 | | | 2024 Proxy Statement | | | |
| Proposal No. 1 – Election of Directors | |
| | | 2024 Proxy Statement | | | 13 | |
| | Independent Director | | | Audit Committee | | | Compensation Committee | | | Governance and Sustainability Committee | | | Insurance Committee | | |
| | Elizabeth K. Blake | | | | | | Member | | | Member | | | | | |
| | Harry Brandler | | | | | | Chair | | | Member | | | | | |
| | Lila Manassa Murphy | | | Chair | | | Member | | | | | | | | |
| | Kathleen Olsen | | | Member | | | | | | Member | | | | | |
| | Richard S. Press | | | Member | | | | | | Chair | | | Chair | | |
| 14 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| AUDIT COMMITTEE | | ||||
| Members: Lila Manassa Murphy (Chair) Kathleen Olsen Richard S. Press Meetings in 2023: 5 | | | | Responsibilities The Audit Committee’s responsibilities include: • assist Board oversight of the accounting and financial reporting processes of Green Brick, the integrity of the financial statements, and the audits of the financial statements of Green Brick; • assist the Board oversight of the Company’s compliance with legal and regulatory requirements, including reviewing and overseeing the Company’s information and technology risks, including cybersecurity; • oversee the assessment of financial risk and financial risk management programs; • evaluate the independence, qualifications, and performance of the independent auditors; • engage and oversee the independent auditors; • oversee the integrity and adequacy of internal controls and the quality and adequacy of disclosures to stockholders; • oversee the performance of Green Brick’s internal audit function; and • perform all other duties required under the charter, assigned by the Board or required by regulation or law. | |
| | | | | Independence and Financial Expertise The Board reviewed the background, experience and independence of the Audit Committee members and based on this review the Board determined that each member of the Audit Committee: • meets the New York Stock Exchange (“NYSE”) Listing Standards and SEC requirements for independence with respect to audit committee members; and • is financially literate, knowledgeable and qualified to review financial statements. Ms. Olsen and Ms. Manassa Murphy have been determined to be “audit committee financial experts” as such term is defined in the rules and regulations of the SEC. | |
| | | | | The charter provides that a member of the Audit Committee shall not simultaneously serve on the audit committees of more than two other public companies. None of the members of our Audit Committee currently serve on the audit committees of more than two other public companies. | |
| | | 2024 Proxy Statement | | | 15 | |
| Corporate Governance | |
| COMPENSATION COMMITTEE | | ||||
| Members: Harry Brandler (Chair) Elizabeth K. Blake Lila Manassa Murphy Meetings in 2023: 5 | | | | Responsibilities The Compensation Committee’s responsibilities include: • discharge the responsibilities of the Board relating to the compensation of Green Brick’s Chief Executive Officer and other executive officers; • review and approve corporate goals and objectives relevant to the compensation of Green Brick’s Chief Executive Officer and other executive officers; • oversee the administration of Green Brick’s compensation plans, including any incentive compensation and equity-based plans; • oversee the adoption and administration of Green Brick’s executive compensation Clawback policy; • assist the Board in establishing and administering fair and equitable compensation policies and practices designed to enhance Company performance, retain key employees and align the interests of executive officers and other employees with the interests of the stockholders; • recommend to the Board compensation for directors; • oversee the competency, qualifications and performance of executive officers; • review, assess and make reports and recommendations to the Board as appropriate on succession planning with respect to the executive officers; • produce a report on executive compensation each year for inclusion in the proxy statement; and • perform all other duties required under the charter, assigned by the Board or required by regulation or law. | |
| | | | | Independence The Board reviewed the background, experience and independence of the Compensation Committee members and based on this review, the Board determined that each member of the Compensation Committee is independent and a non-employee pursuant to: • NYSE Listing Standards; and • Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). | |
| 16 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| | | 2024 Proxy Statement | | | 17 | |
| Corporate Governance | |
| GOVERNANCE & SUSTAINABILITY COMMITTEE | | ||||
| Members: Richard S. Press (Chair) Elizabeth K. Blake Harry Brandler Kathleen Olsen Meetings in 2023: 5 | | | | Responsibilities The Governance & Sustainability Committee’s responsibilities include: • identify, review the qualifications of, and recommend candidates for Board membership, consistent with criteria set forth in the charter; • determine the composition of the Board and its committees; • develop corporate governance guidelines for Green Brick and oversee compliance with them; • monitor Board and management effectiveness; • assist the Board in overseeing and monitoring Green Brick’s development and integration of material corporate governance, social and environmental strategies; and • perform all other duties required under the charter, assigned by the Board, or required by regulation or law. | |
| | | | | Independence The Board reviewed the background, experience and independence of the Governance & Sustainability Committee members and based on this review the Board determined that each member of the Governance & Sustainability Committee meets the independence requirements of the NYSE’s Listing Standards. | |
| 18 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| | | 2024 Proxy Statement | | | 19 | |
| Corporate Governance | |
| | Name | | | Required Multiple | | |
| | Chief Executive Officer | | | 3x | | |
| | All Other NEOs | | | 2x | | |
| | Directors | | | 5x | | |
| 20 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| | | 2024 Proxy Statement | | | 21 | |
| Corporate Governance | |
| 22 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| | | 2024 Proxy Statement | | | 23 | |
| Corporate Governance | |
| 24 | | | 2024 Proxy Statement | | | |
| Corporate Governance | |
| | | 2024 Proxy Statement | | | 25 | |
| | Name | | | Fees Earned or Paid in Cash ($)(1) | | | Stock Awards ($)(2)(3) | | | Total ($) | | | |||||||||
| | David Einhorn | | | | | 146,319 | | | | | | — | | | | | | 146,319 | | | |
| | Elizabeth K. Blake(4) | | | | | — | | | | | | 236,246 | | | | | | 236,246 | | | |
| | Harry Brandler(5) | | | | | 110,934 | | | | | | 137,196 | | | | | | 248,130 | | | |
| | Kathleen Olsen(6) | | | | | 107,033 | | | | | | 137,196 | | | | | | 244,229 | | | |
| | Lila Manassa Murphy(7) | | | | | 113,668 | | | | | | 137,136 | | | | | | 250,864 | | | |
| | Richard S. Press(8) | | | | | 135,467 | | | | | | 137,196 | | | | | | 272,663 | | | |
Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Total ($) | ||||||||||||||||||||
David Einhorn | 50,000 | — | 50,000 | ||||||||||||||||||||
Elizabeth K. Blake(3) | 6 | 172,188 | 172,194 | ||||||||||||||||||||
Harry Brandler | 62,007 | 95,656 | 157,663 | ||||||||||||||||||||
John R. Farris | 62,007 | 95,656 | 157,663 | ||||||||||||||||||||
Kathleen Olsen(4) | 82,007 | 95,656 | 177,663 | ||||||||||||||||||||
Richard S. Press(5) | 72,007 | 95,656 | 167,663 |
| 26 | | | 2024 Proxy Statement | | | |
| Director Compensation | |
Name | | | Restricted Stock | | |||
Elizabeth K. Blake | | | | | 6,018 | | |
Harry Brandler | | | | | 4,241 | | |
Kathleen Olsen | | | | | 4,241 | | |
Richard S. Press | | | | | 4,241 | | |
Lila Manassa Murphy | | | | | 4,241 | | |
| | | 2024 Proxy Statement | | | 27 | |
2020 | 2019 | |||||||||||||
Audit fees (1) | $ | 653,886 | $ | 759,839 | ||||||||||
Audit-related fees (2) | 65,000 | — | ||||||||||||
Tax fees | — | — | ||||||||||||
All other fees | — | — | ||||||||||||
Total fees | $ | 718,886 | $ | 759,839 | ||||||||||
| | Name | | | Age | | | Position | | |
| | James R. Brickman | | | 72 | | | Chief Executive Officer | | |
| | Richard A. Costello | | | 65 | | | Chief Financial Officer | | |
| | Jed Dolson | | | 46 | | | President and Chief Operating Officer | | |
| | Neal Suit | | | 48 | | | Executive Vice President, General Counsel, and Chief Risk and Compliance Officer | | |
| 28 | | | 2024 Proxy Statement | | | |
| | Name | | | Position | | |
| | James R. Brickman | | | Chief Executive Officer | | |
| | Richard A. Costello | | | Chief Financial Officer | | |
| | Jed Dolson | | | President and Chief Operating Officer | | |
| | Neal Suit | | | Executive Vice President, General Counsel, and Chief Risk and Compliance Officer | | |
| | Principles | | | Implementation | | |
| | Total direct compensation levels should be sufficiently competitive to attract, motivate and retain the highest quality executives | | | The Compensation Committee seeks to establish target total direct compensation (salary plus annual incentive), providing our executives the opportunity to be competitively rewarded for our financial and operational growth. Total direct compensation opportunity (i.e., maximum achievable compensation) should increase with position and responsibility. | | |
| | Performance-based and “at-risk” incentive compensation should constitute a substantial portion of total compensation | | | We seek to foster a pay-for-performance culture, with a significant portion of total direct compensation being performance-based and/or “at risk.” Accordingly, such portion should be tied to, and vary with, our financial, and operational performance, as well as individual performance. Executives with greater responsibilities and the ability to directly impact our strategic and operational goals and long-term results should bear a greater proportion of the risk if these goals and results are not achieved. Therefore, the more senior the executive, the greater the percentage of total compensation is in the form of performance-based compensation. | | |
| | Compensation programs should align executives’ interests with our stockholders’ interests to further the creation of long-term stockholder value | | | By awarding a portion of each year’s annual incentive payout in the form of stock, we encourage executives to focus on our long-term growth and prospects. This incentivizes our executives to manage our company from the perspective of owners with a meaningful stake and encourages them to remain with us for long and productive careers. Equity-based compensation also subjects our executives to market risk, a risk also borne by our stockholders. | | |
| | | 2024 Proxy Statement | | | 29 | |
| Compensation Discussion and Analysis | |
| | 2023 Metric | | | Why It Contributes to Alignment with Stockholder Value | | |
| | Homebuilding Gross Margin | | | Homebuilding Gross Margin is a metric most analysts and investors use to determine how effectively a builder is operating relative to peers. | | |
| | Home Closings Revenue Growth | | | Revenue Growth is a metric most analysts and investors use to determine how effectively a builder is operating relative to peers. | | |
| | Return on Assets | | | Return on Assets is a metric most analysts and investors use to determine how effectively a builder is operating relative to peers. | | |
| | Earnings Per Share (EPS) | | | EPS is a metric most analysts and investors use to determine how effectively a builder is operating relative to peers. | | |
| | Total Shareholder Return (TSR) | | | TSR is a metric most analysts and investors use to determine how effectively a builder is operating relative to peers. | | |
| 30 | | | 2024 Proxy Statement | | | |
| Compensation Discussion and Analysis | |
| | | |
| | | 2024 Proxy Statement | | | 31 | |
| Compensation Discussion and Analysis | |
| | Name | | | 2023 Base Salary | | | |||
| | James R. Brickman | | | | $ | 1,500,000 | | | |
| | Richard A. Costello | | | | $ | 450,000 | | | |
| | Jed Dolson(1) | | | | $ | 638,333 | | | |
| | Neal Suit | | | | $ | 300,000 | | | |
| 32 | | | 2024 Proxy Statement | | | |
| Compensation Discussion and Analysis | |
| | Name | | | 2023 Bonus Opportunity | | | |||
| | James R. Brickman | | | | $ | 3,300,000 | | | |
| | Richard A. Costello | | | | $ | 550,000 | | | |
| | Jed Dolson | | | | $ | 1,800,000 | | | |
| | Neal Suit | | | | $ | 450,000 | | | |
| | | 2024 Proxy Statement | | | 33 | |
| Compensation Discussion and Analysis | |
| 34 | | | 2024 Proxy Statement | | | |
| Compensation Discussion and Analysis | |
| | Builder | | | | Homebuilding Gross Margin % | | | | Home Closings Revenue Growth % | | | | Return on Assets (Annualized) | | | |||||||||
| | Green Brick Partners | | | | | | 30.9% | | | | | | | 4.2% | | | | | | | 15.8% | | | |
| | Beazer Homes | | | | | | 20.1% | | | | | | | -7.2% | | | | | | | 6.8% | | | |
| | Century Communities | | | | | | 21.2% | | | | | | | -18.0% | | | | | | | 6.6% | | | |
| | M/I Homes | | | | | | 23.5% | | | | | | | -2.4% | | | | | | | 12.0% | | | |
| | Hovnanian | | | | | | 19.7% | | | | | | | -7.4% | | | | | | | 7.7% | | | |
| | Tri Pointe Homes | | | | | | 22.3% | | | | | | | -14.9% | | | | | | | 7.1% | | | |
| | Lennar | | | | | | 23.3% | | | | | | | 2.1% | | | | | | | 10.2% | | | |
| | Toll Brothers, Inc. | | | | | | 26.9% | | | | | | | 1.6% | | | | | | | 11.1% | | | |
| | PulteGroup, Inc. | | | | | | 29.3% | | | | | | | 0.3% | | | | | | | 16.9% | | | |
| | | | | | Earnings Per Share ($) | | | | Earned % | | | |||
| | Maximum | | | | | $ | 4.00 | | | | | 200% | | |
| | Target | | | | | $ | 3.52 | | | | | 100% | | |
| | Threshold | | | | | $ | 3.00 | | | | | 50% | | |
| | ACTUAL | | | | | $ | 6.14 | | | | | | | |
| | | 2024 Proxy Statement | | | 35 | |
| Compensation Discussion and Analysis | |
| | TSR Peer Group | | | ||||||
| | Beazer Homes | | | Hovnanian | | | Toll Brothers, Inc. | | |
| | Century Communities | | | Tri Pointe Homes | | | PulteGroup, Inc. | | |
| | M/I Homes | | | Lennar | | | S&P 500 | | |
| | Metric | | | Weight | | | 2023 Results | | | Earned % | | |
| | TSR Trailing One-Year | | | 6.67% | | | 89 Percent | | | 200% | | |
| | TSR Trailing Three-Year | | | 6.67% | | | 56 Percent | | | 130% | | |
| | TSR Trailing Five-Year | | | 6.67% | | | 56 Percent | | | 130% | | |
| 36 | | | 2024 Proxy Statement | | | |
| Compensation Discussion and Analysis | |
| | NEO | | | Key Performance Highlights | | |
| | James R. Brickman Chief Executive Officer | | | • Decreased our debt to total capital ratio, effectively managing our financial risk • Oversaw plans for expansion; effectively managed relationships with key personnel at our controlled builders • Continued to build management bench | | |
| | Richard A. Costello Chief Financial Officer | | | • Successfully renegotiated credit facility and notes to provide additional flexibility for ancillary activities • Expanded relationships with sell-side analysts and increased presence at industry conferences • Continued roll-out of forecasting software | | |
| | Jed Dolson President and Chief Operating Officer | | | • Developed and led expansion of Trophy division into Austin • Supervised successful land acquisition strategy to position the Trophy division for expansion into Houston • Managed and established positive relationships between our NEOs and other employees and built a positive work environment. • Recruited and developed highly skilled members of senior management. | | |
| | Neal Suit Executive Vice President, General Counsel and Chief Risk and Compliance Officer | | | • Expanded risk management strategy and successfully managed litigation profile • Expanded captive insurance program, resulting in expense reductions for builders • Effectively collaborated with outside counsel, management and the Board to improve our corporate governance and legal and regulatory compliance. | | |
| | | 2024 Proxy Statement | | | 37 | |
| Compensation Discussion and Analysis | |
| | | | | Annual Incentive Bonus | | | |||||||||||||||
| | | | | Cash($) | | | Stock($) | | | Total($) | | | |||||||||
| | James R. Brickman | | | | | 3,146,000 | | | | | | 3,146,000 | | | | | | 6,292,000 | | | |
| | Richard A. Costello | | | | | 499,333 | | | | | | 499,333 | | | | | | 998,666 | | | |
| | Jed Dolson | | | | | 1,716,000 | | | | | | 1,716,000 | | | | | | 3,432,000 | | | |
| | Neal Suit | | | | | 450,000 | | | | | | 450,000 | | | | | | 900,000 | | | |
| 38 | | | 2024 Proxy Statement | | | |
| | | 2024 Proxy Statement | | | 39 | |
| | Name and Principal Position | | | Year | | | Salary ($) | | | Bonus ($) | | | Stock Awards ($)(2)(3) | | | Non-Equity Incentive Plan Compensation ($)(4) | | | All Other Compensation ($)(5) | | | Total ($) | | | |||||||||||||||||||||
| | James R. Brickman, Chief Executive Officer | | | | | 2023 | | | | | | 1,500,000 | | | | | | — | | | | | | 3,100,497 | | | | | | 3,146,000 | | | | | | 13,380 | | | | | | 7,759,877 | | | |
| | | 2022 | | | | | | 1,500,000 | | | | | | — | | | | | | 1,349,988 | | | | | | 3,100,500 | | | | | | 10,350 | | | | | | 5,960,838 | | | | ||||
| | | 2021 | | | | | | 1,500,000 | | | | | | 1,000,000 | | | | | | 1,225,000 | | | | | | 1,350,000 | | | | | | 12,182 | | | | | | 5,087,182 | | | | ||||
| | Richard A. Costello, Chief Financial Officer | | | | | 2023 | | | | | | 450,000 | | | | | | — | | | | | | 439,000 | | | | | | 499,333 | | | | | | 12,750 | | | | | | 1,401,083 | | | |
| | | 2022 | | | | | | 450,000 | | | | | | — | | | | | | 399,998 | | | | | | 439,000 | | | | | | 5,178 | | | | | | 1,294,176 | | | | ||||
| | | 2021 | | | | | | 447,900 | | | | | | 125,000 | | | | | | 262,500 | | | | | | 275,000 | | | | | | 8,700 | | | | | | 1,119,100 | | | | ||||
| | Jed Dolson, President, Chief Operating Officer | | | | | 2023 | | | | | | 638,333(1) | | | | | | — | | | | | | 1,558,468 | | | | | | 1,716,000 | | | | | | 17,355 | | | | | | 3,930,156 | | | |
| | | 2022 | | | | | | 600,000 | | | | | | — | | | | | | 1,152,997 | | | | | | 1,558,500 | | | | | | 20,550 | | | | | | 3,332,047 | | | | ||||
| | | 2021 | | | | | | 600,000 | | | | | | 400,000 | | | | | | 736,150 | | | | | | 753,000 | | | | | | 21,094 | | | | | | 2,510,244 | | | | ||||
| | Neal Suit, EVP, General Counsel | | | | | 2023 | | | | | | 300,000 | | | | | | — | | | | | | 344,954 | | | | | | 450,000 | | | | | | 13,214 | | | | | | 1,108,168 | | | |
| | | 2022 | | | | | | 279,166 | | | | | | 37,500 | | | | | | 20,013 | | | | | | 167,500 | | | | | | 8,925 | | | | | | 513,104 | | | |
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(4) | Non-Equity Incentive Plan Compensation ($)(5) | All Other Compensation ($)(6) | Total ($) | |||||||||||||||||||||||||||||||||||||
James R. Brickman, Chief Executive Officer | 2020 | 1,500,000 | 225,000 | (2) | 750,137 | (3) | 1,000,000 | 8,550 | 3,483,687 | |||||||||||||||||||||||||||||||||||
2019 | 1,416,667 | — | 700,000 | 750,137 | 10,400 | 2,877,204 | ||||||||||||||||||||||||||||||||||||||
Richard A. Costello, Chief Financial Officer | 2020 | 400,000 | 62,500 | (2) | 200,000 | (3) | 200,000 | 4,205 | 866,705 | |||||||||||||||||||||||||||||||||||
2019 | 400,000 | — | 160,000 | 200,000 | 9,400 | 769,400 | ||||||||||||||||||||||||||||||||||||||
Jed Dolson, Chief Operating Officer | 2020 | 559,103 | (1) | 150,000 | (2) | 650,000 | (3) | 586,151 | 20,718 | 1,965,972 | ||||||||||||||||||||||||||||||||||
2019 | 550,000 | 100,000 | 550,000 | 550,000 | 20,600 | 1,770,600 |
2020 Performance Based Compensation | ||||||||||||||||||||
Annual Incentive Bonus | Additional Bonus | |||||||||||||||||||
Name | Cash ($) | Stock ($) | Cash ($) | Stock ($) | Total ($) | |||||||||||||||
James R. Brickman | 1,000,000 | 1,000,000 | 225,000 | 225,000 | 2,450,000 | |||||||||||||||
Richard A. Costello | 200,000 | 200,000 | 62,500 | 62,500 | 525,000 | |||||||||||||||
Jed Dolson | 586,151 | 586,151 | 150,000 | 150,000 | 1,472,302 |
| | | Annual Incentive Bonus | | | Total ($) | | ||||||||||||
| | | Cash ($) | | | Stock ($) | | | | | | | | ||||||
James R. Brickman | | | | | 3,146,000 | | | | | | 3,146,000 | | | | | | 6,292,000 | | |
Richard A. Costello | | | | | 499,333 | | | | | | 499,333 | | | | | | 998,666 | | |
Jed Dolson | | | | | 1,716,000 | | | | | | 1,716,000 | | | | | | 3,432,000 | | |
Neal Suit | | | | | 450,000 | | | | | | 450,000 | | | | | | 900,000 | | |
All Other Compensation | |||||||||||||||||
Name | 401(k) Employer Match ($) | Car and Cell Phone Allowance ($) | Gym Membership ($) | Total ($) | |||||||||||||
James R. Brickman | 8,550 | — | — | 8,550 | |||||||||||||
Richard A. Costello | 4,205 | — | — | 4,205 | |||||||||||||
Jed Dolson | 8,550 | 10,200 | 1,968 | 20,718 |
| 40 | | | 2024 Proxy Statement | |
| |
| | | | | Grant Date | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | | | All other stock awards: Number of shares of stock (#)(2) | | | Grant date fair value of stock awards(2) | | | ||||||||||||||||||||||||
| | | | | Threshold ($) | | | Target ($) | | | Maximum ($) | | ||||||||||||||||||||||||||||
| | James R. Brickman | | | | | 03/27/2023 | | | | | $ | 1,650,000 | | | | | $ | 3,300,000 | | | | | $ | 6,600,000 | | | | | | — | | | | | | — | | | |
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 93,926 | | | | | $ | 3,100,497 | | | | ||||
| | Richard A. Costello | | | | | 03/27/2023 | | | | | $ | 275,000 | | | | | $ | 550,000 | | | | | $ | 1,100,000 | | | | | | — | | | | | | — | | | |
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 13,299 | | | | | $ | 439,000 | | | | ||||
| | Jed Dolson | | | | | 03/27/2023 | | | | | $ | 900,000 | | | | | $ | 1,800,000 | | | | | $ | 3,600,000 | | | | | | — | | | | | | — | | | |
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 47,212 | | | | | $ | 1,558,468 | | | | ||||
| | Neal Suit | | | | | 03/27/2023 | | | | | $ | 225,000 | | | | | $ | 450,000 | | | | | $ | 900,000 | | | | | | — | | | | | | — | | | |
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 6,210 | | | | | $ | 204,992 | | | | ||||
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 1,211(3) | | | | | $ | 39,975 | | | | ||||
| | | 03/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | 3,029(3) | | | | | $ | 99,987 | | | |
| | | 2024 Proxy Statement | | | 41 | |
| Executive Compensation | |
| | | | | Option Awards | | | Stock Awards | | | ||||||||||||||||||||||||||||||
| | Named Executive Officers | | | Number of Securities Underlying Unexercised Options Exercisable (#) | | | Option Exercise Price ($/Share) | | | Option Expiration Date | | | Award Type | | | Unearned Shares, Units or Other Rights that have not vested (#) | | | Market Value of Shares or Units of Stock that have not Vested ($)(2) | | | ||||||||||||||||||
| | James R. Brickman | | | | | 500,000(1) | | | | | $ | 7.4861 | | | | | | 10/27/24 | | | | | | — | | | | | | | | | | | | | | | |
| | Richard A. Costello | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | | | | |
| | Jed Dolson | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | | | | |
| | Neal Suit | | | | | — | | | | | | — | | | | | | — | | | | | | RSA | | | | | | 1,211 | | | | | | 62,899 | | | |
| | | | | | | — | | | | | | — | | | | | | — | | | | | | RSA | | | | | | 3,029 | | | | | | 157,326 | | | |
| 42 | | | 2024 Proxy Statement | | | |
| Executive Compensation | |
| | | | | James R. Brickman | | | Richard A. Costello | | | Jed Dolson | | | Neal Suit | | |
| | Termination by the Company without Cause/Resignation by Executive for Good Reason | | | • A cash severance payment equal to $9,600,000, calculated as two times (2x) the sum of (i) base salary ($1,500,000) plus (ii) target bonus for year of termination ($3,300,000). | | | • A cash severance payment equal to $1,100,000, calculated as the sum of (i) base salary ($550,000) plus (ii) target bonus for year of termination ($550,000). | | | • A cash severance payment equal to $5,875,500, calculated as one and one-half times (1.5x) the sum (i) base salary ($800,000) plus (ii) bonus in respect of prior year ($3,117,000). | | | • A cash severance payment equal to $1,125,000, calculated as one and one-half times (1.5x) the sum (i) base salary ($300,000) plus (ii) target bonus for year of termination ($450,000). | | |
| | Termination by the Company without Cause/Resignation by Executive for Good Reason following a Change in Control | | | • A cash severance payment equal to $14,400,000, calculated as three times (3x) the sum (i) base salary ($1,500,000) plus (ii) target bonus for year of termination ($3,300,000). | | | A cash severance payment equal to $1,350,000, calculated as the sum of (i) base salary ($550,000) plus (ii) target bonus for year of termination ($550,000), plus (iii) $250,000. | | | Same as above | | | Same as above | | |
| | | 2024 Proxy Statement | | | 43 | |
| Executive Compensation | |
| 44 | | | 2024 Proxy Statement | | | |
| | | 2024 Proxy Statement | | | 45 | |
| | Year | | | Summary Compensation Table Total for PEO | | | Compensation Actually Paid to PEO | | | Average Summary Compensation Table Total for Non-PEO NEOs | | | Average Compensation Actually Paid to Non-PEO NEOs | | | Value of Initial Fixed $100 Investment Based On: | | | Net Income (in thousands) | | | Home Closings Revenue (in thousands) | | | |||||||||||||||||||||||||||
| Total Shareholder Return | | | Peer Group Total Shareholder Return | | |||||||||||||||||||||||||||||||||||||||||||||||
| | (a) | | | (b) | | | (c) | | | (d) | | | (e) | | | (f) | | | (g) | | | (h) | | | (i) | | | ||||||||||||||||||||||||
| | 2023 | | | | $ | 7,759,877 | | | | | $ | 7,759,877 | | | | | $ | 2,146,469 | | | | | $ | 2,181,195 | | | | | $ | 452.44 | | | | | $ | 220.06 | | | | | $ | 306,675 | | | | | $ | 1,767,788 | | | |
| | 2022 | | | | $ | 5,960,838 | | | | | $ | 5,960,838 | | | | | $ | 1,538,111 | | | | | $ | 1,538,410 | | | | | $ | 211.06 | | | | | $ | 136.96 | | | | | $ | 313,997 | | | | | $ | 1,696,911 | | | |
| | 2021 | | | | $ | 5,087,182 | | | | | $ | 5,087,182 | | | | | $ | 1,814,672 | | | | | $ | 1,814,672 | | | | | $ | 264.20 | | | | | $ | 192.00 | | | | | $ | 204,381 | | | | | $ | 1,305,620 | | | |
| | 2020 | | | | $ | 3,483,687 | | | | | $ | 3,483,687 | | | | | $ | 1,416,339 | | | | | $ | 1,416,339 | | | | | $ | 200.00 | | | | | $ | 127.81 | | | | | $ | 117,797 | | | | | $ | 923,901 | | | |
| | Year | | | 2020 | | | 2021 | | | 2022 | | | 2023 | | | ||||||||||||
| | PEO | | | Mr. Brickman | | | Mr. Brickman | | | Mr. Brickman | | | Mr. Brickman | | | ||||||||||||
| | SCT Total Compensation ($) | | | | $ | 3,483,687 | | | | | $ | 5,087,182 | | | | | $ | 5,960,838 | | | | | $ | 7,759,877 | | | |
| | Less: Stock and Option Award Values Reported in SCT for the Covered Year on Grant Date ($) | | | | $ | 750,137 | | | | | $ | 1,225,000 | | | | | $ | 1,349,988 | | | | | $ | 3,100,497 | | | |
| | Plus: Fair Value of Stock Awards Granted and Vested in the Covered Year (on Vest Date) | | | | $ | 750,137 | | | | | $ | 1,225,000 | | | | | $ | 1,349,988 | | | | | $ | 3,100,497 | | | |
| | Fair Value for Stock and Option Awards Granted in the Covered Year at Year-End ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Change in Fair Value of Outstanding Unvested Stock and Option Awards from Prior Years ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Change in Fair Value of Stock and Option Awards from Prior Years that Vested in the Covered Year ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Less: Fair Value of Stock and Option Awards Forfeited during the Covered Year ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Compensation Actually Paid ($) | | | | $ | 3,483,687 | | | | | $ | 5,087,182 | | | | | $ | 5,960,838 | | | | | $ | 7,759,877 | | | |
| 46 | | | 2024 Proxy Statement | | | |
| Pay Versus Performance | |
| | Year | | | 2020 | | | 2021 | | | 2022 | | | 2023 | | | ||||||||||||
| | Non-PEO NEOs | | | See column (d) note | | | See column (d) note | | | See column (d) note | | | See column (d) note | | | ||||||||||||
| | SCT Total Compensation ($) | | | $1,416,339 | | | $1,814,672 | | | $1,538,111 | | | $2,146,469 | | | ||||||||||||
| | Less: Stock and Option Award Values Reported in SCT for the Covered Year ($) | | | | $ | 425,000 | | | | | $ | 499,325 | | | | | $ | 524,336 | | | | | $ | 780,807 | | | |
| | Plus: Fair Value of Stock Awards Granted and Vested in the Covered Year (on Vest Date) | | | | $ | 425,000 | | | | | $ | 499,325 | | | | | $ | 524,336 | | | | | $ | 734,153 | | | |
| | Fair Value for Stock and Option Awards Granted in the Covered Year at Year-End ($) | | | | | — | | | | | | — | | | | | $ | 299 | | | | | $ | 73,409 | | | |
| | Change in Fair Value of Outstanding Unvested Stock and Option Awards from Prior Years ($) | | | | | — | | | | | | — | | | | | | — | | | | | $ | 7,971 | | | |
| | Change in Fair Value of Stock and Option Awards from Prior Years that Vested in the Covered Year ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Less: Fair Value of Stock and Option Awards Forfeited during the Covered Year ($) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | |
| | Compensation Actually Paid ($) | | | | $ | 1,416,339 | | | | | $ | 1,814,672 | | | | | $ | 1,538,410 | | | | | $ | 2,181,195 | | | |
| | | 2024 Proxy Statement | | | 47 | |
| Pay Versus Performance | |
| | Measure | | | Nature | | | Explanation | | |
| | Earnings Per Share | | | Financial measure | | | Metric of profitability on a per share basis, which includes the effect of all dilutive securities. | | |
| | Home Closings Revenue Growth | | | Financial measure | | | Increase, period over period, in revenue from home closings. | | |
| | Homebuilding Gross Margin | | | Financial measure | | | Homebuilding gross margin is calculated as Home Closings Revenue minus Cost of Homebuilding units. | | |
| | Return on Assets | | | Financial measure | | | Return on assets is calculated by dividing net income by total assets. | | |
| 48 | | | 2024 Proxy Statement | | | |
| PROPOSAL NO. 2 RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANT | |
| The Audit Committee appoints, compensates, retains and oversees our auditors. The Committee engages in an annual evaluation of the independent registered certified public accounting firm, or “independent auditor,” qualifications, performance and independence and considers the advisability and potential impact of selecting a different independent registered certified public accounting firm. The Audit Committee has selected RSM US LLP to serve as our independent auditor for 2024. RSM has served as our independent registered public accounting firm since August 2016. | |
| THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF RSM AS GREEN BRICK’S INDEPENDENT PUBLIC ACCOUNTANT | |
| | | 2024 Proxy Statement | | | 49 | |
| Proposal No. 2 – Ratification of Independent Public Accountant | |
| | Services Provided | | | 2023 | | | 2022 | | | ||||||
| | Audit Fees(1) | | | | $ | 876,928 | | | | | $ | 790,400 | | | |
| | Audit-Related Fees(2) | | | | | 49,400 | | | | | | — | | | |
| | Tax Fees | | | | | — | | | | | | — | | | |
| | All Other Fees(3) | | | | | 19,703 | | | | | | 13,874 | | | |
| | Total | | | | $ | 946,031 | | | | | $ | 804,274 | | | |
| 50 | | | 2024 Proxy Statement | | | |
| | | 2024 Proxy Statement | | | 51 | |
| PROPOSAL NO. 3 APPROVAL OF THE 2024 OMNIBUS INCENTIVE PLAN | |
| | |
| THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE 2024 OMNIBUS INCENTIVE PLAN | |
| 52 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||||||||||||||
Equity compensation plans approved by security holders | 500,000 | $ | 7.4861 | 1,482,794 | ||||||||||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||||||||||
Total | 500,000 | $ | 7.4861 | 1,482,794 |
(Share amounts in thousands) | | | 2023 | | | 2022 | | | 2021 | | | | | |||||||||
Stock/RSA Awards Granted | | | | | 183 | | | | | | 157 | | | | | | 139 | | | | | |
PBRSAs Granted | | | | | — | | | | | | 31 | | | | | | 14 | | | | | |
PBRSUs Granted | | | | | 34 | | | | | | — | | | | | | — | | | | | |
Weighted average common stock outstanding during fiscal year | | | | | 45,446 | | | | | | 47,648 | | | | | | 50,700 | | | | 3-year avg. | |
Burn Rate | | | | | 0.5% | | | | | | 0.4% | | | | | | 0.3% | | | | 0.4% | |
| | | 2024 Proxy Statement | | | 53 | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| | | Assuming Approval of the 2024 Plan | | |||
Restricted Stock Awards Outstanding | | | | | 24,634 | | |
Performance Based Restricted Stock Awards(1) | | | | | 24,069 | | |
Performance Based Restricted Stock Units Outstanding (at maximum) | | | | | 66,218 | | |
Stock Options Outstanding(2) | | | | | 500,000 | | |
Total Equity Awards Outstanding | | | | | 614,921 | | |
Common Stock Outstanding | | | | | 45,025,151 | | |
Dilution(3) | | | | | 1.4% | | |
Shares available for grant under the 2014 Plan (will carryover to 2024 Plan) | | | | | 863,554 | | |
Shares available for future grant under the 2024 Plan (not including carryover shares) | | | | | 2,750,000 | | |
Overhang, as a percentage of Common Stock outstanding(4) | | | | | 9.4% | | |
| 54 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| | | 2024 Proxy Statement | | | 55 | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| Term | | | | Description | |
| Plan Term | | | | If approved by our shareholders at the Annual Meeting, the 2024 Plan will expire on June 11, 2034. However, the 2024 Plan may be terminated earlier by the Board. | |
| Eligibility for Grants | | | | Persons eligible to receive awards under the 2024 Plan include officers or employees of Green Brick or any of our subsidiaries or affiliates, directors of Green Brick or one of its subsidiaries, and certain consultants and advisors to Green Brick or any of our subsidiaries or affiliates. The Compensation Committee may select such eligible individuals to participate in the 2024 Plan. As of March 31, 2024, there were approximately 604 employees (including all of our named executive officers), 6 non-employee directors and zero consultants and advisors eligible to receive awards under the 2024 Plan. | |
| Awards Available | | | | The 2024 Plan authorizes awards in stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonuses and other forms of awards granted or denominated in our Common Stock or units of our Common Stock, as well as performance-based awards, which may be denominated in cash or stock. The 2024 Plan retains flexibility to offer competitive incentives and to tailor benefits to specific needs and circumstances. Any award may be paid or settled in cash. Options. A stock option is the right to purchase shares of our Common Stock at a future date at a specified price per share, or the exercise price. The per share exercise price of an option generally may not be less than the fair market value of a share of our Common Stock on the date of grant. On March 31, 2024, the fair market value of the Common Stock based on the last sale price for the day was $60.23. The maximum term of an option is ten years from the date of grant. An option may either be an incentive stock option or a non-qualified stock option. Incentive stock option benefits are taxed differently from non-qualified stock options, as described under “U.S. Federal Income Tax Consequences of Stock Options” below. Incentive stock options are also subject to more restrictive terms and are limited in amount by the U.S. Internal Revenue Code (the “Code”) and the 2024 Plan. Incentive stock options may only be granted to employees of Green Brick or one of our subsidiaries. | |
| 56 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| Term | | | | Description | |
| | | | | Stock Appreciation Rights. A stock appreciation right is the right to receive payment of an amount equal to the excess of the fair market value of our Common Stock on the date of exercise of the stock appreciation right over the base price of the stock appreciation right. The base price will be established by the Compensation Committee at the time of grant of the stock appreciation right and generally cannot be less than the fair market value of a share of our Common Stock on the date of grant. Stock appreciation rights may be granted in connection with other awards or independently. The maximum term of a stock appreciation right is ten years from the date of grant. Restricted Stock. Shares of restricted stock are shares of our Common Stock that are subject to certain restrictions on sale, pledge, or other transfer by the recipient during a particular period of time (the “restricted period”). Subject to the restrictions provided in the applicable award agreement and the 2024 Plan, a participant receiving restricted stock may have all of the rights of a shareholder as to such shares, including the right to receive dividends. Restricted Stock Units. A restricted stock unit, or RSU, represents the right to receive one share of our Common Stock on a specific future vesting or payment date. Subject to the restrictions provided in the applicable award agreement and the 2024 Plan, a participant receiving RSUs has no shareholder rights until shares of Common Stock are issued to the participant. RSUs may be granted with dividend equivalent rights. Performance Awards. The 2024 Plan has been designed to permit the Compensation Committee to grant performance-based awards that are earned subject to the achievement of set performance goals or criteria. A performance award may consist of a right that is (1) denominated in cash or shares (including but not limited to restricted stock or restricted stock units), (2) valued, as determined by the Compensation Committee, in accordance with the achievement of one or more performance criteria as the Compensation Committee will establish, which criteria may be based on financial or operational performance and/or performance evaluations, and (3) payable at such time and in such form as the Compensation Committee will determine. Other Stock Based Awards. The other types of awards that may be granted under the 2024 Plan include, without limitation, awards of shares of Common Stock, phantom stock and other awards that are valued in whole or in part by reference to, or otherwise based on, Common Stock. Such awards may be made alone or in addition to or in connection with any option, restricted stock unit or any other award granted under the 2024 Plan. The Compensation Committee may determine the terms and conditions of any such award. | |
| | | 2024 Proxy Statement | | | 57 | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| Term | | | | Description | |
| Shares Authorized | | | | The number of shares of our Common Stock that will be available for issuance under the 2024 Plan will be equal to the sum of (a) 2,750,000 shares of Common Stock plus (b) any shares of Common Stock remaining available for future awards under the 2014 Plan on the date the 2024 Plan is approved by the Company’s shareholders (of which there were 863,554 shares of Common Stock remaining available for future awards under the 2014 Plan as of March 31, 2024) plus (c) any shares of Common Stock with respect to awards that were granted under the 2014 Plan that are forfeited or canceled after the 2024 Plan is approved by the Company’s shareholders. These shares may be either shares reacquired by Green Brick, including shares purchased in the open market, or authorized but unissued shares. Authorized shares are counted and subject to adjustments, as described below. | |
| Share Counting Method | | | | • The shares underlying all awards under the 2024 Plan count against the number of shares authorized on a one-for-one basis. • The following shares shall not be added to the number of shares authorized with respect to awards under the 2024 Plan or prior awards under the 2014 Plan: shares tendered to or withheld in payment of the exercise price of an option; shares tendered or withheld to satisfy tax withholding obligations; shares subject to stock appreciation rights that are not issued in connection with its stock settlement on exercise thereof; and shares repurchased by Green Brick on the open market using the proceeds of an award paid to Green Brick. • All shares covered by a stock-settled stock appreciation right are counted against the number of shares authorized, not just the net shares issued upon exercise. • Shares subject to an award under the 2024 Plan or a prior award under the 2014 Plan that is forfeited or otherwise expires or is terminated without the delivery of shares, and shares not issued under an award that is settled in cash, may be used for further awards under the 2024 Plan on a one-for-one basis. | |
| Repricing Prohibited | | | | Unless approved by our shareholders or otherwise specifically provided under the 2024 Plan, Green Brick may not, with respect to any outstanding option or stock appreciation right granted, take any of the following actions: • amend the option or stock appreciation right to lower the exercise price per share; • cancel the option or stock appreciation right and re-grant a substituted award having a lower exercise price per share; • conduct a cash buyout of any options or stock appreciation rights that have exercise prices per share above the then-current fair market value (i.e., underwater); • replace an underwater option or stock appreciation right with another award; or • take any other action that constitutes “repricing” under GAAP. | |
| 58 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| Term | | | | Description | |
| Special Provisions for Options | | | | | |
| Exercise Price | | | | Not less than 100% fair market value of a share of Common Stock on grant date (other than in the case of substitute awards). To the extent provided in the applicable award agreement, the exercise price may be paid (1) in cash, (2) with shares owned by the participant, (3) through a cashless exercise or net settlement procedure or (4) with such other consideration permitted by law. The fair market value is closing price of our Common Stock as reported on the New York Stock Exchange on the trading day immediately preceding the grant date. | |
| Vesting and Exercise Periods | | | | As determined by the Compensation Committee. However, the term of options generally may not exceed ten years, except at the discretion of the Compensation Committee for a limited period (not more than 30 days) following the lifting of a black-out period. | |
| Limits on Incentive Stock Options (ISOs) | | | | The maximum number of shares of Common Stock that may be granted in the form of ISOs is 2,000,000 shares. In general, ISOs must satisfy requirements prescribed by the Code to qualify for special tax treatment. Therefore, among other requirements: • No employee may receive a grant of ISOs for Common Stock that would have an aggregate fair market value in excess of $100,000, determined when the ISO is granted, that would be exercisable for the first time during any calendar year. • If any grant is made in excess of the limits provided in the Code, the portion of such Option which is in excess of the $100,000 limitation, and any Options issued subsequently in the same calendar year, shall be treated as a Non-qualified Stock Option. | |
| Dividends/Dividend Equivalents | | | | Dividends and dividend equivalents may not be paid on options. | |
| Special Provisions for Stock Appreciation Rights (SARs) | | | | Upon exercise of a SAR, the holder of the SAR will receive an amount equal to the excess, if any, of the fair market value of the shares on the date designated by the holder, over the exercise price (in the case of a SAR granted in tandem with an option) or the fair market value of the shares on the grant date (in the case of a standalone SAR) multiplied by the number of shares covered by the grant of the SAR. | |
| Dividends and Dividend Equivalents | | | | Dividends and dividend equivalents may not be paid on SARs. | |
| Vesting and Exercise Periods | | | | As determined by the Compensation Committee. However, the term of SARs generally may not exceed ten years, except at the discretion of the Compensation Committee for a limited period (not more than 30 days) following the lifting of a black-out period. | |
| | | 2024 Proxy Statement | | | 59 | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| Term | | | | Description | |
| Special Provisions for Restricted Stock Awards and Restricted Stock Unit Awards | | | | | |
| Vesting and Exercise Periods | | | | The Compensation Committee will establish an issue date and a vesting date. The Compensation Committee may impose restrictions or conditions to the vesting of restricted stock as it deems appropriate. | |
| Dividends and Dividend Equivalents | | | | The Compensation Committee may provide that restricted stock unit awards accrue dividend equivalents, with payment in each case subject to the vesting of the underlying awards. Notwithstanding any other provision of the 2024 Plan to the contrary, with respect to any restricted stock award or restricted stock unit award that provides for or includes a right to dividends or dividend equivalents, if dividends are declared during the period that such restricted stock award or restricted stock unit award is outstanding, such dividends or dividend equivalents shall not be paid to a participant unless and until the restricted stock award or restricted stock unit award to which they relate has vested. | |
| Special Provisions for Performance Awards | | | | | |
| Performance Goals | | | | The Compensation Committee will establish performance goals or criteria for performance awards, which may be based on Green Brick’s financial or operational performance and/or personal performance evaluations of the participant. The Compensation Committee has the discretion to provide for the manner in which performance will be measured against the performance criteria. | |
| Performance Share Award Payouts | | | | The Compensation Committee will establish the method of calculating the amount of payment to be made under a performance award if performance goals are met, including any maximum payment. After the completion of an award performance period, the relevant performance will be measured against the performance goals or criteria, and the Compensation Committee will determine whether all, none or a portion of the performance award is paid. The Compensation Committee may elect to make payment in shares, cash or a combination of cash and shares. | |
| Dividends/Dividend Equivalents | | | | The Compensation Committee may at the time of the award provide for dividend or dividend equivalent rights on performance awards, provided that the actual payment of such dividends or dividend equivalents shall be conditioned upon the performance goals underlying the performance award being met. In no event will dividends or dividend equivalents be paid on unearned performance awards. | |
| 60 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| | | 2024 Proxy Statement | | | 61 | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| 62 | | | 2024 Proxy Statement | | | |
| Proposal No. 3 – Approval of the 2024 Omnibus Incentive Plan | |
| | | Equity Compensation Plan Information As of December 31, 2023 | | |||||||||||||||
| | | (in thousands, except exercise price) | | |||||||||||||||
| | | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights | | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in first column (a)) | | |||||||||
| | | (a) | | | (b) | | | (c) | | |||||||||
Equity compensation plans approved by security holders | | | | | | | | | | | | | | | | | | | |
2014 Plan | | | | | 591,971(1) | | | | | $ | 7.49 | | | | | | 442,485 | | |
Equity compensation plans not approved by security holders | | | | | — | | | | | | | | | | | | — | | |
Total | | | | | 591,971 | | | | | $ | 7.49 | | | | | | 442,485 | | |
| | | 2024 Proxy Statement | | | 63 | |
Name of Beneficial Owner | | | Number of Shares of Common Stock Beneficially Owned(1) | | | Percent | | ||||||
Holders of more than 5% | | | | | | | | | | | | | |
Greenlight Capital Inc. and its affiliates(2) | | | | | 10,467,383 | | | | | | 23.3% | | |
BlackRock, Inc.(3) | | | | | 4,148,332 | | | | | | 9.2% | | |
Vanguard Group.(4) | | | | | 2,403,836 | | | | | | 5.3% | | |
Named Executive Officers and Directors | | | | | | | | | | | | | |
James R. Brickman(5) | | | | | 2,153,472 | | | | | | 4.7% | | |
Richard A. Costello | | | | | 92,116 | | | | | | * | | |
Jed Dolson | | | | | 269,978 | | | | | | * | | |
Neal Suit | | | | | 14,228 | | | | | | * | | |
David Einhorn(6) | | | | | 11,336,493 | | | | | | 25.2% | | |
Elizabeth K. Blake | | | | | 176,099 | | | | | | * | | |
Harry Brandler(7) | | | | | 110,250 | | | | | | * | | |
Lila Manassa Murphy | | | | | 13,896 | | | | | | * | | |
Kathleen Olsen | | | | | 73,224 | | | | | | * | | |
Richard S. Press(8) | | | | | 88,090 | | | | | | * | | |
All Executive Officers and Directors as a group (10 persons)(9) | | | | | 14,327,846 | | | | | | 31.5% | | |
Beneficial Owner | Total Number of Shares Beneficially Owned | Percentage of Common Stock Outstanding | |||||||||||||||
James R. Brickman (1) | 2,019,317 | 3.9 | % | ||||||||||||||
Richard A. Costello | 76,779 | * | |||||||||||||||
Jed Dolson | 207,992 | * | |||||||||||||||
David Einhorn (2) | 17,427,590 | 34.4 | % | ||||||||||||||
Elizabeth K. Blake | 172,132 | * | |||||||||||||||
Harry Brandler (3) | 66,834 | * | |||||||||||||||
John R. Farris | 136,628 | * | |||||||||||||||
Kathleen Olsen | 64,922 | * | |||||||||||||||
Richard S. Press | 96,281 | * | |||||||||||||||
All Directors and Executive Officers as a group, 9 persons (4) | 20,268,475 | 39.6 | % | ||||||||||||||
Greenlight Capital Inc. and its affiliates (2) | 17,427,590 | 34.4 | % | ||||||||||||||
BlackRock, Inc. (5) | 3,120,097 | 6.2 | % |
| 64 | | | 2024 Proxy Statement | | | |
| Security Ownership | |
| | | 2024 Proxy Statement | | | 65 | |
| | Proposal | | | Board Recommendation | | |
| | To elect seven directors each for a term expiring at the next annual meeting or until his or her successor has been duly elected and qualified | | | FOR each Director Nominee | | |
| | To ratify the appointment of RSM US LLP as our independent registered public accounting firm for the 2024 fiscal year | | | FOR | | |
| | To approve the 2024 Omnibus Incentive Plan | | | FOR | | |
| 66 | | | 2024 Proxy Statement | | | |
| Questions and Answers About Our Annual Meeting | |
| |||||||||||
| Proposal | | | Can Brokers Vote Absent Instructions? | | ||||||
| Election of Directors | | | No | | ||||||
| Ratification of | | | Yes | | ||||||
| | Approval of 2024 Omnibus Incentive Plan | | | No | | |
| | | 2024 Proxy Statement | | | 67 | |
| Questions and Answers About Our Annual Meeting | |
| | Proposal | | | Description of Votes Needed | | |
| | Election of Directors | | | The seven nominees for election as directors will be elected by a majority of the votes cast at the Annual Meeting. | | |
| | Ratification of Independent Registered Certified Public Accounting Firm | | | The affirmative vote of a majority of the votes cast on the proposal is required for the ratification of the appointment of RSM US as our independent auditor for the 2024 fiscal year. | | |
| | Approval of 2024 Omnibus Incentive Plan | | | The affirmative vote of a majority of the votes cast on the proposal is required for approval of the 2024 Omnibus Incentive Plan | | |
| 68 | | | 2024 Proxy Statement | | | |
| Questions and Answers About Our Annual Meeting | |
| | Proposal | | | Board Recommendation | | |
| | Election of Directors | | | FOR each Director Nominee | | |
| | Ratification of Independent Registered Certified Public Accounting Firm | | | FOR | | |
| | Approval of 2024 Omnibus Incentive Plan | | | FOR | | |
| | | 2024 Proxy Statement | | | 69 | |
| 70 | | | 2024 Proxy Statement | | | |
| Other Matters | |
| | | 2024 Proxy Statement | | | 71 | |
| Other Matters | |
| 72 | | | 2024 Proxy Statement | | | |
| | | 2024 Proxy Statement | | | A-1 | |
| Appendix A | |
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| | | 2024 Proxy Statement | | | A-21 | |
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| | | 2024 Proxy Statement | | | A-23 | |