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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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Invesco Mortgage Capital Inc.
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Notice of 2018 Annual Meeting of Stockholders Proxy Statement Your vote is important Please vote by using the Internet, the telephone or by signing, dating and returning a proxy card
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A Letter to Our Stockholders | ||
Dear Fellow Stockholder: | ||
Our financial results For detailed information regarding our financial results, see our 2017 Annual Report on Form10-K available at www. invescomortgagecapital.com. | During 2017, our company‘s diversified strategy continued to deliver strong economic returns. We increased our common stock dividend twice during 2017 and continue to be confident in the strength of the credit profile of our portfolio.
All members of the Board are aware that we are charged with serving the collective interests of you, the stockholders, and that we serve at your pleasure. I would like to take this opportunity to highlight below a few of the many areas in which the Board focused its attention in 2017. | |
We are committed to strong governance. For more information regarding our corporate governance practices, seeCorporate Governance beginning on page 8. | Board Composition and Effectiveness.The Board remains committed to ensuring that it is composed of a highly capable group of directors who are well-equipped to oversee the success of the company and effectively represent the interests of our stockholders. This year, we added three new members to the Board, Carolyn Handlon, Dennis Lockhart, and Colin Meadows, as both our former Chair of the Board, Jim Balloun, and our long-time director, Karen Dunn Kelley, retired from the Board. The addition of these directors has provided the Board with new qualifications and perspectives and has also increased our diversity. I was honored to assume the role of Chair of the Board last August as Mr. Balloun prepared for his retirement in November. We encourage you to review the qualifications, skills and experience that we have identified as important attributes for directors of our company and how they match up to each of our directors. | |
Each year the Board, with the assistance of an external advisor specializing in corporate governance, conducts an evaluation of the performance of our Board and each of its committees. Directors participate inone-on-one confidential interviews with the advisor and the Board as a group receivesin-person feedback from the advisor based on those interviews. This information assists the Board in assessing how it can continue to improve its performance. | ||
We are externally managedand our executive officersare compensated byour manager.For more information regarding our manager’s executive compensation programs, seeCompensationDiscussion and Analysis beginning on page 18. | Executive Compensation and Our Management Agreement.We pay a fee to our external manager to manage your company; we have no direct employees. Our manager, in turn, manages and determines compensation of its employees, including our executive officers. Our manager does, however, consult with your Board in an annual discussion of the philosophy, process, and structure of compensation. Accordingly, your board has the opportunity to understand the compensation of its executives and satisfy ourselves that they are not inconsistent with stockholder interests.
In addition, each year the Board’s independent directors engage in a review of the management agreement with our manager in the context of a review of peer company management fees. The Board is focused on ensuring that the management fee remains appropriate andin-line with market practices. |
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We are committed tostockholder engagement. For more information on how to communicate with our Board, seeImportantAdditional Information beginning on page 35. | Stockholder Engagement and Communicating with the Board.As we conduct the activities of the Board, a key priority is ensuring robust engagement with you, the owners of the Company. Please continue to share your thoughts with us on any topic as we value your input, investment and support. The Board has established a process to facilitate communication by stockholders with Board members. Communications can be addressed to the Board of Directors in care of the Office of the Secretary, Invesco Mortgage Capital Inc., 1555 Peachtree Street NE, Atlanta, Georgia 30309 or bye-mail to company.secretary@invescomortgagecapital.com.
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Proxy statementsummary For a convenient overview of the matters to be voted on at our Annual Meeting, seeProxy StatementSummarybeginning on page 1. | Annual Meeting Invitation.You are cordially invited to attend the 2018 Annual Meeting of Stockholders of Invesco Mortgage Capital, which will be held on Wednesday, May 2, 2018, at 2:00 p.m., Eastern Time, at Invesco’s Global Headquarters, located at 1555 Peachtree Street N.E., Atlanta, Georgia 30309.
Your vote is important and we encourage you to vote promptly.Whether or not you are able to attend the meeting in person, please follow the instructions contained in the Notice of Internet Availability of Proxy Materials (“Notice”) on how to vote via the Internet or via the toll-free telephone number, or request a paper proxy card to complete, sign and return by mail so that your shares may be voted.
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On behalf of the Board of Directors, I extend our appreciation for your continued support.
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Sincerely,
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Edward J. Hardin | ||
Chairperson |
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Notice of 2018 Annual Meeting of Stockholders | ||||
To our Stockholders: | ||||
The 2018 Annual Meeting of Stockholders of Invesco Mortgage Capital Inc. will be held at the following location and for the following purpose: | ||||
When | Wednesday, May 2, 2018, at 2:00 p.m., Eastern Time | |||
Where | 1555 Peachtree Street N.E. | |||
Atlanta, Georgia 30309 | ||||
Items of business | 1 | To elect seven (7) directors to the Board of Directors to hold office until the annual meeting of stockholders in 2019; | ||
2 | To hold an advisory vote to approve the company’s executive compensation; | |||
3 | To appoint PricewaterhouseCoopers LLP as the company’s independent registered public accounting firm for the fiscal year ending December 31, 2018; and | |||
4 | To consider and act upon such other business as may properly come before the meeting or any adjournment thereof. | |||
Who can vote | Only holders of record of our common stock on March 5, 2018 are entitled to notice of and to attend and vote at the Annual Meeting and any adjournment or postponement thereof. |
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Review your Proxy Statement and vote in one of four ways: | ||||||
Via the Internet Visit the web site listed on your Notice | ![]() | By mail Sign, date and return a requested proxy card | ||||
By telephone Call the telephone number listed on your Notice |
| In person Attend the Annual Meeting of Stockholders in Atlanta, Georgia
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By Order of the Board of Directors, | ||||||
Robert H. Rigsby, Secretary | ||||||
March 16, 2018 |
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Key: A- Audit C- Compensation NCG- Nomination and Corporate Governance M- Member Ch- Chairperson | ||||||||||||||||||||||||||||||
Director qualifications | ||||||||||||||||||||||||||||||
Committee memberships
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Name
| Age
| Director
| Independent
| Other public
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John S. Day Former Partner, Deloitte & Touche LLP
| 69 | 2009 | ✓ | 0 | Ch | M | M | ∎ | ∎ | ∎ | |||||||||||||||||||
Carolyn B. Handlon EVP Finance and Global Treasurer, Marriott International
| 60 | 2017 | ✓ | 0 | M | Ch | M | ∎ | ∎ | ∎ | ||||||||||||||||||||
Edward J. Hardin Partner, Rogers & Hardin LLP
| 75 | 2014 | ✓ | 0 | M | M | M | ∎ | ∎ | ∎ | ||||||||||||||||||||
James R. Lientz, Jr. Former COO, State of Georgia
| 74 | 2012 | ✓ | 0 | M | M | Ch | ∎ | ∎ | ∎ | ||||||||||||||||||||
Dennis P. Lockhart Former President and CEO of Federal Reserve Bank of Atlanta
| 71 | 2017 | ✓ | 0 | M | M | M | ∎ | ∎ | ∎ | ||||||||||||||||||||
Gregory G. McGreevey Senior Managing Director, Investments, Invesco Ltd.
| 55 | 2016 | – | O | – | – | – | ∎ | ∎ | |||||||||||||||||||||
Colin D. Meadows Senior Managing Director and Chief Administrative Officer, Invesco Ltd.
| 47 | 2017 | – | O | – | – | – | ∎ | ∎ |
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The table above highlights certain skills, knowledge or experiences of our directors. The Board believes that all of the directors are highly qualified. As the table above and biographies below show, our directors have the significant leadership and professional experience, knowledge and skills necessary to provide effective oversight and guidance for the company’s strategy and operations. As a group, they represent diverse views, experiences and backgrounds. All the directors satisfy the criteria set forth in our Corporate Governance Guidelines and possess the characteristics that are essential for the proper functioning of our Board. |
Governance highlights |
Independence |
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5 out of our 7 current directors are independent. | ||||||
– | All of our Board committees are composed exclusively of independent directors. | |||||||
Independent chairperson |
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We have an independent Chairperson of our Board of Directors, selected by the independent directors. | ||||||
– | The Chairperson serves as liaison between management and the other independent directors.
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Executive sessions |
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The independent directors regularly meet in private without management. | ||||||
– | The Chairperson presides at these executive sessions.
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Board oversight of risk management |
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Our Board has principal responsibility for oversight of the company’s risk management process and understanding of the overall risk profile of the company.
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Stock ownership requirements |
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Ournon-executive directors must hold at least 12,500 shares of company common stock within five years of joining the Board. | ||||||
– | Our CEO must hold at least 60,000 shares of company common stock. | |||||||
– | All other executive officers have share ownership requirements.
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Board practices |
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Our Board annually reviews its effectiveness as a group, responding to a questionnaire andone-on-one interviews coordinated by an independent external advisor that reports results of the annual review to the Board. | ||||||
– | Nomination criteria are adjusted as needed to ensure that our Board as a whole continues to reflect the appropriate mix of skills and experience. | |||||||
Accountability |
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Directors must be elected annually by a majority of votes cast.
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Insider trading restrictions |
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Our insider trading policy prohibits short selling, dealing in publicly-traded options, pledging and hedging or monetization transactions in our equity securities.
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Additional information regarding the Annual Meeting | ||
Please seeGeneral Information Regarding the Annual Meeting beginning on page 35 for important additional information regarding the Annual Meeting. |
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Edward J. Hardin Chairperson,Non-Executive Director
Age 75 Director since 2014 | Edward J. Hardin | |||
Edward J. Hardin has served as our chairperson since August 2017 and a director since 2014. Mr. Hardin has been a partner of the law firm of Rogers & Hardin LLP since its formation in 1976 and is a member of its executive committee. Mr. Hardin received a B.A. degree from Wesleyan University and a J.D. degree from Vanderbilt University.
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Board committees | ||||
Audit, Compensation and Nomination and Corporate Governance
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Director qualifications:
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∎ | Executive leadership, corporate governance, legal expertise:Mr. Hardin has spent over 40 years as a corporate and business lawyer in a leading Atlanta law firm, including service as a member of its executive committee. Mr. Hardin has extensive experience with legal and business issues facing public companies in a variety of industries. Mr. Hardin’s broad background is a valuable asset to the Board’s functioning on many of the decisions it is called upon to take.
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∎ | Public company board experience:Mr. Hardin has served more than 40 years on boards of directors of other public companies. Mr. Hardin serves on the Board of Grady Memorial Hospital Corporation where he is a member of both the Audit and Finance Committees. Mr. Hardin is Chairman of the Board of Gateway Center LLC, a homeless services provider, Vice Chairman of the Board of Georgia Works! Inc., a residential transitional work training program,Co-Chairman of the regional Commission on Homelessness, a public private partnership of eight local governments and community leaders, Vice Chairman of the Fulton County Board of Health, Fulton County, Georgia and President of the Georgia Legal Services Foundation which supports indigent legal services. | |||
James R. Lientz, Jr. Non-Executive Director
Age 74 Director since 2012 | James R. Lientz, Jr. James R. Lientz, Jr. has served as a director since 2012 and as chairperson of the Nomination and Corporate Governance Committee since February 2018. Mr. Lientz has more than 35 years of experience in the banking industry and nearly eight in government service. Mr. Lientz served as President of C&S Bank of South Carolina from 1990 to 1992, President of Nationsbank of Georgia from 1993 to 1996 and President,Mid-South Division, of Bank of America from 1996 to 2001. His public sector work was as Chief Operating Officer of the State of Georgia from 2003 to 2010. Mr. Lientz is currently a partner with Safe Harbor Consulting, LLC. Mr. Lientz received a B.S. degree from Georgia Institute of Technology in 1965 and an M.B.A. from Georgia State University in 1971.
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Board committees | ||||
Audit, Compensation and Nomination and Corporate Governance (Chairperson).
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Director qualifications:
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∎ | Executive leadership, industry experience and public sector leadership:Mr. Lientz has more than 35 years of broad experience in financial-corporate management, specifically within the financial services industry. In addition, he brings to our board a perspective on leadership developed in the private and public sectors, having served as the first Chief Operating Officer for the State of Georgia for seven years. Mr. Lientz’s depth and breadth of board and executive experience uniquely qualify him to provide guidance to our company.
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∎ | Public and private company board experience:Mr. Lientz serves as a Director of the following private companies: Diversified Trust Company since 2015, Brand Holdings since 2015, MidCountry Financial Corp since 2010, and Georgia Banking Company since 2010. Mr. Lientz is a former Director of Georgia Power Company, BlueCross BlueShield of Georgia, NDC Health, J&J Invision and the Georgia Ports Authority. |
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Dennis P. Lockhart Non-Executive Director
Age 71 Director since 2017 | Dennis P. Lockhart Dennis P. Lockhart has served as a director since May 2017. Mr. Lockhart is the immediate past President and Chief Executive Officer of the Federal Reserve Bank of Atlanta, a position he held from March 2007 until his retirement in February 2017. In addition, he served on the U.S. Federal Reserve’s chief monetary policy body, the Federal Open Market Committee from 2007 to February 2017. Mr. Lockhart served on the faculty of Georgetown University’s School of Foreign Service from 2003 to 2007, and as an adjunct professor at Johns Hopkins University’s School of Advanced International Studies from 2002 to 2007. During his academic service, Mr. Lockhart was chairman of the Small Enterprise Assistance Funds. Earlier he was a managing partner at Zephyr Management LP, president of Heller International Group, chairman of the advisory committee of the U.S. Export-Import Bank, and held various positions with Citigroup (formerly Citigroup/Citibank). Mr. Lockhart received a B.A. from Stanford University, a Master’s in international economics and American foreign policy from Johns Hopkins University, and an honorary doctoral degree from Georgia State University. Mr. Lockhart served as an officer in the U.S. Marine Corps Reserve from 1968 to 1974.
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Board committees | ||||
Audit, Compensation, Nomination and Corporate Governance Committees
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Director qualifications:
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∎ | Executive leadership, finance and economic policy experience:Mr. Lockhart brings a wealth of finance and economic policy experience to the Board given his 10 years of service with the U.S. Federal Reserve Bank system, including monetary policy and economic regulation. Importantly, Mr. Lockhart also has more than 30 years of experience in the private financial sector which will greatly benefit the Board.
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∎ | Civil and policy organization experience:Mr. Lockhart also brings valuable perspectives and experience to the Board given his service as a director of the Metro Atlanta Chamber of Commerce from 2007 to present, the Commerce Club of Atlanta from 2007 to present, director of the World Affairs Council of Atlanta from 2010 to present, the Carter Center’s Board of Councilors from 2009 to present, trustee of the Georgia Research Alliance from 2016 to present, and the advisory board of the Andrew Young School of Policy Studies at Georgia State University from 2009 to present.
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Gregory G. McGreevey Director
Age 55 Director since 2016 | Gregory G. McGreevey Gregory G. McGreevey has served as a director since 2016. Mr. McGreevey has served as Senior Managing Director, Investments, of Invesco since March 2017, with responsibility including certain of Invesco’s global equities investment teams, equity trading, fixed income, Global Performance Measurement and Risk Group and investment administration. Previously, he was chief executive officer of Invesco Fixed Income from 2011 to March 2017. Prior to joining Invesco, he was president of Hartford Investment Management Co. and executive vice president and chief investment officer of The Hartford Financial Services Group, Inc. from 2008 to 2011. From 1997 to 2008, Mr. McGreevey served as vice chairman and executive vice president of ING Investment Management – Americas Region, as well as business head and chief investment officer for ING’s North American proprietary investments and chief executive officer of ING Institutional Markets. Before joining ING, Mr. McGreevey was president and chief investment officer of Laughlin Asset Management and president and chief operating officer of both Laughlin Educational Services and Laughlin Analytics, Inc. He is a Chartered Financial Analyst. Mr. McGreevey earned a B.B.A. from the University of Portland and an M.B.A. from Portland State University.
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Director qualifications:
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∎ | Executive leadership and industry experience:Mr. McGreevey has nearly 30 years of investment management industry experience, including as an investment professional and in a series of executive management positions. Mr. McGreevey’s deep experience with the fixed income and institutional investment products and his leadership of Invesco’s business in these areas provides the Board with great insight into issues facing the industry. |
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Colin D. Meadows Director
Age 47 Director since 2017 | Colin D. Meadows Colin D. Meadows has a director since August 2017. Mr. Meadows has served as Chief Administrative Officer of Invesco since 2006 with responsibility for information technology, operations, transfer agency and corporate development. In 2014, Mr. Meadows assumed Senior Managing Director responsibility for Invesco Real Estate, WL Ross and Co. and Invesco Private Capital. Mr. Meadows came to Invesco from GE Consumer Finance where he was senior vice president of business development and mergers and acquisitions. Prior to that role, he served as a senior vice president of strategic planning and technology at Wells Fargo Bank. From 1996 to 2003, Mr. Meadows was an associate principal with McKinsey & Co., focusing on the financial services and venture capital industries, with an emphasis in the banking and asset management sectors. Mr. Meadows earned a B.A. degree in economics and English literature from Andrews University and a J.D. from Harvard Law School.
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Director qualifications:
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∎ | Executive leadership, finance and economic policy experience:Mr. Meadows has extensive experience in the financial services industry, and he has focused on the banking and asset management sectors throughout his career. Mr. Meadows’ insight into the asset management business and the knowledge he has obtained as the Chief Administrative Officer of Invesco Ltd. are invalueable resources for the company and the Board.
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Director independence | ||||
For a director to be considered independent, the Board must affirmatively determine that the director does not have any material relationship with the company either directly or as a partner, stockholder or officer of an organization that has a relationship with the company. Such determinations are made and disclosed pursuant to applicable New York Stock Exchange (“NYSE”) or other rules. In accordance with the rules of the NYSE, the Board has affirmatively determined that it is currently composed of a majority of independent directors, and that the following directors are independent and do not have a material relationship with the company: John S. Day, Carolyn B. Handlon, Edward J. Hardin, James R. Lientz, Jr. and Dennis P. Lockhart.
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Director tenure | |||
The tenure of our current directors ranges from one to nine years (since our inception). Our directors contribute a wide range of knowledge, skills and experience as illustrated in their individual biographies. We believe the tenure of the members of our Board of Directors provides the appropriate balance of expertise, experience, continuity and perspective to our board to serve the best interests of our stockholders.
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As the Board considers new director nominees, it takes into account a number of factors, including nominees that have skills that will match the needs of the company’s long-term strategy and will bring diversity of thought, perspective, experience and background to our Board. For more information on our director nomination process, seeInformation about ourBoard and its Committees – the Nomination and Corporate Governance Committeebelow. | ||||
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The Board has adopted Corporate Governance Guidelines. | Corporate governance guidelines The Board has adopted Corporate Governance Guidelines (“Guidelines”) which are available in the corporate governance section of the company’s website at www.invescomortgagecapital.com (the “company’s website”). The Corporate Governance Guidelines set forth the practices the Board follows with respect to, among other matters, the composition of the Board, director responsibilities, Board committees, director access to officers and independent advisors, director compensation and the performance evaluation of the Board.
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The Board is elected by stockholders to oversee our management team and to seek to assure that the long-term interests of the stockholders are being served.
The company has chosen to separate the chief executive officer and Board chairperson positions. | Board leadership structure As described in the Guidelines, the company’s business is conductedday-to-day by its officers and its external manager, under the direction of the chief executive officer and the oversight of the Board, to enhance the long-term value of the company for its stockholders. The Board is elected by the stockholders to oversee the officers of the company and our external manager and to seek to assure that the long-term interests of the stockholders are being served. In light of these differences in the fundamental roles of the Board and management, the company has chosen to separate the chief executive officer and Board chairperson positions. The Board believes separation of these roles: (i) allows the Board more effectively to monitor and evaluate objectively the performance of the chief executive officer, such that the chief executive officer is more likely to be held accountable for his performance, (ii) allows the non-executive chairperson to control the Board’s agenda and information flow, and (iii) creates an atmosphere in which other directors are more likely to challenge the chief executive officer and other members of our senior management team. For these reasons, the company believes that this board leadership structure is currently the most appropriate structure for the company. Nevertheless, the Board may reassess the appropriateness of the existing structure at any time, including following changes in Board composition, in management, or in the character of the company’s business and operations.
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Our Board has established a Code of Conduct. | Code of conduct Our Board of Directors has established a code of ethics that applies to our officers, directors and independent contractors and to our manager’s officers, directors and personnel when such individuals are acting for or on our behalf (the “code of conduct”). Among other matters, our code of conduct is designed to deter wrongdoing and to promote:
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∎ | honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
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∎ | full, fair, accurate, timely and understandable disclosure in our SEC reports and other public communications;
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∎ | compliance with applicable governmental laws, rules and regulations;
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∎ | prompt internal reporting of violations of the code to appropriate persons identified in the code; and
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∎ | accountability for adherence to the code.
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Any waiver of the code of conduct for our executive officers or directors may be made only by our Board of Directors or one of our Board committees. The code of conduct is posted on the company’s website. We intend to satisfy the disclosure requirement regarding any amendment to, or a waiver of, a provision of the code of conduct by posting such information on the company’s website. |
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The Board has principal responsibility for oversight of the company’s risk management processes and for understanding the overall risk profile of the company. |
Board’s role in risk oversight We believe that risk oversight responsibility rests with the full Board of Directors. Therefore, the Board has principal responsibility for oversight of the company’s risk management processes and for understanding the overall risk profile of the company. Though Board committees routinely address specific risks and risk processes within their purview, the Board has not delegated primary risk oversight responsibility to a committee. | |
The company has in place an enterprise risk management committee consisting of executive and senior management. The committee meets regularly and maintains dialogue with the Board of Directors regarding the top risks of the company and mitigating actions to address them. By receiving regular reports, the Board maintains a practical understanding of the risk philosophy and risk appetite of the company. | ||
In addition, since the company is externally managed by our manager, we rely upon the operational and investment risk oversight functions of our manager and its Invesco affiliates. Our manager’s risk management framework provides the basis for consistent and meaningful risk dialogue up, down and across our manager and the company. Our manager’s Global Performance Measurement and Risk Group assesses core investment risks, while our manager’s Corporate Risk Management Committee assesses strategic, operational and all other business risks. A network of business unit, specific and geographic risk management committees, under the guidance and standards of the Corporate Risk Management Committee, maintains an ongoing risk assessment, management and monitoring process that provides abottom-up perspective on the specific risk areas existing in various domains of our manager’s business. | ||
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Through this regular and consistent risk communication, the Board has reasonable assurance that all material risks of the company are being addressed and that the company is propagating a risk-aware culture in which effective risk management is built into the fabric of the business. | ||
The Board, with the assistance of the Nomination and Corporate Governance Committee, annually reviews its own performance. |
Board’s annual performance evaluation As part of its annual performance evaluation of the Board and each of its committees, the Board engages an independent external advisor to coordinate the Board’s self assessment by its members. The advisor prepares a questionnaire for our directors, performsone-on-one interviews with directors and prepares a report for the Board’s review. The advisor presents the report in person to the Board, and the Board discusses the evaluation to determine what action, if any, could improve Board and committee performance. |
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The Audit Committee’s responsibilities include assisting the Board to oversee the company’s financial reporting. |
The Audit Committee is chaired by Mr. Day and consists additionally of Ms. Handlon, Mr. Hardin, Mr. Lientz and Mr. Lockhart. The committee met four times during 2017. Under its charter, the committee:
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∎ | is comprised of at least three members of the Board, each of whom is “independent” of the company under the NYSE and SEC rules and is also “financially literate,” as defined under NYSE rules;
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∎ | members are appointed and removed by the Board;
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∎ | is required to meet at least quarterly;
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∎ | periodically meets with the internal auditor and the independent auditor in separate executive sessions without members of senior management present;
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∎ | has the authority to retain independent advisors, at the company’s expense, whenever it deems appropriate to fulfill its duties; and
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∎ | reports to the Board regularly.
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The committee’s charter is available on the company’s website. The charter sets forth the committee’s responsibilities, which include assisting the Board in fulfilling its responsibility to oversee (i) the company’s financial reporting, auditing and internal control activities, including the integrity of the company’s financial statements, (ii) the independent auditor’s qualifications and independence, (iii) the performance of the company’s internal audit function and independent auditor, and (iv) the company’s compliance with legal and regulatory requirements.
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The Board has determined that all committee members are financially literate under the NYSE listing standards. The Board has further determined that each of Mr. Day and Ms. Handlon qualifies as an “audit committee financial expert” (as defined under the SEC’s rules and regulations), has “accounting or related financial management expertise” and is “independent” of the company under SEC rules and the NYSE listing rules.
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The Compensation Committee’s responsibilities include administration of our equity plan and approving the compensation fornon-executive directors. |
The Compensation Committee is chaired by Ms. Handlon and consists additionally of Mr. Day, Mr. Hardin, Mr. Lientz and Mr. Lockhart. The committee met two times during 2017. Under its charter, the committee:
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∎ | is comprised of at least three members of the Board, each of whom is “independent” of the company under the NYSE and SEC rules;
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∎ | members are appointed and removed by the Board; and
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∎ | has the authority to retain independent advisors, at the company’s expense, whenever it deems appropriate to fulfill its duties, including any compensation consulting firm.
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The committee’s charter is available on the company’s website. The charter sets forth the committee’s responsibilities, which include (i) annually approving the compensation structure for, and reviewing and approving the compensation from the company, if any, of, senior officers, and overseeing the annual process for evaluating their performance, (ii) overseeing the administration of the company’s equity-based and other incentive compensation plans, (iii) assisting the Board with executive succession planning, and (iv) determining the compensation for the company’snon-executive directors.
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In addition, the committee meets at least annually to review and make recommendations to the Board on the compensation of the company’snon-executive directors. |
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Base fee
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Eachnon-executive director received an annual base fee for services in the amount of $60,000, payable in cash.
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Equity award
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Eachnon-executive director received an annual equity award of $85,000, payable in shares of our common stock.
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Chairperson fee
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The Chairperson of the Board received an additional annual cash fee of $30,000.
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Audit Committee
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The chairperson of the Audit Committee received an additional annual cash fee of $20,000.
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Compensation Committee
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The chairperson of the Compensation Committee received an additional annual cash fee of $10,000.
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Nomination and Corporate
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The chairperson of the Nomination and Corporate Governance Committee received an additional annual cash fee of $10,000.
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We also reimburse each of ournon-executive directors for their travel expenses incurred in connection with attendance at Board of Directors and committee meetings.Non-executive directors do not receive any meeting or attendance fees. | ||||||
Stock ownership policy fornon-executive directors– All shares awarded to our non-executive directors are subject to theNon-Executive Director Stock Ownership Policy. The policy requires that within five years of the later of the effective date of the policy and the date of such director’s first appointment as anon-executive director eachnon-executive director achieve and thereafter maintain an ownership level of at least 12,500 shares. Until such ownership level is achieved, eachnon-executive director is required to continue to hold 100% of the shares received as compensation from the company. | ||||||
The following table shows as of December 31, 2017 the status of ournon-executive directors meeting the requirements of the policy. |
Director name |
Year service | Total shares held (#) | Share ownership goal met1 | |||
John S. Day | 2009 | 36,096 | ✓ | |||
Carolyn B. Handlon | 2017 | 2,093 | – | |||
Edward J. Hardin | 2014 | 23,274 | ✓ | |||
James R. Lientz, Jr. | 2012 | 25,435 | ✓ | |||
Dennis P. Lockhart | 2017 | 2,593 | – | |||
1 Based on current compensation levels, it is anticipated that Ms. Handlon and Mr. Lockhart will each attain the share ownership goal within the time period prescribed by the policy. |
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Director compensation table for 2017 | ||||||||||||
The following table sets forth the compensation paid to ournon-executive directors for services during 2017. |
Name |
Fees earned or | Share awards ($)2 | Total ($) | |||||||||
John S. Day | 80,000 | 84,960 | 164,960 | |||||||||
Carolyn B. Handlon3 | 24,565 | 35,264 | 59,829 | |||||||||
Edward J. Hardin | 70,000 | 84,960 | 154,960 | |||||||||
James R. Lientz, Jr. | 70,000 | 84,960 | 154,960 | |||||||||
Dennis P. Lockhart3
| 24,565 | 35,264 | 59,829 | |||||||||
Retired director | ||||||||||||
James S. Balloun
|
| 90,000
|
|
| 84,960
|
|
| 174,960
|
|
1 Includes the annual base fee and, as applicable, additional Chairperson of the Board fee, Chairperson of the Audit Committee fee, Chairperson of the Compensation Committee fee and Chairperson of the Nomination and Corporate Governance Committee fee. | ||
2 Reflects the full grant date fair value of such equity awards, determined in accordance with U.S. generally accepted accounting principles, as granted to each of ournon-executive directors in payment of the quarterly equity award. Equity awards are fully vested as of the date of grant. | ||
3 Ms. Handlon and Mr. Lockhart joined the Board in May 2017. | ||
The following table presents the grant date fair value for each equity award made to eachnon-executive director during 2017.
|
Name | Date of grant 2/23/17 ($) | Date of grant 5/5/17 ($) | Date of grant 8/8/17 ($) | Date of grant 11/7/17 ($) |
Total grant date fair value ($) | |||||||||||||||
John S. Day | 21,237 | 21,234 | 21,250 | 21,239 | 84,960 | |||||||||||||||
Carolyn B. Handlon1 | – | – | 14,025 | 21,239 | 35,264 | |||||||||||||||
Edward J. Hardin | 21,237 | 21,234 | 21,250 | 21,239 | 84,960 | |||||||||||||||
James R. Lientz, Jr. | 21,237 | 21,234 | 21,250 | 21,239 | 84,960 | |||||||||||||||
Dennis P. Lockhart1
| – | – | 14,025 | 21,239 | 35,264 | |||||||||||||||
Retired director | ||||||||||||||||||||
James S. Balloun
|
| 21,237
|
|
| 21,234
|
|
| 21,250
|
|
| 21,239
|
|
| 84,960
|
| |||||
1 Ms. Handlon and Mr. Lockhart joined the Board in May 2017. |
|
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R. Lee Phegley, Jr. Chief Financial Officer | R. Lee Phegley, Jr. Mr. Phegley (49) has served as our Chief Financial Officer since 2014 and the Chief Financial Officer of Invesco Real Estate (“IRE”), our manager’s affiliated real estate team, since 2016. Previously, Mr. Phegley served as the Global Head of Real Estate Investment Accounting for IRE from 2006 to 2016. Before joining Invesco, Mr. Phegley was a Director and responsible for Private Equity Accounting at Archon Group LP from 2004 to 2006. Prior to 2004, Mr. Phegley served as a Senior Manager at KPMG LLP for two years and Arthur Andersen LLP for seven years managing audit engagements for public and private clients, including investment management clients. Mr. Phegley received a B.A. degree from Baylor University and an M.S. degree in Accountancy from the University of Houston. Mr. Phegley is a Certified Public Accountant. | |
David B. Lyle Chief Operating Officer | David B. Lyle Mr. Lyle (39) has served as our Chief Operating Officer since October 2017. Previously, he served as our Executive Vice President Residential Credit from March 2017 to October 2017 and as our Head of Residential Mortgage Credit from 2011 to March 2017. He is also the Head of Residential Mortgage-Backed Securities (RMBS) Credit for Invesco Fixed Income. His primary responsibilities include the evaluation and oversight of investments inNon-Agency RMBS, credit risk transfer securities, and residential whole loans for institutional and retail fixed income funds, including the company. Mr. Lyle has over 15 years of experience in the RMBS market. Prior to joining Invesco in 2006, Mr. Lyle spent three years at Friedman Billings Ramsey, where he was a Vice President in the Investment Banking ABS group. In this role, he participated in the financing, transaction management and analytics functions of the business. He also spent two years as an Analyst in the mortgage finance group at Wachovia Securities. Mr. Lyle graduated with a bachelor of engineering degree from Vanderbilt University. |
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Our manager makes all decisions relating to the compensation of our executive officers based upon a number of objectives and principles. | Overview of our manager’s compensation program and philosophy Our manager makes all decisions relating to the compensation of our executive officers based on such factors as our manager may determine are appropriate. However, our manager consults with the members of the Compensation Committee concerning the compensation policy of our manager that is applied to the individuals that serve as our executive officers. Our manager has structured its compensation programs at every level to achieve the following objectives:
|
∎
| Alignment:align individual awards with client and shareholder success;
| |
∎
| Viability:reinforce our manager’s commercial viability by closely linking rewards to economic results at every level;
| |
∎
| Meritocracy:reinforce our manager’s meritocracy by differentially rewarding high- performers; and
| |
∎
| Retention:recognize and retain top talent by ensuring a meaningful mix of cash and deferred compensation.
|
Further, with respect to investment professionals, which include some of our executive officers, our manager applies the following compensation principles in making compensation decisions: |
Investment performance |
Qualitative assessment | |||
Measure investment performance against indicators of client success on products for which the investment team is responsible
| Ensure sufficient flexibility for management to exercise judgment over bonus funding outcomes, to ensure results make sense for Invesco and the team/ individual
| |||
Financial results
| Risk management
| |||
Provide appropriate linkage to our manager’s financial results related to the investment team
| Design plans that do not create risks that are reasonably likely to have a material adverse impact on Invesco
| |||
Balance
| ||||
Balance pay for investment performance with economic outcomes
|
Components of our executive officers’ compensation and their purpose Our manager utilizes a variety of compensation components to achieve its objectives. Our manager’s compensation program that applies to our executive officers consists of base salary and variable incentive compensation. The following table further describes each pay component, as well as its purpose and key measures. |
![]() |
Pay element
|
What it does
|
Key measures
| |||||||||
![]() |
Base salary |
– –
– |
Provides competitive fixed pay Reasonable base compensation forday-to-day performance of job responsibilities Evaluated annually, generally remains static unless promotion or adjustment due to economic trends in industry
|
– – |
Experience, duties and scope of responsibility Internal and external market factors | |||||||
![]() |
Annual cash bonus |
– |
Provides a competitive annual cash incentive opportunity |
– |
Based upon annual investment performance and financial results of the investment products for which the investment team is responsible
| |||||||
Invesco annual deferral award (time-based vesting) |
–
– –
|
Along with annual cash bonus, provides a competitive annual incentive opportunity Aligns with Invesco client and shareholder interests Encourages retention by vesting in equal annual increments over four years
|
– |
Based upon annual investment performance and financial results of the investment products for which the investment team is responsible | ||||||||
Invesco long-term equity awards (time-based vesting) |
–
– – |
Recognizes long-term potential for future contributions to Invesco’s long-term strategic objectives Aligns with Invesco client and shareholder interests Encourages retention by vesting in annual increments over four years |
– |
Based upon annual investment performance and financial results of the investment products for which the investment team is responsible |
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Our executive officers’ incentive compensation is funded from an incentive pool which is the source of incentive compensation of all employees of Invesco Ltd. | Our executive officers’ annual incentive compensation is funded from an annual incentive pool which is the source of incentive compensation of all employees of Invesco Ltd. and its affiliates. Each year, the Invesco Ltd. compensation committee examines Invesco’s progress on multiple operating measures, Invesco’s progress toward achieving its strategic objectives and other factors, includingpre-cash bonus operating income of Invesco (PCBOI), in setting the size of the incentive pool. The Invesco compensation committee uses a range of34%-48% of Invesco PCBOI in setting the Invesco-wide incentive pool, though it maintains flexibility to go outside either end of this range in circumstances that it deems exceptional. Our executive officers are paid incentive compensation out of the Invesco-wide incentive pool taking into account the compensation principles set forth above.
| |
For 2017, our executive officers’ compensation, in the aggregate, was apportioned 24% to fixed compensation and 76% to variable or incentive compensation.
| ||
| ||
We have an executive officer stock ownership policy to align the interests of our executive officers with our stockholders.
| Executive officer stock ownership policy In order to encourage the alignment of interests between our executive officers and our stockholders, we maintain an Executive Officer Stock Ownership Policy. The policy requires that, within five years of the date of such executive officer’s first appointment:
|
∎
| the chief executive officer (“CEO”) achieve an ownership level of at least 60,000 shares;
| |
∎
| the president, chief investment officer, and chief operating officer achieve an ownership level of at least 35,000 shares; and
| |
∎
| the chief financial officer (“CFO”) achieve an ownership level of at least 7,000 shares.
|
Our CEO and CFO have achieved their respective ownership level requirements, and we expect our other executive officers will attain their respective ownership requirements within the time period prescribed by the policy.
| ||
Insider trading policy We maintain an insider trading policy, which prohibits short selling, dealing in publicly-traded options, pledging, hedging or monetization transactions in our securities.
| ||
We believe the structure of the management fee does not create an incentive for excessive or unnecessary risk-taking by our management team and reduces risks of conflicts of interest with our manager. | Certain risks related to our management fee Because our management fee is calculated as a percent of stockholders’ equity, subject to specified adjustments, we believe the structure of the management fee does not create an incentive for management to take excessive or unnecessary risks and reduces risks of conflicts of interests with our manager. Stockholders’ equity as the basis for the calculation does not result in leveragedpay-out curves, steeppay-out cliffs or set unreasonable goals and thresholds, each of which can promote excessive and unnecessary risks. In addition, the management fee may not be increased or revised without the approval of our independent directors. |
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(As of December 31, 2017)
Plan category | Number of securities upon exercise of outstanding options, warrants and rights | Weighted average warrants and rights | Number of securities remaining available for future issuance under equity compensation plan | |||||||||
Equity compensation plans |
|
– |
|
|
– |
|
|
792,520 |
| |||
| ||||||||||||
Equity compensation plans |
|
– |
|
|
– |
|
|
– |
| |||
Total |
| –
|
|
| –
|
|
| 792,520
|
|
1 Represents the Invesco Mortgage Capital Inc. 2009 Equity Incentive Plan |
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| ||
Membership and role of the audit committee | ||
The Audit Committee consists of Mr. Day (chairperson) and Ms. Handlon, Mr. Hardin, Mr. Lientz and Mr. Lockhart. Each of the members of the Audit Committee is independent as such term is defined under the NYSE listing standards and applicable law. The primary purpose of the Audit Committee is to assist the Board of Directors in fulfilling its responsibility to oversee (i) the company’s financial reporting, auditing and internal control activities, including the integrity of the company’s financial statements, (ii) the independent auditor’s qualifications and independence, (iii) the performance of the company’s internal audit function and independent auditor, and (iv) the company’s compliance with legal and regulatory requirements. The Audit Committee’s function is more fully described in its written charter, which is available on the company’s website.
| ||
Review of the company’s audited consolidated financial statements for the fiscal year ended December 31, 2017 | ||
The Audit Committee has reviewed and discussed the audited financial statements of the company for the fiscal year ended December 31, 2017 with the company’s management. The Audit Committee has discussed with PricewaterhouseCoopers LLP (“PwC”), the company’s independent registered public accounting firm, the matters required to be discussed by professional auditing standards. The Audit Committee has also received the written disclosures and the letter from PwC required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor’s communications with the Audit Committee concerning independence, and has discussed the independence of PwC with that firm. Based on the Audit Committee’s review and discussions noted above, the Audit Committee recommended to the Board of Directors that the company’s audited consolidated financial statements be included in the company’s Annual Report on Form10-K for the fiscal year ended December 31, 2017 for filing with the Securities and Exchange Commission.
| ||
Respectfully submitted by the Audit Committee:
| ||
John S. Day (chairperson) | ||
Carolyn B. Handlon | ||
Edward J. Hardin | ||
James R. Lientz, Jr. | ||
Dennis P. Lockhart |
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(amounts in thousands) |
Year ended |
Year ended | ||||||
Audit fees1 | $1,395 | $1,374 | ||||||
Audit-related fees2 | – | – | ||||||
Tax fees3 | – | – | ||||||
All other fees4 | – | – | ||||||
Total | $1,395 | $1,374 |
1 Audit Fees consist of fees and related expenses billed for the audit of the consolidated financial statements and services provided by PwC in connection with statutory and regulatory filings or engagements. The audit fees include fees and expenses in connection with quarterly and annual reports and the issuance of consents by PwC to be named in, and the use of their audit report in, our registration statements. | ||||
2 Audit-Related Fees consist of fees and expenses billed for assurance and related professional services. PwC did not perform any audit-related services. | ||||
3 Tax Fees consist of professional services related to federal and state tax compliance and tax planning. PwC did not perform any tax services. | ||||
4 All Other Fees consist of any fees and expenses for professional services not included in one of the other categories. PwC did not perform any other services. |
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We have granted our manager and its affiliate registration rights with regard to common stock and OP units owned by such entities. |
Registration rights | |
We have entered into a registration rights agreement with regard to the common stock and OP units owned by our manager and Invesco Investments (Bermuda) Ltd., respectively, and any shares of common stock that our manager may elect to receive under the management agreement or otherwise. Pursuant to the registration rights agreement, we granted to our manager and Invesco Investments (Bermuda) Ltd., respectively: (1) unlimited demand registration rights to have the shares purchased by our manager or granted to it in the future and the shares that we may issue upon redemption of the OP units purchased by Invesco Investments (Bermuda) Ltd. registered for resale, and (2) in certain circumstances, the right to “piggy-back” these shares in registration statements we might file in connection with any future public offering so long as we retain our manager as the manager under the management agreement. |
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Name and address of beneficial owner |
Amount and | Percent of class (%) | ||||||
| ||||||||
BlackRock, Inc., 55 East 52nd Street, New York, NY 10055 | 17,610,0002 | 15.8 | ||||||
| ||||||||
The Vanguard Group, 100 Vanguard Boulevard, Malvern, PA 19355
|
|
10,103,1623 |
| | 9.1 |
|
1 Except as described otherwise in the footnotes to this table, each beneficial owner in the table has sole voting and dispositive power with regard to the shares beneficially owned by such owner. | ||
2 Information obtained solely by reference to the Schedule 13G/A filed with the SEC on January 9, 2018 by BlackRock, Inc. which reflects sole voting power with respect to 17,337,568 shares of common stock and sole dispositive power with respect to 17,610,000 shares of common stock. | ||
3 Information obtained solely by reference to the Schedule 13G/A filed with the SEC on February 9, 2018 by The Vanguard Group, which reflects sole voting power with respect to 123,133 shares of common stock, shared voting power with respect to 13,578 common shares of common stock, sole dispositive power with respect to 9,974,739 shares of common stock, and shared dispositive power with respect to 128,423 shares of common stock. |
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Name |
Shares owned | |||
| ||||
John Anzalone | 62,107 | |||
| ||||
Kevin Collins | 14,059 | |||
| ||||
John S. Day | 37,430 | |||
| ||||
Carolyn B. Handlon | 3,427 | |||
| ||||
Edward J. Hardin | 24,608 | |||
| ||||
James R. Lientz, Jr. | 26,769 | |||
| ||||
Dennis P. Lockhart1 | 65,677 | |||
| ||||
David Lyle2 | 17,768 | |||
| ||||
Jason Marshall | 24,210 | |||
| ||||
Gregory G. McGreevey | – | |||
| ||||
Colin D. Meadows | – | |||
| ||||
R. Lee Phegley, Jr. | 10,621 | |||
| ||||
All directors and executive officers as a group (12 persons)
| 286,676 | |||
|
1 Includes 1,750 shares held in custodial accounts and 500 shares held in trust. | ||
2 Includes 500 shares held by spouse of Mr. Lyle. |
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Q. What is the difference between holding shares as a “stockholder of record” and as a “beneficial owner”? |
∎Stockholders of record. You are a stockholder of record if at the close of business on the Record Date your shares were registered directly in your name with Computershare, our transfer agent.
|
∎Beneficial owner. You are a beneficial owner if at the close of business on the Record Date your shares were held by a brokerage firm or other nominee and not in your name. Being a beneficial owner means that, like most of our stockholders, your shares are held in “street name.” As the beneficial owner, you have the right to direct your broker or nominee how to vote your shares by following the voting instructions your broker or other nominee provides. If you do not provide your broker or nominee with instructions on how to vote your shares, your broker or nominee will be able to vote your shares with respect to some of the proposals, but not all. Please see “What if I return a signed proxy or voting instruction card, but do not specify how my shares are to be voted?” below for additional information.
|
∎ The company has requested banks, brokerage firms and other nominees who hold shares of our common stock on behalf of beneficial owners of the shares as of the close of business on the Record Date to forward the Notice to those beneficial owners. The company has agreed to pay the reasonable expenses of the banks, brokerage firms and other nominees for forwarding these materials. |
Q. How many votes do I have?
| ||
Every holder of a share of common stock on the Record Date will be entitled to one vote per share for each Director to be elected at the Annual Meeting and to one vote per share on each other matter presented at the Annual Meeting. On the Record Date, there were 111,636,216 shares of common stock outstanding and entitled to vote at the Annual Meeting.
| ||
Q. What proposals are being presented at the Annual Meeting?
| ||
The company intends to present proposals numbered one, two and three for stockholder consideration and voting at the Annual Meeting. These proposals are for: |
1 | Election of seven (7) members of the Board of Directors; | |
2 |
Advisory vote to approve the company’s executive compensation; and | |
3 |
Appointment of PricewaterhouseCoopers LLP as the company’s independent registered public accounting firm. | |
Other than the matters set forth in this Proxy Statement and matters incident to the conduct of the Annual Meeting, the company does not know of any business or proposals to be considered at the Annual Meeting. If any other business is proposed and properly presented at the Annual Meeting, the proxies received from our stockholders give the proxy holders the authority to vote on such matter in their discretion.
| ||
Q. How does the Board of Directors recommend that I vote?
| ||
The Board of Directors recommends that you vote: |
∎ FOR the election of the seven (7) directors nominated by our Board and named in this proxy statement;
|
∎ FOR the approval, on an advisory basis, of the compensation of our named executive officers; and
|
∎ FOR the appointment of PricewaterhouseCoopers LLP as the company’s independent registered public accounting firm. |
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Q. How do I attend the Annual Meeting?
| ||
All stockholders are invited to attend the Annual Meeting. An admission ticket (or other proof of share ownership) and some form of government-issued photo identification (such as a valid driver’s license or passport) will be required for admission to the Annual Meeting. Only stockholders who own company common stock as of the close of business on the Record Date and invited guests will be entitled to attend the meeting. An admission ticket will serve as verification of your ownership. Registration will begin at 1:00 p.m. Eastern Time and the Annual Meeting will begin at 2:00 p.m. Eastern Time. |
∎ If your company shares are registered in your name and you received or accessed your proxy materials electronically via the Internet, click the appropriate box on the electronic proxy card or follow the telephone instructions when prompted and an admission ticket will be held for you at thecheck-in area at the Annual Meeting. |
∎ If you received your proxy materials by mail and voted by completing your proxy card and checked the box indicating that you plan to attend the meeting, an admission ticket will be held for you at thecheck-in area at the Annual Meeting. |
∎ If your company shares are held in a bank or brokerage account, contact your bank or broker to obtain a written legal proxy in order to vote your shares at the meeting. If you do not obtain a legal proxy from your bank or broker, you will not be entitled to vote your shares, but you can still attend the Annual Meeting if you bring a recent bank or brokerage statement showing that you owned our common stock on the Record Date. You should report to thecheck-in area for admission to the Annual Meeting. |
Q. How do I vote and what are the voting deadlines?
| ||
You may vote your shares in person at the Annual Meeting or by proxy. There are three ways to vote by proxy: |
∎Via the Internet:You can submit a proxy via the Internet until 11:59 p.m. Eastern Time on May 1, 2018, by accessing the web site http://www.envisionreports.com/IVR and following the instructions you will find on the web site. Internet proxy submission is available 24 hours a day. You will be given the opportunity to confirm that your instructions have been properly recorded.
|
∎By telephone:You can submit a proxy by telephone until 11:59 p.m. Eastern Time on May 1, 2018, by calling toll-free1-800-652-VOTE (8683) (from the U.S. and Canada) and following the instructions.
|
∎By mail:If you have received your proxy materials by mail, you can vote by marking, dating and signing your proxy card and returning it by mail in the enclosed postage-paid envelope. If you hold your common stock in an account with a bank or broker (i.e. in “street name”), you can vote by following the instructions on the voting instruction card provided to you by your bank or broker. Proxy cards returned by mail must be received no later than the close of business on May 1, 2018. |
Even if you plan to be present at the Annual Meeting, we encourage you to vote your common stock by proxy using one of the methods described above. Stockholders of record who attend the meeting may vote their common stock in person, even though they have sent in proxies. |
Q. May I change or revoke my vote?
| ||
Yes. You may change your vote in one of several ways at any time before it is cast at the Annual Meeting: |
∎ Grant a subsequent proxy via the Internet or telephone; |
∎ Submit another proxy card (or voting instruction card) with a date later than your previously delivered proxy; |
∎ Notify our Secretary in writing before the Annual Meeting that you are revoking your proxy or, if you hold your shares in “street name,” follow the instructions on the voting instruction card; or |
∎ If you are a stockholder of record, or a beneficial owner with a proxy from the stockholder of record, vote in person at the Annual Meeting. |
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Q. What will happen if I do not vote my shares? |
∎Stockholders of record. If you are the stockholder of record of your shares and you do not vote in person at the Annual Meeting, or by proxy via the Internet, by telephone, or by mail, your shares will not be voted at the Annual Meeting. |
∎Beneficial owners. If you are the beneficial owner of your shares, your broker or nominee may vote your shares only on those proposals on which it has discretion to vote. Under the rules of the New York Stock Exchange, your broker or nominee has discretion to vote your shares on routine matters, such as Proposal No. 3, but does not have discretion to vote your shares onnon-routine matters, such as Proposals No. 1 and 2. Therefore, if you do not instruct your broker as to how to vote your shares on Proposals No. 1 and 2, this would be a “brokernon-vote,” and your shares would not be counted as having been voted on the applicable proposal. Pursuant to Maryland law, brokernon-votes and abstentions are not included in the determination of the shares of common stock voting on such matter, but are counted for quorum purposes.We therefore strongly encourage you to instruct yourbroker or nominee on how you wish to vote your shares. |
Q. What if I return a signed proxy or voting instruction card, but do not specify how my shares are to be voted? |
∎Stockholders of record. If you are a stockholder of record and you submit a proxy, but you do not provide voting instructions, all of your shares will be voted FOR Proposals No. 1, 2 and 3. |
∎Beneficial owners. If you are a beneficial owner and you do not provide the broker or other nominee that holds your shares with voting instructions, the broker or other nominee will determine if it has the discretionary authority to vote on the particular matter. Under NYSE rules, brokers and other nominees have the discretion to vote on routine matters, such as Proposal No. 3, but do not have discretion to vote onnon-routine matters, such as Proposals No. 1 and 2. Therefore, if you do not provide voting instructions to your broker or other nominee, your broker or other nominee may only vote your shares on Proposal No. 3 and any other routine matters properly presented for a vote at the Annual Meeting. |
Q. What does it mean if I receive more than one Notice of Internet Availability of Proxy Materials?
| ||
It means you own company common stock in more than one account, such as individually and jointly with another person.Please vote all of your common stock.Please see the section entitled Householding of Proxy Materials below for information on how you may elect to receive only one Notice.
| ||
Q. What is a quorum?
| ||
A quorum is necessary to hold a valid meeting. The presence, in person or by proxy, of stockholders entitled to cast a majority of all the votes entitled to be cast at such meeting on any matter shall constitute a quorum for the conduct of business.
| ||
Q. What vote is required in order to approve each proposal?
| ||
For each proposal, the affirmative vote of a majority of the votes cast on such proposal at the Annual Meeting is required. Votes “cast” include only votes cast with respect to shares present in person or represented by proxy and excludes abstentions and brokernon-votes.
| ||
Q. How will voting on any other business be conducted?
| ||
Other than the matters set forth in this Proxy Statement and matters incident to the conduct of the Annual Meeting, we do not know of any business or proposals to be considered at the Annual Meeting. If any other business is proposed and properly presented at the Annual Meeting, the persons named as proxies will vote on the matter in their discretion. |
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United States Securities and Exchange Commission reports | ||
A copy of the company’s Annual Report on Form10-K, including financial statements, for the fiscal year ended December 31, 2017 (the “Annual Report”), is being furnished concurrently herewith to all stockholders as of the Record Date. Please read it carefully.
| ||
Stockholders may obtain a copy of the Annual Report, without charge, by visiting the company’s website or by submitting a request to our Secretary at: company.secretary@ invescomortgagecapital.com or by writing Invesco Mortgage Capital Inc., Attn: Office of the Secretary, 1555 Peachtree Street N.E., Atlanta, Georgia 30309. Upon request to our Secretary, the exhibits set forth on the exhibit index of the Annual Report may be made available at a reasonable charge (which will be limited to our reasonable expenses in furnishing such exhibits).
| ||
Communications with the chairperson andnon-executive directors | ||
Any interested party may communicate with the Chairperson of our Board or to ournon-executive directors as a group at the following addresses:
| ||
E-mail: company.secretary@invescomortgagecapital.com | ||
Mail: Invesco Mortgage Capital Inc. 1555 Peachtree Street N.E. | ||
Atlanta, Georgia 30309 | ||
Attn: Office of the Secretary
| ||
Communications will be distributed to the Board, or to any of the Board’s committees or individual directors as appropriate, depending on the facts and circumstances of the communication. In that regard, the Board does not receive certain items which are unrelated to the duties and responsibilities of the Board.
| ||
In addition, the company maintains the Invesco Mortgage Capital Compliance Reporting Line for employees of the manager or its affiliates or individuals outside the company to report complaints or concerns on an anonymous and confidential basis regarding questionable accounting, internal accounting controls or auditing matters and possible violations of the company’s Code of Conduct or law. Further information about the Compliance Reporting Line is available on the company’s website.
| ||
Persons may submit any complaint regarding accounting, internal accounting controls or auditing matters directly to the Audit Committee of the Board of Directors by sending a written communication appropriately addressed to:
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Audit Committee | ||
Invesco Mortgage Capital Inc. 1555 Peachtree Street N.E. | ||
Atlanta, Georgia 30309 | ||
Attn: Office of the Secretary |
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Householding of proxy materials | ||
The SEC has adopted rules that permit companies and intermediaries (such as banks and brokers) to satisfy the delivery requirements for Proxy Statements and Annual Reports with respect to two or more stockholders sharing the same address by delivering a single Proxy Statement and Annual Report addressed to those stockholders. This process, which is commonly referred to as “householding,” potentially means extra convenience for stockholders and cost savings for companies.
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A number of banks and brokers with account holders who are beneficial holders of the company’s common stock will be householding the company’s proxy materials or the Notice. Accordingly, a single copy of the proxy materials or Notice will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your bank or broker that it will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive separate proxy materials or copies of the Notice, please notify your bank or broker, or contact our Secretary at: company. secretary@invescomortgagecapital.com, or by mail to Invesco Mortgage Capital Inc., Attn: Office of the Secretary, 1555 Peachtree Street N.E., Atlanta, Georgia 30309, or by telephone to404-892-0896. The company undertakes, upon oral or written request to the address or telephone number above, to deliver promptly a separate copy of the company’s proxy materials or the Notice to a stockholder at a shared address to which a single copy of the applicable document was delivered. Stockholders who currently receive multiple copies of the proxy materials or the Notice at their address and would like to request householding of their communications should contact their bank or broker or the Company Secretary at the contact address and telephone number provided above. |
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invescomortgagecapital.com IVRPROXY-BRO-1 03/18
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IMPORTANT ANNUAL MEETING INFORMATION |
Using ablack inkpen, mark your votes with anXas shown in this example. Please do not write outside the designated areas. | ![]() |
Electronic Voting Instructions
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone must be received by 11:59 p.m., Eastern Time, on May 1, 2018.
Vote by Internet
• Go towww.envisionreports.com/IVR
• Or scan the QR code with your smartphone
• Follow the steps outlined on the secure website
Vote by telephone
• Call toll free1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone
• Follow the instructions provided by the recorded message
q IF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
A | Proposals — | THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL BE VOTED “FOR” EACH OF THE NOMINEES FOR DIRECTOR AND “FOR” ITEMS 2 AND 3. | ||
1. | ELECTION OF DIRECTORS: | For | Against | Abstain | For | Against | Abstain | For | Against | Abstain | + | |||||||||||||||
1.1 - John S. Day | ☐ | ☐ | ☐ | 1.2 - Carolyn B. Handlon | ☐ | ☐ | ☐ | 1.3 - Edward J. Hardin | ☐ | ☐ | ☐ | |||||||||||||||
1.4 - James R. Lientz, Jr. | ☐ | ☐ | ☐ | 1.5 - Dennis P. Lockhart | ☐ | ☐ | ☐ | 1.6 - Gregory G. McGreevey | ☐ | ☐ | ☐ | |||||||||||||||
1.7 - Colin D. Meadows | ☐ | ☐ | ☐ | ☐ | ☐ | ☐ |
For
| Against
| Abstain
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For
|
Against
| Abstain
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2. ADVISORY VOTE TO APPROVE THE COMPANY’S EXECUTIVE COMPENSATION | ☐ | ☐ | ☐ | 3. APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | ☐ | ☐ | ☐ |
B | Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below |
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such.
Date (mm/dd/yyyy) — Please print date below.
| Signature 1 — Please keep signature within the box.
| Signature 2 — Please keep signature within the box.
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/ / |
⬛ | 1 U P X | + |
02RZJA
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Important notice regarding the Internet availability of proxy materials for the 2018 Annual Meeting of Stockholders. The 2018 Proxy Statement and the 2017 Annual Report on Form 10-K are available at:www.envisionreports.com/IVR
q IF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
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Proxy — INVESCO MORTGAGE CAPITAL INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF INVESCO MORTGAGE CAPITAL INC.
The undersigned hereby appoints Edward J. Hardin, John M. Anzalone, Kevin M. Collins, Richard Lee Phegley, Jr. and Robert H. Rigsby, and each of them, with power to act without the others and with power of substitution, as proxies and attorneys-in-fact, and hereby authorizes them to represent and vote, as provided on the other side, all the common stock of Invesco Mortgage Capital Inc. which the undersigned is entitled to vote, and, in their discretion, to vote upon such other business as may properly come before the 2018 Annual Meeting of Stockholders, or at any adjournment or postponement thereof, of Invesco Mortgage Capital Inc., to be held at Invesco’s headquarters located at 1555 Peachtree Street N.E., Atlanta, Georgia 30309, with all powers which the undersigned would possess if present at the meeting.
(Continued and to be marked, dated and signed, on the other side)
C | Non-Voting Items |
Change of Address — Please print your new address below.
| Comments — Please print your comments below.
| Meeting Attendance | ||||||||
Mark the box to the right if you plan to attend the Annual Meeting.
| ☐ |
⬛ | IF VOTING BY MAIL, YOUMUST COMPLETE SECTIONS A - C ON BOTH SIDES OF THIS CARD.
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