Triumph Financial (TFIN) DEF 14ADefinitive proxy

TRIUMPH FINANCIAL, INC.

12700 Park Central Drive, Suite 1700

Dallas, Texas 75251

(214) 365-6900

March 14, 2024

Dear Triumph Financial, Inc. Stockholders,

You are cordially invited to attend the Annual Meeting of Stockholders of Triumph Financial, Inc. (the “Company”). The meeting will be held on Tuesday, April 23, 2024. The Annual Meeting will begin promptly at 8:30 a.m., local time, at 3 Park Central, 12700 Park Central Drive, 15^th Floor, Dallas, Texas 75251.

A Notice of Annual Meeting of Stockholders and the Proxy Statement for the meeting are attached. To ensure your representation at the Annual Meeting, you are urged to vote by proxy via the Internet or telephone pursuant to the instructions provided in the enclosed proxy card; or by completing, dating, signing and returning the enclosed proxy card.

The Notice of Annual Meeting and Proxy Statement on the following pages contain information about the official business of the Annual Meeting. Whether or not you expect to attend, please vote your shares now. Of course, if you decide to attend the Annual Meeting, you will have the opportunity to revoke your proxy and vote your shares in person. This Proxy Statement is also available at www.proxydocs.com/TFIN.

Sincerely,

Aaron P. Graft

President and Chief Executive Officer

Notice of Annual Meeting of Stockholders

To be held April 23, 2024

Meeting Information

Voting Items

We are furnishing our 2023 Annual Report and proxy materials to our stockholders primarily through the Internet this year in accordance with rules adopted by the Securities and Exchange Commission. Stockholders of record have been mailed a Notice of Internet Availability of Proxy Materials on or around March 14, 2024, which provides them with instructions on how to vote and how to access the 2023 Annual Report and proxy materials on the Internet. It also provides instructions on how to request paper copies of these materials.

Stockholders of record who previously enrolled in a program to receive electronic versions of the 2023 Annual Report and proxy materials will receive an email notice with details on how to access those materials and how to vote.

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How to Vote

Stockholders of record may vote:

•				By Internet: go to www.proxypush.com/TFIN
•				By phone: call 866-206-5381
•				By mail: complete and return the enclosed proxy card in the postage prepaid envelope provided.

If your shares are held in the name of a broker, bank or other stockholder of record, please follow the voting instructions that you receive from the broker, bank or other stockholder of record entitled to vote your shares.

The Board of Directors has fixed the close of business on February 26, 2024 as the record date for the determination of stockholders entitled to notice of, and to vote at, the Annual Meeting.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders

to be Held on April 23, 2024.

The Proxy Statement for the 2024 Annual Meeting, the Notice of the 2024 Annual Meeting, the form of proxy and the Company’s 2023 Annual Report are available at www.proxydocs.com/TFIN.

2024 Proxy Statement

TABLE OF CONTENTS

		2024 Proxy Statement

Proxy Summary

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all the information you should consider in voting your shares. Please read the complete proxy statement and our annual report carefully before voting.

Your vote is important. You may vote your shares via the Internet, by telephone, by mail or in person at the Annual Stockholder Meeting. Please refer to the section “Information Concerning Solicitation and Voting” on page 1 for detailed voting instructions. If you vote via the Internet, by telephone or in person at the Annual Stockholder Meeting, you do not need to mail in a proxy card.

		2024 Proxy Statement

TRIUMPH FINANCIAL, INC.

12700 Park Central Drive, Suite 1700

Dallas, Texas 75251

(214) 365-6900

PROXY STATEMENT

FOR THE ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON

April 23, 2024

INFORMATION CONCERNING SOLICITATION AND VOTING

Introduction

We are furnishing this Proxy Statement on behalf of the Board of Directors (the “Board of Directors”) of Triumph Financial, Inc. (“Triumph”), a Texas corporation, for use at our 2024 Annual Meeting of Stockholders, or at any adjournments or postponements of the meeting (the “Annual Meeting”), for the purposes set forth below and in the accompanying Notice of Annual Meeting. The Annual Meeting will be held at 3 Park Central, 12700 Park Central Drive, 15th Floor, Dallas, Texas 75251, at 8:30 a.m. local time, on April 23, 2024.

In accordance with rules and regulations adopted by the Securities and Exchange Commission (“SEC”), instead of mailing a printed copy of our proxy materials to each stockholder of record, we are furnishing proxy materials to our stockholders on the Internet. You will not receive a printed copy of the proxy materials, unless specifically requested. The Notice of Internet Availability of Proxy Materials will instruct you as to how you may access and review all of the important information contained in the proxy materials. The Notice of Internet Availability of Proxy Materials also instructs you as to how you may submit your proxy on the Internet.

As used in this Proxy Statement, the terms “us”, “we”, “our”, the “Company” and “Triumph” refer to Triumph Financial, Inc., and, where appropriate, Triumph Financial, Inc., and its subsidiaries. The term “Common Stock” means shares of our Common Stock, par value, $0.01 per share.

Stockholders Entitled to Notice and to Vote; Quorum

Only holders of record of our Common Stock at the close of business on February 26, 2024, which the Board of Directors has set as the record date, are entitled to notice of, and to vote at, the Annual Meeting. As of February 26, 2024 we had 23,334,997 shares of Common Stock outstanding and entitled to vote at the Annual Meeting, and our shares of Common Stock were held by approximately 229 stockholders of record. Each stockholder of record of Common Stock on the record date will be entitled to one vote for each share held on all matters to be voted upon at the Annual Meeting. There are no cumulative voting rights in the election of directors.

The presence, in person or by proxy, of a majority of the votes entitled to be cast on a matter to be voted on at the Annual Meeting constitutes a quorum for action on that matter. The shares of Common Stock represented by properly executed proxy cards or properly authenticated voting instructions recorded electronically through the Internet or by telephone, will be counted for purposes of determining the presence of a quorum at the Annual Meeting. Abstentions and broker non-votes will be counted toward fulfillment of quorum requirements. A broker non-vote occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that proposal and has not received instructions from the beneficial owner.

		2024 Proxy Statement  1

Distinction Between Holding Shares as a Stockholder of Record and as a Beneficial Owner

Some of our stockholders hold their shares through a broker, trustee, or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those shares owned beneficially.

If you are not a stockholder of record, please understand that we do not know that you are a stockholder, or how many shares you own.

Voting Deadline

If you are a stockholder of record on the record date, then your proxy must be received no later than 11:59 p.m., central time on April 22, 2024 to be counted. If you are the beneficial owner of your shares held through a broker, trustee, or other nominee, please follow the instructions of your broker, trustee, or other nominee in determining the deadline for submitting your proxy.

Voting without Attending the Annual Meeting

Whether you hold shares directly as a stockholder of record or through a broker, trustee, or other nominee, you may direct how your shares are voted without attending the Annual Meeting. You may give voting instructions by the Internet, by telephone, or by mail. Instructions are on the proxy card. The proxy holders will vote all properly executed proxies that are delivered in response to this solicitation, and not later revoked, in accordance with the instructions given by you.

Voting in Person

Shares held in your name as the stockholder of record on the record date may be voted in person at the Annual Meeting. Shares for which you are the beneficial owner but not the stockholder of record may be voted in person at the Annual Meeting only if you obtain a legal proxy from the broker, trustee, or other nominee that holds your shares giving you the right to vote the shares. Even if you plan to attend the Annual Meeting, we recommend that you vote by proxy as described below so that your vote will be counted if you later decide not to attend the Annual Meeting.

The vote you cast in person will supersede any previous votes that you may have submitted, whether by Internet, telephone, or mail.

Required Votes

At the Annual Meeting, stockholders will consider and act upon (1) the election of eleven directors to our Board of Directors to serve until the next annual meeting of stockholders or until their respective successors

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have been elected and qualified, (2) the Say on Pay Proposal, (3) the ratification of the appointment of our independent registered public accounting firm, and (4) such other business as may properly come before the Annual Meeting.

Abstentions and Broker Non-Votes

Under certain circumstances, including the election of directors, matters involving executive compensation and other matters considered non-routine, banks and brokers are prohibited from exercising discretionary authority for beneficial owners who have not provided voting instructions to the bank or broker. This is generally referred to as a “broker non-vote.” In these cases, as long as a routine matter is also being voted on, and in cases where the stockholder does not vote on such routine matter, those shares will be counted for the purpose of determining if a quorum is present, but will not be included as votes cast with respect to those matters. Whether a bank or broker has authority to vote its shares on uninstructed matters is determined by stock exchange rules. We expect that brokers will be allowed to exercise discretionary authority for beneficial owners who have not provided voting instructions only with respect to the proposal to ratify the selection of Crowe LLP as our independent registered public accounting firm but not with respect to any of the other proposals to be voted on at the Annual Meeting.

Abstentions and broker non-votes will not be treated as votes cast for any of the proposals at the Annual Meeting and will have no effect on the results of such proposals.

Treatment of Voting Instructions

If you provide specific voting instructions, your shares will be voted as instructed.

If you hold shares as the stockholder of record and sign and return a proxy card or vote by Internet or telephone without giving specific voting instructions, then your shares will be voted in accordance with the recommendations of our Board of Directors. Our Board of Directors recommends (1) a vote for the election of each of the director nominees to our Board of Directors, (2) a vote for approval, on a non-binding advisory basis, of the compensation of our named executive officers as disclosed in this Proxy Statement, and (3) a vote for the ratification of the appointment of Crowe LLP as our independent registered public accounting firm.

You may have granted to your broker, trustee, or other nominee discretionary voting authority over your account. Your broker, trustee, or other nominee may be able to vote your shares depending on the terms of the agreement you have with your broker, trustee, or other nominee.

The persons identified as having the authority to vote the proxies granted by the proxy card will also have discretionary authority to vote, in their discretion, to the extent permitted by applicable law, on such other business as may properly come before the Annual Meeting and any postponement or adjournment. The Board of Directors is not aware of any other matters that are likely to be brought before the Annual Meeting. If any other matter is properly presented for action at the Annual Meeting, including a proposal to

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adjourn or postpone the Annual Meeting to permit us to solicit additional proxies in favor of any proposal, the persons named in the proxy card will vote on such matter in their own discretion.

Revocability of Proxies

A stockholder of record who has been given a proxy may revoke it at any time prior to its exercise at the Annual Meeting by either (i) giving written notice of revocation to our Corporate Secretary, (ii) properly submitting a duly executed proxy bearing a later date, or (iii) appearing in person at the Annual Meeting and voting in person.

If you are the beneficial owner of shares held through a broker, trustee, or other nominee, you must follow the specific instructions provided to you by your broker, trustee, or other nominee to change or revoke any instructions you have already provided to your broker, trustee, or other nominee.

Costs of Proxy Solicitation

Proxies will be solicited from our stockholders by mail and through the Internet. We will pay all expenses in connection with the solicitation, including postage, printing and handling, and the expenses incurred by brokers, custodians, nominees and fiduciaries in forwarding proxy material to beneficial owners. It is possible that our directors, officers and other employees may make further solicitations personally or by telephone, facsimile or mail. Our directors, officers and other employees will receive no additional compensation for any such further solicitations.

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PROPOSAL 1: ELECTION OF DIRECTORS

Introduction

Upon the recommendation of the Nominating and Corporate Governance Committee, the Board of Directors has nominated each of the directors noted below (whom we refer to as the “nominees”) to stand for election for a one (1) year term expiring at the 2025 annual meeting of stockholders or until their respective successors have been elected and qualified. Each director nominee must receive the affirmative vote of a majority of the votes cast to be elected (i.e., the number of shares voted “for” a director nominee must exceed the number of votes cast “against” that nominee). Unless contrary instructions are given, the shares represented by your proxy will be voted FOR the election of all director nominees.

All of the nominees listed above have consented to being named in this proxy statement and to serve if elected. However, if any nominee becomes unable to serve, proxy holders will have discretion and authority to vote for another nominee proposed by our Board. Alternatively, our Board may reduce the number of directors to be elected at the Annual Meeting.

		The Board of Directors unanimously recommends a vote FOR the election of each of the nominees.

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Information Concerning the Nominees and Directors

Biographical information for each director and nominee appears below. The information is based entirely upon information provided by the respective directors and nominees.

We believe our Board represents a broad mix of tenure, gender, ethnic, and cultural diversity with robust independence. Our Nominating and Corporate Governance Committee evaluates candidates for future directorships in light of these foregoing characteristics. In particular, the Board and the Nominating and Corporate Governance Committee believes it is appropriate to evaluate director diversity holistically by considering gender, ethnicity, as well as a range of other characteristics that inform diverse perspectives on our Board. Our Board does not manage to specific percentages or quotas for a particular type of diversity. In 2023, Davis Deadman was nominated and elected as director of the Company as part of the consolidation of the directorships of the Company and its subsidiary bank board. Director Deadman was nominated and elected to serve on the Company’s Board due to his prior experience with the Company as well as its subsidiary bank, and, in particular, due to his unique credit expertise and oversight thereto for the enterprise. Upon the election of Director Deadman in 2023, the Nominating and Corporate Governance Committee decided to not recommend any further changes to the composition of the Board (other than the election of Director Deadman and the corresponding increase in the size of the Board) as it believed the Board’s overall diversity (including the re-nomination of each incumbent director, which retained all existing diverse viewpoints on the Board notwithstanding any incremental reductions in percentage representation resulting from the increase in Board size) reflected then and continues to reflect now a commitment to diverse attributes and viewpoints on the Board. The Committee and the Board has determined such composition remains appropriate in 2024 and has noted that diversity will remain a key consideration when filling any future Board vacancy.

Director Tenure		Diversity		Independence

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Director Qualifications and Attributes

We endeavor to have a Board that represents a broad range of qualities, skills and depth of experience in areas that are relevant to and contribute to the Board’s oversight of the Company’s activities. Among others, the Board has considered these key experiences, qualifications, skills and attributes in evaluating the composition of the Board and in considering nominees for new directors.

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The table below summarizes the key experience, qualifications and attributes for each member of our Board and highlights the balanced mix of experience, qualifications and attributes of the Board as a whole. This high-level summary is not intended to be an exhaustive list of each director’s skills or contributions to the Board.

As of March 14, 2024 we are in compliance with Nasdaq Rule 5605(f) regarding Board diversity and we will remain in compliance with such rule following our Annual Meeting giving effect to the directors standing for election at the meeting. The following diversity statistics are presented in accordance with the standardized disclosure matrix set forth in such Rule:

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Directors Standing for Election at the 2024 Annual Meeting

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Information Regarding Executive Officers

Our executive officers are as follows:

A brief description of the background of each of our executive officers who is not also a director is set forth below.

W. Bradley Voss has served as our Executive Vice President, Chief Financial Officer since 2021. He also serves as Executive Vice President and Chief Financial Officer of TBK Bank, SSB. Mr. Voss joined the Company in a consulting engagement in 2011 and has served in various finance roles since joining the Company full-time in 2012. He was appointed as Chief Financial Officer in 2021. Prior to his current role, he led balance sheet strategy, capital issuance, investments, liquidity, and funding as the Company’s Senior Vice President and Treasurer from 2015 to 2019, and Executive Vice President and Treasurer from 2019 to 2021. Mr. Voss joined Triumph from CSG Investments (an affiliate of Beal Bank), where he led the sourcing, analysis and execution of investments in distressed securities as Senior Vice President and Portfolio Manager. Before joining CSG Investments, Mr. Voss served as a Portfolio Manager for Highland Capital Management, L.P. Earlier in his career, he worked in institutional equity sales and research at Donaldson, Lufkin & Jenrette and then Bear Stearns. Mr. Voss earned a Bachelor of Business Administration in accounting and finance from Texas Christian University and a Master of Business Administration from the University of Texas at Austin. He is a Chartered Financial Analyst (CFA) charter holder.

Ed Schreyer has served as Executive Vice President, Chief Operating Officer since 2022. He also serves as Executive Vice President and Chief Operating Officer of TBK Bank, SSB. Mr. Schreyer joined the Company in 2021 as President and Chief Operating Officer of TriumphPay. Mr. Schreyer joined the Company after 30 years of experience with CBRE Group, Inc. (NYSE: CBRE) where he was most recently Chief Operating Officer for the Americas Advisory business. During his years at CBRE, he led the Industrial and Logistics business serving top freight carriers and 3PL providers and he had executive oversight of the Security and Crisis Management Team. Mr. Schreyer holds a Bachelor of Science degree in Urban Studies/Affairs from Indiana University Bloomington.

Gail Lehmann has served as our Executive Vice President and Secretary since 2010. She also serves as Chief Regulatory and Governance Officer as well as Secretary of TBK Bank, SSB. Ms. Lehmann also served as the Chief Operating Officer of the Company and TBK Bank, SSB from 2010-2022. Previously, Ms. Lehmann served as Corporate Compliance Officer and Senior Vice President of Risk Management for

		2024 Proxy Statement  13

Bluebonnet Savings Bank, FSB, a $3 billion wholesale thrift. Ms. Lehmann has been in the banking industry for more than 30 years and has experience in all facets of banking operations with particular emphasis on regulatory compliance, risk management, information technology and venture capital environments. She also has expertise in the area of property and subsidiary management. Ms. Lehmann received a Bachelor of Science, with a Major in Public Administration/Political Science and a Minor in Criminal Justice, from the University of Illinois.

Todd Ritterbusch has served as the President of TBK Bank, SSB since 2022. Mr. Ritterbusch also served as the Executive Vice President and Chief Lending Officer of TBK Bank, SSB from 2019-2022. Prior to joining the Company, from 2002 to April of 2019, Mr. Ritterbusch served in various capacities with JPMorgan Chase Bank, including as the Managing Director, Market Executive for the Commercial Bank covering the Ft. Worth and West Texas markets. During his tenure with JPMorgan Chase Bank, Mr. Ritterbusch led a commercial banking team serving businesses with revenues between $20 million and $500 million across his market area. Mr. Ritterbusch holds a Bachelor of Science in Engineering from Purdue University and a Master of Business Administration from the Kellogg School of Management and a Master of Engineering Management from the McCormick School of Engineering at Northwestern University. He served on the boards of Cook Children’s Healthcare Foundation, Cook Children’s Health Plan and Leadership ISD.

Adam D. Nelson has served as our Executive Vice President, General Counsel and Assistant Secretary since 2013. He also serves as Executive Vice President, General Counsel and Assistant Secretary of TBK Bank, SSB. Mr. Nelson previously served as Vice President and Chief Compliance Officer of Trinitas Capital Management, LLC, a registered investment adviser. In addition, Mr. Nelson previously served as Vice President and Deputy General Counsel of ACE Cash Express, Inc., a financial services retailer. Prior to that, Mr. Nelson was an attorney with the firm of Weil Gotshal & Manges, LLP, where he focused on mergers and acquisitions, management led buyouts and private equity transactions. Mr. Nelson received a Bachelor of Arts in Economics, magna cum laude, from Baylor University and a Juris Doctorate, cum laude, from Harvard Law School.

Melissa Forman-Barenblit has served as President of TriumphPay since 2022. She joined TriumphPay as Senior Vice President and Chief Operations Officer in 2019. Ms. Forman-Barenblit has over 25 years of experience across multiple freight technologies companies. Before joining TriumphPay she spent nearly a decade leading sales and strategic partnerships for eCapital, LLC, a leading transportation factor. Ms. Forman-Barenblit holds a Masters of Business Administration from California State University, Dominquez Hills and a Bachelor of Science in Business Management from the University of Phoenix.

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CORPORATE GOVERNANCE

Board of Directors Meetings

During 2023, the Board of Directors held 4 meetings and committees of the Board held a total of 21 meetings. Each of our directors attended at least 75% of the total meetings of the Board and committees on which he or she served during 2023.

Director Independence

The Board of Directors has determined that with the exception of Aaron P. Graft and Davis Deadman, each of our current directors is an independent director as defined for purposes of the rules of the Securities and Exchange Commission (“SEC”) and the listing standards of The Nasdaq Stock Market (“Nasdaq”). For a director to be considered independent, the Board must determine that the director does not have a relationship with the Company that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making this determination, the Board will consider all relevant facts and circumstances, including any transactions or relationships between the director and the Company or its subsidiaries.

Board Committees

Our Board of Directors has established standing committees in connection with the discharge of its responsibilities. These committees include the Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee and the Risk and Compliance Committee. Our Board of Directors also may establish such other committees as it deems appropriate, in accordance with applicable law and regulations and our corporate governance documents.

Audit Committee. Our Audit Committee is composed of Michael P. Rafferty (Chair), Maribess L. Miller, Debra A. Bradford and C. Todd Sparks. The Audit Committee assists the Board of Directors in fulfilling its responsibilities for general oversight of the integrity of our financial statements, compliance with legal and regulatory requirements, the independent auditors’ qualifications and independence, and the performance of our internal audit function and independent auditors. Among other things, the Audit Committee:

The Audit Committee works closely with management as well as our independent auditors. The Audit Committee has the authority to obtain advice and assistance from and receive appropriate funding to engage outside legal, accounting or other advisors as the Audit Committee deems necessary to carry out its duties.

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The Audit Committee is composed solely of members who satisfy the applicable independence and other requirements of the SEC and the Nasdaq for Audit Committees and each of whom meet the additional criteria for independence of audit committee members set forth in Rule 10A-3(b)(1) under the Exchange Act. In addition, at least one member of the Audit Committee shall be a member of the Company’s Risk and Compliance Committee. Each of Mr. Rafferty and Ms. Miller is an “audit committee financial expert” as defined by the SEC. The Audit Committee has adopted a written charter that, among other things, specifies the scope of its rights and responsibilities. The charter is available on our website under the link entitled “Investor Relations – Corporate Governance” at www.tfin.com. Our Audit Committee met nine times during 2023.

Compensation Committee. Our Compensation Committee is composed of, Charles A. Anderson (Chair), Harrison B. Barnes, Richard L. Davis, and Carlos M. Sepulveda, Jr. The Compensation Committee is responsible for discharging the Board of Directors’ responsibilities relating to compensation of our executives and team members.

Among other things, the Compensation Committee:

The Compensation Committee is composed solely of members who satisfy the applicable independence requirements of the SEC and the Nasdaq. The Compensation Committee has adopted a written charter that, among other things, specifies the scope of its rights and responsibilities. The charter is available on our website under the link entitled “Investor Relations – Corporate Governance” at www.tfin.com. Our Compensation Committee met four times during 2023.

Nominating and Corporate Governance Committee. Our Nominating and Corporate Governance Committee is composed of Maribess L. Miller (Chair), Charles A. Anderson, Laura K. Easley and Richard L. Davis. The Nominating and Corporate Governance Committee is responsible for making recommendations to our Board of Directors regarding candidates for directorships and the size and composition of our Board of Directors. In addition, the Nominating and Corporate Governance Committee is responsible for overseeing our corporate governance guidelines and reporting and making recommendations to our Board of Directors concerning governance matters.

Among other things, the Nominating and Corporate Governance Committee:

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The Nominating and Corporate Governance Committee is composed solely of members who satisfy the applicable independence requirements of the SEC and the NASDAQ. The written charter for our Nominating and Corporate Governance Committee is available on our website under the link entitled “Investor Relations – Corporate Governance” at www.tfin.com. Our Nominating and Corporate Governance Committee met four times during 2023.

Risk and Compliance Committee. Our Risk and Compliance Committee is composed of Laura Easley (Chair), Debra A. Bradford, Davis Deadman, and Michael P. Rafferty. The Risk Management Committee is responsible for assisting the Board of Directors in the assessment of risk across the Company and its subsidiaries.

Among other things, the Risk and Compliance Committee:

The Risk and Compliance Committee is composed of a majority of members who satisfy the applicable independence requirements of the SEC and the Nasdaq. In addition, at least one member of the Risk and Compliance Committee shall be a member of the Company’s Audit Committee. The written charter for our Risk and Compliance Committee is available on our website under the link entitled “Investor Relations – Corporate Governance” at www.tfin.com. Our Risk Management Committee met four times during 2023.

Code of Business Conduct and Ethics and Code of Ethics for Senior Financial Officers

Our Board of Directors has adopted a code of business conduct and ethics (our “Code of Ethics”) that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer and persons performing similar functions. The Code of Ethics and supplemental code of ethics for CEO and senior financial officers is available upon written request to the Corporate Secretary, Triumph Financial, Inc., 12700 Park Central Drive, Suite 1700, Dallas, Texas 75251. If we amend or grant any waiver of a provision of our Code of Ethics that applies to our executive officers, we will publicly disclose such amendment or waiver on our website and as required by applicable law, including by filing a Current Report on Form 8-K.

Board Leadership Structure and Risk Oversight

Different individuals serve as our Chief Executive Officer and Chairman because our Board of Directors has determined that the separation of these offices enhances our Board of Directors’ independence and

		2024 Proxy Statement  17

oversight. Moreover, the separation of these roles allows our Chief Executive Officer to better focus on his growing responsibilities of running the Company, enhancing stockholder value and expanding and strengthening the Company’s franchise while allowing the Chairman to lead our Board of Directors in its fundamental role of providing advice to and independent oversight of management. Consistent with this determination, Carlos M. Sepulveda, Jr., serves as Chairman of our Board of Directors, and Aaron P. Graft serves as our Chief Executive Officer and President.

Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. We face a number of risks, including credit, interest rate, liquidity, operational, strategic and reputation risks. Management is responsible for the day-to-day management of risks the Company faces, while the Board of Directors, as a whole and through its committees, including its Risk and Compliance Committee, has responsibility for the oversight of risk management. In its risk oversight role, the Board of Directors has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed. The Chairman of the Board of Directors and independent members of the Board of Directors work together to provide strong, independent oversight of the Company’s management and affairs through its standing committees and, when necessary, special meetings of independent directors.

Compensation Committee Interlocks and Insider Participation

No members of our Compensation Committee are or have been an officer or employee of Triumph or any of our subsidiaries with the exception of our Chairman, Carlos M. Sepulveda, Jr. who previously served as Executive Chairman of the Company (service in such role ending in 2015) and who has subsequently been determined by our Board to be an independent director under the rules of the SEC and listing standards of Nasdaq. None of our executive officers serves or has served as a member of the Board of Directors, Compensation Committee or other board committee performing equivalent functions of any entity that has one or more executive officers serving as one of our directors or on our Compensation Committee.

Nomination of Directors

With respect to directors not nominated by Triumph, the Board of Directors identifies nominees by first evaluating the current members of the Board of Directors willing to continue in service. Current members of the Board of Directors with skills and experience that are relevant to our business and who are willing to continue in service are considered for re-nomination. If any member of the Board of Directors does not wish to continue in service or if the Board of Directors decides not to re-nominate a member for re-election, the Board of Directors then identifies the desired skills and experience of a new nominee in light of the criteria below. Current members of the Board of Directors are polled for suggestions as to individuals meeting the criteria below. The Board of Directors may also engage in research to identify qualified individuals. In evaluating a director nominee, the Board of Directors considers the following factors:

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Our goal is to assemble a Board of Directors that brings together a variety of perspectives and skills derived from high quality business and professional experience. In doing so, the Board of Directors will also consider candidates with appropriate non-business backgrounds.

Other than the foregoing, there are no stated minimum criteria for director nominees. The Board of Directors may also consider such other factors as it may deem in our best interests and the best interests of our stockholders. We also believe it may be appropriate for key members of our management to participate as members of the Board of Directors.

Stockholders may nominate directors for election to the Board of Directors. In order to nominate a director for election to the Board of Directors, stockholders must follow the procedures set forth in our Bylaws, including timely receipt by the Secretary of Triumph of notice of the nomination and certain required disclosures with respect both to the nominating stockholder and the recommended director nominee.

Directors may currently be elected by a majority of votes cast (in uncontested elections) or a plurality of votes (in contested elections) at any meeting called for the election of directors at which a quorum is present. The presence of a majority of the holders of our Common Stock, whether in person or by proxy, constitutes a quorum. The Board of Directors did not receive any recommendations from stockholders requesting that the Board of Directors consider a candidate for inclusion among the nominees in our Proxy Statement for this Annual Meeting. The absence of such a recommendation does not mean, however, that a recommendation would not have been considered had one been received.

Stockholder Communications with the Board of Directors

Every effort is made to ensure that the Board of Directors or individual directors, as applicable, hear the views of stockholders and that appropriate responses are provided to stockholders in a timely manner. Any matter intended for the Board of Directors, or for any individual member or members of the Board of Directors, should be directed to Adam D. Nelson, our General Counsel, with a request to forward the matter to the intended recipient. All such communications will be forwarded unopened.

Director Attendance at Annual Meeting of Stockholders

We encourage all incumbent directors, as well as all nominees for election as director, to attend the Annual Meeting of Stockholders, although we recognize that conflicts may occasionally arise that will prevent a director from attending an annual meeting. Ten of our eleven then serving directors attended our 2023 annual meeting.

Hedging Policy and Pledging Restrictions

We do not permit our directors or executive officers to engage in transactions that hedge such director’s or executive officer’s economic risk of owning shares of our Common Stock. Thus, our directors and executive officers may not engage in hedging transactions in the Company’s shares such as puts, calls, prepaid variable forwards, equity swaps, collars and other derivative securities on an exchange or in any other organized market. Our directors and executive officers also may not engage in short sales of the Company’s shares, meaning sales of shares that are not owned at the time of sale. In addition, the Company does not permit shares pledged by senior executive officers and directors to be applied toward stock ownership guidelines, and limits pledging to pre-approved exceptions where the executive officer or director can clearly demonstrate the financial ability to repay the loan without resorting to the pledged securities.

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COMPENSATION DISCUSSION AND ANALYSIS

In this section we discuss and analyze the compensation of our named executive officers (“NEOs”) including our Chief Executive Officer, the Chief Financial Officer and the next three most highly compensated executive officers. This discussion and analysis also includes a description of our compensation practices and philosophy, our decision making process for compensation matters, and the material factors impacting our compensation decisions for 2023 compensation.

Executive Summary

2023 Financial Performance

During 2023, the Company made significant advancements on key strategic initiatives while successfully navigating significant stress and uncertainty in the banking sector, a protracted recession in the transportation and freight industry, and an elevated interest rate environment that continued to put pressure on the Company’s clients and borrowers. These trends, which began in 2022 and continued throughout 2023, significantly impacted all of the economic sectors in which the Company operates, including banking, transportation, technology and payments. Notwithstanding these challenges, in particular the impact of the freight recession on near term earnings, the Company’s underlying business and long-term prospects continued to thrive, including significant achievements and high performance with respect to key operational and segment-level metrics during the year.

As a result of the headwinds discussed above, the Company determined during the course of 2023 to focus on: (i) moderating expense growth, (ii) controlling core deposit attrition in its banking franchise while maintaining a low overall cost of funds, (iii) continuing to organically grow and expand both transactional volumes and revenues at TriumphPay, and (iv) driving operational improvements in its factoring segment, positioning this business to take advantage of the eventual rebound in this market. The Company earned net income to common stockholders for 2023 of $37.9 million, or $1.61 per share, with the conditions outlined above placing pressure on near term earnings. However, as a result of successful execution of the initiatives above, the Company delivered key financial and strategic achievements across its business lines.

Banking

The banking segment successfully controlled deposit attrition and maintained a top tier overall cost of funds in the face of the elevated interest rate environment. The Company’s total cost of funds for the year ended December 31, 2023 was 1.21%, which compared favorably to other institutions across the U.S. banking sector.

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These efforts, combined with higher loan yields resulting from increased interest rates on floating rate loans, saw the segment increase its overall pre-tax net income compared to 2022. Pre-tax net income in the banking segment for the year ended December 31, 2023 was $136.2 million, compared to $121.2 million for the year ended December 31, 2022. The segment was also able to maintain overall credit quality despite a more difficult year for borrowers experiencing cash flow challenges caused by floating interest rates and overall economic stress, particularly in transportation and commercial real estate.

Payments

The payments segment continued to grow clients and revenues, with increased transaction volumes and fee generation offsetting the effects of falling transportation invoice prices. Throughout the year, TriumphPay continued to add additional freight brokers, shippers and factors to the payments network, and increased the total number of processed transactions constituting “network transactions” (i.e. those transactions processed between a freight broker payor client and a factor payee client on a fully integrated and structured basis). For the fiscal year ended December 31, 2023, TriumphPay:

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These efforts, together with the increased benefit of deposits generated at TriumphPay (i.e. the value of payments volumes processed by TriumphPay for the period they are received and held pending release to the payee) due to the elevated interest rate environment, saw the payments segment improve its EBITDA² margins over the course of the year, achieving positive EBITDA for the first time in the fourth quarter of 2023, ahead of the Company’s anticipated timeline.

Factoring

The factoring segment was directly and acutely impacted in 2023 by the ongoing freight recession and low invoice prices, with total volumes, revenues and client numbers all down compared to 2022 levels. However, the business made significant improvements in key areas of operational focus, including reductions in invoice ageing (i.e. reducing the percentage of factored invoices more than 15 days past due for payment) and the development of operational efficiencies using artificial intelligence and machine learning. These efforts both helped to offset the impact of the freight environment and positioned the business well to benefit from a rebound in the transportation industry.

The Company’s performance with respect to these key strategic initiatives helped drive overall returns for its stockholders despite the near term earnings pressure caused by the macroeconomic environment. Set forth below is a calculation and line graph presentation comparing the one, two and three year

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cumulative total shareholder return on the Company’s common stock, on a dividend reinvested basis, against the cumulative return of the NASDAQ Bank Index, the KBW Bank Index, the SPDR S&P Regional Banking EFT and the NASDAQ Global Select Indices for the period from December 31, 2020 to December 31, 2023. Our total stockholder return over this period outperformed each of the indices.

Named Executive Officers

Our NEOs as of December 31, 2023 are as set forth below.

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Compensation Design Principles and Governance Best Practices

Our compensation programs incorporate best practices, including the following:

Say on Pay/Say on Frequency

The Company has determined to hold stockholder advisory votes on our executive compensation (i.e. the “say on pay” vote) on an annual basis, as we believe holding this vote annually provides an effective way to obtain current information on stockholder sentiment about the Company’s executive compensation program. Additionally, while the say on pay vote is a formal means for soliciting stockholder feedback, the Company welcomes the opportunity to engage with stockholders at any time. The Company notes it has received historically high approval rates on its say on pay votes, receiving approximately 98% of all votes cast (excluding broker non-votes) in favor of its say on pay proposal at its 2023 annual meeting.

Executive Compensation Objectives and Policies

Below we summarize our compensation philosophy and guiding principles as well as our decision process and the outcomes of that process. Our executive compensation programs are designed to enable the Company to attract, motivate and retain talent needed for the Company’s success, reward executives for performance, align executive interests with those of our stockholders, provide competitive compensation and ensure a balanced approach that promotes sound risk management practices.

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We plan to achieve these objectives through the following guiding principles.

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The table below summarizes the purpose/objective of each compensation component used in our 2023 program.

Role of Compensation Committee Management and the Compensation Consultant

Role of the Compensation Committee

The Compensation Committee is responsible for discharging the Board’s duties in executive compensation matters and for administering the Company’s annual incentive and equity-based plans. This includes oversight of the total compensation programs of the Company’s CEO and other executive officers, including our NEOs. The Compensation Committee reviews all compensation components and performance for the Company’s Chief Executive Officer and other executive officers, including base salary, annual short-term incentives, long-term incentives (equity), benefits and other perquisites. In addition to reviewing competitive market values, the Compensation Committee examines the total compensation mix, pay-for-performance relationship and alignment with our compensation philosophy. The Committee also reviews the employment agreements for our NEOs. As the Committee makes decisions regarding the Chief Executive Officer and other executive officers’ compensation, input and data from management and outside advisors are provided for external reference and perspective. While the Chief Executive Officer makes recommendations on other executive officers’ compensation, the Committee is ultimately responsible for approving compensation for all executive officers. The Committee meets regularly in executive session without management.

Role of the Compensation Consultant

The Compensation Committee has the sole authority to retain and dismiss its own outside compensation consultants and any other advisors it deems necessary. In 2023, the Compensation Committee engaged Meridian Compensation Partners LLC (“Meridian”) as its outside compensation consultant. The role of a compensation consultant is to assist the Compensation Committee in analyzing executive compensation packages and to provide the Compensation Committee with information regarding market compensation levels, general compensation trends and best practices. The consultant also provides advice regarding the competitiveness of specific pay decisions and actions for our NEOs, as well as the appropriateness of the design of the Company’s executive compensation programs. Meridian also advised the Compensation Committee on the implementation of the Company’s annual incentive program and

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long-term incentive program for 2023. Meridian attended meetings of the Compensation Committee, including executive sessions, upon invitation. Meridian did not provide any other services to the Company. The Compensation Committee has assessed the independence of Meridian pursuant to the rules of the SEC and concluded that Meridian’s work for the Compensation Committee did not raise any conflicts of interest.

Role of Management

The Compensation Committee made all 2023 compensation decisions for our NEOs. As part of its decision making process, the Committee seeks information as appropriate from management (e.g. the Company’s CEO, CFO, legal and human resources departments). The Chief Executive Officer annually reviews the performance of each of the Company’s and its subsidiaries’ executive officers (other than himself). The conclusions reached and the compensation recommendations based on these reviews, including with respect to salary adjustments and bonuses, were presented to the Compensation Committee. The Compensation Committee exercised its discretion in modifying any recommended adjustment or award. The Chief Executive Officer’s performance is reviewed by the Compensation Committee and the Compensation Committee makes compensation decisions with respect to the Chief Executive Officer taking into account such review.

Peer Group and Competitive Benchmarking

The Committee made its determinations as to the compensation for its NEOs in 2023, including base salary level and annual and long-term incentive targets as a percentage of base salary, by analyzing the Company’s practices in comparison to approved banking and fintech peer groups. The Committee believes that the use of the two peer groups best represents both the Company’s banking operations as well as its growing transportation payments platform. The Committee did not set a specific weighting for the use of either group but reviewed both data sets against the responsibility of the applicable executive.

Banking Peer Group

In identifying and constructing a competitive banking peer group, the Committee, based on recommendations from Meridian, took into consideration asset size as the primary selection criteria. In order to reflect our unique business model, the peer group was further filtered to include companies with the highest percentage of Commercial and Industrial (“C&I”) loans to arrive at a reasonable size (i.e. 20 banks). This compensation peer group consisted of banks with assets between $5.1 billion and $13.7 billion as of the date of adoption of the peer group by the Company in 2022, compared to $6.1 billion for the Company at such time.

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FinTech Peer Group

The Compensation Committee also requested that Meridian prepare a peer group of fintech companies. This fintech peer group is intended to provide further context regarding the Company’s compensation decisions and to be evaluated together with the banking peer group, given the Company’s growing technology presence in transportation payments. The fintech peer group consisted of fintech companies with revenues between $29 million and $590 million.

In general, the Committee’s review of the practices of its peer groups on a consolidated basis suggested that a greater focus on equity-based compensation (both in amount and as a percentage of overall compensation) may be appropriate for the Company compared to its banking peers in order to remain competitive with market practice for the Company’s fintech peers.

2023 Executive Compensation Program and Pay Decisions

The Company’s executive compensation program for 2023 consisted of the following components: base salary, short-term cash incentives paid under our AIP, long-term equity awards under our LTIP, limited perquisites and employee benefit plans.

Base Salary

The Compensation Committee annually reviews each NEO’s base salary. In determining whether to adjust an NEO’s base salary, the Compensation Committee considers the following factors: competitive peer group and industry survey benchmark data, individual performance and the Company’s prospects for future growth and performance. The table below shows our NEOs base salaries for fiscal years 2022 and 2023 and the year over year percentage change in salaries.

Applicable NEO base salaries were adjusted in 2023 primarily to remain competitive with market pay levels and to reflect individual performance.

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At the January 2024 meeting of the Compensation Committee, based on updated market data, the Compensation Committee approved the following base salaries for our NEOs effective March 1, 2024:

Applicable NEO base salaries were adjusted in 2024 primarily to remain competitive with market pay levels across both the Company’s banking and fintech peers and to reflect individual performance.

Annual Incentive Program

Under the AIP, the Company pays cash incentive payments to our NEOs based on achieved performance against pre-determined annual performance goals. Our AIP is designed to motivate and reward our NEO’s for achieving these performance goals, which are linked to our annual business plan.

NEOs 2023 Target Bonus. Target bonuses are established by the Compensation Committee considering competitive market data, individual performance and internal equity with other executives. For the 2023 AIP, the Compensation Committee approved the following target bonuses (expressed as a percentage of base salary) for our NEOs: 60% for Mr. Graft and Mr. Schreyer and 40% for each of Mr. Voss, Ms. Forman-Barenblit and Ms. Lehmann. Each NEO was eligible to receive an actual bonus payout of between 0% and 150% of his or her respective target bonus, with the applicable percentage based on achievement of pre-established performance goals. In addition, at its discretion, the Compensation Committee may increase or decrease such calculated annual incentive payout by up to 30% for any NEO based on Company performance as well as individual or other relevant factors.

2023 Performance Measures, Weighting and Goals. For 2023, the Compensation Committee approved AIP goals related to the following five measures:

Each goal was assigned a 20% weighting. These measures were updated from 2022 to identify a key performance measure in each of the Company’s operating segments as well as an enterprise level measure. The selected performance measures were directly linked to our 2023 business plan and were deemed to be most reflective of our annual performance against strategic objectives, as more fully described below.

Earnings Per Share (“EPS”) was used as the Company’s overall enterprise objective, as the Compensation Committee believes this measure to be a key indicator of overall performance. In making the determination to use an Invoice Price Adjusted EPS calculation (as described in greater detail in the footnotes to the table below) the Compensation Committee sought to reduce the impact on EPS resulting from changes in actual average transportation invoice price (up or down) compared to the assumed price used in determining the performance target for this metric when calculating performance against the goal.

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Transportation invoice prices are highly correlated to the profitability of both our Factoring and Payments segments, and are generally driven by macroeconomic forces outside the control of management. The Compensation Committee determined to partially (as opposed to fully) adjust for the impact of transportation invoice prices in calculating Invoice Price Adjusted EPS in order to incentivize management to appropriately adjust its strategies over the course of the year to take into account a changing economic environment.

Banking Segment Pre-Tax Net Income was viewed by the Compensation Committee as the objective most reflective of the Banking Segment’s contribution to the overall strategic objectives of the Company, as such indicator would be positively impacted by success in key areas such as: (i) controlling core deposit attrition and maintaining a low overall cost of funds, (ii) managing the Company’s loan portfolio to generate revenue to support the enterprise and its investment in key strategic initiatives such as TriumphPay out of retained earnings, (iii) limiting non-interest expense growth and (iv) maintaining loan losses and specific reserves at acceptable levels. In making the determination to add a potential downward adjustment to the calculation of Banking Segment Pre-Tax Net Income (as described in greater detail in the footnotes to the table below), the Compensation Committee took into account the importance of maintaining credit quality in allowing the Company to achieve its strategic objectives and sought to place additional emphasis on this item.

In determining to use Payments Segment Q4 EBITDA Margin Percentage as the AIP objective for the Payments Segment, the Compensation Committee viewed such measure as the most important metric by which to gauge success of the segment, noting that establishing a path to EBITDA profitability was a long-term objective of the Company that had been communicated to and was being tracked by the Company’s investors. The Compensation Committee determined that using fourth quarter EBITDA margin percentage was the most appropriate measure of success against this objective as such measure would demonstrate the point in time improvement in such measure against a EBITDA Margin Percentage of (114)% for the fourth quarter of 2022.

For the Factoring Segment, invoice ageing improvement was deemed to be a key area of operational focus, as the collection and posting of invoices in a timely manner impacts the Company’s cash flow, overall customer satisfaction, and requires all operational areas across the segment to be functioning in an integrated and efficient manner. The 45 day target for collection and posting of an invoice was selected as this would indicate completion of such items within 15 days of the due date for a 30 day payment term invoice.

Personal performance priorities judge each executive and the executive team against achievement of objectives tied to departmental and Company growth and strategic vision, and would take into account feedback from the CEO (as to NEOs other than the CEO) and the Compensation Committee (as to the CEO and the other NEOs) as part of the annual review process for the executive team.

Performance goals for each measure were set at threshold, target and stretch levels, which correspond to a range of potential payouts (50% of target bonus for threshold performance, 100% of target bonus for target performance and 150% of target bonus for stretch performance for each metric). Awards are interpolated in between these levels to provide for incremental rewards.

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The table below shows that for 2023 the Company performed below threshold for the Invoice Price Adjusted EPS objective, just above target for the Banking Segment Pre-Tax Net Income objective, and above stretch for the Payments Segment Q4 EBITDA Margin Percentage and Factoring Segment Invoice Ageing objectives. In addition, each NEO was determined to have achieved his or her personal performance goal at 123% of target.

The Company’s performance below the threshold target for the Invoice Price Adjusted EPS objective was driven primarily by the impact of macroeconomic environment, as the ongoing freight recession was longer and more acute than anticipated at the beginning of 2023, which impacted not only average transportation invoice prices, but also utilization levels and volumes in the Factoring Segment as clients continued to leave the market. Such environment also impacted revenues and volume levels in the Payments Segment. This was offset by continued growth in new clients and revenue in the Payments Segment, but such growth was lower than would have been experienced in a better freight environment. In addition, the elevated interest rate environment continued to place stress on borrowers, resulting in elevated credit costs compared to 2022. Such impacts outweighed the incremental earnings generated in the Banking Segment from higher yields resulting from the elevated interest rate environment. Management was able to moderate the economic impacts described above by reducing non-interest expense growth compared to 2022, while still continuing to make progress on its strategic initiatives (in particular continued growth at TriumphPay). Non-interest expense grew 3.7% from 2022 to 2023, compared to 18.5% from 2021 to 2022. However, the overall effects of the foregoing resulted in GAAP EPS of $1.61 per share ($1.82 per share after the invoice price adjustment), which was below the threshold measure for the objective.

Notwithstanding the macroeconomic and freight headwinds impacting overall EPS, the Company executed on key segment level objections tied to its strategic plan, which resulted in performance at or above target for its segment level objectives. Performance at 102% of target for the Banking Segment Pre-Tax Net Income objective was the result of management’s success in moderating growth in total costs of funds and core deposit attrition in the elevated interest rate environment. The impact of this moderated cost of funds growth, together with the benefit in loan yields resulting from higher interest rates on floating rate loans, helped drive a 21.2% increase in net interest income for the segment in 2023 compared to 2022.

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This growth was offset in part by increased credit costs compared to 2022 as the Company’s borrowers continued to experience stress from the elevated interest rate environment and freight recession. Overall, however, credit costs remained controlled and within the credit adjustment thresholds approved by the Compensation Committee as part of the segment objective.

A key goal for the Company as part of its long-term strategic plan as communicated to investors has been to achieve EBITDA positive results for its Payments Segment by the end of 2024. For 2023, the Company sought to make meaningful progress toward this objective, with a target goal of improving its EBITDA margin from (114%) in the fourth quarter of 2022 to (50%) in the fourth quarter of 2023. Despite the headwinds caused by the falling freight market, the Company was able achieve positive EBITDA in the fourth quarter of 2023, one year ahead of its stated objective. These results were achieved by adding new clients onto the TriumphPay network, finding new sources of revenue from existing client relationships, and realizing the benefit of the rising interest environment as it grew the deposit balances associated with the payments received from network payors pending their release. Such achievement exceeded the stretch target for this goal and represented a significant accomplishment for the Company.

The Company exceeded the stretch target for its Factoring Segment Invoice Ageing objective, as it successfully improved internal processes related to the collection and posting of invoices. The percentage of transportation invoices collected and posted within 45 days was 98.5% for the year ended December 31, 2023. As previously noted, the Company believes these improvements position its factoring segment well to take advantage of a rebound in the freight market and increases in average invoice prices.

In determining performance for each executive at 123% of the target payout for performance against individual priorities, the Compensation Committee considered, among other items (i) its review of the performance of each NEO for the year, (ii) the Company’s overall success in delivering successful financial results and furthering key strategic initiatives over the year despite economic challenges as discussed above, and (iii) each NEO’s progress in furtherance of individual development goals.

The following table shows, for each of our NEOs, the target incentive payment under our AIP and the total calculated payout under the AIP for the Company’s 2023 fiscal year. Payouts were based exclusively on the level of achievement of pre-established Company performance goals and personal performance targets, as described above, and the Compensation Committee did not exercise its discretionary authority to adjust such amounts as provided for in the Company’s AIP.

Long-Term Incentive Program

Each year, the Company grants equity awards to our NEOs under our LTIP. The purpose of these grants is to align our NEOs with stockholder interests, reward our NEOs for long-term stockholder value creation and encourage retention of our NEOs. In addition, these equity grants align with our pay for performance philosophy as 50% of the equity awards issued under our LTIP are performance based restricted stock units. In addition, the value of all equity grants are directly linked to our share performance (and, in the case of stock option grants, have no value unless the share price appreciates after the grant date).

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Target equity awards for each individual are established by the Compensation Committee considering competitive market data, individual performance and internal equity with other executives. For 2023, the Compensation Committee approved the following annual targets (expressed as a percentage of base salary) of equity awards under our LTIP granted to our NEOs: 220% for Mr. Graft, 160% for Mr. Schreyer, 100% for Mr. Voss and Ms. Forman-Barenblit, and 75% for Ms. Lehmann.

In addition, at its discretion, the Compensation Committee may increase or decrease by up to 30% an NEO’s target LTIP award based Company performance, individual performance or other relevant factors. For 2023, each NEO’s LTIP award was approved at target. Other than Mr. Schreyer (as discussed below) each NEO’s LTIP award was issued 50% as performance based restricted stock units based on the Company’s relative and absolute total stockholder return (“TSR”) as more fully described below, 25% time-vested restricted stock units, and 25% nonqualified stock options. Prior to Mr. Schreyer’s promotion to Chief Operating Officer of the Company in 2022, Mr. Schreyer had been receiving equity awards consisting entirely of time-vested restricted stock awards. In connection with Mr. Schreyer’s promotion to Chief Operating Officer in 2022, the Company began transitioning Mr. Schreyer to the Company’s standard LTIP award structure over a two year period. In 2023, 50% of Mr. Schreyer’s LTIP award was issued pursuant to the Company’s standard award structure as described above, with the other 50% issued as time vested restricted stock units. In 2024 the Company anticipates issuing 100% of Mr. Schreyer’s award pursuant to the standard award structure.

The targeted grant value of each award type for each of our NEOs under our LTIP is as follows:

The performance based restricted stock unit awards provide for delivery of Common Stock to participants based on the Company’s relative and absolute TSR compared to two reference groups. In 2023, half of such restricted stock unit awards were issued based on TSR compared to a reference group of publicly traded banks with assets between $2.5 and $30 billion and half of such restricted stock unit awards were issued based on TSR compared to the Russell 3000 Data Processing and Outsourced Services index. Each of the awards first evaluates relative TSR over a three year performance period. Between 50% and 175% of the target number of shares subject to the award shall vest based on relative TSR as follows (with linear interpolation between the 25th and 75^th percentiles and between the 75^th and 90^th percentiles, as applicable):

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Following determination of the applicable relative TSR vesting percentage, the vested shares shall be subject to adjustment pursuant to a modifier based on absolute TSR over the same three year performance period. For absolute TSR at or below 30%, no modifier shall be applied and 100% of the vested shares based on the applicable relative TSR vesting percentage shall be earned and delivered. If the Company’s common stock achieves absolute TSR of 100% or more, 200% of the vested shares based on the applicable relative TSR vesting percentage shall be earned and delivered (with linear interpolation between absolute TSR of 30% and 100%).

As a result, the total shares that may be issued pursuant to our performance based restricted stock unit awards range from 0% to 350% of the target number of shares. In the event that the Company has negative absolute TSR during the performance period, the total number of shares that shall be earned and delivered pursuant to the award is capped at 100% of the target number of shares regardless of the Company’s relative TSR percentile. In addition, if the value of the total number of shares that would be earned and delivered pursuant to the award (computed as the product of the number of the vested shares multiplied by the closing price of the Company’s common stock on the Nasdaq Global Select Market on the applicable vesting date) exceeds 8 times the grate date value of the target number of shares for the award (computed as the product of the target number of shares multiplied by the closing price of the Company’s common stock on the Nasdaq Global Select Market on the grant date) the number of shares to be actually earned and delivered pursuant to the award will be capped at a number of shares that has a value as of the vesting date (computed as set forth above) equal to 8 times the grant date value of the target number of shares (computed as set forth above).

The Compensation Committee made the determination to include the absolute TSR modifier in its performance based restricted stock unit awards as part of a plan to attract and retain key strategic talent across the organization (including, but not limited to, its executive officers and NEOs). In connection therewith, it considered the continued separation between the compensation practices of its fintech peers (which typically offer larger total equity compensation opportunities) and its banking peers, as well as the possibility of significant stock price appreciation during the performance period given opportunities in Company’s strategic plan, and its desire to further align management and investors in executing such plan. The caps on total shares that may be delivered pursuant to the awards were deemed by the Compensation Committee to be appropriate in order to limit the total expense of the awards to the Company and to further align payouts on such awards to the returns experienced by investors.

In the event of termination of employment under certain circumstances, a prorated portion of the award for the period of service of the participant during the performance period would be earned and shares issued following the completion of the performance period and determination of the Company’s relative and absolute TSR.

The time vested restricted stock units and stock option grants each vest one-fourth on each of the first four anniversaries of the grant date, generally subject to the NEO’s continued employment through each such anniversary. Stock options are granted with an exercise price equal to the closing stock price of our Common Stock on the NASDAQ Global Select Market as of the date of grant.

Further detail regarding the treatment of such outstanding equity awards upon termination of employment of our NEO’s in various circumstances is described in this Proxy Statement in the table included in “Executive Compensation – Potential Payments as a Result of Termination or Change in Control (CIC).”

Achievement of May 1, 2020 PSU Awards

As previously disclosed in the proxy statement for the Company’s 2021 Annual Stockholders Meeting, on May 1, 2020, the Company issued to its NEOs performance based restricted stock unit awards (the “2020 TSR PSUs”). The 2020 TSR PSUs provide for delivery of Common Stock to participants ranging

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between 0% and 175% of the target 2020 TSR PSUs based on the Company’s relative TSR compared to a reference group of publicly traded banks with assets between $2.5 and $30 billion over a three year performance period. On April 30, 2023, the three year performance period for the 2020 TSR PSUs ended with the Company achieving a relative TSR in the 95th percentile of the applicable peer group, which resulted in an applicable vesting percentage of 175% of the target 2020 TSR PSUs granted. The vesting of such awards resulted the delivery of shares of Common Stock to our NEOs as follows: 11,530 shares to Mr. Graft and 6,209 shares to Ms. Lehmann. Mr. Voss, Mr. Schreyer and Ms. Forman-Barenblit did not receive the 2020 TSR PSU award.

Benefits and Other Compensation

The Company provides limited perquisites to our NEOs that we believe are reasonable, competitive and consistent with the Company’s overall compensation philosophy and market practice. In 2023, these perquisites consisted of a car allowance and country club dues for Mr. Graft. In addition, our NEOs are eligible for reimbursement for participation in a medical wellness program available to the Company’s directors and executive officers and certain other medical reimbursements.

Our NEOs participate in our group health and welfare programs and 401(k) plan on the same basis as our other employees. Under the 401(k) plan, our NEOs are eligible to receive an employer match contribution on the same terms as all other employees of the Company.

Additional Information about our Compensation Practices

Employment Agreements

We have entered into substantially identical employment agreements with each of our NEOs. The employment agreements are for one (1) year terms which terminate on December 31 of each year, subject to automatic renewal for successive one (1) year terms unless either party delivers 60 days’ prior written notice of non-renewal (and, in the event that a change in control occurs during the then-current term, such term shall be extended to end no earlier than the second anniversary of the change in control). Each employment agreement provides for an annual base salary, which may be increased or decreased during the term, and specifies that the executive is eligible to participate in the annual and long-term incentive programs maintained by the Company to the same extent as other executives of the Company.

Either the Company or the executive may terminate the executive’s employment prior to the expiration of the then-current term in accordance with the terms and conditions of the employment agreement, and if such termination of employment is by the Company without “cause” (as defined in the agreement) or by the executive for “good reason” (as defined in the agreement) (a “qualifying termination”), then the executive shall be entitled to receive, subject to execution and non-revocation of a release of claims in favor of the Company, cash severance in the amount of 1.5 times base salary for Mr. Graft and 1.0 times base salary for each of Mr. Voss, Mr. Schreyer, Ms. Forman-Barenblit and Ms. Lehmann, as well as, in each case, healthcare coverage continuation for a period of 18 months for Mr. Graft and Ms. Lehmann and 12 months for Mr. Voss, Mr. Schreyer and Ms. Forman-Barenblit. However, if the qualifying termination occurs within 24 months following a change in control, then the cash severance amount is increased to a multiple of base salary plus the trailing 3-year average bonus (3.0 times for Mr. Graft and 2.0 times for each of Mr. Voss, Mr. Schreyer, Ms. Forman-Barenblit and Ms. Lehmann) and the healthcare coverage continuation period is increased to 36 months for Mr. Graft and 24 months for Mr. Voss, Mr. Schreyer, Ms. Forman-Barenblit and Ms. Lehmann.

The employment agreements contain a better net after-tax cutback provision in respect of the excise tax imposed under Sections 280G and 4999 of the tax code, pursuant to which the executive’s change in control-related payments and benefits will be reduced to the extent necessary to prevent any portion of such payments and benefits from becoming subject to the excise tax, but only if, by reason of that reduction, the net after-tax benefit received by the executive exceeds the net after-tax benefit that the executive would receive if no reduction was made.

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The employment agreements also contain certain restrictive covenants, including a perpetual confidentiality covenant, and non-compete, employee, client, and investor non-solicit, and business non-interference covenants that apply during employment and for the one (1) year period immediately following termination of employment for any reason.

Compensation Recovery

The Company has adopted a Compensation Recovery Policy, which would be triggered by a material restatement of the Company’s financial statements. The Compensation Recovery Policy, which is intended to comply with Section 10D of the Securities and Exchange Act of 1934 and Nasdaq Listing Rule 5608 (the “Compensation Recovery Rule”), covers performance-based incentive and equity compensation awards erroneously received during the applicable recovery period if the vesting, settlement or payment of such awards is contingent upon the achievement of a specified performance metric (“erroneously received compensation”). Such erroneously received compensation, calculated in accordance with the Compensation Recovery Rule and generally determined to be the amount of compensation that would not have been paid to the executive officer if the financial statements were correct at the time of the payment, will be subject to recoupment in accordance with the terms of the Compensation Recovery Rule.

Hedging Policy and Pledging Restrictions

We do not permit our directors or executive officers to engage in transactions that hedge such director’s or executive officer’s economic risk of owning shares of our common stock. Thus, our directors and executive officers may not engage in hedging transactions in the Company’s shares such as puts, calls, prepaid variable forwards, equity swaps, collars and other derivative securities on an exchange or in any other organized market. Our directors and executive officers also may not engage in short sales of the Company’s shares, meaning sales of shares that are not owned at the time of sale. In addition, the Company does not permit shares pledged by directors and executive officers to be applied toward stock ownership guidelines, and limits pledging to pre-approved exceptions where the executive officer or director can clearly demonstrate the financial ability to repay the loan without resorting to the pledged securities.

Stock Ownership Guidelines

The Company has adopted stock ownership guidelines for our non-employee directors and executive officers as part of our commitment to corporate governance and to strengthen the alignment of our non-employee directors and executive officers with the interests of our stockholders. Under the guidelines, our directors, our Chief Executive Officer and our other executive officers are expected to accumulate shares of our common stock with a value equal to or exceeding the applicable ownership level prior to the fifth anniversary of adoption of the guidelines, or the fifth anniversary of their election or appointment, whichever is later (the “Measurement Date”) and thereafter maintain ownership of shares consistent with such guidelines.

For purposes of the guidelines, “shares” include shares owned outright, directly or indirectly, shares owned jointly or separately by the individual’s spouse, shares held in trust for the benefit of the individual, the individual’s spouse and/or children, restricted stock or restricted stock units, shares acquirable upon the net exercise of vested stock options, or deferred shares or deferred stock units. Unvested stock options and unearned performance-based restricted stock units do not count toward meeting the applicable guidelines.

Our applicable target stock ownership guidelines are as follows:

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Our Nominating and Corporate Governance Committee will periodically review each director’s or executive officer’s progress toward achieving the applicable guidelines. Each of our directors and executive officers is either within compliance with the guidelines or expected to achieve such compliance prior to his or her applicable Measurement Date.

Risk Assessment Review

The Company adheres to a conservative and balanced approach to risk. Management and the Board conduct regular reviews of the business to ensure it remains within appropriate regulatory guidelines and practice. The Company’s maintains an Incentive Compensation Risk Review Committee that risk reviews current incentive plans, material changes to existing plans and new incentive plans. Key findings from such risk reviews are reviewed and discussed with the Compensation Committee and the Compensation Committee includes risk review in its consideration of all new plans (or material changes to existing plans) presented to it for approval. Based on such review and analysis, the Compensation Committee has concluded that the Company’s incentive compensation programs provide appropriate balance across many performance measures and do not create risks that are reasonably likely to have a material adverse effect on the Company.

Accounting and Tax Treatment of Compensation

The Compensation Committee considers the effects of tax and accounting treatments when it determines executive compensation. Under Section 162(m) of the Internal Revenue Code (the “Code”) compensation paid to a covered executive officer of a publicly traded company in excess of $1 million in one (1) year is not deductible for federal income tax purposes. In structuring the Company’s compensation programs and in determining executive compensation, the Compensation Committee takes into consideration the deductibility limit for compensation. However, the Compensation Committee reserves the right, in the exercise of its business judgment, to establish appropriate compensation levels for executive officers that may exceed the limits on tax deductibility established under Section 162(m) of the Code. The employment contracts for the NEOs contain change of control limitation provisions pursuant to the Code Section 280G. If a change of control payment exceeds the limit for deductible payments under Section 280G of the Code, the higher of (i) safe harbor amounts; or (ii) full payments after tax (i.e., “best of after-tax benefit”) will be paid to the NEO. For the full payments, the NEO is responsible for paying the excise tax. The Compensation Committee takes into consideration the accounting effects of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718 in determining vesting periods for stock options and restricted stock awards under our 2014 Omnibus Incentive Plan.

		2024 Proxy Statement  37

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee has reviewed and discussed with Management the “Compensation Discussion and Analysis” disclosure appearing above in this Proxy Statement. Based on this review and discussion, the Compensation Committee recommended to the Board of Directors of the Company that the Compensation Discussion and Analysis be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which incorporates by reference the disclosure contained in this Proxy Statement.

March 14, 2024

The Compensation Committee:

Charles A. Anderson, Chairman

Carlos M. Sepulveda, Jr.

Harrison B. Barnes

Richard L. Davis

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2023 Summary Compensation Table

The following summary compensation table provides information regarding the compensation of our NEOs for our fiscal years ended December 31, 2023, 2022 and 2021.

The following table shows all amounts included in the “All Other Compensation” column for each NEO in 2023:

2023 All Other Compensation Table

		2024 Proxy Statement  39

2023 Grants of Plan-Based Awards Table