First American Financial Corp. Files Definitive Proxy Statement

Ticker: FAF · Form: DEF 14A · Filed: Apr 1, 2024 · CIK: 1472787

Sentiment: neutral

Topics: Proxy Statement, DEF 14A, First American Financial, Executive Compensation, Equity Awards

TL;DR

<b>First American Financial Corp. has filed its Definitive Proxy Statement for the period ending May 21, 2024.</b>

AI Summary

First American Financial Corp (FAF) filed a Proxy Statement (DEF 14A) with the SEC on April 1, 2024. Filing is a Definitive Proxy Statement (DEF 14A) for First American Financial Corp. The filing covers the period ending May 21, 2024, and was filed on April 1, 2024. Company's principal executive offices are located at 1 First American Way, Santa Ana, CA 92707. The filing includes data related to equity awards, pension costs, and stock awards for various periods. Specific data points include year-over-year changes in value of unvested equity awards and year-end fair values.

Why It Matters

For investors and stakeholders tracking First American Financial Corp, this filing contains several important signals. This filing provides detailed information on executive compensation, equity awards, and pension benefits, which are crucial for understanding shareholder voting matters. Shareholders can review this document to make informed decisions regarding director elections, executive compensation plans, and other corporate governance proposals.

Risk Assessment

Risk Level: low — First American Financial Corp shows low risk based on this filing. The filing is a routine proxy statement, providing standard disclosures without immediate financial or operational news.

Analyst Insight

Review the executive compensation and equity award details to understand potential impacts on shareholder value and corporate governance.

Key Numbers

Key Players & Entities

FAQ

When did First American Financial Corp file this DEF 14A?

First American Financial Corp filed this Proxy Statement (DEF 14A) with the SEC on April 1, 2024.

What is a DEF 14A filing?

A DEF 14A is a definitive proxy statement sent to shareholders before annual meetings, covering executive compensation, board nominations, and shareholder votes. This particular DEF 14A was filed by First American Financial Corp (FAF).

Where can I read the original DEF 14A filing from First American Financial Corp?

You can access the original filing directly on the SEC's EDGAR system. The filing is publicly available and includes all exhibits and attachments submitted by First American Financial Corp.

What are the key takeaways from First American Financial Corp's DEF 14A?

First American Financial Corp filed this DEF 14A on April 1, 2024. Key takeaways: Filing is a Definitive Proxy Statement (DEF 14A) for First American Financial Corp.. The filing covers the period ending May 21, 2024, and was filed on April 1, 2024.. Company's principal executive offices are located at 1 First American Way, Santa Ana, CA 92707..

Is First American Financial Corp a risky investment based on this filing?

Based on this DEF 14A, First American Financial Corp presents a relatively low-risk profile. The filing is a routine proxy statement, providing standard disclosures without immediate financial or operational news.

What should investors do after reading First American Financial Corp's DEF 14A?

Review the executive compensation and equity award details to understand potential impacts on shareholder value and corporate governance. The overall sentiment from this filing is neutral.

How does First American Financial Corp compare to its industry peers?

First American Financial Corp. operates in the title insurance and real estate services industry.

Are there regulatory concerns for First American Financial Corp?

The filing is made under the Securities Exchange Act of 1934, specifically Form DEF 14A, which requires detailed disclosures for proxy solicitations.

Industry Context

First American Financial Corp. operates in the title insurance and real estate services industry.

Regulatory Implications

The filing is made under the Securities Exchange Act of 1934, specifically Form DEF 14A, which requires detailed disclosures for proxy solicitations.

What Investors Should Do

  1. Analyze the compensation details for named executive officers.
  2. Review proposals related to director elections and advisory votes on executive compensation.
  3. Examine disclosures regarding equity awards and their valuation methodologies.

Key Dates

Year-Over-Year Comparison

This is a DEF 14A filing, which is a proxy statement, and does not contain direct financial performance comparisons to a prior filing of the same type.

Filing Stats: 4,512 words · 18 min read · ~15 pages · Grade level 13.2 · Accepted 2024-04-01 12:52:22

Filing Documents

Election of Class II Directors

Item 1. Election of Class II Directors 9

Advisory Vote to Approve Executive Compensation

Item 2. Advisory Vote to Approve Executive Compensation 10

Ratification of Selection of Independent Auditor

Item 3. Ratification of Selection of Independent Auditor 11 II. REQUIRED INFORMATION 12

Security Ownership of Management

Security Ownership of Management 12 Board and Committee Meetings 13 Independence of Directors 15 Board Leadership Structure; Meetings of Non-Management and Independent Directors 16 Annual Performance Evaluation 16 Risk Oversight 16 Director Attendance at Annual Meetings 18 Stockholder and Interested Party Communications with Directors 18 Transactions and Litigation with Management and Others 18 Executive Officers 19

Executive Compensation

Executive Compensation 21 Compensation Discussion and Analysis 21 Introduction 21 Executive Summary 21 Performance Overview 22 Pay Philosophy 27

Executive Compensation Program

Executive Compensation Program 32 Compensation Decision Process 34 Pay Elements and Practices 35 Impact of Tax and Accounting 49 Compensation Committee Report 50

Executive Compensation Tables

Executive Compensation Tables 51 Summary Compensation Table 51 Grants of Plan-Based Awards 52 Outstanding Equity Awards at Fiscal Year-End 53 Option Exercises and Stock Vested 54 Pension Benefits 54 Nonqualified Deferred Compensation 55 First American Financial Corporation 2024 Proxy Statement | i Page Potential Payments upon Termination or Change-in-Control 56 Pay Ratio 61 Pay Versus Performance 62 Clawback Policy Actions 67 Director Compensation 68 Code of Ethics 70 Corporate Governance Guidelines 70 Compensation Committee Interlocks and Insider Participation 70 Report of the Audit Committee 70 Securities Authorized for Issuance under Equity Compensation Plans 71 Relationship with Independent Registered Public Accounting Firm 71 Principal Accountant Fees and Services 71 Policy on Audit Committee Pre-approval of Audit and Permissible Nonaudit Services of Independent Auditor 72 Stockholder Proposals, Director Nominations and Proxy Access 72 Appraisal Rights 72 III. CORPORATE RESPONSIBILITY AND SUSTAINABILITY 73 IV. QUESTIONS AND ANSWERS 74 V. OTHER INFORMATION 81 APPENDIX A Non-GAAP Financial Measures A- 1 First American Financial Corporation 2024 Proxy Statement | ii First American Financial Corporation PROXY ST ATEMENT Solicitation of Proxies by the Board of Directors First American Financial Corporation's Notice of Annual Meeting, Proxy Statement, Annual Report and other proxy materials are available at www.firstam.com/proxymaterials The board of directors (our "Board") of First American Financial Corporation, a Delaware corporation (our "Company," "we" or equivalent terms), is soliciting proxies from holders of our common stock for use at the annual meeting of our stockholders to be held on May 21, 2024, at 1:00 PM Pacific time. The meeting will be held in a virtual-only meeting format online via live webcast using a unique link to be p

Election of Class II Directors

Item 1. Election of Class II Directors Our certificate of incorporation provides for a classified Board. Each person elected as a Class II director at the annual meeting of stockholders will serve for a three-year term expiring on the date of the 2027 annual meeting and until his or her successor in office is elected and qualified. Our Board has nominated the following individuals for election as Class II directors: Dennis J. Gilmore Margaret M. McCarthy Martha B. Wyrsch Unless otherwise specified by you in your proxy card, the proxies solicited by our Board will be voted "FOR" the election of each of the Class II director nominees. If any nominee should become unable or unwilling to serve as a director, the proxies will be voted for such substitute nominee(s) as shall be designated by our Board. Our Board presently has no knowledge that any of the nominees will be unable or unwilling to serve. Our Board recommends that you vote "FOR" each of these Class II director nominees. First American Financial Corporation 2024 Proxy Statement | 9 I. Proposals

Advisory Vote to Ap prove Executive Compensation

Item 2. Advisory Vote to Ap prove Executive Compensation Pursuant to Section 14A of the Securities Exchange Act of 1934 and Securities and Exchange Commission ("SEC") rules, we are seeking the advice of our stockholders on the compensation of our named executive officers ("NEOs") as presented in the "Executive Compensation" section of this proxy statement commencing on page 21 . Specifically, we are seeking stockholder approval of the following resolution: "RESOLVED, that the stockholders of First American Financial Corporation approve, on an advisory basis, the compensation of the Company's named executive officers, as disclosed in the Compensation Discussion and Analysis, the Summary Compensation Table and the related compensation tables, notes and narrative in the Proxy Statement for the Company's 2024 annual meeting of stockholders." We refer to this proposal as a "Say on Pay" proposal. As part of its process in determining executive compensation levels for 2023, the Compensation Committee has reviewed the results of last year's Say on Pay proposal, in which approximately 95% of our Company's shares present and entitled to vote approved, on an advisory basis, 2022 executive compensation. The stockholder support for the prior Say on Pay proposal reinforces the Compensation Committee's belief that it should continue its practice of implementing and overseeing executive compensation programs that provide for a substantial portion of the executive officers' total compensation to be related to our Company's consolidated financial performance. It also reinforces the Compensation Committee's view that, for executive officers, the mix of compensation should be weighted heavily toward at-risk pay and should include a substantial portion payable in equity. This is consistent with the overall philosophy of maintaining a pay mix that results fundamentally in a pay-for-performance orientation and a strong alignment between the interests of executive officers and long-t

Ratification of Selection of I ndependent Auditor

Item 3. Ratification of Selection of I ndependent Auditor The Audit Committee has selected PricewaterhouseCoopers LLP ("PwC") to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2024. Representatives of PwC are expected to participate in the annual meeting and will have an opportunity to make a statement and be available to respond to appropriate questions. Selection of our independent registered public accounting firm is not required to be submitted for stockholder approval, but the Audit Committee is seeking ratification of its selection of PwC from our stockholders as a matter of good corporate governance. If the stockholders do not ratify this selection, the Audit Com

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