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Willis Lease Finance Corporation (NASDAQ:WLFC), which has delivered an impressive 270.8% return over the past year and maintains industry-leading gross profit margins of 91.5%, has recently renewed the employment agreement with Charles F. Willis IV, who will continue his role as the Executive Chairman of the Board. The new contract, effective as of March 13, 2025, extends for an initial term of five years with provisions for automatic annual renewals. According to InvestingPro analysis, the company’s strong performance metrics suggest the board’s confidence in leadership is well-placed.
Under the amended and restated agreement, Mr. Willis will receive an annual base salary of $1,269,000, retroactive to January 1, 2025. His target annual bonus is set at 150% of this base salary. The terms include comparable benefits, retirement entitlements, and severance conditions to the prior agreement, with additional provisions for termination by the company without cause or by Mr. Willis for good reason. This compensation package comes as the company maintains strong revenue growth of 36% and a modest P/E ratio of 11.3.
The Compensation Committee also approved a significant restricted stock award, the "Sign-On RS Award," which will be automatically granted on March 19, 2025. The award is valued at $8,000,000, translating to no less than 38,000 shares and no more than 55,000 shares of common stock, depending on the average market value during a specified period in March. This award will be fully vested upon grant.
Additionally, the Committee granted a non-qualified stock option for Mr. Willis to purchase up to 231,000 shares of common stock. The option vests over three years and has a five-year term with an exercise price set at the fair market value on the grant date. The option can remain exercisable for two years post-termination under certain conditions.
These compensatory arrangements are in line with the company’s 2021 Incentive Stock Plan and aim to secure leadership continuity. The detailed terms of the agreement are outlined in Exhibit 10.1 of the SEC filing. This move by Willis Lease Finance demonstrates the board’s confidence in Mr. Willis’s leadership and the strategic direction of the company. For a comprehensive analysis of WLFC’s financial health and future prospects, including 12 additional exclusive ProTips, visit InvestingPro, where you’ll find detailed research reports and expert insights.
In other recent news, Willis Lease Finance Corporation reported record revenues and significant profit growth for the full year 2024. The company achieved total revenues of $569.2 million, marking an all-time high, with earnings before tax increasing by 127% and net income rising by 159% compared to 2023. Despite these robust financial results, the company’s stock fell 14.23% in pre-market trading, potentially reflecting investor concerns about future earnings or broader market factors. Willis Lease expanded its credit facility to $1 billion, enhancing its financial flexibility. The company also announced the acquisition of nearly $1 billion in engines and aircraft in 2024, comprising both current and future technology assets. Analysts from firms like Federal and Wolf Research inquired about the engine market dynamics and the company’s strategic initiatives during the earnings call. Willis Lease is targeting a net leverage in the low 3x range and plans to continue diversifying its funding sources. The company is exploring potential test cell capabilities and preparing for durability kit implementations, which could drive future growth.
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