Ready Capital Corp

This advisory "say-on-pay" proposal asks shareholders to approve, on a non-binding basis, the Company’s executive compensation as disclosed in the proxy, including the Compensation Discussion and Analysis and compensation tables. Management is seeking approval to reaffirm its compensation framework that reimburses certain Named Executive Officers through the Manager, employs a formulaic annual cash incentive program tied to distributable ROE and adjusted distributable ROE plus individual goals, and grants long-term equity awards with time-based and performance-based vesting tied to distributable ROE and relative TSR. The Company’s external management structure and reimbursement practices mean some Named Executive Officers are paid by the Manager and then reimbursed by the Company, which the Compensation Committee reviews and oversees. The proposal is advisory and non-binding, but the Board and Compensation Committee state they will take stockholder feedback into account when setting future pay. Context in the filing shows recent pay outcomes — including less-than-target bonuses and forfeiture of prior performance RSUs — highlighting alignment and downside when performance thresholds are missed. Management frames the program as aligned with long-term value creation, peer benchmarking, and retention needs; critics might note the complexity of reimbursement arrangements and potential conflicts from external management. A vote FOR supports management’s stated approach and signals stockholder acceptance; a vote AGAINST would signal concern and likely prompt the Compensation Committee to reassess elements of pay, disclosure, or governance. The Board recommends FOR because it believes the structure aligns incentives to company performance, retention, and market practice while preserving flexibility to adjust in response to investor feedback.

This management proposal requests shareholder approval to increase the 2023 Equity Incentive Plan share reserve by 15,000,000 shares to a total 20,500,000 shares, primarily to allow stock settlement of March 2026 Equity Awards and to provide an ongoing reserve to fund future equity-based compensation. Management argues this is needed because the existing reserve (approximately 256,154 shares remaining as of the record date) would be insufficient for several years of equity grants and, without approval, the March 2026 Awards would be settled in cash. The March 2026 Equity Awards are substantial (7,575,000 PSUs and 2,525,000 RSUs) and are structured to promote retention and alignment: 75% are performance-based PSUs tied to ten price milestones (30‑day VWAP hurdles between $2.41 and $7.40 across the March 1, 2026–December 31, 2028 period) that vest in up to ten tranches, and 25% are RSUs that cliff vest on December 31, 2028, subject to continued employment and certain acceleration events (e.g., change in control or termination without cause). To mitigate dilution, the Company entered hedging arrangements covering 6,375,000 shares, but those hedges carry counterparty and execution risks and may not fully offset dilution. The board’s recommendation emphasizes retention of key management during a critical repositioning period and alignment of pay with stock price recovery potential; it also notes the awards convert to cash if stockholders do not approve the increase. Key governance considerations include the size of the increase relative to outstanding shares and potential dilution, the performance-based nature of the PSUs (which require meaningful stock appreciation to fully vest), the use of hedging to offset issuance, and the external management structure (where many executives are employees of the Manager). Approval would enable stock settlement and longer-term retention incentives; rejection would require cash settlement of the March 2026 awards and likely constrain future equity grant capacity, potentially affecting retention and alignment.