Proxy Statement (Form DEF 14A)
SECURITIES AND EXCHANGE COMMISSION
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant☒
Filed by a Party other than the Registrant☐
Check the appropriate box:
| ☐ | Preliminary Proxy Statement |
| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ☒ | Definitive Proxy Statement |
| ☐ | Definitive Additional Materials |
| ☐ | Soliciting Material under §240.14a-12 |
(
(
Payment of Filing Fee (Check the appropriate box):
| ☒ | No fee required. |
| ☐ | Fee paid previously with preliminary materials. |
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act rules 14a6(i)(1) and 0-11 |
Dear Shareholder:
You are cordially invited to attend the annual meeting of shareholders of
The notice of annual meeting and the proxy statement appearing on the following pages describe the formal business to be transacted at the meeting. During the meeting, we also will report on the operations of the Company. Directors and officers of the Company, as well as a representative of the Company's independent registered public accounting firm, will be present to respond to appropriate questions of shareholders.
It is important that your shares are represented at this meeting, whether or not you attend the meeting in person and regardless of the number of shares you own. To make sure your shares are represented, we urge you to vote via the internet, telephone, or by returning a completed proxy card. If you attend the meeting, you may vote in person even if you have previously mailed a proxy card or voted via the internet or by telephone.
We look forward to seeing you at the meeting.
| Sincerely, | |
| Chairperson of the Board | President and Chief Executive Officer |
(812) 738-2198
NOTICE OF 2025 ANNUAL MEETING OF SHAREHOLDERS
| TIME AND DATE | 12:00 noon, local time, on |
| PLACE | |
| ITEMS OF BUSINESS | (1) | The election of four (4) directors to serve for a term of three (3) years; |
| (2) | The ratification of the selection of |
| (3) | An advisory vote on the compensation of our named executive officers as disclosed in the accompanying proxy statement; and | |
| (4) | The transaction of such other business as may properly come before the meeting and any adjournment or postponement of the meeting. |
|
RECORD DATE |
In order to vote, you must have been a shareholder at the close of business on |
| PROXY VOTING | It is important that your shares be represented and voted at the meeting. You can vote your shares via the internet, by telephone, or by completing and returning a proxy card. A printed proxy card for the annual meeting and a self-addressed, postage pre-paid envelope will be mailed to those shareholders that have not voted as of |
| BY ORDER OF THE BOARD OF DIRECTORS | |
| Corporate Secretary |
PROXY STATEMENT
GENERAL INFORMATION
We are providing this proxy statement to you in connection with the solicitation of proxies by the Board of Directors (the "Board") of
We will hold the annual meeting at the Bank's main office,
We intend to provide access to this proxy statement and a proxy card to shareholders of record beginning on or about
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE SHAREHOLDER MEETING TO BE HELD ON
This Proxy Statement is available at http://www.edocumentview.com/FCAP.
Also available on this website is the Company's 2024 Annual Report on Form 10-K, as filed with the
INFORMATION ABOUT VOTING
Who Can Vote at the Meeting
You are entitled to vote your shares of
The Company's Articles of Incorporation provide that record holders of
Ownership of Shares; Attending the Meeting
You may own your shares of common stock of
| ● | Directly in your name as shareholder of record; | |
| ● | Indirectly through a broker, bank, or other holder of record in "street name"; or | |
| ● | Indirectly through the First Harrison Bank Employee Stock Ownership Plan (the "ESOP") and Trust. | |
If your shares are registered directly in your name, you are the holder of record of those shares and we are sending these proxy materials directly to you. As the holder of record, you have the right to give your proxy directly to us to vote at the annual meeting or you may vote in person at the annual meeting.
If you hold your shares in street name, your broker, bank, or other holder of record is sending these proxy materials to you. As the beneficial owner, you have the right to direct your broker, bank, or other holder of record how to vote by filling out a voting instruction form that accompanies your proxy materials. Your broker, bank, or other holder of record may allow you to provide voting instructions by telephone or by the internet. Please see the instruction form provided by your broker, bank, or other holder of record that accompanies this proxy statement. If you hold your shares in street name, you will need proof of ownership to be admitted to the meeting. A recent brokerage account statement or a letter from your bank or broker are examples of proof of ownership. If you want to vote your shares of
Participants in the ESOP may direct the ESOP trustees how to vote the shares allocated to their accounts. See "Participants in the ESOP" below.
Quorum and Vote Required
Quorum. We will have a quorum and will be able to conduct the business of the annual meeting if the holders of a majority of the outstanding shares of common stock entitled to vote are present at the meeting, either in person or by proxy.
Votes Required for Proposals. At this year's annual meeting, shareholders will elect four (4) directors to each serve for a term of three (3) years. In voting on the election of directors, you may vote in favor of all nominees, withhold votes as to all nominees, or withhold votes as to specific nominees. There is no cumulative voting for the election of directors. Directors must be elected by a plurality of the votes cast at the annual meeting. This means that the nominees receiving the largest number of votes cast will be elected up to the maximum number of directors to be elected at the annual meeting. The maximum number of directors to be elected at the annual meeting is four (4).
In voting on the ratification of the appointment of
In voting on the advisory resolution to approve the compensation of the Company's named executive officers ("NEO"), you may vote in favor of the proposal, against the proposal, or abstain from voting. To be approved, the proposal requires the affirmative vote of a majority of the votes cast at the annual meeting. Because your vote is advisory, it will not be binding on the Board or the Company. However, the Board will review the voting results and take them into consideration when making future decisions regarding executive compensation.
Effect of Not Casting Your Vote. If you hold your shares in street name, it is critical that you cast your vote if you want it to count in the election of directors or with respect to the advisory proposal regarding executive compensation. Your bank or broker is unable to vote your uninstructed shares in the election of directors or with respect to the advisory proposal regarding executive compensation. Therefore, if you hold your shares in street name and you do not instruct your bank or broker how to vote in the election of directors or with respect to the advisory proposal regarding executive compensation, no votes will be cast on your behalf. These are referred to as "broker non-votes." Your bank or broker, however, will continue to have discretion to vote any uninstructed shares on the ratification of the appointment of the Company's independent registered public accounting firm. If you are a shareholder of record and you do not cast your vote, no votes will be cast on your behalf on any of the items of business at the annual meeting.
How We Count Votes. If you retuvalid proxy instructions or attend the meeting in person, we will count your shares to determine whether there is a quorum, even if you abstain from voting. Broker non-votes also will be counted to determine the existence of a quorum.
In the election of directors, votes that are withheld and broker non-votes will have no effect on the outcome of the election.
In counting votes on the ratification of the appointment of the independent registered public accounting firm and the advisory resolution regarding executive compensation, abstentions and broker non-votes will have no effect on the outcome of the proposals.
Voting by Proxy
The Board is sending you this proxy statement for the purpose of requesting that you allow your shares of our common stock to be represented at the annual meeting by the designated proxies named by the Board. All shares of our common stock represented at the meeting by properly executed and dated proxies will be voted according to the instructions indicated on the proxy card. If you sign, date, and retua proxy card without giving voting instructions, your shares will be voted as recommended by the Board.
The Board recommends a vote:
| ● | "FOR" each of the nominees for director; | |
| ● | "FOR" the ratification of |
|
| ● | "FOR" the approval of the compensation of the Company's named executive officers as disclosed in this proxy statement. |
If any matters not described in this proxy statement are properly presented at the annual meeting, the persons named in the proxy card will use their own best judgment as to how to vote your shares. This includes a motion to adjouor postpone the annual meeting in order to solicit additional proxies. If the annual meeting is postponed or adjourned, your common stock may be voted by the persons named in the proxy card on the new meeting date as well unless you have revoked your proxy. The Company does not know of any other matters to be presented at the meeting.
You may revoke your proxy at any time before the vote is taken at the annual meeting. To revoke your proxy, you must either advise the Company's Corporate Secretary in writing before your shares have been voted at the annual meeting, deliver valid proxy instructions with a later date, or attend the meeting and vote your shares in person. Attendance at the annual meeting will not in itself constitute revocation of your proxy.
Instead of voting by mailing a proxy card, registered shareholders can vote their shares of
Participants in the ESOP
If you participate in the ESOP, you will receive a voting instruction form for all shares you may vote under the plan. Under the terms of the ESOP, the ESOP trustees vote all shares held by the ESOP, but each participant in the ESOP may direct the trustees how to vote the shares of
CORPORATE GOVERNANCE
General
The Company periodically reviews its corporate governance policies and procedures to ensure that the Company meets the highest standards of ethical conduct, reports results with accuracy and transparency, and fully complies with the laws, rules, and regulations that govethe Company's operations. As part of this periodic corporate governance review, the Board reviews and adopts best corporate governance policies and practices for the Company.
Director Independence
The Board currently consists of thirteen (13) members. All of the directors are independent under the listing standards of
Board Leadership Structure and Board's Role in Risk Oversight
Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. The Company faces a number of risks, including credit risk, interest rate risk, liquidity risk, operational risk, strategic risk, and reputation risk. Management is responsible for the day-to-day management of the risks the Company faces, while the Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk management oversight role, the Board has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed. Toward this end, the Chairperson of the Board meets regularly with management to discuss strategy and the risks facing the Company. Senior management attends the Board meetings and is available to address any questions or concerns raised by the Board on risk management and any other matters. The Chairperson of the Board and independent members of the Board work together to provide strong, independent oversight of the Company's management and affairs through the Board's standing committees and, when necessary, special meetings of independent directors.
Committees of the Board of Directors
The following table identifies our standing committees and their members. The members of the Audit, Compensation, and Nominating Committees are each independent in accordance with the relevant Nasdaq Rules. The charters of the Audit Committee, Nominating Committee, and Compensation Committee are available in the Investor Relations section of the Bank's website (www.firstharrison.com).
| Director |
Executive Committee |
Audit Committee |
Compensation Committee |
Nominating Committee |
|||||||||||
| X | X | ||||||||||||||
| X* | X | X | |||||||||||||
| X | |||||||||||||||
| X | |||||||||||||||
| X | |||||||||||||||
| X | X* | ||||||||||||||
| X | X | ||||||||||||||
| X | X | ||||||||||||||
| X | |||||||||||||||
| X | X* | X | |||||||||||||
| X | |||||||||||||||
| X | |||||||||||||||
| X | X* | X | |||||||||||||
| Number of Meetings in 2024 | 0 | 9 | 2 | 3 | |||||||||||
* Denotes Chairperson
Executive Committee. The Executive Committee evaluates issues of major importance to the Company between regularly scheduled Board meetings. The Executive Committee acts on issues delegated to it by the Board.
Audit Committee. The Board has a separately-designated standing Audit Committee established in accordance with the Securities Exchange Act of 1934, as amended (the "1934 Act"). The Audit Committee meets periodically with the Company's independent registered public accounting firm and management to review accounting, auditing, internal control structure and financial reporting matters. The Board has determined that
Compensation Committee. The Compensation Committee approves the compensation objectives for the Company and the Bank and establishes the compensation for the Chief Executive Officer and periodically reviews and makes recommendations to the Board regarding the compensation of non-employee directors. The Compensation Committee reviews all compensation components for the Company's Chief Executive Officer including base salary, annual incentives, short-term incentives, benefits and other perquisites. In addition to reviewing competitive market values, the Compensation Committee also examines the total compensation mix, pay-for-performance relationship, and how all elements, in the aggregate, comprise the Chief Executive Officers' total compensation package. Decisions by the Compensation Committee with respect to the compensation of the Chief Executive Officer are approved by the full Board, excluding any member of the Board that also serves as the Chief Executive Officer. The Compensation Committee reviews and makes recommendations to the Board with respect to any employment agreements and any severance arrangements or plans, including any benefits to be provided in connection with a change in control, for the Chief Executive Officer and other executive officers. The Compensation Committee also assists the Board in evaluating potential candidates for executive positions.
Nominating Committee. The Nominating Committee annually selects the Board's nominees for election as directors. For the procedures of the Nominating Committee, see "Nominating Committee Procedures" below.
Nominating Committee Procedures
General. It is the policy of the Nominating Committee to consider director candidates recommended by shareholders who appear qualified to serve on the Board. The Nominating Committee may choose not to consider an unsolicited recommendation if no vacancy exists on the Board and the Nominating Committee does not perceive a need to increase the size of the Board. In order to avoid the unnecessary use of the Nominating Committee's resources, the Nominating Committee will consider only those director candidates recommended in accordance with the procedures set forth below.
Procedures to be Followed by Shareholders. To submit a recommendation of a director candidate to the Nominating Committee, a shareholder should submit the following information in writing, addressed to
| 1. | The name of the person recommended as a director candidate; |
| 2. | All information relating to such person that is required to be disclosed in solicitations of proxies for election of directors pursuant to Regulation 14A under the 1934 Act, as amended; |
| 3. | The written consent of the person being recommended as a director candidate to being named in the proxy statement as a nominee and to serving as a director if elected; |
| 4. | As to the shareholder making the recommendation, the name and address, as he or she appears on the Company's books, of such shareholder; provided, however, that if the shareholder is not a registered holder of |
| 5. | A statement disclosing whether such shareholder is acting with or on behalf of any other person and, if applicable, the identity of such person. |
In order for a director candidate to be considered for nomination at the Company's annual meeting of shareholders, the Nominating Committee must receive the recommendation at least 120 calendar days before the date the Company's proxy statement was released to shareholders in connection with the previous year's annual meeting, advanced by one year.
Minimum Qualifications for Nominees. The Nominating Committee has adopted a set of criteria that it considers when it selects individuals to be nominated for election to the Board. First, a candidate must meet the age limitation requirements set forth in the Company's Bylaws. A candidate also must meet any qualification requirements set forth in any Board or committee governing documents.
The Nominating Committee will consider the following criteria in selecting nominees: financial, regulatory, and business experience; familiarity with and participation in the local community; integrity, honesty and reputation; dedication to the Company and its shareholders; independence; and any other factors the Nominating Committee deems relevant, including age, diversity, size of the Board, and regulatory disclosure obligations. The Board will also consider the extent to which the candidate helps the Board reflect the diversity of the Company's shareholders, employees, customers, and communities. The Nominating Committee also may consider the current composition of the Board, the balance of management and independent directors, and the need for audit committee expertise.
In addition, before nominating an existing director for re-election to the Board, the Nominating Committee will consider and review an existing director's Board and committee attendance and performance; length of Board service; experience, skills, and contributions that the existing director brings to the Board; and independence.
Process for Identifying and Evaluating Nominees. For purposes of identifying nominees for the Board, the Nominating Committee relies on personal contacts of the committee members and other members of the Board, as well as its knowledge of members of
In evaluating potential candidates, the Nominating Committee determines whether the candidate is eligible and qualified for service on the Board by evaluating the candidate under the selection criteria set forth above. In addition, the Nominating Committee will conduct a check of the individual's background and interview the candidate.
Board and Committee Meetings
The business of
Directors Attendance at Annual Meeting
The Board encourages directors to attend the Company's annual meeting of shareholders. All directors attended the Company's 2024 annual meeting of shareholders, except for
Code of Ethics and Business Conduct
The Company has adopted a Code of Ethics and Business Conduct (the "Code") that is designed to ensure that the Company's directors and employees meet the highest standards of ethical conduct. The Code, which applies to all employees and directors, addresses conflicts of interest, the treatment of confidential information, general employee conduct and compliance with applicable laws, rules and regulations. In addition, the Code is designed to deter wrongdoing and promote honest and ethical conduct, the avoidance of conflicts of interest, full and accurate disclosure and compliance with all applicable laws, rules and regulations.
REPORT OF THE AUDIT COMMITTEE
The Company's management is responsible for the Company's internal control over financial reporting. The independent registered public accounting firm is responsible for performing an independent audit of the Company's consolidated financial statements and issuing an opinion on the conformity of those financial statements with accounting principles generally accepted in
In this context, the Audit Committee has met and held discussions with management and the independent registered public accounting firm. Management represented to the Audit Committee that the Company's consolidated financial statements were prepared in accordance with accounting principles generally accepted in
In addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by the applicable requirements of the PCAOB and has discussed with the independent registered public accounting firm the firm's independence from the Company and its management. In concluding that the independent registered public accounting firm is independent, the Audit Committee considered, among other factors, whether the non-audit services provided by the firm were compatible with its independence.
The Audit Committee discussed with the Company's independent registered public accounting firm the overall scope and plans for their audit. The Audit Committee meets with the independent registered public accounting firm, with and without management present, to discuss the results of their examination, their evaluation of the Company's internal control over financial reporting and the overall quality of the Company's financial reporting process.
In performing all of these functions, the Audit Committee acts only in an oversight capacity. In its oversight role, the Audit Committee relies on the work and assurances of the Company's management, which has the primary responsibility for financial statements and reports, and of the independent registered public accounting firm who, in their report, expresses an opinion on the conformity of the Company's financial statements to accounting principles generally accepted in
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board, and the Board has approved, that the audited consolidated financial statements be included in the Company's Annual Report on Form 10-K for the year ended
The Audit Committee of the Board of Directors
of
DIRECTORS' COMPENSATION
The following table provides the compensation received by individuals who served as non-employee directors of the Company and the Bank during the 2024 fiscal year. The table excludes perquisites, which did not exceed
|
Fees in Cash |
Stock |
Change in Earnings (2) |
All Other Compensation (3) |
Total |
||||||||||||||||
| $ | 19,521 | $ | 2,100 | $ | - | $ | 2,812 | $ | 24,433 | |||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| 19,521 | 2,100 | 9,322 | 2,812 | 33,755 | ||||||||||||||||
| 8,097 | 2,100 | - | 648 | 10,845 | ||||||||||||||||
| 11,424 | - | - | 2,164 | 13,588 | ||||||||||||||||
| 19,521 | 2,100 | - | 2,812 | 24,433 | ||||||||||||||||
| (1) | Represents a stock award of 75 shares of restricted common stock awarded on |
| (2) | Represents above market earnings credited to the directors' deferred compensation arrangements in fiscal 2025. Only |
| (3) | Represents a bonus earned in 2024 and paid in the first quarter of 2025. |
| (4) | The compensation reported for |
Directors' Fees
For the year ending
Directors' Deferred Compensation Agreements
Effective
STOCK OWNERSHIP
| Number of Shares Owned |
Percent of Common Stock Outstanding(1) |
|||||||
| 6,090 | (2) | * | ||||||
| 2,527 | (2) | * | ||||||
| 9,337 | (3) | * | ||||||
| 820 | (2) | * | ||||||
| 17,093 | (4) | * | ||||||
| 23,925 | (5) | * | ||||||
| 3,029 | (6) | * | ||||||
| 6,017 | (9) | * | ||||||
| 775 | (2) | * | ||||||
| 5,847 | (2) | * | ||||||
| 1,260 | (10) | * | ||||||
| 52,004 | (7) | 1.55 | % | |||||
| 1,575 | (8) | * | ||||||
| 2,264 | (2) | * | ||||||
| 1,995 | (11) | * | ||||||
| All directors and executive officers as a group (15 persons) | 134,558 | 4.01 | % | |||||
*Less than 1.0%.
| (1) | Based on 3,355,353 shares of |
| (2) | Includes 225 shares of restricted stock. |
| (3) | Includes 3,670 shares allocated under the ESOP as to which |
| (4) | Includes 4,501 shares allocated under the ESOP as to which |
| (5) | Includes 225 shares of restricted stock and 10,000 shares held in the name of |
| (6) | Includes 400 shares held by the individual retirement account of |
| (7) | Includes 7,992 shares owned by Mr. |
| (8) | Includes 75 shares of restricted stock. |
| (9) | Includes 1,624 shares allocated under the ESOP as to which |
| (10) | Includes 150 shares of restricted stock |
| (11) | Includes 600 shares of restricted stock |
ITEMS TO BE VOTED ON BY SHAREHOLDERS
Item 1 - Election of Directors
The Board is divided into three (3) classes with three-year staggered terms, with approximately one-third of the directors elected each year. Four directors will be elected at the annual meeting to serve for a three-year term or until their respective successors have been elected and qualified, or their earlier resignation, removal, or death. The nominees are
The Board intends to vote the proxies solicited by it in favor of the election of the nominees named above. If any nominee is unable to serve, the persons named in the proxy card will vote your shares to approve the election of any substitute proposed by the Board. Alternatively, the Board may adopt a resolution to reduce the size of the Board. At this time, the Board does not know of any reason why any nominee might be unable to serve.
The Board of Directors recommends a vote "FOR" the election of
Information regarding the Board's nominees and the directors continuing in office is provided below. Unless otherwise stated, each individual has held his or her current occupation for the last five (5) years. The age indicated in each individual's biography is as of the date of the 2025 annual meeting. The indicated period for service as a director includes service as a director of First Harrison.
Director Nominees for Terms Ending in 2028
Directors Continuing in Office with Terms Ending in 2026
Directors Continuing in Office with Terms Ending in 2027
As a former partner in a certified public accounting firm,
Item 2 - Ratification of Independent Registered Public Accounting Firm
The Audit Committee of the Board has appointed
If the ratification of the appointment of the independent registered public accounting firm is not approved by a majority of the votes cast by shareholders at the annual meeting, the Audit Committee of the Board will consider other independent registered public accounting firms.
The Board recommends that shareholders vote "FOR" the ratification of the appointment of
Audit Fees. The following table sets forth the fees that
| 2024 | ||||
| Audit Fees (1) | $ | 381,700 | ||
| Audit-Related Fees | - | |||
| Tax Fees (2) | 30,450 | |||
| All Other Fees | - | |||
| Total | 412,150 | |||
| (1) | Includes fees billed for the audit of the consolidated financial statements, an integrated audit of internal control over financial reporting as required under Section 112 of the Federal Deposit Insurance Corporation Improvement Act (FDICIA), and the review of interim financial information contained in quarterly reports on Form 10-Q and other regulatory reports. | |
| (2) | Includes fees billed and to be billed for tax compliance services, including preparation of federal and state income tax returns, preparation of property tax returns, and tax payment and planning advice. |
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm. The Audit Committee is responsible for appointing, setting compensation and overseeing the work of the independent registered public accounting firm. In accordance with its charter, the Audit Committee approves, in advance, all audit and permissible non-audit services to be performed by the independent registered public accounting firm. This approval process ensures that the firm does not provide any non-audit services to the Company that are prohibited by law or regulation.
Item 3 - Advisory Vote on Executive Compensation
As required by federal securities laws, the Board is providing the Company's shareholders with an opportunity to provide an advisory vote on the compensation of our NEOs as disclosed pursuant to the compensation disclosure rules of the
This proposal, commonly known as a "say-on-pay" proposal, gives the Company's shareholders the opportunity to endorse or not endorse the Company's executive pay program and policies through a vote on the following resolution:
"RESOLVED, that the compensation paid to the Company's named executive officers, as disclosed pursuant to the compensation disclosure rules of the
This advisory vote on the compensation of our NEOs is not binding on us, our Board, or the Compensation Committee. However, our Board and the Compensation Committee will review and consider the outcome of this advisory vote when making future compensation decisions for our NEOs.
The Board recommends that shareholders vote "FOR" the compensation paid to the Company's named executive officers, as disclosed pursuant to the compensation disclosure rules of the
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information regarding the compensation paid, awarded to, or earned for the fiscal years ended
| Non-Equity | ||||||||||||||||||||||||
| Year | Salary (1) | Stock Awards (2)(3) |
Incentive Compensation (4) |
All Other Compensation (5) | Total | |||||||||||||||||||
| 2024 | $ | 282,666 | $ | 11,370 | $ | 30,733 | $ | 38,979 | $ | 363,748 | ||||||||||||||
| President, Chief Executive Officer | 2023 | 262,518 | 8,400 | 27,063 | 32,336 | 330,317 | ||||||||||||||||||
| 2024 | 207,333 | 11,370 | 26,587 | 25,608 | 270,898 | |||||||||||||||||||
| Chief Financial Officer | 2023 | 150,000 | 8,400 | 17,738 | 18,405 | 194,543 | ||||||||||||||||||
| 2024 | 145,133 | 11,370 | 21,611 | 35,887 | 214,001 | |||||||||||||||||||
| 2023 | 131,607 | 8,400 | 19,196 | 28,891 | 188,094 | |||||||||||||||||||
| (1) | For |
|
| (2) | Represents a stock award of 300 shares of restricted common stock to |
|
| (3) | Represents a stock award of 300 shares of restricted common stock to |
|
| (4) | The Board adopted a supplemental bonus plan under which executive officers and directors are eligible to receive cash incentives when the Bank's performance exceeds certain profitability and efficiency performance goals and thresholds (the "Bonus Plan"). Under the Bonus Plan, bonus amounts earned in 2024 were paid in the first quarter of 2025. | |
| (5) | Details of the amounts reported in the "All Other Compensation" column for 2024 are provided in the table below: |
| Frederick | Stevens | Mahuron | ||||||||||
| Employer contributions to 401(k) plan | $ | 18,166 | $ | 14,513 | $ | 10,159 | ||||||
| Health insurance | 17,886 | 8,518 | 23,451 | |||||||||
| Disability insurance | 1,065 | 1,065 | 1,065 | |||||||||
| Life insurance | 235 | 235 | 172 | |||||||||
| Dental insurance | 237 | 237 | - | |||||||||
| Vision insurance | 40 | 40 | 40 | |||||||||
| Employer contributions to health savings account | 1,000 | 1,000 | 1,000 | |||||||||
| Wellness Incentive | 350 | - | - | |||||||||
| (6) | ||
| (7) |
Outstanding Equity Awards at Fiscal Year-End
The following table sets forth information concerning outstanding stock awards as of
| Number of Shares of Stock That Have Not Vested |
Market Value of Shares of Stock That Have Not Vested |
|||||||
| 525 | $ | 16,931 | ||||||
| 450 | 14,513 | |||||||
| 300 | 9,675 | |||||||
| (1) | For |
| (2) | For |
| (3) | For |
Stock Vested in 2024
The following table sets forth information concerning the exercise of options and the vesting of stock awards in 2024 by our NEOs.
| Number of Shares Acquired on Vesting |
Value Realized on Vesting |
|||||||
| 375 | $ | 11,438 | ||||||
| 250 | 7,625 | |||||||
| (1) | Based on a closing price of |
|
| (2) | Based on a closing price of |
Accrued Pay, Certain Retirement Benefits and Vested Equity Awards
The amounts shown in the table above do not include payments and benefits to the extent they are provided on a non-discriminatory basis to salaried employees generally upon termination of employment, or amounts that are fully vested under the terms of the applicable plan, such as accrued salary and vacation pay.
Change in Control Agreements
Upon the occurrence of a change in control (as defined in the agreement) followed within twelve (12) months of the effective date of the change in control by the voluntary or involuntary termination of the executive's employment, other than for "cause" (as defined in the agreement), the executive will be entitled to certain post-termination payments and benefits. For purposes of this agreement, "voluntary termination" is limited to the circumstances in which the executive elects to voluntarily terminate his or her employment within twelve (12) months of the effective date of a change in control following any material demotion, loss of title, office or significant authority, material reduction in his or her annual compensation or benefits (other than a reduction affecting the personnel or the Bank generally), or the relocation of his or her principal place of employment by more than 25 miles from its location immediately prior to the change in control.
Under the terms of the agreements, the executive is entitled to receive, as severance pay, a sum equal to three (3) times the sum of the executive's wages, salary, bonus, and other compensation, if any, paid (including accrued amounts) by the Company or the Bank to the executive during the twelve (12) month period ending on the last day of the month preceding the effective date of the change in control. The executive is entitled to receive this payment in a lump sum no later than thirty (30) days after the date of his or her termination. In addition to a cash severance payment, the executive is also entitled to continued life, medical, dental and disability insurance coverage for twelve (12) months following termination of employment. Notwithstanding any provision in the employment agreements to the contrary, payments and benefits under the agreements are limited so that they will not constitute excess parachute payments under Section 280G of the Internal Revenue Code.
Following termination of employment for any reason, each NEO is entitled to his or her own non-forfeitable interest in the Bank's tax-qualified plans. The tax-qualified benefits are distributed in accordance with each executive's distribution election.
All payments due under the employment agreements are guaranteed by
Potential Payments Upon Termination or Change in Control
None of our executive officers are subject to any employment agreement which would entitle them to any payment upon termination of employment, absent a change in control. As is more fully described below, all of the NEOs were subject to change in control agreements with us that were in effect on
| Frederick | Stevens | Mahuron | ||||||||||
| Salary | $ | 789,434 | $ | 622,000 | $ | 435,400 | ||||||
| Bonus (1) | 181,808 | 158,410 | 130,420 | |||||||||
| Benefits (2) | 19,463 | 10,094 | 24,728 | |||||||||
| Stock Awards (3) | 16,931 | 9,675 | 14,513 | |||||||||
| Total | 1,007,636 | 800,179 | 605,061 | |||||||||
| (1) | Includes cash payments and stock awards for 2024 under the Bonus Plan and amounts contributed to the executive's 401(k) and health savings account by the Company in 2024. | |
| (2) | Consists of life, medical, dental, and disability insurance benefits. The value is based upon the type of insurance coverage the Company carried for each executive officer as of |
|
| (3) | Represents shares of common stock that would vest under the terms of the award agreements therefore. Does not include shares awarded on |
Pay vs. Performance
The Company believes that executive compensation should be structured in a way that aligns with long-term shareholder value. The following table illustrates compensation actually paid to our principal executive officer ("PEO") and other NEOs and our financial performance. The following table sets forth information required by Item 402(v) of Regulation S-K for each of the last three recently completed years, including: (i) the total compensation earned by our PEO (as reported in the Summary Compensation Table above); (ii) the compensation "actually paid" to our PEO (calculated in accordance with Regulation S-K); (iii) the average of the total compensation earned by our other NEOs (calculated based upon our Summary Compensation Table above); (iv) the average compensation "actually paid" to our other NEOs (calculated in accordance with Regulation S-K); (v) our total shareholder retu("TSR"); and (vi) our net income:
| Year | Summary Compensation Table Total for PEO ($) (1) |
Compensation Actually Paid to PEO ($) (2) |
Average Summary Compensation Table Total for non-PEO NEOs ($) (3) |
Average Compensation Actually Paid to non-PEO NEOs ($) (4) |
Value of Initial TSR ($) (5) |
Net Income ($) (6) |
|||||||||||||||||||
| 2024 | $ | 363,868 | $ | 364,127 | $ | 242,476 | $ | 242,084 | $ | 61.16 | $ | 11,940,000 | |||||||||||||
| 2023 | $ | 375,698 | $ | 376,763 | $ | 239,392 | $ | 234,847 | $ | 51.13 | $ | 12,790,000 | |||||||||||||
| 2022 | $ | 341,673 | $ | 314,068 | $ | 202,574 | $ | 174,283 | $ | 43.90 | $ | 11,902,000 | |||||||||||||
| (1) |
| (2) | 2024 | 2023 | 2022 | |||||||||
| Total Compensation as Reported in SCT | $ | 363,868 | $ | 375,698 | $ | 341,673 | ||||||
| Fair value of equity awards granted during fiscal year | (11,370 | (10,500) | - | |||||||||
| Fair value of equity compensation granted in current year at year end | 9,675 | - | - | |||||||||
| Change in fair value from end of prior fiscal year to end of current fiscal year for awards made in prior fiscal years that were unvested at end of current fiscal year | 979 | 3,600 | (19,890 | ) | ||||||||
| Change in fair value from end of prior fiscal year to vesting date for awards made in prior fiscal years that vested during current fiscal year | 975 | 7,965 | (7,715 | ) | ||||||||
| Fair value of awards forfeited in current fiscal year determined at end of prior fiscal year | - | - | - | |||||||||
| Compensation Actually Paid to PEO | $ | 364,127 | $ | 376,763 | $ | 314,068 | ||||||
| (3) | For 2022, our non-PEO NEOs consisted of |
|
(4) |
2024 | 2023 | 2022 | ||||||||||
| Total Compensation as Reported in SCT | $ | 242,476 | $ | 239,392 | $ | 202,574 | |||||||
| Fair value of equity awards granted during fiscal year | 11,370 | (8,400) | - | ||||||||||
| Fair value of equity compensation granted in current year at year end | 9,675 | - | - | ||||||||||
| Change in fair value from end of prior fiscal year to end of current fiscal year for awards made in prior fiscal years that were unvested at end of current fiscal year | 653 | 1,200 | (16,575 | ) | |||||||||
| Change in fair value from end of prior fiscal year to vesting date for awards made in prior fiscal years that vested during current fiscal year | 650 | 2,655 | (11,716 | ) | |||||||||
| Fair value of awards forfeited in current fiscal year determined at end of prior fiscal year | |||||||||||||
| Average Compensation Actually Paid to Non-PEOs | $ | 242,084 | $ | 234,847 | $ | 174,283 | |||||||
| (5) | TSR value represents the Company's cumulative TSR based on an initial |
| (6) | Net Income is calculated in accordance with accounting principles generally accepted in |
As discussed above in the Executive Compensation section of this Proxy Statement, the compensation payable to the PEO and Other NEOs consists primarily of base salary and incentive compensation in the form of performance awards as determined under the Bonus Plan. Incentive compensation under the Bonus Plan is largely determined by the pre-tax income performance of the Bank but there are provisions for the award of stock compensation if certain performance thresholds are met.
Relationship Between Compensation Actually Paid to PEO and the Average of the Compensation Actually Paid to Other Non-PEO NEOs and the Company's Cumulative TSR. From fiscal year 2022 to fiscal year 2023, the compensation actually paid to the PEO and the average of the compensation actually paid to the other Non-PEO NEOs increased by 20.0% and 34.8%, respectively. The Company's TSR increased by 16.5% over the same period. The Company attributes this difference between performance and pay at least partially to the transitions of our PEO and Non-PEO NEOs during this period which results in overlapping expenses paid to both groups. From fiscal year 2023 to fiscal year 2024, the compensation actually paid to the PEO decreased by 3.4% while the average of the compensation actually paid to the other Non-PEO NEOs increased by 3.1%. The Company's TSR increased by 19.6% over the same period.
Relationship Between Compensation Actually Paid to PEO and the Average of the Compensation Actually Paid to Other Non-PEO NEOs and the Company's Net Income. From fiscal year 2022 to fiscal year 2023, the compensation actually paid to the PEO and the average of the compensation actually paid to the other Non-PEO NEOs increased by 20.0% and 34.8%, respectively. The Company's net income increased by 7.5% over the same period. The Company attributes this difference between performance and pay at least partially to the transitions of our PEO and Non-PEO NEOs during this period which results in overlapping expenses paid to both groups. From fiscal year 2023 to fiscal year 2024, the compensation actually paid to the PEO decreased by 3.4% while the average of the compensation actually paid to the other Non-PEO NEOs increased by 3.1%. The Company's net income decreased by 6.6% over the same period.
OTHER INFORMATION RELATING TO DIRECTORS AND EXECUTIVE OFFICERS
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the 1934 Act, requires the Company's executive officers and directors, and persons who own more than 10% of any registered class of the Company's equity securities, to file reports of ownership and changes in ownership with the
Based solely on its review of the copies of the reports it has received and written representations provided to the Company from the individuals required to file the reports, the Company believes that each of its executive officers, directors and greater than 10% beneficial owners has complied with applicable reporting requirements for transactions in
Transactions with Related Persons
The Sarbanes-Oxley Act generally prohibits
The Company does not have a comprehensive written policy for the review, approval or ratification of certain transactions with related persons. However, in accordance with banking regulations, the Board reviews all loans made to a director or executive officer in an amount that, when aggregated with the amount of all other loans to such person and his or her related interests, exceeds the greater of
There are no other transactions or series of similar transactions between us and any of our directors or executive officers in which the amount involved exceeds
SUBMISSION OF BUSINESS PROPOSALS AND SHAREHOLDER NOMINATIONS
Proposals that shareholders seek to have included in the proxy statement for the Company's next annual meeting must be received by the Company no later than
The Company's Bylaws provide that, in order for a shareholder to make nominations for the election of directors or proposals for business to be brought before the annual meeting, a shareholder must deliver notice of such nominations and/or proposals to the Corporate Secretary not less than 90 nor more than 120 days before the date of the annual meeting; provided that if less than 100 days' notice of the annual meeting is given to shareholders, such notice must be delivered not later than the close of the tenth day following the day on which notice of the annual meeting was mailed to shareholders. A copy of the Bylaws may be obtained from the Company upon request.
SHAREHOLDER COMMUNICATIONS
The Company encourages shareholders to communicate with the Board and/or individual directors. Shareholders who wish to communicate with the Board or an individual director should do so in writing to
MISCELLANEOUS
The Company will pay the cost of this proxy solicitation. The Company will reimburse brokerage firms and other custodians, nominees and fiduciaries for reasonable expenses they incur in sending proxy materials to the beneficial owners of
A notice of internet availability regarding this proxy statement and the Company's Annual Report on Form 10-K has been mailed to persons who were shareholders as of the close of business on
Whether or not you plan to attend the annual meeting, please vote by marking, signing, dating and promptly returning a proxy card.
| BY ORDER OF THE BOARD OF DIRECTORS | |
| Corporate Secretary |
|
01 - |
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What happened to the April 15 income tax deadline in Florida? There's a reprieve
Proxy Statement (Form DEF 14A)
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