UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.)
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☐ | Preliminary Proxy Statement |
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☒ | Definitive Proxy Statement |
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☐ | Soliciting Material Pursuant to §240.14a-12 |
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FIRST FINANCIAL CORPORATION | |||||||
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FIRST FINANCIAL CORPORATION
One First Financial Plaza
P.O. Box 540
Terre Haute, Indiana 47808
March 14, 2018
Dear Shareholders:
Our 20182023 Annual Meeting of Shareholders will be held on Wednesday, April 18, 201819, 2023, at 11:00 a.m., local time, (EDT) (“Annual Meeting”). The Annual Meeting will be held virtually via live audio webcast on the Internet at One First Financial Plaza, Terre Haute, Indiana. www.virtualshareholdermeeting.com/THFF2023. Even though our meeting will be held virtually, shareholders will still have the ability to participate in our Annual Meeting and vote their shares at the Annual Meeting if they wish.
The formal notice of this annual meetingAnnual Meeting and the proxy statement appear on the following pages. We have also enclosed a copy of our 20172022 Annual Report on Form 10-K for your review. AfterTo ensure that your votes on the business matters of the meeting will be recorded, after reading the proxy statement and other materials,
We hope you canwill attend the meeting. Whether or not you can attend, wevirtual meeting and urge you to submitvote your proxy promptly.shares in advance. Even after submitting the proxy, you may, of course, vote in person on all matters brought before the meeting.
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Sincerely, | |
/s/ | |
Norman L. Lowery Chairman of the Board |
FIRST FINANCIAL CORPORATION
ONE FIRST FINANCIAL PLAZA
P.O. BOX 540
TERRE HAUTE, INDIANA 47808
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 18, 2018
To our Shareholders:
Notice is hereby given that, pursuant to the call of its Board of Directors (the “Board”), an Annual Meeting of Shareholders of First Financial Corporation (the “Corporation”) will be held on Wednesday, April 18, 201819, 2023, at 11:00 a.m., local time, (EDT) via a live audio webcast. You will be considered present and in person at One First Financial Plaza, Terre Haute, Indiana.
The purposes of the meeting are:
(1) | To elect |
Mark J. Blade
Gregory L. Gibson
Norman D. Lowery
Paul J. Pierson
Richard J. Shagley
(2) | To conduct a non-binding advisory vote to approve the compensation of our |
(3) | To conduct a non-binding advisory vote on the frequency of the shareholder advisory vote to approve the compensation of our Named Executive Officers; |
(4) | To ratify the appointment of Crowe |
(5) | To transact such other business as may properly be presented at the meeting or any adjournment or postponement thereof. |
The list of shareholders prepared for the Annual Meeting will be open to examination during the meeting and can be accessed at www.virtualshareholdermeeting.com/THFF2023. The list of shareholders will also be available for examination beginning five days prior to the Annual Meeting and through duration of the Annual Meeting at the headquarters of the Corporation located at One First Financial Plaza, Terre Haute, IN 47808.
Only shareholders of record at the close of business on February 26, 2018March 1, 2023, will be entitled to notice of and to vote at the meeting.
March 17, 2023 | |
By Order of the Board of Directors | |
/s/ Rodger A. McHargue | |
Chief Financial Officer and Secretary |
Important Notice Regarding the Availability of Proxy Materials for the | |
Shareholder Meeting to be Held on April | |
19, 2023: The proxy statement and annual report are available at https:// |
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FIRST FINANCIAL CORPORATION
ONE FIRST FINANCIAL PLAZA
P.O. BOX 540
TERRE HAUTE, INDIANA 47808
(812) 238-6000
PROXY STATEMENT SUMMARY
Because the following summarizes information that is further described in this Proxy Statement, we encourage you to read this document in its entirety before casting your vote. In addition, you can find frequently asked questions and their answers on page 5.
Virtual Annual Meeting
The Annual Meeting will be held virtually via a live audio webcast. There will not be a physical meeting location available for in-person participation. We believe holding our annual meeting online will facilitate greater shareholder attendance while still providing comparable rights and opportunities to participate, including the ability to ask questions, as a shareholder would have if he or she were attending our annual meeting in person.
Our 2022 Performance and Achievements
Financial Performance
Fiscal year 2022 was another year of successful financial performance, which enabled us to increase shareholder dividends for the 34th consecutive year and award a special dividend of $0.20 per share. Our 2022 reported net income was $71.1 million compared to $53 million in 2021, a 34% increase. Our diluted net income per common share of $5.82 was a 44.8% increase over the $4.02 per share reported for 2021. Return on average assets of 1.41%, compared to 1.10% reported in 2021, is a 28.2% increase.Return on average shareholder equity was 14.37%, up from 8.87% in 2021. Our efficiency ratio improved to 58.23%, compared to 61.84% achieved in 2021. Other financial highlights include:
● | Total loans outstanding of $3.07 billion as of December 31, 2022, an 8.9% increase over 2021 |
● | Total deposits of $4.4 billion, unchanged from prior year |
● | Net interest income of $165.0 million, compared to $143.4 million for 2021, a 15.09% increase |
● | Net interest margin of 3.54%, up from 3.20% in 2021 |
● | Non-interest income of $46.7 million, a 10.9% increase over the prior year amount of $42.1 million |
● | Tier one capital ratio was 13.58%, compared to 14.37% in 2021 |
Our complete financial results are reported in detail in our Form 10-K.
Branch Consolidation and Merger
In Fall 2022, we announced a branch consolidation strategy in response to the continued accelerated shift of customer banking preferences to online delivery. This initiative consolidated seven branches into other nearby locations allowing us to maintain the high level of service our customers expect while reducing operational expenses. These
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consolidations are projected to save approximately $1.5 million per year in operating expenses commencing in the second quarter of 2023.
In 2022, we also completed the merger of our wholly-owned subsidiary, The Morris Plan Company of Terre Haute, Inc. into First Financial Bank, N.A., which, among other things, took advantage of operational synergies and resultant cost-savings.
Environmental, Social and Governance (“ESG”) Matters
Our commitment to environmental, social and governance responsibility remained strong in 2022, as we made great strides and achieved success in many areas, including the following:
● | Our executive compensation program was approved by over 80% of the votes cast by our shareholders. |
● | Each of the five Directors on the ballot in 2022 was reelected, with an average of over 91% support of votes cast. |
● | We increased our minimum hourly rate of pay by approximately 30%. |
● | We hired a Diversity, Equity and Inclusion (DEI) Officer, a new position for our company. |
● | We finished 2022 with a workforce that is 77% gender or racially diverse. |
● | We partnered with Duke Energy and Willdan Group, Inc. to invest in an energy-saving program for our facilities; this investment is expected to reduce our energy usage by an estimated 350,000 kWh annually, saving us approximately $100,000 in energy costs. |
We continued to review and optimize our resources, combining seven branch locations to better meet the financial service needs of our customers while also reducing our expected energy and resource consumption. For more information on our commitment to ESG and to view our 2022 SASB disclosures, please visit www.first-online.bank/esg.
Shareholder Outreach and Engagement
We continued shareholder outreach and engagement through participation at investor conferences and in individual meetings. We met with several existing and prospective investors at the Piper-Sandler East Coast Financial Services Conference and the Raymond James U.S. Bank Conference.
Board of Directors Diversity
Reflective of our community, customers and associates, our Board continues to include members with diverse expertise in areas such as agriculture, auto lending, banking, community organizations, education, law, military, public relations, pensions and state and local government. Our Board includes two women and one African American member. Tables summarizing the diversity and experience of our Board members can be found on pages 16 and 17.
Proposal No. 1 – Election of Five Directors (pages 10 to 12)
To elect five directors for a term expiring in 2026 or until each of their successors are duly elected and qualified.
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NOMINEE | AGE | START YEAR | OCCUPATION | INDEPENDENT |
Mark J. Blade | 69 | 2020 | Served as an Indiana State Senator for the district covering the Terre Haute, Indiana area from 1997 to 2002 where he focused on economic and rural development, public education and senior citizen issues. Mr. Blade served for 19 years as a Business Development Representative of Milestone Contractors, L.P. where he focused on both public and private redevelopment projects in the greater Indianapolis area and throughout Indiana until retirement. Mr. Blade has a history of public and civic involvement, serving as a Trustee for Indiana State University as well as President of the Vigo County Council. Was a member of Rotary International for 30 years (serving as District Governor from 2015 to 2016) and serves as a Pastor of Saints’ Home Church of God in Christ, in Terre Haute, Indiana. Earned his B.S. degree from Indiana State University. | Yes |
Gregory L. Gibson | 60 | 1994 | Serves as president of ReTec Corporation, a waste management consulting business and is involved in other business ventures. Also serves on the Board of Trustees of Rose-Hulman Institute of Technology. Has also served on the Indiana Judicial Nominating Commission, as vice chairman of the Ports of Indiana Commission, as well as on the board of directors for the Methodist Health Foundation Inc. in Indianapolis. Currently serves as Chairman of the Board of the Visiting Nurses Association and Hospice of the Wabash Valley. Holds a B.S. degree from Rose-Hulman Institute of Technology. | Yes |
Norman D. Lowery | 55 | 2020 | Serves as Chief Operating Officer of the Corporation and the Bank, serving since 2010. Joined the Corporation in 1990 and has held a management position in Private Banking, as well as having been a Trust Investment Officer. Received his B.A. degree from Indiana University and a Master of Business Administration degree from Indiana Wesleyan University. Formerly held several professional accreditations, including, a Financial Industry Regulatory Authority Series 7 license; Uniform Securities Agent Series 63 license; and a Uniform Investment Adviser Series 65 license. Is also an accredited Fiduciary Investment Manager and a graduate of the Cannon Financial Institute Trust Investment School and Private Banking School. Also graduated from the ABA Stonier Graduate School of Banking. Serves as a member of the Terre Haute Chamber of Commerce’s Board of Directors. | No |
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Paul J. Pierson | 72 | 2019 | Retired after 25 years as a Circuit Judge in Sullivan County, Indiana. Previously served as a Senior Judge for the State of Indiana. Served as a Judge Advocate General Officer, retiring after 20 years of service in the United States Army and Indiana Guard, Reserve. Earned his B.S. degree from Indiana State University, engaged in graduate studies at Butler University, and earned his Doctor of Jurisprudence degree from California Western School of Law. | Yes |
Richard J. Shagley | 76 | 2020 | Admitted to the Indiana Bar in 1971, his experience includes pension plans, ERISA funds, trust funds and real estate. Also admitted to practice before the United States Supreme Court. Has a legacy of public service, serving on the Board of Trustees for Indiana State University and other civic organizations. Earned his B.S. degree from Indiana State University and his Doctor of Jurisprudence degree from Indiana University. | No |
Proposal No. 2 - Advisory Vote on Executive Compensation (Page 60)
To approve, on a non-binding advisory basis, the 2022 compensation of our CEO and other Named Executive Officers as described in this proxy statement.
● | Our CEO’s total direct compensation (base salary, annual bonus and annual stock awards) for 2022 was approximately 5.86% above 2021 total direct compensation. |
● | Total compensation for our CEO for 2022 decreased by 21.49% from total compensation reported for 2021 due to a lower pension value amount in 2022. |
Proposal No. 3 – Advisory Vote on the Frequency of Advisory Votes on Executive Compensation (page 62)
To approve, on a non-binding advisory basis, the frequency (every 1, 2, or 3 years) of holding the advisory vote on the compensation of our Named Executive Officers.
Proposal No. 4 – Ratification of Crowe LLP as Independent Auditor for 2023 (page 63)
To ratify the selection of Crowe LLP as our independent registered public accounting firm and independent auditor for 2023.
THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR EACH OF THE NOMINEES, FOR PROPOSALS 2 AND 4, AND FOR THE OPTION OF “ONE YEAR” UNDER PROPOSAL 3, AS FURTHER DESCRIBED IN THIS PROXY STATEMENT.
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Q:
Why did I receive thisYou received this proxy statement and accompanying notice of annual meeting because, as a shareholder of the Corporation, our Board of Directors (the “Board”) is soliciting your proxy to vote at the annual meetingAnnual Meeting of shareholders. The annual meetingAnnual Meeting will be held on Wednesday, April 18, 2018,19, 2023, at 11:00 a.m., local time, at One First Financial Plaza, Terre Haute, Indiana.
Q:Why is the Corporation holding the Annual Meeting virtually and how will I vote?” below, you do notbe able to participate?
We believe that allowing our shareholders to participate in the meeting online will facilitate greater shareholder attendance while still providing the same opportunity to participate, including the ability to ask questions, as a shareholder would have if he or she were attending an in-person meeting.
Any shareholder of record as of March 1, 2023, and those who hold a valid proxy from a shareholder of record can attend the Annual Meeting online at www.virtualshareholdermeeting.com/THFF2023. The live audio webcast will start at 11:00 a.m. (EDT) on April 19, 2023. You will need your 16-digit control number that is printed on your proxy card or on the instructions that accompanied your proxy materials to access the meeting. Instructions on how to attend the annualAnnual Meeting will be posted at www.virtualshareholdermeeting.com/THFF2023. We encourage you to access the meeting 15 minutes prior to the start time to allow ample time to complete the online check-in process. Further guidance on how to submit questions at the Annual Meeting and our procedures for responding to those questions also will be available on the virtual shareholder meeting log-in page.
If you encounter any technical difficulties accessing the virtual Annual Meeting during check-in or meeting time, please call the technical support number that will be posted on the virtual shareholder meeting log-in page. Further information and guidance on how to access the virtual meeting, along with how to receive assistance for any technical and logistical issues related to accessing the virtual meeting, will be available on www.virtualshareholdermeeting.com/THFF2023 in order to vote your shares.
Q:
What am I voting on?You are being asked to consider and vote on the following:
(1) | To elect each of the following nominees to the Board for a term expiring in 2026 or until his or her successor is duly elected and qualified: Mark J. Blade, Gregory L. Gibson, Norman D. Lowery, Paul J. Pierson, and Richard J. Shagley; |
(2) | To conduct a non-binding advisory vote to approve the compensation of our Named Executive Officers as described in the Proxy Statement; |
(3) | To conduct a non-binding advisory vote to approve the frequency of holding shareholder advisory votes to approve the compensation of our Named Executive Officers; and |
(4) | To ratify the appointment of Crowe LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023. |
Q:
Who is entitled to vote?Holders of our outstanding common stock as of the close of business on February 26, 2018,March 1, 2023, the record date for the Annual Meeting, are entitled to vote at the annual meeting.Annual Meeting. As of February 26, 2018, 12,255,045March 1, 2023, 12,065,888 shares of common stock were issued and outstanding, each of which entitles the holder to one vote.
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Q:What are the Board’s recommendations?
The Board recommends that you vote your shares as follows:
● | FOR the election of each of Mark J. Blade, Gregory L. Gibson, Norman D. Lowery, Paul J. Pierson, and Richard J. Shagley to the Board for a three-year term; |
● | FORthe approval, on a non-binding advisory basis, of the compensation of our Named Executive Officers; |
● | FOR the approval, on a non-binding advisory basis, of a frequency of every “ONE YEAR” to conduct advisory votes on the compensation of our Named Executive Officers; and |
● | FOR the ratification of the appointment of Crowe LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023. |
The shares represented by a properly executed and returned proxy card will be voted according to your instructions. If no instructions are provided on a signed proxy card, the persons named as proxies on your proxy card will vote in accordance with the above recommendations of the Board.
Q:
What if other matters come up during the meeting?If any matters other than those referred to in the Notice of Annual Meeting of Shareholders properly come before the meeting, the individuals named in the accompanying proxy card will vote the proxies held by them as recommended by the Board or, if no recommendation is given, in accordance with their best judgment. We are not aware of any business other than the items referred to in the Notice of Annual Meeting of Shareholders that may be considered at the meeting.
In the unlikely event that any of the director nominees becomes unable or is unwilling to serve at the time of the meeting, the persons named as proxies in the accompanying proxy card will have discretionary authority to vote for a substitute nominee named by the Governance and Nominating Committee if the Board decides to fill that nominee’s position.
Q:
Who can attend the meeting?All shareholders as of the record date or their duly appointed proxies may attend the meeting. Admission to the meeting will be on a first-come, first-admitted basis.
Q:
What constitutes a quorum?Holders of a majority of the voting power of the outstanding shares of common stock of the Corporation and entitled to vote at the Annual Meeting, represented in person or by proxy, constitute a quorum for the annual meeting.Annual Meeting. As of the record date, 12,255,04512,065,888 shares of common stock were outstanding. Proxies received but marked as abstentions and “broker non-votes” (as described below) will be included in the calculation of the number of shares considered to be present at the meeting for purposes of establishing a quorum.
Q:
How do I vote?If you hold your shares in your own name
,you may submit a proxy by telephone, by mail or via the Internet.● | Submitting a Proxy by Telephone: You can submit a proxy for your shares by telephone until 11:59 p.m. (EDT) on April 18, 2023, by calling the toll-free telephone number on the enclosed proxy card, (800) 690-6903. Telephone proxy submission is available 24 hours a day. Easy-to-follow voice prompts allow you to submit a proxy for your shares and confirm that your instructions have been properly recorded. Our telephone proxy submission procedures are designed to authenticate shareholders by using individual control numbers. |
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● | Submitting a Proxy by Mail: If you choose to submit a proxy by mail, simply mark the appropriate proxy card, date and sign it and return it in the postage paid envelope provided or to the address shown on the proxy card. |
● | Submitting a Proxy via the Internet: You can submit a proxy for your shares via the Internet until 11:59 p.m. (EDT) on April 18, 2023, by visiting the website on the enclosed proxy card, www.proxyvote.com. Internet proxy submission is available 24 hours a day. Our Internet proxy submission procedures are designed to authenticate shareholders by using individual control numbers. |
By casting your vote in any of the ways listed above, you are authorizing the individuals listed on the proxy card to vote your shares in accordance with your instructions.
You may also attend the annual meetingAnnual Meeting virtually and vote in person.
If your shares are held in the name of a bank, broker or other nominee
, you will receive instructions from the holder of record that you must follow for your shares to be voted. The availability of telephonic or Internet voting will depend on the bank’s or broker’s voting process. Please check with your bank or broker and follow the voting procedures your bank or broker provides to vote your shares. Also, please note that if the holder of record of your shares is a broker, bank or other nominee and you wish to voteIf you are a participant in the First Financial Corporation Employee Stock Ownership Plan (the “ESOP”)
, you will receive a voting instruction card to use to provide voting instructions to First Financial Bank, N.A. (the trustee of the ESOP) for the shares allocated to your account under the ESOP. Your votingQ:
If I am the beneficial owner of shares held in “street name” by my broker, will my broker automatically vote my shares for me?If the shares you own are held in “street name,” the bank, broker or other nominee will vote your shares according to your instructions. Under applicable stock exchange rules, applicableif you do not give instructions to brokers grant your broker, discretionary authoritybank or other nominees, it will still be able to vote your shares without receiving your instructions on certain matters. Your broker has discretionary voting authority under these rulesany “discretionary” items but will not be allowed to vote your shares with respect to any “non-discretionary” items without receiving voting instructions from you.
For the 2023 Annual Meeting, only on the proposal to ratify Crowe Horwath LLP as our independent registered public accounting firm.firm is considered to be a discretionary item and your broker, bank or other nominee will be able to vote on that item even if it does not receive voting instructions from you. Unless you provide voting instructions to your broker, your brokerbank or other nominee, it will not have discretionary authority to vote your shares on any of the other proposals described in this proxy statement. Therefore, it is particularly important that beneficial owners instruct their brokers, banks or other nominees on how they wish to vote their shares.
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Q:What is an “abstention” or a broker “non-vote” and how do they affect the vote?
An “abstention” occurs when a shareholder sends in a proxy with explicit instructions to decline to vote on a particular matter. Abstentions are counted as present for purposes of determining a quorum, but are not counted as votes cast and, therefore, will have no effect on the outcome of any proposal to be voted on at the annual meeting.
A broker “non-vote” occurs when a broker or other nominee who holds shares for the beneficial owner is barred from voting those shares with respect to a proposal because the broker or other nominee does not have discretionary voting power for the proposal and has not received voting instructions from the beneficial owner of the shares. Brokers will have discretionary voting power to vote shares for which no voting instructions have been provided by the beneficial owner only with respect to the ratification of Crowe Horwath LLP as our independent registered public accounting firm. Brokers will not have such discretionary voting power to vote shares with respect to any other proposal described in this proxy statement. Shares that are the subject of a broker non-vote may beare included for quorum purposes, but a broker non-vote with respect to a proposal will not be counted as a vote represented at the meetingmeeting.
Because abstentions and consequently,broker non-votes are not counted as a general matter,votes cast, they will have no effect on the outcome of any proposal to be voted on at the vote.
Yes. You may revoke your proxy or change your voting instructions at any time prior to the vote at the annual meeting by:
● | providing written notice to the Secretary of the Corporation; |
● | delivering a valid, later-dated proxy or voting by telephone or Internet at a later date, which automatically revokes your earlier proxy, either by mail, by telephone or through the Internet, if one of those methods was used for your initial proxy submission or voting instruction; or |
● | attending the Annual Meeting virtually and voting at the Annual Meeting. |
Please note that your virtual attendance at the annual meeting in personAnnual Meeting will not cause your previously granted proxy to be revoked unless you specifically so request.
Q:
What vote is required to approve each proposal?Directors will be elected by a plurality of the votes cast at the meeting. Consequently, the director nominees receiving the most votes of the holders of our common stock will be elected as directors. Only votes cast FOR
a nominee will be counted. A properly executed proxy marked “WITHHOLD AUTHORITY” with respect to the election of one or more directors will not be voted with respect to the director or directorsThe proposal for approval, on a non-binding advisory basis, of the compensation of our named executive officers will be approved if the votes cast for the proposal exceed those cast against the proposal. The proposal for the ratification of the appointment of Crowe Horwath LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2018Named Executive Officers will be approved if the votes cast for the proposal exceed those cast against the proposal. Abstentions and broker non-votes will not be counted as votes cast either for or against these proposals.this proposal and will have no effect on the outcome of the proposal.
The vote on frequency of future advisory votes on the compensation of our Named Executive Officers asks shareholders to express their preference for one of three choices: every year, every two years, or every three years. The option receiving the highest number of votes cast will be determined to be the preferred frequency. Abstentions and broker non-votes will have the same effect as not expressing a preference on this proposal.
The proposal for the ratification of the appointment of Crowe LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023, will be approved if the votes cast for the proposal exceed those cast against the proposal. Abstentions and broker non-votes will not be counted as votes cast either for or against this proposal and will have no effect on the outcome of the proposal.
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Q:Who pays to prepare, mail and solicit the proxies?
The Corporation pays all costs of preparing, mailing and soliciting proxies. The Corporation asks brokers, banks, voting trustees and other nominees and fiduciaries to forward proxy materials to the beneficial owners and to obtain authority to execute proxies. The Corporation will reimburse the brokers, banks, voting trustees and other nominees and fiduciaries upon request for their reasonable out-of-pocket costs for forwarding proxy and solicitation materials to beneficial owners of common stock. To obtain the most shareholder participation possible, we have retained Georgeson LLC to aid us in soliciting proxies for a fee of $10,000 plus reasonable out-of-pocket expenses and nominal per-holder fees for solicitation of any individual registered holders. In addition, proxies may be solicited by mail, in person, by telephone or by telephoneelectronic communication by certain of the Corporation’s officers, directors and employees who will not be separately compensated for such activity.
Q:Whom should I call with other questions?
If you have additional questions about this proxy statement or the annual meetingAnnual Meeting or would like additional copies of this document or our 20172022 Annual Report on Form 10-K, please contact: Rodger A. McHargue, Secretary, First Financial Corporation, One First Financial Plaza, P.O. Box 540, Terre Haute, Indiana 47808, (812) 238-6000.
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Our Code of By-Laws currently provides that the Board as of the 2018 annual meeting of shareholders willDirectors may consist of tennot less than 5 nor more than 20 members. Currently, there are 16 members divided into three classes of approximately equal size that are elected for staggered three-year terms. The Board believes this structure helps to maintain continuity and stability and ensures we have directors serving on theour Board who have substantial knowledge of the Corporation, all of which the Board believes facilitates long-term value for our shareholders.
Name, Age, Principal Occupation(s) and Business Experience
Nominated for a term expiring in 2021:2026:
Mark J. Blade, Age 69
Mr. Blade joined the Board in 2020 and serves on the Corporation’s Affirmative Action and Audit Committees and the Bank’s Affirmative Action, Audit, Community Reinvestment Act and Loan Committees. Mr. Blade served as an Indiana State Senator for the district covering the Terre Haute, Indiana area from 1997 to 2002 where he focused on economic and rural development, public education and senior citizen issues. Mr. Blade retired from Milestone Contractors, L.P. after 19 years of service as a Business Development Representative, focusing on both public and private redevelopment projects in the greater Indianapolis area and throughout Indiana. Mr. Blade has a history of public and civic involvement, serving as a Trustee for Indiana State University as well as President of the Vigo County Council. He was a member of Rotary International for 30 years (serving as District Governor from 2015 to 2016) and serves as a Pastor of Saints’ Home Church of God in Christ, in Terre Haute, Indiana. Mr. Blade earned his B.S. degree from Indiana State University.
As a former state senator, Mr. Blade provides the Board with a specialized view toward government and business development. Mr. Blade also brings knowledge and experience concerning issues in the Bank’s geographic footprint, serving as Pastor to the Saints’ Home Church of God in Christ of Terre Haute and having served as the district governor of Rotary International.
Gregory L. Gibson, Age 60
Mr. Gibson joined the Board in 1994 and serves on the Corporation’s Affirmative Action, Governance and Nominating, and Loan Review Committees as well as the Bank’s Affirmative Action, Investment, Loan Administration and Loan Review, Trust and Asset Management and Loan Committees. Mr. Gibson is the president of ReTec Corporation, a waste management consulting business and is involved in other business ventures. Mr. Gibson serves on the Board of Trustees of Rose-Hulman Institute of Technology. Mr. Gibson has also served on the Indiana Judicial Nominating Commission, the Ports of Indiana Commission for 17 years, as well as on the board of directors for the Methodist Health Foundation Inc. in Indianapolis. Mr. Gibson currently serves as Chairman of the Board of the Visiting Nurses Association and Hospice of the Wabash Valley. He holds a B.S. degree from Rose-Hulman Institute of Technology.
As a businessman and entrepreneur involved in a variety of business ventures, Mr. Gibson provides the Board with invaluable insight into industries and markets in which we and our clients do business. As a developer, Mr. Gibson provides counsel on market expansion. His service on various commissions, not-for-profits and boards also provides valuable political and governance perspectives.
Norman D. Lowery, Age 55
Mr. Norman D. Lowery joined the Board in 2020 and is the Chief Operating Officer of the Corporation and the Bank, serving since 2010. He joined the Corporation in 1990 and has held a management position in Private Banking, as
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well as having been a Trust Investment Officer. Mr. Lowery serves on the Corporation’s Acquisition, Asset and Liability, Cybersecurity, Data Processing and Bank Operations, Disaster Recovery, Disclosure, Enterprise Risk Management, Executive, Reserve Analysis, Records Management, Social Media and Strategic Planning Committees and Employee Benefits Sub-Committee. He also serves on the Bank’s Asset and Liability, Cybersecurity, Data Processing and Bank Operations, Disaster Recovery, Disclosure, Enterprise Risk Management, Executive, Executive Loan, Loan, Pricing, Records Management, Reserve Analysis, Social Media, Strategic Planning and Technology Committees. Mr. Lowery received a B.A. degree from Indiana University and a Master of Business Administration degree from Indiana Wesleyan University. Mr. Lowery formerly held several professional accreditations, including, a Financial Industry Regulatory Authority Series 7 license; Uniform Securities Agent Series 63 license; and a Uniform Investment Adviser Series 65 license. He is also an accredited Fiduciary Investment Manager. Mr. Lowery is a graduate of the Cannon Financial Institute Trust Investment School and Private Banking School. Mr. Lowery also graduated from the ABA Stonier Graduate School of Banking. Mr. Lowery serves as a member of the Terre Haute Chamber of Commerce’s Board of Directors.
Mr. Norman D. Lowery maintains in-depth knowledge and experience concerning the Bank’s operations, customers, and markets. His professional background and leadership role in various operational aspects, such as acquisitions and pandemic response, provide the Board with expertise and detailed internal knowledge regarding issues facing the Corporation and the Bank.
Paul J. Pierson, Age 72
Mr. Pierson joined the Board in 2019 and serves on the Corporation’s Governance and Nominating Committee and Enterprise Risk Management Committee, as well as the Bank’s Trust and Asset Management, Investment, and Loan Committees. Mr. Pierson retired after 25 years as a Circuit Judge in Sullivan County, Indiana. He previously served as a Senior Judge for the State of Indiana. Mr. Pierson also served as a Judge Advocate General Officer, retiring after 20 years of service in the United States Army and Indiana Guard, Reserve. Mr. Pierson earned his B.S. degree from Indiana State University, engaged in graduate studies at Butler University, and earned his Doctor of Jurisprudence degree from California Western School of Law.
Mr. Pierson’s history as a private practice attorney and judge provides the Board with an enhanced legal and regulatory perspective. Given our proximity to Fort Campbell and other military facilities, his long history of military service provides our board with a perspective on issues important to active-duty military and veterans. As a resident of Vanderburgh County, Indiana, Mr. Pierson provides insight concerning one of the Corporation’s growth markets.
Richard J. Shagley, Age 76
Mr. Shagley joined the Board in 2020 and serves on the Corporation’s Director’s Enterprise Risk Management and Enterprise Risk Management Committees and the Bank’s Director’s Enterprise Risk Management, Enterprise Risk Management, Investment, and Loan Committees, as well as the Bank’s Trust and Asset Management Committee. Admitted to the Indiana Bar in 1971, Mr. Shagley’s experience includes pension plans, ERISA funds, trust funds and real estate. Mr. Shagley is also admitted to practice before the United States Supreme Court. Mr. Shagley has a legacy of public service, serving on the Board of Trustees for Indiana State University and other civic organizations. Mr. Shagley earned his B.S. degree from Indiana State University and his Doctor of Jurisprudencedegree from Indiana University.
Mr. Shagley’s history of leadership on various civic boards and foundations brings the Board a valuable resource for identifying and meeting organizational issues. His specific experience with pension plans, trusts, construction and real estate issues provide insight into the business matters of our clients and our markets.
Vote Required
The director nominees will be elected by a plurality of the votes cast at the Annual Meeting. Only votes cast for a nominee will be counted, and any properly executed proxy marked “WITHHOLD AUTHORITY” with respect to the election of one or more director nominees will not be voted with respect to the nominee(s) indicated.
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OUR BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” MARK J. BLADE, GREGORY L. GIBSON, NORMAN D. LOWERY, PAUL J. PIERSON, AND RICHARD J. SHAGLEY, THE PERSONS NOMINATED BY THE GOVERNANCE AND NOMINATING COMMITTEE TO BE ELECTED AS DIRECTORS.
ADDITIONAL INFORMATION ABOUT THE BOARD OF DIRECTORS
Directors whose term expires in 2024:
Thomas T. Dinkel, Age 67
Mr. Dinkel joined the Board in 1989 and is the Chairman of the Corporation’s Audit Committee and serves on the Loan ReviewData Processing/Bank Operations and Cyber SecurityCybersecurity Committees. He also serves on the Bank’s Loan, Community Reinvestment Act Investment Services, Operations and Loan Review Committees. Mr. Dinkel has beenis currently Chairman of the Board and formally president and chief executive officer of Sycamore Engineering, Inc., Dinkel Associates Inc., Sycamore Building Corporation and Dinkel Telekom, Inc. since 1986 and has held various positions at Sycamore Engineering, Inc. since 1966. He is a licensed professional engineer in Indiana, Illinois and Florida concentrating in mechanical and electrical systems. Mr. Dinkel serves on the boardBoard of trusteesTrustees of Rose-Hulman Institute of Technology and serves as its Treasurer and is chairman of its business administration facilities and compensationfacilities committees. Additionally, he serves on the investment management (endowment), president evaluation, executive board of affairs and student affairs committees of the board of Rose-Hulman Institute of Technology. He earned his B.S. degree from Rose-Hulman Institute of Technology.
As a business owner and entrepreneur, Mr. Dinkel provides an understanding of small business which makes up much of our lending base. His vast experience as a contractor and engineer also provides us with key insights concerning our facilities and facility maintenance.
Susan M. Jensen, Age 49
Ms. Jensen joined the Board in 2021. She serves on the Corporation’s Affirmative Action Committee and Cybersecurity Committee, and the Bank’s Affirmative Action Committee, Community Reinvestment Act Committee, Cybersecurity Committee and Loan Committee. She has a long history working for community organizations. Ms. Jensen began her career as a General Assignments Reporter for WTHI in Terre Haute in October 1995 and is now the News Director and 5 p.m. Anchor for WTHI-TV and MyFOX10. She serves as Trustee for the Ohio Valley Chapter of the National Academy of Television Arts and Sciences. Her work has been recognized by the Associated Press, Society of Professional Journalists, Indiana Broadcasters Association, and the Indiana State Teachers Association. She received her B.A. in Communication from DePauw University.
Ms. Jensen’s experience in broadcast journalism and work with community organizations provides the Board with an enhanced perspective on community and public relations, as well as insight on environmental, social and governance matters.
Norman L. Lowery
, AgeMr. Norman L. Lowery joined the Board in 1989 and haswas appointed Chairman of the Board in November 2020. Prior to that, Mr. Lowery served as its Vice Chairman of the Board since 1996. He serves onas the Chairman for the Corporation’s Acquisition, Affirmative Action,Disclosure, Executive and Strategic Planning Committees and serves on the Asset/Liability, Disaster Recovery, Disclosure, Executive, Enterprise Risk Management, Loan Policy and Procedures, Loan Review, Strategic PlanningReserve Analysis, Social Media and Cyber Security Committees.Cybersecurity Committees and Employee Benefits Sub-Committee. Mr. Lowery also serves as the Chairman on the Bank’s Asset Executive, Executive Loan and Strategic Planning Committees and serves on the Asset/Liability, Community Reinvestment Act, Cybersecurity, Disaster Recovery, Disclosure, Enterprise Risk Management, Loan Administration and Loan Review, Loan Policy and Procedures, Reserve Analysis, Social Media, Technology and Loan Committees. Mr. Lowery is the Chief Executive Officer and President of the Corporation, serving in those positions since 2004 and 2013, respectively, and the Vice Chairman, President and Chief Executive Officer of the Bank, serving since 1996. Prior to joining the Corporation, Mr. Lowery was a partner in the law firm of Wright, Shagley & Lowery, P.C.,
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where he practiced for 19 years. He also served on Indiana State University’s Board of Trustees and Foundation Board. Mr. Lowery serves on the boardsboard and executive committees of Lynch Coal Operators Reciprocal Corporation, Princeton Mining Company, Inc., Deep Vein Coal Company, Inc. and the Terre Haute Area Economic Development Corporation. He is the brother-in-law of Virginia L. Smith, a current director, and father of Norman D. Lowery, the Chief Operating Officer of the Corporation and the Bank. He received a B.S. degree in Political Science from Indiana State University and a J.D.Doctor of Jurisprudence degree from Indiana University.
As President and Chief Executive Officer, Mr. Lowery is intimately familiar with our business, our customers and our employees and he provides the Board with valuable leadership, particularly through his keen insight into the industry and the markets we serve. His legal background also provides a critical element with respect to governance and regulatory issues affecting the Corporation and the Bank. Mr. Lowery also provides valuable counsel to the Board with respect to our strategic initiatives.
James O. McDonald, Age 76
Mr. McDonald joined the Board in 2020 and serves on the Corporation’s Governance and Nominating and Cybersecurity Committees and on the Bank’s Cybersecurity and Loan Committees. An active attorney for over 50 years, Mr. McDonald is an accomplished advocate on behalf of both public and private organizations, including the Vigo County School Corporation and the Terre Haute Housing Authority. He is listed as one of the Best Lawyers of America and is a member of the College of Fellows of the Indiana Trial Lawyers Association and has served as President of the Indiana Trial Lawyers Association. He served twice as a member of Indiana’s Judicial Nominating Commission, was President of the Terre Haute Bar Association and was named Lawyer of the Year by the Indiana Trial Lawyers Association and has also received its Lifetime Achievement Award. Mr. McDonald received his B.S. degree from Indiana State University and Doctor of Jurisprudence degree from Indiana University School of Law - Indianapolis.
Mr. McDonald’s experience as a trial attorney brings the Board a unique legal and practical perspective on issues that face the Corporation and the Bank. His history of legal practice with both public and private organizations offers the Board insight into the Bank’s relationship with the community, customers and government.
Thomas C. Martin, Age 72
Mr. Martin joined the Board in 2019 and serves on the Corporation’s Compensation and Employee Benefits, Director’s Enterprise Risk Management, and Enterprise Risk Management Committees as well as the Bank’s Compensation and Employee Benefits, Director’s Enterprise Risk Management, Enterprise Risk Management and Loan Committees. Mr. Martin has been involved in automotive management and has been a dealership owner since 1975. Mr. Martin currently operates numerous dealerships throughout central Indiana. Mr. Martin also owns a home interior design and furniture store since 2012. He received his B.A. degree from the University of Indianapolis. He has served and held positions on numerous professional associations and civic boards and is a board member and past Chairman of the Board of Trustees of the University of Indianapolis, serving since 1972. Mr. Martin also served as a board member of another financial institution for 12 years. Mr. Martin lives in Bloomington, Indiana, which is the location of one of our newest loan production offices.
Mr. Martin has extensive knowledge and experience in the automotive industry, which includes floor plan and indirect lending. As a businessman and entrepreneur involved in a variety of business ventures, Mr. Martin provides the Board with valuable insight into industries and markets in which we and our clients do business. His past service on the board of a financial institution provides additional perspectives concerning issues addressed by our Board.
William J. Voges
, AgeMr. Voges joined the Board in 2008 and is the Chairman of the Corporation’s Compensation and Employee Benefits Committee and serves on the Governance and Nominating Committee as well as on the Bank’s Loan Committee. Mr. Voges has servedserves on the Stetson University Board of Trustees. He serves as chairman of the board and head of trust administrationtrustee of the Root Company, a private investment company, since 2016. Prior to this, Mr. Voges served as chief executive officer and chairman of the Root Company since 1996 and as general counsel since 1990. Prior to joining the Root Company, he was a partner in the law firm of Fink, Loucks, Sweet & Voges for nine years. Mr. Voges also served on the board for Consolidated-Tomoka Land Co., a publicly traded diversified real-estate operating company (NYSE MKT: CTO), from
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2001 to 2012, where he served as Chairmanchairman from 2009 to 2011 and on the audit, executive and corporate governance committees. He also has prior experience on the boards of several financial institutions. Mr. Voges received hisa B.S. degree in Business Administration from Stetson University and his J.D.Doctor of Jurisprudence degree from Stetson University College of Law.
Mr. Voges’s past service on the boards of financial institutions provides additional perspectives of the issues facing our Board. His legal background, coupled with his leadership, audit and executive compensation experience, provides significant value on legal, governance and regulatory matters. Mr. Voges also complements the Board with his keen strategic insight.
Directors whose term expires in 2020:
W. Curtis Brighton,Age 72
Mr. Cox has served onBrighton joined the Board since 1987 andin 2004. He serves as the Chairman of the Boards of DirectorsDirector’s Enterprise Risk Management Committees of the Corporation and the Bank. He also isIn addition, Mr. Brighton serves as a member of several Corporation and Bank committees. For the Chairman of the Bank’s Trust and Asset Management Committee andCorporation, he serves on the Bank’s InvestmentAudit, Enterprise Risk Management, Executive, Loan Policy and Procedures, and Loan Committees as well asReview Committees. For the Corporation’s Governance and Nominating Committee. Mr. Cox has been a senior partner in the law firm of Cox, Zwerner, Gambill & Sullivan, LLP since 1980. He alsoBank, he serves on the boards of Hendrich Title CompanyEnterprise Risk Management, Executive, Executive Loan, Loan, and Katzenbach, Inc. As a Rose-Hulman Institute of Technology board member,Loan Policy and Procedures Committees. Mr. Cox serves on the executive committee. Mr. Cox received a B.S. degree in Physics from the Massachusetts Institute of Technology and a J.D. degree from Harvard Law School.
Mr. Brighton’s history as a private practice attorney provides the Board with an enhanced legal and regulatory perspective. As a businessman providing leadership to companies with varied commercial interests, Mr. Brighton provides insight into the industries and markets in which we and our clients do business.
Michael A. Carty, Age 72
Mr. Carty joined the Board in 2020 and serves on the Corporation’s Audit Committee as well as the Bank’s Investment, Loan, Trust and Asset Management Committees. A licensed CPA for over 30 years, Mr. Carty has vast experience and knowledge involving fiscal responsibility, auditing, accounting and banking, and has been determined by the Board to qualify as an “audit committee financial expert” as defined under the rules of the Securities and Exchange Commission (“SEC”). Mr. Carty served on the Board of Directors of Centier Bank from 2012–2016, where he served on their audit, investment, loan and compensation committees. Mr. Carty also served as the Corporation’s Senior Vice President, Secretary and Chief Financial Officer from 1976 until his retirement in 2010.Mr. Carty served on the Vermillion County, Indiana, Council from 2008 to 2020. Mr. Carty earned his B.S. degree in Accounting from Indiana State University.
Mr. Carty’s career in accounting, banking, fiscal oversight, and auditing provides the Board with expertise in those areas and his qualifications as a CPA, and as a former CFO of the Corporation, give Mr. Carty firsthand and detailed knowledge of the Bank’s customers, operations, and markets.
William R. Krieble
,AgeMr. Krieble joined the Board in 2009 and serves on the Bank’s Affirmative Action, Compensation and Employee Benefits, Cybersecurity, Director’s Enterprise Risk Management, Enterprise Risk Management, Loan and Community Reinvestment Act Committees. Mr. Krieble also serves on the Corporation’s Compensation and Employee Benefits, Director’s Enterprise Risk Management, Enterprise Risk Management, Affirmative Action and Cyber Security Cybersecurity
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Committees. Mr. Krieble retired after 41 years of service to the State of Indiana where he most
Mr. Krieble’s years of long service to the State of Indiana provides the Board with valuable political and governmental perspectives. He has extensive history of work with charitable and human service organizations addressing human service issues including the disabled and disadvantaged.
Tina J. Maher, Age 75
Ms. Maher joined the Board in 2019 and serves on the Corporation’s Affirmative Action Committee, Audit Committee and the Bank’s Affirmative Action, Audit and Loan Committees. Ms. Maher retired from the Vigo County School Corporation. Ms. Maher is Principal of Maher Farms. Since 1985 she has maintained the financial records for Maher Law Office and Maher Farms. Ms. Maher received her B.S. and M.S. degrees from Indiana University. Ms. Maher has served on numerous not-for-profit boards and held several positions including chairperson, secretary and treasurer.
Due to our extensive farm lending program, Ms. Maher provides the Board with valuable insight regarding issues facing farmers and the agricultural industry. Also, as a female business owner, Ms. Maher provides important perspectives on women-owned businesses. She also has extensive civic and charitable service.
Ronald K. Rich
,AgeMr. Rich joined the Board in 2005 and serves as the Chairman of the Corporation’s Governance and Nominating Committee.Committee as well as the Corporation’s lead independent director. He is a member of the Corporation’s Compensation and Employee Benefits, Executive, Director’s Enterprise Risk Management and Enterprise Risk Management Committees. Mr. Rich also is a member of the Bank’s Compensation and Employee Benefits, Executive, Director’s Enterprise Risk Management and Enterprise Risk Management and Loan Committee.Committees. Mr. Rich also serves as the Lead Independent Director. Mr. Rich retiredformerly served as a financial representative for Northwestern Mutual Financial Network with 54 years of service.Network. He holds Chartered Life Underwriter and Chartered Financial Consultant designations from The American College of Financial Services.
Mr. Rich’s long service in the financial and insurance industries brings specific knowledge of matters affecting the Corporation’s insurance matters. He has served as the Corporation’s lead independent director since 2005. Mr. Rich also possesses valuable insight regarding our markets and our various client bases.
Board of Directors
The Governance and Nominating Committee believes that well-functioning boards consist of a diverse collection of individuals that bring a variety of complementary skills. Although the Board does not have a formal policy with regard to the consideration of diversity in identifying directors, diversity is one of the factors that the Governance and Nominating Committee may, pursuant to its committee charter, take into account in identifying director candidates. The Governance and Nominating Committee generally considers each director eligible for nomination in the broad context of the overall composition of our Board with a view toward constituting a Board that, as a body, possesses the demonstrated senior leadership and management experience to oversee our business. TheHistorically the Governance and Nominating Committee has historically sought directors that bring broad and varied skills and knowledge from retail and wholesale businesses, not-for-profits, legal, financial and government. Thegovernment services. As illustrated by the substantial Board refreshment and as further discussed in this proxy statement’s Corporation Governance section beginning on page 23, the Board has affirmed its commitment to seeking membership with diversity of experience, qualifications, attributes, or skills that ledand skills.
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The following matrix summarizes the Governancegender and Nominating Committee to conclude that eachdemographic diversity of the members of the Board:
Board Diversity Matrix (As of March 17, 2023) | ||||
Total Number of Directors: | 16 | |||
| Female | Male | Non- | Did Not |
Part I: Gender Identity | ||||
Directors | 2 | 14 | – | – |
Part II: Demographic Background | ||||
African American or Black | – | 1 | – | – |
Alaskan Native or Native American | – | – | – | – |
Asian | – | – | – | – |
Hispanic or Latinx | – | – | – | – |
Native Hawaiian or Pacific Islander | – | – | – | – |
White | 2 | 13 | – | – |
Two or More Races or Ethnicities | – | – | – | – |
LGBTQ+ | – | – | – | – |
Did Not Disclose Demographic Background | – | – | – | – |
Board nominated by the Governance and Nominating Committee should serve on the Board are generally described below:
During the year ended December 31, 2017,2022, the Board met 1817 times. Each director attended more than 75% of the aggregate of (i) all meetings of the Corporation Board and Bank board held while he or she was a director and (ii) all meetings of Corporation and Bank committees on which he or she served during the period that he or she served on the committee. Although the Corporation has no formal policy on director attendance at annual meetingsAnnual Meetings of shareholders,Shareholders, they are encouraged to attend such meetings. All directors on the Board at that time attended the 20172022 Annual Meeting of Shareholders.
The Board has established a number of committees that facilitate the administration and oversight of the Corporation. Among these committees are the Governance and Nominating, Audit, and Compensation and Employee Benefits Committees.
The following matrix indicates the composition of those committees as of the date of this proxy statement. Our Directors’ primary qualifications and attributes are also highlighted in the following matrix. The matrix is intended as a high-level summary and not an exhaustive list of each Director’s skills or contributions to the Board.
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| ||||||||||||||||
| Mark Blade | Curtis Brighton | Michael Carty | Thomas Dinkel | Gregory Gibson | Susan Jensen | William Krieble | Norman D. Lowery | Norman L. Lowery | Tina Maher | Thomas Martin | James McDonald | Paul Pierson | Ronald Rich | Richard Shagley | William Voges |
Committees | ||||||||||||||||
Governance and Nominating | * | * | * | * | * | |||||||||||
Audit | * | * | * | * | | | | | | * | | | | | | |
Compensation and Employee Benefits | | | | | | | * | | | | * | | | * | | * |
Knowledge, Skills and Experience | | | | | | | | | | | | | | | | |
Academia/Education | * | * | * | * | * | * | * | * | ||||||||
Accounting | * | |||||||||||||||
Agriculture | | | | | | | | | | * | | * | * | | | |
Audit | * | * | * | * | | | | | | * | | | | | | * |
Auto Sales/Lending | | | | | | | | | | | * | | | | | |
Compensation and Employee Benefits | * | * | * | * | * | * | ||||||||||
Corporate Governance/Ethics | * | * | * | * | * | * | ||||||||||
Entrepreneurship | | | | * | * | | | | | * | * | | | | | |
Executive | * | * | * | * | * | * | * | |||||||||
Financial | * | * | * | * | * | |||||||||||
Insurance | | | | | | | | | * | | | | | * | | |
Investment | | | | * | | | | * | | | | | | * | | * |
Legal/Regulatory | | * | | | | | | * | * | | | * | * | | * | * |
Legislative/Political | * | | * | | * | | * | | | | | | | | | |
Mergers and Acquisitions | * | * | ||||||||||||||
Military | | | | | | | | | | | | | * | | | |
Nonprofit | * | * | | | * | * | * | * | * | * | * | * | | | * | |
Operations | * | * | ||||||||||||||
Real Estate | | | | | * | | | | | | * | | | | * | |
Public Relations | | | | | | * | | | | | | | | | | |
Risk Management | | | | | | | | * | * | | | | | | | |
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Strategic Planning/Oversight | * | * |
Governance and Nominating Committee. Members consist of B. Guille Cox, Jr., Gregory L. Gibson, Ronald K. Rich (Chairman) and, Paul J. Pierson, William J. Voges. Voges, and James O. McDonald.The Board has determined that Messrs. Cox, Gibson, Rich, Pierson, Voges and VogesMcDonald are independent under the rules of the NASDAQ Global Select Market. The Governance and Nominating Committee met three times during 2017.
The primary objectives of the Governance and Nominating Committee are to assist the Board in developing and recommending corporate governance policies and guidelines for the Corporation andin addition to identifying, evaluating and nominating persons for election to the Board and appointment to the committees of the Board. A copy of the Governance and Nominating Committee Charter is available on the Corporation’s web sitewebsite at
Audit Committee
.Members consist of W. Curtis Brighton, Thomas T. Dinkel (Chairman), Tina J. Maher, Mark J. Blade, andThe Board has determined that none of its members currently meets the definition of an “audit committee financial expert” under federal securities laws. To be considered an “audit committee financial expert,” an individual’s past experience generally should include experience in the preparation or audit of comparable public company financial statements, or the supervision of someone in the preparation or audit of comparable public company financial statements. The Board has determined that in order to best fulfill the functions of our Board and our Audit Committee, each member of the Board and the Audit Committee should ideally understand community banking and the local markets in which the Corporation and the Bank do business. Accordingly, potential candidates who have such attributes in addition to having the experience the Board believes is necessary to qualify as “audit committee financial experts” are limited. Further, the Board believes that the addition of an “audit committee financial expert” is not necessary at this time given the level of financial knowledge and experience the current membersprimary objectives of the Audit Committee possess.
● | The integrity of our financial statements; |
● | The qualifications and independence of our independent registered public accounting firm; |
● | The performance of our internal audit function and independent registered public accountants; |
● | Our compliance with certain applicable legal and regulatory requirements; and |
● | Our system of disclosure controls and system of internal controls regarding finance, accounting and legal compliance. |
In addition, among other responsibilities, the Audit Committee reviews the Corporation’s accounting functions, the adequacy and effectiveness of the internal controls and internal auditing methods and procedures. A copy of the Audit Committee charter is available on the Corporation’s website at www.first-online.bank on the “Investor Relations” page of the website under the link “Governance Documents.”
Compensation and Employee Benefits Committee
.Members consist ofThe primary objective of the Compensation and Employee Benefits Committee is to review and approve the Corporation’s compensation strategy and the compensation of our executive officers and senior management. In addition, among other responsibilities, the Compensation and Employee Benefits Committee establishes guidelines and oversees the administration of executive compensation plans and arrangements, as well as certain employee benefit plans. A copy of the charter of the Compensation and Employee Benefits Committee is available on the Corporation’s website at
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The goal of our director compensation package is to attract and retain qualified candidates to serve on the Board. In setting compensation, the Board considers compensation levels of directors of other financial institutions of similar size. Each director of the Corporation is also a director of First Financial Bank, N.A. (the “Bank”), the lead subsidiary bank of the Corporation. The non-employee directors receive director fees from both the Corporation and the Bank. During 2017, nonemployee2022, non-employee directors received a $40,000 retainer from the Corporation and a $5,000 retainer from the Bank. During 2017,2022, each non-employee director of the Corporation and the Bank received a fee of $750 for each board meeting attended for the Corporation or the Bank. In addition, Mr. Cox received a fee of $5,000 in connection with his services as Chairman of the Board.
Non-employee directors also receive a fee for each meeting attended of the Audit Committee of $1,000, the Compensation and Employee Benefits Committee of $1,000, the Governance and Nominating Committee of $500$1,000 and the Loan Committee of the Bank of $500. No non-employee director served as a director of any other subsidiary of the Corporation.
Employee directors receive no compensation for their service on the boards or board committees of the Corporation and the Bank.
The table below summarizes the compensation paid by the Corporation to each non-employee director for service during the fiscal year ended December 31, 2017.
Fees Earned or | ||||||||||
Name | Paid in Cash | Total | ||||||||
W. Curtis Brighton | $ | 82,500 | $ | 82,500 | ||||||
B. Guille Cox | 84,000 | 84,000 | ||||||||
Thomas Dinkel | 82,250 | 82,250 | ||||||||
Anton H. George | 81,500 | 81,500 | ||||||||
Gregory L. Gibson | 76,000 | 76,000 | ||||||||
William H. Krieble | 81,000 | 81,000 | ||||||||
Ronald K. Rich | 81,000 | 81,000 | ||||||||
Virginia L. Smith | 69,500 | 69,500 | ||||||||
William J. Voges | 81,500 | 81,500 |
Name | Fees Earned or Paid in Cash | Total |
---|---|---|
Mark J. Blade | $80,500 | $80,500 |
W. Curtis Brighton | 80,500 | 80,500 |
Michael A. Carty | 80,500 | 80,500 |
Thomas T. Dinkel | 80,500 | 80,500 |
Gregory L. Gibson | 79,500 | 79,500 |
William R. Krieble | 81,500 | 81,500 |
Susan M. Jensen | 76,500 | 76,500 |
Tina J. Maher | 80,500 | 80,500 |
Thomas C. Martin | 81,500 | 81,500 |
James O. McDonald | 79,500 | 79,500 |
Paul J. Pierson | 79,500 | 79,500 |
Ronald K. Rich | 84,500 | 84,500 |
Richard J. Shagley | 76,500 | 76,500 |
William J. Voges | 84,500 | 84,500 |
___________
First Financial Corporation Directors’ Deferred Compensation Plan
. Prior to 2011, directors of the Corporation and the Bank were permitted to participate in a directors’ deferred compensation plan. Under the plan, a director could elect to defer up to $6,000 of his or her director’s fees each year over a five-year period. The amount of deferred fees was used to purchase an insurance product, of which the Corporation is the beneficiary, that funds benefit payments. An amount equal to the face amount of the policy, in addition to an amount equal to the tax savings the Corporation will receive by obtaining the proceeds from the policy on a tax-free basis, will be paid to the director or his or her beneficiary. Payment will be made to the director or his or her beneficiary in 120 monthly installments beginning on the first day of the month after the earlier of the director’s 65th birthday or death. Each year from the initial date of deferral until payments begin, the Corporation accrues a non-cash expense, which will equal, in the aggregate, the amount of the payments to be made to the director over the ten-year period. For19
amounts under this plan and those directors who have attained age 65 received payments attributable to previously-deferredpreviously deferred amounts under the plan in the following amounts: Mr. Brighton – $59,642, Mr. Dinkel -– $54,000, Mr. Krieble -– $10,363, and Mr. Norman L. Lowery - $142,414 and Ms. Smith - $74,914.
The Board believes that directors more effectively represent the Corporation’s shareholders if they are shareholders themselves. Therefore, the Board has adopted stock ownership guidelines applicable to all directors, other than Norman L. Lowery, President and CEO, and Norman D. Lowery, COO, who isare subject to the stock ownership guidelines for executive officers discussed under “Compensation Discussion and Analysis.” Under the guidelines, directors must own a number of shares of the Corporation’s common stock equal in value to three times their annual Corporation retainer for services as a director. Additionally, directors may not dispose of shares of Corporation stock until they have satisfied the guidelines. Directors are expected to be in compliance with the stock ownership guidelines not later than five years after the date of their initial election or appointment as a director of the Corporation. In the case of individuals who were directors when the current guidelines became effective, compliance was required by February 21, 2017. All nine of our non-employee directors have met their stock ownership levels under these guidelines.
None of the members of the Compensation and Employee Benefits Committee was or is an officer or employee of the Corporation and no executive officer of the Corporation served or serves on the compensation committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire board of directors) or on the board of directors of any company that employed or employs any member of the Corporation’s Compensation and Employee Benefits Committee. In addition, no executive officer of the Corporation served or serves on the compensation committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire board of directors) of any company one of whose executive officers serves on our Board, except for Norman L. Lowery, our President and Chief Executive Officer, and Norman D. Lowery, our Chief Operating Officer, who are members of the board of directors of Princeton Mining Company, Inc. and Deep Vein Coal Company, Inc. for which Virginia Smith, one of our directors, served as President during a portion of 2017.
The Audit Committee is responsible for approving any transactions between the Corporation or its subsidiaries and any related party, including loans or extensions of credit to the subsidiaries and any sale of assets or other financial transactions. Directors and executive officers of the Corporation and their associates were customers of, and have had transactions with, the Corporation and its subsidiaries in the ordinary course of business during 2017.2022. Comparable transactions may be expected to take place in the future. During 2017,2022, various directors and executive officers of the Corporation and their respective associates were indebted to the subsidiary banks from time to time. These loans were made in the ordinary course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for similar transactions with other persons not related to the Corporation and did not involve more than the normal risk of collectability or present other unfavorable features. Loans made to directors and executive officers that are subject to federal banking regulations are exempt from the insider loan prohibitions included in the Sarbanes-Oxley Act of 2002.
Related party transactions are evaluated on a case-by-case basis in accordance with the applicable provisions of the Articles of Incorporation and the Code of Business Conduct and Ethics of the Corporation (the “Code of Ethics”).
The provisions of the Articles of Incorporation apply to contracts or transactions between the Corporation and (i) any director; or (ii) any corporation, unincorporated association, business trust, estate, partnership, trust, joint venture, individual or other legal entity in which any director has a material financial interest or of which any director is a director, officer or trustee. The provisions of the Code of Business Conduct and Ethics apply to the directors, officers and employees of the Corporation.
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The Articles of Incorporation provide that a contract or transaction between the Corporation and any of the persons described above is valid for all purposes if the material facts of the contract or transaction and the director’s interest were disclosed or known to the Board, a committee of the Board with authority to act thereon or the shareholders entitled to vote thereon and the Board, such committee or such shareholders authorized, approved or ratified the contract or transaction.
The Code of Business Conduct and Ethics provides that directors, officers and employees of the Corporation must make business decisions for the Corporation free of conflicting influences. Such persons are expected to avoid situations that may lead to real or apparent material conflicts between such person’s self-interest and such person’s duties or responsibilities as a director, officer or employee of the Corporation. The senior compliance officerChief Compliance Officer is responsible for annually reaffirming compliance with the Code of Business Conduct and Ethics by the directors, officers and employees of the Corporation.
Certain family relationships exist among the executive officers of the Corporation. Norman L. Lowery (the Chairman, President and Chief Executive Officer of the Corporation and the Bank) is the father of Norman D. Lowery (Director and the Chief Operating Officer of the Corporation and the Bank). There are no arrangements or understandings between any of the directors and executive officers pursuant to which any of them has been selected for their respective positions.
A son of Norman D. Lowery is employed by the Bank as a senior attorney, and Mr. Lowery’s wife is employed by the Bank as Vice President, Director of Branch Banking. In such capacities, each has received salary, benefits and other compensation since January 1, 2022 in excess of $120,000. In each case, such amounts are consistent with that of similarly situated employees with equivalent qualifications and responsibilities, and their compensation terms are established independent of their familial relationships. A son of Richard J. Shagley is a partner in a law firm that, during 2022, received approximately $246,475 in legal and contingency fees for collections cases and other litigated matters from the Bank.
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The name, age, position and business experience of each named executive officer who is not a member of the Board is described below:
Rodger A. McHargue
, AgeMr. McHargue is the Chief Financial Officer of the Corporation and the Bank and also the Secretary and Treasurer of the Corporation, serving since 2010. He joined the Corporation in 1994. Prior to that, Mr. McHargue was employed at Bank One Indianapolis for over six years. He received a B.S. degree in Economics and Finance from Indiana State University and an M.B.A.a Master of Business Administration degree from Indiana State University. He is also a graduate of the ABA Stonier Graduate School of Banking.
Steven H. Holliday
, AgeMr. Holliday is the Chief Credit Officer of the Corporation and the Bank, serving since 2012. Prior to joining the Corporation, Mr. Holliday was a Senior Vice President and Commercial Lending Executive at Old National Bancorp. Mr. Holliday received his B.S. degree in Business from Indiana State University and an M.B.A.a Master of Business Administration degree from the University of Illinois. He holds a Credit Risk Certification designation through The Risk Management Association and is a graduate of Southern Illinois University School of Banking.
Mark A. Franklin, Age 50
Mr. LoweryFranklin is the Chief OperationsLending Officer of the Corporation and the Bank, serving since 2010.February 2022. He joined the CorporationBank in 1990 and has heldJanuary 2020 as Senior Commercial Lending Executive for the Indianapolis Region. Prior to joining the Bank, he served as a management position in Private Banking, as well as having beenRegion President for German American Bank from February 2009 to December 2019. He received a Trust Investment Officer. Mr. Lowery received his B.A.B.S. degree from the University of Southern Indiana University and M.B.A.an M.A. degree from Indiana WesleyanBall State University. Mr. Lowery holds several professional accreditations, including, a Financial Industry Regulatory Authority Series 7 license; Uniform Securities Agent Series 63 license; and a Uniform Investment Adviser Series 65 license. He is also an Accredited Fiduciary Investment Manager. Mr. Lowery is a graduate of the Cannon Financial Institute Trust Investment School and Private Banking School. Mr. Lowery also graduated from the ABA Stonier Graduate School of Banking.Banking and holds a Credit Risk Certification designation through The Risk Management Association.
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The Corporation aspires to the highest ethical standards for its employees, officers and directors and remains committed to the interests of its shareholders. The Corporation believes it can achieve these objectives with a plan for corporate governance that clearly defines responsibilities, sets high standards of conduct and promotes compliance with the law. The Board has adopted policies and procedures designed to foster the appropriateTo maintain a level of corporate governance. Certaingovernance that is commensurate with contemporary risks, the Board updated various policies, procedures and committee charters in 2020, which are reaffirmed annually, including, but not limited to, the Code of these policiesBusiness Conduct and procedures are discussed below.
Consideration of Director Candidates
Pursuant to our Corporate Governance Guidelines, the Board is formally committed to seeking individuals of high personal and professional integrity who have the characteristics, skills, and experiences to meaningfully contribute to sound business leadership of the Corporation. The Board values diverse perspectives and believes varied skills, knowledge and experiences contribute to robust discussions and thorough analysis of matters presented at its meetings.
To this end, the Board has tasked the Governance and Nominating Committee with ongoing consideration of the evolving needs of the Board andas it searches for candidates who will fill any current or anticipated gaps. The Governance and Nominating Committee generally considers, among other matters, aevaluates the entirety of each candidate’s experience, skills, expertise, diversity, personalcredentials and professional integrity, character, business judgment, time availableconsideration must be given to serve, dedication, conflicts of interest and ability to overseeat least the Corporation’s business and affairs. following qualifications:
● | Personal and professional integrity; |
● | Character; |
● | Business judgment; |
● | Skills; |
● | Expertise; |
● | Dedication and background; |
● | Diversity with respect to gender, race, ethnicity and experience; |
● | Time availability to serve in light of other commitments; and |
● | Conflicts of interest. |
The Governance and Nominating Committee does not havemust ensure that the initial list of candidates from which new nominees are chosen includes qualified individuals with a formal diversity policy; however, both the Board and the Governance and Nominating Committee believe it essential that Board members represent diverse experiences and viewpoints. The Governance and Nominating Committee considers the
In keeping with the Board’s directives, over the past three years, the Governance and Nominating Committee led a substantial effort to refresh the Board’s membership. As a result, nine new directors were added to the Board, including one who was added in 2021. These new members bring to the Board gender and racial diversity and, with backgrounds in law, the military, agriculture, education, the automobile industry, government, public relations, and financial services, these new directors complement the Board’s prior-existing qualifications.
Board Leadership Structure and Lead Independent Director
Our Board regularly reviews and assesses the effectiveness of our leadership structure and will implement any changes as it deems appropriate. In February 2013,
Our Corporate Governance Guidelines do not have a fixed policy regarding the separation of the offices of Chairman and Chief Executive Officer, which provides the Board establishedwith flexibility to react to evolving circumstances and
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select from time to time the sizeBoard leadership structure it deems to be in the best interests of the Board at ten, effectiveCorporation and its shareholders.
Norman L. Lowery serves as of the 2013 annual meeting of shareholders.
Our Board has an active role, as a whole and also at the committee level, in overseeing management of the Corporation’s risks. The Board regularly reviews information regarding the Corporation’s financial results, operations and liquidity, as well as the risks associated with each.
Audit Committee
The Audit Committee oversees management of the Corporation’s financial risks, including the oversight of our internal audit function, our internal controls over financial reporting and our disclosure controls and procedures and our management of potential conflicts of interest.
Compensation and Employee Benefits Committee
The Compensation and Employee Benefits Committee is responsible for overseeing the management of risks relating to the Corporation’s executive compensation plans and arrangements. Among other things, this committee oversees the administration and operation of retirement, ESOP and 401(k) plans as well as the performance-based Amended and Restated 2011 Omnibus Equity Incentive Plan (“LTIP” or “2011 EIP”) and the 2011 Short-Term Incentive Compensation Plan (“STIP” or “2011 STIP”).
Governance and Nominating Committee
The Governance and Nominating Committee manages risks associated with the independence of the Board.
Enterprise Risk Management
The Director’s Enterprise Risk Management Committee and the Enterprise Risk Management Committee advise and assist the Board in its oversight and management of enterprise risk. The Enterprise Risk Management Committee is composed of Board members W. Curtis Brighton, William R. Krieble and Ronald K. Rich, the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer, the Chief Credit Officer, Chief Risk Officer, the Chief Compliance Officer, the Chief Branch Banking Officer, the heads of Operations, Human Resources, Loan Review, Auditing, Information Technology, General Counsel, the Security Officer, the Chief Information Security Officer, and a representative from our subsidiary The Morris Plan Company of Terre Haute. The Director’s Enterprise Risk Management Committee is composed of Board members W. Curtis Brighton (Chairman), William R. Krieble, and Ronald K. Rich, who are responsible for, among other matters, coordinating risk management issues with other Board and management levelThese committees as well as establishing and maintaining effective policies, procedures and practices for identifying, measuring and mitigating enterprise risk. The Enterprise Risk Management Committee and the Director’s Enterprise Risk Management Committee receive regular reports from management and meet no less frequently than quarterly to discuss matters relating to the management of the various components of enterprise risk, including credit, interest rate, liquidity, compliance, technology, transaction, reputation and strategic risks. The Director’s Enterprise Risk Management Committee is composed of W. Curtis Brighton (Chairman), William R. Krieble, Thomas C. Martin, Paul J. Pierson, Ronald K. Rich, and Richard J. Shagley, all of whom are responsible for, by way of example not limitation, coordinating risk management issues with other Board and management-level committees as well as establishing and maintaining effective policies, procedures and practices for identifying, measuring and mitigating enterprise risk. Our management-level Enterprise Risk Management Committee is composed of the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Chief Credit Officer, Chief Lending Officer, Chief Risk Officer (Chairman), Chief Compliance Officer, Director of Branch Banking,
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Chief Information and Operations Officer, Chief Information Security Officer, General Counsel, Director of Human Resources, Director of Internal Audit, Loan Review Manager, Security Officer, and Senior Operations Manager.
Cybersecurity
The Corporation’s and the Bank’s CyberCybersecurity Committees, which are led by the Chief Information Security CommitteesOfficer (“CISO”), evaluate and oversee the management of risks relating to our information technology infrastructure. infrastructure and oversee implementation of the Corporation’s Information Security Program. Members of these committees include Messrs. Dinkel, Krieble and McDonald, Ms. Jensen, independent members of the Board, as well as Norman L. Lowery, our Chief Executive Officer and Board member and Norman D. Lowery, our Chief Operating Officer and Board member, and members of the Incident Response Team, which is a multi-departmental group responsible for addressing unauthorized use or access to confidential information in accord with the Corporation’s Incident Response Plan. Since November 2020, the Corporation and the Bank have operated under a single, integrated Information Security Policy to enhance our cybersecurity efforts. Under the Information Security Policy, the CISO continues to report directly to the Board no less than quarterly regarding cybersecurity threats, technology-related community outreach and internal cyber defenses, including, but not limited to, the results of independent third-party and internal information security audits, associate training, regular newsletters, penetration testing and other breach-prevention efforts. In addition, the CISO reports to the Board annually, providing a retrospective cybersecurity briefing of the previous year. The Corporation has procured cyber liability insurance, regularly trains associates and provides community outreach regarding cybersecurity precautions and threats and annually audits the Information Security Program.
Community Reinvestment and Fair Lending
The Corporation’s and the Bank’s CRA and Fair Lending Committees evaluateare integral to balancing sustainability efforts with safe and overseesound business practices. The CRA Committee evaluates and oversees the management of risks relating to our compliance with the Community Reinvestment Act. The Bank’s Fair Lending Committee evaluates and oversees the management of risks relating to our lending policies and practices.
While each committee is responsible for evaluating certain risks and overseeing the management of these risks, the entire Board is regularly informed about such risks through committee reports.
The Board has determined that a majority of theall current members of the Board including Messrs. Cox, Krieble, Rich, George, Dinkel, Voges, Brightonexcept Norman L. Lowery, Norman D. Lowery, and Gibson,Richard J. Shagley are independent, as independence is defined under revisedthe listing standards of the NASDAQ Global Select Market applicable to the Corporation.
The Board has adopted Corporate Governance Guidelines containing general principles regarding the functions of the Board and its committees. The Governance and Nominating Committee periodically reviews the Corporate Governance Guidelines and will recommend changes to the Board as it deems appropriate. A copy of the Corporate Governance Guidelines is available on the Corporation’s website at
We have a Code of Business Conduct and Ethics (the “Code of Ethics”) that applies to all of the Corporation’s directors, officers, and employees, including its principal executive officer, principal financial officer, principal accounting officer and controller. The Corporation intends to disclosediscloses any amendments to the Code of Business Conduct and Ethics by posting such amendments on its website. In addition, any waivers of the Code of Business Conduct and Ethics for directors or executive officers of the Corporation will be disclosed in a report on Form 8-K filed with the SEC. Consistent with
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historical performance, there were no waivers in 2022. A copy of the Code of Business Conduct and Ethics is available on the Corporation’s web sitewebsite at www.first-online.comwww.first-online.bank on the “Investor Relations” page of the “About Us” section of the website under the link “Governance Documents.”
Anti-Hedging and Anti-Pledging Policy
Hedging and similar monetization transactions by a director or an executive officer can lead to a misalignment between the objectives of that director or executive officer and the objectives of our shareholders. Accordingly, all directors, officers and employees are prohibited from engaging in hedging or monetization transactions with respect to the securities of the Corporation. In addition, our Insider Trading Policy includes an anti-pledging provision to further align interests of leadership, associates, and shareholders.
Any shareholder who desires to contact the Chairman of the Board, the Lead Independent Director or the other members of the Board or who desires to make a recommendation of a director candidate for consideration by the Governance and Nominating Committee, may do so electronically by sending an email to the following address: directors@ffc-in.com.directors@ffc-in.com. Alternatively, a shareholder can contact the Chairman of the Board, Lead Independent Director, Chairman of the Governance and Nominating Committee or the other members of the Board by writing to: First Financial Corporation, One First Financial Plaza, P.O. Box 540, Terre Haute, Indiana 47808. Communications received electronically or in writing are distributed to the Chairman of the Board, Lead Independent Director, Chairman of the Governance and Nominating Committee or the other members of the Board as appropriate depending on the facts and circumstances outlined in the communication received. For example, if any complaints regarding accounting, internal accounting controls and auditing matters are received, then they will be forwarded by the Secretary to the Chairman of the Audit Committee for review.
For further information, including electronic versions of our Corporate Governance Guidelines, Code of Business Conduct and Ethics, Audit Committee Charter, Compensation and Employee Benefits Committee Charter and Governance and Nominating Committee Charter, please contact the Secretary of the Corporation, Rodger A. McHargue, First Financial Corporation, One First Financial Plaza, P.O. Box 540, Terre Haute, Indiana 47808, (812) 238-6000 or visit our website at
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In accordance with its written charter adopted by the Board, the Audit Committee of the Board assisted the Board in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing and financial reporting practices of the Corporation. During 2017,2022, the Audit Committee met four times and the Audit Committee chair, as representative of the Audit Committee, discussed the interim financial information contained in each quarterly earnings announcement with management and the independent public accounting firm prior to public release.
In discharging its oversight responsibility as to the audit process, the Audit Committee obtained from the independent public accounting firm a formal written statement describing all relationships between the independent public accounting firm and the Corporation that might bear on the independent public accounting firm’s independence consistent with applicable requirements of the Public Company Accounting Oversight Board (United States) regarding the independent public accounting firm’s communications with the Audit Committee concerning independence and has discussed with the independent public accounting firm any relationships that may impact the independent public accounting firm’s objectivity and independence and satisfied itself as to the independent public accounting firm’s independence. The Audit Committee also discussed with management, the internal auditors and the independent public accounting firm the quality and adequacy of the Corporation’s internal controls and the internal audit function’s organization, responsibilities, budget and staffing. The Audit Committee reviewed both with the independent and internal auditors their audit plans, audit scope and identification of audit risks.
The Audit Committee reviewed and discussed the audited financial statements of the Corporation as of and for the year ended December 31, 2017,2022, with management and the independent public accounting firm. Management represented to the Audit Committee that the Corporation’s financial statements as of and for the year ended December 31, 20172022, were prepared in accordance with accounting principles generally accepted in the United States. Management has the primary responsibility for the preparation of the Corporation’s internal controls and financial statements and the independent public accounting firm has the responsibility for performing an independent audit of our consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board.
Based on the above-mentioned review and discussions with management and the independent public accounting firm, the Audit Committee recommended to the Board that the Corporation’s audited financial statements be included in its 20172022 Annual Report on Form 10-K for filing with the SEC.
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Members of the Audit Committee | |
Thomas T. Dinkel, Chairman | |
W. Curtis Brighton Tina J. Maher Michael A. Carty Mark J. Blade |
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This Executive Compensation Discussion and Analysis (“CD&A”) describes our executive compensation program for our Named Executive Officers (“NEOs”) listed below. This CD&A also summarizes the Compensation and Employee Benefits Committee’s (“Compensation Committee” or “Committee”) process for making pay decisions, as well as its rationale for specific decisions related to the 20172022 performance year.