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
(Amendment No.)
Filed by the Registrantþx
Filed by a Party other than the Registranto¨
Check the appropriate box:
x | Preliminary Proxy Statement |
Confidential, for Use of the Commission Only (as permitted by Rule |
¨ | Definitive Proxy Statement |
¨ | Definitive Additional Materials |
¨ | Soliciting Material Pursuant to §240.14a-12 |
Home BancShares, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
x | No fee required. |
¨ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
(1) | Title of each class of securities to which the transaction applies: | ||
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(3) | Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | ||
(4) | Proposed maximum aggregate value of the transaction: | ||
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¨ | Fee paid previously with preliminary materials. |
¨ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
(1) | Amount Previously Paid: | ||
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(4) | Date Filed: | ||
719 Harkrider Street, Suite 100
Conway, Arkansas 72032
(501) 328-4770
Internet Site:www.homebancshares.com
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on April 20, 2010
The Annual Meeting of Shareholders of Home BancShares, Inc. (the “Company”) will be held on April 20, 2010,18, 2013, at 6:30 p.m. (CDT) at the Peabody Hotel,Centennial Valley Country Club Events Center, located at 3 Statehouse Plaza, Little Rock,1600 Centennial Club Drive, Conway, Arkansas, for the following purposes:
(1) | To elect | ||
(2) | To provide an advisory (non-binding) vote approving the Company’s compensation of its named executive officers. |
(3) | To approve an amendment to the Company’s Restated Articles of Incorporation, as amended, to increase the number of authorized shares of common stock from 50,000,000 to 100,000,000. |
(4) | To ratify the appointment of BKD, LLP as the Company’s independent registered public accounting firm for the next fiscal year. | |
(5) | To transact such other business as may properly come before the meeting or any adjournments thereof. |
Only shareholders of record on March 5, 2010,1, 2013, will be entitled to vote at the meeting or any adjournments thereof. A list of shareholders will be available for inspection at the office of the Company at 719 Harkrider Street, Suite 100, Conway, Arkansas, 72032, beginning two business days after the date of this notice and continuing through the meeting. The stock transfer books will not be closed.
The 20092012 Annual Report to Shareholders is included in this publication.
By Order of the Board of Directors |
C. RANDALL SIMS |
Chief Executive Officer |
Conway, Arkansas
March 12, 2010
YOUR VOTE IS IMPORTANT
PLEASE EXECUTE YOUR PROXY WITHOUT DELAY
Your vote is important. You can save the Company the expense of a second mailing by voting promptly. Shareholders of record can vote by telephone, on the Internet, by mail or by attending the Annual Meeting and voting by ballot as described below. (Please note: if you are a beneficial owner of shares held in the name of a bank, broker or other holder, please refer to your proxy card or the information forwarded by your bank, broker or other holder of record to see which options are available to you.)
The Internet and telephone voting procedures are designed to authenticate shareholders by use of a control number and to allow you to confirm that your instructions have been properly recordedrecorded.. If you vote by telephone or on the Internet, you do not need to return your proxy card.Telephone and Internet voting facilities for shareholders of record will be available 24 hours a day and will close at 1:00 a.m. Central time on April 20, 2010.18, 2013.
VOTE BY TELEPHONE
You can vote by calling the toll-free telephone number on your proxy card. Easy-to-follow voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded.
VOTE ON THE INTERNET
You also can choose to vote on the Internet. TheInternet by visiting the website for Internet voting iswww.envisionreports.com/HOMB.printed on your proxy card. Easy-to-follow prompts allow you to vote your shares and confirm that your instructions have been properly recorded. If you vote on the Internet, you can also request electronic delivery of future proxy materials.
VOTE BY MAIL
If you choose to vote by mail, simply mark your proxy, date and sign it, and return it to Computershare in the postage-paid envelope provided. If the envelope is missing, please mail your completed proxy card to Home BancShares, Inc., c/o Computershare, P. O. Box 43101, Providence, Rhode Island, 02940-5067.
VOTING AT THE ANNUAL MEETING
The method by which you vote will not limit your right to vote at the Annual Meeting if you decide to attend in person. If your shares are held in the name of a bank, broker or other holder of record, you must obtain a legal proxy, executed in your favor, from the holder of record to be able to vote at the Meeting.
All shares that have been properly voted and not revoked will be voted at the Annual Meeting. If you sign and return your proxy card but do not give voting instructions, the shares represented by that proxy will be voted as recommended by the Board of Directors.
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719 Harkrider Street, Suite 100
Conway, Arkansas 72032
(501) 328-4770
Internet Site:www.homebancshares.com
PROXY STATEMENT
This Proxy Statement and the accompanying proxy card are being mailed in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Home BancShares, Inc. (the “Company”) for use at the Annual Meeting of Shareholders. This Proxy Statement and the accompanying proxy card were first mailed to shareholders of the Company on or about March 12, 2010.
This introductory section is a summary of selected information from this Proxy Statement and may not contain all of the information that is important to you. To better understand the nominees being solicited for directors and the proposals that are submitted for a vote, you should carefully read this entire document and other documents to which we refer.
The proxies being solicited by this Proxy Statement are being solicited by the Company. The expense of soliciting proxies, including the cost of preparing, assembling and mailing the material submitted with this Proxy Statement, will be paid by the Company. The Company will also reimburse brokerage firms, banks, trustees, nominees and other persons for the expense of forwarding proxy material to beneficial owners of shares held by them of record. Solicitations of proxies may be made personally or by telephone, electronic communication or facsimile, by directors, officers and regular employees, who will not receive any additional compensation in respect of such solicitations.
Important Notice Regarding the Availability of Proxy Materials
for the Shareholder Meeting to be Held on April 20, 2010:
18, 2013:
The Notice and Proxy Statement and the Annual Report on Form 10-K
are available at www.edocumentview.com/homb.
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When and Where Is the Annual Meeting?
Date: | ||
Time: | 6:30 p.m., Central Daylight Time | |
Location: |
What Matters Will Be Voted Upon at the Annual Meeting?
At our Annual Meeting, shareholders will be asked to:
consider and vote on a proposal to elect the nominees listed in this proxy statement as directors for a term of one year;
consider and vote on a proposal to approve, on an advisory (non-binding) basis, the Company’s compensation of its named executive officers;
consider and vote on a proposal to approve an amendment to the Company’s Restated Articles of Incorporation, as amended, to increase the number of authorized shares of common stock from 50,000,000 to 100,000,000;
consider and vote on a proposal to ratify the appointment of BKD, LLP as the Company’s independent registered public accounting firm for the next fiscal year; and
transact such other business as may properly come before the meeting or any adjournments thereof.
Who Is Entitled to Vote?
Only shareholders of record at the close of business on the record date, March 5, 2010,1, 2013, are entitled to receive the Notice of Annual Meeting and to vote the shares of common stock that they held on that date at the Meeting or at any postponement or adjournment of the Meeting. Each outstanding share entitles its holder to cast one vote on each matter to be voted on.
Who Can Attend the Meeting?
All shareholders as of the record date, or their duly appointed proxies, may attend the Meeting, and each may be accompanied by one guest. Seating is limited and will be on a first-come, first-served basis. Registration will begin at 5:30 p.m., and seating will be available at approximately 6:00 p.m.
No cameras, electronic devices, large bags, briefcases or packages
will be permitted at the Meeting.
Please note that if you hold your shares in “street name” (that is, through a broker or other nominee), you will need to bring a copy of a brokerage statement reflecting your stock ownership as of the record date and check in at the registration desk at the Meeting.
What Constitutes a Quorum?
The presence at the Meeting, in person or by proxy, of the holders of a majority of the shares of common stock outstanding on the record date will constitute a quorum, permitting the Company to conduct its business. As of the record date, 25,713,567 shares of common stock of the Company were outstanding. Proxies received, but marked as abstentions and broker non-votes, will be included in the calculation of the number of shares considered to be present at the Meeting.
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Can a Shareholder Nominate a Director?
The Nominating and Corporate Governance Committee (“Nominating Committee”) of the Board of Directors will consider a candidate properly and timely recommended for directorship by a shareholder or group of shareholders of the Company. The recommendation must be submitted by one or more shareholders that have beneficially owned, individually or as a group, 2% or more of the outstanding common stock for at least one year as of the date the recommendation is submitted. Shareholder recommendations must be submitted to the Secretary of the Company in writing via certified U.S. mail not less than 120 days prior to the first anniversary of the date of the Proxy Statement relating to the Company’s previous Annual Meeting. Shareholder recommendations for the Annual Meeting of Shareholders in 20112014 must be received by the Company by November 12, 2010., 2013. Recommendations must be addressed as follows:
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Attn: Corporate Secretary
P.O. Box 966
Conway, Arkansas 72033
DIRECTOR CANDIDATE RECOMMENDATION
Generally, candidates for a director position should possess:
relevant business and financial expertise and experience, including an understanding of fundamental financial statements;
the highest character and integrity and a reputation for working constructively with others;
sufficient time to devote to meetings and consultation on Board matters; and
freedom from conflicts of interest that would interfere with their performance as a director.
The full text of our “Policy Regarding Director Recommendations by Stockholders” and “Nominating and Corporate Governance Committee Directorship Guidelines and Selection Policy” are published on our website atwww.homebancshares.comand can be found under the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
How Can I Communicate Directly with the Board?
Shareholder communications to the Board of Directors, any committee of the Board of Directors, or any individual director must be sent in writing via certified U.S. mail to the Corporate Secretary at the following address:
Home BancShares, Inc.
Attn: Corporate Secretary
P.O. Box 966
Conway, Arkansas 72033
Our “Stockholder Communications Policy” is published on the Company’s website atwww.homebancshares.comand can be found under the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
How Do I Vote?
The enclosed proxy card indicates the number of shares you own. There are four ways to vote:
By Internet at the website shown on your proxy card; we encourage you to vote this way.
By toll-free telephone at the number shown on your proxy card.
By completing and mailing your proxy card.
By written ballot at the Meeting.
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If you vote by Internet or telephone, your vote must be received by 1:00 a.m. Central time on April 20, 2010.18, 2013. Your shares will be voted as you indicate.If you do not indicate your voting preferences, Randy E. Mayor and Brian S. Davis will vote your sharesFORall of the director nominees,FOR Proposal 2,FORProposal 3 andFORProposals 2 and 3.Proposal 4.
If You Vote by Telephone or on the Internet, You DoNOT Need to Return Your Proxy Card.
If you complete and properly sign the accompanying proxy card and return it to the Company, or tender your vote via telephone or the Internet, it will be voted as you direct. If you attend the Meeting, you may deliver your completed proxy card in person. A proxy duly executed and returned by a shareholder, and not revoked prior to or at the Meeting, will be voted in accordance with the shareholder’s instructions on such proxy.
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If My Shares Are Held By a Broker or Nominee, Do I Need to Instruct the Broker or Nominee How to Vote My Shares?
Yes. If you hold shares in “street name” through a broker or other nominee, your broker or nominee may not be permitted to exercise voting discretion with respect to some of the matters to be acted upon. Under current stock exchange rules, brokers who do not have instructions from their customers may not use their discretion in voting their customers’ shares on certain specific matters which are not considered to be “routine” matters, including the election of directors, executive compensation and other significant matters. The proposals in this Proxy Statement to elect directors and to approve on an advisory basis the Company’s executive compensation are not considered to be routine matters.Thus, if you do not give your broker or nominee specific instructions with respect to each of these matters, your shares may not be voted on those matters and will not be counted in determining the number of shares necessary for approval. Shares represented by such “broker non-votes” will, however, be counted in determining whether there is a quorum.
The approval of an amendment to the Company’s Restated Articles of Incorporation, as amended, to increase the number of authorized shares of common stock and the ratification of BKD, LLP as the Company’s independent registered public accounting firm are considered routine matters, and therefore, if you do not give your broker or nominee specific instructions with respect to these proposals, your broker or nominee will have the discretionary authority to vote your shares on these proposals.
What Are the Board’s Recommendations?
Unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote in accordance with the recommendations of the Board of Directors. The Board’s recommendation is set forth together with each proposal in this Proxy Statement. In summary, the Board recommends a vote:
• | Forthe election of the nominated slate of directors (see pages | ||
• | For the approval, on an advisory (non-binding) basis, of the Company’s compensation of its named executive officers (see page 38). |
• | For the approval of the amendment to the Company’s Restated Articles of Incorporation, as amended, to increase the number of authorized shares of common stock from 50,000,000 to 100,000,000 (see pages 39-40). |
• | Forthe ratification of the appointment of BKD, LLP as the Company’s independent registered public accounting firm (see pages | ||
What Other Business May Be Brought Before the Meeting?
As of the date of this Proxy Statement, the Board knows of no other business that may properly be, or is likely to be, brought before the Annual Meeting. With respect to any other matter that properly comes before the Meeting, the proxy holders will vote as recommended by the Board of Directors or, if no recommendation is given, at their own discretion.
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What Vote Is Required to Approve Each Proposal?
• | Election of Directors. The affirmative vote of a plurality of the votes cast in person or by proxy at the Annual Meeting is required for the election of directors. A properly executed proxy marked “WITHHOLD AUTHORITY” with respect to the election of one or more of the directors will not be voted with respect to the director or directors indicated, although it will be counted for purposes of determining whether there is a quorum. | ||
• | Other Proposals. For each other proposal, the affirmative vote of a majority of the votes cast in person or by proxy at the Annual Meeting, assuming a quorum is present, will be required for approval. A properly executed proxy marked “ABSTAIN” with respect to any such matter will not be voted, although it will be counted for purposes of determining whether there is a quorum. Accordingly, an abstention will have no effect on the outcome of the vote. |
The authorized common stock of the Company consists of 50,000,000 shares at $0.01 par value. As of the close of business on March 5, 2010,1, 2013, there were 25,713,567 shares eligible to vote.
Can I Change My Vote After I Return the Proxy Card?
Yes. Even after you have submitted your proxy, you may change your vote at any time before the proxy is exercised by filing with the Secretary of the Company either a notice of revocation or a duly executed proxy bearing a later date. The powers of the proxy holders will be suspended if you attend the Meeting in person and so request, although attendance at the Meeting will not by itself revoke a previously granted proxy.
6What Should I Do If I Receive More Than One Set Of Voting Materials?
You may receive more than one set of voting materials, including multiple copies of this Proxy Statement and multiple proxies or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you may receive a separate voting instruction card for each brokerage account. If you are a registered owner and your shares are registered in more than one name, you will receive more than one proxy card. Please vote each proxy and instruction card that you receive.
Where Can I Find The Voting Results Of The Annual Meeting?
The Company will publish final voting results of the Annual Meeting in a Current Report on Form 8-K filed with the Securities and Exchange Commission within four business days after the Annual Meeting on April 18, 2013.
What Do I Need To Do Now?
First, read this Proxy Statement carefully. Then, if you are a registered owner of shares of our common stock as of March 1, 2013, you should, as soon as possible, submit your proxy by executing and returning the proxy card or by voting by telephone or on the Internet. If you are the beneficial owner of shares held in “street name,” then you should follow the voting instructions of your broker or other nominee. Your shares will be voted in accordance with the directions you specify. If you submit an executed proxy card to the Company but fail to specify voting directions, your shares will be voted in accordance with the recommendations of the Board of Directors.
You Should Carefully Read this Proxy Statement in its Entirety.
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PROPOSAL ONE – ELECTION OF DIRECTORS
Our Restated Articles of Incorporation provide that the number of directors shall not be less than two nor more than fifteen, with the exact number to be fixed by the shareholders or the Board. Currently, we have eleven directors.
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Each of the nominees has consented to serve the term for which he is nominated. If any nominee becomes unavailable for election, which is not anticipated, the directors’ proxies will vote for the election of such other person as the Board may nominate, unless the Board resolves to reduce the number of directors to serve on the Board and thereby reduce the number of directors to be elected at the meeting.
The Board of Directors Recommends that Shareholders Vote
FORFOR
Each of the Nominees Listed Herein
DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
The names of the Company’s directors and executive officers as of March 5, 2010,1, 2013, and their respective ages and positions are listed in the table below.
Name | Age | Positions Held with Home BancShares, Inc. | Positions Held with Centennial Bank | |||||
John W. Allison | 66 | Chairman of the Board | Chairman of the Board | |||||
C. Randall Sims | 58 | Chief Executive Officer and Director | Chief Executive Officer, President, and Director | |||||
Randy E. Mayor | 48 | Chief Financial Officer, Treasurer, and Director | Chief Financial Officer and Director | |||||
Brian S. Davis | 47 | Chief Accounting Officer and Investor Relations Officer | — | |||||
Kevin D. Hester | 49 | Chief Lending Officer | Chief Lending Officer and Director | |||||
Milburn Adams | 70 | Director | Director | |||||
Robert H. Adcock, Jr. | 64 | Vice Chairman of the Board | Vice Chairman of the Board | |||||
Richard H. Ashley | 57 | Director | Director | |||||
Dale A. Bruns | 70 | Director | Director | |||||
Richard A. Buckheim | 69 | Director | — | |||||
Jack E. Engelkes | 63 | Director | Director | |||||
James G. Hinkle | 64 | Director | — | |||||
Alex R. Lieblong | 62 | Director | Advisory Director | |||||
William G. Thompson | 65 | Director | — | |||||
Robert F. Birch, Jr. | 63 | — | Regional President | |||||
Tracy M. French | 51 | — | Regional President |
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NOMINEES FOR DIRECTOR
The director nominees consist of eleven of the twelve current members of the Board. No successor was nominated to be voted on at the Annual Meeting for one of our current directors whose term on the Board will expire at the Annual Meeting. The biography of each of the nominees below contains information regarding the person’s service as a director, business experience, director positions held currently or at any time during the last five years, and the experiences, qualifications, attributes or skills that caused the Nominating Committee and the Board to determine that the person should serve as a director.
During 2008 and 2009, the Company announced plans to combinecombined the charters of the Company’s former bank subsidiaries into a single charter and adopt Centennial Bank as the common name. In December 2008, we began this combination process by changing the name of– First State Bank, to Centennial Bank and combining the charter of Marine Bank into this renamed First State Bank (now Centennial Bank). During 2009, we completed the combination of the charters of our remaining bank subsidiaries, Community Bank, Twin City Bank, Marine Bank, Bank of Mountain View and Centennial Bank (of Little Rock), – into a single charter and adopted Centennial Bank as the new Centennial Bank.common name. As used hereinafterin the following biographies and elsewhere in this Proxy Statement, any reference to our “former bank subsidiaries” or to any of the six banks named in this paragraph refers to the Company’s separately chartered bank subsidiary or subsidiaries as they existed prior to the merger of the banks into a single charter.
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John W. Allison | ||
Director Since 1998 |
John W. Allison is the founder and has been Chairman of the Board of Home BancShares since 1998. He also serves on the Asset Quality Committee and Asset/Liability Committee of Home BancShares. From 1998 to July 2009, he served as Chief Executive Officer of Home BancShares. Mr. Allison has more than 2629 years of banking experience, including service as Chairman of First National Bank of Conway from 1983 until 1998, and as a director of First Commercial Corporation from 1985 (when First Commercial acquired First National Bank of Conway) until 1998. At various times during his tenure on First Commercial’s board, Mr. Allison served as the Chairman of that company’s Executive Committee and as Chairman of its Asset Quality Committee. Prior to its sale to Regions Financial Corporation in 1998, First Commercial was a publicly traded company and the largest bank holding company headquartered in Arkansas, with approximately $7.3 billion in assets. In 2008, Mr. Allison became a director of Lodgian, Inc., a publicly traded owner and operator of hotels. Mr. Allison is a successful business owner with extensive experience in the management of banks and bank holding companies. As the founder and former Chief Executive Officer of Home BancShares, he has intimate knowledge of the issues facing our management, and he has been a guiding figure in the development of Home BancShares and its growth strategy. He is also the largest individual shareholder of Home BancShares, which the Board of Directors believes aligns his interests with those of our shareholders.
C. Randall Sims | ||
Director Since 1998 |
C. Randall Sims was named Chief Executive Officer of Home BancShares in 2009. Since 1998, Mr. Sims has been and continues to be Chief Executive Officer and President of Centennial Bank (formerly First State Bank) and a director of Home BancShares. He also serves as Chairman of the Asset Quality Committee and as a member of Asset/Liability Committee of Home BancShares. From 1998 to 2009, he served as Secretary of Home BancShares. Prior to joining First State Bank, Mr. Sims was an executive vice president with First National Bank of Conway. He holds a Juris Doctor degree from the University of Arkansas at Little Rock School of Law and a Bachelor of Arts degree in accounting and business administration from Ouachita Baptist University in Arkadelphia, Arkansas. He attended the Graduate School of Banking at the University of Wisconsin and is an honor graduate of the American Bankers Association National Commercial Lending School held at the University of Oklahoma. Mr. Sims currently servesformerly served as a Trustee at the University of Central Arkansas and aswas Chairman of the Conway Christian School Board.Board for 17 years. He is currently serving on the Board of Trustees at Ouachita Baptist University. Mr. Sims’ educational background in accounting, business, law and banking provides him a wide-ranging set of skills for the management of a public company such as Home BancShares. He has served as Chief Executive Officer for our bank subsidiary for over 1114 years and has extensive banking and executive experience. As Chief Executive Officer of the holding company and the bank and as a long-time director of both entities and other organizations, he brings knowledge of the day-to-day management of the Company as well as expertise in many areas, including financial, corporate governance, risk assessment, and operational matters.
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Randy E. Mayor | ||
Director Since 2009 |
Randy E. Mayor joined Home BancShares in 1998 as Executive Vice President and Finance Officer and became our first Chief Financial Officer in 2004. Mr. Mayor has been Chief Financial Officer and Treasurer of Home BancShares since 2004 and a director of Home BancShares since 2009. He currently serves as Chairman of the Asset/Liability Committee and as a member of the Asset Quality Committee. Since 1998, he has also served as Chief Financial Officer and as a director of Centennial Bank (formerly First State Bank). Mr. Mayor is a certified public accountant and has more than 2226 years of banking experience. From 1988 to 1998, he held various positions at First National Bank of Conway, a subsidiary of First Commercial, including Senior Vice President and Finance Officer from 1992 to 1998. He holds a bachelor of business administration degree from the University of Central Arkansas and is a graduate of the American Bankers Association National Commercial Lending School held at the University of Oklahoma. Mr. Mayor has extensive experience in financial and accounting matters relating to banks and bank holding companies. As our first and only Chief Financial Officer, he provides an in-depth understanding of the Company’s financial condition on a current and historical basis, as well as experience with internal controls, risk assessment, and management of the financial affairs of a public company.
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Milburn Adams | Director Since 2011 |
Milburn Adams has been a director of Home BancShares since October 2011 and a director of Centennial Bank (formerly First State Bank) since 2004. He was appointed to the Audit Committee and the Compensation Committee of Home BancShares in January 2012. Prior to Mr. Adams’ service with First State Bank, he spent 13 years with the Arkansas Department of Education, serving as an Area Supervisor of Special Education and Director of Evaluation and Admissions at the Arkansas School for the Deaf. This experience was followed by 19 years of service in the manufactured home business. From 1982 to 1986, he was responsible for the administration, sales, manufacturing, and distribution of manufactured homes throughout an eight state area as General Manager of Squire Homes. Mr. Adams was the President of Spirit Homes, Inc. of Conway, Arkansas, from 1986 to 1997. He served as a Division President of Cavalier Homes, Inc. from 1997 to 2000, when Spirit Homes was acquired by Cavalier Homes, Inc. of Alabama. Mr. Adams is an experienced business person, managing and operating several businesses in the central Arkansas area and has substantial knowledge of the banking business through his over eight years of service on the board of our bank subsidiary.
Robert H. Adcock, Jr. | Director From 1998 to 2003 and Since 2007 |
Robert H. Adcock, Jr. has been a director and Vice Chairman of Home BancShares since July 2007. He also serves on the Asset Quality Committee, Audit Committee, Asset/Liability Committee and Nominating and Corporate Governance Committee of Home BancShares. Mr. Adcock is a co-founder of Home BancShares with Mr. Allison. He previously served as a director and Vice Chairman of Home BancShares from 1998 to 2003. In June 2003, Mr. Adcock stepped down from the Board of Directors of Home BancShares to become the Arkansas State Bank Commissioner. He was reappointed as Vice Chairman of Home BancShares in July 2007 upon completion of his four-year term as Arkansas State Bank Commissioner. Mr. Adcock retired from the First National Bank of Conway, Arkansas, (now Regions Bank), in 1996 after more than 20 years of service. He presently operates a farming operation in Gould (Lincoln County), Arkansas, and has many real estate holdings in the Conway, Arkansas, area. Mr. Adcock has an extensive background in banking, and as a co-founder of Home BancShares, he has a vast knowledge of the Company and our markets. His experience as Arkansas State Bank Commissioner gives him particular insight into regulatory matters affecting the Company and the bank, as well as contacts in the banking industry throughout Arkansas.
Richard H. Ashley | ||
Director Since 2004 |
Richard H. Ashley has been a director of Home BancShares since 2004 and served as Vice Chairman from 2006 to July 2007. He also serves on the Asset Quality Committee, Asset/Liability Committee and the Compensation Committee of Home BancShares. He has served as a director of Centennial Bank (formerly First State Bank) since February 2009. He served as a director of the former Twin City Bank from 2000 until its charter was merged into Centennial Bank in 2009, and as Chairman of Twin City Bank from 2002 to 2009. Since March 2007, he has been a director of Entergy Arkansas, Inc., an electric public utility company. Mr. Ashley is President and owner of the Ashley Company, a privately held company involved in land development and investment in seven states throughout the United States since 1978. Mr. Ashley has extensive experience and knowledge with respect to real estate and real estate financing, which is a significant part of our lending. He has substantial banking experience through his nearly 10over 12 years of service on the boardboards of Centennial Bank and our former subsidiary bank, Twin City Bank. In addition, his service on the Compensation Committee of Home BancShares has enhanced his knowledge of public company executive compensation matters.
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Dale A. Bruns | ||
Director Since 2004 |
Dale A. Bruns has been a director of Home BancShares since 2004 and a director of Centennial Bank (formerly First State Bank) since 1998. Mr. Bruns also served as a director of the former Twin City Bank from 2000 to 2009. Mr. Bruns is the chairman of the compensation committeesCompensation Committees for Home BancShares and Centennial Bank, (formerly First State Bank), and is a member of the Nominating and Corporate Governance Committee and the Asset/Liability Committee of Home BancShares. Prior to his service with First State Bank, he served as a director of the First National Bank of Conway from 1985 to 1998. Mr. Bruns has owned and operated several McDonald’s restaurants located in central Arkansas. He is also the owner of Central Arkansas Sign Company, Inc. He currently serves on the board of the Arkansas McDonald’s Self Insurance Trust and on the impact committee for the McDonald’s Great Southern Region.Trust. He is a past member of the McDonald’s National Operator advisory board of directors. Mr. Bruns is an experienced business person, owning and operating multiple businesses. He has significant experience in the banking industry and knowledge of our local markets, having served as a bank director in central Arkansas for 25over 26 years. As Chairman of our Compensation Committee duringfor the past fourseven years, he has gained substantial knowledge of issues relating to public company oversight of executive compensation matters.
Richard A. Buckheim | ||
Director Since 2005 |
Richard A. Buckheim has been a director of Home BancShares since 2005. He also serves on the Compensation Committee of Home BancShares. From 2000 until December 2008 when the Marine Bank charter was merged into Centennial Bank (formerly First State Bank), he served as Chairman of the Board of Marine Bank and served on the bank’s compensation committee. He currently serves as Regional Chairman of Centennial Bank (formerly First State Bank) for the bank’s Florida region. Mr. Buckheim formerly owned two restaurants in Key West, Florida. Prior to moving to Key West, he founded and served as President of Buckheim and Rowland, Inc., a Michigan-based advertising and marketing company with offices in Ann Arbor and Detroit, Michigan, New York, New York, and Melbourne, Florida. Mr. Buckheim has extensive experience in banking and a particular knowledge of our south Florida market area through his service as Chairman of our former bank subsidiary, Marine Bank. He also provides a valuable background in advertising and marketing, as well as executive experience, as former president of the multistate advertising and marketing company that he founded and as a former business owner.
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Jack E. Engelkes | ||
Director Since 2004 |
Jack E. Engelkes has been a director of Home BancShares since 2004 and a director of Centennial Bank (formerly First State Bank) since 1998. He also serves as Chairman of the Audit Committee and a member of the Compensation Committee of Home BancShares. From 1995 to 1998, he served as a director of First National Bank of Conway. Since 1990, Mr. Engelkes has served as managing partner in the accounting firm of Engelkes and Felts, Ltd. He became Presidentserved as Chairman of the Board of Conway Regional Health Foundation in 2006. He has also been a director of the Conway Regional Medical Center since 2005 and was elected Chairman of the Conway Regional Medical Center Board for 2011 and 2012. In addition, Mr. Engelkes has been a director of the Conway Development Corporation since 2000. Mr. Engelkes holds a bachelor’s degree in Business and Economics from Hendrix College in Conway. Mr. Engelkes is a certified public accountant and has extensive knowledge and experience in accounting, auditing and financial reporting. He has a strong understanding of the banking business, and particularly the Company, through his combined service over the past 1517 years as a director of Home BancShares, our subsidiary bank and First National Bank of Conway. Based on that service and his other directorships, he offers valuable experience with respect to corporate governance and compensation matters.
James G. Hinkle | ||
Director Since 2005 |
James G. Hinkle has been a director of Home BancShares since 2005. Mr. Hinkle currently serves as a member of the Asset/LiabilityAudit Committee of Home BancShares.BancShares and has previously served on our Asset/Liability Committee. He has over 2831 years of banking experience. He served as Chairman of the former Bank of Mountain View from 2005 until its charter was merged into Centennial Bank in 2009. From 1995 to 2005, he served as President of Mountain View BancShares, Inc., until the company’s merger into Home BancShares. He served as President of the Bank of Mountain View from 1981 to 2005. In 2003, Mr. Hinkle became a director of the National Wild Turkey Federation, a national nonprofit conservation and hunting organization. Mr. Hinkle has a lengthy background in banking and executive management through his long-time service as an officer and director of the former Bank of Mountain View and Mountain View Bancshares. In addition, he has particular knowledge of the Company’s customer base in our north central Arkansas market.
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Alex R. Lieblong | ||
Director Since 2003 |
Alex R. Lieblong has been a director of Home BancShares since 2003. He has served as an advisory director of Centennial Bank (formerly First State Bank) since 2002, and he served as a director of First State Bank from 1998 to 2002. He also serves as Chairman of the Nominating and Corporate Governance Committee and a member of the Audit Committee of Home BancShares. Mr. Lieblong became a director of Lodgian, Inc., a publicly traded owner and operator of hotels, in 2006. He also currently serves on the board of directors of Ballard Petroleum, a privately held energy company. Since 1997, Mr. Lieblong has been an owner and general principal in the brokerage firm of Lieblong & Associates, Inc. Prior to Lieblong & Associates, Inc., he held management positions with Paine Webber, Merrill Lynch, and E.F. Hutton. Mr. Lieblong was a founder and has been managing partner of Key Colony Fund, L.P., a hedge fund, since 1998. He served as a director of Deltic Timber from 1997 to February 2007. He also served as a director of Lodgian, Inc., a publicly traded owner and operator of hotels, from 2006 to 2010. Mr. Lieblong has extensive experience in the financial services industry and over a decade of experience as a director of other publicly traded and privately held companies. He has substantial knowledge of financial, regulatory, corporate governance and other matters affecting public companies which the Board of Directors believes is valuable to the Company.
EXECUTIVE OFFICERS
The biography below of each of our executive officers who is not a member of our Board of Directors contains information regarding the person’s business experience, including positions held currently or at any time during the last five years.
Robert F. Birch, Jr.
Robert F. Birch, Jr. currently serves as a regional president for Centennial Bank. He served as the President and Chief Executive Officer and a director of Home BancShares since 2004.our former bank subsidiary, Twin City Bank, from 2000 when he helped found the bank until June 2009 when the charter was merged into Centennial Bank (formerly First State Bank). Mr. Birch has over 42 years of banking experience. He alsobegan his banking career in 1970 with the original Twin City Bank, which was eventually sold to an out-of-state institution. He is a graduate of the University of Arkansas at Little Rock and the University of Colorado School of Bank Marketing in Boulder. Mr. Birch serves on the Audit Committeeboards of Philander Smith College as Chairman, the Arkansas Art Center and Baptist Health Foundation. He serves as the Nominatingimmediate Past President of the Little Rock, Arkansas “Club 99” Downtown Rotary Club.
Brian S. Davis
Brian S. Davis joined Home BancShares in 2004 as Director of Financial Reporting and Corporate Governance Committeeadded Investor Relations Officer to his responsibilities in 2006. In 2010, he was promoted to Chief Accounting Officer while continuing to serve as Investor Relations Officer. He is a certified public accountant and has 21 years of Home BancShares.banking experience, which includes serving as Vice President of Finance for Simmons First National Corporation, Controller of Simmons First Mortgage Company, and Assistant Vice President of Finance for Worthen Banking Corporation. He spent the first four years of his career with the accounting firm of BKD, LLP. Mr. ThompsonDavis is a graduate of the University of Arkansas at Fayetteville.
Tracy M. French
Tracy M. French currently serves as a regional president for Centennial Bank. He was the President and Chief Executive Officer and a director of our former bank subsidiary, Community Bank, from 2002 to 2009. Mr. French has over 28 years of banking experience. He served asis a directorgraduate of the formerUniversity of Arkansas at Fayetteville and the Southwestern Graduate School of Banking at Southern Methodist University. Mr. French currently serves on the board of the Cabot Panther Education Foundation. He is also currently President of Arkansas State University at Beebe Community Bank from 1988 until its charter was merged intoCouncil and serves on the board of the Arkansas Student Loan Authority.
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Kevin D. Hester
Kevin D. Hester joined Centennial Bank (formerly First State Bank) in 2009.1998 as Executive Vice President of Lending, and became Chief Lending Officer of Home BancShares in 2010. He has more than 27 years of banking experience. From 20021985 to 2004, he served as Chairman1998, Mr. Hester held various positions at First Commercial Corporation, including Executive Vice President of Lending at First Commercial’s Kilgore, Texas, affiliate. Mr. Hester is a graduate of the BoardUniversity of Community Bank. Mr. Thompson owns several privately held businesses locatedCentral Arkansas with a bachelor’s degree in Cabot, Arkansas, including Transloading Service Inc., Thompson Service Inc.,accounting and Thompson Sales Inc. Mr. Thompsonis an honor graduate of the National Commercial Lending School in Norman, Oklahoma. He is a business owner with many years of involvement in the banking industry. He has particular knowledgeformer board member of the Company’s customer base in our east central Arkansas marketNational Association of Government Guaranteed Lenders (NAGGL) and has extensive experience in dealing with financial, operational and governance matters of a community banking corporation.
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Duties of the Board
The Board of Directors has the responsibility to serve as the trustee for the shareholders. It also has the responsibility for establishing broad corporate policies and for the overall performance of the Company. The Board, however, is not involved in day-to-day operating details. Members of the Board are kept informed of the Company’s business through discussion with the Chief Executive Officer and other officers, by reviewing analyses and reports sent to them quarterly, and by participating in Board and Committee meetings.
Corporate Governance Guidelines and Policies
We believe that good corporate governance helps ensure that the Company is managed for the long-term benefit of its shareholders. We continue to review our corporate governance policies and practices, corporate governance rules and regulations of the Securities and Exchange Commission (the “SEC”), and the listing standards of the NASDAQ Global Select Market on which our common stock is traded. The Board has adopted various corporate governance guidelines and policies to assist the Board in the exercise of its responsibilities to the Company and its shareholders. The guidelines and policies address, among other items, director independence and director qualifications. You can access and print our corporate governance guidelines and policies, including the charters of our Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, our Corporate Code of Ethics for Directors, Executive Officers and Employees and other Company policies and procedures required by applicable law or regulation, on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
Director Independence
NASDAQ rules require that a majority of the directors of NASDAQ-listed companies be “independent.” An “independent director” generally means a person other than an officer or employee of the listed company or its subsidiaries, or any other individual having a relationship, which, in the opinion of the listed company’s board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Certain categories of persons are deemed not to be independent under the NASDAQ rules, such as persons employed by the listed company within the last three years, and persons who have received (or whose immediate family members have received) payments exceeding a specified amount from the listed company within the last three years, excluding payments that are not of a disqualifying nature (such as compensation for board service, payments arising solely from investments in the listed company’s securities, and benefits under a tax-qualified retirement plan). NASDAQ rules impose somewhat more stringent independence requirements on persons who serve as members of the audit committee or, beginning in 2014, the compensation committee of a listed company.
Of the eleventwelve persons who currently serve on our Board of Directors, we believe that eightMessrs. Adams, Adcock, Ashley, Bruns, Buckheim, Engelkes, Hinkle, Lieblong and Thompson are “independent” for purposes of NASDAQ rules. Messrs. Allison, Mayor and Sims are not considered independent because they are officers of Home BancShares. Mr. Allison cannot be considered independent because he has been an officer within the last three years. The Board has also determined that no member of the Audit Committee, Compensation Committee or Nominating and Corporate Governance Committee has any material relationship with the Company (either directly or indirectly as a partner, shareholder or officer of an organization that has a relationship with the Company) and that all members of these committees meet the criteria for independence under the NASDAQ listing standards.
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Board Structure and Role in Risk Oversight
In 2009, the Board of Directors separated the positions of Chairman and Chief Executive Officer (“CEO”) when the Board promoted Mr. Sims to CEO. Mr. Allison, formerly the Chairman and CEO of the Company, now serves as Chairman of the Board. Prior to that time, Mr. Allison had been the only CEO for the Company since its founding. The primary purpose of installing a separate CEO with Mr. Allison continuing to serve as Chairman was to facilitate and strengthen the succession of management of the Company. This separation of Chairman and CEO also allows for greater oversight of the Company by the Board. The Board is actively involved in oversight of risks that could affect the Company. This oversight is conducted primarily through committees of the Board, as disclosed in the description of each of the committees below and in the charters of each of the committees, but the full Board has retained responsibility for general oversight of risks. The Board satisfies this responsibility through full reports by each committee chair regarding the committee’s considerations and actions, as well as through regular reports directly from officers responsible for oversight of particular risks within the Company.
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We have adopted a Code of Ethics that applies to all of our directors, officers, and employees. We believe our Code of Ethics is reasonably designed to deter wrongdoing and to promote honest and ethical conduct, including the ethical handling of conflicts of interest, full, fair and accurate disclosure in filings and other public communications made by us, compliance with applicable laws, prompt internal reporting of ethics violations, and accountability for adherence to the Code of Ethics. This Code of Ethics is published in its entirety on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.” We will post on our website any amendment to this code and any waivers of any provision of this code made for the benefit of any of our senior executive officers or directors.
BOARD MEETINGS AND COMMITTEES OF THE BOARD
The business of the Company is managed under the direction of the Board of Directors, who meet on a regularly scheduled basis during the calendar year to review significant developments affecting the Company and to act on matters that require Board approval. Special meetings are also held when Board action is required on matters arising between regularly scheduled meetings. Written consents to action without a meeting may be obtained if the Company deems it more appropriate.
All members of the Board are strongly encouraged to attend each meeting of the Board and meetings of the Board Committees on which they serve, as well as the Annual Meeting. The Board of Directors held four regularly scheduled meetings and five special meetings during calendar year 2009.2012. During this period all current memberseach member of the Board participated in at least 91%75% of the meetings of the Board, and committeeeach member of the Board except Mr. Bruns participated in at least 75% of the meetings andof the committees on which the director served during the period that he served. Mr. Bruns attended all meetings of the independent Board committees on which he served during 2012. In addition, all of the current Board members except one attended the Company’s Annual Meeting in 2009.2012. Our “Director Attendance Policy” is published on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
Our Board of Directors has fivefour standing committees: the Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee and the Asset/Liability Committee and the Asset Quality Committee. Committee members are elected annually by the Board and serve until their successors are elected and qualified or until their earlier resignation or removal.
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The following table discloses the Board members who serve on each of the Board’s committees and the number of meetings held by each committee during calendar year 2009.
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Nominating | ||||||||||
and Corporate | Asset | |||||||||
Audit | Compensation | Governance | Asset/Liability | Quality | ||||||
Robert H. Adcock, Jr. | X | X | X | X | ||||||
John W. Allison | X | X | ||||||||
Richard H. Ashley | X | X | X | |||||||
Dale A. Bruns | Chair | X | ||||||||
Richard A. Buckheim | X | |||||||||
Jack E. Engelkes | Chair | X | ||||||||
James G. Hinkle | X | |||||||||
Alex R. Lieblong | X | Chair | ||||||||
Randy E. Mayor | Chair | X | ||||||||
C. Randall Sims | X | Chair | ||||||||
William G. Thompson | X | X | ||||||||
Number of Meetings | 5 | 4 | 1 | 4 | 4 |
Audit | Compensation | Nominating and Corporate Governance | Asset/Liability | |||||
Milburn Adams | X | X | ||||||
Robert H. Adcock, Jr. | X | X | X | |||||
John W. Allison | X | |||||||
Richard H. Ashley | X | X | ||||||
Dale A. Bruns | Chair | X | X | |||||
Richard A. Buckheim | X | |||||||
Jack E. Engelkes | Chair | X | ||||||
James G. Hinkle | X | |||||||
Alex R. Lieblong | X | Chair | ||||||
Randy E. Mayor | Chair | |||||||
C. Randall Sims | X | |||||||
William G. Thompson | X | X | ||||||
Number of Meetings | 5 | 3 | 2 | 4 |
Audit Committee
The Audit Committee assists the Board in fulfilling its oversight responsibility relating to the integrity of our accounting and financial reporting processes and our financial statements, our compliance with legal and regulatory requirements, the independent auditor’s qualifications and independence, and the performance of our internal audit function and our independent auditors. In fulfilling its duties, the Audit Committee, among other things:
prepares the Audit Committee report for inclusion in the annual proxy statement;
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appoints, compensates, retains and oversees the independent auditors;
discusses with the internal and independent auditors the scope and plans for their respective audits;
reviews the results of each quarterly review and annual audit by the independent auditors;
reviews the Company’s financial statements and related disclosures in the Company’s quarterly and annual reports prior to filing with the SEC;
reviews the Company’s policies with respect to risk assessment and risk management;
reviews the Company’s internal controls, the results of the internal audit program, and the Company’s disclosure controls and procedures and quarterly assessment of such controls and procedures;
establishes procedures for handling complaints regarding accounting, internal accounting controls, and auditing matters, including procedures for confidential, anonymous submission of concerns by employees regarding such matters; and
reviews the Company’s legal and regulatory compliance programs.
The Board of Directors has adopted a written charter for the Audit Committee that meets the applicable standards of the SEC and NASDAQ. A copy of the Audit Committee Charter is published on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
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The Audit Committee is comprised of Jack E. Engelkes, Chairman, Milburn Adams, Robert H. Adcock, Jr., James G. Hinkle, Alex R. Lieblong and William G. Thompson. The Board has determined that each member of the Committee satisfies the independence requirements of the NASDAQ listing standards, that each member of the Committee is financially literate, knowledgeable and qualified to review financial statements, and that Mr. Engelkes has the attributes of an “audit committee financial expert” as defined by the regulations of the SEC.
Compensation Committee
The Compensation Committee aids the Board in discharging its responsibility with respect to the compensation of our executive officers and directors. The Compensation Committee is responsible for evaluating and approving the Company’s compensation plans and policies and for communicating the Company’s compensation policies to shareholders in our annual proxy statement. In fulfilling its duties, the Compensation Committee, among other things:
reviews and approves corporate goals and objectives relevant to the compensation of our CEO;
evaluates the performance and determines the annual compensation of the CEO in accordance with these goals and objectives;
reviews and approves the amounts and terms of the annual compensation for our other executive officers;
reviews and approves employment agreements, severance agreements or arrangements, retirement arrangements, change in control agreements/provisions and special supplemental benefits for the executive officers;
reviews and makes recommendations to the Board with respect to incentive based compensation plans and equity based plans, and establishes criteria for and grants awards to participants under such plans;
reviews and recommends to the Board the compensation for our directors; and
reviews and recommends to the Board that the Compensation Discussion and Analysis be included in the annual proxy statement and Form 10-K annual report.
The Board of Directors has adopted a written charter for the Compensation Committee that meets the applicable standards of the SEC and NASDAQ. The Compensation Committee Charter is published on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
The Compensation Committee is comprised of Dale A. Bruns, Chairman, Milburn Adams, Richard H. Ashley, Richard A. Buckheim and Jack E. Engelkes. The Board has determined that each member of the Committee satisfies independence requirements of the NASDAQ listing standards and Section 162(m) of the Internal Revenue Code of 1986, as amended.
The Compensation Committee charter authorizes the Committee to delegate to subcommittees of the Committee any responsibility the Committee deems necessary or appropriate. The Committee shall not, however, delegate to a subcommittee any power or authority required by any law, regulation or listing standard to be exercised by the Committee as a whole.
The Chairman, providesafter consulting with executive officers and others, makes recommendations to the Committee regarding the form and amount of compensation paid to oureach executive officers.officer. Additionally, the Chairman, the CEO and our Chief Financial Officer (“CFO”) regularly attend the Committee meetings other than executive sessions. Traditionally, management has providedand answer questions and provide information to the Committee historical and prospective breakdownsas requested. This normally includes a history of the primary compensation components for each executive officer, including an internal pay equity analyses.
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1. | review and discuss the recommendations made by the Chairman; | ||
2. | review the performance of the Company and the individual officers; | ||
3. | review the level to which the Company’s performance goals were attained and approve short-term cash bonus and long-term incentive awards; and | ||
4. | determine the executive officers’ base salaries for the following year. |
Management also advises the full Board, including the Committee members, throughout the year of new issues and developments regarding executive compensation.
Compensation Committee Interlocks And Insider Participation
During 2009,2012, Messrs. Bruns, Ashley, Buckheim and Engelkes served as members of the Compensation Committee. None of these four directors during 20092012 or at any previous time served as an officer or employee of Home BancShares or our bank subsidiary. During 2009,2012, none of our executive officers served as a director or member of the compensation committee (or group performing equivalent functions) of any other entity for which any of our independent directors served as an executive officer.See “CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS” for information concerning transactions during 20092012 involving Mr. Ashley.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee develops and maintains the corporate governance policies of the Company. The Committee’s responsibilities include, among other things:
developing and maintaining the Company’s corporate governance policies;
identifying, screening and recruiting qualified individuals to become Board members;
making recommendations regarding the composition of the Board and its committees;
assisting the Board in assessing the Board’s effectiveness;
assisting management in preparing the disclosures regarding the Committee’s operation to be included in the Company’s annual proxy statement; and
reviewing and approving all related party transactions required to be disclosed in our annual proxy statement.
The Board of Directors has adopted a written charter for the Nominating and Corporate Governance Committee that meets the applicable standards of the SEC and NASDAQ. The Nominating and Corporate Governance Committee Charter is published on our website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.”
The Nominating and Corporate Governance Committee is comprised of Alex R. Lieblong, Chairman, Robert H. Adcock, Jr., Dale A. Bruns and William G. Thompson. The Board has determined that all members of the Committee satisfy independence requirements of the NASDAQ listing standards. The Nominating and Corporate Governance Committee met on January 22, 2010,18, 2013, to select director nominees to be voted on at the Annual Meeting.
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Director Candidate Qualifications
The Nominating and Corporate Governance Committee Directorship Guidelines and Selection Policy outlines the qualifications the Committee looks for in a director nominee. Generally, the candidate should possess:
relevant business and financial expertise and experience, including an understanding of fundamental financial statements;
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the highest character and integrity and a reputation for working constructively with others;
More specifically, the Nominating Committee seeks candidates who possess various qualifications, skills, or other factors it deems appropriate. These factors may include leadership experience in business or other relevant fields, knowledge of the Company and the financial services industry, experience in serving as a director of another financial institution or public company generally, education, wisdom, integrity, analytical ability, familiarity with and participation in the communities served by the Company and its subsidiaries, commitment to and availability for services as a director, and any other factors the Committee deems relevant.
Director Nominations Process
After assessing and considering prevailing business conditions of the Company, legal and listing standard requirements for Board composition, the size and composition of the current Board, and the skills and experience of current Board members, any of the Chairman, the Nominating Committee or any Board member may identify the need to add a Board member or to fill a vacancy on the Board. The Committee identifies qualified director nominees from among persons known to the members of the Committee, by reputation or otherwise, and through referrals from trusted sources, including senior management, existing Board members, shareholders and independent consultants hired for such purpose. The Committee may request that senior officers of the Company assist the Committee in identifying and assessing prospective candidates who meet the criteria established by the Board.
The Nominating Committee evaluates candidates based upon the candidate’s qualifications, recommendations, or other relevant information, including a personal interview. The Nominating Committee has determined that the Board as a whole must have the right diversity, mix of characteristics and skills for the optimal functioning of the Board in its oversight of the Company. The Board believes it should be comprised of persons with skills in areas such as banking, finance, accounting, sales and marketing, law, strategic planning and leadership of large, complex organizations.
In addition to the targeted skill areas, the Nominating Committee looks for a strong record of achievement in key knowledge areas that it believes are critical for directors to add value to a Board including:
Strategy – knowledge of the Company business model, the formulation of corporate strategies, knowledge of key competitors and banking markets;
Leadership – skills in coaching senior executives and the ability to assist in their development;
Organizational issues – understanding of strategy implementation, management processes, group effectiveness and organizational design;
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Relationships – understanding how to interact with investors, regulatory bodies, and communities in which the Company operates;
Functional – understanding of finance matters, financial statements and auditing procedures, technical expertise, legal issues, information technology and marketing; and
Ethics – the ability to identify and raise key ethical issues concerning the activities of the Company and senior management as they affect the business community and society.
The Committee meets to consider and approve the candidates to be presented to the Board. The Committee then presents its proposed nominees to the full Board. The Board considers the recommendations of the Committee and approves candidates for nomination.
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Asset/Liability Committee
Our Asset/Liability Committee consists of Robert H. Adcock, Jr., John W. Allison, Richard H. Ashley, James G. Hinkle,Dale A. Bruns, Randy E. Mayor, and C. Randall Sims. Mr. Mayor serves as Chairman of the Asset/Liability Committee. The Asset/Liability Committee meets quarterly and is primarily responsible for:
development and control over the implementation of liquidity, interest rate and market risk management policies;
review of interest rate movements, forecasts, and the development of the Company’s strategy under specific market conditions; and continued monitoring of the overall asset/liability structure of our bank subsidiary to minimize interest rate sensitivity and liquidity risk. [The remainder of this page is intentionally left blank.] 17 DIRECTOR COMPENSATION The following table sets forth elements of compensation awarded to or paid by us to our non-employee directors during the fiscal year ended December 31, 2012: Director Compensation Table
During 2012, we paid each of our non-employee directors and our Chairman an annual retainer of $8,000. The chairmen of the holding company Audit and Compensation Committees received an additional annual retainer of $2,500 and $1,250, respectively. We paid each of our non-employee directors $2,000 for each meeting of the holding company Board attended and our Chairman of the Board $4,000 for each holding company Board meeting attended during 2012. Directors serving on the holding company Audit or Compensation Committees received $400 ($800 for the chairman) for each meeting attended of those committees. Directors serving on other holding company Board committees received $250 ($500 for the chairman) for each meeting attended of those other committees. Only our non-employee directors and our Chairman of the Board received committee attendance fees during 2012. On January 18, 2013, we awarded each non-employee director except Mr. Thompson 1,000 restricted shares of our common stock with a fair market value on the date of grant of $34.50 per share. These restricted shares will vest in three equal annual installments beginning on January 18, 2014. The compensation paid to our Chairman of the Board and our other employee directors is included in the Compensation Discussion & Analysis and the related executive compensation tables in this Proxy Statement. 18 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Banking Transactions. Most of our directors and officers, as well as the firms and businesses with which they or members of their immediate families are associated, are customers of our bank subsidiary. Our bank subsidiary and former bank subsidiaries have engaged in a variety of loan transactions in the ordinary course of business with individuals and their families and businesses, and it is anticipated that such transactions will occur in the future. In the case of all such related party transactions in 2012, each transaction was approved by either the Audit Committee, We believe that all extensions of credit by our bank subsidiary to its directors and officers and to directors and officers of the Company, either directly or as guarantors, were made in conformity with the requirements of Federal Reserve Board Regulation O. As of December 31, 2012, the aggregate amount outstanding on these loans, including available borrowings, was approximately $33.0 million, of which approximately $19.9 million was attributable to the largest borrowing relationship. None of these loans are nonaccrual, past due 90 days or more, restructured or potential problems. Real Estate Transactions. We lease certain of our properties from persons who are affiliated with us. The property used by our Marketing and Sales Department in Conway, Arkansas, is leased from First Real Estate LTD Partnership LLLP, which includes one of our directors, Robert H. Adcock, Jr. We believe the terms of each of the agreements are no less favorable to us than we could have obtained from an unaffiliated third party. We expect we will continue to engage in similar banking and business transactions in the ordinary course of business with our directors, executive officers, principal shareholders and their associates. All proposed related party transactions are presented to the Nominating and Corporate Governance Committee of our Board of Directors for consideration and approval. The Committee approved each of the transactions described above. The Committee does not currently have any formal policies or procedures with respect to its review, approval, or ratification of related party transactions, but considers each related party transaction or proposed related party transaction on a case-by-case basis. According to its charter, the Committee follows the definition of “related party transaction” provided in the SEC’s regulations under the Securities Act of 1933. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16 of the Securities and Exchange Act of 1934, as amended, requires each director, officer, and any individual beneficially owning more than 10 percent of the Company’s common stock to file reports on Forms 3, 4, and 5 disclosing beneficial ownership and changes in beneficial ownership of the common stock of the Company with the SEC within specified time frames. These specified time frames require the Form 3’s to be filed on or before the effective date of the issuer’s registration statement or within 10 days after the person becomes a reporting person. Changes in ownership must be filed on Form 4 within two business days of the transaction. Based solely on information provided to the Company by individual directors and officers, we believe that all our Section 16 filers complied with the filing requirements during the fiscal year, except as follows: One Form 4 report for John W. Allison 19 PRINCIPAL SHAREHOLDERS OF THE COMPANY The Information in this table is based upon “beneficial ownership” concepts described in the rules issued under the Securities Exchange Act of 1934. Under these rules, a person is deemed to be a beneficial owner of any shares of our common stock if that person has or shares “voting power,” which includes the power to vote or direct the voting of the shares, or “investment power,” which includes the right to dispose or direct the disposition of the shares. Thus, under the rules, more than one person may be deemed to be a beneficial owner of the same shares. A person is also deemed to be a beneficial owner of any shares as to which that person has the right to acquire beneficial ownership within 60 days from January 31, 2013. Except as otherwise indicated, all shares are owned directly, and the named person possesses sole voting and investment power with respect to his shares. The address for each of our directors and named executive officers is c/o Home BancShares, Inc., 719 Harkrider Street, Suite 100, Conway, Arkansas 72032.
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21 COMPENSATION DISCUSSION AND ANALYSIS Executive Summary The following Compensation Discussion and Analysis provides information regarding the Company’s compensation program for our “named executive officers.” Our “named executive officers” are our CEO, our CFO and our three other most highly-compensated executive officers, which for 2012 consisted of our Chairman, our Chief Lending Officer and a regional president of our bank subsidiary. Specific information regarding the compensation paid to each named executive officer during each of the past three years is disclosed in the Summary Compensation Table provided below. The following information includes an overview of our compensation philosophy and guiding principles, the components of our executive compensation, and a more detailed discussion of the compensation of our Chairman and our CEO. Our compensation program is designed to attract and retain key management for the Company and our bank subsidiary, motivate high performance with Salary payments to our named executive officers during 2012 ranged from $245,000 to $335,000, an increase of 8% to 10% for each named executive over his 2011 base pay. For 2012, we paid cash bonuses to each of the named executive officers ranging from 45% to 50% of the executive’s 2012 base salary, which represented at or near the maximum bonus amount for which each executive was eligible. Except for the period from June 2009 to July 2011 when the Company was subject to the compensation limitations imposed on participants in the Capital Purchase Program of the Troubled Asset Relief Program (“TARP”) of the U.S. Department of the Treasury (the “Treasury”), which prohibited us from paying bonuses to our senior executive officers, we have historically awarded annual cash bonuses to our named executive officers of approximately 10% to 50% of the executive’s base salary. The 2012 cash bonus awards were based primarily on the officers’ contributions to our record earnings during 2012. Additionally, in January 2012, we awarded each of our named executive officers a one-time bonus in connection with our bank subsidiary’s acquisition of certain assets and liabilities of Vision Bank, which was At our Annual Meeting in 2012, the
shareholders. 22 Overview of Compensation Philosophy and Program The Compensation Committee, composed entirely of independent directors, administers the Company’s executive compensation program. The role of the Committee is to oversee the Company’s compensation and benefit plans and policies, administer its stock plans, and review and approve annually all compensation decisions related to the The Committee recognizes the importance of compensation and performance and seeks to reward performance with cost-effective compensation that aligns employee efforts with the business strategy of the Company and with the interest of the shareholders. The Committee also recognizes that the compensation should assist the Company in attracting and retaining key executives critical to its long-term success. The following principles guide the Committee: Compensation levels should be sufficiently competitive to attract and retain key management for the bank and holding company. The Company hires experienced bank executives that have a track record in the market. Competition is strong for these talented and experienced people. The compensation package must be strong and competitive in that market.
Compensation should relate directly to performance and responsibility.Compensation should vary with the performance and responsibility of the individual. It should always be proportional to the contribution to the Company’s success. Short-term incentive compensation should motivate high performance.The Company uses the cash bonus plan to motivate individuals with roles and responsibilities that give them the ability to directly impact the Company’s performance and strategic direction. The incentive compensation should not cause the individual to take excessive and unnecessary risks that would threaten the institution. The Committee receives regular updates on our business results from management and reviews the quarterly financial statements and projections to assess whether executive compensation continues to be properly balanced with and supportive of our business objectives. The Committee may also Based on these reports and assessments, the Committee regularly evaluates both the short-term and long-term performance compensation for the named executive officers to ensure alignment with our business objectives. The Committee also works closely with management regarding long-term equity incentives, including performance based equity awards, which emphasize shareholder returns while providing enhanced retention value for key executives. 23 Benchmarking Against A Peer Group The Committee in the past has compared total compensation levels for the executive officers to the compensation paid to executives in a peer group. The Committee During 2010, the Committee engaged a compensation consultant, Longnecker & Associates (“Longnecker”), to conduct an independent executive compensation review and competitive market assessment of base salary, annual incentives, long-term incentives, executive benefits, perquisites and deferred compensation for our top six executives. Longnecker and its affiliates did not provide any non-compensation related services to the Company. The assessment selected a peer group of 15 public bank holding companies with asset and market capitalization size similar to the Company. These companies represent, in some cases, both business competition and a relevant labor market for our executives. The Committee has considered the results of the consultant’s review and the peer assessment in determining the compensation of our executives for each of the past three year but has not used a particular target or benchmark for our executive compensation based on the peer group. On January 27, 2012, the Committee approved base salary increases of $25,000 each for our Chairman and our CEO and $20,000 each for our other named executive officers for 2012, which represented increases of approximately 8% to 10% from each named executive’s 2011 base salary. In determining the 2013 executive compensation, the Committee again considered the results of the 2010 Longnecker assessment but did not perform a peer compensation review. The Committee evaluated and considered the overall performance of the Company and, for our regional bank presidents, the performance of the bank in each designated region, as well as the individual’s performance and recommendations by the Chairman.
officers, except our Chairman, who was awarded stock options in lieu of a salary increase.
At our Annual Meeting in 2012, the shareholders approved, on
Components of Compensation The key elements of the Company’s executive compensation program are: Base salary Short-term incentives (bonuses) Long-term incentive compensation (options/restricted stock) Retirement and insurance benefit plans Certain defined perquisites The Company tries to determine the proper mix of base, short-term and long-term incentive compensation. In our markets there are a number of national, regional and community banks. The competition for experienced executives in banking is strong. The Committee understands that being a public company that can offer equity incentives and a community banking philosophy 24 Base Salary Base salaries have been targeted at The Company
Short-term Incentives An annual cash bonus plan is intended to reward individual performance for that year. The Compensation Committee evaluates a number of performance criteria for the Company or the bank and considers the overall profitability of the Company before determining the awards. Specifically, the Compensation Committee reviews the individual performance of the officer, and if he or she is in charge of a banking region, the performance of that region. In evaluating a regional bank president, the Committee reviews the goals for that banking region, including return on assets, growth in assets, asset quality, return on equity, gross margin, net income, operating income, net cash flow and regulatory examination results. In evaluating an executive officer of the parent, the Committee reviews the goals of the parent company including shareholder return, earnings per share, and the other criteria noted above. The final consideration is the overall profitability of the Company. The Committee then determines the amount of the awards. Historically, the July 2011 when the Company was a participant in the Treasury’s TARP Capital Purchase Program and was prohibited from paying bonuses to our senior executives. The Committee awarded cash bonuses for 2012 to each of our named executive officers in amounts that ranged from 45% to 50% of the executive’s 2012 base salary. These amounts were at or near the maximum bonus award for which each executive was eligible. The awards were based primarily on each executive’s contribution to the Company’s financial performance during 2012, which consisted of four consecutive quarters of record net income and earnings per share, including increases of 16.4% to 20.4% in quarterly net income available to common shareholders over the corresponding periods in 2011. The Committee in January 2012 also awarded a special one-time cash bonus to each of our named executive officers in connection with our bank subsidiary’s acquisition of certain assets and liabilities of Vision Bank. These bonuses were paid upon the completion of the acquisition in February 2012. The one-time bonus amount for each executive other than our Chairman was 15% of the executive’s 2011 base salary, payable in cash, and for our Chairman was 25% of his 2011 base salary, payable in shares of our common stock. Long-term Incentives Consistent with the Company’s philosophy that favors compensation based upon performance, long-term incentives comprise a significant component of total compensation. In 25 It is the policy of the Committee to award grants with an exercise price set at the fair market value on the date of the grant. The Company does not have a practice of timing option or restricted stock grants to coordinate with the release of material non-public information. The Committee evaluates opportunities under the Plan along with the annual setting of salaries and awarding bonuses. The Committee will also consider awards under the Plan if appropriate in recruiting a new employee. The Committee uses one or more of the following business criteria, on a consolidated basis and/or with respect to specified shareholder return; return on assets; growth in assets; asset quality; return on equity; earnings per share; net income; and operating income. Section 162(m) of the Internal Revenue Code places a limit of $1,000,000 on the compensation that publicly held corporations may deduct in any one year with respect to each of its five most highly paid executive officers. There is an exception to the $1,000,000 limitation for performance-based compensation meeting certain requirements. Annual cash incentive compensation and stock option
Historically, the The Compensation Committee may also grant restricted stock In August 2012, the 26 The Restricted Shares will vest entirely (or “cliff” vest) on the third annual anniversary of the grant date, and the Performance Shares will “cliff” vest on the third annual anniversary of the date that the performance goal is met. The performance goal consists of a targeted average of $0.625 diluted earnings per share or cumulative $2.50 diluted earnings per share over a four consecutive quarter period. The performance goal will be met as of the end of the calendar quarter when the Company has reached the targeted average or cumulative diluted earnings per share for four consecutive quarters. The Committee will have final approval to On January 18, 2013, the Committee granted stock options representing a total of 35,000 shares of our common stock at an exercise price of $34.50 per share to our Chairman and the regional president of our bank subsidiary for our Florida and Alabama region, including options to purchase 25,000 shares to our Chairman and options to purchase 10,000 shares to the regional bank president, who is not a named executive officer for 2012. These
Retirement and Insurance Benefits Post-Termination Benefits.We do not have any employment, salary continuation, or severance agreements currently in effect for any of our executive officers. Chairman’s Retirement Plan.In 2007, our Board of Directors, based on a recommendation by the Compensation Committee, approved a Chairman’s Retirement Plan for our Chairman, John W. Allison. The Chairman’s Retirement Plan provides a supplemental retirement benefit to Mr. Allison of $250,000 per year for 10 consecutive years or until Mr. Allison’s death, whichever occurs later. The benefits under the plan greater. If Mr. Allison Supplemental Executive Retirement Plan.Prior to our acquisition of Community Bank, the bank purchased life insurance policies on its President and Chief Executive Officer, Tracy M. French. The policies offset benefit expenses associated with a supplemental annual retirement benefit that grows on a tax-deferred basis. A portion of the benefit is determined by an indexed formula. The balance of the benefit is determined by crediting interest on the accrued balances. The calculation for the benefit expense accrual is: insurance policy income minus opportunity cost plus interest. The opportunity cost is determined by the bank and is equal to the five year average of the one year Treasury Bill rate. The bank (now Centennial Bank) retains the opportunity cost. Prior to Mr. French’s retirement, any earnings in excess of the opportunity costs are accrued to a liability reserve account for his benefit. 27 The life insurance benefit for Mr. French is being provided by an endorsement split dollar life plan. Upon the death of the executive, the death benefit payable is equal to 70% of the net
2012. Health and Insurance Benefits.Our full-time officers and employees are provided hospitalization and major medical insurance. We pay a substantial part of the premiums for these coverages. All insurance coverage under these plans is provided under group plans on generally the same basis to all of our full-time employees. Also, we provide other basic insurance coverage including dental, life, and long-term disability insurance. In 2004, First State Bank (now Centennial Bank) adopted an endorsement
Perquisites The Company provided certain perquisites to executive management in 401(k) contributions Country club dues Gasoline for personal car Car allowance Use of company owned car The Company does not own its own airplane, but does use an airplane owned by Mr. Allison’s company, Capital Buyers. An employee of the Company is a pilot and flies the airplane. Mr. Allison also uses the pilot for personal travel which may or may not occur during working hours. When the Company uses the plane, Capital Buyers charges the Company for out of pocket expenses and other expenses attributable to use and maintenance of the aircraft. Compensation of the Chairman Overview. On October 17, 2008, based on a recommendation by the Compensation Committee, the Board of Directors granted Mr. Allison, who was then our Chairman and Chief Executive Officer, an annual base salary of $275,000 beginning on November 1, 2008, and made him eligible for an annual discretionary cash bonus. Any cash bonus will be based upon the goals of the Company including shareholder return, earnings per share and other criteria. 28 On July 17, 2009, the Board of Directors promoted C. Randall Sims to Chief Executive Officer, with Mr. Allison remaining as Chairman of the Board. In connection with this change, the Board determined that Mr. Allison should continue to receive an annual salary of $225,000 for his services to the Company and to be eligible for an annual discretionary cash bonus based on the previously described Salary and Short-Term Incentive Compensation. During
Long-Term Incentive Compensation. Mr. to purchase 10,000 shares of our common stock at an exercise price of $34.50 per share. These stock options will vest in five equal annual installments beginning on January 18, 2014. These options are in addition to the options to purchase 15,000 shares of our common stock described above which were granted to Mr. Allison on the same date in lieu of a salary increase. Chairman’s Retirement Plan. In April 2007, our Board of Directors, based on a recommendation by the Compensation Committee, approved a Chairman’s Retirement Plan for Mr. Allison, which provides him a supplemental retirement benefit of $250,000 per year for 10 consecutive years or until Mr. Allison’s death, whichever occurs later. The benefits under the plan Director Fees. Mr. Allison receives an additional fee for his service as Chairman of the Board of Directors of the Company. The fee for his service as Chairman of the Board is set by the Board of Directors. In addition, Mr. Allison is Chairman of the board of directors of the Company’s subsidiary bank and serves on each regional board of directors of the bank. He receives a fee for his service on the board of directors and each regional board of the bank. The fees for his service on each board are set by the respective boards of the bank. Mr. Allison earned a total of $54,644 in fees for his service on the Board of Directors of the Company and the board of directors and regional boards of the bank during 2012, including fees for his service on committees of the Company and bank boards. Perquisites. Mr. Allison annually receives certain perquisites from the Company. The perquisites provided to Mr. Allison during 2012 included the use of a pilot employed by the Company for personal trips in an airplane owned by a company owned by Mr. Allison, an auto allowance, payments for gasoline for Mr. Allison’s personal car, payment of country club dues, Company-owned life insurance and discretionary executive gifts. The amounts of these perquisites are disclosed below under “EXECUTIVE COMPENSATION – Summary Compensation Table.” 29 Compensation of the Chief Executive Officer Salary and Short-Term Incentive Compensation. During 2012, Mr. Sims received $335,000 as salary from the Company, an increase Long-Term Incentive Compensation. Mr. Sims has in the past received Perquisites. Mr. Sims annually receives certain perquisites from the
30 REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS The following Compensation Committee Report should not be deemed filed or incorporated by reference into any other document, including the Company’s filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this Report into any such filing by reference. In accordance with its written charter, which was re-adopted in its current form by the Board of Directors on January The Committee met 2012. In determining the compensation of the executive officers for 2012. The Compensation Committee reviewed and discussed with management the information provided in the preceding Compensation Discussion and Analysis section of this Proxy Statement. Based on its review and discussions with management, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and our Annual Report on Form 10-K for the calendar year ended December 31,
Home BancShares, Inc. Compensation Committee Members Dale A. Bruns, Chairman Milburn Adams Richard H. Ashley Richard A. Buckheim Jack E. Engelkes 31 EXECUTIVE COMPENSATION The following table sets forth various elements of compensation awarded to or paid by us for services rendered in all capacities by our CEO, our CFO and our three other most highly-compensated executive officers, our “named executive officers,” during the fiscal year ended December 31,
Summary Compensation Table
32 Employment Agreements We currently do not have any employment, salary continuation or severance agreements in effect with any of our executive officers. Stock Awards and Stock Option Grants The number of shares authorized for issuance under the Home BancShares Amended and Restated 2006 Stock Option and Performance Incentive Plan, as 2012. On January 18, 2013, the Company granted stock options representing a total of 35,000 shares of our common stock to our Chairman and an officer of the Company who is not a named executive officer and a total of 11,000 shares of restricted stock to our non-employee directors and an officer of the Company who is not a named executive officer. As of February 15, 2013, options to purchase 468,728 shares remain outstanding under the Plan, and 857,041 shares of common stock remain available for future awards under the Plan. The following table contains information 2012: Grants of Plan-Based Awards Table
The Company does not currently have a policy regarding repricing of stock options. [Table follows on next page.] 33 The following table contains information, on a stock dividend adjusted basis, about unexercised stock options previously granted to each of our named executive officers that are outstanding as of December 31,
Outstanding Equity Awards at Fiscal Year-End Table No. 1
34 The following table contains information about the restricted stock awards previously granted to each of our named executive officers that are outstanding as of December 31,
Outstanding Equity Awards at Fiscal Year-End Table No. 2
35 Option Exercises and Stock Awards Vested in 2012 The following table contains information about stock options exercised by each of our named executive officers during 2012. Option Exercises and Stock Awards Vested Table
Pension and Other Benefits The following table contains information about the actuarial present value of the accumulated benefit to each of our named executive officers under each plan in which the named executive officer participates that provides for the payment of specified retirement benefits or benefits that will be paid primarily following retirement:
Pension and Other Benefits Table
See Nonqualified Deferred Compensation We do not currently have in effect any defined contribution or other plan that provides for the deferral of compensation to any of our executive officers on a basis that is not tax-qualified. Payments Upon Termination or Change-In-Control We do not currently have in effect any compensatory plan or other arrangement that provides for payments or the provision of benefits to any of our executive officers 36 Compensation Risk Assessment The Compensation Committee and management conducted an assessment of During the review, the Committee and management concluded that several factors and controls relating to our compensation policies and practices mitigate against the potential for risks that could materially and adversely affect the Company. These factors and controls include: the Company’s lack of involvement in activities regarded as having significant inherent risk, such as mortgage-backed securities and proprietary trading; management’s review of compensation arrangements of employees of the Company or our bank subsidiary having compliance, risk, credit quality, quality assurance and finance roles; oversight of incentive compensation by the Compensation Committee, which is made up of independent directors; effective internal controls over financial reporting for the Company; appropriate segregation of duties; and restrictions on awards that align the interests of the employee with the interests of the shareholders. Based upon this assessment, we do not believe that our employee compensation policies and practices create risks that are reasonably likely to have a material adverse effect on the
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37 PROPOSAL TWO – ADVISORY (NON-BINDING) VOTE APPROVING EXECUTIVE COMPENSATION The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) enables our shareholders to vote to approve, on an advisory (non-binding) basis, the compensation of our We value the endorsement by our shareholders of our We encourage you to closely review our Compensation Discussion and Analysis and the tabular disclosure which follows it, including the footnotes and narratives which accompany each table, as they describe our compensation policies and procedures and the components and amounts comprising the compensation paid to our named executive officers. The “RESOLVED, that the shareholders of Because your vote is advisory, it will not be binding upon the Board of Our Board of Directors and our Compensation Committee believe that our commitment to responsible compensation practices as described in this Proxy Statement justifies a vote by shareholders FOR the resolution approving the compensation of our executives as disclosed in this Proxy Statement. The Board of Directors Recommends that Shareholders Vote FOR the Advisory (Non-binding) Resolution Approving the Company’s Executive Compensation 38 PROPOSAL THREE – APPROVAL OF AMENDMENT TO ARTICLES OF INCORPORATION TO INCREASE NUMBER OF AUTHORIZED SHARES General Our Restated Articles of Incorporation, as amended,
shares were subject to stock options available for future grant, leaving shares available for other uses. The The authorized capital stock (the “Capital Stock”) of this Corporation shall be 100,000,000 shares of voting common stock (the “Common Stock”) having a par value of $0.01 per share, and Purpose and Effect of the Proposed Amendment The Board believes that the current number of authorized shares does not provide the Company with adequate flexibility to issue stock in connection with any future acquisitions or for general corporate purposes. In particular, if the Board determines that it would be appropriate to effect a significant acquisition through the exchange of common stock, conduct a stock offering or declare a dividend or split, the current number of unissued authorized shares might not be enough to complete such transaction. Although we cannot guarantee that any future acquisitions, stock offerings, dividends or splits will occur, the Board believes that the proposed increase in the number of authorized shares will provide the Company with the flexibility necessary to maintain a reasonable stock price through future stock dividends or splits, or to issue shares in connection with an acquisition or other corporate purpose, without incurring the expense of convening a special shareholder’s meeting or the delay of waiting until the next annual meeting. If this proposal is approved, all authorized but unissued shares of common stock will be available from time to time for any proper purpose approved by the Board, including issuances in connection with stock-based benefit plans, future stock splits or dividends and issuances to raise capital or effect acquisitions. Neither the Company nor the Board currently has any arrangements or understandings with respect to the issuance or use of the additional shares of authorized common stock sought to be approved (other than issuances permitted or required under the Company’s Amended and Restated 2006 Stock Option and Incentive Plan or awards made pursuant to that plan). If this proposal is approved, all or any of the shares may be issued without further shareholder action, unless required by law or the rules of the NASDAQ Stock Market. Existing shareholders do not have preemptive or similar rights to subscribe for or purchase any additional shares of common stock that the Company may issue in the future. Therefore, issuances of common stock other than issuances on a pro rata basis to all shareholders would reduce each shareholder’s proportionate interest in the Company. An increase in the authorized number of shares of 39 Vote Required to Approval of the The Board of Directors Recommends that Shareholders Vote FOR Approval of the Amendment to to
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PROPOSAL INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Our consolidated financial statements as of and for the fiscal year ended December 31, Shareholders’ ratification of the selection of BKD, LLP to be our independent registered public accounting firm for fiscal year Representatives of BKD, LLP are expected to attend the Annual Meeting, will have an opportunity to make a statement if they so desire, and will be available to respond to appropriate questions. The Board of Directors Recommends that Shareholders Vote FOR the Ratification of the Appointment of BKD, LLP as the Company’s Independent Registered Public Accounting Firm for the REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS In accordance with its written charter, which was re-approved in its current form by the Board of Directors on January 18, 2013, the Audit Committee assists the Board in, among other things, oversight of our accounting and financial reporting processes, our compliance with legal regulatory requirements, the qualifications and independence of the independent auditors and the performance of the internal and independent auditors. A copy of the Audit Committee charter is published on the Company’s website atwww.homebancshares.comunder the caption “Investor Relations”/“Corporate Profile”/“Governance Documents.” Our Board of Directors has determined that all six members of the Committee are independent based upon the independence requirements of the SEC and NASDAQ, and that our Chairman, Mr. Engelkes, satisfies the criteria of an “audit committee financial expert” as defined by the regulations of the SEC. Management is responsible for the preparation, presentation, and integrity of our financial statements, for the appropriateness of our accounting principles and reporting policies and for implementing and maintaining internal control over financial reporting. Our independent auditors are responsible for auditing the financial statements and internal controls over financial reporting and for reviewing our unaudited interim financial statements. The Audit Committee’s responsibility is to monitor and review these processes and procedures. Except for our Chairman, Mr. Engelkes, the members of the Audit Committee are not engaged in the practice of accounting or auditing and are not professionals in those fields. The Audit Committee relies, without independent verification, on the information provided to us and on the representations made by management that the financial statements have been prepared with integrity and objectivity and on the representations of management and the opinion of the independent auditors that such financial statements have been prepared in conformity with accounting principles generally accepted in the United States. 41 During 2012, the Audit Committee had four regularly scheduled meetings and one special meeting. The Audit Committee’s regular meetings were conducted in order to encourage communication among the members of the Audit Committee, management, the internal auditors, and our independent auditors, BKD, LLP. Among other things, the Audit Committee discussed with our internal and independent auditors the overall scope and plans for their respective audits. The Audit Committee separately met with each of the internal and independent auditors, with and without management, to discuss the results of their examinations and their observations and recommendations regarding our internal controls. The Audit Committee also discussed with our independent auditors all matters required by auditing standards generally accepted in the United States of America, including those described in Auditing Standards AU Section 380, “Communication with Audit Committees.” The Audit Committee reviewed and discussed our audited consolidated financial statements as of and for the year ended December 31, 2012, with management, the internal auditors, and our independent auditors. Management’s discussions with the Audit Committee included a review of critical accounting policies. The Audit Committee obtained from the independent auditors a formal written statement describing all relationships between us and our auditors that might bear on the auditors’ independence consistent with Public Company Accounting Oversight Board Rule 3526, “Communication with Audit Committees Concerning Independence.” The Audit Committee discussed with the auditors any relationships that may have an impact on their objectivity and independence and satisfied itself as to the auditors’ independence. The Audit Committee has reviewed and approved the amount of fees paid to BKD, LLP for audit and non-audit services. The Audit Committee concluded that the provision of services by BKD, LLP is compatible with the maintenance of BKD’s independence. Based on the above-mentioned review and discussions with management, the internal auditors, and the independent auditors, and subject to the limitations on our role and responsibilities described above and in the Audit Committee Charter, the Audit Committee recommended to the Board of Directors that our audited consolidated financial statements be included in our Annual Report on Form 10-K for the calendar year ended December 31, 2012, for filing with the SEC. Home BancShares, Inc. Audit Committee Members Jack E. Engelkes, Chairman Milburn Adams Robert H. Adcock, Jr. James G. Hinkle Alex R. Lieblong William G. Thompson AUDIT AND NON-AUDIT FEES The following table represents aggregate fees billed for professional audit services rendered by BKD, LLP to provide the audit of our annual consolidated financial statements for the years ended December 31,
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Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditor The Audit Committee has the responsibility of appointing, setting compensation for and overseeing the work of the independent auditor, and has established a policy to pre-approve all audit and permissible non-audit services provided by the independent auditor. Prior to engagement of the independent auditor for next year’s audit, management will submit an aggregate of services expected to be rendered during that year for each of four categories of services to the Audit Committee for approval.
Prior to the engagement, the Audit Committee pre-approves these services by category of service. The fees are budgeted and the Audit Committee requires the independent auditor and management to report actual fees versus the budget periodically throughout the year by category of service. During the year, circumstances may arise when it may become necessary to engage the independent auditor for additional services not contemplated in the original pre-approval. In those instances, the Audit Committee requires specific pre-approval before engaging the independent auditor. The Audit Committee may delegate pre-approval authority to one or more of its members. The members to whom such authority is delegated must report, for informational purposes only, the pre-approval decisions to the Audit Committee at its next scheduled meeting.
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SUBMISSION OF SHAREHOLDER PROPOSALS In order for a proposal by a shareholder to be presented at an annual meeting of our shareholders, the proposal must be included in the related proxy statement and proxy form. Proposals by shareholders intended to be presented at the Annual Meeting of Shareholders in For a shareholder proposal to be included in the proxy statement and proxy form for an annual meeting of the Company’s shareholders, the proposal must: (1) concern a matter that may be properly considered and acted upon at the annual meeting in accordance with applicable laws, including our Bylaws and Rule 14a-8 of the Securities WHERE YOU CAN FIND MORE INFORMATION We file reports, proxy statements, and other information with the SEC. You can read and copy these reports, proxy statements, and other information concerning the Company at the SEC’s public reference room at 100 F Street N.E., Washington, D.C., 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. You may also view and print reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including the Company, from the SEC website atwww.sec.gov. SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING ARE URGED TO VOTE BY TELEPHONE, MAIL OR INTERNET. IF YOU VOTE BY TELEPHONE OR THE INTERNET, DONOTRETURN YOUR PROXY CARD
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Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
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![]() 719 Harkrider Street, Suite 100 Conway, Arkansas 72032 (501) 328-4770 www.homebancshares.com NOTICE OF ANNUAL MEETING OF SHAREHOLDERS To Be Held on April 18, 2013 The undersigned constitutes and appoints Randy E. Mayor and Brian S. Davis or either of them, proxies for the undersigned, with full power of substitution, to represent the undersigned and to vote all of the shares of common stock of Home BancShares, Inc. which the undersigned is entitled to vote at the Annual Meeting of shareholders of the Company to be held on April Only shareholders of record on March YOUR VOTE IS IMPORTANT PLEASE EXECUTE YOUR PROXY WITHOUT DELAY
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