Item 5.02.Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Amended and Restated Employment Agreements
On February 19, 2021, the Compensation Committee (the “Compensation Committee”) of the Board of Directors (the “Board”) of HBT Financial, Inc. (the “Company”) approved amended and restated employment agreements (the “Amended and Restated Employment Agreements”) for the Company’s executive officers, including each of the named executive officers: Fred. L. Drake, the Company’s Chairman and Chief Executive Officer, J. Lance Carter, the Company’s President and Chief Operating Officer, and Patrick F. Busch, the Company’s Executive Vice President and Chief Lending Officer (each an “NEO” and collectively, the “NEOs”). The Amended and Restated Employment Agreements amend and restate the employments agreements entered into with each of the NEOs on October 1, 2019.
The Amended and Restated Employment Agreements extend the initial term of the employment agreements from December 31, 2022 to December 31, 2023, with automatic one-year renewals beginning at the end of the initial term as so extended, unless either party chooses not to renew. The initial annual base salaries under the Amended and Restated Employment Agreements, which are reviewed annually for adjustment by the Board, are $575,700 for Mr. Drake, $454,500 for Mr. Carter and $433,038 for Mr. Busch. The NEOs are eligible to earn a performance-based annual incentive bonus based on the achievement of reasonable performance goals, and beginning in 2021, each NEO is eligible to receive an annual long-term incentive award (“LTI award”), subject to the discretion of the Board or its designee. Each NEO’s target bonus opportunity for 2021 was set at 40% of base salary, and each NEO’s target LTI award opportunity for 2021 was set at 40% of base salary. In addition, the NEOs are entitled to participate in the benefit plans generally available to Company executives.
Under the Amended and Restated Employment Agreements, upon a termination by the Company without “cause” or by NEO for “good reason” (each as defined in the agreement), each NEO is eligible to receive severance benefits. If the termination is within 12 months after a “change in control” (as defined in the agreement), the NEO is entitled to a lump sum payment equal to two times the sum of such NEO’s base salary and target bonus, plus a lump sum payment equal to the cost of 18 months of continued COBRA coverage. If the termination is not within 12 months after a change in control, the NEO is entitled to continued base salary for six months after termination. All severance benefits under the agreements are conditioned upon the NEO’s execution of a release of claims against the Company and its affiliates.
The Amended and Restated Employment Agreements contain confidential information, non-competition, and employee and customer non-solicitation restrictive covenants. The confidential information covenant is perpetual. The non-competition and non-solicitation covenants run during employment and for six months after an involuntary termination not in connection with a change in control, six months after a disability termination, 12 months after a termination for cause or a voluntary termination, and 24 months after an involuntary termination within 12 months of a change in control.
Copies of the Amended and Restated Employment Agreements with Mr. Drake, Mr. Carter and Mr. Busch are filed as Exhibits 10.1, 10.2 and 10.3, respectively, and are incorporated herein by reference. The foregoing description is qualified in its entirely by reference to the full text of the Amended and Restated Employment Agreements.
RSU and Performance RSU Award Agreements
In addition, on February 19, 2021, the Compensation Committee adopted a new form of RSU Award Agreement (the “RSU Agreement”) and a new form of Performance RSU Award Agreement (the “PRSU Agreement”) to make LTI awards under the HBT Financial, Inc. Omnibus Incentive Plan (the “Plan”), as contemplated by the Amended and Restated Employment Agreements.
The RSU Agreement provides for the grant of restricted stock unit awards (“RSUs”) consisting of the right to receive, upon the vesting date, one share of common stock of the Company for each vested RSU. The vesting of the RSUs is subject to the grantee’s continued employment or service through the vesting date. Dividend equivalents on the RSUs will accumulate and will vest and be paid at the time the RSU vests.
