PROPOSAL NO. 4: PROPOSED AMENDMENT TO SECOND RESTATED ARTICLES OF INCORPORATION TO PROVIDE FOR THE DECLASSIFICATION OF THE BOARD OF DIRECTORS
The Company’s Board has adopted and approved, and is submitting for shareholder approval, an amendment (the “Proposed Amendment”) to the Company’s Second Amended and Restated Articles of Incorporation (“Articles”) to provide for the phased elimination of the classified board structure and instead to require the annual election of all directors.
The Board believes that its classified structure has helped provide stability, experience and focus on long-term shareholder value, accountability to shareholders, enhancement of Board independence and protection of shareholder value. Although these are important benefits, the Board recognizes the growing sentiment among shareholders and the investment community in favor of annual elections and has considered the views of the shareholders as expressed in the vote to declassify the Board at the 2017 annual meeting. After careful consideration, the Board has approved and adopted, and recommends that the shareholders approve, the Proposed Amendment.
Appendix III
shows the proposed changes to Article VI of the Articles, with deletions indicated by strikeouts and additions indicated by underlining.
Required Vote
The Proposed Amendment will be approved if the number of shares of common stock voting for the Proposed Amendment exceeds the number of shares voting against the Proposed Amendment. If the proposal is approved by the required shareholder vote, the Articles will be amended as set forth in
Appendix III
. If the proposal is not approved by the requisite vote of shareholders, the Board will remain classified and the directors will continue to be elected to serve three-year terms as provided for in the current Articles. Abstentions will have the effect of a vote against this proposal.
If no voting specification is made on a properly returned or voted proxy card, the proxies named on the proxy card will vote FOR the Proposed Amendment to the Company’s Second Amended and Restated Articles of Incorporation to provide for the phased-in declassification of the Board of Directors as described in this Proposal No. 4.
Legal Effect
If the Proposed Amendment is approved by the requisite vote of shareholders, the Articles will be amended to reflect the revisions set forth in
Appendix III
, and the resulting Amendment will be filed with the Secretary of State of the Commonwealth of Kentucky shortly after the Annual Meeting. The Board will adopt corresponding amendments to the Company’s Bylaws conditioned upon shareholder approval of the Proposed Amendment.
Impact on Future Elections
If the Proposed Amendment is adopted, directors standing for election beginning at the 2019 annual meeting will be elected to one-year terms of office. Directors who have been elected to three-year terms prior to the effectiveness of the Proposed Amendment would complete their respective three-year terms, and thereafter would be eligible for annual re-election after completion of their current terms. In addition, until the Board is completely declassified, any director appointed to the Board as a result of an increase in the size of the Board or to fill a vacancy on the Board will hold office until the next election of the class for which such director is chosen; thereafter, any director so appointed will hold office until the next annual meeting.
Accordingly, directors elected at this year’s Annual Meeting will serve for a three-year term expiring at the annual meeting in 2021, and directors currently serving terms that end at the annual meetings in 2019 and 2020 will continue to serve for such terms. If the Proposed Amendment is approved, all directors will be elected on an annual basis beginning with the 2021 annual meeting. In all cases, each director will hold office until his or her successor has been elected and qualified or until the director’s earlier resignation or removal.
For the reasons discussed above, the Board of Directors recommends a vote FOR the proposed amendment to the Company’s Second Amended and Restated Articles of Incorporation to provide for the phased-in declassification of the Board of Directors.
|
(1)
|
|
Represents performance units issued under the 2015 Incentive Compensation Plan. The performance factors applicable to these grants are return on average assets, ratio of non-performing assets to total assets and ratio of net charge-offs to average total loans. At the threshold performance level, the officer would receive 0% of the shares shown; at the target performance level, the officer would receive 100% of the shares shown; and at the maximum performance level, he would receive 150% of the shares shown. For performance greater than the threshold level but less than the maximum level the number of shares would be based upon interpolation between the closest performance points. Awards will be settled in shares of the Company’s common stock.
|
|
(2)
|
|
Represents performance units earned over a three-year performance period ending December 31, 2017. The executive officers’ interest in the earned units vested on the distribution date of March 15, 2018 following the filing of the Company’s 2017 Form 10-K .
|
|
(3)
|
|
Market value is determined by multiplying the closing market price of the Company’s common stock on December 31, 2017 by the number of shares issuable upon achievement of the target performance goal.
|
|
(4)
|
|
Performance units are earned over three-year performance periods ending December 31, 2018 and 2019 based on goals. The executive officers’ interest in any earned shares will vest on the distribution date which will be as soon as practicable following the filing of the Company’s 2018 Form 10-K with respect to units earned over the three-year period ending December 31, 2018 and as soon as practicable following the filing of the company’s 2019 Form 10-K with respect to units earned over the three-year period ending December 31, 2019.
|
Incentive Compensation Plan.
The Board of Directors adopted the Citizens First Corporation 2015 Incentive Compensation Plan on December 18, 2014 and the Plan was approved by the shareholders at the 2015 annual meeting of shareholders.
Under the Incentive Compensation Plan, the Compensation Committee of the board, in its discretion, may grant an award under the plan to any employee of the Company or an affiliate. Subject to adjustment as described below, the maximum number of shares of the Company’s common stock that may be issued or transferred pursuant to awards under the plan is the sum of the following: 100,000 shares plus any shares covered by an award that are forfeited or remain unpurchased or undistributed upon termination or expiration of an award under the Plan. In the event of any stock split, stock dividend, spin-off, or other relevant change affecting the Company’s common stock, the Compensation Committee may adjust the number of shares available for grants and the number of shares and price under outstanding grants made before the event, as provided in the Plan.
The Incentive Compensation Plan is administered by the Compensation Committee, which has broad discretionary authority under the Plan. The Compensation Committee may delegate all or any part of its authority and powers under the plan to one or more directors or officers of the Company. However, the Compensation Committee may not delegate its authority and powers with respect to grants to persons covered by Section 16 of the Securities Exchange Act of 1934 in a way that would jeopardize the Plan’s satisfaction of Rule 16b‑3 of the Securities Exchange Act of 1934, or with respect to grants intended to constitute “performance based compensation.”
Subject to the limits imposed by the Plan and described below, the Compensation Committee, in its discretion, may award any of the following types of awards to any employee: (i) incentive stock options, (ii) nonqualified stock options, (iii) stock appreciation rights, (iv) restricted shares, (v) unrestricted shares, (vi) performance shares, (vii) performance units, and (viii) restricted stock units.
The Compensation Committee may condition awards on the achievement of certain objective performance measures established by the Compensation Committee during the first 90 days of the award’s performance period. The performance measures will be based on any of the factors listed below, alone or in combination, as determined by the Compensation Committee. Such factors may be applied on a corporate-wide or business-unit basis, include or exclude one or more of the Company’s subsidiaries, may be in comparison with plan, budget or prior performance, and/or may be on an absolute basis or in comparison with peer-group performance. Performance measures may differ from participant to participant and from award to award. The factors that may be used as performance measures will be one or more of the following: interest income; net interest income; interest expense; net interest margin; non-interest income; fee income; revenues; securities gains or losses; other income; deposits; deposit growth; deposit market share; non-interest expense;
The amount of cash incentive payments under the Management Incentive Plan is based entirely on the achievement of pre-established performance goals. These payout levels are determined by the Compensation Committee after reviewing peer and survey data. Performance measures under the Management Incentive Plan include:
|
·
|
|
total shareholder equity;
|
|
·
|
|
earnings per share; and
|
|
·
|
|
total shareholder return.
|
Under the terms of the Management Incentive Plan, in 2017 the named executive officers were eligible to receive incentive compensation based on the achievement of certain Company performance objectives (weighted at 20% to 30%). The target bonus levels were 30% of base salary for the CEO and 25% for each of the other named executive officers. Each named executive officer’s bonus under the plan is based upon the achievement of the Company performance objectives listed below. The Company’s 2017 performance goals were as follows, with the earnings per share objective weighted 30%, the efficiency ratio weighted 20%, and the non-performing asset ratio and return on average asset ratio each weighted 25%:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Performing
|
|
|
|
|
|
|
|
Earnings Per
|
|
Assets to Total
|
|
Return on
|
|
Efficiency
|
|
|
|
Share
|
|
Assets
|
|
Average Assets
|
|
Ratio
|
|
Threshold
|
|
$
|
1.65
|
|
0.85
|
%
|
0.96
|
%
|
67.99
|
%
|
Target
|
|
$
|
1.78
|
|
0.50
|
%
|
0.97
|
%
|
65.61
|
%
|
Maximum
|
|
$
|
1.84
|
|
0.25
|
%
|
1.00
|
%
|
65.12
|
%
|
The Company exceeded the target objective for each performance goal. Total incentive compensation for 2017 under the Management Incentive Plan was approximately $287,832. The amounts payable to each of our named executive officers under our Management Incentive Plan is set forth under the column “Non-Equity Incentive Plan Compensation” in the Summary Compensation Table.
Employment Agreements.
The Company has entered into employment agreements with each named executive officer. The agreements dated October 19, 2017 are summarized below.
The summary is qualified in its entirety by reference to the agreements themselves, copies of which are available from the Company itself or from the Company’s public filings with the SEC.
Each employment agreement is for a term of three years and will be automatically renewed for successive one year terms unless either party gives 60 days’ notice to the other of its intent not to renew. Each of the agreements provides for payment to the named executive officer of an annual salary and participation in all employee benefit programs including paid time off as are offered by the Company to its other executive officers.
The agreements may be terminated by the Company immediately for cause (as defined in the agreement) or upon 60 days prior notice without cause. In the event the agreement is terminated with cause, the named executive officers will not be entitled to any further compensation following written notice of termination. In the event the agreement is terminated without cause, the Company will be obligated to pay the officer an amount equal to one year of base salary plus the value of accrued fringe benefits through the date of termination and shall pay the premiums required to maintain health insurance coverage for the officer and his dependents until the earliest of the first anniversary of the termination of employment or the date on which the officer is included in another employer’s benefit plans.
Pursuant to each of the employment agreements, in the event that the named executive officer’s s employment is terminated by the Company for any reason other than cause within six months prior to a Change in Control, or on or within one year following a Change in Control (as defined in the agreement), the Company will pay the officer an amount equal to two times the officer’s base salary, an amount equal to the “target” annual incentive under any outstanding award
SHARE OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following table sets forth information as of March 16, 2018 (except as otherwise indicated below) regarding the beneficial ownership of our common stock by each director of the Company, each named executive officer listed in the Summary Compensation Table in this proxy statement, and by all of our directors and executive officers as a group. Except as otherwise noted, each person is the record owner of and has sole voting and investment power with respect to the shares of common stock shown as beneficially owned by them. The percentage of beneficial ownership is calculated based on 2,537,605 shares of common stock outstanding as of March 16, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
|
|
Percent Of
|
|
Name of Beneficial Owner
|
|
Shares Owned
|
|
Class
|
|
Kent Furlong
|
|
3,250
|
|
*
|
|
Sarah Glenn Grise (1)
|
|
6,506
|
|
*
|
|
Jim Henderson
|
|
290
|
|
*
|
|
James R. Hilliard
|
|
30,706
|
|
1.2%
|
|
Mark Iverson
|
|
5,051
|
|
*
|
|
M. Todd Kanipe (2)
|
|
30,016
|
|
1.2%
|
|
Marc R. Lively (3)
|
|
6,168
|
|
*
|
|
Steve Marcum
|
|
19,526
|
|
*
|
|
Amy Milliken (4)
|
|
14,373
|
|
*
|
|
Jeff Perkins (5)
|
|
5,000
|
|
*
|
|
Jack Sheidler
|
|
75,283
|
|
3.0%
|
|
John Taylor
|
|
2,890
|
|
*
|
|
Kevin Vance (6)
|
|
12,948
|
|
*
|
|
Current directors and executive officers as a group (14 persons)
|
|
222,382
|
|
8.8%
|
|
*
Less than 1.0%.
|
(1)
|
|
Includes 1,357 shares held jointly with Ms. Grise’s husband.
|
|
(2)
|
|
Includes 2,000 shares held in an individual retirement account for the benefit of Mr. Kanipe’s wife, and 4,300 shares held jointly with Mr. Kanipe’s wife.
|
|
(3)
|
|
Includes 2,668 shares held jointly with Mr. Lively’s wife.
|
|
(4)
|
|
Includes 56 shares held jointly with Ms. Milliken’s husband, 530 shares held by Ms. Milliken’s husband and 4,405 shares held by Ms. Milliken’s children.
|
|
(5)
|
|
Includes 2,725 shares held in an individual retirement account for the benefit of Mr. Perkin’s wife.
|
|
(6)
|
|
Includes 6,825 shares held jointly with Dr. Vance’s wife; such shares are pledged as security for a loan.
|
The following table sets forth information as of March 16, 2018 (except as otherwise indicated below) regarding the beneficial ownership of our common stock by the only persons known by the Company to beneficially own five percent (5%) or more of the common stock. The percentage of beneficial ownership is calculated based on 2,537,605 shares of common stock outstanding as of March 16, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
|
|
|
|
|
|
|
|
Shares
|
|
|
|
Percent of
|
|
Name and Address of Beneficial Owner
|
|
Owned
|
|
Total
|
|
Class
|
|
PRB Advisors, L.L.C. (1)
|
|
191,075
|
|
191,075
|
|
7.6
|
%
|
245 Park Avenue, 24
th
Floor
|
|
|
|
|
|
|
|
New York, New York 10167
|
|
|
|
|
|
|
|
Siena Capital Partners I, L.P.(2)
|
|
170,677
|
|
170,677
|
|
6.8
|
%
|
100 N. Riverside Plaza
|
|
|
|
|
|
|
|
Chicago, Illinois 60606
|
|
|
|
|
|
|
|
Tontine Financial Partners, LP(3)
|
|
140,711
|
|
140,711
|
|
5.6
|
%
|
1 Sound Shore Drive, Suite 304
|
|
|
|
|
|
|
|
Greenwich, Connecticut 06380‑7521
|
|
|
|
|
|
|
|
|
(1)
|
|
Based on information set forth in a Schedule 13G/A filed February 14, 2018 by PRB Advisors, LLC with the SEC on its own behalf and on behalf of its affiliates, PRB Investors, L.P., Andrew P. Bergman and Stephen J. Paluszek (collectively, “PRB”). According to the filing, PRB has shared voting and dispositive power with respect to 179,209 shares and Stephen J. Paluszek has sole voting and dispositive power with respect to an additional 11,866 shares.
|
|
(2)
|
|
Based on information set forth in a Schedule 13G filed December 8, 2015 by Siena Capital Partners I, LP with the SEC on its own behalf and on behalf of its affiliates, Siena Capital Partners Accredited, L.P. and Siena Capital Management (collectively, “Siena”). According to the filing, Siena has shared voting and dispositive power with respect to the shares.
|
|
(3)
|
|
Based on information set forth in a Schedule 13G/A filed February 9, 2018 by Tontine Management, LLC with the SEC on its own behalf and on behalf of its affiliates Tontine Financial Partners, LP and Jeffrey L. Gendell (collectively, “Tontine”). According to the filing, Tontine has shared voting and dispositive power with respect to the shares.
|
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers and persons who beneficially own more than 10% of our common stock to file reports of holdings and transactions in our common stock with the Securities and Exchange Commission. Based on our information, we believe that all Section 16(a) Securities and Exchange Commission filing requirements applicable to our directors, executive officers and other beneficial owners for 2017 were timely met, except for one Form 4 filing by Sarah Grise that was filed late as a result of a delay in obtaining necessary filing codes.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We have had and expect in the future to have banking transactions in the ordinary course of business with our directors and executive officers and their associates, including members of their families, corporations, partnerships or other organizations in which the directors and officers have a controlling interest. All loan and other transactions were on substantially the same terms (including price, interest rate and collateral) as those prevailing at the same time for comparable transactions with unrelated parties and did not involve more than the normal risk of collectability nor present other unfavorable features to us. Loans to individual directors and officers must also comply with our lending policies and statutory lending limits, and directors with a personal interest in any loan application are excluded from the consideration of the loan application. Our policy is that all of our transactions with our affiliates will be on terms no less favorable to us than could be obtained from an unaffiliated third party and will be approved by a majority of disinterested directors. None
of such loans were disclosed as nonaccrual, past due, restructured or potential problems in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2017.
AUDIT COMMITTEE REPORT
The following is the Report of the Audit Committee regarding the Company’s audited financial statements to be included in the Company’s Annual Report on Form 10‑K.
The Audit Committee has reviewed and discussed with our management the Company’s audited financial statements as of December 31, 2017 and 2016 and for each of the years in the two-year period ended December 31, 2017. The Audit Committee also reviewed and discussed with Crowe Horwath LLP, the Company’s independent registered public accounting firm, all communications required by standards of the PCAOB, including the matter required to be discussed by Auditing Standard No. 16, Communications with Audit Committee, as adopted by the Public Company Accounting Oversight Board in Rule 3200T. The Audit Committee has received the written disclosures and the letter from Crowe Horwath LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the audit committee concerning independence, and has discussed with Crowe Horwath LLP their independence.
Based upon such review and discussions, the Audit Committee has recommended to the Board of Directors that, and the Board of Directors has approved, the audited financial statements be included in our Annual Report on Form 10‑K for the year ended December 31, 2017 for filing with the Securities and Exchange Commission.
|
|
|
|
Members of the Audit Committee:
|
|
|
|
|
|
Sarah Glenn Grise, Chairman
|
|
|
Jim Henderson
|
|
|
Mark Iverson
Jeff Perkins
|
|
|
Jack Sheidler
|
|
|
John Taylor
|
|
|
Kevin Vance
|
The foregoing report of the Audit Committee shall not be deemed incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933 or the Securities Act of 1934, except to the extent the Company specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board of Directors has approved the appointment of Crowe Horwath LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018. Crowe Horwath is a full-service firm of certified public accountants and has served as the Company’s auditors since 2005. Services provided to the Company are described below under “Audit Fees.” A representative of Crowe Horwath is expected to be present at the Meeting and will be given the opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions from shareholders.
Audit Fees.
During the years ended December 31, 2017 and 2016, the Company incurred the following fees for services performed by the independent registered public accounting firm:
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
Audit Fees (1)
|
|
$
|
102,500
|
|
$
|
99,000
|
Audit-Related Fees (2)
|
|
|
18,231
|
|
|
23,584
|
Tax Fees (3)
|
|
|
11,850
|
|
|
16,410
|
All Other Fees
|
|
|
—
|
|
|
—
|
Total Fees
|
|
$
|
132,581
|
|
$
|
138,994
|
|
(1)
|
|
Includes fees related to the annual independent audit of the Company’s financial statements and reviews of the Company’s annual and quarterly reports.
|
|
(2)
|
|
Includes services for consultation on various accounting matters and audit of the Company’s 401(k) plan.
|
|
(3)
|
|
Includes fees for tax return preparation, tax consulting and quarterly estimated income tax calculations.
|
The Audit Committee has adopted a formal policy concerning approval of audit and non-audit services to be provided by the independent auditor to the Company. The policy requires that all services that the Company’s independent auditor may provide to the Company, including audit services and permitted audit-related and non-audit services, be pre-approved by the Committee. The Committee approved all audit and non-audit services provided by Crowe Horwath during fiscal years 2017 and 2016 prior to Crowe Horwath performing such services.
ANNUAL REPORT
We will provide without charge to any shareholder, upon written request, a copy of our Annual Report on Form 10‑K for the fiscal year ended December 31, 2017, which includes financial statements, which is required to be filed with the Securities and Exchange Commission.
Written requests should be directed to Kim Kleis, Citizens First Corporation, at 1065 Ashley Street, Suite 150, Bowling Green, Kentucky 42103, or at telephone number (270) 393‑0700.
OTHER MATTERS
As of the date of this proxy statement, the Board of Directors does not know of any other matters that may be brought before the Meeting, other than the items referred to in this proxy statement. If, however, any such other matters are presented, the persons named in the accompanying proxy card or their substitutes will vote such proxy according to their best judgment on such matters.
Please vote by telephone or over the Internet, or fill in, sign and date the proxy card and return it in the accompanying prepaid envelope. If you attend the Meeting and wish to vote your shares in person, you may do so. Your cooperation in giving this matter your prompt attention is appreciated.
Appendix I
CITIZENS FIRST CORPORATION
AUDIT COMMITTEE CHARTER
1.
PURPOSE
The primary functions of the Audit Committee are to assist the Board of Directors in fulfilling its oversight responsibilities with respect to: (i) the Company's systems of internal controls regarding finance, accounting, and ethical behavior; (ii) the Company's auditing, accounting and financial reporting processes generally; (iii) the integrity of the Company's financial statements and other financial information provided by the Company to its shareholders, the public and others; (iv) compliance with legal and regulatory requirements; and (v) the performance of the Company's independent auditors. Consistent with these functions, the Committee will encourage continuous improvement of, and foster adherence to, the Company's policies, procedures and practices at all levels.
Although the Committee has the powers and responsibilities set forth in this Charter, the role of the Committee is oversight. The members of the Committee are not full-time employees of the Company and may or may not be accountants or auditors by profession or experts in the fields of accounting or auditing and, in any event, do not serve in such capacity. Consequently, it is not the duty of the Committee to conduct audits or to determine that the Company's financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles and applicable rules and regulations. These are the responsibilities of management and the independent auditors.
2.
ORGANIZATION
The Audit Committee shall be comprised of three or more directors as determined by the Board of Directors, each of whom shall satisfy the applicable independence, financial literacy and experience requirements of Section 10A of the Securities Exchange Act of 1934 and any other regulatory requirements. The Board will determine whether at least one member of the Audit Committee qualifies as an “audit committee financial expert” in compliance with the criteria established by the SEC. The existence of such a member, including his or her name and whether or not he or she is independent, will be disclosed in periodic filings as required by the SEC.
Committee members shall be elected by the Board annually. Members shall serve until their successors shall be duly elected. The Committee's chairperson shall be designated by the full Board or, if it does not do so, the Committee members shall elect a chairperson by vote of a majority of the full Committee. The Committee may form and delegate authority to subcommittees when appropriate.
3.
MEETINGS
The Audit Committee shall meet four times per year on a quarterly basis, or more frequently as circumstances require. The Committee shall require members of management, the independent auditors and others to attend meetings and to provide pertinent information, as necessary. As part of its responsibility to foster open communications, the Committee shall be given the opportunity to meet in separate executive sessions during each of its four regularly scheduled meetings with management and the Company's independent auditors to discuss any matters that the Committee (or any of these groups) believes should be discussed privately.
4.
RESPONSIBILITIES AND DUTIES
In recognition of the fact that the Company's independent auditors are ultimately accountable to the Audit Committee, the Committee shall have the sole authority and responsibility to select, evaluate, and, where appropriate, replace the independent auditors or nominate the independent auditors for shareholder approval. The Committee shall approve all audit engagement fees and terms and all non-audit engagements with the independent auditors. The Committee shall consult with management but shall not delegate these responsibilities.
To fulfill its responsibilities and duties, the Audit Committee shall:
A.
With respect to the independent auditors:
[1] Be directly responsible for the appointment, compensation and oversight of the work of the independent auditors (including resolution of disagreements between management and the independent auditors regarding financial reporting) for the purpose of preparing its audit report or related work.
[2] Have the sole authority to review in advance, and grant any appropriate pre-approvals of, (i) all auditing services to be provided by the independent auditors and (ii) all non-audit services to be provided by the independent auditors as permitted by Section 10A of the Securities Exchange Act of 1934, and in connection therewith, to approve all fees and other terms of engagement. The Committee shall also review and approve disclosures required to be included in Securities and Exchange Commission periodic reports filed under Section 13(a) of the Securities Exchange Act of 1934 with respect to non-audit services.
[3] Review the performance of the Company's independent auditors on at least an annual basis and remove the independent auditor if circumstances warrant.
[4] On an annual basis, review and discuss with the independent auditors all relationships the independent auditors have with the Company in order to evaluate the independent auditors' continued independence. The Committee: (i) shall ensure that the independent auditors submit to the Committee on an annual basis a written statement (consistent with applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the audit committee concerning independence) delineating all relationships and services that may impact the objectivity and independence of the independent auditors; (ii) shall discuss with the independent auditors any disclosed relationship or services that may impact the objectivity and independence of the independent auditors; and (iii) shall satisfy itself as to the independent auditors' independence.
[5] At least annually, obtain and review an annual report from the independent auditors describing (i) the independent auditors' internal quality control procedures and (ii) any material issues raised by the most recent internal quality control review, or peer review, of the independent auditors, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the independent auditors, and any steps taken to deal with any such issues.
[6] Review the independent auditor’s attestation, to the extent an ICFR attestation report is required by the auditor, and report on management’s internal control report, from the time that such reports are prepared and hold timely discussions with the independent auditor regarding the following:
|
·
All critical accounting policies and practices;
|
|
·
All alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments and the treatment preferred by the independent auditor; and
|
|
·
Other material written communications between the independent auditor and management, including, but not limited to, the management letter and schedule of unadjusted differences.
|
[7] Review all reports required to be submitted by the independent auditors to the Committee under Section 10A of the Securities Exchange Act of 1934.
[8] Review, based upon the recommendation of the independent auditors, the scope and plan of the work to be done by the independent auditors for each fiscal year.
B.
With respect to the financial statements:
[1] Review and discuss with management and the independent auditors the Company's quarterly financial statements (including disclosures made in "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the independent auditors' review of the quarterly financial statements) prior to submission to shareholders, any governmental body, any stock exchange or the public.
[2] Review and discuss with management and the independent auditors the Company's annual audited financial statements (including disclosures made in "Management's Discussion and Analysis of Financial Condition and Results of Operations").
[3] Discuss with the independent auditors the matters required to be discussed by Auditing Standard No. 16, relating to the conduct of the audit.
[4] Recommend to the Board of Directors, if appropriate, that the Company's annual audited financial statements be included in the Company's annual report on Form 10-K for filing with the Securities and Exchange Commission.
[5] Prepare the report required by the Securities and Exchange Commission to be included in the Company's annual proxy statement and any other Committee reports required by applicable securities laws or stock exchange listing requirements or rules.
C.
Periodic and Annual Reviews:
[1] Periodically review separately with each of management and the independent auditors (i) any significant disagreement between management and the independent auditors in connection with the preparation of the financial statements, (ii) any difficulties encountered during the course of the audit (including any restrictions on the scope of work or access to required information), and (iii) management's response to each.
[2] Periodically discuss with the independent auditors, without management being present, (i) their judgments about the quality, appropriateness, and acceptability of the Company's accounting principles and financial disclosure practices, as applied in its financial reporting, and (ii) the completeness and accuracy of the Company's financial statements.
[3] Consider and approve, if appropriate, significant changes to the Company's accounting principles and financial disclosure practices as suggested by the independent auditors or management and review with the independent auditors and management, at appropriate intervals, the extent to which any changes or improvements in accounting or financial practices, as approved by the Committee, have been implemented.
[4] Review with management, the independent auditors, and the Company's counsel, as appropriate, any legal, regulatory or compliance matters that could have a significant impact on the Company's financial statements, including significant changes in accounting standards or rules as promulgated by the Financial Accounting Standards Board, the Securities and Exchange Commission or other regulatory authorities with relevant jurisdiction.
[5] Obtain and review an annual report from management relating to the accounting principles used in preparation of the Company's financial statements (including those policies for which management is required to exercise discretion or judgments regarding the implementation thereof).
D.
Discussions With Management:
[1] Unless reviewed by the full Board, review and discuss with management the Company's earnings press releases (including the use of "pro forma" or "adjusted" non-GAAP information) as well as financial information and earnings guidance provided to analysts and rating agencies.
[2] Review and discuss with management all material off-balance sheet transactions, arrangements, obligations (including contingent obligations) and other relationships of the Company with unconsolidated entities or other persons, that may have a material current of future effect on financial condition, changes in financial condition, results of operations, liquidity, capital resources, capital reserves or significant components of revenues or expenses.
[3] Inquire about the application of the Company's accounting policies and its consistency from period to period, and the compatibility of these accounting policies with generally accepted accounting principles, and (where appropriate) the Company's provisions for future occurrences that may have a material impact on the financial statements of the Company.
[4] Review and discuss with management all disclosures made by the Company concerning any material changes in the financial condition or operations of the Company.
[5] Obtain explanations from management for unusual variances in the Company's annual financial statements from year to year, and review annually the independent auditors' letter of the recommendations to management and management's response.
E.
With respect to internal controls:
[1] In consultation with the independent auditors, review the integrity of the Company’s financial reporting process (both internal and external) and the adequacy of the Company's internal control structure and system, and the procedures designed to ensure compliance with laws and regulations.
[2] Establish procedures for (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and (ii) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters.
[3] Receive and review any disclosure from the Company’s CEO or CFO made in connection with the certification of the Company’s quarterly and annual reports filed with the SEC of : (a) all significant deficiencies and material weaknesses in the design and operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize, and report financial date; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls.
F.
Other:
[1] Review and approve all related-party transactions that have not been previously renewed by the Board of Directors.
[2] Unless performed by the full Board, establish, review and update periodically a code of business conduct and ethics and determine whether management has established a system to enforce this code. Review and approve (i) any change or waiver in the Company's code of business conduct and ethics for directors or executive officers, and (ii) any disclosure made on Form 8-K regarding such change or waiver.
[3] Establish the policy for the Company's hiring of employees or former employees of the independent auditors who were engaged on the Company's account.
[4] Review any management decision to seek a second opinion from independent auditors other than the Company's regular independent auditors with respect to any significant accounting issue.
[5] Review with management and the independent auditors the sufficiency and quality of the financial and accounting personnel of the Company.
[6] Review and discuss updates from the Risk Management Committee.
[7] Review and reassess the adequacy of this Charter annually and recommend to the Board any changes the Committee deems appropriate.
[8] Perform any other activities consistent with this Charter, the Company's Bylaws and governing law as the Committee or the Board deems necessary or appropriate.
5.
RESOURCES.
The Audit Committee shall have the authority to retain independent legal, accounting and other consultants to advise the Committee as deemed appropriate to perform its duties and responsibilities. The Committee may request any officer or employee of the Company or the Company's outside counsel or independent auditors to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee. The Committee shall determine the extent of funding necessary for payment of compensation to the independent auditors for purpose of rendering or issuing the annual audit report and to any independent legal, accounting and other consultants retained to advise the Committee.
Appendix II
CITIZENS FIRST CORPORATION
COMPENSATION COMMITTEE CHARTER
1. PURPOSE
The purpose of the Compensation Committee is to carry out the Board of Directors’ overall responsibility relating to executive compensation and executive succession planning, and oversight of key risk areas associated with compensation, benefits and human resource planning. The Compensation Committee shall ensure the Company’s compensation policies and practices are in furtherance with the need to recruit, develop, and retain the highest caliber talent in order to achieve the Company’s business plans and optimize long-term financial returns.
2. COMPOSITION
The Compensation Committee shall be comprised of not less than three (3) members of the Board of Directors, each of whom shall be independent as defined by the listing standards of The Nasdaq Stock Market, and one of whom shall be its Chairperson. All Committee members shall also be “non-employee directors” as defined by Rule 16b-3 under the Securities Exchange Act of 1934 and “outside directors” as defined by Section 162(m) of the Internal Revenue Code. The Chief Executive Officer (CEO) shall serve as an
ex officio
member of the Committee. The Committee and its Chairperson shall be appointed annually by a majority of the Board of Directors and may be removed by the Board in its discretion. The Committee shall have the authority to delegate any of its responsibilities to subcommittees as the Committee may deem appropriate, provided the subcommittees are composed entirely of independent directors.
3. MEETINGS
The Compensation Committee shall meet at least twice annually, at times and places decided by the Committee Chairperson.
4. RESPONSIBILITIES AND DUTIES
The Compensation Committee shall have the following authority and responsibilities:
A. Annually review and approve an executive compensation strategy to ensure that the CEO and other principal officers are compensated in a manner consistent with the Company’s philosophy that compensation should be commensurate with performance, together with the objectives of the Company, competitive practices, internal equity considerations, and the requirements of appropriate regulatory bodies.
B. Ensure that equity-related long-term incentive plans for management are designed and administered in a manner consistent with the Company’s commitment to building long-term shareholder value and compensation strategy. The Compensation Committee shall recommend to the full Board any plan changes including performance goals, vesting requirements, awards and dilution considerations. The Compensation Committee shall also have the authority to administer the Company’s incentive compensation plans and equity-based plans, including designation of the employees to whom the awards are to be granted, the amount of the award or equity to be granted and the terms and conditions applicable to each award, or grant, subject to the provisions of each plan. In reviewing and making recommendations regarding incentive compensation plans and equity based plans, including whether to adopt, amend or terminate any such plans, the Committee shall consider the results of the most recent stockholder advisory vote on executive compensation (“Say on Pay Vote”) required by Section 14A of the Exchange Act.
C. Together with the full Board, annually review and establish the corporate goals and objectives for the CEO, and annually review the CEO’s performance in light of those established goals and objectives. Based on this review, the Compensation Committee shall have the sole authority to determine the CEO’s compensation, including salary and annual incentive bonus and long-term equity compensation, if any. In determining any long-term incentive component of CEO compensation, the Committee may consider the Company’s performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, and the awards given to the Company’s CEO in past years. In evaluating and determining CEO compensation, the Compensation Committee shall consider the results of the most recent Say on Pay Vote. The CEO cannot be present during any voting or deliberations by the Committee on his or her compensation.
D. Together with the CEO and the full Board, annually review and establish the corporate goals and objectives for the Company’s non-CEO executive management. With the CEO, annually review the performance of the members of the Company’s non-CEO executive management based on those established goals and objectives, and, upon recommendation of the CEO regarding the performance of the non-CEO executive management, review and approve the compensation for those executives. In evaluating and determining executive compensation, the Committee shall consider the results of the most recent Say on Pay Vote.
E. To review the Company’s incentive compensation arrangements to determine whether they encourage excessive risk-taking, to review and discuss at least annually the relationship between risk management policies and practices and compensation, and to evaluate compensation policies and practices that could mitigate any such risk.
F. To review and recommend to the Board for approval the frequency with which the Company will conduct Say on Pay Votes, taking into account the results of the most recent stockholder advisory vote on frequency of Say on Pay Votes required by Section 14A of the Exchange Act, and review and approve the proposals regarding the Say on Pay Vote and the frequency of the Say on Pay Vote to be included in the Company's proxy statement.
G. Discuss, evaluate and review at least every six months the terms of all employee compensation plans and identify and eliminate features that encourage manipulation of reported earnings to enhance the compensation of the employee.
H. Advise the CEO in matters relating to executive management succession; and oversee executive development initiatives.
I. If required, prepare a report each year concerning its performance of duties authorized by this Charter for inclusion in the Company’s proxy statement.
J. Conduct evaluations of the Committee’s performance in fulfilling its duties and responsibilities under this Charter.
K. Review and reassess this Charter annually and recommend any proposed changes to the Board for approval.
L. The Compensation Committee shall have the authority, in its sole discretion, to select, retain and obtain the advice of a compensation consultant as necessary to assist with the execution of its duties and responsibilities as set forth in this Charter. The Committee shall set the compensation, and oversee the work, of the compensation consultant. The Committee shall have the authority, in its sole discretion, to retain and obtain the advice and assistance of outside legal counsel and such other advisors as it deems necessary to fulfill its duties and responsibilities under this Charter. The Committee shall set the compensation, and oversee the work, of its outside legal counsel and other advisors. The Committee shall receive appropriate funding from the Company, as determined by the Committee in its capacity as a committee of the Board, for the payment of compensation to its compensation consultants, outside legal counsel and any other advisors. However, the Committee shall not be required to implement or act consistently with the advice or recommendations of its compensation consultant, legal counsel or other advisor to the compensation committee, and the authority granted in this Charter shall not affect the ability or obligation of the Committee to exercise its own judgment in fulfillment of its duties under this Charter.
The compensation consultant(s), outside counsel and any other advisors retained by, or providing advice to, the Committee shall be independent as determined in the discretion of the Committee after considering the factors specified in Rule 10C-1 of the Exchange Act. The Committee is not required to assess the independence of any compensation consultant or other advisor that acts in a role limited to consulting on any broad-based plan that does not discriminate in scope, terms or operation in favor of executive officers or directors and that is generally available to all salaried employees or providing information that is not customized for a particular company or that is customized based on parameters that are not developed by the consultant or advisor, and about which the consultant or advisor does not provide advice. The Committee shall evaluate whether any compensation consultant retained or to be retained by it has any conflict of interest in accordance with Item 407(e)(3)(iv) of Regulation S-K.
APPENDIX III
Article VI
All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation managed under the direction of, its board of directors. The number of directors shall be fixed by resolution of the board of directors from time to time, subject to the applicable provisions of the Act and the corporation’s bylaws, and shall be at least seven (7) and not more than eighteen (18).
The directors shall be divided into three classes with each class being as nearly equal in number as possible. The term of office of the first class of directors shall be one (1) year and shall expire at the first annual meeting of the shareholders of the corporation (or until their successors are elected and qualified) after their election; the term of the second class of directors shall be two (2) years and shall expire at the second annual meeting of the shareholders of the corporation (or until their successors are elected and qualified) after their election; and the term of the third class of directors shall be three (3) years and shall expire at the third annual meeting of the shareholders of the corporation (or until their successors are elected and qualified) after their election.
Beginning with the first annual meeting of shareholders of the corporation after the election of directors to the three classes described above, the term of office for each class of directors elected or re-elected to the board of directors shall be three (3) years and shall expire at the third succeeding annual meeting following their election or re-election (or until their successors are elected and qualified).
Commencing with
the 2019 annual meeting of shareholders of the corporation, directors shall be elected for a term expiring at the next annual meeting of shareholders of the corporation and each director shall hold office until his or her successor is elected and qualified; provided, that any director elected for a longer term before the 2019 annual meeting of shareholders of the corporation shall hold office for the entire term for which he or she was originally elected.
|
ANNUAL MEETING OF SHAREHOLDERS OF CITIZENS FIRST CORPORATION May 16, 2018 INTERNET - Access “www.voteproxy.com” and follow the on-screen instructions or scan the QR code with your smartphone. Have your proxy card available when you access the web page. TELEPHONE - Call toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from foreign countries from any touch-tone telephone and follow the instructions. Have your proxy card available when you call. Vote online/phone until 11:59 PM EST the day before the meeting. MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible. IN PERSON - You may vote your shares in person by attending the Annual Meeting. Please detach along perforated line and mail in the envelope provided IF you are not voting via telephone or the Internet. 20330303000000000000 7 051618 December 31, 2018. (The Board recommends a vote FOR this Company’s named executive officers as described in the proxy their discretion, the proxies are authorized to vote on other matters as may properly changes to the registered name(s) on the account may not be submitted via Note: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee, guardian or other fiduciary, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE NOMINEES FOR DIRECTOR LISTED IN ITEM 1, AND “FOR” PROPOSALS 2, 3 AND 4. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE x 1. Election of Directors: NOMINEES: FOR ALL NOMINEESO James R. Hilliard O M. Todd Kanipe WITHHOLD AUTHORITYO Kevin Vance FOR ALL NOMINEES FOR ALL EXCEPT (See instructions below) INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark “FOR ALL EXCEPT” and fill in the circle next to each nominee you wish to withhold, as shown here: FOR AGAINST ABSTAIN 2. To ratify the appointment of Crowe Horwath LLP as the Company’s independent registered public accounting firm for the fiscal year ending proposal). 3. To approve, on a non-binding, advisory basis, the compensation of the statement. (The Board recommends a vote FOR this proposal). 4. To approve an amendment to Article VI of the Corporation’s Second Amended and Restated Articles of Incorporation providing for the phased-in declassification of the Board of Directors. (The Board recommends a vote FOR this proposal). When properly executed, this proxy will be voted in the manner specified above by the shareholder. To the extent contrary specifications are not given, this proxy will be voted for the nominees listed in Item 1, and for approval of proposals 2, 3 and 4. In come before the annual meeting. To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that this method. Signature of Shareholder Date: Signature of ShareholderDate: IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIAL FOR THE ANNUAL MEETING: The notice of annual meeting, proxy statement and annual report are available at http://www.astproxyportal.com/ast/19059/ COMPANY NUMBER ACCOUNT NUMBER PROXY VOTING INSTRUCTIONS
|
Citizens First Corp. (MM) (NASDAQ:CZFC)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Citizens First Corp. (MM) (NASDAQ:CZFC)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024