DEF 14A of HBT Financial, Inc.
Filed Apr 8, 2026 · FY20250000775215-26-000037
PROPOSAL 1—ELECTION OF DIRECTORS
PROPOSAL 1—ELECTION OF DIRECTORS Our bylaws provide that the number of directors will be fixed from time to time by resolution of the Board. The Board currently consists of 12 directors: James T. Ashworth, Roger A. Baker, C. Alvin Bowman, Eric E. Burwell, Patrick F. Busch, J. Lance Carter, Allen C. Drake, Fred L. Drake, Linda J. Koch, Michael J. Morton, Gerald E. Pfeiffer, and Nancy L. Ruyle. The Company’s Corporate Governance Guidelines provide that no person will be nominated for election to the Board if he or she will attain the age of 75 before such election. This policy is intended to promote a governance structure that balances experience with new perspectives. However, the Board is authorized, in its discretion, to grant waivers to the mandatory retirement age based on a nominee’s particular circumstances. On March 24, 2026, on the recommendation of the Nominating and Corporate Governance Committee, the Board granted an exception to the policy to allow Mr. Pfeiffer to stand for re-election at the 2026 Annual Meeting. This determination reflects Mr. Pfeiffer’s position as a key Board member, including his service as Chair of the Audit Committee and as the "audit committee financial expert," as such term is defined in the rules of the SEC. Accordingly, the Board determined it was in the best interests of stockholders that Mr. Pfeiffer be allowed to continue service on the Board. The Board consists of one class of directors serving one-year terms or until their successors are duly elected and qualified. We are soliciting proxies in favor of the election of each of the nominees identified below. The shares represented by proxies will be voted in favor of the election of each of the nominees whose names are set forth below unless such proxy is specifically marked to "withhold" authority to vote for a particular nominee. All nominees have consented to serve as directors, if elected. If any nominee is unwilling to serve as a director at the time of the Annual Meeting, the persons who are designated as proxies intend to vote, in their discretion, for such other persons, if any, as may be designated by the Board. As of the date of this Proxy Statement, the Board has no reason to believe that any of the persons named below will be unable or unwilling to stand as a nominee or serve as a director, if elected. The Board believes that each nominee has valuable individual skills and experiences that, taken together, provide us with the knowledge, judgment and strategic vision necessary to provide effective oversight of HBT Financial. The biographies below reflect the particular experience, qualifications, attributes and skills that led the Board to conclude that each nominee should serve on the Board. Fred L. Drake, our Executive Chairman, and Director Allen C. Drake are brothers, and there are no other related persons on the Board.
Director Nominees
Director Nominees The names of the nominees are as follows:
James T. Ashworth
James T. Ashworth
Age: 74
Age: 74 James T. Ashworth has been a director of the Company and Heartland Bank since March 1, 2026. Mr. Ashworth previously served as the President and Vice Chairman of CNB Bank Shares, Inc. ("CNB") and Vice Chairman of CNB Bank & Trust, N.A. ("CNB Bank"), which were acquired by HBT Financial on March 1, 2026. He also served on the Board of Directors of CNB and CNB Bank. In addition to CNB and CNB Bank, Mr. Ashworth previously served on the Board of Directors of the Community Bankers Association of Illinois and the Federal Home Loan Bank of Chicago. Mr. Ashworth graduated from the University of Miami (Florida) and completed the Graduate School of Banking at the University of Wisconsin-Madison. Mr. Ashworth was selected to serve as a director for his experience in the banking industries and his familiarity with our I-72 and South-Central markets.
Roger A. Baker
Roger A. Baker Roger A. Baker has been a director of the Company and Heartland Bank since 2022. Mr. Baker previously served as the Chairman and President of NXT Bancorporation, Inc. and Chairman of NXT Bank, which were acquired by HBT Financial on October 1, 2021. In addition to NXT Bank, Mr. Baker previously served on the Board of Directors of two other Iowa-based banks, Lincoln Savings Bank and Liberty Bank. Mr. Baker has owned several businesses over the years, and is actively engaged in the business community throughout our Iowa markets. Mr. Baker graduated from Iowa State University with a BS in Agricultural Economics. Mr. Baker was selected to serve as a director for his experience in the banking and agricultural industries and his familiarity with our Iowa markets.
C. Alvin Bowman
C. Alvin Bowman C. Alvin Bowman has been a director of the Company and Heartland Bank since 2019. Dr. Bowman served as the 17th President of Illinois State University for ten years before retiring in 2013. Prior to his term as President, he served in various capacities, including Department Chair of its Speech Pathology and Audiology Department and as Interim Provost. Additionally, he was the Executive Director of the Illinois Board of Higher Education from November 2017 to December 2018. Dr. Bowman received a BA in Speech Pathology from Augustana College, a Master’s in Speech-Language Pathology from Eastern Illinois University and a PhD in Speech and Hearing Science from the University of Illinois. He has 36 years of experience in higher education. Mr. Bowman was selected to serve as a director for his leadership, communication and organizational skills gained over the course of his career.
Eric E. Burwell
Eric E. Burwell
Age: 58
Age: 58 Eric E. Burwell has been a director of the Company since 2009 and a director of Heartland Bank since 2005. Mr. Burwell is a Principal of Burwell Management Company, a family-owned property management company, investing in a variety of real estate, private equity, venture capital and liquid investments. Mr. Burwell received a BS in Business Administration and a BS in Finance, both from Illinois State University and holds an MBA from Loyola University of Chicago. Mr. Burwell is also an Illinois licensed real estate managing broker. Mr. Burwell was selected to serve as a director for his knowledge of the real estate industry and his investment and business experience.
Patrick F. Busch
Patrick F. Busch
Age: 69
Age: 69 Patrick F. Busch has been a director of the Company since 1998 and a director of Heartland Bank since 1995. Mr. Busch is Vice Chairman of Heartland Bank. He joined us in 1995 and was President and Chief Lending Officer of Heartland Bank from March 2010 until December 2022 and Executive Vice President of the Company from December 2009 to December 2022. As Chief Lending Officer, Mr. Busch was critical in establishing the loan culture and integrating acquisitions over the years. He played a leading role in Heartland Bank’s organic growth in Bloomington-Normal, Champaign and Peoria. Mr. Busch received a BS in Business Administration from Illinois Wesleyan University and completed the Stonier Graduate School of Banking. Mr. Busch was selected to serve as a director because of the depth of his understanding of the banking industry and his experience establishing our loan culture and integrating acquisitions during his tenure with us.
J. Lance Carter
J. Lance Carter J. Lance Carter has been a director of the Company and Heartland Bank since 2011. Mr. Carter is President and Chief Executive Officer of the Company and Heartland Bank. Mr. Carter joined us in 2001 and served as Heartland Bank's Chief Credit Officer from March 2010 to December 2018. He was named Executive Vice President of the Company in December 2011 and Chief Operating Officer in June 2015. Mr. Carter was named President of the Company in August 2019, and President of Heartland Bank in January 2023. In May 2023, Mr. Carter was named Chief Executive Officer of the Company and Heartland Bank, and no longer serves as Chief Operating Officer of the Company and Heartland Bank. Mr. Carter’s responsibilities include oversight of day-to-day operations of all areas of Heartland Bank. Mr. Carter holds a BS in Finance and an MBA from the University of Illinois. He has also completed the Graduate School of Banking at the University of Wisconsin-Madison. Mr. Carter was selected to serve as a director for his experience in the banking industry and knowledge of the Company gained during his tenure with us.
Allen C. Drake
Allen C. Drake Allen C. Drake has been a director of the Company and Heartland Bank since 1981. He became an officer of Heartland Bank in 1979 and served for 28 years, until retiring as Chairman and Chief Financial Officer in 2007. During his tenure as an executive officer with us, he was President of one of our predecessor banks and served on the boards of several of our predecessor banks. He was involved in merger and acquisition activities, technology innovation, trust, finance and systems integrations. Mr. Drake received a BS and MS in Electrical Engineering from the University of Illinois. Mr. Drake was selected to serve as a director for his knowledge of Heartland Bank gained during his tenure with the Bank, including his experience with lending, administration, technology, personnel, finance, trust and strategic planning.
Fred L. Drake
Fred L. Drake
Age: 69
Age: 69 Fred L. Drake serves as Executive Chairman of the board for both the Company and of Heartland Bank. He has served as Chairman since 2006 and been a director of the Company since 1984 and a director of Heartland Bank since 1982. Mr. Drake is Executive Chairman of the Company and Heartland Bank and provides leadership in all facets, including overall strategy, growth, and acquisitions. Mr. Drake became an officer of Heartland Bank in 1983 and served as the Company's Chief Executive Officer until May 2023. He also served as our President from 1998 to August 2019. In 1992, as President of Heartland Bank, he led our entry into the Bloomington-Normal market, one of the Bank’s most successful initiatives, setting the tone for the Company’s organic growth in the 1990s and early 2000s. Mr. Drake received a BS in Finance and an MBA, both from the University of Illinois. Mr. Drake serves as a director for his leadership in all facets of our company, including overall strategy, organic growth and acquisitions, overall experience in the banking industry and his knowledge of the Company gained during his tenure with us.
Linda J. Koch
Linda J. Koch
Age: 64
Age: 64 Linda J. Koch has been a director of the Company and Heartland Bank since 2020. Ms. Koch served as the President and Chief Executive Officer of the Illinois Bankers Association from 2001 to 2020. As President and Chief Executive Officer, Ms. Koch was responsible for the leadership, strategy, and operational management of the Illinois Bankers Association. During that same time, Ms. Koch served on the Board of Trustees of the Graduate School of Banking at the University of Wisconsin-Madison. Ms. Koch received a BA in Legal Studies from the University of Illinois Springfield and is a former Certified Association Executive (CAE). Ms. Koch was selected to serve as a director for her experience in the banking industry and her leadership, communication, and strategic planning skills developed over the course of her career.
Michael J. Morton
Michael J. Morton Michael J. Morton has been a director of the Company and Heartland Bank since April 1, 2026. Mr. Morton most recently served as Vice Chair of U.S. Commercial Banking at the Bank of Montreal (BMO) from 2020 to 2023, where he was responsible for staff development and risk oversight across multiple states and offices. He also served as Executive Vice President and Chief Credit Officer of MB Financial, Inc. from 2014 to 2019. Prior to MB Financial, Mr. Morton held various roles at several Chicagoland financial institutions and has nearly 40 years of banking experience. Mr. Morton received a BS from Illinois State University and an MBA from DePaul University. Mr. Morton was selected to serve as a director because of his extensive banking experience and the leadership, governance, risk management, and strategic planning skills he has developed throughout his career.
Gerald E. Pfeiffer
Gerald E. Pfeiffer Gerald E. Pfeiffer has been a director of the Company and Heartland Bank since 2019. Mr. Pfeiffer served as Partner/Principal at CliftonLarsonAllen LLP from 1994 until 2016, where he was responsible for audit engagement services to financial institutions and oversight of income tax, regulatory compliance and information technology services. Mr. Pfeiffer also served as the Chief Financial Officer for Bridgeview Bancorp, Inc. from January 2017 to May 2019, where he was responsible for oversight of all financial reporting functions. Mr. Pfeiffer received a BS in Accounting from Bradley University and has over 50 years of experience in providing professional services to financial institutions. Mr. Pfeiffer was selected to serve as a director for his experience overseeing financial reporting functions and providing professional services to financial institutions.
Compensation Best Practices
| What We Do | What We Do Not Do | | •Use performance-based incentives as a significant portion of our NEOs’ total compensation | •Provide tax gross-ups on severance payments | | •Use peer group compensation survey data to inform compensation decisions | •Provide walk-away cash severance payments or single-trigger cash payments upon a change in control | | •Condition annual non-equity incentive-based compensation on a variety of key performance metrics | •Reprice equity awards without prior shareholder approval | | •Maintain a clawback policy for incentive compensation | •Allow hedging of Company stock | | •Maintain stock ownership guidelines for executives and directors | •Provide excessive perquisites for our directors and NEOs | | •Annually assess the risks of our compensation program | •Pay dividends while equity awards are unvested | | •Maintain an insider trading policy | •Provide uncapped incentive awards | | •Provide for cash severance payments only upon an involuntary termination of employment where the termination was without cause or for "good reason" (whether or not such termination is in connection with a change in control) | |
The Decision-Making Process
The Decision-Making Process The Role of the Compensation Committee The Compensation Committee is responsible for, among other things, reviewing and approving executive officer and director compensation goals, objectives, and plans, including an evaluation of whether the compensation arrangements for executive officers incentivize unnecessary risk-taking. Additionally, the Compensation Committee reviews and approves employment agreements, including severance arrangements and change in control arrangements, as well as administers our stock plan and other incentive compensation plans. The Compensation Committee also periodically works with an independent consultant and management, as outlined below, to examine the effectiveness of the Company's executive compensation program. The Compensation Committee’s charter is available under the Governance page of our website at https://ir.hbtfinancial.com/. The Role of Executive Officers As requested by the Compensation Committee, some members of management support the Compensation Committee’s review and consideration of executive compensation by providing information for the Compensation Committee’s analysis and recommendation. While it maintains final discretion over all compensation decisions regarding the Executive Chairman, the Chief Executive Officer, and the other executive officers, the Compensation Committee considers and discusses the Executive Chairman's and the Chief Executive Officer’s input and recommendations. Use of Independent Consultants The Compensation Committee has authority to retain, at the Company's expense, outside counsel, experts, compensation consultants and other advisors, as needed. No compensation consultant was retained by the Compensation Committee during 2025. During 2023, the Compensation Committee retained McLagan Partners Inc., which is part of the Human Capital Solutions practice at Aon plc ("McLagan") to provide, on an as-needed basis, assistance and advice to the Compensation Committee on a variety of Compensation Committee responsibilities, such as the review of our short-term and long-term incentive plans and ongoing Compensation Committee education on compensation topics. Prior to retaining McLagan, the Compensation Committee reviewed McLagan’s independence in accordance with factors relevant to SEC and Nasdaq rules regarding independence and conflicts of interest. After considering such information, the Compensation Committee concluded that the services of McLagan did not raise any conflict of interest that would impair its independence. The Role of Peer Group Companies The Compensation Committee strives to set a competitive level of total compensation for each NEO as compared with executive officers in similar positions at peer companies. For the purposes of setting 2025 compensation, the Compensation Committee conducted an in-depth assessment of potential peer companies to evaluate the degree to which the current peer group companies appropriately reflect the Company's current size and scope. The Compensation Committee also took into consideration the broader marketplace to identify appropriate and relevant additions and removals from the current peer group companies. The peer group companies for 2025 were as follows:
Elements of Compensation
| Compensation Element | How It's Paid | Purpose | | Base Salary | Cash | Provide a competitive base salary rate relative to similar positions in the market and enable the Company to attract and retain critical executive talent. | | Short-Term Incentive Bonuses | Cash | Reward executive officers for delivering on annual strategic objectives that contribute to the creation of shareholder value. | | Long-Term Equity Incentive Awards | RSUs | RSUs link the interests of our executives to stockholders by tying a portion of our executives’ compensation to the long-term value of Company stock and also serve as a valuable retention tool. | | Long-Term Equity Incentive Awards | PRSUs | PRSUs, which are RSUs that will vest only to the extent specific financial results are met, incentivize our executives to focus on long-term sustainable shareholder value creation. | | Other Benefits | | Attract and retain executives by providing access to all employee benefit plans and other plans that support the executive's health, welfare, and retirement needs. |
Short-Term Incentive Bonuses
Short-Term Incentive Bonuses The Compensation Committee believes that performance-based compensation can and should incentivize our NEOs to drive the Company’s growth, balanced with the assumption of reasonable risk. Accordingly, we account for several performance and risk-based metrics in their annual incentive bonuses. Short-term incentive cash bonuses may be earned with actual payouts dependent on the achievement of predetermined financial performance objectives and can range from 0% to a maximum of 150% of target award amounts. Target annual award opportunities are expressed as a percentage of base salary and were established based on the NEO’s level of responsibility and their ability to impact overall results. To emphasize corporate performance, 100% of the bonus opportunities available to our NEOs are conditioned on Company performance. On an annual basis, the Compensation Committee structures the short-term incentive bonuses by selecting and weighting annual financial goals under which bonuses may be earned. In accordance with the weighting assigned by the Compensation Committee, our NEOs are eligible to earn a portion of their target bonuses if the Company attains a sufficient level of performance for a particular metric. The 2025 performance levels were established after considering the 2025 budget and historical performance. The components and results of the short-term incentive cash bonuses for our NEOs in 2025 were as follows:
Short-Term Incentive Bonuses
| (dollars in thousands) | Threshold Performance | Target Performance | Maximum Performance | Actual Result | Weighting | Payout Percentage | | Adjusted Pre-Provision Net Revenue Less Net Charge-offs (Recoveries)(1) | $79,050 | $93,000 | $106,950 | $108,680 | 25% | 37.50% | | Adjusted Return on Average Assets(2) | 1.11% | 1.30% | 1.50% | 1.58% | 25% | 37.50% | | Adjusted Efficiency Ratio (Tax Equivalent Basis)(3) | 61.00% | 56.00% | 51.00% | 51.91% | 10% | 14.09% | | Nonperforming Assets to Total Assets | 1.00% | 0.625% | 0.25% | 0.17% | 10% | 15.00% | | Relative Peer Ranking(4) | 25.00% | 50.00% | 75.00% | 90.00% | 30% | 45.00% | | Total | | | | | | 149.09% |
Short-Term Incentive Bonuses
________________________________________ (1)As calculated from our audited financial statements, "Adjusted Pre-Provision Net Revenue Less Net Charge-offs (Recoveries)" equals net interest income, plus noninterest income, less noninterest expense, and less net charge-offs (recoveries) with the following adjustments: (i) excludes acquisition expenses, (ii) excludes losses on extinguishment of debt, (iii) excludes gains (losses) on closed branch premises, (iv) excludes realized gains (losses) on sales of securities, and (v) excludes mortgage servicing rights fair value adjustment. See pages 69 to 75 of the Company's Annual Report on Form 10-K for the year ended December 31, 2025 for reconciliation of non-GAAP measures to their most closely comparable GAAP measures. (2)As calculated from our audited financial statements, "Adjusted Return on Average Assets" equals (A) net income with the following adjustments: (i) excludes acquisition expenses, (ii) excludes losses on extinguishment of debt, (iii) excludes gains (losses) on closed branch premises, (iv) excludes realized gains (losses) on sales of securities, (v) excludes mortgage servicing rights fair value adjustment, and (vi) the income tax effect of these pre-tax adjustments (as adjusted, "Adjusted Net Income") divided by (B) average assets. See pages 69 to 75 of the Company's Annual Report on Form 10-K for the year ended December 31, 2025 for reconciliation of non-GAAP measures to their most closely comparable GAAP measures. (3)As calculated from our audited financial statements, "Adjusted Efficiency Ratio (Tax-Equivalent Basis)" equals (A) noninterest expense with the following adjustments: (i) excludes amortization of intangible assets, (ii) excludes acquisition expenses, (iii) excludes losses on extinguishment of debt (as adjusted, "Adjusted Noninterest Expense") divided by (B) the sum of net interest income (tax-equivalent basis) and noninterest income with the following adjustments: (i) excludes gains (losses) on closed branch premises, (ii) excludes realized gains (losses) on sales of securities, and (iii) excludes mortgage servicing rights fair value adjustment (as adjusted, "Adjusted Operating Revenue (Tax-equivalent Basis)"). See pages 69 to 75 of the Company's Annual Report on Form 10-K for the year ended December 31, 2025 for reconciliation of non-GAAP measures to their most closely comparable GAAP measures. (4)Metric reflects the Company's relative peer ranking across 10 equally weighted performance metrics, including: Tier 1 capital to risk-weighted assets, total shareholder return, nonperforming assets to total assets, net charge-offs to average loans, return on average assets, return on average equity, return on average tangible equity, net interest margin, efficiency ratio, and core earnings per share growth. The Compensation Committee oversees performance throughout the year, evaluating progress against set objectives, and has the discretion to consider adjustments for exceptional items that may distort the assessment of normal operating performance, such as costs related to restructuring and acquisitions. These adjustments aim to maintain fairness to both participants and shareholders, while also fostering actions that promote the long-term health of the business and align with predetermined performance goals. The Compensation Committee approved bonus payouts at 149.09% of the target for the year. The table below summarizes the 2025 short-term incentive cash bonus targets and actual payouts for each NEO.
Short-Term Incentive Bonuses
| | Percentage of Base Salary | | Short-Term Incentive Cash Bonus | | | Name | Target | Actual | Target | Actual | | Fred L. Drake | 40.0% | 59.6% | $140,000 | $208,726 | | J. Lance Carter | 50.0% | 74.5% | $286,951 | $427,815 | | Peter R. Chapman | 40.0% | 59.6% | $139,776 | $208,392 | | Lawrence J. Horvath | 30.0% | 44.7% | $103,334 | $154,061 | | Mark W. Scheirer | 30.0% | 44.7% | $83,930 | $125,131 |
Long-Term Equity Incentive Awards
Long-Term Equity Incentive Awards On February 28, 2025, we granted equity awards to each executive officer with 50% of the target award value consisting of RSUs and 50% of the target award value consisting of PRSUs. The equity awards are granted under the Company's Omnibus Equity Incentive Plan, discussed below, which authorizes the grant of RSUs and PRSUs. The following table summarizes the equity awards to each of our NEOs.
Long-Term Equity Incentive Awards
| | Number of Awards | | | Total Grant Date Fair Value(3) | | Name | RSUs(1) | PRSUs(2) | Total | | | Fred L. Drake | 2,800 | 2,800 | 5,600 | $140,000 | | J. Lance Carter | 5,572 | 5,572 | 11,144 | $278,600 | | Peter R. Chapman | 2,688 | 2,688 | 5,376 | $134,400 | | Lawrence J. Horvath | 1,997 | 1,997 | 3,994 | $99,850 | | Mark W. Scheirer | 1,599 | 1,599 | 3,198 | $79,950 |
Long-Term Equity Incentive Awards
________________________________________ (1)The RSUs vest in three annual installments, with 33% vesting on February 28, 2026, 33% vesting on February 28, 2027, and 34% vesting on February 29, 2028. (2)The PRSUs vest on February 29, 2028. The number of PRSUs which may be earned and become vested depends on the Company’s achievement of average annual return on average assets ("AAROAA"), both in absolute and relative terms, over a three-year performance period covering January 1, 2025 through December 31, 2027. The following table summarizes the performance levels and related payout percentages of the PRSUs.
Long-Term Equity Incentive Awards
| 2025 - 2027 AAROAA | Peer Percentile Rank | Payout Percentage of Target PRSUs | | 1.50% or greater | Not applicable | 150% | | 0.50% or more, but less than 1.50% | 75% or above | 150% | | | 50% | 100% | | | 25% | 50% | | | Less than 25% | 25% | | Less than 0.50% | Not applicable | —% |
Long-Term Equity Incentive Awards
(3)Based on grant date stock price of $25.00. Dividend equivalents on the RSUs and PRSUs are accrued and are paid in cash at the time the RSUs and PRSUs vest. PRSUs Earned and Vested in 2025 In 2022, the executive officers at that time were granted their target PRSUs with vesting based on the average annual return on average tangible common equity ("AAROATCE") for the three-year period ended December 31, 2024. The PRSUs granted for the 2022 to 2024 performance period achieved performance above the maximum threshold, which resulted in a 150.00% payout based on the results below, and vested on February 28, 2025.
Long-Term Equity Incentive Awards
| 2022 - 2024 AAROATCE | Peer Percentile Rank | Payout Percentage of Target PRSUs | Actual Performance | Adjusted Performance(1) | Payout Percentage | | 17% or greater | Not applicable | 150% | 17.08% | 18.02% | 150.00% | | 5% or more, but less than 17% | 75% or above | 150% | | | | | | 50% | 100% | | | | | | 25% | 50% | | | | | | Less than 25% | 25% | | | | | Less than 5% | Not applicable | —% | | | |
Long-Term Equity Incentive Awards
________________________________________ (1)The Compensation Committee approved, under their authority as provided in the award agreement, an adjustment to the AAROATCE for acquisition-related expenses during the performance period. Adjusted performance reflects the AAROATCE for the three-year period ended December 31, 2024, adjusted to exclude acquisition expenses, including the day 2 provision for credit losses on non-PCD loans and unfunded commitments. Equity Plan The Company's Omnibus Equity Incentive Plan was adopted on June 25, 2019. The Omnibus Equity Incentive Plan is designed to enhance the profitability and value of the Company for the benefit of its stockholders by enabling the Company to offer eligible individuals stock-based incentives in order to attract, retain and reward such individuals and strengthen the mutuality of interests between such individuals and our stockholders. As of December 31, 2025, 1,555,818 shares were available for issuance under the Omnibus Equity Incentive Plan. Under the Omnibus Equity Incentive Plan, awards vest, become exercisable, and contain such other terms and conditions as determined by the Compensation Committee and set forth in individual agreements with the individuals receiving the awards. RSU and PRSU Awards Pursuant to the terms of the RSU and PRSU award agreements, the RSU and PRSU awards are subject to accelerated vesting under the following circumstances: RSUs: •In the event of a death or termination due to disability (each, a "Qualifying Termination") prior to the final vesting date, 100% of an NEO’s unvested RSUs will become vested. •In the event of a termination upon a "Retirement" (which is a retirement after (1) attaining either age 55 and 15 years of continuous service or age 60 and 5 years of continuous service and (2) providing sufficient notice of retirement and assisting with the transition of the NEOs’ duties to a successor) on or after the first anniversary of the grant date and prior to the final vesting date, 100% of an NEO’s unvested RSUs will become vested. •In connection with a change in control, if an NEO incurs a termination due to a Qualifying Termination, Retirement, a termination without Cause or a resignation for Good Reason, on or within 24 months of the change in control, 100% of an NEO’s unvested RSUs will become vested. PRSUs: •In the event of a Qualifying Termination on or prior to the end of the performance period, a pro rata portion of the NEO’s target number of PRSUs will remain outstanding and may become earned and vested as of the vesting date. •In connection with a Retirement on or after the first anniversary of the grant date and prior to the vesting date, a target number of the NEO’s PRSUs will remain outstanding and may become earned and vested based on actual performance. •In connection with an NEO’s termination after the performance period but prior to the vesting date due to a Qualifying Termination or a termination without Cause or a resignation for Good Reason not in connection with a change in control, 100% of such NEO’s target number of PRSUs will remain outstanding and will become vested as of the vesting date. •In connection with a change in control prior to the end of the performance period, if an NEO incurs a termination due to a Qualifying Termination, Retirement, a termination without Cause or a resignation for Good Reason, on or within 24 months of the change in control, any earned PRSUs that are then unvested will vest in full. If a recipient’s employment is otherwise terminated for any reason, then the unvested RSUs and PRSUs will be forfeited.
All Other Compensation
All Other Compensation We provide additional benefits to executive officers and other employees, which are intended to serve a different purpose than base salary, short-term incentive bonuses, and long-term equity incentive awards. While the benefits offered are competitive with the marketplace and help to attract and retain executives and employees, they also provide financial security for employees for retirement and other unforeseeable life events such as illness, disability, or death, and are generally those offered to other employees. Some additional benefits may be offered to executive officers only. Subject to periodic review and regulatory developments, we plan to continue to offer fringe benefits, the amount of which shall be determined from time-to-time in the sole discretion of the Compensation Committee. The following table illustrates additional benefits we offer to our employees, including our NEOs:
All Other Compensation
| | Executive Officers | Other Officers/Managers | Full-Time Employees | | Health Plans: | | | | | Life and Disability Insurance | X | X | X | | Medical/Dental/Vision Plans | X | X | X | | Flexible Spending Plans | X | X | X | | Health Savings Accounts | X | X | X | | Wellness Incentive Program | X | X | X | | Executive Health Assessment | X | Offered to Select Senior Officers | Not Offered | | Retirement Plans: | | | | | 401(k) Plan | X | X | X |
All Other Compensation
Heartland Bank and Trust 401(k) Profit Sharing Plan We maintain a 401(k) savings plan that allows participants, including our NEOs, to defer cash compensation (subject to applicable IRS guidelines). During 2025, all employees that were age 21 or older and had completed three months of service were eligible to participate. Beginning January 1, 2026, all employees that are age 18 or older and have completed three months of service are eligible to participate. Our NEOs are eligible to participate in the 401(k) plan on the same basis as all other employees. We provide discretionary employer matching contributions of 50% of the first 10% of an employee’s eligible compensation deferred for the year under the 401(k) plan. A discretionary match was provided in 2025.
Employment Agreements
Employment Agreements All of our NEOs are subject to employment agreements. Each agreement generally describes the position and duties of each NEO, provides for a specified term of employment, describes base salary, bonus opportunity and other benefits to which the executive officer is entitled, if any, sets forth the duties and obligations of each party in the event of a termination of employment prior to expiration of the employment term, and provides us with a measure of protection by obligating the NEO to abide by the terms of restrictive covenants during the terms of his employment and thereafter for a specified period of time. The employment agreements also include the following severance benefits that are, in each case, subject to signing a release; and are in addition to (i) all accrued benefits, as defined in the applicable employments agreements, that each such NEO may be entitled to, such as unpaid base salary, unused paid time-off, unreimbursed business expenses, and other benefits under applicable employee benefit programs, and (ii) any vesting or other treatment of outstanding equity awards upon termination, which are governed by the terms of the applicable award agreement.
Employment Agreements
| Name | Involuntary Termination or Resignation by Executive for "Good Reason" (not in Connection with a Change in Control) | Involuntary Termination or Resignation by Executive for "Good Reason" (in Connection with a Change in Control) | | Fred L. Drake | | | | Base salary | Continued payment for 6 months | Lump sum payment equal to 2 times | | Target short-term incentive bonus | — | Lump sum payment equal to 2 times | | Continued COBRA coverage | — | Lump sum payment equal to 18 months | | J. Lance Carter | | | | Base salary | Continued payment for 6 months | Lump sum payment equal to 2 times | | Target short-term incentive bonus | — | Lump sum payment equal to 2 times | | Continued COBRA coverage | — | Lump sum payment equal to 18 months | | Peter R. Chapman | | | | Base salary | Continued payment for 6 months | Lump sum payment equal to 2 times | | Target short-term incentive bonus | — | Lump sum payment equal to 2 times | | Continued COBRA coverage | — | Lump sum payment equal to 18 months | | Lawrence J. Horvath | | | | Base salary | Continued payment for 6 months | Lump sum payment equal to 1 times | | Target short-term incentive bonus | — | Lump sum payment equal to 1 times | | Continued COBRA coverage | — | Lump sum payment equal to 18 months | | Mark W. Scheirer | | | | Base salary | Continued payment for 6 months | Lump sum payment equal to 1 times | | Target short-term incentive bonus | — | Lump sum payment equal to 1 times | | Continued COBRA coverage | — | Lump sum payment equal to 18 months |
Employment Agreements
Our obligation to pay any severance under each of the employment agreements is conditioned on the execution by the NEO of a general release and waiver of any and all claims with respect to their employment with the Company. The terms of these agreements were negotiated and determined with consideration of the best interests of the Company and our stockholders. In attracting and securing a talented team of executive officers, we believe we have positioned the Company to successfully execute our growth strategy and vision.
Other Compensation-Related Governance Policies
Our Compensation Committee is responsible for administering the Ownership Policy. Generally, the Ownership Policy will be administered as described herein subject to the terms and conditions of the complete Ownership Policy. Unearned PRSUs will not be counted for purposes of achieving target ownership. However, unvested RSUs will be counted towards Ownership Policy requirements. Individuals subject to the Ownership Policy are required to achieve the applicable ownership level within three years of the original effective date of the Ownership Policy. When an individual becomes subject to the Ownership Policy subsequent to the original effective date of the Ownership Policy, or becomes subject to a greater ownership requirement (e.g., due to promotion or base salary increase), the individual should meet the required ownership amount within five years from the effective date of the increased requirement. Clawback Policy The Company has adopted a Clawback Policy consistent with the requirements of Exchange Act Rule 10D-1 and Nasdaq Listing Standards. The policy provides the Board with the authority to recover incentive compensation paid to any executive officer in an incentive compensation plan in circumstances where there has been a restatement of the Company’s financial results as reported to the SEC or where such person has engaged in specified misconduct. The policy applies to incentive compensation based on the achievement of performance criteria and includes cash bonus payments and equity incentive compensation. Insider Trading Policy The Company has adopted insider trading policies and procedures governing the purchase, sale and/or other dispositions of the Company’s securities by directors, officers, employees, contractors and consultants that the Company believes are reasonably designed to promote compliance with insider trading laws, rules and regulations, and any listing standards applicable to the Company. Among other things, the Company’s Insider Trading Policy permits open market transactions in Company stock commencing at the open of market on the second trading day following the date of public disclosure of the Company’s financial results for a particular fiscal quarter or year and continuing until the close of market on the day that is two full weeks prior to the end of the next fiscal quarter; and requires all Section 16 officers to seek pre-clearance prior to engaging in transactions in the Company’s securities. Additionally, the Insider Trading Policy provides for the use by insiders of 10b5-1 trading plans, provided that such plans are entered into during an open period when the insider is not aware of material, non-public information. Hedging Policy; Margin Accounts The Company’s Insider Trading Policy includes provisions that specifically prohibit our insiders from entering into hedging transactions involving the Company's stock. To our knowledge, none of our officers or directors have entered into a hedging transaction involving Company stock in violation of this prohibition. The Company’s Insider Trading Policy also prohibits insiders from placing the Company’s stock in margin accounts, unless they are treated as non-marginable by the brokerage firm. To our knowledge, none of our officers or directors are in violation of this prohibition. Policies and Practices Related to the Grant of Certain Equity Awards The Company does not currently grant new awards of stock options, stock appreciation rights, or similar option-like instruments ("Options"). Accordingly, the Company has no specific policy or practice on the timing of awards of Options in relation to the disclosure of material nonpublic information by the Company. In the event the Company determines to grant new awards of Options, the Board will evaluate the appropriate steps to take in relation to the foregoing. Regulatory Impact on Compensation As a publicly traded financial institution, the Company must comply with multiple layers of regulations when considering and implementing compensation decisions. Although these regulations do not set specific parameters within which compensation decisions must be made, they do require that the Company and the Compensation Committee be mindful of the risks associated with compensation programs designed to incentivize superior performance. Under the FDIC's 2015 Interagency Guidelines Establishing Standards for Safety and Soundness (the "Safety and Soundness Standards"), excessive compensation is prohibited as an unsafe and unsound practice. The FDIC has indicated that financial institutions should consider whether aggregate cash amounts paid, or non-cash benefits provided to an employee are unreasonable or disproportionate to the services the employee performs. The Safety and Soundness Standards set forth a framework within which financial institutions should evaluate an employee's compensation, with factors including compensation history, internal pay equity and, if appropriate, comparable compensation practices at peer institutions. In order to give the assessment proper context, the assessment should be made in light of the financial institution’s overall financial condition. Separately, in 2010, the federal regulatory agencies, including the FDIC, the Federal Reserve, and the Office of the Comptroller of the Currency, together, issued the Guidance on Sound Incentive Compensation Policies, (the "Joint Guidance"). The Joint Guidance complements the Safety and Soundness Standards and establishes a framework within which financial institutions must assess the soundness of their incentive compensation plans, programs and arrangements. Because the Joint Guidance is limited to senior executive officers and those other individuals who, either alone or as a group, could pose a material risk to the financial institution, it is somewhat narrower in scope than the Safety and Soundness Standards. With respect to those individuals to which it applies, the Joint Guidance aims to ensure that any available incentive compensation arrangements appropriately balance risk and reward, are compatible with effective controls and risk management and have the support of strong corporate governance. In addition to the foregoing, proposed rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") that intend to implement further risk assessment guidelines and procedures may eventually be finalized by the financial institution regulatory agencies and the SEC. Some form of proposed rules have now been issued three times: first during 2011, then again in 2016, and most recently in 2024 (which was subsequently withdrawn). However, none of those proposed rules have yet been finalized. If any such proposed rules under the Dodd-Frank Act are ever finalized, they may impose additional compensation-related risk assessment guidelines and procedures on financial institutions. The Company is also subject to the SEC's rules regarding risk assessment, which apply to all publicly traded companies. The SEC also maintains compensation risk assessment rules, applicable generally to publicly traded companies, which require the issuer to determine whether any of its existing incentive compensation plans, programs or arrangements create risks that are reasonably likely to have a material adverse effect on the issuer. The Compensation Committee completes a risk assessment of the Company's compensation programs and components on an annual basis. The Committee has determined that the Company’s incentive compensation plans, programs and arrangements do not create risks that are reasonably likely to have a material adverse effect on the Company.
2026 Compensation Decisions
•Short-Term Incentive Bonuses: the plan design for the 2026 short-term incentive bonuses was approved and remains substantially similar to the 2025 short-term incentive bonuses, except the performance levels for the adjusted pre-provision net revenue less net charge-offs (recoveries) component were revised with the threshold performance increased to $102.0 million, the target performance increased to $120.0 million, and the maximum performance increased to $138.0 million. •Discretionary Cash Bonuses: the Compensation Committee, after considering each NEOs leadership and performance related to the CNB merger, approved discretionary cash bonuses for each NEO. The amounts were based on a discretionary increase to each NEO's 2025 short-term incentive cash bonus. The table below summarizes the 2026 discretionary cash bonuses for each NEO, which were approved and paid in 2026.
2026 Compensation Decisions
| Name | Discretionary Increase | Discretionary Cash Bonus | | Fred L. Drake | 20.0% | $41,745 | | J. Lance Carter | 20.0% | $85,563 | | Peter R. Chapman | 20.0% | $41,678 | | Lawrence J. Horvath | 15.0% | $23,109 | | Mark W. Scheirer | 20.0% | $25,026 |
Summary Compensation Table
Summary Compensation Table The following table presents summary information regarding the total compensation paid to, earned by and awarded to each of our NEOs for 2025, 2024, and 2023.
Summary Compensation Table
| Name and Principal Position(s) | Year | Salary | Stock Awards | Non-Equity Incentive Plan Compensation | All Other Compensation | Total | | Fred L. Drake | 2025 | $350,000(1) | $140,000(2) | $208,726(3) | $2,235(4) | $700,961 | | Executive Chairman | 2024 | $350,000 | $178,058 | $208,012 | $2,210 | $738,280 | | | 2023 | $449,992 | $237,197 | $235,364 | $2,210 | $924,763 | | J. Lance Carter | 2025 | $570,686(1) | $278,600(2) | $427,815(3) | $17,699(4) | $1,294,800 | | President, Chief Executive Officer and Director | 2024 | $553,064 | $208,020 | $413,933 | $43,242 | $1,218,259 | | | 2023 | $514,301 | $187,258 | $274,958 | $38,948 | $1,015,465 | | Peter R. Chapman | 2025 | $346,856(1) | $134,400(2) | $208,392(3) | $14,065(4) | $703,713 | | Executive Vice President and Chief Financial Officer | 2024 | $332,923 | $128,006 | $199,692 | $12,190 | $672,811 | | | 2023 | $320,000 | $64,002 | $169,178 | $42,561 | $595,741 | | Lawrence J. Horvath(5) | 2025 | $342,208(1) | $99,850(2) | $154,061(3) | $17,359(4) | $613,478 | | Executive Vice President and Chief Lending Officer | 2024 | $330,339 | $95,986 | $148,342 | $17,128 | $591,795 | | Mark W. Scheirer(5) | 2025 | $277,205(1) | $79,950(2) | $125,131(3) | $20,495(4) | $502,781 | | Executive Vice President and Chief Credit Officer | 2024 | $264,473 | $64,042 | $118,765 | $15,940 | $463,220 |
Summary Compensation Table
________________________________________ (1)Salary increases for 2025 were effective on March 3, 2025. (2)Reflects the aggregate grant date fair value of RSU and PRSU awards calculated in accordance with FASB ASC Topic 718 and granted pursuant to the HBT Financial, Inc. Omnibus Incentive Plan. With respect to the PRSU awards, the amounts reflected assume a target level of performance, as that was the probable outcome at the time of grant. In the instance of maximum level of performance, the 2025 PRSU awards have the following values for each NEO: Mr. Drake ($105,000), Mr. Carter ($208,950), Mr. Chapman ($100,800), Mr. Horvath ($74,900), and Mr. Scheirer ($59,975). The assumptions used in calculating these amounts are set forth in Note 19 to the consolidated financial statements in our 2025 Annual Report on Form 10-K. For additional information with respect to the 2025 RSU and PRSU awards, see the Grants of Plan-Based Awards table below. (3)Amounts for 2025 represent short-term incentive cash bonuses paid in March 2026 for the 2025 performance period. For further information on the performance metrics relating to such bonuses, and the actual achievement of such metrics, see the "Compensation Discussion and Analysis – Short-Term Incentive Bonuses" section of this Proxy Statement. (4)The items comprising "All Other Compensation" for 2025 are as follows:
Summary Compensation Table
| Name | Discretionary 401(k) Match | Group Term Life Insurance Premiums | Term Life Insurance Premiums | Executive Health Assessment | Holiday Gift | Total | | Fred L. Drake | $— | $2,210 | $— | $— | $25 | $2,235 | | J. Lance Carter | $15,500 | $690 | $1,509 | $— | $— | $17,699 | | Peter R. Chapman | $11,750 | $690 | $— | $1,625 | $— | $14,065 | | Lawrence J. Horvath | $12,676 | $1,980 | $— | $2,703 | $— | $17,359 | | Mark W. Scheirer | $13,053 | $1,290 | $— | $6,152 | $— | $20,495 |
Summary Compensation Table
(5)Messrs. Horvath and Scheirer were not NEOs in 2023.
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table presents information on non-equity incentive plan awards and equity incentive awards to our NEOs during 2025.
Grants of Plan-Based Awards
| | | Compensation Committee Approval Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Performance Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock or Units(3) | Grant Date Fair Value of Stock Awards(4) | | Name | Grant Date | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | Fred L. Drake | 2/25/2025 | — | $70,000 | $140,000 | $210,000 | — | — | — | — | $— | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | 700 | 2,800 | 4,200 | — | $70,000 | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | — | — | — | 2,800 | $70,000 | | J. Lance Carter | 2/25/2025 | — | $143,475 | $286,951 | $430,426 | — | — | — | — | $— | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | 1,393 | 5,572 | 8,358 | — | $139,300 | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | — | — | — | 5,572 | $139,300 | | Peter R. Chapman | 2/25/2025 | — | $69,888 | $139,776 | $209,664 | — | — | — | — | $— | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | 672 | 2,688 | 4,032 | — | $67,200 | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | — | — | — | 2,688 | $67,200 | | Lawrence J. Horvath | 2/25/2025 | — | $51,667 | $103,334 | $155,002 | — | — | — | — | $— | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | 499 | 1,997 | 2,996 | — | $49,925 | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | — | — | — | 1,997 | $49,925 | | Mark W. Scheirer | 2/25/2025 | — | $41,965 | $83,930 | $125,895 | — | — | — | — | $— | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | 400 | 1,599 | 2,399 | — | $39,975 | | | 2/28/2025 | 2/25/2025 | $— | $— | $— | — | — | — | 1,599 | $39,975 |
Grants of Plan-Based Awards
________________________________________ (1)The amounts set forth in the "Estimated Future Payouts Under Non-Equity Incentive Plan Awards" columns reflect the potential threshold, target, and maximum payouts for the short-term incentive bonuses based on 2025 performance when the 2025 performance goals were originally set. The amounts actually paid for 2025 appear in the "Non-Equity Incentive Plan Compensation" column of the Summary Compensation Table above. For a description of the metrics relating to such bonuses, and the actual achievement of such metrics, see the "Compensation Discussion and Analysis – Short-Term Incentive Bonuses" section of this Proxy Statement. (2)The amounts set forth in the "Estimated Future Payouts Under Performance Equity Incentive Plan Awards" columns reflect the threshold, target, and maximum payouts for the PRSUs during a three-year performance period. For a description of the PRSUs, see the "Compensation Discussion and Analysis – Long-Term Equity Incentive Awards" section of this Proxy Statement. (3)The amounts set forth in the "All Other Stock Awards: Number of Shares of Stock or Units" column reflects time-based RSUs. For a description of the RSUs, see the "Compensation Discussion and Analysis – Long-Term Equity Incentive Awards" section of this Proxy Statement. (4)The grant date fair value of time-based RSUs is calculated in accordance with FASB ASC Topic 718 and based on the value of the underlying shares on the grant date. The grant date fair value of PRSUs is calculated in accordance with FASB ASC Topic 718 and based on the probable outcome of the performance condition on the grant date.
Outstanding Equity Awards at 2025 Year End
Outstanding Equity Awards at 2025 Year End The following table summarizes, for each of our NEOs, the number of shares of our common stock underlying outstanding equity awards held as of December 31, 2025.
Outstanding Equity Awards at 2025 Year End
| | Option Awards | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Fred L. Drake | — | — | — | — | 7,705(2) | $199,174(3) | 19,037(2) | $492,106(3) | | J. Lance Carter | 6,120(1) | — | $16.32 | 9/1/2029 | 10,629(2) | $274,760(3) | 22,726(2) | $587,467(3) | | Peter R. Chapman | — | — | — | — | 11,970(2) | $309,425(3) | 13,295(2) | $343,676(3) | | Lawrence J. Horvath | 6,120(1) | — | $16.32 | 9/1/2029 | 4,358(2) | $112,654(3) | 9,748(2) | $251,986(3) | | Mark W. Scheirer | 6,120(1) | — | $16.32 | 9/1/2029 | 3,090(2) | $79,877(3) | 6,530(2) | $168,801(3) |
Outstanding Equity Awards at 2025 Year End
(1)Reflects cash-settled stock appreciation rights. Upon exercise of a stock appreciation right, the holder is entitled to receive a lump sum cash payment in an amount equal to the excess of the Company’s stock price on the date of exercise over the exercise price specified in the stock appreciation rights agreement. (2)Reflects unvested RSUs and unearned PRSUs, as applicable, with dividend equivalent rights, which vest in accordance with the schedules set forth below, subject to the participant’s continued service through the vesting date. The number of PRSUs are reported at maximum performance.
Outstanding Equity Awards at 2025 Year End
| | | Number of Shares | | | Name | Vesting Date | Restricted Stock Units | Performance Restricted Stock Units | | Fred L. Drake | 2/28/2026 | 4,241 | 7,830 | | | 2/28/2027 | 2,512 | 7,007 | | | 2/29/2028 | 952 | 4,200 | | J. Lance Carter | 2/28/2026 | 5,041 | 6,182 | | | 2/28/2027 | 3,694 | 8,186 | | | 2/29/2028 | 1,894 | 8,358 | | Peter R. Chapman | 2/28/2026 | 9,027 | 4,226 | | | 2/28/2027 | 2,029 | 5,037 | | | 2/29/2028 | 914 | 4,032 | | Lawrence J. Horvath | 2/28/2026 | 2,164 | 2,975 | | | 2/28/2027 | 1,515 | 3,777 | | | 2/29/2028 | 679 | 2,996 | | Mark W. Scheirer | 2/28/2026 | 1,448 | 1,611 | | | 2/28/2027 | 1,098 | 2,520 | | | 2/29/2028 | 544 | 2,399 |
Outstanding Equity Awards at 2025 Year End
(3)Market value is calculated based on the closing stock price of $25.85 on December 31, 2025.
Stock Vested
Stock Vested The following table sets forth information concerning the vesting of stock awards with respect to each NEO in 2025.
Stock Vested
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | Fred L. Drake | 14,552 | $363,800 | | J. Lance Carter | 12,074 | $301,850 | | Peter R. Chapman | 7,934 | $198,350 | | Lawrence J. Horvath | 5,776 | $144,400 | | Mark W. Scheirer | 3,231 | $80,775 |
Stock Vested
________________________________________ (1)The amounts set forth in this column represent the number of shares of RSUs and PRSUs that vested in 2025. (2)The amounts set forth in this column represent the number of shares of RSUs and PRSUs that vested multiplied by the closing price of our common stock on the vesting date.
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control The following table summarizes, for each of our NEOs, potential payments and benefits under our compensation programs and benefit plans that each NEO may be entitled to upon various terminations of employment or a change in control, assuming that such event occurred on the last business day of the year ended December 31, 2025:
Potential Payments Upon Termination or Change in Control
| Name | Cash Severance Payments | COBRA Continuation | Equity Awards(1) | Total Payments | | Termination by the Company without "Cause" or Resignation by the NEO for "Good Reason" (in connection with a change in control)(2)(3) | | | | | | Fred L. Drake | $980,000 | $31,189 | $691,281 | $1,702,470 | | J. Lance Carter | $1,721,704 | $42,885 | $862,227 | $2,626,816 | | Peter R. Chapman | $978,432 | $32,690 | $653,100 | $1,664,222 | | Lawrence J. Horvath | $447,782 | $32,690 | $364,640 | $845,112 | | Mark W. Scheirer | $363,696 | $29,545 | $248,677 | $641,918 | | Termination by NEO's Qualifying Retirement or Death or Disability (in connection with a change in control)(3) | | | | | | Fred L. Drake | $— | $— | $691,281 | $691,281 | | J. Lance Carter | $— | $— | $862,227 | $862,227 | | Peter R. Chapman | $— | $— | $653,100 | $653,100 | | Lawrence J. Horvath | $— | $— | $364,640 | $364,640 | | Mark W. Scheirer | $— | $— | $248,677 | $248,677 | | Termination by the Company without "Cause" or Resignation by the NEO for "Good Reason" (not in connection with a change in control)(2)(3) | | | | | | Fred L. Drake | $175,000 | $— | $— | $175,000 | | J. Lance Carter | $286,951 | $— | $— | $286,951 | | Peter R. Chapman | $174,720 | $— | $— | $174,720 | | Lawrence J. Horvath | $172,224 | $— | $— | $172,224 | | Mark W. Scheirer | $139,883 | $— | $— | $139,883 | | Qualifying Retirement (not in connection with a change in control)(3) | | | | | | Fred L. Drake | $— | $— | $510,331 | $510,331 | | J. Lance Carter | $— | $— | $— | $— | | Peter R. Chapman | $— | $— | $— | $— | | Lawrence J. Horvath | $— | $— | $235,571 | $235,571 | | Mark W. Scheirer | $— | $— | $— | $— | | Death or Disability (not in connection with a change in control)(3) | | | | | | Fred L. Drake | $— | $— | $691,281 | $691,281 | | J. Lance Carter | $— | $— | $647,646 | $647,646 | | Peter R. Chapman | $— | $— | $540,239 | $540,239 | | Lawrence J. Horvath | $— | $— | $364,640 | $364,640 | | Mark W. Scheirer | $— | $— | $185,629 | $185,629 |
Potential Payments Upon Termination or Change in Control
________________________________________ (1)Market value is calculated based on the closing stock price of $25.85 on December 31, 2025. (2)See the "Compensation Discussion and Analysis – Employment Agreements" section for additional details on the cash severance payments and COBRA continuation benefits provided to each NEO in the event of a termination by the Company without "Cause" or a resignation by each NEO for "Good Reason." (3)See the "Compensation Discussion and Analysis – Long-Term Equity Incentive Awards" section for additional details on the potential RSU and PRSU payments and benefits to each NEO upon the occurrence of the triggering event on the last business day of the ended December 31, 2025.
CEO Pay Ratio
CEO Pay Ratio As required by Section 953(b) of the Dodd-Frank Act, and Item 402(u) of Regulation S-K, we are providing information about the relationship of the annual total compensation of Mr. Carter, our President and Chief Executive Officer, to the total compensation of our median employee. To determine the median employee, a list of all active full and part-time employees as of December 31, 2025, excluding Mr. Carter, was prepared with the corresponding annual total W-2 compensation as reflected in our payroll records. We believe this is a reasonable measure of total compensation. Our employee population consisted of 887 employees as of December 31, 2025. Compensation was annualized for any individual not employed for the full calendar year of 2025. Annual total W-2 compensation was ranked from lowest to highest, and the median employee was selected from the list. Mr. Carter had 2025 total compensation of $1,294,800, as reflected in the Summary Compensation Table included in this Proxy Statement. The median employee annual total compensation for 2025, using the methodology that was used to calculate Mr. Carter’s compensation in the Summary Compensation Table, was $59,239. As a result, the CEO pay ratio is 22 to 1. The SEC rules for identifying the median employee and calculating the pay ratio allow companies to adopt a variety of methodologies, apply certain exclusions, and make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act"), we provide the following disclosure regarding executive "compensation actually paid" and certain Company financial performance measures for the fiscal years listed below. You should refer to our CD&A disclosure, elsewhere in this Proxy Statement, for a complete description of how executive compensation relates to Company performance and how the Compensation Committee makes its decisions.
Pay Versus Performance Table
Pay Versus Performance Table The Pay Versus Performance Table below summarizes the compensation values both previously reported in our Summary Compensation Table and as required to be adjusted by the rules adopted by the SEC pursuant to the Dodd-Frank Act and certain financial performance measures for the years listed.
Pay Versus Performance Table
| | | | | | | | Value of Initial Fixed $100 Investment Based on: | | | Company- Selected Measure | | Year | Summary Compensation Table Total for CEO Mr. Carter(1) | Compensation Actually Paid to CEO Mr. Carter(2) | Summary Compensation Table Total for CEO Mr. Drake(1) | Compensation Actually Paid to CEO Mr. Drake(2) | Average Summary Compensation Table Total for non-CEO NEOs(3) | Average Compensation Actually Paid to non-CEO NEOs(4) | Total Shareholder Return(5) | Peer Group Total Shareholder Return(6) | Net Income(7) | Adjusted Earnings Per Share - Diluted(8) | | 2025 | $1,294,800 | $1,490,449 | $— | $— | $630,233 | $740,219 | $158.91 | $108.55 | $77,008,000 | $2.52 | | 2024 | $1,218,259 | $1,335,195 | $— | $— | $616,527 | $688,248 | $130.02 | $103.80 | $71,780,000 | $2.37 | | 2023 | $1,015,465 | $1,137,797 | $924,763 | $1,079,179 | $595,741 | $623,058 | $120.66 | $90.55 | $65,842,000 | $2.46 | | 2022 | $— | $— | $1,165,497 | $1,163,578 | $946,185 | $943,896 | $108.06 | $92.12 | $56,456,000 | $1.93 |
Pay Versus Performance Table
________________________________________ (1)On May 24, 2023, Mr. Carter transitioned to the role of President and Chief Executive Officer of the Company and Heartland Bank. Prior to May 24, 2023, Mr. Drake served as our Chief Executive Officer. (2)The dollar amounts reported represent compensation actually paid, as calculated in accordance with SEC rules, to our CEO for the covered fiscal year. See the "Calculation of Compensation Actually Paid" section below for further details. (3)Our non-CEO NEOs were Messrs. Drake, Chapman, Horvath, and Scheirer for 2025 and 2024; Mr. Chapman for 2023; and Messrs. Carter and Busch for 2022. (4)The dollar amounts reported represent average compensation actually paid, as calculated in accordance with SEC rules, to our non-CEO NEOs for the covered fiscal year. See the "Calculation of Compensation Actually Paid" section below for further details. (5)The Company’s cumulative total shareholder return, as of the last day of each reported year, is based on an initial fixed investment of $100 on December 31, 2021. (6)Reflects the cumulative total shareholder return of the S&P Small Cap 600 Bank Index, as of the last day of each reported year, based on an initial fixed investment of $100 on December 31, 2021. The S&P Small Cap 600 Bank Index is the published industry or line-of-business index used by the Company for purposes of Item 201(e) of Regulation S-K under the Exchange Act in our Annual Report on Form 10-K for the year ended December 31, 2025. (7)The Company's net income is reported in the Company's audited financial statements on our Annual Report on Form 10-K for the applicable fiscal year. (8)Adjusted earnings per share – diluted is the company-selected measure and is a non-GAAP financial measure. As calculated from the Company's audited financial statements, adjusted earnings per share – diluted equals Adjusted Net Income allocated to common shares divided by weighted average common shares outstanding, including all dilutive potential shares. See pages 69 to 75 of the Company's Annual Report on Form 10-K for the year ended December 31, 2025 for a reconciliation of non-GAAP measures to their most closely comparable GAAP measures.
Calculation of Compensation Actually Paid
Calculation of Compensation Actually Paid To calculate the amounts of "compensation actually paid" to our CEO and, on an average basis, our other NEOs, as reported in the table above, the following adjustments were made to total compensation as reported in the Summary Compensation Table.
Calculation of Compensation Actually Paid
| | 2025 | | 2024 | | | | CEO Mr. Carter | Non-CEO NEOs (Average) | CEO Mr. Carter | Non-CEO NEOs (Average) | | Total Compensation from Summary Compensation Table | $1,294,800 | $630,233 | $1,218,259 | $616,527 | | Equity Awards Adjustments(1) | | | | | | Deduct: Summary Compensation Table grant date fair value of equity awards granted during fiscal year | 278,600 | 113,550 | 208,020 | 116,523 | | Add: Fair value as of fiscal year end of equity awards granted during the fiscal year that are outstanding and unvested as of the fiscal year end | 360,091 | 146,770 | 298,782 | 167,360 | | Add: Change as of fiscal year end in fair value of equity awards granted in any prior year that are outstanding and unvested as of fiscal year end | 76,729 | 52,359 | 57,614 | 39,934 | | Add: Change as of the vesting date (from end of prior fiscal year) in fair value of any equity awards granted in any prior year that vested during or at the end of the fiscal year | 37,429 | 24,407 | (31,440) | (19,050) | | Total Equity Awards Adjustments | 195,649 | 109,986 | 116,936 | 71,721 | | Compensation Actually Paid | $1,490,449 | $740,219 | $1,335,195 | $688,248 |
Calculation of Compensation Actually Paid
| | 2023 | | | 2022 | | | | CEO Mr. Carter | CEO Mr. Drake | Non-CEO NEOs (Average) | CEO Mr. Drake | Non-CEO NEOs (Average) | | Total Compensation from Summary Compensation Table | $1,015,465 | $924,763 | $595,741 | $1,165,497 | $946,185 | | Equity Awards Adjustments(1) | | | | | | | Deduct: Summary Compensation Table grant date fair value of equity awards granted during fiscal year | 187,258 | 237,197 | 64,002 | 234,848 | 181,045 | | Add: Fair value as of fiscal year end of equity awards granted during the fiscal year that are outstanding and unvested as of the fiscal year end | 173,989 | 220,389 | 59,467 | 240,124 | 185,113 | | Add: Change as of fiscal year end in fair value of equity awards granted in any prior year that are outstanding and unvested as of fiscal year end | 120,594 | 152,475 | 31,852 | (8,710) | (7,450) | | Add: Change as of the vesting date (from end of prior fiscal year) in fair value of any equity awards granted in any prior year that vested during or at the end of the fiscal year | 15,007 | 18,749 | — | 1,515 | 1,093 | | Total Equity Awards Adjustments | 122,332 | 154,416 | 27,317 | (1,919) | (2,289) | | Compensation Actually Paid | $1,137,797 | $1,079,179 | $623,058 | $1,163,578 | $943,896 |
Calculation of Compensation Actually Paid
(1)Compensation Actually Paid amounts are calculated using the fair value or change in fair value, as applicable, of equity award adjustments in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant.
Pay Versus Performance: Graphical Presentation
Pay Versus Performance: Graphical Presentation The following charts present the relationship between the "compensation actually paid" to our CEO and to, on an average basis, our other NEOs and the following: •the Company’s cumulative total shareholder return and the peer group’s cumulative total shareholder return; •net income; and •the company-selected measure, adjusted earnings per share – diluted.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION The following table presents the total compensation we paid to non-employee directors for service on our Board during 2025. None of the directors receive any compensation or other payment in connection with his or her service as a director other than compensation received from the Company as set forth below.
DIRECTOR COMPENSATION
| Name(1)(2) | Fees Earned or Paid in Cash ($) | Stock Awards ($)(3) | All Other Compensation ($)(4) | Total ($) | | James T. Ashworth(5) | $— | $— | $— | $— | | Roger A. Baker | $27,775 | $15,000 | $6,175 | $48,950 | | C. Alvin Bowman | $31,975 | $15,000 | $8,250 | $55,225 | | Eric E. Burwell | $32,900 | $15,000 | $6,175 | $54,075 | | Patrick F. Busch | $— | $— | $— | $— | | Allen C. Drake | $30,075 | $15,000 | $7,475 | $52,550 | | Linda J. Koch | $30,350 | $15,000 | $6,175 | $51,525 | | Michael J. Morton(5) | $— | $— | $— | $— | | Gerald E. Pfeiffer | $38,075 | $15,000 | $6,175 | $59,250 | | Nancy L. Ruyle(5) | $— | $— | $— | $— |
DIRECTOR COMPENSATION
__________________________________________ (1)None of our employee directors received compensation for their service on our Board during 2025. (2)Mr. Busch received no compensation for his service on our Board but received $471,385 for his service as Vice Chairman of Heartland Bank during 2025. (3)Reflects the grant date fair value of awards of time-based restricted stock units with dividend equivalent rights granted in 2025. The grant date fair value was calculated in accordance with FASB ASC Topic 718, based on the value of the underlying shares on the date of the grant, which was $25.00. Assumptions used in calculating the value of these awards are discussed in Note 19 to the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2025. The following table lists the aggregate number of unvested restricted stock units outstanding at fiscal year-end for each non-employee director.
DIRECTOR COMPENSATION
| Name | Restricted Stock Units | | Roger A. Baker | 600 | | C. Alvin Bowman | 600 | | Eric E. Burwell | 600 | | Allen C. Drake | 600 | | Linda J. Koch | 600 | | Gerald E. Pfeiffer | 600 |
DIRECTOR COMPENSATION
(4)Reflects $6,175 in director fees from Heartland Bank for Mr. Baker, Mr. Bowman, Mr. Burwell, Ms. Koch, and Mr. Pfeiffer, $5,400 in director fees from Heartland Bank for Mr. Drake, and an additional $2,075 in committee fees from Heartland Bank for Messrs. Bowman and Drake. (5)Mr. Ashworth, Mr. Morton, and Ms. Ruyle were appointed to the Board in 2026. As a result, they did not receive compensation for service on our Board during the year ended December 31, 2025. During 2025 and 2026, each of our non-employee directors have been paid quarterly cash fees from their annual retainer and, when applicable, for attending committee or Company Board meetings and have received an annual equity award grant as follows: Through February 28, 2025, each of our non-employee directors received an annual retainer of $18,000. The Chair of the Audit Committee received an additional annual fee of $7,500; the Chair of the Compensation Committee received an additional annual fee of $5,000; the Chair of the Nominating and Corporate Governance Committee received an additional annual fee of $3,000; and the Chair of Heartland Bank's Trust Committee received an additional annual fee of $5,000. We also paid our non-employee directors a meeting fee of $750 for each meeting of the Company’s Board, a meeting fee of $500 for each committee meeting, and a meeting fee of $750 for each meeting of Heartland Bank’s board of directors. In addition, on February 28, 2025, we made an annual equity award to each of our non-employee directors of 600 restricted stock units. The time-based restricted stock units vested on February 28, 2026. From March 1, 2025 through February 28, 2026, each of our non-employee directors received an annual retainer of $19,000. The Chair of the Audit Committee will receive an additional annual fee of $7,800; the Chair of the Compensation Committee will receive an additional annual fee of $5,200; the Chair of the Nominating and Corporate Governance Committee will receive an additional annual fee of $3,200; and the Chair of Heartland Bank's Trust Committee will receive an additional annual fee of $5,200. We will also pay our non-employee directors a meeting fee of $775 for each meeting of the Company’s Board, a meeting fee of $525 for each committee meeting and a meeting fee of $775 for each meeting of Heartland Bank’s board of directors. Beginning March 1, 2026, each of our non-employee directors received an annual retainer of $20,000. The Chair of the Audit Committee will receive an additional annual fee of $10,000; the Chair of the Compensation Committee will receive an additional annual fee of $6,000; the Chair of the Nominating and Corporate Governance Committee will receive an additional annual fee of $4,000; and the Chair of Heartland Bank's Trust Committee will receive an additional annual fee of $6,000. We will also pay our non-employee directors a meeting fee of $800 for each meeting of the Company’s Board, a meeting fee of $600 for each committee meeting and a meeting fee of $800 for each meeting of Heartland Bank’s board of directors.