UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

 

 

SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

 

 

 

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UNITED COMMUNITY BANKS, INC.

 

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Letter to our Shareholders

 

 

 

April 6, 2022

 

Dear Fellow Shareholders: 

 

  

We will hold the 2022 Annual Meeting of Shareholders (the “2022 Annual Meeting”) of United Community Banks, Inc. at 3:00 P.M. Eastern time on Wednesday, May 18, 2022. Due to the continuing potential public health impact of the COVID-19 pandemic and to support the health and well-being of our employees and shareholders, the 2022 Annual Meeting will again this year be held in a virtual meeting format only. You will not be able to attend the 2022 Annual Meeting physically.

 

As in prior years, we have again elected to provide access to our proxy materials over the Internet under the Securities and Exchange Commission’s “notice and access” rules. The accompanying Notice of 2022 Annual Meeting of Shareholders and Proxy Statement describes the matters to be acted upon and is available at www.proxyvote.com and at our corporate website www.ucbi.com. The Annual Report to Shareholders and our Annual Report on Form 10-K for the year ended December 31, 2021 are also available at those websites.

 

It is important that your shares be represented at the 2022 Annual Meeting. To be admitted to the 2022 Annual Meeting at www.virtualshareholdermeeting.com/UCBI2022, you must enter the control number found on your proxy card, voting instruction form or notice you previously received. You may vote during the 2022 Annual Meeting by following the instructions available on the meeting website during the meeting. We hope you will participate in the 2022 Annual Meeting. However, even if you anticipate participating in the virtual meeting, we urge you to please vote your proxy either by mail, telephone or over the Internet in advance of the 2022 Annual Meeting to ensure that your shares will be represented.

 

I look forward to updating you on developments in our business at the 2022 Annual Meeting.

 

Sincerely,

 

 

H. LYNN HARTON 

Chairman, President and Chief Executive Officer

 

 

2  WEST  WASHINGTON  STREET,  SUITE  700   |   GREENVILLE,  SOUTH  CAROLINA  29601

 


 

Notice of Virtual Annual Meeting of Shareholders

 

Date and Time: May 18, 2022
  3:00 P.M. Eastern Time
     
Place: There will be no physical location for shareholders to attend.
  Shareholders may only participate online by logging in virtually at ww.virtualshareholdermeeting.com/ucbi2022.
   
Items of Business: 1. To elect the eleven nominees listed in the accompanying Proxy Statement to our Board of Directors
  2. To approve the United Community Banks, Inc. 2022 Omnibus Equity Plan
  3. To approve, on an advisory basis, the compensation paid to our Named Executive Officers
  4. To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022
  5. To transact such other business as may properly be presented at the 2022 Annual Meeting of Shareholders or any adjournment thereof
     
Record Date: You may vote at the meeting if you were a shareholder of record at the close of business on March 21, 2022.
   
Voting by Proxy: You may vote your shares by Internet or telephone as directed in the proxy materials. If you received a printed copy of the proxy materials, you may also complete, sign and return the enclosed proxy card or voting instruction form by mail. Voting in any of these ways will not prevent you from attending or voting your shares at the meeting. We encourage you to vote by Internet or telephone to reduce mailing and handling expenses.
   
Internet Availability of Proxy Materials: Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Held on May 18, 2022: The solicitation of the enclosed proxy is made on behalf of the Board of Directors for use at the Shareholder Meeting to be held on May 18, 2022. It is expected that this Proxy Statement and related materials will first be provided to shareholders on or about April 6, 2022. A copy of this Notice of Virtual Annual Meeting of Shareholders of United Community Banks, Inc. and Proxy Statement is available at: www.virtualshareholdermeeting.com/ucbi2022. Also available at this website is our 2021 Annual Report and our Annual Report on Form 10-K for the year ended December 31, 2021.

 

By order of the Board of Directors

 

Melinda Davis Lux 

General Counsel and Corporate Secretary

 

Greenville, South Carolina 

April 6, 2022

  


 

Proxy Statement

 

Table of Contents

 

Summary 1
   
Proxy Materials 1
   
Proposals for Your Vote at the 2022 Annual Meeting 1
   
Voting Your Shares 1
   
Participating in the Virtual 2022 Annual Meeting 1
   
Additional Information 1
   
Proposal 1: Election of Directors 2
   
Overall Board Composition and Size 3
   
Identifying and Evaluating Director Candidates 3
   
Board Qualifications and Experience 4
   
Director Nominees for Election 6
   
Process for Shareholder to Recommend Individuals for Consideration by the Nominating and Corporate Governance Committee 12
   
Corporate Governance 13
   
Our Board of Directors 13
   
Director Independence 14
   
Board Leadership Structure 14
   
Board Evaluation 15
   
CEO and Key Management Succession Planning 15
   
Board Committees 15
   
Board and Committee Meeting Attendance 18
   
Board Oversight of Risk 18
   
Audit Committee Financial Expert 18
   
Share Ownership Guidelines and Anti-Hedging Policy 18
   
Code of Ethical Conduct 19
   
Communications with Board of Directors 19
   
Corporate Governance Information 19
   
Director Compensation 20
   
Transactions with Management and Others 21
   
Policy with Respect to Approval of Related Party Transactions 21
   
2021 Related Party Transactions 21
   
Proposal 2: Approval of the 2022 Omnibus Equity Plan 22
   
Highlights of the 2022 Plan 22
   
Description of the 2022 Plan 23
New Plan Benefits 26
   
Federal Tax Consequences 27
   
Equity Compensation Plan Information 28
   
Executive Officers 29
   
Proposal 3: Advisory Vote to Approve Named Executive Officer Compensation 30
   
Executive Compensation 31
   
Compensation Discussion and Analysis 31
   
Summary Compensation Table 48
   
Grant of Plan-Based Awards 49
   
Outstanding Equity Awards at Fiscal Year-End 50
   
Stock Vested 51
   
Pension Benefits 51
   
Nonqualified  Deferred Compensation 52
   
Potential Payouts Upon Termination or Change of Control 52
   
Compensation Committee Interlocks and Insider Participation 53
   
Compensation Risk Considerations 54
   
CEO Pay Ratio Disclosure 55
   
Security Ownership 56
   
Security Ownership of Certain Beneficial  Owners 56
   
Security Ownership of Management 57
   
Audit Committee Report 58
   
Proposal 4: Ratification of Appointment of Independent Registered Public Accounting Firm 59
   
Fees Paid to Auditors 60
   
Solicitation, Meeting and Voting Information 61
   
Shareholder Proposals for 2023 Annual Meeting of Shareholders 68
   
Shareholder Proposals 68
   
Other Business at 2023 Annual Meeting of Shareholders 68
   
Appendix 1: United Community Banks, Inc. 2022 Omnibus Equity Plan A-i


 


Summary

 

The 2022 Annual Meeting of Shareholders of United Community Banks, Inc. (the “2022 Annual Meeting”) will be held exclusively online via the Internet at 3:00 P.M. Eastern time on Wednesday, May 18, 2022.

 

We have tried to make this document simple and easy to understand. The Securities and Exchange Commission encourages companies to use “plain English,” and we always try to communicate with you clearly and effectively. We will refer to United Community Banks, Inc. throughout as “we,” “us,” the “Company” or “United.” Additionally, unless otherwise noted or required by context, “2022,”“2021,”“2020” and “2019” refer to our fiscal years ended or ending December 31, 2022, 2021, 2020 and 2019, respectively.

 

Proxy Materials 

We plan to send a Notice of Internet Availability of Proxy Materials (the “Notice”) to our shareholders instead of paper copies of our “Proxy Materials” (the Notice of 2022 Annual Meeting of Shareholders and Proxy Statement, our 2021 Annual Report to Shareholders, our Annual Report on Form 10-K for the year ended December 31, 2021 and the Proxy Card or voting instruction form). The Notice, which is expected to be mailed to shareholders on or about April 6, 2022, contains instructions on how to access our Proxy Materials on the Internet or how to request paper or email copies of the Proxy Materials.

 

Proposals for Your Vote at the 2022 Annual Meeting

 

  Proposal Board Voting Recommendation Page
1. Electing Directors “FOR” each nominee 2
2. Approving Our 2022 Omnibus Equity Plan “FOR” 22

3.

Approving Our Executive Compensation (“Say-on-Pay” Proposal)

“FOR” 

30

4.

Ratifying the Appointment of Our Independent Registered Public Accounting Firm for 2022

“FOR”

59

 

Voting Your Shares 

It is important that your shares be represented at the 2022 Annual Meeting. We urge you to please vote your proxy in advance of 

the 2022 Annual Meeting to ensure that your shares will be represented either:

 

By Internet: Access www.proxyvote.com (you will need the control number from your Notice); or

By Telephone: Call the toll-free number specified after accessing the Proxy Materials on www.proxyvote.com or on the Proxy Card that you receive if you requested printed copies of the Proxy Materials; or

By Mail: Request paper copies of the Proxy Materials which will include a Proxy Card that includes instructions for voting by mail.

 

You may also vote during the 2022 Annual Meeting by following the instructions available on the meeting website during the meeting. We hope you will participate in the 2022 Annual Meeting. However, even if you anticipate participating in the virtual meeting, we urge you to please vote your proxy either by Internet, telephone or mail in advance of the Annual Meeting to ensure that your shares will be represented.

 

If your shares are held by a broker, bank or other nominee (this is called “street name”), your broker, bank or other nominee will send you instructions for voting those shares. Many (but not all) brokerage firms, banks and other nominees participate in a program that offers various voting options.

 

Participating in the Virtual 2022 Annual Meeting 

To be admitted to the 2022 Annual Meeting at www. virtualshareholdermeeting.com/UCBI2022, you must enter the control number found on your Notice, Proxy Card or voting instruction form that you receive.

 

Additional Information 

See Solicitation, Meeting and Voting Information on page 61 for additional information about our Proxy Materials, proposals for your vote at the 2022 Annual Meeting, voting your shares and participating in the virtual 2022 Annual Meeting.

  

1

 

Proposal 1: Election of Directors

 

The Board of Directors (the “Board”) has nominated 11 directors, who, if elected by shareholders at the 2022 Annual Meeting, will be expected to serve until next year’s annual meeting and until their respective successors are elected and qualified. All nominees currently serve as directors on our Board. Other than Jennifer M. Bazante , who was appointed to our Board in September 2021, all nominees were elected by you at our 2021 Annual Meeting of Shareholders. Each director nominee has consented to being named in this Proxy Statement and to serving as a director if elected. If any nominee is unable to stand for election for any reason, the shares represented at our 2022 Annual Meeting may be voted for another candidate proposed by our Board, or our Board may choose to reduce its size.

 

Nominee Age Principal Occupation Director
Since
Independent Other Public
Boards
Committee Membership
(C= Chair)

Jennifer M.
Bazante

57

Chief Marketing Officer,
Humana

2021

Yes

None

None

Robert H.
Blalock

74

Former Chief Executive Officer,
Blalock Insurance
Agency, Inc.

2000

Yes

None

Audit
Risk

James P.
Clements

58

President,
Clemson University

2020

Yes

None

Nominating and Corporate Governance
Talent and Compensation

Kenneth L.
Daniels

70

Former Chief Credit
Risk & Policy Officer,
Sr. Risk Advisor, BB&T

2015

Yes

None

Audit
Executive
Risk ( C )
Talent and Compensation

Lance F. Drummond

67

Former Executive Vice President of Operations and Technology,
TD Canada Trust

2018

Yes

1

Executive
Nominating and Corporate Governance ( C ) Risk
Talent and Compensation

H. Lynn Harton

60

Chairman, President and Chief
Executive Officer,
United Community Banks, Inc.

2015

No

None

Executive ( C )

Jennifer K.
Mann

51

Executive Vice
President of Human Resources,
SAS

2018

Yes

None

Executive
Talent and Compensation ( C )

Thomas A.
Richlovsky

70

Former Executive
Vice President,
PNC Financial Services Group

2012

Yes

None

Lead Director Audit Executive
Nominating and Corporate Governance Risk

David C. Shaver

72

Chief Executive Officer,
Cost Segregation
Advisors, LLC

2016

Yes

None

Audit ( C ) Executive
Talent and Compensation

Tim R. Wallis

70

President,
Wallis Printing

1999

Yes

None

Audit

Ambassador
David H. Wilkins

75

Former US Ambassador to Canada;
Former Speaker, SC House of
Representatives;
Partner, Nelson Mullins Riley &
Scarborough

2016

 

Yes

None

Risk

 

2

 

Overall Board Composition and Size

 

    Our Board’s current composition has resulted from a thoughtful process of:
Our Bylaws provide that the number of directors on the Board may range from eight to fourteen. The Board’s current size is 11 directors and may fluctuate in the future as the Board recruits new directors.   Analyzing the effectiveness of our Board
     
  Identifying the qualifications and experience that we believe should be represented on our Board in light of our industry, business strategy, and risk appetite
     
  Considering the diversity of viewpoints, professional experience, education, qualifications, and skills that each of our Board members bring to the Board
     
  Recognizing that the strength of our Board is driven by the collective qualifications and skills of our Board members combined with engaged and open dialogue

  

Identifying and Evaluating Director Candidates

 

Our Board regularly reviews and evaluates its composition. Our Nominating and Corporate Governance Committee is responsible for identifying and recommending director candidates to our Board for nomination using a director selection process. The Board, in coordination with the Nominating and Corporate Governance Committee, also considers Board leadership succession planning and committee membership.

 

The Nominating and Corporate Governance Committee uses a variety of methods to identify potential director candidates, including recommendations that it receives from:

 

Directors

Shareholders

Management and contacts in the communities we serve

Third-party search firms

 

From time to time, the Nominating and Corporate Governance Committee retains a third-party search firm to assist in identifying potential Board candidates who meet our qualification and experience requirements and, for any such candidate identified by the search firm, to compile and evaluate information regarding the candidate’s qualifications, experience, and education. In 2021, the Nominating and Corporate Governance Committee utilized the services of a third-party search firm.

 

When considering a candidate for membership on the Board, the Nominating and Corporate Governance Committee assesses a candidate’s independence, qualifications, skills, and experience, as compared to the areas of qualifications, skills, and experience that the Board has identified as important to be reflected on the Board. The Nominating and Corporate Governance Committee also evaluates the collective contribution of qualifications, skills, and experience of Board nominees. The goal of that evaluation is to ensure that the Board, as a whole, possesses the necessary qualifications, skills, and experience relevant to the Company for effective oversight.

 

Although the Nominating and Corporate Governance Committee does not have a specific policy governing diversity, it considers, in identifying nominees for director, a nominee’s professional experience, education, qualifications, and skills with a view towards having a diversity of viewpoints in the broadest sense being represented on the Board. These considerations include, without limitation, the individual’s interest in United, independence, integrity, reputation, business experience, education, accounting and financial expertise, age, race, ethnicity, gender, civic and community relationships and knowledge and experience in matters impacting financial institutions.

 

With respect to incumbent directors considered for re-election, the Nominating and Corporate Governance Committee also assesses each director’s performance, contribution, level of engagement, and meeting attendance record. In addition, the Nominating and Corporate Governance Committee determines whether nominees are in a position to devote an adequate amount of time to the effective performance of director duties.

  

3

 

Board Qualifications and Experience

 

Our Board has identified that directors should posses the following core attributes:

 

Character and Integrity:   Record of Achievement:   Relevant Professional
or Business Experience:
  Cooperative Approach:
             
Must be an individual who exhibits integrity and informed judgment   Commitment to excellence, demonstrated by professional achievements and leadership experience   Understands the Company’s business or other related industries   Ability to work constructively in a collegial manner and willingness and ability to candidly consult with and advise management

 

Additional Qualifications and Experience Important to Our Business and Strategy

 

The Nominating and Corporate Governance Committee and our Board desire that our Board as a whole possess a balance of qualifications and experience that are relevant to our business and strategy. In addition to the threshold qualifications required for Board service, the following are additional qualifications and experience that the Nominating and Corporate Governance Committee and Board has identified as desirable on our Board.

 

  Executive Management
“C-Suite” experience; leadership experience as a division president or functional leader within a complex organization
Human Resources/Compensation
Experience managing a human resources function; experience with executive compensation and broad-based incentive planning
 
  Strategic Planning/Oversight
Experience developing and implementing operating plans and business strategy
Technology/Cybersecurity
Experience implementing technology strategies and innovation and managing and mitigating cybersecurity risks
 
  Financial/Accounting
Meets qualified Securities and Exchange Commission (“SEC”) financial expert definition and possesses significant financial expertise with knowledge of financial reporting and experience with financial disclosure requirements and internal controls
Banking Industry Experience
Experience in the banking and/or financial services industry
 
  Corporate Finance/Capital Management
Experience with corporate finance, capital allocation, and debt and capital market transactions
Retail Industry and/or Marketing
Experience

Experience with retail industry, transformation to digital platforms, branding major corporations, use of digital marketing strategies
 
  Risk Management
Experience overseeing complex risk management matters
Mergers and Acquisitions
Leadership experience with M&A transactions
 
  Regulatory/Political
Experience with governmental relations, regulatory environment, and/or working with regulators; experience as a politician or lobbyist
Corporate Social Responsibility
Demonstrates understanding of issues related to corporate social responsibility, sustainability, and environmental stewardship; informed on emerging issues potentially affecting the reputation of the business
 
  Corporate Governance
Demonstrates understanding of current corporate governance standards and best practices in public companies
   

 

4

 

Board Qualifications and Experience Matrix

 

The following chart reflects areas of qualifications and experience that our Board views as important when evaluating director nominees, as well as Board tenure and diversity information. Additional information on the business experience and other qualifications of each of our director nominees is included under Director Nominees for Election. Each director also contributes other important experience, skills, viewpoints, and personal attributes to our Board that are not reflected in the chart below.

 

Knowledge, Skills and Experience 

Bazante Blalock

Clements 

Daniels 

Drummond Harton

Mann 

Richlovsky 

Shaver Wallis Wilkins

Executive Management 

“C-Suite” experience; leadership experience as a division president or functional leader within a complex organization 

x

x

x

x

x

x

x

x

x

x

x

Strategic Planning/Oversight 

Experience developing and implementing operating plans and business strategy 

x

x

x

x

x

x

x

x

x

x

x

Financial/Accounting 

Meets qualified SEC financial expert definition and possesses significant financial expertise with knowledge of financial reporting and experience with financial disclosure requirements and internal controls 

             

x

x

   

Corporate Finance/Capital Management 

Experience with corporate finance, capital allocation, and debt and capital market transactions 

 

x

     

 

x

x

   

Risk Management 

Experience overseeing complex risk management matters 

 

x

 

x

x

x

   

x

 

x

Regulatory/Political 

Experience with governmental relations, regulatory environment, and/or working with regulators; experience as a politician or lobbyist 

 

x

x

x

x

x

 

x

   

x

Corporate Governance 

Demonstrates understanding of current corporate governance standards and best practices in public companies 

 

x

x

x

x

x

 

x

x

 

x

Human Resources/Compensation 

Experience managing a human resources function; experience with executive compensation and broad-based incentive planning 

       

x

 

x

       

Technology/Cybersecurity 

Experience implementing technology strategies and innovation and managing and mitigating cybersecurity risks 

   

x

 

x

     

x

   

Banking Industry Experience 

Experience in the banking and/or financial services industry 

x

x

 

x

x

x

 

x

     

Retail Industry and/or Marketing Experience 

Experience with retail industry, transformation to digital platforms, branding major corporations, use of digital marketing strategies 

x

     

x

x

x

 

x

   

Mergers and Acquisitions 

Leadership experience with M&A transactions 

x

x

 

x

x

x

x

x

x

   

Corporate Social Responsibility 

Demonstrates understanding of issues related to corporate social responsibility, sustainability, and environmental stewardship; informed on emerging issues potentially affecting the reputation of the business

x

 

x

 

x

x

x

x

x

 

x

Tenure (Years) <1 21 1 6 3 6 3 9 5 22 5
Demographics
Race/Ethnicity
African American         x            
White/Caucasian x x x x   x x x x x x
Gender
Male   x x x x x   x x x x
Female x           x        
Location
Florida x                    
Georgia   x             x x  
North Carolina       x x   x        
South Carolina     x     x         x
Tennessee                      
Other               x      

 

5

 

Director Nominees for Election 

Below is information about each of our Board’s nominees, including their age, the year in which they first became a director of our Company, their business experience for at least the past five years, and other information that led to the conclusion by our Board that each nominee should serve as a director of our Company. There are no family relationships between any director, executive officer, or nominee for director of United.

 

Jennifer M. Bazante 

Age: 57 | Director since: 2021

 

Ms. Bazante has a depth of experience leading world-class marketing organizations. She brings extensive knowledge to our Board as a marketing executive, with insights into brand recognition, customer experience, and digital transformation. Ms. Bazante also contributes extensive knowledge in the areas of leadership, strategic planning, and project management which, together with her deep marketing expertise, is highly valuable to our Board.

 

Career Highlights  

 

Ms. Bazante joined Humana in 2014 and was named Chief Marketing Officer in 2019. Prior to Humana, Ms. Bazante held several roles with Visa, Inc., including Head of Merchant Marketing and Head of Global Brand and Product Marketing, as well as marketing roles with Visa International and Colgate-Palmolive Company.


 

Education  

 

Ms. Bazante receive her master’s in business administration from the Darla Moore School of Business at the University of South Carolina and a bachelor’s degree from Florida State University.

 

Robert H. Blalock 

Age: 74 | Director since: 2000 | Committees: Audit, Risk

 

Mr. Blalock’s extensive knowledge and business experience, as well as involvement in our banking communities, provide critical insight to our Board. His experience and leadership of a small business in the Clayton, Georgia community provides a much-needed perspective into a business community that is representative of a large portion of United’s service area. As a past member of the board of directors of First Clayton Bank and Trust, Mr. Blalock brings not only a rich history of banking leadership but a perspective of the bank acquisition process.

 


 

Career Highlights

 

Mr. Blalock served as Chief Executive Officer of Blalock Insurance Agency, Inc. in Clayton, Georgia, from 1974 to 2021. He served as an organizing director of First Clayton Bank and Trust when the bank was formed in 1988. He was a member of the board of directors and served on the Compensation and Audit Committees for First Clayton Bank and Trust, which was acquired by United in 1997, and was past Chairman of the board of directors. Mr. Blalock remains on the community bank board of United Community Bank — Clayton (the former First Clayton Bank and Trust).

 

Mr. Blalock served as an Infantry Officer in the United States Army. He served a tour of duty in Vietnam with the 101 Airborne Division. He was a member of the Rotary Club of Clayton board of directors from 1974 to 1991 and served as the club’s Vice President.

 

Education

 

Mr. Blalock is a graduate of University of Georgia.

  

6

 

James P. Clements 

Age: 58 | Director since: 2020 | Committees: Nominating and Corporate Governance, Talent and Compensation

 

Dr. Clements’ experience as President of two universities makes him uniquely skilled with deep knowledge regarding operation of a complex organization and consideration of different stakeholder groups. In addition to his leadership in higher education, Dr. Clements has extensive knowledge in the field of information technology. Dr. Clements brings extensive knowledge in the areas of leadership, strategic planning, project management, computer science, and information technology to the Board.

 

Career Highlights

 

Dr. Clements became Clemson University’s 15th president on December 31, 2013. Before he came to Clemson, Dr. Clements served as the president of West Virginia University for nearly five years. Prior to his service at West Virginia University, Dr. Clements served as provost and vice president for academic affairs, vice president for Economic Development & Community Outreach and the Robert W. Deutsch Distinguished Professor of Information Technology at Towson University, the second largest university in the University System of Maryland.

 

 


 

Dr. Clements is a nationally recognized leader in higher education. He is a member of the Board of the American Council on Education, where he also served as chair of the ACE Commission on Leadership. In addition, he served on the executive committee of the APLU’s Commission on Innovation, Competitiveness and Economic Prosperity.

 

Dr. Clements was the only university president selected for the 15-member Innovation Advisory Board to the U.S. Department of Commerce. He also served as the co-chair of the National Advisory Committee for Innovation and Entrepreneurship 2.0, again serving as the only university president. He was nominated for, and participated in, the 81st Joint Civilian Orientation Conference through the U.S. Department of Defense where he was one of only a few dozen people selected in the country. Dr. Clements serves on the Executive Committee for the Council on Competitiveness and on the Executive Committee of the Board for the Business Higher Education Forum.

 

Dr. Clements has published and presented more than 75 papers in the fields of higher education, leadership, strategic planning, project management, computer science and information technology. He also served as principal investigator or co-investigator on more than $15 million in research grants.

 

Education

 

Dr. Clements holds a Bachelor of Science degree in computer science as well as a master’s degree and Ph.D. in operations analysis from the University of Maryland-Baltimore County. Dr. Clements also holds an M.S. degree in computer science from Johns Hopkins University’s Whiting School of Engineering and was awarded an honorary degree as doctor of public education from his alma mater, UMBC.

 

Kenneth L. Daniels 

Age: 70 | Director since: 2015 | Committees: Audit, Risk (Chair), Talent and Compensation, Executive

 

Mr. Daniel’s 38 years as a banking leader and risk professional with extensive experience in loan portfolio management, regulatory requirements, policy development and data integrity provides the Board of Directors with a depth of banking and risk expertise and offers the perspective of a large regional banking institution to the Board.

 

Career Highlights

 

Mr. Daniels began his career at First Union National Bank (now Wells Fargo) where he served as a Senior Commercial Loan Officer and Commercial Financial Analyst. In 1983, he joined BB&T and led various credit and risk management functions as the company grew from $2 billion to $187 billion in assets. In 2003, he was promoted to Chief Credit Risk and Policy Officer and later to Senior Risk Advisor, a position he held until his retirement in 2014.

 

 


 

Mr. Daniels is past President and Chair of both the Carolinas/Virginia Chapter and the Eastern North Carolina Chapter of the Risk Management Association (“RMA”). During his career, he served on the RMA’s National Agricultural Lending Council, the National Credit Risk Council, the Allowance for Loan and Lease Losses Roundtable and the Commercial Risk Grading Roundtable.

 

Education

 

Mr. Daniels graduated from the RMA/Wharton Advanced Risk Management Program at The Wharton School of Business and also earned an M.B.A. degree at East Carolina University and a bachelor’s degree at the University of North Carolina, Chapel Hill.

  

7

 

Lance F. Drummond 

Age: 67 | Director since: 2018 | Committees: Nominating and Corporate Governance (Chair), Risk, Talent and Compensation, Executive

 

Mr. Drummond brings to the Board of Directors 40 years of business experience as an executive level business leader with multi-industry and international experience. He specializes in business transforming strategy development and execution and organizational change for business-to-business and business-to-consumer Fortune 500 companies, with demonstrated success in manufacturing, technology and financial services industries.

 


Career Highlights

 

Mr. Drummond began his career in 1976 at Eastman Kodak, where he held several senior management positions including Divisional Vice President and General Manager Dental Products, Divisional Vice President and Regional General Manager Professional Products — Latin American region, Corporate Vice President and Chief Operating Officer Professional Products Division. In 2002, Mr. Drummond joined Bank of America as the Service and Fulfillment Operations executive for Global Technology and Operations. In this role, he led more than 19,000 associates who provided end-to-end operations support to 55 million consumer households, 2 million small business relationships, 200,000 commercial clients, 6,100 banking centers and 18,000 ATMs. In 2007, Mr. Drummond became Bank of America’s Global Consumer and Small Business Banking eCommerce/ATM executive. From 2009 to 2011, Mr. Drummond served as the Executive Vice President of Human Resources and Shared Services at Fiserv, Inc. In this role, he led the human resources function for Fiserv’s 20,000 employees. Additionally, he oversaw many of the company’s shared services, including Fiserv Global Services’ 2,800 employees, located in India and Costa Rica. In 2011, Mr. Drummond accepted the position of Executive Vice President of Operations and Technology at TD Canada Trust and served in this capacity until he retired in January 2015. In his role at TD Canada Trust, he led a team of associates who delivered personal and small business loan underwriting, funding, discharges, deposit operations, fraud management, collections, digitization and image transformation, service quality (Lean Six Sigma) and project management office services for Canadian Banking including retail, business and wealth.

 

Mr. Drummond is an independent director on the board of directors of the Federal Home Loan Mortgage Corporation (commonly referred to as “Freddie Mac”) where he serves on the Audit Committee and Nominations and Governance Committee and is chair of the Technology Working Group. He is a member of the Public Board of Governors of the Financial Industry Regulatory Authority (FINRA). He is also board member of CurAegis Technologies Inc., where he serves on the Audit Committee, and a board member of AvidXchange, Inc., a publicly traded company that provides accounts payable automation software.

 

Mr. Drummond received the MIT Sloan Fellowship in 1994 and the Aspen Institute’s Henry Crown Fellowship in 1998. Mr. Drummond is the founder of Dreamseeds — a children’s performing arts program at YMCA of Greater Rochester. He was recipient of the Rochester Area Community Foundation Award in 2000 and Rochester Mayor Unsung Heroes Award in 2001. He also received the University of Rochester Simon Business School Distinguished Alumnus Award in 2005 and Charlotte American Diabetes Association Father of the Year in 2005.

 

Education

 

Mr. Drummond earned his bachelor’s degree in Business Management from Boston University, MBA from the Simon Business School at the University of Rochester, and MS degree in Management Science from MIT.

 

H. Lynn Harton 

Age: 60 | Director since: 2015 | Committees: Executive (Chair)

 

With more than 30 years of experience in the banking industry, Mr. Harton has extensive experience with respect to lending, risk management, credit administration and virtually all other aspects of United’s business.

 

Career Highlights

 

Mr. Harton serves as Chairman of the Board, President and Chief Executive Officer of United and as Chairman of the Board and Chief Executive Officer of the Bank. Mr. Harton joined United in 2012 as Chief Operating Officer. In 2015, he was named President and elected to the Board of both United and the Bank. Mr. Harton was named Chief Executive Officer of the Bank in 2017 and was named Chief Executive Officer of United in 2018. Mr. Harton was named Chairman of the Board of both United and the Bank in 2019. Mr. Harton served as President of the Bank until 2021.

 

 


 

Prior to joining United, Mr. Harton served as the Executive Vice President and Head of Commercial Banking-South of Toronto-Dominion Bank (“TD Bank”) from 2010 to 2012. From 2009 to 2010, Mr. Harton served as President and Chief Executive Officer of The South Financial Group (“TSFG”), and from 2007 to 2009 he served as TSFG’s Chief Risk and Chief Credit Officer. During his time at TSFG, Mr. Harton raised capital to support TSFG during the financial crisis, negotiated the sale of the company to TD Bank, and, post-sale, led the successful integration of TSFG into TD Bank. Prior to joining TSFG, Mr. Harton served from 2003 to 2007 as the Chief Credit Officer of Regions Financial Corporation and Union Planters Corporation. He also had previously held various executive positions at BB&T from 1983 to 2003.

 

Mr. Harton is a past member of both the RMA National Community Bank Council and the RMA Board of Directors. He also has served on a number of additional financial boards and committees throughout his career, including the Palmetto Business Forum, RMA National Credit Risk Council, CBA National Small Business Banking Committee, and the Equifax Small Business Financial Exchange.

 

Education

 

Mr. Harton earned his bachelor’s degree from Wake Forest University and has participated in various executive programs at Duke University, Wharton, Columbia, Northwestern, University of North Carolina and University of South Carolina.

  

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Jennifer K. Mann 

Age: 51 | Director since: 2018 | Committees: Talent and Compensation (Chair), Executive

 

Ms. Mann provides a wealth of human resources experience to the Board of Directors. Her leadership in human resources demonstrates her vision and strong management skills and offers extensive human resources insight to the Board.

 

Career Highlights

 

Ms. Mann has been employed with SAS since 1998 and currently serves as Executive Vice President of Human Resources, where she is responsible for developing and guiding SAS’ human resources vision and articulating the organization’s strategy to help acquire, develop, reward and retain the best talent. Ms. Mann leads a global human resources organization that acts as a steward of the SAS culture and engages a global workforce of over 13,000 with diverse talents and skills. SAS has been ranked on the FORTUNE 100 Best Companies to Work For® list since the list’s inception. This recognition includes multiple number one rankings in the US, as well as the World’s Best Multinational Workplaces from Great Place to Work®, garnering accolades for SAS across the globe for its workplace culture and commitment to innovation. Her workplace culture insights have been shared in The Wall Street Journal, US World News and Report, CBS MoneyWatch.com, CBS Sunday Morning, CNN and The GREAT Workplace by Michael Burchell and Jennifer Robin. Ms. Mann was selected as a 2014 finalist for Chief Human Resources Officer of the Year by HRO Magazine. Prior to joining SAS, Ms. Mann held human resources leadership roles in industries such as high-tech manufacturing, healthcare and academia.

 

 


 

Ms. Mann serves on the advisory council at North Carolina State University’s Poole College of Management, as well as the board of directors for the North Carolina Marbles Kids Museum.

 

Education

 

Ms. Mann received her bachelor’s degree in Psychology and Business from Meredith College in Raleigh, North Carolina.

 

Thomas A. Richlovsky 

Age: 70 | Director since: 2012 | Lead Director | Committees: Audit, Nominating and Corporate Governance, Risk, Executive

 

Mr. Richlovsky has extensive experience in the financial services industry, having served in senior executive positions in finance, accounting and treasury at major banking organizations. Mr. Richlovsky’s expertise and experience in these finance-related areas of banking provide a valuable perspective making him well suited to serve on United’s Board of Directors.

 

Career Highlights

 

Richlovsky retired as Executive Vice President at PNC Financial Services Group Inc. (“PNC”) in 2011. He joined PNC upon its acquisition of National City Corporation in December 2008. Mr. Richlovsky was Chief Financial Officer, Treasurer and Principal Accounting Officer of National City at the time of its acquisition by PNC. During his 30-year tenure with National City, he assumed progressively greater responsibilities and gained extensive financial management, accounting and treasury expertise. Over that same period National City grew from approximately $5 billion in assets and 2,000 employees to $150 billion in assets and over 30,000 employees. Following the sale of National City to PNC, Mr. Richlovsky was appointed Executive Vice President of PNC and assisted in the integration of the two companies as well as managing several functional areas within the PNC finance group.

 

 


 

Mr. Richlovsky began his business career as an auditor in 1973 with Ernst & Ernst, a predecessor firm of Ernst & Young LLP, in Cleveland, Ohio.

 

During Mr. Richlovsky’s business career he was active in numerous professional organizations, including the American Institute of Certified Public Accountants, Financial Executives Institute, Bank Administration Institute and National Investor Relations Institute. He currently serves on the boards of several educational and charitable organizations.

 

Education

 

Mr. Richlovsky has a bachelor’s degree from Cleveland State University and is a certified public accountant. He also completed graduate studies at The Stonier Graduate School of Banking at Rutgers University.

  

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David C. Shaver

Age: 72 | Director since: 2016 | Committees: Audit (Chair), Talent and Compensation, Executive

 

Mr. Shaver has extensive accounting and finance experience, having served in senior executive positions in finance, accounting and taxes at major organizations including operating an advisory and accounting practices firm. Mr. Shaver qualifies as a financial expert on the Audit Committee.

 

Career Highlights

 

Mr. Shaver is the founder and Chief Executive Officer of Cost Segregation Advisors, LLC, a national income tax advisory services company which was formed in Atlanta in 2006 and provides

services to commercial real estate owners and leaseholders. Mr. Shaver was previously an initial partner with Tatum CFO Partners, now a division of Randstad and was also Chief Financial Officer and an equity partner of International Automotive Corp. Inc. Mr. Shaver also served as the Corporate Controller of The Home Depot, Inc., where he directed financial planning and operations, tax administration and reporting, inventory accounting and control, financial reporting and compliance, and other financial matters. Prior to his experience with The Home Depot, Inc., Mr. Shaver served as Controller for a W.R Grace Retail Group subsidiary and as Controller for Anomalous, Inc., an international subsidiary of Levi Strauss & Co. Mr. Shaver began his professional career in Atlanta, Georgia in 1972 as an auditor with Lybrand, Ross Bros. & Montgomery, a predecessor firm of PwC.

 

 


 

Mr. Shaver is active in his community as well and, for two years, devoted himself to forensic accounting and crisis management for his church in the office of the finance manager.

 

Mr. Shaver is a certified public accountant licensed in Georgia and Tennessee and is a member of The American Institute of CPAs, Georgia Society of CPAs, and Tennessee Society of CPAs.

 

Education

 

Mr. Shaver received his bachelor’s degree from the University of Tennessee.

 

Tim R. Wallis

Age: 70 | Director since: 1999 | Committees: Audit

 

Mr. Wallis has been a community leader and long-term owner of a small business. With United’s interest in small business and commercial banking, Mr. Wallis brings a valuable perspective and insight to the Board of Directors. His varied experience in a number of community boards, as well as his service on the United Community Bank — Rome community bank board, gives the Board of Directors a focus on the needs of our mid-size banking communities and the business owners within those communities.

 

Career Highlights

 

Mr. Wallis has been President of Wallis Printing in Rome, Georgia since 1985 and has been with the company since 1974. In addition to serving on the Board of Directors of United, Mr. Wallis also serves as Chairman on the community bank board of United Community Bank — Rome. He has served on the board of directors of the Printing and Imaging Association of Georgia (“PIAG”) and was Chairman of the association’s Government Relations Committee. In this capacity he worked directly with PIAG legislative liaisons at both the state and national levels. Mr. Wallis currently serves on the Georgia Chamber of Commerce board of directors and is on the board of governors where he is the chair for northwest Georgia. Additionally, Mr. Wallis has significant investment interests in retail shopping centers and apartment complexes throughout the Southeast. He also has served on the Darlington School Board of Trustees, Georgia Southern University Foundation Board of Trustees, Rome/Floyd YMCA Board of Trustees and the United Way of Rome and Floyd County Board of Trustees.

 

 


 

Education

 

Mr. Wallis is a graduate of Georgia Southern University.

  

10

 

David H. Wilkins 

Age: 75 | Director since: 2016 | Committees: Risk *

 

Mr. Wilkins has extensive legal, regulatory and governance experience, having served in a senior position in a national law firm and as a U.S. Ambassador and Member of a State House of Representatives. Mr. Wilkins’ legal and governance experience provides a valuable perspective to United’s Board of Directors.

 

Career Highlights

 

Ambassador Wilkins is a partner at Nelson Mullins Riley & Scarborough LLP in Greenville, South Carolina and chairs the Public Policy and International Law practice group with a special focus on U.S. — Canada interests. He proudly served as U.S. Ambassador to Canada from June 2005 to January 2009, appointed by President George W. Bush.

 

 


 

Since returning to South Carolina from Canada, Ambassador Wilkins spent six years chairing the Clemson University Board of Trustees and now serves as a Trustee Emeritus to that board. Additionally, he has served as a director on several corporate boards over the past ten years. He is a member of both the South Carolina Bar Association and the American Bar Association. In 2010, then South Carolina’s Governor-elect Nikki Haley tapped Mr. Wilkins to chair her government transition team. First elected in 1980, Ambassador Wilkins served 25 years in the South Carolina House of Representatives. He was elected speaker in 1994 — a position he held for 11 years until he resigned for his ambassadorship post. He is the recipient of numerous awards including the state’s highest honor, the Order of the Palmetto.

 

Education

 

Mr. Wilkins received his bachelor’s degree from Clemson University and his J.D. degree from University of South Carolina School of Law.

 

* Mr. Wilkins served on the Nominating and Corporate Governance Committee until February 2022.

 

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Process for Shareholder to Recommend Individuals for Consideration by the
Nominating and Corporate Governance Committee

 

Any shareholder who wishes to recommend a director candidate for consideration by our Nominating and Corporate Governance Committee must submit a written notice to our Corporate Secretary. For the 2023 Annual Meeting of Shareholders, the Nominating and Corporate Governance Committee will consider recommendations received by December 7, 2022. The written notice must set forth:

 

The name and business or residence address of the nominee;

The number of shares of common stock of United that are beneficially owned by the nominee;

The total number of shares that, to the knowledge of the nominating shareholder, would be voted for such person;

The signed consent of the nominee to serve, if elected; and

The name and residence address of the nominating shareholder, and the number of shares of United that are beneficially owned by the nominating shareholder.

 

Written notices should be sent to the Corporate Secretary, United Community Banks, Inc., 2 West Washington Street, Suite 700, Greenville, South Carolina, 29601. There were no director nominations proposed for the 2022 Annual Meeting by any shareholder.

 

 

 

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE

“FOR ALL” OF THE 11 DIRECTOR NOMINEES NAMED IN PROPOSAL 1.

 

 
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Corporate Governance

 

Our Board of Directors

 

Our Board provides active, engaged, independent oversight of the Company. All members of the Board are well engaged in their responsibilities. The Board places a high value on collegiality and open dialogue. The Board proactively fosters a culture of transparency and respect for others. At Board meetings, the Lead Director and other Board members regularly articulate the desire for all members of the Board to express their views and to be open to the opinions of others. We believe that the Board’s commitment to this positive culture is the core attribute that facilitates the Board’s effective independent oversight of the Company.

 

 

Our Board is guided by strong governance principles and practices, including the following:

 

•     Lead independent director with clearly defined role

•     100% independent directors serving on Nominating and Corporate Governance Committee, Talent and Compensation Committee, Audit Committee, and Risk Committee 

•     Executive sessions of independent directors at each regular Board meeting 

•     Continuous consideration of Board and committee composition and refreshment 

•     Annual comprehensive Board and committee self-assessments 

•     Direct Board access to management and transparency and openness in communications 

•     Stock ownership requirements for directors 

•     Strict anti-hedging policy

 

 

Among other important functions, our Board and its committees:

 

Oversee management’s development and implementation of a multi-year strategic business plan and annual operating plan and monitor our progress in meeting these plans

Oversee our risk management processes and efforts to identify, assess, and manage or mitigate material risks facing United, including operational, cyber, credit, market, liquidity, compliance, and reputational risks

Oversee our audit function, our independent registered public accounting firm, and the integrity of our financial statements

Review, monitor, and approve succession plans for our Chief Executive Officer (“CEO”) and other key executives to promote senior management continuity

Oversee the establishment and administration of appropriately designed compensation programs and plans

Review our CEO’s performance and approve the total annual compensation for our CEO and other executive officers

Oversee the Company’s maintenance of high ethical standards, including by adoption of a code of ethical conduct that applies to our executive management and the Board

Review our environmental, social, and governance (“ESG”) initiatives, including our human capital management policies and practices
 
13

Director Independence

 

NASDAQ listing standards require that a majority of our directors be independent and that each member of our Audit Committee, Nominating and Corporate Governance Committee and Talent and Compensation Committee be independent. Our Board determines the independence of each director and director nominee in accordance with guidelines it has adopted, which include all elements of independence set forth in the NASDAQ listing standards and SEC rules. The Board first considers whether any director or nominee has a relationship covered by the NASDAQ listing standards that would prohibit an independence finding for Board or committee purposes. Any director who has a material relationship with United or its management is not considered to be independent.

 

Our Board has affirmatively determined that all of our director nominees are independent, except for our CEO, H. Lynn Harton, due to his employment with the Company. Specifically, the Board determined that 10 of 11 of our director nominees are independent under NASDAQ listing standards and our guidelines: Ms. Bazante, Mr. Blalock, Dr. Clements, Mr. Daniels, Mr. Drummond, Ms. Mann, Mr. Richlovsky, Mr. Shaver, Mr. Wallis, and Mr. Wilkins. Our Board made a determination as to each independent director that no relationship exists which, in the opinion of the Board, would interfere with the exercise of the director’s independent judgment in carrying out his or her responsibilities as a director. The Board also determined that each person who currently serves or who served in 2021 on the Audit Committee, the Talent and Compensation Committee and the Nominating and Corporate Governance Committee meets or met, as applicable, the NASDAQ independence requirements for membership on those committees and, as to the Audit Committee, SEC rules.

 

In reaching the determination that Mr. Wilkins is independent, the Board considered that during 2021, United paid approximately $1.1 million to the law firm Nelson Mullins Riley & Scarborough (“NMRS”) for various legal services. Mr. Wilkins is a partner in NMRS. The Audit Committee and Board were aware of this relationship when NMRS was approved to perform legal work for the Company. The fees paid to NMRS amount to less than two-tenths of 1% of that firm’s total revenue and did not exceed established thresholds that are incompatible with Mr. Wilkins being considered independent, as set under the rules of NASDAQ and applicable provisions of the Securities Exchange Act of 1934 (the “Exchange Act”) Mr. Wilkins performed no legal work for the Company and received no compensation related to the engagement.

 

Board Leadership Structure

 

Our Board periodically reviews its leadership structure. The Board maintains flexibility to determine the most effective leadership structure in light of the composition of the Board, the composition of management, and the needs of the Company as they change over time. We currently have a Chairman and an independent Lead Director. Mr. Harton, our CEO, serves as Chairman, and Mr. Richlovsky serves as Lead Director. The Lead Director is appointed by the Board upon the recommendation of the Nominating and Corporate Governance Committee.

 

Our Board believes that the existing structure, with Mr. Harton as Chairman and Mr. Richlovsky as Lead Director, continues to be the most effective leadership structure at this time. The Company benefits from an executive Chairman with deep experience in the financial services industry and knowledge of the Company’s emerging risks and issues that flows from close coordination with the management team. The combined CEO and Chairman role allows the Company to communicate its strategy to employees, customers, regulators, shareholders, and other stakeholders in a single voice. The Company likewise benefits from a Lead Director with deep experience in the financial services industry who communicates regularly with the Chairman, other members of the Company’s management team, and the other independent directors. We believe that the joint efforts and coordination between our Chairman and Lead Director exemplifies effective Board leadership and fulfillment of the Board’s oversight responsibilities.

 

Our Lead Director is highly engaged with management and the other independent directors. Our Lead Director:

 

Regularly meets with our CEO

Coordinates with the CEO and committee chairs to develop Board and committee meeting agendas

Regularly speaks with each of the committee chairs

Attends all committee meetings

Advises the CEO of the information needs of the Board and provides feedback from the Board

Serves as a “sounding board” for the CEO

Develops topics of discussion for executive sessions of our Board

Leads the executive sessions of our Board

Coordinates with the CEO and Chair of the Nominating and Corporate Governance Committee to develop the Board’s annual self-evaluations
 
14

Board Evaluation

 

The Board and each Board committee continuously evaluate their own effectiveness throughout the year. The Lead Director, the committee chairs, and the CEO/Chairman regularly discuss the Board and Board committee areas of responsibility and processes, as well as general governance principles, to seek ways in which to enhance the Board’s effectiveness and efficiency.

 

In addition, the Board and each committee annually perform self-evaluations using a process approved by the Nominating and Corporate Governance Committee. In addition, directors are asked to provide candid feedback on individual members of the Board to the Chair of the Nominating and Corporate Governance Committee, the Chairman of the Board or the Lead Director, who then meet to discuss individual director performance and succession considerations.

 

The Board retains an outside consultant to facilitate the annual self-evaluation process. In connection with the annual self-evaluation process, Board members complete a questionnaire. Among other topics, the 2021 self-evaluation questionnaire covered these key areas:

 

Board meetings and information provided

Board meeting topics

Alignment of Board and management

Communication between Board and management

Board composition, skills, and expertise

Board development

Board committees and effectiveness

Board self-evaluation process

 

The Board reviewed and discussed the results of the self-evaluation process as part of the annual self-evaluation.

 

CEO and Key Management Succession Planning

 

Our Board oversees our long-term management development and succession. Management maintains procedures that would be implemented upon the sudden departure of our Chief Executive Officer or other key members of our executive team.

The management development and succession program focuses on key positions and succession elements, including identification of potential successors for positions when it is determined that internal succession is appropriate, assessment of each potential successor’s level of readiness, and preparation of individual growth and development plans. The succession plans are reviewed by the Board at least annually.

 

Board Committees

 

Our Board has established 5 standing committees: Audit, Talent and Compensation, Nominating and Corporate Governance, Risk, and Executive. Our Board Committees act on behalf of the Board and report their activities to the Board at regular Board meetings. The Board appoints the members of each committee based on the recommendation of the Nominating and Corporate Governance Committee.

 

At least annually, the Board and the Nominating and Corporate Governance Committee review the committee member assignments and chair positions and considers committee changes, refreshment, and chair rotations. Three of our committees have new Chairs since 2019. The Board and Nominating and Corporate Governance Committee also review the director qualifications and experience matrix to assist them in evaluating the experience of directors on each committee. The director qualifications and experience matrix can be found under Board Qualifications and Experience: Board Qualifications and Experience Matrix.

 
15

 

The following table identifies the current members and chairs of each of our standing committees.

 

 

Audit Committee

Executive
Committee

Nominating
and Corporate
Governance
Committee

Risk Committee

Talent and
Compensation
Committee

Jennifer M. Bazante + l          
Robert H. Blalock I M     M  
James P. Clements I     M   M
Kenneth L. Daniels I M M   C M
Lance F. Drummond I   M C M M
H. Lynn Harton *     C      
Jennifer K. Mann I   M     C
Thomas A. Richlovsky I M M M M  
David C. Shaver I C M     M
Tim R. Wallis I M        
Amb. David H. Wilkins I       M  

 

I = Independent director C = Chairperson M = Member * = Chairman of the Board • = Lead Director

 

+ Ms. Bazante was appointed to the Board in September 2021. Generally, during a director’s first year of service, the director is invited to participate in committee meetings as a guest as part of new director orientation. A director is typically appointed to one or more Board committees after becoming familiar with the Board committees, structure, and processes.

 

 

The Board has adopted a charter for each standing Board committee, which are available on the Investor Relations > Corporate Governance section of our website (www.ucbi.com). Each committee charter addresses the purpose, authority, and responsibilities of the committee, as well as membership and meetings. As required by each committee charter, each committee annually reviews and assesses its charter’s adequacy and the committee’s performance. Committees may recommend amendments to their respective charters, and our Board must approve amendments.

 

The members, number of meetings held in 2021, and key responsibilities of each of our standing committees are described below:

 

 

Audit

Membership: Mr. Blalock, Mr. Daniels, Mr. Richlovsky, Mr. Shaver (Chair), Mr. Wallis

 

2021 Meetings: 9

 

Key Responsibilities:

 

•     Selects the independent auditor 

•     Annually evaluates the independent auditor’s qualifications, performance, and independence, as well as the lead audit partner; discusses the nature, scope and rigor of the audit process; and reviews the annual report on the independent auditor’s internal quality control procedures and any material issues raised by its most recent review of internal quality controls 

•     Discusses the annual audited and quarterly unaudited financial statements with management and the independent auditor 

•     Reviews with management and auditors the quality and adequacy of our internal control over financial reporting, and establishes procedures for receipt, retention and treatment of complaints regarding accounting or internal controls 

•     Oversees, reviews and approves internal audit activities, projects, and budget 

•     Oversees the effectiveness of our compliance and ethics programs

 
 
16

 

 

Executive 

Membership: Mr. Daniels, Mr. Drummond, Mr. Harton (Chair), Ms. Mann, Mr. Richlovsky, Mr. Shaver

 

2021 Meetings: 3

 

Key Responsibilities: 

•     Subject to certain limitations, has the responsibility to exercise, during the intervals between meetings of the Board, any and all of the powers and authority of the Board in United’s management and affairs 

•     From time to time, our CEO or executive team consult the Executive Committee regarding strategic or other matters where input of Board members may be valuable outside of regularly scheduled Board meetings 

 

 

Nominating and Corporate Governance 

Membership: Dr. Clements, Mr. Drummond (Chair), Mr. Richlovsky *

 

2021 Meetings: 5

 

Key responsibilities: 

•     Reviews and recommends, as appropriate, changes to the size, composition and operation of the Board and its committees 

•     Develops and recommends criteria for selecting new directors 

•     Identifies, screens and recommends to our Board individuals qualified to serve on our Board 

•     Recommends Board committee structure and membership, including the recommendation of a Lead Director 

•     Assists the Board with succession planning 

•     Develops, recommends and annually assesses corporate governance policies, practices and guidelines and makes recommendations for changes to the Board 

•     Monitors the Company’s strategies in light of corporate stewardship and environmental, social, and governance principles 

•     Oversees the process governing annual Board, committee and director evaluations 

* Mr. Wilkins served on the Nominating and Corporate Governance Committee until February 2022.

 

 

Risk 

Membership: Mr. Blalock, Mr. Daniels (Chair), Mr. Drummond, Mr. Richlovsky. Mr. Wilkins

 

2021 Meetings: 4

 

Key responsibilities: 

•     Assists the Board in its general oversight of the Company’s risk management processes

•     Responsible for an integrated effort to identify, assess and manage or mitigate material risks facing the Company

•     Monitors and reviews United’s enterprise risk management processes, strategies, policies and practices to identify emerging risks

•     Evaluates the adequacy of United’s risk management functions 

•     Makes recommendations to management and the Board in order to effectively manage risks

 

 

Talent and Compensation 

Membership: Mr. Daniels, Dr. Clements, Mr. Drummond, Ms. Mann (Chair), Mr. Shaver

 

2021 Meetings: 5

 

Key Responsibilities: 

•     Reviews and approves corporate goals and objectives relevant to compensation of the Company’s executive officers 

•     Determines executive officer compensation and recommends director compensation for Board approval

•     Oversees overall compensation philosophy and principles

•     Establishes short-term and long-term incentive compensation programs for executive officers and approves all equity awards

•     Oversees share ownership guidelines and holding requirements for Board members and executive officers

•     Oversees the performance evaluation process for executive officers

•     Selects and determines fees and scope of work of its compensation consultant 

•     Oversees and evaluates the independence of its compensation consultant and other advisors

 

 
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Board and Committee Meeting Attendance

 

Directors are expected to attend our annual meeting of shareholders, Board meetings, and meetings of Board committees on which they serve. Attendance may be by telephone or video conference. During 2021, our Board met five times. The Company’s independent directors meet in executive session in conjunction with each regular Board meeting. Mr. Richlovsky, as Lead Director, presides over all executive sessions of the independent directors.

 

During 2021, each of our incumbent directors attended at least 75% of the aggregate meetings of our Board and the committees on which they served during 2021. In addition, each of our directors serving at the time attended our 2021 Annual Meeting of Shareholders.

 

In addition to our regular meetings of the Board and Board Committees, directors attend a Board retreat annually. The Board retreat includes outside speakers who present on emerging topics relevant to the Company and the banking industry and discussion of the Company’s strategic imperatives. All of our directors attended the 2021 Board retreat either in person or virtually.

 

Board Oversight of Risk

 

The Board oversees the Company’s risk management. The Company has developed a risk management structure to facilitate careful oversight of risk. The Board provides credible challenge and holds management accountable for maintaining an effective risk management program and for adhering to risk management expectations.

 

The Board (or the appropriate committee in the case of risks that are under the purview of a particular committee) receives and discusses reports prepared by United’s executive management, including the Chief Risk Officer, on areas of material risk to United. The Board uses these reports to enable it to understand the risk identification, risk management, and risk mitigation strategies being used by United and to ensure that the strategies are implemented appropriately.

 

To further support the risk management function, United also has a Risk Committee comprised solely of independent directors. The Risk Committee assists the Board in its general oversight of the Company’s risk management processes and is responsible for an integrated effort to identify, assess, and manage or mitigate material risks facing the Company. The Risk Committee’s primary functions include monitoring and reviewing United’s enterprise risk management processes, strategies, policies, and practices to identify emerging risks, evaluate the adequacy of United’s risk management functions, and make recommendations to management and the Board in order to effectively manage risks.

 

Audit Committee Financial Expert

 

Our Board has determined that each of Messrs. Richlovsky and Shaver is an “Audit Committee financial expert” as that term is defined in the regulations promulgated under the Exchange Act. Additionally, the Board has determined that all members of the Audit Committee are able to read and understand fundamental financial statements within the meaning of NASDAQ’s Audit Committee requirements.

 

Share Ownership Guidelines and Anti-Hedging Policy

 

The Board has adopted share ownership guidelines for directors and executive officers.

 

Each nonemployee director is expected to maintain a meaningful ownership of shares of the Company’s common stock, which the Company considers to be common stock having a value at least equal to three times the annual base cash retainer payable for service on the Company’s Board. Such ownership is expected to be acquired within five years of election to the Board. Each nonemployee director is expected to retain ownership of 100% of all net after-tax shares granted by the Company after such shares vest until the nonemployee director reaches the target.

 

Each employee at the level of Executive Vice President and above is expected to maintain a meaningful ownership of shares of the Company’s common stock, which the Company considers to be a number of shares of our common stock having a value at least equal to a multiple, as set forth below, of the officer’s annual base salary as in effect from time to time.

 

Officer Level Multiple of Base Salary
CEO 3X
Other Executive Officers 2X
 
18

Such ownership is expected to be acquired within five years of such person’s hire or promotion date. Each executive officer is expected to retain ownership of 100% of all net after-tax shares granted by the Company after such shares vest until the executive officer reaches the target.

 

Our insider trading policy prohibits Board members and employees (including our executive officers) from pledging United securities as collateral, holding United securities in a margin account, and hedging against any decrease in the market value of equity securities issued by United and held by them, such as entering into or trading prepaid variable forward contracts, equity swaps, collars, puts, calls, options, exchange funds or other derivative instruments related to United stock.

 

Code of Ethical Conduct

 

In addition to a Code of Ethics applicable to all of our employees, United has adopted a Code of Ethical Conduct designed to promote ethical conduct which applies to, among other members of our executive and senior management and Board, United’s Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer. United’s Code of Ethical Conduct is available on our website (www.ucbi.com) where we would also post any amendments or waivers to the Code of Ethical Conduct.

 

Communications with Board of Directors

 

Shareholders wishing to communicate with the Board should send any communication in writing to the Corporate Secretary, United Community Banks, Inc., 2 West Washington Street, Suite 700, Greenville, South Carolina, 29601. Any such communication must state the number of shares beneficially owned by the shareholder making the communication. The communication will be forwarded to the full Board or to any individual director or directors to whom the communication is directed unless the communication is determined to be illegal or otherwise inappropriate.

 

Corporate Governance Information

 

You can find information regarding our corporate governance practices on the Investor Relations > Corporate Governance section of our website (www.ucbi.com) including our Code of Ethics, Corporate Governance Guidelines, and the charter of each of our standing committees. This information is available in print to any shareholder who sends a written request to: Investor Relations, United Community Banks, Inc., 2 West Washington Street, Suite 700, Greenville, South Carolina, 29601.

 
19

 

Director Compensation

 

The following summarizes the compensation earned by or paid to each person who served as a nonemployee member of our Board of Directors during all or any part of 2021. Mr. Harton was not separately compensated for his service on the Board. See Executive Compensation for information regarding Mr. Harton’s employee compensation. Directors of the Company also serve on the Board of United Community Bank (the “Bank”) and receive no additional compensation related to their service on the Bank’s Board. In addition, we reimburse directors for certain fees and expenses incurred in connection with continuing education activities and for travel and expenses related to United business.

 

Name 

Fees Earned or

Paid in Cash ($)1

Stock Awards ($)2

All Other
Compensation ($)3

Total ($)

Jennifer M. Bazante4 $ 13,333 $ 37,515 $- $ 50,848
Robert H. Blalock 60,000 50,032 1,400 111,432
James P. Clements 45,500 50,032 - 95,532
L. Cathy Cox5 43,750 50,032 - 93,782
Kenneth L. Daniels 83,500 50,032 - 133,532
Lance F. Drummond 74,000 50,032 - 124,032
Jennifer K. Mann 58,500 50,032 - 108,532
Thomas A. Richlovsky 95,000 50,032 - 145,032
David C. Shaver 71,000 50,032 1,400 122,432
Tim R. Wallis 48,000 50,032 1,600 99,632
Amb. David H. Wilkins 50,000 50,032 - 100,032

 

1 The annual cash retainer fees may be deferred pursuant to United’s Deferred Compensation Plan. No director elected to defer his or her 2021 annual director cash compensation.

2 With the exception of Ms. Bazante, this represents the grant date fair value of time-based restricted stock units awarded on June 1, 2021 (1,441 underlying shares valued at $34.72 per share, the price of United’s common stock on that date) computed in accordance with FASB ASC Topic 718. Ms. Bazante’s award was prorated based on her appointment to the Board on September 1, 2021 and represents the grant date fair value of time-based restricted stock units awarded on September 1, 2021 (1,248 underlying shares valued at $30.06 per share, the price of United’s common stock on that date) computed in accordance with FASB ASC Topic 718. All director 2021 TRSU awards were outstanding as of December 31, 2021 with the exception of Ms. Cox’s awards which were forfeited in conjunction with her resignation from the Board effective October 1, 2021. See Note 16 of our annual consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022, for information regarding assumptions made in the valuation of these awards. These awards have a one-year vesting term.

3 Represents fees paid for service on one or more of our Bank Boards.

4 Ms. Bazante’s 2021 director compensation was prorated based on her appointment to the Board on September 1, 2021.

5 On October 1, 2021, Ms. Cox submitted her resignation from the Board. Ms. Cox resigned from the Board due to her appointment as President of Georgia College & State University, a unit of the University System of Georgia (“USG”). President Cox informed the Company that USG does not allow its presidents to serve on compensated outside boards. Her resignation was not the result of any disagreement with United.

 

 

Nonemployee directors received an annual cash retainer fee for their service on the Board as well as incremental annual cash retainer fees relative to committee duties and responsibilities. Cash retainer fees are paid quarterly. The following table summarizes 2021 components of annual director cash compensation.

 

 

Effective as of
1Q2021 Payment
($)

Director $ 40,000
Lead Director 25,000
Audit Committee Member 10,000
Audit Committee Chair 12,500
Risk Committee Member 10,000
Risk Committee Chair 12,500
Nominating and Corporate Governance Committee Member 5,000
Nominating and Corporate Governance Committee Chair 8,000
Talent and Compensation Committee Member 6,000
Talent and Compensation Committee Chair 10,000
Executive Committee Member 5,000
Executive Committee Chair

-1

 

1 Mr. Harton, our President and Chief Executive Officer, serves as the Executive Committee Chair. Mr. Harton also serves as Chairman of the Board. Mr. Harton is not separately compensated for his service on the Board.

 

 

The forms and amounts of director compensation outlined above were recommended by the Talent and Compensation Committee, and approved by the Board, after considering market data and recommendations of the Talent and Compensation Committee’s compensation consultant, which utilized the same peer group used in connection with establishing the compensation of our executive officers. In November 2021, the Talent and Compensation Committee recommended, and the Board approved effective January 1, 2022, an increase in the annual director cash retainer fee from $40,000 to $45,000 and an increase in the annual director equity retainer fee from $50,000 to $55,000 to maintain competitive positioning to market.

 
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Transactions with Management and Others

 

Policy with Respect to Approval of Related Party Transactions

 

United has a written related party transaction policy that governs the review, approval and ratification of any transaction that would be required to be disclosed by United pursuant to Item 404 of Regulation S-K under the Securities Act of 1933. United’s Board (or the Audit Committee of the Board) must approve all such transactions under the policy.

 

Prior to entering into such a related party transaction or an amendment thereof, the Board (or a committee of the Board) must consider all of the available relevant facts and circumstances including, if applicable, benefits to United, the impact of a transaction on a director’s independence, the availability of other sources for comparable products or services, the terms of the transaction and the terms available to or from unrelated third parties or employees generally, as the case may be. No member of the Board or any committee shall participate in any review, consideration or approval of any related party transaction with respect to which such member or any of his or her immediate family members is a related party.

 

2021 Related Party Transactions

 

There were no related party transactions in 2021 except as follows:

 

During 2021, United paid approximately $1.1 million to the law firm of NMRS for various legal services. Director Wilkins is a partner in NMRS. The Audit Committee and Board were aware of this relationship when they approved NMRS to perform legal work for the Company. The fees paid to NMRS amount to less than two-tenths of 1% of that firm’s total revenue and did not exceed established thresholds that are incompatible with being considered independent, as set under the rules of NASDAQ and applicable provisions of the Exchange Act. Mr. Wilkins performed no work for the Company in his role as partner of NMRS and received no compensation related to the engagement. The Board considered this relationship in determining that Mr. Wilkins was an independent member of the Board, Nominating and Corporate Governance Committee and Risk Committee for 2021, as contemplated by NASDAQ and applicable provisions of the Exchange Act.

 
21

 

Proposal 2: Approval of the 2022 Omnibus Equity Plan

 

On March 17, 2022, the Talent and Compensation Committee of our Board recommended, and our Board approved, the United Community Banks, Inc. 2022 Omnibus Equity Plan (the “2022 Plan”), subject to the approval of our shareholders. We are requesting that our shareholders vote in favor of a proposal to approve the 2022 Plan.

 

The purpose of the 2022 Plan is to give the Company a competitive advantage in attracting, retaining and motivating officers, employees, directors and/or consultants. We view the use of stock-based awards as an essential part of our compensation program and as an important element in achieving the program’s goals. These awards help align pay with performance and allow us to better link the financial interests of officers, employees, nonemployee directors and consultants with shareholders. Equity compensation is necessary to attract, motivate and retain our employees by providing compensation opportunities that are competitive with other companies.

 

If approved by our shareholders, the 2022 Plan will succeed the United Community Banks, Inc. 2000 Key Employee Stock Option Plan (as amended and restated from time to time, the “2000 Plan”). The Board and the Talent and Compensation Committee are mindful of their responsibility to shareholders in granting equity-based awards. The Company, through its Talent and Compensation Committee, believes that it has prudently managed awards under the 2000 Plan and has not requested shareholder approval for the issuance of additional shares pursuant to equity compensation plans since 2016. As of March 15, 2022, 489,148 shares of our common stock remained available for grant under our 2000 Plan and no additional grants will be made under the 2000 Plan after the date hereof. Our shareholders are being asked to approve the 2022 Plan to provide for the issuance of three (3) million shares under the 2022 Plan.

 

The Talent and Compensation Committee believes that adoption of the 2022 Plan is necessary to ensure that a sufficient number of shares will be available to fund our compensation programs for the next several years, taking into account potential future growth. We believe that the number of shares under the 2022 Plan would provide us with the opportunity to continue granting equity-based compensation at appropriate levels for approximately four years before we would need to seek shareholder approval of more shares.

 

No awards will be made under the 2022 Plan unless it is approved by our shareholders. If shareholder approval is not obtained, the 2022 Plan will have no effect and the shares available under the 2000 Plan will remain available for grant. If the 2022 Plan is approved, no additional awards will be granted under the 2000 Plan after the date of shareholder approval of the 2022 Plan. Grants previously made under the 2000 Plan will remain in effect according to their respective terms.

 

Highlights of the 2022 Plan

 

The 2022 Plan includes key provisions designed to protect shareholder interests, promote effective corporate governance and reflect sound corporate governance principles, including, but not limited to, the following:

 

The 2022 Plan is administered by an independent committee.

 

No repricing of stock options or stock appreciation rights (“SARs”) is permitted without prior shareholder approval.

 

Stock options and SARs cannot be granted with an exercise price that is less than 100% of fair market value on the date of grant.

 

There is no evergreen or automatic replenishment provision pursuant to which the shares authorized for issuance under the 2022 Plan are automatically replenished.

 

The 2022 Plan does not permit liberal share recycling.

 

Awards granted to executive officers under the 2022 Plan will provide that no dividends or dividend equivalents will be paid on unvested awards until those awards are earned and vested.

 

Awards are generally subject to a minimum one-year vesting period except as to 5% of the authorized shares, awards that are settled in cash and awards to nonemployee directors that vest based on the date of our annual meeting of shareholders.

 

Awards are subject to individual annual limits, including for nonemployee directors of the Company.

 

Consistent with the 2022 Plan, awards granted under the 2022 Plan are subject to forfeiture, cancellation and recoupment if an award holder engages in detrimental conduct, including interfering with our business.

 

Awards granted under the 2022 Plan are also subject to our clawback policy.

 

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The following is a summary of the key terms of the 2022 Plan. This summary is qualified in its entirety by reference to the complete text of the 2022 Plan, which is attached as Appendix 1 to this Proxy Statement. The closing price of a share of our common stock on the Nasdaq on March 15, 2022 was $37.32.

 

Description of the 2022 Plan

 

Administration

 

The 2022 Plan is administered by the Talent and Compensation Committee of the Board or such other committee consisting of two or more independent members as may be appointed by the Board to administer the 2022 Plan. The Committee may act only by a majority of its members then in office, except that the Talent and Compensation Committee may, except to the extent prohibited by applicable law or the listing standards of the applicable securities exchange, allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it. Any such allocation or delegation may be revoked by the Talent and Compensation Committee at any time. Any authority granted to the Talent and Compensation Committee may be exercised by the full Board. References to the Talent and Compensation Committee in this proposal include and, as appropriate, apply to any such subcommittee or individual to whom the Talent and Compensation Committee has delegated some of its authority under the 2022 Plan.

 

The Talent and Compensation Committee will determine the individuals to whom awards will be granted, the number of shares subject to an award and the other terms and conditions of an award.

 

The Talent and Compensation Committee may also provide in an award agreement relating to awards under the 2022 Plan for automatic accelerated vesting and other rights upon the occurrence of a “change in control” or upon the occurrence of other events as may be specified in such agreements. The Company’s current practice is for award agreements to provide for double-trigger vesting upon a change in control.

 

Amendment and Termination

 

The 2022 Plan will be effective until May 18, 2032 if approved by shareholders. Subject to the requirement that shareholder approval be obtained for certain types of amendments, the 2022 Plan may be amended or terminated by the Board, in whole or in part, but no such action may materially impair any rights or obligations with respect to any awards previously granted under the 2022 Plan.

 

Repricing Prohibited

 

The 2022 Plan prohibits the Company from reducing the exercise price of outstanding options or SARs, replacing or repurchasing any underwater or out-of-the-money options or SARs or taking any other action that would constitute repricing under generally accepted accounting principles or applicable Nasdaq listing rules without first receiving shareholder approval and except for adjustments pursuant to the adjustment provision noted below.

 

Shares Subject to the 2022 Plan

 

If the 2022 Plan is approved by shareholders, a total of three (3) million shares of common stock would be available for issuance under the 2022 Plan subject to certain adjustments set forth in the 2022 Plan. Shares available for issuance under the 2022 Plan will consist of authorized but unissued shares of common stock or shares of common stock held as treasury shares. The maximum number of incentive stock options that may be issued under the 2022 Plan is the same as the number of authorized shares.

 

Shares awarded or subject to delivery upon exercise of an option or SAR under the 2022 Plan and that are not delivered, including due to the satisfaction of an award with cash, or are reacquired by the Company as a result of forfeiture or termination, expiration or cancellation of an award, will again be available for issuance under the 2022 Plan (on a one-to-one basis). However, shares that are used to pay the exercise price of an option or SAR, including through a net exercise or attestation, or shares that are surrendered for payment of tax withholding obligations will be counted as issued under the 2022 Plan and will reduce the number of shares available for issuance.

 

23

 

Adjustment Provision

 

In the event of (i) a merger, consolidation, acquisition of property or shares, stock rights offering, liquidation, disposition for consideration of an equity interest in a subsidiary or affiliate, or similar event affecting the Company; or (ii) a stock dividend, stock split, reverse stock split, reorganization, share combination, or recapitalization or similar event affecting the capital structure of the Company, or a disaffiliation, separation or spinoff, or other extraordinary dividend, the Talent and Compensation Committee or our Board may (or, in certain cases, will) in its discretion, in the case of events described in clause (i) and (ii), make such substitutions or adjustments as it deems appropriate and equitable to: (a) the various maximum limitations on the grants to individuals of certain types of awards; (b) the aggregate number and kind of shares or other securities reserved for issuance and delivery under the 2022 Plan; (c) the number and kind of shares or other securities subject to outstanding awards; (d) financial goals or results relating to a performance goal; (e) the number of shares considered delivered based on the type of award granted; and (f) the exercise price of outstanding awards.

 

In the case of certain corporate transactions, such an adjustment may consist of cancellation of outstanding awards in exchange for payments of cash, property or a combination of both having an aggregate value equal to the value of such awards, which in the case of an option may be the excess, if any, of the deal consideration per share over the per share exercise price.

 

Individual Award Limits

 

The 2022 Plan provides for the following individual annual limits on awards:

 

The maximum aggregate number of shares subject to options and SARs that may be granted pursuant to awards in any one calendar year to any one participant (other than a nonemployee director) is 200,000 shares.

 

The maximum aggregate number of shares subject to restricted stock, restricted stock units and performance shares that may be granted pursuant to awards in any one calendar year to any one participant (other than a nonemployee director) is 200,000 shares.

 

The maximum grant date fair value of awards covering shares that may be granted in any one calendar year to any one director is $200,000.

 

Minimum Vesting Period

 

Awards will not have a designated vesting period of less than one year, except for (i) awards granted with respect to a maximum of five percent (5%) of the shares authorized under the 2022 Plan, (ii) awards that are settled in cash, and (iii) awards granted to nonemployee directors at the Company’s annual meeting of shareholders that do not vest earlier than the date of the Company’s next annual meeting of shareholders.

 

Eligibility

 

Awards may be granted under the 2022 Plan to directors, officers, employees and consultants of the Company or any of its subsidiaries or affiliates, and prospective directors, officers, employees and consultants who have accepted offers of employment or consultancy from the Company or its subsidiaries or affiliates (collectively, “eligible individuals”), although incentive stock options may be granted only to employees of the Company and its subsidiaries or parent corporation (within the meaning of Section 424(f) of the Internal Revenue Code of 1986 (the “Code”).

 

Types of Awards

 

The 2022 Plan authorizes grants of a variety of awards described below. The Talent and Compensation Committee determines the terms and conditions of each award at the time of grant, including whether payment of awards may be subject to the achievement of performance goals, consistent with the provisions of the 2022 Plan. The Talent and Compensation Committee may also provide for other terms of the award as set forth in the award agreement such as vesting or continued vesting of such award upon certain terminations of employment of the participant, including due to death, disability or retirement, or the occurrence of a change in control.

 

Stock Options

 

The number of shares subject to a stock option, the type of stock option (i.e., incentive stock option or nonqualified stock option), the exercise price of a stock option (which will be not less than the fair market value of a share on the date of grant) and the period of exercise (including upon termination of employment) will be determined by the Talent and Compensation Committee and set forth in an award agreement provided that no option will be exercisable more than 10 years after the date of grant. Options granted under the 2022 Plan will be exercisable at such times and be subject to such restrictions and conditions as the

 

24

 

Talent and Compensation Committee approves, including conditions related to the employment of, or provision of services by, a participant. The option price upon exercise may be paid to the Company in full: (i) in cash; (ii) by cash equivalent approved by the Talent and Compensation Committee; (iii) by tendering previously acquired shares having an aggregate fair market value at the time of exercise equal to the total exercise option price; (iv) by delivery of a notice of a net exercise; or (v) by any combination of the foregoing. Subject to applicable law, the Talent and Compensation Committee may also allow cashless exercise or exercise by any other means approved by the Talent and Compensation Committee.

 

SARs

 

SARs granted under the 2022 Plan entitle the participant to receive an amount payable in shares or cash, or both, as determined by the Talent and Compensation Committee, equal to the excess of the fair market value of a share on the day the SAR is exercised over the specified exercise price, which will not be less than the fair market value of a share on the grant date of the SAR. The exercise period of a SAR may not exceed ten (10) years. SARs may be granted in tandem with a related stock option or independently. The Talent and Compensation Committee will determine and set forth in an award agreement relating to the award or other agreement the extent to which SARs are exercisable after termination of employment.

 

Restricted Stock and Restricted Stock Units

 

Restricted stock is an award of shares that vests over time and is subject to forfeiture in certain circumstances. Restricted stock awards may be made either alone, in addition to, or in tandem with other types of awards permitted under the 2022 Plan and may be current grants of restricted stock or deferred grants. The terms of restricted stock awards, including the restriction period and the extent to which the participant will have the right to receive unvested restricted stock following termination of employment or other events will be determined by the Talent and Compensation Committee and be set forth in an agreement relating to such award. Unless otherwise set forth in an agreement relating to a restricted stock award, the participant receiving restricted stock will have all of the rights of a shareholder of the Company, including the right to vote the shares and the right to receive dividends as described below. Under the exception to the minimum vesting period, the Talent and Compensation Committee may grant awards of common stock that are not subject to vesting restrictions.

 

A restricted stock unit is an unsecured promise to transfer a share or equivalent cash at a specified future date, such as a fixed number of years, retirement or other termination of employment (which date may be later than the vesting date of the award at which time the right to receive the share becomes nonforfeitable). Restricted stock units represent the right to receive a specified number of shares at specified times and is subject to restriction periods and other conditions as the Talent and Compensation Committee determines. A participant to whom restricted stock units are awarded has no rights as a shareholder with respect to the shares represented by the restricted stock units unless and until shares are actually delivered to the participant in settlement of the award.

 

Performance Shares

 

Performance shares are awards granted in terms of a stated potential maximum number of shares with the actual number and value earned to be determined by reference to the satisfaction of performance targets established by the Talent and Compensation Committee and may be payable in shares, cash or a combination of shares and cash. Such awards may be granted subject to any restrictions, in addition to performance conditions, deemed appropriate by the Talent and Compensation Committee.

 

Dividend Equivalents

 

Award agreements for restricted stock, restricted share units and performance units may entitle the participant to dividends or dividend equivalents, payable in restricted stock, restricted share units or cash, either currently or subject to the same terms and conditions, including vesting, of the underlying award. However, consistent with the 2022 Plan, under the award agreements for awards granted to our executive officers, the dividends that would have been paid on unvested restricted stock units and performance share awards will be accrued and paid subject to the vesting of the underlying award.

 

25

 

Performance Measures

 

The performance measure(s) to be used for purposes of performance share awards will be determined by the Committee and may be one or more of the following or such other measures as the Committee may determine:

 

Net operating income or the growth in such net operating income;

 

Operating earnings per share or the growth in such operating earnings per share;

 

Annual growth in consolidated total revenue, loans and deposits;

 

Changes or increases in market share;

 

Earnings before taxes or the growth in such earnings;

 

Stock price or the growth in such price;

 

Return on equity, tangible equity, and assets or the growth on such returns;

 

Total shareholders’ return or the growth in such return;

 

Contribution to geographic expansion;

 

Level of expenses or the reduction of expenses, overhead ratios or changes in such ratios, efficiency ratios or changes in such ratios;

 

Loan quality or the changes in the level of loan quality or changes in the ratios of net charge-offs to loans or non-performing assets to assets;

 

Customer satisfaction scores or changes in scores; and/or

 

Economic value added or changes in such value added.

 

Performance measures may relate to the Company or a business unit, division, business segment or subsidiary of the Company. In measuring performance, the Talent and Compensation Committee may adjust the Company’s financial results to exclude the impact of unusual charges or income items that distort year-to-year comparisons of results and other events, including acquisitions or dispositions of businesses or assets, restructurings, reductions in force, currency fluctuations or change in accounting. The Talent and Compensation Committee may also make adjustments to eliminate the impact of changes in tax or accounting rules and regulations.

 

Deferral Rights

 

The Talent and Compensation Committee may permit a participant to defer to another plan or program such participant’s receipt of shares or cash that would otherwise be due to such participant by virtue of the vesting of restricted stock or restricted stock units or the earning of a performance-share award. If any such deferral election is required or permitted, the Talent and Compensation Committee will establish rules and procedures for such payment deferrals.

 

Cancellation and Recoupment of Awards

 

The Talent and Compensation Committee may provide in an award agreement that if the participant engages in any detrimental activity, the Talent and Compensation Committee may cancel, rescind, suspend, withhold or otherwise restrict any unexpired, unpaid or deferred award. The award agreement may also provide that the participant must pay to the Company any gain realized by the participant from exercising the award during the six months prior to, or after, the date the participant enters into such detrimental activity. In general, detrimental activity includes violating certain restrictive covenants relating to noncompetition, nonsolicitation, nondisparagement and confidential information. In addition, awards granted under the 2022 Plan will be subject to the Company’s clawback policy as in effect from time to time and any other applicable remedies available to the Company

 

New Plan Benefits

 

Any awards under the 2022 Plan will be subject to the discretion of the Committee, and therefore, it is not currently possible to determine the amount of future awards. Accordingly, it is not possible to determine the amounts that will be received by officers, directors or other eligible individuals under the 2022 Plan, although our current nonemployee director compensation program provides for an annual stock award to each nonemployee director with a grant date fair value of $55,000.

 

26

 

Federal Income Tax Consequences

 

The following is a brief summary of the current federal income tax consequences of awards made under the 2022 Plan. This summary is general in nature and is not intended to cover all tax consequences that may apply to participants and the Company. Further, the provisions of the Code and the regulations and rulings thereunder relating to these matters may change.

 

Stock Options

 

A participant will not recognize any income upon the grant of a stock option but will recognize compensation taxable as ordinary income (and subject to income tax withholding) upon exercise of a nonqualified stock option equal to the excess of the fair market value of the shares purchased over the exercise price, and the Company will be entitled to a corresponding deduction. A participant will not recognize income (except for purposes of the alternative minimum tax) upon exercise of an incentive stock option; provided that the incentive stock option is exercised either while the participant is an employee of the Company or within three months (one year if the participant dies or is disabled within the meaning of Section 22(e)(3) of the Code) following the participant’s termination of employment. If shares acquired through the exercise of an incentive stock option are held for the longer of two years from the date the option was granted and one year from the date it was exercised, any gain or loss arising from a subsequent disposition of such shares will be taxed as a long-term capital gain or loss, and the Company will not be entitled to any deduction. If, however, such shares are disposed of within the above- described period, in the year of such disposition the participant will recognize income taxable as ordinary income equal to the excess of (i) the fair market value of such shares on the date of exercise or, if less, the amount realized upon such disposition, over (ii) the exercise price. In such case, the Company will be entitled to a corresponding deduction, subject to Section 162(m) of the Code.

 

SARs

 

A participant will not recognize any income upon the grant of a SAR. A participant will recognize compensation taxable as ordinary income (and subject to income tax withholding) upon exercise of a SAR equal to the fair market value of any shares delivered and the amount of any cash paid to the participant upon such exercise, subject to Section 162(m) of the Code.

 

Restricted Stock

 

A participant will not recognize taxable income at the time of grant of a restricted stock award, and the Company will not be entitled to a tax deduction at such time unless the participant makes an election under a special Code provision to be taxed at the time such restricted stock award is granted. If such election is not made, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding) at the time the restrictions on such restricted stock award lapse in an amount equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for such shares. The amount of ordinary income recognized by a participant making the above-described special election or upon the lapse of the restrictions is deductible by the Company as compensation expense. In addition, a participant receiving dividends with respect to shares subject to a restricted stock award for which the above-described election has not been made and prior to the time the restrictions lapse will recognize taxable compensation (subject to income tax withholding), rather than dividend income, in an amount equal to the dividends paid, and the Company will be entitled to a corresponding deduction, subject to Section 162(m) of the Code.

 

Restricted Stock Units

 

A participant will not recognize taxable income at the time of grant of a restricted stock unit, and the Company will not be entitled to a tax deduction at such time. When the participant receives shares pursuant to vesting or a distribution election for the restricted stock unit, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding) in an amount equal to the fair market value of any shares delivered and the amount of any cash paid to the participant, and the Company will be entitled to a corresponding deduction, subject to Section 162(m) of the Code.

 

Performance Shares

 

A participant will not recognize taxable income at the time of grant of a performance-share award, and the Company will not be entitled to a tax deduction at such time. Upon the settlement of a performance-share award, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding) in an amount equal to the fair market value of any shares delivered and the amount of any cash paid to the participant, and the Company will be entitled to a corresponding deduction, subject to Section 162(m) of the Code.

 

27

 

Section 162(m) of the Code

 

Section 162(m) of the Code denies an income tax deduction to an employer for certain compensation in excess of $1,000,000 per year paid by a publicly traded corporation to certain “covered employees” as defined in Section 162(m) of the Code. This may result in all or a portion of the awards granted under the 2022 Plan to “covered employees” failing to be deductible by the Company for federal income tax purposes.

 

Section 409A of the Code

 

Section 409A of the Code establishes certain requirements with respect to compensation provided to employees and directors that is considered to be “deferred compensation” as defined in Section 409A. If any awards granted under the 2022 Plan are subject to Section 409A, the Company intends that such awards will comply with Section 409A. If a deferred compensation arrangement does not meet the requirements of Section 409A, the compensation is subject to additional taxes, penalties and interest.

 

Equity Compensation Plan Information

 

The table below provides information as of December 31, 2021 regarding securities authorized for issuance under the Company’s equity compensation plans.

 

Plan Category Number of securities to be issued upon
exercise of outstanding options, warrants
and rights
(a)
Weighted- average exercise price of
outstanding options, warrants and rights
(b)
Number of securities remaining available
for future issuance under equity
compensation plans (excluding securities
reflected in column (a))
(c)
Equity compensation plans approved by shareholders 983,8251 $8.382 600,1063
Equity compensation plans not approved by shareholders 595,7054 N/A
Total 1,579,530 $8.38 600,106

 

1 This amount includes:

252,962 performance-based restricted stock units based on the maximum number of shares potentially payable under the awards (187.5% of target) that have not been earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

19,492 performance-based restricted stock units (150% of target) that were earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

15,677 performance-based restricted stock units (141% of target) that were earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

16,127 performance-based restricted stock units (145% of target) that were earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

23,340 performance-based restricted stock units (133% of target) that were earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

6,478 performance-based restricted stock units based on the maximum number of shares potentially payable under the awards (100.0% of target) that have not been earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all granted under the 2000 Plan;

2,159 performance-based restricted stock units (100% of target) that were earned as of December 31, 2021. The number of shares, if any, to be issued pursuant to such awards will be determined based upon performance over the applicable performance period. The performance-based restricted stock units are all issued under the 2000 Plan;

612,130 time-based restricted stock units, which were granted under the 2000 Plan; and

35,460 outstanding stock options, which were granted under the 2000 Plan.

2 The price in column (b) reflects the weighted average price of all outstanding options under the 2000 Plan that, as of December 31, 2021, had been granted but not forfeited, expired or exercised. Performance-based and time-based restricted stock units are not included in determining the weighted average in column (b) because they have no exercise price.

3 Includes securities available for issuance in connection with awards under the 2000 Plan.

4 The number in column (a) represents the number of shares of our common stock credited to participant accounts in the Deferred Compensation Plan. The table above does not include any shares that may be credited in the future to participant accounts in the Deferred Compensation Plan. This amount includes:

483,456 shares of United common stock that are issuable under the Deferred Compensation Plan at December 31, 2021 as a result of deferrals previously granted under an equity compensation plan approved by shareholders.

112,249 shares of United common stock that are issuable under the Deferred Compensation Plan at December 31, 2021 as a result of deferrals not previously granted under an equity compensation plan approved by shareholders.

 

 

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR”
THE APPROVAL OF THE 2022 PLAN (PROPOSAL 2).

 

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Executive Officers

 

Information regarding our current executive officers is set forth below. Each of our executive officers is appointed annually by the Board and serves at the discretion of the Board.

 

Name (age) Position with United and Employment History

 

 

H. Lynn Harton

Age: 60

Officer of United Since 2012

Lynn Harton has served as President, Chief Executive Officer and Director since 2018. Mr. Harton served as President, Chief Operating Officer and Director from 2015 to 2018.

 

Immediately prior to joining United in 2012, Harton was Executive Vice President and Head of Commercial Banking-South for TD Bank, N.A. Prior to that, Harton served as President and Chief Executive Officer at The South Financial Group (which was sold to TD Bank). With a career beginning in 1983, he has held various executive positions at BB&T, Union Planters Corporation and Regions Financial Corporation.

   

 

Jefferson L. Harralson

Age: 56

Officer of United Since 2017

Jefferson Harralson has served as Chief Financial Officer since 2017.

 

Prior to joining United in 2017, Mr. Harralson was a managing director for Keefe, Bruyette and Woods (“KBW”). He joined KBW as vice president in 2002 and was charged with rebuilding the firm’s Southeastern Bank Research effort after the events of September 11, 2001. He led KBW’s small and midsized bank research team and was associate director of research for the entire firm.

   

 

Richard W. Bradshaw

Age: 60

Officer of United Since 2014

Rich Bradshaw has served as Chief Banking Officer since 2019. Mr. Bradshaw served as President, Commercial Banking Solutions from 2014 to 2018.

 

Prior to joining United in 2014, Mr. Bradshaw served as the head of U.S. SBA Programs at TD Bank and led the bank to become the 8th largest SBA lender in the United States. Bradshaw also developed a successful SBA lending unit at Carolina First before it was acquired by TD Bank. He previously served as president at UPS Capital Business Credit in Atlanta, GA where he was responsible for sales and marketing, asset-based lending, equipment leasing, SBA and insurance.

 

Bradshaw is a retired commander from the U.S. Naval Reserve Intelligence Program and served five years of active duty as a captain in the U.S. Air Force.

   

 

Robert A. Edwards

Age: 57

Officer of United Since 2015

Rob Edwards has served as Chief Risk Officer since 2019. Mr. Edwards served as Chief Credit Officer from 2015 to 2019.

 

Prior to joining United in 2015, Mr. Edwards served as executive credit officer over Credit Policy and Risk Reporting and Analytics at TD Bank N.A. He also served as the chief credit officer at The South Financial Group.

   

 

Melinda Davis Lux

Age: 49

Officer of United Since 2020

Melinda Davis Lux has served as General Counsel and Corporate Secretary since 2020.

 

Prior to joining United in 2020, Ms. Davis Lux was a partner with Womble Bond Dickinson in Greenville, S.C. and served as a Global Board Member of Womble Bond Dickinson International. Earlier in her career, Davis Lux was a partner with the Wyche Law Firm, a corporate associate for Kilpatrick Stockton, LLP and Law Clerk to the Honorable Alexander B. Denson of the U.S. District Court in Raleigh, North Carolina.

   

 

Mark Terry

Age: 55

Officer of United Since 2016

Mark Terry has served as Chief Information Officer since 2017. Mr. Terry served as Chief Technology Officer from 2016 to 2017.

 

Prior to joining United in 2016, Mr. Terry served as Chief Information Officer of The Palmetto Bank, Chief Information Officer of the Forcht Group of Kentucky, and System Engineer at EDS, Inc.

 

29

 

Proposal 3: Advisory Vote to Approve Named Executive Officer Compensation

 

In accordance with Section 14A of the Securities Exchange Act of 1934, as amended, we provide our shareholders each year with an opportunity to vote, on an advisory basis, on compensation paid to our named executive officers (“Named Executive Officers” or “NEOs”) as disclosed in this Proxy Statement pursuant to Item 402 of Regulation S-K. Accordingly, we are asking our shareholders to provide an advisory nonbinding (“say-on-pay” vote) to approve our executive compensation as we have described it in Executive Compensation: Compensation Discussion and Analysis and in the accompanying compensation tables. At our 2021 Annual Meeting of Shareholders, over 97% of the votes cast favored the “say- on-pay” proposal. Our Talent and Compensation Committee believes that this result evidences strong shareholder support of our executive compensation programs and maintained a consistent overall approach for 2021.

 

Our Talent and Compensation Committee oversees our executive compensation program, structures the program, adopts changes to the program and awards compensation as appropriate to reflect United’s performance and promote the objectives of the program. Our compensation programs are designed to attract and retain talented, experienced and qualified individuals, to motivate and reward outstanding performance while maintaining safe and sound banking practices, to promote our strategic goals and to support long-term value creation for our shareholders.

 

The “say-on-pay” vote is advisory and will not be binding on the Board or the Talent and Compensation Committee. However, our Board and Talent and Compensation Committee value our shareholders’ views and will consider the outcome of the vote when making future executive compensation decisions.

 

 

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE 

“FOR” OUR “SAY-ON-PAY” PROPOSAL (PROPOSAL 3). 

 

30

 

Executive Compensation

 

This section provides details of compensation during 2021 for our NEOs:

 

Name Position
H. Lynn Harton Chairman, President and Chief Executive Officer
Jefferson L. Harralson Executive Vice President, Chief Financial Officer
Richard W. Bradshaw Executive Vice President, Chief Banking Officer
Robert A. Edwards Executive Vice President, Chief Risk Officer
Melinda Davis Lux Executive Vice President, General Counsel and Corporate Secretary

 

Compensation Discussion and Analysis

 

Overview of Compensation Program

 

Our Talent and Compensation Committee is responsible for determining the compensation that is paid or awarded to our Company’s executive officers. For purposes of this Proxy Statement, the term “executive officer” means the executive leadership of the Company, including the NEOs. Our Talent and Compensation Committee strives to design our executive compensation programs to serve the long-term interests of our shareholders. To deliver superior shareholder returns, we believe that it is critical to provide competitive compensation packages that will attract, retain and motivate talented and experienced executives with the requisite expertise. Our program is designed to balance short-term and long-term components of compensation and, consequently, incent achievement of our annual business plan and long-term business strategies.

 

2021 Select Business Highlights

 

Short-Term Highlights

 

Diluted net income per common share (GAAP) 

For the Years Ended December 31,
2021 2020 Change % / bp
$2.97    $1.91   55.5%
Diluted net income per common share (operating) $3.09    $1.98   56.1%
Net income  (GAAP) ($000) $269,801    $164,089   64.4%
Net income (operating) ($000) $280,597    $169,767    65.3%
Return on assets (GAAP) 1.37% 1.04% 0.33   
Return on assets (operating) 1.42% 1.07% 0.35   
Return on common equity (GAAP) 13.14% 9.25% 3.89   
Return on common equity (operating) 13.68% 9.58% 4.10   
Return on tangible common equity (operating) 17.33% 12.24% 5.09   
Net charge-offs to average loans 0.00% 0.17% 0.17   

 

See reconciliation of non-GAAP measures related to GAAP financial measures on page 46 of United’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022.

 

In addition to financial highlights, during 2021, the Company:

 

Experienced loan growth of 4.9% excluding PPP runoff.

Experienced deposit growth of 15.7% excluding brokered certificate of deposit accounts.

Awarded $277 thousand in charitable contributions to improve the economic vitality and quality of life in the communities we serve through the United Community Bank Foundation.

Acquired FinTrust, an investment advisory firm headquartered in Greenville, South Carolina, with additional locations in Anderson, South Carolina, and Athens and Macon, Georgia, on July 6, 2021. The firm provides wealth and investment management services to individuals and institutions within its markets.

Completed the acquisition of Aquesta, a bank headquartered in Cornelius, North Carolina that operated a network of branches primarily located in the Charlotte metropolitan area, on October 1, 2021.

Entered into an agreement to aquire Reliant, a bank headquartered in Brentwood, Tennessee, a suburb of Nashville, which closed on January 1, 2022. Reliant operates a 25 branch network in Tennessee, located primarily in the Nashville, Clarksville and Chattanooga metropolitan areas. It also has a manufactured housing finance group based in Knoxville.

 

31

 

Appointed Jennifer M. Bazante to serve on our Board of Directors, effective September 1, 2021. Ms. Bazante is the Chief Marketing and Communications Officer for Humana, Inc., by whom she has been employed since 2014, and brings a depth of experience leading world-class marketing organizations.

Was recognized by Forbes as one of the “100 Best Banks in America” for the eighth consecutive year.

Was recognized by J.D. Power as having the highest customer satisfaction score in the Southeast.

Was named one of the Best Banks to Work For by American Banker for the fifth consecutive year.

 

Long-Term Highlights

 

We have generated strong financial results over the past 5+ years, more than doubling net income while also adding substantial capital, both organically and through M&A. Since the end of 2016, we increased our already strong common equity tier-1 risk-based capital ratio by 123 basis points to 12.46% and our tier-1 risk-based capital ratio by 194 basis points to 13.17% providing greater flexibility for strategic company growth and capital actions while maintaining a strong balance sheet. In spite of the volatile operating environment created by the COVID-19 pandemic, we have continued to outperform our peers with respect to both return on average assets (“ROA”) and return on average tangible common equity (“ROTCE”).

 

(GRAPHIC)

 

(GRAPHIC) 

 

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Total Shareholder Return (“TSR”)

 

The graph below shows our TSR1 expressed as the cumulative return to shareholders over the past decade. As illustrated, a $100 investment in United Community Banks, Inc. common stock on December 31, 2011 would be valued at $587 as of December 31, 2021, significantly outperforming the financial services industry over the period, as measured by the KBW NASDAQ Regional Bank Index (KRX).

 

Performance for the
period ended
December 31, 2021

United Community

Banks, Inc.

KBW Nasdaq Regional

Bank Index (KRX) 

1-Year 35% 32%
3-Year 173% 60%
5-Year 337% 45%
10-Year 497% 239%

 

(GRAPHIC) 

 

1 TSR shows the actual return on an initial investment with dividends reinvested.

 

33

 

Key Aspects of the 2021 Executive Compensation Program

 

Overview

 

Our executive compensation program is comprised of three main components:

 

 

 

Base Salary •     Primarily reflects scope of responsibilities, individual skills and capabilities and individual performance in light of competitiveness in the markets in which we retain executive talent
Annual Nonequity Incentive Awards •     Provides short-term variable pay for performance based on key operating goals
Long-Term Equity Incentive Awards •     Consists of grants of performance-based and time-based restricted stock units
  •     Aligns the long-term interests of our executive officers with those of our shareholders to support long-term value creation

 

 

 

Annual Nonequity Incentive Awards Earned in 2021

 

During 2021, each NEO earned a payout under our annual nonequity incentive award program of 140.10% of his or her target payout level.

 

The Committee selected the following six performance objectives and assigned weights for 2021 nonequity incentive awards:

 

  2021 Corporate Performance Levels  
50% 100% 150%
Performance Objective Overall Weight Threshold Target Maximum 2021 Actual 2021 Result
Pre-Tax Pre-Provision Earnings per Share 20.0 % $ 3.30     $ 3.40     $ 3.47     $ 3.50     30.00 %
Operating Earnings per Share 15.0     $ 2.14     $ 2.20     $ 2.25     $ 3.09     22.50 %
Net Charge-Offs / Total Loans 15.0     0.35 % 0.27 % 0.20 % 0.00 % 22.50 %
NPAs / Total Assets1 15.0     25th Percentile     50th Percentile     75th Percentile     75th Percentile     22.50 %
Operating Efficiency Ratio 20.0     57.00 % 54.30 % 52.30 % 53.83 % 22.35 %
Customer Satisfaction Rating 15.0     95.50 % 96.50 % 97.50 % 97.20 % 20.25 %
            140.10 %
             
1 NPAs / Total Assets metric excludes restructured loans.    

 

For 2021, the Talent and Compensation Committee adjusted the performance objectives for nonequity incentive awards as compared to prior years. Specifically, the Talent and Compensation Committee determined that it was appropriate to add two new performance objectives for 2021 nonequity incentive awards: pre-tax pre-provision earnings per share and net charge offs as a percentage of total loans. The Talent and Compensation Committee determined that economic forecasts outside of the control of management had the potential to drive current expected credit losses methodology (“CECL”) provision releases in 2021 that could artificially increase earnings per share. As such, the Committee deemed it appropriate to use pre-tax, pre-provision earnings per share as a measure more directly driven by management’s performance rather than exogenous factors.

 

See 2021 Executive Compensation Components: Annual Nonequity Incentive Awards for additional information regarding annual nonequity incentive awards earned by NEOs in 2021.

 

34

 

Long-Term Equity Incentive Awards Granted in 2021

 

Our 2021 long-term equity incentive award grants were made in restricted stock units that consisted of 70% performance-based restricted stock units (“PRSUs”) and 30% time-based restricted stock units (“TRSUs”) as shown in the table below.

 

Name 

Target Award as %

of Base Salary

2021 Annual Equity
Incentive Award
(PRSUs) (#)
Fair Value of 2021 Annual
Equity Incentive
Award (PRSUs) ($)
2021 Annual Equity
Incentive Award
(TRSUs) (#)

Fair Value of 2021

Annual Equity Incentive 

Award (TRSUs) ($) 

H. Lynn Harton 115.0 % 21,234 $ 638,294 9,125 $ 274,298
Jefferson L. Harralson 70.0     6,910 207,715 2,970 89,278
Richard W. Bradshaw 70.0     6,910 207,715 2,970 89,278
Robert A. Edwards 70.0     6,503 195,480 2,795 84,018
Melinda Davis Lux 70.0     5,691 171,071 2,446 73,527

 

Annual PRSUs granted in 2021 will vest, if at all, in equal installments with 25% vesting on February 15 of each of the following years: 2023, 2024, 2025 and 2026. Vesting of the PRSUs on each vesting date will be based on our performance in the immediate calendar year before vesting (e.g., the number of awards that vest on February 15, 2023 will be determined by our performance for the 2022 calendar year).

 

Annual TRSUs granted in 2021 will vest in equal installments with 25% vesting on November 15, 2022 and then on August 15 of 2023, 2024 and 2025 assuming the executives remain employed with us, subject to certain exceptions.

 

The performance measure selected by the Talent and Compensation Committee for the PRSUs is our return on average assets for the applicable calendar year performance period relative to the designated peer group as adjusted by the TSR modifier relative to the same designated peer group.

 

See 2021 Executive Compensation Components: Long-Term Equity Incentive Awards for additional information regarding long-term equity incentive awards granted to NEOs in 2021.

 

Shareholder Response

 

The most recent shareholder advisory vote on our NEO compensation was held at our 2021 Annual Meeting of Shareholders. Excluding abstentions and broker nonvotes, over 97% of the votes cast were in support of our executive compensation program. Because we view this outcome as overwhelmingly supportive of our compensation policies and practices, we do not believe the vote requires consideration of changes to the program. Nonetheless, because market practices and our business needs continue to evolve, we continually evaluate our program and make changes when warranted.

 

Pay for Performance

 

Consistent with our compensation philosophy, and as illustrated below, a significant portion of 2021 total direct compensation for our NEOs was based on performance as compared to pre-established goals.

 

(GRAPHIC) 

 



Variable/At Risk 

CEO 62%
All Other NEOs 53%

 

Legend:

TRSU — Long-Term Equity Incentive Awards (Time-Based)

PRSU — Long-Term Equity Incentive Awards (Performance-Based)

 

35

 

Compensation Philosophy and Objectives

 

Our overall compensation philosophy seeks to achieve the following objectives with respect to our employees:

 

Competitive We offer competitive compensation to our executives and employees based on comparable external market information.
Fair and Equitable We are committed to the fair and equitable administration of our compensation and incentive plans.
Performance-Based We strive to reward our employees on the basis of individual and company-wide, risk-adjusted performance.
Long-Term Soundness We attempt to appropriately balance risks and rewards in a manner that does not encourage excessive or imprudent risk-taking by our executives and employees. We take into account a number of performance metrics when determining whether to award incentive compensation to promote long-term financial success.
Communication We make every effort to communicate each individual’s compensation package clearly.
Peer Positioning We use peer compensation levels to help guide our decisions. Our targets for total direct compensation (base salary, annual incentives and long-term incentives) are:

  a. New to Position: Between the 1st and 40th percentile
  b. Experienced: 40th -60th percentile
  c. Proven High Performer: 60th -75th percentile

 

The material compensation principles applicable to the compensation of our NEOs are outlined below:

 

In determining total compensation, we consider the reasonable range of the median of total compensation of comparable positions at companies within our market comparator group, while accounting for distinct circumstances not reflected in the market data such as unique job descriptions as well as the impact that a particular officer may have on our ability to meet business objectives. For competitive or other reasons, our levels of total compensation or any component of compensation may exceed or be below the median range of our market comparator group.

We set base salaries to reflect the responsibilities, experience, performance and contributions of the NEOs and the salaries for comparable benchmarked positions while maintaining an appropriate balance between base salary and incentive compensation.

We reward NEOs who enhance our performance by linking nonequity and equity incentive awards to the achievement of our financial goals.

We promote share ownership to align the interests of our NEOs with those of our shareholders.

In approving compensation arrangements, we consider recent compensation history including special or unusual compensation payments.

 

We have change-in-control severance agreements with our NEOs to promote executive continuity, aid in retention and secure valuable protections for United, such as restrictive covenants, as well as to facilitate implementation of our clawback policy.

 

The Talent and Compensation Committee believes that:

 

The compensation of our executive officers should reflect their individual performance and their performance as an executive management team in attaining key operating metrics.

Performance objectives should be motivating and challenging but also achievable and consistent with our safe and sound operation.

Compensation should not be based on the short-term performance of our stock, whether favorable or unfavorable, and should not encourage unnecessary or excessive risks.

 

Compensation Best Practices

 

We strive to align our executives’ interests with those of our shareholders. We further strive to follow sound governance practices over our executive compensation program and to ensure that our compensation programs and practices are consistent with safe and sound banking practices. Below are key features of our executive compensation program that we believe encourage executive performance consistent with responsible compensation practices.

 

36

 

What We Do    
     
     
     
Pay for Performance   A significant portion of executive compensation is linked to key metrics of financial performance.
     
     
     
Multi-Year Vesting
Period for
Long-Term Incentive
Awards
  Time-based restricted stock unit and performance-based restricted stock unit awards generally vest, subject to performance achievement, ratably over a four-year period.
     
     
Double Trigger
Change-in-Control
Provisions
  Our severance agreements require both a change in control and termination of employment without cause or for good reason for an executive to be entitled to severance payments. In addition, our long-term equity incentive awards for executive officers include similar double-trigger vesting provisions.
     
     
United Share
Ownership
Guidelines
  We have robust share ownership guidelines for our executive officers to align the interests of our executive officers with those of our shareholders.
     
     
     
Clawback Policy   Our Board has adopted a policy relating to the clawback of incentive compensation paid to our executive officers in the event of certain restatements of our financial statements.
     
     
Annual
Compensation
Risk Assessment
  Our Talent and Compensation Committee assesses the risk of all compensation programs at least annually.
     
     

 

What We Don’t Do
     
     
     
No Tax Gross-Ups   We do not provide any tax gross-ups.
     
     
     
     
No Hedging or
Pledging of
United Stock
  We have a policy that prohibits our directors, officers and employees from engaging in short sales, trading in puts, calls and other options or derivatives with respect to our stock and hedging our stock.
     
     
     
     
No Repricing of
Stock Options
Without Shareholder
Approval
  Our Key Employee Stock Option Plan prohibits repricing without shareholder approval.
     
     

 

37

 

Role of the Talent and Compensation Committee

 

Oversight

 

Our Talent and Compensation Committee is comprised entirely of independent directors. The Committee determines and approves the compensation of our executive officers. The independent members of our Board of Directors provide input with respect to our CEO’s compensation and ratify the Talent and Compensation Committee’s determinations with respect to our CEO’s compensation.

 

Approach to Total Compensation and its Components

 

In establishing the total compensation of each of our executive officers, the Talent and Compensation Committee considers the following factors:

 

Scope of responsibilities

Value of his or her unique skills and capabilities to support our long-term performance

Contribution as a member of the executive management team

Performance as compared to individual objectives

Performance of the Company as compared to the Company’s three-year strategic plan and annual business plan

Performance of the Company as compared to a peer group

Peer group compensation information

 

In determining total compensation of our executive officers, the Talent and Compensation Committee considers the reasonable range of the median of total compensation of comparable positions at companies within our peer group. The Committee also considers the balance of nonequity and equity compensation and short-term and long-term compensation of comparable positions at companies within our peer group. The Committee does not have a policy or target for the allocation of compensation between nonequity and equity compensation or short-term and long-term compensation.

 

Our Talent and Compensation Committee believes that a significant portion of executive compensation should be based on Company performance. Our annual nonequity incentive awards are granted based 100% on the performance of the Company as compared to pre-established goals. In addition, at least 70% of our long-term equity incentive awards vest based on the performance of the Company as compared to pre-established goals.

 

Our Talent and Compensation Committee believes that granting long-term equity incentive awards to our executive officers provides a competitive incentive opportunity, links executive compensation with long-term performance and strengthens the alignment of executive compensation with shareholder value creation.

 

We utilize our equity-based awards:

 

As a retention tool to encourage the long-term service of our executives

To provide our executive management team a direct interest in our future success

To directly align the interests of our executives with shareholder value creation

 

Role of Outside Advisors

 

In 2021, the Talent and Compensation Committee retained Aon’s Human Capital Solutions practice, a division of Aon plc (“Aon”), otherwise known as McLagan, to provide independent compensation consulting services. Aon has provided compensation consulting services to the Talent and Compensation Committee since 2015.

 

The Talent and Compensation Committee determines the scope of Aon’s services and has approved a written agreement pursuant to which Aon provides independent advice to the Committee. The approved scope of Aon’s work generally includes performing analyses and providing independent advice related to our executive and nonemployee director compensation programs, providing competitive market studies and other services that support the Talent and Compensation Committee’s decisions, such as providing advice in areas such as compensation philosophy, compensation risk assessment, market comparator group, incentive plan design, executive compensation disclosure, emerging best practices and changes in the regulatory environment. 

 

38

 

Aon, along with management, also prepares benchmarking data for consideration by the Talent and Compensation Committee in making decisions with respect to base salary, the annual nonequity incentive award program and the long-term equity incentive award program.

 

The Talent and Compensation Committee annually reviews the independence and performance of its compensation consultant and the consulting services provided. In evaluating the independence and performance and considering the retention of its compensation consultant, the Talent and Compensation Committee also assesses the consultant’s independence in accordance with Nasdaq listing standards, taking into account whether:

 

The consultant provides other services to United;

The fees paid by United to the compensation consultant represent an insignificant portion of the consultant’s total revenues;

The consultant maintains policies and procedures designed to prevent conflicts of interest between the consultant and the companies to which it provides services, as well as between its individual employees and such companies;

United or any member of the Talent and Compensation Committee have any other business or personal relationship with the consultant or its employees who provide services to the Committee;

The consultant, or its employees who provide services to the Talent and Compensation Committee, own any United securities; and

Any executive officer of United has any business or personal relationship with the consultant or its employees who provide services to the Talent and Compensation Committee.

 

In 2021, Aon’s compensation advisory role included providing market information on executive and director compensation levels and practices, assisting in the design of executive and director compensation programs and providing input on related technical and regulatory matters. The total fees paid to Aon in 2021 were comprised of $178,597 in services for executive compensation consulting, $36,475 in additional services for surveys, incentive plan designs and compensation benchmarking and $167,778 in other services.

 

Based upon these and other factors, the Talent and Compensation Committee concluded that the retention of Aon did not present any conflicts of interest, that Aon was independent and that such retention was appropriate.

 

When requested by the Talent and Compensation Committee, an Aon representative attends Committee meetings and participates in private sessions with the Committee. Talent and Compensation Committee members may consult directly with Aon from time to time as desired, and the chair of our Talent and Compensation Committee regularly consults with Aon with respect to Committee responsibilities and compensation matters.

 

Management’s Role in Determining Executive Compensation

 

Our executive management team develops a rolling three-year strategic plan and annual business plan. The three-year strategic plan and annual business plan are reviewed and approved by our Board. Financial performance targets used in our incentive compensation programs typically are derived from those plans.

 

Our CEO develops compensation recommendations for our executive officers based on each executive’s scope of responsibilities, individual performance and contributions to the executive management team, as well as market data provided by Aon. The CEO evaluates and reports to the Talent and Compensation Committee on the performance of each of the other NEOs, in each case, versus previously established goals. The Talent and Compensation Committee also has input into each NEO’s performance evaluation. No objective criteria or relative weighting is assigned to any individual goal or factor. In making compensation recommendations, the CEO also takes into account United’s performance as compared to our Board-approved plans and peer group performance. Our Talent and Compensation Committee reviews and considers the recommendations of the CEO and his evaluation of the performance of our executive officers.

 

Our Talent and Compensation Committee determines the compensation of our CEO after assessing the performance of the CEO and the performance of the Company as compared to the Board-approved plans and peer group performance. Our Lead Director, who consults regularly with the CEO and other directors, provides input to the Committee with respect to the CEO’s performance. The Committee also consults with Aon as to the appropriateness of our CEO’s compensation and each component of compensation in light of market practices, sound governance practices and trends in compensation practices in the banking industry.

 

Although the Committee values and solicits management’s input, it retains and exercises sole authority to make decisions regarding executive officer compensation. 

 

39

 

Market Benchmarking

 

On an annual basis, the Talent and Compensation Committee selects a benchmark group of publicly-traded financial institutions to use in assessing the compensation of United’s executive officers. The peer group is used by our Talent and Compensation Committee to ensure that United’s compensation programs offer competitive compensation opportunities and reflect best practices in compensation plan design.

 

Aon assists the Committee in selecting the appropriate peer group companies. The Company determined a new peer group in 2020 for the purposes of setting 2021 compensation, based on comparable assets, commercial loan concentrations, number of branches and states of operation. The 2020 benchmark group of publicly-traded financial institutions used to set 2021 compensation (the “2021 Compensation Peer Group”) included:

 

Company Name1 Ticker City State Total Assets 2019Y ($000)
Ameris Bancorp ABCB Atlanta GA 18,242,579
Atlantic Union Bkshs Corp. AUB Richmond VA 17,562,990
BancorpSouth BXS Tupelo MS 21,052,576
Cadence Bancorp. CADE Houston TX 17,800,229
CenterState Bank Corp. CSFL Winter Haven FL 17,142,025
First Busey Corp. BUSE Champaign IL 9,695,729
First Commonwealth Financial FCF Indiana PA 8,308,773
First Financial Bancorp. FFBC Cincinnati OH 14,511,625
First Financial Bankshares FFIN Abilene TX 8,262,227
First Merchants Corp. FRME Muncie IN 12,457,254
Fulton Financial Corp. FULT Lancaster PA 21,886,040
Heartland Financial USA Inc. HTLF Dubuque IA 13,209,597
Old National Bancorp ONB Evansville IN 20,411,667
Park National Corp. PRK Newark OH 8,558,377
Pinnacle Financial Partners PNFP Nashville TN 27,805,496
Renasant Corp. RNST Tupelo MS 13,400,618
S&T Bancorp Inc. STBA Indiana PA 8,764,649
Sandy Spring Bancorp Inc. SASR Olney MD 8,629,002
Simmons First National Corp. SFNC Pine Bluff AR 21,259,143
SouthState Corp. SSB Winter Haven FL 15,921,881
TowneBank TOWN Portsmouth VA 11,947,663
Trustmark Corp. TRMK Jackson MS 13,497,877
UMB Financial Corp. UMBF Kansas City MO 26,561,355
United Bankshares Inc. UBSI Charleston WV 19,662,324
WesBanco Inc. WSBC Wheeling WV 15,720,112

 

1 The following publicly-traded financial institutions were removed from the 2021 Compensation Peer Group used to set 2021 compensation: Independence Bank Group Inc. – as a result of its pending acquisition, which subsequently fell through, with Texas Capital Bancshares Inc. at the time the compensation peer group was being developed; LegacyTexas Financial Group Inc. – as result of being acquired in fourth quarter 2019 by Prosperity Bancshares Inc.

The following publicly-traded financial institutions were added to the 2021 Compensation Peer Group: First Busey Corporation and Heartland Financial USA Inc. – as a result of expansion of the geographic area to include Illinois and Iowa (among other states); Park National Corp. – as a result of surpassing the 50% commercial loan threshold required to be considered a peer (had previously been excluded due to a relatively low mix of commercial loans in their portfolio).

 

  

The Talent and Compensation Committee believes that this group was representative of the markets in which we compete for executive talent. The Talent and Compensation Committee uses the peer group to obtain a general understanding of the current compensation practices for our industry as compared to United including a review of base salaries, annual nonequity incentive awards and long-term equity incentive awards.

 

When determining compensation for our executive officers for 2021, the Talent and Compensation Committee considered the median range of total compensation and components of compensation for the comparable roles within the 2021 Compensation Peer Group companies. Although the Committee did not seek to set compensation at a specific target level as compared to the 2021 Compensation Peer Group, the Committee considered whether total compensation and its components for each of our executive officers was within a reasonable range of the median compensation for comparable positions at the 2021 Compensation Peer Group companies.

 

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2021 Executive Compensation Components

 

The Company’s executive compensation program has three main components – base salary, annual nonequity incentive awards and long-term equity incentive awards. There are also limited perquisites.

 

Base salary and annual nonequity incentive awards are primarily designed to reward current and past performance. Long-term equity incentive awards are primarily designed to promote long-term future growth. Our Talent and Compensation Committee has structured the Company’s annual nonequity incentive award program and long-term equity incentive award program to motivate executives to achieve the business goals set by the Company and to reward the executives for achieving such goals.

 

Base Salary

 

To attract and retain qualified executives, base salary is provided to our executive officers. The base salary is determined based on position, responsibility and skills and capabilities using competitive criteria as well as an assessment of the individual’s performance. Our Talent and Compensation Committee also considers market data provided by our outside consultants when determining base salaries for executive officers.

 

Base salary levels are typically reviewed annually as part of our annual performance review process as well as upon a promotion or other change in job responsibilities.

 

During 2021, the base salaries of our NEOs changed as follows:

 

Name

2020

Base Salary ($)

2021

Base Salary ($)

  % Change
H. Lynn Harton $ 775,000    $ 795,000    2.6 %
Jefferson L. Harralson 420,000 425,000 1.2
Richard W. Bradshaw 385,000 425,000 10.4
Robert A. Edwards 385,000 400,000 3.9
Melinda Davis Lux 325,000 350,000 7.7

 

The Talent and Compensation Committee determined in 2021 to increase base salaries based primarily on individual performance and market data.

 

Annual Nonequity Incentive Awards

 

The Talent and Compensation Committee believes that a significant portion of executive compensation should be linked directly to the achievement of specified financial and nonfinancial objectives. Our Management Incentive Plan is a pay-for-performance plan that governs the amount of nonequity incentive compensation we award annually to our executive officers. Under the Management Incentive Plan, the Talent and Compensation Committee determines who is eligible to participate in the plan, the threshold, target and maximum payout levels that can be awarded under the plan and the corporate performance metrics and qualitative measures used to determine awards. Those measures are generally based on annual corporate and financial performance goals established at threshold, target and maximum levels based on our strategic and operating objectives. At the end of each year, the actual performance for each of the chosen metrics is measured separately against target level. Corporate performance that meets the target level results in a 100% payout. Awards are prorated for actual performance results between levels (e.g., between threshold, target and maximum). The Talent and Compensation Committee has discretion to modify awards under the Management Incentive Plan.

 

In order to qualify for an annual incentive award, individual performance must also meet expectations of the CEO, the Talent and Compensation Committee and the Board. The CEO evaluates and reports to the Talent and Compensation Committee on the performance of each of the other NEOs, in each case versus previously established goals. The Talent and Compensation Committee also has input into each NEO’s performance evaluation. The Talent and Compensation Committee evaluates the performance of the CEO primarily based on Company performance relative to the strategic plan and annual business plan.

 

2021 Nonequity Incentive Award Performance Goals

 

The Talent and Compensation Committee determined that it was appropriate to change the performance objectives for 2021 nonequity incentive awards. Specifically, the Talent and Compensation Committee determined that it was appropriate to add two new performance objectives as compaired to prior years for 2021 nonequity incentive awards: pre-tax pre-provision earnings per share and net charge offs as a percentage of total loans. The Talent and Compensation Committee determined that economic forecasts outside of the control of management had the potential to drive CECL provision releases in 2021 that could artificially increase earnings per share. As such, the Committee deemed it appropriate to use pre-tax, pre-provision earnings per share as a measure more directly driven by management’s performance rather than exogenous factors.

 

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The six performance objectives, the assigned weight for each objective, the threshold, target and maximum performance level for each objective and our financial performance under each objective for 2021, were as follows:

 

          2021 Corporate Performance Levels
          50%     100%     150%  
Performance Objective   Overall Weight     Threshold     Target     Maximum  
Pre-Tax Pre-Provision Earnings per Share   20.0 %   $3.30     $3.40     $3.47  
Operating Earnings per Share   15.0     $2.14     $2.20     $2.25  
Net Charge-Offs / Total Loans   15.0     0.35 %   0.27 %   0.20 %
NPAs / Total Assets1   15.0     25th Percentile     50th Percentile     75th Percentile  
Operating Efficiency Ratio   20.0     57.00 %   54.30 %   52.30 %
Customer Satisfaction Rating   15.0     95.50 %   96.50 %   97.50 %
 1 NPAs / Total Assets metric excludes restructured loans.  

 

2021 Nonequity Incentive Award Opportunities

 

In 2021, the Talent and Compensation Committee established the annual nonequity incentive award opportunities under the Management Incentive Plan as a percentage of base salary. Target award opportunities were designed to provide for total cash compensation that rewards executives for driving our success and are competitive with general practices within our peer group. The 2021 potential nonequity incentive award payments, expressed as a percentage of base salary, were as follows:

 

Name   Threshold    

Threshold Incentive

Payment ($)

    Target    

Target Incentive

Payment ($)

    Maximum     Maximum Incentive
Payment ($)
 
H. Lynn Harton   50.0 %   $397,500     100.0 %   $795,000     150.0 %   $1,192,500  
Jefferson L. Harralson   32.5     138,125     65.0     276,250     97.5     414,375  
Richard W. Bradshaw   32.5     138,125     65.0     276,250     97.5     414,375  
Robert A. Edwards   30.0     120,000     60.0     240,000     90.0     360,000  
Melinda Davis Lux   27.5     96,250     55.0     192,500     82.5     288,750  

 

Threshold, target and maximum incentive payments in the chart above are based on 2021 base salaries.

 

2021 Nonequity Incentive Award Payouts

 

The payout percentage, based on our financial performance for each objective in 2021, were as follows:

 

          2021 Corporate Performance Levels          
           50%     100%      150%               
Performance Objective   Overall Weight    

Threshold

    Target    

Maximum

    2021 Actual     2021 Result  
Pre-Tax Pre-Provision Earnings per Share   20.0 %   $3.30     $3.40     $3.47     $3.50     30.00 %
Operating Earnings per Share   15.0     $2.14     $2.20     $2.25     $3.092     22.50 %
Net Charge-Offs / Total Loans   15.0     0.35 %   0.27 %   0.20 %   0.00 %   22.50 %
NPAs / Total Assets1   15.0     25th Percentile     50th Percentile     75th Percentile     75th Percentile     22.50 %
Operating Efficiency Ratio   20.0     57.00 %   54.30 %   52.30 %   53.83 %2   22.35 %
Customer Satisfaction Rating   15.0     95.50 %   96.50 %   97.50 %   97.20 %   20.25 %
                                  140.10 %
 

1 NPAs / Total Assets metric excludes restructured loans.

2 Both our operating earnings per share and operating efficiency ratio exclude merger-related and other charges. See reconciliation of non-GAAP measures related to GAAP financial measures on page 46 of United’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022.

 

 

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The following graphs summarize our 2021 performance with regard to select performance objectives compared with our peer group. The customer satisfaction rating operational measure is based on Customer Service Profiles for which peer comparison data is unavailable. See Role of the Talent and Compensation Committee: Market Benchmarking for our 2021 Compensation Peer Group. The source data for the following graphs is S&P Capital IQ Pro, which standardizes financial data to assist with comparisons across multiple companies. Consequently, the standardized data presented for us below may differ from our actual calculations, which do not take into account such standardizations. 

(GRAPHIC) 

 

 

1 NPAs / Total Assets metric excludes restructured loans.

2 Our operating efficiency ratio excludes merger-related and other charges. See reconciliation of non-GAAP measures related to GAAP financial measures on page 46 of United’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022.

 

 

Applying the payout level equal to 140.10% of base salary, our NEOs earned the following nonequity incentive awards in 2021:

 

Name   2021 Award ($)     Award as % of Target     Award as % of Base Salary  
H. Lynn Harton   $1,113,795     140.1 %   140.1 %
Jefferson L. Harralson   387,026     140.1     91.1  
Richard W. Bradshaw   387,026     140.1     91.1  
Robert A. Edwards   336,240     140.1     84.1  
Melinda Davis Lux   269,693     140.1     77.1  

 

Long-Term Equity Incentive Awards

 

Annual Awards

 

We believe that long-term equity incentive awards provide a competitive incentive opportunity for our NEOs, strengthens the alignment of executive pay with shareholder value creation and creates an additional link between pay and our performance (specifically, our return on average assets and total shareholder return). Under our long-term equity incentive award program, we are permitted to grant stock options, restricted stock, restricted stock units and other forms of equity-based compensation.

 

The Talent and Compensation Committee granted annual equity awards to our NEOs in September 2021. The Talent and Compensation Committee reserves the right to exercise discretion in determining the grant size of awards. Our 2021 awards were made in restricted stock units that consisted of at least 70% PRSUs and 30% TRSUs as shown in the table below.

 

 Name   Target Award as %
of Base Salary 
    2021 Annual
Equity Incentive
Award (PRSUs) (#) 
    Fair Value of 2021 Annual
Equity Incentive
Award (PRSUs) ($) 
    2021 Annual Equity
Incentive Award
(TRSUs) (#) 
    Fair Value of 2021
Annual Equity Incentive
Award (TRSUs) ($) 
 
H. Lynn Harton   115.0 %   21,234     $638,294     9,125     $274,298  
Jefferson L. Harralson   70.0     6,910     207,715     2,970     89,278  
Richard W. Bradshaw   70.0     6,910     207,715     2,970     89,278  
Robert A. Edwards   70.0     6,503     195,480     2,795     84,018  
Melinda Davis Lux   70.0     5,691     171,071     2,446     73,527  

 

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Annual PRSUs granted in 2021 will vest, if at all, in equal installments with 25% vesting on February 15 of each of the following years: 2023, 2024, 2025 and 2026. Vesting of the PRSUs on each vesting date will be based on our performance in the immediate calendar year before vesting (e.g., the number of awards that vest on February 15, 2023 will be determined by our performance for the 2022 calendar year).

 

The performance measure selected by the Talent and Compensation Committee for the annual PRSUs granted in 2021 is our return on average assets for the applicable performance period relative to the designated peer group of companies, as adjusted by the TSR modifier relative to the same designated peer group. Specifically, the number of PRSUs subject to vesting on each applicable vesting date will equal (a) a percentage between 0% to 150% determined based on

 

our return on average assets relative to designated peer companies for the applicable performance period, multiplied by the number of target PRSUs, adjusted by (b) the TSR modifier percentage relative to designated peer companies for the applicable performance period.

 

The following table summarizes the return on average assets and TSR modifier performance measures:

 

Return on Average Assets TSR Modifier
Return on average assets performance relative to designated peer group of companies for the performance period as a percentage of target PRSUs PRSUs determined based on return on average assets percentage for the performance period is adjusted +/- 25% based on relative total shareholder return

25th Percentile = Threshold (0% of Target) 

50th Percentile = Target (100% of Target) 

75th Percentile = Maximum (150% of Target) 

25th Percentile = Threshold (-25%) 

50th Percentile = Target (0%) 

75th Percentile = Maximum (+25%) 

The return on average assets percentage shall be interpolated between payout levels for performance between performance levels. The TSR modifier percentage shall be interpolated between payout levels for performance between performance levels.

 

The benchmark group of publicly-traded financial institutions against which the performance criteria will be measured relative to the 2021 PRSU equity incentive awards granted to the NEOs (the “2021 PRSU Peer Group”) include:

 

Company Name1 Ticker City State Total Assets 2020Y ($000)
Ameris Bancorp ABCB Atlanta GA $ 20,438,638
Atlantic Union Bkshs Corp. AUB Richmond VA 19,628,449
Cadence Bank CADE Tupelo MS 24,081,194
Commerce Bancshares Inc. CBSH Kansas City MO 32,922,974
First Busey Corp. BUSE Champaign IL 10,544,047
First Financial Bancorp. FFBC Cincinnati OH 15,973,134
First Financial Bankshares FFIN Abilene TX 10,904,500
First Merchants Corp. FRME Muncie IN 14,067,210
Fulton Financial Corp. FULT Lancaster PA 25,906,733
Hancock Whitney Corp. HWC Gulfport MS 33,638,602
Heartland Financial USA Inc. HTLF Dubuque IA 17,908,339
Independent Bk Group Inc. IBTX McKinney TX 17,753,476
Old National Bancorp ONB Evansville IN 22,960,622
Pinnacle Financial Partners PNFP Nashville TN 34,932,860
Prosperity Bancshares Inc. PB Houston TX 34,059,275
Renasant Corp. RNST Tupelo MS 14,929,612
Sandy Spring Bancorp Inc. SASR Olney MD 12,798,429
Simmons First National Corp. SFNC Pine Bluff AR 22,359,752
SouthState Corp. SSB Winter Haven FL 37,789,873
TowneBank TOWN Portsmouth VA 14,626,444
Trustmark Corp. TRMK Jackson MS 16,551,840
UMB Financial Corp. UMBF Kansas City MO 33,127,504
United Bankshares Inc. UBSI Charleston WV 26,184,247
WesBanco Inc. WSBC Wheeling WV 16,425,610

 

1 The following publicly-traded financial institutions were removed from the 2020 PRSU Peer Group and were, therefore, not included in the 2021 PRSU Peer Group: First Commonwealth Financial Corp., Park National Corp., S&T Bancorp, Inc. – as a result of each falling below the asset floor established for the 2021 PRSU Peer Group.

The following publicly-traded financial institutions were added to the 2021 PRSU Peer Group when compared with the 2020 PRSU Peer Group: Commerce Bancshares, Inc. – as a result of overcoming a number of previous minor concerns and being positioned firmly in the peer asset range; Hancock Whitney Corp. and Prosperity Bancshares, Inc. – as a result of UCBI’s growth positioning it in both Hancock Whitney Corp.’s and Prosperity Bancshares, Inc.’s asset range; Independence Bank Group, Inc. – as a result of a previously announced acquisition falling through (in response to the previous announcement Independence Bank Group, Inc. had been removed from the PRSU Peer Group).

 

 

 

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The Talent and Compensation Committee may make appropriate adjustments to this group of peer companies, including retroactively to the first day of the performance period, in the event of any unusual or nonrecurring events that impact such peer companies during the performance period. Peers that are acquired will be excluded from vesting determinations in future years. Annual TRSUs granted in 2021 will vest in equal installments with 25% vesting on November 15, 2022 and then on August 15 of 2023, 2024 and 2025 assuming the executives remain employed with us, subject to certain exceptions.

 

Perquisites and Other Compensation

 

We provide executive officers with perquisites and other personal benefits that the Company and our Talent and Compensation Committee believe are reasonable and consistent with its overall compensation program. These perquisites include car allowances and payment of club dues for certain of our executive officers. Our Talent and Compensation Committee periodically reviews the levels and appropriateness of perquisites and other personal benefits provided to executive officers. The Committee believes that the perquisites and other personal benefits further the goals of the Company and are not material with respect to the overall compensation of our executive officers.

 

Retirement and Other Benefits

 

401(k) Plan

 

Our employees, including our executive officers, are eligible to participate in our 401(k) Plan for which we provide matching contributions. Our matching contributions currently are 100% of employee deferrals up to 5% of eligible compensation.

 

Deferred Compensation Plan

 

Select members of senior management and certain other highly compensated employees, including our executive officers, are eligible to participate in our nonqualified Deferred Compensation Plan (“DCP”). Pursuant to the DCP, eligible employees can defer certain compensation on a pre-tax basis. The DCP provides for the deferral of up to 75% of annual base salary and up to 100% of annual cash bonus payments or nonequity incentive awards and other specified benefits to certain key employees. The DCP also allows for employer matching contributions for employee contributions that would have been paid under our tax-qualified 401(k) plan if such matching contributions would otherwise exceed the maximum allowable amounts under the 401(k) Plan. Our matching contributions currently are 100% of employee deferrals up to 5% of eligible compensation. In addition, the DCP provides for the deferral of up to 100% of director fees for service by a nonemployee director on our Board and for service by select nonemployee directors on our community bank boards.

 

Participants are 100% vested in their DCP contributions including earnings or losses thereon. Company contributions, including earnings and losses thereon, vest over a three-year period.

 

When a participant retires or becomes disabled, we will pay the participant his or her vested benefits as elected by the participant, generally in a lump sum or in annual installments over a period of up to ten years. A participant may also elect to receive scheduled in-service distributions of his or her deferral account during employment in a lump sum or in annual installments over a period of up to five years. All payments are taxable to the participants. See Nonqualified Deferred Compensation for additional information about benefits provided to the NEOs under the DCP.

 

Modified Retirement Plan

 

Our Modified Retirement Plan provides annual benefits (paid monthly) that are generally paid at normal retirement in the form of a 100% survivor annuity, are calculated based on a participant’s seniority and position and generally range from 20% to 30% of the participant’s base salary. Normal retirement is defined under the Modified Retirement Plan as attainment of age 65 and completion of at least five years of service.

 

Beginning in 2020, the Board determined that it will not offer participation in the Modified Retirement Plan to any employee of United who is not already a participant nor will it enhance existing benefits for any current participants.

 

See Pension Benefits for additional information about benefits provided to the NEOs under the Modified Retirement Plan.

 

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Other Post-Employment Payments and Severance Benefits

 

We have change-in-control severance agreements with each of our executive officers. These severance agreements, among other things, provide for payments to each executive upon a change in control and termination of employment in certain circumstances. We believe that reasonable severance benefits are appropriate to protect executives against circumstances over which they have no control and as consideration for restrictive covenants and to facilitate clawback rights. A change in control, by itself (“single trigger”), does not trigger any severance provision applicable to our executive officers under the severance agreements. Equity awards granted to our executive officers do not provide for single trigger vesting acceleration but rather require a termination event within a certain period of time following a change in control to accelerate vesting of such equity awards. See Potential Payouts Upon Termination or Change of Control for additional information. Certain payments (including those that might be accelerated under the Modified Retirement Plan) will be made upon a termination of employment or a change of control.

 

The Talent and Compensation Committee believes such terms are standard for a financial institution in the markets in which we operate.

 

Clawback Policy

 

Our Board has adopted a policy that allows the Board to clawback compensation paid or awarded to an executive officer or employee in the event of a material restatement of our financial results, including the right to clawback cash incentives and equity awards. Consideration will be given to the circumstances that caused the restatement, issues of accountability for those who bore responsibility for the events, and whether anyone responsible engaged in misconduct, which includes violation of United’s Code of Conduct or policies or any act or failure to act that could reasonably be expected to cause financial or reputational harm to United.

 

Stock Ownership Guidelines

 

To directly align the interests of executive officers with the interests of our shareholders, our Board adopted a policy with guidance for each executive officer to acquire and maintain the following minimum ownership of United common stock within five years of becoming an executive officer:

 

Executive Minimum Ownership Guidelines
Chief Executive Officer Own Company stock with a value of at least 3 times his base annual salary
Executive Officers (other than CEO) Own Company stock with a value of at least 2 times his or her base annual salary

 

All of the NEOs and other executive officers have met or are on track to meet these targets within the five-year-period.

 

Deductibility of Executive Compensation

 

Section 162(m) of the Code limits the U.S. federal income tax deduction for compensation paid to our Chief Executive Officer, Chief Financial Officer and certain other highly compensated executive officers (including, among others, our next three other most highly compensated executive officers as of the end of the calendar year) to a maximum U.S. federal income tax deduction that we may receive for annual compensation paid to any officer covered by Code Section 162(m) to $1,000,000 per officer. To the extent that the aggregate amount of any covered officer’s salary, bonus, amounts realized from option exercises and vesting of restricted stock units or other equity awards and certain other compensation amounts that are recognized as taxable income by the officer exceeds $1,000,000 in any year, we are not entitled to a U.S. federal income tax deduction for the amount over $1,000,000 in that year. Although the Talent and Compensation Committee has not adopted a formal policy regarding tax deductibility of compensation paid to our executive officers, it continues to view the tax deductibility of executive compensation as one of many factors to be considered in the context of its overall compensation philosophy. Accordingly, the Talent and Compensation Committee reserves the right to approve compensation that may not be deductible in situations it deems appropriate.

 

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Talent and Compensation Committee Report

 

The Talent and Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis (“CD&A”) required by Item 402(b) of Regulation S-K and, based on this review and discussion, the Talent and Compensation Committee has recommended to the Board that the CD&A be included in this Proxy Statement.

 

This report has been furnished by the Talent and Compensation Committee of the Board of Directors:

 

 

Jennifer K. Mann, Chair

James P. Clements

Kenneth L. Daniels

Lance F. Drummond

David C. Shaver

  

The above Talent and Compensation Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other United filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent United specifically incorporates this report by reference therein.

 

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Summary Compensation Table

 

The following table sets forth the compensation paid to our NEOs during the past three years. 

 

Name and Principal Position1 Year Salary ($)3 Bonus ($) Stock Awards ($)4 Non-Equity Incentive Plan Compensation ($)5 Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($)6 All Other Compensation ($)7 Total ($)
H. Lynn Harton 2021 $ 795,000 - $ 912,592 $ 1,113,795 $ 118,749 $ 75,310 $ 3,015,446
President & Chief                
Executive Officer 2020 775,000 - 891,586 755,250 947,467 73,533 3,442,836
                 
  2019 752,083 - 751,814 1,143,125 969,075 68,993 3,685,090
                 
Jefferson L. Harralson 2021 425,000 - 296,993 387,026 80,395 44,521 1,233,935
Executive Vice President &                
Chief Financial Officer 2020 420,000 - 294,123 262,438 137,727 44,250 1,158,538
                 
  2019 408,333 - 287,711 402,675 116,463 43,083 1,258,265
                 
Richard W. Bradshaw 2021 425,000 - 296,993 387,026 87,809 42,814 1,239,642
Executive Vice President &                
Chief Banking Officer 2020 385,000 - 269,624 262,438 232,609 38,265 1,187,936
               
  2019 371,666 - 225,568 312,331 346,782 45,940 1,302,287
                 
Robert A. Edwards 2021 400,000 - 279,498 336,240 69,239 32,000 1,116,977
Executive Vice President &                
Chief Risk Officer 2020 385,000 - 269,624 228,000 157,233 31,250 1,071,107
               
  2019 373,750 - 225,568 312,331 267,526 40,027 1,219,202
                 
Melinda Davis Lux2 2021 350,000 75,0009 244,598 269,693 -10 17,917 957,208
Executive Vice President &                
General Counsel and 2020    272,0838 -9 295,098 182,875 -10 - 750,056
Corporate Secretary                

1 Reflects current principal positions.

2 Ms. Davis Lux joined United in March 2020.

3 Includes any amounts voluntarily deferred under our Deferred Compensation Plan. See Nonqualified Deferred Compensation.

4 Amounts shown reflect the aggregate grant date fair value of restricted stock units computed in accordance with FASB ASC Topic 718. See Note 16 of our annual consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022 for a discussion of valuation assumptions. Awards that are subject to performance conditions are included in the Summary Compensation Table assuming that target level performance conditions will be achieved. The following table summarizes the value of the awards subject to performance conditions at the grant date assuming that the highest level of performance conditions is achieved:

Name Grant Date Fair Value of Stock Awards: Highest Level of Performance Conditions Achieved ($)
H. Lynn Harton $ 1,196,809
Jefferson L. Harralson 389,457
Richard W. Bradshaw 389,457
Robert A. Edwards 366,522
Melinda Davis Lux 320,770

5 Represents amount awarded under our Management Incentive Plan. See Executive Compensation: Compensation Discussion and Analysis: 2021 Executive Compensation Components: Annual Nonequity Incentive Awards for additional information regarding amounts earned in 2021.
6 Represents the change in the actuarial present value of the NEO’s accumulated benefits under the Modified Retirement Plan. For this purpose, in accordance with SEC rules, the present value was determined assuming no preretirement death, disability or termination and that benefits commence at the later of current age or the earliest age at which unreduced benefits are available. Other assumptions are those applicable for valuing pension benefits for purposes of our financial statements, including a discount rate of 2.90% and postretirement mortality rates based on aggregate 2012 base rates from the PRI-2012 mortality study, with white collar adjustment projected generationally using Scale MP-2021. See Compensation Discussion and Analysis: 2021 Executive Compensation Components: Retirement and Other Benefits and Pension Benefits for additional information. The 2021 change in actuarial present value reflects an additional year of service rendered by participants, age increases reflecting that each participant is one year closer to retirement and changes in key actuarial assumptions, principally, discount rate assumptions and mortality assumptions. Our Deferred Compensation Plan does not credit above-market or preferential earnings.
7 The amounts in this column include the following for 2021:

Name Auto Allowance ($) Club Membership Dues ($) Employer Contributions to the Deferred Compensation Plan ($) Employer Contributions to the 401(k) Plan ($) Total ($)
H. Lynn Harton $ 15,000 $ 25,313 $ 25,250 $ 9,747 $ 75,310
Jefferson L. Harralson 15,000 21,000 6,750 1,771 44,521
Richard W. Bradshaw 12,000 9,564 6,750 14,500 42,814
Robert A. Edwards 12,000 - 5,500 14,500 32,000
Melinda Davis Lux 10,000 - 3,000 4,917 17,917

8 Ms. Davis Lux’s 2020 salary represents the amount of base salary paid in 2020 since her hire in March 2020.
9 Ms. Davis Lux’s employment offer included a one-time hiring bonus of $75,000 that became vested and was earned during the first quarter of 2021. Ms. Davis Lux elected to defer this payment under our Deferred Compensation Plan.
10 Beginning in 2020, the Board determined that it will not offer participation in the Modified Retirement Plan to any employee of United who was not already a participant. As a result, Ms. Davis Lux was not offered participation in the Modified Retirement Plan upon employment.

 

 
48

 

Grant of Plan-Based Awards

 

The following table summarizes each NEO’s 2021 nonequity incentive opportunity under Estimated Future Payouts Under Nonequity Incentive Plan Awards. Actual annual nonequity incentives earned in 2021 are shown in the Summary Compensation Table. See Compensation Discussion and Analysis: 2021 Executive Compensation Components: Annual Nonequity Incentive Awards for additional information.

 

The following table also shows information regarding equity incentives granted to our NEOs during 2021. Awards summarized under Estimated Future Payouts Under Equity Incentive Plan Awards include the threshold, target and maximum number of PRSUs which could be earned by each NEO based upon the level of achievement of the applicable performance measures. The awards listed under All Other Stock Awards include TRSUs that vest over time based upon the applicable NEO’s continued employment with United. See Compensation Discussion and Analysis: 2021 Executive Compensation Components: Long-Term Equity Incentive Awards for additional information. Columns have been omitted from this table because they were not applicable.

 

    Estimated Future Payouts Under Nonequity Incentive Plan Awards Estimated Future Payouts under Equity Incentive Plan Awards1    
Name Grant Date Threshold ($) Target ($) Maximum ($) Threshold (#) Target (#) Maximum (#) All Other Stock Awards: Number of Shares of Stock or Units (#)2 Grant Date Fair Value of Stock Awards ($)3
H. Lynn Harton   $ 397,500 $ 795,000 $ 1,192,500          
  9/1/2021       - 21,234 39,814   $ 638,294
  9/1/2021             9,125 274,298
Jefferson L. Harralson   138,125 276,250 414,375          
  9/1/2021       - 6,910 12,956   207,715
  9/1/2021             2,970 89,278
Richard W. Bradshaw   138,125 276,250 414,375          
  9/1/2021       - 6,910 12,956   207,715
  9/1/2021             2,970 89,278
Robert A. Edwards   120,000 240,000 360,000          
  9/1/2021       - 6,503 12,193   195,480
  9/1/2021             2,795 84,018
Melinda Davis Lux   96,250 192,500 288,750          
  9/1/2021       - 5,691 10,671   171.071
  9/1/2021             2,446 73,527

 

1 Represents the awards of PRSUs that are subject to the achievement of performance conditions in equal installments with 25% vesting on February 15 of each of the following years: 2023, 2024, 2025 and 2026 based on achievement of the prior year’s performance.

2 Represents the number of TRSUs that will vest in equal installments with 25% vesting on November 15, 2022, and then on August 15 of each of the following years: 2023, 2024 and 2025, assuming the executives remain employed with us, subject to certain exceptions.

3 This amount represents the aggregate grant date fair value of each equity award computed in accordance with FASB ASC Topic 718. The grant date fair value of the PRSUs that were issued on September 1, 2021 was estimated at the target performance level. See Note 16 of our annual consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022, for a discussion of valuation assumptions.

  

 
49

 

Outstanding Equity Awards at Fiscal Year-End

 

The following table sets forth, for each NEO, the number and value of unvested restricted stock unit awards as of December 31, 2021. No NEOs had any stock options exercisable or unexercisable as of December 31, 2021. See Compensation Discussion and Analysis: 2021 Executive Compensation Components: Long-Term Equity Incentive Awards for additional information regarding our 2021 equity awards. Columns have been omitted from this table because they were not applicable. 

 

    Stock Awards
        Equity Incentive Plan Awards
Name Grant Date Number of Shares or Units of Stock that have not Vested (#) Market Value of Shares or Units of Stock that have not Vested ($)1 Number of Unearned Shares, Units or Other Rights that have not Vested (#)2 Market or Payout Value of Unearned Shares, Units or Other Rights that have not Vested ($)1
H. Lynn Harton 9/15/2017 5,757 3 $ 206,907 -    -
  9/1/2018 7,981 4 286,837 8,126 8 $ 292,048
  9/2/2019 11,472 5 412,304 18,702 8 672,150
  9/1/2020 19,567 6 703,238 42,102 8 1,513,146
  12/1/2020 4,684 7 168,343 -    -
  9/1/2021 9,125 7 327,953 39,814 8 1,430,915
Jefferson L. Harralson 9/15/2017 2,579 3 92,689 -    -
  9/1/2018 2,979 4 107,065 3,034 8 109,042
  9/2/2019 4,389 5 157,741 7,157 8 257,223
  9/1/2020 7,424 6 266,819 15,971 8 573,998
  9/1/2021 2,970 7 106,742 12,956 8