Morris Tharp
About Morris A. Tharp
Morris A. Tharp, age 85, is Chairman of the Board of Sierra Bancorp and Bank of the Sierra, a native of Porterville, and President/Owner of E.M. Tharp, Inc. (truck sales and repair). He has served on the bank’s board since 1977 and the holding company’s board since 2000; his current term expires in 2026. The Board has determined he is independent under Nasdaq rules.
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Sierra Bancorp and Bank of the Sierra | Chairman of the Board | Since formations: Bank 1977; Holding Co. 2000; current term to 2026 | Chairs Nominating & Governance; serves on Audit and Compensation; provides independent leadership as Chair. |
| E.M. Tharp, Inc. | President & Owner | Not disclosed; purchased family business, now sole owner | Small-business leadership and operations expertise; community involvement. |
External Roles
No other public-company directorships disclosed in the proxy; community involvement noted without specifics.
Board Governance
- Committee assignments and chair roles: Chairs Nominating & Governance; member, Audit; member, Compensation. Audit Committee met 13x in 2024; Compensation 3x; Nominating & Governance 1x.
- Independence and leadership: Board determined all directors other than the CEO are independent; Sierra Bancorp separates the independent Chair from the CEO. Directors meet regularly in executive session.
- Attendance: Board held 8 meetings in 2024; each incumbent director attended at least 75% of board and applicable committee meetings.
- Insider trading, hedging and pledging: Directors/officers prohibited from short sales, hedging, and pledging Company securities or holding them in margin accounts.
Fixed Compensation
| Component | Amount (2024) | Notes |
|---|---|---|
| Fees Earned or Paid in Cash | $107,875 | Includes annual director retainer and per-meeting fees; Tharp also receives Board Chair retainer. |
| Board Chair Retainer | $20,000 | Additional annual retainer for Board Chair. |
| Audit Committee Chair Retainer | — | Not applicable to Tharp; Audit Chair retainer is $10,000 for the committee chair. |
| Vice Chair Retainer | — | Not applicable to Tharp. |
| Per-Meeting Fees (Board/Committee) | $1,250 (board); $1,000 (committee); +$625 per board meeting for Chair; +$500 per committee meeting for committee chairs | Standard rates in 2024. |
| All Other Compensation | $12,198 | Cash bonuses reimbursing imputed value and tax costs of split-dollar life insurance benefits. |
| Total | $160,071 | Sum of cash and other compensation. |
Performance Compensation
| Grant Type | Grant Date | Shares | Grant-Date Fair Value | Vesting | Terms |
|---|---|---|---|---|---|
| Restricted Stock (time-based) | Nov 21, 2024 | 1,261 | $39,999 | Nov 21, 2025 | One-year time-based vest; director equity under 2023 Plan (amended to prohibit repricing). |
No performance metrics apply to director equity; director grants in 2024 were time-based RS and not tied to financial or ESG performance.
Other Directorships & Interlocks
| Organization | Role | Overlap/Interlock |
|---|---|---|
| None disclosed | — | No public-company interlocks disclosed. |
- Compensation Committee interlocks: None of the Compensation Committee members (including Tharp) were officers/employees in the past three fiscal years; no cross-committee interlocks with other issuers.
Expertise & Qualifications
- Founding and legacy governance: Original proponent of the Bank; decades of bank board experience and accumulated operational knowledge.
- Small business and industry: Owner-operator background in manufacturing/retail truck sales and repair; management expertise; local market knowledge.
- Community ties: Active in local community; aligns with Board’s emphasis on local market representation.
Equity Ownership
| Metric | Value | Notes |
|---|---|---|
| Beneficial Ownership (shares) | 447,569 | Includes various forms of beneficial ownership per proxy definitions. |
| Vested Option Shares (within 60 days) | 20,000 | Options vested/vesting within 60 days of March 24, 2025. |
| Restricted Stock (unvested) | 1,261 | Time-based restricted stock outstanding as of record date. |
| Shares as Trustee (no dispositive power) | 18,115 | Held as trustee for grandchildren of another director; sole voting, no dispositive power. |
| Ownership as % of Shares Outstanding | 3.38% | Based on outstanding shares plus vested options per proxy method. |
| Ownership Guidelines | Minimum $100,000 for non-employee directors; time to comply by the later of Feb 15, 2027 or three years from appointment. Unvested RS counts. | Policy adopted Feb 2024; includes one-year post-vesting hold (net of taxes). |
Governance Assessment
-
Strengths
- Independent Chair with decades of institutional knowledge; separate from CEO role.
- Active roles on core committees (Audit, Compensation) and chairs Governance; enhances board oversight and nomination quality.
- Formal restrictions on hedging/pledging; director ownership guidelines instituted to enhance alignment.
- Documented board and committee activity levels; all directors ≥75% attendance threshold met in 2024.
-
Potential risks and red flags
- Very long tenure and advanced age (85) can pose entrenchment/performance oversight risk if not balanced by refreshment; board reduced size in 2024 but retains multiple long-tenured directors.
- Director Retirement Plan provides $50,000 per year for 10 years to Tharp (and Berra), plus split-dollar life insurance benefits (death benefit equal to accrued liability ~$393,220); legacy arrangements may be viewed as shareholder-unfriendly by some investors.
- Trustee holdings for grandchildren of another director indicate familial ties; while not a related-party transaction per se, it introduces potential perceived interlocks.
- Related-party banking relationships exist (ordinary course loans with directors/affiliates); Board states market terms and normal risk, but investors should monitor credit exposures.
-
Additional notes
- Compensation Committee asserts no pay practices encourage excessive risk; advisory say-on-pay held annually (executive pay).
Related Party and Director Benefits Detail
| Program | Terms (Director-Specific) | Notes |
|---|---|---|
| Director Retirement Plan | $50,000 annually for 10 years commencing at retirement/disability/change in control; death benefit equals accrued liability ($393,220) before benefit commencement; fully accrued/vested for eligible directors Tharp and Berra. | Funded via company-owned life insurance; split-dollar benefit for Berra from 2003 noted; Tharp receives related reimbursements in “All Other Compensation.” |
| Ordinary Course Banking | Loans/commitments to directors and associated companies on market terms; no unfavorable features per Board. | Ongoing relationships; monitor concentrations and credit quality. |
Fixed Compensation (Director Mix for 2024)
| Category | Amount | Mix |
|---|---|---|
| Cash (Fees & Retainers) | $107,875 | Calculated mix from disclosed amounts |
| Equity (Grant-Date RS Fair Value) | $39,999 | Calculated mix from disclosed amounts |
| Other (Split-dollar reimbursements) | $12,198 | Calculated mix from disclosed amounts |
| Total | $160,071 | Calculated mix from disclosed amounts |
Performance Compensation (Director Equity Mechanics)
| Metric | 2024 Director Grant Parameters | Vesting/Performance |
|---|---|---|
| Shares | 1,261 RS | Vests 1 year; time-based only (no performance metrics). |
| Grant-Date Value | $31.72 per share; $39,999 total | Grant under 2023 Plan; repricing prohibited. |
Attendance & Engagement
| Metric | 2024 |
|---|---|
| Board meetings held | 8 |
| Director attendance policy | Encourage attendance at Annual Meeting; ≥75% attendance achieved by all incumbent directors in 2024. |
| Executive sessions | Regular executive sessions without management. |
Committee Assignments (2024)
| Committee | Role | Meetings in 2024 |
|---|---|---|
| Nominating & Governance | Chair | 1 |
| Audit | Member | 13 |
| Compensation | Member | 3 |
Summary View for Investors
- Tharp’s independent chairmanship and deep institutional knowledge support board effectiveness; his leadership of nominations/governance is a positive for director pipeline and independence oversight.
- Alignment is strengthened by ownership size and equity grants; hedging/pledging prohibitions and new ownership guidelines are positives.
- Watch legacy director benefits (retirement plan/split-dollar) and familial trustee relationships for optics and potential conflicts; ensure ongoing board refreshment mitigates entrenchment risk.
- Ordinary-course banking relationships should remain on market terms; monitor disclosures and credit exposures.