Gary R. Mills
About Gary R. Mills
Gary R. Mills is President of First Community Bankshares, Inc. and the Chief Executive Officer and President of First Community Bank, with more than 30 years in financial services. He is a Certified Public Accountant with a BS in Business Administration (Accounting) from Concord College (now University) and has served as a director of the Corporation since 2016; age 57 as of the 2025 proxy . Corporate pay-versus-performance data show FCBC’s five-year TSR rose to $161.84 per $100 invested (peer group $120.02), with Net Income of $51.6 million and ROAE of 10.03% in 2024, indicating alignment of incentive design with shareholder outcomes . Directors Stafford and Mills are not independent due to executive roles; the Board mitigates combined CEO/Chairman risk through a Lead Independent Director and separated leadership at the bank level (Mills as Bank CEO) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| First Community Bank | Market President, Princeton Division | 1998–2005 | Local market leadership, lending and growth execution |
| First Community Bank | Senior Vice President, Credit Administration | 2005–2006 | Credit policy and risk oversight |
| First Community Bank | Chief Credit Officer | 2007–until appointment as Bank CEO (date not disclosed) | Enterprise credit quality and risk management |
| First Community Bankshares, Inc. | President of the Corporation | Aug 31, 2013–present | Corporate leadership; compensation proposals to CRC jointly with CEO |
| First Community Bank | Chief Executive Officer and President | Current | Primary operating entity leadership; performance management |
External Roles
- The proxy cites “extensive civic and community involvement,” but does not list specific external board roles for Mr. Mills; none disclosed beyond service on the Corporation’s and bank boards .
Fixed Compensation
Multi-year reported compensation (Summary Compensation Table):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $610,375 | $635,827 | $649,200 |
| Stock Awards ($, grant-date fair value) | $180,015 | $194,684 | $194,695 |
| Non-Equity Incentive Plan Compensation ($) | $348,862 | $245,918 | $200,895 |
| Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | $26,774 | $107,091 | $0 (decrease of $22,141 in SERP present value) |
| All Other Compensation ($) | $94,840 | $125,773 | $112,933 |
| Total ($) | $1,260,866 | $1,309,293 | $1,157,723 |
2024 All Other Compensation components:
| Component | 2024 Amount |
|---|---|
| Retirement Plan Matching | $61,722 |
| Executive Life Insurance Premium | $27,768 |
| Perquisites (auto and club dues) | $23,443 (auto: $17,811; country club: $5,632) |
| Total All Other Compensation | $112,933 |
Notes:
- 2024 salary plus bonus comprised 75% of Mills’s total compensation, consistent with FCBC’s emphasis on variable pay within prudent risk parameters .
Performance Compensation
Annual Cash Incentive (ACI) design and outcomes:
| Aspect | Details |
|---|---|
| Plan Design | Baseline annual incentive tied to a primary financial return metric (core ROAE) set vs peer median; baseline equals 40% of base compensation at target, 20% at threshold, 80% at maximum; KPIs with threshold 85% and maximum 115% adjust payout; CRC can reduce/eliminate awards; no increases via discretion |
| 2024 ACI Opportunity (set Feb 27, 2024) | Threshold $36,793; Target $259,560; Maximum $596,988 (amounts scale with base) |
| 2023 Performance → Paid in 2024 | Core ROAE achieved: 10.70%, baseline factor 29.50%; KPIs (core ROAA, core Net Income, Efficiency) equally weighted; KPI results yielded 30.96% of annualized base compensation payout |
| 2024 Performance → Paid in 2025 | Aon-assisted metric/target modifications; cash award paid in 2025 to Mills: $421,359 |
Long-Term Equity (PRSU) awards and vesting:
| Grant Date | Units Granted | Vesting | Performance Metric | Grant-Date Fair Value |
|---|---|---|---|---|
| May 24, 2022 | 6,436 | Cliff after 3 years | 3-year rolling ROAE ≥ 8.5% | Market value cited at 12/31/24: $267,995 |
| May 23, 2023 | 7,394 | Cliff after 3 years | 3-year rolling ROAE ≥ 8.5% | Market value at 12/31/24: $307,886 |
| May 29, 2024 | 5,728 | Cliff after 3 years | 3-year rolling ROAE ≥ 8.5% | Grant-date fair value $194,695 (price $33.99 on 5/28/24) |
- Options/Stock activity in 2024: Mills reported no option exercises and no stock vesting in 2024, reducing near-term selling pressure from awards .
Equity Ownership & Alignment
Beneficial ownership and outstanding awards (as of Feb 25, 2025 and Dec 31, 2024):
| Item | Amount | Notes |
|---|---|---|
| Beneficially owned shares | 81,426 | Less than 1% outstanding |
| Options exercisable | 865 @ $24.65 (exp 02/05/35); 3,025 @ $29.15 (exp 02/05/35); 15,799 @ $33.00 (exp 03/19/31); all vested | |
| Unvested PRSUs outstanding | 6,436 (2022 grant); 7,394 (2023 grant); 5,728 (2024 grant) | |
| Market value of PRSUs at 12/31/24 | $267,995 (2022); $307,886 (2023); $238,514 (2024) | Based on $41.64 price at 12/31/24 |
| Stock ownership guidelines | 3.5x base compensation requirement applies to Chief Executive Officers (Corp and Bank); hold-until-compliant rule; limited sales to cover taxes/exercise cost; prohibited hedging, margin accounts, short selling, and derivatives | |
| Pledging | No explicit pledging disclosure; hedging and margin accounts prohibited |
Say-on-pay and governance practices:
- 2024 Say-on-Pay approval ~97%, signaling strong investor support for pay design .
- Clawback policy applies to equity awards; no single-trigger change-in-control cash payments; no tax gross-ups; no option repricing .
Employment Terms
Retirement, deferred compensation, and potential payments:
| Plan / Item | 2024 Amount / Balance | Key Terms |
|---|---|---|
| SERP present value | $517,662 | SERP frozen to new participants since 12/31/21; benefit accrued/vested as of 12/31/21; payable at/after age 62 |
| Non-Qualified Deferred Compensation – Executive contributions | $57,033 | 409A-compliant deferrals; distribution elections at enrollment; Qualifying Distribution Events include separation, CIC, emergency, disability, death, scheduled in-service |
| Non-Qualified Deferred Compensation – Corporation contributions | $38,622 | Corporate match discretionary; amounts tied to prior-year deferrals |
| Non-Qualified Deferred Compensation – Aggregate earnings | $141,594 | Based on participant-directed investments; no guaranteed return |
| Non-Qualified Deferred Compensation – Aggregate balance | $1,371,095 | Includes combined balances from prior WRAP plan |
Potential incremental value transfer under termination scenarios (as of 12/31/24):
| Scenario | Salary & Benefits | Accel. RSUs/Options | Non-Qualified Deferred Comp | SERP | Exec Life Ins | Total |
|---|---|---|---|---|---|---|
| Early retirement | $0 | $0 | $1,371,095 | $53,598 | $85,772 | $1,510,465 |
| Retirement | $0 | $0 | $1,371,095 | $61,844 | $85,772 | $1,518,711 |
| Termination for Cause | $0 | $0 | $1,371,095 | $0 | $85,772 | $1,456,867 |
| Termination without Cause | $990,929 | $0 | $1,371,095 | $61,844 | $85,772 | $2,509,640 |
| Change-in-Control termination | $1,946,700 | $814,395 | $1,371,095 | $539,803 | $85,772 | $4,757,765 |
| Disability | $0 | $708,784 | $1,371,095 | $61,844 | $85,772 | $2,227,495 |
| Death | $0 | $708,784 | $1,371,095 | $61,844 | $1,545,000 | $3,686,723 |
Key provisions:
- No single-trigger cash severance; equity accelerates upon CIC only if successor fails to assume/replace awards; RSUs typically forfeited on individual termination/retirement unless CRC prorates .
Board Governance
- Board service: Director of the Corporation since 2016; Class of 2026; also serves on the Board of the bank .
- Committee roles: Member, Executive Committee (Board-delegated powers between meetings) .
- Independence: Not independent solely due to executive status; independent oversight via ACER, CRC, and GNC committees .
- Attendance: In 2024, Board held 9 regular and 2 special meetings; all directors attended >75% of Board and applicable committee meetings; independent directors met in executive session twice .
- Board leadership: CEO/Chairman roles combined at the Corporation, mitigated by Mills’s separate leadership as Bank CEO and a Lead Independent Director (Elmore) who chairs independent sessions and ALCO process .
Director compensation and dual-role implications:
- Non-management directors received cash retainers ($33,541), committee fees, and RSU grants vesting in one year; these apply to non-employee directors. Employee directors (e.g., Mills) are compensated as executives; non-management program is shown separately and does not list Mills among recipients . Dual roles raise independence and oversight considerations addressed via committee independence and LID structure .
Compensation Structure Analysis
- Mix shift and risk balance: 100% of long-term incentives are performance-based PRSUs with a three-year cliff vest tied to ROAE ≥ 8.5%, reinforcing multi-year alignment and discouraging excessive risk-taking .
- Annual incentive calibration: Baseline target set at peer median performance (core ROAE) with KPI overlays and strict thresholds/maximums; CRC retains only downward discretion; 2023 performance produced a 30.96% of base payout in 2024, consistent with plan calibration .
- Governance features: Clawback policy; no tax gross-ups; no single-trigger CIC cash payments; prohibitions on hedging, margin accounts, short selling, and derivatives; strong say-on-pay support (97%) .
Performance & Track Record
Pay versus performance highlights:
| Year | FCBC TSR (year-end $100 base) | Net Income ($MM) | ROAE (%) |
|---|---|---|---|
| 2020 | 72.83 | 35.93 | 8.54 |
| 2021 | 116.90 | 51.17 | 11.96 |
| 2022 | 122.88 | 46.66 | 11.04 |
| 2023 | 141.73 | 48.02 | 10.02 |
| 2024 | 161.84 | 51.60 | 10.03 |
Other execution markers:
- Fifteenth consecutive year of dividend increases and 257,294 shares repurchased (~1.40% of outstanding), supporting capital return discipline .
Equity Ownership & Alignment – Additional Detail
- Stock ownership guidelines require 3.5x base comp for Chief Executive Officers; hold-until-compliant rule with narrow exceptions for taxes/exercise cost; hedging/margin accounts prohibited; compliance status for Mr. Mills not disclosed .
- 2024 option grant vesting status: 11/3/2021 options fully vested on 11/3/2024; Mills’ option positions are fully vested where shown as exercisable .
Employment Terms – Additional Detail
- Deferred compensation plan is 409A-compliant; participants elect form of payment at enrollment; distribution events include separation from service, CIC, emergency, disability, death, and scheduled in-service distributions .
- Directors’ SERP and life insurance arrangements pertain to non-management directors; executive SERP frozen to new participants since 2021 and pays only accrued/vested benefits at/after age 62 .
Risk Indicators & Red Flags
- Structural governance risk: Combined CEO/Chairman at the Corporation offset by Bank CEO role and Lead Independent Director; Mills is not independent due to executive role .
- Favorable policies: No single-trigger cash severance; no tax gross-ups; no option repricing; equity clawbacks; prohibitions on hedging/margin accounts .
- Insider selling pressure: No option exercises or stock vesting by Mills in 2024; PRSUs cliff vesting in 2025–2027 can create event-driven supply depending on performance and CRC decisions .
Compensation Peer Group (Benchmarking)
- 2024 peer group selected by Aon emphasizes revenue scale ($80–$330MM) across comparable banks; FCBC positioned near median revenue; used to calibrate ROAE target ranges and incentive baselines .
Say-on-Pay & Shareholder Feedback
- 2024 advisory vote approval ~97%; shareholders expressed broad support for executive compensation program; ongoing engagement maintained .
Expertise & Qualifications
- CPA credential; deep credit administration leadership; multi-decade banking experience and board service at the banking subsidiary; education in accounting .
Equity Award Vesting Calendar (Implied)
- PRSU grants from 2022, 2023, 2024 cliff vest after three years subject to ROAE performance (anticipated vesting windows: mid-2025, mid-2026, mid-2027) .
Investment Implications
- Pay-for-performance alignment: Strong TSR and stable ROAE under an incentive framework anchored to peer-based ROAE targets and KPI overlays; long-term PRSUs drive multi-year alignment and can moderate short-term risk-taking .
- Event-driven supply: No 2024 exercises/vesting, but three PRSU cohorts can add supply if performance hurdles are met; monitor 3-year ROAE relative to 8.5% threshold and CRC actions on proration/forfeiture in retirement scenarios .
- Governance checks: While Mills is a non-independent director and Bank CEO, the presence of a Lead Independent Director, independent ACER/CRC/GNC committees, clawbacks, and prohibition of single-trigger severance reduce governance and pay-risk concerns; say-on-pay support is high .
- Retention economics: CIC termination value ($4.76MM) and without-cause severance ($2.51MM) suggest meaningful retention protection; absence of tax gross-ups and single-trigger cash mitigates shareholder-unfriendly optics; deferred comp and SERP balances add to total exit economics and should be considered in succession planning .