Steven Harris

About Steven C. Harris

Steven C. Harris, 61, serves as Executive Vice President and Chief Human Resources Officer (CHRO) of First Merchants Corporation (FMC). He joined FMC in March 2016 as Director of Talent Development and has been CHRO since November 2016, with responsibilities that include day-to-day administration of the Company’s executive compensation programs under the CEO’s direction and Compensation Committee oversight . Company performance context for compensation alignment: 2024 net income was $201.4 million and diluted EPS was $3.41; total shareholder return (TSR) index for 2024 was 113.97 (base=100) and the annual dividend rose 4% to $1.39 per share in 2024, supporting a pay-for-performance posture focused on EPS and shareholder returns .

Past Roles

External Roles

No external public company or nonprofit board roles for Harris are disclosed in FMC’s executive officer sections reviewed (2025, 2024, 2023 proxies) .

Fixed Compensation

• Salary-setting process: Executive salaries are reviewed annually in Feb/Mar after audited results; adjustments effective first March payroll, linking cash pay directly to prior-year performance and peer benchmarks (Aon-supported) .
• Base salaries disclosed individually for NEOs only; Harris’s base salary is not disclosed in the proxy (he is an executive officer but not an NEO) .

Performance Compensation

Senior Management Incentive Compensation Program (SMICP) – design for EVPs (including CHRO):

• Metric and governance:
  • EVP payouts are determined by FMC diluted GAAP EPS; Committee may use balanced scorecards for certain roles, and program is subject to an executive clawback .
  • Participants generally must be employed at payment date (exceptions for death/disability/retirement) .

2024 SMICP EPS schedule and outcome (Company-level):

Long-Term Equity Incentive Plan (LTEIP):

• Instrument and cadence: Restricted stock awards (no options since 2013); typical annual grant date in Q3 (e.g., Aug 8, 2024) with 3-year cliff vesting; dividends accrue during vesting; one-year minimum vest; death/disability or double-trigger change-in-control accelerates vest .
• 2024 price context: Grant-date fair value reference price $36.14/share on Aug 8, 2024 (for awards granted that date) .

Equity Ownership & Alignment

Employment Terms

• Employment agreements: FMC states it has no employment or other severance agreements with its executive officers; executives are at-will under Indiana law .
• Change-of-control (CoC): FMC maintains double‑trigger CoC agreements for NEOs and “certain other senior management employees”; benefits equal a multiple of base salary plus largest SMICP cash incentive from prior two years; NEO multiples disclosed range up to 2.99x; coverage/multiple for Harris not specifically disclosed .
• Clawback: Adopted 2023; applies to executive officers for awards/payouts based on materially inaccurate financials or as otherwise required .
• Insider trading policy: Formal policy covering officers and directors; attached to 10-K and overseen by Nominating & Governance Committee .

Performance & Track Record Context

Pay versus performance summary (Company-level):

Additional context: 2024 dividend increased to $1.39/share (from $1.34 in 2023); total assets at 12/31/2024 were $18.3B .

Compensation Structure Analysis

• Cash vs equity mix: Executive compensation framework blends fixed salary with EPS-linked cash incentives (SMICP) and time‑vested RSAs (LTEIP), with equity emphasis increased vs options since 2013, lowering risk relative to options .
• Metrics rigor: 2024 SMICP target EPS ($3.87) vs actual ($3.41) produced sub-target payouts (88% of target for NEOs), evidencing downshifts when plan goals are not met .
• Risk controls: Caps on SMICP payouts, clawback, anti‑hedging/pledging, and stock ownership rules mitigate excessive risk-taking and misalignment .
• Shareholder validation: 2024 say-on-pay support was 92.65%, signaling investor acceptance of overall compensation design .

Related-Party/Regulatory Notes

• Section 16 timeliness: Harris had late Form 4 filings linked to an RSA grant (Aug 10, 2023) and a 401(k) purchase (Oct 4, 2023); prior year (2022) late filings for executive tax-withholding sales of RSAs included Harris among others .
• Related-party transactions: FMC reports insider banking transactions occur on market terms with standard risk; no Harris-specific related-party transactions disclosed .

Compensation Peer Group (for benchmarking)

Investment Implications

• Alignment and retention: Harris’s incentive pay is tied to company EPS under the SMICP and his equity is time‑vested RSAs with 3-year cliffs and double-trigger CoC protection—factors that generally encourage medium-term retention and align incentives with EPS growth and TSR .
• Selling pressure and trading signals: Expect recurring vest events and associated tax‑withholding transactions around August (typical grant/vesting cadence), which may generate predictable Form 4 activity; monitor for any discretionary sales beyond tax obligations as potential signals .
• Governance risk: Hedging/pledging prohibitions and a robust clawback lower misalignment risk; high say‑on‑pay support reduces near‑term governance overhang; isolated late Section 16 filings suggest administrative—not economic—risk, but still worth monitoring for recurrence .
• CoC economics: While Harris’s specific CoC coverage is not disclosed, the Company’s use of double‑trigger agreements for NEOs and some senior managers suggests retention support in a sale scenario, with limited standalone cost impact relative to market cap .