Douglas T. Eden
About Douglas T. Eden
Douglas T. Eden (age 54) is an independent director of Hawthorn Bancshares, Inc. and Hawthorn Bank, serving since October 2023 and currently in Class I with a term expiring at the 2026 annual meeting. He is Principal and Investment Advisor Representative of Eden Capital Management, LLC; he holds a Bachelor’s Degree in Economics from The Wharton School (1992) and brings over 30 years of experience in property & casualty insurance and investment advising, including oversight of a $2 billion investment portfolio at Main Street America Group (2012–2014) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| CNA Financial (Chicago, IL) | Senior Vice President | Not disclosed | P&C insurance leadership experience |
| The Main Street America Group (Jacksonville, FL) | Senior Vice President; Investment Committee member | Investment Committee: 2012–2014 | Oversight of $2B investment portfolio; investing expertise |
| Selective Insurance Company (Branchville, NJ) | Executive Vice President | Not disclosed | Executive leadership; insurance operations |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Eden Capital Management, LLC | Principal and Investment Advisor Representative | Current | Private asset management |
| Hawthorn Bank Investment Committee | Outside Advisory Director | Current | Listed on Hawthorn Bank’s site as outside advisory director |
Board Governance
- Independence: The board determined Eden meets Nasdaq independence requirements .
- Committee assignments: Compensation Committee (member); Nominating & Corporate Governance Committee (member) .
- Committee chairs: Compensation (Gus S. Wetzel, III); Nominating & Corporate Governance (Philip D. Freeman); Audit (Frank E. Burkhead) .
- Attendance and engagement: The board met nine times in 2024; each director attended at least 75% of board and committee meetings on which they served. Eden attended the June 2024 annual meeting (all directors attended except Jonathan D. Holtaway) .
- Lead independent director: None formally; independent director Philip D. Freeman leads executive sessions; independent directors meet in executive session at least annually .
- Risk oversight: Audit committee met eight times; compensation committee met six times; nominating & corporate governance committee met three times in 2024 .
Fixed Compensation
- Director pay structure (non-employee directors): $2,000 monthly retainer; $900 per Company board meeting; $650 per Company committee meeting; $650 per Hawthorn Bank board meeting .
| Component (2024) | Amount ($) |
|---|---|
| Total Fees Earned or Paid in Cash | 36,650 |
| Hawthorn Bancshares Retainer | 24,000 |
| Hawthorn Bancshares Meeting Fees | 10,700 |
| Hawthorn Bank Meeting Fees | 1,950 |
Performance Compensation
- Director equity or performance-based pay: None disclosed for non-employee directors in 2024; director compensation consisted solely of cash fees .
| Performance Metric | Target | Actual | Payout |
|---|---|---|---|
| None disclosed for directors | — | — | — |
Other Directorships & Interlocks
| Category | Details |
|---|---|
| Current public company boards | None disclosed for Eden |
| Shareholder interlocks at HWBK | Eden beneficially owns 9.7% of HWBK; Jonathan D. Holtaway (independent director) is associated with entities holding 5.3% of HWBK, creating significant insider investor oversight on the board |
| Committee interlocks | Both Eden and Holtaway are independent directors; Eden serves on Compensation and Nominating & Corporate Governance Committees |
Expertise & Qualifications
- Education: B.S. in Economics, The Wharton School (1992) .
- Industry experience: 24 years in P&C insurance (SVP roles at CNA Financial and Main Street America Group; EVP at Selective Insurance) .
- Investment oversight: Member of Main Street America Group Investment Committee (2012–2014) overseeing $2B portfolio; active investor and advisor .
- Board value-add: Anticipated benefit to board discussions from insurance and investing experience .
Equity Ownership
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Total beneficial ownership: 678,977 shares (9.7% of outstanding as of Jan 31, 2025) .
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Breakdown: | Category | Shares | Voting/Disposition Power | |---|---|---| | Direct | 23,174 | Sole | | Wife’s trust | 572 | Shared | | Joint with minor child | 10 | Shared | | Trust (Eden as trustee) | 76,826 | Sole | | Funds managed by Eden | 578,395 | Shared | | Total | 678,977 | 9.7% of 6,988,625 shares outstanding |
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Pledging/Hedging: Company insider trading policy strongly discourages hedging/monetization transactions (e.g., collars, forwards) and requires pre-clearance; no pledging disclosed for Eden .
Insider Trades (Form 3/4)
| Date Filed | SEC Form | Transaction | Shares | Price ($) | Holder/Nature |
|---|---|---|---|---|---|
| 2024-03-11 | Form 4 | Purchase | 7,000 | 22.32 | By trust (Douglas T. Eden) |
| 2023-11-03 | Form 3 | Initial statement of beneficial ownership | 73,000; 582; 10 (various) | — | By trust; by wife’s trust; by son (minor) |
Governance Assessment
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Strengths:
- Independent director with robust insurance and investment experience; active engagement on Compensation and Nominating & Corporate Governance committees .
- High “skin-in-the-game” with 9.7% ownership, aligning interests with shareholders; attendance at least 75% of meetings and participation at annual meeting (2024) .
- Board-level governance practices include regular executive sessions led by an independent director, adoption of a clawback policy effective October 2, 2023, and strong say-on-pay support (>94% approval in 2024) .
- Anti-hedging and pre-clearance requirements in insider trading policy promote alignment and reduce risk of misaligned hedging .
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Potential concerns and RED FLAGS:
- Large insider ownership combined with fund-managed holdings can create perceived conflicts, especially with Eden serving on the Compensation Committee; robust conflict management and disclosure processes are important to maintain investor confidence .
- Director compensation is entirely cash-based with no equity retainer for directors in 2024, which may limit director-level equity alignment (mitigated by Eden’s personal stake) .
- Presence of 280G excise tax gross-up in a change-in-control agreement for an executive (Gregg A. Bexten) is a shareholder-unfriendly provision; the Compensation Committee (which includes Eden) oversees pay structures and should evaluate de-risking such features over time .
- While related-party transactions were not reportable since fiscal 2023, ongoing monitoring is warranted due to Eden’s dual role as an investor managing funds that hold Company stock .
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Related-party and conflicts control:
- Annual D&O questionnaires and Audit Committee review required for related-person transactions; policy mandates terms no more favorable than arms-length and Audit Committee approval; no reportable transactions since fiscal 2023 .
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Board structure signals:
- Separate Chair and CEO roles; independent committee chairs; risk oversight primarily via Audit Committee with quarterly engagement and annual ERM presentation to the board .
Say-on-Pay & Shareholder Feedback
- Say-on-pay approval: Over 94% approval at June 4, 2024 annual meeting; annual say-on-pay cadence affirmed by prior shareholder vote .
Compensation Committee Analysis
- Composition: Chair Wetzel; members Burkhead, Eden, Freeman, Riley, States; independent under Nasdaq; non-employee directors per SEC Rule 16b-3 .
- Consultant use: McLagan (Aon) engaged in 2024 for peer group and market analysis; committee assessed independence and found no conflicts; management retained Aon affiliates for non-executive comp and actuarial services .
- Risk review: Committee determined 2024 compensation programs did not subject the Company to unnecessary or excessive risk .
Related Party Transactions
- None reportable since fiscal 2023; policy requires Audit Committee approval and arms-length terms for any related-person deals .
Director Compensation Structure Analysis
- Mix: All cash in 2024 (retainer and meeting fees); no disclosed equity grants to directors under the Equity Plan in 2024 .
- Year-over-year shift indicators: Not disclosed for director equity; Equity Plan authorizes director awards, but 2024 grants were to executives (RSUs) .
Expertise & Qualifications
- Highlights: Insurance risk management, capital markets and investment oversight; expected contribution to board discussions and decisions .
Governance Quality Summary
- Overall, Eden provides deep insurance and investment expertise and significant ownership alignment. Investors should monitor Compensation Committee decisions in light of Eden’s dual roles as board member and fund manager with substantial HWBK holdings, ensure continued robust conflict-of-interest controls, and evaluate director equity alignment in future proxy cycles .