Richard J. Shagley
About Richard J. Shagley
Independent director since 2020 with 54+ years in legal practice, admitted to the Indiana Bar in 1971 and to practice before the U.S. Supreme Court; age 78 as disclosed. Expertise spans pension plans, ERISA funds, trust funds, and real estate; he has a record of public service including the Indiana State University Board of Trustees and other civic organizations. Education: B.S. from Indiana State University; J.D. from Indiana University .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Legal practice (Indiana Bar) | Attorney | Admitted 1971 (ongoing) | Experience includes pension plans, ERISA funds, trust funds, real estate; admitted before the U.S. Supreme Court . |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Indiana State University | Board of Trustees | Not stated | Legacy of public service; also served on other civic organizations (not specified) . |
Board Governance
- Independence: Board determined that all current members are independent except Norman L. Lowery, Norman D. Lowery, and Richard J. Shagley; therefore Shagley is not independent under NASDAQ Global Select Market standards .
- Committees and roles:
- Corporation: Directors’ Enterprise Risk Management; Enterprise Risk Management .
- Bank: Directors’ Enterprise Risk Management; Enterprise Risk Management; Investment; Loan; Trust and Asset Management .
- Directors’ ERM Committee composition includes Shagley; mandate covers enterprise risk coordination and policy effectiveness (meets at least quarterly) .
- Attendance: In 2024, the Board met 17 times; each director attended more than 75% of aggregate Board and committee meetings held while serving. All directors attended the 2024 Annual Meeting .
- Executive sessions: Independent Directors met four times in 2024; Lead Independent Director is Ronald K. Rich .
Fixed Compensation
| Component | Amount | Notes |
|---|---|---|
| Corporation annual retainer (non-employee director) | $40,000 | 2024 policy . |
| Bank annual retainer (non-employee director) | $5,000 | 2024 policy . |
| Board meeting fee (Corp. & Bank) | $750 per meeting | 2024 policy . |
| Committee fees (Corp.) | $1,000 per meeting (Audit; Compensation & Employee Benefits; Governance & Nominating) | 2024 policy . |
| Bank Loan Committee fee | $500 per meeting | 2024 policy . |
| 2024 cash fees earned – Shagley | $74,000 | Total reported for 2024 . |
- Directors’ Deferred Compensation Plan: Closed to new participants since 2011; no directors deferred amounts in 2024; payments in 2024 only to Brighton, Dinkel, Voges under legacy elections (no payments disclosed for Shagley) .
Performance Compensation
| Incentive Component | Status | Details |
|---|---|---|
| Equity grants to directors | Not disclosed/none indicated | Director compensation section lists cash retainers/fees; no director equity awards disclosed . |
| Performance-based pay (directors) | Not disclosed/none indicated | No STIP/LTIP metrics apply to directors; program described for NEOs only . |
| Clawback/hedging | Applicable policies | Company-wide clawback policy; anti-hedging and anti-pledging provisions apply to directors . |
Other Directorships & Interlocks
| Company/Organization | Type | Role | Notes |
|---|---|---|---|
| Indiana State University | Academic/non-profit | Trustee | Disclosed; no public company boards listed for Shagley . |
Expertise & Qualifications
- Legal/Regulatory depth: ERISA, pensions, trusts, real estate; admitted before U.S. Supreme Court .
- Risk oversight: Active member of Directors’ Enterprise Risk Management and Enterprise Risk Management Committees (Board and Bank) .
- Community and governance: History of civic leadership via ISU Trustees and other organizations .
Equity Ownership
| Holder | Beneficial Shares | % of Outstanding | Notes |
|---|---|---|---|
| Richard J. Shagley | 12,008 | <1% | As of Feb 28, 2025; 11,853,489 shares outstanding . |
| Ownership Policy | Requirement | Compliance |
|---|---|---|
| Director Stock Ownership Guidelines | 3× annual Corporation retainer value | All non-employee directors met guidelines except Ms. Jensen; implies Shagley in compliance . |
- Anti-hedging/pledging policy prohibits directors from hedging or pledging company securities, enhancing alignment and lowering collateral risk .
Governance Assessment
- Independence red flag: Shagley is classified as not independent; investors should assess rationale (not disclosed) and potential proximity to management given legal background and historic affiliations of the board’s leadership with a law firm including “Shagley” surname; company does not provide a specific reason in the proxy .
- Risk oversight strength: Heavy involvement in Directors’ ERM committees supports board-level attention to credit, liquidity, compliance, technology, strategic and reputation risks (quarterly cadence) .
- Attendance/engagement: Board met 17 times; all directors exceeded 75% attendance and attended the Annual Meeting, indicating baseline engagement .
- Compensation alignment: Director pay structure is modest, cash-based, and fee-for-service (no equity grants disclosed), with ownership guidelines requiring 3× retainer and anti-hedging/pledging prohibitions—positive for alignment, but absence of equity grants may slightly reduce long-term alignment relative to peers that use DSUs/RSUs .
- Related-party exposure: Company discloses ordinary-course loans to directors/executives on market terms and subject to banking regulations; no Shagley-specific transactions disclosed. Board has policies covering conflicts, approval processes, and Code of Business Conduct and Ethics oversight .
- Broader signals: 2024 say‑on‑pay approval at ~94% suggests shareholder support for compensation governance; continued refresh of governance policies (Code of Conduct, Insider Trading, Clawback) is positive .
RED FLAGS
- Not independent under NASDAQ rules; investors should monitor any relationships that could impair objective oversight, especially given heavy committee involvement in risk oversight .
- Family relationships on the board/executive team (Lowery family) are disclosed broadly; while not tied to Shagley, they can increase governance complexity; compensate with robust lead independent director structure and executive sessions .
Positives
- Strong ERM committee participation and structured risk oversight .
- Ownership guidelines compliance and anti‑hedging/pledging policy .
- Consistent attendance and Annual Meeting participation .