Rodger A. McHargue
About Rodger A. McHargue
Rodger A. McHargue, age 63, is Chief Financial Officer of First Financial Corporation and First Financial Bank, N.A., and also serves as the Corporation’s Secretary and Treasurer; he has been CFO since 2010 and joined the company in 1994 . McHargue holds a B.S. in Economics and Finance and an MBA from Indiana State University and is a graduate of the ABA Stonier Graduate School of Banking . As principal financial officer, he certifies quarterly and annual reports under Sarbanes-Oxley Sections 302 and 906 . Corporate performance in 2024 included net income of $47.3M ($4.00 EPS), ROAA of 0.92% (vs 1.26% in 2023), and total loans up 21.13% year over year following the SimplyBank acquisition; say‑on‑pay support was ~94% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| First Financial Corporation; First Financial Bank, N.A. | Chief Financial Officer; Secretary & Treasurer (Corporation) | 2010–present | Principal Financial Officer certifications; leads investor communications and filings; signed material 8‑Ks and 10‑Qs |
| First Financial Corporation | Management roles; joined the Corporation | 1994–present | Long-tenured finance leadership; supports acquisitions/integration (e.g., SimplyBank) |
External Roles
No external directorships or roles disclosed in company filings for McHargue .
Fixed Compensation
| Metric | 2024 | 2025 |
|---|---|---|
| Base salary ($) | $360,000 | $374,040 (effective 1/1/2025) |
| Subsidiary board fees ($) | $4,800 | — |
| Target STIP (% of base) | 35% | Not less than 35% |
| Target STIP ($) | $127,680 (applied to $364,800 base+fees) | Not less than 35% of base (plan minimum) |
Performance Compensation
Short‑Term Incentive (STIP) – 2024 (Cash)
| Metric | Target | Actual/Result | Weight | Score contribution | Payout ($) |
|---|---|---|---|---|---|
| Bank Net Income | $62,343K | $57,403K | 50% | 46.04% | |
| Efficiency Ratio | 64.13% | 64.72% | 25% | 24.77% | |
| Department Controllable | $2,662K | $2,541K | 25% | 26.19% | |
| Overall | — | — | — | 97.00% | $123,850 |
Notes: Committee approved adjustments to targets/results related to SimplyBank timing and purchase accounting to better reflect operational performance .
Long‑Term Incentive (LTIP) – 2022–2024 Performance (Granted Feb 2025 as Restricted Stock)
| Metric | Target | Actual/Result | Weight | Score contribution |
|---|---|---|---|---|
| Return on Assets | 1.16% | 1.24% | 20% | 21.38% |
| Return on Equity | 12.35% | 13.40% | 15% | 16.28% |
| Tangible Book Value | $31.39 | $35.73 | 30% | 34.15% |
| EPS | $4.81 | $3.98 | 35% | 28.96% |
| Overall | — | — | — | 100.76% |
| LTIP Target (% of base) | LTIP Target ($) | LTIP Awarded ($) | Vesting |
|---|---|---|---|
| 45% of $364,800 (base+fees) | $164,160 | $165,412 | Restricted stock vests in three equal installments beginning Dec 31 of grant year and then the following two years; dividends paid on restricted shares; no automatic acceleration on change in control |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 34,491 shares (<1% of outstanding) as of Feb 28, 2025 |
| Unvested RS | 3,621 shares; market value $167,254 (close $46.19 on 12/31/2024) |
| 2024 stock vested | 3,291 shares; value realized $152,011 |
| Ownership guidelines | NEOs must own stock equal to $150,000 in value; McHargue currently meets guidelines |
| Hedging/Pledging | Prohibited for NEOs and directors; insider trading policy forbids margin/pledging |
| Options | Historical practice is not to grant stock options to executive officers |
Employment Terms
| Term/Provision (agreement) | July 1, 2024 agreement | July 1, 2025 agreement |
|---|---|---|
| Effective date & term | July 1, 2024; 24 months with annual extension by Committee | July 1, 2025; initial 24 months; annual extension by Committee |
| Base salary | $360,000 (2024) | $374,040 (effective 1/1/2025) |
| Target incentives | STIP target 35%; LTIP target 45% | STIP target not less than 35%; LTIP target not less than 45% |
| Non‑compete & non‑solicit | 1‑year non‑compete/non‑solicit; generally 75‑mile radius from Terre Haute; radius reduces to 50 miles if separation without cause or for good reason | 1‑year non‑compete/non‑solicit; 75‑mile radius from Terre Haute; radius reduces to 50 miles on certain separations |
| Severance (no CIC) | Lump-sum cash equal to salary/target bonus/benefits through term; example as of 12/31/2024: $1,072,742 cash plus full vesting of outstanding restricted stock ($167,254) upon termination without cause/resignation for good reason | |
| Severance (CIC) | Greater of the no‑CIC severance or 2.0× sum of base salary + target bonus + benefits (for NEOs other than CEO); example as of 12/31/2024: $1,429,889 cash plus full vesting of outstanding restricted stock ($167,254) | |
| 280G/409A | No excise tax gross‑ups; 280G cutback/best‑net; certain payments subject to six‑month delay per Section 409A | No excise tax gross‑ups; 280G cutback/best‑net; 409A compliance framework detailed |
| Trust (CIC) | — | CIC trust funding and arbitration procedures if CIC was not board‑approved |
Compensation Peer Group (used for 2024 pay benchmarking)
- 1st Source Corporation; City Holding Co.; CNB Financial Corp.; Community Trust Bancorp, Inc.; First Busey Corporation; First Mid Bancshares, Inc.; German American Bancorp Inc.; Great Southern Bancorp Inc.; Horizon Bancorp; Independent Bank Corporation; Lakeland Financial Corp.; Macatawa Bank Corporation; MidWest One Financial Group, Inc.; Peoples Bancorp, Inc.
Independent consultant Pearl Meyer advised the Committee and found total cash and total direct compensation approximated peer median; design aligned with best practices .
Say‑On‑Pay & Shareholder Feedback
Executive compensation program received ~94% approval at the 2024 annual meeting; the company maintains ongoing shareholder engagement .
Additional Performance and Governance Signals
- CFO certifications under SOX Sections 302 and 906 for Q3 2025 indicate robust disclosure controls and internal control oversight .
- Efficiency ratio improved to 56.63% for Q3 2025 vs 64.43% a year earlier; McHargue is listed as investor contact on associated releases .
- Anti‑hedging and anti‑pledging policies, equity award grant timing policies, and a clawback policy adopted in 2023 enhance pay‑for‑performance governance .
Investment Implications
- Alignment: Cash/equity mix is balanced with meaningful at‑risk pay tied to objective STIP (net income/efficiency) and LTIP (ROA/ROE/TBV/EPS), and ownership guidelines met; anti‑hedging/pledging plus clawback reduce agency risk .
- Retention risk: Contractual protections include 1‑year non‑compete/non‑solicit and severance; CIC protection at 2.0× for CFO limits abrupt departure risk while avoiding gross‑ups (shareholder‑friendly) .
- Performance linkage: 2024 STIP paid at 97% of target on mixed outcomes (NI below target offset by controllable expenses); LTIP for 2022–2024 paid near target with strong ROA/ROE/TBV offset by lower EPS, signaling balanced long‑term incentives .
- Trading signals: Restricted stock vests in equal tranches each Dec 31; grants are made in open windows and do not auto‑accelerate on CIC, reducing opportunistic timing risk . Form 4 flow analysis was not available due to an access issue; no pledging/hedging permitted under policy .