Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
the Securities Exchange Act of 1934 (Amendment No. )
|Filed by the Registrant x|
|Filed by a Party other than the Registrant ¨|
|Check the appropriate box:|
|¨||Preliminary Proxy Statement|
|¨||Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))|
|x||Definitive Proxy Statement|
|¨||Definitive Additional Materials|
|¨||Soliciting Material under §240.14a-12|
|First Capital, Inc.|
|(Name of Registrant as Specified In Its Charter)|
|(Name of Person(s) Filing Proxy Statement, if other than the Registrant)|
|Payment of Filing Fee (Check the appropriate box):|
|x||No fee required.|
|¨||Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.|
|(1)||Title of each class of securities to which transaction applies:|
|(2)||Aggregate number of securities to which transaction applies:|
|(3)||Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):|
|(4)||Proposed maximum aggregate value of transaction:|
|(5)||Total fee paid:|
|¨||Fee paid previously with preliminary materials.|
|¨||Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.|
|(1)||Amount Previously Paid:|
|(2)||Form, Schedule or Registration Statement No.:|
April 14, 2020
You are cordially invited to attend the
annual meeting of shareholders of First Capital, Inc. We will hold the meeting at the main office of First Harrison Bank,
220 Federal Drive, N.W., Corydon, Indiana, on Wednesday, May 27, 2020, at 12:00 noon, local time.
The notice of annual meeting and the proxy
statement appearing on the following pages describe the formal business to be transacted at the meeting. During the meeting,
we also will report on the operations of the Company. Directors and officers of the Company, as well as a representative of Monroe
Shine & Co., Inc., the Company’s independent registered public accounting firm, will be present to respond
to appropriate questions of shareholders.
It is important that your shares are represented
at this meeting, whether or not you attend the meeting in person and regardless of the number of shares you own. To make sure your
shares are represented, we urge you to vote via the Internet or telephone or by returning a completed proxy card. If you attend
the meeting, you may vote in person even if you have previously mailed a proxy card or voted via the Internet or by telephone.
We look forward to seeing you at the meeting.
|Michael L. Shireman||William W. Harrod|
|Chairman of the Board||President and Chief Executive Officer|
FIRST CAPITAL, INC.
220 Federal Drive, N.W.
NOTICE OF 2020 ANNUAL MEETING OF SHAREHOLDERS
|TIME AND DATE||12:00 noon, local time, on Wednesday, May 27, 2020|
|PLACE||First Harrison Bank|
|220 Federal Drive, N.W.|
|Corydon, Indiana 47112|
|ITEMS OF BUSINESS||(1)||The election of four (4) directors to serve for a term of three years;|
|(2)||The ratification of the selection of Monroe Shine & Co., Inc. as our independent registered public accounting firm
for the fiscal year ending December 31, 2020;
|(3)||An advisory vote on the compensation of our named executive officers as disclosed in the accompanying proxy statement; and|
|(4)||The transaction of such other business as may properly come before the meeting and any adjournment or postponement of the meeting.|
|RECORD DATE||In order to vote, you must have been a shareholder at the close of business on April 2, 2020.|
|PROXY VOTING||It is important that your shares be represented and voted at the meeting. You can vote your shares via the Internet, by telephone, or by completing and returning a proxy card. A printed proxy card for the annual meeting and a self-addressed, postage pre-paid envelope will be mailed to those shareholders that have not voted as of April 27, 2020. You can revoke a proxy at any time before it’s exercised at the meeting by following the instructions in the proxy statement.|
|BY ORDER OF THE BOARD OF DIRECTORS|
|Jill R. Keinsley|
|April 14, 2020|
FIRST CAPITAL, INC.
We are providing this proxy statement to
you in connection with the solicitation of proxies by the Board of Directors (the “Board”) of First Capital, Inc.
for the 2020 annual meeting of shareholders and for any adjournment or postponement of the annual meeting. In this proxy statement,
we may also refer to First Capital, Inc. as “First Capital,” the “Company,” “we,” “our”
First Capital is the holding company for
First Harrison Bank. In this proxy statement, we may also refer to First Harrison Bank as “First Harrison” or the “Bank.”
We will hold the annual meeting at the Bank’s
main office, 220 Federal Drive, N.W., Corydon, Indiana 47112, on Wednesday, May 27, 2020, at 12:00 noon, local time.
We intend to provide access to this proxy
statement and a proxy card to shareholders of record beginning on or about April 14, 2020.
IMPORTANT NOTICE REGARDING THE AVAILABILITY
OF PROXY MATERIALS
FOR THE SHAREHOLDER MEETING TO BE HELD
ON MAY 27, 2020
This Proxy Statement is available at http://www.edocumentview.com/FCAP.
Also available on this website is the Company’s
2019 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, which includes the Company’s
audited consolidated financial statements.
INFORMATION ABOUT VOTING
Who Can Vote at the Meeting
You are entitled to vote your shares of
First Capital common stock if the records of the Company show that you held your shares as of the close of business on April 2,
2020. As of the close of business on April 2, 2020, a total of 3,377,882 shares of First Capital common stock were outstanding.
Each share of common stock has one vote.
The Company’s Articles of Incorporation
provide that record holders of the Company’s common stock who beneficially own, either directly or indirectly, in excess
of 10% of the Company’s outstanding shares are not entitled to any vote with respect to the shares held in excess of the
Ownership of Shares; Attending the Meeting
You may own your shares of common stock
of First Capital in one or more of the following ways:
|·||Directly in your name as shareholder of record;|
|·||Indirectly through a broker, bank, or other holder of record in “street name;” or|
|·||Indirectly through the First Harrison Bank Employee Stock Ownership Plan (the “ESOP”) and Trust.|
If your shares are registered directly in
your name, you are the holder of record of those shares and we are sending these proxy materials directly to you. As the holder
of record, you have the right to give your proxy directly to us to vote at the annual meeting or you may vote in person at the
If you hold your shares in street name,
your broker, bank, or other holder of record is sending these proxy materials to you. As the beneficial owner, you have the right
to direct your broker, bank, or other holder of record how to vote by filling out a voting instruction form that accompanies your
proxy materials. Your broker, bank, or other holder of record may allow you to provide voting instructions by telephone or by the
Internet. Please see the instruction form provided by your broker, bank, or other holder of record that accompanies this proxy
statement. If you hold your shares in street name, you will need proof of ownership to be admitted to the meeting. A recent brokerage
account statement or a letter from your bank or broker are examples of proof of ownership. If you want to vote your shares of First
Capital common stock held in street name in person at the meeting, you must obtain a written proxy in your name from the broker,
bank, or other holder who is the record holder of your shares.
Participants in the ESOP may direct the
ESOP trustees how to vote the shares allocated to their accounts. See “Participants in the ESOP” below.
Quorum and Vote Required
We will have a quorum and will be able to conduct the business of the annual meeting if the holders of a majority of the outstanding
shares of common stock entitled to vote are present at the meeting, either in person or by proxy.
Required for Proposals. At this year’s annual meeting, shareholders will elect four (4) directors
to each serve for a term of three (3) years. In voting on the election of directors, you may vote in favor of all nominees,
withhold votes as to all nominees, or withhold votes as to specific nominees. There is no cumulative voting for the election of
directors. Directors must be elected by a plurality of the votes cast at the annual meeting. This means that the nominees receiving
the largest number of votes cast will be elected up to the maximum number of directors to be elected at the annual meeting. The
maximum number of directors to be elected at the annual meeting is four (4).
In voting on the ratification of the appointment
of Monroe Shine & Co., Inc. as the Company’s independent registered public accounting firm, you may vote in
favor of the proposal, against the proposal, or abstain from voting. To be approved, the proposal requires the affirmative vote
of a majority of the votes cast at the annual meeting.
In voting on the advisory resolution to
approve the compensation of the Company’s named executive officers, you may vote in favor of the proposal, against the proposal
or abstain from voting. To be approved, the proposal requires the affirmative vote of a majority of the votes cast at the annual
meeting. Because your vote is advisory, it will not be binding on the Board or the Company. However, the Board will review the
voting results and take them into consideration when making future decisions regarding executive compensation.
of Not Casting Your Vote. If you hold your shares in street name, it is critical that you cast your vote if you
want it to count in the election of directors, or with respect to the advisory proposal regarding executive compensation. Your
bank or broker is unable to vote your uninstructed shares in the election of directors or with respect to the advisory proposal
regarding executive compensation. Therefore, if you hold your shares in street name and you do not instruct your bank or broker
how to vote in the election of directors or with respect to the advisory proposal regarding executive compensation, no votes will
be cast on your behalf. These are referred to as “broker non-votes.” Your bank or broker, however, will continue to
have discretion to vote any uninstructed shares on the ratification of the appointment of the Company’s independent registered
public accounting firm. If you are a shareholder of record and you do not cast your vote, no votes will be cast on your behalf
on any of the items of business at the annual meeting.
We Count Votes. If you return valid proxy instructions or attend the meeting in person, we will count your
shares to determine whether there is a quorum, even if you abstain from voting. Broker non-votes also will be counted to determine
the existence of a quorum.
In the election of directors, votes that
are withheld and broker non-votes will have no effect on the outcome of the election.
In counting votes on the ratification of
the appointment of the independent registered public accounting firm and the advisory resolution regarding executive compensation,
abstentions and broker non-votes will have no effect on the outcome of the proposal.
Voting by Proxy
The Board is sending you this proxy statement
for the purpose of requesting that you allow your shares of our common stock to be represented at the annual meeting by the designated
proxies named by the Board. All shares of our common stock represented at the meeting by properly executed and dated proxies will
be voted according to the instructions indicated on the proxy card. If you sign, date, and return a proxy card without giving voting
instructions, your shares will be voted as recommended by the Board.
The Board recommends a vote:
|·||“FOR” each of the nominees for director;|
|·||“FOR” the ratification of Monroe Shine & Co., Inc. as the Company’s independent registered
public accounting firm; and
|·||“FOR” the approval of the compensation of the Company’s named executive officers as disclosed in this
If any matters not described in this proxy
statement are properly presented at the annual meeting, the persons named in the proxy card will use their own best judgment as
to how to vote your shares. This includes a motion to adjourn or postpone the annual meeting in order to solicit additional proxies.
If the annual meeting is postponed or adjourned, your common stock may be voted by the persons named in the proxy card on the new
meeting date as well unless you have revoked your proxy. The Company does not know of any other matters to be presented at the
You may revoke your proxy at any time before
the vote is taken at the annual meeting. To revoke your proxy, you must either advise the Company’s Corporate Secretary in
writing before your shares have been voted at the annual meeting, deliver valid proxy instructions with a later date, or attend
the meeting and vote your shares in person. Attendance at the annual meeting will not in itself constitute revocation of your proxy.
Instead of voting by mailing a proxy card,
registered shareholders can vote their shares of Company common stock via the Internet or by telephone. The Internet and telephone
voting procedures are designed to authenticate shareholders’ identities, allow shareholders to cast their vote, and confirm
that their vote has been recorded properly. Specific instructions for Internet and telephone voting are set forth on the proxy
card. The deadline for voting via the Internet or by telephone is 1:00 a.m., local time, on May 27, 2020.
Participants in the ESOP
If you participate in the ESOP, you will
receive a voting instruction form for all shares you may vote under the plan. Under the terms of the ESOP, the ESOP trustees vote
all shares held by the ESOP, but each participant in the ESOP may direct the trustees how to vote the shares of Company common
stock allocated to his or her account. The ESOP trustees will vote all allocated shares for which no timely voting instructions
are received in the same proportion as shares for which the trustees have received valid voting instructions. The deadline for
returning your voting instructions to the ESOP trustees is May 22, 2020.
The Company periodically reviews its corporate
governance policies and procedures to ensure that the Company meets the highest standards of ethical conduct, reports results with
accuracy and transparency, and fully complies with the laws, rules, and regulations that govern the Company’s operations.
As part of this periodic corporate governance review, the Board reviews and adopts best corporate governance policies and practices
for the Company.
Board currently consists of eleven members. All of the directors are independent under the listing standards of the The
NASDAQ Stock Market LLC (the “Nasdaq Rules”), except for William W. Harrod, our Chief Executive Officer. In determining
the independence of its directors, the Board considered transactions, relationships and arrangements between the Company and its
directors that are not required to be disclosed in this proxy statement under the heading “Other Information Relating
to Directors and Executive Officers—Transactions With Related Persons,” including loans or lines of credit that
the Bank has, directly or indirectly, made to Directors Byrd, Ernstberger, Harrod, Huber, Kraft, Moore, Orwick, Mark Shireman,
Board Leadership Structure and Board’s Role in Risk
Michael L. Shireman currently serves as
Chairman of the Board. The Chairman is independent under the Nasdaq Rules and does not serve as Chief Executive Officer.
However, the Board does not believe that mandating a particular structure, such as requiring that the Chairman of the Board be
independent under the Nasdaq Rules or separating the Chairman and Chief Executive Officer positions, are necessary to achieve
effective oversight. The Board endorses the view that one of its primary functions is to protect shareholders’ interests
by providing independent oversight of management, including the Chief Executive Officer. The Chairman of the Board has no greater
nor lesser vote on matters considered by the Board than any other director, and the Chairman does not vote on any related party
transaction. All directors of the Company, including the Chairman, are bound by fiduciary obligations, imposed by law, to serve
the best interests of the shareholders.
Risk is inherent with every business, and
how well a business manages risk can ultimately determine its success. The Company faces a number of risks, including
credit risk, interest rate risk, liquidity risk, operational risk, strategic risk, and reputation risk. Management is responsible
for the day-to-day management of the risks the Company faces, while the Board, as a whole and through its committees, has responsibility
for the oversight of risk management. In its risk management oversight role, the Board has the responsibility to satisfy
itself that the risk management processes designed and implemented by management are adequate and functioning as designed. Toward
this end, the Chairman of the Board meets regularly with management to discuss strategy and the risks facing the Company. Senior
management attends the Board meetings and is available to address any questions or concerns raised by the Board on risk management
and any other matters. The Chairman of the Board and independent members of the Board work together to provide strong, independent
oversight of the Company’s management and affairs through the Board’s standing committees and, when necessary, special
meetings of independent directors.
Committees of the Board of Directors
The following table identifies our standing
committees and their members. The members of the Audit, Compensation, and Nominating Committees are each independent in accordance
with the relevant Nasdaq Rules. The charters of the Audit Committee, Nominating Committee, and Compensation Committee are available
in the Investor Relations section of the Bank’s website (www.firstharrison.com).
|Christopher L. Byrd||X||X||X||X*|
|Kathryn W. Ernstberger||X||X||X|
|Robert C. Guilfoyle||X|
|William W. Harrod||X|
|Dana L. Huber||X|
|Pamela G. Kraft||X||X||X*|
|Lou Ann Moore||X|
|William I. Orwick, Sr.||X||X|
|Mark D. Shireman|
|Samuel E. Uhl||X|
|Michael L. Shireman||X*||X|
|Carolyn E. Wallace||X||X*|
|Number of Meetings in 2019||2||8||5||2|
* Denotes Chairperson
Committee. The Executive Committee evaluates issues of major importance to the Company between regularly scheduled
Board meetings. The Executive Committee acts on issues delegated to it by the Board.
Committee. The Board has a separately-designated standing Audit Committee established in accordance with
the Securities Exchange Act of 1934, as amended. The Audit Committee meets periodically with the Company’s independent registered
public accounting firm and management to review accounting, auditing, internal control structure and financial reporting matters.
The Board has determined that Christopher L. Byrd, William I. Orwick, Sr., Pamela G. Kraft and Carolyn E. Wallace are “audit
committee financial experts” under the rules of the Securities and Exchange Commission. The report of the Audit Committee
required by the rules of the Securities and Exchange Commission is included in this proxy statement. See “Report
of the Audit Committee.”
Committee. The Compensation Committee approves the compensation objectives for the Company and the Bank and
establishes the compensation for the Chief Executive Officer and periodically reviews and makes recommendations to the Board regarding
the compensation of non-employee directors. The Compensation Committee reviews all compensation components for the Company’s
Chief Executive Officer including base salary, annual incentives, short-term incentives, benefits and other perquisites. In addition
to reviewing competitive market values, the Compensation Committee also examines the total compensation mix, pay-for-performance
relationship, and how all elements, in the aggregate, comprise the Chief Executive Officers’ total compensation package.
Decisions by the Compensation Committee with respect to the compensation of the Chief Executive Officer are approved by the full
Board, excluding any member of the Board that also serves as the Chief Executive Officer. The Compensation Committee reviews and
makes recommendations to the Board with respect to any employment agreements and any severance arrangements or plans, including
any benefits to be provided in connection with a change in control, for the Chief Executive Officer and other executive officers.
The Compensation Committee also assists the Board in evaluating potential candidates for executive positions.
Committee. The Nominating Committee annually selects the Board’s nominees for election as directors. For the
procedures of the Nominating Committee, see “Nominating Committee Procedures” below.
Nominating Committee Procedures
It is the policy of the Nominating Committee to consider director candidates recommended by shareholders who appear qualified to
serve on the Board. The Nominating Committee may choose not to consider an unsolicited recommendation if no vacancy exists on the
Board and the Nominating Committee does not perceive a need to increase the size of the Board. In order to avoid the unnecessary
use of the Nominating Committee’s resources, the Nominating Committee will consider only those director candidates recommended
in accordance with the procedures set forth below.
to be Followed by Shareholders. To submit a recommendation of a director candidate to the Nominating Committee,
a shareholder should submit the following information in writing, addressed to Christopher L. Byrd, Chairperson of the Nominating
Committee, care of the Corporate Secretary, at the main office of the Company:
|1.||The name of the person recommended as a director candidate;|
|2.||All information relating to such person that is required to be disclosed in solicitations of proxies for election of directors
pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended;
|3.||The written consent of the person being recommended as a director candidate to being named in the proxy statement as a nominee
and to serving as a director if elected;
|4.||As to the shareholder making the recommendation, the name and address, as he or she appears on the Company’s books, of
such shareholder; provided, however, that if the shareholder is not a registered holder of the Company’s common stock, the
shareholder should submit his or her name and address, along with a current written statement from the record holder of the shares
that reflects ownership of the Company’s common stock; and
|5.||A statement disclosing whether such shareholder is acting with or on behalf of any other person and, if applicable, the identity
of such person.
In order for a director candidate to be considered
for nomination at the Company’s annual meeting of shareholders, the Nominating Committee must receive the recommendation
at least 120 calendar days before the date the Company’s proxy statement was released to shareholders in connection with
the previous year’s annual meeting, advanced by one year.
Qualifications for Nominees. The Nominating Committee has adopted a set of criteria that it considers when it selects
individuals to be nominated for election to the Board. First, a candidate must meet the age limitation requirements set forth in
the Company’s Bylaws. A candidate also must meet any qualification requirements set forth in any Board or committee governing
The Nominating Committee will consider the
following criteria in selecting nominees: financial, regulatory, and business experience; familiarity with and participation in
the local community; integrity, honesty and reputation; dedication to the Company and its shareholders; independence; and any other
factors the Nominating Committee deems relevant, including age, diversity, size of the Board, and regulatory disclosure obligations.
The Board will also consider the extent to which the candidate helps the Board reflect the diversity of the Company’s shareholders,
employees, customers, and communities. The Nominating Committee also may consider the current composition of the Board, the balance
of management and independent directors, and the need for audit committee expertise.
In addition, before nominating an existing
director for re-election to the Board, the Nominating Committee will consider and review an existing director’s Board and
committee attendance and performance; length of Board service; experience, skills, and contributions that the existing director
brings to the Board; and independence.
for Identifying and Evaluating Nominees. For purposes of identifying nominees for the Board, the Nominating Committee
relies on personal contacts of the committee members and other members of the Board, as well as its knowledge of members of First
Capital’s local communities. The Nominating Committee will also consider director candidates recommended by shareholders
in accordance with the policy and procedures set forth above. The Nominating Committee has not used an independent search firm
in identifying nominees.
In evaluating potential candidates, the Nominating
Committee determines whether the candidate is eligible and qualified for service on the Board by evaluating the candidate under
the selection criteria set forth above. In addition, the Nominating Committee will conduct a check of the individual’s background
and interview the candidate.
Board and Committee Meetings
The business of First Capital and First
Harrison is conducted through meetings and activities of their respective Boards of Directors and committees. During the fiscal
year ended December 31, 2019, the Board held 12 meetings and the Board of Directors of First Harrison held 12 meetings.
Directors Attendance at Annual Meeting
The Board encourages directors to attend
the Company’s annual meeting of shareholders. All directors attended the Company’s 2019 annual meeting of shareholders.
Code of Ethics and Business Conduct
The Company has adopted a Code of Ethics
and Business Conduct (the “Code”) that is designed to ensure that the Company’s directors and employees meet
the highest standards of ethical conduct. The Code, which applies to all employees and directors, addresses conflicts of interest,
the treatment of confidential information, general employee conduct and compliance with applicable laws, rules and regulations.
In addition, the Code is designed to deter wrongdoing and promote honest and ethical conduct, the avoidance of conflicts of interest,
full and accurate disclosure and compliance with all applicable laws, rules and regulations.
REPORT OF THE AUDIT COMMITTEE
The Company’s management is responsible
for the Company’s internal control over financial reporting. The independent registered public accounting firm is responsible
for performing an independent audit of the Company’s consolidated financial statements and issuing an opinion on the conformity
of those financial statements with accounting principles generally accepted in the United States of America. The Audit Committee
oversees the Company’s internal controls and financial reporting process on behalf of the Board.
In this context, the Audit Committee has
met and held discussions with management and the independent registered public accounting firm. Management represented to the Audit
Committee that the Company’s consolidated financial statements were prepared in accordance with accounting principles generally
accepted in the United States of America, and the Audit Committee has reviewed and discussed the consolidated financial statements
with management and the independent registered public accounting firm. The Audit Committee discussed with the independent registered
public accounting firm matters required to be discussed by Auditing Standard 16, as adopted by the Public Company Accounting Oversight
Board, including the quality, and not just the acceptability, of the accounting principles, the reasonableness of significant judgments
and the clarity of the disclosures in the financial statements.
In addition, the Audit Committee has received
the written disclosures and the letter from the independent registered public accounting firm required by the applicable requirements
of the Public Company Accounting Oversight Board and has discussed with the independent registered public accounting firm the firm’s
independence from the Company and its management. In concluding that the independent registered public accounting firm is independent,
the Audit Committee considered, among other factors, whether the non-audit services provided by the firm were compatible with its
The Audit Committee discussed with the Company’s
independent registered public accounting firm the overall scope and plans for their audit. The Audit Committee meets with the independent
registered public accounting firm, with and without management present, to discuss the results of their examination, their evaluation
of the Company’s internal control over financial reporting and the overall quality of the Company’s financial reporting
In performing all of these functions, the
Audit Committee acts only in an oversight capacity. In its oversight role, the Audit Committee relies on the work and assurances
of the Company’s management, which has the primary responsibility for financial statements and reports, and of the independent
registered public accounting firm who, in their report, express an opinion on the conformity of the Company’s financial statements
to accounting principles generally accepted in the United States of America. The Audit Committee’s oversight does not provide
it with an independent basis to determine that management has maintained appropriate accounting and financial reporting principles
or policies, or appropriate internal control over financial reporting designed to assure compliance with accounting standards and
applicable laws and regulations. Furthermore, the Audit Committee’s considerations and discussions with management and the
independent registered public accounting firm do not assure that the Company’s financial statements are presented in accordance
with accounting principles generally accepted in the United States of America, that the audit of the Company’s financial
statements has been carried out in accordance with the standards of the Public Company Accounting Oversight Board (United States)
or that the Company’s independent registered public accounting firm is in fact “independent.”
In reliance on the reviews and discussions
referred to above, the Audit Committee recommended to the Board, and the Board has approved, that the audited consolidated financial
statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 for filing
with the Securities and Exchange Commission. The Audit Committee has appointed, subject to shareholder ratification, the Company’s
independent registered public accounting firm for the fiscal year ending December 31, 2020.
The Audit Committee of the Board of Directors
of First Capital, Inc.
Carolyn E. Wallace, Chairperson
Christopher L. Byrd
William I. Orwick, Sr.
Pamela G. Kraft
Robert C. Guilfoyle
The following table provides the compensation
received by individuals who served as non-employee directors of the Company during the 2019 fiscal year. The table excludes perquisites,
which did not exceed $10,000 in the aggregate for each director.
|Change in Pension
|Christopher L. Byrd||$||16,221||$||25,286||$||—||$||1,703||$||43,210|
|Kathryn W. Ernstberger||16,221||25,286||—||1,703||43,210|
|Robert C. Guilfoyle||16,221||25,286||1,703||43,210|
|Dana L. Huber||16,221||25,286||—||1,703||43,210|
|Pamela G. Kraft||16,221||25,286||—||1,703||43,210|
|Lou Ann Moore||16,221||25,286||1,703||43,210|
|William I. Orwick, Sr.||16,221||25,286||—||1,703||43,210|
|Mark D. Shireman||16,221||25,286||5,170||1,703||48,380|
|Michael L. Shireman||16,221||25,286||—||1,703||43,210|
|Samuel E. Uhl||16,221||25,286||—||1,703||43,210|
|Carolyn E. Wallace||16,221||25,286||—||1,703||43,210|
|(1)||Represents a stock award of 375 shares of restricted common stock awarded on February 18, 2020 under the 2019 Equity Incentive
Plan based on the Company’s 2019 performance. The value of such stock award is based on a closing price of $67.43 on February 18,
|(2)||Represents above market earnings credited to the directors’ deferred compensation arrangements in fiscal 2019. Only Mark
D. Shireman maintains a deferred compensation agreement with First Harrison Bank.
|(3)||Represents a bonus earned in 2019 and paid in the first quarter of 2020.|
the year ending December 31, 2020, members of First Harrison’s Board of Directors will receive $1,355 in January
and 1,409.00 per month for the remainder of the year. No separate fees will be paid for service on committees or on First Capital’s
Board of Directors.
Directors’ Deferred Compensation Agreements
Effective April 1, 1992, First Harrison
Bank entered into a Director Deferred Compensation Agreement with Mark D. Shireman. The agreement provided Mr. Shireman with
an opportunity to defer a portion of his respective fees for a specified period of time. All deferrals have ceased under the agreements.
The agreement provides Mr. Shireman with a fixed benefit which, at his election, is payable in a lump sum or monthly over
a 180-month period. The agreement provides that Mr. Shireman may receive his respective deferred compensation benefit upon
the earlier of: attainment of age 70, disability, early retirement or death.
First Capital does not know of any beneficial
owners of more than 5% of the Company’s outstanding common stock. The following table provides information as of April 2,
2020 about the shares of First Capital common stock that may be considered to be beneficially owned by each director, each nominee
for director, by each named executive officer listed in the “Summary Compensation Table” and by all directors
and executive officers of the Company as a group. A person may be considered to beneficially own any shares of common stock over
which he or she has, directly or indirectly, sole or shared voting or investment power. Unless otherwise indicated, each of the
named individuals has sole voting power and sole investment power with respect to the shares shown and none of the named individuals
has pledged his or her shares.
|Christopher L. Byrd||5,514||(2)||*|
|Kathryn W. Ernstberger||2,191||(2)||*|
|Michael C. Frederick||8,224||(3)||*|
|Robert C. Guilfoyle||625||(4)||*|
|William W. Harrod||15,784||(5)||*|
|Dana L. Huber||10,556||(6)||*|
|Pamela G. Kraft||2,693||(8)||*|
|Lou Ann Moore||625||(4)||*|
|William I. Orwick, Sr.||4,125||(2)||*|
|Mark D. Shireman||50,767||(9)||1.50||%|
|Michael L. Shireman||14,972||(10)||*|
|Samuel E. Uhl||16,926||(12)||*|
|Carolyn E. Wallace||2,092||(2)||*|
|All directors and executive officers as a group (15 persons)||152,148||4.50||%|
*Less than 1.0%.
|(1)||Based on 3,377,882 shares of Company common stock outstanding and entitled to vote as of April 2, 2020.|
|(2)||Includes 1,125 shares of restricted stock.|
|(3)||Includes 3,207 shares allocated under the ESOP as to which Mr. Frederick exercises voting but not investment power and
3,375 shares of restricted stock.
|(4)||Includes 625 shares of restricted stock.|
|(5)||Includes 3,933 shares allocated under the ESOP as to which Mr. Harrod exercises voting but not investment power and 3,375
shares of restricted stock.
|(6)||Includes 1,025 shares of restricted stock.|
|(7)||Includes 249 shares allocated under the ESOP as to which Ms. Keinsley exercises voting but not investment power and 3,375
shares of restricted stock.
|(8)||Includes 400 shares held by the individual retirement account of Ms. Kraft’s spouse and 1,125 shares of restricted
|(9)||Includes 7,992 shares owned by Mr. Mark Shireman’s spouse, 2,200 shares held by the individual retirement account
of Mr. Mark Shireman’s spouse, and 1,125 shares of restricted stock.
|(10)||Includes 4,684 shares owned by Mr. Michael Shireman’s spouse, and 1,125 shares of restricted stock.|
|(11)||Includes 1,977 shares allocated under the ESOP as to which Mr. Thomas exercises voting but not investment power, and 3,375
shares of restricted stock.
|(12)||Includes 20 shares owned by Mr. Samuel Uhl’s spouse.|
ITEMS TO BE VOTED ON BY SHAREHOLDERS
Item 1 — Election of Directors
The Board is divided into three (3) classes
with three-year staggered terms, with approximately one-third of the directors elected each year. Four (4) directors will
be elected at the annual meeting to serve for a three-year term or until their respective successors have been elected and qualified,
or their earlier resignation, removal, or death. The nominees are William W. Harrod, Lou Ann Moore, Robert C. Guilfoyle, and Dana
L. Huber, each of whom are currently directors of the Company and the Bank.
The Board intends to vote the proxies solicited
by it in favor of the election of the nominees named above. If any nominee is unable to serve, the persons named in the proxy card
will vote your shares to approve the election of any substitute proposed by the Board. Alternatively, the Board may adopt a resolution
to reduce the size of the Board. At this time, the Board does not know of any reason why any nominee might be unable to serve.
Board of Directors recommends a vote “FOR” the election of William W. Harrod, Lou Ann Moore, Robert C. Guilfoyle, and
Dana L. Huber.
Information regarding the Board’s nominees
and the directors continuing in office is provided below. Unless otherwise stated, each individual has held his or her current
occupation for the last five years. The age indicated in each individual’s biography is as of the date of the 2020 annual
meeting. The indicated period for service as a director includes service as a director of First Harrison.
Directors Nominees for Terms Ending in
W. Harrod became the President and Chief Executive Officer of First Capital in January 2000 and became the
President and Chief Executive Officer of First Harrison in October 2012. Mr. Harrod previously served as President and
Chief Executive Officer of HCB Bancorp, Inc. and Harrison County Bank. Mr. Harrod is a former director of HCB Bancorp, Inc.
Age 64. Director since 2000.
Mr. Harrod’s extensive experience
in the local banking industry and involvement in business and civic organizations in the communities in which the Bank serves affords
the Board valuable insight regarding the business and operations of the Company and Bank. In addition, Mr. Harrod’s
knowledge of all aspects of the Company’s and Bank’s business and history, combined with his success and strategic
vision, position him well to continue to serve as President and Chief Executive Officer of the Company.
Ann Moore is currently an Owner and real estate broker for Century 21 Advantage Plus. She also serves on the Board
of Directors of the Jefferson County Technical College, Bullitt County YMCA and Bullitt County Chamber of Commerce and serves on
the Board of Trustees for the Bernheim Arboretum and Research Forest. Age 63. Director since 2018.
Ms. Moore’s expertise in real
estate affords the Board valuable insight regarding particular real estate markets and offers the Board a unique perspective on
operations of the Company and the Bank.
C. Guilfoyle is the founder and past Chief Executive Officer of Abe AI, Inc. Mr Guilfoyle now serves as the VP of
Artificial Intelligence Products at Envestnet, Inc where he works with financial institutions to deploy AI achieving operational
efficiency and increasing user experiences. He holds a Bachelor of Science in Informatics with a focus on Information Security
and Computer Science from Indiana University. Age 31. Director since 2018.
Mr. Guilfoyle’s financial and technology
background will provide the Board with valuable insights into how the Bank can leverage vendors to create better experiences.
L. Huber is currently the Vice President, Marketing and Public Relations at Huber’s Orchard, Winery, &
Vineyards. Prior to joining Huber’s Orchard, Winery, & Vineyards in 2003, Ms. Huber worked for Humana, Citicorp,
and Kindred Healthcare. She currently sits on the Agribusiness council at the Federal Reserve Bank of St. Louis. Age 52. Director
Ms. Huber’s experience managing
a sixth generation family owned business offers the Board substantial small company management experience. She is also very familiar
within the region in which the Bank conducts its business and provides the Board with insight regarding the local business and
Directors Continuing in Office with Terms
Ending in 2021
W. Ernstberger is a professor of business administration at Indiana University Southeast in New Albany, Indiana.
Age 57. Director since 2003.
Ms. Ernstberger’s expertise provides
the Board with quantitative business analysis skills, specifically in the areas of statistics and mathematical modeling.
I. Orwick, Sr. has been a partner in the accounting firm of Rodefer Moss & Co., PLLC in New Albany, Indiana
since September 2009. Mr. Orwick was previously a partner in the accounting firm of Melhiser Endres Tucker CPAs PC prior
to such firm’s acquisition by Rodefer Moss & Co., PLLC in September 2009. Age 63. Director since 2010.
As a partner in a certified public accounting
firm, Mr. Orwick provides the Board with significant experience regarding accounting and compliance matters. Mr. Orwick’s
experience also offers the Board substantial small and local company operations and management experience, specifically within
the region in which the Bank conducts its business, and provides the Board with valuable insight regarding the local business
and consumer environment. In addition, Mr. Orwick offers the Board significant business experience individually
and from his network of professionals and organizations both familiar with matters outside and inside of the financial services
E. Wallace is the Director of Business Operations for the South Harrison Community School Corporation in Corydon, Indiana.
Age 51. Director since 2010.
Ms. Wallace’s training as a certified
public accountant and accounting background provide the Board with experience regarding accounting and financial matters.
Directors Continuing in Office with Terms
Ending in 2022
L. Byrd is the manager and owner of Hoosier Hollywood Development, LLC (d/b/a Corydon Cinemas) in Corydon, Indiana,
and is also a licensed certified public accountant and attorney. Age 52. Director since 2010.
Mr. Byrd’s background offers the
Board significant small company management experience, specifically within the community in which the Bank conducts its business,
and provides the Board with valuable insight regarding the local business and consumer environment. In addition, Mr. Byrd
offers the Board significant business experience from a setting outside of the financial services industry.
G. Kraft is the President of Generations Monuments & Memorials, Inc. in New Albany, Indiana and
serves as Vice President — Treasurer of the Funeral Consumer Guardian Society in New Albany, Indiana. Age 61. Director
Ms. Kraft’s involvement with the
Funeral Consumer Guardian Society has allowed her to develop strong ties to the community and has provided the Board with valuable
insight regarding the local business environment.
D. Shireman is the Chairman of the Board of James L. Shireman, Inc. in Corydon, Indiana. Age 68. Director
Mr. Shireman’s substantial small
company management experience, specifically within the region in which the Bank conducts its business, provides the Board
with valuable insight regarding the local business and consumer environment. In addition, Mr. Shireman offers the
Board significant business experience from a setting outside of the financial services industry through his involvement in business
and civic organizations in the communities in which the Bank serves.
L. Shireman is past Chairman of the Board of Uhl Truck Sales, Inc., a medium and heavy truck dealer in Louisville,
Kentucky and Palmyra, Indiana. Mr. Shireman is a former director of HCB Bancorp, Inc. Age 71. Director since 2000.
Mr. Shireman’s background offers
the Board significant small company management experience, specifically within the community in which the Bank conducts its
business, and provides the Board with valuable insight regarding the local business and consumer environment. In addition, Mr. Shireman
offers the Board significant business experience from a setting outside of the financial services industry.
Item 2 — Ratification of Independent Registered Public
The Audit Committee of the Board has appointed
Monroe Shine & Co., Inc. to be the Company’s independent registered public accounting firm for the 2020 fiscal
year, subject to ratification by shareholders. A representative of Monroe Shine & Co., Inc. is expected to be present
at the annual meeting to respond to appropriate questions from shareholders and will have the opportunity to make a statement should
he/she desire to do so.
If the ratification of the appointment of
the independent registered public accounting firm is not approved by a majority of the votes cast by shareholders at the annual
meeting, the Audit Committee of the Board will consider other independent registered public accounting firms.
The Board recommends that shareholders
vote “FOR” the ratification of the appointment of Monroe Shine & Co., Inc. as the Company’s independent
registered public accounting firm.
Fees. The following table sets forth the fees that Monroe Shine & Co., Inc. billed to the Company
for the fiscal years ended December 31, 2019 and 2018.
|Audit Fees (1)||$||142,510||$||138,320|
|Audit-Related Fees (2)||21,220||20,605|
|Tax Fees (3)||25,595||23,875|
|All Other Fees||—||—|
|(1)||Includes fees billed for the integrated audit of the consolidated financial statements and internal control over financial
reporting as required under Section 404 of the Sarbanes-Oxley Act, and the review of interim financial information contained
in quarterly reports on Form 10- Q and other regulatory reports.
|(2)||Includes fees billed for attestation and related services traditionally performed by the auditor, including attestation services
not required by statute or regulation, and consultation concerning financial accounting, reporting and regulatory standards.
|(3)||Includes fees billed for tax compliance services, including preparation of federal and state income tax returns, preparation
of property tax returns, and tax payment and planning advice.
on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm. The
Audit Committee is responsible for appointing, setting compensation and overseeing the work of the independent registered public
accounting firm. In accordance with its charter, the Audit Committee approves, in advance, all audit and permissible non-audit
services to be performed by the independent registered public accounting firm. This approval process ensures that the firm does
not provide any non-audit services to the Company that are prohibited by law or regulation.
Item 3 — Advisory Vote on Executive Compensation
As required by federal securities laws,
the Board is providing the Company’s shareholders with an opportunity to provide an advisory vote on the compensation of
our named executive officers as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission,
including the compensation tables and the related narrative discussion contained in this proxy statement.
This proposal, commonly known as a “say-on-pay”
proposal, gives the Company’s shareholders the opportunity to endorse or not endorse the Company’s executive pay program
and policies through a vote on the following resolution:
“RESOLVED, that the compensation paid to the
Company’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and
Exchange Commission, including the compensation tables and related narrative discussion contained in the 2020 proxy statement,
is hereby approved.”
This advisory vote on the compensation of
our named executive officers is not binding on us, our Board, or the Compensation Committee. However, our Board and the Compensation
Committee will review and consider the outcome of this advisory vote when making future compensation decisions for our named executive
The Board recommends that shareholders
vote “FOR” the compensation paid to the Company’s named executive officers, as disclosed pursuant to the compensation
disclosure rules of the Securities and Exchange Commission, including the compensation tables and related narrative discussion
contained in this proxy statement.
Summary Compensation Table
The following table sets forth information
regarding the compensation paid, awarded to, or earned for the fiscal years ended December 31, 2019, and 2018 by each of the
Company’s executive officers.
|Name and||Incentive||All Other|
|Principal Position||Year||Salary (1)||Stock Awards (2)||Compensation (3)||Compensation (4)||Total|
|William W. Harrod||2019||$||246,698||$||75,858||$||39,200||$||30,976||$||392,732|
|President, Chief Executive Officer||2018||236,145||39,068||31,968||39,200||336,594|
|Michael C. Frederick||2019||141,254||75,858||29,832||25,022||271,966|
|Chief Financial Officer||2018||136,017||39,068||23,566||24,341||222,292|
|Senior Vice President||2018||123,513||39,068||22,319||16,653||201,553|
|Senior Vice President||2018||109,323||39,068||20,902||15,177||184,470|
|(1)||For Mr. Harrod, includes directors’ fees for service as an employee director of $15,754 and $16,221 for 2018 and
|(2)||For 2018, represents a stock award of 750 shares of restricted common stock awarded on February 19, 2019. The value of
such stock award is based on a closing price of $52.09 on February 19, 2019. Each stock award vests over a five (5) year
period, with one-fifth (1/5) vesting on each July 1st, beginning July 1, 2020. For 2019, represents a stock award of
1,125 shares of restricted common stock awarded on February 18, 2020. The value of such stock award is based on a closing price
of $67.43 on February 18, 2020. Each stock award vests over a five (5) year period, with one-fifth (1/5) vesting on each July 1st,
beginning July 1, 2021.
|(3)||Bonus amounts earned in 2019 were paid in the first quarter of 2020, under the Bonus Plan.|
|(4)||Details of the amounts reported in the “All Other Compensation” column for 2019 are provided in the table below:|
|Employer contributions to 401(k) plan||$||16,133||$||9,888||$||8,979||$||7,554|
|Employer contributions to health savings account||1,500||1,500||—||1,000|
Outstanding Equity Awards at Fiscal Year-End
The following table sets forth information
concerning outstanding stock awards at December 31, 2019 held by our executive officers. At December 31, 2019 there were
no outstanding stock options. Market values for outstanding stock awards are based on the closing price of our common stock on
December 31, 2019 (the last trading day of the year) of $73.00.
|William W. Harrod||2,250||$||164,250|
|Michael C. Frederick||2,250||164,250|
each executive officer, 750 shares of common stock will vest on July 1st , 2020 and 450 shares of common stock will vest
on July 1st, 2021, 2022, and 2023 and 150 shares of common stock will vest on July 1st
Stock Vested in 2019
The following table sets forth information
concerning the exercise of options and the vesting of stock awards in 2019 by our named executive officers. There were no stock
options exercised in 2019.
on Vesting (1)
|William W. Harrod||600||$||30,726|
|Michael C. Frederick||600||30,726|
|(1)||Based on a closing price of $51.21 on July 1, 2019, the date on which such shares vested.|
Potential Payments Upon Termination or Change in Control
None of our executive officers are subject
to any employment agreement which would entitle them to any payment upon termination of employment, absent a change in control.
As is more fully described below, all of the named executive officers were subject to change in control agreements with us that
were in effect on December 31, 2019 (each, a “Change in Control Agreement”), which provide for payments and benefits
to our executive officers following a change in control of First Capital, Inc. and termination of the executive officer’s
employment within twelve (12) months (a “Change in Control Termination”). The following table sets forth information
concerning potential payments and benefits to which our executive officers would be entitled as of December 31, 2019 in the
event of a Change in Control Termination. For purposes of estimating the value of certain equity awards, we have assumed a price
per share of our common stock of $73.00, which was the closing price of our stock on December 31, 2019, the last trading day
of the year.
|Stock Awards (3)||164,250||164,250||164,250||164,250|
|(1)||Includes cash payments and stock awards for 2019 under the Bonus Plan and amounts contributed to the executive’s 401(k) and
health savings account by the Company in 2019.
|(2)||Consists of life, medical, dental, and disability insurance benefits. The value is based upon the type of insurance coverage
the Company carried for each executive officer as of December 31, 2019, and is valued at the premiums in effect on December 31,
|(3)||Represents shares of common stock that would vest under the terms of the award agreements therefore. Does not include shares
awarded on February 18, 2020 for 2019 performance.
Accrued Pay, Certain Retirement Benefits and Vested Equity
The amounts shown in the table above do
not include payments and benefits to the extent they are provided on a non-discriminatory basis to salaried employees generally
upon termination of employment, or amounts that are fully vested under the terms of the applicable plan, such as accrued salary
and vacation pay.
Change in Control Agreements
First Harrison and First Capital maintain
a Change in Control Agreement dated January 20, 2015 with each of William W. Harrod, Michael C. Frederick, Dennis Thomas,
and Jill Keinsley, each of which was approved by the Board on January 21, 2020 to continue forward for three (3) additional
Upon the occurrence of a change in control
(as defined in the agreement) followed within twelve (12) months of the effective date of the change in control by the voluntary
or involuntary termination of the executive’s employment, other than for “cause” (as defined in the agreement),
the executive will be entitled to certain post-termination payments and benefits. For purposes of this agreement, “voluntary
termination” is limited to the circumstances in which the executive elects to voluntarily terminate his or her employment
within twelve (12) months of the effective date of a change in control following any material demotion, loss of title, office or
significant authority, material reduction in his annual compensation or benefits (other than a reduction affecting the personnel
or the Bank generally), or the relocation of his or her principal place of employment by more than 25 miles from its location immediately
prior to the change in control.
the terms of the agreements, the executive is entitled to receive, as severance pay, a sum equal to three (3) times
the sum of the executive’s wages, salary, bonus, and other compensation, if any, paid (including accrued amounts) by the
Company or the Bank to the executive during the twelve (12) month period ending on the last day of the month preceding the effective
date of the change in control. The executive is entitled to receive this payment in a lump sum no later than thirty (30) days after
the date of his or her termination. In addition to a cash severance payment, the executive is also entitled to continued life,
medical, dental and disability insurance coverage for twelve (12) months following termination of employment. Notwithstanding any
provision in the employment agreements to the contrary, payments and benefits under the agreements are limited so that they will
not constitute excess parachute payments under Section 280G of the Internal Revenue Code.
Following termination of employment for
any reason, each named executive officer is entitled to his or her own non-forfeitable interest in the Bank’s tax-qualified
plans. The tax-qualified benefits are distributed in accordance with each executive’s distribution election.
All payments due under the employment agreements
are guaranteed by First Capital. All reasonable costs and legal fees incurred by an executive under any dispute or question of
interpretation relating to the employment agreements will be paid by First Capital, if the executive is successful on the merits
in a legal judgment, arbitration or settlement.
OTHER INFORMATION RELATING TO DIRECTORS
AND EXECUTIVE OFFICERS
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities
Exchange Act of 1934, as amended, requires the Company’s executive officers and directors, and persons who own more than
10% of any registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with
the Securities Exchange Commission. Executive officers, directors and greater than 10% shareholders are required by regulation
to furnish the Company with copies of all Section 16(a) reports they file.
Based solely on its review of the copies
of the reports it has received and written representations provided to the Company from the individuals required to file the reports,
the Company believes that each of its executive officers, directors and greater than 10% beneficial owners has complied with applicable
reporting requirements for transactions in First Capital common stock during the fiscal year ended December 31, 2019.
Transactions with Related Persons
The Sarbanes-Oxley Act of 2002 generally
prohibits First Capital from extending loans to its executive officers and directors. However, the Sarbanes-Oxley Act contains
a specific exemption from this prohibition for loans by First Harrison to its executive officers and directors in compliance with
federal banking regulations. Federal regulations require that all loans or extensions of credit to executive officers and directors
of insured financial institutions must be made on substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons and must not involve more than the normal risk of repayment
or present other unfavorable features. First Harrison, therefore, is prohibited from making any new loans or extensions of credit
to executive officers and directors at different rates or terms than those offered to the general public. Notwithstanding this
rule, federal regulations permit First Harrison to make loans to its executive officers and directors at reduced interest rates
if the loan is made under a benefit program generally available to all other employees and does not give preference to any executive
officer or director over any other employee. First Harrison currently offers a benefit program to all employees that provides a
discount off the interest rate of any loan; officers are permitted to participate in this benefit program.
The Company does not have a comprehensive
written policy for the review, approval or ratification of certain transactions with related persons. However, in accordance with
banking regulations, the Board reviews all loans made to a director or executive officer in an amount that, when aggregated with
the amount of all other loans to such person and his or her related interests, exceeds the greater of $25,000 or 5% of First Capital’s
capital and surplus (up to a maximum of $500,000) and such loans are approved in advance by a majority of the disinterested members
of the Board. Additionally, as required by the Company’s Code of Ethics and Business Conduct, all executive officers and
directors of the Company must disclose any existing or emerging conflicts of interest to the Company’s President and Chief
Executive Officer. Such potential conflicts of interest include, but are not limited to: (i) the Company conducting business
with or competing against an organization in which a family member of an executive officer or director has an ownership or employment
interest and (ii) the ownership of more than 5% of the outstanding securities or 5% of total assets of any business entity
that does business with or is in competition with the Company.
There are no other transactions or series
of similar transactions between us and any of our directors or executive officers in which the amount involved exceeds $120,000
since the beginning of our last fiscal year, or which are currently proposed.
SUBMISSION OF BUSINESS PROPOSALS
AND SHAREHOLDER NOMINATIONS
that shareholders seek to have included in the proxy statement for the Company’s next annual meeting must be received by
the Company no later than December 14, 2020. If next year’s annual meeting is held on a date more than 30 days
from May 27, 2021, a shareholder proposal must be received within a reasonable time before the Company begins to print and
mail its proxy solicitation materials for such annual meeting. Any such proposals will be subject to the requirements of the proxy
rules adopted by the Securities Exchange Commission.
The Company’s Bylaws provide that,
in order for a shareholder to make nominations for the election of directors or proposals for business to be brought before the
annual meeting, a shareholder must deliver notice of such nominations and/or proposals to the Corporate Secretary not less than
90 nor more than 120 days before the date of the annual meeting; provided that if less than 100 days’ notice of the annual
meeting is given to shareholders, such notice must be delivered not later than the close of the tenth day following the day on
which notice of the annual meeting was mailed to shareholders. A copy of the Bylaws may be obtained from the Company upon request.
The Company encourages shareholders to communicate
with the Board and/or individual directors. Shareholders who wish to communicate with the Board or an individual director should
do so in writing to William W. Harrod, President and Chief Executive Officer of First Capital, Inc., 220 Federal Drive, N.W.,
Corydon, Indiana 47112. Communications regarding financial or accounting policies may be made in writing to the Chairperson
of the Audit Committee, Carolyn E. Wallace, at the same address. All other communications should be sent in writing to the attention
of the Chairperson of the Nominating Committee, Dana Huber, also at the same address.
The Company will pay the cost of this proxy
solicitation. The Company will reimburse brokerage firms and other custodians, nominees and fiduciaries for reasonable expenses
they incur in sending proxy materials to the beneficial owners of First Capital common stock. In addition to soliciting proxies
by mail, directors, officers and regular employees of the Company may solicit proxies personally or by telephone without receiving
A notice of internet availability regarding this proxy statement
and the Company’s Annual Report on Form 10-K has been mailed to persons who were shareholders as of the close of business
on April 2, 2020. Any shareholder who would like to receive a paper copy of the proxy statement or Form 10-K may obtain a
copy by writing to the Corporate Secretary of the Company. The Form 10-K is not to be treated as part of the proxy solicitation
material or as having been incorporated in this proxy statement by reference.
Whether or not you plan to attend the annual
meeting, please vote by marking, signing, dating and promptly returning a proxy card.
|BY ORDER OF THE BOARD OF DIRECTORS|
|Jill R. Keinsley|
April 14, 2020
MMMMMMMMM ENDORSEMENT_LINE______________ SACKPACK_____________ MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5
ADD 6 Shareholder Meeting Notice MMMMMMMMMMMM C 1234567890 MMMMMM Online Go to www.investorvote.com/FCAP or scan the QR code —
login details are located in the shaded bar below. Votes submitted electronically must be received by 1:00 am, EDT on May 27,
2020 1234 5678 9012 345 Important Notice Regarding the Availability of Proxy Materials for the First Capital, Inc. Shareholder
Meeting to be Held on May 27, 2020 Under Securities and Exchange Commission rules, you are receiving this notice that the proxy
materials for the annual shareholders’ meeting are available on the Internet. Follow the instructions below to view the
materials and vote online or request a copy. The items to be voted on and location of the annual meeting are on the reverse side.
Your vote is important! This communication presents only an overview of the more complete proxy materials that are available to
you on the Internet. We encourage you to access and review all of the important information contained in the proxy materials before
voting. The proxy statement and annual report to shareholders are available at: www.investorvote.com/FCAP Easy Online Access —
View your proxy materials and vote. Step 1: Go to www.investorvote.com/FCAP. Step 2: Click on the icon on the right to view meeting
materials. Step 3: Return to the investorvote.com window and follow the instructions on the screen to log in. Step 4: Make your
selections as instructed on each screen for your delivery preferences. Step 5: Vote your shares. When you go online, you can also
help the environment by consenting to receive electronic delivery of future materials. Obtaining a Copy of the Proxy Materials
– If you want to receive a copy of the proxy materials, you must request one. There is no charge to you for requesting a
copy. Please make your request as instructed on the reverse side on or before May 17, 2020 to facilitate timely delivery.2 N O
T C O Y 0384DC
Meeting Notice First Capital, Inc. Annual Meeting of Shareholders will be held on May 27, 2020 at 220 Federal Drive, Corydon,
Indiana 47112, at 12:00 noon Eastern Daylight Time. Proposals to be voted on at the meeting are listed below along with the Board
of Directors’ recommendations. The Board of Directors recommend a vote FOR all the nominees listed, FOR Proposals
2 and 3. 1. Election of Directors: 1 – William W. Harrod 2 – Dana L. Huber 3 – Robert C. Guilfoyle 4 – Lou Ann Moore 2. The ratification
of the appointment of Monroe Shine and Co. as First Capital, Inc.’s independent registered public accounting firm for the
fiscal year ending December 31, 2020. 3. The approval of an advisory vote on the compensation of First Capital, Inc.’s named
executive officers as disclosed in the proxy statement. PLEASE NOTE – YOU CANNOT VOTE BY RETURNING THIS NOTICE. To vote
your shares you must go online or request a paper copy of the proxy materials to receive a proxy card. If you wish to attend and
vote at the meeting, please bring this notice with you. Here’s how to order a copy of the proxy materials and select delivery
preferences: Current and future delivery requests can be submitted using the options below. If you request an email copy, you
will receive an email with a link to the current meeting materials. PLEASE NOTE: You must use the number in the shaded bar on
the reverse side when requesting a copy of the proxy materials. — Internet – Go to www.investorvote.com/FCAP. —
Phone – Call us free of charge at 1-866-641-4276. — Email – Send an email to firstname.lastname@example.org
with “Proxy Materials First Capital, Inc” in the subject line. Include your full name and address, plus the number
located in the shaded bar on the reverse side, and state that you want a paper copy of the meeting materials. To facilitate timely
delivery, requests for a paper copy of proxy materials must be received by May 17, 2020.