Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Under the supervision of and with the participation of its management, including the Chief Executive Officer and Chief Financial Officer, Horizon has evaluated the effectiveness of the design and operation of its disclosure controls (as defined in Rule 13a–15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, such officers have concluded that, as of December 31, 2023, Horizon’s disclosure controls and procedures were effective to ensure that the information required to be disclosed by Horizon in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and are designed to ensure that information required to be disclosed in those reports is accumulated and communicated to management as appropriate to allow for timely decisions regarding disclosure.
Management’s Report on Internal Control Over Financial Reporting
Management of Horizon is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rule 13a–15(f) under the Exchange Act. Horizon’s internal control over financial reporting is designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements.
Management assessed the effectiveness of Horizon’s internal control over financial reporting as of December 31, 2023. In making this assessment, management used the criteria set forth in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, management has concluded that Horizon’s internal control over financial reporting as of December 31, 2023 was effective based on the specified criteria.
Remediation
As disclosed in Part II, Item 9A of the Company's Annual Report on Form 10–K for the yer ended December 31, 2022, during the first quarter of 2023 management identified material weaknesses with respect to insufficient controls over the reporting, classification, and disclosure of loans, investments and individual cash flow line items and lack of sufficient controls around the financial reporting process to allow for the timely release of financial statements.
Throughout the year ended December 31, 2023, management implemented its previously disclosed remediation plan to update its design and implementation of controls to remediate the aforementioned deficiencies and enhance the Company's internal control environment, which included:
• Hiring additional resources within our accounting and finance department for financial statement preparation and review and providing additional training to implement and monitor our policies and procedures;
• Enhancing controls with additional procedures for the preparation of financial statement disclosures including the design and implementation of new financial preparation tools to allow more detailed review and documentation for review and procedures relating to the reporting, classification and disclosure of loans, investments and individual cash flow line items in the Company’s financial statements and the calculation of public float for purposes of determining SEC filing deadlines; and
• Developing enhanced documentation and review procedures for financial statement preparation and disclosures, including enhancing the financial statement review process by including additional steps in the review process with respect to the reporting, classification and disclosure of loans, investments and individual cash flow line items in its financial statements and the calculation of the Company’s public float for purposes of determining SEC filing deadlines.
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Horizon’s management completed testing of the implemented controls during the quarter ended December 31, 2023, and found such controls to be operating effectively. As a result, management has concluded that the foregoing material weaknesses in internal control over financial reporting have been remediated as of December 31, 2023.
Attestation Report of Registered Public Accounting Firm
FORVIS, LLP, an independent registered public accounting firm, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023. The report, which expresses an unqualified opinion of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023, is included in this Annual Report on Form 10–K in Item 8, following FORVIS, LLP’s audit report.
Changes in Internal Control Over Financial Reporting
Horizon’s management, including its Chief Executive Officer and Chief Financial Officer, also have concluded that, other than the remediation of the material weaknesses described above, no changes in the Company's internal control over financial reporting (as defined in Rules 13a–15(f) and 15d–15(f) under the Exchange Act) occurred during the fiscal quarter ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Not applicable.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
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HORIZON BANCORP, INC.
PART III
Certain information is omitted from this report pursuant to General Instruction G. (3) of Form 10–K as Horizon intends to file with the Commission its definitive Proxy Statement for its 2024 Annual Meeting of Shareholders (the “Proxy Statement”) pursuant to Regulation 14A of the Exchange Act, not later than 120 days after December 31, 2023.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information relating to Horizon’s directors required by this item is found in the Proxy Statement under “Proposal I — Election of Directors” and is incorporated into this report and item by reference.
The information relating to the Audit Committee of the Board of Directors required by this item is found in the Proxy Statement under “Corporate Governance — Audit Committee” and is incorporated into this report and item by reference.
The information relating to Horizon’s executive officers required by this item is included in Part I of this Form 10–K under “Special Item: Information about our Executive Officers” and is incorporated into this item by reference.
Horizon has no delinquent Section 16(a) filings to report.
Horizon’s “Code of Ethics for Executive Officers and Directors” applies to its directors, chief executive officer and chief financial officer. The code is available on Horizon’s website at http://www.horizonbank.com/ in the section headed “About Us – Investor Relations” under the caption “Corporate Information – Corporate Governance.”
ITEM 11. EXECUTIVE COMPENSATION
The information on executive and director compensation and compensation committee matters required by this item can be found in the Proxy Statement under “Corporate Governance,” “Compensation Committee Report,” “Compensation Discussion and Analysis,” “Executive Compensation Tables” and “Compensation of Directors” and is incorporated into this report and item by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Equity Compensation Plan Information
The following table presents information regarding grants under all equity compensation plans of Horizon through December 31, 2023.
Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted–Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column)
Equity compensation plans approved by security holders 120,680 $ 15.54 1,154,228
Equity compensation plans not approved by security holders — $ — —
120,680 $ 15.54 1,154,228
The other information required by this item can be found in the Proxy Statement under “Common Share Ownership of Management and Certain Beneficial Owners” and is incorporated by reference into this report and item.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this item is found in the Proxy Statement under “Corporate Governance” and “Certain Business Relationships and Transactions” and is incorporated by reference into this report and item.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is incorporated by reference into this report and item from the Proxy Statement section captioned “Auditor Fees and Services.”
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HORIZON BANCORP, INC.
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Documents Filed As Part of This Annual Report on Form 10–K:
1. Financial Statements
The following financial statements are filed as part of this document under Item 8:
Consolidated Balance Sheets at December 31, 2023 and 2022
Consolidated Statements of Income, years ended December 31, 2023, 2022 and 2021
Consolidated Statements of Comprehensive Income, years ended December 31, 2023, 2022 and 2021
Consolidated Statements of Stockholders’ Equity, years ended December 31, 2023, 2022 and 2021
Consolidated Statements of Cash Flows, years ended December 31, 2023, 2022 and 2021 Notes to Consolidated Financial Statements
Reports of Independent Registered Public Accounting Firm
2. Financial Statement Schedules
Financial statement schedules are omitted for the reason that they are not required or are not applicable, or the required information is included in the financial statements.
3. Exhibits
The exhibits filed as part of this report and exhibits incorporated herein by reference to other documents are as follows:
Exhibit
Number Description Incorporated by Reference/Attached
3.1 Amended and Restated Articles of Incorporation of Horizon Bancorp, Inc. effective May 16, 2018
Incorporated by reference to Exhibit 3.1 to Registrant’s Form 8–K filed on May 16, 2018
3.2 Amended and Restated Bylaws of Horizon Bancorp, Inc.
Incorporated by reference to Exhibit 3.2 to Registrant’s Form 8–K filed on December 20, 2022
4.1 Description of Common Stock
Incorporated by reference to Exhibit 4.1 to Registrant's Form 10–K for the year ended December 31, 2020
4.2 Indenture, dated as of October 21, 2004, between Horizon Bancorp and Wilmington Trust Company related to the issuance of Trust Preferred Securities
Incorporated by reference to Exhibit 4.1 to Registrant’s Form 10–K for the year ended December 31, 2009
4.3 Amended and Restated Declaration of Trust of Horizon Bancorp Capital Trust II, dated as of October 21, 2004, related to the issuance of Trust Preferred Securities
Incorporated by reference to Exhibit 4.2 to Registrant’s Form 10–K for the year ended December 31, 2009
4.4 Junior Subordinated Indenture, dated as of December 15, 2006, between Horizon Bancorp and Wilmington Trust Company
Incorporated by reference to Exhibit 4.1 to Registrant’s Form 8–K filed on December 21, 2006
4.5 Amended and Restated Trust Agreement of Horizon Bancorp Capital Trust III, dated as of December 15, 2006
Incorporated by reference to Exhibit 4.2 to Registrant’s Form 8–K filed on December 21, 2006
4.6 Indenture for Subordinated Debt, dated June 24, 2020, between Horizon Bancorp, Inc. and Wilmington Trust, National Association
Incorporated by reference to Exhibit 4.1 to Registrant's Form 8–K filed on June 24, 2020
4.7 First Supplemental Indenture, dated June 24, 2020, between Horizon Bancorp, Inc. and Wilmington Trust, National Association
Incorporated by reference to Exhibit 4.2 to Registrant's Form 8–K filed on June 24, 2020
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Exhibit
Number Description Incorporated by Reference/Attached
10.1* Form of Restricted Stock Award Agreement under 2003 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.7 to Registrant’s Form 10–K for the year ended December 31, 2009
10.2* Form of Option Grant Agreement under 2003 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.8 to Registrant’s Form 10–K for the year ended December 31, 2009
10.3* Horizon Bancorp 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Appendix A to Registrant’s definitive Proxy Statement for its 2014 Annual Meeting of Shareholders
10.4* Form of Nonqualified Stock Option Agreement under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.1 to Registrant’s Form 8–K filed on June 18, 2013
10.5* Form of Nonqualified Stock Option Agreement (Restrictive Covenant) under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.2 to Registrant’s Form 8–K filed on June 18, 2013
10.6* Form of Performance Share Award Agreement under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.1 to Registrant’s Form 8–K filed on March 27, 2017
10.7* Form of Performance Share Award Agreement (Restrictive Covenant) under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.2 to Registrant’s Form 8–K filed on March 27, 2017
10.8* Form of Restricted Stock Award Agreement under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.9 to Registrant’s Form10–K filed on February 28, 2018
10.9* Form of Restricted Stock Award Agreement (Restrictive Covenant) under 2013 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.10 to Registrant’s Form 10–K filed on February 28, 2018
10.10* Horizon Bancorp, Inc. 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Appendix A to Registrant's definitive Proxy Statement for its 2021 Annual Meeting of Shareholders
10.11* Form of Restricted Stock Award Agreement (time–based) under 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.2 to Registrant's Form 8–K filed on May 11, 2021
10.12* Form of Restricted Stock Award Agreement (performance–based) under 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.13 to Registrant's Form 10–K filed on March 9, 2022
10.13* Form of Restricted Stock Unit Award Agreement (time–based) under 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.4 to Registrant's Form 8–K filed on May 11, 2021
10.14* Form of Restricted Stock Unit Award Agreement (performance–based) under 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.15 to Registrant's Form 10–K filed on March 9, 2022
10.15* Form of Stock Option Award Agreement (time–based) under 2021 Omnibus Equity Incentive Plan
Incorporated by reference to Exhibit 10.6 to Registrant's Form 8–K filed on May 11, 2021
10.16* 1997 Supplemental Executive Retirement Plan, as amended and restated as of January 1, 1997, with amendments through December 19, 2017
Incorporated by reference to Exhibit 4.2 to Registrant’s Registration Statement on Form S–8 filed on December 28, 2017 (Registration No. 333-222329)
10.17* 2005 Supplemental Executive Retirement Plan, effective as of January 1, 2005, with amendments through December 19, 2017
Incorporated by reference to Exhibit 4.1 to Registrant’s Registration Statement on Form S–8 filed on December 28, 2017 (Registration No. 333-222329)
10.18* 1998 Directors Deferred Compensation Plan, with amendments through December 19, 2017
Incorporated by reference to Exhibit 4.2 to Registrant’s Registration Statement on Form S–8 filed on December 28, 2017 (Registration No. 333-222330)
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Exhibit
Number Description Incorporated by Reference/Attached
10.19* Amended and Restated 2005 Directors Deferred Compensation Plan, dated December 19, 2017
Incorporated by reference to Exhibit 4.2 to Registrant’s Registration Statement on Form S–8 filed on December 28, 2017 (Registration No. 333-222330)
10.20* Description of Executive Officer Bonus Plan
Incorporated by reference to Exhibit 10.15 to Registrant's Form 10–K for the year ended December 31, 2020
10.21* Employment Agreement (Mark E. Secor), dated as of November 6, 2023
Incorporated by reference to Exhibit 10.1 to Registrant’s Form 8–K filed on November 7, 2023
10.22* Change in Control Agreement (Mark E. Secor), dated January 1, 2020
Incorporated by reference to Exhibit 10.3 to Registrant’s Form 8–K filed on January 7, 2020
10.23* Change in Control Agreement (Kathie A. DeRuiter), dated January 1, 2020
Incorporated by reference to Exhibit 10.4 to Registrant’s Form 8–K filed on January 7, 2020
10.24* Change in Control Agreement (Todd A. Etzler), dated January 1, 2020
Incorporated by reference to Exhibit 10.6 to Registrant’s Form 8–K filed on January 7, 2020
10.25* Amended and Restated Employment Agreement (Thomas M. Prame), dated June 1, 2023
Incorporated by reference to Exhibit 10.1 to Registrant's Form 8–K filed on May 18, 2023
10.26* Amended and Restated Change in Control Agreement (Thomas M. Prame), dated June 1, 2023
Incorporated by reference to Exhibit 10.2 to Registrant's Form 8–K filed on May 18, 2023
10.27* Second Amended and Restated Employment Agreement (Craig M. Dwight), dated September 20, 2022
Incorporated by reference to Exhibit 10.1 to Registrant's Form 8–K filed on September 20, 2022
10.28* Amendment to Change in Control Agreement (Kathie A. DeRuiter), dated December 1, 2022
Incorporated by reference to Exhibit 10.1 to Registrant's Form 8–K filed on December 1, 2022
10.29* Amendment to Change in Control Agreement (Todd A. Etzler), dated December 1, 2022
Incorporated by reference to Exhibit 10.2 to Registrant's Form 8–K filed on December 1, 2022
10.30* Change in Control Agreement (Lynn M. Kerber), dated October 1, 2020
Incorporated by reference to Exhibit 10.33 to Registrant's Form 10–K filed on March 15, 2023
10.31* Amendment to Change in Control Agreement (Lynn M. Kerber), dated December 1, 2022
Incorporated by reference to Exhibit 10.34 to Registrant's Form 10–K filed on March 15, 2023
14 Code of Ethics for Executive Officers and Directors
Incorporated by reference to Exhibit 14 to Registrant’s Form 8–K filed on December 21, 2017
21 Subsidiaries of Horizon
Attached
23 Consent of FORVIS, LLP
Attached
31.1 Certification of Thomas M. Prame pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Attached
31.2 Certification of Mark E. Secor pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Attached
32.1 Certification of Thomas M. Prame pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Attached
32.2 Certification of Mark E. Secor pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Attached
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Exhibit
Number Description Incorporated by Reference/Attached
97 Horizon Bancorp, Inc. Compensation Recovery Policy
Attached
101 Inline Interactive Data Files Attached
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) Embedded Within the Inline XBRL Document
* Indicates exhibits that describe or evidence management contracts or compensatory plans or arrangements required to be filed as exhibits to this Form 10–K.
ITEM 16. FORM 10–K SUMMARY
Not included.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized
Horizon Bancorp, Inc.
Registrant
Date: March 15, 2024 By: /s/ Thomas M. Prame
Thomas M. Prame
Chief Executive Officer (Principal Executive Officer)
Date: March 15, 2024 By: /s/ Mark E. Secor
Mark E. Secor
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Date Signature and Title
March 15, 2024 /s/ Craig M. Dwight
Craig M. Dwight, Chairman of the Board and Director
March 15, 2024 /s/ Kevin W. Ahern
Kevin W. Ahern, Director
March 15, 2024 /s/ Eric P. Blackhurst
Eric P. Blackhurst, Director
March 15, 2024 /s/ Lawernce E. Burnell
Lawernce E. Burnell, Director
March 15, 2024 /s/ James B. Dworkin
James B. Dworkin, Director
March 15, 2024 /s/ Julie Scheck Freigang
Julie Scheck Freigang, Director
March 15, 2024 /s/ Brian W. Maass
Brian W. Maass, Director
March 15, 2024 /s/ Michele M. Magnuson
Michele M. Magnuson, Director
March 15, 2024 /s/ Steven W. Reed
Steven W. Reed, Director
March 15, 2024 /s/ Vanessa P. Williams
Vanessa P. Williams, Director
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