FIRST HORIZON CORP

Regulatory Filings • Jan 29, 2021

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

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FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (date of earliest event reported): January 26, 2021

First Horizon Corporation

(Exact Name of Registrant as Specified in Charter)

TN	001-15185		62-0803242
(State or Other Jurisdiction	(Commission File Number)		(IRS Employer
of Incorporation)			Identification No.)
165 Madison Avenue	Memphis	Tennessee	38103
(Address of Principal Executive Office)			(Zip Code)

( 901 ) 523-4444

Registrant’s telephone number, including area code

(Former name or former address, if changed from last report)

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Exchange on which Registered
$0.625 Par Value Common Capital Stock	FHN	New York Stock Exchange LLC
Depositary Shares, each representing a 1/4,000 th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series A	FHN PR A	New York Stock Exchange LLC
Depositary Shares, each representing a 1/400 th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series B	FHN PR B	New York Stock Exchange LLC
Depositary Shares, each representing a 1/400 th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series C	FHN PR C	New York Stock Exchange LLC
Depositary Shares, each representing a 1/400 th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series D	FHN PR D	New York Stock Exchange LLC
Depositary Shares, each representing a 1/4,000 th interest in a share of Non-Cumulative Perpetual Preferred Stock, Series E	FHN PR E	New York Stock Exchange LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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ITEM 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

(e) Adoption of Executive Change in Control Severance Plan

On January 26, 2021, the Board of Directors of First Horizon Corporation (“ First Horizon ”) adopted the Executive Change in Control Severance Plan (“ CIC Plan ”). The CIC Plan became active upon adoption. The CIC Plan applies only to participants, as described below. Currently, the CIC Plan has no participants.

Prior Executive CIC Program

For many years, First Horizon offered certain executive officers change in control severance agreements (“ Legacy CIC Agreements ”). Each Legacy CIC Agreement provided the executive with a significant cash severance benefit, and certain additional other benefits, if a defined change in control (“ CIC ”) event occurred and if the executive’s employment terminated within 36 months after the CIC event either (i) by First Horizon without “ Cause ” or disability, or (ii) by the executive with “ Good Reason .” The amount of the cash severance benefit was equal to a multiple (the “ CIC Multiple ”) multiplied by the sum of the executive’s annual salary plus his or her “ Bonus Amount .” The Bonus Amount was the average of three of the last five annual bonuses paid to the executive, excluding the highest and lowest of the five. Legacy CIC Agreements fell into two groups, known as “ Tiers ,” which differed only in CIC Multiple. Tier 1 Agreements had CIC Multiples of 3, and Tier 2 Agreements had CIC Multiples of 2. Older Legacy CIC Agreements required First Horizon to reimburse the executive for certain excise taxes (a “ Tax Gross-up Feature ”). Legacy CIC Agreements have had no Tax Gross-up Feature since 2008.

The Board has determined to discontinue the prior CIC program. Individual CIC agreements will no longer be offered to executives. Instead, executives selected by the Compensation Committee of the Board will be invited to participate in the new CIC Plan. Legacy CIC Agreements currently in place generally will remain in place, and effectively will be “grandfathered.” The prior CIC program will end over time, through attrition.

CIC Plan Overview

Like the executive CIC program, the new CIC Plan is designed to allow First Horizon to compete for executive talent during normal times, and to provide an incentive for the executive team and key other associates to remain with First Horizon, focused on corporate objectives, during the pursuit, closing, and transition periods that accompany CIC transactions. The CIC Plan provides benefits substantially similar to the post-2008 Legacy CIC Agreements of the prior CIC program, but in the form of a plan document rather than individual contracts.

The key benefit is a cash severance payment equal to a CIC Multiple multiplied by the sum of the participant’s annual salary plus his or her Bonus Amount. The CIC Plan offers three Tiers of participation, each with its own CIC Multiple: the Tier 1 Multiple is 2.5; Tier 2 is 2.0; and Tier 3 is 1.5.

Cash severance is payable if a CIC event occurs and the executive’s employment terminates within 24 months after the CIC event either (i) by First Horizon without Cause or disability or (ii) by the executive with Good Reason. Certain exceptions apply in unusual situations. For example: while retirement is not a Good Reason, termination by mandatory retirement (imposed by First Horizon) is termination by First Horizon without Cause; and, while termination by First Horizon without Cause before, but in anticipation of, a CIC event generally would satisfy the conditions for the cash benefit, termination by the associate (resignation), even with Good Reason, must occur after the CIC event unless First Horizon consents to early departure. Certain notices, documentation, and procedures are required if Cause or Good Reason are claimed.

Cash s everance payments may be reduced to avoid a federal excise tax if the reduced (un-taxed) benefits are greater than the un-reduced (taxed) benefits. The CIC Plan has no Tax Gross-up Feature.

The CIC Plan provides for continued healthcare and life insurance benefits for an 18-month period as allowed by tax laws. Non-disparagement, cooperation, and non-solicitation covenants by each participant are incorporated into the CIC Plan. The CIC Plan does not guarantee employment for any term or period. First Horizon can terminate or adversely amend participation in the CIC Plan unilaterally with 24 months’ prior notice, subject to certain possible extensions.

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A copy of the CIC Plan is filed with this Report as Exhibit 10.1.

Participation

Management and certain highly compensated non-management associates of First Horizon and its subsidiaries are eligible to participate. The Board’s Compensation Committee may select any eligible associate to be offered participation at a Tier chosen by the Committee. Selection is discretionary; no associate has any right to participate. An invited associate may accept or decline participation.

Key Definitions

The CIC Plan contains numerous defined terms; refer to Exhibit 10.1, Section 11. Three definitions are copied here for convenience:

“ Change in Control ” means the occurrence of any one of (and shall be deemed to have occurred on the date of the earliest to occur of) the following events:

| (i) | individuals
who,
on
January
26,
2021,
constitute
the
Board
(the
“ Incumbent
Directors ”)
cease
for
any
reason
to
constitute
at
least
a
majority
of
the
Board,
provided
that
any
person
becoming
a
director
subsequent
to
that
date,
whose
election
or
nomination
for
election
was
approved
by
a
vote
of
at
least
three-fourths
(3/4)
of
the
Incumbent
Directors
then
on
the
Board
(either
by
a
specific
vote
or
by
approval
of
the
proxy
statement
of
the
Company
in
which
such
person
is
named
as
a
nominee
for
director,
without
written
objection
to
such
nomination)
shall
be
an
Incumbent
Director;
provided,
however,
that
no
individual
elected
or
nominated
as
a
director
of
the
Company
initially
as
a
result
of
an
actual
or
threatened
election
contest
with
respect
to
directors
or
as
a
result
of
any
other
actual
or
threatened
solicitation
of
proxies
or
consents
by
or
on
behalf
of
any
person
other
than
the
Board
shall
be
deemed
to
be
an
Incumbent
Director; |
| --- | --- |
| (ii) | any
“Person”
(for
purposes
of
this
definition
only,
as
defined
under
Section
3(a)(9)
of
the
Exchange
Act
as
used
in
Section
13(d)
or
Section
14(d)
of
the
Exchange
Act)
is
or
becomes
a
“beneficial
owner”
(as
defined
in
Rule
13d-3
under
the
Exchange
Act),
directly
or
indirectly,
of
securities
of
the
Company
representing
20%
or
more
of
the
combined
voting
power
of
the
Company’s
then
outstanding
Company
Voting
Securities;
provided,
however,
that
the
event
described
in
this
paragraph
(ii)
shall
not
be
deemed
to
be
a
Change
in
Control
by
virtue
of
any
of
the
following
acquisitions:
(A)
by
the
Company
or
any
Subsidiary,
(B)
by
an
Associate
stock
ownership
or
Associate
benefit
plan
or
trust
sponsored
or
maintained
by
the
Company
or
any
Subsidiary,
(C)
by
any
underwriter
temporarily
holding
securities
pursuant
to
an
offering
of
such
securities,
or
(D)
pursuant
to
a
Non-Qualifying
Transaction
(as
defined
in
paragraph
(iii)
hereof); |
| (iii) | consummation of a merger,
consolidation, share exchange or similar form of corporate transaction involving the Company or any of its Subsidiaries that requires
the approval of the Company’s shareholders, whether for such transaction or the issuance of securities in the transaction
(a “ Business Combination ”), unless immediately following such Business Combination: (A) more than 60% of the
total voting power of (x) the corporation resulting from such Business Combination (the “ Surviving Corporation ”),
or (y) if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership of 100% of the voting
securities eligible to elect directors of the Surviving Corporation (the “ Parent Corporation ”), is represented
by Company Voting Securities that were outstanding immediately prior to the consummation of such Business Combination (or, if
applicable, is represented by shares into which such Company Voting Securities were converted pursuant to such Business Combination),
and such voting power among the holders thereof is in substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business Combination, (B) no Person (other than any Associate benefit
plan sponsored or maintained by the Surviving Corporation or the Parent Corporation), is or becomes the beneficial owner, directly
or indirectly, of 20% or more of the total voting power of the outstanding voting securities eligible to elect directors of the
Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) and (C) at least a majority of the members
of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) were Incumbent
Directors at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination
(any |

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| | Business Combination which satisfies all of the criteria specified
in (A), (B) and (C) above shall be deemed to be a “ Non-Qualifying Transaction ”); |
| --- | --- |
| (iv) | consummation
of
a
sale
of
all
or
substantially
all
of
the
Company’s
assets;
or |
| (v) | the
shareholders
of
the
Company
approve
a
plan
of
complete
liquidation
or
dissolution
of
the
Company. |

Computations required by paragraph (iii) shall be made on and as of the date of shareholder approval and shall be based on reasonable assumptions that will result in the lowest percentage obtainable. Notwithstanding the foregoing, a Change in Control of the Company shall not be deemed to have occurred solely because any Person acquires beneficial ownership of more than twenty percent (20%) of the Company Voting Securities as a result of the acquisition of Company Voting Securities by the Company which reduces the number of Company Voting Securities outstanding; provided, that if after such acquisition by the Company such Person becomes the beneficial owner of additional Company Voting Securities that increases the percentage of outstanding Company Voting Securities beneficially owned by such Person, a Change in Control of the Company shall then occur.

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“ Cause ” means:

| (i) | a Participant’s conviction
of, or plea of guilty or nolo contendere (or similar plea)
to, (A) a misdemeanor charge involving fraud, false statements or
misleading omissions, wrongful taking, embezzlement, bribery, forgery,
counterfeiting, or extortion, (B) a felony charge, or (C) an equivalent
charge to those in clauses (A) and (B) in jurisdictions which do
not use those designations; |
| --- | --- |
| (ii) | a Participant’s engagement in any conduct which constitutes, or
which results in, employment or service disqualification, disbarment, or prohibition under applicable law
or regulations (including under banking, financial industry, or securities laws or regulations); |
| (iii) | a Participant’s knowing violation of any securities or commodities
laws, any rules or regulations issued pursuant to such laws, or the rules and regulations of any securities
or commodities exchange or association of which the Company or any of its Subsidiaries or affiliates is
a member; |
| (iv) | a Participant’s substantial failure to perform his or her duties
to the Company or its Subsidiaries; |
| (v) | a Participant’s knowing and substantial breach of any contract or
agreement with the Company or its Subsidiaries; |
| (vi) | a Participant’s knowing violation of any policy of the Company or
its Subsidiaries concerning hedging, trading, or confidential or proprietary information, or a Participant’s
knowing and substantial violation of any other policy of the Company or of any of its Subsidiaries as in
effect from time to time; |
| (vii) | a Participant’s knowing and substantial unauthorized use, taking,
mis-appropriation, conversion, or disclosure of tangible or intangible property, including information,
of the Company, any of its Subsidiaries, or of any Associate, director, customer, or client of the Company
or any of its Subsidiaries; |
| (viii) | a Participant’s deliberate engagement in any act or deliberate
making of any statement which substantially impairs, impugns, denigrates, disparages, or negatively reflects
upon the name, reputation, or business interests of the Company or any of its Subsidiaries, or upon the
name, reputation, or business interests of any Associate, director, customer, or client of the Company
or any of its Subsidiaries; or |
| (ix) | a Participant’s deliberate engagement in any conduct substantially
detrimental to the Company or its Subsidiaries. |

The determination as to whether Cause has occurred in any given instance shall be made in the sole discretion of the Board or, if so directed by the Board, by the Committee. The Board or Committee, as the case may be, shall also have the authority in its sole discretion to waive the consequences under the Plan of the existence or occurrence of any of the events, acts, or omissions constituting Cause.

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“ Good Reason ” means, with respect to any Participant, any of the following:

(i) an adverse change in the Participant’s status, title or position with the Company as in effect immediately prior to the Change in Control, including, without limitation, any adverse change in the Participant’s status, title or position as a result of a diminution in the Participant’s duties or responsibilities, or the

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| | assignment to the Participant
of any duties or responsibilities which are inconsistent with
such status, title, or position as in effect immediately prior
to the Change in Control, or any removal of the Participant from,
or any failure to reappoint or reelect the Participant to, such
position; |
| --- | --- |
| (ii) | a
reduction
by
the
Company
in
the
Participant’s
cash
salary
or
target
amount
of
annual
cash
incentive
opportunity
under
Participant’s
Bonus
Plan
(including
any
adverse
change
in
the
formula
for
such
annual
cash
incentive)
as
in
effect
immediately
prior
to
the
Change
in
Control
or
as
the
same
may
be
increased
from
time
to
time
thereafter; |
| (iii) | the
failure
by
the
Company
to
provide
the
Participant
with
compensation
plans
that
provide
the
Participant
with
substantially
equivalent
benefits
in
the
aggregate
to
the
compensation
plans
as
in
effect
immediately
prior
to
the
Change
in
Control
(at
substantially
equivalent
cost
to
the
Participant
with
respect
to
welfare
benefit
plans);
and |
| (iv) | the
Company’s
requiring
the
Participant
to
be
based
at
an
office
that
is
greater
than
50
miles
from
where
the
Participant’s
office
is
located
immediately
prior
to
the
Change
in
Control; |

provided, however, that: (a) an action taken in good faith and which is remedied by the Company within ten days after Company’s receipt of the objection notice thereof shall not constitute Good Reason; (b) no action or event shall constitute a Good Reason if the Participant has acknowledged to the Company in writing that a Good Reason will not arise from that action or event; and (c) no action or event shall constitute a Good Reason unless (1) the Participant has given an objection notice to the Company thereof not more than 30 days after the action first was taken or the event first occurred, and (2) the Participant has resigned not less than ten business days after the objection notice has been given to the Company and not more than 90 days after the action first was taken or the event first occurred.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

The following exhibits are filed herewith:

| Exhibit

| Description |

| --- | --- |
| 10.1 | Executive Change in Control Severance Plan |
| 104 | Cover Page Interactive
Data File, formatted in Inline XBRL |

All summaries and descriptions of documents, and of amendments thereto, set forth above are qualified in their entirety by the documents themselves, whether filed as an exhibit hereto or filed as an exhibit to a later report.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

First Horizon Corporation
(Registrant)

Date: January 29, 2021
Clyde A. Billings, Jr.
Senior Vice President, Assistant
General Counsel, and Corporate Secretary

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