DEF 14A of Eagle Financial Services Inc
Filed Apr 8, 2026 · FY20250000880641-26-000009
PROPOSAL ONE - ELECTION OF DIRECTORS
PROPOSAL ONE - ELECTION OF DIRECTORS The Board of Directors of the Company is structured into three classes (I, II, and III) with one class elected each year to serve a three-year term. The term of Class II Directors will expire at the Annual Meeting. The persons named below, all of whom are currently members of the Board, will be nominated to serve as Class II Directors. If elected, the Class II nominees will serve until the 2029 Annual Meeting of Shareholders or until their respective successors are elected and qualified. Additionally, Karthik Shyamsunder and Susan D. Davies were appointed to the Board of Directors in May 2025 and February 2026, respectively, and have been nominated to serve as Class I Directors to serve until the 2028 Annual Meeting of Shareholders or until their respective successors are elected and qualified. Mr. Smalley, a Class I Director, will retire at the Annual Meeting and therefore will not stand for re-election as a Class I Director at the Annual Meeting. All nominees have consented to be named and have indicated their intent to serve if elected. Those nominees receiving the greatest number of votes shall be deemed elected even though they may not receive a majority. Abstentions and broker non-votes will not be considered votes cast and will have no effect on the outcome of this proposal. Certain information concerning the nominees for election at the Annual Meeting is set forth below, as well as certain information about the Class II and III Directors who will continue in office until the 2027 and 2028 Annual Meetings of Shareholders, respectively. The following biographical information discloses each Director’s age, principal occupation during the last five years and the year that each individual was first elected to the Board of Directors of the Company or previously to the Board of Directors of Bank of Clarke (the “Bank”), the predecessor to and now a wholly owned subsidiary of the Company. In addition, the following information includes the particular experiences, qualifications, attributes and skills that lead the Board to conclude that each person should serve as a Director. The Board of Directors recommends a vote FOR the Directors nominees set forth below. Class I (Nominees to serve until the 2029 Annual Meeting): Brandon C. Lorey, 57, has been a director since 2019. Mr. Lorey has been the President and Chief Executive Officer of both the Company and the Bank since July 2019. Prior to joining the Company in 2019, he served as Executive Vice President, Head of Consumer Banking of United Bank, a $7.3 billion asset bank headquartered in Connecticut, since 2015. Previously, he served as Executive Vice President, Consumer Lending from April 2014 to June 2015, and as Senior Vice President, Head of Consumer Lending from February 2013 to April 2014. Prior to joining United Bank and its predecessors, he served as Chief Credit and Lending Officer for H&R Block Bank in Kansas City, Senior Vice President at Sovereign Bank in Pennsylvania and held various roles at Chevy Chase Bank, a Federal Savings Bank in Maryland, including Vice President of risk, finance, operations and direct sales. Douglas C. Rinker, 66, has been a director since 2006. Mr. Rinker is the Chairman of the Board of Winchester Equipment Company, an equipment sales, rental and service company headquartered in Winchester, Virginia. Mr. Rinker also serves as the Senior Pastor of Round Hill Church. As the Chairman of a successful company, Mr. Rinker provides the Board with valuable insight and guidance on the issues of corporate strategy, business growth and risk management. He has demonstrated his commitment to the community by his past service in several community and civic organizations. John D. Stokely, Jr., 73, has been a director since 2006. Mr. Stokely is the former President and owner of Cavalier Land Development Corp., a real estate development company in Oakton, Virginia and is a former President of the Northern Virginia Building Industry Association and the Home Builders Association of Virginia. Mr. Stokely is also a former Chairman and a current Trustee of Shenandoah University as well as a former Trustee of the University of Virginia School of Engineering and Applied Science. His broad experience and perspective as an entrepreneur brings to the Board a substantial resource with respect to finance, strategic planning and corporate governance. Brain T. Strosser, 56, has been a director since February 2026. Mr. Strosser brings deep expertise in strategic governance, risk management, and regulated industry oversight from more than 30 years of senior executive leadership experience across the technology and public‑sector contracting markets. He has served as President, Chief Executive Officer, and board member of multiple technology and solutions companies, overseeing corporate strategy, growth initiatives, mergers and acquisitions, and large‑scale operations. He most recently served as President and board member of ClearShark, leading its expansion and its acquisition by Optiv Security. Class I (Incumbent directors to serve until the 2028 Annual Meeting): Susan D. Davies, 56, has been a director since February 2026. Ms. Davies is a Certified Public Accountant (Maryland) and currently serves as Global Controller and Chief Accounting Officer of Alight, Inc., a publicly traded provider of cloud‑based digital human capital and business solutions, a position she has held since May 2021. In this role, she is responsible for the global controllership and external and regulatory reporting functions, Sarbanes‑Oxley Act compliance, and accounting and reporting for significant capital markets and merger and acquisition transactions, including Alight’s 2021 IPO/SPAC transaction. Prior to joining Alight, Ms. Davies served in senior accounting, controllership, and internal audit leadership roles at Willis Towers Watson, and earlier in her career, at PricewaterhouseCoopers. Ms. Davies brings significant financial leadership and expertise in public-company reporting, financial controls, audit and governance. Karthik Shyamsunder, 56, has been a director since May 2025 Mr. Shyamsunder currently serves as Vice President and Distinguished Engineer at VeriSign Inc., where he has held various leadership roles since 2000. In this capacity, he collaborates with executive leadership and cross-functional teams to develop innovative products and services that support the growth of the .com registry business. Prior to VeriSign, he was a Principal Engineer at AT&T from 1992 to 2000. In addition to his corporate experience, Mr. Shyamsunder has been a faculty member at Johns Hopkins University since 2000, where he coordinates the Big Data and Cloud Computing program and designs and teaches related courses. Mr. Shyamsunder brings over three decades of experience in the technology and telecommunications sectors, with deep expertise in artificial intelligence, machine learning, and cloud computing. Class III (Incumbent directors to serve until the 2027 Annual Meeting): Tatiana C. Matthews, 69, has been a director since 2022.
PROPOSAL ONE - ELECTION OF DIRECTORS
Ms. Matthews is the Co-Founder, President Emerita and Chairman of the Board of the Matthews Group, Inc. t/a TMG Construction Corporation (“TMG”). TMG is a leading design/builder and general contractor serving aviation, institutional, governmental, and military clients nationwide. Woman/Native American (Hawaiian) owned and MBE-certified, TMG specializes in new construction, renovations and additions, and facilities maintenance support under Lump Sum, Indefinite Delivery/Indefinite Quantity Task Order and Job Order contracts. Ms. Matthews has earned five academic degrees and serves on the Board of the Washington Airports Task Force, the National Classification Management Society (where she co-chairs the Industrial Security Professional certification for the Defense Industrial Base), the American Council for Construction Education, and the American Institute of Constructors Education Foundation. Edward Hill, III, 61, has been a director since 2022. Dr. Hill is a physician executive, entrepreneur, clinical and biomedical informatics researcher, and medical jurisprudence professional. He is an MD/JD with 37 years of experience operating and providing board oversight for multiple medical research and information technology-oriented professional services companies. Dr. Hill is a founding member of three companies with offices in Northern Virginia: Forensic Perinatal, Inc., a clinical medical research company; Fetal Cerebral, Inc., a neuro-information technology R&D company; and Alpharix Partners, LLC, a biomedical informatics R&D company. Mary Bruce Glaize, 70, has been a director since 1998. Mrs. Glaize is a retired educator and community volunteer. She is a founder and trustee emerita of the Shenandoah Valley Discovery Museum. Additionally, Mrs. Glaize is an honorary member of the Little Garden Club of Winchester. Her involvement in the communities in which the Company operates allows her to identify the needs of the Bank’s customers. Cary C. Nelson, 51, has been a director since 2018. Mrs. Nelson is the Chair of the Board of both the Company and the Bank. She is the President of H.N. Funkhouser & Company, a family-owned petroleum company founded in 1932 which operates in the Northern Shenandoah Valley of Virginia. Mrs. Nelson is a native of the Winchester/Frederick County, Virginia area. She is a Certified Public Accountant with a Bachelor of Science degree from the University of Richmond. Additionally, Mrs. Nelson is the recent past board chair of the Top of Virginia Regional Chamber and an active member of the Rotary Club of Winchester. Her business experience and skill set are valuable resources to the Company in both her role on the Board of Directors and the Company’s Audit Committee. Class I (Incumbent directors to serve until the 2028 Annual Meeting): Scott M. Hamberger, 55, has been a director since 2016. Mr. Hamberger is an entrepreneur, investor, and philanthropist. He is a founder and previous CEO of Fortessa Tableware Solutions, which he grew to international industry leadership prior to leading a successful merger to form the Zwiesel Fortessa Group. As an entrepreneur and executive, Mr. Hamberger brings analytical ability and leadership skills to his role as director. Additionally, he serves on eight for-profit and non-profit Boards and has served as a Director and Chairman of the Loudoun County Chamber of Commerce, and as a Trustee and Chairman of Inova Loudoun Hospital. By living, volunteering, and operating a business in the Company’s area of operations, Mr. Hamberger can help identify the needs of the Company’s customers and potential customers. John R. Milleson, 69, has been a director since 1999. Mr. Milleson served as the President and Chief Executive Officer of both the Company and the Bank from 1999 to July 2019. From 1997 to 1999, he was Executive Vice President and Secretary-Treasurer of the Company and Executive Vice President and Chief Administrative Officer of the Bank. He brings operational risk management and financial accounting knowledge.
Director Not Standing for Re-Election
Director Not Standing for Re-Election Robert W. Smalley, Jr., 73, has been a director since 1989. Mr. Smalley recently retired from Smalley Properties Inc., a company focused on real estate management in Berryville, Virginia. He is also the Vice Chairman of Loudoun Mutual Insurance Company, a property and casualty insurance provider in the State of Virginia. Mr. Smalley’s institutional knowledge and longstanding board service make him a distinctively qualified member of the board.
Executive Officers Who Are Not Directors
Executive Officers Who Are Not Directors Kathleen J. Chappell, 59, has served as Executive Vice President and Chief Financial Officer of the Company and the Bank since 2019. Previously, she served as Senior Vice President and Chief Financial Officer of the Company and the Bank from 2009 to 2019. From 2005 to 2008 she served as Senior Vice President and Chief Financial Officer of Middleburg Financial Corporation. Kaley P. Crosen, 60, has served as Secretary of the Company and as Executive Vice President and Chief Human Resources Officer of the Bank since 2019. Previously, she served as Senior Vice President and Human Resources Director from 2008 to 2019. Ms. Crosen served as Vice President of Human Resources from 1999 to 2008. Joseph T. Zmitrovich, 56, has served as President and Chief Banking Officer of the Bank since 2022. Previously, he served as Executive Vice President and Chief Banking Officer from 2020 to 2022 and Executive Vice President and Chief Revenue Officer of the Bank from 2019 to 2020. Mr. Zmitrovich served as Senior Vice President and Chief Lending Officer of the Bank from 2016 to 2019. From 2015 to July 2016, he served as Market President of the Southern Pennsylvania region for BB&T. From 2008 to 2015 he served as Senior Vice President and Commercial Executive for Susquehanna Bank.
Director Compensation
Director Compensation The following table provides compensation information for the year ended December 31, 2025, for each non-employee director of the Company’s Board of Directors:
Director Compensation Table
Director Compensation Table
Fiscal Year 2025
| | Fees Earned | | | | | or Paid in Cash | Stock Awards | Total | | Name (1) | ($) | ($) (2) | ($) | | Thomas T. Gilpin | 31,017 | 21,840 | 52,857 | | Mary Bruce Glaize | 28,400 | 21,840 | 50,240 | | Edward Hill, III | 29,800 | 21,840 | 51,640 | | Scott M. Hamberger | 33,200 | 21,840 | 55,040 | | Tatiana C. Matthews | 28,600 | 21,840 | 50,440 | | John R. Milleson | 30,600 | 21,840 | 52,440 | | Cary C. Nelson | 41,400 | 21,840 | 63,240 | | Douglas C. Rinker | 30,600 | 21,840 | 52,440 | | Karthik Shyamsunder | 14,983 | — | 14,983 | | Robert W. Smalley, Jr. | 31,000 | 21,840 | 52,840 | | John D. Stokely, Jr. | 30,800 | 21,840 | 52,640 |
EXECUTIVE COMPENSATION
The performance-based shares granted in 2025 contained vesting conditions whereby the executive was entitled to receive up to 1.5 times the number of target shares depending upon the Company’s three-year average performance for 2025 through 2027 and vesting three years from the grant date. For performance-vested shares, we measure the Company’s Return on Average Assets “ROAA” percentile ranking versus a custom performance peer group of SEC-reporting banks in Virginia and nearby states with median assets comparable to the Company and generally in a range from half to twice our asset level. A portion of each executive’s target performance-vested share grant can be earned based on ROAA percentile ranking for the performance periods defined above:
EXECUTIVE COMPENSATION
For ROAA percentile ranking that falls between the percentiles shown above, straight-line interpolation is used to determine the portion of target award earned. Number of earned shares is capped at 1.5 times target. A participant must be employed on the vesting date of each performance period to receive shares earned for performance during that period. Retirement and Other Benefits: The Company provides additional compensation to the named executive officers through various plans which are also available to some or all of the employees. The Compensation Committee oversees these plans and the Compensation Committee considers these plans when reviewing a named executive officer’s total annual compensation and when determining the annual and long-term compensation components described above. These plans are described below. Employee 401(k) Savings and Stock Ownership Plan The Company sponsors a 401(k) savings plan under which eligible employees, including executive officers, may defer a portion of their salary on a pretax basis, subject to certain IRS limits. The 401(k) plan was amended, effective January 1, 2007, to include a non-elective safe-harbor employer contribution and an age-weighted employer contribution. Qualifying employees will receive a non-elective safe-harbor contribution equal to three percent of their salary with each payroll period during the year. Also, each December 31st, qualifying employees will receive an additional contribution based on their age and years of service. The percentage of salary for the age-weighted contribution increases on both factors, age and years of service, with a minimum of one percent of salary and a maximum of ten percent of salary. In 2025, all executive officers participated in the 401(k) plan and each received all eligible matching contributions under the amended plan. The Company’s contribution to this plan on behalf of each named executive is disclosed in the “Summary Compensation Table” below. Employment Agreements. In order to retain and attract executive officers, the Company recognizes the need to enter into employment agreements with provisions for benefits in connection with a termination of employment. The Compensation Committee evaluates the potential payments to executive officers under various arrangements that provide for severance payments, including termination and change of control arrangements, in connection with its annual review of executive compensation. A description of the terms of our severance plans, the specific circumstances that trigger payment of benefits, an estimate of benefits payable upon the occurrence of those triggering events and other information relating to such plans can be found under the captions of “Employment Agreements” and “Potential Payments upon Termination of Employment or Change-in-Control” below.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| | | | | | Non- | | | | | | | | | Equity | | | | | | | | | Incentive | | | | | | | | | Plan | All Other | | | | | | | Stock | Compen- | Compen- | | | Name and | | Salary | Bonus | Awards | sation | sation | Total | | Principal Position | Year | ($) | ($) | ($) (1) | ($) (2) | ($) (3) | ($) | | Brandon C Lorey | 2025 | 575,000 | — | 222,768 | 267,927 | 52,312 | 1,118,007 | | President and Chief | 2024 | 556,972 | — | 209,820 | 197,634 | 69,375 | 1,033,801 | | Executive Officer | | | | | | | | | Kathleen J. Chappell | 2025 | 349,821 | — | 117,863 | 122,252 | 54,623 | 644,559 | | Executive Vice President and | 2024 | 336,821 | — | 111,000 | 99,597 | 70,728 | 618,146 | | Chief Financial Officer | | | | | | | | | Joseph T. Zmitrovich | 2025 | 419,400 | — | 141,196 | 146,567 | 56,223 | 763,386 | | President and Chief | 2024 | 403,400 | — | 132,960 | 119,284 | 71,158 | 726,801 | | Banking Officer, Bank of Clarke | | | | | | | |
Summary Compensation Table
____________________ (1) The amounts reported reflect the aggregate grant date fair value of the awards computed in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718, Compensation – Stock Compensation (formerly FASB 123R Share–Based Payment). This presentation replaces the dollar amount recognized for financial statements purposes and has been reflected for all fiscal years presented. Stock awards consist of both restricted time and performance-based awards. Performance-based awards in the above table assume the probable outcome of performance conditions is equal to the target potential value of the awards. The maximum value of performance-based awards can equal 1.5 times target should the Company achieve certain performance conditions. Please see page 11 for a detailed discussion of equity compensation. For valuation and discussion of assumptions related to stock and option awards, please refer to Note 11 to the Company’s audited financial statements for the fiscal year ended December 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 16, 2026. (2) This column represents bonus amounts earned under the Company’s Senior Officer Incentive Compensation Plan for achievements relating to Company performance and is discussed in further detail beginning on page 10 under the heading “Annual Incentive Bonus”. Based on the attainment of Company performance goals, the payout, as a percentage of base salary, for the 2025 incentive plan was 46.6% for the President and CEO, 35.0% for the Executive Vice President and CFO and 35.0% for the President and CBO. Based on the attainment of Company performance goals, the payout, as a percentage of base salary, for the 2024 incentive plan was 35.5% for the President and CEO, 29.6% for the Executive Vice President and CFO and 29.6% for the Executive Vice President and CBO. (3) “All Other Compensation” represents matching contributions by the Company to the named executive officer’s account in the Company’s 401(k) plan, dividends paid on unvested equity grants, life insurance premiums and club dues paid on their behalf. The Company has entered into employment agreements with the named executive officers as described below in the “Employment Agreements” section. All compensation paid to the named executive officers is determined as described above in the Executive Compensation section.
Outstanding Equity Awards
Outstanding Equity Awards
Potential Payments upon Termination of Employment or Change-in-Control
Potential Payments upon Termination of Employment or Change-in-Control
Potential Payments Upon Termination Following Change-in-Control
Potential Payments Upon Termination Following Change-in-Control In the event of termination without cause or resignation for good reason following a change in control, the Company’s employment agreements with Mr. Lorey, Ms. Chappell and Mr. Zmitrovich provide for the payments described under “Employment Agreements” above. Additionally, under the terms of the Company’s Stock Incentive Plan, accelerated vesting of both outstanding stock options and restricted stock grants will occur in the event of a change in control. Typically, the payments relating to stock options represent the value of the unvested and accelerated stock options, calculated by multiplying the number of accelerated options by the difference between the exercise price and the closing price of the Company’s Common Stock on the applicable date.
Potential Payments Upon Involuntary Termination Without Cause or Good Reason
Potential Payments Upon Involuntary Termination Without Cause or Good Reason In the event of termination without cause or resignation for good reason, the Company’s employment agreements with Mr. Lorey, Ms. Chappell and Mr. Zmitrovich provide for the payments described under “Employment Agreements” above.
Pay Versus Performance
Pay Versus Performance In accordance with a final rule adopted by the SEC in August 2022 implementing Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are providing the following table that sets forth certain compensation measures for certain of our officers alongside certain performance metrics for the Company:
Pay Versus Performance
| | | | Average | | | | | | | | Summary | Average | Value of | | | | | | Compensation | Compensation | Initial Fixed | | | | | | Table Total | Actually Paid | $100 Investment | | | | Summary | Compensation | for Non-PEO | to Non-PEO | Based on | | | | Compensation Table | Actually Paid | Named Executive | Named Executive | Total Shareholder | Net Income | | | Total for PEO(1) | to PEO(2) | Officers(1) | Officers(2) | Return(3) | (in thousands) | | Year | ($) | ($) | ($) | ($) | ($) | ($) | | 2025 | 1,118,007 | 1,151,125 | 703,973 | 724,319 | 124.39 | 8,214 | | 2024 | 1,033,801 | 1,045,706 | 672,474 | 691,733 | 109.51 | 15,343 | | 2023 | 795,222 | 708,845 | 523,749 | 474,812 | 86.68 | 9,357 |
Pay Versus Performance
___________________ (1) The PEO and non-PEOs for each year are as follows: a. PEO: Brandon C. Lorey b. Non-PEOs were Kathleen J. Chappell and Joseph T. Zmitrovich (2) Compensation Actually Paid is a calculation that begins with the Summary Compensation Table “SCT” total compensation in the given year with certain adjustments prescribed by the SEC rules. The following table provides a reconciliation of SCT total compensation with Compensation Actually Paid:
Pay Versus Performance
| | | | | | | | Change in Fair | | | | | | | | | Change in Fair | Fair Value of | Value of Stock | | | | | | | | Fair Value of | Value of | Stock Awards | Awards from | | | | | | | | Stock Awards | Unvested Stock | Granted and | Prior Years that | Fair Value of | | | | | | SCT Stock | Granted in the | Awards from | Vested in the | Vested in the | Stock Awards | Compensation | | Name | Year | SCT Total | Awards | Covered Year | Prior Years | Covered Year | Covered Year | Forfeited | Actually Paid | | PEO | 2025 | $1,118,007 | $(222,768) | $243,576 | $22,987 | $— | $(486) | $(10,192) | $1,151,125 | | NEO | | | | | | | | | | | Average | 2025 | 703,973 | (129,529) | 141,628 | 13,262 | — | (301) | (4,714) | $724,319 |
Pay Versus Performance
___________________ Total Shareholder Return represents the value of a hypothetical $100 investment beginning at market close on the last day of trading of 2022, assuming reinvestment of all dividends. The relationship between (1) compensation actually paid to the PEO and the average compensation actually paid to NEOs other that the PEO and (2) cumulative total shareholder return on the common stock of the Company for the last two completed fiscal years is as shown in Figure 1.
Figure 1: Compensation Actually Paid and Total Shareholder Return (TSR)
Figure 1: Compensation Actually Paid and Total Shareholder Return (TSR) The relationship between (1) compensation actually paid to the PEO and the average compensation actually paid to NEOs other than the PEO and (2) net income of the Company for the last two completed fiscal years is shown in Figure 2.
Figure 2: Compensation Actually Paid and Net Income
Figure 2: Compensation Actually Paid and Net Income