DEF 14A of C & F Financial Corp, Mar 8, 2024

DEF 14A of C & F Financial Corp

Filed Mar 8, 2024 · FY20230000913341-24-000015

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS The Corporation’s Board is divided into three classes (I, II and III) of directors. The term of office for Class I directors will expire at the Annual Meeting. Based on the recommendation of the Nominating Committee, each of Larry G. Dillon, C. Elis Olsson, D. Anthony Peay and Dr. Jeffery O. Smith has been nominated by the Board to serve as a Class I director. If elected, the Class I nominees will serve until the 2027 Annual Meeting of Shareholders. All director nominees currently serve as directors of the Corporation. The Corporation’s Board believes that the nominees will be available and able to serve as directors, but if any of these persons should not be available or able to serve, the proxies may exercise discretionary authority to vote for a substitute proposed by the Nominating Committee. The Board is not aware of any family relationship among any director, director nominee or executive officer; nor is the Board aware of any involvement of any director, director nominee or executive officer, currently or in the past ten years, in any legal proceedings that would be material to an evaluation of the ability or integrity of any director, director nominee or executive officer. None of the directors or director nominees serves, nor in the past five years has any director or director nominee served, as a director of any other public company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE FOUR NOMINEES NOMINATED TO SERVE AS CLASS I DIRECTORS.

  2. Director Nominees and Directors Continuing to Serve

    Director Nominees and Directors Continuing to Serve Certain information concerning the nominees for election at the Annual Meeting as Class I directors is set forth below, as well as certain information about the remaining Class II and III directors who will continue in office until the 2025 and 2026 Annual Meetings of Shareholders, respectively, including the qualifications, skills and experience that the Board believes make the director or director nominee a good fit for service on the Board. The Board of Directors of the Bank (the “Bank Board”) consists of the twelve current members of the Corporation’s Board listed below and Bryan E. McKernon, President and CEO of C&F Mortgage Corporation.

  3. Director Nominees and Directors Continuing to Serve

    | Class I Director Nominees—To Serve Until the 2027 Annual Meeting | | | Name | Principal Occupation During Past Five Years and Qualifications, Skills and Experience | | Larry G. Dillon(1) Director since 1989 Age 71 | Mr. Dillon is the Executive Chairman of the Boards of Directors of the Corporation and the Bank. Mr. Dillon has worked for the Corporation and the Bank for over 46 years and has been Chairman since 1998. He served as Chief Executive Officer from 1989 until December 31, 2018, and as President from 1989 until December 2014. Prior to becoming President and Chief Executive Officer, Mr. Dillon served in several capacities including Chief Operating Officer and Commercial Lending Officer. Mr. Dillon is well versed in all business and operational aspects of the Corporation and the Bank and has the strong leadership qualities that are necessary to lead the Board and Corporation as a whole. In addition to his duties at the Corporation and the Bank, Mr. Dillon has served as president of the Virginia Bankers Association and has served on several committees within that organization. Mr. Dillon has served as a leader in several community organizations in communities served by the Bank. Prior to joining the Bank, Mr. Dillon worked for the State Corporation Commission Bureau of Financial Institutions. All of these experiences provide Mr. Dillon with valuable insights for leading a community bank and serving on the Corporation’s Board. | | C. Elis Olsson Director since 2007 Age 59 | Mr. Olsson is a commercial pilot, and has been employed by International Jet Charter, an aircraft charter and management company, since 2023. He was previously employed as vice president and director of operations for Martinair, Inc. (“Martinair”), an aircraft charter and management company, from 2000 until he retired in 2022. Mr. Olsson, as a vice president of Martinair, in addition to his operational duties, had responsibility for the review of financial information of Martinair. Prior to Martinair, Mr. Olsson worked for a Fortune 500 company where he held numerous roles including regional sales manager and vice president of operations. He also served on the board of directors for the Fortune 500 company. Mr. Olsson is actively involved in various community organizations in the markets the Bank serves. Mr. Olsson’s background brings valuable operational and financial expertise to the Board. | | D. Anthony Peay Director since 2019 Age 64 | Mr. Peay is a retired CPA and community banker with over 39 years of experience in the banking industry. Mr. Peay served as the Chief Financial Officer of Union Bankshares Corporation (now Atlantic Union Bankshares Corporation) for 18 years until his promotion to Chief Banking Officer in 2012, a position he held until his retirement in 2017. During his time with Union Bankshares Corporation, Mr. Peay was a key member of the executive team with responsibility for accounting, financial reporting and investor relations, as well as playing a vital role in the company’s merger and acquisition activity. Mr. Peay has significant experience with the preparation of Securities and Exchange Commission (“SEC”) filings, including periodic and annual reports and registration statements. Mr. Peay’s background enables him to provide significant contributions to the Board regarding the financial performance of the Corporation and its compliance requirements as an SEC registrant, as well as overall management and strategic initiatives. | | Dr. Jeffery O. Smith Director since 2020 Age 56 | Dr. Smith is currently serving as Executive Director and CEO of the Virginia Air & Space Center in Hampton, Virginia. He previously served for over 31 years in public education as an educator and administrator, including working in eight Virginia public school divisions and serving as the superintendent of Hampton City Schools in Hampton, Virginia from 2015 until 2023. Dr. Smith has also been a leader in many community and civic organizations, which has included serving on the boards of directors of Sentara Healthcare, Smart Beginnings Virginia |

  4. Director Nominees and Directors Continuing to Serve

    | Peninsula and Virginia Air & Space Center, and on the board of trustees for the Williamsburg Health Foundation. Dr. Smith’s knowledge of complex organizations, business practices and the communities the Corporation serves enables him to provide significant insights concerning the Corporation’s strategic objectives. |

  5. Director Nominees and Directors Continuing to Serve

    | Class II Directors—Serving Until the 2025 Annual Meeting | | | Name | Principal Occupation During Past Five Years and Qualifications, Skills and Experience | | Audrey D. Holmes Director since 2007 Age 66 | Ms. Holmes owns and operates her own legal practice, Audrey D. Holmes, Attorney-at-Law. Ms. Holmes conducts business in communities served by the Bank. Ms. Holmes’ business experience as a sole practitioner is enhanced by her participation in a number of professional, civic and religious organizations. As a small business owner and through her community involvement, Ms. Holmes understands many of the challenges faced by the Bank’s customers. | | Elizabeth R. Kelley Director since 2017 Age 63 | Ms. Kelley is managing director and co-owner of Blue Heron Management LLC, a business and management consulting and advisory firm and co-owner of Divin’ Off the Dock, Inc. a retail business located in West Point, Virginia. Prior to becoming a consultant and small business owner, Ms. Kelley served as president and chief operating officer of The Martin Agency (“Martin”), an international full-service advertising agency headquartered in Richmond, Virginia, until April 2018. During her tenure at Martin, she worked in a variety of roles including in account management, creative and human resources. She became a partner in 2005, assumed the role of chief operating officer in 2011, and was named president of the agency in 2016. Ms. Kelley previously served on the Hampden-Sydney College board of trustees, and is a member of the West Point Chamber of Commerce. Ms. Kelley has served as a member of the Bank Board since June 2016. Ms. Kelley’s diverse experience in business and strategy, including with a company that specializes in, among other things, advertising, strategic planning, and building the relationship between brand and consumers, brings valuable expertise to the Board. | | James T. Napier Director since 2016 Age 71 | Mr. Napier is the chairman and senior executive officer of Napier Realtors ERA headquartered in Chesterfield County, Virginia, with branch offices serving Powhatan County, Henrico County, the City of Richmond and the tri-cities area. Mr. Napier served as president of the firm from 1991 until January 2023 and has been involved in the real estate business since 1976. Mr. Napier served on the board of directors of Central Virginia Bankshares, Inc. from 1997 until its acquisition by the Corporation in 2013. Since that time, Mr. Napier has served as a member of the Bank Board. Mr. Napier’s experience in real estate, his experience as the president of a real estate company and his years of experience on the board of a community bank provide him with leadership skills and other attributes valuable to service as a director. | | Paul C. Robinson Director since 2000 Age 66 | Mr. Robinson is the president of Francisco, Robinson and Associates, Inc., a real estate brokerage firm. Mr. Robinson has gained practical business experience through 46 years in the real estate business, including 29 years as a firm owner/principal broker. In addition, Mr. Robinson previously served as an elected member of the Board of Supervisors for New Kent County, and has represented New Kent County, Virginia, on multi-jurisdictional boards in the greater Richmond region. Through his experiences in business and government services, Mr. Robinson has developed relevant financial, accounting and compliance knowledge. In addition, Mr. Robinson’s past experience as an elected public official provides insight into the workings of local government, issues facing constituents, many of whom reside in the Bank’s banking footprint, and how to effectively manage input from numerous stakeholders to make the most appropriate decisions. |

  6. Director Nominees and Directors Continuing to Serve

    | Class III Directors —Serving Until the 2026 Annual Meeting | | | Name | Principal Occupation During Past Five Years and Qualifications, Skills and Experience | | Dr. Julie R. Agnew Director from 2017-2022; reappointed 2023 Age 54 | Dr. Agnew is the Richard C. Kraemer Term Professor of Business at William & Mary’s Raymond A. Mason School of Business (“Mason School of Business”). She is the Faculty Executive Director of the Boehly Center for Excellence in Finance at the Mason School of Business. She is a TIAA Institute Fellow, a member of the Wharton School’s Pension Research Council Advisory Board and a Research Associate for the Center for Retirement Research at Boston College. Prior to pursuing her doctorate, Dr. Agnew worked as an analyst in investment banking for Salomon Brothers in New York City and as an equity research associate for Vector Securities International in Chicago. Dr. Agnew was first appointed as a member of the Bank Board in June 2016. Dr. Agnew resigned her positions on the Board and the Bank Board in August 2022 and was reappointed to both boards in January 2023, and during the time between her resignation and reappointment she was briefly employed by Vanguard Investment Group, Inc. Dr. Agnew’s experience enables her to provide significant insights regarding the finances and economic risks of the Corporation. | | J. P. Causey Jr.(1) Director since 1984 Age 80 | Mr. Causey is a self-employed attorney-at-law. Mr. Causey was Plan Administrator for Canal Corporation, formerly Chesapeake Corporation. Mr. Causey previously served as executive vice president, secretary and general counsel for Canal Corporation, formerly an SEC registrant, from 2001 to 2011. Mr. Causey had 27 years of experience with Canal Corporation. During his time with Canal Corporation, Mr. Causey actively participated in the development of corporate strategy and in evaluating risk. Mr. Causey also had direct supervisory responsibility for the corporate legal, communications, human resources, business ethics, environmental compliance and internal audit functions. Mr. Causey played an active part in the drafting and/or review of periodic SEC filings and other corporate communications. Mr. Causey’s background enables him to provide significant contributions with respect to the Corporation’s overall management, as well as with respect to its compliance obligations. | | Thomas F. Cherry Director since 2015 Age 55 | Mr. Cherry is the President and Chief Executive Officer of the Corporation and the Bank. Mr. Cherry has worked for the Corporation and the Bank for over 27 years. He has been Chief Executive Officer since January 1, 2019 and President since December 2014 and was appointed to the Boards of Directors of the Corporation and the Bank in January 2015. Mr. Cherry also previously served as Secretary from 2002 until 2018 and Chief Financial Officer from 2004 until 2016. Mr. Cherry is well versed in all business and operational aspects of the Corporation and the Bank and has strong leadership qualities. In addition to his duties at the Corporation and the Bank, Mr. Cherry has served on several committees of the Virginia Bankers Association. Mr. Cherry has served in several community organizations in communities served by the Bank. Prior to joining the Bank, Mr. Cherry worked for Price Waterhouse LLP (prior to its merger with Coopers & Lybrand to create PwC). All of these experiences provide Mr. Cherry with valuable insights for leading a community bank and serving on the Corporation’s Board. | | George R. Sisson III Director since 2020 Age 70 | Mr. Sisson served on the board of directors of Peoples Bankshares, Incorporated (“Peoples”) and Peoples Community Bank from 1987 until its acquisition by the Corporation in 2020, and served as chairman of the board of directors beginning in 2005. As a director and chairman, Mr. Sisson was involved in setting the strategic objectives of Peoples, establishing corporate policies, approving loans, and leading the organization. Mr. Sisson is currently a real estate agent at Historyland Realty LLC and previously owned and operated Peoples Insurance Agency of Montross from 1976 until he sold it effective January 1, 2020. His experience as a director and small business owner provides him with leadership skills and other attributes valuable to service as a director. |

  7. Director Nominees and Directors Continuing to Serve

    | 1 | If prior to 1994, refers to the year the director joined the Bank Board, prior to the Corporation’s becoming the holding company for the Bank. |

  8. Director Compensation

    Director Compensation The following table provides compensation information for the year ended December 31, 2023 for each non-employee director of the Board.

  9. Director Compensation for 2023

    Director Compensation for 2023

  10. Director Compensation for 2023

    | | Fees | | | | | | Earned or | | | | | | Paid in | Stock | All Other | | | | Cash(2) | Awards(3) | Compensation(4) | Total | | Name(1) | ($) | ($) | ($) | ($) | | Julie R. Agnew | 35,445 | 27,565 | 440 | 63,450 | | J. P. Causey Jr. | 40,245 | 27,565 | 1,810 | 69,620 | | Audrey D. Holmes | 26,985 | 27,565 | 1,810 | 56,360 | | James H. Hudson III | 14,663 | 27,565 | 1,348 | 43,576 | | Elizabeth R. Kelley | 38,245 | 27,565 | 1,810 | 67,620 | | James T. Napier | 34,185 | 27,565 | 1,810 | 63,560 | | C. Elis Olsson | 43,245 | 27,565 | 1,810 | 72,620 | | D. Anthony Peay | 43,245 | 27,565 | 1,810 | 72,620 | | Paul C. Robinson | 36,045 | 27,565 | 1,810 | 65,420 | | George R. Sisson III | 26,985 | 27,565 | 1,810 | 56,360 | | Jeffery O. Smith | 31,185 | 27,565 | 1,810 | 60,560 |

  11. Director Compensation for 2023

    | 1 | Mr. Cherry, the Corporation’s President and CEO, and Mr. Dillon, the Corporation’s Executive Chairman of the Board, are not included in this table. Both are named executive officers of the Corporation who receive no additional compensation for services provided as a director. The compensation received by Messrs. Cherry and Dillon as executive officers of the Corporation is shown in the Summary Compensation Table on page 43. |

  12. Director Compensation for 2023

    | 2 | Includes any fees deferred pursuant to the Corporation’s Non-Qualified Deferred Compensation Plan for Directors and Executives. Under the plan, each director may elect to defer any or all of his or her fees. Deferral elections are made in December of each year for amounts to be earned in the following year. |

  13. Director Compensation for 2023

    | 3 | Reflects the grant date fair value of the restricted stock award granted to each non-employee director on April 18, 2023 under the C&F Financial Corporation 2022 Stock and Incentive Compensation Plan, calculated in accordance with FASB Accounting Standards Codification Topic 718 (“ASC Topic 718”), based on the closing price of the Corporation’s stock on the date of grant. As of December 31, 2023, each director except for Dr. Agnew had 1,050 shares of unvested restricted stock awards outstanding that were issued under the 2013 Stock and Incentive Compensation Plan and the 2022 Stock and Incentive Compensation Plan. Dr. Agnew had 500 shares of unvested restricted stock awards outstanding. |

  14. Director Compensation for 2023

    | 4 | The amounts represent nonforfeitable dividends paid on unvested restricted stock awards granted under the 2013 Stock and Incentive Compensation Plan and 2022 Stock and Incentive Compensation Plan. |

  15. Director Compensation for 2023

    The Compensation Committee, appointed by the Board, annually reviews and evaluates the compensation of the Board, including the appropriate mix of cash and equity compensation. The Compensation Committee recommends changes in compensation to the Board for approval. In June 2021, the Compensation Committee engaged Pearl Meyer & Partners LLC (“Pearl Meyer”), an independent compensation consultant, to update the review of director compensation that was performed in June 2019. The peer group used for the director compensation review was the same peer group used for the 2021 review of President and CEO and CFO compensation, which is described on page 24 under “Compensation Benchmarking and Peer Group Analysis.” The review found that total director compensation, which includes cash and equity, was at the 67th percentile of the peer group. The cash component of director compensation was at the 61st percentile of the peer group. In addition, the review found that the total Board cost was at the 76th percentile. As a result of this review, upon the recommendation of the Compensation Committee, the Board approved certain increases to the Board’s compensation, effective January 1, 2022, January 1, 2023 and January 1, 2024, as discussed further below. During 2023, non-employee members of the Corporation’s Board each received an annual retainer of $13,125. In addition, Ms. Kelley, as Chair of the Corporation’s Compensation Committee, received an additional retainer of $5,800, Mr. Peay, as Chair of the Corporation’s Audit Committee, received an additional annual retainer of $7,200 and Mr. Olsson, as Chair of the Nominating Committee, received an additional annual retainer of $4,200. The retainers are payable in quarterly installments. Each non-employee member of the Corporation’s Board also earned a single fee of $1,260 for attendance at monthly Board, Bank Board, Bank subsidiary board, and Nominating Committee meetings, as applicable. Additionally, each member of the Audit or Compensation Committee earned a fee of $600 for attendance at each meeting of the Audit or Compensation Committee. In addition to cash compensation, non-employee members of the Board were eligible to participate in the 2022 Stock and Incentive Compensation Plan. Under the 2022 Stock and Incentive Compensation Plan, directors were eligible to receive awards of restricted stock units, stock options, stock appreciation rights, restricted stock and other stock-based awards. On April 18, 2023, each non-employee director was granted 500 shares of restricted stock, and the fair value of the restricted stock on the grant date was $55.13 per share. Subject to accelerated vesting under certain circumstances, these shares of restricted stock vest in their entirety on April 16, 2024. Compensation of the non-employee members of the Board for 2024 remains generally the same as it was in 2023, except that the annual retainer for Board service increased to $13,650 from $13,125, the annual retainer for the Chair of the Audit Committee increased to $7,500 from $7,200, the annual retainer for the Chair of the Compensation Committee increased to $6,050 from $5,800, the annual retainer for the Chair of the Nominating Committee increased to $4,400 from $4,200, the monthly attendance fee for Board, Bank Board, Bank subsidiary board and Nominating Committee meetings increased to $1,300 from $1,260, and the attendance fee for Audit or Compensation Committee meetings increased to $625 from $600 per meeting. Holding Period/Stock Ownership Guidelines. Once restricted stock awards vest, non-employee members of the Board may not sell more than 50 percent of the award until a minimum level of stock ownership is achieved. Each non-employee director is required to own shares of the Corporation’s stock having an aggregate value at least equal to three times the amount of the annual Board of Directors retainer paid for regular service on the Board. At January 2, 2024, each non-employee director held an amount of the Corporation’s stock (including restricted stock) that exceeded the minimum level of stock ownership.

  16. Executive Summary

    Total direct compensation as shown above reflects the Committee’s decisions about compensation based on performance for the years indicated. As such, restricted stock grants are included in the year of the performance used in determining the amount of the grant and are shown based on the dollar value of the actual award approved by the Committee. This differs from the Summary Compensation Table on page 43, which includes restricted stock grants in the year in which they are granted based on the grant date closing stock price, which is not always the same as the dollar value of the actual award approved by the Committee. Total direct compensation above for 2023 and 2022 includes restricted stock granted in 2024 based on 2023 performance and restricted stock granted in 2023 based on 2022 performance, respectively, whereas the Summary Compensation Table includes in 2023 and 2022 restricted stock granted in 2023, which was awarded by the Committee based on 2022 performance, and restricted stock granted in 2022, which was awarded by the Committee based on 2021 performance, respectively. Total direct compensation as shown above also excludes perquisites such as personal use of Corporation-owned automobiles and matching charitable contributions and excludes indirect compensation such as compensation related to dividends on unvested stock awards, defined contribution plans or defined benefit plans, whether amounts are accrued or distributed in the current year. Refer to the Summary Compensation Table for further details. Short-Term Cash Incentive. Based on the Corporation’s adjusted ROA and ROE, as defined by the Committee, which excludes the effect on ROE of accumulated other comprehensive income, in 2023 compared to the 2023 Incentive Compensation Peer Group (as defined below) and Mr. Cherry’s recommendation to the Committee that his award be less than the amount allowed, the Committee awarded Mr. Cherry a short-term cash incentive compensation award of $250,000, or 46 percent of his annual base salary and 79 percent of what was allowed to be granted, and awarded Mr. Long a short-term cash incentive compensation award of $128,244, or 45 percent of his annual base salary. The Committee awarded short-term cash incentive compensation awards to Messrs. Dillon, Crone and Seaman of $50,000, $117,415 and $86,000, respectively. The award granted to Mr. Dillon was based on an evaluation of his individual involvement and performance in matters of corporate strategy and governance. The award granted to Mr. Crone was based on the performance of C&F Finance Company (“C&F Finance”) and achievement of strategic objectives. The award granted to Mr. Seaman was based primarily on the net income and asset quality of the Bank. The Committee also awarded an additional discretionary bonus of $31,585 to Mr. Crone for achievement of certain strategic priorities during 2023. See pages 30 to 33 for further details on the 2023 short-term cash incentive compensation awards. Long-Term Equity Incentive. For each NEO except Mr. Dillon, the long-term equity incentive compensation award was in the form of restricted stock, which included an annual component and a performance component and was subject to graded vesting over a period of three years from the date of grant, with one third of the award vesting after each year, with earlier vesting on the later of the date the executive attains age 65 or one year from the grant date for an executive attaining age 65 during the vesting period. The amount of the annual component of the restricted stock award is a fixed value based on a percentage of the target total award value for each NEO. The amount of the performance component was determined by reference to the Corporation’s three-year return on tangible common equity, as defined by the Committee (“ROTCE”), excluding the effect of accumulated other comprehensive income, for the three-year period ending September 30, 2023 compared to the 2023 Incentive Compensation Peer Group (as defined below) and, in the case of Messrs. Crone and Seaman, on their respective business unit performance. The portion of the 2023 long-term equity incentive compensation award granted to each NEO that was attributable to corporate performance was based on 150 percent of the target award value for that component. Based on the performance of the Corporation in 2023 and the incentive-based compensation awards established by the Committee, the Committee could have awarded Mr. Cherry a long-term equity incentive compensation award of up to 56 percent of his annual base salary. Mr. Cherry recommended to the Committee that his award be less than that amount, and the Committee ultimately awarded a long-term equity incentive compensation award to Mr. Cherry of 48 percent of his annual base salary, or 85 percent of what was allowed to be granted. The award granted to Mr. Dillon was based on an evaluation of his involvement and performance in matters of corporate strategy and governance and was subject to cliff vesting one year from the date of grant because Mr. Dillon has attained the age of 65. Long-term equity incentive compensation awards included in 2023 total direct compensation above were granted on February 20, 2024 and are not included in the Summary Compensation Table for 2023. See pages 33 to 36 for further details on the 2023 long-term equity incentive compensation awards. Base Salary. The Committee increased Mr. Cherry’s base salary by 5.0 percent to $546,000 effective January 1, 2023 based on the results of the independent executive compensation review performed in 2021 and in line with market increases for executive compensation. The Committee increased the other NEOs’ base salaries by a range of zero to 5.2 percent effective January 1, 2023, commensurate with broader salary increases in our market, those provided to non-officer employees of the Corporation, changes in individual executives’ responsibilities, and the results of the independent executive compensation review performed in 2021.

  17. Compensation Philosophy and Process

    | ● | Performance driven – Executive compensation is tied to achievement of certain annual and long-term goals, including attainment of both financial performance objectives and strategic business objectives, in some cases relative to peers; |

  18. Compensation Philosophy and Process

    | ● | Shareholder aligned – The benchmarks, objectives, and types of awards included in the executive compensation program are designed to align executives’ interests with those of our shareholders; |

  19. Compensation Philosophy and Process

    | ● | Competitive – Executive compensation packages are intended to attract and retain key executives who are crucial to the long-term growth and profitability of the Corporation; and |

  20. Compensation Philosophy and Process

    | ● | Balanced – Our executive compensation program includes both fixed and variable compensation, short-term and long-term incentives, and cash and equity-based awards, and balances the competitive compensation of executive talent with overall best practices of governance and the safety and soundness of the Corporation. |

  21. Compensation Philosophy and Process

    | ● | Restricted Stock – Equity awards to key employees of the Corporation and its subsidiaries are in the form of restricted stock that is subject to time-based vesting requirements; |

  22. Role of Independent Compensation Consultant

    Role of Independent Compensation Consultant During 2021 and again during 2023, the Committee engaged Pearl Meyer to perform an updated executive compensation review (the “2021 Review” and the “2023 Review”, respectively). The 2021 Review was completed and presented to the Committee in September 2021, and the 2023 Review was completed and presented to the Committee in October 2023. Both reviews were performed to assess the reasonableness of the overall compensation of the President and CEO, the CFO, and certain other senior officers of the Bank. The 2021 Review and the 2023 Review used a peer group analysis and a market analysis. The peer group analysis reviewed base salary, total cash compensation and total compensation. Total compensation for purposes of the peer group analysis included total cash compensation plus equity and retirement compensation. The market analysis reviewed base salary and total cash compensation. During 2021 and 2023, Pearl Meyer did not provide any consulting services to the Corporation other than in connection with non-employee director and executive compensation, and during 2022, Pearl Meyer did not provide any services to the Corporation. Pearl Meyer maintains no other economic relationship with the Corporation. The Committee assessed the independence of Pearl Meyer in 2021 and 2023 pursuant to SEC and NASDAQ rules and concluded that the advice it receives from Pearl Meyer is objective and not influenced by other relationships that could be viewed as conflicts of interest.

  23. Compensation Benchmarking and Peer Group Analysis

    Compensation Benchmarking and Peer Group Analysis 2021 Executive Compensation Review. The 2021 Review comprised an analysis of publicly available and proprietary market data for the purpose of developing an indication of the level of compensation that is competitive for the President and CEO, the CFO, and certain other senior officers of the Bank, relative to the Corporation’s industry and asset size. The 2021 Review was based on the following sources of market data:

  24. Compensation Benchmarking and Peer Group Analysis

    | ● | Pearl Meyer: 2020 National Banking Compensation Survey Report, |

  25. Compensation Benchmarking and Peer Group Analysis

    | ● | McLagan’s 2020 Regional Banking Compensation Survey, |

  26. Compensation Benchmarking and Peer Group Analysis

    | ● | Kenexa’s 2020 CompAnalyst compensation database, |

  27. Compensation Benchmarking and Peer Group Analysis

    | ● | Proxy data from 2020 for a group of peer companies and |

  28. Compensation Benchmarking and Peer Group Analysis

    | ● | Other additional Pearl Meyer proprietary survey sources |

  29. Compensation Benchmarking and Peer Group Analysis

    The analysis of market data concluded that actual total cash compensation for the President and CEO, CFO, and Chief Credit Officer of the Bank (“CCO”) were approximately at the 44th, 38th and 52nd percentile, respectively, of the composite market data for their respective positions. The market data analysis described above included, as a component, a review of proxy data of a group of peer companies (the “2021 Compensation Benchmarking Peer Group”) consisting of 24 publicly-traded commercial financial institutions headquartered in Virginia, Kentucky, Maryland, North Carolina, South Carolina, Tennessee and West Virginia, ranging in asset size from approximately $1.3 billion to $3.4 billion. The median asset size of the financial institutions in this peer group as of December 31, 2020 was $1.8 billion compared to the Corporation’s consolidated total assets at December 31, 2020 of $2.1 billion. Based on these criteria, the following financial institutions were included in the 2021 Compensation Benchmarking Peer Group:

  30. Compensation Benchmarking and Peer Group Analysis

    | 2021 Compensation Benchmarking Peer Group | | | American National Bankshares Inc. (VA) | National Bankshares, Inc. (VA) | | Blue Ridge Bankshares, Inc. (VA) | Old Point Financial Corporation (VA) | | CapStar Financial Holdings, Inc. (TN) | Partners Bancorp (MD) | | Community Bankers Trust Corporation (VA) | Peoples Bancorp of North Carolina, Inc. (NC) | | First Community Bankshares, Inc. (VA) | Primis Financial Corporation (VA) | | First Community Corporation (SC) | Reliant Bancorp, Inc. (TN) | | First United Corporation (MD) | Select Bancorp, Inc. (NC) | | FVCBankcorp, Inc. (VA) | Shore Bancshares, Inc. (MD) | | Howard Bancorp, Inc. (MD) | SmartFinancial, Inc. (TN) | | Limestone Bancorp, Inc. (KY) | Southern First Bancshares, Inc. (SC) | | MainStreet Bancshares, Inc. (VA) | Summit Financial Group, Inc. (WV) | | MVB Financial Corporation (WV) | The Community Financial Corporation (MD) |

  31. Compensation Benchmarking and Peer Group Analysis

    The peer group analysis indicated that total cash compensation of Mr. Cherry, CEO, and Mr. Long, CFO, were at the 38th and 42nd percentile, respectively, of the 2021 Compensation Benchmarking Peer Group. Total direct compensation, which includes cash compensation and long-term incentive compensation, was analyzed based on the target level of incentive award opportunities. Based on the target level of incentive award opportunities, total direct compensation of Messrs. Cherry and Long were at the 51st and 43rd percentile, respectively, of the 2021 Compensation Benchmarking Peer Group. The peer group analysis also included proxy data on Chief Credit Officers, however a majority of institutions in the 2021 Compensation Benchmarking Peer Group did not report compensation of a Chief Credit Officer. In evaluating the results of the 2021 Review, the Committee considered roles and responsibilities, experience, tenure, performance and other factors with respect to each executive’s pay positioning compared to these results. In consideration of these factors, the results of the 2021 Review concluded that base salary for our President and CEO was below the median in our market and that overall executive compensation for our executive officers was competitive with the market. The Committee considered these results when making 2023 executive compensation decisions, including in particular regarding the salary levels of Messrs. Cherry, Long and Seaman relative to the observed median salary for each respective position from the peer group analysis and market analysis of the 2021 Review. 2023 Executive Compensation Review. The 2023 Review comprised an analysis of publicly available and proprietary market data for the purpose of developing an indication of the level of compensation that is competitive for the President and CEO, the CFO, and certain other senior officers of the Bank, relative to the Corporation’s industry and asset size. The 2023 Review was based on the following sources of market data:

  32. Compensation Benchmarking and Peer Group Analysis

    | ● | Pearl Meyer: 2022 National Banking Compensation Survey Report, |

  33. Compensation Benchmarking and Peer Group Analysis

    | ● | 2023 CompAnalyst compensation database, |

  34. Compensation Benchmarking and Peer Group Analysis

    | ● | Proxy data from 2022 for a group of peer companies and |

  35. Compensation Benchmarking and Peer Group Analysis

    | ● | Other additional Pearl Meyer proprietary survey sources |

  36. Compensation Benchmarking and Peer Group Analysis

    The analysis of market data concluded that actual total cash compensation for the President and CEO, and the CFO were approximately at the 50th percentile and that actual total cash compensation for the CCO was approximately at the 55th percentile of the composite market data for their respective positions. Total direct compensation, which includes cash compensation and long-term incentive compensation, was analyzed based on the target level of incentive award opportunities. Based on the target level of incentive award opportunities, total direct compensation of the President and CEO, the CFO, and the CCO were at the 65th, 55th and 35th percentiles, respectively, of the composite market data for their respective positions. The market data analysis described above included, as a component, a review of proxy data of a group of peer companies (the “2023 Compensation Benchmarking Peer Group”) consisting of 26 publicly-traded commercial financial institutions headquartered in Virginia, Maryland, North Carolina, Pennsylvania, South Carolina, Tennessee and West Virginia, ranging in asset size from approximately 50 percent to 200 percent of the Corporation’s size and having similar loan portfolio composition to the Corporation. The median asset size of the financial institutions in this peer group as of December 31, 2022 was $2.7 billion compared to the Corporation’s consolidated total assets at December 31, 2022 of $2.3 billion. Based on these criteria, the following financial institutions were included in the 2023 Compensation Benchmarking Peer Group:

  37. Compensation Benchmarking and Peer Group Analysis

    | 2023 Compensation Benchmarking Peer Group | | | ACNB Corporation (PA) | HomeTrust Bancshares, Inc. (NC) | | American National Bankshares Inc. (VA) | MainStreet Bancshares, Inc. (VA) | | Blue Ridge Bankshares, Inc. (VA) | Mid Penn Bancorp, Inc. (PA) | | CapStar Financial Holdings, Inc. (TN) | MVB Financial Corporation (WV) | | Carter Bankshares, Inc. (VA) | National Bankshares, Inc. (VA) | | Codorus Valley Bancorp, Inc. (PA) | Old Point Financial Corporation (VA) | | Eagle Financial Services, Inc. (VA) | Orrstown Financial Services, Inc. (PA) | | F&M Bank Corp (VA) | Peoples Bancorp of North Carolina, Inc. (NC) | | First Community Bankshares, Inc. (VA) | Primis Financial Corporation (VA) | | First Community Corporation (SC) | SmartFinancial, Inc. (TN) | | First National Corporation (VA) | Southern First Bancshares, Inc. (SC) | | First United Corporation (MD) | Summit Financial Group, Inc. (WV) | | FVCBankcorp, Inc. (VA) | Virginia National Bankshares Corporation (VA) |

  38. Compensation Benchmarking and Peer Group Analysis

    The peer group analysis indicated that total cash compensation of Mr. Cherry, CEO, and Mr. Long, CFO, were at the 51st and 41st percentile, respectively, of the 2023 Compensation Benchmarking Peer Group. Total direct compensation, which includes cash compensation and long-term incentive compensation, was analyzed based on the target level of incentive award opportunities. Based on the target level of incentive award opportunities, total direct compensation of Messrs. Cherry and Long were at the 54th and 44th percentile, respectively, of the 2023 Compensation Benchmarking Peer Group. The peer group analysis also included proxy data on Chief Credit Officers, however a majority of institutions in the 2023 Compensation Benchmarking Peer Group did not report compensation of a Chief Credit Officer. In evaluating the results of the 2023 Review, the Committee considered roles and responsibilities, experience, tenure, performance and other factors with respect to each executive’s pay positioning compared to these results. In consideration of these factors, the results of the 2023 Review concluded that overall executive compensation for our executive officers was competitive with the market. Performance Relative to Peers. The Committee believes that in order to properly align executive compensation with performance and to reward achievement in accordance with the Corporation’s compensation philosophy, an evaluation of the Corporation’s performance must include a relative assessment of the performance of the Corporation and the performance of similarly situated peer companies. As such, the Committee uses a group of peer companies for assessing relative performance of the Corporation in determining incentive compensation awards. Similar criteria as the 2023 Compensation Benchmarking Peer Group, described above, were used to determine the relative performance peer group for 2023, except that the geographic bounds of the relative performance peer group was expanded to include Virginia, Alabama, Florida, Georgia, Indiana, Maryland, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee and West Virginia, and excluded certain large metropolitan areas that do not reflect the economic markets served by the Corporation. From year to year, the Corporation updates the companies meeting the criteria of the relative performance peer group, with the companies included subject to change as the peer group is updated to account for changes in asset size due to mergers, acquisitions or growth. In 2023, the peer group used for assessing relative performance of the Corporation for incentive compensation awards (the “2023 Incentive Compensation Peer Group”) consisted of 53 publicly-traded commercial financial institutions which were still in existence and reported financial performance as of December 31, 2023. Total assets for this peer group were between $1.2 billion and $5.0 billion, with a median asset size of $2.3 billion based on total assets as of December 31, 2022, compared to the Corporation’s consolidated total assets at December 31, 2022 of $2.3 billion. Based on these criteria, the following financial institutions were included in the 2023 Incentive Compensation Peer Group:

  39. Compensation Benchmarking and Peer Group Analysis

    | 2023 Incentive Compensation Peer Group | | | ACNB Corporation (PA) | FVCBankcorp, Inc. (VA) | | American National Bankshares Inc. (VA) | HomeTrust Bancshares, Inc. (NC) | | AmeriServ Financial, Inc. (PA) | John Marshall Bancorp, Inc. (VA) | | Blue Ridge Bankshares, Inc. (VA) | LCNB Corporation (OH) | | Burke & Herbert Financial Services Corp. (VA) | MainStreet Bancshares, Inc. (VA) | | Capital City Bank Group, Inc. (FL) | Mid Penn Bancorp, Inc. (PA) | | CapStar Financial Holdings, Inc. (TN) | Middlefield Banc Corp. (OH) | | Carter Bankshares, Inc. (VA) | National Bankshares, Inc. (VA) | | CB Financial Services, Inc. (PA) | Norwood Financial Corporation (PA) | | CF Bankshares, Inc. (OH) | Ohio Valley Banc Corp. (OH) | | Citizens & Northern Corporation (PA) | Old Point Financial Corporation (VA) | | Citizens Financial Services, Inc. (PA) | Orrstown Financial Services, Inc. (PA) | | Civista Bancshares, Inc. (OH) | Penns Woods Bancorp, Inc. (PA) | | Codorus Valley Bancorp, Inc. (PA) | Peoples Bancorp of North Carolina, Inc. (NC) | | Colony Bankcorp, Inc. (GA) | Peoples Financial Services, Inc. (PA) | | Eagle Financial Services, Inc. (VA) | Primis Financial Corporation (VA) | | F&M Bank Corp (VA) | Princeton Bancorp, Inc. (NJ) | | Farmers & Merchants Bancorp, Inc. (OH) | Richmond Mutual Bancorp, Inc. (IN) | | Fidelity D&D Bancorp, Inc. (PA) | River Financial Corporation (AL) | | First Community Bankshares, Inc. (VA) | SB Financial Group, Inc. (OH) | | First Community Corporation (SC) | Security Federal Corporation (SC) | | First Financial Corporation (IN) | SmartFinancial, Inc. (TN) | | First National Corporation (VA) | Southern First Bancshares, Inc. (SC) | | First Savings Financial Group, Inc. (IN) | Southern States Bancshares, Inc. (AL) | | First United Corporation (MD) | Summit Financial Group, Inc. (WV) | | FNCB Bancorp, Inc. (PA) | Virginia National Bankshares Corporation (VA) | | Franklin Financial Services, Inc. (PA) | |

  40. Elements of Executive Compensation

    Elements of Executive Compensation The Corporation’s executive compensation program consists of fixed and variable compensation in the form of cash and equity, as well as compensation through tax-qualified and nonqualified retirement and other deferred compensation plans and certain reasonable perquisites. The Committee uses these elements in combination, guided by the four principles of our compensation strategy identified in “Overall Philosophy” on page 22, to provide compensation to our executives that is consistent with our compensation philosophy. Each element of executive compensation, including the purpose of each element and how the Committee determines the amount of each element, is discussed in further detail below. Base Salary. We provide base salaries to compensate NEOs for services rendered during the fiscal year and to attract and retain talented executives. Base salaries for the CEO, CFO and CCO are determined based on their positions and responsibilities by using market data. Salary levels are considered annually as part of the Committee’s performance review process as well as upon a promotion or other change in job responsibilities. The Committee targets base salaries for executives at the median of the Corporation’s peer financial institutions in the 2021 Compensation Benchmarking Peer Group, while providing a competitive total compensation package through other elements of the executive compensation program. During its review of base salaries for executives for 2023, the Committee primarily considered:

  41. Elements of Executive Compensation

    | ● | Market data provided by Pearl Meyer in 2021; |

  42. Elements of Executive Compensation

    | ● | Compensation data for the 2021 Compensation Benchmarking Peer Group; |

  43. Elements of Executive Compensation

    Short-Term Cash Incentive Compensation Award. The primary form of variable cash compensation for executives, except Mr. Dillon, is the short-term cash incentive compensation award under the MIP. The Committee awards short-term cash incentive compensation awards to reward executives for achievement of specific goals selected by the Committee in order to generate and sustain long-term shareholder value. Under the MIP, at the beginning of 2023, the Committee established the performance criteria and the award formula or matrix by which short-term cash incentive compensation awards under the MIP were to be determined. The Committee selects performance criteria and grants short-term cash incentive compensation awards based on the Corporation’s long-term strategy and competitive priorities. The Committee selected corporate, business unit, and individual performance criteria, which may be measured in some cases using objective performance metrics compared to a peer group and a formula or matrix to calculate a short-term cash incentive compensation award amount, and in other cases using qualitative performance outcomes. Under the Corporation’s MIP, performance criteria for incentive compensation awards vary based on the position and responsibilities of each executive officer. The Committee may use discretion to adjust any short-term cash incentive compensation award if it determines such an adjustment would be in the best interests of the Corporation and its shareholders. The Committee also set a target award amount as a percentage of annual base salary for each executive officer other than Mr. Crone, whose award is calculated by reference to the performance criteria for such award. Mr. Dillon’s short-term cash incentive compensation opportunity is not covered by the MIP. Mr. Dillon’s short-term cash incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance. The Committee may determine an award amount that is up to 20 percent of Mr. Dillon’s base salary. During the Committee’s review of performance criteria in connection with 2023 short-term cash incentive compensation awards, the Committee approved changes in the short-term cash incentive compensation awards for the President and CEO and the CFO effective in 2023. The changes updated the performance measure used for determining achievement of the awards’ goals. The performance measure is a composite ranking of the Corporation’s ROE and ROA performance compared to a peer group. Beginning in 2023, ROE is defined by the Committee to exclude the effect of accumulated other comprehensive income as a component of equity, based on the wide range of effects on ROE of unrealized losses on available for sale securities due to rising interest rates within the peer group used in 2022. The Committee determined that for purposes of measuring performance under the short-term cash incentive compensation award, comparisons of ROE between the Corporation and the financial institutions of the peer group should not be affected to such a significant degree by changes in the fair value of an investment portfolio that do not affect net income, and particularly not in a manner that rewards institutions with greater unrealized losses. The Committee believes that defining ROE to exclude the effect of accumulated other comprehensive income as a component of equity better aligns the incentives of the President and CEO and the CFO with the objectives of the Corporation and the long-term interests of shareholders. The following table shows the targets, outcomes of calculated performance measures, and actual awards granted under the 2023 short-term cash incentive compensation award.

  44. Elements of Executive Compensation

    | | | Short-Term Cash Incentive Compensation Award | | | | | | | | | | Target | Calculated | Calculated | | Actual | | | | | Base | Award as % | Award as % | Award as % | Calculated | Award as % | Actual | Discretionary | | | Salary | of Base(1) | of Target1, 2 | of Base | Award | of Base | Award | Bonus | | | ($) | (%) | (%) | (%) | ($) | (%) | ($) | ($) | | Thomas F. Cherry | 546,000 | 45 | 129 | 58 | 317,556 | 46 | 250,000 | — | | Jason E. Long | 283,500 | 35 | 129 | 45 | 128,244 | 45 | 128,244 | — | | Larry G. Dillon | 250,000 | 20 | 100 | 20 | 50,000 | 20 | 50,000 | — | | S. Dustin Crone | 305,000 | n/a | n/a | 38 | 117,415 | 38 | 117,415 | 31,585 | | John A. Seaman, III | 248,000 | 25 | 140 | 35 | 86,000 | 35 | 86,000 | — |

  45. Elements of Executive Compensation

    | 1 | The short-term cash incentive compensation award amount for Mr. Crone is determined based on the profitability of C&F Finance and certain other performance criteria as discussed below. Mr. Dillon’s short-term cash incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance and has a target and maximum of 20 percent of Mr. Dillon’s base salary. |

  46. Elements of Executive Compensation

    | 2 | The short-term cash incentive compensation award for Messrs. Cherry and Long is based on corporate and individual performance criteria, discussed in further detail below, which are evaluated individually and collectively by the Committee in determining the award amount. The short-term cash incentive compensation award for Mr. Seaman is based primarily on the net income and asset quality of the Bank, along with other department and individual performance criteria. These performance criteria are not entirely measured using objective metrics or a formula in order to calculate an award amount. |

  47. Elements of Executive Compensation

    President/CEO and CFO. For Mr. Cherry and Mr. Long, the short-term cash incentive compensation award is designed to reward overall corporate performance. Performance is evaluated by determining a composite ranking of the Corporation’s ROE and ROA performance, as defined by the Committee, among the financial institutions of the 2023 Incentive Compensation Peer Group. ROE and ROA have been defined by the Committee, for purposes of the short-term cash incentive compensation award, as net income divided by average equity excluding any average accumulated other comprehensive income, and average assets, respectively, in each case as may be adjusted by the Committee to exclude the effects of nonrecurring items of income or expense or other similar items. The Committee established threshold, target and maximum performance levels for the composite ranking, expressed as a percentile, and corresponding award amounts as a percentage of the target award amount as shown in the table below. Performance outcomes between the threshold and target levels and between the target and maximum levels result in a calculated award amount determined using a straight-line interpolation.

  48. Elements of Executive Compensation

    | 1 | The maximum calculated short-term cash incentive compensation award under the MIP is 200 percent of the target award amount and results from a composite ranking that is (1) at or above the 90th percentile relative to the 2023 Incentive Compensation Peer Group and (2) first among Virginia banks in the 2023 Incentive Compensation Peer Group. Otherwise, the award amount corresponding to the 90th percentile performance level is 175 percent of the target award amount. |

  49. Elements of Executive Compensation

    The composite ranking is based on the rankings of each financial institution based on ROE and ROA, as defined by the Committee, which excludes the effect on ROE of accumulated other comprehensive income. The Committee may adjust the ROE and ROA of the Corporation and the financial institutions in the peer group for nonrecurring items of income or expense or other similar items. For 2023, the Committee considered the effects on ROE and ROA for the Corporation and its peers related to various nonrecurring and other similar items, and included adjustments for one peer company’s gains and related activity arising from a significant divestiture in order to better reflect the ongoing profitability of each institution in the peer group. In the composite ranking, the ROE ranking is weighted two-thirds and the ROA ranking is weighted one-third as shown in the table below. Based on the adjusted ROE and adjusted ROA for 2023, as defined by the Committee, of the Corporation and the financial institutions of the 2023 Incentive Compensation Peer Group, the Corporation achieved results at the 72nd percentile.

  50. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    2023 Performance Relative to 2023 Incentive Compensation Peer Group

  51. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ROE Ranking | ROA Ranking | Composite Ranking (Percentile) | Calculated Award Amount (% of Target) | | 14th out of 54 (Weighted 66 (2)/3%) | 15th out of 54 (Weighted 33 (1)/3%) | 16th out of 54 (72nd) | 129% |

  52. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    The Corporation’s ROE/ROA composite ranking resulted in a calculated award amount of $317,556 for Mr. Cherry and $128,244 for Mr. Long. The calculated award amount may be adjusted by the Committee. In particular, the Committee considers asset quality at the Bank, C&F Mortgage and C&F Finance in evaluating whether the full calculated award amount has been earned, and may use other factors in its discretion to adjust the award amount. Based on its consideration of the calculated award amount, asset quality and other factors, including the recommendation from Mr. Cherry to the Committee that his award be less than the calculated award amount, the Committee awarded Mr. Cherry a short-term cash incentive compensation award of $250,000, or 46 percent of his annual base salary and awarded Mr. Long a short-term cash incentive compensation award of $128,244, or 45 percent of his annual base salary. Other NEOs. Mr. Dillon’s short-term cash incentive compensation award, which is not under the MIP, is based on an evaluation of his individual involvement and performance in matters of corporate strategy and governance. The Committee may determine an award amount that is up to 20 percent of Mr. Dillon’s base salary. Based on the outcomes of these performance criteria, the Committee awarded Mr. Dillon a short-term cash incentive compensation award equal to 20 percent of his annual base salary. Mr. Crone’s short-term cash incentive compensation award amount is determined based on the sum of two components. The first component is the product of an award percentage and the net income of C&F Finance. The maximum award percentage for the first component is determined on a sliding scale based on the ROA of C&F Finance and can be at most 1.35 percent. Based on the 2023 ROA of C&F Finance, the maximum award percentage was 0.90 percent. In determining an award percentage within the award percentage range, the Committee considers the following indicators of performance:

  53. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Delinquency on loans at C&F Finance, |

  54. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Charge off rates, |

  55. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Loan growth, |

  56. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Net income and net income relative to budget, |

  57. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Performance of Mr. Crone’s subordinates at C&F Finance and |

  58. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    | ● | Results of audit and regulatory examinations related to C&F Finance. |

  59. 2023 Performance Relative to 2023 Incentive Compensation Peer Group

    The second component is based on achievement of individual strategic objectives included in the Corporation’s strategic plan, whereby the Committee can award Mr. Crone a short-term cash incentive up to 30 percent of his base salary. Based on the outcomes of these performance criteria, the Committee awarded Mr. Crone a short-term cash incentive compensation award equal to 0.9 percent of the net income of C&F Finance for the first component and 30 percent of his base salary for the second component. The sum of both components represents a total short-term cash incentive award of 38 percent of Mr. Crone’s base salary. The Committee also awarded Mr. Crone an additional discretionary bonus of $31,585 for achievement of key strategic priorities during 2023. Mr. Seaman’s short-term cash incentive compensation award is based primarily on the net income and asset quality of C&F Bank, evaluated relative to historical trends and relative to the 2023 Incentive Compensation Peer Group, along with other department and individual performance criteria. The Committee may determine an award amount for Mr. Seaman of up to 200 percent of the target award amount based on an evaluation of these performance criteria. For 2023, the Committee awarded Mr. Seaman a short-term cash incentive compensation award equal to 140 percent of the target award amount, which represents 35 percent of Mr. Seaman’s base salary. Long-Term Equity Incentive Compensation Award. The Corporation grants equity compensation to executives in order to provide long-term incentives to achieve corporate objectives and generate and sustain shareholder value without exposing the Corporation or its subsidiaries to imprudent risks, and to align their personal interests with the long-term financial success of the Corporation. Long-term equity incentive compensation awards are established under the MIP, except for Mr. Dillon, and equity securities are issued pursuant to the 2022 Stock and Incentive Compensation Plan in the form of restricted stock, restricted stock units, stock options, stock appreciation rights or other stock-based awards. The primary form of equity awards granted by the Committee is restricted stock. All awards of restricted stock to executive officers are subject to graded vesting over a period of three years, with one third of the award vesting after each year, on condition of continuous employment with the Corporation or its subsidiaries, and any unvested shares are forfeited upon termination prior to vesting, with earlier vesting on the later of the date the executive attains age 65 or one year from the grant date for an executive attaining age 65 during the vesting period. Vesting also may be accelerated in certain circumstances, including retirement. Unvested restricted stock cannot be sold or transferred by the executive officer but entitles the executive officer to voting rights and non-forfeitable dividends equivalent to common stock. The Committee believes that this time-based vesting of restricted stock is consistent with the objectives of retaining talented executives and promoting long-term tenure of its key employees, as unvested restricted stock provides an incentive to remain with the Corporation and its subsidiaries in order to fulfill the vesting condition and realize the full award value. The long-term equity incentive compensation award under the MIP includes an annual component and a performance component. The annual component, which is a fixed value based on a percentage of the target total award value for each NEO, serves to provide each NEO with a consistent element of his annual compensation that promotes tenure with the Corporation and aligns his long-term interests with those of our shareholders. The annual component is earned through continued employment and consistent individual performance during the year and until the grant date of the award. The performance component serves to compensate executives based on the financial performance of the Corporation and its subsidiaries compared to our peers. The performance component is variable and is earned based on a corporate performance measure, which reflects consolidated performance, and, in the case of Messrs. Crone and Seaman, business unit performance measures. At the beginning of 2023, for each NEO, except for Mr. Dillon, the Committee set a target total award value as a percentage of annual base salary and established allocations of the target award value to the annual award and each performance measure as shown in the following table.

  60. 2023 Long-Term Equity Incentive Compensation Awards

    2023 Long-Term Equity Incentive Compensation Awards

  61. 2023 Long-Term Equity Incentive Compensation Awards

    | | Thomas F. Cherry | Jason E. Long | S. Dustin Crone | John A. Seaman, III | | Target Total Award Value | 45% of annual base salary | 35% of annual base salary | 25% of annual base salary | 15% of annual base salary | | Annual Award Allocation | 50% | 50% | 50% | 50% | | Corporate Performance Allocation | 50% | 50% | 25% | 25% | | Business Unit Performance Allocation | n/a(1) | n/a(1) | 25% | 25% |

  62. 2023 Long-Term Equity Incentive Compensation Awards

    | 1 | The performance component of the long-term equity incentive compensation awards for Messrs. Cherry and Long is based solely on the corporate performance measure. |

  63. 2023 Long-Term Equity Incentive Compensation Awards

    In determining the award amount for the performance component, the Committee assigns a performance score to each corporate and business unit performance measure based on the results of the performance measure during the relevant period. The total award value of the long-term equity incentive compensation award for each NEO is determined using the target total award value, the allocations to the annual award and each performance measure, and the performance scores for each performance measure, as shown below. Corporate performance was measured by reference to the Corporation’s three-year ROTCE, as defined by the Committee, which excludes the effect of accumulated other comprehensive income, relative to the 2023 Incentive Compensation Peer Group. The Committee believes that basing a portion of the equity awards under the MIP on the three-year annual return on ROTCE generally aligns the MIP with current market practices for long-term equity incentive compensation awards for executive officers, and aligns the interests of executive officers with those of the Corporation’s common shareholders by rewarding executive officers for long-term corporate performance in order to generate and sustain long-term shareholder value. ROTCE is a non-GAAP measure defined by the Committee for purposes of measuring performance as the ratio of net income to common equity excluding accumulated other comprehensive income or loss, less goodwill and intangible assets. Corporate performance for purposes of the 2023 long-term equity incentive compensation award was determined using a performance period of the three years ending September 30, 2023. For purposes of the corporate performance measure, the Committee may adjust the ROTCE of the Corporation or any financial institution in the 2023 Incentive Compensation Peer Group for nonrecurring items of income or expense or other similar items. For the 2023 performance period, the Committee considered the effects on ROTCE for the Corporation and its peers related to various nonrecurring items, which included pension settlement accounting, merger related expenses, certain gains and losses related to balance sheet restructuring, gains and losses related to certain business divestitures and the effects of resolving certain disputes or litigation, and included adjustments related to merger related expenses, changes in accounting policies that affected net income, bargain purchase gains, and the resolution of certain disputes or litigation, in order to better reflect the ongoing profitability of each institution in the peer group. The Committee established threshold, target and maximum performance levels for the corporate performance measure, expressed as a percentile relative to the 2023 Incentive Compensation Peer Group, and corresponding performance scores as a percentage of the target award value allocated to the corporate performance measure as shown in the table below. Performance outcomes between the threshold and target levels and between the target and maximum levels result in a calculated performance score determined using a straight-line interpolation. Based on the outcome of the corporate performance measure, the Committee determined the corporate performance score for the 2023 long-term equity incentive compensation award to be 150 percent for purposes of the 2023 long-term equity incentive compensation awards granted to each NEO.

  64. 2023 Long-Term Equity Incentive Compensation Awards

    | | Threshold | Target | Maximum | Actual | | Corporate Performance Measure (Percentile) | 40th | 60th | 80th | 87th 8th out of 54 | | Corporate Performance Score | 50% | 100% | 150% | 150% |

  65. 2023 Long-Term Equity Incentive Compensation Awards

    For the business unit performance measures, the Committee evaluates the performance, primarily in regards to earnings, asset quality and achievement of strategic objectives for C&F Finance and C&F Bank, and determines a business unit performance score for each business unit between zero and 150 percent. Business unit performance for purposes of the 2023 long-term equity incentive compensation award was determined using the performance period of the year ended December 31, 2023. Based on the performance of C&F Finance and C&F Bank, the Committee determined the business unit performance score for each business to be 45 percent and 135 percent, respectively, for purposes of the 2023 long-term equity incentive compensation awards granted to Messrs. Crone and Seaman. Mr. Dillon’s long-term equity incentive compensation opportunity is not covered by the MIP. Mr. Dillon’s long-term equity incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance. The Committee may determine an award amount of a number of shares with a value of up to 20 percent of Mr. Dillon’s base salary. Based on the Committee’s evaluation of these performance criteria, the Committee awarded Mr. Dillon a long-term equity incentive compensation award equal to 20 percent of his annual base salary, which based on the average closing stock price of the Corporation for the 20 business days preceding the award date, rounded to the next greater multiple of 25 shares, was equivalent to 925 shares of restricted stock. The 2023 long-term equity incentive compensation target, calculated and actual award values for each component and performance measure are shown in the table below for each of the NEOs, except for Mr. Dillon. Awards of restricted stock under the long-term equity incentive compensation award were granted to NEOs on February 20, 2024. The number of shares awarded was determined based on the average closing stock price of the Corporation for the 20 business days preceding the award date, which was $55.36 per share, rounded to the next greater multiple of 25 shares. Based on the calculated award amount and the recommendation from Mr. Cherry to the Committee that his award be less than the calculated award amount, the Committee awarded a long-term equity incentive compensation award to Mr. Cherry of $260,000 or 85 percent of the calculated award amount.

  66. 2023 Long-Term Equity Incentive Compensation Awards

    | | | Calculated Award | | | | | | | | Target Award | Annual | Corporate | Business Unit | | Actual Award | Actual | | | Value | Award | Performance | Performance | Total | Value | Award | | | ($) | ($) | ($) | ($) | ($) | ($) | Shares(1) | | Thomas F. Cherry(2) | 245,700 | 122,850 | 184,275 | n/a | 307,125 | 260,000 | 4,700 | | Jason E. Long | 99,225 | 49,613 | 74,419 | n/a | 124,032 | 124,032 | 2,250 | | Larry G. Dillon(3) | 50,000 | n/a | n/a | n/a | 50,000 | 50,000 | 925 | | S. Dustin Crone | 76,250 | 38,125 | 28,594 | 8,578 | 75,297 | 75,297 | 1,375 | | John A. Seaman, III | 37,200 | 18,600 | 13,950 | 12,555 | 45,105 | 45,105 | 825 |

  67. 2023 Long-Term Equity Incentive Compensation Awards

    | 1 | The number of shares of restricted stock awarded is determined based on the average closing stock price of the Corporation for the 20 business days preceding the award date, which was $55.36 per share, rounded to the next greater multiple of 25 shares. Because this average price is often different from the closing price on the grant date, the Actual Award Value in this table and the grant date fair value reported in the Stock Awards column of the Summary Compensation Table in the 2025 proxy statement will not necessarily be the same. |

  68. 2023 Long-Term Equity Incentive Compensation Awards

    | 2 | As discussed above, Mr. Cherry was awarded a long-term equity incentive compensation award that was less than the amount allowed under the MIP. |

  69. 2023 Long-Term Equity Incentive Compensation Awards

    | 3 | Mr. Dillon’s long-term equity incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance and has a target and maximum of 20 percent of Mr. Dillon’s base salary. |

  70. 2023 Long-Term Equity Incentive Compensation Awards

    Retirement and Deferred Compensation Plans. The Corporation’s subsidiaries sponsor several tax-qualified benefit plans, including both a defined benefit retirement plan and defined contribution plans, which are available to most employees of either the Bank, C&F Finance or C&F Mortgage, and in which our NEOs are participants. Additionally, the Corporation sponsors a nonqualified deferred compensation plan for the benefit of certain senior officers and its non-employee directors. Our tax-qualified plans are offered in order to assist our employees in attaining financial security for retirement and for employee retention. Our nonqualified plan is offered to provide flexibility to our senior officers and directors by providing deferral opportunities otherwise restricted by qualified plan limits and to establish a long-term retention incentive for our executives. Retirement Plan. The Bank offers the Virginia Bankers Association Cash Balance Pension Plan for Citizens & Farmers Bank (the “Retirement Plan”) as a tax-qualified cash balance pension plan for employees hired prior to January 1, 2022. Under the Retirement Plan, participants’ accounts are credited each year based on a percentage of each participant’s annual compensation including salary and bonus, subject to limitations under the plan and the requirements of the Internal Revenue Code (the “Code”). Participants’ accounts are also credited for interest upon each participant’s accumulated balance. The applicable compensation credit percentage ranges between 1 percent and 12 percent, increasing with a participant’s age and years of credited service at the end of each plan year. Interest credits are based on the 30-year Treasury rate plus 150 basis points, but may not be less than 3 percent or more than the IRS third segment rate. Messrs. Cherry, Long, Dillon and Seaman are participants in the Retirement Plan. Upon having completed at least three years of service or reaching age 65, participants become vested in the Retirement Plan. Upon termination from the Bank or after reaching age 62 while employed, vested participants may receive the amount then credited to the participant’s cash balance account in a lump sum or may defer benefits until age 65. Participants who defer benefits after termination continue to receive interest credits until age 65 and then may receive an actuarially equivalent joint and survivor annuity (if married) or single life annuity (if not married). The participant may also choose from other optional forms of benefit, including a lump sum payment in the amount of the cash balance account paid in one installment or in three annual installments. In 2021, Mr. Dillon received a lump sum distribution of his accrued benefits under the Retirement Plan. He will continue to accrue benefits under the Retirement Plan as an active participant in the plan from the time of his in-service distribution until his separation from service as an employee. Prior to 2009, the Bank offered the Virginia Bankers Association Master Defined Benefit Pension Plan for Citizens & Farmers Bank, which was a traditional pension plan and was converted to the current cash balance pension plan effective December 31, 2008. Participants with balances in the Retirement Plan that were converted from the traditional pension plan, including Mr. Cherry, may be entitled to benefits greater than the interest credits calculated under the Retirement Plan, pursuant to IRS rules for tax-qualified retirement plans. Benefits pursuant to such rules may fluctuate from year to year, due in part to changes in interest rates. 401(k) Plan. The Bank offers the State Bankers Association Master Defined Contribution Plan for Citizens and Farmers Bank (the “401(k) Plan”) as a tax qualified defined contribution plan for employees of C&F Bank and C&F Finance. During 2023, the State Bankers Association Master Defined Contribution Plan for C&F Finance Company, formerly offered by C&F Finance for its employees, was merged into the 401(k) Plan. The merger of the plans did not substantially modify the benefits offered to employees of C&F Bank or C&F Finance. A separate defined contribution plan is offered by C&F Mortgage for its employees. Our NEOs are participants in the 401(k) Plan. Under the 401(k) Plan, the Corporation makes matching contributions on voluntary deferrals by NEOs of up to five percent of each participant’s covered compensation, subject to limitations under the plan and the requirements of the Code. The 401(k) Plan also provides for discretionary employer contributions. Investments under the 401(k) Plan are directed by participants’ elections from among various investment options available under the plan, and participants’ accounts earn a return based on the actual return of those investment elections. Nonqualified Plan. The Corporation offers the C&F Financial Corporation Non-Qualified Deferred Compensation Plan for Directors and Executives (the “Nonqualified Plan”) for senior officers and directors of the Corporation and its subsidiaries. The plan allows executive officers to make deferrals of salary or cash incentive compensation. The Corporation makes discretionary supplemental retirement (“SERP”) contributions into executive officers’ accounts under the Nonqualified Plan. Participants’ accounts under the Nonqualified Plan earn a return based on investment elections made by participants among various investment options available under the plan. For Messrs. Cherry and Dillon, the Corporation’s discretionary SERP contributions are vested immediately in recognition of their performance and service over their careers. For Messrs. Long, Crone and Seaman, the Corporation’s discretionary SERP contributions vest generally five years from the time of each contribution, subject to earlier vesting under certain conditions, including death, disability, retirement at or after attaining age 65 or a change in control. For 2023, the Corporation made discretionary SERP contributions to the Nonqualified Plan totaling $111,065, $33,700, $25,000, $37,250 and $12,400 for Messrs. Cherry, Long, Dillon, Crone and Seaman, respectively. These contributions were made in 2024 and are reported as earned in 2023 in the Summary Compensation Table on page 43. Perquisites and Other Benefits. The Corporation provides our NEOs with benefits that we believe are reasonable and consistent with our overall compensation program as part of a competitive compensation package for attracting and retaining talented executives. Perquisites offered to NEOs, which may include personal use of Corporation-owned automobiles, matching charitable contributions, an executive physical exam every two years, club dues, financial advisory services, and tax preparation services, are common among the Corporation’s peer financial institutions. Effective January 1, 2015, the Committee approved an additional perquisite for Mr. Dillon that provides for post-retirement medical, prescription and dental benefits for Mr. Dillon and his spouse for life. Mr. Dillon is eligible to begin receiving this perquisite upon retirement from employment. Perquisites to any individual NEO that exceeded $10,000 in a particular year are included in the Summary Compensation Table on page 43. NEOs also participate in other benefit plans that are available to our employees generally. These plans include medical, dental, life, and disability insurance.

  71. 2023 Long-Term Equity Incentive Compensation Awards

    Compensation Policies and Practices as They Relate to Risk Management. The Corporation, under the guidance of the Committee, has reviewed the compensation policies and practices of the Corporation as they relate to risk management. This review included both executive officer and non-executive officer compensation policies and practices and factors in place to mitigate any excess risk. In conducting the review, management focused on the risks associated with the Corporation's compensation policies and practices and evaluated those risks in light of the Corporation's operations and the internal compensation approval and compliance systems developed by the Corporation. The Corporation has determined that its policies and practices, including mitigating factors, are not reasonably likely to have a material adverse effect on the Corporation. The Committee utilizes the position of senior compensation risk officer and meets with the Corporation’s senior compensation risk officer to discuss, evaluate and review senior executive officer (“SEO”) compensation plans and other employee compensation plans and the risks these plans pose to the Corporation. In connection with this risk review, the Committee’s goal is to identify and limit or mitigate features in SEO and other employee compensation plans that could encourage SEOs or other employees to take unnecessary and excessive risks that threaten the Corporation’s value (including behavior focused on short-term results rather than long-term shareholder value). In addition, the Committee will discuss, evaluate and review employee compensation plans and eliminate or mitigate features that could encourage the manipulation of reported earnings to enhance an employee’s compensation. These reviews are completed at least once per year. For the review conducted during October 2023, the Committee evaluated each of the plans included in this discussion with the senior compensation risk officer, as well as several additional employee compensation arrangements that provide for variable cash compensation, bonus, commission or incentive payments to employees other than SEOs. As a result of the risk and manipulation review, the Committee concluded that these plans do not encourage unnecessary and excessive risks that threaten the value of the Corporation or promote the manipulation of reported earnings to enhance the compensation of any employee and determined that the potential risks arising from these plans are not reasonably likely to have a material adverse effect on the Corporation. Role of Discretion in the Compensation Process. In fulfilling its responsibilities over the executive compensation program, the Committee must make decisions that are inherently subjective. The Committee has established compensation plans and arrangements that place limits on the Committee’s ability to exercise discretion in compensation decisions, including the MIP, which does not allow the Committee to increase the amount of any long-term equity incentive compensation award under the plan above the maximum amount calculated for any such award under the terms of the plan. The Committee retains the discretion to reduce the amount of any award determined under the terms of the MIP, including the short-term cash incentive compensation award and the long-term equity incentive compensation award. In compensation decisions for 2023, the Committee used discretion to grant less than the calculated short-term cash incentive compensation award and long-term equity incentive compensation award for Mr. Cherry, to adjust measures of ROE and ROA under the short-term cash incentive compensation award and ROTCE under the long-term equity incentive compensation award for the Corporation and its peers as described on pages 32 and 36, and to award an additional discretionary bonus to Mr. Crone as described on page 33. Clawback Policies. On October 17, 2023, the Corporation adopted the Dodd-Frank Clawback Policy (the “Dodd-Frank Clawback Policy”) to provide for the recoupment of certain incentive compensation pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, in the manner required by Section 10D of the Exchange Act, Rule 10D-1 promulgated thereunder, and Nasdaq Listing Rule 5608. On December 19, 2023, the Corporation adopted the Supplemental Clawback Policy (the “Supplemental Clawback Policy” and together with the Dodd-Frank Clawback Policy, the “Clawback Policies”) to provide for the recoupment of certain incentive compensation not covered by the Dodd-Frank Clawback Policy. The Clawback Policies replace the Corporation’s Executive Incentive Compensation Clawback Policy adopted by the Board on December 20, 2022. Taken together, the Clawback Policies provide for the clawback of certain excess incentive compensation paid to executive officers in the event of an accounting restatement to correct material non-compliance with any financial reporting requirements under applicable securities laws, when the amount of incentive compensation granted, earned or vested was based or determined in whole or in part upon the Corporation’s financial statements that were subsequently restated. Excess incentive compensation is the amount that would not have been paid to the executive officers if the incentive compensation had been determined based on the restated financial statements. However, if the Committee determines that the accounting restatement resulted from intentional misconduct by executive officers, then the Corporation may recover up to 100 percent of any incentive compensation received by those executive officers during the three completed fiscal years of the Corporation immediately preceding the earlier of (i) the date the Board, a committee of the Board, or the officer(s) of the Corporation authorized to take such action if Board action is not required, concludes, or reasonably should have concluded, that the Corporation is required to prepare an accounting restatement, or (ii) the date a court, regulator or other legally authorized body directs the Corporation to prepare an accounting restatement. Recovery of amounts under the Clawback Policies from an executive officer may include (i) recoupment of cash or shares of Corporation stock, (ii) forfeiture of unvested cash or equity awards (including those subject to service-based and/or performance-based vesting conditions), (iii) cancellation of outstanding vested cash or equity awards (including those for which service-based and/or performance-based vesting conditions have been satisfied), (iv) to the extent consistent with Section 409A of the Code, offset of other amounts owed to the executive officer or forfeiture of deferred compensation, (v) reduction of future compensation, or (vi) any other remedial or recovery action permitted by law. Under the Dodd-Frank Clawback Policy, the Committee may, under certain limited circumstances, determine that recoupment is not required. Under the Supplemental Clawback Policy, the Committee may determine that recoupment (or recoupment in full) is not warranted in the event the Committee determines that to do so would be unreasonable or it would be in the long-term interests of the Corporation not to require repayment. There have been no restatements that would require recovery of erroneously awarded compensation under the Clawback Policies.

  72. 2023 Long-Term Equity Incentive Compensation Awards

    Prohibition on Hedging and Pledging Transactions. Under the Corporation’s insider trading policy, directors, executive officers and other insiders, including the named executive officers, are prohibited from (i) pledging the Corporation’s stock as collateral for loans and (ii) selling the Corporation’s stock “short,” trading in the Corporation’s stock in or through a margin account or otherwise engaging in hedging transactions or speculative or short-term trading of the Corporation’s stock. These provisions are part of the Corporation’s overall program to prevent the Corporation’s directors, executive officers and other insiders, including the NEOs, from trading on material non-public information. Tax and Accounting Implications. As part of its role, the Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Code, which provides that the Corporation may not deduct compensation of more than $1,000,000 annually that is paid to certain individuals. In 2023, the Corporation paid compensation that was not deductible to the Corporation to Mr. Cherry of $182,000. The Committee believes it is in the Corporation’s and its shareholders’ best interests to retain flexibility to pay appropriate compensation levels and therefore may choose to pay compensation that will not be deductible under Section 162(m) of the Code in order to ensure competitive levels of total compensation for the Corporation’s executive officers.

  73. Employment and Change in Control Agreements

    Employment and Change in Control Agreements The Corporation may be required to make payments of severance or other benefits upon termination of an executive officer or a change in control of the Corporation pursuant to certain agreements and other arrangements as detailed below. Cherry Employment Agreement. Mr. Cherry is employed under an employment agreement entered into in 2021 by the Corporation, the Bank and Mr. Cherry (the “Cherry Employment Agreement”). The Cherry Employment Agreement had an initial term of one year and renews for successive one-year periods unless either party provides written notice of non-renewal during the then-current term. The Cherry Employment Agreement provides for payment of base salary and the executive’s eligibility to receive such equity awards and cash incentive compensation as determined by the Board or its designee. Incentive-based compensation paid to the executive is subject to clawback as may be required under the Corporation’s clawback policy or under provisions of applicable law, SEC rule or regulation or stock exchange requirement. In addition, the Cherry Employment Agreement entitles the executive to participation in employee benefit plans as determined by the Board or its designee. Under the Cherry Employment Agreement, in the event of termination of employment due to death or incapacity (as defined in the agreement), the executive is entitled to (a) unpaid base salary through the date of termination and (b) any other benefits vested and payable under any plans, policies or programs (collectively, the “Accrued Obligations”). Under the Cherry Employment Agreement, in the event of termination of employment without cause (as defined in the agreement) while the Cherry Employment Agreement is in place or during the one-year period following the termination of the Cherry Employment Agreement due to non-renewal by the Corporation (generally referred to as a termination without cause) or by the executive for good reason (as defined in the agreement), then, provided the executive timely executes a general release of claims, the executive is entitled to the Accrued Obligations and a lump-sum cash payment equal to the executive’s annual base salary in effect immediately preceding the termination of employment and, provided certain conditions are met, a monthly payment equal to the employer-paid portion of COBRA continuation coverage, payable for 12 months. In the event of termination of employment without cause or by the executive for good reason, post-termination payments will cease if the executive fails to comply with the covenants set forth in the Cherry Employment Agreement. Under the Cherry Employment Agreement, in the event of termination of employment for cause or by the executive without good reason, the executive is entitled to the Accrued Obligations. The Cherry Employment Agreement requires the executive to comply with confidentiality and non-disparagement covenants as well as 12-month non-piracy and non-solicitation covenants. The Cherry Employment Agreement will terminate if a change in control of the Corporation or the Bank occurs during the executive’s employment and any severance benefits payable upon a termination of employment on or following such change in control shall be determined and paid solely pursuant to Mr. Cherry’s change in control agreement, as described below. In the event of termination of the Cherry Employment Agreement, the executive remains obligated to comply with the confidentiality, non-disparagement, non-piracy and non-solicitation covenants as set forth in the agreement. Long and Crone Employment Agreements. Mr. Long is employed under an employment agreement entered into in 2021 by the Corporation, the Bank and Mr. Long (the “Long Employment Agreement”). Mr. Crone is employed under an employment agreement entered into in 2021 by the Corporation, C&F Finance and Mr. Crone (the “Crone Employment Agreement”). The Long Employment Agreement and the Crone Employment Agreement have substantially identical provisions as the Cherry Employment Agreement. Change in Control Agreements. The Corporation has entered into “change in control agreements” with each of the NEOs (the “CIC Agreements”) because the Board has determined that it is in the best interest of the Corporation and its shareholders to have the continued dedication of these executives, notwithstanding the possibility, threat or occurrence of a change in control. The CIC Agreements provide for payments of severance in cash as well as group health and other benefits following termination. In addition to the CIC Agreements, other benefits may be provided following a change in control of the Corporation under the 2022 Stock and Incentive Compensation Plan or the 2013 Stock and Incentive Compensation Plan, including accelerated vesting of restricted stock awards. The CIC Agreement with Mr. Cherry (the “Cherry CIC Agreement”) provides for certain payments and benefits in the event of a termination of employment by the Corporation without cause (as defined in the agreement) or by Mr. Cherry for good reason (as defined in the agreement) during the two-year period following a change in control (as defined in the agreement). In such event, Mr. Cherry (i) would be entitled to receive a lump sum cash payment equal to the sum of 2.99 times his highest annual base salary during the 24-month period preceding the change in control and 2.99 times his highest annual bonus for the three fiscal years preceding the change in control and (ii) would generally be entitled to receive continuing benefits under group health plans providing medical, prescription, dental and vision benefits (the “Group Health Plans”) for a period of three years following termination. Additionally, the Cherry CIC Agreement provides for a special termination payment equal to the sum of two times his highest annual base salary during the 24-month period preceding his termination and three times his highest annual bonus for the three fiscal years preceding his termination in the limited circumstance in which Mr. Cherry’s employment is involuntarily terminated without cause prior to a change in control, if the termination is at the request of a third party who is a party to the change in control or otherwise arose in connection with or in anticipation of the change in control and if Mr. Cherry has complied with the non-disclosure and non-competition covenants under the Cherry CIC Agreement and with the non-piracy, non-solicitation and non-disparagement covenants under the Cherry Employment Agreement. This special termination payment would be in addition to any payments or benefits under the terms of the Cherry Employment Agreement. The Cherry CIC Agreement includes non-disclosure and non-competition covenants and incorporates the non-piracy, non-solicitation and non-disparagement covenants from the Cherry Employment Agreement.

  74. Employment and Change in Control Agreements

    The CIC Agreements with Messrs. Long and Crone (the “Long CIC Agreement” and the “Crone CIC Agreement”, respectively) each provide for certain payments and benefits in the event of a termination of employment by the Corporation without cause (as defined in the agreement) or by either Mr. Long or Mr. Crone for good reason (as defined in the agreement) during the two-year period following a change in control (as defined in the agreement). In such event, Mr. Long or Mr. Crone (i) would each be entitled to receive a lump sum cash payment in an amount equal to two times the sum of his highest annual base salary during the 24-month period preceding the change in control and his highest annual bonus for the three fiscal years preceding the change in control, and (ii) would each generally be entitled to receive continuing benefits under the Group Health Plans for a period of two years following termination. Additionally, the Long CIC Agreement and Crone CIC Agreement each provide for a special termination payment in an amount equal to the sum of one times Mr. Long’s or Mr. Crone’s highest annual base salary during the 24-month period preceding his termination and two times his highest annual bonus for the three fiscal years preceding his termination in the limited circumstance in which Mr. Long’s or Mr. Crone’s employment is involuntarily terminated without cause prior to a change in control, if the termination is at the request of a third party who is a party to the change in control or otherwise arose in connection with or in anticipation of the change in control and if Mr. Long or Mr. Crone has complied with the non-disclosure and non-competition covenants under the Long CIC Agreement or the Crone CIC Agreement, respectively, and with the non-piracy, non-solicitation and non-disparagement covenants under the Long Employment Agreement or the Crone Employment Agreement, respectively. This special termination payment would be in addition to any payments or benefits under the terms of the Long Employment Agreement or the Crone Employment Agreement. The Long CIC Agreement and Crone CIC Agreement each includes non-disclosure and non-competition covenants and incorporates the non-piracy, non-solicitation and non-disparagement covenants from the Long Employment Agreement and Crone Employment Agreement, respectively. The CIC Agreements with Messrs. Dillon and Seaman provide for certain payments and benefits in the event of a termination of employment by the Corporation without cause (as defined in the agreement), or by Mr. Dillon or Mr. Seaman for good reason (as defined in the agreement), during the two-year period following a change in control (as defined in the agreement), or prior to a change in control in the event of a termination of employment in anticipation of a change in control. In such event, Mr. Dillon would be entitled (i) to receive a lump sum cash payment in an amount equal to two and one-half times the sum of his highest annual base salary during the 24-month period preceding the change in control and his highest annual bonus for the three fiscal years preceding the change in control; and (ii) generally to receive continuing vision benefits for a period of three years following termination of employment; and Mr. Seaman would be entitled (i) to receive a lump sum cash payment in an amount equal to two times the sum of his highest annual base salary during the 24-month period preceding the change in control and his highest annual bonus for the three fiscal years preceding the change in control; and (ii) generally to receive continuing benefits under the Group Health Plans for a period of two years following termination of employment. Mr. Dillon also has a right to continued medical, prescription and dental coverage for himself and his spouse under a separate agreement with the Corporation. The CIC Agreements with Messrs. Dillon and Seaman include non-disclosure and non-competition covenants. The CIC Agreements provide for benefits to be paid on a “best net after-tax” basis, such that the executive’s change in control benefits will be reduced to avoid excise taxes related to excess parachute payments under Section 280G of the Code only if such a reduction would result in greater after-tax compensation than without a reduction. The Corporation has no agreements with executives or other officers that include Section 280G tax gross-up provisions. In certain cases, some or all of the payments and benefits provided on termination of employment under the employment agreements and the CIC Agreements may be delayed for six months following termination to comply with the requirements of Section 409A of the Code. Any payment required to be delayed would be paid at the end of the six-month period in a lump sum, with any payments due after the six-month period being paid at the normal payment date provided for under the agreement. In the case of benefits that are delayed, the executive would pay the cost of benefit coverage during the six-month delay period and then be reimbursed by the Corporation at the end of the six-month period. Retirement, Early Retirement, Death, Disability. For terminations due to death or disability, vesting of any unvested restricted stock and retirement benefits occur at the date of termination. For terminations due to retirement, restricted stock awards granted prior to December 31, 2021 provide for accelerated vesting at the date of termination. For terminations due to early retirement, restricted stock awards provide for accelerated vesting upon the one-year anniversary of the date of termination and only if the individual has complied with a non-competition agreement. Further, restricted stock awards granted to key employees also provide for accelerated vesting in the event of termination by the Corporation for reasons other than cause. In addition to the agreements discussed above and other elements of the Corporation’s executive compensation program detailed in the Compensation Discussion and Analysis within this Proxy Statement, Mr. Dillon is eligible, upon his retirement, to payment of post-retirement medical, prescription and dental benefits for himself and his spouse for life.

  75. Summary Compensation Table

    Summary Compensation Table

  76. Summary Compensation Table

    | | | | | | | Change in | | | | | | | | | | Pension | | | | | | | | | Non- | Value and | | | | | | | | | Equity | Nonqualified | | | | | | | | | Incentive | Deferred | All | | | | | | | Stock | Plan | Compensation | Other | | | | | Salary | Bonus(2) | Awards(3) | Compensation(4) | Earnings(5) | Compensation(6) | Total | | Name and Principal Position(1) | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | | Thomas F. Cherry | 2023 | 546,000 | — | 249,275 | 250,000 | 70,381 | 177,255 | 1,292,911 | | President/ | 2022 | 520,000 | — | 202,240 | 213,652 | 52,773 | 171,393 | 1,160,058 | | Chief Executive Officer | 2021 | 440,000 | — | 217,408 | 295,000 | 48,498 | 156,227 | 1,157,133 | | Jason E. Long | 2023 | 283,500 | — | 110,625 | 128,244 | 20,900 | 72,430 | 615,699 | | Executive Vice President/Chief Financial Officer/ | 2022 | 270,000 | 13,717 | 78,368 | 86,283 | 17,487 | 71,269 | 537,124 | | Secretary | 2021 | 255,000 | — | 92,863 | 100,000 | 16,098 | 67,730 | 531,691 | | Larry G. Dillon | 2023 | 250,000 | — | 50,150 | 50,000 | 41,117 | 58,636 | 449,903 | | Executive Chairman | 2022 | 250,000 | — | 49,296 | 50,000 | 36,462 | 64,946 | 450,704 | | | 2021 | 250,000 | — | 54,625 | 50,000 | 320,628 | 83,469 | 758,722 | | S. Dustin Crone | 2023 | 305,000 | 31,585 | 75,225 | 117,415 | — | 81,895 | 611,120 | | President/Chief Executive | 2022 | 290,000 | — | 72,048 | 160,000 | — | 73,281 | 595,329 | | Officer of C&F Finance Company | 2021 | 271,000 | — | 80,845 | 160,000 | — | 71,303 | 583,148 | | John A. Seaman, III | 2023 | 248,000 | — | 38,350 | 86,000 | 47,246 | 45,373 | 464,969 | | Executive Vice President/Chief Credit | | | | | | | | | | Officer of C&F Bank | | | | | | | | |

  77. Summary Compensation Table

    | 1 | Reflects titles as of December 31, 2023. |

  78. Summary Compensation Table

    | 2 | The amounts shown in this column reflect the additional discretionary cash bonuses awarded to Mr. Long for 2022 and to Mr. Crone for 2023 based on achievement of key strategic priorities, which is discussed further on page 33. |

  79. Summary Compensation Table

    | 3 | The amounts in this column reflect the grant date fair value for restricted stock granted during fiscal years ended December 31, 2023, 2022 and 2021, respectively, pursuant to the 2022 Stock and Incentive Compensation Plan and the 2013 Stock and Incentive Compensation Plan, calculated in accordance with ASC Topic 718, based on the closing price of the Corporation’s stock on the date of grant. These amounts do not include the 2023 long-term equity incentive compensation awards discussed in further detail on pages 33 to 36, which were granted in February 2024. |

  80. Summary Compensation Table

    | 4 | The amounts in this column reflect the short-term cash incentive compensation awards for 2023, 2022 and 2021, which are discussed in further detail on pages 30 to 33. |

  81. Summary Compensation Table

    | 5 | The amounts in this column reflect the actuarial increase in the present value of the named executive officers’ accumulated benefits under the Retirement Plan established by the Bank determined using assumptions consistent with those used in the Corporation’s audited financial statements. The amount shown for Mr. Dillon for 2021 includes changes in the actuarial value of benefits earned prior to 2009, when the Bank offered a traditional pension plan, as discussed in further detail on page 37. Mr. Crone is not a participant in the Retirement Plan. All earnings under the Nonqualified Plan are actual dividends and earnings of investments based on participants’ investment elections and are not required to be reported in this column. |

  82. Summary Compensation Table

    | 6 | The amounts in this column for 2023 include dividends paid on unvested stock awards for each NEO (including $20,715 for Mr. Cherry); contributions to defined contribution plans for each NEO (including $127,565 for Mr. Cherry, $50,200 for Mr. Long, $40,000 for Mr. Dillon, $53,750 for Mr. Crone and $28,800 for Mr. Seaman); personal use of Corporation-owned automobiles for each NEO; matching charitable contributions for Messrs. Cherry, Long, Dillon and Crone; club dues for Messrs. Cherry and Dillon; an executive physical exam for Messrs. Cherry and Crone; and financial planning services for Mr. Cherry. Amounts contributed to defined contribution plans for each NEO includes employer matching contributions to tax-qualified plans and also includes discretionary employer SERP contributions to the Nonqualified Plan made by the Corporation for 2023 of $111,065 for Mr. Cherry, $33,700 for Mr. Long, $25,000 for Mr. Dillon, $37,250 for Mr. Crone and $12,400 for Mr. Seaman. These SERP contributions were not paid to the plan as of the end of the fiscal year, but were made by the Corporation in January 2024 into each respective NEO’s account in the plan. The Corporation’s defined contribution plans are discussed in further detail on pages 36 to 37. |

  83. Summary Compensation Table

    The following table summarizes certain information with respect to cash and equity incentive opportunities established in 2023.

  84. Grants of Plan-Based Awards for 2023

    Grants of Plan-Based Awards for 2023

  85. Grants of Plan-Based Awards for 2023

    | | | | | | | | | Other Stock | | | | | | | | | | | Awards: | | | | | | | | | | | Number | Grant Date | | | | | | | | | | of Shares | Fair Value | | | | Estimated Possible Payouts Under | | | Estimated Possible Payouts Under | | | of Stock | of Stock | | | | Non-Equity Incentive Plan Awards(2) | | | Equity Incentive Plan Awards(3) | | | or Units(4) | Awards(1) | | | Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | | | | Name | Date(1) | ($) | ($) | ($) | ($) | ($) | ($) | (#) | ($) | | Thomas F. Cherry | | | | | | | | | | | Cash award | | 122,850 | 245,700 | 491,400 | | | | | | | Equity award - Performance | n/a | | | | 61,425 | 122,850 | 184,275 | | 131,319 | | Equity award - Annual | n/a | | | | | | | 2,219 | 117,452 | | Jason E. Long | | | | | | | | | | | Cash award | | 49,613 | 99,225 | 198,450 | | | | | | | Equity award - Performance | n/a | | | | 24,806 | 49,613 | 74,419 | | 71,667 | | Equity award - Annual | n/a | | | | | | | 896 | 47,425 | | Larry G. Dillon | | | | | | | | | | | Cash award | | — | 50,000 | 50,000 | | | | | | | Equity award | n/a | | | | — | 50,000 | 50,000 | — | 48,960 | | S. Dustin Crone | | | | | | | | | | | Cash award | | | 117,415 | | | | | | | | Equity award - Performance | n/a | | | | 9,531 | 38,125 | 57,188 | | 36,310 | | Equity award - Annual | n/a | | | | | | | 689 | 36,469 | | John A. Seaman, III | | | | | | | | | | | Cash award | | — | 62,000 | 124,000 | | | | | | | Equity award - Performance | n/a | | | | 4,650 | 18,600 | 27,900 | | 25,883 | | Equity award - Annual | n/a | | | | | | | 336 | 17,784 |

  86. Grants of Plan-Based Awards for 2023

    | 1 | The 2023 long-term equity incentive compensation awards do not have a grant date during the year ended December 31, 2023 and were ultimately granted in the form of restricted stock on February 20, 2024. The awards granted under the MIP are comprised of a performance component and an annual component, and the award granted to Mr. Dillon is comprised of only a performance component. The fair value of these awards at the grant date was determined in accordance with ASC Topic 718, based on the closing price of the Corporation’s stock on that date and has been allocated, except for Mr. Dillon, to the two components in this table. The awards were granted in the form of restricted stock, subject to graded vesting over a period of three years or accelerated vesting under certain circumstances, and include rights to non-forfeitable dividends on unvested shares equal to dividends declared to common shareholders. See pages 33 to 36 for further details on the 2023 long-term equity incentive compensation awards. Because the fair value of these awards at the grant date was determined based on the closing price of the Corporation’s stock on that date, the values in this column are different from the Actual Award Values reflected in the table on page 36 which reflect the award values determined by the Compensation Committee, with the number of shares awarded determined based on the average closing stock price of the Corporation for the 20 business days preceding the grant date, rounded to next greater multiple of 25 shares. |

  87. Grants of Plan-Based Awards for 2023

    | 2 | These columns reflect the threshold, target and maximum amounts established under the 2023 short-term cash incentive compensation award for Messrs. Cherry and Long, and the target and maximum amounts established under the 2023 short-term cash incentive compensation award for Mr. Seaman. The actual amounts awarded under the 2023 short-term cash incentive compensation award for Messrs. Cherry, Long and Seaman were $250,000, $128,244 and $86,000, respectively. Mr. Dillon’s short-term cash incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance and has a target and maximum of 20 percent of Mr. Dillon’s base salary. Threshold, target and maximum amounts are not established under the 2023 short-term cash incentive compensation award for Mr. Crone, whose award is determined based on the ROA and net income of C&F Finance and achievement of strategic objectives. The amounts reported in these columns for Mr. Crone reflect the actual amount of his 2023 short-term cash incentive compensation awards. |

  88. Grants of Plan-Based Awards for 2023

    | 3 | These columns reflect the threshold, target and maximum equity values established for the performance component of the 2023 long-term equity incentive compensation award. These amounts do not include $122,850, $49,613, $38,125 and $18,600 of the annual component of the 2023 long-term equity incentive compensation awards for Messrs. Cherry, Long, Crone and Seaman, respectively, which are fixed values based on a percentage of the target total award value for each NEO and earned through consistent individual performance during 2023. Mr. Dillon’s long-term equity incentive compensation award is based on the Committee’s evaluation of his individual involvement and performance in matters of corporate strategy and governance and has a target and maximum of 20 percent of Mr. Dillon’s base salary. |

  89. Grants of Plan-Based Awards for 2023

    | 4 | The amounts in this column reflect the approximate number of shares granted for the annual component of the 2023 long-term equity incentive compensation award that were granted on February 20, 2024 based on the average closing price of the Corporation’s stock for the preceding 20 business days. The annual component is earned through consistent individual performance during 2023 and is not reported under the columns for equity incentive plan awards in this table because its value is fixed as a percentage of target total award value. |

  90. Grants of Plan-Based Awards for 2023

    The following table includes certain information with respect to all previously-awarded unvested restricted stock awards held by the named executive officers at December 31, 2023. None of the NEOs held any unexercised stock options at December 31, 2023.

  91. Outstanding Equity Awards at 2023 Fiscal Year-End

    Outstanding Equity Awards at 2023 Fiscal Year-End

  92. Outstanding Equity Awards at 2023 Fiscal Year-End

    | | Stock Awards | | | | | | | Market | | | | Number of | Value of | | | | Shares or | Shares or | | | | Units of | Units of | | | | Stock That | Stock That | | | | Have Not | Have Not | | | Vesting | Vested(1) | Vested(2) | | Name | Date | (#) | ($) | | Thomas F. Cherry | 2/1/2024 | 4,975 | 339,245 | | | 3/1/2024 | 2,741 | 186,909 | | | 3/1/2025 | 2,742 | 186,977 | | | 3/1/2026 | 1,409 | 96,080 | | Total: | | 11,867 | 809,211 | | Jason E. Long | 2/1/2024 | 2,125 | 144,903 | | | 3/1/2024 | 1,142 | 77,873 | | | 3/1/2025 | 1,141 | 77,805 | | | 3/1/2026 | 625 | 42,619 | | Total: | | 5,033 | 343,200 | | Larry G. Dillon | 2/1/2024 | 1,250 | 85,237 | | | 2/15/2024 | 850 | 57,962 | | Total: | | 2,100 | 143,199 | | S. Dustin Crone | 2/1/2024 | 1,850 | 126,151 | | | 3/1/2024 | 900 | 61,371 | | | 3/1/2025 | 900 | 61,371 | | | 3/1/2026 | 425 | 28,981 | | Total: | | 4,075 | 277,874 | | John A. Seaman, III | 2/1/2024 | 1,225 | 83,532 | | | 2/15/2024 | 650 | 44,324 | | Total: | | 1,875 | 127,856 |

  93. Outstanding Equity Awards at 2023 Fiscal Year-End

    | 1 | The amounts in this column reflect the number of shares of restricted stock granted from 2021 through 2023 to each NEO pursuant to the 2013 Stock and Incentive Compensation Plan and the 2022 Stock and Incentive Compensation Plan. Awards granted on February 16, 2021 were modified in December 2021, and the vesting date of each such award was changed to February 1, 2024, subject to accelerated vesting under certain circumstances. Awards granted in 2022 and 2023 are subject to graded vesting over a period of three years or accelerated vesting under certain circumstances, including earlier vesting at the later of the date that a participant attains age 65 or one year from the date of grant. Participants are entitled to non-forfeitable dividends on unvested shares equal to dividends declared to common shareholders. This table does not include awards under the 2023 long-term equity incentive compensation award, which were granted on February 20, 2024. |

  94. Outstanding Equity Awards at 2023 Fiscal Year-End

    | 2 | The amounts in this column represent the fair market value of the restricted stock as of December 31, 2023, based on the closing price of the Corporation’s stock of $68.19 on December 29, 2023, which was the last business day of the year. |

  95. Outstanding Equity Awards at 2023 Fiscal Year-End

    The following table provides information regarding the value realized by our NEOs who held restricted stock that vested during 2023. The information presented in the following table includes stock awards that were granted in 2020 and 2022 for each NEO. None of the NEOs exercised any stock options during 2023.

  96. Stock Vested for 2023

    Stock Vested for 2023

  97. Stock Vested for 2023

    | | Stock Awards | | | | Number of Shares | Value Realized | | | Acquired on Vesting | on Vesting(1) | | Name | (#) | ($) | | Thomas F. Cherry | 4,383 | 262,033 | | Jason E. Long | 1,817 | 108,689 | | Larry G. Dillon | 1,965 | 117,232 | | S. Dustin Crone | 1,875 | 112,260 | | John A. Seaman, III | 1,460 | 87,070 |

  98. Stock Vested for 2023

    | 1 | The value realized on vesting is the fair market value based on the closing price of the Corporation’s stock on the date of vesting multiplied by the number of shares that vested. For purposes of this table, if the date of vesting was a non-business day, the closing price of the Corporation’s stock on the business day prior to the date of vesting was used. |

  99. Stock Vested for 2023

    The following table shows the actuarial present value of accumulated benefits payable to each of the named executive officers, including the number of years of service credited to each named executive officer and payments made to each named executive officer under the Retirement Plan, which is described in more detail beginning on page 36.

  100. Pension Benefits as of December 31, 2023

    Pension Benefits as of December 31, 2023

  101. Pension Benefits as of December 31, 2023

    | | | Number of Years | Present Value of | Payments During Last | | | | Credited Service | Accumulated Benefit(1) | Fiscal Year | | Name | Plan Name | (#) | ($) | ($) | | Thomas F. Cherry | Retirement Plan | 27 | 777,854 | — | | Jason E. Long | Retirement Plan | 9 | 104,166 | — | | Larry G. Dillon(2) | Retirement Plan | 2 | 78,447 | — | | S. Dustin Crone(3) | n/a | — | — | — | | John A. Seaman, III | Retirement Plan | 12 | 316,862 | — |

  102. Pension Benefits as of December 31, 2023

    | 1 | Assumptions used in the calculation of these amounts are included in Note 14 to the Corporation’s audited financial statements for the fiscal year ended December 31, 2023 included in the Corporation’s Annual Report on Form 10-K filed with the SEC on February 27, 2024. This account balance for each participant will grow each year with annual pay credits based on age and years of service and monthly interest credits based for 2023 on the December 2022 average yield for 30-year Treasuries plus 150 basis points, but no less than 3 percent and not to exceed the IRS third segment rate. |

  103. Pension Benefits as of December 31, 2023

    | 2 | During 2021, Mr. Dillon received an in-service distribution of his benefits under the Retirement Plan as a lump sum, as a result of which his years of credited service were reduced to zero. Mr. Dillon has 45 years of actual service with the Corporation. He will continue to accrue benefits as an active participant in the plan from the date of his in-service distribution until his separation from service as an employee. |

  104. Pension Benefits as of December 31, 2023

    | 3 | Mr. Crone is not a participant in the Retirement Plan. |

  105. Pension Benefits as of December 31, 2023

    The following table summarizes our named executive officers’ compensation under our Nonqualified Plan, which is described in more detail beginning on page 37.

  106. Nonqualified Deferred Compensation for 2023

    Nonqualified Deferred Compensation for 2023

  107. Nonqualified Deferred Compensation for 2023

    | | Executive | Registrant | Aggregate | Aggregate | Aggregate | | | Contributions in | Contributions in | Earnings | Withdrawals/ | Balance | | | Last FY(1) | Last FY(2) | in Last FY(3) | Distributions | at Last FYE(4)(5) | | Name | ($) | ($) | ($) | ($) | ($) | | Thomas F. Cherry | — | 111,065 | 227,836 | — | 1,631,466 | | Jason E. Long | — | 33,700 | 21,681 | — | 199,249 | | Larry G. Dillon | — | 25,000 | 158,669 | — | 1,466,117 | | S. Dustin Crone | — | 37,250 | 66,102 | — | 570,746 | | John A. Seaman, III | — | 12,400 | 8,048 | — | 75,499 |

  108. Nonqualified Deferred Compensation for 2023

    | 1 | Pursuant to the Nonqualified Plan, certain executives, including named executive officers, may defer any portion of their base salary or awards earned under the MIP. No NEOs elected to defer any portion of their compensation in 2023. |

  109. Nonqualified Deferred Compensation for 2023

    | 2 | Amounts in this column represent discretionary employer SERP contributions for 2023 for each NEO, which were not paid to the plan as of the end of the fiscal year. These amounts are reported as 2023 compensation in the Summary Compensation Table on page 43 and were paid by the Corporation in January 2024 into each respective NEO’s account in the Nonqualified Plan. |

  110. Nonqualified Deferred Compensation for 2023

    | 3 | Earnings (losses) attributed to participants under the Nonqualified Plan are actual returns based on their investment elections under the plan. |

  111. Nonqualified Deferred Compensation for 2023

    | 4 | The aggregate balance includes $109,948, $147,906 and $61,382 for Messrs. Long, Crone and Seaman, respectively, which amounts were not vested as of December 31, 2023. These amounts would vest upon the earlier of death, disability, retirement, a change in control or five years from the year for which each applicable contribution was made. |

  112. Nonqualified Deferred Compensation for 2023

    | 5 | Of the amounts disclosed in this column, $907,579, $115,525, $1,353,828, and $244,775 were previously reported as compensation to Messrs. Cherry, Long, Dillon and Crone, respectively, in Summary Compensation Tables for years prior to 2023. |

  113. Nonqualified Deferred Compensation for 2023

    The following table shows the potential payments upon termination, including following a change in control of the Corporation, for the NEOs based on agreements and plans in effect as of December 31, 2023. The amounts in this table are calculated assuming the change in control or termination event occurred on December 31, 2023 and all executives were paid in a lump sum payment. The fair market value of the Corporation’s stock as of December 31, 2023 is based on the closing price of $68.19 per share on December 29, 2023, which was the last business day of the year. The amounts in this table are estimates, as the actual amounts to be paid to or received by an NEO can only be determined at the time of termination or change in control. Additionally, this table reports only amounts that are increased, accelerated or otherwise paid or payable as a result of the applicable termination or change in control event and, as a result, excludes amounts accrued through December 31, 2023, such as accrued but unpaid salary and incentive compensation amounts for completed performance periods, already vested restricted stock awards and vested account balances under the Retirement Plan and Nonqualified Plan. In particular, certain vested amounts included in the tables above related to pension benefits or nonqualified deferred compensation may become payable upon a change in control and are excluded from the table below. This table also excludes any amounts that are available generally to all salaried employees in a manner that does not discriminate in favor of our NEOs.

  114. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control

  115. Potential Payments Upon Termination or Change in Control

    | | | Unvested and | | | | | | | | Accelerated | | Supplemental | | | | | | Restricted | Welfare | Retirement | 280G Tax | | | | Severance | Stock | Benefits | Benefits | Gross-ups(8) | Total | | Name and Principal Position | ($) | ($) | ($) | ($) | ($) | ($) | | Thomas F. Cherry President/Chief Executive Officer | | | | | | | | Voluntary (1) | - | - | - | - | - | - | | By Corporation without cause (2) | 546,000 | 809,211 | 17,444 | - | - | 1,372,655 | | By Corporation with cause (1) | - | - | - | - | - | - | | By Executive with good reason (3) | 546,000 | - | 17,444 | - | - | 563,444 | | After change in control (4) | 2,514,590 | 809,211 | 68,046 | - | - | 3,391,847 | | In anticipation of change in control (5) | 2,523,000 | 809,211 | 17,444 | - | - | 3,349,655 | | Retirement (6) | - | - | - | - | - | - | | Disability (7) | - | 809,211 | - | - | - | 809,211 | | Death (7) | - | 809,211 | - | - | - | 809,211 | | Jason E. Long Executive Vice President/Chief Financial Officer/Secretary | | | | | | | | Voluntary (1) | - | - | - | - | - | - | | By Corporation without cause (2) | 283,500 | 343,200 | 17,247 | - | - | 643,947 | | By Corporation with cause (1) | - | - | - | - | - | - | | By Executive with good reason (3) | 283,500 | - | 17,247 | - | - | 300,747 | | After change in control (4) | 767,000 | 343,200 | 45,881 | 109,948 | - | 1,266,029 | | In anticipation of change in control (5) | 767,000 | 343,200 | 17,247 | - | - | 1,127,447 | | Retirement (6) | - | - | - | - | - | - | | Disability (7) | - | 343,200 | - | 109,948 | - | 453,148 | | Death (7) | - | 343,200 | - | 109,948 | - | 453,148 | | Larry G. Dillon Executive Chairman | | | | | | | | Voluntary (1) | - | - | - | - | - | - | | By Corporation without cause (2) | - | 143,199 | - | - | - | 143,199 | | By Corporation with cause (1) | - | - | - | - | - | - | | By Executive with good reason | - | - | - | - | - | - | | After change in control (4) | 750,000 | 143,199 | 326,929 | - | - | 1,220,128 | | In anticipation of change in control (5) | 750,000 | 143,199 | 326,929 | - | - | 1,220,128 | | Retirement (6) | - | 85,238 | 326,600 | - | - | 411,838 | | Disability (7) | - | 143,199 | 326,600 | - | - | 469,799 | | Death (7) | - | 143,199 | 220,734 | - | - | 363,933 | | S. Dustin Crone President/Chief Executive Officer of C&F Finance | | | | | | | | Voluntary (1) | - | - | - | - | - | - | | By Corporation without cause (2) | 305,000 | 277,874 | 8,263 | - | - | 591,137 | | By Corporation with cause (1) | - | - | - | - | - | - | | By Executive with good reason (3) | 305,000 | - | 8,263 | - | - | 313,263 | | After change in control (4) | 930,000 | 277,874 | 15,965 | 147,906 | - | 1,371,745 | | In anticipation of change in control (5) | 930,000 | 277,874 | 8,263 | - | - | 1,216,137 | | Retirement (6) | - | - | - | - | - | - | | Disability (7) | - | 277,874 | - | 147,906 | - | 425,780 | | Death (7) | - | 277,874 | - | 147,906 | - | 425,780 | | John A. Seaman III Executive Vice President/ Chief Credit Officer of C&F Bank | | | | | | | | Voluntary (1) | - | - | - | - | - | - | | By Corporation without cause (2) | - | 127,856 | - | - | - | 127,856 | | By Corporation with cause (1) | - | - | - | - | - | - | | By Executive with good reason | - | - | - | - | - | - | | After change in control (4) | 656,000 | 127,856 | 35,476 | 61,382 | - | 880,714 | | In anticipation of change in control (5) | 656,000 | 127,856 | 35,476 | - | - | 819,332 | | Retirement (6) | - | 83,533 | - | 61,382 | - | 144,915 | | Disability (7) | - | 127,856 | - | 61,382 | - | 189,238 | | Death (7) | - | 127,856 | - | 61,382 | - | 189,238 |

  116. Potential Payments Upon Termination or Change in Control

    | 1 | There are no payments due in the event of voluntary termination by an NEO or if the Corporation terminates an NEO’s employment with cause. |

  117. Potential Payments Upon Termination or Change in Control

    | 2 | In the event the Corporation elects to terminate employment without cause (including during the one-year period following non-renewal of the employment agreement), other than in connection with a change in control, employment agreements with Messrs. |

  118. Potential Payments Upon Termination or Change in Control

    | Cherry, Long and Crone provide for payment in a lump sum of each executive’s annual base salary in effect immediately prior to termination and for continuing COBRA coverage, with the Corporation paying the employer portion of the cost of such coverage, for a period of twelve months, if the executive timely executes a general release of claims and complies with various post-employment covenants. Additionally, 11,867, 5,033, 2,100, 4,075 and 1,875 shares of restricted stock would immediately become vested for Messrs. Cherry, Long, Dillon, Crone and Seaman, respectively, provided however that with respect to Messrs. Cherry and Dillon, the vesting of these shares would be accelerated only if they did not continue to serve on the Boards of Directors of the Corporation and the Bank. The welfare benefits represent the net present value of such benefits costs for twelve months. |

  119. Potential Payments Upon Termination or Change in Control

    | 3 | Employment agreements with Messrs. Cherry, Long and Crone provide that in the event of termination of employment by the executive for good reason, as defined in the respective agreements, the executive would be entitled to the same severance and COBRA benefits described above in the case of termination by the Corporation without cause. |

  120. Potential Payments Upon Termination or Change in Control

    | 4 | In the case of each NEO, upon termination by the Corporation without cause following a change in control, or termination by the executive with good reason following a change in control, the executive would be entitled to severance based on a multiple of the sum of (1) his highest annual base salary during the 24 months preceding the change in control date and (2) his highest annual bonus in the three years preceding the year in which the change in control occurred. For Mr. Cherry, the multiple is 2.99 times, for Messrs. Long, Crone and Seaman, the multiple is 2 times, and for Mr. Dillon, the multiple is 2.5 times. The welfare benefits represent the net present value of benefits costs for three years in the case of Messrs. Cherry and Dillon and two years in the case of all other NEOs after the assumed change in control date. Additionally, unvested restricted stock and unvested balances in the Nonqualified Plan related to SERP contributions would immediately vest on the change in control date by the terms of the respective plans and agreements. The CIC Agreements provide for change in control benefits on a “best net after-tax” basis, such that the executive’s change in control benefits will be reduced to avoid excise taxes related to excess parachute payments under Section 280G of the Code only if such a reduction would result in greater after-tax compensation than without a reduction. The amounts shown in this table do not reflect any reductions that might be made pursuant to these provisions. |

  121. Potential Payments Upon Termination or Change in Control

    | 5 | In the case of Messrs. Dillon and Seaman, their CIC Agreements treat a termination by the Corporation without cause in anticipation of a change in control in the same manner as a termination without cause following a change in control. In the case of Messrs. Cherry, Long and Crone, their employment agreements provide for severance and continuing COBRA coverage upon termination without cause, including termination in anticipation of a change in control. In addition, their CIC Agreements provide for a special termination benefit in such circumstances. The special termination benefit for Mr. Cherry is the sum of two times his highest annual base salary in effect during the 24 months preceding his termination and three times his highest annual bonus in the three years preceding the year in which his termination occurs. For each of Messrs. Long and Crone, the special termination benefit is the sum of his highest annual base salary in effect during the 24 months preceding his termination and two times his highest annual bonus in the three years preceding the year in which his termination occurs. Additionally, unvested restricted stock would immediately become vested upon termination by the Corporation without cause, provided however that with respect to Messrs. Cherry and Dillon, the vesting of these shares would be accelerated only if they did not continue to serve on the Boards of Directors of the Corporation and the Bank. The CIC Agreements provide for change in control benefits on a “best net after-tax” basis, such that the executive’s change in control benefits will be reduced to avoid excise taxes related to excess parachute payments under Section 280G of the Code only if such a reduction would result in greater after-tax compensation than without a reduction. The amounts shown in this table do not reflect any reductions that might be made pursuant to these provisions. |

  122. Potential Payments Upon Termination or Change in Control

    | 6 | Messrs. Cherry, Long and Crone were not eligible for retirement or early retirement for purposes of the restricted stock accelerated vesting provisions, or in the case of Messrs. Long and Crone vesting of balances in the Nonqualified Plan related to SERP contributions, on December 31, 2023. Messrs. Dillon and Seaman were eligible for retirement at December 31, 2023. Upon retirement, 1,250 shares and 1,225 shares of unvested restricted stock for Messrs. Dillon and Seaman, respectively, would immediately vest, provided however that vesting would only be accelerated for Mr. Dillon if he also retired from service on the Boards of Directors of the Corporation and the Bank. Also upon retirement, unvested balances in the Nonqualified Plan related to SERP contributions for Mr. Seaman would immediately vest. Additionally, Mr. Dillon would be entitled to payment of medical, prescription and dental benefits for himself and his spouse for life, which is reported in this table as an actuarial present value of those benefits. |

  123. Potential Payments Upon Termination or Change in Control

    | 7 | Payments for separation of service due to disability or death include accelerated vesting of restricted stock, and Messrs. Long, Crone and Seaman would be immediately vested in balances in the Nonqualified Plan related to SERP contributions. Additionally, Mr. Dillon would be entitled to payment of medical, prescription and dental benefits for himself and his spouse for life, which is reported in this table as an actuarial present value of those benefits. |

  124. Potential Payments Upon Termination or Change in Control

    | 8 | None of the Corporation’s agreements with executives provide for 280G tax gross-up payments. |

  125. CEO Pay Ratio

    CEO Pay Ratio We determined that the 2023 annual total compensation of the median-compensated employee of all our employees, other than the CEO, as of December 31, 2023 was $59,910; the CEO’s 2023 annual total compensation was $1,292,911; and the ratio of these amounts was 22:1. As of December 31, 2023, our total population consisted of 579 employees, all of whom worked in the United States. This population consisted of all of our full-time and part-time employees. To identify the median compensated employee, we used a consistently applied compensation measure defined as wages reported on each employee’s 2023 IRS Form W-2. We further annualized pay for those individuals not employed for a full year in 2023, but who were employed as of December 31, 2023. This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described above. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

  126. Pay Versus Performance

    Pay Versus Performance Our executive compensation program is designed to be fair, reasonable, competitive and tied to the achievement of specific goals consistent with the overall strategy of the Corporation. We believe that this alignment between executive compensation and shareholder interests will drive corporate performance over time. The following information summarizes the relationship between compensation actually paid to NEOs and certain measures of financial performance of the Corporation. The amounts of compensation shown below are discussed in further detail in the Compensation Discussion and Analysis beginning on page 19 and in the preceding tables.

  127. Pay Versus Performance

    Pay Versus Performance

  128. Pay Versus Performance

    | | | | Average | | | | | | | | | | | | Summary | Average | Value of Initial Fixed $100 | | | | | | | | | | Compensation | Compensation | Investment Based on(3): | | | | | | | | Summary | | Table Total | Actually Paid | | 2023 Peer | 2022 Peer | | | | | | Compensation | Compensation | for Non-PEO | to Non-PEO | Total | Group Total | Group Total | | | | | | Table Total | Actually Paid | Named Executive | Named Executive | Shareholder | Shareholder | Shareholder | Net Income | Adjusted | Adjusted | | | for PEO(1) | to PEO(2) | Officers(1) | Officers(2) | Return | Return | Return | (in thousands) | ROE(4) | ROA(4) | | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | (%) | (%) | | 2023 | 1,292,911 | 1,376,927 | 535,423 | 546,486 | 141.4 | 104.0 | 101.0 | 23,746 | 11.68 | 0.99 | | 2022 | 1,160,058 | 1,236,413 | 530,208 | 553,696 | 117.2 | 104.9 | 100.7 | 29,369 | 13.64 | 1.16 | | 2021 | 1,157,133 | 1,363,725 | 962,681 | 982,576 | 99.7 | 103.8 | 106.4 | 29,123 | 15.22 | 1.38 | | 2020 | 977,599 | 672,340 | 1,092,857 | 865,040 | 70.1 | 77.9 | 74.3 | 22,424 | 12.54 | 1.14 |

  129. Pay Versus Performance

    | 1 | The amounts shown above are the amounts reported in the Summary Compensation Table on page 43 as total compensation for Mr. Cherry, who was the principal executive officer (“PEO”) for all years presented, and the average for each year of total compensation for the NEOs other than the PEO in each year, including Messrs. Long, Dillon, Crone and Seaman for 2023, and including Messrs. Long, Dillon and Crone and Bryan McKernon, President and CEO of C&F Mortgage Corporation, for years 2020-2022. |

  130. Pay Versus Performance

    | 2 | Compensation actually paid to Mr. Cherry represents total compensation reported in the Summary Compensation Table, with certain adjustments as described below. Compensation actually paid differs from the amount shown in the Summary Compensation Table and does not represent the total amount earned or total amount paid in any particular year. Total compensation, as reported in the Summary Compensation Table, was adjusted by (1) removing the change in pension value, which represents the actuarial increase in present value of accumulated benefits in each year under the Retirement Plan established by the Bank for Messrs. Cherry, Long, Dillon and Seaman; (2) including the amount of service cost recognized by the Corporation under ASC Topic 715, which represents the actuarial present value of benefits under the Retirement Plan attributable to services rendered in each year for Messrs. Cherry, Long, Dillon and Seaman; (3) removing the grant date fair value of stock awards granted in each year, as determined under ASC Topic 718; (4) including with respect to outstanding restricted stock awards for each year (i) the year-end fair value of any awards granted during the year that are outstanding and unvested as of the end of the year; (ii) the change in fair value as of the end of the year (from the end of the prior year) of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; and (iii) for awards granted in prior years that vested in the applicable year, the change in fair value as of the vesting date (from the end of the prior year). Total compensation as reported in the Summary Compensation Table and compensation actually paid both include the amount of dividends paid on unvested restricted stock awards. |

  131. Pay Versus Performance

    The amounts of the adjustments described above that were added to (or deducted from) the Summary Compensation Table total for the PEO to arrive at compensation actually paid for the PEO for 2023 are shown in the table below.

  132. Pay Versus Performance

    | | | | Year End | | Change in | | | | Grant Date | Fair Value of | Change in Fair Value | Fair Value of Stock Awards | | Change in | Pension | Fair Value of | Stock Awards | of Outstanding and | Granted in Prior Years that | | Pension Value | Service Cost | Stock Awards | Granted | Unvested Stock Awards | Vested in the Year | | ($) | ($) | ($) | ($) | ($) | ($) | | (70,381) | 33,244 | (249,275) | 288,061 | 75,732 | 6,635 |

  133. Pay Versus Performance

    The amounts of the adjustments described above that were added to (or deducted from) the average Summary Compensation Table total for NEOs other than the PEO to arrive at average compensation actually paid to non-PEO NEOs for 2023 are shown in the table below.

  134. Pay Versus Performance

    | | | | Year End | | Change in | | | | Grant Date | Fair Value of | Change in Fair Value | Fair Value of Stock Awards | | Change in | Pension | Fair Value of | Stock Awards | of Outstanding and | Granted in Prior Years that | | Pension Value | Service Cost | Stock Awards | Granted | Unvested Stock Awards | Vested in the Year | | ($) | ($) | ($) | ($) | ($) | ($) | | (27,316) | 4,179 | (68,588) | 79,259 | 20,893 | 2,636 |

  135. Pay Versus Performance

    | 3 | Cumulative total shareholder return is calculated assuming $100 was invested in the common stock of the Corporation or in the stock of the financial institutions included in a group of peer companies on December 31, 2019, and assumes the reinvestment of dividends. For 2023, the group of peer companies consists of the 2023 Incentive Compensation Peer Group (the “2023 Peer Group”). For more information on the financial institutions included in the 2023 Incentive Compensation Peer Group, refer to page 28 and to the stock performance graph included in Item 5. “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities,” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 27, 2024. Previously, the Corporation reported a different group of peer companies. Our prior peer group consisted of the following 23 financial institutions from our 2022 Incentive Compensation Peer Group (the “2022 Peer Group”): American National Bankshares, Inc., Blue Ridge Bankshares, Inc., CapStar Financial Holdings, Inc., Carter Bankshares, Inc., Eagle Financial Services, Inc.; F&M Bank Corporation, First Community Bankshares, Inc., First Community Corporation, First National Corporation, First United Corporation, FVCBankcorp, Inc., HomeTrust Bankshares, Inc., Limestone Bancorp, Inc., MainStreet Bancshares, Inc., National Bankshares, Inc., Old Point Financial Corporation, Peoples Bancorp of North Carolina, Inc., Primis Financial Corporation, Shore Bancshares, Inc., Southern First Bancshares, Inc., Summit Financial Group, Inc., The Community Financial Corporation, and Virginia National Bankshares Corporation. For more information on the financial institutions included in the 2022 Incentive Compensation Peer Group, refer to the Corporation’s 2023 proxy statement, filed with the SEC on March 10, 2023. In 2023, the Corporation changed the composition of the peer group used to evaluate the financial performance of the Corporation primarily by expanding the geography included in the peer group, as the factors that affect competition, financial performance, and access to capital for the Corporation and its peers are generally not unique to the state(s) in which they operate. As such, the 2023 Incentive Compensation Peer Group includes peer companies headquartered in thirteen states in the Eastern and Southern U.S. Additional information can be found in Item 5. “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities,” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 27, 2024. For purposes of the cumulative total shareholder return reported in this table, the 2023 Peer Group and the 2022 Peer Group are weighted according to the respective financial institution’s market capitalization as of December 31, 2019. |

  136. Pay Versus Performance

    | 4 | Adjusted ROE and adjusted ROA are financial measures that are not consistent with U.S. GAAP that are considered by the Corporation as part of its executive compensation program. Refer to Appendix A for information regarding these non-GAAP financial measures, including a reconciliation to the most directly comparable U.S. GAAP financial measures. The Committee has identified a variety of performance goals and metrics used for the purpose of awarding compensation to executive officers that are consistent with the Corporation’s overall compensation philosophy and the long-term interests of its shareholders. Among these, the Committee has identified adjusted ROE as the most important financial performance measure (that is not otherwise required to be disclosed in the table above) used by the Corporation to link compensation actually paid to its NEOs for the year ended December 31, 2023 to company performance. Adjusted ROA, which is also used by the Corporation to evaluate performance as part of its executive compensation program, is shown in the table above as a supplemental financial performance measure. |

  137. Pay Versus Performance

    The relationship between (1) compensation actually paid to the PEO and the average of compensation actually paid to NEOs other than the PEO and (2) cumulative total shareholder return on the common stock of the Corporation, cumulative total shareholder return on the stock of the 2023 Peer Group and cumulative total shareholder return on the stock of the 2022 Peer Group for the last four completed fiscal years is shown in Figure 1.

  138. 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 of compensation actually paid to NEOs other than the PEO and (2) net income of the Corporation for the last four completed fiscal years is shown in Figure 2.

  139. Figure 2: Compensation Actually Paid and Net Income

    Figure 2: Compensation Actually Paid and Net Income The Committee has identified adjusted ROE as the most important financial performance measure (that is not otherwise required to be disclosed in the table above) used by the Corporation to link compensation actually paid to its NEOs for the year ended December 31, 2023 to company performance. The Committee uses a composite ranking of the Corporation’s ROE and ROA performance (as defined by the Committee, which excludes the effect on ROE of accumulated other comprehensive income) among the financial institutions of the 2023 Incentive Compensation Peer Group in the determination of short-term cash incentive compensation awards for Messrs. Cherry and Long, as discussed further beginning on page 30. (Adjusted ROA is also shown in the table above as a supplemental financial performance measure.) The Committee also uses the Corporation’s three-year ROTCE (as defined by the Committee, which excludes the effect of accumulated other comprehensive income) relative to the 2023 Incentive Compensation Peer Group in the determination of Long-Term Equity Incentive Compensation Awards for each NEO, as discussed further beginning on page 33. Adjusted ROE, as reported by the Corporation, is reviewed by the Committee in making decisions regarding compensation of executive officers, and is closely related to both ROE as defined by the Committee for purposes of the short-term cash incentive compensation award and ROTCE as defined by the Committee for purposes of the long-term equity incentive compensation award. The relationship between (1) compensation actually paid to the PEO and the average of compensation actually paid to NEOs other than the PEO and (2) adjusted ROE for the last four completed fiscal years is shown in Figure 3.

  140. Figure 3: Compensation Actually Paid and Adjusted ROE

    Figure 3: Compensation Actually Paid and Adjusted ROE The relationship between (1) compensation actually paid to the PEO and the average of compensation actually paid to NEOs other than the PEO and (2) adjusted ROA, which is presented as a supplemental financial performance measure, for the last four completed fiscal years is shown in Figure 4.

  141. Figure 4: Compensation Actually Paid and Adjusted ROA

    Figure 4: Compensation Actually Paid and Adjusted ROA The following table lists the financial performance measures determined by the Committee to be the most important financial performance measures used by the Corporation to link compensation actually paid to its NEOs for the year ended December 31, 2023 to company performance.

  142. Figure 4: Compensation Actually Paid and Adjusted ROA

    | Financial Performance Measures Linked to Compensation of Executives | | Net income | | Adjusted ROE | | Adjusted ROA | | ROE (as defined by the Committee) | | ROTCE (as defined by the Committee) | | Loan delinquencies | | Net charge-off ratio |