DEF 14A of Farmers National Banc Corp /Oh/, Mar 19, 2024

DEF 14A of Farmers National Banc Corp /Oh/

Filed Mar 19, 2024 · FY20230001193125-24-071352

Open on EDGAR

  1. PROPOSAL ONE — ELECTION OF DIRECTORS

    PROPOSAL ONE — ELECTION OF DIRECTORS In accordance with the provisions of Farmers’ Regulations, the Board of Directors has fixed the number of directors at 13 for the upcoming Annual Meeting. The Board of Directors is currently divided into three classes, each with three-year terms. This year, the Corporate Governance and Nominating Committee has recommended to the Board of Directors the re-nomination of the four Class II directors for election to serve as Class II directors for terms of three years to expire at the Annual Meeting of Shareholders to be held in 2027. If these nominees are elected, there will be four directors serving in Class I, four directors serving in Class II, and five directors serving in Class III. Set forth below for each of the nominees for election and for each director whose term will continue after the Annual Meeting is a brief statement, including age, principal occupation and business experience during at least the past five years. In addition, the following information provides the Corporate Governance and Nominating Committee’s evaluation regarding the nomination of the director nominees and the key attributes, skills, and qualifications presented by the director nominees and the continuing directors. The following information, as of March 5, 2024, with respect to the age, principal occupation or employment, other affiliations and business experience during at least the last five years of each director and director nominee, has been furnished to Farmers by each director nominee and director. Except where indicated, no corporation is a parent, subsidiary, or other affiliate of Farmers. Proxies cannot be voted for a greater number of persons than the number of nominees named in this proxy statement. If any nominee should become unavailable to serve for any reason, it is intended that votes will be cast for a substitute nominee designated by the Corporate Governance and Nominating Committee and approved by the Board of Directors. The Corporate Governance and Nominating Committee has no reason to believe that any nominee named will be unable to serve if elected.

  2. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”

    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE FOLLOWING DIRECTOR NOMINEES.

  3. NOMINEES FOR ELECTION AS CLASS II DIRECTORS

    NOMINEES FOR ELECTION AS CLASS II DIRECTORS

  4. NOMINEES FOR ELECTION AS CLASS II DIRECTORS

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | David Z. Paull | 69 | Mr. Paull has served as a director of Farmers since 2011 and is a member of the Board Enterprise Risk, Compensation and Executive Committees. Mr. Paull retired in 2014 from serving as the Vice President, HR Operations and Labor Relations, for RTI International Metals, Inc., where he had previously been responsible for human resource activities for all domestic manufacturing locations in the United States. Mr. Paull has 36 years of experience working in and managing all aspects of the human resources and employee benefits functions, significant experience in corporate strategic and succession planning with both for-profit and nonprofit enterprises, and has served as a member of the board of directors and executive committee of the Youngstown Warren Regional Chamber of Commerce, serves on the board of the Dorothy Day House and serves on the board of Leadership Mahoning Valley. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Paull has developed through his extensive business experience in the Mahoning Valley business market, as well as his knowledge and experience in the field of human resources, allow him to provide compensation-related and local business expertise to the Board of Directors. | | Gina A. Richardson | 51 | Ms. Richardson has served as a director of Farmers since September 1, 2023 and is a member of the Audit and Corporate Governance and Nominating Committees. Ms. Richardson has 25 years of business law experience, serving clients in a wide range of industries, with a focus on business and commercial transactions, business succession planning, real estate and employee compensation. Prior to establishing her own firm in Canfield, Ms. Richardson was a shareholder with a regional law firm where she served as an officer and a director. She is active in the community, serving on the board of directors of Salem Regional Medical Center, where she holds leadership positions as its Treasurer and Chair of the Finance, Quality Improvement, and Compliance Committees. She also serves or has served on a variety of boards of directors including Farmers Trust Company, Firestone Surgery Center, LLC, Salem-Republic Rubber Company, the Youngstown Symphony Society, Children’s Rehabilitation Center, Christina’s Garden, the American Red Cross and the Eastern Ohio Area Health Education Center. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Ms. Richardson has developed through her legal education and business leadership experiences allow her to provide regional business and leadership expertise to the Board of Directors. |

  5. NOMINEES FOR ELECTION AS CLASS II DIRECTORS

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | Andre Thornton | 74 | Mr. Thornton has served as a director of Farmers since January 1, 2023 and is a member of the Board Enterprise Risk and Corporate Governance and Nominating Committees. Mr. Thornton has served as the Chief Executive Officer of ASW Global, LLC, a privately-held supply chain management company, since he acquired the company in 2007. Mr. Thornton has 36 years of experience in entrepreneurial ventures and mergers and acquisitions. Mr. Thornton frequently speaks nationally on issues of executive leadership, organization change, and diversity and inclusion. Mr. Thornton played professional baseball for 21 years and was an honored recipient of the Roberto Clemente Award in 1979. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Thornton has from his extensive experiences in owning and managing businesses, corporate transactions, and diversity and inclusion allow him to provide business and corporate governance expertise to the Board of Directors. | | Nicholas Varischetti | 40 | Mr. Varischetti has served as a director of Farmers since January 1, 2023 and is a member of the Audit and Corporate Governance and Nominating Committees. Mr. Varischetti is a partner at the Burns White law firm in Pittsburgh, Pennsylvania, assisting businesses from a wide range of industries with their litigation, general business, and advisement needs. Mr. Varischetti formerly served from 2015 to 2022 as a director of Emclaire Financial Corp., which was acquired by Farmers effective January 1, 2023. Mr. Varischetti is also a partner in Varischetti Holdings, LP, a family-owned and operated organization consisting of several different businesses, including real estate investments, powder metal manufacturing, a construction equipment dealership, an oil and gas field services company, and waste industry consulting. Additionally, Mr. Varischetti is a founding partner of Allegheny Strategy Partners, a privately-held advisory firm. Furthermore, Mr. Varischetti is a shareholder and director of Guardian Elder Care Holdings, Inc., a healthcare provider with more than 50 nursing facilities, a rehabilitation services business, a long-term care pharmacy, and a home health company. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Varischetti has from his legal background, business ownership, and involvement with various business and civic organizations allow him to provide business, organizational, and advisory expertise to the Board of Directors. |

  6. CLASS III DIRECTORS CONTINUING IN OFFICE

    CLASS III DIRECTORS CONTINUING IN OFFICE

  7. CLASS III DIRECTORS CONTINUING IN OFFICE

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | Carl D. Culp | 60 | Mr. Culp has served as a director of Farmers since September 1, 2023 and is a member of the Board Enterprise Risk Management Committee. Mr. Culp spent 32 years at Farmers Bank and retired in 2021 as the Senior Executive Vice President and Chief Financial Officer. Mr. Culp is a certified public accountant. A graduate of Youngstown State University, Mr. Culp is currently a member of the Finance Committee of the United Way of Youngstown and the Mahoning Valley and a member of the Rotary Club of Canfield. He has previously held board positions with the United Way, Shepherd of the Valley Lutheran Retirement Services, and the Youngstown State University Accounting and Finance Advisory Council. | | Ralph D. Macali | 68 | Mr. Macali has served as a director of Farmers since 2001 and is a member of the Audit and Corporate Governance and Nominating Committees. Mr. Macali is the Vice President of Palmer J. Macali, Inc., which owns and operates a retail grocery supermarket, and a partner in P.M.R.P. Partnership, which owns commercial and residential real estate properties. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Macali has developed through his education and business leadership experiences in the Mahoning Valley business market, as well as his experience as a director of Farmers, allow him to provide continued regional business and leadership expertise to the Board of Directors. | | Frank J. Monaco | 63 | Mr. Monaco has served as a director of Farmers since 2021. He is the Chair of the Compensation Committee and a member of the Board Enterprise Risk Management Committees. Mr. Monaco is a Senior Partner at the 415 Group, Inc., a certified public accounting, business consulting and IT services firm in Canton, Ohio. In this role, Mr. Monaco leads the consulting division of the firm, which includes business and estate planning, business valuations, litigation, and mergers and acquisitions. Mr. Monaco has been with 415 Group since 1993 and previously served as Managing Partner from 2003 to 2019. He holds accreditations of Certified Public Accountant (CPA) and is Certified in Financial Forensics (CFF), along with being Accredited in Business Valuation (ABV) and part of the National Association of Certified Valuation Analysts (CVA). Mr. Monaco also is an active member of his community, serving on or having served on a variety of boards of directors including serving as Vice Chairman of Pro Football Hall of Fame, Canton Regional Chamber of Commerce, Stark Development Board, and Stark County Port Authority. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Monaco has developed through his educational background in business and accounting, as well as his business and leadership experiences as a certified public accountant and managing partner of a firm, allow him to provide accounting, local business, and leadership expertise to the Board of Directors. |

  8. CLASS III DIRECTORS CONTINUING IN OFFICE

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | Edward W. Muransky | 64 | Mr. Muransky has served as a director of Farmers since 2017. He is Chair of the Board Enterprise Risk Management Committee and a member of the Corporate Governance and Nominating and Executive Committees. Since 2023, Mr. Muransky has served as owner and Chief Executive Officer of Ohio Management Services, Inc. and since 1999, he has served as Chairman of the Board of The Muransky Companies, a multifaceted business management company, Chairman and Chief Executive Officer of Southwoods Health, and Chairman and Chief Executive Officer of Chestnut Land Company, the parent company for Auntie Anne’s Soft Pretzel franchises operating throughout the United States. Mr. Muransky serves on boards of directors of a number of charitable and educational organizations in the Youngstown, Ohio and Mahoning Valley, Ohio region, including the Youngstown State University Foundation. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Muransky has developed through his significant business and leadership experiences allow him to provide leadership and business expertise to the Board of Directors. | | Richard B. Thompson | 75 | Mr. Thompson has served as a director of Farmers since 2021 and is a member of the Audit and Board Enterprise Risk Management Committees. Mr. Thompson formerly served from 2001 to 2021 as a director of Cortland Bancorp, which was acquired by Farmers in 2021. Mr. Thompson has had an extensive background in the private and public sectors for more than 40 years. A graduate of Youngstown State University with a degree in Electrical Engineering, he began his career in 1972 as an Electrical Engineer for The Packard Electric Company. Mr. Thompson co-founded Therm-O-Link Inc., a manufacturer of electrical wire and cable and was an active partner in the business until 1994. Recently, Mr. Thompson has focused on the revitalization of his beloved town of Kinsman, Ohio, including the reopening of the local grocery store and hardware store, as well as starting a successful architectural millwork company, Stratton Creek Woodworks. Mr. Thompson also serves on the board of directors for Hiram College, The Youngstown State University Foundation, The Northern Trumbull County Community Foundation, The Kinsman Public Library, The Kinsman United Methodist Church and Trumbull Family Fitness. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Thompson has developed through his business and leadership experiences allow him to provide leadership and business expertise to the Board of Directors. |

  9. CLASS I DIRECTORS CONTINUING IN OFFICE

    CLASS I DIRECTORS CONTINUING IN OFFICE

  10. CLASS I DIRECTORS CONTINUING IN OFFICE

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | Gregory C. Bestic | 69 | Mr. Bestic has served as a director of Farmers since 2011 and is currently Chair of the Audit Committee and a member of the Compensation Committee. Mr. Bestic also served as a director of Farmers Trust Company, a Farmers subsidiary, from March 2016 through April 2023. Mr. Bestic was a Principal in Schroedel, Scullin & Bestic, LLC, a certified public accounting and strategic advisory firm located in Canfield, Ohio. Mr. Bestic practiced with Schroedel, Scullin & Bestic, LLC and its predecessor firm from 1980 until his retirement in 2022. Mr. Bestic is a certified public accountant retired, was a certified forensic accountant (Diplomate of the American Board of Forensic Accounting) and a fellow of the American College of Forensic Examiners. He has served on a number of non-profit community and civic boards in the Mahoning Valley, including the Cardinal Joint Fire District, Salem Regional Medical Center and the Advisory Committee of the Accounting and Finance Department of Youngstown State University. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Bestic has developed through his educational background in business and accounting, as well as his business and leadership experiences in the Mahoning Valley, allow him to provide accounting, local business, and corporate governance expertise to the Board of Directors. | | Kevin J. Helmick | 52 | Mr. Helmick has served as a director of Farmers since 2014, as the President and Chief Executive Officer of Farmers since November 2013, and is a member of the Executive Committee. Prior to his appointment as President and Chief Executive Officer, Mr. Helmick served as the Executive Vice President and Secretary of the Company and Executive Vice President – Retail and Wealth Management of Farmers Bank since January 2012. Prior to that, Mr. Helmick served as the Vice President of Wealth Management and Retail Services of Farmers Bank since 2008. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Helmick has developed through his education and experiences in the banking and financial services industries, as well as his significant past leadership positions with Farmers, allow him to provide continued business and leadership insight to the Board of Directors. |

  11. CLASS I DIRECTORS CONTINUING IN OFFICE

    | Name | Age | Principal Occupation for at least Past Five Years and Other Information | | Neil J. Kaback | 63 | Mr. Kaback has served as a director of Farmers since 2021 and is a member of the Audit and Board Enterprise Risk Management Committees. Mr. Kaback served as a Partner, Assurance, at Cohen & Company, in their Youngstown, Ohio office until his retirement in 2022. He has spent more than 40 years assisting clients and companies in the manufacturing, distribution, transportation, automotive and service industries. Mr. Kaback holds accreditations of certified public accountant and chartered global management accountant and is a member of the Ohio Society of Certified Public Accountants and American Institute of Certified Public Accountants. Mr. Kaback currently serves or has served on a variety of boards of directors including the Youngstown Warren Regional Chamber, United Way of Youngstown and the Mahoning Valley, Trumbull Memorial Health Foundation and GOJO Industries. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Kaback has developed through his educational background in business and accounting, as well as his business and leadership experiences as a certified public accountant in the Mahoning Valley, allow him to provide accounting and local business expertise to the Board of Directors. | | Terry A. Moore | 68 | Mr. Moore has served as a director of Farmers since 2014 and is Chair of the Board of Directors and Executive Committee. He is a member of the Compensation and Corporate Governance and Nominating Committees. Mr. Moore is employed by Krugliak, Wilkins, Griffiths & Dougherty, a law firm located in Canton, Ohio. Mr. Moore served as Managing Shareholder for 18 years until 2018 and as a member of the firm’s Management Committee for 24 years. He serves on the Board of Trustees for the Cleveland Clinic Mercy Hospital Foundation Board and served as its initial Chair. He serves on the Advisory Board for the Cleveland Clinic Mercy Hospital and as a Trustee of the Hoover Foundation, a non-profit foundation in Canton. The Corporate Governance and Nominating Committee believes that the attributes, skills and qualifications Mr. Moore developed through his educational background in law, as well as his business, litigation and leadership experiences with his law firm allow him to provide leadership, local business, and corporate governance expertise to the Board of Directors. |

  12. CLASS I DIRECTORS CONTINUING IN OFFICE

    Farmers also extends it deep gratitude to Anne Frederick Crawford for her dedicated service to the Company. Ms. Crawford will be retiring from her service as a director at the expiration of her current term at the 2024 Annual Meeting. She has served as a director since 2004 and most recently served as Chair of the Corporate Governance and Nominating Committee.

  13. Executive Summary

    | • | Adjusted net income for 2023 totaled $61.8 million, or $1.65 per diluted share, compared to $64.0 million, or $1.89 earnings per diluted share, for 2022. This financial metric was one of the three objective elements of our 2023 annual cash incentive plan (the “Annual Incentive Plan”). The threshold performance level for this metric was $1.63 and target performance level for this metric was $1.75, so our performance resulted in payouts to our named executive officers at 60%, below the target level of bonuses on this financial performance metric. |

  14. Executive Summary

    | • | Our 2023 annualized return on average assets as adjusted was 1.23% compared to 1.54% for 2022. This financial metric was the second objective element of our Annual Incentive Plan. The threshold performance level for this metric was 1.19% and the target was 1.28%, so our performance on this metric resulted in payouts of 72% for performance slightly below the target level of this financial performance metric. |

  15. Executive Summary

    | • | Our 2023 pre-tax, pre-provision income as adjusted was $77.9 million in 2023. This financial metric was the third objective performance element of our Annual Incentive Plan, included for the first time in 2023 to replace efficiency ratio. In 2022, efficiency ratio was utilized as a third objective performance metric in our Annual Incentive Plan. The threshold performance level for this metric was $83.5 million, and the target was $88.6 million, so our performance resulted in no payout on this financial |

  16. Executive Summary

    | performance metric. Although this financial result fell below our expectations, the resulting lack of payout on this metric evidences the strong and direct linkage of our compensation programs with our objective financial performance. |

  17. Significant 2023 Compensation Results

    | • | We maintained the general structure of our Annual Incentive Plan for executive officers in 2023, comprised of three objective corporate level financial metrics, but replaced the prior financial metric of efficiency ratio with core pre-tax, pre-provision net income: (i) adjusted earnings per share, (ii) annualized adjusted return on average assets, and (iii) pre-tax pre-provision net income. Mr. Shaffer and Mr. Wenick had additional objective metrics based on their respective areas of responsibility. We also retained a subjective element for each named executive officer, with a weighting of 20% for Messrs. Helmick, Adair, and Matuszak, 15% for Mr. Shaffer, and 25% for Mr. Wenick. The subjective factor is evaluated based on a scorecard assessment of each individual’s performance. All elements and results of our 2023 Annual Incentive Plan for our named executive officers are more fully described under “2023 Named Executive Officers Compensation – Annual Incentive Plan.” The following is a tabular summary of our 2023 Annual Incentive Plan payouts based on our 2023 adjusted financial results: |

  18. Significant 2023 Compensation Results

    | Performance Metric | Target | Actual | Payout % | | Earnings Per Share | $1.75 | $1.65 | 60% | | Return on Average Assets | 1.28% | 1.23% | 72% | | Pre-tax Pre-provision Net Income | $88.6 | $77.9 | 0% | | (in millions) | | | |

  19. Significant 2023 Compensation Results

    | • | In the first calendar quarter of 2023, we granted equity-based long-term incentive compensation awards under our 2022 Equity Incentive Plan and cash-based long-term incentive compensation awards under our long-term cash incentive compensation plan (“LTI Cash Program”) to help achieve our recruiting, retention, and long-term performance goals. We maintained the following allocation of our total long-term compensation target opportunities: 25% service-based equity awards subject to three-year cliff vesting, 50% performance-based equity awards subject to vesting determined by our average return on equity (“ROE”) compared to the ROE performance of our peer group of banking companies over a three-year period, and 25% performance-based cash awards subject to vesting determined by our total shareholder return (“TSR”) compared to peer group performance over a three-year period. |

  20. Significant 2023 Compensation Results

    | • | The results of our performance-based long-term incentive awards issued in 2021 for the three-year period that ended on December 31, 2023 were as follows: (i) the long-term incentive awards based on our average return on equity achieved the maximum payout of 200% due to our top performance relative to our compensation peer group, and (ii) the long-term incentive awards based on our total shareholder return achieved a payout between the threshold and target levels based on our performance between the lower quartile and median of our compensation peer group, as described more fully under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans”: |

  21. Significant 2023 Compensation Results

    | | Weight(1) | Target Percentile | Actual Percentile | Percentage Payout | | Relative Average ROE(2) | 50% | 50(th) | 100(th) | 200.0% | | Relative TSR(3) | 25% | 50(th) | 33(rd) | 46.7% |

  22. Significant 2023 Compensation Results

    | (1) Weighting percentage based on total target long-term incentive opportunity; service-based restricted stock grants comprise the remaining 25% opportunity. |

  23. Significant 2023 Compensation Results

    | (2) Equity-based award with performance and vesting determined as a percentile compared to the average annual return on equity of peer group companies for the three-year period ending December 31, 2023. These equity-based awards were granted at the maximum payout level of 200% (2 times) of target opportunity, so the percentage payout opportunities ranged from 10% vesting for attaining the threshold 25th percentile of the peer group, 25% for performing at the 50th percentile, and 100% for performing at or above the 75th percentile. |

  24. Significant 2023 Compensation Results

    | (3) Cash-based award with performance and vesting determined as a percentile compared to the total shareholder return of peer group companies for the three-year period ending December 31, 2023. Percentage payout opportunity ranged from 20% at the threshold 25th percentile of the peer group, 100% for performing at the 50th percentile, and 200% for performing at or above the 75th percentile. |

  25. Role of Compensation Consultant

    Role of Compensation Consultant The Compensation Committee has engaged Pay Governance, LLC (“Pay Governance”) as its outside independent compensation consultant since 2011 and continued to engage Pay Governance during 2023. Pursuant to its engagement terms, Pay Governance reviews, analyzes and provides advice regarding our executive officer and director compensation programs in relation to the objectives of those programs, including comparisons to designated peer group companies and to current best practices, and also provides information and advice on competitive compensation practices and trends, along with specific views on our compensation programs. In its role as independent compensation consultants, Pay Governance representatives engage in regular discussions with the Compensation Committee and respond to questions from the Committee and the Committee’s other advisors in providing opinions with respect to the design and implementation of current or proposed compensation programs. During 2023, Pay Governance reported directly to the Compensation Committee and the Committee retains the sole authority to retain or terminate Pay Governance. Pay Governance did not provide additional services to the Company or its affiliates in an amount in excess of $120,000 during 2023. Compensation Consultant Independence The Compensation Committee has the responsibility to consider certain independence factors before selecting compensation consultants and other compensation advisers. In connection with the foregoing, the Compensation Committee reviewed, considered and discussed the relevant factors established by NASDAQ to determine such independence, both through surveying Pay Governance and by soliciting input from members of the Compensation Committee through our annual director and officer questionnaires. Based on its review, consideration and discussion, the Compensation Committee determined that the work performed and to be performed by Pay Governance as the Committee’s compensation consultant has not raised and does not raise any conflict of interest, and also determined that Pay Governance qualifies as independent for purposes of the Exchange Act and NASDAQ Corporate Governance Requirements.

  26. Peer Group Evaluation and Executive Compensation Benchmarks

    Peer Group Evaluation and Executive Compensation Benchmarks The Compensation Committee generally has evaluated compensation practices at similarly situated financial institutions to help determine appropriate levels of compensation for financial services executives in our geographic market. The Compensation Committee does not adhere to a strict formula in order to determine executive officer compensation packages, but rather it has relied on a variety of factors including experience, responsibility, individual performance, and our overall financial performance. However, given the competitive nature of the financial services industry generally and the fact that we compete in a market with many significantly larger regional and national banking organizations which can provide attractive compensation packages to top executive talent, the Compensation Committee recognizes the need for Farmers to provide compensation opportunities to retain our high-performing executives and attract new executive talent that are competitive with our identified peer group companies. The Compensation Committee has consistently utilized a compensation peer group of companies for certain compensation benchmarking purposes. The Compensation Committee uses several factors to identify, evaluate and select peer financial institutions including but not limited to (i) factors of size (e.g., assets (ranging from approximately one-half to two times the asset size of Farmers), revenues, employees, and market capitalization), (ii) factors of profitability and growth (e.g., net revenue and operating income), and (iii) geographic location. Following our announcement in March 2022 of the acquisition of Emclaire Financial Corp., the holding company of The Farmers National Bank of Emlenton, a national bank based in Pennsylvania, the Compensation Committee, with the assistance of Pay Governance, considered certain revisions to the peer group to continue to reflect the evaluative factors described above in light of the expected increase of Farmers’ asset size to over $5 billion in assets and the expansion of Farmers’ active geographic competitive footprint. Based on that evaluation, the Compensation Committee determined to focus on peer banking companies with assets between $2.5 billion and $10 billion that operated in a geographic market including Ohio, western Pennsylvania, Michigan, West Virginia, Kentucky, Indiana, and western New York. This evaluation resulted in the elimination of five companies from the previous peer group and the addition of the following four companies: First Commonwealth Financial, First Internet Bancorp, S&T Bancorp, and Park National Corporation, resulting in the following compensation peer group of 21 companies approved by the Compensation Committee for 2023 (“2023 Peer Group”):

  27. Peer Group Evaluation and Executive Compensation Benchmarks

    | • City Holding Company | • Lakeland Financial Corporation | | • Civista Bancshares, Inc. | • Macatawa Bank Corporation | | • Community Trust Bancorp, Inc. | • Mercantile Bank Corporation | | • CNB Financial Corporation | • MVB Financial Corp. | | • Financial Institutions, Inc. | • Park National Corporation | | • First Commonwealth Financial | • Peoples Bancorp Inc. | | • First Financial Corporation | • Premier Financial Corp. | | • First Internet Bancorp | • S&T Bancorp | | • German American Bancorp, Inc. | • Summit Financial Group, Inc. | | • Horizon Bancorp, Inc. | • Stock Yards Bancorp, Inc. | | • Independent Bank Corporation | |

  28. 2023 Named Executive Officers Compensation

    2023 Named Executive Officers Compensation Base Salary Base salaries are intended to reward our named executive officers based on their roles with us and for their performance in those roles. For each named executive officer, base salaries are reviewed annually subject to adjustments based upon our financial performance, the individual performance of the particular executive, and our overall compensation philosophy of providing compensation opportunities to retain our high performing executive officers and attract new executive talent that are competitive with our 2023 Peer Group. The Compensation Committee conducts an annual evaluation of the performance of Mr. Helmick in light of specified goals and objectives with input from each independent director. Based on such evaluation and input, the Compensation Committee determines the compensation of Mr. Helmick and discusses its determination with all independent directors. During late 2022 and early 2023, the Compensation Committee also undertook an extensive analysis of the amounts and elements of Mr. Helmick’s compensation and certain other executive officers, including recent realized pay of Mr. Helmick, with significant input from PayGovernance and benchmarking to the 2023 Peer Group and the new peer group. All other executive officers are evaluated on a variety of factors including leadership performance, strategic planning and execution, communication abilities, business knowledge, and awareness and accountability. Based thereon, Mr. Helmick determines whether to recommend base salary increases or decreases based upon individual performance and presents his recommendations on base salary adjustments to the Compensation Committee. As a result of the evaluations by the Compensation Committee of Mr. Helmick and the recommendations by Mr. Helmick regarding the remaining named executive officers as described above, the following merit-based base salary adjustments were determined for Mr. Helmick and the other named executive officers effective April 1, 2023:

  29. 2023 Base Salaries and Adjustments

    Annual Incentive Plan The Compensation Committee believes that performance-based annual cash incentives are an effective way to compensate executives for working together as a team to achieve short-term specific financial goals, which the Compensation Committee and management have established as near-term drivers of our long-term success, as well as certain individualized goals specific to an executive’s role and duties. The following is a discussion of the Annual Incentive Plan as implemented by the Compensation Committee during 2023. The Annual Incentive Plan is intended to foster superior financial results by providing equitable and attainable corporate-wide incentives that reward individual and team efforts to achieve specified performance objectives as determined and applied each fiscal year. The program provides our executive officers and certain non-executive employees the opportunity to receive annual cash incentive payments based upon achievement of such corporate and individual performance goals. Our full-time and part-time, regular, non-commissioned-based associates and executives, as well as those of our subsidiaries, are generally eligible to participate in the Annual Incentive Plan. The Compensation Committee establishes the target bonus opportunities under the Annual Incentive Plan for each eligible named executive officer expressed as a percentage of base salary. The following table sets forth the 2023 target bonus opportunities for each participating named executive officer:

  30. 2023 Base Salaries and Adjustments

    | Named Executive Officer | Target Annual Incentive Plan Opportunity (% of base salary) | | Kevin Helmick | 50% | | Troy Adair | 35% | | Myke Matuszak | 35% | | Timothy Shaffer | 35% | | Mark Wenick | 35% |

  31. 2023 Base Salaries and Adjustments

    Payments under the Annual Incentive Plan are contingent primarily on the achievement of pre-established performance goals relating to objective financial metrics established for each participating named executive officer by the Compensation Committee, and secondarily upon the results of a subjective evaluation of each individual executive’s performance. Each of the elements has an assigned weight and each of the objective financial criteria has a specific target or goal for the year. In the event that we (or the individual participant) do not meet the specified goal or target for a particular metric, then no compensation will be paid with respect to that objective portion of the Annual Incentive Plan. The Compensation Committee established a threshold payout of 50% of target opportunity upon attaining a threshold level of the objective metrics, a target payout of 100% upon attaining 100% of the target level of the objective metrics, and a maximum payout of 150% of target opportunity upon attaining at or greater than a maximum level of the objective metrics. Performance falling below threshold results in no payout; for performance falling within each of the percentile ranges, payouts are made on an interpolated basis. Payout opportunity on the subjective elements also ranged from 0% to 150%. The annual incentive program for certain of our executive officers, including Mr. Shaffer and Mr. Wenick, include additional performance goals measured by objective performance objectives within their specific areas of responsibility and oversight. Payout opportunities on such line of business metrics also typically range from 0% to 150%, although the payout on one of Mr. Shaffer’s additional objectives ranged from 0% to 200%. In establishing the Annual Incentive Plan’s objective metrics and targets for 2023, the Compensation Committee utilized the Company’s budgeting model to set the performance at levels that were determined to be achievable with strong management performance. All named executive officers were allocated certain weightings of three core corporate financial measures (as adjusted): earnings per share (“EPS”), return on average assets (“ROA”), and pre-tax pre-provision net income. The latter metric was first used in 2023, and replaced the prior metric of efficiency ratio. The Compensation Committee determined that the prior near-term focus on improving the Company’s efficiency ratio had served its purpose, and including an income-based metric served a more strategic near-term purpose. As noted in the Executive Summary, achievement on this financial metric fell below our expectations, but the resulting lack of any payout on the metric evidences the strong and direct linkage of our compensation programs with our objective financial performance. The foregoing were the sole objective financial performance criteria allocated to Messrs. Helmick, Adair, and Matuszak. Mr. Shaffer and Mr. Wenick had additional objective metrics based on specific areas of responsibility and oversight. Finally, in addition to the objective performance metrics, a subjective metric was included for each of the named executive officers, weighted at 20% for Messrs. Helmick, Adair, and Matuszak, 15% for Mr. Shaffer, and 25% for Mr. Wenick. The subjective factor is evaluated based on a scorecard assessment for each individual’s performance. Mr. Shaffer’s and Mr. Wenick’s additional internally-measured performance metrics and targets based on areas of responsibility include information that is not otherwise publicly available. Because disclosure of such information could result in competitive harm to Farmers, the metrics and related performance results are not specifically disclosed but the payouts with respect to those measures are set forth below. The following tables set forth the applicable objective performance metrics, weightings, targets and percentage payouts on the corporate level objective metrics under the Annual Incentive Plan in 2023 for each of our named executive officers: Kevin Helmick, Troy Adair, and Myke Matuszak

  32. 2023 Base Salaries and Adjustments

    | Metric | Weight | Threshold | Target | Maximum | 2022 Actual | 2023 Actual | Payout % | | EPS | 30% | $1.63 | $1.75 | $1.95 | $1.89 | $1.65 | 60% | | ROA | 30% | 1.19% | 1.28% | 1.37% | 1.54% | 1.23% | 72% | | Net Income | 20% | $83.5 | $88.6 | $93.7 | N/A | $77.9 | 0% | | (in millions) | | | | | | | |

  33. 2023 Base Salaries and Adjustments

    | Metrics | Weight | Threshold | Target | Maximum | Actual | Payout % | | EPS | 20% | $1.63 | $1.75 | $1.95 | $1.65 | 60% | | ROA | 10% | 1.19% | 1.28 | 1.37% | 1.23% | 72% | | Net Income (in millions) | 20% | $83.5 | $88.6 | $93.7 | $77.9 | 0% | | Area of Responsibility Metric | 20% | | | | | 120% | | Area of Responsibility Metric | 15% | | | | | 160% |

  34. 2023 Base Salaries and Adjustments

    | Metrics | Weight | Threshold | Target | Maximum | Actual | Payout % | | EPS | 15% | $1.63 | $1.75 | $1.95 | $1.65 | 60% | | ROA | 15% | 1.19% | 1.28% | 1.37% | 1.23% | 72% | | Net Income (in millions) | 15% | $83.5 | $88.6 | $93.7 | $77.9 | 0% | | Area of Responsibility Metric | 30% | | | | | 101% |

  35. 2023 Base Salaries and Adjustments

    In addition to the objective performance metrics described above, the Compensation Committee included a subjective metric for each of the named executive officers, weighted at 20% of the total bonus opportunity for Messrs. Helmick, Adair, and Matuszak with payout opportunity ranging from 0% to 150%. The weighting of the subjective metric for Mr. Shaffer was 15% and for Mr. Wenick was 25% of their respective total bonus opportunity, with potential payouts ranging from 0% to 150%. Payouts under the subjective metric were based on evaluations of the individual’s overall job performance during 2023, using an extensive performance review scorecard for each executive. For each named executive officer other than Mr. Helmick, the scorecards were completed by Mr. Helmick and he provided his evaluations to the Compensation Committee and the payouts for subjective portion of the executive’s bonus for 2023. For Mr. Helmick, each member of the Board of Directors provided input on Mr. Helmick’s performance under goals established in five areas of core competencies: Business Planning, Change/Crisis Management, Communications, Self-Management and Development, and Managing Executive Performance and Development. These evaluations were considered by the Compensation Committee in reaching its determination with respect to the payout on the subjective element of Mr. Helmick’s 2023 annual bonus. Based upon such reviews and recommendations, the Compensation Committee approved the following percentage payouts with respect to the subjective element of the total bonus opportunity: (i) Mr. Helmick, 125%; (ii) Mr. Adair, 120%; (iii) Mr. Matuszak, 125%; (iv) Mr. Shaffer, 125%; and (vi) Mr. Wenick, 120%. In addition to the amounts earned in 2023 under our Annual Incentive Plan, Mr. Matuszak received a one-time bonus of $75,000 in 2023 in connection with his initial hiring to partially replace compensation opportunities from a prior employer that Mr. Matuszak forfeited upon joining Farmers. The bonus is subject to forfeiture in the event Mr. Matuszak’s employment terminates within 18 months of his hire date of December 1, 2022. The Compensation Committee also continued to include a circuit breaker in the 2023 Annual Incentive Plan, based on Farmers’ “Texas ratio” for the year. The Texas ratio is determined by dividing the amount of Farmers Bank’s non-performing loans, other real estate owned, and loans delinquent for more than 90 days, by Farmers Bank’s tangible capital equity plus its loan loss reserves. If this ratio exceeds 15% for the year, no bonuses are payable under the Annual Incentive Plan. Farmers’ Texas ratio for 2023 was approximately 6.16%, well below this circuit breaker level. The Compensation Committee believes that the use of a circuit breaker in our annual bonus program helps maintain minimum levels of safety and soundness of our institution in the context of providing appropriate near-term incentives for achieving superior financial performance objectives. As a result of the performance of Farmers with respect to the above-described objective metrics and each named executive officer’s individual performance evaluations, the Compensation Committee awarded the following payouts with respect to 2023 performance under the Annual Incentive Plan:

  36. 2023 Base Salaries and Adjustments

    | Named Executive Officer | Amount Earned under Annual Incentive Plan | Payout as a Percentage of Target Opportunity | | Kevin Helmick | $183,822 | 57% | | Troy Adair | $64,206 | 56% | | Myke Matuszak | $67,643 | 57% | | Timothy Shaffer | $90,271 | 86% | | Mark Wenick | $84,182 | 80% |

  37. 2023 Base Salaries and Adjustments

    Long-Term Incentive Plans Under our LTI Cash Program, executive officers and certain other employees are eligible to receive awards for possible long-term cash incentive payments based on the achievement of prescribed corporate and/or individual performance metrics. The purpose of the LTI Cash Program is to foster and promote Farmers’ long-term financial success and value by motivating performance through long-term incentive compensation, pending review and approval by the Compensation Committee. The LTI Cash Program is also intended to attract and retain the services of talented individuals and to motivate participants to achieve performance objectives that promote sound and financially healthy growth. The LTI Cash Program may continue until terminated by the Board of Directors. Our 2017 Equity Incentive Plan and our 2022 Equity Incentive Plan were each adopted by our Board of Directors and shareholders to promote Farmers’ long-term financial success and increase shareholder value by motivating performance through equity-based long-term incentive compensation. The Equity Incentive Plans are also intended to encourage participants to acquire ownership interests in the Company, attract and retain talented executives and directors, and enable participants to participate in the Company’s long-term growth and financial success. Results of Long-Term Incentive Awards Granted in 2021 In 2021, the Compensation Committee established target long-term award opportunities for each eligible named executive officer, expressed as a percentage of a participant’s base salary, as follows:

  38. 2023 Base Salaries and Adjustments

    | • | 25% in service-based equity awards, subject to three-year cliff vesting, and |

  39. 2023 Base Salaries and Adjustments

    | • | 50% of all long-term incentive awards were equity-based performance awards subject to vesting determined by our average annual ROE compared to ROE performance of our peer group of banking companies over the Performance Period, and |

  40. 2023 Base Salaries and Adjustments

    | • | 25% of all long-term incentive awards were cash-based performance awards subject to vesting determined by our TSR compared to peer group performance over the Performance Period. |

  41. 2023 Base Salaries and Adjustments

    | Named Executive Officer | LTI Program Target Opportunity (% of base salary) | | Kevin Helmick | 55% | | Troy Adair | 40% | | Myke Matuszak(1) | N/A | | Timothy Shaffer | 35% | | Mark Wenick | 35% |

  42. 2023 Base Salaries and Adjustments

    The following table indicates the target performance level and the actual results of our relative TSR and relative average annual ROE performance, as adjusted, for the Performance Period, with the percentage payouts for the LTI Cash Program and 2017 Equity Incentive Plan awards we granted in 2021. For performance falling below threshold, no award payout or vesting was to occur. Percentage payout opportunities for the cash-based awards under the LTI Cash Program ranged from 20% vesting for performing at the threshold 25th percentile of peer group, 100% for performing at the target 50th percentile, and 200% for performing at or above the 75th percentile. For performance falling within each of the percentile ranges, the payout was determined on an interpolated basis. The share-based awards under the 2017 Equity Incentive Plan were granted at the maximum payout opportunity of 200%, so the percentage payout opportunities ranged from 10% vesting for performing at the threshold level of the 25th percentile of peer group, 50% vesting for performing at the target 50th percentile, and 100% vesting for performing at or above the 75th percentile (equivalent to 200%, or maximum, of target opportunity). The following table summarizes the percentage payouts for our 2021 long-term performance-based awards based on Farmers’ performance on the two metrics relative to its peer group. Payout amounts under the LTI Cash Program based on relative TSR for each named executive officer are included in “Non-Equity Incentive Plan Compensation,” column (g), of the Summary Compensation Table but no payouts were made with respect to the Performance Period ended 2023. Vesting amounts for the 2017 Equity Incentive Plan awards based on relative average annual ROE are included in the amounts reported in the 2023 Option Exercises and Stock Vested table, column (e).

  43. Vesting Summary of 2021-2023 Long-Term Performance Awards

    Vesting Summary of 2021-2023 Long-Term Performance Awards

  44. Vesting Summary of 2021-2023 Long-Term Performance Awards

    | Performance Metric | Target(1) | Actual | Rank(2) | Payout % of Target | | Relative Average ROE | 13.28% | 17.16% | 100(th) | 200.0% | | Relative TSR | 131.12% | 123.21% | 33(rd) | 46.7% |

  45. Vesting Summary of 2021-2023 Long-Term Performance Awards

    | (1) Median performance (50th percentile) of the peer group companies for the Performance Period. |

  46. Vesting Summary of 2021-2023 Long-Term Performance Awards

    | (2) Presented as a percentile rank relative to the peer group companies for the Performance Period. |

  47. Vesting Summary of 2021-2023 Long-Term Performance Awards

    Long-Term Incentive Awards Granted in 2023 In 2023, the Compensation Committee established the long-term incentive compensation target opportunities for each eligible named executive officer, expressed as a percentage of base as follows:

  48. Vesting Summary of 2021-2023 Long-Term Performance Awards

    | Named Executive Officer | 2023-2025 LTI Program Target Opportunity (% of base salary) | | Kevin Helmick | 55% | | Troy Adair | 40% | | Myke Matuszak | 35% | | Timothy Shaffer | 35% | | Mark Wenick | 35% |

  49. Vesting Summary of 2021-2023 Long-Term Performance Awards

    In connection with Mr. Matuszak’s initial hire, he received a one-time award of 5,000 shares of restricted stock under the 2017 Equity Incentive Plan which vests on the second anniversary of the award grant date conditioned on continued employment though such anniversary, to partially replace compensation opportunities from a prior employer that Mr. Matuszak forfeited upon joining Farmers. In conjunction with establishing the target long-term incentive opportunity for our executive officers in 2023, the Compensation Committee, determined to maintain an allocation of 25% of our total long-term compensation opportunity to service-based awards, subject to three-year cliff vesting. We continued to allocate the remaining 75% of the target long-term incentive opportunity to performance-based awards, for which we continued to use relative TSR and relative average ROE as the performance metrics, with the same mix of cash-based and equity-based long-term performance awards as follows: (i) 25% in cash-based awards under our LTI Cash Program subject to vesting based on relative TSR compared to our peer group over a performance period ending December 31, 2024, and (ii) 50% in equity-based grants under our 2022 Equity Incentive Plan subject to vesting based on relative average ROE compared to our peer group over a performance period ending December 31, 2024. The following table indicates potential payouts at the threshold, target and maximum levels for our 2023 long-term incentive awards under both the LTI Cash Program and the 2022 Equity Incentive Plan, with relative performance compared to our 2023 Peer Group, consistent with grants of long-term incentive awards in recent years. The maximum award opportunity was established at 200% of the target opportunity.

  50. Vesting Summary of 2021-2023 Long-Term Performance Awards

    | Vesting Levels | Relative Performance of TSR and Average ROE to Peer Group Companies | Vesting Percent of Target LTI Opportunity | | Below threshold | < Peer 25th Percentile | 0% | | Threshold | = Peer 25th Percentile | 20% | | Target | = Peer 50th Percentile | 100% | | Maximum | ≥ Peer 75th Percentile | 200% |

  51. Vesting Summary of 2021-2023 Long-Term Performance Awards

    For performance falling within each of the percentile ranges, payouts or vesting will occur on an interpolated basis. The amounts of the threshold, target and maximum award payouts or vesting that may be received by each of our named executive officers upon completion of the 2023-2024 Performance Period with regard to long-term incentive awards granted in 2023 under the LTI Cash Program and the 2022 Equity Incentive Plan is described in detail in the 2023 Grants of Plan Based Awards table of this proxy statement. Clawback Policy Farmers has adopted a clawback policy as part of its Incentive Compensation Guidelines. The Company maintains a Clawback Policy, as required by Rule 5608 of the Nasdaq Stock Market LLC listing rules, that provides for the recovery of “erroneously awarded” incentive based compensation if the Company is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirements under the federal securities laws. The Clawback Policy is administered by the Compensation Committee and applies to current and former executive officers as described in the Clawback Policy. 401(k) Plan and Company Contributions All of our employees who have completed at least one year of service and meet certain other eligibility requirements are eligible to participate in our 401(k) Profit Sharing Retirement Savings Plan (the “401(k) Plan”). Under the terms of the 401(k) Plan, employees may voluntarily defer a portion of their annual compensation, subject to applicable federal restrictions and deferral limitations, and Farmers Bank matches a percentage of each participant’s voluntary contributions, up to 6% of gross wages. In addition, at the discretion of the Board of Directors, Farmers Bank may make an additional profit sharing contribution to the 401(k) Plan. During 2023, Farmers Bank provided 401(k) Plan matching contributions of 50% for each of the named executive officers (subject to a maximum of 3% of gross wages), but no additional profit sharing contributions were made. Nonqualified Deferred Compensation Plan Our Nonqualified Deferred Compensation Plan (the “Nonqualified Plan”) is an unfunded nonqualified retirement plan in which eligible executive officers may voluntarily defer a greater portion of their compensation than permitted by applicable federal restrictions and deferral limitations applicable to our 401(k) Plan. Participating officers are at all times 100% vested in their voluntary deferrals. The Company may also provide matching or discretionary credits to the accounts of eligible officers, as determined by the Company in its sole discretion. The Company currently credits matching contributions equal to 50% of each participant’s voluntary deferrals to the Nonqualified Plan, up to 6% of gross wages (or a 3% match). Any matching or discretionary credits under the Nonqualified Plan vest and become non-forfeitable in accordance with a specified formula that provides for partial vesting starting after completion of two years and full vesting after six years. Upon a Change-in-Control (as defined in the Nonqualified Plan), participants’ benefits under the Nonqualified Plan become fully vested and non-forfeitable. Benefits under the Nonqualified Plan represent unsecured general obligations of the Company to pay participating officers at some time in the future. The Nonqualified Plan also allows discretionary additional annual contributions to be made by the Company for the benefit of participating officers, based on a percentage of each participant’s total eligible compensation, as determined annually in the discretion of the Compensation Committee. With respect to calendar year 2023, the Compensation Committee approved a discretionary contribution of 3.0%, representing a total amount of approximately $119,610 with respect to ten participating officers. The Compensation Committee approved a 2.0% discretionary contribution with respect to 2022. The amounts accrued pursuant to the Nonqualified Plan for the benefit of our named executive officers for calendar year 2023 are disclosed in the Summary Compensation Table. The Compensation Committee believes that maintaining this Nonqualified Plan helps to maintain the competitiveness of our entire executive retirement benefits. Amounts payable to participating officers under the Nonqualified Plan will be distributed in accordance with the terms of the Nonqualified Plan and elections made by the participating officers. Benefits generally will be paid in a single lump sum unless the participating officer has elected to receive annual installments for a period of up to ten years. The benefits will be paid upon the earliest of a participating officer’s separation from service, death or disability unless the participating officer has elected to receive payments as of a specified date (including the earlier of that date or the occurrence of a regular distribution event). The Nonqualified Plan is subject to requirements affecting deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) and is being administered in compliance with the applicable regulations under Section 409A. Perquisites and Other Compensation Executive officers also participate in broad-based employee benefit plans, such as medical, dental, supplemental disability, retiree health insurance and term life insurance programs. Except for matching contributions in connection with our Nonqualified Plan as described above and country club memberships provided by Farmers to certain of the named executive officers for customer relationship development purposes, executive officers received no perquisites or personal benefits in 2023 that are not available to all employees. The amounts of the benefits received are included in the “All Other Compensation” column (i) of the Summary Compensation Table.

  52. Other Elements of Our Executive Compensation Programs

    Other Elements of Our Executive Compensation Programs Employment Agreements, Separation Policy and Change in Control Arrangements The Compensation Committee carefully considers the use and conditions of any employment related agreements. Although employment agreements that contain severance and change in control arrangements may be appropriate to attract prospective executives who forego significant other employment opportunities, we first determined in 2013 to adopt an Executive Separation Policy that applies to our executive officers and certain senior officers in lieu of employment agreements. In connection with that implementation, we entered into change in control agreements with each of our executive officers (“Change in Control Agreements”). The material provisions of the Executive Separation Policy and the Change in Control Agreements are discussed under the caption “EXECUTIVE COMPENSATION AND OTHER INFORMATION – Employment Agreements, Change in Control Agreements, Executive Separation Policy”. Overall, the Compensation Committee believes that the implementation of the Executive Separation Policy and Change in Control Agreements is appropriate to help ensure that Farmers will have the continued dedication, undivided loyalty and objective advice from its key executives, even in the event of a potential transaction that could result in a change in control of Farmers. The Separation Policy offers certain protections in the event of certain terminations of employment, while the Change in Control Agreements provide certain protections in the event of a change in control event, but only if the executive’s employment is terminated as a result of (or within a specified period after) a change in control (i.e., a double trigger). The Compensation Committee does not believe that executives should receive compensation benefits merely as a result of a change in control; rather, it believes that our Change in Control Agreements provide our executive officers with adequate protection to help ensure that change in control offers will be evaluated by our executive officers in the best interests of Farmers and our shareholders without regard to concerns that a transaction could eliminate his or her job without appropriate dispensation. The Compensation Committee recognizes that these agreements may also tend to discourage a takeover attempt as a change in control could trigger increased compensation expense as part of the transaction.

  53. Director Compensation

    Director Compensation The Compensation Committee is also responsible for recommending to the Board of Directors compensation for our non-employee directors. Generally, director compensation is structured in a fashion to attract and retain high quality individuals to serve on the Board of Directors, to compensate such individuals for the time and energy expended in providing us their expertise, considering the size, nature and location of Farmers as a bank holding company competing in our markets. On an annual basis, the Compensation Committee requests that its compensation consultant evaluate our current non-employee director compensation levels relative to our peers. Generally, it is the overall goal of the Compensation Committee to position non-employee director compensation at a median market level. For calendar year 2023, based on the peer benchmarking annual review described above, the Compensation Committee recommended and the independent members of the Board of Directors approved the following compensation levels for non-employee directors: (a) general annual retainer fee of $80,000, payable $62,500 in cash and $17,500 in restricted stock units to be awarded on the day of the annual meeting of shareholders subject to vesting on the one year anniversary of the grant date, and (b) the following retainers for directors with additional duties: (i) $37,500 for the independent chair of the Board, (ii) $10,000 for the chair of the Audit Committee, and (iii) $7,500 for each other chair of a Board committee. All director compensation amounts for 2023 are reflected in the Director Compensation table.

  54. Summary Compensation Table

    Summary Compensation Table

  55. Summary Compensation Table

    | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards(1) ($) | Stock Options ($) | Non-Equity Incentive Plan Compensation(2) ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | Kevin J. Helmick | 2023 | $610,722 | — | $256,324 | — | $213,332 | | $78,936(3) | $1,159,314 | | President and Chief | 2022 | $567,788 | — | $575,207 | — | $256,678 | | $71,465 | $1,471,138 | | Executive Officer | 2021 | $469,582 | $369,750 | $199,768 | — | $418,176 | | $70,746 | $1,528,022 | | Troy Adair | 2023 | $324,062 | — | $94,688 | — | $64,206 | | $32,166(4) | $515,122 | | Senior Executive Vice President, Chief Financial Officer | 2022 | $285,929 | — | $192,701 | — | $98,784 | | $19,991 | $597,405 | | | 2021 | $122,357 | $120,000 | $154,749 | — | $73,500 | | $8,359 | $478,965 | | Myke Matuszak | 2023 | $335,640 | $75,000(5) | $158,322 | — | $67,643 | | $25,769(6) | $662,374 | | Senior Executive Vice President, Chief Operating Officer | | | | | | | | | | | Timothy F. Shaffer | 2023 | $292,658 | — | $72,343 | — | $97,714 | | $31,778(7) | $494,493 | | Senior Executive Vice President, Chief Credit Officer | 2021 | $212,375 | $84,375 | $60,319 | — | $136,928 | | $29,012 | $569,872 | | Mark Wenick | 2023 | $298,581 | — | $76,294 | — | $84,182 | | $34,811(8) | $493,868 | | Senior Executive Vice President, Chief Wealth Management Officer | 2022 | $249,002 | — | $168,163 | — | $114,238 | | $30,606 | $562,009 | | | 2021 | $228,248 | $98,598 | $68,858 | — | $170,533 | | $28,906 | $595,143 |

  56. Summary Compensation Table

    | (1) Amounts shown reflect the aggregate grant date fair value computed in accordance with FASB ASC Topic 718 for equity awards granted during 2023 under our 2022 Equity Incentive Plan. As further reflected in the 2023 Grants of Plan Based Awards table, (i) the amounts reported for service-based equity awards granted during 2023 were determined using closing price of a Common Share on the dates of grant of $14.16 for February 22, 2023, and (ii) the amounts reported for performance-based equity awards granted during 2023 were determined using the closing price of a Common Share on the date of grant of February 22, 2023 of $14.16, and the target vesting levels assuming our average ROE performance equals the 50th percentile (i.e., target vesting level) of the average of a group of peer companies over a three-year period ending on December 31, 2025. The maximum value of the performance-based stock awards granted in 2023 to each named executive officer, assuming that the highest level of performance conditions will be achieved and using the closing price of a Common Share on the date of grant of $14.16, is as follows: Mr. Helmick, $341,741; Mr. Adair, $126,270; Mr. Matuszak, $114,693; Mr. Shaffer, $96,457; and Mr. Wenick, $101,717. Other assumptions used in the calculation of these amounts are also included in Note 11 “Stock Based Compensation” to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. All service-based restricted stock and performance-based equity awards are subject to vesting as described under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans” in this proxy statement. |

  57. Summary Compensation Table

    | (2) The non-equity incentive plan compensation required to be disclosed in this column includes (i) amounts earned under our Annual Incentive Plan as a result of achieving the goals specified for each designated year, as described for 2023 in the table included below under “Executive Compensation and Other Information – Annual Incentive Plan”, plus (ii) the following amounts earned in 2023, 2022, and 2021 with respect to cash-based long-term incentive awards granted in 2021, 2020, and 2019, respectively, as applicable, under our LTI Cash Program: Mr. Helmick, $30,415, $29,150, and $122,376; Mr. Adair, $11,200 (earned in 2023 with respect to his first such award granted in 2021); Mr. Shaffer, $9,188 (earned in 2023) and $26,678 (earned in 2021); and Mr. Wenick, $10,484 (earned in 2023) and $43,748 (earned in 2021). |

  58. Summary Compensation Table

    | (3) Amount includes: (i) $9,900 in matching contributions by the Company into Mr. Helmick’s 401(k) Plan account, (ii) $1,464 in group term life insurance expense, (iii) $15,032 in country club dues, and (iv) $50,699 in Nonqualified Deferred Compensation Plan account matching contributions and discretionary contributions. |

  59. Summary Compensation Table

    | (4) Amount includes: (i) $9,900 in matching contributions by the Company into Mr. Adair’s 401(k) Plan account, (ii) $1,428 in group term life insurance expense, (iii) $1,905 in country club dues, and (iv) $17,095 in Nonqualified Deferred Compensation Plan account matching contributions and discretionary contributions. |

  60. Summary Compensation Table

    | (5) Mr. Matuszak received a one-time bonus of $75,000 in connection with his initial hiring to partially replace compensation opportunities from a prior employer that Mr. Matuszak forfeited upon joining Farmers. The bonus is subject to forfeiture in the event Mr. Matuszak’s employment terminates within 18 months of his hire date of December 1, 2022. |

  61. Summary Compensation Table

    | (6) Amount includes: (i) $9,900 in matching contributions by the Company into Mr. Matuszak’s 401(k) Plan account, (ii) $1,445 in group term life insurance expense, and (iii) $12,584 in Nonqualified Deferred Compensation Plan account matching contributions and discretionary contributions. |

  62. Summary Compensation Table

    | (7) Amount includes: (i) $9,900 in matching contributions by the Company into Mr. Shaffer’s 401(k) Plan account, (ii) $1,286 in group term life insurance expense, (iii) $2,682 in country club dues, and (iv) $15,084 in Nonqualified Deferred Compensation Plan account matching contributions and discretionary contributions. |

  63. Summary Compensation Table

    | (8) Amount includes: (i) $9,900 in matching contributions by the Company into Mr. Wenick’s 401(k) Plan account, (ii) $1,318 in group term life insurance expense, (iii) $7,285 in country club dues, and (iv) $14,479 in Nonqualified Deferred Compensation Plan account matching contributions and discretionary contributions. |

  64. 2023 Grants of Plan Based Awards

    2023 Grants of Plan Based Awards

  65. 2023 Grants of Plan Based Awards

    | | | | Estimated Future Payouts under Non-Equity Incentive Plan Awards | | | Estimated Future Payouts under Equity Incentive Plan Awards | | | | | | (a) | (b) | | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | | Name | Grant Date | Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | All Other Stock Awards: Number of Shares of Stock (#) | Grant Date Fair Value of Stock and Option Awards ($) | | Kevin J. Helmick | 2/22/2023(1) | 2/21/2023 | $160,000 | $320,000 | $480,000 | | | | | | | | 2/22/2023(2) | 2/21/2023 | $17,051 | $85,254 | $170,508 | | | | | | | | 2/22/2023(3) | 2/21/2023 | | | | 2,413 | 12,067 | 24,134 | | $170,869 | | | 2/22/2023(4) | 2/21/2023 | | | | | | | 6,034 | $85,441 | | Troy Adair | 2/22/2023(1) | 2/21/2023 | $56,875 | $113,750 | $170,625 | | | | | | | | 2/22/2023(2) | 2/21/2023 | $6,300 | $31,501 | $63,002 | | | | | | | | 2/22/2023(3) | 2/21/2023 | | | | 892 | 4,459 | 8,918 | | $63,139 | | | 2/22/2023(4) | 2/21/2023 | | | | | | | 2,229 | $31,563 | | Myke Matuszak | 2/22/2023(1) | 2/21/2023 | $58,877 | $117,754 | $176,631 | | | | | | | | 2/22/2023(2) | 2/21/2023 | $5,723 | $28,613 | $57,226 | | | | | | | | 2/22/2023(3) | 2/21/2023 | | | | 810 | 4,050 | 8,100 | | $57,348 | | | 2/22/2023(4) | 2/21/2023 | | | | | | | 2,025 | $28,674 | | | 1/3/2023(5) | 1/3/2023 | | | | | | | 5,000 | $72,300 | | Timothy Shaffer | 2/22/2023(1) | 2/21/2023 | $52,500 | $105,000 | $157,500 | | | | | | | | 2/22/2023(2) | 2/21/2023 | $4,813 | $24,063 | $48,126 | | | | | | | | 2/22/2023(3) | 2/21/2023 | | | | 681 | 3,406 | 6,812 | | $48,229 | | | 2/22/2023(4) | 2/21/2023 | | | | | | | 1,703 | $24,114 | | Mark Wenick | 2/22/2023(1) | 2/21/2023 | $52,500 | $105,000 | $157,500 | | | | | | | | 2/22/2023(2) | 2/21/2023 | $5,075 | $25,375 | $50,750 | | | | | | | | 2/22/2023(3) | 2/21/2023 | | | | 718 | 3,592 | 7,184 | | $50,863 | | | 2/22/2023(4) | 2/21/2023 | | | | | | | 1,796 | $25,431 |

  66. 2023 Grants of Plan Based Awards

    | (1) Potential levels of bonus payments under the Annual Incentive Plan with respect to 2023 performance. Further discussion of the Annual Incentive Plan and the potential payouts to participants in that plan is contained under “2023 Named Executive Officers Compensation – Annual Incentive Plan” under the Compensation Discussion and Analysis portion of this proxy statement. The amounts actually earned and paid with respect to 2023 are included in the “Non-Equity Incentive Plan Compensation” column (g) of the Summary Compensation Table immediately preceding this table. |

  67. 2023 Grants of Plan Based Awards

    | (2) Performance-based cash awards under the LTI Cash Program with payouts on the third anniversary of the award grant date determined by our TSR performance relative to the average of a group of peer companies over a three-year period ending on December 31, 2025, at a 25% weighting of each executive officer’s total long-term incentive compensation opportunity. Further discussion of the LTI Cash Program and the potential award payouts to participants in that plan is contained under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans” in the Compensation Discussion and Analysis portion of this proxy statement. |

  68. 2023 Grants of Plan Based Awards

    | (3) Performance-based equity awards granted under the 2023 Equity Incentive Plan with vesting on the third anniversary of the award grant date determined by our average ROE performance relative to the average of a group of peer companies over a three-year period ending on December 31, 2025, at a 50% weighting of each executive officer’s total long-term incentive compensation target opportunity. The grant date fair value of these performance shares was computed using the target level award in column (g) and a grant date fair value on the date of grant of $14.16 (although the number of shares granted at the target levels of value for these awards was determined using the average closing price of our Common Shares for the 30-day period preceding the grant date, which was $14.13 per share). Further discussion of our 2017 Equity Incentive Plan and 2022 Equity Incentive Plan and the terms and conditions of vesting of performance-based awards issued to participants in those plans is contained under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans” in the Compensation Discussion and Analysis portion of this proxy statement. |

  69. 2023 Grants of Plan Based Awards

    | (4) Service-based equity awards of restricted stock granted under the 2022 Equity Incentive Plan which vest on the third anniversary of the award grant date conditioned on continued employment through such anniversary. The grant date fair value of such awards was calculated using the closing price of our Common Shares on the date of |

  70. 2023 Grants of Plan Based Awards

    | grant of $14.16 per share (although the number of shares granted at the target levels of value for these awards was determined using the average closing price of our Common Shares for the 30-calendar day period preceding the grant date, which was $14.13 per share). Further discussion of our 2017 Equity Incentive Plan and 2022 Equity Incentive Plan and the terms and conditions of vesting of performance-based awards issued to participants in those plans is contained under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans” in the Compensation Discussion and Analysis portion of this proxy statement. |

  71. 2023 Grants of Plan Based Awards

    | (5) In connection with Mr. Matuszak’s appointment, he received a one-time award of 5,000 shares of restricted stock under the 2022 Equity Incentive Plan which vests on the second anniversary of the award grant date conditioned on continued employment though such anniversary. The grant date fair value of such award was calculated using the closing price of our Common Shares on the date of grant of $14.46 per share. |

  72. 2023 Outstanding Equity Awards at Fiscal Year-End

    2023 Outstanding Equity Awards at Fiscal Year-End

  73. 2023 Outstanding Equity Awards at Fiscal Year-End

    | | Option Awards | | | | | Stock Awards | | | | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | | Name | Number of Securities Underlying Unexercised Options (Exercisable) (#) | Number of Securities Underlying Unexercised Options (Unexercisable) (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock that Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested(1) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(2) (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(1) ($) | | Kevin J. Helmick | | | | | | 35,822(3) | $517,628 | 24,134(4) | $348,736 | | | | | | | | | | 15,398(5) | $222,501 | | | | | | | | | | 18,902(6) | $273,134 | | Troy Adair | | | | | | 11,976(7) | $173,053 | 8,917(4) | $128,851 | | | | | | | | | | 5,451(5) | $78,767 | | | | | | | | | | 5,996(6) | $86,642 | | Myke Matuszak | | | | | | 7,025(8) | $101,511 | 8,100(4) | $117,045 | | Timothy Shaffer | | | | | | 9,089(9) | $131,336 | 6,812(4) | $98,433 | | | | | | | | | | 4,472(5) | $64,620 | | | | | | | | | | 5,710(6) | $82,510 | | Mark Wenick | | | | | | 10,388(10) | $150,107 | 7,183(4) | $103,794 | | | | | | | | | | 5,226(5) | $75,516 | | | | | | | | | | 6,516(6) | $94,142 |

  74. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (1) Market value computed using $14.45, the closing price of our Common Shares on December 29, 2023. |

  75. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (2) Unearned equity awards are presented based on achievement of maximum performance goals and maximum number of shares issuable with respect to vesting thereof. |

  76. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (3) Awards of service-based restricted shares granted under our 2017 Equity Incentive Plan and our 2022 Equity Incentive Plan which are subject to vesting on the third anniversary of the date of grant, conditioned on continued employment, the vesting of which would occur as follows: (i) 4,726 on February 22, 2024; (ii) 3,849 on February 23, 2025; (iii) 21,213 on February 25, 2025; and (iv) 6,034 on February 22, 2026. |

  77. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (4) Performance-based awards granted during 2023 under our 2022 Equity Incentive Plan that are to vest, if at all, on February 22, 2026, based upon the performance of our average ROE relative to the average of a peer group of similar companies during the Performance Period ending December 31, 2025, as described in greater detail under “2023 Named Executive Officers Compensation – Long-Term Incentive Compensation Plans” in the Compensation Discussion and Analysis portion of this proxy statement. Any performance awards that do not vest on February 22, 2026 will be forfeited. |

  78. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (5) Performance-based awards granted during 2022 under our 2017 Equity Incentive Plan that are to vest, if at all, on February 23, 2025, based upon the performance of our average ROE relative to the average of a peer group of similar companies during the Performance Period ending December 31, 2024. No awards will vest if our performance falls below the 25th percentile or threshold level, 10% will vest if performance is at the 25th percentile, 50% will vest if performance is at the 50th percentile, and 100% will vest if performance is at the 85th percentile or above. For performance falling within each of these percentile ranges, payouts and vesting will occur on an interpolated basis. Any performance awards that do not vest on February 23, 2025 will be forfeited. |

  79. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (6) Performance-based awards granted during 2021 under our 2017 Equity Incentive Plan that are to vest, if at all, on February 22, 2024, based upon the performance of our average ROE relative to the average of a peer group of similar companies during the Performance Period ending December 31, 2023. No awards will vest if our performance falls below the 25th percentile or threshold level, 10% will vest if performance is at the 25th percentile, 50% will vest if performance is at the 50th percentile, and 100% will vest if performance is at the 85th percentile or above. For performance falling within each of these percentile ranges, payouts and vesting will occur on an interpolated basis. Any performance awards that do not vest on February 22, 2024 will be forfeited. |

  80. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (7) Awards of service-based restricted shares subject to vesting, conditioned on continued employment, as follows: (i) 1,499 on July 14, 2024; (ii) 1,363 on February 23, 2025; (iii) 6,885 on February 25, 2025; and (iv) 2,229 on February 22, 2026. |

  81. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (8) Awards of service-based restricted shares subject to vesting conditioned on continued employment as follows: (i) 5,000 on January 1, 2025; and (ii) 2,025 on February 22, 2026. |

  82. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (9) Awards of service-based restricted shares subject to vesting conditioned on continued employment as follows: (i) 1,427 on February 22, 2024; (ii) 1,118 on February 23, 2025; (iii) 4,841 on February 25, 2025; and (iv) 1,703 on February 22, 2026. |

  83. 2023 Outstanding Equity Awards at Fiscal Year-End

    | (10) Awards of service-based restricted shares subject to vesting on the third anniversary of the date of grant, conditioned on continued employment, the vesting of which would occur as follows: (i) 1,629 on February 22, 2024; (ii) 1,306 on February 23, 2025; (iii) 5,657 on February 25, 2025; and (iv) 1,796 on February 22, 2026. |

  84. 2023 Option Exercises and Stock Vested

    2023 Option Exercises and Stock Vested

  85. 2023 Option Exercises and Stock Vested

    | | Option Awards | | Stock Awards | | | (a) | (b) | (c) | (d) | (e) | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | | Kevin J. Helmick | | | 19,766(1) | $283,642(2) | | Troy Adair | | | 5,000(3) | $63,400(4) | | Myke Matuszak | | | — | — | | Timothy Shaffer | | | 4,985(5) | $71,535(2) | | Mark Wenick | | | — | — |

  86. 2023 Option Exercises and Stock Vested

    | (1) Amounts represent number of shares which vested (i) on February 18, 2023 from an award granted during 2020 under our 2017 Equity Incentive Plan based on the performance of Farmers average ROE relative to the average ROE of our peer group of similar companies during the Performance Period ended on December 31, 2022, and (ii) on February 18, 2023 from an award of service-based restricted shares granted during 2020 under our 2017 Equity Incentive Plan conditioned on continued employment through that date. |

  87. 2023 Option Exercises and Stock Vested

    | (2) Amount represents value realized upon vesting at the vesting date closing price of our Common Shares of $14.35 on the vesting date of February 17, 2023. |

  88. 2023 Option Exercises and Stock Vested

    | (3) Amounts represent number of shares which vested on June 21, 2023 from awards of service-based restricted shares granted during 2021 under our 2017 Equity Incentive Plan conditioned on continued employment through that date. |

  89. 2023 Option Exercises and Stock Vested

    | (4) Amount represents value realized upon vesting at the vesting date closing price of our Common Shares of $12.68 on the vesting date of June 21, 2023. |

  90. 2023 Option Exercises and Stock Vested

    | (5) Amounts represent number of shares which vested on February 18, 2023 from awards of service-based restricted shares granted during 2020 under our 2017 Equity Incentive Plan conditioned on continued employment through that date. |

  91. 2023 Nonqualified Deferred Compensation

    2023 Nonqualified Deferred Compensation

  92. 2023 Nonqualified Deferred Compensation

    | (a) | (b) | (c) | (d) | (e) | (f) | | Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY(1) ($) | Aggregate Earnings in Last FY(2) ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($) | | Kevin J. Helmick | $80,000 | $50,699 | $86,134 | — | $788,468 | | Troy Adair | $11,200 | $17,095 | $1,056 | — | $26,130 | | Myke Matuszak | $24,000 | $12,584 | $(193) | — | $25,433 | | Timothy Shaffer | $15,600 | $15,084 | $18,423 | — | $190,893 | | Mark Wenick | $6,000 | $14,479 | $9,126 | — | $108,082 |

  93. 2023 Nonqualified Deferred Compensation

    | (1) Column contains contributions by the Company in the last fiscal year under the Nonqualified Plan. Amounts shown are included in the All Other Compensation column (i) in the Summary Compensation Table. |

  94. 2023 Nonqualified Deferred Compensation

    | (2) Earnings in this column represent estimated earnings on the Nonqualified Plan, which are based upon participant-directed investment allocations. These amounts are not included in the Summary Compensation Table because they do not constitute above market interest or preferential earnings. Amounts reported in prior years in the Summary Compensation Table for (i) Mr. Helmick for 2021 was $116,301, (ii) Mr. Shaffer for 2021 was $46,863, and (iii) Mr. Wenick for 2021 was $1,065. |

  95. 2023 Nonqualified Deferred Compensation

    Our Nonqualified Plan is described further under “2023 Named Executive Officers Compensation – Nonqualified Deferred Compensation Plan” in the Compensation Discussion and Analysis portion of this proxy statement.

  96. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control The following table summarizes potential amounts payable to each named executive officer under various termination scenarios including those provided pursuant to the terms of the Executive Separation Policy and Change in Control Agreements described in the foregoing section titled “EXECUTIVE COMPENSATION AND OTHER INFORMATION — Employment Agreements, Change in Control Agreements, Executive Separation Policy.” The figures in the table assume termination occurring on December 31, 2023.

  97. 2023 Potential Payments Upon Termination or Change in Control

    2023 Potential Payments Upon Termination or Change in Control

  98. 2023 Potential Payments Upon Termination or Change in Control

    | Compensation Components | Death or Disability(1) | Voluntary Termination without Good Reason or Involuntary Termination for Cause(2) | Voluntary Termination with Good Reason or Involuntary Termination without Cause(3) | Voluntary Termination with Good Reason or Involuntary Termination without Cause upon Change in Control(4) | Retirement | | Kevin J. Helmick | | | | | | | Severance Pay | — | — | $1,920,000 | $1,920,000 | — | | Benefits | — | — | $79,020 | $79,020 | — | | Annual Incentive Plan | $320,000 | — | $1,108,408 | $1,108,408 | — | | Long-term Incentive Plans(5) | 925,270 | — | $517,628 | $1,158,031 | — | | Nonqualified Plan | $788,466 | $788,466 | $788,466 | $788,466 | — | | Total | $2,033,736 | $788,466 | $4,413,522 | $5,053,925 | — | | Troy Adair | | | | | | | Severance Pay | — | — | $487,500 | $650,000 | — | | Benefits | — | — | $22,086 | $29,448 | — | | Annual Incentive Plan | $113,750 | — | $113,750 | $171,178 | — | | Long-term Incentive Plans(5) | $314,605 | — | $173,053 | $399,684 | — | | Nonqualified Plan | $13,782 | $13,782 | $13,782 | $13,782 | — | | Total | $442,137 | $13,782 | $810,171 | $1,264,092 | — | | Myke Matuszak | | | | | | | Severance Pay | — | — | $504,660 | $672,880 | — | | Benefits | — | — | $25,434 | $33,912 | — | | Annual Incentive Plan | $117,754 | — | $117,754 | $120,933 | — | | Long-term Incentive Plans(5) | $130,556 | — | $101,511 | $188,647 | — | | Nonqualified Plan | $24,693 | $24,693 | $24,693 | $24,693 | — | | Total | $273,003 | $24,693 | $774,052 | $1,041,065 | — | | Timothy Shaffer | | | | | | | Severance Pay | — | — | $450,000 | $600,000 | — | | Benefits | — | — | $12,780 | $17,040 | — | | Annual Incentive Plan | $105,000 | — | $105,000 | $202,245 | — | | Long-term Incentive Plans(5) | $251,371 | — | $131,336 | $317,557 | — | | Nonqualified Plan | $190,893 | $190,893 | $190,893 | $190,893 | — | | Total | $547,264 | $190,893 | $890,009 | $1,327,735 | — | | Mark Wenick | | | | | | | Severance Pay | — | — | $450,000 | $600,000 | — | | Benefits | — | — | $39,510 | $52,680 | — | | Annual Incentive Plan | $105,000 | — | $105,000 | $223,676 | — | | Long-term Incentive Plans(5) | $285,909 | — | $150,107 | $357,679 | — | | Nonqualified Plan | $93,890 | $93,890 | $93,890 | $93,890 | — | | Total | $484,799 | $93,890 | $838,507 | $1,327,925 | — |

  99. 2023 Potential Payments Upon Termination or Change in Control

    | (1) No severance benefits are provided upon a named executive officer’s death or disability other than (i) payment of the target amount under our Annual Incentive Plan, (ii) vesting of long-term incentive plan awards, and (iii) amounts vested under our Nonqualified Plan. All outstanding service-based awards fully vest upon death or disability. A pro rata portion of outstanding performance-based awards, both cash- and equity-based, vest upon death or disability, but are settled only at the end of the normal vesting period and only to the extent determined by the performance criteria over the performance period. For purposes of this calculation, it was assumed that the pro rata amount of outstanding performance-based long-term incentive awards would vest at their target levels of performance. The value of all equity awards for these purposes was calculated using the closing price of our Common Shares on December 29, 2023 of $14.45. |

  100. 2023 Potential Payments Upon Termination or Change in Control

    | (2) Our Executive Separation Policy provides the participating executives with the following benefits as a result of a voluntary termination without Good Reason or an involuntary termination by Farmers Bank for Cause (each as defined in the Executive Separation Policy): (a) their Accrued Obligations; and (b) any rights and benefits, if any, provided under plans and programs of the Company, determined in accordance with the applicable terms and provisions of such plans and programs, including, without limitation, earned but unused vacation (however the table assumes that the executives would receive no benefit for unused paid time off as of December 31, 2023, as unused paid time off cannot be carried over from one year to the next). |

  101. 2023 Potential Payments Upon Termination or Change in Control

    | (3) Our Executive Separation Policy generally provides the Covered Executives the following benefits as a result of a termination by the Company without Cause or by the Covered Executives for Good Reason: (a) the Accrued Obligations, (b) a lump sum equal to 36-months’ salary for Mr. Helmick or 18-months’ salary for Messrs. Adair, Matuszak, Shaffer and Wenick; (c) a pro rata incentive bonus in a lump sum equal to the bonus the Covered Executive would have earned (assuming performance at the “target” level); (d) a lump sum amount equal to the monthly COBRA premium payable by the Covered Executive to continue to receive health benefits at a level similar to which the Covered Executive and his or her spouse and dependents were receiving multiplied by 36 (for Mr. Helmick) or 18 (for Messrs. Adair, Matuszak, Shaffer and Wenick); and (e) a lump sum payment in an amount not to exceed $10,000 (for Mr. Helmick) or $7,500 (for Messrs. Adair, Matuszak, Shaffer and Wenick) for reasonable outplacement services for up to one year by a firm selected by Farmers. All outstanding service-based awards fully vest (calculated using the closing price of our Common Shares on December 29, 2023 of $14.45), and all outstanding performance-based awards are forfeited. Because termination is assumed for purposes of the table to have occurred on December 31, 2023, the annual incentive benefit payable to the executives is a full year bonus at the “target” level and not a pro rata portion of that annual incentive benefit. The table also assumes that the executives would receive no benefit for unused paid time off as of December 31, 2023, as unused paid time off cannot be carried over from one year to the next. |

  102. 2023 Potential Payments Upon Termination or Change in Control

    | (4) The Change in Control Agreements with our named executive officers provide for the following payments if employment is terminated by the Company other than for Cause or by the executive for Good Reason (as each defined in the Change in Control Agreements): (a) a payment in an amount equal to the executive’s annual base salary multiplied by three for Mr. Helmick, or two times for Messrs. Adair, Matuszak, Shaffer and Wenick; (b) a lump sum amount equal to the average of the annual incentive bonus paid to the executive in the three years preceding termination multiplied by three for Mr. Helmick, or two times for Messrs. Adair, Matuszak, Shaffer and Wenick; (c) a pro rata incentive bonus of the year of termination (assuming performance had been attained at the “target” level); (d) a lump sum payment in an amount equal to the monthly COBRA premium payable by the executive to continue to receive health benefits at a level similar to which the executive and his spouse and dependents were participating multiplied by 36 for Mr. Helmick, or 24 for Messrs. Adair, Matuszak, Shaffer and Wenick; and (e) a lump sum of $20,000 for outplacement services. Upon a voluntary termination for Good Reason or an involuntary termination without Cause within two years following a Change in Control, (i) all outstanding service-based awards fully vest, and (ii) all outstanding performance-based long-term incentive awards vest and are settled at the “target” level of performance. The value of all equity awards for these purposes was calculated using the closing price of our Common Shares on December 29, 2023 of $14.45. |

  103. 2023 Potential Payments Upon Termination or Change in Control

    | (5) Upon death or disability (i) all outstanding service-based awards fully vest, and (ii) a pro rata portion of outstanding performance-based awards, both cash- and equity-based, vest subject to settlement only at the end of the normal vesting period and only to the extent determined by the performance criteria over the performance period. For purposes of these calculations, it was assumed that the pro rata amount of outstanding performance-based long-term incentive awards would vest at target levels of performance. Upon voluntary termination without Good Reason or involuntary termination for Cause, all outstanding long-term incentive awards are forfeited. Upon voluntary termination with Good Reason or involuntary termination without Cause (i) all outstanding service-based awards fully vest, and (ii) all outstanding performance-based awards are forfeited. Upon a voluntary termination for Good Reason or an involuntary termination without Cause within two years following a Change in Control, (i) all outstanding service-based awards fully vest, and (ii) all outstanding performance-based long-term incentive awards vest and are settled at the “target” level of performance. The value of all equity awards for these purposes was calculated using the closing price of our Common Shares on December 29, 2023 of $14.45. |

  104. 2023 DIRECTOR COMPENSATION

    2023 DIRECTOR COMPENSATION The following table sets forth compensation that each of Farmers’ current non-employee directors received in 2023. Ms. Richardson and Mr. Culp were appointed as directors effective September 1, 2023 and their compensation was pro-rated for their period of service. Mr. Helmick, as a Farmers executive, does not receive additional compensation for his services as a director. For additional description of our director compensation, see Other Elements of Our Executive Compensation Programs – Director Compensation in Compensation Discussion and Analysis.

  105. 2023 DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Total ($)(3) | | Gregory C. Bestic | $75,900 | $17,506 | $93,406 | | Anne Frederick Crawford | $70,000 | $17,506 | $87,506 | | Carl D. Culp | $20,833 | $11,683 | $32,516 | | Neil J. Kaback | $62,500 | $17,506 | $80,006 | | Ralph D. Macali | $62,500 | $17,506 | $80.006 | | Frank J. Monaco | $70,000 | $17,506 | $87,506 | | Terry A. Moore | $107,500 | $17,506 | $125,006 | | Edward W. Muransky | $70,000 | $17,506 | $87,506 | | David Z. Paull | $62,500 | $17,506 | $80,006 | | Gina A. Richardson | $21,683 | $11,683 | $33,366 | | Richard B. Thompson | $62,500 | $17,506 | $80,006 | | Andre Thornton | $62,500 | $17,506 | $80,006 | | Nicholas D. Varischetti | $62,500 | $17,506 | $80,006 |

  106. 2023 DIRECTOR COMPENSATION

    | (1) Amounts reflect all cash amounts received during 2023 for services as a director, including an annual cash retainer of $62,500 and the following amounts paid in cash to directors with additional duties: (i) $37,500 for the independent chair of the Board; (ii) $10,000 for the chair of the Audit Committee; and (iii) $7,500 for all other committee chairs, including Executive Committee. The amounts for Mr. Bestic and Ms. Richardson also include $3,400 in fees for their service on the Board of Directors of Farmers Trust Company, a subsidiary of Farmers. |

  107. 2023 DIRECTOR COMPENSATION

    | (2) Stock Award amounts do not reflect compensation actually received by the directors in 2023. Rather, the amounts shown reflect the grant date fair market value of 1,537 restricted stock units awarded to non-employee directors on April 20, 2023 with respect to their service commencing on that date (except for Ms. Richardson and Mr. Culp, who received pro rata awards of 898 restricted stock units upon the commencement of their service on September 1, 2023). All such restricted stock unit awards are subject to vesting on the date of the 2024 Annual Meeting of Shareholders. |

  108. 2023 DIRECTOR COMPENSATION

    | (3) No non-employee director received non-equity incentive plan compensation, participated in any Company pension or nonqualified deferred compensation plan, or received any other compensation in connection with their services. |

  109. PAY VERSUS PERFORMANCE

    PAY VERSUS PERFORMANCE As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid (“CAP”) for our principal executive officer (“PEO”) and our non-PEO named executive officers (“Non-PEO NEOs”) and certain financial performance of the Company. For further information concerning the Company’s pay-for-performance philosophy and how the Company aligns executive compensation with performance, refer to the Compensation Discussion and Analysis portion of this proxy statement.

  110. PAY VERSUS PERFORMANCE

    | Year | Summary Compensation Table Total for PEO (1) | Compensation Actually Paid to PEO (2) | Average Summary Compensation Table Total for Non-PEO NEOs (3) | Average Compensation Actually Paid to Non-PEO NEOs (4) | Value of Initial Fixed $100 Investment Based On: | | Net Income (millions) (7) | Core Net Income (millions) (8) | | | | | | | Total Shareholder Return (5) | Peer Group Total Shareholder Return (6) | | | | (a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | | 2023 | $1,159,314 | $1,439,583 | $541,464 | $545,901 | $108 | $100 | $49.9 | $61.8 | | 2022 | $1,471,138 | $1,137,486 | $505,850 | $450,071 | $84 | $84 | $60.6 | $64.0 | | 2021 | $1,528,022 | $1,826,820 | $525,658 | $596,591 | $144 | $146 | $51.8 | $62.3 | | 2020 | $1,094,742 | $816,225 | $438,000 | $318,735 | $79 | $95 | $41.9 | $45.5 |

  111. PAY VERSUS PERFORMANCE

    | (1) The amounts reported in column (b) are the amounts of total compensation reported for Mr. Helmick, our PEO, for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “ Executive Compensation and Other Information – Summary Compensation Table.” |

  112. PAY VERSUS PERFORMANCE

    | (2) The amounts reported in column (c) represent the amount of CAP for Mr. Helmick as computed in accordance with Item 402(v) of Regulation S-K. Amounts do not reflect the actual amount of compensation earned by or paid to Mr. Helmick during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Mr. Helmick’s total compensation for each year to determine the CAP: |

  113. PAY VERSUS PERFORMANCE

    | Year | Reported Summary Compensation Table Total for PEO | Reported Value of Equity Awards (a) | Equity Award Adjustments (b) | Compensation Actually Paid to PEO | | 2023 | $1,159,314 | $256,324 | $23,945 | $1,439,583 | | 2022 | $1,471,138 | $575,207 | $241,555 | $1,137,486 | | 2021 | $1,528,022 | $199,768 | $498,566 | $1,826,820 | | 2020 | $1,094,742 | $188,914 | $(89,603) | $816,225 |

  114. PAY VERSUS PERFORMANCE

    | (a) The grant date fair value of equity awards represents the total of the amounts reported in the “Stock Awards” column in the Summary Compensation Table for the applicable year. |

  115. PAY VERSUS PERFORMANCE

    | (b) The equity award adjustments for each applicable year include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year (from the end of the prior fiscal year); (iii) for awards that are granted and vest in same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date in fair value (from the end of the prior fiscal year); (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock awards in the applicable year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the applicable year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. |

  116. PAY VERSUS PERFORMANCE

    | The amounts deducted or added in calculating the equity award adjustments are as follows: |

  117. PAY VERSUS PERFORMANCE

    | Year | Year End Fair Value of Equity Awards | Change in Fair Value of Outstanding and Unvested Equity Awards | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Equity Award Adjustments | | 2023 | $261,574 | $14,149 | N/A | $4,546 | $0 | N/A | $23,945 | | 2022 | $462,571 | $(192,235) | N/A | $(28,781) | $0 | N/A | $241,555 | | 2021 | $263,002 | $224,020 | N/A | $11,544 | $0 | N/A | $498,566 | | 2020 | $157,369 | $(131,995) | N/A | $(114,977) | $0 | N/A | $(89,603) |

  118. PAY VERSUS PERFORMANCE

    | (3) Amounts reported in column (d) represent the average of the amounts reported for the Company’s Non-PEO NEOs as a group in the “Total” column of the Summary Compensation Table in each applicable year. The names of each of the Non–CEO NEOs included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2023, Troy Adair, Myke Matuszak, Timothy F. Shaffer, and Mark Wenick; (ii) for 2022, Troy Adair, Tim Carney, James Gasior, and Mark Wenick; (iii) for 2021, Troy Adair, Carl D. Culp, Timothy F. Shaffer, Amber Wallace Soukenik, and Mark Wenick; and (iv) for 2020, Carl D. Culp, Mark R. Witmer, Timothy F. Shaffer, and Amber Wallace Soukenik. |

  119. PAY VERSUS PERFORMANCE

    | (4) Amounts reported in column (e) represent the average amount of CAP for the Non-PEO NEOs as a group as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-PEO NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the Non-PEO NEOs as a group for each year to determine the CAP, using the same methodology described above in Note 2: |

  120. PAY VERSUS PERFORMANCE

    | Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs | Average Reported Value of Equity Awards | Average Equity Award Adjustments (a) | Average Compensation Actually Paid to Non-PEO NEOs | | 2023 | $541,464 | $108,451 | $4,437 | $545,901 | | 2022 | $505,850 | $142,108 | $86,329 | $450,071 | | 2021 | $525,658 | $83,035 | $154,328 | $596,591 | | 2020 | $438,000 | $66,858 | $(52,407) | $318,735 |

  121. PAY VERSUS PERFORMANCE

    | (a) The amounts deducted or added in calculating the total average equity award adjustments are as follows: |

  122. PAY VERSUS PERFORMANCE

    | Year | Average Year End Fair Value of Equity Awards | Average Change in Fair Value of Outstanding and Unvested Equity Awards | Average Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | Average Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year | Average Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year | Average Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | Total Average Equity Award Adjustments | | 2023 | $102,086 | $4,277 | N/A | $(1,513) | $0 | N/A | $4,437 | | 2022 | $114,146 | $(22,858) | N/A | $(4,959) | $0 | N/A | $86,329 | | 2021 | $103,806 | $47,864 | N/A | $2,658 | $0 | N/A | $154,328 | | 2020 | $55,694 | $(43,829) | N/A | $(64,272) | $0 | N/A | $(52,407) |

  123. PAY VERSUS PERFORMANCE

    | (5) Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company’s |

  124. PAY VERSUS PERFORMANCE

    | share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period. |

  125. PAY VERSUS PERFORMANCE

    | (6) Represents the peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group used for this purpose is the following published industry index, which is also included in the five year cumulative total return chart included in the Company’s 2023 Annual Report on Form 10-K: Dow Jones U.S. MicroCap Banks Index. |

  126. PAY VERSUS PERFORMANCE

    | (7) Amounts reported represent the amount of net income reflected in the Company’s audited financial statements for the applicable year. |

  127. PAY VERSUS PERFORMANCE

    | (8) Core net income is defined as net income adjusted for certain after-tax items including acquisition related costs, litigation settlement income, litigation settlement legal expense, a charitable donation, and net losses on asset/security sales. While the Company uses numerous financial and non-financial performance measures for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that Core Net Income is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the Company to link CAP to the Company’s NEOs for the most recently completed fiscal year, to Company performance. |

  128. Analysis of Information Presented in Pay versus Performance Table

    Analysis of Information Presented in Pay versus Performance Table As described in greater detail under the Compensation Discussion and Analysis portion of this proxy statement, the Company’s executive compensation program reflects a strong pay-for-performance philosophy with an emphasis on variable, performance-based compensation. While the Company uses several objective metrics to align executive compensation with our financial performance, we do not specifically align such metrics with CAP (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, the Company is providing the following tables reflect the relationships between certain of the information presented in the Pay versus Performance table and CAP .

  129. Analysis of Information Presented in Pay versus Performance Table

    | | |

  130. CEO PAY RATIO DISCLOSURE

    CEO PAY RATIO DISCLOSURE

  131. CEO Pay Ratio

    CEO Pay Ratio Pursuant to Commission regulations adopted under the Dodd-Frank Act, we are required to calculate and disclose the ratio of the annual total compensation of our chief executive officer, Mr. Helmick, compared to the total annual compensation of our employee whose compensation represents the median compensation of all employees other than Mr. Helmick. To identify such “median employee” we added the salary paid to each employee (other than Mr. Helmick) during 2022 plus all other compensation paid to each employee for services rendered during 2022, to arrive at total compensation paid to each employee with respect to 2022. We used the amount of salary paid during 2022, rather than salary paid for services rendered during 2022 regardless of when actually paid, for purposes of identifying the median employee. We calculated the compensation of each of our employees who was employed by the Company as of December 31, 2022. The compensation of full-time, permanent employees who were hired after January 1, 2022 was annualized. The compensation of part-time, temporary and seasonal employees was not adjusted to a full-time or full-year equivalent. We included for each employee all forms of compensation that were paid to that employee during 2022, including, as applicable, the following:

  132. CEO Pay Ratio

    | • | Base salary or wages, including overtime |

  133. CEO Pay Ratio

    | • | Bonuses |

  134. CEO Pay Ratio

    | • | Grants of time-based long-term incentive compensation awards |

  135. CEO Pay Ratio

    | • | Other incentive compensation, including vesting of performance-based long-term incentive compensation awards |

  136. CEO Pay Ratio

    | • | Service awards for years of service to Farmers |

  137. CEO Pay Ratio

    | • | Christmas gifts |

  138. CEO Pay Ratio

    | • | 401(k) plan matching contributions |

  139. CEO Pay Ratio

    | • | Nonqualified deferred compensation |

  140. CEO Pay Ratio

    | • | Nonqualified executive retirement compensation |

  141. CEO Pay Ratio

    | • | Health insurance premiums |

  142. CEO Pay Ratio

    | • | Country club dues |

  143. CEO Pay Ratio

    | • | Group term life insurance, AD&D, and long-term and short-term disability premiums |

  144. CEO Pay Ratio

    After calculating each employee’s annual total compensation, we ranked the annual total compensation of all employees other than Mr. Helmick from lowest to highest and identified the middle employee in the list as the median employee. We then calculated the annual total compensation of both Mr. Helmick and such median employee for the 2023 calendar year in a manner consistent with the rules for determining amounts disclosed in the Summary Compensation Table in the Executive Compensation and Other Information portion of this proxy statement. The calculations yielded the following results:

  145. CEO Pay Ratio

    | Annual total compensation of Mr. Helmick | $1,238,710 | | The median employee’s annual total compensation | $54,029 | | The ratio of Mr. Helmick’s annual total compensation to the median employee’s annual total compensation | 22.93:1 |

  146. CEO Pay Ratio

    The Compensation Committee believes our compensation program must be equitable to all employees to motivate our employees to perform in manners that enhance shareholder value. We will continue to monitor the relationship of the compensation of our executive officers, including our chief executive officer, to the compensation of non-executive employees.