DEF 14A of Norwood Financial Corp
Filed Mar 25, 2026 · FY20250001193125-26-122940
PROPOSAL I - ELECTION OF DIRECTORS
PROPOSAL I - ELECTION OF DIRECTORS The Board of Directors currently consists of thirteen (13) members, each of whom also serves as a director of our principal subsidiary, Wayne Bank (the “Bank”). Our Articles of Incorporation provide that the Board of Directors must be divided into three classes as nearly equal in number as possible. At each annual meeting of stockholders, generally, each of the successors of the directors whose terms expire at the meeting will be elected to serve for a term of three years expiring at the third annual meeting of stockholders following the annual meeting of stockholders at which the successor director was elected. Kevin M. Lamont, Dr. Kenneth A. Phillips, and Jeffrey S. Gifford (collectively, the “Nominees”) have been nominated by the Board of Directors for terms of three years each. The Nominees currently serve as directors of the Company and have consented to serve, if elected. The persons named as proxies in the Board of Directors’ form of proxy intend to vote for the election of the Nominees, unless the proxy is marked to indicate that such authorization is expressly withheld. Should any of the Nominees withdraw or be unable to serve (which the Board of Directors does not expect) or should any other vacancy occur in the Board of Directors, it is the intention of the persons named in the Board of Directors’ form of proxy to vote for the election of such person as may be recommended to the Board of Directors by the Nominating Committee of the Board. If there is no substitute nominee, the size of the Board of Directors may be reduced. The following table sets forth the names, ages, positions with the Company, terms and length of board service, number of shares owned and percentage ownership of the Common Stock for: each of the Company’s directors and executive officers. Beneficial ownership of the directors and executive officers of the Company as a group is also set forth below.
PROPOSAL I - ELECTION OF DIRECTORS
| Name and Position(s) with Company | Age(1) | Year First Elected or Appointed(2) | Current Term Expires | Common Stock Beneficially Owned as of Record Date(3) | Percent of Class | | BOARD NOMINEES FOR TERMS TO EXPIRE IN 2029 | | | | | | | Kevin M. Lamont Director | 67 | 2011 | 2026 | 137,333 | 1.2% | | Dr. Kenneth A. Phillips Director | 75 | 1988 | 2026 | 17,015 | * | | Jeffrey S. Gifford Director | 70 | 2020 | 2026 | 150,314 | 1.4% | | DIRECTORS CONTINUING IN OFFICE | | | | | | | James O. Donnelly President and Chief Executive Officer and Director | 58 | 2022 | 2027 | 11,900 | * | | Meg L. Hungerford Director | 49 | 2017 | 2027 | 8,443 | * | | Ronald R. Schmalzle Director | 65 | 2024 | 2027 | 35,768 | * | | Dr. Andrew A. Forte Director and Vice Chairman of the Board | 67 | 2007 | 2028 | 28,660 | * | | Ralph A. Matergia Director | 76 | 2004 | 2028 | 27,728 | * | | Alexandra K. Nolan Director | 68 | 2020 | 2028 | 285,099 | 2.6% | | James A. Shook Director | 59 | 2025 | 2028 | 8,933 | * | | Dr. Marissa Nacinovich Director | 44 | 2025 | 2028 | 394 | * | | Spencer J. Andress Director | 76 | 2026 | 2029 | 15,482 | * | | Joseph W. Carroll Director | 76 | 2026 | 2028 | 50,244 | * | | Name and Position(s) with Company | Age(1) | Year First Elected or Appointed(2) | Current Term Expires | Common Stock Beneficially Owned as of Record Date(3) | Percent of Class | | EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS | | | | | | | John M. McCaffery Executive Vice President, Chief Financial Officer | 61 | n/a | n/a | 4,500 | * | | John F. Carmody Executive Vice President, Chief Credit Officer | 56 | n/a | n/a | 20,621 | * | | Vincent G. O’Bell Executive Vice President, Chief Lending Officer | 64 | n/a | n/a | 9,882 | * | | Janak M. Amin Executive Vice President, Chief Operating Officer | 60 | n/a | n/a | 73,778 | | | All directors, nominees and executive officers as a group (17 persons) (4)(5) | | | | 886,094(4)(5) | 8.1% |
PROPOSAL I - ELECTION OF DIRECTORS
| * Less than 1% of the Common Stock outstanding. |
PROPOSAL I - ELECTION OF DIRECTORS
| (1) As of December 31, 2025. |
PROPOSAL I - ELECTION OF DIRECTORS
| (2) Refers to the year the individual first became a director of the Company or the Bank. |
PROPOSAL I - ELECTION OF DIRECTORS
| (3) In calculating the percentage ownership of an individual or group, the number of shares outstanding is deemed to include any shares which the individual or group have the right to acquire within 60 days of the Record Date through the exercise of options or otherwise. |
PROPOSAL I - ELECTION OF DIRECTORS
| (4) Unless otherwise noted, the directors, executive officers and group named in the table have sole or shared voting power or investment power with respect to the shares listed in the table. The share amounts include shares of Common Stock that the following persons may acquire through the exercise of stock options within 60 days of the Record Date: Dr. Andrew A. Forte – 1,300; Meg L. Hungerford – 1,300; Kevin M. Lamont – 1,000; Ralph A. Matergia – 1,300; Dr. Kenneth A. Phillips – 1,300; and Vincent G. O’Bell – 6,750. |
PROPOSAL I - ELECTION OF DIRECTORS
| (5) Excludes 83,032 shares of Common Stock held under the Wayne Bank Employee Stock Ownership Plan (“ESOP”) for which such individuals serve as the ESOP trustees. Such shares are voted by the ESOP trustees in a manner proportionate to the voting directions of the allocated shares received by the ESOP participants, subject to the fiduciary duty of the trustees. Beneficial ownership is disclaimed with respect to such ESOP shares held in a fiduciary capacity. |
Biographical Information
Biographical Information The biographies of each of the nominees and continuing directors below contain information regarding the person’s service as a director, business experience, director positions held currently or at any time during the last five years, information regarding involvement in certain legal or administrative proceedings, if applicable, and the experiences, qualifications, attributes or skills that caused the Nominating Committee and the Board to determine that the person should serve as a director for the Company.
Nominees for Director
Nominees for Director Kevin M. Lamont is President of Lamont Development Company, Inc. Mr. Lamont developed, owned and operated two major assisted living communities in Northeast Pennsylvania. Mr. Lamont has been a licensed Nursing Home Administrator in Pennsylvania since 1980 and has experience in all aspects of business management and finance. Mr. Lamont has served as a director and Chairman of the Board of the former Hazleton General Hospital now Lehigh Valley Hospital-Hazleton. He also served an appointment to the board of the Luzerne County Redevelopment Authority. Mr. Lamont was appointed to the Board of Directors upon the completion of the Company’s acquisition of North Penn Bancorp, Inc. and North Penn Bank. His participation in our local community for over 45 years brings knowledge of the local economy and business opportunities to the Bank. Dr. Kenneth A. Phillips is a retired optometrist. Dr. Phillips has in-depth knowledge of the Bank’s market area and is active in various community activities. His participation in our local community for over 49 years brings knowledge of the local economy and business opportunities for the Bank. Jeffrey S. Gifford is the Chairman and Chief Executive Officer of The Birkett Mills, a manufacturer of buckwheat and wheat products for wholesale and retail customers, with mills located in Penn Yan and King Ferry, New York. Mr. Gifford previously served as the Chief Executive Officer of Crooked Lake Management, Inc., which is the holding company for Carey’s Lumber & Building Supply and Carey’s True Value, both located in Penn Yan, New York, from 1991 to 2016. He has also previously served as President and Chairman of the Genesee Reserve Supply company in Rochester, New York, as well as Chairman of the Yates County Industrial Development Agency. His strong local ties, business experience, financial background and his participation in his local community for over 33 years, brings knowledge and business opportunities to the Bank. Mr. Gifford was appointed to the Board of Directors upon the completion of the Company’s acquisition of UpState New York Bancorp, Inc. on July 7, 2020. Prior to the merger, he served as the Chairman of the Board of UpState New York Bancorp, Inc. since 2016 and Chairman of the Board of USNY Bank since 2015. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF THE ABOVE NOMINEES.
Continuing Directors
Continuing Directors Dr. Andrew A. Forte is the President of Forte, Inc., a family-owned corporation which operates the Stroudsmoor Country Inn, a hospitality and banquet facility in Stroudsburg, Pennsylvania. He has a Doctoral Degree in management from the Lubin School of Business, Pace University. He is a Certified Public Accountant, who practiced public accountancy with KPMG as an Audit Manager through June 1985. His financial and accounting background brings valuable expertise to the Board and his participation in our local community for over 40 years brings knowledge of the local economy and business opportunities for the Bank. Ralph A. Matergia is a founding partner of the law firm of Matergia and Dunn in Stroudsburg, Pennsylvania with which he has practiced for over 51 years. Previously, he had served as Solicitor for the Monroe County Treasurer for over 30 years. He also served as the Solicitor for the Borough of Stroudsburg from 1979 to 2016. His participation in our local community for over 51 years brings knowledge of the local economy and business opportunities for the Bank. Alexandra K. Nolan is retired. She was appointed to the Board of Directors upon the completion of the Company’s acquisition of UpState New York Bancorp, Inc. on July 7, 2020. Prior to the merger, she served as a director on the Board of UpState New York Bancorp, Inc. and USNY Bank since 2010, and was Vice Chairwomen since 2016. Ms. Nolan previously served as Editorial Finance Manager of Time Warner’s LIFE Magazine. She has also previously served as the director of Branch Analysis and Planning for Shearson/Lehman Brothers and as an analyst with the Government Affairs Office of American Express Company. Her participation in her local community for over 33 years brings knowledge of the local economy and business opportunities for the Bank. James O. Donnelly became President and Chief Executive Officer of the Company on May 9, 2022. Prior to this appointment, Mr. Donnelly served as Executive Vice President and Chief Commercial Officer of Bangor Savings Bank. Mr. Donnelly has over 30 years of banking experience. Mr. Donnelly brings to the chief executive officer role substantial experience and leadership skills in the areas of commercial lending, retail and mortgage banking, credit, financial management, wealth management and franchise growth through acquisition and market expansion. Mr. Donnelly has a long and distinguished history of community service, including in the areas of healthcare, higher education and the United Way. Meg L. Hungerford serves as the School Business Manager for the Walton, New York, Central School District. Ms. Hungerford also serves as Board Treasurer of Headwaters Emergency Medical Services, Inc., a non-profit emergency services organization. Previously she served as the Director of Finance for the City of Oneonta, New York from 2009 to 2019. She also currently serves as the Vice President of NYMIR – the New York Municipal Insurance Reciprocal. Ms. Hungerford served on the Board of Directors and Audit Committee of Delaware Bancshares, Inc. and its wholly owned subsidiary, The National Bank of Delaware County, from 2010 until their acquisition by the Company in July 2016. Her public service and involvement in her community for over 28 years provides knowledge of the local economy and business opportunities and make her a valuable contributor to the Board. Ronald R. Schmalzle is serving his second term as a Pike County Commissioner. He is also President, Co-Owner of Recreation Management Corp., dba Ski Big Bear at Masthope Mountain and Costa’s Family Fun Park and also a consultant and former Executive Director for Camping Management Corp. Schmalzle brings extensive board experience to the Company, holding former positions with various organizations, including the Pike County Hotel Tax Board, the Board of Trustees of the Wayne Memorial Hospital and Wayne Memorial Healthcare Systems, the Pike County United Way, and currently in on the board of the Pike County Planning Commission, and Pike Conservation District and the Lake Wallenpaupack Watershed Management District. In 2018, Schmalzle was honored with The Richard L. Snyder Excellence in Business Award, which recognizes outstanding corporate philanthropic leaders in Pike County and in 2025 was the recipient of the Pike County Chamber of Commerce Davis R Chant Lifetime Achievement award for his leadership to the Pike County community. Dr. Marissa Nacinovich is the President and co-owner of Zefran Dental Group, where she has dedicated her career to providing dental care to her community. Since moving back to Wayne County in 2007, she has exhibited a strong sense of community service and has served on the board of the Wayne County Children’s Christmas Bureau as Secretary since 2014. Dr. Nacinovich’s business knowledge and community involvement brings an understanding of the local economy and business opportunities for the Bank. James A. Shook is currently serving as a Wayne County Commissioner, as well as the Chair of the Wayne County Prison Board and Board Member of the Wayne-Pike Workforce Alliance. He also has been an owner of many local businesses, notably the Lake Region Supermarket Inc. A forever resident of the Hawley area, Jim has dedicated his life to his family, businesses, and the local community. Mr. Shook’s business knowledge and community involvement brings an understanding of the local economy and business opportunities for the Bank. Joseph W. Carroll is retired. Prior to his retirement in 2024, Mr. Carroll was in private law practice since 2012. Mr. Carroll was a member of the Chester County District Attorney’s Office for over 35 years in various capacities, including serving as Chester County District Attorney from 2002 until his retirement in 2012. Mr. Carroll also served as Interim President of Presence Bank from January 2019 to September 2019. A lifelong resident of Chester County, Mr. Carroll has served on the boards of United Way of Chester County, The Crime Victim Center of Chester County and several other charitable organizations. Mr. Carroll a graduate of LaSalle College and Villanova School of Law. His participation in the Pennsylvania community brings knowledge of the local economy and business opportunities for the Bank. Spencer J. Andress is the founder and President of Comprehensive Planners, LTD, which provides land use planning and project management services to a wide variety of private and municipal clients. Mr. Andress is a U.S. Army veteran who retired with the rank of Chief Warrant Officer Five and earned his Bachelor of Science degree in Physics from Lincoln University. He has been active in the Oxford community, serving as a member of several organizations and in a number of elected and appointed local government positions. Mr. Andress’ business and financial experience and contacts in the local community are among his qualifications to serve as a director.
EXECUTIVE COMPENSATION
| Name and Principal Position | Year | Salary | Bonus | Stock Awards(1) | Option Awards(1) | Nonqualified Deferred Compensation Earnings | All Other Compensation(2) | Total | | James O. Donnelly | 2025 | $605,000 | $151,250 | $198,200 | $— | $— | $55,334 | $1,009,784 | | President and | 2024 | $538,000 | $134,500 | $161,402 | $— | $— | $40,795 | $874,697 | | Chief Executive Officer | | | | | | | | | | John M. McCaffery(3) | 2025 | $350,200 | $136,000 | $59,600 | $— | $— | $39,928 | $585,728 | | Executive Vice President, Chief Financial Officer | | | | | | | | | | John F. Carmody | 2025 | $260,000 | $94,130 | $44,700 | $— | $— | $56,626 | $455,456 | | Executive Vice President, | 2024 | $235,326 | $56,332 | $40,875 | $— | $— | $33,629 | $366,162 | | Chief Credit Officer | | | | | | | | |
Employment Agreements
Employment Agreements Employment Agreement with Mr. Donnelly. James O. Donnelly entered into an employment agreement with the Company and the Bank as of May 9, 2022. Pursuant to the agreement, Mr. Donnelly is employed as the President and Chief Executive Officer of the Bank and of the Company. The agreement established an annual rate of base salary payable to Mr. Donnelly, which is reviewed by the Board of Directors annually and may be increased in its sole discretion (“Base Salary”). The agreement is for a term of thirty-six (36) months, which is automatically extended for an additional 12 months on each anniversary of the effective date unless either party has beforehand provided the other party with written notice that this agreement shall not be extended at such time. Mr. Donnelly, on one hand, and the Company and/or the Bank, on the other hand, may terminate Mr. Donnelly’s employment relationship at any time for any reason or no reason. Mr. Donnelly will participate in an equitable manner with all other senior management employees of the Bank and the Company in discretionary incentive compensation that the Boards of Directors of the Bank and the Company may award from time to time their senior management employees. Mr. Donnelly is also eligible to participate in the employee benefits generally applicable to employees of the Bank, including: group hospitalization, disability, health, dental, sick leave, life insurance, travel and/or accident insurance, retirement, pension, and/or other present or future tax-qualified and non-tax-qualified plans sponsored by the Bank. In addition, the agreement provides that the Company will provide Mr. Donnelly with application fees, bond costs and annual dues in connection with his membership at a local golfing and country club and such other private clubs, social, civic and community organizations that the Board of Directors of the Bank may reasonably determine during the term of employment hereunder. Mr. Donnelly will also be provided with the use of an appropriate, executive quality automobile with insurance, maintenance, fuel and all fees and costs paid by the Bank. Mr. Donnelly’s car may be replaced upon the sooner of three (3) years, 45,000 miles or projected excessive maintenance costs. If Mr. Donnelly’s employment is involuntarily terminated during the term of the agreement, absent termination for cause, or Mr. Donnelly terminates for “good reason” as defined in the agreement, he will receive severance compensation in a lump-sum payment equal to his Base Salary for the remaining term of the agreement, but in an amount not less than calculated for a period of 18 months or for more than a period of 24 months. In the event of Mr. Donnelly’s termination of employment following a Change in Control transaction, his severance compensation will be equal to: (i) a severance benefit equal to 2.999 times his 5-year average annualized taxable compensation, plus (ii) reimbursement for the cost of COBRA continuation for the coverage for Mr. Donnelly and his dependents in effect as of the date of such termination of employment that is available to Mr. Donnelly under the provisions of COBRA for a period of eighteen (18) months following termination of employment. In 2023, this agreement was amended to provide that the calculation of the maximum severance payment associated with a termination of employment following a Change in Control transaction would exclude the taxable income associated with the grant, vesting or exercise of stock options or restricted stock awards reported in calendar years 2024 and thereafter. Employment Agreement with Mr. McCaffery. The Company and the Bank have entered into an employment agreement with Mr. McCaffery that was effective as of June 24, 2024. Pursuant to the agreement, Mr. McCaffery is employed as the Executive Vice President and Chief Financial Officer of the Company and the Bank. The agreement established an annual rate of base salary payable to Mr. McCaffery, which is reviewed by the Board of Directors annually and may be increased in its sole discretion (“Base Salary”). The agreement is for the period commencing on June 24, 2024 (the “Effective Date”) and ending thirty-six (36) months thereafter, unless terminated earlier. On each annual anniversary date of the Effective Date, the agreement will automatically be extended for an additional 12 months unless either party has beforehand provided the other party with written notice that the agreement shall not be extended at such time. Mr. McCaffery, on one hand, and the Company and/or the Bank, on the other hand, may terminate such employment relationship at any time for any reason or no reason. Mr. McCaffery will be eligible to participate in the employee benefits generally applicable to employees of the Bank, including: group hospitalization, disability, health, dental, sick leave, life insurance, travel and/or accident insurance and retirement plans. He will receive a $600 per month car allowance. Under the agreement, Mr. McCaffery received an award under the Bank’s Annual Cash Bonus Plan calculated at the target performance level of 25% or $85,000, and received $25,000 of such award in the form of Company common stock as a Sign-On Equity Award immediately following his commencement of employment, and the balance of such bonus award ($60,000) was paid in cash during the first quarter of 2025. Future Annual Cash Bonus awards will be based upon established performance goals which will include both Company and individual goals. In the event of the involuntary termination of employment by the Bank, Mr. McCaffery will be entitled to receive a lump sum severance payment equal to the base salary then in effect that would be payable for a period of one year thereafter. All such severance amounts payable to Mr. McCaffery will be paid in one lump sum within ten (10) days of such termination of employment. Mr. McCaffery will be subject to a one-year non-competition and non-solicitation restriction following termination of employment as detailed in the agreement. In the event that either (i) the Bank or the Company terminate Mr. McCaffery’s employment without his written consent and for any reason other than Just Cause within one year following a Change in Control transaction, or (ii) he voluntarily terminates employment within 90 days of an event that both occurs following a Change in Control and the reason for such termination constitutes Good Reason, the Bank shall pay Mr. McCaffery: (i) a severance benefit equal to 200% of the Base Salary in effect as of the date of such Change in Control, plus (ii) the payment of a pro rata payout under the annual cash bonus plan to be calculated for the plan year containing such change in control. If the Bank or the Company terminates the employment of Mr. McCaffery upon a determination by its Board of Directors that such termination of employment is as a result of Just Cause (as defined in the agreement), then no such severance payments will be due and payable to Mr. McCaffery in accordance with agreement. Payments made to Mr. McCaffery and Mr. Donnelly following a termination of employment associated with a Change in Control transaction shall be reduced as necessary such that such payments will not exceed the amounts which are tax-deductible in accordance with Section 280G of the Internal Revenue Code.
Employment Agreements
Change in Control Severance Agreement with Mr. Carmody. The Company and the Bank have entered into a change in control severance agreement with John F. Carmody. The agreement provides that the executive would be entitled to a severance payment equal to one times his then-current base salary in the event of an involuntary termination without just cause or a voluntary termination with good reason during the period beginning six months prior and ending one year after a change in control. The agreement also provides that the executive may voluntarily terminate his employment for any reason within 30 days following a change-in-control transaction and receive such severance payments. Such severance payments following a change in control transaction will not exceed the tax-deductible limits under Section 280G of the Code equal to three times the five-year average of his total taxable annual compensation less $1.00. The Company has discussed that at the time of any future extension of these agreements, it intends to limit the payment of any change in control severance payments under such agreements to only upon an involuntary termination or a voluntary termination for good reason, and removing the right of the executive to voluntarily terminate his employment for any reason within 30 days of a change of control and receive such severance benefits. Salary Continuation Plans. Upon a separation of service from Wayne Bank at the Normal Retirement Age of 65, Wayne Bank is obligated to pay to Mr. Donnelly the Normal Retirement Benefits specified in his Salary Continuation Agreement in monthly installments for a period of 15 years. The Normal Retirement Benefits for Mr. Donnelly is $125,000. If Mr. Donnelly has a separation from service (other than in connection with a Change in Control or a termination for cause) or becomes disabled prior to reaching Normal Retirement Age, he is eligible for a reduced annual benefit equal to the annual retirement benefit accrued through the date of separation or disability payable in monthly installments for a period of fifteen (15) years beginning at Normal Retirement Age or the month after disability, as the case may be. In the event of a Change in Control occurring prior to a separation from service, disability or Normal Retirement Age, Mr. Donnelly is entitled to receive an annual benefit equal to their Normal Retirement Benefit in equal monthly installments for 15 years commencing the month following Normal Retirement Age in lieu of any other benefit under the Salary Continuation Agreement. In the event of an Executive’s death before separation from service, disability or a Change in Control, the Normal Retirement Benefit will be paid to Mr. Donnelly’s beneficiary over 15 years commencing the month following Mr. Donnelly’s death. In the event of Mr. Donnelly’s death after qualifying for benefits under the Salary Continuation Agreement but before Normal Retirement Age, Wayne Bank will pay Mr. Donnelly’s beneficiary the same amount and for the same period as Wayne Bank would have been required to pay Mr. Donnelly at Normal Retirement Age but payments will commence the month following Mr. Donnelly’s death. Mr. Donnelly will not be entitled to receive any benefits under the Salary Continuation Agreement in the event of termination for cause. The Salary Continuation Agreement requires Mr. Donnelly to comply with certain non-competition and non-solicitation restrictions following a termination of employment as a condition to the receipt of benefits. The Company has also entered into a Salary Continuation Agreement with Mr. Carmody, which is intended to provide benefits to Mr. Carmody upon retirement, death, or disability, or in the event of a Change in Control (as defined in his Salary Continuation Agreement). Upon a separation of service from the Bank at the Normal Retirement Age of 65, the Bank will be obligated to pay to Mr. Carmody the Normal Retirement Benefits specified in the Salary Continuation Agreement in monthly installments for a period of fifteen (15) years. The Normal Retirement Benefit for Mr. Carmody is $48,000 per annum. If Mr. Carmody continues working past the Normal Retirement Age, he will earn an increased benefit for each month worked up to age 67. If he separates from service (other than in connection with a Change in Control or a termination for cause) or becomes disabled prior to reaching Normal Retirement Age, he will be eligible for a reduced annual benefit equal to the annual retirement benefit accrued through the date of separation or disability payable in monthly installments for a period of fifteen (15) years beginning at Normal Retirement Age or the month after disability, as the case may be. In the event of a Change in Control occurring prior to a separation from service, disability or Normal Retirement Age, Mr. Carmody will be entitled to receive an annual benefit equal to his Normal Retirement Benefit in equal monthly installments for 15 years beginning the month following Normal Retirement Age in lieu of any other benefit under the Salary Continuation Agreement. In the event of a Change in Control occurring after Normal Retirement Age but prior to a separation from service or disability, the Bank will pay Mr. Carmody an annual benefit equal to the annual retirement benefit accrued through the date of the Change in Control for 15 years commencing the month following the Change in Control. In the event of Mr. Carmody’s death before separation from service, disability or a Change in Control, the Normal Retirement Benefit will be paid to Mr. Carmody’s beneficiary over 15 years commencing the month following Mr. Carmody’s death. If death occurs after Normal Retirement Age but prior to separation from service, disability or a Change in Control, the death benefit will be increased for each month worked up to age 67. If death occurs after retirement but prior to receipt of all payments due and owing under the Salary Continuation Agreement, payments will continue to be made in the same amounts and at the same times to Mr. Carmody’s beneficiary. In the event of Mr. Carmody’s death after qualifying for benefits under the Salary Continuation Agreement but before Normal Retirement Age, the Bank will pay Mr. Carmody’s beneficiary the same amount and for the same period as the Bank would have been required to pay Mr. Carmody at Normal Retirement Age but payments will commence the month following Mr. Carmody’s death. Mr. Carmody will not be entitled to receive any benefits under the Salary Continuation Agreement in the event of termination for cause. The Salary Continuation Agreement requires Mr. Carmody to comply with certain non-competition and non-solicitation restrictions following a termination of employment as a condition to the continued receipt of benefits. 2014 and 2024 Equity Incentive Plans. In 2024, the Company implemented the 2024 Equity Incentive Plan permitting the grant of stock options and stock awards to officers, employees and directors. Stock awards are typically granted annually as part of the individual performance review process. This takes place at the Compensation Committee Meeting in the fourth quarter. The full board ratifies the actions of the Compensation Committee in December and establishes the award grant date. The exercise price of stock options is based upon the last sale price of the Company’s stock at the closing on the effective date of grant or if there is no trading on such date then the last trading day prior to such date of grant. In 2025, a total of 39,000 options granted to selected employees under the 2024 Equity Incentive Plan. Such options granted in 2025 represent 0.41% of the total shares outstanding as of December 31, 2025. In 2025, a total of 25,121 shares of restricted stock were awarded under the 2024 Equity Incentive Plans to executive officers and directors. NEOs received 10,151 stock awards in 2025, as follows:
Employment Agreements
| Name | Stock Award | | James O. Donnelly | 6,651 Shares | | John M. McCaffery | 2,000 Shares | | John F. Carmody | 1,500 Shares |
Employment Agreements
On December 16, 2025, the 2024 Equity Incentive Plan was amended as follows: The Award of Directors Retainer Shares was increased from the current limit of $1,000 of each director’s monthly retainer fee to be paid in the form of Company common stock (“Common Stock”) to a total of the first 25% of each director’s monthly retainer fee to be paid in the form of common stock. No further grants are available be made under the 2014 Equity Incentive Plan, and the 2014 Equity Incentive Plan remains in existence solely to govern any previously granted awards under that plan that remain outstanding. Annual Cash Incentive Plan. Since 2019, the annual cash incentive program for NEOs has been based upon pre-defined performance criteria and attainment of such performance during the fiscal year. Depending on the Company’s targeted performance measures for the year, the Committee establishes a cash incentive bonus pool generally based on a percentage of pre-tax earnings. Specific bonus amounts are awarded to each NEO based on attainment of pre-determined financial performance targets and individual performance goals as determined by the Committee. Discretionary cash bonuses are also distributed to employees at all levels based on merit as determined by the President and approved by the Committee at the end of the fiscal year. Any adjustments to the financial performance measures utilized to determine the bonus pool for a plan year must be approved by the Board of Directors. Effective in 2023, the Company adopted an Incentive-Based Compensation Recovery Policy to enable the Company to seek recovery of any erroneously awarded compensation. Historically, this bonus pool percentage has varied from 3.0% to 5.3% of pre-tax earnings. For 2025, the Board approved a bonus pool in December 2025 equal to $2,101,256. Awards from the bonus pool were distributed to all NEOs within the discretion of the Compensation Committee and to other officers and employees. The Committee retains the authority to reduce bonus awards if it determines that excessive risk has been taken in obtaining such performance or if significant regulatory issues exist with respect to such performance. Cash bonuses approved by the Committee in December 2025 for the NEOs were made based on the Committee’s discretion and its assessment of individual performance as follows:
Employment Agreements
| Name | Bonus | % of Base Salary | | James O. Donnelly | $151,250 | 25% | | John M. McCaffery | $136,000 | 39% | | John F. Carmody | $94,130 | 36% |
Employment Agreements
401(k) Plan and ESOP. The Bank maintains a defined contribution profit-sharing and 401(k) Plan which is open to all employees over the age of 21 who have met the eligibility requirements. The 401(k) Plan permits employees to make pre-tax contributions of between 2% and 10% of their compensation to their accounts in the 401(k) Plan, and Wayne Bank will match the first 3% of the contribution. Each participant has an individual account under the 401(k) Plan and may direct the investment of his or her account among a variety of investment options or vehicles available. The Bank also sponsors the ESOP which provides for retirement benefits to all employees who have met the eligibility requirements. Under the ESOP, shares of Company common stock are allocated to participants’ accounts as they become available based upon Company contributions to the plan. The Bank did not make any contributions to the ESOP in 2024. Benefits are paid following termination of employment either in shares of the Company common stock or in cash. Executive Elective Deferral Plan. The Company and the Bank have approved an Executive Elective Deferral Plan (the “Executive Plan”) which permits a select group of its management and highly compensated employees to participate in a non-qualified deferred compensation plan. The Executive Plan enables participants to voluntarily defer a portion of the receipt of their base salary and cash bonus payments to be earned in the future. The election to defer future salary amounts or bonus amounts payable in 2025 or future years must be made in writing prior to the beginning of the respective calendar year of deferrals. The Executive Plan will conform to the requirements of Internal Revenue Code Section 409A and related regulations regarding non-qualified deferred compensation arrangements and limits changes in the time and form of payment of benefits under the Executive Plan once these elections are made by a participant upon his or her election to participate in the Executive Plan for a specific calendar year. Amounts deferred by the participant will be credited with annualized interest earnings equal to the Wall Street Journal prime rate plus 200 basis points determined on the last business day of the immediately preceding the plan year, with a maximum earnings rate of 9% and a minimum earnings rate of 2%. Such earnings rate will be retroactively reduced to 2% annualized in the event that the participant violates the non-compete and non-solicitation restrictions under the Executive Plan. The amounts payable to Executive Plan participants will be an unsecured liability of the Bank. Pay vs Performance. Regulations adopted by the SEC require companies to disclose information reflecting the relationship between executive compensation actually paid by a company and the company’s financial performance. The table below specifies executive compensation paid to James O. Donnelly, the Company’s Principal Executive Officer (“PEO”) and the other NEOs for the Company’s three most recently completed fiscal years, and selected financial performance measures for the Company’s three most recently completed fiscal years. The methodology for calculating amounts presented in the columns “Compensation Actually Paid to PEO” [column (d)] and “Average Compensation Actually Paid to Non-PEO NEOs” [column (f)], including details regarding the amounts that were deducted from, and added to, the Summary Compensation Table Totals Compensation to arrive at the values presented for Compensation Actually Paid, are provided in the footnotes to the table below. With respect to the financial performance measure, the table includes the Company’s cumulative total stockholder return (TSR) and net income as noted in the Company’s audited financial statements. Also, below is a description of the relationships between the executive compensation actually paid and the Company’s cumulative Total Stockholder Return and Net Income for the periods noted in the table.
Pay vs Performance Table
Pay vs Performance Table
Pay vs Performance Table
| Year | Summary Compensation Table Total for PEO (1) | Compensation Actually Paid to PEO (3) | Average Summary Compensation Table Total for Non-PEO NEOs (2) | Average Compensation Actually Paid to Non-PEO NEOs (4) | Value of Initial Fixed $100 Investment Based on Total Stockholder Return (5) | Net Income | | 2025 | $1,009,784 | $1,014,487 | $520,592 | $521,743 | $95.92 | $27,755,000 | | 2024 | $874,697 | $645,166 | $369,474 | $309,820 | $88.52 | $(160,000) | | 2023 | $816,435 | $633,359 | $414,108 | $374,382 | $102.42 | $16,759,106 |
Pay vs Performance Table
| (1) Mr. Donnelly was the PEO for each year presented in the table. For Mr. Donnelly, Compensation Actually Paid to the PEO in 2025 is less than the Summary Compensation Table (“SCT”) Total as reported for the corresponding year in the “Total” column of the SCT resulting from adjustments in equity award values. See Footnote 3. |
Pay vs Performance Table
| (2) For the Non-PEO NEOs, Average Compensation Actually Paid in 2025 is less than the Average SCT Total as reported for the corresponding year in the “Total” column of the SCT resulting from adjustments in equity award values. See Footnote 4. The Non-PEO NEOs for 2025 were: John M. McCaffery and John F. Carmody; the Non-PEO NEOs for 2024 and 2023 were: Vincent G. O’Bell and William Lance. |
Pay vs Performance Table
| (3) Equity Award Adjustments for the PEO (Mr. Donnelly): The following table sets forth the adjustments made during the 2025 year to the SCT “Total” column in the Pay vs Performance Table to arrive at Compensation Actually Paid to our PEO during the 2025 year presented: |
Pay vs Performance Table
| Adjustments to Determine Compensation Actually Paid for the PEO (Mr. Donnelly) | 2025 | | Deduction for Amounts Reported under the ‘Stock Awards’ Column in the SCT | $(198,200) | | Deduction for Amounts Reported under the ‘Option Awards’ Columns in the SCT | — | | Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year end | $186,561 | | Increase for Fair Value of Awards Granted during year that Vest during year | — | | Increase/deduction for Change in Fair Value from Prior Year-end to current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end | 8,321 | | Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year | 8,022 | | Deduction of Fair Value of Awards Granted Prior to year that were forfeited during year | — | | Increase based upon Incremental Fair Value of Awards Modified during year | — | | Increase based on Dividends or Other Earnings Paid during the year prior to Vesting Date of Award | — | | Total Adjustments | $4,703 |
Pay vs Performance Table
| (4) Equity Award Adjustments for the Average Non-PEO NEO Compensation Actually Paid: The following table sets forth the adjustments made during the 2025 year to the SCT “Total” column in the Pay vs Performance Table to arrive at average compensation actually paid to our Non-PEO NEOs during the 2025 year presented: |
Pay vs Performance Table
| Adjustments to Determine Average Compensation Actually Paid for the Non-PEO NEOs | 2025 | | Deduction for Amounts Reported under the ‘Stock Awards’ Column in the SCT | $(52,150) | | Deduction for Amounts Reported under the ‘Option Awards’ Columns in the SCT | — | | Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year end | $49,088 | | Increase for Fair Value of Awards Granted during year that Vest during year | — | | Increase/deduction for Change in Fair Value from Prior Year-end to current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end | $2,102 | | Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year | $2,112 | | Deduction of Fair Value of Awards Granted Prior to year that were forfeited during year | — | | Increase based upon Incremental Fair Value of Awards Modified during year | — | | Increase based on Dividends or Other Earnings Paid during the year prior to Vesting Date of Award | $— | | Total Adjustments | $1,151 |
Pay vs Performance Table
| (5) Cumulative total stockholder return (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 share price at the end and the beginning of the measurement period by the Company’s share price as of December 31, 2022, the beginning of the measurement period. |
Pay vs Performance Relationships Disclosure
Pay vs Performance Relationships Disclosure The below charts illustrate the relationship between the Compensation Actually Paid to the PEO and the average Compensation Actually Paid to the Non-PEO NEOs and the Company’s TSR for 2023, 2024, and 2025 and the relationship between the Compensation Actually Paid to the PEO and the average Compensation Actually Paid to the Non-PEO NEOs and the Company’s Net Income for 2023, 2024, and 2025:
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION Set forth below is a table providing information concerning the compensation of the Company’s directors who are not NEOs for the fiscal year ended December 31, 2025.
DIRECTOR COMPENSATION
| Name | Fees Earned or Paid in Cash | Stock Awards(1) | Option Awards(1) | All Other Compensation(2) | Total | | Dr. Andrew A. Forte | $96,335 | $24,585 | $— | $75 | $120,995 | | Susan Campfield(3) | 12,570 | 3,226 | — | 12 | 15,808 | | Meg L. Hungerford | 87,945 | 24,585 | — | 2,842 | 115,372 | | Kevin M. Lamont | 92,550 | 24,585 | — | 75 | 117,210 | | Ralph A. Matergia | 89,550 | 24,585 | — | 53 | 114,188 | | Kenneth A. Phillips | 87,980 | 24,585 | — | 53 | 112,618 | | Jeffrey S. Gifford | 90,300 | 24,585 | — | 53 | 114,938 | | Alexandra K. Nolan | 92,280 | 24,585 | — | 75 | 116,940 | | Lewis J. Critelli(3) | 77,575 | 3,226 | — | 56 | 80,857 | | Ronald R. Schmalzle | 86,410 | 24,585 | — | 56 | 111,051 | | James A. Shook | 21,210 | 24,585 | — | 27 | 45,822 | | Dr. Marissa Nacinovich | 21,210 | 24,585 | — | 27 | 45,822 |
DIRECTOR COMPENSATION
| (1) Based on the aggregate grant date for value of the award computed in accordance with FASB ASC Topic 718. For assumptions used, see Note 12 of Notes to Consolidated Financial Statements in the Annual Report on Form 10-K. The grant-date fair value of restricted stock awards was equal to the fair market value of the Company common stock underlying the award on the date of grant. As of December 31, 2025, directors who are not NEOs held the following number of stock option awards and unvested restricted stock awards. |
DIRECTOR COMPENSATION
| Name | Stock Option Awards | Restricted Stock Awards | | Dr. Andrew A. Forte | 1,300 | 2,197 | | Ronald R. Schmalzle | — | 1,375 | | Susan Campfield | 1,300 | — | | Meg L. Hungerford | 1,300 | 2,197 | | Kevin M. Lamont | 1,000 | 2,197 | | Ralph A. Matergia | 1,300 | 2,197 | | Kenneth A. Phillips | 1,300 | 2,197 | | Jeffrey S. Gifford | — | 2,197 | | Alexandra K. Nolan | — | 2,197 | | Lewis J. Critelli | — | — | | James A. Shook | — | 825 | | Dr. Marissa Nacinovich | — | 825 |
DIRECTOR COMPENSATION
| (2) Consists of the value of life insurance premiums paid by the Company for the benefit of the director. For Ms. Hungerford, also includes long-term care policy premium of $2,735 paid in 2025. |
DIRECTOR COMPENSATION
| (3) Susan Campfield and Lewis Critelli resigned from the Board effective February and September 2025, respectively. |
DIRECTOR COMPENSATION
Directors who are not full-time employees receive a fee of $785 for each meeting of the Company’s board of directors attended. Each director of the Company is also a director of Wayne Bank and receives fees accordingly. James O. Donnelly, President and Chief Executive Officer, does not receive board or committee fees for his participation thereon. Each non-employee member of Wayne Bank’s board of directors receives a retainer of $5,500 per month. Mr. Critelli received an additional monthly retainer of $1,250 for his service as Chairman. Dr. Forte became Chairman in September, and began receiving an additional monthly retainer of $1,250 in October 2025. In addition, fees are paid for various committee meetings as follows: Trust Committee ($785); Audit Committee ($785); Compensation Committee ($785); Risk Committee ($785); Nominating Committee ($785) and Loan Committee ($785). An additional Committee Chair Fee is paid to all Committee Chairs as follows: Trust Committee ($1,500); Audit Committee ($3,000); Compensation Committee ($1,500); Risk Committee ($1,500) and Nominating Committee ($1,500). For the fiscal year ended December 31, 2025, fees paid to all directors totaled approximately $855,000. The Company pays for life insurance coverage up to $50,000 for each non-employee director. Director Deferred Fee Plan. The Company and the Bank have approved a Director Deferred Fee Plan (the “Director Plan”) which permits directors of the Company and the Bank who are not employees to participate in a non-qualified deferred compensation plan. The Director Plan enables participants to voluntarily defer a portion of the receipt of their cash compensation to be received as fees as a board retainer, for board meetings and committee meetings to be earned in the future. The election to defer future fees payable in 2025 or future years must be made in writing prior to the beginning of the respective calendar year of deferrals. The Director Plan will conform to the requirements of Internal Revenue Code Section 409A and related regulations regarding non-qualified deferred compensation arrangements and limits changes in the time and form of payment of benefits under the Director Plan once these elections are made by a participant upon his or her election to participate in the plan for a specific calendar year. Amounts deferred by the participant will be credited with annualized interest earnings equal to the Wall Street Journal prime rate plus 200 basis points, determined on the last business day of the immediately preceding Plan Year, with a maximum earnings rate of 9% and a minimum earnings rate of 2%. Such earnings rate will be retroactively reduced to 2% annualized in the event that the participant violates the non-compete and non-solicitation restrictions under the Director Plan. The amounts payable to Director Plan participants will be an unsecured liability of the Company and the Bank. Pursuant to the 2024 Equity Incentive Plan, 122 shares of restricted stock were awarded to each Outside Director, except Directors Schmalzle, Shook, and Nacinovich, on January 21, 2025. In addition, 825 shares of restricted stock were awarded to each Outside Director, except Directors Critelli and Campfield due to retirement, on December 16, 2025. The restricted stock awards vest and become non-forfeitable in five equal installments beginning one year from the date of grant during periods of continued service as an Outside Director or director emeritus. Restricted stock awards will vest immediately upon a change in control of the Company. Upon the death or disability of the director, the award will be deemed earned and non-forfeitable as if the director had attained the next applicable vesting event. Any portion of stock awards that remain unearned would be forfeited. Directors are entitled to receive all dividends paid on shares underlying restricted stock awards.