DEF 14A of Burke & Herbert Financial Services Corp., May 29, 2024

DEF 14A of Burke & Herbert Financial Services Corp.

Filed May 29, 2024 · FY20230001964333-24-000259

Open on EDGAR

  1. PROPOSAL 1 ELECTION OF DIRECTORS

    PROPOSAL 1 ELECTION OF DIRECTORS The Company’s Board of Directors is comprised of sixteen directors. In accordance with the Company’s bylaws, as amended (the “Bylaws”), the Board of Directors has nominated directors (i) Mark G. Anderson, Julian F. Barnwell, Jr., Katherine D. Bonnafé, David P. Boyle, James M. Burke, S. Laing Hinson, Shawn P. McLaughlin, and Jose D. Riojas (the “Company Continuing Directors”) and (ii) Oscar M. Bean, James P. Geary, II, Georgette R. George, Gary L. Hinkle, Jason A. Kitzmiller, H. Charles Maddy, III, Charles S. Piccirillo, and Jill S. Upson (the “Summit Continuing Directors”) to be elected to serve on our Board of Directors until the next annual meeting of shareholders and until their successors are duly elected and qualified. Each nominee was nominated for election as a director upon the recommendation of the Nominating & Governance Committee and in accordance with the Agreement and Plan of Reorganization and accompanying Plan of Merger, between the Company and Summit Financial Group, Inc. (“Summit”), dated August 24, 2023 (the “Merger Agreement”), pursuant to which the Company and Summit Financial Group, Inc. merged, with the Company surviving (the “Summit Merger”) and pursuant to which the Company and Summit agreed that the Company Continuing Directors and the Summit Continuing Directors would be nominated for election at the 2024 Annual Meeting. Each of the directors currently serves as a director of the Company. The Company Continuing Directors were previously elected by shareholders of the Company; the Summit Continuing Directors were appointed in connection with the Summit Merger. The nominees for director shall be elected to the Board of Directors, where a quorum is present, if the votes cast for such nominee’s election exceed the votes cast against such nominee’s election; provided, however, that nominees for director shall be elected by a plurality of the votes cast if the number of nominees exceeds the number of directors to be elected. If directors are to be elected by a plurality of the votes cast, the shareholders shall not be permitted to vote against a nominee. If a nominee for director who is an incumbent director is not re-elected to the Board of Directors in accordance with the voting requirements stated above and no successor has been elected at such meeting of shareholders, such director must promptly tender his or her written offer of resignation in accordance with the Company’s Bylaws. Abstentions and broker non-votes do not count as votes cast and, therefore, will have no effect on a director’s election. The Board of Directors recommends that shareholders vote FOR each of the nominees for election to the Company’s Board of Directors. The table below sets forth certain information regarding the nominees up for re-election. Each of the nominees has indicated a willingness to serve if elected. However, if any nominee becomes unable to serve, the proxies received in response to this solicitation will be voted for replacement nominees selected by the Board of Directors in accordance with the Bylaws.

  2. PROPOSAL 1 ELECTION OF DIRECTORS

    | Name | Position | Age | Director Since | Term Expires | | David P. Boyle | Chair and CEO | 60 | 2020 | 2025 | | H. Charles Maddy, III | Director and President | 61 | 2024(1) | 2025 | | Oscar M. Bean | Vice Chair and Director | 73 | 2024(1) | 2025 | | S. Laing Hinson | Vice Chair and Director | 69 | 2007 | 2025 | | Mark G. Anderson | Director | 61 | 2017 | 2025 | | Julian F. Barnwell, Jr. | Director | 68 | 2001 | 2025 | | Katherine D. Bonnafé | Director | 58 | 2018 | 2025 | | James M. Burke | Director | 69 | 2014 | 2025 | | James P. Geary, II | Director | 67 | 2024(1) | 2025 | | Georgette R. George | Director | 63 | 2024(1) | 2025 | | Gary L. Hinkle | Director | 74 | 2024(1) | 2025 | | Jason A. Kitzmiller | Director | 50 | 2024(1) | 2025 | | Shawn P. McLaughlin | Director | 64 | 2008 | 2025 | | Charles S. Piccirillo | Director | 69 | 2024(1) | 2025 | | Jose D. Riojas | Director | 69 | 2018 | 2025 | | Jill S. Upson | Director | 57 | 2024(1) | 2025 |

  3. PROPOSAL 1 ELECTION OF DIRECTORS

    | (1) Appointed pursuant to the Merger Agreement. |

  4. Burke & Herbert Financial Services Corp. 2024 Director Biographies

    Burke & Herbert Financial Services Corp. 2024 Director Biographies Set forth below is information concerning the names, ages, principal occupations and business experience for all nominees for election as director as well as the particular experience, qualifications, attributes or skills that led the Board of Directors to conclude that each should serve as a director. There are no family relationships between any directors or executive officers. David P. Boyle: David P. Boyle has been a Director since January 1, 2020, and became Chair of the Board in 2023. Mr. Boyle was appointed to the Board at the same time he assumed the role of President and Chief Executive Officer of the Company. From June 2019 until his appointment as President and Chief Executive Officer, Mr. Boyle served as the Company’s President and Chief Operating officer. He previously served as Executive Vice President and Chief Financial Officer at Orrstown Financial Services, Inc., a community bank, from 2012 to June 2019. Earlier in his career he served in key leadership and executive positions with large banks, including as Chief Performance Officer at PNC Financial Services Group, Inc., Regional President for National City Bank, and as Chair, President, and Chief Executive Officer at Wayne Bancorp, a community bank. The Board believes Mr. Boyle’s leadership experience in financial services, including his role as Chief Executive Officer of the Company, provides him with the necessary skills and qualifications to effectively serve the Company. H. Charles Maddy, III: H. Charles Maddy, III has been a director since 19931 and is currently the President of the Company. Mr. Maddy has demonstrated exceptional leadership through his participation in a variety of professional and community service activities, including his service as Director and past President of the West Virginia Bankers’ Association, chair of its Audit Committee and member of its Legislative / Government Relations Committee, Pension & Benefits Committee and BankPAC Committee; Director of the Federal Home Loan Bank of Pittsburgh and serves on its Finance Committee and Operational Risk Committee and past Chair of its Audit Committee; member of American Bankers Association and serves on its Federal Home Loan Bank Open Committee; Director and a Founder of the Hardy County Child Care Center; Director of Valley View Golf Association; past President and past Director of the West Virginia Association of Community Bankers and past Director of the Hardy County Community Foundation. Mr. Maddy has also been recognized as a leader in his industry and has been the recipient of the Outstanding CPA in Business and Industry Award and the AICPA Business and Industry Hall of Fame Award. The Board believes Mr. Maddy’s leadership experience in financial services, including his extensive background in banking provide him with the necessary skills to effectively serve the Company. Oscar M. Bean: Oscar M. Bean has been a Director since 19871. Mr. Bean is a Partner of Bean & Bean, Attorneys at Law and was formerly the prosecuting attorney of Hardy County, West Virginia. Mr. Bean served on the Board of the Moorefield Scholarship Fund and served as a member of the West Virginia University College of Law Visiting Committee. He is currently the Chair of the Eastern West Virginia Community and Technical College Foundation. Since March 2017, Mr. Bean has been a member of the West Virginia Supreme Court’s Character Committee which interviews applicants who seek to be admitted to practice law in the State of West Virginia. The Company values Mr. Bean’s legal skills and ability to effectively communicate. S. Laing Hinson: S. Laing Hinson has been a Director since 2007. In 1988 he founded and has been the General Partner of S. L. Hinson Associates, LLLP, a commercial real estate development firm headquartered in Alexandria, VA. The Board believes Mr. Hinson’s business acumen, accounting and finance knowledge, and leadership qualities make him a valuable Board member. Mark G. Anderson: Mark G. Anderson has been a Director since 2017. In 1996, he formed and is President and Chief Executive Officer of MGAC, Inc., an international provider of program/project management, cost management, procurement and technology solutions for major capital construction projects with offices in Washington DC, New York, Toronto, Seattle, San Francisco, Los Angeles, London (UK), Brighton (UK), Birmingham (UK) and Glasgow Scotland. The Board values Mr. Anderson’s project management skills and strategic planning capabilities. Julian F. Barnwell, Jr.: Julian F. Barnwell, Jr. has been a Director since 2001 and from 1991 has served as the President and Chief Executive Officer of Design & Production, Inc., an exhibit project management, production and technology systems company that provides services to museums, educational institutions, visitor centers, information centers, science and nature centers, and major expositions throughout the United States and abroad. Mr. Barnwell’s significant Board and executive experience as well as his acumen and organizational skills are valued by the Board. Katherine D. Bonnafé: Katherine D. Bonnafé became a director in 2018. Since 2019, she has been Chief Executive Officer of Combined Creative LLC, a strategy and investment family office headquartered in Bethesda, MD overseeing investments and new business initiatives. Prior to Combined Creative, Ms. Bonnafé had a 30-year career at Combined Properties, Incorporated, a commercial management and development company. The Board believes Ms. Bonnafé market and industry knowledge and her operations management capabilities allow her to strengthen the Board’s overall effectiveness. (1) References to Company Board service tenure for Director Maddy, Bean, Geary, George, Hinkle, Kitzmiller, Piccirillo, and Upson are for Summit Financial Group, Inc., prior to the merger with and into Burke & Herbert Financial Services Corp. on May 3, 2024, when those directors became directors of Burke & Herbert Financial Services Corp. James M. Burke: James M. Burke has been a director since 2014 and is the President of Burke Capital Corporation, an unaffiliated financial consulting company based in San Francisco, California, which he founded in 1991. His company specializes capital sourcing, crisis management, restructurings, and exits and harvests. He is a fifth-generation lineal descendant of one of the Company’s founders. The Board values Mr. Burke’s strategic problem-solving ability and broad business acumen, as well as his deep understanding of the Bank’s history. James P. Geary, II: James P. Geary II has been a director since 20071 and is a Partner of the law firm Geary & Geary since 1982. Mr. Geary is a title insurance agent for Old Republic Title Insurance Company and First American Title Insurance Company. He is a current member of the West Virginia Forestry Association. Mr. Geary has served as a mediator in the 21st and 22nd West Virginia Judicial Circuits and serves as the Mental Hygiene Commissioner in the 21st West Virginia Judicial Circuit. He is a charter member of the Grant and Hardy County Gideons and is the Faithfund Regional Program Leader of the West Virginia Gideons International. Mr. Geary was also a professor at Shepherd College, Shepherdstown, West Virginia. The Board values Mr. Geary’s knowledge in real estate and general market knowledge.

  5. Burke & Herbert Financial Services Corp. 2024 Director Biographies

    Georgette R. George: Georgette R. George has been a director since 20101. Ms. George is the Chief Executive Officer and Executive Team Member of Monarch Holdings. She has been engaged with the businesses within Monarch for more than 30 years. She is a principal in a number of business enterprises involved in various retail, office, and hotel development projects, of which she manages the administrative, hotel, and financial operations. Ms. George has served on the Boards of numerous non-profit organizations, including the Thomas Hospital Foundation, Community Council of Kanawha Valley, and the Convention Bureaus of the cities of both Charleston and South Charleston. She currently serves as a director of the West Virginia Regional Technology Park Corp, Greater Kanawha Valley Foundation, West Virginia Investment Management Board and the West Virginia School of Osteopathic Medicine Foundation. She is a member of the Federal Reserve West Virginia Advisory Committee for the Fifth District. Ms. George’s experience and skills in accounting and finance are valued by the Company. Gary L. Hinkle: Gary L. Hinkle has been a director since 19931. Mr. Hinkle is currently the President of Hinkle Trucking, Inc., Dettinburn Transport, Inc., Mt. Storm Fuel Inc., and H. T. Services, Inc. and has over 35 years of experience in owning and operating his own business. Mr. Hinkle’s business knowledge and entrepreneurial skills are valued by the Company. Jason A. Kitzmiller: Jason A. Kitzmiller has been a director since 20181. Since 2004, Mr. Kitzmiller has served as president of A.L.L. Construction Inc., specializing in excavating and utility contracting, where he is actively involved in daily management, financial and operational decisions. Mr. Kitzmiller is the vice-president of ALL Construction and Excavating LLC and also serves as managing member of Alleghany Investments LLC and OSA Enterprises LLC. In addition, he is president of D.P. Southbound LLC and ALL Concrete Inc. and is the owner of ALL Outdoors, LLC. Mr. Kitzmiller served in the U.S. Navy as an aircraft mechanic and was honorably discharged. Mr. Kitzmiller is past president and current board member of the West Virginia Construction Labor Council and a member of the West Virginia Contractors Association. He is active in youth sports and is the vice-president and board member of Grant County Little League Basketball and board member of the Grant County Little League Baseball. The Board values Mr. Kitzmiller’s business knowledge and financial acumen. Shawn P. McLaughlin: Shawn P. McLaughlin has been a Director since 2008. He is the President and Chief Executive Officer of McLaughlin Ryder Investments, Inc., a financial services firm based in Alexandria, VA, which he founded in 2011. Additionally, Mr. McLaughlin serves as President and Chief Executive Officer of Management Solutions Plus, Inc., a full-service association management company. His experience and skills in accounting, finance, and communication are valued by the Board. (1) References to Company Board service tenure for Director Maddy, Bean, Geary, George, Hinkle, Kitzmiller, Piccirillo, and Upson are for Summit Financial Group, Inc., prior to the merger with and into Burke & Herbert Financial Services Corp. on May 3, 2024, when those directors became directors of Burke & Herbert Financial Services Corp. Charles S. Piccirillo: Charles S. Piccirillo has been a director since 19981. Mr. Piccirillo was a member in the law firm of Shaffer & Shaffer, PLLC through 2020, at which time he became counsel to Shaffer & Shaffer, PLLC. On January 1, 2021, Mr. Piccirillo established and is the sole member of C.S. Piccirillo Law, PLLC. He is also a Partner with Lawoff Associates, and President of Auggus Enterprises, Inc., both of which are real estate entities. Mr. Piccirillo has more than 30 years of trial experience and has bar admissions to the West Virginia Supreme Court of Appeals and the United States District Courts throughout West Virginia. His market knowledge and experience in real estate law are valued by the Board. Jose D. Riojas: Jose D. Riojas has been a director since 2018. Brigadier General (U.S. Army, Retired) Riojas is the owner of Jose D. Riojas, LLC, a consultancy company formed in 2015, specializing in executive coaching and organizational strategic development. Before that, he served as the Chief of Staff and Assistant Secretary of Operations at the U.S. Department of Veterans Affairs (VA). Prior to joining VA, he served as the Vice President for Strategic Initiatives at the University of Texas at El Paso after completing his final military assignment as the Commanding General of Joint Task Force North, a multi-agency organization. His experience in leadership development, strategic planning, and risk management provides valuable perspective to the Board. Jill S. Upson: Jill S. Upson has been a director since 20211. Since 2018, Ms. Upson has served as Executive Director of the Herbert Henderson Office of Minority Affairs and serves as Executive Director of the West Virginia Women’s Commission. Ms. Upson is a former member of the West Virginia House of Delegates where she served as Vice Chair of the Banking and Insurance Committee in addition to serving on various committees, caucuses, and commissions. Ms. Upson holds the distinction of making state history as the first black Republican woman elected to the West Virginia House of Delegates. Due to her steadfast leadership in criminal justice reform, Ms. Upson was recognized by the Governor of West Virginia with his Civil Rights Award. She also serves as Chair of the Martin Luther King, Jr. State Holiday Commission, and Chair of the COVID-19 Advisory Commission on Racial Disparities. Ms. Upson’s skills in negotiations and communication are valued by the Board. In addition to the information presented above regarding each nominee’s specific experiences, qualifications, attributes and skills, we believe that all of our directors and nominees have a reputation for integrity and adherence to high ethical standards. Each of our nominees has demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment of service to us and our board. Finally, we value our nominee’s experience on other company boards and board committees. There are no family relationships among any of our nominees or executive officers. (1) References to Company Board service tenure for Director Maddy, Bean, Geary, George, Hinkle, Kitzmiller, Piccirillo, and Upson are for Summit Financial Group, Inc., prior to the merger with and into Burke & Herbert Financial Services Corp. on May 3, 2024, when those directors became directors of Burke & Herbert Financial Services Corp.

  6. BOARD OF DIRECTORS

    BOARD OF DIRECTORS

  7. Overview

    Overview The primary objective of our executive compensation program is to attract and retain highly skilled and motivated executive officers that significantly contribute to the Company’s success. The executive officers are expected to manage the Company to promote its growth and profitability, minimize risk, and advance the interests of our shareholders. As such, the Company’s compensation program is designed to provide levels of compensation that reflect the executive’s role in the organization and reward the individual’s performance within the context of the Company’s performance. The Compensation Committee of our Board believes that evaluating performance in this manner aligns the interests of our executive officers with the achievement of long-term sustainable financial performance and resulting increases in shareholder value. We believe that our compensation program contributes to achieving these results. The principal elements of our executive compensation program are annual base salary, incentive compensation, including short-term incentive compensation through annual cash bonuses and long-term incentives through the grants of equity-based awards and participation in our deferred compensation plans. In addition, we provide our executives with benefits that are generally available to all eligible employees. We view the principal elements of our executive compensation as related, but distinct, and aim to deliver competitive annual total compensation opportunities to the Company’s executive officers commensurate with individual and Company performance. We determine the appropriate level for each compensation element based, in part, but not exclusively, on our view of internal equity and consistency, performance, the competitive landscape, and other information we deem relevant. We believe that equity-based awards are a motivator in attracting and retaining executives over the long-term, and that salary and cash bonuses are important considerations in the short-term. Annually, our Compensation Committee performs a strategic review of our executive officers’ total compensation. Through this review, the Compensation Committee determines whether the Company adequately compensates our executive officers for both individual and organizational results, relative to external compensation benchmarks. The Compensation Committee considers the Company’s internal objectives (financial and non-financial), the individual executive’s contribution to Company objectives, external peer compensation levels, and peer performance in making annual compensation decisions for the Company’s executive officers. The Compensation Committee also engages an independent third-party compensation consultant, from time-to-time, to help ensure that our executive compensation practices align with general peer compensation approaches. The Compensation Committee also receives annual assessments prepared by the Chief Executive Officer regarding the performance of each named executive officer (“NEO”), other than the Chief Executive Officer. The Chief Executive Officer participates in the determination of compensation for the NEOs other than himself. The Compensation Committee also continually reviews the Company’s compensation policies to identify any practice that might encourage an employee to expose the Company to unacceptable risk. At the present time, the Compensation Committee is satisfied that the current executive compensation program does not encourage the Company’s executive officers, including the NEOs, to expose the Company to inappropriate risk.

  8. Summary Compensation Table

    Summary Compensation Table The following table sets forth an overview of the compensation for David P. Boyle, President & Chief Executive Officer, Roy E. Halyama, Executive Vice President, Chief Financial Officer, and Jeffrey A. Welch, Executive Vice President, Chief Credit Officer, who collectively constitute our NEOs for the year ended December 31, 2023. The current compensation of the NEOs is not necessarily indicative of how we will compensate our NEOs in the future. Evaluation and changes, as needed, are made to our compensation structure to ensure compensation packages remain competitive and align with our compensation philosophy.

  9. Summary Compensation Table

    | Name & Principal Position | Year | Salary | Bonus | Stock Awards (1) | Nonqualified Deferred Compensation Earnings (2) | Non-Equity Incentive Plan Compensation | All Other Compensation (3) | Total | | David P. Boyle, President & Chief Executive Officer | 2023 | $825,000 | $— | $388,296 | $4,142 | $— | $356,241 | $1,573,679 | | | 2022 | 825,000 | 85,750 | 273,875 | 4,587 | 245,498 | 188,348 | 1,623,058 | | Roy E. Halyama, Executive Vice President — Chief Financial Officer | 2023 | 350,000 | — | 139,930 | — | — | 149,050 | 638,980 | | | 2022 | 344,230 | 48,750 | 52,584 | — | 90,930 | 10,675 | 547,169 | | Jeffrey A. Welch, Executive Vice President — Chief Credit Officer | 2023 | 331,477 | — | 56,429 | 2,514 | — | 144,090 | 534,510 | | | 2022 | 324,920 | — | 52,584 | 3,110 | 84,806 | 75,635 | 541,055 |

  10. Summary Compensation Table

    (1)The amounts represent the aggregate grant date fair value of restricted stock unit (“RSU”) and performance-based stock units (“PRSU”) awards granted in 2023 pursuant to the Company’s 2019 Stock Incentive Plan calculated in accordance with the Financial Accounting Standards Board Accounts Standards Codification Topic 718 (“FASB ASC Topic 718”). See Note 23 — Share-Based Compensation to the Company’s 10-K for the year ended December 31, 2023, filed with the SEC on March 22, 2024, for additional information about the Company’s share-based compensation plans, including the assumptions made in the valuation of awards. (2)Represents the above-market only earnings that exceed 120% of the applicable federal long-term rate for the Supplemental Executive Retirement Plan; see more detail below within “Other Compensation & Benefits”. (3)The 2023 compensation represented by the amounts set forth in the “All Other Compensation” column in the table above is detailed in the following table.

  11. Summary Compensation Table

    | Name & Principal Position | Vehicle Allowance or Personal use of Company Vehicle | Country Club Dues | Supplemental Executive Retirement Plan Contribution | Split Dollar Life Insurance Benefit | Matching Contributions to 401(k) Plan | Total | | David P. Boyle, President & Chief Executive Officer | $1,179 | $11,882 | $330,000 | $1,630 | $11,550 | $356,241 | | Roy E. Halyama, Executive Vice President — Chief Financial Officer | — | — | 137,500 | — | 11,550 | 149,050 | | Jeffrey A. Welch, Executive Vice President — Chief Credit Officer | — | — | 132,540 | — | 11,550 | 144,090 |

  12. Outstanding Equity Awards at Fiscal Year-End 2023

    Outstanding Equity Awards at Fiscal Year-End 2023 The following table sets forth information concerning all RSU awards (both time-based and performance-based) held by the NEOs at December 31, 2023. The number of shares subject to each award have been adjusted to reflect any stock dividends, stock splits and merger of share exchange assumption adjustments effected after the date of such award (none of which gave rise to additional accounting expenses). Each RSU listed in the following table was granted under the Burke & Herbert Bank & Trust Company 2019 Stock Incentive Plan (the “2019 SIP”). On March 30, 2023, the Company’s shareholders approved the Burke & Herbert Financial Services Corp. 2023 Stock Incentive Plan (the “2023 SIP”). However, all stock awards granted in 2023 to the NEOs were granted under the 2019 SIP prior to the adoption of the 2023 SIP.

  13. Outstanding Equity Awards at Fiscal Year-End 2023

    | | | Stock Awards | | | | | Name | Grant 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 | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested (1) | | David P. Boyle | 1/19/2023 | 3,361(2) | $211,407 | 2,250(3) | $141,525 | | | 1/21/2022 | 5,000(2) | 314,500 | — | — | | | 12/31/2021 | 8,000(4) | 503,200 | 8,000(4) | 503,200 | | | 2/25/2021 | 3,480(2) | 218,892 | — | — | | | 6/03/2019 | 1,520(5) | 95,608 | — | — | | Roy E. Halyama | 1/19/2023 | 829(2) | 52,144 | 1,250(3) | 78,625 | | | 1/21/2022 | 960(2) | 60,384 | — | — | | | 12/31/2021 | 3,000(4) | 188,700 | 3,000(4) | 188,700 | | | 4/05/2021 | 2,040(2) | 128,316 | — | — | | Jeffrey A. Welch | 1/19/2023 | 773(2) | 48,622 | — | — | | | 1/21/2022 | 960(2) | 60,384 | — | — | | | 2/10/2021 | 1,480(2) | 93,092 | — | — |

  14. Outstanding Equity Awards at Fiscal Year-End 2023

    (1)Based on the $62.90 closing price of the Company’s Common Stock on December 29, 2023, the last trading day of the Company’s 2023 fiscal year, as quoted on the NASDAQ Stock Market LLC. (2)Reflects time-based RSU awards that vest on the third anniversary of the grant date. (3)Represents PRSUs granted in 2023, which are subject to a vesting performance condition based on a targeted and sustained market price of the Company’s stock price. To the extent the performance condition is achieved, the awards vest, subject to continued service, upon the fifth anniversary (January 19, 2028) of the grant date. The award also provides for accelerated vesting to the extent the performance condition is achieved before the end of the five-year performance period (but no earlier than January 19, 2026, the third anniversary of the grant date). (4)Represents PRSUs granted in 2021, half of which were subject to a vesting performance condition based on a holding company reorganization and half of which were subject to a vesting performance condition based on a targeted and sustained market capitalization. To the extent the performance conditions are met, the awards vest, subject to continued service, upon the fifth anniversary of the grant date. The award also provides for accelerated vesting to the extent both performance conditions are achieved before the end of the five-year performance period. The first performance condition was achieved in 2022 and therefore 8,000 units for Mr. Boyle and 3,000 units for Mr. Halyama are subject only to continued time-based vesting until December 31, 2026, the fifth anniversary of the grant date (or such earlier time upon which the second performance metric is achieved). In accordance with SEC rules, those amounts are included in the column entitled “Number of shares or units of stock that have not vested.” The portions of the awards that remained subject to a performance condition as of December 31, 2023, are included in the column entitled “Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested.” (5)Reflects a time-based RSU award that vests one-third on each of the third, fourth, and fifth anniversaries of the grant date.

  15. Director Compensation

    Director Compensation Our directors may receive both cash and equity compensation. Mr. Boyle does not receive additional compensation for his service as a director or Chair of the Board. During 2023, E. Hunt Burke served as a non-executive employee of the Company and was generally eligible to participate in benefit plans offered to employees of the Company. His compensation as an employee is reflected in the Director Compensation table below as “All Other Compensation.” During the year ended December 31, 2023, directors received $2,000 for each Holding Company Board meeting attended, $1,350 for each Bank Board meeting, and $500 for each Committee meeting attended ($600 for each Committee Chair). Directors may defer compensation into our Deferred Compensation Plan described above. On January 19, 2023, each director was awarded 1,000 PRSUs, which contain the same terms and conditions as the PRSUs awarded to Messrs. Boyle and Halyama on January 19, 2023, as described in the section entitled “Other Incentive Compensation” above. The following table sets forth amounts paid to directors during the year ended December 31, 2023.

  16. Director Compensation

    | Name | Fees Earned or Paid in Cash (1) | Stock Awards (2) | Nonqualified Deferred Compensation Earnings (3) | All Other Compensation | Total | | E. Hunt Burke (4) | $129,850 | $63,530 | $8,241 | $142,737 | $344,358 | | Mark G. Anderson | 96,500 | 63,530 | — | — | 160,030 | | Julian F. Barnwell, Jr. | 95,600 | 63,530 | — | — | 159,130 | | Katherine D. Bonnafé | 97,700 | 63,530 | — | — | 161,230 | | James M. Burke | 94,500 | 63,530 | — | — | 158,030 | | Nicholas Carosi, III | 98,200 | 63,530 | — | — | 161,730 | | S. Laing Hinson | 95,800 | 63,530 | — | — | 159,330 | | Michael D. Lubeley | 93,750 | 63,530 | — | — | 157,280 | | Shawn P. McLaughlin | 97,800 | 63,530 | — | — | 161,330 | | Jose D. Riojas | 97,700 | 63,530 | — | — | 161,230 |

  17. Director Compensation

    (1)The amounts set forth in the “Fees Earned or Paid in Cash” includes retainer fees of $60,000 for each director (except for E. Hunt Burke, who received $105,000 as a retainer fee), plus fees for service as Committee Chair and meeting attendance. Ms. Bonnafé and Mr. Riojas participate in the Deferred Compensation Plan and deferred a portion of their cash retainer and fees into the plan in 2023. (2)In 2023, the Company granted each director 1,000 PRSUs, subject to a vesting performance condition based on a targeted and sustained market price of the Company’s stock price. To the extent the performance condition is achieved, the awards vest, subject to continued service, upon the fifth anniversary (January 19, 2028) of the grant date. The award also provides for accelerated vesting to the extent the performance condition is achieved (but no earlier than January 19, 2026, the third anniversary of the grant date). The amounts set forth in the “Stock Awards” column reflect the aggregate grant date fair value of the PRSUs, calculated in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”). As of December 31, 2023, each director in the table had unvested stock awards with respect to 7,000 shares. (3)While generally our non-employee directors are not entitled to participate in our SERP, E. Hunt Burke participates in the SERP in his capacity as an employee of the Company. The amount set forth in the “Nonqualified Deferred Compensation Earnings” for E. Hunt Burke represent only the above-market earnings on his SERP account balance that exceed 120% of the applicable federal long-term rate for the SERP; as described in “Other Compensation & Benefits.” As of 2022, the Company ceased making additional contributions to the SERP on Mr. Burke’s behalf. (4)The amounts set forth in the “All Other Compensation” for E. Hunt Burke includes compensation he receives as a non-executive employee of the Company and not in his capacity as a director. Specifically, it includes salary of $135,000, split-dollar value of insurance premiums paid by the Company in 2023 of $3,010, and 401(k) matching contributions of $4,727.