UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington,
Filed by a Party other than the Registrant ☐ Check the appropriate box: ☐ Preliminary Proxy Statement ☐ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) ☒ Definitive Proxy Statement ☐ Definitive Additional Materials ☐ Soliciting Material Pursuant to §240.14a-12 MERIDIAN CORPORATION | ||
2024.
Annual Meeting.
Michael Curry, Corporate Secretary | ||
|
Malvern, Pennsylvania
April 10, 2019
4, 2024
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4, 2024.
To be able to vote, you must have been a shareholder on March 29, 2019, the record date on which we determined shareholders entitled to notice of, and to vote at, the Annual Meeting (the "Record Date"). As of the close of business on the Record Date, Meridian had 6,406,996 shares of common stock issued and outstanding.
As
What am I being asked to vote on?
There are two matters scheduled for a vote at the Annual Meeting: (1) the electionVoting of three "Class B" members of the Board of Directors to hold office until our 2022 Annual Meeting of Shareholders;Shares and (2) the ratification of the appointment of KPMG, LLP as the Corporation's independent registered public accounting firm for the year ending December 31, 2019.
How many votes do I have?Principal Holders Thereof
What is a quorum?
For the election of directors, the candidates receiving the highest number of "For" votes, in person or by proxy, up to the number of directors to be elected, shall be elected.
For the proposal to ratify the appointment of KPMG, LLP as the Corporation's independent registered public accounting firm for the year ending December 31, 2019, "For" votes must be received by a majority of the votes cast in person or by proxy.
How do I vote?
For the election of directors, you may either vote "For" each of the three nominees or you may "Withhold" your vote for any nominee you specify. For any other matter to be voted on, you may vote "For" or "Against" or abstain from voting.
Shareholder of Record: Shares Registered in Your Name. If you are a shareholder of record, you may vote in personproposals being considered at the Annual Meeting. Alternatively, you mayMeeting are as follows:
Proposal | | | Vote Requirement | | | Effect of Abstention | | | Effect of Broker Non-Vote | | |||
1 | | | Election of Directors | | | Highest number of votes cast | | | No effect | | | No effect | |
2 | | | Advisory Vote on Executive Compensation | | | Affirmative vote of a majority of the votes cast | | | No effect | | | No effect | |
3 | | | Ratification of the appointment of Crowe, LLP as Meridian’s independent auditor | | | Affirmative vote of a majority of the votes cast | | | No effect | | | No effect | |
Proposal | | | Vote Recommendation | | |||
1 | | | Election of Directors | | | FOR the election of each of the 2 director nominees | |
2 | | | Advisory Vote on Executive Compensation | | | FOR the approval of the non-binding say-on-pay proposal to approve the compensation of the NEOs | |
3 | | | Ratification of the appointment of Crowe, LLP as Meridian’s independent auditor | | | FOR the ratification of the appointment of Crowe, LLP as Meridian’s independent auditor | |
To vote by proxy, simply complete, sign, and date the accompanying proxy card. Return it promptly in the envelope provided. You may also vote by telephone or electronically via the internet. If you return your signed proxy card to us before the Annual Meeting, we will vote your shares as you direct.
Beneficial Owner: Shares Registered in the Name of Broker, Bank, or Other Agent. If your shares are held in "street name," that is, your shares are held in the name of a brokerage firm, bank, or other nominee, in lieu of a proxy card you should receive a voting instruction form from that institution by mail. Simply complete and mail the voting instruction card to ensure that your vote is counted.
If you are a registered holder, you may also vote your shares in person at the Annual Meeting. If your shares are held in street name and you wish to vote in person at the meeting, you must obtain a proxy issued in your name from the record holder (for example, your broker) and bring it with you. We recommend that you vote your shares in advance as described above so that your votevotes will be counted if you later decide not to attend the Annual Meeting.
What if I return a proxy card but do not make specific choices?
If you are a registered shareholder and return a signed and dated proxy card without marking any voting selections, your shares will be voted "For" the election of the nominees for director in "Class B" and in favor of the all items being approved or ratified. If any other matter is properly presented at the meeting, then one of the individuals named on your proxy card as your proxy will vote your shares using his or her best judgment.
What if I receive more than one proxy card or voting instruction form?
If you receive more than one proxy card or voting instruction form because your shares are held in multiple accounts or registered in different names or addresses, please be sure to complete, sign, date, and return each proxy card or voting instruction form to ensure that all of your shares will be voted. Only proxy cards and voting instruction forms that have been signed, dated, and timely returned will be counted in the quorum and voted.
Who will count the votes and how will my vote(s) be counted?
Market.NYSE Rule 452 by The New York Stock Exchange. A "broker non-vote"“broker non-vote” results on a matter when your broker or nominee returns a proxy but does not vote on a particular proposal because it does not have discretionary authority to vote on that proposal and has not received voting instructions from you. We believe that your broker or nominee maydoes not have discretionary voting power with respect to ProposalProposals No. 1 through 3, to be considered at this meeting. You may not vote shares held in street name at the Annual Meeting unless you obtain a legal proxy from that organizationthe broker holding your account.
Can I change my vote after I have voted?
Yes.
If your shares are held by your broker, bank, or other agent, you should follow
HowAnnual Meeting. The final voting results will be reported on Form 8-K to the Securities and when may I submit a shareholder proposal forExchange Commission within four business days of the 2020 Annual Meeting of Shareholders?Meeting.
Whether or not you want us to include a proposal in our proxy statement, you must give written notice of the proposal to our Corporate Secretary no later than 5 days before the scheduled date of our 20202025 Annual Meeting.
the close of business on March 6, 2020.February 22, 2025. Pursuant to SEC Rule 14a-4(c)(2), if we receive timely notice of a proposal, our management proxies may still exercise discretion to vote on a matter if permitted by that rule and if we include in our proxy statement for the meeting a description of the matter and how the management proxies intend to exercise their discretion to vote.
corporate governance is to promote maximizing shareholder value in a manner consistent with legal requirements and the highest standards of integrity. The Board has adopted and adheres to corporate governance practices which the Board and senior management believe promote this purpose, are sound and represent best practices. We will bearcontinually review these governance practices, Pennsylvania law (the state in which we are incorporated), the entire costrules and listing standards of the solicitationNasdaq Stock Market and SEC regulations, as well as best practices suggested by recognized governance authorities.
How can I find out the resultsbusiness of the voting atCorporation;
Preliminary voting results will be announced at
What is the recommendation of the Board of Directors?
If you are the record holder of your shares and return your proxy card, unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote in accordance with the recommendations of the Board of Directors.
Theour Board. Our Board of Directors recommends a vote "FOR" Proposal No. 1, to elect George C. Collier, Robert T. Holland,determined that the following directors were not independent within the meaning of the rules and listing standards of the Nasdaq Stock Market: Christopher J. Annas, Chairman, President and Chief Executive Officer of the Corporation, and Denise Lindsay, Executive Vice President and Chief Financial Officer of the Corporation.
affiliates.
As of April 10, 2019, Meridian had 6,406,996 shares of common stock issued and outstanding.
otherwise indicated, the address for each shareholder listed below is c/o Meridian Corporation, 9 Old Lincoln Highway, Malvern, Pennsylvania 19335.
Name of Beneficial Owner | Amount and Nature of Beneficial Ownership(1)(2)(3) | Percentage of Class | |||||
---|---|---|---|---|---|---|---|
Christopher J. Annas | 255,592 | 3.99 | % | ||||
Joseph L. Cafarchio | 13,559 | 0.21 | % | ||||
Robert M. Casciato | 72,016 | 1.12 | % | ||||
George C. Collier | 9,157 | 0.14 | % | ||||
Robert T. Holland | 26,213 | 0.41 | % | ||||
Edward J. Hollin | 22,300 | 0.35 | % | ||||
Anthony Imbesi(4) | 183,194 | 2.86 | % | ||||
Charles D. Kochka | 10,366 | 0.16 | % | ||||
Denise Lindsay | 37,856 | 0.59 | % | ||||
Randy J. McGarry | 2,000 | 0.03 | % | ||||
Kenneth H. Slack | 31,734 | 0.50 | % | ||||
Current Directors, Nominees & Executive Officer as a Group (11 persons) | 663,987 | 10.36 | % | ||||
Principal Shareholders (not otherwise named above) | |||||||
Basswood Capital Management, LLC(5) | 612,310 | * | 9.56 | % | |||
The Banc Funds Company, LLC(6) | 451,516 | * | 7.05 | % | |||
EJF Capital LLC(7) | 363,905 | * | 5.68 | % | |||
Ategra Capital Management(8) | 324,594 | * | 5.07 | % |
Board Diversity Matrix as of March 27, 2024 | | ||||||||||||
Total Number of Directors | | | 8 | | |||||||||
| | | Female | | | Male | | ||||||
Directors | | | | | 2 | | | | | | 6 | | |
Number of Directors who identify in Any of the Categories Below: | | | | ||||||||||
African American or Black | | | | | — | | | | | | — | | |
Alaskan Native or Native American | | | | | — | | | | | | — | | |
Asian | | | | | — | | | | | | — | | |
Hispanic or Latinx | | | | | — | | | | | | — | | |
Native Hawaiian or Pacific Islander | | | | | — | | | | | | — | | |
White | | | | | 2 | | | | | | 5 | | |
Two or More Races or Ethnicities | | | | | — | | | | | | — | | |
LGBTQ+ | | | | | — | | | | | | — | | |
Did not Disclose Demographic Background | | | 1 | |
The
number of directors to be elected, shall be elected
2027:
Accountant and member of the AICPA and PICPA. Mr. Holland has served as a director of the Corporation since 2004. The Board believes that Mr. Holland'sHolland’s extensive managerial experience, including his financial accounting background and experience, provides the qualifications and skills for him to serve as a Meridian Corporation director.
Denise Lindsay (Age 52)—Ms. Lindsay is the Executive Vice President and Chief Financial Officer of the Corporation. Ms. Lindsay is responsible for financial reporting, investor relations, risk management, asset-liability management, treasury, forecasting and budgeting. Before joining the Corporation, Ms. Lindsay was the Vice President and Controller of DNB First from 1992 to 2004. Prior to that time she was a Senior Accountant for KPMG, LLP. Ms. Lindsay serves as Chairman of the Board of Advisors for the Upper Main Line YMCA and in that capacity also serves on the Board of the YMCA of Greater Brandywine. Ms. Lindsay is a former member of the Advisory Board of the Federal Home Loan Bank—Philadelphia region. Ms. Lindsay has over 25 years' experience in bank financial management, is a Certified Public Accountant, a member of the Financial Managers Society and PICPA as well as a member of the Women in Banking Committee of the Pennsylvania Bankers Association. Ms. Lindsay has served as a director of the Corporation since 2009. The Board believes that Ms. Lindsay's financial, business and public accounting experience, as well as her career in banking, provides the qualifications and skills for her to serve as a Meridian Corporation director.
Directors Continuing in Office
Christopher J. Annas (Age 63)—Mr. Annas is the founder, Chairman, President and CEO of the Corporation. Prior to starting Meridian, Mr. Annas was the President, CEO and co-founder of Stonebridge Bank, West Chester, PA. Mr. Annas has over 30 years of banking experience in various commercial lending capacities. Prior to Stonebridge, Mr. Annas served as Regional Vice President for Summit Bank, leading the small business lending effort in the Delaware Valley. During his tenure at Summit Bank, he managed their large corporate lending effort in Pennsylvania and Southern New Jersey, as well as their media communications business nationally. Mr. Annas currently serves on the Foundation Board of Paoli Hospital and on the Community Bank Council of the American Bankers Association. He is a former board member of the Chester County Chamber of Business and Industry and former board member of the Peoples Light and Theatre. Mr. Annas has served as a director of the Corporation since 2004. The Board believes that Mr. Annas' career in banking, including his position as Chairman, President and CEO of the Corporation, gives him the qualifications and skills to serve as a Meridian Corporation director.
Robert M. Casciato (Age 67)—Mr. Casciato is a founding partner of Alliance Environmental Systems, Inc., a West Chester company that was established in 1994. Alliance Environmental provides environmental remediation, selective demolition, structural demolition and asbestos abatement in the Mid-Atlantic region. Alliance was named Business of the Year in 2003 by the Chamber of Commerce of Greater West Chester. Mr. Casciato is also a partner in the RMC/SDI Real Estate Partnership, located in West Chester, specializing in brownfields redevelopment in Chester County. Mr. Casciato is the past Treasurer of the French and Pickering Creeks Conservation Trust. Mr. Casciato has served as a director of the Corporation since 2004. The Board believes that Mr. Casciato's expertise in environmental matters and the real estate industry, along with his years of service as a director of the Corporation, provides the qualifications and skills for him to serve as a Meridian Corporation director.
Foundation, One Independence Place Condominium Association, the Chester County Industrial and Investment Council, and is the former solicitor for and a member of the executive committee of South Eastern Economic
Kenneth H. Slack
Name of Beneficial Owner | | | Amount and Nature of Beneficial Ownership(1)(2) | | | Percentage of Class(9) | | ||||||
Christopher J. Annas | | | | | 594,128 | | | | | | 5.20% | | |
Robert M. Casciato | | | | | 214,496 | | | | | | 1.92% | | |
George C. Collier | | | | | 67,536 | | | | | | 0.60% | | |
Christine M. Helmig | | | | | 3,266 | | | | | | 0.03% | | |
Robert T. Holland | | | | | 86,953 | | | | | | 0.78% | | |
Edward J. Hollin | | | | | 50,726 | | | | | | 0.45% | | |
Anthony M. Imbesi(3) | | | | | 385,134 | | | | | | 3.44% | | |
Charles D. Kochka | | | | | 60,450 | | | | | | 0.54% | | |
Denise Lindsay | | | | | 157,380 | | | | | | 1.40% | | |
Current Directors, Nominees & Executive Officer as a Group (11 persons) | | | | | 1,620,069 | | | | | | 14.03% | | |
Meridian Bank Employee Stock Ownership Plan(4) | | | | | 610,735 | | | | | | 5.46% | | |
Principal Shareholders (not otherwise named above) | | | | | | | | | | | | | |
Fourthstone, LLC(5) | | | | | 1,035,631 | | | | | | 9.26% | | |
Ategra Capital Management, LLC(6) | | | | | 992,956 | | | | | | 8.88% | | |
The Banc Funds Company, LLC(7) | | | | | 782,678* | | | | | | 7.00% | | |
Strategic Value Bank Partners, LLC(8) | | | | | 651,298* | | | | | | 5.82% | | |
Joseph L. Cafarchio (Age 62)—Mr. Cafarchio is the Executive Vice President and Chief Credit Officerinstructions of the Corporation,participants. Any unallocated shares and unvoted allocated shares are voted by the plan trustee. The amount of our common stock beneficially owned by officers who serve as plan trustees and by all directors and executive officers as a position he hasgroup, does not include the shares held since January 2017. Mr. Cafarchioby the plan trust other than shares specifically allocated to the individual officer’s account.
Charles D. Kochka (Age 62)—Mr. Kochka is the Executive Vice President and Chief Lending Officeraggregate of the Corporation. Mr. Kochka is responsible for all commercial and consumer lending in the Corporation. Mr. Kochka started at Meridian Corporation in 2010 and has more than 38 years' experience in commercial lending in the Delaware Valley. He graduated from Bucknell University in 1978 with a Bachelortotal number of Arts degree in Economics. He currently volunteers for Seedcopa, where he sits on the Executive Committee and Loan Review Committee, and for the United Way of Chester County, where he is a Director and past Board Chair. He has also the former Board Chairmeetings of the West Chester YMCA.
Randy J. McGarry (Age 51)—Mr. McGarry is the Chief Information Officer of the Corporation, responsible for executing technology and operational solutions aligned with corporate strategy. Prior to joining Meridian, Mr. McGarry was Managing Director at Automated Financial Systems in Exton, PA. Mr. McGarry has over 25 years of banking experience with expertise in IT strategy, technology architecture, network infrastructure, core system conversions and merger & acquisitions. Prior to Automated Financial Systems, Mr. McGarry served as an executive for Fox Chase Bank and Harleysville National Corporation and spent numerous years as the Chief Information Officer and Chief Operations Officer at Republic First Bancorp where he began his career in banking. Throughout his career, Mr. McGarry has led technology & operation teams to increase efficiencies, maximize resources and improve the customer experience. Mr. McGarry holds a Wharton Leadership Certificate from the ABA Stonier Graduate School of Banking, an MBA in Management Information Systems from Drexel University and a BS in Finance from Pennsylvania State University. Mr. McGarry is a member of the Greater Philadelphia Senior Executive Group and the Society for Information Management.
Our Board of Directors believes that(held for the purpose of corporate governance is to promote maximizing shareholder value inperiod for which he or she has served as a manner consistent with legal requirementsdirector) and the highest standardstotal number of integrity. The Board has adopted and adheres to corporate governance practices which the Board and senior management believe promote this purpose, are sound and represent best practices. We continually review these governance practices, Pennsylvania law (the state in which we are incorporated), the rules and listing standards of the Nasdaq Stock Market and SEC regulations, as well as best practices suggestedmeetings held by recognized governance authorities.
The structure of the Corporation's Board leadership consists of a non-independent Chairman and Chief Executive Officer, Christopher Annas, the Board's Lead Independent Director, Robert T. Holland, and a majority of independent non-employee directors. The independent directorsall committees of the Board meet separately in Executive Session after each regularly scheduled Board of Directors meeting without management present. Additionally,on which he or she served (during the periods that he or she served).
The Corporation's Lead Independent Director is appointed for a term of two years and, in consultation with the other independent directors, is responsible for:
Currently, our Board of Directors has 8 members. Under the rules adopted by the Securities and Exchange Commission (SEC) and Nasdaq Stock Market for independence, Robert M. Casciato, George C. Collier, Robert T. Holland, Edward J. Hollin, Anthony M. Imbesi and Kenneth H. Slack meet the standards for independence. These directors represent more than a majority of our Board of Directors.
Our Board of Directors determined that the following directors were not independent within the meaning of the rules and listing standards of the Nasdaq Stock Market: Christopher J. Annas, Chairman, President and Chief Executive Officer of the Corporation, and Denise Lindsay, Executive Vice President and Chief Financial Officer of the Corporation.
Our Board of Directors has determined that a lending relationship resulting from a loan made by the Corporation to a director would not affect the determination of independence if the loan complies with Regulation O under the federal banking laws. Our Board of Directors also determined that maintaining with the Corporation a deposit, savings or similar account by a director or any of the director's affiliates would not affect the determination of independence if the account is maintained on the same terms and conditions as those available to similarly situated customers. Additional categories or types of transactions or relationships considered by our Board of Directors regarding director independence include, but are not limited to, vendor or contractual relationships with directors or their affiliates.
MEETINGS OF THE BOARD AND ITS COMMITTEES
Loan Committee.. The members of the Loan Committee are: Christopher Annas, Joseph Cafarchio, Robert Casciato, Robert Holland, and Edward Hollin, and Kenneth Slack.Hollin. Mr. Casciato is Chair of the committee. During 2018,2023, the committee met twelve times.
Governance and Nominating Committee. The Governance and Nominating Committee is comprised of all of the independent directors of the Board as it is the intention that this committee, as a whole, will be responsible for making recommendations regarding candidates for directorships and the size and composition of the Board. During 2023 the committee met 4 times. The Governance & Nominating Committee is comprised of members who satisfy the applicable independence requirements of NASDAQ.
Quarterly Board Fees: | | | | | | | |
Retainer (all members) | | | | $ | 10,400 | | |
Lead Independent Director | | | | | 3,100 | | |
Committee Chair | | | | | 2,100 | | |
Committee members (non-chair): | | | | | 1,600 | | |
Director | | | Fees Earned or Paid in Cash | | |||
Robert M. Casciato | | | | $ | 50,000 | | |
George C. Collier | | | | | 48,000 | | |
Christine M. Helmig | | | | | 48,000 | | |
Robert T. Holland | | | | | 75,200 | | |
Edward J. Hollin | | | | | 53,900 | | |
Anthony M. Imbesi | | | | | 56,900 | | |
During 2018,all asset and liability management policies, procedures, and strategies to the fullmanagement Asset/Liability Committee (ALCO). ALCO is comprised of various members of Senior Management, Department Leaders, Compliance, Internal Audit and Risk Management and meet monthly. ALCO is responsible for interpreting the longer range objectives established by the Board met 13 times.
All current directors attended at least 75%of Directors and managing day-to-day oversight of the aggregaterisk management function. As such the ALCO set basic direction for the bank’s sources and uses of funds, establishes numerical ranges for primary and secondary objectives and monitors risk and the delivery of services.
The Corporation has no specific policy requiring directors to attend the Annual Meeting; however, director attendance is strongly encouraged. All current membersAudit Committee of the Board of Directors. At least annually, the BSA risk assessment is reviewed and approved by the Board of Directors. Risk is rarely static, and thus frequent review and additional approvals may be necessary. The risk assessments focus on risk factors due to the Bank’s size, market presence, types of customers, types of products, geographic locations, method of account opening, transaction type, and business line. All are incorporated into BSA/AML software to aid in the monitoring and reporting requirements.
Chief Technology Officer the responsibility for overall management of Information Technology risk. IT risk focuses on information and information systems, especially the most critical and vital information assets. Without reliable and properly secured information systems, business operations could be severely disrupted. Likewise, the preservation and enhancement of the Corporation’s reputation is directly linked to the way in which both information and information systems are managed. Maintaining an adequate level of security is one of several important aspects of managing IT risk. The Chief Technology Officer, along with the IT Security Officer, report to the Board monthly on the status of the Information Security Program.
for purposes of each of the above stated guidelines, the Board of Directors must affirmatively determine that the directors on the Audit Committee do not, among other things, accept any consulting, advisory, or other
and the SEC.
In reliance on the reviews and discussions referred to above, the Committee recommended to the Board of Directors (and the Board has approved) that the audited consolidated financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2018,2023, for filing with the SEC.
the period he served.
| • Net income (millions) | | | | $ | 13.24 | | |
| • Earnings per diluted share | | | | $ | 1.19 | | |
| • Return on average assets | | | | | 0.61% | | |
| • Return on average equity | | | | | 8.53% | | |
| • Net interest margin | | | | | 3.35% | | |
Set forth belowother benefits. Potential compensation is aligned with the competitive market and actual cash compensation is designed to vary dependent on performance. We utilize a descriptionbalance of fixed and variable pay components and cash and equity to determine our pay. Our compensation program for the named executive officersis designed to support our business strategies, align pay with our performance and reinforce sound compensation governance. The table below gives an explanation and analysisoverview of the material elementscompensation components used in our program and matches each with one or more of their compensation.
the objectives described above.
Compensation Component | | | Description of Component | |
Base Salary | | | Provides a competitive level of fixed income based on role, experience and individual performance. | |
Annual Incentive Plan | | | Motivates and rewards executives for performance on key financial, operational and individual objectives in support of our annual business plan and broader corporate strategies. Rewards vary based on performance. | |
Equity Awards | | | Aligns executives’ interests with those of shareholders through equity-based compensation. Rewards executives for long-term shareholder value creation. Encourages retention through multiple year vesting. | |
Other Benefits | | | Provides a base level of competitive compensation for executive talent. | |
Retirement Benefits | | | The Supplemental Executive Retirement Plan (the “SERP”) provides long term compensation for our NEOs while its vesting provisions help ensure that the Company will continue to receive the benefit of their service. | |
Severance/Change in Control Agreements | | | Focuses executives on company performance and transactions that are in the best interests of shareholders, regardless of the impact such transactions may have on the executive’s employment | |
Employments contracts | | | Provides employment security to key executives. | |
compensation programs.
Executive | | | 2022 Base Salary | | | 2023 Base Salary | | | % Increase | | |||||||||
Christopher J. Annas | | | | $ | 516,000 | | | | | $ | 537,000 | | | | | | 4.1% | | |
Denise Lindsay | | | | $ | 300,000 | | | | | $ | 309,000 | | | | | | 3.0% | | |
Charles Kochka(1) | | | | $ | 240,500 | | | | | $ | 247,800 | | | | | | 3.0% | | |
Executive | | | Target Aggregate Incentive Opportunity | | |||
Christopher J. Annas | | | | | 75% | | |
Denise Lindsay | | | | | 65% | | |
Meridian
year-to-year based on the level and role, the contribution of the executive during the year as well as both individual and BankCorporate performance. Awards are based on attaining pre-established corporate goals and Committee review of individual performance and recommendationsbased on subjective goals.
Performance Measure | | | 2023 Performance Measure | | | Result | | | Performance Payout vs Target | | ||||||
Commercial loan growth at December 31, 2023 compared to 2022 | | | | | >12% | | | | | | 9% | | | | <= 75% | |
Return on average equity, year ended December 31, 2023 | | | | | >12% | | | | | | 8.5% | | | | <=71% | |
leadership.
Executive | | | Target Incentive Earned | | | Discretionary Award | | | 2023 Actual Annual Incentive Award | | | 2023 Actual as % of Salary | | ||||||||||||
Christopher J. Annas | | | | $ | 294,008 | | | | | $ | 55,992 | | | | | $ | 350,000 | | | | | | 65% | | |
Denise Lindsay | | | | | 146,621 | | | | | | 28,379 | | | | | | 175,000 | | | | | | 57% | | |
Charles Kochka(1) | | | | | — | | | | | | 30,000 | | | | | | 30,000 | | | | | | 12% | | |
| | | Stock Options | | |||||||||
Executive | | | # Shares | | | Grant Value ($) | | ||||||
Christopher J. Annas | | | | | 20,000 | | | | | $ | 46,800 | | |
Denise Lindsay | | | | | 10,000 | | | | | | 23,400 | | |
fixed income account.
EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)
Year | | | Summary Compensation Table Total For PEO ($)(1) | | | Compensation Actually Paid to PEO ($)(1) | | | Average Summary Compensation Table Total for Non-PEO NEOs ($)(2) | | | Average Compensation Actually Paid to Non-PEO NEOs (S)(2) | | | Value of Initial Fixed $100 Investment Based on: Total Shareholder Return ($) | | | Net Income (In Millions $) | | | Return on Average Equity | | |||||||||||||||||||||
2023 | | | | $ | 1,019,076 | | | | | $ | 855,330 | | | | | $ | 489,567 | | | | | $ | 437,590 | | | | | $ | 95 | | | | | $ | 13.2 | | | | | | 8.53% | | |
2022 | | | | | 1,300,325 | | | | | | 1,304,148 | | | | | | 437,882 | | | | | | 413,505 | | | | | | 87 | | | | | | 21.8 | | | | | | 13.87% | | |
2021 | | | | | 2,186,398 | | | | | | 2,167,986 | | | | | | 558,896 | | | | | | 556,403 | | | | | | 190 | | | | | | 26.4 | | | | | | 21.33% | | |
| | | 2023 | | | 2022 | | | 2021 | | |||||||||||||||||||||||||||
| | | Non-PEO | | | Non-PEO | | | Non-PEO | | |||||||||||||||||||||||||||
| | | PEO ($) | | | NEOs ($) | | | PEO ($) | | | NEOs ($) | | | PEO ($) | | | NEOs ($) | | ||||||||||||||||||
Summary Compensation Table Total | | | | $ | 1,019,076 | | | | | $ | 489,567 | | | | | $ | 1,300,325 | | | | | $ | 437,882 | | | | | $ | 2,186,398 | | | | | $ | 558,896 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Less: Grant date value of equity awards | | | | | (196,855) | | | | | | (63,852) | | | | | | (284,126) | | | | | | (91,183) | | | | | | (192,255) | | | | | | (71,135) | | |
Year-end fair value of current year awards, unvested | | | | | 34,950 | | | | | | 8,738 | | | | | | 223,350 | | | | | | 48,132 | | | | | | 130,905 | | | | | | 52,768 | | |
Fair value of awards granted and vested in current year | | | | | 11,700 | | | | | | 2,925 | | | | | | 58,145 | | | | | | 16,801 | | | | | | 45,465 | | | | | | 16,742 | | |
Year-over-year change in fair value of awards granted prior to year that were unvested at year-end | | | | | (39,820) | | | | | | (4,596) | | | | | | 11,805 | | | | | | 4,649 | | | | | | (911) | | | | | | (342) | | |
Year-over-year change in fair value of awards granted prior to year that vested during the current year | | | | | 26,279 | | | | | | 4,808 | | | | | | (5,351) | | | | | | (2,776) | | | | | | (1,616) | | | | | | (526) | | |
Compensation Actually Paid | | | | $ | 855,330 | | | | | $ | 437,590 | | | | | $ | 1,304,148 | | | | | $ | 413,505 | | | | | $ | 2,167,986 | | | | | $ | 556,403 | | |
Name and Principal Position | | | Year | | | Salary | | | Bonus ($) | | | Option Awards(10) | | | All Other Compensation | | | Total | | ||||||||||||||||||
Christopher Annas – Chairman, President and CEO | | | | | 2023 | | | | | $ | 537,000 | | | | | $ | 250,000(1) | | | | | $ | 46,800 | | | | | $ | 185,276 | | | | | $ | 1,019,076 | | |
| | | 2022 | | | | | | 516,000 | | | | | | 400,000(2) | | | | | | 232,580 | | | | | | 151,745 | | | | | | 1,300,325 | | | ||
| | | 2021 | | | | | | 489,000 | | | | | | 1,350,000(3) | | | | | | 191,340 | | | | | | 156,058 | | | | | | 2,186,398 | | | ||
Denise Lindsay – Chief Financial Officer and EVP | | | | | 2023 | | | | | | 309,000 | | | | | | 235,000(4) | | | | | | 23,400 | | | | | | 66,914 | | | | | | 634,314 | | |
| | | 2022 | | | | | | 300,000 | | | | | | 250,000(5) | | | | | | 95,499 | | | | | | 57,738 | | | | | | 703,237 | | | ||
| | | 2021 | | | | | | 267,800 | | | | | | 375,000(6) | | | | | | 86,103 | | | | | | 65,036 | | | | | | 793,939 | | | ||
Charlie Kochka – Chief Lending Officer and EVP(11) | | | | | 2023 | | | | | | 247,800 | | | | | | 45,000(7) | | | | | | — | | | | | | 52,019 | | | | | | 344,819 | | |
| | | 2022 | | | | | | 240,500 | | | | | | 25,000(8) | | | | | | 53,055 | | | | | | 51,188 | | | | | | 369,743 | | | ||
| | | 2021 | | | | | | 233,500 | | | | | | 100,000(9) | | | | | | 57,402 | | | | | | 55,889 | | | | | | 446,791 | | |
Name | | | Year | | | Perquisites & Other Personal Benefits(1) ($) | | | Insurance Premiums ($) | | | Company 401(k)/ESOP/ SERP Contributions ($) | | | Total ($) | | |||||||||||||||
Christopher Annas | | | | | 2023 | | | | | $ | 50,599 | | | | | $ | 14,479 | | | | | $ | 120,198 | | | | | $ | 185,276 | | |
| | | 2022 | | | | | | 29,565 | | | | | | 12,746 | | | | | | 109,434 | | | | | | 151,745 | | | ||
| | | 2021 | | | | | | 38,401 | | | | | | 11,559 | | | | | | 106,098 | | | | | | 156,058 | | | ||
Denise Lindsay | | | | | 2023 | | | | | | 3,600 | | | | | | 15,418 | | | | | | 47,896 | | | | | | 66,914 | | |
| | | 2022 | | | | | | 3,600 | | | | | | 15,154 | | | | | | 38,984 | | | | | | 57,738 | | | ||
| | | 2021 | | | | | | 3,600 | | | | | | 17,401 | | | | | | 44,035 | | | | | | 65,036 | | | ||
Charles Kochka(2) | | | | | 2023 | | | | | | — | | | | | | 16,534 | | | | | | 35,485 | | | | | | 52,019 | | |
| | | 2022 | | | | | | — | | | | | | 16,998 | | | | | | 34,190 | | | | | | 51,188 | | | ||
| | | 2021 | | | | | | 346 | | | | | | 16,966 | | | | | | 38,577 | | | | | | 55,889 | | |
Name | | | Number of Securities Underlying Unexercised Options Exercisable (#) | | | Number of Securities Underlying Unexercised Options Unexercisable(1) (#) | | | | | | Option Exercise Price ($) | | | Option Expiration Date | | ||||||||||||
Chris Annas | | | | | 10,750 | | | | | | — | | | | | | | | $ | 7.14 | | | | | | 9/15/2025 | | |
| | | 42,000 | | | | | | — | | | | | | | | $ | 7.62 | | | | | | 6/15/2026 | | | ||
| | | 20,000 | | | | | | — | | | | | | | | $ | 9.50 | | | | | | 7/27/2027 | | | ||
| | | 30,000 | | | | | | — | | | | | | | | $ | 8.90 | | | | | | 5/24/2028 | | | ||
| | | 30,000 | | | | | | — | | | | | | | | $ | 8.50 | | | | | | 6/3/2029 | | | ||
| | | 30,000 | | | | | | — | | | | | | | | $ | 9.00 | | | | | | 11/4/2030 | | | ||
| | | 30,000 | | | | | | 10,000 | | | | (a) | | | | $ | 13.18 | | | | | | 2/25/2031 | | | ||
| | | 20,000 | | | | | | 20,000 | | | | (b) | | | | $ | 17.76 | | | | | | 2/28/2032 | | | ||
| | | 5,000 | | | | | | 15,000 | | | | (e) | | | | $ | 10.00 | | | | | | 11/01/2033 | | | ||
Denise Lindsay | | | | | 10,000 | | | | | | — | | | | | | | | $ | 9.50 | | | | | | 7/27/2027 | | |
| | | 15,000 | | | | | | — | | | | | | | | $ | 8.90 | | | | | | 5/24/2028 | | | ||
| | | 7,880 | | | | | | — | | | | | | | | $ | 8.50 | | | | | | 6/3/2029 | | | ||
| | | 15,000 | | | | | | — | | | | | | | | $ | 9.00 | | | | | | 11/4/2030 | | | ||
| | | 13,500 | | | | | | 4,500 | | | | (c) | | | | $ | 13.88 | | | | | | 5/21/2031 | | | ||
| | | 9,000 | | | | | | 9,000 | | | | (d) | | | | $ | 15.92 | | | | | | 8/22/2032 | | | ||
| | | 2,500 | | | | | | 7,500 | | | | (e) | | | | $ | 10.00 | | | | | | 11/01/2033 | | | ||
Charles Kochka | | | | | 2,500 | | | | | | — | | | | | | | | $ | 9.00 | | | | | | 11/4/2030 | | |
| | | 9,000 | | | | | | 3,000 | | | | (c) | | | | $ | 13.88 | | | | | | 5/21/2031 | | | ||
| | | 5,000 | | | | | | 5,000 | | | | (d) | | | | $ | 15.92 | | | | | | 8/22/2032 | | |
Ms. Lindsay may terminate her employment at any time upon 90 days'days’ written notice to the Corporation. The Corporation may terminate Ms. Lindsay'sLindsay’s employment for Cause, as defined, at any time. If Ms. Lindsay terminates for Good Reason or is terminated by the Corporation without Cause, before or after change in control, she is entitled to receive a lump sum equal to 200% of her base salary and performance bonus opportunity in effect as well as the replacement cost of any other benefits, including but not limited to medical, disability and life insurance. Under the employment agreement, Ms. Lindsay is subject to noncompetitionnon-competition and nonsolicitationnon-solicitation provisions that apply during the term of the employment agreement and for a period of up to one year following termination of employment.
The following table sets forth the compensation that the Corporation paid the named executive officers for the fiscal year ended December 31, 2018.
Name and Principal Position | Year | Salary | Bonus | Option Awards(1) | All Other Compensation | Total | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Christopher Annas—Chairman, | 2018 | $ | 431,904 | $ | 149,000 | $ | 32,775 | $ | 148,269 | $ | 761,948 | ||||||||
President and CEO of the | 2017 | $ | 425,000 | $ | 140,000 | $ | 13,919 | $ | 123,384 | $ | 702,613 | ||||||||
Corporation | |||||||||||||||||||
Denise Lindsay—Chief Financial | 2018 | $ | 235,997 | $ | 60,000 | $ | 16,388 | $ | 55,388 | $ | 367,773 | ||||||||
Officer and EVP of the | 2017 | $ | 220,000 | $ | 55,000 | $ | 6,959 | $ | 52,453 | $ | 334,422 | ||||||||
Corporation | |||||||||||||||||||
Joseph Cafarchio—Chief Credit | 2018 | $ | 200,473 | $ | 35,000 | $ | 10,925 | $ | 42,271 | $ | 288,669 | ||||||||
Officer and EVP of the | 2017 | $ | 190,550 | $ | 20,000 | $ | 3,245 | $ | 42,191 | $ | 255,986 | ||||||||
Corporation | |||||||||||||||||||
Charlie Kochka—Chief Lending | 2018 | $ | 186,683 | $ | 35,000 | $ | 10,925 | $ | 46,223 | $ | 278,831 | ||||||||
Officer and EVP of the | 2017 | $ | 175,000 | $ | 20,000 | $ | 3,245 | $ | 46,833 | $ | 245,078 | ||||||||
Corporation | |||||||||||||||||||
Randy McGarry—Chief Information | 2018 | $ | 49,615 | $ | 4,000 | $ | 5,950 | $ | 1,359 | $ | 60,924 | ||||||||
Officer and SVP of the | |||||||||||||||||||
Corporation(2) |
The following table sets forth for each of the Corporation's named executive officers information relating to payments that the Corporation made that are reflected in this column.
2018 ALL OTHER COMPENSATION TABLE
Name | Year | Perquisites & Other Personal Benefits(1) ($) | Insurance Premiums ($) | Company 401(k)/ESOP/ SERP Contributions ($) | Total ($) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Christopher Annas | 2018 | 39,309 | 17,192 | 91,768 | 148,269 | |||||||||||
2017 | 29,947 | 14,972 | 78,465 | 123,384 | ||||||||||||
Denise Lindsay | 2018 | 7,200 | 18,733 | 29,455 | 55,388 | |||||||||||
2017 | 3,600 | 20,905 | 27,948 | 52,453 | ||||||||||||
Joseph Cafarchio | 2018 | — | 16,662 | 25,609 | 42,271 | |||||||||||
2017 | — | 17,887 | 24,304 | 42,191 | ||||||||||||
Charles Kochka | 2018 | — | 19,496 | 26,727 | 46,223 | |||||||||||
2017 | — | 21,551 | 25,282 | 46,833 | ||||||||||||
Randy McGarry | 2018 | — | 1,359 | — | 1,359 |
The following table sets forth information on outstanding options and stock awards held by the named executive officers at December 31, 2018, including the number of shares underlying each stock option as well as the exercise price and the expiration date of each outstanding option.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLE
Option Awards | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable(1) (#) | Option Exercise Price ($) | Option Expiration Date | |||||||||
Christopher Annas | 21,000 | — | $ | 12.38 | 7/31/24 | ||||||||
7,875 | — | $ | 14.29 | 9/30/25 | |||||||||
15,750 | 5,250 (a) | $ | 15.24 | 6/15/26 | |||||||||
5,000 | 5,000 (b) | $ | 19.00 | 7/27/27 | |||||||||
3,750 | 11,250 (c) | $ | 17.80 | 5/24/28 | |||||||||
Denise Lindsay | 7,717 | — | $ | 11.79 | 4/1/23 | ||||||||
5,906 | 1,969 (a) | $ | 15.24 | 6/15/26 | |||||||||
2,500 | 2,500 (b) | $ | 19.00 | 7/27/27 | |||||||||
1,875 | 5,625 (c) | $ | 17.80 | 5/24/28 | |||||||||
Joseph Cafarchio | 4,410 | — | $ | 11.79 | 4/1/23 | ||||||||
1,575 | 525 (d) | $ | 15.24 | 3/4/26 | |||||||||
1,000 | 1,000 (e) | $ | 19.00 | 5/8/27 | |||||||||
1,250 | 3,750 (c) | $ | 17.80 | 5/24/28 | |||||||||
Charles Kochka | 2,756 | — | $ | 11.79 | 4/1/23 | ||||||||
787 | 263 (d) | $ | 15.24 | 3/4/26 | |||||||||
1,000 | 1,000 (e) | $ | 19.00 | 5/8/27 | |||||||||
1,250 | 3,750 (c) | $ | 17.80 | 5/24/28 | |||||||||
Randy McGarry | 1,000 | 3,000 (f) | $ | 17.20 | 10/1/28 |
The Corporation compensates its non-employee directors for their service on our Board. Directors who are employed by Meridian are not paid additional compensation for board or committee service. The Board establishesapprove the compensation of Meridian’s NEOs for 2023 as described in the Corporation's non-employee directors. Information relatingCompensation Discussion and Analysis and the tabular disclosures of the NEOs’ compensation in this Proxy Statement. This proposal, commonly known as a “say-on-pay” proposal, gives shareholders the opportunity to endorse or not endorse Meridian’s executive pay program. Because the shareholder vote is not binding, the outcome of this year’s vote, or any future vote, may not be construed as overruling any decision by Meridian’s Board or the Board Compensation Committee regarding executive compensation. Meridian is providing shareholders with this opportunity pursuant to Section 14A of the Securities Exchange Act.
Director | Fees Earned or Paid in Cash | Total | |||||
---|---|---|---|---|---|---|---|
Robert M. Casciato | $ | 28,000 | $ | 28,000 | |||
George C. Collier | $ | 21,250 | $ | 21,250 | |||
Robert T. Holland | $ | 51,250 | $ | 51,250 | |||
Edward J. Hollin | $ | 25,000 | $ | 25,000 | |||
Anthony M. Imbesi | $ | 25,000 | $ | 25,000 | |||
Kenneth H. Slack | $ | 45,000 | $ | 45,000 |
In addition to cash fees, non-employee directors were also eligible to receive compensation in the form of stock options under the Corporation's 2016 Equity Incentive Plan. No options were granted to outside directors in 2018. Directors receive periodic fees based on the following schedule:
Quarterly Fees: | Total | |||
---|---|---|---|---|
Retainer (all members) | $ | 4,000 | ||
Lead Independent Director | $ | 3,000 | ||
Audit Committee Chair | $ | 3,000 | ||
Loan Committee Chair | $ | 3,000 | ||
Compensation Committee Chair | $ | 2,000 | ||
Per-Meeting Attendance Fees (non-chair): | $ | 750 |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Corporation makes loans to executive officers and directorsdisclosure rules of the CorporationSEC, including the Compensation Discussion and Analysis and the Compensation Tables contained in the ordinary course of its business. These loans are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time the transactionthis Proxy Statement, is originated for comparable transactions with nonaffiliated persons, and do not involve more than the normal risk of collectability or present any other unfavorable features. Federal regulations prohibit the Corporation from making loans to executive officers and directors of the Corporation or the Corporation at terms more favorable than could be obtained by persons not affiliated with the Corporation or the Corporation. The Corporation's policy towards loans to executive officers and directors currently complies with this limitation. The aggregate outstanding balance of the loans to all executive officers, directors or their affiliates, at December hereby APPROVED.”
The Corporation has adopted an Ethics/Conflicts of Interest Policy for its directors, officers, employees, contractors, consultants, agents and any other persons who represent Meridian Corporation in the course of business. It is intended to promote honest and ethical conduct, full, fair and accurate reporting and compliance with laws, among other matters. A copy of the Ethics/Conflicts of Interest Policy is available on our website at www.meridianbanker.com.
PROPOSAL 23
PROPOSAL TO RATIFY THE APPOINTMENT OF KPMGCROWE LLP AS THE CORPORATION'SCORPORATION’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2019
2024
2023 and 2022.
| | | 2023 | | | 2022 | | ||||||
Audit fees(1) – Crowe LLP | | | | $ | 565,125 | | | | | $ | 412,500 | | |
Audit-Related fees – Crowe LLP | | | | | 30,000 | | | | | | 28,600 | | |
Total audit and audit-related fees | | | | $ | 595,125 | | | | | $ | 441,100 | | |
Tax fees – KPMG(2) | | | | | 85,000 | | | | | | 85,000 | | |
Total fees | | | | $ | 680,125 | | | | | $ | 526,100 | | |
| 2018 | 2017 | |||||
---|---|---|---|---|---|---|---|
Audit fees(1) | $ | 298,000 | $ | 525,000 | |||
Audit-Related fees | 35,000 | 32,500 | |||||
| | | | | | | |
Audit and audit-related fees | 333,000 | 557,500 | |||||
Tax fees(2) | 59,190 | 37,000 | |||||
All other fees | 1,780 | — | |||||
| | | | | | | |
Total fees | $ | 393,970 | $ | 594,500 | |||
| | | | | | | |
| | | | | | | |
| | | | | | | |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “"FOR"” THE RATIFICATION OF THE APPOINTMENT OF KPMGCROWE, LLP AS THE CORPORATION'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2019.
Section 16(a) of the Securities Exchange Act of 1934 requires the Corporation's officers and directors and persons who own more than 10% of the Corporation's common stock to file reports of ownership and changes in ownership with the SEC. Officers, directors and greater than 10% holders are required to furnish the Corporation with copies of all Section 16(a) forms they file. To the Board of Directors' knowledge, based solely on review of the copies of such reports furnished to the Corporation during the fiscal year ended December 31, 2018, no director, officer or beneficial owner of more than 10% of the Corporation's common stock failed to file on a timely basis any report required by Section 16(a) of the Exchange Act.
03Y7SC
2019
MMMMMMMMMMMM Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q + 1. To elect three (3) directors as “Class B” of the Board, to serve until 2022: 01 - Robert T. Holland 02 - Denise Lindsay 03 - George C. Collier Mark here to vote FOR all nominees Mark here to WITHHOLD vote from all nominees 01 02 03 For All EXCEPT - To withhold a vote for one or more nominees, mark the box to the left and the corresponding numbered box(es) to the right. For Against Abstain 2. To ratify the appointment of KPMG LLP as independent registered public accounting firm for 2019. Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. + 1 U P X 4 1 5 6 9 8 031J9C MMMMMMMMM B Authorized Signatures — This section must be completed for your vote to count. Please date and sign below. A Proposals — The Board of Directors recommend a vote FOR all the nominees listed and FOR Proposal 2. 2019 Annual Meeting Proxy Card
Important notice regarding the Internet availability of proxy materials for the Annual Meeting of Shareholders. The material is available at: www.edocumentview.com/MRBK q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q Notice of 2019 Annual Meeting of Shareholders Proxy Solicited by Board of Directors for Annual Meeting — May 23, 2019 Joseph L. Cafarchio and Edward J. Carpoletti, or any of them, each with the power of substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the powers which the undersigned would possess if personally present, at the Annual Meeting of Shareholders of Meridian Corporation to be held on May 23, 2019 or at any postponement or adjournment thereof. Shares represented by this proxy will be voted as directed by the shareholder. If no such directions are indicated, the Proxies will have authority to vote FOR the election of the Board of Directors and FOR item 2. In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting. (Items to be voted appear on reverse side) MERIDIAN CORPORATION