DIRECTOR COMPENSATIONBrenda Battey and Ruth McCloudMembersEach of Brenda Battey and Ruth McCloud serve in their respective positions pursuant to employment agreements (the “Executive Employment Agreements”) entered into with the Company and the Bank effective in May 2017 and subsequently amended in certain respects. The Executive Employment Agreements provided for an initial term of employment of three years, subject to annual one-year extensions by mutual agreement of the parties. The Executive Employment Agreements provide for the payment of an annual base salary, which is currently $265,000 for Ms. Battey, and $260,000 for Ms. McCloud, which are subject to annual review and possible increase by the Board. The Executive Employment Agreements also provide for participation in the Bank’s Employee Stock Ownership Plan, eligibility to receive equity-based awards pursuant to the Company’s 2018 Long-Term Incentive Plan of such types and in such amounts as are determined by the Board, and eligibility to participate in all employee benefit plans applicable to senior executive officers, including the Bank’s Incentive Plan, the Company’s 401(k) plan (with continuation of the Company’s employee contribution matching policy as of the effective date of the employment agreements), and medical, dental, life and long-term disability programs.
Each Executive Employment Agreement may be terminated by the Company with or without Cause (including failure by the Company to request an annual extension of an agreement’s term) and following the Merger may be terminated by the executive for any reason and will also terminate in the event of the death or Disability (as defined in the Executive Employment Agreement) of the executive. “Cause” is defined in each Executive Employment Agreement to include the executive’s failure substantially to perform her duties, or material breach by her of her employment agreement or any material written policy of the Company, in each case if not cured within 30 days after notice from the Board requiring such cure; willful violation of any law, rule or regulation (excluding traffic violations and similar offenses); entry of a final regulatory cease and desist order against her; and other offenses involving fraud, moral turpitude, or dishonesty involving personal profit.
In the event of any termination of employment by the Company of the executive’s employment (excluding a termination of employment for Cause), or any termination by the executive, the executive would be entitled to receive all amounts accrued for payment to her to the date of termination and not previously paid, including base salary, unreimbursed business expenses, vested amounts under the Company’s 401(k) Plan and other employee benefit plans (collectively, the “Accrued Obligations”). The executive would also be entitled to continue to receive an amount equal to her monthly base salary for a specified period (the “Severance Period”) and would continue during the Severance Period to be entitled to receive her automobile allowance and payment by the Company of her life, long-term disability, medical and dental insurance premiums provided for in her employment agreement (such payments during the Severance Period being collectively referred to as the “Severance Payments”). The Severance Periods specified in the Executive Employment Agreements are 24 months for Ms. Battey, and 18 months for Ms. McCloud. In the event of termination of employment for Cause or due to death, the executive’s estate would only be entitled to receive payment of the Accrued Obligations.
Each Executive Employment Agreement provides that if the executive’s employment is terminated by the Company without Cause, or by the executive for any reason, within two years after a Change in Control of the Company has occurred, she will be entitled to receive a single lump sum payment equal to the present value of the Severance Payments described above, subject to execution of a general release. The present value of the Severance Payments would be calculated using the Applicable Federal Rate published by the Internal Revenue Service from time to time. “Change in Control” is defined in each Executive Employment Agreement to include: events that would be required to be reported as such pursuant to the Exchange Act or federal banking laws and regulations; any person or entity acquiring beneficial ownership of 50% or more of the Company’s outstanding securities; and changes in the composition of the Board do not receive separate compensation for their service on the Bank’s Board of Directors.
For the year ended December 31, 2020, each memberthat result, with certain exceptions, in directors who were members of the Board received $1,000 per meeting for attending monthly and special board meetings. The Chairmanas of the Board received an additional annual retainereffective date of $10,000. Committee members received an additional annual retainerthe employment agreements ceasing to constitute a majority of $8,000 and Committee Chairpersons received an additional annual retainerthe Board.
Each Executive Employment Agreement contains post-employment non-solicitation provisions pursuant to which, for a period of $6,000 for such service, except fortwelve months following termination the Corporate Governance Committee Chair, who received an additional annual retainer of $4,000.
On April 21, 2021, the Board approved revised compensation terms for non-employee directors. Under the new terms, each non-employee director will receive an annual award of unrestricted shares of common stockexecutive is prohibited from (i) attempting to influence any customer of the Company valued at $7,500. The non-employee Chairor the Bank to discontinue use of the Board will receiveCompany’s or the Bank’s services, or (ii) attempting to disrupt the relationship between the Company or the Bank and any of their respective employees, customers or other persons having specified relationships with the Company or the Bank.
Wayne-Kent Bradshaw and Norman Bellefeuille
Mr. Bradshaw and Mr. Bellefeuille are each party to an annual cash leadership retainer of $10,000, payable quarterly in installments of $2,500 per quarter. The Lead Independent Director will receive an annual cash retainer of $9,000, payable quarterly in installments of $2,250 per quarter. All other non-employee directors will receive an annual retainer of $8,000, payable quarterly in installments of $2,000. The Chair of each ofemployment agreement with the Audit Committee, the Compensation and Benefits Committee, the Corporate Governance Committee, the Risk and Compliance Committee, the Internal Asset Review Committee,Company and the Directors Loan Committee shall receive anBank that have substantially similar terms to the Executive Employment Agreements, except with respect to annual cash retainer of $6,000, payable quarterly in installments of $1,500. Each non-employee director shall receive a Board meeting fee of $1,000 for attendance at each regular meeting and duly-called special meeting of the Board, and will be paid a fee of $1,000 in August whether or not a meeting is held in August. In addition, each non-employee director shall receive an annual Committee Service Fee of $8,000, payable quarterly in installments of $2,000. No Director shall receive a payment in respect of any meeting that the Director does not attend, or any meeting that is cancelled.base
The following table summarizes the compensation paid to non-employee directors for the year ended December 31, 2020.
Robert C. Davidson | | | $35,000 | | | $7,500 | | | $578 | | | $43,078 |
Daniel Medina* | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Virgil Roberts* | | | $37,000 | | | $7,500 | | | — | | | $44,500 |
Dutch C. Ross III | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Erin Selleck* | | | $29,000 | | | $7,500 | | | — | | | $36,500 |
Jack T. Thompson | | | $23,000 | | | $7,500 | | | — | | | $30,500 |
*
| Former director whose position was terminated upon the closing of the Merger. |
(1)
| Includes payments of annual retainer fees, fees paid to chairpersons and members of Board committees, and meeting attendance fees. |
(2)
| The amounts shown reflect the aggregate fair value of stock awards of 5,155 shares of Broadway’s Voting Common Stock to each Director on the grant date of February 26, 2020, as determined in accordance with FASB ASC Topic 718. |
(3)
| Includes premiums paid for dental and vision insurance. |