Tuesday, April 12, 2022


Type DEF 14A SUMMIT FINANCIAL GROUP, For: Might 19

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Assertion Pursuant to Part 14(a) of the Securities

Alternate Act of 1934

Filed by the Registrant þ

Filed by a Get together aside from the Registrant o

Examine the suitable field:

r Preliminary Proxy Assertion
r Confidential, for Use of the Fee Solely (as permitted by Rule 14a-6(e)(2))
þ Definitive Proxy Assertion
r Definitive Extra Supplies
r Soliciting Materials Below Part 240.14a-12

Summit Monetary Group, Inc.

(Title of Registrant as Specified In Its Constitution)

(Title of Individual(s) Submitting Proxy Assertion, if Different Than the Registrant)

Cost of Submitting Charge (Examine the suitable field):

þ No price required.

o Charge computed on desk under per Alternate Act Guidelines 14a-6(i)(1) and 0-11.
1) Title of every class of securities to which transaction applies:
2) Combination variety of securities to which transaction applies:
3) Per unit worth or different underlying worth of transaction computed pursuant to Alternate Act Rule 0-11 (set forth the quantity on which the submitting price is calculated and state the way it was decided):
4) Proposed most mixture worth of transaction:
5) Whole price paid:

o Charge paid beforehand with preliminary supplies.
o Examine field if any a part of the price is offset as offered by Alternate Act Rule 0-11(a)(2) and determine the submitting for which the offsetting price was paid beforehand. Determine the earlier submitting by registration assertion quantity, or the Type or Schedule and the date of its submitting.
1) Quantity Beforehand Paid:
2) Type, Schedule or Registration Assertion No:
3) Submitting Get together:
4) Date Filed:

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P. O. Field 179
300 North Fundamental Road
Moorefield, West Virginia 26836

April 11, 2022

Pricey Shareholder:

You might be cordially invited to attend the Annual Assembly of Shareholders of Summit Monetary Group, Inc. (the “Firm”), a West Virginia company, which might be carried out solely on-line through reside webcast on Thursday, Might 19, 2022, at 1:00 p.m., EDT. We proceed to embrace the most recent know-how to allow larger shareholder attendance and participation from any location, whereas offering a secure expertise for our shareholders, staff, and our neighborhood.

As a result of the Annual Assembly is digital and being carried out through reside webcast, shareholders won’t be able to attend in individual. Nonetheless, it is possible for you to to attend and take part within the Annual Assembly on-line and submit your questions previous to and through the assembly by visiting www.meetnow.international/MM5ZCZ2 on the assembly date and time.

Shareholders have the identical rights and alternatives by collaborating in a digital assembly as they might if attending an in-person assembly. Particulars relating to the way to take part within the assembly on-line and the enterprise to be carried out on the Annual Assembly are extra absolutely described on this proxy assertion.

Enclosed is the 2021 Annual Report, Discover of Annual Assembly, Proxy Assertion and Proxy Card. Please assessment the enclosed materials and full, signal, date and return the enclosed Proxy Card no matter whether or not you intend to attend the digital Annual Assembly. Your vote is essential in order that issues coming earlier than the assembly could be acted upon. You might also vote your shares electronically utilizing the web or by phone. When you have any questions relating to the data within the proxy supplies, please don’t hesitate to name Teresa Ely, Director of Shareholder Relations, (304) 530-1000.

Very really yours,

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Oscar M. Bean
Chairman of the Board


NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

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TABLE OF CONTENTS

Web page
PROXY STATEMENT 1
Price of Proxy Solicitation 1
A number of Shareholders Sharing the Similar Tackle 1
VOTING INFORMATION 2
Shareholders Entitled to Vote 2
How You Can Vote 2
Vote by Mail 2
Vote by Phone or by Web 2
Voting on the Annual Assembly 2
Voting on Different Issues 3
Required Vote 3
Info on the Digital Assembly 4
Shareholder Account Upkeep 6
PRINCIPAL SHAREHOLDERS 6
OWNERSHIP OF SECURITIES BY DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS 7
Delinquent Part 16(a) Reviews 9
GOVERNANCE OF THE COMPANY 10
Company Governance 10
Board Schooling 10
Board and Committee Membership 11
Board Management Construction 11
Board’s Position in Threat Oversight 11
Board Variety Matrix as of April 11, 2022 12
Human Capital Administration 12
Environmental and Social Practices 12
Anti-Hedging Coverage 13
Board Member Attendance at Annual Assembly 13
Shareholder Communication with Administrators 13
Transactions with Associated Individuals 14
Independence of Administrators and Nominees 14
Government Committee 15
Audit and Compliance Committee 15
Compensation and Nominating Committee 17
Processes and Procedures Regarding Government Compensation 17
Insurance policies and Procedures Regarding the Nomination of Administrators and
    Board Variety
18
Director {Qualifications} and Evaluation of Director Nominees 19
ITEM 1 – ELECTION OF DIRECTORS 20

Nominees for the Class Expiring in 2025 20
Persevering with Administrators Whose Phrases Expire in 2023 22
Persevering with Administrators Whose Phrases Expire in 2024 24
Retirement of Administrators 25
Household Relationships 26
EXECUTIVE OFFICERS 27
ITEM 2 – ADOPTION OF NON-BINDING RESOLUTION TO APPROVE THE
     COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS
28
COMPENSATION DISCUSSION AND ANALYSIS 29
Government Compensation Program 29
Setting Government Compensation 30
Plans Protecting All Workers 36
Potential Funds Upon Termination or Change of Management 37
Compensation of Named Government Officers 43
EXECUTIVE COMPENSATION 44
Abstract Compensation Desk 44
Grants of Plan-Based mostly Awards Throughout 2021 46
Excellent Fairness Awards at December 31, 2021 47
Choices Exercised and Inventory Vested Throughout 2021 48
Pension Advantages 49
Estimated Funds Upon Termination 50
Director Compensation 2021 54
Pay Ratio 56
COMPENSATION AND NOMINATING COMMITTEE REPORT 57
ITEM 3 – RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 57
AUDIT AND COMPLIANCE COMMITTEE REPORT 58
Charges To Unbiased Registered Public Accounting Agency 59
REQUIREMENTS, INCLUDING DEADLINE FOR SUBMISSION
           OF SHAREHOLDER PROPOSALS, NOMINATION OF DIRECTORS AND
           OTHER BUSINESS OF SHAREHOLDERS
60
Shareholder Proposals for the 2023 Annual Assembly 60
Nomination of Administrators 60
Inventory Transfers 61
ANNUAL REPORT 61
FORM 10-Ok 61

PROXY STATEMENT

of

SUMMIT FINANCIAL GROUP, INC.

300 North Fundamental Road

Moorefield, West Virginia 26836

ANNUAL MEETING OF SHAREHOLDERS

MAY 19, 2022

These proxy supplies are delivered in reference to the solicitation by the Board of Administrators of Summit Monetary Group, Inc. (“Summit,” the “Firm,” “we,” or “us”), a West Virginia company, of proxies to be voted at our 2022 Annual Assembly of Shareholders and at any adjournment or postponement.

You might be invited to attend our Annual Assembly of Shareholders on Might 19, 2022, starting at 1:00 p.m., which might be carried out solely on-line through reside webcast. We proceed to embrace the most recent know-how to allow larger shareholder attendance and participation from any location, whereas offering a secure expertise for our shareholders, staff, and our neighborhood.

    It is possible for you to to attend the Annual Assembly on-line and submit your questions prematurely and through the assembly by visiting www.meetnow.international/MM5ZCZ2. You will need to word that shareholders have the identical rights and alternatives by collaborating in a digital assembly as they might if attending an in-person assembly.

This Proxy Assertion, type of proxy and voting directions are being mailed beginning on or about April 11, 2022.

Price of Proxy Solicitation

We can pay the bills of soliciting proxies. Proxies could also be solicited on our behalf by Administrators, officers or staff in individual or by phone, digital transmission, or by facsimile transmission. Brokers, fiduciaries, custodians and different nominees have been requested to ahead solicitation supplies to the helpful homeowners of the Firm’s widespread inventory. Upon request we are going to reimburse these entities for his or her affordable bills.

A number of Shareholders Sharing the Similar Tackle

Homeowners of widespread inventory in avenue title could obtain a discover from their dealer or financial institution stating that just one proxy assertion might be delivered to a number of shareholders sharing an handle. This apply, generally known as “householding,” is designed to scale back printing and postage prices. Nonetheless, if any shareholder residing at such an handle needs to obtain a separate proxy assertion, she or he could contact Teresa Ely, Director of Shareholder Relations, Summit Monetary Group, Inc., P. O. Field 179, Moorefield, West Virginia 26836, or by phone at (304) 530-1000, or by e-mail at [email protected]


VOTING INFORMATION

Shareholders Entitled to Vote

Holders of document of Summit widespread shares on the shut of enterprise on March 30, 2022, are entitled to obtain this discover and to vote their shares on the Annual Assembly. As of that date, there have been 12,766,063 widespread shares excellent. Every widespread share is entitled to at least one vote on every matter correctly introduced earlier than the Annual Assembly.

How You Can Vote

Your vote is essential. Shareholders of document could vote their shares electronically on the Annual Assembly or could vote by proxy, by mail, by phone or by web. Should you select to vote by mail, a postage-paid envelope is offered.

Proxies could also be revoked at any time earlier than they’re exercised by (1) written discover to the Secretary of the Firm, (2) well timed supply of a sound, later-dated proxy or (3) voting electronically on the Annual Assembly.

You could save us the expense of a second mailing by voting promptly. Select one of many following voting strategies to forged your vote.

Vote by Mail

Should you select to vote by mail, merely mark your proxy card, date and signal it, and return it within the postage-paid envelope offered.

Vote by Phone or by Web

    When you have phone or Web entry, you might submit your proxy by following the directions on the proxy card.

Voting on the Annual Assembly

The tactic by which you vote now will under no circumstances restrict your proper to vote electronically on the Annual Assembly for those who later determine to attend the digital assembly on-line. To vote through the Annual Assembly, please log-in to www.meetnow.international/MM5ZCZ2 as a shareholder by getting into the management quantity which is printed in your proxy card.

In case your shares are held within the title of a financial institution, dealer or different holder of document, you should acquire a proxy, executed in your favor, from the holder of document to have the ability to vote on-line on the Assembly. Info relating to the way to acquire a proxy from the holder of document and the way to submit it to Computershare to vote on the Annual Assembly is ready forth under below the heading “How one can Register to Attend the Annual Assembly Nearly on the Web”.

All shares which were correctly voted and never revoked might be voted on the Annual Assembly in accordance along with your directions. Should you signal your proxy card however don’t give voting directions, the shares represented by that proxy might be voted as really helpful by the Board of Administrators.


Voting on Different Issues

If every other issues are correctly introduced on the Annual Assembly for consideration, the individuals named within the enclosed type of proxy intend to train their discretionary authority in accordance with relevant federal and state legal guidelines and laws to vote on these issues for you. As of the date this proxy assertion went to press, we didn’t know of every other matter to be raised on the Annual Assembly.

Required Vote

The presence, on-line on the Annual Assembly or by proxy, of the holders of a majority of the votes entitled to be forged by the shareholders entitled to vote on the Annual Assembly is critical to represent a quorum. Abstentions and dealer “non-votes” are counted as current and entitled to vote for functions of figuring out a quorum. A dealer “non-vote” happens when a nominee holding shares for a helpful proprietor doesn’t vote on a selected proposal as a result of the nominee doesn’t have discretionary voting energy for that exact merchandise and has not acquired directions from the helpful proprietor.

On the document date, there have been 12,766,063 shares of widespread inventory excellent that are held by roughly 1,110 shareholders of document. A majority of the excellent shares of Summit Monetary Group, Inc. will represent a quorum on the assembly.

A plurality of the votes forged is required for the election of administrators. Abstentions and dealer “non-votes” might be disregarded and can have no impact on the result of the vote for the election of administrators.

Within the election of administrators, shareholders forged one (1) vote for every nominee for every share held. Nonetheless, each shareholder has the precise of cumulative voting, electronically or by proxy, within the election of administrators. Cumulative voting provides every shareholder the precise to mixture all votes which she or he is entitled to forged within the election of administrators and to forged all such votes for one candidate or distribute them amongst as many candidates and in such a way because the shareholder wishes.

At our 2022 Annual Assembly, the overall variety of administrators to be elected is 5 (5) within the class expiring in 2025. Every shareholder has the precise to forged 5 (5) votes for every share of inventory held on the document date.

Should you want to train, by proxy, your proper to cumulative voting within the election of administrators, you should present a proxy exhibiting how your votes are to be distributed amongst a number of candidates. Except opposite directions are given by a shareholder who indicators and returns a proxy, all votes for the election of administrators represented by such proxy might be divided equally among the many nominees for every class. The vote represented by the proxies delivered pursuant to this solicitation, which don’t comprise any directions, could also be cumulated on the discretion of the Board of Administrators of Summit Monetary Group, Inc. with a purpose to elect to the Board of Administrators the utmost nominees named on this proxy assertion.

For functions of the ratification of (i) the non-binding decision to approve compensation of the Firm’s named govt officers and (ii) Yount, Hyde & Barbour, P.C. because the Firm’s unbiased registered public accounting agency for the 12 months ended December 31, 2022, an affirmative vote of a majority of the votes forged on every of the proposals is required. In figuring out whether or not the proposals have acquired the requisite variety of affirmative votes, abstentions and dealer “non-votes” might be disregarded and can have no impact on the result of the vote.


Info on the Digital Annual Assembly

How one can Attend the Digital Assembly

    The 2022 Annual Assembly might be a totally digital assembly of shareholders, which might be carried out completely by webcast on the web. No bodily assembly might be held. It is possible for you to to attend the Annual Assembly on-line and submit your questions through the assembly by visiting www.meetnow.international/MM5ZCZ2. Additionally, you will be capable of vote your shares on-line by attending the Annual Assembly by webcast.

    To login to the digital Annual Assembly please go to www.meetnow.international/MM5ZCZ2. You be part of as “Shareholder” or “Visitor”. Should you be part of as a “Shareholder” you’ll be required to have a management quantity. The distinctive management quantity is positioned within the shaded field on the entrance of your proxy card. Should you maintain your shares by way of an middleman, resembling a financial institution or dealer, you should register prematurely utilizing the directions under.

    The web assembly will start promptly at 1:00 p.m. on Might 19, 2022, EDT. We encourage you to entry the assembly previous to the beginning of the assembly to go away ample time for the check-in course of. Please observe the registration directions as outlined under.

    

How one can Register to Attend the Annual Assembly Nearly on the Web

    If you’re a registered shareholder (i.e., you maintain your shares by way of our switch agent, Computershare), you do not want to register to attend the Annual Assembly just about on the web. Please observe the directions on the proxy card that you simply acquired.

    Should you maintain your shares by way of an middleman, resembling a financial institution or dealer, you should register prematurely to attend the Annual Assembly just about on the web. To register and attend the Annual Assembly on-line by webcast you should submit proof of your proxy energy (authorized proxy) reflecting your Summit holdings alongside along with your title and electronic mail handle to Computershare. Requests for registration have to be labeled as “Authorized Proxy” and be acquired no later than 5:00 p.m. Jap Time on Might 16, 2022.

    You’ll obtain a affirmation of your registration by electronic mail after we obtain your registration supplies.

    Requests for registration ought to be directed to Summit on the following:

    By electronic mail: Ahead the e-mail out of your dealer, or connect a picture of your authorized proxy, to [email protected]

    By mail:     Computershare

            Summit Monetary Group, Inc. Authorized Proxy

            P.O. Field 43001

            Windfall, RI 02940-3001

How one can Submit Questions Through the Digital Assembly

Shareholders as of the document date who attend the digital Annual Assembly utilizing their management quantity (as described above) can have the chance to submit questions through the assembly. You could submit questions starting on Might 18, 2022 or through the Annual Assembly by going to the digital assembly web site at www.meetnow.international/MM5ZCZ2, log in as a shareholder by getting into your distinctive management quantity discovered within the shaded field on the entrance of your proxy card. As soon as logged in, click on on the Q&A tab on the high


of the display to submit your query. Questions pertinent to assembly issues might be answered through the assembly, topic to time constraints. If a query is submitted about one of many issues within the agenda to be voted on by the shareholders on the Annual Assembly, the query have to be submitted at or earlier than the time such matter is earlier than the Annual Assembly for consideration. We are going to reply questions on any issues within the agenda to be voted on by the shareholders on the Annual Assembly earlier than the voting is closed.

Following adjournment of the formal enterprise of the Annual Assembly, the Firm will handle applicable common questions from shareholders relating to the Firm. Such questions could also be submitted within the discipline offered within the digital assembly web site through the Annual Assembly. The assembly is just not for use as a discussion board to current private issues, or common financial, political, or different views that aren’t instantly associated to the enterprise of the Firm and the issues correctly earlier than the assembly, and due to this fact questions on such issues won’t be answered.

To permit the Firm to reply as many correct and related questions from as many shareholders as doable, we are going to restrict every shareholder to at least one query. It can assist us if questions are succinct and canopy just one subject per query. Questions from a number of shareholders on the identical subject or which might be in any other case associated could also be grouped, summarized, and answered collectively. The Firm doesn’t intend to deal with any questions which might be:

•    irrelevant to the enterprise of the Firm or to the enterprise of the Annual Assembly;

•    associated to or could have in mind materials, personal info of the Firm;

•    associated to non-public grievances;

•    derogatory references to people or which might be in any other case in dangerous style;

•    considerably repetitious of earlier questions or statements already made by one other shareholder;

•    in furtherance of the shareholder’s private or enterprise pursuits; or

•    out of order, or not in any other case appropriate for the conduct of the Annual Assembly as decided by the Chairman or Company Secretary of their affordable judgment.

All questions might be reviewed by the Chairman. If correctly raised, the Chairman will learn aloud the query and reply to the query or direct applicable officers of the Firm to reply to the query. We are going to submit on our web site (www.summitfgi.com) after the assembly a doc that summarizes and solutions the questions acquired. If a query violates the principles of conduct for asking questions, as described above, it won’t be summarized or answered. The Firm will endeavor to reply individually to applicable shareholder questions posed however not answered through the Annual Assembly, to the extent that shareholder contact info is offered. In any other case, shareholders can direct any such inquiries to Teresa Ely, Director of Shareholder Relations at (304) 530-1000.

Technical Help Through the Digital Assembly

Within the occasion technical points delay or disrupt the Firm’s means to convene the assembly for longer than thirty minutes, the Firm will make an announcement on its web site at www.summitfgi.com below the Information tab below the heading “Press Releases” relating to a date and time for reconvening the Annual Assembly. Within the occasion of dysfunction, technical malfunction or different vital drawback that disrupts the Annual Assembly, the Chairman could adjourn, recess or expedite the Annual Assembly, or take such different motion because the Chairman determines is acceptable in gentle of the circumstances.

The digital assembly platform is absolutely supported throughout browsers (MS Edge, Firefox, Chrome and Safari) and gadgets (desktops, laptops, tablets and cell telephones) working essentially the most up-to-date model of relevant software program and plugins. Shareholders ought to be certain that they’ve a robust Wi-Fi connection


wherever they intend to take part within the assembly. We encourage shareholders to entry the assembly previous to the beginning time. A hyperlink on the assembly web page will present additional help must you want it, or you might name 1-888-724-2416 when you have problem accessing the digital Annual Assembly.

Shareholder Account Upkeep

Computershare Shareholder Companies is our switch agent. All communications regarding accounts of shareholders of document, together with handle modifications, title modifications, inquiries as to necessities to switch widespread shares and comparable points could be dealt with by contacting:

Computershare Shareholder Companies

P.O. Field 505000

Louisville, KY 40233-5000

(800) 368-5948

www.computershare.com/investor

PRINCIPAL SHAREHOLDERS

The next desk lists every shareholder of Summit who’s the helpful proprietor of greater than 5% of Summit’s voting securities as of March 30, 2022.

                             Title of Class

Title and Tackle
of Useful Proprietor

Quantity and Nature of Useful Possession

                                    % of Class

Widespread Inventory

Citadel Creek Capital

Companions V, LP

6051 El Tordo

P. O. Field 1329

Rancho Santa Fe, CA 92067

744,731 5.84%
Widespread Inventory

BlackRock, Inc.

55 East 52nd Road

New York, NY 10055

691,390(1)

5.4%

(1) BlackRock, Inc. holds sole dispositive authority for the 691,390 shares and sole voting authority over 678,139 shares. BlackRock, Inc.’s handle and holdings are primarily based solely on a Schedule 13G submitting with the Securities and Alternate Fee dated February 1, 2022 made by BlackRock, Inc. setting forth info as of December 31, 2021.


OWNERSHIP OF SECURITIES BY DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS

As of March 30, 2022, Administrators, nominees and govt officers as a bunch owned 1,730,045 shares or 13.50% of the Firm’s widespread inventory as indicated on the tables under. The variety of shares proven as beneficially owned by every Director and govt officer is decided below the principles of the Securities and Alternate Fee and usually contains voting or funding energy with respect to securities. The data is just not essentially indicative of helpful possession for every other functions.

Except indicated, to our data, the nominees, different Administrators and govt officers named within the tables have sole voting and sole funding energy with respect to all shares beneficially owned. As a key worker of the Firm, H. Charles Maddy, III could also be granted inventory choices, restricted inventory and restricted inventory items, efficiency items, inventory settled inventory appreciation rights (SARs) and different stock-based awards. Any shares of widespread inventory issuable upon train of at the moment exercisable choices and SARs issued to Mr. Maddy inside 60 days of March 30, 2022 are deemed to be excellent and to be beneficially owned by Mr. Maddy for the aim of computing his proportion possession, however should not handled as excellent for the aim of computing the share possession of every other nominee or Director.

Below the Firm’s bylaws, every Director of the Firm is required to personal inventory in his or her personal title with a minimal worth of a minimum of $500, which is the requirement imposed by West Virginia legislation. The Firm has additionally adopted a coverage that requires {that a} director personal inventory equal to the quantity required by West Virginia legislation to be appointed, and to personal a minimum of 2,000 shares of the Firm’s widespread inventory inside twenty-four months of appointment. Possession is outlined as shares held solely within the Director’s title, shares held by way of the Firm’s worker inventory possession plan, a profit-sharing plan, particular person retirement account, retirement plan or comparable association, and shares owned by an organization the place the Director owns a controlling curiosity. Widespread shares held collectively by a Director and the Director’s partner are counted when figuring out whether or not a Director owns 2,000 shares of the Firm’s inventory so long as the Director owns inventory in his or her personal title within the quantity required by West Virginia legislation. Administrators who’re additionally staff of the Firm or its subsidiaries are exempt from this requirement.


The variety of shares of Widespread Inventory of the Firm beneficially owned by such Administrators are set forth within the following desk.

Title of Director

Quantity of Useful Possession of Summit’s Widespread Inventory as of March 30, 2022
Variety of Shares P.c of Class
Oscar M. Bean

105,600(1)

*
Dewey F. Bensenhaver

34,337(2)

*
Ronald L. Bowling 8,596 *
J. Scott Bridgeforth

7,310(3)

*
James M. Cookman 26,210 *
John W. Crites II

144,526(4)

1.13%
James P. Geary II

41,011(5)

*
Georgette R. George

255,260(6)

2.00%
John B. Gianola 3,286 *
Gary L. Hinkle

506,299(7)

3.97%
Jason A. Kitzmiller 8,246 *
H. Charles Maddy, III

118,904(8)

*
Charles S. Piccirillo

45,263(9)

*
John H. Shott 9,708 *
Ronald B. Spencer

195,168(10)

1.53%
Jill S. Upson

70 (11)

*

(1)    Consists of 23,344 shares owned by partner and 864 held by the Howard Bean Property for which Mr. Bean serves because the Executor.

(2)    Consists of 307 shares owned by partner.

(3)    Consists of 1,150 shares owned by partner.

(4)    Consists of 90,555 Widespread Shares in three subtrusts created for the good thing about youngsters.

(5)    Consists of 7,213 shares of Widespread Inventory owned by partner and three,125 shares of Widespread Inventory within the WE Mullenax Belief for which Mr. Geary is the Trustee.

(6)    Consists of 41,707 shares owned by self-directed IRA FBO partner, 76,785 shares held by George Brothers Funding Partnership, 19,228 shares held by Sellaro Enterprises, Inc. and 77,973 held by the Leroy Rashid Property.

(7)    Consists of 63,853 shares owned by Hinkle Trucking, Inc., 4,800 shares owned by partner, 528 shares owned as custodian for Grandchild, 13,220 shares held by H.T. Companies.

(8)    Consists of 38,850 shares owned by partner and 27,704 absolutely vested shares held in Firm’s ESOP.

(9)    Consists of 582 shares owned by partner and 9,614 shares of widespread inventory held by Auggus Enterprises.

(10)    Consists of 1,368 shares owned by partner and 93,708 shares owned by a Belief FBO Ronald B Spencer.

(11)    Consists of 13 shares owned by partner.

* Signifies director owns lower than 1% of the Firm’s Widespread Inventory.


The variety of shares of Widespread Inventory of the Firm beneficially owned by the Firm’s Government Officers are set forth within the following desk. Shares of Widespread Inventory issuable upon train of at the moment exercisable stock-settled inventory appreciation rights (SARs) inside 60 days of March 30, 2022, are deemed to be excellent and to be beneficially owned by the Government Officer holding the SARs for the aim of computing the share possession of that Government Officer, however should not handled as excellent for the aim of computing the share possession of the opposite Government Officers.

Title of Government Officer Quantity of Useful Possession of Summit’s Widespread Inventory as of March 30, 2022

Variety of Shares(8)

P.c of Class
H. Charles Maddy, III

118,904(1)

*
Robert S. Tissue

82,339(2)

*
Patrick N. Frye

38,348(3)

*
Scott C. Jennings

33,609(4)

*
Bradford E. Ritchie

38,340(5)

*
Patricia L. Owens

14,948(6)

*
Danyl R. Freeman

12,026(7)

*

(1)    Consists of 38,850 shares owned by partner and 27,704 absolutely vested shares held in Firm’s ESOP.

(2)    Consists of 15,273 absolutely vested shares held in Firm’s ESOP and 740 shares owned by self-directed IRA FBO partner.

(3)    Consists of 1,500 shares owned as custodian for grandchildren, 11,763 absolutely vested Widespread Shares held in Firm’s ESOP, 20,000 shares are pledged as collateral.

(4)    Consists of 16,654 absolutely vested Widespread Shares held in Firm’s ESOP.

(5)    Consists of 7,036 absolutely vested Widespread Shares held in Firm’s ESOP, 6,000 shares are pledged as collateral.

(6)    Consists of 4,518 absolutely vested Widespread Shares held in Firm’s ESOP.

(7)    Consists of 9,772 absolutely vested shares held in Firm’s ESOP.

(8)    For functions of the above desk the variety of shares of widespread inventory that may be issuable below the vested SARs awarded in 2015 relies available on the market worth of the Firm’s inventory as of March 30, 2022 of $25.60 and the bottom worth of $12.01, the honest market worth of the Firm’s inventory as of April 23, 2015, the date of grant of the SARs. The variety of shares of widespread inventory that may be issuable below the vested SARs awarded on February 9, 2017 relies available on the market worth of the Firm’s inventory as of March 30, 2022 of $25.60 and the bottom worth of $26.01, the honest market worth of the Firm’s inventory as of February 9, 2017, the date of grant of the SARs. The variety of shares of widespread inventory that may be issuable below the vested SARs awarded on February 7, 2019 relies available on the market worth of the Firm’s inventory as of March 30, 2022 of $25.60 and the bottom worth of $23.94, the honest market worth of the Firm’s inventory as of February 7, 2019, the date of grant of the SARs.

* Signifies govt officer owns lower than 1% of the Firm’s Widespread Inventory.

Delinquent Part 16(a) Reviews

Part 16(a) of the Securities Alternate Act of 1934 and SEC laws require the Firm’s administrators and govt officers and larger than ten % shareholders to file reviews of possession on Type 3 and modifications in possession on Kinds 4 or 5 with the SEC. Based mostly solely on our assessment of copies of such reviews acquired and/or written representations from such administrators and govt officers and ten % shareholders, the Firm believes that every one Part 16(a) submitting necessities relevant to its administrators, govt officers and ten % shareholders have been complied with throughout fiscal 12 months 2021 aside from Ronald L. Bowling, John B. Gianola, Charles S. Piccirillo, and Ronald Spencer who every had one late submitting relating to at least one transaction and Jill S. Upson who had two late filings relating to 2 transactions.


GOVERNANCE OF THE COMPANY

Company Governance

The Firm is dedicated to sustaining robust company governance and operates inside a complete plan of company governance for the aim of defining tasks, setting excessive requirements {of professional} and private conduct and assuring compliance with such tasks and requirements. The Sarbanes-Oxley Act of 2002, amongst different issues, establishes plenty of company governance requirements and disclosure necessities. As well as, the Firm is topic to the company governance and Market Guidelines promulgated by NASDAQ. In gentle of the necessities of the Sarbanes-Oxley Act of 2002 and the NASDAQ company governance and Market Guidelines, Summit has a Compensation and Nominating Committee and an Audit and Compliance Committee, all the members of that are unbiased as outlined by the NASDAQ itemizing requirements and the SEC guidelines. The Compensation and Nominating Committee and the Audit and Compliance Committee have every adopted charters that are reviewed and assessed on an annual foundation. The Firm has adopted a Code of Ethics that applies to all administrators, govt officers and staff of Summit Monetary Group, Inc. and its subsidiaries. The Code of Ethics additionally incorporates supplemental provisions that apply to the Firm’s Chief Government Officer, the Chief Monetary Officer, and the Chief Accounting Officer (the “Senior Monetary Officers”). As well as, the Code of Ethics incorporates procedures for reporting violations of the Code of Ethics involving the Firm’s monetary statements and disclosures, accounting practices, inner management over monetary reporting, disclosure controls and auditing issues. A duplicate of the Code of Ethics is offered on the Firm’s web site at www.summitfgi.com.

Board Schooling

The Firm offers onboarding for brand new administrators and alternative for training and coaching for all board members to foster board effectiveness. In-house instructional classes are offered to all administrators yearly with topics overlaying:

•    Financial institution Secrecy Act (BSA)/Anti-Cash Laundering (AML)

•    Honest Lending

•    Unfair, Misleading, or Abusive Acts or Practices (UDAAP)

•    Dwelling Mortgage Disclosure Act

•    Insider Lending

•    Complaints

•    Regulation BB – Group Reinvestment Act

Extra subjects could also be included as applicable associated to merchandise, providers or traces of enterprise which have potential threat to the Firm and different subjects as recognized by the board of administrators or administration from time-to-time.


Board members are additionally offered alternatives for exterior director training overlaying a spread of points going through the board to help administrators in staying abreast of the most recent developments. The exterior training alternatives are supplied at numerous instances of the 12 months by skilled organizations.

Board and Committee Membership

Throughout 2021, the Board of Administrators met eleven (11) instances. All of our Administrators attended 75% or extra of the conferences of the Board and the conferences held by committees of the Board on which the administrators served in 2021.

The Firm has a standing Government Committee, Audit and Compliance Committee, Compensation and Nominating Committee, Fairness Compensation Committee, Asset/Legal responsibility and Funds Administration Committee and ESOP/401(Ok) Committee.

Board Management Construction

The Board of Administrators of the Firm is led by a Chairman who is just not the Chief Government Officer. Oscar M. Bean at the moment serves because the Chairman of the Board and H. Charles Maddy, III is the Firm’s Chief Government Officer. The Board believes that it is very important formally separate the roles of Chairman of the Board of Administrators and the Chief Government Officer. The separation of those roles leads to a simpler monitoring and goal analysis of the Chief Government Officer’s efficiency. The Board additionally believes that administrators might be extra more likely to problem the Chief Government Officer if the Chief Government Officer is just not the Chairman of the Board.

Board’s Position in Threat Oversight

Senior administration is liable for assessing and managing the Firm’s numerous exposures to threat on a day-to-day foundation, together with the creation of applicable threat administration applications and insurance policies. The Board is liable for overseeing administration within the execution of its tasks and for assessing the Firm’s method to threat administration. The Board workout routines these tasks periodically as a part of its conferences and in addition by way of the Board’s committees, every of which examines numerous elements of threat as a part of their tasks. The Board’s function within the Firm’s threat oversight course of contains receiving common reviews from members of senior administration and reviews from committees of the Board on areas of fabric threat to the Firm, together with operational, market, credit score, monetary, authorized and regulatory dangers. This permits the Board, senior administration, and the committees of the Board to coordinate the chance oversight function, significantly with respect to threat interrelationships. As well as, an total assessment of threat is inherent within the Board’s consideration of the Firm’s long-term methods and within the transactions and different issues introduced to the Board, together with capital expenditures, acquisitions and divestitures, and monetary issues.

Throughout 2021, the Board reviewed the continued impression of the COVID-19 pandemic and its impact on the Firm’s staff and shoppers. Administration continued a number of methods and initiatives initially carried out in 2020 to mitigate adversarial impacts. In an effort to defend staff and guarantee workforce continuity, administration utilized flex time scheduling, when doable, for important roles within the operation facilities.


BOARD DIVERSITY MATRIX AS OF APRIL 11, 2022
Whole Variety of Administrators 16
  Feminine Male Non-Binary Did Not Disclose Gender
Half I: Gender Identification  
Administrators 2 14
Half II: Demographic Background  
African American or Black 1
White 1 14
LGBTQ+
Did Not Disclose Demographic Background
Administrators who’re Navy Veterans 1

Human Capital Administration

The Board and its committees assessment and focus on with administration issues associated to human capital administration, together with the Firm’s commitments and progress on range and inclusion, compensation and advantages, enterprise conduct and compliance, and govt succession planning. 

As mentioned in additional element within the Firm’s Type 10-Ok included within the 2021 Annual Report, the Firm focuses on aggressive compensation and advantages to draw and retain the perfect staff, together with the power to take part in our 401(ok) outlined contribution plan and Worker Inventory Possession Plan as additional mentioned on web page 36. The Firm additionally helps skilled growth and on the job coaching to assist our group members enhance their abilities to arrange them for development throughout the Firm.  We assist work-life stability by providing paid break day for trip, holidays, sick go away, and bereavement.  

Summit values range in our staff, clients, suppliers, market, and neighborhood.   We consider using a various workforce that’s reflective of our clients and the communities that we serve helps us to raised determine and ship ‘Service Past Expectations’ to fulfill our clients’ and communities’ specific monetary wants.  In line with these efforts, 78% of our workforce is gender/racial various. 

Environmental and Social Practices

The next sections describe steps taken by the Firm to advertise environmental sustainability and social accountability.

Environmental

The Firm has been a forerunner in making its operations extra sustainable and lowering its carbon footprint. In 1999, the Firm adopted a less-paper initiative during which it commenced imaging checks, emailing month-to-month financial institution statements, and scanning and indexing mortgage paperwork. The Firm promotes the usage of know-how to scale back its carbon footprint. In 2018, the Firm adopted a system for digital execution of paperwork when opening deposit accounts for purchasers and shutting loans for purchasers. The Firm encourages all financial institution clients to view and execute deposit and mortgage accounts electronically. Tellers in any respect areas not use paper tickets and as an alternative use digital tickets to scale back the usage of paper and enhance effectivity in processing transactions. At the moment, the Firm shreds and


recycles paper utilized in its department places of work. The Firm makes use of digital channels to offer carbon impartial banking services and products to its clients, staff and Board members, together with an web banking system, a cellular digital banking system, E-Deposit providers, E-signature on mortgage paperwork, paperless statements, and a board portal for electronically offering Board supplies and knowledge. The Firm additionally makes use of video conferencing and different know-how to scale back its staff journey between branches. The Firm has carried out quite a few vitality conservation strategies in its department places of work together with changing lighting in branches to LED lighting (with 12 branches absolutely transformed to LED lighting, 2 branches the place the outside lighting has been transformed and 31 branches that are in technique of phasing in LED lighting); putting in gentle activation movement sensors; putting in vitality environment friendly HVAC items and changing mulch with stone scaping.

Social Accountability

Via its banking subsidiary, Summit Group Financial institution, the Firm helps its neighborhood by way of neighborhood growth loans, investments in neighborhood growth tasks, donations to non-profit organizations, charitable enterprises and neighborhood organizations and neighborhood service tasks carried out by staff. In 2021, Summit Group Financial institution made roughly $86.2 million in neighborhood growth loans, invested $28.1 million in certified neighborhood growth tasks, and donated roughly $175,000 to numerous charities, neighborhood organizations, meals pantries and faculties. In 2020 and 2021, the workers of the Firm and Summit Group Financial institution devoted quite a few hours volunteering within the native communities throughout the Firm’s footprint.

Anti-Hedging Coverage

The entire Firm’s administrators, officers and staff are topic to the Summit Monetary Group, Inc. Firm Inventory Transaction Coverage. This coverage offers that it’s improper and inappropriate for any director, officer or different worker of the Firm to have interaction in short-term or speculative transactions within the Firm’s securities. Particularly, the coverage discourages administrators and officers and different staff and prohibits insiders from partaking in short-term buying and selling and brief gross sales of the Firm’s securities. The coverage additionally discourages administrators, officers and staff from partaking in transactions within the Firm’s inventory in places, calls or different by-product securities on an change or in every other organized market and from holding the Firm’s securities in a margin account. Along with the above-mentioned transactions, the Firm additionally prohibits administrators, officers and staff from partaking in any type of hedging technique by way of which such individual’s funding place can be improved on account of a lower within the worth of the Firm’s inventory.

Board Member Attendance at Annual Assembly

The Firm doesn’t have a coverage with regard to administrators’ attendance at annual conferences. Eight (8) of fifteen (15) incumbent members of the Board of Administrators attended the 2021 Annual Assembly of Shareholders.

Shareholder Communication with Administrators

The Board of Administrators of the Firm offers a course of for shareholders to ship communications to the Board of Administrators or to any of the person Administrators. Shareholders could ship written communications to the Board of Administrators or to any of particular person Director c/o Company Secretary on the following handle: Summit Monetary Group, Inc., P. O. Field 179, 300 North Fundamental Road, Moorefield, West Virginia 26836. All communications might be compiled by the Company Secretary of the Firm and submitted to the Board of Administrators or to the person Administrators on a periodic foundation.


Transactions with Associated Individuals

The Firm has written insurance policies and procedures for assessment, approval and monitoring of transactions involving the Firm and “associated individuals” (administrators, nominees for director, and govt officers or their instant households, or shareholders proudly owning 5 % or larger of the Firm’s excellent voting inventory). The coverage covers any associated individual transaction that meets the minimal threshold for disclosure within the proxy assertion below the related SEC guidelines (usually, transactions involving quantities exceeding $120,000 during which a associated individual has a direct or oblique materials curiosity).

Administrators and govt officers of the Firm and its subsidiaries, members of their instant households, and enterprise organizations and people related to them have been clients of, and have had regular banking transactions with Summit Group Financial institution. All such transactions have been made within the bizarre course of enterprise, have been made on considerably the identical phrases, together with rates of interest and collateral, as these prevailing on the time for comparable transactions with individuals not associated to Summit and didn’t contain greater than the traditional threat of collectability or current different unfavorable options. Loans made to administrators and govt officers are in compliance with federal banking laws and are thereby exempt from insider mortgage prohibitions included within the Sarbanes-Oxley Act of 2002.

The Board of Administrators reviewed all transactions with associated events since January 1, 2021, to find out if such transactions have been required to be reported on this Proxy Assertion. The Firm has not entered into any transactions with associated individuals since January 1, 2021, that met the brink for disclosure on this Proxy Assertion below the related SEC guidelines, nor has the Firm entered right into a present transaction, during which the quantity of the transaction exceeds the brink for disclosure on this Proxy Assertion below related SEC guidelines and during which a associated individual had or can have a direct or oblique materials curiosity.

Independence of Administrators and Nominees

The Board of Administrators yearly critiques the relationships of every of its members with the Firm to find out whether or not every director is unbiased. This willpower relies on each subjective and goal standards developed by the NASDAQ itemizing requirements and the SEC guidelines.

The Board of Administrators reviewed the administrators’ responses to a questionnaire asking about their relationships with the Firm (and people of their instant members of the family) and different potential conflicts of curiosity, in addition to info offered by administration associated to transactions, relationships, or preparations between the Firm and the administrators or events associated to the administrators with a purpose to decide the independence of the present members of the Board of Administrators and the nominees for election as a director of the Firm.

Based mostly on the subjective and goal standards developed by the NASDAQ itemizing requirements and the SEC guidelines, the Board of Administrators decided that the next nominees and present members of the Board of Administrators are unbiased: Oscar M. Bean, Dewey F. Bensenhaver, J. Scott Bridgeforth, James M. Cookman, John W. Crites, II, James P. Geary, II, Georgette R. George, John B. Gianola, Gary L. Hinkle, Jason A. Kitzmiller, Charles S. Piccirillo, John H. Shott, Ronald B. Spencer and Jill S. Upson. H. Charles Maddy, III is just not unbiased as a result of he’s an govt officer of the Firm and Ronald L. Bowling is just not unbiased as a result of he was employed by a subsidiary of the Firm throughout 2019 and acquired compensation for such providers.


The NASDAQ itemizing requirements comprise further necessities for members of the Compensation and Nominating Committee and the Audit and Compliance Committee. The entire administrators serving on every of those committees are unbiased below the extra necessities relevant to such committees.

The Board thought of the next relationships in evaluating the independence of the Firm’s Administrators and decided that not one of the relationships represent a fabric relationship with the Firm and every of the relationships happy the requirements for independence:

•    Summit Group Financial institution, Inc., a subsidiary of the Firm, offered lending and/or different monetary providers to every member of the Firm’s Board of Administrators, their instant members of the family, and/or their affiliated organizations throughout 2021 and 2020 within the bizarre course of enterprise and on considerably the identical phrases as these obtainable to unrelated events; and

•    Oscar M. Bean, James P. Geary, II, Charlie S. Piccirillo and Georgette George’s husband are companions of legislation corporations that acquired funds for authorized providers offered to the Firm or its subsidiaries throughout 2021 and 2020. The authorized charges acquired have been lower than 1% of every of the legislation corporations’ and Summit’s income in 2021 and 2020. Every legislation agency acquired lower than $10,000 in authorized charges from the Firm and its subsidiaries in 2021 and 2020, aside from Geary and Geary who acquired $11,803 in authorized charges in 2021.

Government Committee

The Government Committee, on an as wanted foundation, approves loans above specified limits and performs such duties and workout routines such powers as delegated to it by the Firm’s Board of Administrators. The present members of the Firm’s Government Committee are Oscar M. Bean, Chairman, John W. Crites, II, James P. Geary, II, Georgette R. George, Gary L. Hinkle, H. Charles Maddy, III and Charles S. Piccirillo. The Government Committee met two instances in 2021.

Audit and Compliance Committee

The Audit and Compliance Committee’s main operate is to help the Board of Administrators in fulfilling its oversight tasks to make sure the standard and integrity of Summit’s monetary reviews. This entails:

•    Serving as an unbiased and goal celebration to watch the Firm’s monetary reporting course of and inner management system.

•    Offering route to and oversight of the Firm’s inner audit operate.

•    Reviewing and appraising the efforts of the Firm’s unbiased auditors.

•    Sustaining a free and open technique of communication between administrators, inner audit employees, unbiased auditors, and administration.

The Audit and Compliance Committee has adopted a written constitution, a replica of which is offered on the Firm’s web page at www.summitfgi.com. The Audit and Compliance Committee constitution requires that the committee be comprised of 5 (5) or extra administrators. The Audit and Compliance Committee met 4 instances in 2021.


Present members of this committee are John B. Gianola, Chairman, John W. Crites, II, Georgette R. George, Gary L. Hinkle, Jason A. Kitzmiller, Charles S. Piccirillo and Ronald B. Spencer. All members of the Audit and Compliance Committee are unbiased, as independence is outlined below the NASDAQ itemizing requirements.

Pursuant to the provisions of the Sarbanes-Oxley Act, which was enacted in 2002, the SEC adopted guidelines requiring firms to reveal whether or not or not a minimum of one member of the Audit and Compliance Committee is an “audit committee monetary skilled” as outlined in such guidelines.

Below the SEC guidelines, an “audit committee monetary skilled” has the next attributes:

•    An understanding of usually accepted accounting rules and monetary statements;

•    A capability to evaluate the final utility of accounting rules usually accepted in the USA of America in reference to the accounting for estimates, accruals and reserves;

•    Expertise getting ready, auditing, analyzing, or evaluating monetary statements that current a breadth and degree of complexity of accounting points which might be usually akin to the breadth and complexity of points that may be anticipated to be raised by the Firm’s monetary statements, or expertise actively supervising a number of individuals engaged in such actions;

•    An understanding of inner controls and procedures for monetary reporting; and

•    An understanding of audit committee capabilities.

An individual should possess all the above attributes to qualify as an audit committee monetary skilled.

Based mostly on Director Questionnaires, the Board of Administrators has decided that John W. Crites, II and John B. Gianola of the Audit and Compliance Committee possess all the above 5 attributes in order to be deemed “audit committee monetary specialists” below the SEC guidelines.

As well as, John W. Crites, II, John B. Gianola and Gary L. Hinkle every qualify as a “monetary skilled” below the NASDAQ Market Guidelines, which requirements are completely different from the SEC guidelines. Below the NASDAQ Market Guidelines, a “monetary skilled” should have previous employment expertise in finance or accounting, requisite skilled certification in accounting or different comparable expertise or background which leads to the person’s monetary sophistication, together with being a chief govt officer, chief monetary officer or different senior officer with monetary oversight tasks. Mr. Crites, Mr. Gianola and Mr. Hinkle have the required expertise to qualify them as “monetary specialists” below the NASDAQ Market Guidelines.

For info regarding the audit charges paid by the Firm in 2021 and for details about the Firm’s unbiased auditors usually, see the Audit and Compliance Committee Report on web page 59 of those Annual Assembly supplies.


Compensation and Nominating Committee

The Compensation and Nominating Committee should include a minimal of 4 (4) unbiased, outdoors administrators. Present members of the Compensation and Nominating Committee are Oscar M. Bean, Chairman, Dewey F. Bensenhaver, James M. Cookman, James P. Geary, II, John B. Gianola, Gary L. Hinkle and Charles S. Piccirillo. The Fairness Compensation Committee is a sub-committee of the Compensation and Nominating Committee and consists of the next members: Oscar M. Bean, Dewey F. Bensenhaver, James M. Cookman, John B. Gianola, Gary L. Hinkle and Charles S. Piccirillo

The Compensation and Nominating Committee has adopted a written constitution, a replica of which is offered on the Firm’s web site at www.summitfgi.com.

The Committee meets at scheduled instances through the 12 months as required, usually one to 2 instances. The Committee reviews on Committee actions at Board conferences. The Committee has the authority to retain outdoors counsel and every other advisors because the Firm could deem applicable in its sole discretion. The Compensation and Nominating Committee met two instances in 2021.

Processes and Procedures Regarding Government Compensation

One objective of the Compensation and Nominating Committee is to assessment, approve and report back to the Board of Administrators the compensation of all govt officers of the Firm who’re topic to the necessities of Part 16 of the Securities Alternate Act of 1934 (the “Government Officers”), together with salaries and bonuses, and to approve and report back to the Board of Administrators all different incentive and fairness compensation awards. The Compensation and Nominating Committee additionally yearly critiques the Board Attendance and Compensation Coverage which incorporates the compensation paid to the Board of Administrators. The Compensation and Nominating Committee recommends any revisions to the Board Attendance and Compensation Coverage to the complete Board of Administrators for approval. The Committee’s main processes and procedures for finishing up these functions embody:

•    Scope of Authority. The Committee has the next duties and tasks:

•    Yearly assessment and approve company objectives and goals related to compensation of the Chief Government Officer (the “CEO”) established by the Board of Administrators, consider the CEO’s efficiency in gentle of those objectives and goals, and assessment, approve and report back to the Board of Administrators all compensation preparations, together with base wage, incentive compensation and long-term compensation for the CEO.

•    Yearly assessment, approve and report back to the Board of Administrators all compensation preparations, together with base wage, incentive compensation and long-term compensation, for all different Government Officers.

•    Evaluation, approve and report back to the Board of Administrators compensation packages for brand new Government Officers and termination packages for Government Officers.

•    Evaluation and make suggestions to the Board of Administrators for ratification choices regarding long-term incentive compensation plans, together with the usage of equity-based plans. Besides as in any other case delegated by the Board of Administrators, the Fairness Compensation Committee acts on behalf of the Board of Administrators and the Compensation and Nominating Committee because the “committee” established to manage equity-based and worker profit plans, and as such, discharges any tasks imposed on the committee below these plans, together with making and authorizing grants in accordance with the phrases of these plans. All such grants have to be ratified by the Board of Administrators.


•    Make suggestions to the Board of Administrators with respect to issues regarding incentive compensation and equity-based plans that are applicable for motion by the Board of Administrators below relevant NASDAQ and SEC guidelines.

•    Oversee the Firm’s compliance with SEC guidelines and laws relating to shareholder approval of sure govt compensation issues, together with advisory votes on govt compensation and the frequency of such votes.

•    Evaluation all director compensation and advantages for service on the Board and Board committees and suggest any modifications to the Board as crucial.

•    Delegation of Authority. The Committee has the authority to delegate any of its tasks to subcommittees because the Committee could deem applicable.

•    Position of Government Officers. The Chief Government Officer offers the Committee with a verbal efficiency evaluation and compensation suggestion for every of the opposite Government Officers. Along with the next objects, these efficiency assessments and proposals are thought of by the Committee in reviewing, approving and reporting to the Board the compensation preparations of every Government Officer aside from the CEO: (i) an evaluation of the Firm’s efficiency, (ii) the perquisites offered to the Government Officers, (iii) the salaries paid by a peer group to govt officers holding equal positions, (iv) tally sheets exhibiting the combination quantity of all elements of compensation paid to the Government Officers, and (v) the complexity of the job duties of every Government Officer.

•    Position of Unbiased Guide. The Committee has the authority to retain any advisors because the Committee deems applicable in finishing up its duties, however solely after making an allowance for elements related to the advisor’s independence from administration specified within the NASDAQ itemizing requirements. The Committee has not retained the providers of an unbiased marketing consultant in reviewing and approving the shape and quantity of govt and director compensation.

Insurance policies and Procedures Regarding the Nomination of Administrators and Board Variety

The Compensation and Nominating Committee assists the Board in (i) figuring out certified people to change into board members, (ii) figuring out the composition of the Board of Administrators and its committees, (iii) monitoring a course of to evaluate board effectiveness, and (iv) creating and implementing the Firm’s company governance tips.

In figuring out nominees for the Board of Administrators, the Compensation and Nominating Committee selects people who’ve the best private {and professional} integrity and who’ve demonstrated distinctive means and judgment. The Committee additionally selects people who’re simplest, along with the opposite nominees to the Board, in collectively serving the long-term pursuits of the shareholders. In figuring out first-time nominees for director, or evaluating people really helpful by shareholders, the Compensation and Nominating Committee determines, in its sole discretion, whether or not a person meets the minimal {qualifications} accepted by the Board of Administrators and will take into account the present composition of the Board of Administrators in gentle of the various communities served by the Firm and the interaction of the candidate’s expertise with the expertise of different Board members.


In performing its tasks for figuring out, recruiting and recommending nominees for director, the Compensation and Nominating Committee will take into account all facets of every candidate’s {qualifications} and abilities within the context of the wants of the Firm at the moment with a view to making a Board with a range of expertise and views, together with range with respect to race, gender, geography and areas of experience. In 2021, the Compensation and Nominating Committee dedicated to extend the range of the Board, and amended its constitution to increase the definition of range of board expertise and views to incorporate ethnicity, nationality, sexual orientation, disabilities and cultural background. Previous to this revision, the definition of range of board expertise and views solely included race, gender, geography and areas of experience. As well as, the Compensation and Nominating Committee achieved its objective for 2021 of including a various board member throughout 2021 and having a minimum of one lady and one various board candidate for consideration by the shareholders on the 2022 Annual Assembly. The Firm has additionally added a query to its Director and Officer Questionnaire to require administrators and officers to self-identify various traits to permit the Firm to evaluate and observe this info. It will enable the Firm to watch its progress in selling range of the Board of Administrators in addition to range of the Firm’s administration.

The Compensation and Nominating Committee doesn’t have a selected coverage with regard to the consideration of individuals nominated for Administrators by shareholders. The Articles of Incorporation of the Firm describe the procedures {that a} shareholder should observe to appoint individuals for election as Administrators. For extra info relating to these procedures, see Necessities, Together with Deadline for Submission of Shareholder Proposals, Nomination of Administrators and Different Enterprise of Shareholders on web page 60 of those Annual Assembly supplies. The Compensation and Nominating Committee will take into account nominees for Director really helpful by shareholders offered the procedures set forth within the Articles of Incorporation of the Firm are adopted by shareholders in submitting suggestions.The Committee doesn’t intend to change the way during which it evaluates nominees, together with the minimal standards set forth above, primarily based on whether or not the candidate was really helpful by a shareholder or not.

Director {Qualifications} and Evaluation of Director Nominees

In reference to the Director nominations for the 2022 Annual Assembly, the Compensation and Nominating Committee thought of the Nominee’s and the Persevering with Administrators’ roles in figuring out and understanding the Firm’s dangers and overseeing the Firm’s compliance with its threat administration program. These issues have been along with the {qualifications}, abilities and attributes described above which might be thought of by the Compensation and Nominating Committee in deciding on Nominees for the Board of Administrators.

Along with fulfilling the above standards, all the Nominees for election to the category expiring in 2025 are unbiased below the NASDAQ itemizing requirements and the SEC guidelines besides Ronald L. Bowling. The entire administrators whose phrases expire in 2023 and 2024 (the “Persevering with Administrators”) are unbiased below the NASDAQ itemizing requirements and the SEC guidelines besides H. Charles Maddy, III. Mr. Maddy is just not unbiased as he’s an govt officer and worker of the Firm. Mr. Bowling is just not unbiased as a result of he was employed by a subsidiary of the Firm in 2019 and acquired compensation for such providers.

Every Nominee and Persevering with Director brings a robust and distinctive background and set of abilities to the Board offering the Board as a complete competence and expertise in all kinds of areas together with banking, accounting, audit and monetary reporting, authorized, finance, renewable vitality, governmental relations, enterprise administration, contracting, insurance coverage, timber, transportation, farming, hospitality and retail.


ITEM 1 – ELECTION OF DIRECTORS

The Board of Administrators is split into three (3) lessons. The phrases of the Administrators in every class expire at successive annual conferences. 5 (5) Administrators might be elected at our 2022 Annual Assembly to serve a three-year time period expiring at our Annual assembly in 2025. If the proposed nominees are elected, the Firm can have a Board of Administrators consisting of three lessons of 5 (5) administrators.

The individuals named within the enclosed proxy intend to vote the proxy for the election of every of the 5 (5) nominees, except you point out on the proxy card that your vote ought to be withheld from all or any of such nominees. Every nominee elected as a Director will proceed in workplace till his or her successor has been elected, or till his or her dying, resignation or retirement.

The Board of Administrators has proposed the next nominees for election as Administrators, with three-year phrases expiring on the Annual Assembly in 2025: Oscar M. Bean, John W. Crites, II, James P. Geary, II, Charles S. Piccirillo and Jill S. Upson. The entire nominees have been really helpful by the Compensation and Nominating Committee and accepted by the Board of Administrators of the Firm. Every of the nominees are Administrators standing for re-election.

The Board of Administrators recommends a vote FOR the election of those nominees for election as Administrators.

We anticipate every nominee for election as a Director to have the ability to serve if elected. To the extent permitted by relevant legislation, if any nominee is just not capable of serve, proxies might be voted in favor of the rest of these nominated and could also be voted for substitute nominees, except the Board chooses to scale back the variety of Administrators serving on the Board.

The principal occupation, expertise, {qualifications}, abilities, and different attributes thought of by the Board in concluding that the nominees and different Administrators whose phrases of workplace proceed after the Annual Assembly are certified to function Administrators of the Firm are set forth under on the next pages 20-25.

Nominees for the Class Expiring in 2025

Title

Age as of the Might 19, 2022

 Assembly Date

Yr First

Elected Director

Oscar M. Bean 71 1987
John W. Crites, II 52 2016
James P. Geary, II 66 2007
Charles S. Piccirillo 67 1998
Jill S. Upson 55 2021

Oscar M. Bean has served as a member of the Board of Administrators of the Firm since 1987 and has served as a member of the Board of Administrators of Summit’s banking subsidiary since 1978.  Mr. Bean was named Chairman of the Board of the Firm in 1995, and has served on this capability for the final 25 years.  Mr. Bean is a Associate of Bean & Bean, Attorneys at Legislation and was previously the prosecuting lawyer 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 College School of Legislation Visiting Committee.  Mr. Bean is at the moment the Chairman of the Jap West Virginia Group and Technical School Basis. Since March, 2017, Mr. Bean has been a member of the West Virginia Supreme Courtroom’s Character Committee which interviews candidates who search to be admitted to apply legislation within the State of West Virginia. Mr.


Bean additionally chairs the Government Committee and Compensation and Nominating Committee and is a member of the Asset/Legal responsibility and Funds Administration Committee and the Fairness Compensation Committee.

John W. Crites, II has served as a member of the Board of Administrators of the Firm since 2016. Mr. Crites has served because the President of Allegheny Wooden Merchandise, Inc. since April, 2006. Previous to this time, Mr. Crites served as common supervisor of Allegheny Wooden Merchandise, Inc. the place he was actively concerned within the total operations of the corporate. Mr. Crites additionally serves because the President and proprietor of Appalachian Wooden Pellets, Inc. Mr. Crites earned his Bachelor of Science diploma in forestry, wooden industries, from West Virginia College. Mr. Crites serves on the board of administrators of the Hardwood Federation and is a member of the WVU Forestry Endowment Belief Committee and the Younger Presidents Group. Mr. Crites is a previous member of the Board of Administrators of the Nationwide Hardwood Lumber Affiliation and Appalachian Hardwood Producers Affiliation. He had additionally served on the Strategic Planning Committee for the Grant County Board of Schooling and was a member of the Strategic Evaluation Committee for the WVU College of Forestry. Mr. Crites is a member of the Government Committee, the Audit and Compliance Committee and the Asset/Legal responsibility and Funds Administration Committee.

James P. Geary, II has served as a member of the Board of Administrators of the Firm since 2007 and served as a member of the Board of Administrators of Summit’s banking subsidiary from 2007 to 2008. Mr. Geary was reappointed as a member of the Board of Administrators of Summit’s banking subsidiary in Might 2011. Mr. Geary is a Associate of the legislation agency Geary & Geary and is an actual property dealer for Landimer, Inc.  Mr. Geary is a title insurance coverage agent for Outdated Republic Title Insurance coverage Firm and First American Title Insurance coverage Firm.  Mr. Geary earned his Bachelor of Science diploma in accounting from the West Virginia College College of Enterprise and acquired his legislation diploma from the West Virginia College School of Legislation.  Mr. Geary is a present member of the West Virginia Forestry Affiliation.  Mr. Geary has served as a mediator within the 21st and 22nd West Virginia Judicial Circuits and serves because the Psychological Hygiene Commissioner within the 21st West Virginia Judicial Circuit. Mr. Geary is a constitution member of the Grant and Hardy County Gideons and is the Faithfund Regional Program Chief of the West Virginia Gideons Worldwide.  Mr. Geary was additionally a professor at Shepherd School, Shepherdstown, West Virginia.  Mr. Geary is a member of the Government Committee, the Compensation and Nominating Committee and the Asset/Legal responsibility and Funds Administration Committee.

Charles S. Piccirillo has served as a member of the Board of Administrators of the Firm since 1998 and served as a member of the Board of Administrators of Summit’s banking subsidiary from 1996 to 2008. Mr. Piccirillo was reappointed as a member of the Board of Administrators of Summit’s banking subsidiary in Might 2011. Mr. Piccirillo was a member within the legislation agency of Shaffer & Shaffer, PLLC by way of December 30, 2020, at which period he turned counsel to Shaffer & Shaffer, PLLC. On January 1, 2021, Mr. Piccirillo established and is the only real member of C.S. Piccirillo Legislation, PLLC. Mr. Piccirillo can be a Associate with Lawoff Associates, and President of Auggus Enterprises, Inc., each of that are actual property entities. Mr. Piccirillo acquired his legislation diploma from the West Virginia College School of Legislation in 1980 and Mr. Piccirillo is a member of the Government Committee, the Audit and Compliance Committee, the Compensation and Nominating Committee and the Fairness Compensation Committee.

Jill S. Upson has served as a member of the Board of Administrators of the Firm and Summit’s banking subsidiary since November 18, 2021.  Ms. Upson is the Government Director of the Herbert Henderson Workplace of Minority Affairs. She was appointed to this cabinet-level place in December 2018 after serving 4 years as a legislator within the West Virginia Home of Delegates. Elected twice to the


West Virginia Home of Delegates, Ms. Upson served as Vice Chair of the Banking and Insurance coverage Committee along with serving on numerous committees, caucuses, and commissions. Because of her steadfast management in prison justice reform, Ms. Upson was acknowledged by the Governor of West Virginia along with his Civil Rights Award. Ms. Upson holds the excellence of creating state historical past as the primary black Republican lady elected to the West Virginia Home of Delegates. She additionally serves as Chair of the Martin Luther King, Jr. State Vacation Fee. Ms. Upson shaped and chairs the COVID-19 Advisory Fee on Racial Disparities which continues to steer in statewide equitable vaccine distribution. She additionally efficiently spearheaded all weekly minority COVID-19 testing websites in a number of areas all through the State of West Virginia through the peak of the pandemic. Ms. Upson earned a Bachelor of Science diploma in Enterprise Administration from Shepherd College and is anticipated to finish an MBA from Liberty College in early 2022. Ms. Upson is a member of the Asset/Legal responsibility and Funds Administration Committee and the ESOP/401(ok) Committee.

Persevering with Administrators Whose Phrases Expire in 2023

Title

Age as of the Might 19, 2022

Assembly Date

Yr First

Elected Director

Ronald L. Bowling 67 2020
J. Scott Bridgeforth 58 2011
Georgette R. George 61 2010
John B. Gianola 68 2016
John H. Shott 73 2017

Ronald L. Bowling has served as a member of the Board of Administrators since January 1, 2020. Mr. Bowling served as Market President for Summit’s banking subsidiary from January 1, 2019 to December 31, 2019. Mr. Bowling was previous Chairman, President, CEO and Director of the previous First Peoples Financial institution from April 2011 to December 31, 2018. Mr. Bowling has over 46 years of banking expertise. Mr. Bowling acquired his Bachelor of Science diploma in enterprise administration with focus in accounting from Harmony School and is a licensed Licensed Public Accountant. Mr. Bowling is the previous president and director of the West Virginia Group Bankers Affiliation, previous director of the Wyoming County Financial Growth Authority and previous director of the West Virginia Bankers Affiliation. Mr. Bowling is a member of the Wyoming County Council on Growing old and Director of Metropolis of Mullens Basis. Mr. Bowling is a member of the ESOP/401(ok) Committee and the Asset/Legal responsibility and Funds Administration Committee.

J. Scott Bridgeforth has served as a member of the Board of Administrators since 2011. Mr. Bridgeforth has served as a member of the Board of Administrators of Summit’s banking subsidiary since 1999. Mr. Bridgeforth is at the moment the proprietor and Vice-President of Royal Crown Bottling Firm of Winchester, Inc. and Royal Crown Bottling Firm of Hagerstown, Maryland, and the proprietor and President of Positive Guess Companies, Inc. Mr. Bridgeforth acquired his Bachelor of Enterprise Administration diploma in enterprise administration from James Madison College and has 31 years of expertise in proudly owning and working his personal enterprise. Mr. Bridgeforth is a member of the ESOP/401(Ok) Committee and Asset/Legal responsibility and Funds Administration Committee.

Georgette R. George has served as a member of the Board of Administrators since 2010. Ms. George additionally served as a member of the Board of Administrators of Summit from March 1998 to December 1999 and served as a member of the Board of Administrators of Summit’s banking subsidiary from 1995 to 2005. Ms. George was re-appointed as a member of the Board of Administrators of Summit’s banking subsidiary in December 2009. Ms. George is the Chief Government Officer and Government Crew Member of Monarch Holdings. She has been engaged with the companies inside Monarch for greater than 30 years. She is a principal in plenty of enterprise enterprises concerned in numerous retail, workplace, and resort growth tasks, of which she manages the executive, resort, and monetary operations. She has most just lately been concerned within the growth and sale of a SaaS enterprise focused for the resort business. As well as, Ms. George is the co-president of Affiliate Companies and vice-president of Ridgeline, Inc. Beforehand, she held a place in gross sales administration on the Hewlett-Packard Firm the place she acquired the President’s


Award, that firm’s highest gross sales achievement award. Ms. George has a robust understanding of enterprise administration and finance by way of her expertise in managing and working a number of companies. Ms. George has served on the Boards of quite a few non-profit organizations, together with the Thomas Hospital Basis, Group Council of Kanawha Valley, and the Conference Bureaus of the cities of each Charleston and South Charleston. She at the moment serves as a director of the West Virginia Regional Know-how Park Corp, Higher Kanawha Valley Basis, West Virginia Funding Administration Board and the West Virginia College of Osteopathic Drugs Basis. She is a member of the Federal Reserve West Virginia Advisory Committee for the Fifth District. Ms. George was a recipient of the Girls of Achievement Award conferred by the Younger Girls’s Christian Affiliation of Charleston. Ms. George is a graduate of Vanderbilt College the place she earned a Bachelor of Engineering diploma in biomedical and electrical engineering. Ms. George is a member of the Audit and Compliance Committee, the Government Committee and the Asset/Legal responsibility and Funds Administration Committee.

John B. Gianola has served as a member of the Board of Administrators of the Firm since December 2016.  Mr. Gianola retired in 2013 as a managing accomplice of the Charleston, West Virginia workplace of Ernst & Younger LLP (“EY”), a global public accounting agency, the place he was liable for EY’s apply within the State of West Virginia. Throughout his 38-year profession with EY, he had supervisory accountability for engagements involving accounting and auditing for quite a lot of industries together with banking, insurance coverage, distribution, vitality, mining, manufacturing, know-how, and never for revenue and governmental entities. Mr. Gianola is a member of the Board of Administrators of The Well being Plan, Proof Motion and the West Virginia Housing Growth Fund. Mr. Gianola holds a Bachelor of Science diploma in enterprise administration in accounting from West Virginia College and is a member of the American Institute of Licensed Public Accountants, the West Virginia Society of Licensed Public Accountants, the Board of Advisors of The School of Enterprise and Economics at West Virginia College and the vice-chairman of the Board of Administrators of the West Virginia College Basis. Mr. Gianola is the chairman of the Audit and Compliance Committee and a member of the Compensation and Nominating Committee, the Fairness Compensation Committee and the Asset/Legal responsibility and Funds Administration Committee.

John H. Shott has served as a member of the Board of Administrators of the Firm and Summit’s banking subsidiary since April 2017. Mr. Shott practiced legislation from September 1975 till 2015. Mr. Shott served as a member of the West Virginia Home of Delegates from 2010 by way of 2020 and was Chairman of its Judiciary Committee from 2014 by way of 2020. Mr. Shott served on the previous First Century Bankshares, Inc. Board of Administrators since 1999 the place he served as a member of its Compensation Committee and the Belief Committee of First Century Financial institution, First Century Bankshares, Inc.’s banking subsidiary. Mr. Shott brings to our Board related expertise with authorized and regulatory compliance points. Mr. Shott obtained his legislation diploma from the College of North Carolina, Chapel Hill. Mr. Shott can be a member of the Board of Administrators of a number of non-profit entities and neighborhood organizations. Mr. Shott is a member of the Asset/Legal responsibility and Funds Administration Committee and the ESOP/401(Ok) Committee.


Persevering with Administrators Whose Phrases Expire in 2024

Title

Age as of the Might 19, 2022

Assembly Date

Yr First

Elected Director

James M. Cookman 68 1994
Gary L. Hinkle 72 1993
Jason A. Kitzmiller 48 2018
H. Charles Maddy 59 1993
Ronald B. Spencer 69 2020

James M. Cookman has served as a member of the Board of Administrators of the Firm since 1994 and served as a member of the Board of Administrators of Summit’s banking subsidiary from 1994 to 2008. Mr. Cookman was reappointed as a member of the Board of Administrators of Summit’s banking subsidiary in Might, 2011 and has served in that capability since that point. Mr. Cookman has over 4 a long time of various enterprise expertise within the areas of insurance coverage, renewable vitality and communications and at the moment serves because the President of Cookman Insurance coverage Group, Inc., an Unbiased Insurance coverage Company, is a member supervisor of Laurel Renewable Companions, LLC, a renewable vitality growth firm, and is a member of the board of administrators of two farm mutual insurance coverage firms, Mutual Protecting Affiliation of West Virginia, and West Virginia Farmers Mutual Insurance coverage Affiliation. Mr. Cookman is politically energetic on the native and state ranges and is actively concerned in neighborhood initiatives, together with his service as regional board member of the American Purple Cross, instant Previous President of the Potomac Highlands Shrine Membership, and a member of the Jap West Virginia Group and Technical School Basis Board of Administrators. Mr. Cookman is a member of the Compensation and Nominating Committee, the Fairness Compensation Committee and ESOP/401(Ok) committee.

Gary L. Hinkle has served as a member of the Board of Administrators of the Firm since 1993 and has served as a member of the Board of Administrators of Summit’s banking subsidiary since 1993. Mr. Hinkle is at the moment the President of Hinkle Trucking, Inc., Dettinburn Transport, Inc., Mt. Storm Gas Inc., and H. T. Companies, Inc. Mr. Hinkle acquired his Bachelor of Science in enterprise administration from West Virginia College and has 31 years of expertise in proudly owning and working his personal enterprise. Mr. Hinkle serves as a member of the Government Committee, the Audit and Compliance Committee, the Asset/Legal responsibility and Funds Administration Committee, the Compensation and Nominating Committee and Chairman of the Fairness Compensation Committee.

Jason A. Kitzmiller has served as a member of the Board of Administrators of the Firm since 2018. Mr. Kitzmiller serves as president of A.L.L. Development Inc., specializing in excavating and utility contracting in WV, MD, PA and VA, the place he’s actively concerned in each day administration, monetary and operational choices. Mr. Kitzmiller is the vice-president of ALL Development and Excavating LLC and in addition serves as managing member of Alleghany Investments LLC and OSA Enterprises LLC. As well as, Mr. Kitzmiller is president of D.P. Southbound LLC and ALL Concrete Inc. and is the only real proprietor of ALL Outdoor, LLC. Mr. Kitzmiller served within the U.S. Navy as an plane mechanic and was honorably discharged. Mr. Kitzmiller acquired his Bachelor of Science diploma in civil engineering from West Virginia College and has over 27 years of building associated expertise. Mr. Kitzmiller is previous president and present board member of the West Virginia Development Labor Council and a member of the West Virginia Contractors Affiliation. Mr. Kitzmiller may be very energetic in youth sports activities and is the vice-president and board member of Grant County Little League Basketball and board member of the Grant County Little League Baseball. Mr. Kitzmiller serves as a member of the Firm’s Audit and Compliance Committee and the Asset/Legal responsibility and Funds Administration Committee.


H. Charles Maddy, III has served as a member of the Board of Administrators since 1993 and has served as a member of the Board of Administrators of Summit’s banking subsidiary, Summit Group Financial institution, since 1993. Mr. Maddy is at the moment the President and Chief Government Officer of the Firm, and has served on this capability since 1994. Mr. Maddy has demonstrated distinctive management by way of his participation in quite a lot of skilled and neighborhood service actions, together with his service as Director and previous President of the West Virginia Bankers’ Affiliation, chairman of its Audit Committee and member of its Legislative/Authorities Relations Committee, Pension & Advantages Committee and BankPAC Committee; member of American Bankers Affiliation and serves on its Federal Dwelling Mortgage Financial institution Open Committee; Director and a Founding father of the Hardy County Baby Care Heart; Director of Valley View Golf Affiliation; serves on the Board of Trustees of the Jap West Virginia Group and Technical School Basis; a previous Director and Vice-Chairman of the Federal Dwelling Mortgage Financial institution of Pittsburgh and previous Chairman of its Audit Committee; previous President and previous Director of the West Virginia Affiliation of Group Bankers and previous Director of the Hardy County Group Basis. Mr. Maddy has additionally been acknowledged as a pacesetter in his business and has been the recipient of the Excellent CPA in Enterprise and Trade Award and the AICPA Enterprise and Trade Corridor of Fame Award. Mr. Maddy acquired his Bachelor of Science diploma in enterprise administration with a focus in accounting from Harmony School. Mr. Maddy is a member of the Government Committee, the Asset/Legal responsibility and Funds Administration Committee and the ESOP/401(Ok) Committee.

Ronald B. Spencer has served as a member of the Board of Administrators of the Firm and Summit’s banking subsidiary since January 1, 2020.  Mr. Spencer is the proprietor and president of Mid-Atlantic of West Virginia, Inc. and proprietor and supervisor of Spencer Enterprises.  Mr. Spencer is the previous proprietor and president of Eagle Aviation, Yeager Airport and former vp of Government Air, Yeager Airport.  Mr. Spencer served as Director and Chairman of the Board of Administrators of the previous Cornerstone Monetary Companies, Inc. from 2003 to 2019 and served as a member of the Board of Administrators of Cornerstone’s banking subsidiary, Cornerstone Financial institution, Inc., from 2006 till 2019.  He additionally served as Chairman of Cornerstone’s Audit Committee.  Inclusive of Mr. Spencer’s service on the board of the predecessor financial institution to Cornerstone, Mr. Spencer has maintained 40 years mixture expertise as a financial institution board member. Mr. Spencer earned a Bachelor of Science diploma in political science from West Virginia College and attended Camden Navy Academy, Camden, South Carolina.  Mr. Spencer was appointed to the West Virginia Board of Schooling in November 1999 by Governor Cecil H. Underwood to a time period ending November 4, 2008 and was elected secretary of the West Virginia Board of Schooling in 2002 and 2007.  He was additionally elected to the Doddridge County Fee serving 1989-1995.  Moreover, Mr. Spencer was previously a member of the West Virginia College Boards Affiliation; Board of Administrators, and served 15 years as a board member of the Secondary Faculties Actions Fee.   Mr. Spencer can be concerned with a number of non-profit entities and neighborhood organizations.  Mr. Spencer is a member of the Audit and Compliance Committee and the Asset/Legal responsibility and Funds Administration Committee.

Retirement of Administrators

Dewey F. Bensenhaver is retiring from the Board of Administrators. The Firm’s retirement coverage requires that every one Administrators retire on the finish of the time period throughout which the Director attains the age of 75. Mr. Bensenhaver served as a member of the Board of Administrators of the Firm since 2000 and served as a member of the Board of Administrators of Summit’s banking subsidiary from 1998 to 2008.  Dr. Bensenhaver was reappointed as a member of the Board of Administrators of Summit’s banking subsidiary in Might 2011. We’re grateful to Mr. Bensenhaver for his steerage and devoted service to the Firm and we thank him for his dedication of time and expertise.


Household Relationships

There aren’t any household relationships between any director, govt officer or nominee for director.


EXECUTIVE OFFICERS

The Government Officers of the Firm as of March 30, 2022 are listed under together with their current place and expertise throughout a minimum of the previous 5 years. Government Officers are elected yearly by the Board of Administrators and serve on the pleasure of the Board.

H. Charles Maddy, III, age 59, has served as a member of the Board of Administrators since 1993 and has served as a member of the Board of Administrators of Summit’s banking subsidiary, Summit Group Financial institution, since 1993. Mr. Maddy is at the moment the President and Chief Government Officer of the Firm, and has served on this capability since 1994.

Robert S. Tissue, age 58, has served as Government Vice President and Chief Monetary Officer of Summit Monetary Group since 1998.

Scott C. Jennings, age 60, has served as Government Vice President and Chief Working Officer of Summit Monetary Group since 2000.

Patrick N. Frye, age 63, has served as Government Vice President and Chief of Credit score Administration of Summit Monetary Group since December 2003.

Bradford E. Ritchie, age 54, has served as Government Vice President of Summit Monetary Group and President of Summit Group Financial institution since 2012.

Patricia L. Owens, age 58, has served as Government Vice President and Chief Banking Officer of Summit Monetary Group since Might 2019 and Chief Banking Officer of Summit Group Financial institution since 2014.

Danyl R. Freeman, age 51, has served as Government Vice President and Chief Human Sources Officer of Summit Monetary Group since Might 2019 and served as Senior Vice President and Chief Human Sources Officer of Summit Group Financial institution since 2015.


ITEM 2 – ADOPTION OF NON-BINDING RESOLUTION TO APPROVE THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS

The Dodd-Frank Wall Road Reform and Shopper Safety Act, enacted in July 2010, requires that we offer our shareholders with the chance to vote to approve, on a non-binding, advisory foundation, the compensation of our named govt officers as disclosed on this proxy assertion in accordance with the compensation disclosure guidelines of the Securities and Alternate Fee.

The manager officers named within the abstract compensation desk set forth on this proxy assertion and deemed to be the Firm’s “named govt officers” are H. Charles Maddy, III, Robert S. Tissue, Scott C. Jennings, Patrick N. Frye and Bradford E. Ritchie.

Shareholders are urged to learn the compensation info on the next pages of this proxy assertion which discusses the compensation insurance policies and procedures with respect to the Firm’s named govt officers and vote on the next advisory, non-binding decision:

“RESOLVED, that the shareholders approve, on an advisory foundation, the compensation paid to Firm’s named govt officers, as disclosed on this proxy assertion pursuant to the compensation disclosure guidelines of the Securities and Alternate Fee, together with the Compensation Dialogue and Evaluation, the compensation tables and narrative dialogue.”

As described intimately below the headings “Compensation Dialogue and Evaluation” and “Government Compensation” starting on web page 29, we search to intently align the pursuits of our named govt officers with the pursuits of our shareholders. Our compensation applications are designed to reward our named govt officers for the achievement of the Firm’s monetary objectives, whereas on the similar time avoiding the encouragement of pointless or extreme threat taking. As well as, the Firm’s Compensation and Nominating Committee (the “Committee”) has reviewed the Firm’s compensation insurance policies and believes that the Firm’s insurance policies don’t promote pointless risk-taking nor are they fairly more likely to have a fabric adversarial impact on the Firm.

This advisory vote, generally known as a “say-on-pay” advisory vote, is non-binding on the Board of Administrators. Though non-binding, the Board of Administrators and the Committee worth constructive dialogue on govt compensation and different essential governance subjects with shareholders. The Board of Administrators and the Committee will assessment the voting outcomes and take them into consideration when making future choices relating to the Firm’s govt compensation applications.

The Board of Administrators and the Committee recommends a vote FOR the nonbinding decision to approve the compensation of the Firm’s named govt officers.


COMPENSATION DISCUSSION AND ANALYSIS

This part explains Summit’s govt compensation program because it pertains to the next named govt officers (outlined because the CEO, CFO and the three most extremely compensated Government Officers aside from the CEO) as of December 31, 2021:

H. Charles Maddy, III President and Chief Government Officer
Robert S. Tissue Government Vice President and Chief Monetary Officer
Patrick N. Frye Government Vice President and Chief of Credit score Administration
Scott C. Jennings Government Vice President and Chief Working Officer
Bradford E. Ritchie President – Summit Group Financial institution

Government Compensation Program

Now we have a simple compensation program that focuses on a group method and helps long-term methods of the Firm. Every of our named govt officers should reveal distinctive private efficiency for a sustained time frame to stay a part of our govt group. As a member of that group, every officer should contribute to the general success of Summit somewhat than merely attain objectives inside that officer’s particular space of accountability.

Our compensation program contains efficiency metrics that promote disciplined progress in direction of each short-term and long-term objectives and that correlate to the profitability goals of and applicable threat to the Firm. The mix of performance-based compensation and equity-based awards, which derive their profit from will increase in shareholder worth, offers the vast majority of our govt officers’ whole compensation and furthers our core compensation precept of offering pay for each particular person and Firm-wide efficiency. The manager compensation program was designed and accepted by the Compensation and Nominating Committee of the Board of Administrators (the “Committee”) and the Board of Administrators of the Firm.

Our govt compensation program is designed to:

•    retain govt officers by paying them competitively, encourage them to contribute to the Firm’s success, and reward them for his or her efficiency;

•    reward govt officers by way of annual performance-based compensation primarily based on the achievement of particular working objectives which were decided by the Committee;

•    align the compensation of the chief officers with the pursuits of our shareholders and encourage the chief officers to realize the Firm’s long-term objectives by way of equity-based compensation;

•    preclude extreme and pointless risk-taking by govt officers; and

•    encourage possession of Firm widespread inventory by govt officers.


Our basic philosophy is to hyperlink intently govt compensation with the achievement of annual monetary efficiency objectives. It’s the Firm’s apply to offer a mixture of money and equity-based compensation that the Firm believes balances the perfect pursuits of the Firm’s executives and the Firm’s shareholders. The Firm believes compensation ought to be structured to make sure that a good portion of the compensation alternative might be instantly associated to shareholder worth.

As mentioned under, this system consists of, and is meant to stability, three components:

•    Salaries

Salaries are primarily based on the Firm’s analysis of particular person job efficiency and an evaluation of the salaries and whole compensation combine paid by the Firm’s Peer Group to govt officers holding equal positions. The Firm’s Peer Group is a bunch consisting of all public banks and thrifts in the USA with belongings of $1 billion – $5 billion. The Firm doesn’t “benchmark” to the Peer Group, however somewhat makes use of the Peer Group as a common reference for functions of evaluating our govt officer salaries to different firms within the business to find out whether or not the salaries are affordable and aggressive.

•    Incentive compensation

Government Incentive Compensation relies on an analysis of each particular person and Firm efficiency in opposition to quantitative measures.

•    Lengthy-term Incentive Compensation

Lengthy-term incentive awards, which include inventory appreciation rights and restricted inventory items issued below the Firm’s 2014 Lengthy-Time period Incentive Plan which was accepted by the Firm’s shareholders, are designed to make sure that incentive compensation is linked to the long-term efficiency of the Firm and to the returns to its widespread shareholders.

Setting Government Compensation

In setting the annual base wage and the efficiency objectives that have to be happy for executives to obtain incentive compensation, the Firm critiques govt compensation info from the Peer Group gathered from SEC filings and the S&P World Market Intelligence 2021 Government Compensation Evaluation for Financial institution and Thrift Corporations, a compensation survey that features two years of govt compensation info for U.S.-based banks and thrifts categorised in accordance with legacy SNL business construction, whose proxy supplies are filed with the SEC and publicly obtainable as of July 9, 2021 for the fiscal 12 months 2020. The Firm doesn’t use a selected formulation to set pay in relation to this market knowledge. This market knowledge is used as a software to evaluate whether or not the Firm’s govt compensation is affordable and aggressive throughout the business. The Firm doesn’t, nonetheless, try and set compensation to fulfill particular benchmarks, resembling salaries “above the median” or fairness compensation “on the 75th percentile”. The Firm strongly believes in retaining the perfect expertise for all important Firm capabilities and this may increasingly or could not lead to compensation packages that align on the median of the Peer Group. The Firm additionally believes that extreme reliance on benchmarking is detrimental to shareholder pursuits as a result of it may end up in compensation that’s unrelated to the worth delivered by the named govt officers.

Salaries. The primary factor of the chief compensation program is salaries.


The Board and the Firm have directed a mixture of the Firm’s govt compensation that gives a chance for vital variation in whole compensation primarily based on efficiency with a proportionately lesser emphasis on salaries. This technique is meant to extend the efficiency orientation of the Firm’s govt compensation.

In setting the bottom wage for the President and CEO and in reviewing and approving the salaries for the opposite named govt officers, the Firm first critiques the historical past of the compensation for every particular person, together with money and equity-based elements. In setting salaries, the Firm and the Committee don’t use a predetermined formulation. As a substitute, the salaries of the President and CEO and the opposite govt officers are primarily based on:

•    the Committee’s assessment of the CEO’s analysis of every officer’s particular person job efficiency, and the Committee’s analysis of the CEO’s job efficiency;

•    an evaluation of the Firm’s efficiency;

•    the perquisites offered to the CEO and different named govt officers;

•    a consideration of salaries paid by the Peer Group to govt officers holding equal positions;

•    a consideration of mixture quantity of all elements of compensation paid to the President and CEO and different govt officers; and

•    the complexity of the job duties of the indicated govt as in comparison with the perceived complexity of the duties of comparable executives in different firms.

We wouldn’t have a pre-defined framework that determines which of those elements could also be kind of essential and the emphasis positioned on particular elements could differ among the many named govt officers. In the end it’s the Committee’s judgment of those elements together with the comparative compensation knowledge that type the idea for figuring out the named govt officers’ compensation. As soon as the bottom wage is ready, it doesn’t depend upon the Firm’s efficiency. In 2021, the Firm elevated the bottom salaries of its named govt officers as follows:

•    4.68% enhance within the wage of Mr. Maddy, 5.96% enhance within the wage of Mr. Tissue, 5.80% enhance within the wage of Mr. Frye, 5.96% enhance within the wage of Mr. Jennings, and 6.03% enhance within the wage of Mr. Ritchie for his or her vital contribution to the general administration of the Firm.

Incentive Compensation. The second factor of the chief compensation program is incentive compensation. The aim of creating an annual incentive compensation plan is to encourage and reward eligible staff for his or her contributions to the Firm and its financial institution subsidiary by making a big portion of their money compensation variable and dependent upon the Firm’s and its financial institution subsidiary’s efficiency.

On February 11, 2021, the Committee accepted phrases of the Firm’s Government Officer Administration Incentive Plan for 2021. The 2021 Government Officer Administration Incentive Plan offered govt officers of the Firm with the chance to earn a bonus cost various between 15 to 30 % of the chief officer’s base wage as of January 1, 2021 multiplied by a multiplier primarily based on the Firm’s annual return on common tangible fairness (“ROATE”) for 2021. The focused vary for the Firm’s ROATE for 2020 was 12.5 to 13.49 %. If the Firm’s precise ROATE for 2021 would have been inside this focused vary, every govt officer would have acquired an incentive cost between 15 to 30 % of their respective annual base wage as of January 1, 2021 (the “Focused Incentive”).


If the Firm’s precise ROATE for 2021 would have been larger than the focused vary, govt officers would have been eligible to obtain an incentive that’s larger than the Focused Incentive; conversely, if the Firm’s precise ROATE for 2021 would have been lower than the focused vary, govt officers would have been eligible to obtain an incentive that’s lower than the Focused Incentive. No incentive funds would have been made if the Firm’s precise ROATE would have been lower than 10.5%.

As well as, no incentives would have been made below the Government Officer Administration Incentive Plan for 2021 if at December 31, 2021 by way of the time of cost of the motivation in 2022, the Firm or any affiliate was topic to any energetic or pending, formal or casual, settlement or enforcement motion to which any financial institution regulatory authority was a celebration, together with, however not restricted to a memorandum of understanding, written settlement, or order of stop and desist.

The Firm’s precise ROATE for 2021 was 18.71%; accordingly, named govt officers have been awarded the next incentive funds: H. Charles Maddy, III – $304,425; Robert S. Tissue – $169,290; Patrick N. Frye $136,620; Scott C. Jennings $169,290; and Bradford E. Ritchie $187,110.

Lengthy-term Incentive Compensation. The third factor of the chief compensation program is long-term incentive compensation.

2014 Lengthy-Time period Incentive Plan. The principle element of the long-term incentive compensation program is the 2014 Lengthy-Time period Incentive Plan (the “2014 LTI Plan”) that was adopted by the Firm’s shareholders on the 2014 Annual Assembly of shareholders and amended by the Firm’s shareholders on the 2021 Annual Assembly of shareholders to extend the variety of shares of the Firm’s widespread inventory that could be issued below the 2014 LTI Plan.

Objective of the 2014 LTI Plan. The aim of the 2014 LTI Plan is to reinforce the power of the Firm to draw and retain exceptionally certified people to function key staff to the Firm, together with full-time worker administrators, who will contribute to the Firm’s success, to encourage such people to accumulate a proprietary curiosity within the development and efficiency of the Firm which can inure to the good thing about all shareholders of the Firm, and to reward the efficiency of those people in fulfilling their private tasks for long-range and annual achievements.

Shares Out there for Awards. The utmost variety of shares of the Firm widespread inventory which can be issued below the 2014 LTI Plan is 800,000, topic to adjustment by the Committee for inventory splits and different occasions as set forth within the 2014 LTI Plan. If, after the efficient date of the 2014 LTI Plan, (i) any shares coated by an award below the 2014 LTI Plan, or to which such an award relates, are forfeited or (ii) any award below the 2014 LTI Plan expires or is cancelled or in any other case terminated, then the variety of shares obtainable for issuance below the 2014 Plan will enhance, to the extent of any such forfeiture, expiration, cancellation or termination. If the Committee grants substitute awards, that are awards granted in assumption of, or in substitution for, excellent awards beforehand granted by an organization that’s acquired by the Firm in a merger or different enterprise mixture, then such substitute awards won’t depend towards the utmost variety of shares obtainable below the 2014 LTI Plan.

Eligibility. All grants are anticipated to be made on a discretionary foundation, somewhat than pursuant to a formulation. Any key worker or full-time worker director of the Firm and its associates might be eligible to obtain grants below the 2014 LTI Plan. A key worker means any officer or different key worker of the Firm or any affiliate who’s liable for or contributes to the administration, development, or profitability of the enterprise of the Firm or any affiliate as decided by the Committee. An eligible employee-director means every member of the Board of Administrators who’s a full-time worker or officer of the Firm or any affiliate.


Awards. All awards below the 2014 LTI Plan are anticipated to be evidenced by an award settlement between the Firm and the person participant and accepted by the Committee. Within the discretion of the Committee, an eligible key worker, govt officer or full-time employee-director could obtain awards from a number of classes described under, and a couple of award could also be granted to an eligible key worker, govt officer or full-time employee-director.

    Kinds of awards below the 2014 LTI Plan embody:

Inventory Appreciation Rights and Inventory Choices. Topic to the phrases of the 2014 LTI Plan, the Committee could grant to contributors inventory appreciation rights (SARs) and inventory choices with such phrases and situations because the Committee determines. A SAR Award Settlement could specify a selected settlement date or dates, or could grant a time period throughout which such SAR or SARs, if vested, could also be exercised. If the SAR Award Settlement grants a participant a time period throughout which vested SARs could also be exercised by the Participant, the Participant could train any such SAR with respect to any or all a part of the variety of vested SARs then exercisable below the phrases of the written SAR Award Settlement by giving the Committee written discover of intent to train. When granting SARs, the Committee should repair the time period or date of settlement of every SAR, however such date could not exceed 10 years from the date of grant. Holders of SARs wouldn’t have rights of a shareholder.

On the time of grant of a inventory possibility, the Committee will decide whether or not the choice might be a non-qualified or an incentive inventory possibility, offered that incentive inventory choices will solely be granted to key staff. The phrases of any incentive inventory possibility shall comply in all respects with the provisions of Code Part 422. Every inventory possibility granted below the 2014 LTI Plan might be evidenced by an Possibility Award Settlement between the Firm and the participant and such Possibility Award Settlement will comprise the variety of shares and the phrases on which the choice could be exercised.

The date of grant won’t be sooner than the date on which the Committee approves such grant. The train worth per share shall be decided by the Committee; offered, nonetheless, that besides within the case of substitute awards, the train worth won’t be lower than 100% of the honest market worth of the Firm’s widespread inventory on the date the inventory possibility is granted, and within the case of incentive inventory choices granted to any participant that owns greater than ten % of the Firm, the train worth might be a minimum of 110% of the honest market worth of the Firm’s widespread inventory on the date of grant.

In April 2015, February 2017, February 2019 and February 2021, the Board of the Firm accepted awards of stock-settled inventory appreciation rights to named govt officers in accordance with the phrases of the 2014 LTI Plan.  The entire stock-settled inventory appreciation rights expire ten years from the date of grant. The stock-settled inventory appreciation rights granted are time-based, with 20% vesting on every of the primary 5 anniversaries of the grant date. As of March 30, 2022, Named Government Officers held 140.079.4 vested stock-settled inventory appreciation rights. The stock-settled inventory appreciation rights might be settled in shares of the Firm’s widespread inventory.

Within the occasion of a change of management, as outlined within the LTI Plan, if the successor or surviving company so agrees, some or all the excellent stock-settled inventory appreciation rights might be assumed or changed with the identical sort of award with comparable phrases or situations. Any stock-settled inventory appreciation rights that aren’t absolutely vested on the time a recipient terminates employment as a result of a change of management will change into absolutely vested upon such termination and stay exercisable, all through the unique time period of the award.


If the recipient’s employment with the Firm is terminated as a result of dying or incapacity, then the recipient will vest within the further proportion of stock-settled inventory appreciation rights, if any, that may have vested on the vesting date which falls after the date of dying or date of termination of employment of recipient as a result of incapacity, however throughout the calendar 12 months during which the recipient died or terminated employment as a result of incapacity, as if, for functions of vesting proportion solely, the recipient had not died or terminated employment as a result of incapacity, and had continued employment to such vesting date. All vested stock-settled inventory appreciation rights might be exercisable for a interval of two years from the date of dying or termination of employment as a result of incapacity; all vested stock-settled inventory appreciation rights not exercised inside mentioned two-year interval might be forfeited of their entirety.

If the recipient is terminated by the Firm for trigger, then the stock-settled inventory appreciation rights will instantly terminate and no stock-settled inventory appreciation rights might be exercisable as of the date of such termination, no matter whether or not any stock-settled inventory appreciation proper was vested and exercisable previous to date of such termination.

Upon termination of the recipient’s employment by the Firm or by the recipient aside from for dying, incapacity or termination for trigger, the stock-settled inventory appreciation rights, to the extent vested and exercisable as of the date of such termination, will thereafter be exercisable just for a interval of two years (with respect to the 2015 grants) or ninety (90) days (with respect to the 2017, 2019 and 2021 grants) from the date of such termination, and any stock-settled inventory appreciation proper that was not exercisable as of the date of such termination might be forfeited.

If, at any time inside (i) the ten-year time period of award settlement; (ii) two years after the termination of employment; or (iii) two years after the recipient workout routines any portion of the grant of stock-settled inventory appreciation rights, whichever is the most recent, the recipient, within the willpower of the Committee, engages in any exercise in competitors with any exercise of the Firm, or inimical, opposite or dangerous to the pursuits of the Firm, together with, however not restricted to these circumstances set forth within the award settlement, then any award of stock-settled inventory appreciation rights held by the recipient will terminate efficient as of the date on which the recipient enters into such exercise, except terminated sooner by operation of one other time period or situation of the award settlement or the Plan, and any achieve realized by the recipient from the train of all or a portion of any grant of inventory appreciation rights might be repaid by the recipient to the Firm. Such achieve might be calculated primarily based on the unfold multiplied by the variety of shares topic to the stock-settled inventory appreciation rights exercised on such date, plus curiosity measured from the primary date the recipient engaged in any of the prohibited actions set forth above on the highest fee allowable below West Virginia legislation.

Restricted Inventory and Restricted Inventory Items. Topic to the phrases of the 2014 LTI Plan, the Committee could grant with respect to every restricted inventory or restricted inventory unit award, the variety of shares or restricted inventory items, respectively, with respect to which such award relates.

Shares of restricted inventory and restricted inventory items might be topic to such restrictions because the Committee could impose (together with, with out limitation, any limitation on the precise to vote a share of restricted inventory or the precise to obtain any dividend or different proper or property), which restrictions could lapse individually or together at such time or instances, in such installments or in any other case, because the Committee could deem applicable.

The Committee will decide the way during which restricted inventory might be evidenced, together with, with out limitation, book-entry registration or issuance of a inventory certificates or certificates. Within the occasion any inventory certificates is issued in respect of shares of restricted inventory, such certificates shall be registered within the title of the participant and shall bear an applicable legend (as decided by the Committee) referring to the phrases, situations, and restrictions relevant to such restricted inventory.


Throughout 2019, 2020 and 2021, the Board of the Firm accepted awards of an mixture of 18,150 shares of restricted inventory items to key staff. Not one of the restricted inventory items have been granted to named govt officers.

With respect to restricted inventory and restricted inventory items, besides as in any other case decided by the Committee, upon termination of employment or cessation of the supply of providers (as decided below standards established by the Committee) for any purpose through the relevant restriction interval, all shares of restricted inventory and all restricted inventory items nonetheless topic to restriction might be forfeited and reacquired by the Firm except in any other case decided by the Committee {that a} waiver can be in the perfect pursuits of the Firm.

Government Wage Continuation Agreements and Supplemental Plans. In an effort to draw, reward, encourage and retain essentially the most certified individuals obtainable, and to offer these individuals with an entire and affordable compensation package deal, Summit and its banking subsidiary have entered into Government Wage Continuation Agreements (“Continuation Agreements”) with sure executives of the Firm with an endorsement break up greenback life insurance coverage plan. On this part, Firm contains Summit’s financial institution subsidiary.

The Continuation Agreements have been designed to offer an annual outlined retirement profit payable for the lifetime of the chief. These advantages, when added to the retirement advantages that might be offered by the Firm’s 401(ok) Outlined Contribution Plan, Worker Inventory Possession Plan, and social safety, will present every govt with profit ranges akin to different Firm staff when measured as a proportion of wage on the time of retirement. The retirement age for every named govt officer below the Continuation Agreements are as follows: H. Charles Maddy, III and Scott C. Jennings – age 63; and Robert S. Tissue, Patrick N. Frye and Bradford E. Ritchie – age 65.

The Continuation Agreements are designed to be a retention software, however they do have in mind the age of the named govt officers. With respect to the Firm’s President and Chief Government Officer, Mr. Maddy, the advantages below his Continuation Settlement vest at a fee of 5 % per 12 months within the first ten years, zero % in 12 months eleven by way of eighteen, and in 12 months nineteen, the remaining fifty % vests. With respect to Mr. Frye, Mr. Jennings and Mr. Tissue, the advantages below their Continuation Settlement vest at a fee of 5 % per 12 months within the first ten years, zero % in 12 months eleven by way of nineteen, and in 12 months twenty, the remaining fifty % vests. With respect to Mr. Ritchie, the advantages below his Continuation Settlement vest at a fee of zero % in 12 months one by way of 4, twenty-five % in 12 months 5, 5 % per 12 months in years six by way of ten, zero % in 12 months eleven by way of nineteen, and in 12 months twenty, the remaining fifty % vests. Vesting is measured for every govt from the efficient date of the Continuation Agreements, which differ by govt.

The Firm’s obligations below the retirement profit portion of those agreements are unfunded; nonetheless, the Firm has bought life insurance coverage insurance policies on every insurable govt which might be actuarially designed to offset the annual bills related to the agreements and can, given affordable actuarial assumptions, offset all the prices of the agreements through the lifetime of the chief and supply an entire restoration of all prices on the govt’s dying. The Firm is the only real proprietor of all insurance policies and as Firm belongings, the insurance policies are topic to claims of the Firm’s common collectors.

The life insurance coverage profit for every insurable officer is being offered by an Endorsement Cut up Greenback Plan whereby the Firm endorses a specified proportion of the net-at-risk life insurance coverage portion of a coverage (whole dying profit much less money worth of coverage) on the life of every officer for cost to the designated beneficiary of that officer. The Firm owns the coverage and its whole give up worth.


For every of the named govt officers, the annual lifetime advantages payable upon retirement at regular retirement age below the Continuation Agreements are as follows: H. Charles Maddy, III – $175,000; Robert S. Tissue – $125,000; Scott C. Jennings – $125,000; Patrick N. Frye – $125,000; and Bradford E. Ritchie – $125,000.

On July 23, 2020, the Board of Administrators adopted Supplemental Government Retirement Plans (“Supplemental Plans”) for the good thing about sure key officers of the Firm, together with the named govt officers. The aim of the Supplemental Plans is to incent these key officers to stay employed by the Firm till their retirement. Below the Supplemental Agreements, the traditional retirement age for every named govt officer are as follows: H. Charles Maddy, III and Scott C. Jennings – age 63; and Robert S. Tissue, Patrick N. Frye and Bradford E. Ritchie – age 65. No advantages below the Supplemental Plans vest till the important thing officers, together with the named govt officers, attain their respective retirement age below their plan.

The Supplemental Plans present the next annual lifetime advantages payable upon retirement at regular retirement age for the named govt officers: H. Charles Maddy, III: $73,000; Robert S. Tissue: $25,000; Patrick N. Frye: $10,000; Scott C. Jennings: $25,000; and Bradford E. Ritchie: $50,000. The Supplemental Plans are along with the Continuation Agreements between the Firm and the named govt officers.

Perquisites

Typically, the Firm offers modest perquisites or private advantages, and solely with respect to advantages or providers which might be designed to help a named govt officer in being productive and centered on his or her duties, and which administration and the Committee consider are affordable and in step with the Firm’s total compensation program. Administration and the Committee periodically assessment the degrees of perquisites or private advantages offered to named govt officers.

Plans Protecting All Workers

Worker Inventory Possession Plan. The Firm additionally maintains an Worker Inventory Possession Plan (ESOP) which covers considerably all staff. Any worker who’s a minimum of 21 years of age and is credited with a minimum of 1,000 hours of service through the plan 12 months is eligible to take part. Vesting happens on the fee of 0% for the primary 12 months of credited service and 20% for the following 5 years thereafter. Below the provisions of the ESOP, worker contributors within the ESOP should not permitted to contribute to the ESOP, somewhat the price of the ESOP is borne by the Firm by way of annual contributions in quantities decided by the Firm’s Board of Administrators. Discretionary contributions have been made by the Firm for 2021 of 5%.

401(ok) Outlined Contribution Plan. The Firm has an outlined contribution plan with 401(ok) provisions overlaying considerably all staff. Any worker (aside from a leased worker, proprietor worker, seasonal worker, or different worker who is just not a typical legislation worker) who’s a minimum of 21 years of age is eligible to take part. If the eligibility necessities are met, an worker could change into a participant on the following semi-annual entry date of January 1st or July 1st. The worker is eligible for employer contributions after the worker has a minimum of 12 months of service. Below the provisions of the plan, the Firm matches 100% of the participant’s wage discount contributions, as much as 4% of such participant’s compensation. These matching contributions shall be absolutely vested always. The Firm can also make optionally available contributions on the discretion of the Firm’s Board of Administrators. Vesting of discretionary contributions happens on the fee of 0% for the primary 12 months of credited service, and 20% for the following 5 years thereafter. No discretionary contributions have been made by the Firm for 2021.


Potential Funds Upon Termination or Change of Management

The Firm has entered into Employment Agreements with the named govt officers with a purpose to guarantee continuity of administration of the Firm and to retain the pool of expertise the Firm has developed in a aggressive market. The Board of Administrators decided that such preparations have been applicable, particularly in view of the entry of huge regional financial institution holding firms into West Virginia. The Agreements weren’t undertaken within the perception {that a} change of management of the Firm was imminent.

Typically, the Firm selected specific occasions for triggering funds primarily based on the usual apply within the business on the time the actual settlement was negotiated, the general reasonableness of the expense to the Firm related to a selected triggering occasion, and whether or not the precise provision would have a fabric impression on the marketability of the Firm ought to the Board of Administrators consider a sale of the Firm have been in the perfect curiosity of its shareholders. The next summaries set forth potential funds to our named govt officers upon termination of employment or change of management of the Firm below their present employment agreements and our different compensation applications.

Employment Settlement — Mr. Maddy. On March 4, 2005, the Firm entered into an Employment Settlement (the “Employment Settlement”) and a Change in Management Settlement (the “Change in Management Settlement”) with H. Charles Maddy, III, Chief Government Officer of Summit. On December 31, 2008, the Employment Settlement and Change in Management Settlement have been amended and restated to adjust to Inner Income Code Part 409A. Below the phrases of the Employment Settlement, Summit will assessment the Employment Settlement yearly and will, with the approval of Mr. Maddy, prolong the time period of the Employment Settlement yearly for extra one-year intervals (in order that the precise time period of the Employment Settlement will all the time be between two and three years). The time period of the Employment Settlement extends to March 4, 2025.

The Employment Settlement could also be terminated primarily based on one of many following:

•    By mutual settlement of the events

•    Upon the dying of Mr. Maddy

•    Upon the incapacity of Mr. Maddy

•    By Summit, for trigger (as outlined within the Employment Settlement)

•    Upon a Change of Management (as offered within the Change in Management Settlement)

•    By Mr. Maddy, upon materials breach by Summit

•    By Mr. Maddy, primarily based on insolvency not attributable to Mr. Maddy

Below the Employment Settlement, Mr. Maddy is entitled to sure termination funds. If Mr. Maddy is terminated by mutual settlement, then he’s entitled to obtain a termination cost equal to an quantity agreed to by the events. If Mr. Maddy is terminated for trigger primarily based usually on his gross negligence, then Mr. Maddy won’t obtain a termination cost. On this case, Mr. Maddy is entitled to his Base Wage in impact for the 12 months during which termination happens, just for such interval of his energetic full-time employment to the date of the termination.


If Mr. Maddy is terminated for trigger primarily based on his negligence, malfeasance, or misfeasance, then Mr. Maddy is entitled to obtain his Base Wage with out offset for compensation already paid previous to the efficient date of termination. If Mr. Maddy is terminated for dying or incapacity, Mr. Maddy is entitled to a few instances his Base Wage and upon termination for dying, Mr. Maddy’s household would obtain continuation of their medical insurance protection advantages on the identical phrases as they beforehand acquired for one 12 months. If Mr. Maddy terminates his employment primarily based on a fabric breach by Summit, then Mr. Maddy is entitled to an quantity equal to 2 instances his Base Wage in impact for the 12 months during which termination happens with out offset for compensation already paid previous to the efficient date of termination. If Mr. Maddy voluntarily terminates, and there’s no materials breach by Summit, then Mr. Maddy doesn’t obtain a termination cost. On this case, Mr. Maddy is entitled to his Base Wage in impact for the 12 months during which termination happens, just for such interval of his energetic full-time employment to the date of the termination.

If Mr. Maddy’s employment is terminated pursuant to the provisions of the Change in Management Settlement, then Mr. Maddy can be entitled to the compensation set forth within the Change in Management Settlement as described under.

Change In Management Settlement – Mr. Maddy. Below the Change in Management Settlement, after a Change of Management (as outlined under), Mr. Maddy is required to work for the buying firm for a interval of 1 12 months with a purpose to facilitate administration continuity and to advertise an orderly transition of possession (the “Transition Interval”). Upon expiration of this Transition Interval, Mr. Maddy is entitled to obtain a cost equal to a few instances the larger of (a) his Wage (as outlined within the Employment Settlement) in impact instantly previous to the date of consummation of the Change of Management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement. Below the Change in Management Settlement, Mr. Maddy has the choice to terminate inside six months of a Change of Management. On this case, Mr. Maddy can be entitled to a lump sum cost equal to seventy-five % (75%) of the larger of (a) his Wage in impact instantly previous to the date of consummation of the Change of Management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement.

If Mr. Maddy terminates his employment after the primary six months following the Change of Management, however earlier than completion of the Transition Interval (except such termination is for Good Purpose or as a result of his dying or incapacity), Mr. Maddy is just not entitled to a severance cost below the Change in Management Settlement.

If Mr. Maddy terminates for Good Purpose (as outlined under) or is terminated below circumstances constituting Wrongful Termination (as outlined within the Change in Management Settlement) through the Transition Interval, then Mr. Maddy can be entitled to a cost equal to a few instances the larger of (a) his Wage in impact instantly previous to the date of consummation of a Change of Management or (b) his Wage in impact on the date of termination of his Employment Settlement below the Change in Management Settlement. Mr. Maddy can be entitled to obtain cost of money incentive award, if any, below the Firm’s Annual Incentive Plan and persevering with participation in worker profit plans and applications resembling retirement, incapacity and medical insurance coverage for the variety of months between the date of his termination and the date that’s thirty-six (36) months after the date of consummation of the Change of Management.


If Mr. Maddy is terminated on account of incapacity or dying through the Transition Interval, Mr. Maddy would obtain a cost equal to a few instances the larger of (a) his Wage (as outlined within the Settlement) in impact instantly previous to the date of consummation of the Change of Management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement.

Below the Change in Management Settlement, Mr. Maddy agrees to not interact, instantly or not directly, within the enterprise of banking within the Restricted Space (as outlined within the Change in Management Settlement) for a interval of three years after expiration of the Transition Interval. If Mr. Maddy’s employment with Summit is terminated for any purpose aside from Mr. Maddy’s incapacity, retirement, Good Purpose, or termination at Mr. Maddy’s possibility, Mr. Maddy agrees that for a interval of 1 12 months, he won’t, instantly or not directly, interact within the enterprise of banking within the Restricted Space.

Below the Change in Management Settlement, a “Change of Management” is outlined in Inner Income Code Part 409A and the laws issued thereunder and contains:

•    a change within the possession of Summit which is outlined to happen on the date that anybody individual, or a couple of individual performing as a bunch, acquires possession of inventory of Summit that, along with inventory held by such individual or group, constitutes greater than 50% of the overall honest market worth or whole voting energy of the inventory of Summit,

•    a change within the efficient management of Summit, which is outlined to happen on (1) the date anybody individual, or a couple of individual performing as a bunch, acquires (or has acquired through the 12-month interval ending on the date of the latest acquisition by such individual or individuals) possession of inventory of Summit possessing 30% or extra of the overall voting energy of Summit, and in addition to happen on (2) the date a majority of members of Summit’s Board of Administrators is changed throughout any 12-month interval by administrators whose appointment or election is just not endorsed by a majority of the members of Summit’s Board of Administrators earlier than the date of the appointment or election, and

•    a change within the possession of a considerable portion of Summit’s belongings which is outlined to happen on the date that anybody individual, or a couple of individual performing as a bunch acquires (or has acquired through the 12-month interval ending on the date of the latest acquisition by such individual or individuals) belongings from Summit which have a complete gross honest market worth equal to or greater than 40% of the overall gross honest market worth of all the belongings of Summit instantly earlier than such acquisition or acquisitions. For this objective, gross honest market worth means the worth of the belongings of Summit, or the worth of the belongings being disposed of, decided with out regard to any liabilities related to such belongings.

Below the Change in Management Settlement, Mr. Maddy could voluntarily terminate his employment for Good Purpose which arises if one of many following happens together with a Change of Management:

•    a lower within the govt’s total compensation under the extent in impact instantly previous to the date of consummation of the change of management, with out the chief’s consent;

•    a fabric discount within the significance of the chief’s job tasks with out his consent;

•    geographical relocation of the chief with out his consent, which is deemed to imply relocation to an workplace greater than twenty (20) miles from his location on the time of a change of management;

•    failure by the Firm to acquire assumption of the Change in Management Settlement by its successor; or


•    any removing of the chief from, or failure to reelect the chief to, any place with the Firm or Financial institution that he held instantly previous to the change of management with out his prior written consent (aside from good trigger, dying, incapacity or retirement).

The Employment Settlement and the Change in Management Settlement present for an extra gross-up cost by Summit to Mr. Maddy within the occasion {that a} cost or distribution pursuant to the Employment Settlement or the Change in Management Settlement can be topic to the excise tax imposed by Part 4999 of the Inner Income Code. Any calculated gross-up cost quantity is the same as a hundred percent (100%) of the excise tax plus a hundred percent (100%) of any federal, state and native revenue taxes plus the extra excise tax on the gross-up quantity.

Employment Agreements – Messrs. Tissue, Frye, and Jennings. On December 20, 2008, the Firm entered into an Amended and Restated Employment Settlement with Scott C. Jennings, on December 24, 2008, the Firm entered into an Amended and Restated Employment Settlement with Robert S. Tissue and on December 31, 2008 the Firm entered into an Amended and Restated Employment Settlement with Patrick N. Frye with a purpose to set forth the phrases and situations of their employment in a way compliant with Inner Income Code Part 409A. The Amended and Restated Employment Agreements with Mr. Jennings, Mr. Frye and Mr. Tissue are considerably an identical in all materials respects and every is known as the “Employment Settlement.”

The Employment Agreements could also be terminated primarily based on one of many following:

•    Termination for Good Trigger (as outlined by the Employment Settlement)

•    Termination Not for Good Trigger (as outlined by the Employment Settlement)

•    Termination for Good Purpose, Wrongful Termination, or at Worker’s Possibility, upon a Change of Management (as outlined by the Employment Settlement).

Messrs. Tissue, Frye, and Jennings are entitled to sure termination funds below the Employment Agreements. If both Mr. Tissue, Mr. Frye or Mr. Jennings is terminated Not for Good Trigger (as outlined by the Employment Settlement), then he’s entitled to a cost from the Firm equal to the bottom wage compensation set forth within the Employment Settlement for the remaining time period of the Employment Settlement or severance pay equal to 100% of his then present annual base wage, whichever is bigger. The termination cost is paid in a lump sum on the date of termination, topic to a six-month delay if required below Inner Income Code Part 409A.

Messrs. Tissue, Frye and Jennings have change of management provisions included of their Employment Agreements. Typically, the Employment Agreements present severance compensation to Messrs. Tissue, Frye and Jennings if such govt’s employment ought to finish below sure specified situations after a change of management. Compensation is paid upon an involuntary termination inside 24 months following a change of management except Messrs. Tissue, Frye or Jennings is terminated for Good Trigger. As well as, compensation might be paid after a change of management if Messrs. Tissue, Frye or Jennings voluntarily terminates employment inside 24 months of a change of management due to:

•    a fabric lower within the whole quantity of the chief’s base wage under the extent in impact on the date of consummation of the change of management, with out his consent;

•    a fabric discount within the govt’s job duties and tasks with out the chief’s prior consent;


•    a fabric geographical relocation of the chief with out his prior consent, which is deemed to imply relocation to an workplace greater than twenty (20) miles from his location on the time of a change of management;

•    failure by the Firm to acquire assumption of the Change in Management Settlement by its successor; or

•    any purported termination of the chief’s employment which isn’t effected pursuant to a discover of termination as required within the govt’s Employment Settlement.

Below the Employment Settlement, a “Change of Management” is outlined in Inner Income Code Part 409A and the laws issued thereunder. This definition is ready forth above below the outline of Mr. Maddy’s Change in Management Settlement.

Messrs. Tissue’s, Frye’s and Jennings’ severance advantages embody:

•    a lump sum money cost equal to the chief’s month-to-month wage (calculated primarily based on the common annual base wage and bonuses for the 2 full 12 months intervals instantly previous the consummation of the Change in Management) multiplied by the variety of months between the date of the chief’s termination and the date that’s twenty-four (24) months after the date of consummation of the Change of Management; offered that the chief’s lump sum money cost not be lower than 100% of his wage; and

•    cost of money incentive award, if any, below the Firm’s Incentive Plans for the 12 months during which the chief terminates for Good Purpose or is involuntarily terminated with out Good Trigger after a Change in Management; and persevering with participation, or if persevering with participation is barred, in considerably comparable applications, in worker profit plans and applications resembling retirement, incapacity and medical insurance coverage for the variety of months between the date of his termination and the date that’s twenty-four (24) months after the date of consummation of the Change of Management, or, if earlier, to the date on which the chief receives comparable advantages from every other supply.

Messrs. Tissue, Frye and Jennings additionally every have the precise to terminate employment with out purpose at his possibility inside six (6) months after a Change of Management, by giving written discover of termination, and severance compensation is then equal to seventy 5 % of wage, to be paid in a lump sum on the date of Separation from Service, topic to a six month delay if required below Inner Income Code Part 409A. Profit continuation within the occasion of termination of employment with out purpose on the govt’s possibility inside six (6) months after a Change of Management is restricted to 6 months (or, if earlier, to the date on which the chief receives comparable advantages from every other supply.)

The change of management provisions in Messrs. Tissue’s, Frye’s and Jennings’ Employment Agreements present for an extra gross-up cost by the Firm to the chief within the occasion {that a} distribution pursuant to the change of management provisions within the Employment Agreements can be topic to the excise tax imposed by Part 4999 of the Inner Income Code. Any calculated gross-up cost quantity is the same as a hundred percent (100%) of the excise tax plus a hundred percent (100%) of any federal, state and native revenue taxes plus the extra excise tax on the gross-up quantity.

The change of management provisions of the Employment Agreements don’t have an effect on the precise of the Firm to terminate Messrs. Tissue, Frye or Jennings or change their wage or advantages with or with out good trigger, previous to any change of management. Nonetheless, any termination or change which takes place after discussions have commenced which lead to a change of management might be presumed to be a wrongful termination and can entitle the executives to the advantages below the Employment Agreements, absent clear and convincing proof on the contrary.


Employment Settlement – Mr. Ritchie. On December 26, 2008, the Firm entered into an Amended and Restated Employment Settlement known as the “Employment Settlement,” with Bradford E. Ritchie, with a purpose to set forth the phrases and situations of his employment in a way compliant with Inner Income Code Part 409A.

The Employment Settlement could also be terminated primarily based on one of many following:

•    Termination for Apart from Good Trigger (as outlined by the Employment Settlement)

•    Termination for Good Trigger (as outlined by the Employment Settlement)

•    Termination for Good Purpose or Wrongful Termination (as outlined by the Employment Settlement).

Mr. Ritchie is entitled to sure termination funds below the Employment Settlement. If Mr. Ritchie is terminated for Apart from Good Trigger (as outlined by the Employment Settlement), then he’s entitled to a severance cost in money from the Firm equal to at least one (1) 12 months of Mr. Ritchie’s Wage payable in a lump sum on the date of termination, topic to a six-month delay if required below Inner Income Code Part 409A.

Mr. Ritchie has change of management provisions included in his Employment Settlement. Typically, the Employment Settlement offers that if Mr. Ritchie’s employment ought to finish below sure specified situations previous to a Change of Management, however after discussions have commenced that lead to a change of management, such termination shall be presumed to be a Wrongful Termination (as outlined by the Employment Settlement). As well as, compensation might be paid upon a change of management if Mr. Ritchie voluntarily terminates employment (for Good Purpose) inside 24 months of a change of management due to:

•    a fabric lower within the whole quantity of Mr. Ritchie’s base wage under the extent in impact on the date of consummation of the change of management, with out his consent;

•    a fabric discount in Mr. Ritchie’s job duties and tasks with out Mr. Ritchie’s prior consent;

•    a fabric geographical relocation of Mr. Ritchie with out his prior consent, which is deemed to imply relocation to an workplace greater than twenty (20) miles from his location on the time of a change of management;

•    failure by the Firm to acquire assumption of the Employment Settlement by its successor; or

•    any purported termination of Mr. Ritchie’s employment which isn’t effected pursuant to a discover of termination as required in Mr. Ritchie’s Employment Settlement.

Below the Employment Settlement, a “Change of Management” is outlined in Inner Income Code Part 409A and the laws issued thereunder. This definition is ready forth above below the outline of Mr. Maddy’s Change in Management Settlement.


Upon a Wrongful Termination or termination for Good Purpose, the Firm can pay Mr. Ritchie:

•    a lump sum money cost equal to his month-to-month wage (calculated primarily based on the common annual base wage for the 2 full 12 months intervals instantly previous the consummation of the Change in Management) multiplied by the variety of months between the date of his termination and the date that’s twenty-four (24) months after the sooner of the date of Separation of Service and the date of consummation of the Change of Management; offered that his lump sum money cost not be lower than 100% of his wage;

•    cost of money incentive awards, if any, below the Firm’s Incentive Plans earned by Worker as of the final day of his employment; and

•    persevering with participation, or if persevering with participation is barred, in considerably comparable applications, in worker profit plans and applications resembling retirement, incapacity and medical insurance coverage for the variety of months between the date of his termination and the date that’s the shorter of twenty-four (24) months after the date of consummation of the Change of Management, or the time frame, if any, throughout which Mr. Ritchie can be entitled to continuation protection below a bunch well being plan.

The change of management provisions of Mr. Ritchie’s Employment Settlement don’t have an effect on the precise of the Firm to terminate Mr. Ritchie or change his wage or advantages with or with out good trigger, previous to any change of management. Nonetheless, any termination or change which takes place after discussions have commenced which lead to a change of management might be presumed to be a wrongful termination and can entitle Mr. Ritchie to the advantages below the Employment Agreements absent clear and convincing proof on the contrary.

Compensation of Named Government Officers

In making use of our compensation rules and philosophy, the Firm analyzed the compensation preparations of its named executives, and believes that the overall compensation paid to its govt officers is acceptable and affordable.

We consider our compensation choices are in the perfect pursuits of our Firm and our shareholders for a lot of causes together with:

•    Now we have a robust administration group with a confirmed document of efficiency.

•    Now we have an skilled group of executives who we consider will present the robust administration crucial to maximise shareholder return.

•    We consider that our incentive compensation plans successfully promote the Firm’s philosophy of pay for efficiency.

We are going to proceed to watch our compensation preparations to make sure that govt pay instantly correlates with the efficiency of the Firm. The Firm is dedicated to the retention of robust administration and can proceed to focus closely on its compensation philosophy and rules because it evaluates the overall compensation of its govt officers.


EXECUTIVE COMPENSATION

Abstract Compensation Desk

The desk under units forth the compensation of the Firm’s Chief Government Officer, the Chief Monetary Officer and the three most extremely compensated govt officers aside from the Chief Government Officer and Chief Monetary Officer who earned $100,000 or extra in wage and bonus for the years ended December 31, 2021, 2020 and 2019 (the “named govt officers”).

Title and Principal Place

Yr

Wage

($)

Bonus ($)

Inventory

Awards
($)

SAR

Awards(1)
($)

Non-Fairness

Incentive

Plan Compen- sation(2)

($)

Non-

certified

Deferred

Compen-

sation

Earnings(3) ($)

All Different

Compen-

sation(4)

($)

Whole

($)

H. Charles Maddy, III President and Chief Government Officer –

Summit Monetary

Group

2021

2020

2019

$530,500

$507,500

$487,500

$289,170

$265,604

$304,425

$279,440

$238,818

$126,010

$117,515

$109,592

$46,600

$42,150

$39,200

$1,296,705

$ 946,605

$1,140,714

Robert S. Tissue
Government Vice President
and Chief Monetary
Officer – Summit

Monetary Group

2021

2020

2019

$297,750

$281,250

$266,250

$160,810

$143,339

$169,290

$153,196

$128,886

$ 32,786

$ 29,226

$ 39,120

$24,900

$24,613

$23,513

$ 685,536

$ 488,285

$ 601,108

Patrick N. Frye

Government Vice President and Chief of Credit score Administration– Summit Monetary Group

2021

2020

2019

$288,001

$272,250

$257,250

$155,730

$ 96,795

$136,620

$123,408

$124,337

$ 38,405

$ 33,577

$ 35,640

$25,920

$24,503

$23,153

$ 644,676

$ 453,738

$ 537,175

Scott C. Jennings
Government Vice President
Chief Working Officer
– Summit Monetary Group

2021

2020

2019

$297,750

$281,250

$266,250

$160,810

$143,339

$169,290

$153,196

$128,886

$ 64,485

$ 60,139

$449,666

$26,100

$25,313

$23,963

$ 718,435

$ 519,898

$1,012,104

Bradford E. Ritchie

President – Summit Group Financial institution

2021

2020

2019

$329,251

$311,250

$285,250

$177,730

$ 94,828

$187,110

$170,217

$121,810

$ 27,417

$ 19,244

$ 32,005

$33,935

$24,725

$35,190

$ 755,443

$ 525,436

$ 569,083

(1)    The quantities on this column symbolize awards of stock-settled inventory appreciation rights in 2019 and 2021 in accordance with the phrases of the 2014 LTI Plan. Inventory-settled inventory appreciation rights granted in 2021 have a base worth equal to $21.85, the honest market worth of the Firm’s widespread inventory on the date of grant, July 15, 2021, and expire ten years from the date of grant. Inventory-settled inventory appreciation rights granted in 2019 have a base worth equal to $23.94, the honest market worth of the Firm’s widespread inventory on the date of grant, February 7, 2019, and expire ten years from the date of grant. The stock-settled inventory appreciation rights granted are time-based, with 20% vesting on every of the primary 5 anniversaries of the grant date, and the rights might be settled in shares of the Firm’s widespread inventory.


(2)    The quantities on this column relate to non-equity incentive funds awarded below the Firm’s Government Officer Administration Incentive Plan in 2022 for efficiency in 2021, awarded below the Firm’s Government Officer Administration Incentive Plan in 2021 for efficiency in 2020, and awarded below the Firm’s Government Officer Administration Incentive Plan in 2020 for efficiency in 2019. The non-equity incentive funds are mentioned within the Compensation Dialogue and Evaluation on pages 31-32.

(3)    The quantities on this column symbolize the rise within the actuarial internet current worth of all future retirement advantages below the Government Wage Continuation Agreements and the Supplemental Government Retirement Plans. The web current worth of the retirement advantages used to calculate the online change in advantages was decided utilizing the identical assumptions used to find out our retirement obligations and expense for monetary assertion functions. Extra details about our Government Wage Continuation Agreements and the Supplemental Government Retirement Plans is included on pages 35-36. The numerous enhance within the internet actuarial internet current worth of future advantages below the Government Wage Continuation Settlement for Mr. Jennings in 2019 displays the truth that Mr. Jennings turned absolutely vested within the remaining 50% of such advantages in 2019. Now we have not offered above-market or preferential earnings on any nonqualified deferred compensation and, accordingly, no such quantities are mirrored above.

(4)    With respect to the compensation on this column for 2021, the quantities embody the Firm’s matching contributions below the Firm’s 401(ok) Outlined Contribution Plan on behalf of Mr. Maddy ($11,600), Mr. Tissue ($10,400), Mr. Frye ($11,520), Mr. Jennings ($11,600) and Mr. Ritchie ($9,273). The quantity additionally contains charges paid to Mr. Maddy ($20,500) in 2021 as a member of the Firm’s and its subsidiary financial institution’s Boards of Administrators. The quantity contains discretionary contributions to the Firm’s ESOP in 2021 as follows: Mr. Maddy ($14,500), Mr. Tissue ($14,500), Mr. Frye ($14,400), Mr. Jennings ($14,500), and Mr. Ritchie ($14,500). No named govt officers acquired perquisites in extra of $10,000 in 2021, aside from Mr. Ritchie who had perquisites totaling $10,162 consisting of the next: worth of the premium paid by the Firm for all times insurance coverage and break up greenback life insurance coverage below the Government Wage Continuation Settlement, firm car, golf membership dues, private bills related to a enterprise journey and sporting occasion tickets.

Whole money compensation, as measured by wage and non-equity incentive plan compensation, relies on the Firm’s efficiency in addition to worker efficiency and sure different elements as described within the part entitled “Government Compensation.” For the named govt officers, whole money compensation as a proportion of whole compensation in 2021 is as follows: Mr. Maddy – 64%; Mr. Tissue – 68%, Mr. Frye – 66%, Mr. Jennings – 65%, and Mr. Ritchie – 68%. The share of whole money compensation to whole compensation for the named govt officers displays the emphasis that’s positioned on money compensation.

An outline of the employment agreements with the named Government Officers is ready forth within the Part entitled “Compensation Dialogue and Evaluation.”


Grants of Plan-Based mostly Awards Throughout 2021

The next desk reveals the grants awarded to the Firm’s named govt officers below the Government Officer Administration Incentive Plan and the Firm’s 2014 Lengthy-Time period Incentive Plan for 2021.

Title Kind of Award Grant Date Potential Payouts Below Non-Fairness Incentive Plan Awards Inventory Settled Inventory Appreciation Rights
Threshold Goal Most Variety of Shares of Inventory or Items Train or Base Worth of Possibility Awards (Per Share)

Grant Date Honest Worth of Inventory and Possibility Awards (3)

(#)  
H. Charles Maddy, III

MIP(1)

2/11/2021 $96,863 $153,750 $304,425

SARS(2)

7/15/2021 30,967 $21.85 $9.34
Robert S. Tissue

MIP(1)

2/11/2021 $53,865 $85,500 $169,290

SARS(2)

7/15/2021 17,221 $21.85 $9.34
Patrick N. Frye

MIP(1)

2/11/2021 $43,470 $69,000 $136,620

SARS(2)

7/15/2021 16,677 $21.85 $9.34
Scott C. Jennings

MIP(1)

2/11/2021 $53,865 $85,500 $169,290

SARS(2)

7/15/2021 17,221 $21.85 $9.34
Bradford E. Ritchie

MIP(1)

2/11/2021 $59,535 $94,500 $187,110

SARS(2)

7/15/2021 19,033 $21.85 $9.34

(1)Quantities symbolize the chance to earn a bonus cost various between 25 to 30 % of the named govt officer’s base wage as of January 1, 2021 multiplied by a multiplier primarily based on the Firm’s annual return on common tangible fairness (“ROATE”) for 2021 pursuant to the Government Officer Administration Incentive Plan for 2021. The brink and focused ranges for the Firm’s ROATE for 2021 have been 10.50 to 11.49 % and 12.50 to 13.49 % respectively. Quantities proven symbolize the brink, goal and most payouts for which every named govt officer was eligible below the Administration Incentive Plan for 2021. Quantities truly earned with respect to those awards are described within the Compensation Dialogue and Evaluation part and included within the Abstract Compensation Desk as Non-Fairness Plan Compensation.

(2)Quantities symbolize awards of stock-settled inventory appreciation rights in accordance with the Firm’s 2014 Lengthy-Time period Incentive Plan (the “2014 LTI Plan”). The stock-settled inventory appreciation rights have a base worth of equal to $21.85, the honest market worth as of the date of grant on July 15, 2021, and expire ten years from the date of grant. The stock-settled inventory appreciation rights granted are time-based, with 20% vesting on every of the primary 5 anniversaries of the grant date. The stock-settled inventory appreciation rights might be settled in shares of the Firm’s widespread inventory.

(3)Quantities replicate the combination grant date honest worth computed in accordance with accounting steerage associated to stock-based compensation. Assumptions used within the calculation of those quantities are included in Observe 16 to the Firm’s audited consolidated monetary statements for the 12 months ended December 31, 2021 included within the Firm’s Annual Report on Type 10-Ok. These quantities replicate the honest worth of those awards on the grant date and don’t correspond to the precise worth that could be paid to or realized by the named govt officers.


Excellent Fairness Awards at December 31, 2021

The next desk reveals excellent fairness awards categorised as exercisable and unexercisable held as of December 31, 2021, by the Firm’s named govt officers.

Inventory Appreciation Rights

(#)

Exercisable

(#)

Unexercisable

Train

Worth

Expiration

Date

H. Charles Maddy, III

20,910.0

12,534.4

12,638.8

3,133.6

18,958.2

30,967.0

$ 12.01

$ 26.01

$ 23.94

$ 21.85

04/23/2025

02/09/2027

02/07/2029

07/15/2031

Robert S. Tissue

10,768.2

6,520.8

6,820.8

1,630.2

10,231.2

17,221.0

$ 12.01

$ 26.01

$ 23.94

$ 21.85

04/23/2025

02/09/2027

02/07/2029

07/15/2031

Patrick N. Frye

3,522.6

4,483.2

4,606.0

1,120.8

6,909.0

16,677.0

$ 12.01

$ 26.01

$ 23.94

$21.85

04/23/2025

02/09/2027

02/07/2029

07/15/2031

Scott C. Jennings

17,947.0

6,520.8

6,820.8

1,630.2

10,231.2

17,221.0

$ 12.01

$ 26.01

$ 23.94

$ 21.85

04/23/2025

02/09/2027

02/07/2029

07/15/2031

Bradford E. Ritchie

17,112.0

4,361.6

4,512.4

1,090.4

6,768.6

19,003.0

$ 12.01

$ 26.01

$ 23.94

$ 21.85

04/23/2025

02/09/2027

02/07/2029

07/15/2031

Grants of stock-settled inventory appreciation rights have been made on April 23, 2015, February 9, 2017, February 7, 2019 and July 15, 2021. At December 31, 2021, a hundred percent of the stock-settled inventory appreciation rights granted in 2015 have been vested, eighty % of the stock-settled inventory appreciation rights granted in 2017 have been vested, forty % of the stock-settled inventory appreciation rights granted in 2019 and not one of the stock-settled inventory appreciation rights granted in 2021were vested. The stock-settled inventory appreciation rights vest 20% on every of the primary 5 anniversaries of the grant date.


Choices Exercised and Inventory Vested Throughout 2021

The next desk offers info on the variety of shares of the Firm’s inventory and the combination greenback worth realized on account of the train of inventory choices throughout 2021.

Possibility Awards Inventory Awards
Variety of Shares Acquired on Train (#)

Worth Realized on Train ($)(1)

Variety of Shares Acquired on Vesting (#)

Worth Realized on Vesting ($)(2)

H. Charles Maddy, III
Robert S. Tissue
Patrick N. Frye
Scott C. Jennings

Bradford E. Ritchie(3)

5,000 $106,070

(1)    Computed by figuring out the market worth per share of the shares acquired primarily based on the distinction between: (a) the per share market worth of our widespread inventory on the date of train and (b) the train worth of the choices.

(2)    No Inventory Appreciation Rights have been exercised in 2021.

(3)    Mr. Ritchie’s worth was computed as described in word (1) above and was primarily based on the next:

Train Date Variety of Choices Exercised Market Worth at Train Train Worth
July 22, 2021 1,000 $22.41 $2.54
September 16, 2021 4,000 $24.09 $2.54

    


    Pension Advantages

The next desk discloses the years of credited service below, the current single-sum worth of the accrued advantages for, funds over the past fiscal 12 months to, and the annual advantages payable upon retirement to the named govt officers below the Government Wage Continuation Agreements (the “Continuation Agreements”) and the Supplemental Government Retirement Plan (“Supplemental Plan”) with the Firm’s named govt officers

Title Plan Title

Variety of
Years
Credited
Service
(#)
(1)

Current
Worth of Amassed Profit
($)
(2)

Funds
Throughout
Final Fiscal Yr
($)

Annual Advantages upon Retirement ($)(3)

H. Charles Maddy, III Continuation Settlement

22

$1,406,000

$ 175,000
Supplemental Plan

$ 47,000

$ 73,000
Robert S. Tissue Continuation Settlement

19

$ 701,000

$ 125,000
Supplemental Plan

$ 8,000

$ 25,000
Patrick N. Frye Continuation Settlement

19

$ 899,000

$ 125,000
Supplemental Plan

$ 14,000

$ 10,000
Scott C. Jennings Continuation Settlement

22

$ 957,000

$ 125,000
Supplemental Plan

$ 29,000

$ 25,000
Bradford E. Ritchie Continuation Settlement

13

$ 304,000

$ 125,000
Supplemental Plan

$ 6,000

$ 50,000

(1)    The years of credited service below the Continuation Agreements start on the efficient date of the person settlement with every named govt officer. Every particular person Continuation Settlement was executed after the date of every named govt officer’s preliminary employment. The executives should not vested in the advantages below the Supplemental Plans till their retirement age below every particular person Supplemental Plan; accordingly, they don’t seem to be granted years of service below such plans.

(2)    The fabric assumptions utilized in quantifying the current worth of the present accrued advantages embody the usage of a 7% low cost fee and an age of dying primarily based on the 2008 Valuation Fundamental Tables.

(3)    The Firm has included an extra column within the above Pension Advantages desk. The quantities listed on this column symbolize the annual quantity payable to the chief upon retirement at his regular retirement age below every plan.

The Continuation Agreements have been supplemented by the Supplemental Plans to incent the executives to work till their retirement age. The Continuation Agreements and the Supplemental Plans are designed to offer an annual outlined retirement profit payable for the lifetime of the chief. These advantages, when added to the retirement advantages that might be offered by the Firm’s 401(ok) Outlined Contribution Plan, Worker Inventory Possession Plan, and social safety, will present every govt with profit ranges akin to different Firm staff when measured as a proportion of wage on the time of retirement.


Estimated Funds Upon Termination

The next tables summarize potential estimated funds and advantages that may be acquired by our Named Government Officers below current Firm contracts, agreements, plans or preparations for numerous eventualities involving termination of employment as a result of: voluntary resignation, termination for good trigger, termination with out good trigger, dying, incapacity, or change of management of the Firm. The under info assumes that the termination occurred on December 31, 2021 and doesn’t embody any funds or advantages that the Named Government Officers would have already got been entitled to or vested in on such date below any Firm contracts, agreements, plans or preparations, together with annual funds below the Government Wage Continuation Agreements and the Supplemental Government Retirement Plans as described on web page 44 below Pension Advantages. Nor does the under info embody advantages different Firm staff would usually obtain within the occasion of comparable circumstances.

Estimated Funds upon Termination Because of:

Voluntary

Termination Termination

Change in

Resignation

for Good Not For Good

Incapacity

Firm

Title

(a)

Trigger (b) Trigger (a)(c)

Loss of life (a)(d)

(a)(e)

Management (a)(f)

H. Charles Maddy, III

$ –

$ –

$1,073,000

$2,591,000

$1,610,000

$3,131,000

Robert S. Tissue

$ –

$ –

$ 336,000

$ 847,000

$ –

$2,119,000

Patrick N. Frye

$ –

$ –

$ 352,000

$ 887,000

$ –

$1,976,000

Scott C. Jennings

$ –

$ –

$ 389,000

$ 501,000

$ –

$1,651,000

Bradford E. Ritchie

$ –

$ –

$ 320,000

$1,038,000

$ –

$1,696,000

(a)    Below the Government Wage Continuation Agreements and the Supplemental Government Retirement Plans, every Named Government Officer is entitled to an annual outlined retirement profit payable for the lifetime of the chief with such funds commencing at regular retirement age. See the abstract of the Government Wage Continuation Agreements and the Supplemental Government Retirement Plans on pages 31-32 of the Compensation Dialogue and Evaluation and the current worth and annual quantity of such advantages listed within the Pension Advantages desk on web page 45. Below the Government Wage Continuation Agreements, upon a voluntary resignation previous to regular retirement age, the chief might be paid his vested proportion of the retirement profit payable on the primary day of the month following his regular retirement age.

(b)    With respect to Mr. Maddy, above illustration of termination for good trigger assumes an act of “gross negligence”. Within the occasion of an act of “easy negligence”, Mr. Maddy would obtain one instances his present annual base wage ($536,500).

(c)    Mr. Maddy would obtain a cost equal to 2 instances his present base wage. Mr. Tissue, Mr. Frye and Mr. Jennings would obtain a cost equal to the larger of 1 12 months’s base wage or the overall base wage for the rest of their respective employment agreements. Mr. Ritchie would obtain a cost equal to at least one 12 months’s base wage. Mr. Tissue, Mr. Frye and Mr. Jennings additionally obtain their Firm vehicle. Circumstances and obligations to the receipt of funds upon termination not for good trigger are described within the Compensation Dialogue and Evaluation, which begins on web page 25.

(d)    Upon dying, every NEO’s designated beneficiary would obtain the NEO’s respective break up greenback life insurance coverage dying profit. As well as, Mr. Maddy’s designated beneficiary would obtain 3 instances his present annual base wage and his household would obtain continuation of their medical insurance protection advantages on the identical phrases as they beforehand acquired for 1 12 months.


(e)    With respect to termination funds made within the occasion of incapacity, Mr. Maddy would obtain thrice his present annual base wage.

(f)    The desk under breaks out the varieties of funds and advantages that every NEO can be entitled to below a change of management, however doesn’t embody any funds or advantages that the NEOs would have already got been entitled to or vested in on such date below any Firm contracts, agreements, plans or preparations upon a change in management. Such funds would include:

Estimated Funds upon Termination in Occasion of a Change in Firm Management

Title

Severance

Worth of

Accelerated

Vesting of

SARS(1)

Current
Worth of Accelerated
Advantages below Wage Continuation Agreements and Supplemental Plans
(2)

Continuation of

Well being

Insurance coverage

Advantages (3)

Worth of

Firm

Car

Estimated
Tax
Gross

Up (4)

Whole

H. Charles Maddy, III (5)

$1,610,000

$244,000

$564,000

$29,000

          –

$684,000

$3,131,000

Robert S. Tissue (6)

$ 877,000

$135,000

$563,000

$19,000

$39,000

$486,000

$2,119,000

Patrick N. Frye (6)

$ 821,000

$119,000

$518,000

$24,000

$64,000

$430,000

$1,976,000

Scott C. Jennings (6)

$ 877,000

$135,000

$193,000

$ 9,000

$91,000

$346,000

$1,651,000

Bradford E. Ritchie (7)

$ 641,000

$132,000

$516,000

$26,000

         –

$381,000

$1,696,000

(1)    Below the 2014 LTI Plan and the person award agreements to the NEOs for the SARs, upon a change of management, if the successor or surviving company so agrees, some or all the excellent stock-settled inventory appreciation rights might be assumed, or changed with the identical sort of award with comparable phrases or situations. Any stock-settled inventory appreciation rights that aren’t absolutely vested on the time a NEO terminates employment as a result of a change of management will change into absolutely vested upon such termination and stay exercisable, all through the unique time period of the award. The quantity disclosed within the above desk is the worth of the unvested SARs calculated by multiplying the variety of unvested awards by the unfold between the closing market worth of the Firm’s inventory on December 31, 2021 and the relevant strike worth. See the abstract of the Inventory Appreciation Rights on web page 33 of the Compensation Dialogue and Evaluation and the abstract of the vested and unvested SARs within the desk of the Excellent Fairness Awards at December 31, 2021 on web page 47.

(2)    The disclosures within the above desk displays the current worth of the unvested advantages held by these NEOs below the Government Wage Continuation Agreements and the Supplemental Government Retirement Plans by calculating the distinction between the current worth of the complete advantages to which every NEO can be entitled and the current worth of the vested portion of the advantages. For functions of the disclosures within the above desk, no funds are included for Mr. Maddy below the Government Wage Continuation Settlement as a result of he’s 100% vested in the advantages below the Government Wage Continuation Settlement. Mr. Tissue, Mr. Frye, Mr. Jennings and Mr. Ritchie are 50% vested in the advantages below the Government Wage Continuation Agreements. The executives should not vested in the advantages below the Supplemental Government Retirement Plans.


(3)    Within the occasion of termination by the chief for Good Purpose or the Firm constituting Wrongful Termination (as such phrases are outlined in Mr. Maddy’s Change in Management Settlement and the Employment Agreements for every of the opposite executives) following an occasion of a change in Firm management, every NEO would obtain continuation of their medical insurance protection advantages on the identical phrases as they beforehand acquired for the next phrases: Mr. Maddy – 3 years; Mr. Tissue – 2 years, Mr. Frye – 2 years; Mr. Jennings – 2 years; and Mr. Ritchie – 2 years.

(4)    The estimated tax gross up relies on the 20% excise tax, grossed up for revenue taxes (at a marginal efficient fee of 43.5%), on the quantity of severance and different advantages above every NEO’s common five-year W-2 earnings multiplied by 2.99.

(5)    There are 5 (5) eventualities below which Mr. Maddy could also be terminated and paid severance below his Change in Management Settlement. The quantity disclosed within the severance column within the above desk represents the quantity of severance below eventualities one, 4 and 5 described under. The 5 eventualities are as follows:

•    Below the primary state of affairs, if Mr. Maddy works for the buying firm for a interval of 1 12 months (the “Transition Interval”), then upon expiration of the Transition Interval, he’s entitled to obtain a cost equal to a few instances the larger of (a) his Wage (as outlined within the Settlement) in impact instantly previous to the date of consummation of the change of management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement.

•    Below the second state of affairs, if Mr. Maddy terminates his employment inside six months of a change of management, then he’s entitled to a lump sum cost equal to seventy-five % (75%) of the larger of (a) his Wage in impact instantly previous to the date of consummation of the change of management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement. The quantity of severance below this state of affairs is $402,000.

•    Below the third state of affairs, if Mr. Maddy terminates his employment after the primary six months following the change of management, however earlier than completion of the Transition Interval, then he’s not entitled to a severance cost below the Change in Management Settlement.

•    Below the fourth state of affairs, if Mr. Maddy terminates for Good Purpose (as outlined within the Compensation Dialogue and Evaluation, which begins on web page 25) or is terminated below circumstances constituting wrongful termination, then he’s entitled to a cost equal to a few instances the larger of (a) his Wage in impact instantly previous to the date of consummation of a change of management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement. Mr. Maddy can be entitled to obtain cost of money incentive award, if any, below the Firm’s Annual Incentive Plan and persevering with participation in worker profit plans and applications resembling retirement, incapacity and medical insurance coverage for the variety of months between the date of his termination and the date that’s thirty-six (36) months after the date of consummation of the change of management.

•    Below the fifth state of affairs, if Mr. Maddy is terminated on account of incapacity or dying through the Transition Interval, Mr. Maddy is entitled to a cost equal to a few instances the larger of (a) his Wage in impact instantly previous to the date of consummation of a change of management or (b) his Wage in impact on the date of termination of his employment below the Change in Management Settlement.

As well as, below the Change of Management Settlement, Mr. Maddy agrees to not interact, instantly or not directly, within the enterprise of banking within the Restricted Space (as outlined within the Change of Management Settlement) for a interval of three years after expiration of the Transition Interval.

(6)    There are two (2) eventualities below which Messrs. Tissue, Frye and Jennings could also be terminated and paid severance below the change of management provisions in every of their Employment Agreements. The 2 eventualities are as follows:

    


•    If Messrs. Tissue, Frye or Jennings are terminated for Good Purpose (as outlined within the Employment Settlement) or are terminated below circumstances constituting Wrongful Termination (as outlined within the Employment Settlement), then the terminated govt officer is entitled to a cost equal to his Wage (as outlined within the Employment Settlement) multiplied by the variety of months between the efficient date of termination and the date that’s twenty 4 (24) months after the date of consummation of change of management, offered in no occasion shall the chief officer obtain a lump sum cost that’s lower than 100% of his Wage. The quantity within the severance column within the above desk represents the severance quantity below this state of affairs.

•    If Messrs. Tissue, Frye or Jennings terminate inside six months of a change of management, the terminated govt officer is entitled to a lump sum cost equal to seventy-five % (75%) of his Wage in impact instantly previous to the date of consummation of the Change of Management (as outlined within the Employment Settlement). The quantity of severance below this state of affairs is $329,000 for Messrs. Tissue and Jennings and $308,000 for Mr. Frye.

(7)    Upon a change of management, below Mr. Ritchie’s Employment Settlement, if Mr. Ritchie is terminated for Good Purpose (as outlined within the Employment Settlement) or is terminated below circumstances constituting Wrongful Termination (as outlined within the Employment Settlement), then Mr. Ritchie is entitled to a cost equal to his Wage (as outlined within the Employment Settlement) multiplied by the variety of months between the efficient date of termination and the date that’s twenty 4 (24) months after the sooner of the date of termination and the date of consummation of change of management, offered in no occasion shall Mr. Ritchie obtain a lump sum cost that’s lower than 100% of his Wage. The quantity within the severance column within the above desk represents the severance quantity below this state of affairs.

    


Director Compensation 2021

The next desk units forth sure info relating to the compensation earned by or awarded to every director who served on the Firm’s Board of Administrators in 2021 aside from H. Charles Maddy, III whose compensation as a named govt officer of the Firm is introduced within the Abstract Compensation Desk on web page 44.

Title

Charges Earned or Paid in Money ($)(1)

Inventory Awards ($) Possibility Awards ($) Non-Fairness Incentive Plan Compensation ($)

Nonqualified Deferred Compensation Earnings(2)

All Different Compensation ($)(3)

Whole ($)
(a) (b) (c) (d) (e) (f)

(g)

(h)
Oscar M. Bean $77,325

$77,325
Dewey F. Bensenhaver $22,200

$22,200
Ronald L. Bowling $22,700 $22,700
J. Scott Bridgeforth $21,700 $21,700
James M. Cookman $23,500 $23,500
John W. Crites, II $23,700 $23,700
James P. Geary, II $24,600 $24,600
Georgette R. George $24,750 $24,750
John B. Gianola $23,800 $23,800
Gary L. Hinkle $26,750 $26,750
Jason A. Kitzmiller $22,700 $22,700
Charles S. Piccirillo $25,550 $25,550
John H. Shott $22,900 $22,900
Ronald B. Spencer $24,400 $24,400

Jill S. Upson(4)

$ 500 $ 500

(1)    Administrators of the Firm acquired $500 per board assembly attended. Non-employee Administrators of the Firm who serve on the Firm’s Audit and Compliance Committee and Compensation and Nominating Committee acquired $750 for every assembly attended. Non-employee Administrators of the Firm who serve on the Firm’s Government Committee acquired $500 for every assembly attended. Non-employee Administrators serving on different Firm Committees acquired $300 per committee assembly attended.

Members of the Board of Administrators of the subsidiary of the Firm are paid an annual retainer price primarily based on the asset measurement of the subsidiary financial institution as of December thirty first of the prior 12 months and obtain $500 for every assembly attended. For 2021, the annual retainer paid to the Members of the Board of Administrators of the subsidiary financial institution was $15,000. Non-employee Administrators of the subsidiary financial institution who serve on the subsidiary financial institution’s Government Committee acquired $500 for every assembly attended. Non-employee Administrators serving on different financial institution subsidiary committees acquired $300 for every committee assembly attended.


The entire members of the Board of Administrators of the Firm are additionally members of the Board of Administrators of the financial institution subsidiary of the Firm, and accordingly, obtain charges from the financial institution subsidiary of the Firm. As well as, Mr. Maddy is a member of the Board of Administrators of the subsidiary financial institution of the Firm and as such receives charges from the financial institution subsidiary. The charges acquired by Mr. Maddy are included within the Abstract Compensation Desk below “All Different Compensation.”

If a person is a member of the Board of Administrators of the Firm or its subsidiary financial institution and can be an worker of the Firm or any of its subsidiaries, then such director might be paid the retainer charges and the charges for every board assembly attended as set forth above; nonetheless, such director won’t be paid the charges for every committee assembly attended.

(2)    Pursuant to the Summit Administrators’ Deferral Plan, the Firm’s Administrators could elect to defer their retainer, assembly and committee charges earned. The Firm invests quantities equating to the deferrals of every collaborating director in phantom investments in numerous mutual funds. Advantages payable to participant administrators at retirement below the Plan will equate to the then present worth of the person investments. The Firm’s subsidiary has an identical deferral plan for its administrators. The Firm has not offered above-market or preferential earnings on any non-qualified deferred compensation and, accordingly, no such quantities are mirrored within the above desk.

(3)    Typically, the Firm offers modest perquisites or private advantages, and solely with respect to advantages or providers which might be designed to help a director in being productive and centered on his or her duties, and which administration and the Committee consider are affordable and in step with the Firm’s total compensation program, together with medical insurance protection below the Firm’s medical insurance plan for sure members of the Firm’s Board of Administrators. This profit is simply obtainable for administrators initially elected to the Board previous to 1994. For these nonetheless receiving medical insurance protection, cost by the Firm for such protection might be discontinued upon their retirement. No administrators acquired perquisites in extra of $10,000.

(4)    Ms. Upson joined the Board of Administrators on November 18, 2021 and attended one Board assembly in 2021.


Pay Ratio

    As required by relevant SEC guidelines, we’re offering the next details about the connection of the annual whole compensation of our median worker and the annual whole compensation of H. Charles Maddy, III, our President and Chief Government Officer (our “CEO”).

    For 2021, our final accomplished fiscal 12 months:

the annual whole compensation of our median worker was $44,000; and

the annual whole compensation of our CEO, as reported within the Abstract Compensation Desk included elsewhere on this proxy assertion, was $1,297,000.

    Based mostly on this info, for 2021 the ratio of the annual whole compensation of H. Charles Maddy, III, our President and Chief Government Officer, to the annual whole compensation of our median worker was 29 to 1.

    We took the next steps to determine the median worker and to find out the annual whole compensation of our median worker.

We decided that, as of December 31, 2020, our worker inhabitants consisted of roughly 435 people (excluding our CEO). This inhabitants consisted of our full-time, part-time, and momentary staff employed with us as of the willpower date.

To determine the median worker from our worker inhabitants, we used the quantity of federal taxable wages for the recognized staff as mirrored in our payroll data for the twelve-month interval starting January 1, 2020 and ending December 31, 2020. For wages, we usually used the overall quantity of compensation the workers have been paid earlier than any taxes, deductions, insurance coverage premiums, and different payroll withholding. We didn’t use any statistical sampling methods.

For the annual whole compensation of our median worker, we recognized and calculated the weather of that worker’s compensation for 2021 in accordance with the necessities of Merchandise 402(c)(2)(x), leading to annual whole compensation of $44,000 which incorporates wage, non-equity incentive funds, the Firm’s matching contribution below the Firm’s 401(ok) Outlined Contribution Plan, discretionary contributions to the Firm’s ESOP and the greenback worth of the life insurance coverage premiums paid by the Firm for the median worker.

For the annual whole compensation of our CEO, we used the quantity reported within the “Whole” column of our 2021 Abstract Compensation Desk included on this proxy assertion.

        The CEO pay ratio reported above is an inexpensive estimate calculated in a way in step with SEC guidelines primarily based on the methodologies and assumptions described above. SEC guidelines for figuring out the median worker and figuring out the CEO pay ratio allow firms to make use of a variety of methodologies, estimates and assumptions. In consequence, the CEO pay ratios reported by different firms, which can have employed different permitted methodologies or assumptions and which can have a considerably completely different work drive construction from ours, are probably not akin to our CEO pay ratio.


COMPENSATION AND NOMINATING COMMITTEE REPORT

The Compensation and Nominating Committee has reviewed and mentioned the Compensation Dialogue and Evaluation required by Merchandise 402(b) of Regulation S-Ok with administration, and primarily based on such assessment and discussions, the Compensation and Nominating Committee recommends to the Board of Administrators that the Compensation Dialogue and Evaluation be included on this Proxy Assertion.

Compensation and Nominating Committee

Oscar M. Bean

Dewey F. Bensenhaver

James P. Geary, II

John B. Gianola

Gary L. Hinkle

Charles S. Piccirillo

ITEM 3 – RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Administrators has appointed Yount, Hyde & Barbour, P.C. to function our unbiased registered public accounting agency for 2022 topic to the ratification of our shareholders. For info regarding the audit charges paid by the Firm in 2021 and 2020 to Yount, Hyde & Barbour, P.C. and for details about the Firm’s auditors usually, see the Audit and Compliance Committee Report on web page 58 of this Proxy Assertion.

Representatives of Yount, Hyde & Barbour, P.C. might be current on the Annual Assembly to reply questions. They may even have the chance to make a press release in the event that they want to take action.

The affirmative vote of a majority of votes forged on this proposal is required for the ratification of this proposal. In figuring out whether or not the proposal has acquired the requisite variety of affirmative votes, abstentions and dealer non-votes might be disregarded and can have no impact on the result of the vote.

Shareholder ratification of the choice of Yount, Hyde & Barbour, P.C. as our unbiased registered public accounting agency is just not required by our Bylaws or in any other case. Nonetheless, the Board of Administrators is submitting the choice of Yount, Hyde & Barbour, P.C. to the shareholders for ratification as a matter of excellent company apply. If the shareholders fail to ratify the choice, the Audit and Compliance Committee and the Board of Administrators will rethink whether or not or to not retain that agency. Even when the choice is ratified, the Audit and Compliance Committee and the Board of Administrators of their discretion could direct the appointment of various unbiased auditors at any time through the 12 months in the event that they decide that such a change can be in the perfect curiosity of the Firm and our shareholders.

The Board of Administrators recommends a vote FOR the ratification of Yount, Hyde & Barbour, P.C. as our unbiased registered public accounting agency for the 12 months 2022.


AUDIT AND COMPLIANCE COMMITTEE REPORT

The Audit and Compliance Committee of the Board of Administrators of the Firm consists of seven (7) unbiased administrators. The members of the Audit and Compliance Committee are Chairman, John B. Gianola, John W. Crites, II, Georgette R. George, Gary L. Hinkle, Jason A. Kitzmiller, Charles S. Piccirillo and Ronald B. Spencer.

The Audit and Compliance Committee operates below a written constitution adopted by the Firm’s Board of Administrators. A duplicate of the Audit and Compliance Committee Constitution is offered on the Firm’s web site at www.summitfgi.com.

On November 14, 2016, the Board of Administrators of the Firm engaged Yount, Hyde & Barbour, P.C. as its successor unbiased registered public accounting agency to audit the Firm’s monetary statements. Since January 1, 2014, the Firm has not consulted Yount, Hyde & Barbour, P.C. relating to (i) the applying of accounting rules to a specified transaction, (ii) the kind of audit opinion that may be rendered on the Firm’s monetary statements, or (iii) any matter that was the topic of a disagreement or occasion recognized in response to Merchandise 304(a)(1) of Regulation S-Ok (there being none). On the 2021 Annual Assembly of shareholders, the shareholders of the Firm ratified Yount, Hyde & Barbour, P.C. because the Firm’s unbiased registered public accounting agency for the 12 months ended December 31, 2021.

The Audit and Compliance Committee has reviewed the audited monetary statements of the Firm for the fiscal 12 months ended December 31, 2021, and mentioned them with Administration and the Firm’s unbiased auditors, Yount, Hyde & Barbour, P.C. The Audit and Compliance Committee additionally has mentioned with the unbiased auditors the issues required to be mentioned by the relevant necessities of the Public Firm Accounting Oversight Board (the “PCAOB”) and the Securities and Alternate Fee.

The Audit and Compliance Committee has acquired from the unbiased auditors the written disclosures and letter required by the Public Firm Accounting Oversight Board Ethics and Independence Rule 3526, “Communication with Audit Committee Regarding Independence”, and the Audit and Compliance Committee has mentioned with the auditors their independence from the Firm and Administration.

Based mostly on the assessment and discussions described above, the Audit and Compliance Committee really helpful to the Board of Administrators that the Firm’s audited monetary statements for the 12 months ended December 31, 2021, be included within the Firm’s Annual Report on Type 10-Ok for 2021.

Audit and Compliance Committee

John B. Gianola, Chairman

John W. Crites, II

Georgette R. George

Gary L. Hinkle

Jason A. Kitzmiller

Charles S. Piccirillo

Ronald B. Spencer


Charges To Unbiased Registered Public Accounting Agency

The next desk presents charges for skilled providers rendered by Yount, Hyde & Barbour, P.C. to carry out an audit of the Firm’s annual monetary statements for the years ended December 31, 2021 and December 31, 2020.

2021 2020

Audit Charges(1)

$263,000 $308,500

Audit-Associated Charges(2)

$ 1,500 $ 3,500

Tax Charges(3)

$ 16,000 $ 13,500

All Different Charges(4)

Whole Charges $280,500 $325,500

(1)    Audit Charges — These are charges for skilled providers carried out by Yount, Hyde & Barbour, P.C. related to the annual audit of the Firm’s consolidated monetary statements, the audit of the effectiveness of the Firm’s inner management over monetary reporting, assessment of the Firm’s quarterly reviews on Type 10-Q filed with the Securities and Alternate Fee, and preparation of consents.

(2)    Audit-Associated Charges —Audit-related charges throughout 2021 and 2020 have been for due diligence responses along with the Firm’s subordinated debt personal placement transactions.

(3)    Tax Charges — These are charges for skilled providers offered by Yount, Hyde & Barbour, P.C. for tax compliance providers in 2021 and 2020.

(4)    All Different Charges — Yount, Hyde & Barbour, P.C. didn’t present the Firm different providers not described within the above objects.

All providers rendered by Yount, Hyde & Barbour, P.C. are permissible below relevant legal guidelines and laws, and pre-approved by the Audit and Compliance Committee. The Audit and Compliance Committee’s pre-approval insurance policies for audit and non-audit providers offered to the Firm by Yount, Hyde & Barbour, P.C. are as follows:

•    Any proposed providers that may lead to charges exceeding 5% of the overall audit charges require particular pre-approval by the Audit and Compliance Committee.

•    Any proposed providers that may lead to charges of lower than 5% of the overall audit charges could also be commenced previous to acquiring pre-approval of the Audit and Compliance Committee. Nonetheless, earlier than any substantial work is accomplished, Yount, Hyde & Barbour, P.C. should acquire the approval of such providers from the Chairman of the Audit and Compliance Committee.

The spending degree and work content material of those providers are actively monitored by the Audit and Compliance Committee to take care of the suitable objectivity and independence in auditor’s core work, that are the audits of the Firm’s consolidated monetary statements and the effectiveness of the Firm’s inner management over monetary reporting.

The Audit and Compliance Committee has thought of and decided that the supply of those further providers is appropriate with sustaining Yount, Hyde & Barbour, P.C. For extra info regarding the Firm’s Audit and Compliance Committee, see pages 15-16 of those Annual Assembly supplies.


REQUIREMENTS, INCLUDING DEADLINE FOR SUBMISSION
OF SHAREHOLDER PROPOSALS, NOMINATION OF DIRECTORS AND
OTHER BUSINESS OF SHAREHOLDERS

Shareholder Proposals for the 2023 Annual Assembly

Shareholder Proposals for Inclusion within the Proxy Assertion. Below the principles of the SEC, shareholder proposals meant to be introduced on the Firm’s 2023 Annual Assembly of Shareholders have to be acquired by us, Consideration: Secretary, at our principal govt places of work by December 10, 2022, for inclusion within the proxy assertion and type of proxy regarding that assembly. If the 2023 Annual Assembly date is scheduled to be held greater than thirty (30) days earlier than or after Might 19, 2023, shareholders might be knowledgeable of the brand new assembly date and the revised date by which shareholder proposals have to be acquired. We strongly encourage any shareholder all in favour of submitting a proposal to seek the advice of educated counsel with regard to the detailed necessities of relevant securities legal guidelines.

Shareholder Proposals for Presentation on the 2023 Annual Assembly. Shareholder proposals to be introduced earlier than our 2023 Annual Assembly and submitted outdoors the processes of Rule 14a-8 have to be acquired by us, Consideration: Secretary, at our principal govt places of work by February 23, 2023. If discover is just not offered by February 23, 2023, the proposal might be thought of premature and, if introduced on the 2023 Annual Assembly, the individuals named within the Firm’s proxy for the 2023 Annual Assembly of Shareholders might be allowed to train their discretionary authority to vote upon any such proposal with out the matter having been addressed within the proxy assertion for the 2023 Annual Assembly of Shareholders.

Nomination of Administrators

Below our Articles of Incorporation, sure procedures are offered which a shareholder should observe to appoint individuals for election as Administrators. These procedures present that nominations for Administrators at an annual assembly of shareholders have to be submitted in writing to the President of the Firm at P. O. Field 179, 300 North Fundamental Road, Moorefield, West Virginia 26836. The nomination have to be acquired no later than:

•    thirty (30) days prematurely of an annual assembly if a minimum of thirty (30) days prior discover is offered; or

•    5 (5) days following the day on which the discover of assembly is mailed if lower than thirty (30) days’ discover is given.

The nomination should comprise the next details about the nominee and notifying shareholder:

•    title of the nominee;

•    handle of the nominee;

•    principal occupation of the nominee;


•    the variety of shares of widespread inventory held by the notifying shareholder; and the title and handle of the notifying shareholder.

The chairman of the assembly could refuse to acknowledge the nomination of any individual, if not in compliance with the foregoing procedures.

The Board is just not conscious of any issues which might be anticipated to return earlier than the Annual Assembly aside from these referred to on this Proxy Assertion. If every other matter ought to come earlier than the Annual Assembly, the individuals named within the accompanying proxy intend to train their discretionary authority in accordance with relevant federal and state legal guidelines and laws to vote the proxies in accordance with their greatest judgment.

Inventory Transfers

Present market quotations for the widespread inventory of Summit Monetary Group, Inc. can be found on the NASDAQ Capital Market below the image “SMMF.”

ANNUAL REPORT

The annual report of the Firm for the 12 months ended December 31, 2021, is being mailed concurrently with this Proxy Assertion.

The monetary statements and different info to be delivered with this Proxy Assertion represent the annual disclosure assertion as required by 12 C.F.R. 18.

FORM 10-Ok

The Firm will furnish with out cost to every individual whose proxy is being solicited, upon the request of any such individual, a replica of the Firm’s annual report on Type 10-Ok for 2021. Requests for copies of such report ought to be directed to Julie R. Markwood, Senior Vice President, Chief Accounting Officer, Summit Monetary Group, Inc., P. O. Field 179, Moorefield, West Virginia 26836, or e-mail [email protected]

Whether or not or not you intend to attend the Assembly, please mark, signal, date, and promptly return the enclosed proxy within the enclosed envelope. No postage is required for mailing in the USA.

By Order of the Board of Administrators,

April 11, 2022


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