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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

(AMENDMENT NO.    )

Filed by the Registrant   ☒                            Filed by a Party other than the Registrant  ☐

Check the appropriate box:

Bank of Commerce Holdings

555 Capitol Mall, Suite 1255

Sacramento, California 95814

(800) 421-2575

20182019 Annual Meeting of Shareholders

April 5, 20184, 2019

Dear Shareholder:

It is my pleasure to invite you to the 20182019 Annual Meeting of Shareholders (the “Annual Meeting”) of Bank of Commerce Holdings (the “Company”).

The Annual Meeting will be held on Tuesday, May 22, 201821, 2019 at 10:11:00 a.m. Pacific Time at the Bank of Commerce Holdings’Company’s corporate headquarters building located at 555 Capitol Mall, Sacramento, California 95814 in the Third Floor Boardroom. In addition to the formal items of business, I will report on the Company’s 20172018 performance and provide some comments on its future.

At the Annual Meeting, you will be asked to elect the slate of directors,directors; to ratify the selection of the Company’s independent registered public accounting firm for 2018 and2019; to vote in an advisory (non-binding) capacityapprove, on a resolution approvingnon-binding advisory basis, the compensation of the Company’s named executive officers.officers; to vote, on a non-binding advisory basis, on the frequency of future advisory votes on the compensation of the Company’s named executive officers; and to approve the Company’s 2019 Equity Incentive Plan. This mailing includes the formal notice of the Annual Meeting and the Proxy Statement. The Proxy Statement describes in greater detail the business that will be conducted at the Annual Meeting. Financial results and information about the Company and its subsidiaries can be found in the Annual Report to Shareholders (which includes the Company’s Form 10-K for the fiscal year ended December 31, 2017)2018), which accompanies this Proxy Statement.

Please vote promptly by telephone, internet or mail regardless of whether or not you plan to attend the meeting. Your vote is important.

I look forward to seeing you at the meeting.

Sincerely,

/s/ Randall S. Eslick

Randall S. Eslick

President and Chief Executive Officer

The accompanying Proxy Statement and proxy card are first being mailed to shareholders on or about April 5, 2018.4, 2019.

Bank of Commerce Holdings

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

The 20182019 Annual Meeting of Shareholders (the “Annual Meeting”) of Bank of Commerce Holdings (the “Company”) will be held at the date, time and place noted above. At the Annual Meeting, you will be asked to:

●

Approve, on a non-binding advisory basis, the compensation of the Company’s named executive officers (the “say-on-pay” vote);

●

Vote, in an advisory (non-binding) capacity on a resolution approving compensationnon-binding advisory basis, on the frequency (i.e., every one, two, or three years) of holding the Company’s named executive officers;say-on-pay vote;

●

Approve the 2019 Equity Incentive Plan; and

If you were a shareholder of record as of the close of business on Monday,Tuesday, March 26, 2018,2019, you are entitled to notice of and to vote at the Annual Meeting and any adjournment thereof. The accompanying Proxy Statement and proxy card are first being mailed to shareholders on or about Thursday, April 5, 2018.4, 2019.

Whether or not you plan to attend the Annual Meeting, please vote promptly by telephone or over the internet. Instructions regarding telephone and internet voting are included on the proxy card. Alternatively, you may complete and mail the enclosed proxy card (please allow a minimum of ten business days for your proxy card to be processed). If you choose to vote by mail, please mark, sign and date the proxy card and return it in the enclosed envelope. Your proxy may be revoked at any time before it is exercised, as explained in the Proxy Statement. Returning your proxy card will not limit your rights to attend or vote at the Annual Meeting.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be held on May 22, 2018:21, 2019: The Bank of Commerce Holdings Proxy Statement for the 20182019 Annual Meeting of Shareholders being held on Tuesday, May 22, 201821, 2019 and the Annual Report to Shareholders (which includesthe Company’s Form 10-K for the fiscal year ended December 31, 2017)2018) are available on the internet atwww.bankofcommerceholdings.comand www.proxyvote.com.

By Order of the Board of Directors,

/s/ Andrea M. SchneckNewburn

Andrea M. SchneckNewburn

Corporate Secretary

Sacramento, California

April 5, 20184, 2019

Table of Contents

Bank of Commerce Holdings

PROXY STATEMENT

INFORMATION ABOUT THE 20182019 ANNUAL MEETING OF SHAREHOLDERS AND VOTING

Why did you send me this Proxy Statement?

The Board of Directors (the “Board”) of Bank of Commerce Holdings (the “Company”) is soliciting proxies from its shareholders to be used for voting at the Annual Meeting of Shareholders on Tuesday, May 22, 201821, 2019 (the “Annual Meeting”). This Proxy Statement summarizes the information you need to know to cast an informed vote at the Annual Meeting. You do not need to attend the Annual Meeting to vote your shares. Instead, you may simply use the convenientvote by telephone or internet voting method as described on the proxy card, or you may complete, sign and return the enclosed proxy card (please allow a minimum of ten business days for your proxy card to be processed).

Along with this Proxy Statement, you are being sentwill receive the 20172018 Annual Report to Shareholders (“Annual Report”), which includes the Company’s Form 10-K for the fiscal year ended December 31, 20172018 (“Form 10-K”).

Who is entitled to vote?

Shareholders of record at the close of business on Monday,Tuesday, March 26, 20182019 (the “Record Date”) are entitled to notice of and to vote at the Annual Meeting. As of the close of business on the Record Date, the Company had 16,241,22618,126,699 shares of common stock (“Common Stock”) outstanding and entitled to vote.

There are two types of ownership of the Company’s Common Stock: (i) registered and (ii) beneficial ownership through third-party nominees. A significant percentage of the Company’s shareholders hold their shares through a stockbroker, bank or other nominee rather than directly in their own names. As summarized below, there are some differences between the two types of ownership.

Registered Owners

Registered owners hold their shares in their own names with the Company’s transfer agent, Broadridge Financial Solutions, Inc. (“Broadridge”), and such registered owners are considered, with respect to those shares, the shareholder of record. These proxy materials are being sent to such shareholders directly. As the shareholder of record, a registered holder has the right to vote his, her, or its shares directly (via telephone or internet voting, by granting a voting proxy directly to the Company, or by voting in person at the Annual Meeting).

Beneficial Owners

Beneficial owners hold their shares through a stock brokerage account, a bank or another nominee (“Nominee”(referred to herein collectively as “Broker”). Shares beneficially owned are sometimes referred to as being held in “street name.” In that case, these proxy materials are being provided to you indirectly through your Nominee.Broker. As the beneficial owner, you have the right to direct your NomineeBroker on how to vote your shares. Your NomineeBroker has enclosed a voting instruction card for you to use in providing such direction.

Brokers cannot vote street name shares on “non-routine” proposals unless directed to do so by the shareholder. Shares that are not voted due to this limitation are known as “broker non-votes.” Generally, broker non-votes occur when street name shares are not voted with respect to a particular proposal because (i) the brokerBroker has not received voting instructions and (ii) the brokerBroker lacks discretionary authority to vote such shares.

If your shares are held in street name and you do not submit voting instructions to your broker,Broker, your brokerBroker may vote your shares at this meeting on the ratification of the selection of the independent registered public accounting firm only. If noyou do not give instructions are given with respect to the election of directors ordirector nominees, the non-binding advisory say-on-pay resolution to approve the compensation of the Company’s named executive officers, named in the “EXECUTIVE COMPENSATION – COMPENSATION DISCUSSION AND ANALYSIS” sectionnon-binding advisory resolution to approve the frequency of this Proxy Statement (the “named executive officers”),holding the say-on-pay vote, or the approval of the 2019 Equity Incentive Plan, your brokerBroker cannot vote your shares on these proposals.

What constitutes a quorum?

The presence in person or by proxy of the holders of a majority of the Company’s outstanding shares of Common Stock outstanding and entitled to vote constitutes a quorum for the transaction of business at the Annual Meeting. Abstentions and broker non-votes are each included in the determination of the number of shares present and voting for purposes of determining the presence of a quorum.

How many votes do I have?

Each shareholder will be entitled to one vote, in person or by proxy, for each share of Common Stock held by him, her, or it on the Record Date. However, under the Company’s bylaws and California law, if any shareholder gives notice at the Annual Meeting, prior to the voting, of an intention to cumulate the shareholder’s votes in the election of directors, then all shareholders entitled to vote at the Annual Meeting may cumulate their votes in the election of directors. Cumulative voting means that a shareholder has the right to give any one candidate who has been properly placed in nomination a number of votes equal to the number of directors to be elected multiplied by the number of shares the shareholder is entitled to vote, or to distribute such votes on the same principle among as many properly nominated candidates (up to the number of persons to be elected) as the shareholder may wish. If cumulative voting applies at the Annual Meeting, the cumulative number of votes a shareholder may cast in the election of directors will be equal to the number of shares held by such shareholder on the Record Date multiplied by nineten (the number of directors to be elected at the Annual Meeting). The proxy card indicates the number of votes that you have.

How do I vote?

Please vote promptly by telephone or over the internet. Alternatively, you may complete and mail the enclosed proxy card (please allow a minimum of ten business days for your proxy card to be processed). Even if you plan to attend the Annual Meeting, it is recommended that you vote your shares in advance as described below so that your vote will be counted if you later decide not to attend the Annual Meeting.

The method you use to vote will not limit your right to vote at the Annual Meeting if you decide to attend in person. Written ballots will be distributed to any registered shareholder who wants to vote at the Annual Meeting. If you hold your shares through a Nominee,Broker, you must obtain a “Legal Proxy,” executed in your favor, from the Nomineeyour Broker to be able to vote by ballot at the Annual Meeting.

By Telephone or Internet.Internet: You may cast your vote by telephone or internet as indicated on the proxy card. Telephone and internet voting are available twenty-four hours per day. Have your proxy card in hand. You will be prompted to vote using the control number provided on your proxy card. If you vote by telephone or internet, please do not return the proxy card.

By Mail.Mail: You may cast your vote by mail by completing, signing and dating the enclosed proxy card and returning it in the enclosed envelope. Please allow a minimum of ten business days for your proxy card to be processed.

Shares represented by properly executed proxies that are received prior to the deadline for submitting proxies and that are not revoked in a manner described below will be voted in accordance with the instructions indicated on the proxies. If no instructions are indicated, the persons named in the proxy will vote the shares represented by the proxy FOR ALL the director nominees listed in this Proxy Statement, FOR the ratification of the selection of the independent registered public accounting firm, and FOR the non-binding advisory (non-binding) say-on-pay resolution to approve the compensation of the Company’s named executive officers.officers, 1 YEAR on the non-binding advisory resolution on the frequency of holding future say-on-pay votes, and FOR the 2019 Equity Incentive Plan.

In Person at the Annual Meeting:

How do I change my vote or revoke my proxy?

Shareholders of record at the close of business on the Record Date will be entitled to vote at the Annual Meeting and may change their votes as described below.

If you voted by telephone or internet.internet: If you voted by telephone or internet, you may change your vote until the telephone or internet polls close. The final vote is the one that will count.

Registered Owners owners who voted by mail.: If you completed and submitted the proxy card, you may change your vote at any time before the vote is conducted at the Annual Meeting by:

Beneficial Owners owners who voted by mail.: Contact your broker or other NomineeBroker for instructions to determine when and how changes to your vote may be submitted.

Any proxy given by a shareholder may be revoked before its exercise by:

What will happen if I do not vote my shares?

If your shares are registered in your name and you do not vote by telephone or internet, if you do not return your signed proxy card, or if you do not vote in person at the Annual Meeting, your shares will not be voted at the Annual Meeting.

If your shares are held in street name and you do not submit voting instructions to your broker,Broker, your brokerBroker may vote your shares at this meeting on the ratification of the selection of the independent registered public accounting firm only. If you do not give instructions with respect to the election of directors ordirector nominees, the non-binding advisory (non-binding)say-on-pay resolution to approve the compensation of the Company’s named executive officers, the non-binding advisory resolution to approve the frequency of holding the say-on-pay vote, or the approval of the 2019 Equity Incentive Plan, your brokerBroker cannot vote your shares on these proposals.

It is very important that you vote on the proposals presented. Your brokerBroker can only vote on Proposal 2 without instructions from you.

What vote is required to approve each proposal?

Proposal 1: Election of Directors.

The nineten nominees for director who receive the most affirmative votes will be elected. If you vote “For All” nominees, your vote will count for each nominee. If you do not vote “For All” nominees and you indicate “Withhold All” or “For All Except” a particular nominee on your proxy card, your vote will not count “For” or “Against” the nominee(s).

Proposal 2: Ratify the selection of Moss Adams LLP as the Company’s independent registered public accounting firm for 2018.2019.

If the shareholders do not approve the selection of Moss Adams LLP by a majority of the shares voting on the proposal, the selection will be reconsidered.

Proposal 3: Approve, on a non-binding advisory basis, the compensation of the Company’s named executive officers.

The matter will be decided by the affirmative vote of a majority of votes castthe shares represented and voting at the Annual Meeting on this proposalat which a quorum is required to ratifypresent. As the selection of the Company’s independent registered public accounting firm. Abstentionsvote is non-binding, abstentions and broker non-votes will have no effect on the outcome of the proposal.

Proposal 3: Vote in an advisory (non-binding) capacity on a resolution approving compensation of the Company’s named executive officers.

In 2013, on an advisory basis, the Company’s shareholders voted to take advisory votes on executive compensation on an annual basis. The Company has followed the guidance of its shareholders and annually requests the approval on an advisory (non-binding) basis of the compensation of its named executive officers as disclosed in the Company’s annual Proxy Statement. Detailed information about the compensation of the named executive officers is included in the section entitled “EXECUTIVE COMPENSATION – COMPENSATION DISCUSSION AND ANALYSIS.”

The Company’s executive compensation programs are designed (i) to attract and retain well-qualified executive officers, (ii) to link executive officer compensation to the Company’s financial performance, and (iii) to reward executive officers for creating shareholder value. The Company believes its executive compensation programs achieve these objectives.

The affirmative vote of a majority of votes cast at the Annual Meeting on this proposal is required to approve the advisory (non-binding) resolution on the compensation of the Company’s named executive officers.vote. The Board and Executive Compensation Committee value the opinions of the shareholders and will consider the outcome of the vote when making future compensation decisions regarding named executive officers. Abstentions

Proposal 4: Vote, on a non-binding advisory basis, on the frequency of future say-on-pay votes.

You will have the opportunity to specify whether you prefer the vote to occur every year, every two years, or every three years, or you may abstain from voting on this proposal. As the vote is non-binding, abstentions and broker non-votes will have no effect on the outcome of the vote.

Proposal 5: Approve the 2019 Equity Incentive Plan.

Approval of the proposal requires the affirmative vote of a majority of the shares represented and voting at the Annual Meeting at which a quorum is present (which shares voting affirmatively also constitute at least a majority of the required quorum). Abstentions and broker non-votes may have an effect on the outcome of the proposal.

What are the Board’s recommendations?

Unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote as recommended by the Board. The Board recommends a vote:

If any other matter is presented at the Annual Meeting, your proxy holder will vote in accordance with the recommendation of the Board or, if no recommendation is given, in accordance with his or her best judgment. At the time this Proxy Statement went to press, the Company knew of no matters to be acted upon at the Annual Meeting other than those discussed in this Proxy Statement.

Who pays the costs of soliciting proxies?

The expense of printing and mailing proxy materials, including this Proxy Statement, the proxy card, and the Annual Report (which includes the Company’s Form 10-K for the fiscal year ended December 31, 2017)10-K), will be borne by the Company. In addition to the solicitation of proxies by mail, certain directors, officers and other employees of the Company may solicit proxies in person, by telephone, or by email. No additional compensation will be paid to such persons for such solicitations. The Company will reimburse brokerage firms and others for their reasonable expenses in forwarding solicitation materials to beneficial owners of the Company’s Common Stock. The Company has contracted with Broadridge to assist in the distribution of materials and tabulation of votes.

How do I obtain a Form 10-K and/or an Annual Report?

The Company’s audited consolidated balance sheets for the years ended December 31, 20172018 and 20162017 and audited consolidated statements of income, shareholders’ equity and cash flows for the years ended December 31, 2018, 2017 2016 and 20152016 are part of the Company’s Form 10-K which accompanies this Proxy Statement.

Additional copies of the Company’s Form 10-K and Annual Report may be obtained for no cost upon written request to Bank of Commerce Holdings, Attention: Corporate Secretary, 1901 Churn Creek Road, Redding, California 96002 and are also available on the Company’s website at www.bankofcommerceholdings.com.

The Securities and Exchange Commission (the “SEC”(“SEC”) maintains a website at http://www.sec.gov that includes the Company’s SEC filings. Access to the Company’s Form 10-K, quarterly reports on Form 10-Q, Current Reportscurrent reports on Form 8-K, and beneficial ownership reports by Company insiders are available free of charge as soon as they are filed with the SEC.

Do the Company’s directors, nominees and named executive officers have personal interests in the matters to be voted on at the Annual Meeting?

No directors, nominees, or named executive officers of the Company have a personal interest in the matters to be voted on at the Annual Meeting other than, for directors, their desire to continue serving as directors. The vote on approval of named executive officer compensation is non-binding, and a vote denying approval would not directly affect named executive officer compensation but would be considered in future compensation decisions by the Board and the Executive Compensation Committee.

VOTING SECURITIES AND OWNERSHIP OF CERTAIN BENEFICIAL HOLDERS

Shareholders of record at the close of business on Monday,Tuesday, March 26, 2018,2019, which is the Record Date, are entitled to notice of and to vote at the Annual Meeting. As of the close of business on the Record Date, the Company had 16,241,22618,126,699 shares of its Common Stock outstanding and entitled to vote.

The following table shows, as of March 1, 2018,2019, the number of shares of Common Stock directly owned (unless otherwise indicated) by:

The Company has determined beneficial ownership in accordance with the rules of the SEC. In general, beneficial ownership includes (i) securities over which a director or executive officer is deemed to have voting or investment power, either directly or indirectly, and (ii) stock options or other rights that are exercisable currently or become exercisable within sixty days following March 1, 2018.2019. Except as otherwise noted, the Company believes that the beneficial owners of the shares listed below, based on information furnished by such owners, have voting and investment power with respect to the shares.

Five Percent Shareholders

¹ AccordingA Schedule 13G filed with the SEC on February 8, 2019 for the period ending December 31, 2018 indicates that BlackRock, Inc. (“BlackRock”) had sole voting power over 917,663 shares and sole dispositive power over 961,059 shares of the Company’s Common Stock. The securities are beneficially owned by various investors for which BlackRock serves as investment advisor. For purposes of the Exchange Act, BlackRock is deemed to thebe a beneficial owner of such securities.

² A Schedule 13G/A filed with the SEC on February 13, 2019 for the period ending December 31, 2018 which was filed and reported jointly by Banc Fund VII L.P., Banc Fund VIII L.P., and Banc Fund IX L.P., and the ultimate general partner of each fund, The Banc Funds Company, L.L.C.

² According to the Schedule 13G filed on June 30, 2017, which was filed and reported jointly byindicates that EJF Capital LLC and Emanuel J. Friedman had shared voting and dispositive power over 885,153 shares of the Company’s Common Stock and that EJF Sidecar Fund, Series LLC – Series E.

³ According toE had shared voting and dispositive power over 881,952 shares of the Schedule 13G filed on February 8, 2018, which was filed and reported jointly by Wellington Management Group LLP, Wellington Group Holdings LLP, Wellington Investment Advisors Holdings LLP, and Wellington Management Company LLP.Company’s Common Stock.

Directors and Executive Officers

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), requires the Company’s directors and executive officers and persons who own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes of ownership of Common Stock and other equity securities of the Company. To the Company’s knowledge, based solely upon a review of such reports and written representations, the Company believes that all reports required by Section 16(a) of the Exchange Act to be filed by its directors and executive officers during the last fiscal year were filed in a timely manner.

¹ The business address for each Beneficial Owner is 555 Capitol Mall, Suite 1255, Sacramento, California 95814, and the mailing address for each Beneficial Owner is 1901 Churn Creek Road, Redding, California 96002.

² *Represents less thanmanner, except that Mr. Tullis filed a Form 4 one percent of outstanding Common Stock.

³ Includes 63,264day late with respect to shares held in a trust of which Mr. Bennett is a trustee and 2,000 shares held jointly with his spouse.

⁴ Includes 4,132 shares held jointly with Mr. Burks’ spouse and 5,000 options that could be exercised within sixty days following March 1, 2018.

⁵ Includes 18,766 shares held jointly with Mr. Eslick’s spouse, 21,196 shares held for Mr. Eslick’s account in the Company’s 401(k) retirement plan, and 22,000 options that could be exercised within sixty days following March 1, 2018.

⁶ All shares are held in a trust of which Mr. Gibson is a trustee.

⁷ All shares are held in a trust of which Mr. Halfhide is a trustee.

⁸ Includes 28,457 shares held jointly with Mr. Jimenez’s spouse and 35,792 shares held for Mr. Jimenez’s account in the Company’s 401(k) retirement plan.

⁹ Includes 665 shares held in a trust of which Mr. Muttera is a trustee, 4,446 shares held for Mr. Muttera’s account in the Company’s 401(k) retirement plan, and 20,000 options that could be exercised within sixty days following March 1, 2018.

¹⁰ Includes 77,756 shares held jointly with Mr. Scott’s spouse, 204 shares held individuallypurchased by his spouse 16,819 shares held in his spouse’sthrough an individual retirement account, and 7,196 shares held in a 401(k) retirement plan. Mr. Scott has 76,041 shares of Common Stock pledged as security. Mr. Scott retired from the Board and ceased to be a director on March 20, 2018.account.

¹¹ Includes 11,500 shares held in a trust of which Mr. Silberstein is a trustee.

¹² Includes 5,000 shares held in a trust over which Mr. Street has investment power and 42,000 shares held in a 401(k) retirement plan.

¹³ Includes 12,770 shares held for Mr. Sundquist’s account in the Company’s 401(k) retirement plan.

¹⁴ Includes 23,560 shares held by Mr. Tullis’ spouse in individual retirement accounts.

INFORMATION ABOUT THE DIRECTOR NOMINEES

Information regarding each director nominee is provided below, including each nominee’s name, age as of the Record Date, the year first elected as a director of the Company, principal occupation, and work history during the past five years. There are no family relationships among any of the directors or named executive officers. All directors of the Company also currently serve as directors of Redding Bank of Commerce, the Company’s banking subsidiary. None of the director nominees has served as a director of another public company during the past five years.

¹ The business address for each Beneficial Owner is 555 Capitol Mall, Suite 1255, Sacramento, California 95814, and the mailing address for each Beneficial Owner is 1901 Churn Creek Road, Redding, California 96002.

² *Represents less than one percent of outstanding Common Stock.

³ Includes 63,264 shares held in a trust of which Mr. Bennett is a trustee and 2,000 shares held jointly with his spouse.

⁴ Includes 9,132 shares held jointly with Mr. Burks’ spouse.

⁵ Includes 24,779 shares held jointly with Mr. Eslick’s spouse, 20,418 shares held for Mr. Eslick’s account in a 401(k) retirement plan, and 20,000 options.

⁶ All shares are held in a trust of which Mr. Gibson is a trustee.

⁷ All shares are held in a trust of which Mr. Halfhide is a trustee.

⁸ Includes 31,018 shares held jointly with Mr. Jimenez’s spouse and 31,101 shares held for Mr. Jimenez’s account in a 401(k) retirement plan.

⁹ Includes 671 shares held in a trust of which Mr. Muttera is a trustee, 11,281 shares held for Mr. Muttera’s account in a 401(k) retirement plan, and 20,000 options.

¹⁰ Includes 14,500 shares held in a trust of which Mr. Silberstein is a trustee.

¹¹ Includes 12,000 shares held in a trust of which Mr. Street is a trustee.

¹² Includes 122,570 shares held in a trust of which Mr. Sundquist is a trustee and 15,228 shares held for Mr. Sundquist’s account in a 401(k) retirement plan.

¹³ Includes 27,810 shares held by Mr. Tullis’ spouse in individual retirement accounts.

Orin N. Bennett

Mr. Bennett, 69,70, has been a director of Redding Bank of Commerce since September 2005 and of the Company since May 2006.

Business Experience: Mr. Bennett is a registered Civil Engineer in California and Oregon. He formed a civil engineering business in 1995 that in 2008 became Bennett Engineering Services in Roseville, California, which provides civil engineering services primarily in California. Mr. Bennett also is a partner in BD Properties, LLC, a real estate investment company. Mr. Bennett was employed by the international engineering firm of CH2M Hill prior to forming his own civil engineering business in 1979. Mr. Bennett’s knowledge of the Sacramento market and his real estate experience offer insight into the existing opportunities for a community bank to provide its services and operations and make his continued service on the Board a valuable asset.

Committees: Mr. Bennett serves on the Executive, Executive Compensation, Long-Range Planning, and Nominating and Corporate Governance committees of the Board. He also serves as Chairman of the Redding Bank of Commerce Loan Committee.

Gary R. Burks

Mr. Burks, 63,64, has been a director of Redding Bank of Commerce since June 2007 and of the Company since May 2008.

Business Experience: Mr. Burks has been General Manager of Blach Beverage LLC (an Anheuser-Busch wholesale company) since 2018. Prior to that, he was Vice President and General Manager of Foothill Distributing Company, Inc. (an independent wholesale company of Anheuser-Busch Companies LLC) in Redding sincefrom 1991 to 2018 and hashad over twenty years of experience on its board. He currently serves on the Board of Directors of the Redding Colt 45s, a collegiate summer baseball team. He formerly volunteered as a Loaned Executive for the Greater Redding Chamber of Commerce, served as president of Redding Rotary, was an Executive Board member of the Greater Redding Chamber of Commerce, and was on the Corporate Governance Committee of the United Way of Northern California. Mr. Burks’ experience in running a large-scale company and his involvement in many academic and community activities make him a valuable member of the Board.

Committees: Mr. Burks serves as Chairman of the Nominating and Corporate Governance Committee and serves on the Audit and Qualified Legal Compliance Committee (the “Audit Committee”), Executive Compensation, and Long-Range Planning committees of the Board. Mr. Burks also serves on the Technology Committee of Redding Bank of Commerce.

Randall S. Eslick

Mr. Eslick, 60,61, has been a director of Redding Bank of Commerce and of the Company since November 2013.

Business Experience: Please see below underthe section entitled “Named Executive Officers of the Company.” Mr. Eslick joined the Company in 2001. He servespreviously served on the board of directors of River Oak Center for Children and is its former board president. His experience with the Company, extensive career in banking, and reputation in the community make him a valuable member of the Board.

Committees: Mr. Eslick serves on the Long-Range Planning Committee of the Company. Because Mr. Eslick is an employee of the Company and is not considered independent by NASDAQ Stock Market (“NASDAQ”) listing standards and SEC regulations, he is not a member of any other Board committees. Mr. Eslick is invited to attend all Board committee meetings other than executive sessions as a guest; however, he does not participate in any portion of a meeting during which his compensation is discussed. Mr. Eslick presently serves on the ALCO, CRA, Loan, and Technology committees of Redding Bank of Commerce.

Joseph Q. Gibson

Mr. Gibson, 70,71, has been a director of Redding Bank of Commerce since November 2009 and of the Company since May 2010.

Business Experience: Mr. Gibson has been an insurance agent for over twenty-fivethirty-seven years and has forty years of experience in business management. He was an owner of SFI Insurance, Inc. from 19921982 until it merged with George Petersen Insurance in 2017, and he was a teacher and administrator for Anderson Union High School from 1973 to 2003. He currently serves on the Anderson Union High School Board, Shasta College Foundation Board, Shasta Trinity Regional Occupation Program Board, and Shasta Historical Society Board. He is past president of Riverview Golf and Country Club and past president of the Anderson Rotary. Mr. Gibson’s extensive experience in the insurance industry, as well as his experience working with various organizations involved in academic and community activities, makes him a valuable member of the Board.

Committees: Mr. Gibson serves on the Long-Range Planning Committee of the Board. He also serves the Redding Bank of Commerce board as Chairman of the CRA Committee and as a member of the ALCO and Technology committees.

Jon W. Halfhide

Mr. Halfhide, 60,61, has been a director of Redding Bank of Commerce since July 2005 and of the Company since May 2006. He was appointed Vice Chairman of the Board of the Company and of Redding Bank of Commerce in February 2013.

Business Experience: Mr. Halfhide has been a health care consultant since 2013 and serves onas Chairman of the board of directors and on the Investment and Audit Committees of Shasta Regional Community Foundation.Foundation, as Chairman of its Investment Committee and Executive Chair and member of its Audit Committee. From January 2000 to January 2013, Mr. Halfhide served as president of Dignity Healthcare North State Service Area and St. Elizabeth Community Hospital. He has twenty-eight years of management experience with Dignity Healthcare and has served in the capacity of Controller, Chief Financial Officer and Chief Executive Officer with Dignity Health North State. Mr. Halfhide also served on the non-profit board of directors of Mercy Foundation North and Catholic Healthcare West North State and on the non-profit board of directors of the Tehama County Economic Development Corporation. Mr. Halfhide’s experience as a certified public accountant, his designation as an audit committee financial expert, his knowledge of running a health care facility, and his involvement in community activities make his continued service to the Board a valuable asset.

Committees: Mr. Halfhide serves as Chairman of the Executive Compensation Committee and is a member of the Audit, Executive, and Long-Range Planning committees of the Board. He qualifies as an audit committee financial expert under SEC regulations. He also serves the Redding Bank of Commerce board as Chairman of the ALCO Committee and as a member of the Technology Committee.

David J. Inderkum

Mr. Inderkum, 63, has been a director of Redding Bank of Commerce and of the Company since January 2019 following his nomination by the Nominating and Corporate Governance Committee and election by the boards of directors of the Company and Redding Bank of Commerce pursuant to the Agreement and Plan of Merger by and between the Company and Merchants Holding Company (“Merchants”) entered into in connection with the Company’s acquisition of Merchants, which required that the Company appoint to its Board and to the board of directors of Redding Bank of Commerce one director then serving as a director of Merchants and to nominate that person for election as a director of the Company at the Annual Meeting.

Business Experience: Mr. Inderkum has been involved with his family’s business, Coast Line Supply and Equipment located in Sacramento, California, since 1979 and has been its owner since 1998. He was a board member of The Merchants National Bank of Sacramento starting in 2003 and a board member of Merchants Holdings Company starting in 2008 until they were acquired by the Company in 2019. He has been a member of the non-profit Sportsmen’s Legacy Foundation since 2001 and has been their President/Chairman of the Board since 2012. He has also been an active member of The Sutter Club since 2003. Mr. Inderkum’s prior experience with Merchants provides valuable knowledge to the Company as it continues the integration process.

Committees: Mr. Inderkum serves on the Long-Range Planning Committee of the Board.

Linda J. Miles

Ms. Miles, 64,65, has been a director of Redding Bank of Commerce since July 2013 and of the Company since May 2014.

Business Experience: Ms. Miles served as Executive Vice President and Chief Operating Officer of the Company and of Redding Bank of Commerce from May 2009 until her retirement in February 2013. From January 1996 to April 2009, she served as Executive Vice President and Chief Financial Officer of the Company. From October 1989 to December 1995, she served as Senior Vice President and Chief Financial Officer of the Company. Before joining the Company, Ms. Miles was Senior Vice President and Chief Financial Officer at another California independent financial institution. Ms. Miles’ institutional knowledge, community banking experience and extensive history with the Company make her a valuable member of the Board.

Committees: Ms. Miles serves on the Long-Range Planning Committee of the Board. She also serves the Redding Bank of Commerce board as Chairwoman of the Technology Committee and as a member of the ALCO and CRA committees.

Karl L. Silberstein

Mr. Silberstein, 61,62, has been a director of Redding Bank of Commerce and of the Company since June 2016.

Business Experience: Mr. Silberstein has thirty-nineforty years of combined professional experience in public accounting and financial executive leadership. SinceFrom 2011 to 2019, he has beenwas Senior Vice President, Financial Operations at Dignity Health, a healthcare company with $12 billion in annual revenue, and he has held various other positions with Dignity Health since 2000. He also servesserved as staff to its Audit Committee. He has twelve years of experience as a certified public accountant providing auditing and consulting services. Mr. Silberstein’s experience as a certified public accountant, designation as an audit committee financial expert, and service on numerous other corporate and non-profit boards, including roles as chair and president, make him a valuable member of the Board.

Committees: Mr. Silberstein serves as Chairman of the Audit Committee and qualifies as an audit committee financial expert under SEC regulations. He is also a member of the Long-Range Planning Committee of the Board.

Terence J. Street

Mr. Street, 63,64, has been a director of Redding Bank of Commerce since August 2012 and of the Company since May 2013.

Business Experience: Mr. Street has been the general manager of the general contracting division of Clark Pacific, which manufactures prefabricated building systems, since 20152014 and is the past President of Roebbelen Contracting, Inc. located in El Dorado Hills, California. Mr. Street serves on the non-profit board of directors of Mercy Foundation Sacramento and of Cristo Rey High School. He is past Chairman of the Board of United Business Bank, is a past director of the Construction Employers’ Association, is past Chairman of the Board of Trustees of Jesuit High School, and was formerly a board member of the Catholic Foundation of the Sacramento Dioceses.Diocese. Mr. Street’s business acumen, integrity, leadership and knowledge of the Sacramento market as well as his community service make him a valuable member of the Board.

Committees: Mr. Street serves on the Audit, Long-Range Planning, and Nominating and Corporate Governance committees of the Board. He also serves on the Loan Committee of Redding Bank of Commerce.

Lyle L. Tullis

Mr. Tullis, 68,69, has been a director of Redding Bank of Commerce and of the Company since May 2003. Mr. Tullis was appointed Chairman of the Board of the Company and of Redding Bank of Commerce in February 2013.

Business Experience: Since February 1976, Mr. Tullis has served as president of Tullis, Inc., a general engineering construction company. Mr. Tullis is the past District Chairman of the Eureka and Shasta Districts of the Associated General Contractors of California. Mr. Tullis’ extensive business experience, which includes project financing, budgets, bidding and oversight of the final project, and his involvement in local community activities make him a valuable member of the Board.

Committees: Mr. Tullis serves as Chairman of the Executive Committee and as Chairman of the Long-Range Planning Committee and is a member of the Audit, Executive Compensation, and Nominating and Corporate Governance committees of the Board. He is also a member of the ALCO and Loan committees of Redding Bank of Commerce.

DIRECTOR COMPENSATION

Compensation paid to non-employee directors consists of cash (in the form of a monthly retainerretainers and meeting fees) and, when authorized, equity (in the form of stock awards). Directors may defer fees in accordance with the Company’s Amended and Restated 2013 Directors Deferred Compensation Plan (the “2013 Plan”Directors DCP”).

The Executive Compensation Committee is responsible for all matters related to directors’ compensation in connection with reviewing and establishing or recommending non-employee director compensation to the Board. Generally, the Executive Compensation Committee will review the amount of director compensation at least annually. For purposes of establishing director compensation, the Executive Compensation Committee evaluated directors’ compensation as compared to detailed public company information provided in September 2016 by the consulting firm McLagan, a business unit of Aon, plcplc. (“McLagan”), which provides compensation consulting, operational benchmarking and best practice research across financial industries.

A director who is an officer/employee of the Company or of a subsidiary does not receive additional compensation for his or her membership on the Board.

Monthly RetainerRetainers and Meeting Fees

During 2017, each independent director received aMonthly retainers and meeting fees for service on the Company’s Board are detailed in the following table. Upon the retirement of David H. Scott on March 20, 2018, the Board reevaluated its compensation structure and eliminated the monthly retainer of $800, the Chairman of the Board received an additional $1,200 per month, and the Chairman of the Audit Committee received an additional $1,000 per month. In addition, meeting fees were paid as follows: $800 per board meeting, $775 per committee meeting for the Chairperson of the respective committee,Audit Committee and $400 per committee meetinginstituted a per-meeting fee for non-Chairperson committee members.that role. In addition to the fees outlined in the table, independent directors received fees for their service on the Redding Bank of Commerce board of directors and its respective committees. The 20172018 compensation for each director is shown in the section entitled “Director Compensation Table.” section below.

Equity Compensation

In 2007, the Company adopted the 2008 Stock Option Plan, which was amended and restated in 2010 and 2012 and is now known as the Amended and Restated 2010 Equity Incentive Plan (the “2010 Equity Plan”). Non-employee directors are eligible to receive equity awards under the 2010 Equity Plan.

Directors’ Deferred Compensation Plans

On December 19, 2013, the Board adopted a directors’ deferred compensation plan, which was amended and restated on February 20, 2018 and is referred to herein as the 2013 Plan,Directors DCP, to replace the directors’ deferred compensation plan dated January 1, 1993, as amended (the “1993 Plan”Directors DCP”). Both plans are nonqualified director benefit plans through which an eligible director may voluntarily elect to defer some or all of his or her current fees in exchange for the Company’s promise to pay a deferred benefit. The deferred fees are credited with interest, and the accrued liability is paid to the director upon separation from service. Directors may not defer additional compensation once their total deferred benefit reaches $500,000.

Amounts held in accounts under the 2013 PlanDirectors DCP are credited with interest at a rate equal to the Bloomberg 20-year Investment Grade Financial Institutions Index rate (or a similar reference rate selected by the Company if the Bloomberg rate is not published) in effect on the immediately preceding December 31, plus two percent. The obligations under the 1993 PlanDirectors DCP will continue to accrue interest; however, as of December 31, 2013, no additional deferrals may be made under the 1993 Plan.Directors DCP. The interest rate applicable to amounts held in accounts under the 1993 PlanDirectors DCP is the Wall Street Journal prime rate in effect on the first business day of January and July plus three percent, with an option to change to a fixed rate of ten percent, at the director’s election, immediately preceding termination of service.

No deferred compensation will be payable to a director until separation from service, whereupon all deferred compensation, together with interest thereon, will be paid in accordance with the terms of the respective plan in one lump sum or in installments if the director made such an election.

As of December 31, 2017,2018, the Company’s accrued obligations under the 2013 PlanDirectors DCP and the 1993 PlanDirectors DCP totaled $3,822,044.$3,845,865.

Director Compensation Table 

The following table shows compensation paid to or accrued by non-employee directors during the fiscal year ended December 31, 20172018 for service on the boards of the Company and of Redding Bank of Commerce. Because Mr. Inderkum was elected to the boards of the Company and of Redding Bank of Commerce in 2019, he is not included in the table.

¹ See the section entitled “Monthly Retainers and Meeting Fees.”

² Total represents fees earned or paid in cash from January 1, 2018 until Mr. Scott’s retirement on March 20, 2018 and nonqualified deferred compensation earnings for the full year 2018.

THE BOARD BOARD COMMITTEES AND GOVERNANCE MATTERS

Corporate Governance Guidelines

The Board is committed to sound and effective corporate governance principles and practices. The Board has adopted corporate governance guidelines to provide the framework for the governance of the Company. These guidelines set forth director qualifications and standards of independence and mandate that at least a majority of the Board and all the members of the Audit Committee, Executive Compensation Committee and the Nominating and Corporate Governance Committee meet the criteria for independence.

Highlights of the Company’s corporate governance practices are described below. To fulfill its role, the Board, acting directly or through a Board committee, must perform the following primary functions:

¹ See the section above entitled “Monthly Retainer and Meeting Fees.”

² There were no stock options awarded to any of the directors during 2017. As of December 31, 2017, Mr. Burks held 5,000 vested stock options with an exercise price of $5.56 per share.

In discharging these obligations, directors are entitled to rely reasonably on the honesty and integrity of their fellow directors, the Company’s executive officers, and the Company’s outside advisors and auditors. Directors will be entitled to reasonable directors’ and officers’ liability insurance obtained on their behalf, the benefits of indemnification to the fullest extent permitted by law under the Company’s articles, bylaws and any indemnification agreements, and exculpation as provided by state law and the Company’s articles.

The Board is committed to good business practices, transparency in financial reporting and high standards of corporate governance. The Company operates within a comprehensive plan of corporate governance for the purpose of defining responsibilities, setting high standards of professional and personal conduct and assuring compliance with such responsibilities and standards. The Board regularly monitors developments in the area of corporate governance. The Board periodically reviews the Company’s governance policies and practices against those suggested by various groups or authorities active in corporate governance and the practices of other companies, as well as the requirements of applicable law, NASDAQ listing standards and SEC regulations.

Executive Officers

The Board recognizes that the actual management of the business and affairs of the Company is conducted by the Chief Executive Officer and other senior executives under his supervision. In performing the management function, the Chief Executive Officer and other senior executives are obliged to act in a manner that is consistent with the oversight functions and powers of the Board and the standards of the Company and to execute any specific plans, instructions or directions of the Board.

Code of Conduct, Code of Ethics and Corporate Governance Documents

The Board has adopted a Code of Conduct that applies to all of the Company’s directors, officers and staff and a Code of Ethics that applies to the principal executive officer and principal financial officer, or any person serving in those capacities. The Code of Conduct and Code of Ethics embody the Company’s commitment to high standards of ethical and professional conduct. All directors, officers and staff are required to certify annually that they have read and complied with the Code of Conduct. The Code of Conduct consists of basic standards of business practice as well as professional and personal conduct. You may access the Code of Ethics and the current charters of the Audit Committee, Executive Compensation Committee, and Nominating and Corporate Governance Committee, as well as the articles and bylaws, by visiting the Company’s corporate website at www.bankofcommerceholdings.com or by writing to Bank of Commerce Holdings, Attention: Corporate Secretary, 1901 Churn Creek Road, Redding, California 96002.

Board Leadership Structure

The Board is committed to maintaining an independent Board. To that end, the Company separates the duties of Chairman and Chief Executive Officer. The Board believes that the separation of duties of Chairman and Chief Executive Officer eliminates any inherent conflict of interest that may arise when the roles are combined and that a non-employee director who is not serving as an executive of the Company can best provide the necessary leadership and objectivity required as Chairman.

Role in Risk Oversight

The Board has ultimate authority and responsibility for overseeing risk management of the Company. Some aspects of risk oversight are fulfilled at the full Board level. Additionally, the Board, or a committee of the Board, receives specific periodic reports from management on credit risk, liquidity risk, interest rate risk, capital risk, operational risk and economic risk. The Audit Committee oversees financial, accounting and internal control risk management. The internal audit function and the independent registered public accounting firm report directly to the Audit Committee. The Executive Compensation Committee oversees the management of risks that may be posed by the Company’s compensation practices and programs.

Chairman of the Board

The Board appoints one of its independent members to serve as the Chairman of the Board. The Chairman chairs all regular sessions of the Board and, with input from the Chief Executive Officer to the extent appropriate, sets the agenda for Board meetings, subject to the right of each board member to suggest agenda items.

Size of Board

The exact number of directors shall be fixed from time to time by the Board within the requirements of the Company’s articles and bylaws. In June 2016, the Board determined that the appropriate size of the Board would be ten members. At its February 2018 meeting, after review of the director nominees, the Board determined thatset the appropriate sizenumber of the Board would bedirectors at nine, members effective March 20, 2018 and upon the retirement of Mr. ScottScott. At its January 2019 meeting, in accordanceconnection with the Company’s Director Policy, which states thatacquisition of Merchants, the retirement age forBoard increased the number of directors of the Company is upon reaching the age of seventy-four years.to ten, effective January 31, 2019.

Director Qualifications

The Board must consist of a majority of directors who meet the independence criteria required by applicable law, NASDAQ listing standards, and SEC regulations, and as adopted by the Board.

Qualifications

A director should possess personal and professional integrity, have good business judgment, and have relevant experience and skills to be an effective director in conjunction with the full Board in collectively serving the long-term interests of the Company’s shareholders. Directors should be committed to devoting sufficient time and energy to diligently performing their duties as directors.

Selection Process

In accordance with the policies and principles in its charter, the Nominating and Corporate Governance Committee is responsible for identifying and recommending potential director nominees to the Board for its approval when there is a vacancy on the Board and for each annual meeting of shareholders. The selection process is discussed in detail in the section entitled “Director Qualifications and the Nomination Process.”

Director Orientation and Continuing Education

All new directors participate in an orientation program during their first year as a director. As part of the orientation, each director receives, among other materials, copies of the Company’s articles, bylaws, committee charters, policies, and the strategic plan. Orientation also includes presentations by senior management to familiarize new directors with the Company’s strategic plans, significant financial, accounting and risk management issues, compliance programs, and conflict policies. Each director is required to review and sign the Company’s Insider Trading Policy and the Code of Conduct. A new director will attend a meeting with the Chief Executive Officer and Chief Financial Officer to be briefed on Board reports, significant financial, accounting and risk management issues, and current and potential projects.

All directors receive annual director education in subjects relevant to the duties of a director, including the study of corporate governance best practices and ethics. The Board requires directors to participate in continuing education programs and reimburses directors for the expenses of such participation. All directors successfully complete each training coursecourses assigned to them each year.

Board Attendance and Annual Meeting Policy

Directors are expected to attend all Board meetings and all meetings of committees on which they serve. Directors are expected to devote an adequate amount of time and effort to properly discharge their responsibilities. Information and data are important to the Board’s understanding of the business, and the Company distributes materials to the directors sufficiently in advance of each meeting to permit their review.

The Board held fourteen meetings during 2017.2018. All directors attended at least seventy-five percent of the aggregate number of meetings of the Board and of the committees on which such director served. The Company does not have a formal policy requiring the attendance of its directors at each annual meeting of shareholders; however, directors are encouraged to attend. The Company had tennine directors at the time of its 20172018 annual meeting, and all teneight were in attendance.

DIRECTOR INDEPENDENCE;INDEPENDENCE, CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Director Independence

The Nominating and Corporate Governance Committee has reviewed the applicable legal standards for Board and Board committee member independence and the criteria applied to determine audit committee financial expert status. The Board has analyzed the independence of each director and nominee and has determined which nominees and members of the Board meet the standards regarding independence required by applicable law, NASDAQ listing standards, and SEC regulations, and whether or not each such director nominee is free of relationships that would interfere with the individual exercise of independent judgment. In determining the independence of each director, the Board considered many factors, including any loans to the directors, each of which (i) were made in the ordinary course of business; (ii) were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to the Company or Redding Bank of Commerce; and (iii) did not involve more than the normal risk of collectability or present other unfavorable features. Such arrangements are discussed in detail in the section entitled “Certain Relationships and Related Transactions.”

Based on these standards, the Board has determined that each of the following non-employee directors and director nominees is independent:

Randall S. Eslick, who serves as President and Chief Executive Officer of the Company, is not independent because he is currently an executive officer of the Company.

All of the members of the Audit Committee, Executive Compensation Committee, and Nominating and Corporate Governance Committee are independent.

Directors’ Access to Officers, Employees and Independent Advisors

Directors are encouraged to keep themselves informed with regard to the Company and its operations. Directors have full and free access to Company officers and employees. Any meetings or contacts that a director wishes to initiate may be arranged through the Chief Executive Officer, Chief Financial Officer or directly by the director. Directors will use their judgment to ensure that any such contact is not disruptive to the Company’s business operations and will, to the extent that it is appropriate, copy the Chief Executive Officer on any written communications between a director and a Company officer or employee.

Communications with the Board of Directors

Shareholders may contact an individual director, the Board as a group, or a specified committee or group by sending a written communication to Bank of Commerce Holdings, Attention: Corporate Secretary, 1901 Churn Creek Road, Redding, California 96002. Each communication should specify the applicable addressee(s) to be contacted as well as the general topic of the communication.

The Company will receive and process communications before forwarding them to the addressee(s). The Company generally will not forward to the directors a shareholder communication that it determines to be primarily commercial in nature, that relates to an improper or irrelevant topic, or that requests general information about the Company.

Certain Relationships and Related Transactions

Policy and Procedures on Related Person Transactions

The Company adopted its Code of Conduct to promote a “tone at the top” of the highest ethical standards within the Company. The Code of Conduct requires all Company personnel to immediately disclose situations that might create a conflict of interest, or the perception of a conflict of interest, which include transactions involving entities with which such personnel are associated. The Board recognizes that related person transactions present a heightened risk of conflicts of interest and/or improper valuation, or the perception thereof. Such transactions, after full disclosure of the material terms to the Board, must be approved by a majority of the members of the Board who are not parties to the specific transaction. The Board will determine whether or not the transactions are just and reasonable to the Company at the time of such approval, with those members of the Board, if any, who have an interest in the transaction abstaining. Such procedures are consistent with the terms of California corporate law. The Company has a Regulation O Policy that it follows relating to loans to its executive officers, directors and principal shareholders.

Lending and Other Ordinary Business Transactions

Redding Bank of Commerce has had and expects to have banking transactions in the ordinary course of business with some of the directors and named executive officers, as well as some of their family members and/or affiliated entities. All transactions were on substantially the same terms, including interest rates, collateral and repayment, as those available at the time for similar transactions with unrelated parties. None of the loans or credit transactions involved more than the normal risk of collectability or presented other unfavorable features.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board has established, among others, a standing Audit Committee, Executive Compensation Committee, and Nominating and Corporate Governance Committee. All members of these three committees meet the standards of independence defined by applicable law, NASDAQ listing standards and SEC regulations. In addition, the members of the Executive Compensation Committee meet the applicable standards of independence defined by IRS regulations. All directors participate in the long-range planning

You may access the current charters of the Audit Committee, Executive Compensation Committee, and Nominating and Corporate Governance Committee, as well as the articles and bylaws, by visiting the Company’s corporate website at www.bankofcommerceholdings.com or by writing to Bank of Commerce Holdings, Attention: Corporate Secretary, 1901 Churn Creek Road, Redding, California 96002.

Information about each of these three committees of the Board, its members who served during 2017,2018, the committee’s purpose and the number of meetings held in 20172018 follows.

¹ Mr. Silberstein assumed the duties of Audit Committee Chairman upon the retirement of Mr. Scott on March 20, 2018.

¹ Mr. Silberstein assumed the duties of Audit Committee Chairman upon the retirement of Mr. Scott on March 20, 2018.

THE NOMINATING AND CORPORATE GOVERNANCE COMMITTEEDIRECTOR QUALIFICATIONS AND NOMINATIONS FOR DIRECTOR

The Nominating and Corporate Governance Committee of the Board has been delegated the responsibility to identify, evaluate and recommend for nomination candidates for election as directors. Each of the members of the Nominating and Corporate Governance Committee has been determined to be independent as defined by applicable law, NASDAQ listing standards and SEC regulations.

The goal of the Nominating and Corporate Governance Committee’s nominating process is to assist the Company in attracting competent individuals with the requisite management, financial and other expertise who will serve as directors and act in the best interests of the Company and its shareholders. The Nominating and Corporate Governance Committee consults with other Board members, the Company’s Chief Executive Officer and other Company personnel in this process. The Nominating and Corporate Governance Committee will consider an individual recommended by a shareholder for nomination as a director provided that the shareholder making the recommendation follows the procedures for submitting a proposed nominee’s name and provides the required information described below.

Director Qualifications and the Nomination Process

The Nominating and Corporate Governance Committee regularly reviews the composition of the Board in light of its understanding of the backgrounds, industry, professional experience and the various communities, both geographic and demographic, represented by the current members. It also monitors the expected service dates of Board members, any planned retirement dates and other anticipated events that may affect a director’s continued ability to serve. The Nominating and Corporate Governance Committee periodically reviews Board self-evaluations and information with respect to the business and professional expertise represented by current directors in order to identify any specific skills desirable for future Board members.

The Board has approved certain minimum standards for first-time director candidates, and the Nominating and Corporate Governance Committee has developed a process for identifying and evaluating first-time nominees in light of these standards and other such factors as deemed appropriate. These standards and the evaluation process apply to all first-time director nominees, including those nominees recommended by shareholders. This process is based on the Nominating and Corporate Governance Committee’s familiarity with the composition of the current Board, its awareness of anticipated openings and its assessments of desirable skills or expertise.

The Board has approved the following minimum qualifications for first-time nominees for director, including nominees recommended by shareholders, for election to the Company’s Board: (i) a demonstrated breadth and depth of management and/or leadership experience, preferably in a senior leadership role (i.e., chief executive officer, managing partner, president, chief financial officer, etc.); (ii) financial literacy or other professional or business experience relevant to an understanding of the Company and its business; and (iii) a demonstrated ability to think and act independently and work constructively in a group environment. The Nominating and Corporate Governance Committee will determine, in its sole discretion, whether or not a nominee meets these minimum qualifications. The Nominating and Corporate Governance Committee does not assign specific weights to particular criteria, and, aside from the minimum qualifications, no particular criterion is necessarily applicable to all prospective nominees. The Company believes that the backgrounds and qualifications of the directors, considered as a group, should provide a significant and diverse composite mix of experience, knowledge and abilities that will allow the Board to fulfill its responsibilities.

The Nominating and Corporate Governance Committee also will consider if such candidate meets the independence standards defined by NASDAQ listing standards, SEC regulations and any additional requirements imposed by law or regulation on the members of the Audit Committee, Executive Compensation Committee, and the Nominating and Corporate Governance Committee of the Board.

Following the initial review, the Nominating and Corporate Governance Committee’s designee arranges an introductory meeting with the candidate, and the Company’s Chief Executive Officer and the Chairman of the Board and(and in some cases with additional directors,directors) to determine the candidate’s interest in serving on the Board.

The Nominating and Corporate Governance Committee, together with the Chief Executive Officer, then conducts a comprehensive interview with the candidate. The candidate will be asked to provide the information required to be disclosed in the Company’s proxy statement.

Assuming a satisfactory conclusion to the process, outlined above, the Nominating and Corporate Governance Committee will then recommend to the Board that it interview the candidate. After the Board-level interview, the Board will proceed in accordance with the Company’s bylaws and committee charters.

Director Nominations by Shareholders

A shareholder who wishes to submit an individual’s name for consideration by the Nominating and Corporate Governance Committee for nomination for election as a director of the Company at the 20192020 annual meeting should deliver such recommendation to the Company’s Corporate Secretary no later than December 6, 20182019 and provide (i) the shareholder’s name, address and the number of shares of Common Stock beneficially owned by the shareholder; (ii) the name of the proposed nominee and the number of shares of Common Stock beneficially owned by the nominee; (iii) sufficient information about the nominee’s experience and qualifications for the Nominating and Corporate Governance Committee to make a determination about whether or not the individual would meet the minimum qualifications for directors;director nominees; and (iv) such individual’s written consent to serve as a director of the Company, if elected. The Nominating and Corporate Governance Committee has the right to request, and the shareholder will be required to provide, such additional information with respect to the shareholder nominee as the Nominating and Corporate Governance Committee may deem appropriate or desirable to evaluate the proposed nominee in accordance with the nomination process, described above, including the information about the proposed nominee that is required to be disclosed by the Company in its proxy statement under Regulation 14A of the Exchange Act. See also the section entitled “SHAREHOLDER PROPOSALS AT 2019THE 2020 ANNUAL MEETING.” below.

EXECUTIVE COMPENSATION – COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis describes the Company’s executive compensation philosophy and objectives. The tables that follow present the compensation for 20172018 to the Company’s named executive officers. In 2017,2018, the Company had only four named executive officers because there are only four executive officers who perform a policy-making function for the Company.

Named Executive Officers of the Company

The following table and narrative sets forth information with respect to the named executive officers of the Company, including their ages and employment history for at least the last five years.

Randall S. Eslick has served as President and Chief Executive Officer of the Company since November 2013. Immediately prior, he served as Regional President of Roseville Bank of Commerce (now known as Sacramento Bank of Commerce, a division of Redding Bank of Commerce) from December 2005 to November 2013. From 2002 until December 2005, Mr. Eslick served as Senior Vice President and Regional Manager of Roseville Bank of Commerce. Mr. Eslick joined the Company in March 2001 as Senior Vice President and Commercial Loan Officer. Mr. Eslick was appointed to the Board of the Company and to the board of directors of Redding Bank of Commerce in November 2013 when he assumed the role of President and Chief Executive Officer of the Company. As the Chief Executive Officer and a director, Mr. Eslick serves as the primary liaison between the Board and management and as the executive officer with overall responsibility for executing the Company’s strategic plan.

James A. Sundquist has served as Executive Vice President, Chief Financial Officer and Principal Accounting Officer of the Company since December 2014. Prior to joining the Company, Mr. Sundquist had been retired since 2008. Mr. Sundquist has worked at several California independent financial institutions over the course of his career. From 1998-2007 he served as Executive Vice President and Chief Financial Officer, from 1996-1998 he served as Executive Vice President and Chief Operating Officer, from 1984-1995 he served as Senior Vice President and Chief Financial Officer, and from 1979-1983 he served as Vice President and Controller. Prior to his bank service, Mr. Sundquist was employed as a certified public accountant at an international public accounting firm from 1977-1979.

Samuel D. Jimenez has served as Executive Vice President and Chief Operating Officer of the Company since December 2013. Mr. Jimenez has served the Company in multiple capacities since 2003. He served as the Chief Financial Officer and Principal Accounting Officer of the Company from May 2009 to December 2014. He was promoted from Senior Vice President to Executive Vice President in March 2011. Prior to becoming Chief Financial Officer, he served as Vice President and Director of Risk Management of Redding Bank of Commerce beginning in September 2003 and was promoted from Vice President to Senior Vice President in February 2006. Mr. Jimenez was a Federal Deposit Insurance Corporation Examiner from 1992 to 2003. Mr. Jimenez is a certified public accountant. He also serves as Assistant Corporate Secretary of the Company.

Robert H. Muttera has served as Executive Vice President and Chief Credit Officer of the Company since January 2014, and he served as Executive Vice President and Chief Credit Officer of American River Bankshares from 2012-2013. Mr. Muttera served as Senior Vice President at a commercial real estate advisory firm from 2006-2012, as Executive Vice President and Chief Credit Officer of two California independent financial institutions from 1983-2005, and as Vice President and Senior Commercial Loan Officer of a California independent financial institution from 1979-1983. From 1975-1979, he was a Senior Accountantsenior accountant and Certified Public Accountantcertified public accountant at an international public accounting firm.

Named Executive Officer Compensation

Strategic Role of Executive Compensation Committee

In 2013, on an advisory basis, the Company’s shareholders voted to take advisory votes on named executive officer compensation on an annual basis. The Company has followed the guidance of its shareholders and annually requests the approval on ana non-binding advisory (non-binding) basis of the compensation of named executive officers.

The Executive Compensation Committee evaluates the Company’s executive compensation programs in light of market conditions, shareholder views, and governance considerations and makes changes as appropriate. As required by the Dodd-Frank Wall Street Reform and Consumer Protection Act and under Section 14A of the Exchange Act, the Company held an advisory vote on the compensation of its named executive officers (the “say-on-pay proposal”) at the 2017its 2018 annual meeting. The Company’s shareholders approved the compensation of named executive officers with ninety-sevenninety-eight percent of shareholder votes cast in favor of the say-on-pay proposal. As the Executive Compensation Committee evaluated the Company’s compensation programs in 2017,2018, it took into account the shareholders’ vote of confidence in the named executive officer compensation program as described below to ensure a continuedcontinue the link of pay to performance.

The Board of the Company strives to ensure that its compensation programs and practices are consistent with the strategic goals and objectives of the Company and that they maintain the Company’s high standards of effective corporate governance. The Board has appointed the Executive Compensation Committee to play a central role in formulating the Company’s compensation philosophy and programs and in making pay decisions for named executive officers. The compensation programs include elements that are designed specifically for the named executive officers.

The Company’s executive compensation philosophy and programs play an important role in achieving the objective of long-term growth in shareholder value. As a guiding principle, the Company designs its compensation programs to reward its named executive officers for recent performance and to motivate them to achieve strong future performance for the Company and long-term value for shareholders.

In keeping with the long-term Company goals and efforts to increase shareholder value and align named executive officer compensation with performance, the Executive Compensation Committee has taken certain actions over the years including:

It is the responsibility of the Executive Compensation Committee to:

Risk Assessment of Named Executive Officer Incentive Compensation Programs

In 2017,2018, the Executive Compensation Committee reviewed with the Company's Chief Risk Officer the Company's incentive compensation programs to which the Company's named executive officers were a party in order to:

After considering these items, it was the Executive Compensation Committee’s view that the Company’s compensation policies and practices did not create risks that were reasonably likely to have a material adverse effect on its business or operations.

Named Executive Officer Compensation Objectives

Based on the Company’s philosophy to link compensation to Company, business, and individual performance, the compensation programs for the named executive officers are built upon three objectives:

Named Executive Officer Compensation Components 

Named executive officer compensation for 20172018 included the following elements:

Overview of Compensation and Process 

Base salaries for named executive officers generally are reviewed and set on an annual basis by the Executive Compensation Committee.

The Executive Compensation Committee reviews and recommends the Short-Term Program and Long-Term Program for the new fiscal year to the Board for approval, reviews and approves awards granted under such programs and reports approved awards to the Board. The Executive Compensation Committee approves equity awards for the Company’s named executive officers.

It is the practice of the Executive Compensation Committee to periodically review periodically the history of all the elements of each named executive officer’s total compensation over previous years and compare the compensation of the named executive officer with that of the executive officers in an appropriate market place and peer group.

In September 2016, the Executive Compensation Committee engaged consulting firm McLagan which provides compensation consulting, operational benchmarking and best practice research across the financial industries, to review compensation for its named executive officers relative to that of similar financial institutions. McLagan presented the Executive Compensation Committee with an analysis of salaries, cash compensation (salary plus cash bonuses), direct compensation (salary plus cash bonuses plus equity/long-term compensation) and total compensation (direct compensation plus retirement benefits plus other compensation). Such analysis included a review of compensation relative to that of comparable financial institutions. In November 2017, McLagan provided the Executive Compensation Committee with a compensation review update that did not revise the peer group, but which updated information as to the asset size of the peer group members and provided updated market compensation information. A summary of the findings from the McLagan September 2016November 2017 report comparing the 2016 compensation of the Company’s named executive officers to estimated 20162018 target compensation for the market indicated that the salaries, cash compensation and direct compensation at target performance for the Company’s named executive officers were within a market competitive range.

The following financial services companies located in California, Oregon and Washington represented the peer group (the “Peer Group”) selected by the Executive Compensation Committee with McLagan’s assistance in September 2016.2016 and utilized for the November 2017 study. The primary criteria for the Peer Group included total assets, geographic locations, performance and business model. The compensation of this Peer Group’s executives was used to establish the Company’s 20172018 named executive officer compensation.salaries and awards under the Company’s 2017 Long-Term Program.

In February 2018, the Executive Compensation Committee, with the assistance of McLagan, updated the Peer Group to reflect recent merger and acquisition activity and to broaden geographic location criteria while maintaining focus on the Western United States. This updated Peer Group was utilized for peer group comparisons under the 2018 Short-Term Program (payouts under which are set forth below) and the 2018 Long-Term Program (payouts under which will be included in the Company’s proxy statement for the 2020 annual meeting).

Compensation Objectives 

The Company’s executive compensation programs are designed (i) to attract and retain well-qualified executive officers, (ii) to link executive officer compensation to the Company’s financial performance, and (iii) to reward executive officers for creating shareholder value. The Company believes its executive compensation programs achieve these objectives.

In order to set competitive benchmarks for 2017 annual2018 salaries and long-term compensation for the named executive officers, the Executive Compensation Committee reviewed data compiled in the compensation report prepared by McLagan in September 2016.November 2017. This data presented Peer Group annual cash, long-term incentive and total compensation amounts as reported in the annual filings for those companies’ executive officers whose positions and responsibilities most closely matched those of the Company’s named executive officers. For each of the Company’s named executive officers, this compensation data was examined relative to Peer Group median compensation. The Executive Compensation Committee used this information to help determine competitive benchmarks for 20172018 base salary annual cash incentive awards, and long-term compensation awards, payable in 2018 based on 2017 Company performance, for the named executive officers. As noted, the updated Peer Group established in February 2018 was utilized for purposes of the 2018 Short-Term Program and 2018 Long-Term Program.

The Executive Compensation Committee solicits input from the entire Board to review, establish and approve corporate goals and objectives relevant to the Chief Executive Officer’s compensation. At a meeting at which the Chief Executive Officer is not present, the Executive Compensation Committee evaluates the Chief Executive Officer’s performance in light of these corporate goals and objectives and determines the Chief Executive Officer’s compensation based on the evaluation. Typically, the Chief Executive Officer makes compensation recommendations to the Executive Compensation Committee with respect to the executive officers who report to him. Such executive officers are not present at the time of these deliberations.

Review of Executive Performance 

The Executive Compensation Committee annually reviews each compensation element for named executive officers. The Executive Compensation Committee takes into account the role and responsibilities, expertise, skills and years of experience of each named executive officer in comparison to competitive salary levels.

The Executive Compensation Committee may, in its sole discretion, determine that a named executive officer shall not be granted all or any portion of an incentive compensation award, regardless of having achieved the applicable financial performance goal, if the Executive Compensation Committee determines that the named executive officer has failed to comply with the Company’s Code of Ethics, Code of Conduct or another Company policy, or for any other lawful reason as determined by the Executive Compensation Committee.

Named Executive Officer Compensation 

The components of executive compensation are intended to work together to compensate the named executive officer fairly for services, reward him based upon the Company’s overall performance and reward his own performance during the year. In assessing the named executive officer’s total rewards, the Executive Compensation Committee reviews each component of his compensation and considers and evaluates pay mix, the competitive market, and the value of total pay, benefits and perquisites. The Executive Compensation Committee further takes into consideration the shareholder voting results on named executive officer compensation, which historically have indicated a high level of support.

Base Salary

Base salary generally is established by the Executive Compensation Committee based on the named executive officer’s performance, experience, competent and effective execution of strategic objectives, and level of responsibilities, with total compensation targeted at or near the 50th percentile of the comparable Peer Group.Group for targeted or budgeted performance. In setting the base salaries of the named executive officers for fiscal year 2017,2018, the Executive Compensation Committee considered the compensation packages of executives in the Company’s Peer Group, the growth and increased complexity of the Company and the Company’s level of success in its short- and long-term goals in relation to:

The Executive Compensation Committee increased Mr. Eslick’s base salary in 2017 because market studies showed that Mr. Eslick was being paid considerably less than his peers when he became the Chief Executive Officer in November 2013. The Executive Compensation Committee has executed its plan to bring Mr. Eslick’sSundquist’s base salary to a comparable level to that of his peers over the last three years. Mr. Eslick is performing attwo years after considering his extensive experience of over twenty-five years as a chief financial officer, his high level in his role,of performance and competence, and his leadership is helpingcontributions to drive positivethe Company, results.all of which supported a market competitive compensation level.

The Executive Compensation Committee increased Mr. Sundquist’sMuttera’s base salary in 2017for 2018 after considering his extensive experience of over twenty-five years as a Chief Financial Officer,chief credit officer, his high level of performance contributions to the Company and competence.job competencies, and his additional job responsibilities, all of which supported a market competitive compensation level.

Short-Term Program 

The Short-Term Program adopted in 2017 covered2018 provided for cash incentive awards and was designed to reward the Company’s named executive officers for achieving short-term financial goals, including loan and deposit growth, net income, earnings performance versus peers, and satisfactory asset quality.

The Executive Compensation Committee approved a threshold, target and maximum payout as a percentage of the base salary earned during the incentive period for each named executive officer. These targets were based on competitive market practices for each comparable position.

The table below reflects the payout opportunities that were approved for 2017:2018:

The Short-Term Program established a set of financial metrics which were intended to drive performance. Each metric had a weight assigned within the Short-Term Program. These metrics included (i) performing loan growth, (ii) core deposit growth, (iii) net income available to common shareholders, (iv) return on average assets (“ROAA”), and (v) classified ratio.

An initial threshold of return on average assets (“ROAA”)ROAA equal to 0.700.95 percent was required in order for any award to be paid out under the Short-Term Program. In addition, laddered ROAA thresholds in a range up to one1.06 percent were established to cap the maximum aggregate award earned and paid out under the Short-Term Program based on the level of ROAA performance achieved. The laddered ROAA thresholds were pro-ratedprorated and designed to ensure that an appropriate relationship existed between Company earnings and named executive officer incentives.

The Short-Term Program established a set of financial metrics which were intended to drive performance. Each metric had a weight within the Short-Term Program. These metrics included (i) performing loan growth, (ii) core deposit growth, (iii) net income available to common shareholders, (iv) ROAA, and (v) classified ratio.

The table below summarizes the weighting, performance levels established for threshold, target and maximum, and actual performance achieved in 20172018 for each metric.

¹ Gross loans, less nonaccrual loans.

² All non-maturing deposits.

³ Actual net income available to common shareholders reflects one-time adjustments for an uncertain tax position, tangible property review and cost segregation study, and acquisition expenses.

⁴ In 2018, the Company achieved ROAA of 1.19 percent; the median ROAA of the Peer Group was 1.28 percent.

⁵ Adversely classified assets divided by total capital.

The amount of incentive award paid to each named executive officer under the Short-Term Program was based on how well the Company met its targeted goals. Each metric had different thresholds and ranges and was calculated independently of other metrics to determine the total award. All awards under the Short-Term Program were subject to the discretion of the Executive Compensation Committee and the Board.

The Company's actual resultsGAAP net income reported for 2018 included (i) the year ended December 31, 2017 were impacted by significant events that were considered not indicativetax benefit from the reversal of an uncertain tax position, the core operating performancedetails of the Company or were not directly linked to the performance of the participant group as a whole. In accordance with their authority to exercise discretion as outlinedwhich are discussed in the Short-Term Program,Company’s Form 10-K; (ii) benefits from accelerated tax deductions on the Company’s 2017 tax return supported by a tangible property review and a cost segregation study; (iii) the cost in 2018 of preparing the tangible property review and the cost segregation study; and (iv) various expenses incurred during 2018 associated with the acquisition of Merchants. The Executive Compensation Committee deemed that these eventsfour items should be excluded from the determination of the achievement of the 2018 performance targets. Thus, they approved one-time adjustmentstarget because (i) management should not benefit from reversal of an uncertain tax position associated with tax years prior to the Company’s GAAP results2018; (ii) management should not benefit from accelerated tax deductions for tax year 2017; (iii) management should not be penalized for the revaluationcost to support accelerated tax deductions for tax year 2017; and (iv) management should not be penalized for the current period costs of pursuing a strategic objective (the acquisition of Merchants and its subsidiary, The Merchants National Bank of Sacramento) that was in the long-term best interests of the Company’s deferred tax assets following the signing of the Tax Cuts and Jobs Act into law, as well as the receipt of death benefits under a Bank-Owned Life Insurance policy in connection with the passing of a former executive officer.Company.

Actual 20172018 Payouts Underunder Short-Term Program