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15, 2018
1. | To elect |
2. | To approve a non-binding advisory proposal on the compensation of the Named Executive Officers. |
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| To ratify the appointment of Dixon Hughes Goodman LLP as the independent registered accounting firm for MVB for the fiscal year ending December 31, |
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4. | Any other business which may properly be brought before the meeting or any adjournment thereof. |
By Order of the Board of Directors, | ||
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Larry F. Mazza | ||
President |
Please sign and return the enclosed proxy in the enclosed self-addressed, postage-paid envelope as promptly as possible, whether or not you plan to attend the meeting in person. If you do attend the meeting, you may vote your shares in person, even though you have previously signed and returned your proxy.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 17, 2016—THE NOTICE OF MEETING, THE PROXY STATEMENT, THE PROXY CARD AND THE ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2015, ARE AVAILABLE AT http://www.mvbbanking.com/2016shareholders. DIRECTIONS TO THE ANNUAL MEETING WHERE YOU MAY VOTE IN PERSON CAN BE FOUND ON http://www.mvbbanking.com/2016shareholders.
15, 2018
A copy of this proxy statement, the proxy card and our Annual Report for fiscal year 2017(collectively, the “Proxy Materials”) can be found at the web address
www.investorvote.com/MVBF. We first made available these Proxy Materials to our shareholders on or about April 2, 2018A shareholder executing the proxy may revoke it at any time before it is voted:
(a) by notifying MVB representatives Larry F. Mazza or Lisa J. McCormick in person;
(b) by giving written notice to MVB. The revocation should be delivered to Lisa J. McCormick, Corporate Secretary, 301 Virginia Avenue, Fairmont, WV 26554;
(c) by submitting to MVB a subsequently dated proxy; or
(d) by attending the meeting and withdrawing the proxy before it is voted at the meeting.
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Each of the other proposals, including the election of directors (Proposal No. 1), and the proposal to approve a non-binding advisory proposal on the compensation of the Named Executive Officers, (Proposal No. 2) and the proposal to approve the 2016 Annual Executive Performance Incentive Plan for the executive officers of MVB (Proposal No. 3), are considered non-routine matters under applicable rules. A broker or other nominee cannot vote without instructions on non-routine matters, and therefore, broker non-votes may exist in connection with Proposals No. 1 throughand No. 3.
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PURPOSES OF MEETING
ten (10) members.
Management Nominees to the Board of
The Articles of Incorporation provide for staggered terms for directors. The twofour individuals up for election at the Annual Meeting and identified below represent managementthe nominees to the Board of Directors. BothDirectors for a term to expire in 2021. All four individuals will be elected for a three-year term. Following the election of the twofour nominees referenced below, MVB will have three classes of directors. One classdirectors, all consisting of directors will consist of twothree board members, oneexcept for the class standing for election at the Annual Meeting, whose term expires in 2021, which class will consist ofhave four board members, whilemembers.
Directors | Age as of March 21, 2018 | Director and/or Officer Since | Term to Expire | Principal Occupation During the Last Five Years | ||||
David B. Alvarez | 54 | 2013 | 2021 | President of Energy Transportation, LLC; previously President of MEC Construction, LLC | ||||
John W. Ebert | 58 | 2013 | 2021 | President - J.W. Ebert Corporation, a McDonald's Restaurant franchise of 41 stores | ||||
Dr. Kelly R. Nelson | 58 | 2005 | 2021 | Physician | ||||
Daniel W. Holt1 | 46 | 2017 | 2021 | Co-Founder and CEO of BillGo; previously President & General Manager, Managed Services at Computer Services Inc. (CSI) |
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H. Edward Dean, III |
| 47 |
| 2012 |
| 2019 |
| President & CEO – Potomac Mortgage Group, Inc. (dba MVB Mortgage), a wholly owned subsidiary of MVB Bank (acquired December 2012); Former President & CEO – Potomac Mortgage Group, LLC, Former President & CEO – George Mason Mortgage, LLC |
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J. Christopher Pallotta |
| 66 |
| 1999 |
| 2019 |
| Director – Bond Insurance Agency |
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Director Nominee Business Experience
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Management and Directors:
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Directors |
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| Director and/or |
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David B. Alvarez |
| 52 |
| 2013 |
| 2018 |
| President of Energy Transportation, LLC |
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Stephen R. Brooks |
| 67 |
| 1999 |
| 2017 |
| Member & Attorney – Flaherty Sensabaugh Bonasso PLLC (a law firm) |
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James J. Cava, Jr. |
| 50 |
| 2013 |
| 2017 |
| Managing Member – Cava & Banko, PLLC, Certified Public Accountants |
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Dr. Joseph P. Cincinnati |
| 51 |
| 2009 |
| 2018 |
| Orthopedic Surgeon |
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John W. Ebert |
| 56 |
| 2013 |
| 2018 |
| President – J.W. Ebert Corporation, a McDonald’s Restaurant franchise |
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Gayle C. Manchin |
| 68 |
| 2013 |
| 2017 |
| Retired President – WV Board of Education; Former First Lady of West Virginia (2005-2010) |
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Larry F. Mazza* |
| 55 |
| 2005 |
| 2017 |
| President & Chief Executive Officer – MVB and Chief Executive Officer– MVB Bank; Former Chief Executive Officer-MVB Harrison, Inc. |
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Dr. Kelly R. Nelson |
| 56 |
| 2005 |
| 2018 |
| Physician |
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Nitesh S. Patel |
| 52 |
| 1999 |
| 2017 |
| Business Consultant; Former President & Chief Executive Officer-D.N. American, Inc. (software development company) |
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Jimmy D. Staton |
| 55 |
| 2013 |
| 2017 |
| Executive Vice President, Venture Global LNG; Former Executive Vice President & Group CEO for NiSource Gas Transmission & Storage |
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Directors | Age as of March 21, 2018 | Director and/or Officer Since | Term to Expire | Principal Occupation During the Last Five Years | ||||
Stephen R. Brooks | 69 | 1999 | 2020 | Member & Attorney – Flaherty Sensabaugh Bonasso, PLLC (a law firm) | ||||
James J. Cava, Jr. | 52 | 2013 | 2020 | CFO - Ryan Environmental LLC & Ryan Environmental Transport, LLC, Managing Member – Cava & Banko, PLLC, Certified Public Accountants | ||||
H. Edward Dean, III | 49 | 2012 | 2019 | President & CEO – Potomac Mortgage Group, Inc. (dba MVB Mortgage), a wholly owned subsidiary of MVB Bank (acquired December 2012) | ||||
Gary A. LeDonne | 56 | 2016 | 2019 | Executive in Residence at the West Virginia University ("WVU") College of Business and Economics; previously, Partner, Ernst & Young LLP (retired) | ||||
Larry F. Mazza1 | 57 | 2005 | 2020 | President & Chief Executive Officer – MVB and MVB Bank | ||||
J. Christopher Pallotta | 68 | 1999 | 2019 | Director – Bond Insurance Agency |
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Executive Officer |
| Age as of March 28, 2016 |
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Donald T. Robinson |
| 41 |
| 2011 |
| Executive Vice President & Chief Financial Officer; Former Chief Operating Officer –MVB and President – MVB Bank; Former North Regional President – MVB |
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Executive Officer | Age as of March 21, 2018 | Officer Since | Title During the Last Five Years | |||
Donald T. Robinson | 43 | 2011 | Executive Vice President & Chief Financial Officer; Former Chief Operating Officer – MVB and President – MVB Bank | |||
David A. Jones | 55 | 2006 | Senior Vice President & Chief Risk Officer – MVB & MVB Bank; previously Senior Vice President & Chief Credit & Chief Risk Officer – MVB & MVB Bank | |||
John T. Schirripa | 55 | 2011 | Executive Vice President, Chief Commercial Lending Officer, Regional President – West Virginia, and Commercial Loan Officer – MVB Bank |
There are no family relationships among the directors, director nominees or executive officers of MVB or the Bank.
member.
Ebert.
A Governance Committee was established by MVB in December 2009. The Governance Committee’s responsibilities are defined in its Charter. The Committee, among many things, reviews the committees of the Board and membership thereof, evaluates compliance with the Director Education Policy, evaluates the current Board areas of expertise and monitors such to determine if an adjustment of Board membership is necessary. The Governance Committee will also provide oversight on issues relating to the governance and operations of MVB.
Committees of the Board
MVB has a number of standing committees as described below.
Executive Committee. Composed of David B. Alvarez, Stephen R. Brooks – Chair, James J. Cava, Jr., John W. Ebert, Larry F. Mazza, Dr. Kelly R. Nelson, Nitesh S. Patel and Jimmy D. Staton. The purpose of the Committee is to help assure that MVB fulfills the responsibilities for effective board governance of MVB and its subsidiaries by: (1) providing Board presence and continuity between meetings of the Board; and (2) providing quick response capability in the event of emergencies or for relatively routine items requiring Board action. The Committee, between meetings of the Board, exercises the powers of the Board as appropriate in any case where immediate action is required and the matter is such that a special meeting of the full Board is not deemed necessary or possible. The Committee reports the results from these meetings to the Board of Directors. The Committee met 12 times in 2015.
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The Audit CommitteeBoard of Directors of MVB has not designated Gary A. LeDonne as an individual who is considered to be an audit committee financial expert. This is true for the entire Board of Directors as well, because no oneMr. LeDonne has been identified as meeting the guidelines set forth by Section 407 of the Sarbanes-Oxley Act of 2002, for an audit committee financial expert. In the small community market area of MVB, individuals meeting the required credentials under the Act are very rare. All members of the Board of Directors are successful business owners or organization leaders and have knowledge of the requirements to run such a successful business. The directors of MVB, including those who are members of the Audit Committee, believe that having separate internal and external audits and regulatory examinations assist in ensuring proper supervision, evaluation and reporting of MVB activities.
proxy statement.
Committee:
Gayle C. Manchin
Jimmy D. Staton
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Corporate Governance ("Governance") Committee. Composed of Stephen R. Brooks, John W. Ebert, Gayle C. Manchin,Daniel W. Holt, and Dr. Kelly R. Nelson- Chair, and Nitesh S. Patel. CEO Mazza is an ex-officio member of this Committee.Nelson (Chair). The purpose of the Committee is to help assure that MVB fulfills the responsibilities for effective board governance of MVB and its subsidiaries by: (1)(i) helping MVB to create and maintain an appropriate board and committee structure; (2)(ii) assessing the skills, experience, and backgrounds necessary to effectively staff MVB boards and committees; (3)(iii) overseeing the development and updating of governance and ethics policies for MVB; (4)(iv) leading MVB in periodic assessments of the operation of MVB boards and committees and the contributions of the members; (v) and (5) monitoring of the implementation of MVB governance policies and practices. The Committee reports the results from these meetings to the Board of Directors. The Committee met fourseven (7) times in 2015.
2017. The Board of Directors has not established a formal nominating committee as the Governance Committee serves in this capacity. The Board of Directors of MVB does not maintain a separate nominating committee, nor does it have a nominating committee charter, becauseCharter was approved by the Board of Directors January 16, 2018 and a copy of the Charter is relatively small and vacancies are rare.
Theattached as Exhibit C to this proxy statement.
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has been taken and was sufficient. The Committee also confirms that such directors remain eligible to serve on the Board of Directors of a financial institution under federal and state law. For new director candidates, the Committee uses its network of contacts in MVB’s market area to compile a list of potential candidates. The Committee then meets to discuss each candidate and whether he or she meets the criteria set forth above. The Committee then discusses each candidate’s qualifications and chooses a candidate by majority vote.
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Larry F. Mazza | President and Chief Executive Officer |
Donald T. Robinson | EVP, Chief Financial Officer |
H. Edward Dean III | CEO, MVB Mortgage |
David A. Jones | SVP, Chief Risk Officer |
John T. Schirripa | EVP, Chief Commercial Lending Officer |
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of annual performance and time basedtime-based compensation, and are structured to preclude excessive and unnecessary risk-taking, and utilize performance metrics established in advance based on an annual budget and business planning process. MVB’s incentive plans also contain caps or limits
Highlights / Recent Modifications
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Base Salary |
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Short-Term Incentives | Short term incentives are tied directly to the Company’s business results as well as individual performance. Awards are paid only when business performance is |
Long-Term Incentives | Long-term equity awards incentivize executives to deliver long-term shareholder value, while also providing a retention vehicle for executive talent. In fiscal 2017, MVB granted stock options with a vesting period of five years and a term of ten years to the NEOs. For fiscal year 2018, MVB implemented a performance and time-based long-term incentive plan in which RSU performance awards vest based upon ROA (50%) and relative TSR (50%) performance over a three-year period and the time-based RSU awards with a 5-year cliff vesting schedule. |
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What MVB Does |
ü Pay-for-performance philosophy and | |
üComprehensive clawback policy | ||
ü Responsible use of shares under MVB’s long-term incentive program | ||
üEngage an independent compensation consultant | ||
üPerform an annual risk assessment of the |
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Administration In light of the high level of approval received in 2017, the conclusion was that no significant changes to compensation policies and practices were immediately warranted. However, MVB nevertheless implemented several improvements to the pay program, including changes to the long-term incentive plan and the peer group (see below), in relation to 2018 compensation practices.
1) | Pay for Performance |
2) | Sound Compensation Practices |
3) | Pay Structure |
4) | Market Competitive Compensation |
5) | Profitability Drives the Programs |
Human Resources &
TheCompensation Committee annually reviews the Human Resources & Compensation Committee Charter and all incentive plans used throughout MVB in all business lines. In this review of the incentive plans, the Compensation Committee makes a determination ofdetermines whether the plans, individually or collectively, encourage excessive risk taking, that each of the plans havehas reasonable limits and caps, and that the overall structure of the incentive plans is aligned with the interests of the stockholders. A copy of the Charter of the Human Resources &shareholders.
The Committee receives and reviews materials in advance of each meeting. These materials include information that management believes will be helpful to the Compensation Committee, as well as materials that the Compensation Committee has specifically requested. Depending on the agenda for the particular meeting, these materials may include:
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Profitabilityreports on MVB’s year over year performance and Risk. current year performance versus a peer group of companies;
In March 2015, the Committee engaged a compensation consultant, Pearl Meyer & Partners, LLC (“PM&P”), to review the competitive positioning of the executives’ compensation compared to external markets; provide a market-based framework or peer group for review; and propose potential changes to the current compensation structure for the 2016 fiscal year. The Committee has determined that PM&P is independent and that there are no conflicts of interest with respect to their work. PM&P did not perform any other services for MVB or any affiliate. Total compensation paid to PM&P for the services described herein was less than $65,000. The consulting firm examined base compensation, annual and long term incentive opportunities and future equity programs.
PM&P completed two analyses targeting banks with assets of at least $1.1 billion, “Smaller Asset Size” and at least $2.7 billion, “Larger Asset Size”.
The “Smaller Asset Size” peer group was comprised of the following 17 companies:
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The “Larger Asset Size” peer group consisted of these organizations:
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PM&P provided conclusions regarding the overall competitiveness and reasonableness of total compensation paid to executive officers. Actual total cash compensation for the Executive team was near the 75th percentile of the Smaller Asset Size reference group and the 50th percentile of the Larger Asset Size group.
PM&P recommended that MVB maintain all executive base salaries; keep the annual incentive as a “stretch” plan,
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adding qualitative measures to reward key milestones; and once MVB is public, provide full-value equity awards such as time-based restricted stock or performance vesting awards.
MVB’s talent acquisition strategy focuses on attracting and retaining executives with the experience and skills necessary to grow the organization. MVB executives have generally come from larger metropolitan areas and/or institutions that are significantly larger than the Company.MVB. In executing talent strategy, it is necessary to provide a base salary that exceeds the median of banks that are comparable to the Company’sMVB’s current asset size. Other elements of compensation are adjusted to recognize that base salaries are competitive. For example, our executives only receive an incentive
Management’s Role in the Compensation-Setting Process. Management plays a significant role in the compensation setting process. The most significant aspects of management’s role are:
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Cardinal Financial Corporation |
| Fidelity Southern Corporation |
Stock Yards Bancorp, Inc. | TriState Capital Holdings, Inc. | Peoples Bancorp, Inc. |
Univest Corporation of PA | Independent Bank Corporation (MI) | Bryn Mawr Bank Corp. |
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Bryn Mawr Bank Corp. |
| Stock Yards Bancorp Inc. |
Financial Institutions Inc. | Peapack-Gladstone Financial | C&F Financial Corp. |
Xenith Bankshares Inc. | CNB Financial Corp. | Arrow Financial Corp. |
Farmers National Banc Corp. | WashingtonFirst Bankshares Inc. | Carolina Financial Corp. |
Peoples Financial Services | Access National Corp. | Chemung Financial Corp. |
Codorus Valley Bancorp Inc. | American National Bankshares | Premier Financial Bancorp Inc. |
Southern First Bancshares Inc. | Penns Woods Bancorp Inc. | First United Corp. |
LCNB Corp. | Howard Bancorp Inc. | Unity Bancorp Inc. |
Evans Bancorp Inc. | First South Bancorp Inc. | Citizens Financial Services |
Kentucky Bancshares Inc. | SB Financial Group Inc. | Entegra Financial |
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The Chief Executive Officer also participates in Human Resources &
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Annual Evaluation. The Human Resources & Compensation Committee meets each year to evaluate the performance of the named executive officers, to set their base salaries for the next calendar year, and to consider and approve any grants to them of equity incentive compensation.
The Human Resources & Compensation Committee’s process begins with establishing individual and corporate performance objectives by the second quarter of each calendar year. The Committee engages in an active dialogue with the Chief Executive Officer concerning strategic objectives and performance targets. The Committee also reviews the appropriateness of the financial measures used in incentive plans and the degree of difficulty in achieving specific performance targets. Corporate performance objectives typically are established on the basis of a targeted return on assets and return on equity, as well as growth in earnings per share and individual goals for particular business units within MVB.
The Human Resources and Compensation Committee also considered the most recent advisory vote on executive compensation, which overwhelmingly approved the compensation of our named executive officers, and whether such compensation continues to achieve the objective of appropriately rewarding our named executive officers. In light of the high level of approval that we received in 2015, we concluded that no significant changes to our compensation policies and practices were warranted
Components of Executive Compensation
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Annual Compensation
MVB’s executive officers receive two forms of annual compensation: base salary and annual cash incentive awards. The levels of base salary and annual incentive awards for executive officers are established annually under a program intended to maintain parity with the competitive market for executives in comparable positions.
The annual compensation program is intended to target MVB performance, both in terms of the attainment of short-term and long-term goals, and to consider principally return on equity, growth in earnings per share, and return on assets.
Base Salary.Base salary is a criticalkey element of executive compensation because it provides executives with a base level of monthly income. In determining base salaries, our Human Resources &the Compensation Committee considers the executive’s qualifications and experience, scope of responsibilities and future potential, the goals and objectives established for the executive, the executive’s past performance, competitive salary practices at companies in the peer groups, internal pay equity and the tax deductibility of base salary.
See
for MVB NEOs for fiscal years 2016 & 2017:
Executive | 2016 Base Salary | 2017 Base Salary | % Change | ||||
Larry F. Mazza | $ | 625,000 | $ | 625,000 | 0.0% | ||
Donald T. Robinson | $ | 350,000 | $ | 350,000 | 0.0% | ||
H. Edward Dean III | $ | 500,000 | $ | 500,000 | 0.0% | ||
John T. Schirripa | $ | 265,000 | $ | 265,000 | 0.0% | ||
David A. Jones | $ | 250,000 | $ | 250,000 | 0.0% |
Eligibility forinstitutional investor guidelines, rules, and best practices.
Performance Rating. The Chief Executive Officer annually rates the performancegoal being retained by the Company and 40% of eachthe Net Income of our other namedthe goal being used as the basis for determining potential AIP awards to the executive officers and assigns aother incentive plans at MVB.
Performance Level Against Net Income Goal | Payout as Percent (%) of Target Incentive Opportunity |
100% | 0% |
125% | 25% |
150% | 50% |
200% | 100% |
Metric | 2017 Target | Actual 2017 Results | ||||
Net Interest Margin | 3.15% | 3.27% | ||||
Total Core Deposits | $ | 1,188,000,000 | $ | 1,124,000,000 | ||
Efficiency Ratio | 80% | 83% | ||||
Non-Performing Loans | 0.75% | 0.88% |
2018 Metrics | Weighting | Threshold | Target | Maximum |
Net Interest Margin | 25% | 3.28% | 3.30% | 3.39% |
Noninterest Bearing Deposit Growth | 25% | $145,000,000 | $148,000,000 | $162,800,000 |
Efficiency Ratio | 25% | 62.5% | 61.7% | 58.5% |
Non-Performing Loans/Total Loans | 25% | 0.80% | 0.75% | 0.60% |
Payment of Annual Incentive Awards. Annual incentive awards for each named executive officer are calculated by multiplying the weight assignedbase salary, ranging from 25% to a performance target by the target incentive award for the executive. The resulting product is then multiplied by the actual results achieved for that performance target. Management does this for each performance target,50%, with the sumopportunity to earn 85% to 150% of all performance targets for a named executive officer generally being the annual incentive award for the executive and recommended to the Human Resources and Compensation Committee.
that amount based on performance.
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TheEligibility for an annual equity award and the size of the award is based on the discretion of executive management and the Board of Directors believes thatbased on individual performance and meeting corporate performance measures. In 2017, the 2015 Stock Incentive Plan (previously approved as the Amended 2013 Stock Incentive Plan) benefits MVB by (i) assisting in recruiting and retaining the services of individualsCompensation Committee granted stock options to MVB’s executive officers to align their interests directly with ability and initiative, (ii) providing greater incentive for directors and employees, and (iii) associating the interests of directors and employeesshareholders. All but Mr. Dean’s stock option grants have a five-year vesting period with thosean expiration life span of MVB and its shareholders through opportunities for increased stock ownership.
Stock options provide MVB’s executive officersten years. Mr. Dean’s grant has a four-year vesting period with a ten-year expiration date.
Executive | Stock Options (#) |
Larry F. Mazza | 50,000 |
Donald T. Robinson | 25,000 |
H. Edward Dean III | 102,000 |
John T. Schirripa | 25,000 |
David A. Jones | 15,000 |
The Human Resources & Compensation Committee consistinghas chosen different equity vehicles for 2018 awards, including the introduction of outside directors, administers the 2015 Stock Incentive Plan.time-based and performance-based RSU awards. The Committee may delegate its authority to administer the 2015 Stock Incentive Plan to an officer of MVB. The Committee may not delegate its authority with respect to individuals who are subject to Section 16 of the Securities Exchange Act of 1934, however. As used in this summary, the term “Administrator” means the Human Resources & Compensation Committee and any delegate, as appropriate.
Employees and directors of MVB and its affiliates are eligible to participate in the 2015 Stock Incentive Plan. The Administrator may, from time to time, grant stock options to executive new hires, promotions, annual grants and director grants to eligible Participants. Equity grants of 2,000 shares or greater must be reviewed and approved by both the CEO and the Administrator. In 2015, with shareholder approval, restricted stock and restricted stock units were added to the 2015 Stock Incentive Plan.
Employees and directors of MVB and its affiliates are eligible to participate in the 2015 Stock Incentive Plan. The Administrator may, from time to time, grant stock options to executive new hires, promotions, annual grants and director grants to eligible Participants. Equity grants of 2,000 – 9,999 shares must be reviewed and approved by both the CEO and the Administrator; participants receiving 10,000 shares or greater must have approval of the Board of Directors.
Options granted under the 2015 Stock Incentive Plan may be incentive stock options or nonqualified stock options. A stock option entitles the participant to purchase shares of Common Stock from MVB at the option price. The option price will be fixed by the Administrator at the time the option is granted, but in the case of an incentive stock option, the price cannot be less than the shares’ fair market value on the date of grant. The option price may be paid in cash, or, with the Administrator’s consent, with shares of Common Stock or a combination of cash and Common Stock.
Participants may also be awarded shares of Common Stock pursuant to a stock award. The Administrator, in its discretion, may prescribe that a participant’s right in a stock award shall be nontransferable or forfeitable or both unless certain conditions are satisfied. These conditions may include, for example, a requirement that the participant continue employment with MVB for a specified period or that MVB or the participant achieves stated objectives.
The 2015 Stock Incentive Plan provides that outstanding options will become exercisable and outstanding stockperformance-based awards will bevest based upon ROA (50%) and relative TSR (50%) performance over a three-year period, with vested uponamounts ranging from 0% to 150% of target, depending on results. The time-vesting RSUs will vest solely based on continued service, following a change in control.
All5-year cliff vesting schedule.
A maximum of 2,200,000 shares of Common Stock (as amended to reflect the stock split in the form of a stock dividend approved by the shareholders of MVB in 2014), including shares subject to options issued under the predecessors to the 2015 Stock Incentive Plan, may be issued upon the exercise of options and stock awards. These limitations will be adjusted, as the Administrator determines is appropriate, in the event of a change in the number of outstanding shares of Common Stock by reason of a stock dividend, stock split, combination, reclassification, recapitalizationaward or other similar events. The terms of outstanding awards also may be adjusted by the Administrator to reflect such changes.
No option or stock award may be granted under the 2015 Stock Incentive Plan after May 20, 2023. The Board of Directors may, without further action by shareholders, terminate or suspend the 2015 Stock Incentive Plan in whole or in part. The Board of Directors also may amend the 2015 Stock Incentive Plan except that no amendment that increases the number of shares of Common Stock that may be issued under the 2015 Stock Incentive Plan or changes the class of individuals who may be selected to participate in the 2015 Stock Incentive Plan will become effective until it is approved by shareholders.
13
Perquisites and Other Benefits
first day of employment or having attained age 21, whichever is later. Under MVB’s 401(k) plan, each employee is fully vested in his or her deferred salary contributions. Employer contributions vest as per the 401(k) plan document. Employee and employer contributions are held and invested by the plan’s trustee.
14
Either party may deemAfter a Change in Control (as defined below) when also accompanied by an involuntary termination orof employment without cause ormay occur under either of the following circumstances:
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THE HUMAN RESOURCES AND COMPENSATION COMMITTEE
Jimmy D. Staton,
Stephen R. Brooks
15
Executive Compensation
SUMMARY COMPENSATION TABLE
|
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|
|
|
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|
|
|
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|
|
Name and Principal Position |
|
| Year |
|
| Salary |
|
|
| Bonus |
|
| Option Awards |
|
| Change in |
|
| All Other |
|
| Total |
| |||||
Larry F. Mazza President & CEO, MVB Financial Corp. and CEO, MVB Bank, Inc. |
|
| 2015 |
|
| $ | 643,000 |
|
|
| None |
|
|
| None |
|
| $ | 11,262 |
|
| $ | 38,518 |
|
| $ | 692,780 |
|
|
| 2014 |
|
| $ | 629,189 |
|
|
| None |
|
| $ | 313,200 |
|
| $ | 84,824 |
|
| $ | 32,733 |
|
| $ | 1,059,946 |
| |
|
| 2013 |
|
| $ | 531,453 |
|
| $ | 103,312 |
|
| $ | 43,000 |
|
| $ | 18,137 |
|
| $ | 26,957 |
|
| $ | 722,859 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Bret S. Price SVP & CFO, MVB Financial Corp. and MVB Bank, Inc. |
| 2015 |
|
| $ | 247,250 |
|
| $ | 10,000 |
|
|
| None |
|
|
| None |
|
|
| 3,199 |
|
|
| 260,449 |
| |
| 2014 |
|
| $ | 262,534 |
|
| $ | 15,000 |
|
|
| None |
|
|
| None |
|
| $ | 3,275 |
|
| $ | 280,809 |
| ||
| 2013 |
|
| $ | 24,124 |
|
|
| None |
|
| $ | 23,600 |
|
|
| None |
|
|
| None |
|
| $ | 47,724 |
| ||
Donald T. Robinson EVP, Chief Operating Officer, MVB Financial and President, MVB Bank, Inc. |
| 2015 |
|
| $ | 362,250 |
|
| $ | 20,000 |
|
|
| None |
|
| $ | 2,938 |
|
| $ | 9,617 |
|
| $ | 394,805 |
| |
| 2014 |
|
| $ | 339,453 |
|
|
| None |
|
|
| None |
|
| $ | 28,144 |
|
| $ | 7,500 |
|
| $ | 375,097 |
| ||
| 2013 |
|
| $ | 244,592 |
|
| $ | 30,062 |
|
| $ | 130,900 |
|
| $ | 8,360 |
|
| $ | 5,712 |
|
| $ | 419,626 |
| ||
|
|
|
|
|
|
|
|
|
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|
|
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|
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|
|
|
|
|
|
|
|
|
| ||
H. Edward Dean, III President & CEO, MVB Mortgage * compensation paid by MVB Mortgage |
|
| 2015 |
|
| $ | 1,468,582 |
|
|
| None |
|
| $ | 4,920 |
|
| $ | 5,728 |
|
| $ | 19,135 |
|
| $ | 1,498,365 |
|
| 2014 |
|
| $ | 1,773,934 |
|
|
| None |
|
| $ | 7,830 |
|
| $ | 15,946 |
|
| $ | 17,435 |
|
| $ | 1,815,145 |
| ||
| 2013 |
|
| $ | 1,670,066 |
|
|
| None |
|
| $ | 23,600 |
|
| $ | 13,353 |
|
| $ | 18,329 |
|
| $ | 1,725,348 |
| ||
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|
|
|
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|
|
|
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|
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|
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| ||
L. Randall Cober |
|
| 2015 |
|
| $ | 500,250 |
|
|
| None |
|
|
| None |
|
| $ | 5,176 |
|
| $ | 10,584 |
|
| $ | 516,010 |
|
EVP, MVB Insurance |
|
| 2014 |
|
| $ | 501,584 |
|
|
| None |
|
|
| None |
|
| $ | 62,714 |
|
| $ | 11,534 |
|
| $ | 575,832 |
|
* compensation paid by MVB Insurance |
|
| 2013 |
|
| $ | 295,145 |
|
|
| None |
|
| $ | 159,200 |
|
|
| None |
|
| $ | 0 |
|
| $ | 454,345 |
|
|
|
|
|
SUMMARY COMPENSATION TABLE | ||||||||||||||||||||||||||
Name and Principal Position | Year | Salary ($)1 | Bonus ($)2 | Option Awards ($)3 | Change in actuarial present value of MVB defined benefit pension plan ($) | All Other Compensation ($)4 | Total ($) | |||||||||||||||||||
Larry F. Mazza President & CEO, MVB Financial Corp. and MVB Bank, Inc. | 2017 | $ | 643,250 | $ | — | $ | 160,000 | $ | 50,652 | $ | 52,075 | $ | 905,977 | |||||||||||||
2016 | $ | 644,000 | $ | 200,000 | $ | 243,000 | $ | 25,632 | $ | 52,193 | $ | 1,164,825 | ||||||||||||||
2015 | $ | 643,000 | $ | — | $ | — | $ | 11,262 | $ | 38,518 | $ | 692,780 | ||||||||||||||
Donald T. Robinson EVP, Chief Financial Officer, MVB Financial Corp. | 2017 | $ | 374,187 | $ | — | $ | 80,000 | $ | 9,762 | $ | 9,939 | $ | 473,888 | |||||||||||||
2016 | $ | 365,250 | $ | 175,000 | $ | 451,450 | $ | 2,874 | $ | 9,517 | $ | 1,004,091 | ||||||||||||||
2015 | $ | 362,250 | $ | 20,000 | $ | — | $ | 2,938 | $ | 9,617 | $ | 394,805 | ||||||||||||||
H. Edward Dean, III President & CEO, MVB Mortgage. * compensation paid by MVB Mortgage | 2017 | $ | 996,176 | $ | 620,497 | $ | 528,400 | $ | 7,914 | $ | 28,960 | $ | 2,181,947 | |||||||||||||
2016 | $ | 1,675,753 | $ | 1,260,928 | $ | 24,300 | $ | 8,835 | $ | 25,818 | $ | 2,995,634 | ||||||||||||||
2015 | $ | 1,468,582 | $ | — | $ | 4,920 | $ | 5,728 | $ | 19,135 | $ | 1,498,365 | ||||||||||||||
David A. Jones SVP, Chief Risk Officer, MVB Financial Corp. and MVB | 2017 | $ | 250,000 | $ | — | $ | 48,000 | $ | 26,882 | $ | 8,170 | $ | 333,052 | |||||||||||||
2016 | $ | 237,501 | $ | 25,000 | $ | 12,150 | $ | 13,241 | $ | 6,813 | $ | 294,705 | ||||||||||||||
2015 | $ | 214,865 | $ | 10,000 | $ | — | $ | 5,095 | $ | 5,961 | $ | 235,921 | ||||||||||||||
John T. Schirripa EVP, Chief Commercial Lending Officer, Regional President – West Virginia, MVB Bank, Inc. | 2017 | $ | 265,000 | $ | — | $ | 80,000 | $ | 19,195 | $ | 5,905 | $ | 370,100 | |||||||||||||
2016 | $ | 261,961 | $ | 100,000 | $ | 121,500 | $ | 9,614 | $ | 5,400 | $ | 498,475 | ||||||||||||||
2015 | $ | 244,865 | $ | 50,000 | $ | — | $ | 7,741 | $ | 5,407 | $ | 308,013 |
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GRANTS OF PLAN-BASED AWARDS TABLE
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|
|
| Estimated future payouts |
| Estimated future payouts |
| All other stock awards: number of shares of stock or units (#) |
| All other option awards: number of securities underlying options (#) |
| Exercise or base price of option awards ($/sh) |
| Grant date fair value of stock and option awards | ||||||||
Name |
| Grant Date |
| Threshold |
| Target |
| Maximum |
| Threshold |
| Target |
| Maximum |
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| ||||
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|
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|
|
|
|
|
|
|
|
Larry F. Mazza |
| 2/1/2014 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 120,000 |
| 16.00 |
| 313,200 |
|
| 1/1/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 50,000 |
| 12.00 |
| 43,000 |
|
|
|
|
|
|
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|
|
|
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|
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|
|
Bret S. Price |
| 11/18/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 5,000 |
| 16.00 |
| 6,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Donald T. Robinson |
| 12/31/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 50,000 |
| 16.00 |
| 78,000 |
|
| 1/1/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 15,000 |
| 12.00 |
| 12,900 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 3/2/2015 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 2,000 |
| 13.50 |
| 4,920 | |
|
| 2/21/2014 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 3,000 |
| 16.00 |
| 7,830 |
|
| 1/1/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 10,000 |
| 12.00 |
| 8,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
L. Randall Cober |
| 5/22/2013 |
| - |
| - |
| - |
| - |
| - |
| - |
| - |
| 80,000 |
| 13.50 |
| 159,200 |
16
GRANTS OF PLAN-BASED AWARDS TABLE | ||||||||||||||||||||||||||||||||
Estimated future payouts under non-equity incentive awards | Estimated future payouts under equity incentive plan awards | All other stock awards: number of shares of stock or units (#) | All other option awards: number of securities underlying options (#) | Exercise or base price of option awards ($/sh) | Grant date fair value of stock and option awards ($) | |||||||||||||||||||||||||||
Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | |||||||||||||||||||||||||
Larry F. Mazza | 03/21/17 | — | — | — | — | — | — | — | 50,000 | 12.85 | 160,000 | |||||||||||||||||||||
02/03/16 | — | — | — | — | — | — | — | 100,000 | 12.50 | 243,000 | ||||||||||||||||||||||
Donald T. Robinson | 03/21/17 | — | — | — | — | — | — | — | 25,000 | 12.85 | 80,000 | |||||||||||||||||||||
09/21/16 | — | — | — | — | — | — | — | 100,000 | 13.25 | 415,000 | ||||||||||||||||||||||
02/03/16 | — | — | — | — | — | — | — | 15,000 | 12.50 | 36,450 | ||||||||||||||||||||||
H. Edward Dean, III | 11/07/17 | — | — | — | — | — | — | — | 100,000 | 18.26 | 522,000 | |||||||||||||||||||||
03/21/17 | — | — | — | — | — | — | — | 2,000 | 12.85 | 6,400 | ||||||||||||||||||||||
02/03/16 | — | — | — | — | — | — | — | 10,000 | 12.50 | 24,300 | ||||||||||||||||||||||
03/02/15 | — | — | — | — | — | — | — | 2,000 | 13.50 | 4,920 | ||||||||||||||||||||||
David A. Jones | 03/21/17 | — | — | — | — | — | — | — | 15,000 | 12.85 | 48,000 | |||||||||||||||||||||
02/03/16 | — | — | — | — | — | — | — | 5,000 | 12.50 | 12,150 | ||||||||||||||||||||||
John T. Schirripa | 03/21/17 | — | — | — | — | — | — | — | 25,000 | 12.85 | 80,000 | |||||||||||||||||||||
02/03/16 | — | — | — | — | — | — | — | 50,000 | 12.50 | 121,500 |
The Board of Directors of MVB believes that the successful implementation of its business strategy will depend upon attracting, retaining, and motivating able executives, managers, and other key employees. The 20152013 MVB Financial Corp. Stock Incentive Plan (Amended) provides that the Human Resources & Compensation Committee appointed by the Board of Directors of MVB has the flexibility to grant stock options, merit awards, and rights to acquire stock through purchase under a stock purchase program.
Typically, grants have a five-year vesting period with an expiration life span of ten years.
During 2016, the Compensation Committee granted 54 awards, totaling 428,000 shares at exercise prices ranging from $12.07 to $13.25 per share. The following tables summarizeexpense to be recognized with respect to such awards will be amortized over the outstanding equityvesting period, beginning in the year of the grant. During 2017, the Compensation Committee granted 56 awards, totaling 321,750 shares at fiscal year-end, December 31, 2015.
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| |||||||||||||||
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END | ||||||||||||||||||||||||||||||||
Option Awards | ||||||||||||||||||||||||||||||||
Name |
|
| Number of |
|
| Number of Securities |
|
| Equity Incentive Plan |
|
| Option Exercise |
|
| Option Expiration |
| ||||||||||||||||
Larry F. Mazza |
|
| 66,000 |
|
| - |
|
| None |
|
| $ | 9.09 |
|
| 01-01-20 |
| |||||||||||||||
|
|
| 30,000 |
|
| 20,000 |
|
| None |
|
| $ | 12.00 |
|
| 12-31-22 |
| |||||||||||||||
|
|
| 20,000 |
|
| 30,000 |
|
| None |
|
| $ | 12.00 |
|
| 01-01-23 |
| |||||||||||||||
|
|
| 24,000 |
|
| 96,000 |
|
| None |
|
| $ | 16.00 |
|
| 02-01-24 |
| |||||||||||||||
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|
|
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| |||||||||||||||
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|
|
|
| |||||||||||||||
Bret S. Price |
|
| 2,000 |
|
| 3,000 |
|
| None |
|
| $ | 16.00 |
|
| 11-18-23 |
| |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Donald T. Robinson |
|
| 12,000 |
|
| 8,000 |
|
| None |
|
| $ | 11.00 |
|
| 01-01-22 |
| |||||||||||||||
|
|
| 9,000 |
|
| 6,000 |
|
| None |
|
| $ | 12.00 |
|
| 12-31-22 |
| |||||||||||||||
|
|
| 6,000 |
|
| 9,000 |
|
| None |
|
| $ | 12.00 |
|
| 01-01-23 |
| |||||||||||||||
|
|
| 20,000 |
|
| 30,000 |
|
| None |
|
| $ | 16.00 |
|
| 12-31-23 |
| |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
H. Edward Dean, III |
|
| 4,000 |
|
| 6,000 |
|
| None |
|
| $ | 12.00 |
|
| 01-01-23 |
| |||||||||||||||
|
|
| 600 |
|
| 2,400 |
|
| None |
|
| $ | 16.00 |
|
| 02-21-24 |
| |||||||||||||||
|
|
| - |
|
| 2,000 |
|
| None |
|
| $ | 13.50 |
|
| 03-02-25 |
| |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
L. Randall Cober |
|
| 16,000 |
|
| 64,000 |
|
| None |
|
| $ | 13.50 |
|
| 05-22-23 |
| |||||||||||||||
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|
|
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|
|
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| |||||||||||||||
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OPTION EXERCISES AND STOCK VESTED – Needs Completed | ||||||||||||||
| Option Awards | Stock Awards | ||||||||||||
Name |
|
| Number of |
|
| Value Realized on Exercise |
|
| Number of (#) |
|
| Value Realized on Vesting |
| |
Larry F. Mazza |
|
| 42,180 |
|
| $ 464,219 |
|
| - |
|
| $ | - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END Option Awards | ||||||||||
Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | |||||
Larry F. Mazza | 66,000 | — | — | 9.09 | 01/01/20 | |||||
50,000 | — | — | 12.00 | 12/31/22 | ||||||
40,000 | 10,000 | — | 12.00 | 01/01/23 | ||||||
72,000 | 48,000 | — | 16.00 | 02/01/24 | ||||||
20,000 | 80,000 | — | 12.50 | 02/03/26 | ||||||
— | 50,000 | — | 12.85 | 03/21/27 | ||||||
Donald T. Robinson | 20,000 | — | — | 11.00 | 01/01/22 | |||||
15,000 | — | — | 12.00 | 12/31/22 | ||||||
12,000 | 3,000 | — | 12.00 | 01/01/23 | ||||||
40,000 | 10,000 | — | 16.00 | 12/31/23 | ||||||
3,000 | 12,000 | — | 12.50 | 02/03/26 | ||||||
20,000 | 80,000 | — | 13.25 | 09/20/26 | ||||||
— | 25,000 | — | 12.85 | 03/21/27 | ||||||
H. Edward Dean, III | 8,000 | 2,000 | — | 12.00 | 01/01/23 | |||||
1,800 | 1,200 | — | 16.00 | 02/21/24 | ||||||
800 | 1,200 | — | 13.50 | 03/02/25 | ||||||
2,000 | 8,000 | — | 12.50 | 02/03/26 | ||||||
— | 2,000 | — | 12.85 | 03/21/27 | ||||||
25,000 | 75,000 | — | 18.26 | 11/07/27 | ||||||
David A. Jones | 17,600 | — | — | 9.09 | 01/01/20 | |||||
10,000 | — | — | 12.00 | 12/31/22 | ||||||
8,000 | 2,000 | — | 12.00 | 01/01/23 | ||||||
8,000 | 2,000 | — | 16.00 | 12/31/23 | ||||||
1,000 | 4,000 | — | 12.50 | 02/03/26 | ||||||
— | 15,000 | — | 12.85 | 03/21/27 | ||||||
John T. Schirripa | 22,000 | — | — | 10.23 | 08/01/24 | |||||
15,000 | — | — | 12.00 | 12/31/22 | ||||||
12,000 | 3,000 | — | 12.00 | 01/01/23 | ||||||
1,600 | 400 | — | 16.00 | 12/31/23 | ||||||
10,000 | 40,000 | — | 12.50 | 02/03/26 | ||||||
— | 25,000 | — | 12.85 | 03/21/27 |
No options were exercised by any NEOs during 2017.
PENSION BENEFITS TABLE
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
Name |
|
| Plan Name |
|
| Number of Years |
|
| Present |
|
| Payments During |
| |
Larry F. Mazza |
|
| Allegheny Group Retirement Plan |
|
| 9.25 |
|
| $ | 358,801 |
|
| None |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bret S. Price |
|
| Allegheny Group Retirement Plan |
|
| N/A |
|
|
| N/A |
|
| None |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Donald T. Robinson |
|
| Allegheny Group Retirement Plan |
|
| 3.167 |
|
| $ | 59,958 |
|
| None |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
H. Edward Dean, III |
|
| Allegheny Group Retirement Plan |
|
| 1.417 |
|
| $ | 35,027 |
|
| None |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
L. Randall Cober |
|
| Allegheny Group Retirement Plan |
|
| 1.083 |
|
| $ | 67,890 |
|
| None |
|
PENSION BENEFITS TABLE | ||||||||
Name | Plan Name | Number of Years Credited Service (#) | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | ||||
Larry F. Mazza | Allegheny Group Retirement Plan | 9.250 | 435,085 | None | ||||
Donald T. Robinson | Allegheny Group Retirement Plan | 3.167 | 72,594 | None | ||||
H. Edward Dean, III | Allegheny Group Retirement Plan | 1.417 | 51,776 | None | ||||
David A. Jones | Allegheny Group Retirement Plan | 9.250 | 221,673 | None | ||||
John T. Schirripa | Allegheny Group Retirement Plan | 3.917 | 159,504 | None |
executive management.
Price has a written employment agreement with MVB, effective January 1, 2016 that can be renewed annually. Price’s current salary is $235,000 per year payable in accordance with MVB’s general payroll practices and is subject to future adjustment. Price is eligible to participate in MVB’s fringe benefit programs, including vacation, sick leave, group medical insurance, group life insurance, and expense reimbursement programs. In addition, Price is eligible to participate in the MVB annual executive performance incentive plan. Price is subject to MVB standard employee handbook policies. Price’s employment may be terminated for cause, terminated without cause, terminated due to death or permanent disability, or constructively terminated in the event of a change in control, all subject to certain conditions and
18
commitments, including, if termination without cause or constructive termination occurs, a severance payment of one year of the then current annual base salary, provided that a general release of claims is executed. Price’s employment agreement also includes provisions related to treatment of confidential information, the return of MVB’s property in the event of a resignation or termination, non-solicitation and non-interference, and non-competition. During the term of this agreement and for one year period following the effective date of the termination of this agreement (collectively, “Restricted Period”), Price will not, directly or indirectly, individually or as an employee, joint venture, partner, agent or independent contractor of any other person, provide or render services that are competitive with the services provided by Employee hereunder at any location within 50 miles of Employee’s primary office for 12 months in West Virginia and also within 50 miles of a place of business of MVB or any MVB subsidiary. Under this agreement which outlines severance payments based on years of service (employed less than five years = six months of employee’s salary; employed five years or more, twelve months of employee’s salary), if Mr. Price’s employment were terminated without cause as of December 31, 2016, he will be entitled to receive a lump sum of $117,500 from MVB under this agreement and all stock options would immediately vest.
Robinson has a written employment agreement with MVB, effective January 1, 2016. Robinson’s current salary is $350,000 per year payable in accordance with MVB’s general payroll practices and is subject to future adjustment. Robinson is eligible to participate in MVB’s fringe benefit programs, including vacation, sick leave, group medical insurance, group life insurance, and expense reimbursement programs. In addition, Robinson is eligible to participate in the MVB annual executive performance incentive plan. Robinson is subject to MVB standard employee handbook policies. Robinson’s employment may be terminated for cause, terminated without cause, terminated due to death or permanent disability, or constructively terminated in the event of a change in control, all subject to certain conditions and commitments, including, if termination without cause or constructive termination occurs, a severance payment of one year of the then current annual base salary, provided that a general release of claims is executed. Upon separation from the Company, Mr. Robinson would also be entitled to accrued, but unpaid, salary and benefits. Robinson’s employment agreement also includes provisions related to treatment of confidential information, the return of MVB’s property in the event of a resignation or termination, non-solicitation and non-interference, and non-competition. During the term of this agreement and for one yearone-year period following the effective date of the termination of this agreement, (collectively, “Restricted Period”), Robinson will not, directly or indirectly, individually or as an employee, joint venture, partner, agent, or independent contractor of any other person, provide or render services that are competitive with the services provided by Employee hereunderRobinson thereunder at any location within 50 miles of Employee’sRobinson's primary office. Under this agreement which outlines severance payments based on years of service (employed less than five years = six months of employee’s salary; employed five years or more, twelve months of employee’s salary), ifIf Mr. Robinson’s employment were terminated without cause as of December 31, 2016,2017, he will bewould have been entitled to receive a lump sum of $350,000 from MVB under this agreement and all stock options, totaling $1,610,250, would immediately vest.
19
Budget Reconciliation Act of 1985, as amended,COBRA plus an additional six months; and, entitled to other employee benefits through the remaining term of the agreement. All commissions which were earned as of the date of termination would be paid in no later than 30 days after the closing of the applicable loan.months. If employment terminates due to death or disability, Mr. Dean, or his estate, shall receive an amount equal to that amount shown on Mr. Dean’s Form W-2 for the previous fiscal year. If the agreement is terminated as a result of legal disability, Dean would be entitled to receive benefits under MVB’s long-term disability policy. The agreement also provides that, on termination without cause, or termination by Mr. Dean without good reason, as defined in the agreement, Dean will not compete with, or solicit customers or employees of MVB or PMG for a period of 18 months within the counties in which MVB, MVB Bank, and MVB Mortgage operate. Pursuant to the agreement, on December 31, 2012, MVB entered into an indemnification agreement with Dean, which provides for indemnification and advances in expenses and costs incurred by Dean in connection with claims, suits or proceedings arising as a result of his service with the Company, to the fullest extent permitted by law. If Mr. Dean’s employment were terminated without cause as of December 31, 2015,2017, he would be entitled to receive a lump sum of $2,112,160$1,623,763 from MVB and its subsidiaries under this agreement. In addition, MVB would pay COBRA premiums for the maximum period of continuation of insurance coverage provided under COBRA and pay the full cost for substantially equivalent health and dental insurance benefits for six months after such maximum continuation coverage period expires, as well as for dental insurance coverage, life insurance plan, and 401(k) plan and other benefits (except to the extent that any such benefits are duplicative of the health and dental insurance coverage) for the remaining term of the agreement. Further, all stock options, totaling $381,000, would immediately vest.
Cober has
The foregoing descriptions apply to agreements entered into by MVB with the Executive Officers named in the2017 Summary Compensation Table above, or “Named Executive Officers.” In addition to these employment agreements, MVB and the MVB Bank have entered into a number of employment agreements with other employees.
Table.
Director Name | 2017 Director Compensation | |||||||||||
Cash ($)1 | Options ($)2 | Total ($) | ||||||||||
David B. Alvarez | $ | 31,700 | $ | 3,200 | $ | 34,900 | ||||||
Stephen R. Brooks | $ | 101,952 | $ | 3,200 | $ | 105,152 | ||||||
James J. Cava, Jr. | $ | 76,244 | $ | 3,200 | $ | 79,444 | ||||||
John W. Ebert | $ | 45,000 | $ | 3,200 | $ | 48,200 | ||||||
Daniel W. Holt4 | $ | 600 | $ | — | $ | 600 | ||||||
Gary A. LeDonne | $ | 65,454 | $ | 3,200 | $ | 68,654 | ||||||
Dr. Kelly R. Nelson | $ | 56,250 | $ | 3,200 | $ | 59,450 | ||||||
J. Christopher Pallotta | $ | 55,169 | $ | 3,200 | $ | 58,369 | ||||||
Nitesh S. Patel3 | $ | 40,400 | $ | — | $ | 40,400 |
20
stock option awards granted to directors in 2015.
Director Name |
| 2015 Director Compensation |
| |||||||
|
| Cash |
|
| Options |
|
| Total |
| |
David B. Alvarez |
|
| 21,300 |
| $ | 2,580 |
| $ | 23,880 |
|
Stephen R. Brooks |
|
| 39,400 |
| $ | 2,580 |
| $ | 41,980 |
|
James J. Cava, Jr. |
|
| 34,750 |
| $ | 2,580 |
| $ | 37,330 |
|
Dr. Joseph P. Cincinnati |
|
| 13,775 |
| $ | 2,580 |
| $ | 16,355 |
|
John W. Ebert |
|
| 23,725 |
| $ | 2,580 |
| $ | 26,305 |
|
Gayle C. Manchin |
|
| 12,340 |
| $ | 2,580 |
| $ | 14,920 |
|
Dr. Kelly R. Nelson |
|
| 28,250 |
| $ | 2,580 |
| $ | 30,830 |
|
J. Christopher Pallotta |
|
| 28,500 |
| $ | 2,580 |
| $ | 31,080 |
|
Nitesh S. Patel |
|
| 27,247 |
| $ | 2,580 |
| $ | 29,827 |
|
Jimmy D. Staton |
|
| 30,775 |
| $ | 2,580 |
| $ | 33,355 |
|
* Roger J. Turner |
|
| 14,850 |
| $ | 2,580 |
| $ | 17,430 |
|
* Samuel J. Warash |
|
| 20,650 |
| $ | 2,580 |
| $ | 23,230 |
|
|
|
|
|
|
|
* Retiring Directors with expiring terms
Certain Transactions with Directors, Officers and Their Associates
All related-party transactions require approval from the Board of Directors of MVB.
As of March 28, 2016, there are no shareholders who currently beneficially own or have the right to acquire shares that would result in ownership of more than 5% of MVB’s common stock.
21
Ownership of Securities by Directors, Nominees and Executive Officers
|
|
|
|
|
|
|
| Shares of Stock |
| Percent of |
|
|
| (See notes 1,2&3) |
|
|
|
David B. Alvarez |
| 264,060 |
| 3.02 | % |
Stephen R. Brooks |
| 43,531 |
| 0.50 | % |
James J. Cava, Jr. |
| 90,892 |
| 1.04 | % |
Dr. Joseph P. Cincinnati |
| 84,052 |
| 0.96 | % |
H. Edward Dean |
| 209,544 |
| 2.40 | % |
John W. Ebert |
| 68,382 |
| 0.78 | % |
Gayle C. Manchin |
| 22,860 |
| 0.26 | % |
Larry F. Mazza |
| 324,455 |
| 3.71 | % |
Dr. Kelly R. Nelson |
| 59,656 |
| 0.68 | % |
J. Christopher Pallotta |
| 114,772 |
| 1.31 | % |
Nitesh S. Patel |
| 153,403 |
| 1.76 | % |
Jimmy D. Staton |
| 117,774 |
| 1.35 | % |
* Roger J. Turner |
| 101,181 |
| 1.16 | % |
* Samuel J. Warash |
| 53,138 |
| 0.61 | % |
Bret S. Price |
| 7,000 |
| 0.08 | % |
L. Randall Cober |
| 51,169 |
| 0.59 | % |
Donald T. Robinson |
| 66,870 |
| 0.77 | % |
Directors and Executive Officers as a group (17 people) |
| 1,832,782 |
| 20.98 | % |
Notes:
Shares of Stock Beneficially Owned 1, 2 | Percent of Ownership | |||||
David B. Alvarez | 481,234 | 4.49 | % | |||
Stephen R. Brooks | 44,638 | 0.42 | % | |||
James J. Cava, Jr. | 173,014 | 1.63 | % | |||
H. Edward Dean | 316,749 | 2.98 | % | |||
John W. Ebert | 77,343 | 0.73 | % | |||
Daniel W. Holt | 5,500 | 0.05 | % | |||
Gary A. LeDonne | 43,807 | 0.42 | % | |||
Larry F. Mazza | 563,498 | 5.20 | % | |||
Dr. Kelly R. Nelson | 66,052 | 0.63 | % | |||
J. Christopher Pallotta | 144,781 | 1.37 | % | |||
Donald T. Robinson | 134,221 | 1.26 | % | |||
David A. Jones | 72,679 | 0.69 | % | |||
John T. Schirripa | 107,515 | 1.01 | % | |||
Directors and Executive Officers as a group | 2,231,031 | 19.44 | % |
| ||||
Name and Address of Beneficial | Number of | Percent of Class | ||
Cline Trust Company, LLC 3801 PGA Blvd #901 Palm Beach Gardens, FL 33410 | 625,0001 | 5.60%2 |
|
|
|
|
* Retiring Directors
22
2.NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION
3.APPROVAL OF THE ANNUAL EXECUTIVE PERFORMANCE INCENTIVE PLAN
Overview and Purpose of Plan
The Human Resources & Compensation Committee of the Board of Directors adopted an Annual Executive Performance Incentive Plan (the “Plan”). The Plan was approved by MVB’s shareholders at the 2015 annual meeting. The Plan is intended to provide incentives to certain executives to attain the goals of MVB and to provide those executives with incentive compensation based on the performance of MVB. The Plan is also designed to align those executives’ incentive compensation with shareholder value. The Human Resources & Compensation Committee has amended the Plan to clarify the method of determining the amount available to the Plan each year. A copy of the Plan, as amended, is attached as Exhibit C to this Proxy Statement.
Amendment to the Plan
The Plan has been amended to reflect the calculation of the amount available to the Plan by including the following calculation: Each year, the Human Resources & Compensation committee will establish a targeted net income for MVB. Once actual net income for MVB has been determined and finalized for the year, 40% of the excess of actual net income over target net income will be available for awards under the Plan. There are three groups within the Plan: Senior Executives (9 participants), Junior Executives (11 participants) and the Corporate group (84 participants). Seventy percent of the amount available under the Plan will be allocated to the Senior Executives and Junior Executives, and 30% will be allocated to all other employees. While this calculation was intended to be used in the plan, it was not formally addressed in the Plan until the amendment. Otherwise, the Plan remains unchanged from the Plan which was approved by the shareholders in 2015. At the 2016 annual meeting of shareholders, MVB is seeking shareholder approval of the Plan, as amended.
23
Limitations on the Deductibility of Compensation
Pursuant to Section 162(m) of the IRC, a portion of annual compensation payable to any of MVB’s five highest paid executive officers may not be deductible by MVB for federal income tax purposes to the extent such officer’s overall compensation exceeds $1,000,000. The Plan has been designed to meet the performance-based exception to the $1,000,000 limitation of deductible executive compensation under IRC § 162(m). The Board of Directors has determined that it is in the best interest of MVB and its shareholders to seek shareholder approval of the Plan in view of the tax provisions contained in IRC § 162(m). To qualify for the performance-based exception to Section 162(m), the specific terms of the performance-based compensation awarded to the executives must be disclosed to and approved by the shareholders of MVB. Your approval of the Plan, as amended, is sought in order that awards granted under the Plan would not count towards the $1,000,000 deductible compensation limit under Section 162(m).
How the Plan Works
The Human Resources & Compensation Committee administers the Plan. The Committee is made up entirely of outside, independent directors and determines the recipients and amount of awards under the Plan. The Committee also has the authority to interpret the Plan and make all determinations under the Plan.
Subject to final approval by MVB’s Board of Directors, the Chief Executive Officer of MVB recommends the executives who will be eligible for the Plan. The Chief Executive Officer is eligible to participate in the Plan.
All payments under the Plan are based on attainment of certain performance measures established within the first 90 days of a performance cycle by the Human Resources & Compensation Committee for the Chief Executive Officer and by the Chief Executive Officer for other participants. Key performance measures will be established which are based on objective criteria, which may apply to the individual executive. No payments will be made under the Plan, unless MVB exceeds its annually established net income goal.
MVB’s net income for the year will be the basis for determining the overall incentive payout levels based on the following scale:
|
|
Performance Level Against Net Income Goal | Payout as Percent (%) of Opportunity |
100% | 0% |
125% | 25% |
150% | 50% |
200% | 100% |
The net income goal for any calendar year may be adjusted by the Committee to reflect extraordinary events or circumstances affecting MVB or its business, which would render the goal unattainable.
A set of performance measurements, beyond the net income goal, are used in the Plan. The final performance metric and its targeted value for the given year Plan are found on the Plan Matrix, as defined in the 2016 Annual Executive Performance Incentive Plan attached hereto as Exhibit C. Each Named Executive Officer has a series of selected performance metrics designated as part of his or her performance criteria to reach or exceed during the Plan year. For each such performance metric, a weight will be assigned to equal 100% across the total metrics determined for the Named Executive. The following are the prime performance metrics deployed in the Plan Matrix (subject to change from year to year):
|
|
|
|
|
24
Four incentive percentage split tiers will be used based upon job position levels within MVB. The Plan Matrix will indicate the designated tier for each Named Executive. The tier weighting ratios will be used in calculating the incentive payouts as follows:
|
|
| |
| |
| |
|
*Subject to additional Plan guidelines.
Benefits and amounts available under the Plan are not currently determinable.
The Plan specifies the maximum amounts that may be paid under the Plan. The maximum payment that may be made to any one participant for any fiscal year of MVB is $1,000,000.
After expiration of a fiscal year or performance period, as applicable, the Committee will certify if the performance measures have been attained and, if so, each executive who is employed by MVB on the last day of the applicable period will be entitled to a payment under the Plan in a predetermined amount, as established by the Committee.
In the event MVB restates its financial results within 12 months of the payment of an award due to material noncompliance with any financial reporting requirements of the federal securities laws as a result of an executive’s intentional “misconduct” (as determined by the members of the MVB Human Resources & Compensation Committee), the executive must reimburse MVB the difference between the amount of the award actually awarded and the amount of the award such an executive officer would have received had the amount of the award been calculated based on the restated financial statements.
The altering, inflating, and/or inappropriate manipulation of performance/financial results or any other infraction of recognized ethical business standards will subject the executive to disciplinary action up to and including termination of employment. In addition, any award as provided by the Plan to which the executive would otherwise be entitled will be revoked. An executive who has willfully engaged in any activity injurious to MVB will forfeit any award earned during the award period in which the activity occurred.
The Human Resources & Compensation Committee may at any time amend the Plan.
Federal Income Tax Consequences of the Plan
If MVB complies with the performance-based exception to the $1,000,000 limitation on deductible executive compensation, payments under the Plan will be deductible by MVB for federal income tax purposes. Cash payments to participants under the plan will generally be taxable to the employee as ordinary income in the year payment is made to the employee.
The Board of Directors recommends that you vote “FOR” the adoption of the Annual Executive Performance Incentive Plan, as amended.
The enclosed proxy will be voted “FOR”"FOR" the Annual Executive Performance Incentive Plan, as amended,approval of executive compensation, unless otherwise directed. The affirmative vote of a majority of the shares of Common Stock present at the meeting is required to adopt Annual Executive Performance Incentive Plan, as amended.
25
4.3. RATIFICATION OF INDEPENDENT REGISTERED ACCOUNTING FIRM
2015.
|
|
|
|
|
|
|
|
|
| ||
| 2015 |
| 2014 |
| 2013 |
| |||||
Audit Fees(1) | $ | 179,400 |
| $ | 156,000 |
| $ | 123,225 |
| ||
Audit-Related Fees |
| 25,550 |
|
| 61,112 |
|
| - |
| ||
Tax Fees |
|
|
|
| - |
|
| - |
| ||
All Other Fees |
| 28,500 |
|
| - |
|
| - |
| ||
| $ | 233,450 |
| $ | 217,112 |
| $ | 123,225 |
|
|
|
2017 | 2016 | 2015 | ||||||||
Audit Fees 1 | $ | 183,800 | $ | 201,700 | $ | 179,400 | ||||
Audit-Related Fees | 10,092 | 22,931 | 25,550 | |||||||
Tax Fees | 38,975 | — | — | |||||||
All Other Fees | 9,100 | 147,490 | 28,500 | |||||||
$ | 241,967 | $ | 372,121 | $ | 233,450 |
2015.
5.2018.
26
Form 10-K Annual Report –
2018 Annual Meeting website:
www.investorvote.com/MVBFwith.
21, 2019.
![]() | ||
Larry F. Mazza | ||
President |
27
EXHIBIT A
AUDIT COMMITTEE CHARTER
1. | Purpose |
2. | General Responsibilities of the Committee |
a. | Oversight of Independent, External |
i. Select, engage, compensate, oversee and, where appropriate, replace the independent registered public accounting firm (“Auditor”), subject to any required Board and shareholder approvals. The Auditor shall not provide any services unless approved by the Committee. The Committee shall require that the Auditor issue a written report of such audit directly to the Committee;
ii. Discuss with the Auditor the overall scope and plans for the audit including the adequacy of staffing and compensation and submit to management the audit, non-audit, administrative and other fees to be paid by management on behalf of the Committee;
iii. Ascertain that both the lead and the concurring audit partners are restricted to a maximum of five consecutive years of serving in either capacity. In addition, the Committee shall ascertain that after the initial service period, both the lead and concurring partners not perform any audit services in either capacity for a minimum of five consecutive years. The Committee should also ascertain that after the initial service period, the lead partner does not step down into an engagement quality review role that would cause the lead partner to review his or her own work. Finally, the Committee shall ascertain that any partner other than the lead or concurring partner serves no more than seven consecutive years at the partner level on the MVB’s audit;
iv. Review (with management and the Auditor) the Auditor’s assessment of the adequacy of internal controls and the resolution of identified material weaknesses and reportable conditions, including the prevention or detection of management override or compromise of the internal control system. Further, the Committee shall meet separately as deemed necessary with the Auditor, without management present, to discuss the results of its examinations, or for any other reason the Committee deems necessary;
v. Work with management and the Auditor to monitor the MVB’s compliance with laws and regulations;
vi. Resolve any significant disagreements between the Auditor and management;
vii. Receive and review communications submitted by the Auditors and regulators and take appropriate actions;
viii. Require receipt from the Auditors of a formal written statement delineating all relationships between the Auditors and MVB, consistent with Independence Standards Board Standard 1, and the Committee’s responsibility for actively engaging in a dialogue with the Auditor with respect to any disclosed relationships or services that may impact the objectivity and independence of the Auditor and for taking, or recommending that the full board take, appropriate action to oversee the independence of the outside Auditor;
ix. Review the results of the annual audit, the audited financial statements included in the Form 10-K and discuss the results of the audit and any other matters required to be communicated to the Committee by
A-1
the Auditor under generally accepted auditing standards, including any comments or recommendations of the Auditor;
x. Receive affirmative acknowledgement from the Auditor that it is accountable only to the Committee;
xi. Require that the Auditor review the Company’s interim financial statements prior to filing the quarterly report on Form 10-Q. Also, the Committee shall discuss the results of the quarterly review and any other matters required to be communicated to the Committee by the Auditor under generally accepted auditing standards. The chair of the Committee may represent the entire Committee for purpose of this review; and,
xii. Conduct executive sessions with the outside auditors without the presence of Management as deemed necessary, but no less than annually.
| |
i. | Select, engage, compensate, oversee and, where appropriate, replace the independent registered public accounting firm (“Auditor”), subject to any required Board and shareholder approvals. The Auditor shall not provide any services unless approved by the Committee. The Committee shall require that the Auditor issue a written report of such audit directly to the Committee; |
ii. | Discuss with the Auditor the overall scope and plans for the audit including the adequacy of staffing and compensation and submit to management the audit, non-audit, administrative and other fees to be paid by management on behalf of the Committee; |
iii. | Ascertain that both the lead and the concurring audit partners are restricted to a maximum of five consecutive years of serving in either capacity. In addition, the Committee shall ascertain that after the initial service period, both the lead and concurring partners not perform any audit services in either capacity for a minimum of five consecutive years. The Committee should also ascertain that after the initial service period, the lead partner does not step down into an engagement quality review role that would cause the lead partner to review his or her own work. Finally, the Committee shall ascertain that any partner other than the lead or concurring partner serves no more than seven consecutive years at the partner level on the MVB’s audit; |
iv. | Review (with management and the Auditor) the Auditor’s assessment of the adequacy of internal controls and the resolution of identified material weaknesses and reportable conditions, including the prevention or detection of management override or compromise of the internal control system. Further, the Committee shall meet separately as deemed necessary with the Auditor, without management present, to discuss the results of its examinations, or for any other reason the Committee deems necessary; |
v. | Work with management and the Auditor to monitor the MVB’s compliance with laws and regulations; |
vi. | Resolve any significant disagreements between the Auditor and management; |
vii. | Receive and review communications submitted by the Auditors and regulators and take appropriate actions; |
viii. | Require receipt from the Auditors of a formal written statement delineating all relationships between the Auditors and MVB, consistent with Independence Standards Board Standard 1, and the Committee’s responsibility for actively engaging in a dialogue with the Auditor with respect to any disclosed relationships or services that may impact the objectivity and independence of the Auditor and for taking, or recommending that the full board take, appropriate action to oversee the independence of the outside Auditor; |
ix. | Review the results of the annual audit, the audited financial statements included in the Form 10-K and discuss the results of the audit and any other matters required to be communicated to the Committee by the Auditor under generally accepted auditing standards, including any comments or recommendations of the Auditor; |
x. | Receive affirmative acknowledgement from the Auditor that it is accountable only to the Committee; |
xi. | Require that the Auditor review the Company’s interim financial statements prior to filing the quarterly report on Form 10-Q. Also, the Committee shall discuss the results of the quarterly review and any other matters required to be communicated to the Committee by the Auditor under generally accepted auditing standards. The chair of the Committee may represent the entire Committee for purpose of this review; and, |
xii. | Conduct executive sessions with the outside auditors without the presence of Management as deemed necessary, but no less than annually. |
b. | Oversight of Internal Audit. With regard to internal audit activities, the Committee shall: |
i. Engage an independent certified public accountant or other qualified vendor(s) to perform routine internal audits on major risk areas;
ii. Review and approve the scope, effectiveness and results of the MVB’s internal audit function;
iii. Review communications submitted by the internal auditor and take appropriate actions; and,
iv. Review incidents of internal fraud to determine their impact in relation to the financial reporting process and the overall systems of internal control.
| |
i. | Engage an independent certified public accountant or other qualified vendor(s) to perform routine internal audits on major risk areas; |
ii. | Review and approve the scope, effectiveness, and results of the MVB’s internal audit function; |
iii. | Review communications submitted by the internal auditor and take appropriate actions; and, |
iv. | Review incidents of internal fraud to determine their impact in relation to the financial reporting process and the overall systems of internal control. |
c. | Oversight of Enterprise Risk Management Activities. With regard to enterprise risk management activities, the Committee shall: |
i. | Review the work of the MVB Risk Oversight Committee and the Chief Risk Officer to ensure that the MVB Financial Board is well-versed on risk issues and has the opportunity to question and provide guidance on day-to-day and long-term MVB risk management activities. |
ii. | Review significant financial and other risk exposures and the steps management has taken to monitor, control and report such exposures, including, without limitation, credit, market, fiduciary, liquidity, reputational, operational, fraud, strategic, technology, (data-security business-continuity risk, etc.) and risks associated with incentive compensation plans. |
iii. | Approve and periodically review, at least annually, MVB’s enterprise risk management program. |
iv. | Discuss with management and the CRO, MVB’s major risk exposures and review how management has monitored, mitigated, and controlled such exposures, including MVB’s risk assessment and risk management policies and practices. |
v. | Assist develop, approve, and keep current MVB’s risk appetite statement and associated identified risk tolerance levels on an annual basis or as circumstances warrant. |
vi. | Work in coordination with other MVB Financial Board committees and subcommittees that engage in risk management functions to ensure that there is comprehensive, coordinated enterprise risk management for MVB. |
d. | Loan Review and Asset Quality Matters.With regard to loan review and asset quality matters, the Committee shall: |
i. Engage a qualified vendor to perform a periodic review of MVB’s loan portfolio to assess the quality of the MVB’s underwriting, approval function, loan documentation, account management and risk identification processes;
ii. Review and approve the scope, effectiveness, and results of the MVB’s loan review function; and,
iii. Review communications submitted by the outside vendor and take appropriate actions.
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i. | Engage a qualified vendor to perform a periodic review of MVB’s loan portfolio to assess the quality of the MVB’s underwriting, approval function, loan documentation, account management and risk identification processes; |
ii. | Review and approve the scope, effectiveness, and results of the MVB’s loan review function; and, |
iii. | Review communications submitted by the outside vendor and take appropriate actions. |
e. | Oversight of Compliance and Whistleblower Matters. With regard to compliance, whistleblower and other ethics matters, the Committee shall: |
i. Ensure an effective whistleblower policy is in place and kept current to include assuring all employees and others, as applicable, are aware of the whistleblower policy and understand its purpose and process for use;
ii. Review, process and retain any complaints or other communications received by MVB’s Chief Legal and Risk Officer, MVB’s Chief Compliance Officer, an employee of MVB or the independent external auditor regarding accounting, internal accounting controls or auditing matters;
iii. Review, process and retain confidential, anonymous submissions – made through MVB’s third party ethics hotline or otherwise – by employees of MVB regarding questionable internal control, accounting or auditing matters;
iv. Cause an investigation to be made into any matter brought to its attention that is within the scope of its duties, with the power to retain independent outside counsel or other professionals for this purpose if, in its judgment, that is appropriate; and,
v. Engage independent counsel, or other advisors or experts, as it determines necessary in the performance of its duties.
i. Ensure an effective whistleblower policy is in place and kept current to include assuring all employees and others, as applicable, are aware of the whistleblower policy and understand its purpose and process for use; ii. Review, process and retain any complaints or other communications received by MVB’s Chief Credit and Risk Officer, MVB’s Chief Compliance Officer, an employee of MVB or the independent external auditor regarding accounting, internal accounting controls or auditing matters; iii. Review, process and retain confidential, anonymous submissions - made through MVB’s third party ethics hotline or otherwise - by employees of MVB regarding questionable internal control, accounting or auditing matters; iv. Cause an investigation to be made into any matter brought to its attention that is within the scope of its duties, with the power to retain independent outside counsel or other professionals for this purpose if, in its judgment, that is appropriate; and, v. Engage independent counsel, or other advisors or experts, as it determines necessary in the performance of its duties. ,mortgage,mortgage, insurance, broker-dealer and investment advisory laws and regulations to include reviewing the effectiveness of the system for monitoring compliance and laws and regulations and the results of management’s investigation and follow-up (including disciplinary action) of any instances of noncompliance. Among other regulations, specifically, the Committee shallprovide oversight for key banking regulations, including MVB’s compliance with Bank Secrecy Act (the “BSA”) and adherence to the Insider Borrowing Policy with all borrowings.e.f. DirectorsDirectors.. The Reports of meetings of the Committee shall be made to the Board at its next regularly scheduled meeting following the Committee meeting accompanied by any recommendations to the Board approved by the Committee. In addition, the Committee shall provide at least one written report annually to the Board of Directors describing the Committee’s::
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i. Historical and planned activities for carrying out the Committee’s duties and responsibilities.
ii. Appraisal of the financial reporting processes and systems of internal accounting controls.
iii. Recommendations regarding the engagement of the Auditor.
iv. Assessment of the adequacy of the Committee Charter.
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i. | Historical and planned activities for carrying out the Committee’s duties and responsibilities. |
ii. | Appraisal of the financial reporting processes and systems of internal accounting controls. |
iii. | Recommendations regarding the engagement of the Auditor. |
iv. | Assessment of the adequacy of the Committee Charter. |
g. | Maintain Standard Operating Procedures. The Committee shall maintain standard operating procedures for documenting the activities employed by the Audit Committee during the discharge of its duties and responsibilities. |
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h. | Oversee Proxy Report. The Committee shall oversee the preparation of the report for enclosure in the MVB proxy statement that discloses that the Committee has or has not recommended that MVB’s audited financial statement be filed with the appropriate regulatory authorities as well as appropriate oversight conclusions. |
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i. | Audit Committee Support |
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j. | Review Related Party Transactions. To review, approve and oversee any transaction between MVB and any related person (as defined in Item 404 of Regulation S-K) and any other potential conflict of interest situations on an ongoing basis, in accordance with MVB policies and procedures. |
k. | Other Responsibilities.In performing its functions, undertake those tasks and responsibilities that, in its judgment, would contribute most effectively to and implement the purposes of the Audit Committee. |
3. | Membership |
a. | Composition of the Committee.The Committee shall consist of no fewer than three |
i. The member of the Board has been employed by MVB during the current year or any of the past three years;
ii. The member of the Board is a member of the immediate family of an individual who is, or has been in any of the past three years, employed by the Bank as an executive officer;
iii. The member of the Board is a partner in or a controlling shareholder or an executive officer of any organization to which MVB made or from which MVB received payments (other than those arising from investments in the MVB’s securities or under non-discretionary charitable contributions matching programs) from property or services that exceed 5% of the MVB’s consolidated gross revenues for that year, or $200,000, whichever is more, in any of the past three years;
iv. The member of the Board is employed as an executive of another entity where any of MVB’s executives serve on that entity’s compensation committee;
v. The member of the Board is or has an immediate family member who is a current partner of the MVB’s outside auditor, or who was a partner or employee of the MVB’s outside auditor who worked on the MVB’s audit at any time during any of the past three years;
vi. The member of the Board is an accountant, attorney, investment banker or financial advisor who provides fee bases services to MVB.
Also, to be considered independent, a member of the Committee may not, other than in his or her capacity as a member of the Committee, the board of directors, or any other board committee, accept directly or indirectly any consulting, advisory, or other compensatory fee from MVB, provided that, compensatory fees do not include the receipt of fixed amounts of compensation under a retirement plan (including deferred compensation) for prior service with MVB (provided that such compensation is not contingent in any way on continued service); or be an affiliated person of MVB.
background that rises to the level of such financial sophistication, including being or having been a chief executive officer, chief financial officer, or other senior officer with financial oversight responsibilities, S-K. Meetings, Minutes and Voting Reports Advisors and Counsel; Cooperation and Reliance Evaluation of the Committee Scope of Charter. Whether this Charter appropriately addresses the matters that are or should be within its scope. Quality of Committee Work. The adequacy, appropriateness and quality of the information and recommendations presented by the Committee to the Board. Participation of Members and Quality of Decision Process. The manner in which they were discussed or debated, whether all members actively participated and contributed to the work of the Committee. Length and Number of Meetings. Whether the number and length of meetings of the Committee were adequate for the Committee to complete its work in a thorough and thoughtful manner. Other Appropriate Factors. Such other factors as the Committee deems relevant to the completion of its responsibilities under this Charter. Rules and Procedures Limitation on Responsibility Annual Review of Charter EXHIBIT B Purpose Responsibilities of the Committee Membership Meetings, Minutes, and Voting Report Advisors and Counsel; Cooperation and Reliance Evaluation of the Committee Rules and Procedures Limitation on Responsibility Annual Review of Charter Performance Level Against Net Income Goal Payout as Percent (%) of Target Incentive Opportunity 100% 0% 125% 25% 150% 50% 200% 100%A-3401(e)407(d)(5)(ii) of Regulation S-B.Moreover, the members of the Committee shall meet the requirements of MVB Governance Guidelines and such other rules and regulations as may be appropriate.b. c. d. e. 4. a. b. c. d. e. f. 5. 6. a. A-4b. c. d. 7. a. b. c. d. e. 8. 9. 10. A-5GOVERNANCE COMMITTEE CHARTER1. 2. Responsibilities of the Committee a. b. c. d. e. f. g. h. i. j. k. l. m. n. o. p. q. r. s. t. u. v. 3. Membership a. b. c. d. e. 4. Meetings, Minutes, and Voting a. b. c. d. e. f. 5. Report 6. Advisors and Counsel; Cooperation and Reliance a. b. c. d. 7. Evaluation of the Committee a. b. c. d. e. 8. Rules and Procedures 9. Limitation on Responsibility 10. Annual Review of Charter 1. Purpose (4)(5) by leading MVB in periodic assessments of the operation of MVB boards and committees and the contributions of the members, and (5)(6) by monitoring of the implementation of MVB governance policies and practices.2. a. GuidelinesGuidelines.. Work with the Board and MVB management in developing MVB’s governance guidelines to include a periodic review process of the governance guidelines to ensure the accountability and effectiveness of MVB Boards, taking into account changes in the relevant laws and current trends in governance practices.b. PracticesPractices.. Oversee the general company matters and practices of MVB, including recommendations of amendments to respective certificate or articles of incorporation and Bylaws, annual stockholder meeting matters (including review of any stockholder proposals), recommendations of amendments to MVB’s change in control plan, review of MVB’s Code of Conduct, Corporate Conduct Policy, Conflict of Interest and other internal policies as the Committee deems appropriate.c. d. e. f. g. h. i. j. k. B-1l. m. n. o. 3. b. c. d. e. 4. a. b. c. d. e. f. 5. 6. a. B-2b. c. d. 7. a. b. c. d. e. 8. 9. 10. B-3EXHIBIT C2016 ANNUAL EXECUTIVE PERFORMANCE INCENTIVE PLANGuidelines for Annual Awards1.PurposeThe purpose of the Annual Executive Performance Incentive Plan (the “Plan”) for MVB Financial Corp. (“MVB”) is to promote the interests of MVB and its shareholders by:a.attracting and retaining executives of outstanding ability;b.incentivizing such individuals, by means of performance-related goals; andc.enabling such individuals to participate in the growth and financial success of MVB.2.Plan ScopeThese Guidelines cover the Plan only and do not address other compensation, benefits or other incentive plans in place at MVB. The Plan is administered on an annual basis corresponding to MVB’s fiscal year (January-December). At the start of each year, an updated Plan shall be submitted to MVB’s Board of Directors for approval by its Human Resources and Compensation Committee (“Committee”). The Plan is overseen and monitored by MVB’s Human Resources Department.3. Plan Participation EligibilityOn an annual basis, the CEO recommends the Executives who will be eligible for the Plan (“Named Executives”), subject to final approval by MVB’s Board of Directors. Once the annual Plan is approved, each Named Executive will receive written notification and a copy of the given year’s Plan reflecting his or her requirements and potential incentive payout levels. The CEO is eligible to participate in the plan.MVB Team Members who participate in a commission-based incentive plan (Mortgage Loan Officers/Mortgage Loan Manager) or any other MVB incentive plan (other than the MVB Financial Corp. 2015 Stock Incentive Plan), will not be eligible for this Plan. 4. Plan DesignThe Plan has been designed using industry best practices aligned with MVB’s strategic planning and performance benchmark targets. There are several components to the design with different criteria and weightings applied to ensure the Plan is stringent yet achievable and that it is an effective incentive to garner high performance in all areas of MVB operations.a.Annual Executive Incentive Plan Performance Requirements and Payout MatrixAs part of the annual review and approval of the Plan, the CEO will provide the Committee with detailed Performance Requirements and a Payout Matrix (“Plan Matrix”) which establishes for each Named Executive the given year’s performance measurements and associated weightings used to determine individual incentive compensation payouts. The Committee shall annually establish similar detailed Performance Requirements and a Plan Matrix for the CEO.In addition, the Plan Matrix will reflect the payout ratios based on actual performance targets and percentage breakdowns (weights) regarding the Named Executive’s portion of potential incentive which comes from overall company performance metrics and, if applicable, from the individual’s annual personal performance evaluation.The Plan Guidelines or the Plan Matrix, once approved, cannot be changed or modified by a verbal communication or course of dealing, but only by a written communication signed by the Committee Chairman; provided, however, that the Plan Guidelines or Plan Matrix cannot be amended with respect to qualified performance-based compensation governed by Section 4(h) hereof unless such amendment complies with said Section 4(h).b.Key Criteria for Incentive Payout ActivationThe following are set criteria that must be met fully or no incentive payout is made:C-1By MVB – No payout to any Named Executive will be made unless MVB’s annually established Net Income goal target is met or exceeded.By the Individual – No payout to a Named Executive will be made unless these two requirements are met:·Receive a “3- Meets Expectations” rating (on a 1 to 5 scale) on her or his personal performance plan (3P) for the Plan year, AND·Complete his or her established education plan for the given year.c.Net Income Incentive Percentages and Targeted RequirementsMVB’s net income for the year will be the basis for determining the overall incentive payout levels based on the following scale:The applicable percentage will be indicated in the Plan Matrix to be reviewed and recommended by the Committee with final approval by the MVB Board of Directors and be calculated on a prorated basis. The following provisions govern how the net income goal is established and used:i. The net income target value will be established as part of the annual strategic planning and performance benchmark activity. The MVB Board of Directors gives final approval to the pending year’s net income goal, which becomes the net income target goal for the Plan.ii. The net income goal for the calendar year may be further adjusted to reflect extraordinary events or circumstances affecting MVB or its business, which render such a goal unattainable. iii. As shown in the above table, reaching 100% or falling short of the net income goal will result in no incentive payout for any Named Executive.d.Plan Governance & AuthorizationThe following provisions cover how the Plan and Plan Matrix will be governed and implemented:i. MVB Board of Directors may, at their sole discretion, waive, change or amend the Plan and the as it deems appropriate; provided, however, that the Committee shall have the sole discretion to amend this Plan with respect to “performance-based compensation” under Section 4(h) hereof, and no amendment of the Plan with respect to performance-based compensation shall be effective until approved by the shareholders of MVB.ii. The Committee, working on behalf of the MVB Board of Directors, will clarify, interpret and resolve any ambiguity as to the meaning of any terms or provisions of this Plan or annual Plan Matrix or any questions as to the correct interpretation of any information contained therein, all of which will be final and binding.iii. By participating in the Plan under these Guidelines, each Named Executive agrees that such decisions, rulings and interpretations will be final and that each Named Executive will be bound by them. Each Named Executive further agrees that if and when any circumstances arise relating to these Guidelines which are not covered by this description of the Plan, the Named Executive will be bound by the recommended decision, ruling or interpretation of the Committee.iv. Payment of any cash incentive under these Guidelines to any Named Executive covered is conditioned upon the written certification of the Committee that the performance goals and any other material conditions applicable to such award were satisfied.C-2v. Once the annual net income has been determined and finalized for the year, the gain share (or the difference between actual net income and target net income established by the Committee) will be split as follows:60% of gain share retained by MVB, and40% of gain share set aside to fund MVB’s 3 performance incentive plans (Sr. Executive,Jr. Executive, and Corporate).This 40% portion will be divided as follows among the 3 performance incentive plans:70% to the Sr. Executive and Jr. Executive Plans30% to the Corporate Plan.vi. The Committee will retain the discretion to decrease, but not increase, the amount of any cash incentive otherwise payable to any Named Executive in accordance with the applicable performance formula described above.e.Performance Benchmarks Development & UseA set of performance measurements, beyond the net income goal, will be used in the Plan. The final performance metric and its targeted value for the given year Plan will be found on the Plan Matrix. Each Named Executive will have a series of selected performance metrics designated as part of his or her performance criteria to reach or exceed during the Plan year. For each such performance metric, a weight will be assigned to equal 100% across the total metrics determined for the Named Executive. The following are the prime performance metrics deployed in the Plan Matrix (subject to change from year to year):Net IncomeCore Deposits (Net Growth)Efficiency RatioNet Interest MarginLoan Concentrationf.Allocation of Performance Payout Weights between Performance Metrics and Personal PerformanceFour incentive percentage split tiers will be used based upon job position levels within MVB. The Plan Matrix will indicate the designated tier for each Named Executive. The tier weighting ratios will be used in calculating the incentive payouts as follows:Incentive TierPerformance Metric(PM)/Personal Performance (PP)Weighting160% PM - 40% PP280% PM - 20% PP390% PM - 10% PP4100% PM Bank**Subject to additional Plan guidelines set forth below.g.Payment and Tax ConsiderationsThe following are considerations regarding payment and associated taxes based on the Plan design:i. Awards will be paid in a separate payroll before the end of the first quarter following the Plan Year or as soon as possible after the annual audit or certification of the year-end financial statement is complete. ii. All award payments under these Guidelines are considered supplemental pay and will be taxed as such. Appropriate withholding and deductions will be taken from such payments. Percentages will be rounded to the nearest 1/10 of a percent (for example, 10.3%) and the total amount of award will be rounded up to the nearest whole dollar.C-3iii. The amount of a Named Executive’s earnings for the calendar year which have actually been paid to the Named Executive will be used in determining the amount of incentive payout calculation. This calculation excludes the salary elements for any award payments issued during the calendar year.h.Qualified Performance-Based Awardsi. This Section 4(h) is intended to qualify any compensation paid under the Plan to Covered Employees (as hereinafter defined) as “qualified performance-based compensation” within the meaning of Treasury Regulation section 1.162-27(e)(1). Accordingly, the provisions of this Section 4(h) shall apply to awards made under this Plan to Covered Employees, notwithstanding any provision or term of this Plan to the contrary, and with respect to Covered Employees, any provision hereof that conflicts with this Section 4(h) shall be null and void and of no force and effect when applied to such persons. To the extent that the provisions of this Plan do not conflict with this Section 4(h), they will govern the treatment of awards under this Plan, including with respect to Covered Employees.ii. For purposes of Section 4(h), the following definitions shall apply:a.Covered Employee. The term “Covered Employee” means an employee of MVB who is a “Covered Employee” within the meaning of Section 162(m) of the Code.b.Performance-Based Award. The term “Performance-Based Award” means any award granted pursuant to this Plan that is granted to a Covered Employee that is intended to qualify as “performance-based compensation” under Section 162(m) of the Code and the regulations promulgated thereunderc.Performance Criteria. The term “Performance Criteria” means the criteria that the Committee selects for purposes of establishing the Performance Goal or Performance Goals for an individual for a Performance Cycle. The Performance Criteria (which shall be applicable to the organizational level specified by the Committee, including, but not limited to, the MVB or a unit, division, group, or Subsidiary of MVB) that will be used to establish Performance Goals are limited to the following: total shareholder return, earnings before interest, taxes, depreciation and amortization, net income (loss) (either before or after interest, taxes, depreciation and/or amortization), changes in the market price of the stock of MVB, economic value-added, funds from operations or similar measure, sales or revenue, acquisitions or strategic transactions, operating income (loss), cash flow (including, but not limited to, operating cash flow and free cash flow), return on capital, assets, equity, or investment, return on sales, gross or net profit levels, productivity, expense, margins, operating efficiency, customer satisfaction, working capital, earnings (loss) per share of stock of MVB, sales or market shares and number of customers, any of which may be measured either in absolute terms or as compared to any incremental increase or as compared to results of a peer group. The Committee may appropriately adjust any evaluation performance under a Performance Criterion to exclude any of the following events that occurs during a Performance Cycle: (i) asset write-downs or impairments, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reporting results, (iv) accruals for reorganizations and restructuring programs, (v) any extraordinary non-recurring items, including those described in the Financial Accounting Standards Board’s authoritative guidance and/or in management’s discussion and analysis of financial condition of operations appearing MVB’s annual report to stockholders for the applicable year, and (vi) any other extraordinary items adjusted from MVB’s U.S. GAAP results.d.Performance Cycle. The term “Performance Cycle” means one or more periods of time, which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Criteria will be measured for the purpose of determining a grantee’s right to and the payment of an award, the vesting and/or payment of which is subject to the attainment of one or more Performance Goals. Each such period shall not be less than twelve (12) months.e.Performance Goals. The term “Performance Goals” means, for a Performance Cycle, the specific goals established in writing by the Committee for a Performance Cycle based upon the Performance Criteria.iii. Before becoming effective, this Plan shall be approved by the shareholders of MVB.C-4iv. The Committee shall designate any award payable to a Covered Employee under this Plan as a Performance-Based Award, provided that said Performance-Based Award shall be payable only upon the attainment of Performance Goals that are established by the Committee and related to one or more of the Performance Criteria, in each case on a specified date or dates or over any period or periods determined by the Committee. The Committee shall define in an objective fashion the manner of calculating the Performance Criteria it selects to use for any Performance Cycle. Depending on the Performance Criteria used to establish such Performance Goals, the Performance Goals may be expressed in terms of the overall performance of MVB or the performance of a division, business unit, or an individual. Each Performance-Based Award shall comply with the provisions set forth below. The Committee may use the performance benchmarks and Plan Matrix of Sections 4(c), (e), and (f) of the Plan, provided that the use of such performance benchmarks and Plan Matrix complies with the provisions of this Section 4(h).v. With respect to each Performance-Based Award granted to a Covered Employee, the Committee shall select, within the first ninety (90) days of a Performance Cycle (or, if shorter, within the maximum period allowed under Section 162(m) of the Code) the Performance Criteria for such grant, and the Performance Goals with respect to each Performance Criterion (including a threshold level of performance below which no amount will become payable with respect to such Performance-Based Award). Each Performance-Based Award will specify the amount payable, or the formula for determining the amount payable, upon achievement of the various applicable performance targets. The Performance Criteria established by the Committee may be (but need not be) different for each Performance Cycle and different Performance Goals may be applicable to Performance-Based Awards to different Covered Employees.vi. Following the completion of a Performance Cycle, the Committee shall meet to review and certify in writing whether, and to what extent, the Performance Goals for the Performance Cycle have been achieved and, if so, to also calculate and certify in writing the amount of the Performance-Based Awards earned for the Performance Cycle for each Covered Employee.vii. Notwithstanding any statement or provision in this Plan to the contrary, and irrespective of what amount of incentive compensation the formulas and provisions of this Plan would otherwise require to be paid to a Covered Employee, the maximum Performance-Based Award payable to any one Covered Employee under the Plan for a calendar year is $1,000,000.5.Final Payout Eligibility RequirementsThe following are conditions which regulate the payout of any incentive compensation:a.A Named Executive must be classified as a regular and full-time employee for the entire calendar year and be of active status in order to receive payment.b.A Named Executive must be hired and on the active payroll as full-time as of the first business day after October 1 of the applicable calendar year in order to participate during that calendar year and will be paid at a prorated payout amount.c.If a Named Executive, who was previously eligible for another MVB-based incentive plan, is promoted to a position eligible for the Plan, he or she will be eligible for a prorated payout based on both plans’ criteria. d.A Named Executive on leave of absence, regardless of type, will receive the incentive payment only upon return to regular, full-time, active status; provided, however, that Named Executive on military leave will be issued payment at the time incentive checks are issued even if they have not returnedto regular, full-time, active status at that time.6.Additional Plan Payout Conditionsa.In the event of major economic changes, catastrophic events, or any other circumstances not contemplated by MVB (but subject to the rules described above relating to Qualified Performance-Based Awards), the MVB Board of Directors, working through its Human Resources and Compensation Committee, reserves the right to alter, amend or terminate these Guidelines and any awards hereunder.b.In the event MVB restates its financial results within twelve (12) months of the payment of an award under these Guidelines due to material non-compliance with any financial reporting requirements of the federal securities laws as a result of a Named Executive’s intentional “misconduct” (as determined by the members of the MVB), the Named Executive will reimburse MVB the difference between the amount of the awardC-5actually awarded and the amount of the award such an executive officer would have received had the amount of the award been calculated based on the restated financial statements. c.The altering, inflating, and/or inappropriate manipulation of performance/financial results or any other infraction of recognized ethical business standards, will subject the Named Executive to disciplinary action up to and including termination of employment. In addition, any award as provided by the Plan to which the Named Executive would otherwise be entitled will be revoked.d.A Named Executive who has willfully engaged in any activity injurious to MVB will forfeit any award earned during the award period in which the activity occurred.e.Regarding acquisitions/mergers, end of year goals or expenses will not be adjusted. MVB will not gain net income credit nor will deduct the cost of the acquisition/merger from expenses before final payout is made.7.Employment Status Changes and Retirementa.Except as set forth below, a Named Executive whose employment with MVB ends for any reason, other than death, prior to the issuance of incentive, will forfeit any incentive he or she otherwise would have been entitled to receive.b.A Named Executive who dies or whose employment ends due to disability or retirement after the end of the calendar year, but before the issuance of the incentive, will not forfeit the incentive which the Named Executive would have otherwise been entitled to receive.c.A Named Executive who dies or whose employment ends due to disability during a calendar year will participate on a prorated basis in the incentive program based upon the number of weeks of employment with MVB during such year.d.A Named Executive whose employment ends due to retirement during a calendar year will participate on a prorated basis in the incentive program based upon the number of weeks of employment with MVB during such calendar year provided that the Named Executive’s term of employment is at least one-half of the calendar year. e.A Named Executive who terminates employment due to retirement in the first half of the calendar year will not receive any incentive amounts pursuant to these Guidelines for such calendar year.f.These Guidelines do not in any manner restrict the right of MVB or the Named Executive to end employment at any time, for any reason, with or without cause.C-6. Electronic Voting Instructions Available 24 hours a day, 7 days a week! Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy. VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR. Proxies submitted by the Internet or telephone must be received by 11:59 a.m., Eastern Standard Time, on May 16, 2016. Vote by Internet • Go to www.investorvote.com/MVBF • Or scan the QR code with your smartphone • Follow the steps outlined on the secure website Vote by telephone • Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone • Follow the instructions provided by the recorded message Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. q IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q A Proposals — The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2 – 4. 1. Election of Directors: + For Withhold For Withhold 01 – H. Edward Dean, III 02 – J. Christopher Pallotta For Against Abstain ForAgainst Abstain 2. To approve a non-binding advisory proposal on the compensation of the Named Executive Officers. 3. To act upon a proposal to approve the 2016 Annual Executive Performance Incentive Plan for the executive officers of MVB. 4. To ratify the appointment of Dixon Hughes Goodman, LLP as the independent registered accounting firm for MVB for the year 2016. 5. Any other business which may properly be brought before the meeting or any adjournment thereof. B Non-Voting Items Change of Address — Please print your new address below. Comments — Please print your comments below. Meeting Attendance Mark the box to the right if you plan to attend the Annual Meeting. C Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. + 1 U P X 02C22B Annual Meeting Proxy Card X IMPORTANT ANNUAL MEETING INFORMATION. q IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q Proxy — MVB Financial Corp. Notice of 2016 Annual Meeting of Shareholders MVB Bank office 400 Washington St., East - Charleston, WV 25301 Proxy Solicited by Board of Directors for Annual Meeting — May 17, 2016 KNOW ALL PERSONS BY THESE PRESENTS, That the undersigned shareholder(s) of MVB Financial Corp. (“MVB”), Fairmont, West Virginia, does (do) hereby nominate, constitute and appoint Lisa J. McCormick and Brian Mostellar or any of them, with full power to act as my (our) true and lawful attorney with full power of substitution for me (us) to vote all the Common Stock of MVB standing in my (our) name on its books at the close of business on March 28, 2016, at the Annual Meeting of Shareholders of MVB to be held at the MVB Bank office, 400 Washington St., East - Charleston, WV on May 17, 2016, at 10:00 a.m., and at any and all adjournments of said meeting, with all the powers the undersigned would possess if personally present, as follows: Lisa McCormick, Brian Mostellar, or any of them, each with the power of substitution, are hereby authorized to represent and vote the shares of the undersigned, with all the powers which the undersigned would possess if personally present, at the Annual Meeting of Stockholders of MVB Financial Corp. to be held on May 17, 2016 or at any postponement or adjournment thereof. Shares represented by this proxy will be voted as indicated by the stockholder. If no such directions are indicated, the Proxies will have authority to vote FOR Proposal 1, Election of Directors, FOR Proposal 2, To approve a non-binding advisory proposal on the compensation of the Named Executive Officers, FOR Proposal 3, To act upon a proposal to approve the 2016 Annual Executive Performance Incentive Plan for the executive officers of MVB and FOR Proposal 4, To ratify the appointment of Dixon Hughes Goodman, LLP as the independent registered accounting firm for MVB for the year 2016. In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting. (Items to be voted appear on reverse side.)