NORWOOD FINANCIAL CORP
INFORMATION TO BE INCLUDED IN THE REPORT
Section 5 - Corporate Governance and Management
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(c) On June 21, 2024, the Norwood Financial Corp (the “Company”) issued a press release announcing that the Board of Directors had appointed John M. McCaffery as Executive Vice President and Chief Financial Officer of the Company, and its wholly owned subsidiary, Wayne Bank (the “Bank”), effective as of June 24, 2024. In addition, the Board announced that as of June 24, 2024, William S. Lance, previously Executive Vice President and Chief Financial Officer, resigned his position as Chief Financial Officer and has been appointed Executive Vice President and Chief Strategic Officer until his retirement on August 2, 2024. Mr. McCaffery is a banker with approximately 30 years of experience in the financial services industry, with a focus on regulatory and financial compliance. His experience includes capital raising of both debt and equity, significant experience with M&A transactions and integrations and a proven record of success guiding banking organizations through substantial growth and restructuring.
A copy of the Company’s press release is filed with this report as exhibit 99.1 hereto and incorporated herein by reference.
(e) Employment Agreement. The Company and the Bank have entered into an Employment Agreement (the “Agreement”) with Mr. McCaffery that will be effective as of June 24, 2024. Pursuant to the Agreement, Mr. McCaffery will be employed as the Executive Vice President and Chief Financial Officer the Company and the Bank. Mr. McCaffery will be paid a salary at the rate of $340,000 per annum or such higher amount as may be determined from time to time (“Base Salary”). The Agreement is for the period commencing on June 24, 2024 (the “Effective Date”) and ending thirty-six (36) months thereafter, unless terminated earlier. On each annual anniversary date of the Effective Date, the Agreement will automatically be extended for an additional 12 months unless either party has beforehand provided the other party with written notice that the Agreement shall not be extended at such time. Mr. McCaffery’s employment will be for no definite period of time, and Mr. McCaffery, on one hand, and the Company and/or the Bank, on the other hand, may terminate such employment relationship at any time for any reason or no reason.
Mr. McCaffery will be eligible to participate in the employee benefits generally applicable to employees of the Bank, including: group hospitalization, disability, health, dental, sick leave, life insurance, travel and/or accident insurance and retirement plans. He will receive a $600 per month car allowance.
The Agreement provides that for 2024, Mr. McCaffery will receive an award under the Bank’s Annual Cash Bonus Plan calculated at the target performance level of 25% or $85,000. He will receive $25,000 of such award in the form of Company common stock as a Sign-On Equity Award immediately following his commencement of employment, and the balance of such bonus award ($60,000) will be paid in cash during the first quarter of 2025. Future Annual Cash Bonus awards will be based upon established performance goals which will include both Company and individual goals.
The Sign-on Equity Award will provide for a five-year vesting period at the rate of 20% per year beginning one year after the award date. The Sign-on Equity Award will provide for the
