ORRSTOWN FINANCIAL SERVICES INC
For the period ended Mar 22, 2024. Filed Mar 22, 2024.
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What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
Mar 22, 2024 · Filed Mar 22, 2024
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DEF 14A 1 proxystatement2024.htm DEF 14A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrantx Filed by a Party other than the Registrant¨
Check the appropriate box:
| ¨ | Preliminary Proxy Statement | |
|---|---|---|
| ¨ | Confidential, for Use of the Commission Only (as permitted by Rule 14(a)-6(e)(2)) | |
| x | Definitive Proxy Statement | |
| ¨ | Definitive Additional Materials | |
| ¨ | Soliciting Material Pursuant to § 240.14a-12 | |
| ORRSTOWN FINANCIAL SERVICES, INC. | ||
| (Name of Registrant as Specified in its Charter) | ||
| (Name of Person(s) Filing Proxy Statement, if other than the Registrant) | ||
| Payment of filing fee (Check the appropriate box): | ||
| x | No fee required | |
| ¨ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. | |
| (1) | Title of each class of securities to which transaction applies: | |
| (2) | Aggregate number of securities to which transaction applies: | |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11. (set forth the amount on which the filing fee is calculated and state how it was determined): | |
| (4) | Proposed maximum aggregate value of transaction: | |
| (5) | Total fee paid: | |
| ¨ | Fee paid previously with preliminary materials. | |
| ¨ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | |
| (1) | Amount previously paid: | |
| (2) | Form, Schedule or Registration Statement No.: | |
| (3) | Filing Party: | |
| (4) | Date Filed: | |
March 22, 2024
Dear Shareholder:
On behalf of the Board of Directors, management and employees of Orrstown Financial Services, Inc. (the “Company”), the holding company for Orrstown Bank, I cordially invite you to participate in our 2024 Annual Meeting of Shareholders (the “Annual Meeting”). The Annual Meeting will again be held virtually via live webcast on Tuesday, April 30, 2024, at 9:00 a.m., local time. Shareholders will not be able to attend the Annual Meeting in person. The proxy statement included with this letter details how you can participate in the Annual Meeting.
The attached Notice of Annual Meeting and Proxy Statement describe the formal business we expect to act upon at the Annual Meeting. We will also report on our results of operations. Our directors and officers, as well as representatives of Crowe LLP, our independent registered public accounting firm, will be present to respond to shareholder questions.
The Board of Directors of the Company has determined that the affirmative vote "FOR" all nominees for director and "FOR" all proposals to be considered at the Annual Meeting is in the best interests of the Company and its shareholders and unanimously recommends a vote "FOR" all nominees and proposals.
Your vote is important, regardless of the number of shares you own. We encourage you to vote by proxy so that your shares will be represented and voted at the Annual Meeting. We offer several ways for shareholders to vote. Voting can be completed by returning the enclosed proxy card, online, or by using your mobile device. Voting by proxy will not prevent you from voting during the Annual Meeting, but will ensure that your vote is counted if you cannot participate.
We thank you for your continued support of the Company and Orrstown Bank, and look forward to your participation at the Annual Meeting.
Sincerely,
Thomas R. Quinn, Jr.President and Chief Executive Officer
77 East King Street
Shippensburg, Pennsylvania 17257
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 30, 2024
The Annual Meeting of Shareholders of Orrstown Financial Services, Inc. (the “Company”), the holding company for Orrstown Bank, will be held virtually on Tuesday, April 30, 2024, at 9:00 a.m. local time, to consider and take action on the following matters:
| 1. | To elect three Class C director nominees to serve on our Board of Directors for a three-year term expiring in 2027; |
| 2. | To approve a non-binding advisory vote regarding the compensation paid to our Named Executive Officers (“Say-On-Pay”); and |
| 3 | To ratify the Audit Committee’s selection of Crowe LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024. |
Any action may be taken on the foregoing matters at the Annual Meeting on the date specified above, or on any date or dates to which the Annual Meeting may be adjourned, or to which the Annual Meeting may be postponed.
Your Board of Directors recommends a vote “FOR” the election of all nominees as directors listed in the enclosed proxy statement; “FOR” approval of the non-binding advisory vote regarding the compensation paid to our Named Executive Officers; and “FOR” ratification of the Audit Committee’s selection of Crowe LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024.
This Notice of Annual Meeting of Shareholders, the proxy statement and the enclosed proxy card are being mailed on or about March 22, 2024 to shareholders of record at the close of business on March 1, 2024. A copy of the Annual Report on Form 10-K for the year ended December 31, 2023 is also enclosed.
Please note that the proxy statement relates solely to our 2024 Annual Meeting of Shareholders and does not contain information regarding the Company’s proposed merger of equals with Codorus Valley Bancorp, Inc. and does not ask you to consider the merger agreement or the transactions contemplated thereby. We do not intend to discuss the proposed merger or the merger agreement at our 2024 Annual Meeting of Shareholders. Instead, we will hold a separate, special meeting of shareholders on a future date to consider and approve the issuance of shares of the Company’s common stock in connection with the merger and the transactions contemplated by the merger agreement. At the appropriate time, we will send a separate package of proxy solicitation materials to you for the special meeting of shareholders in connection with the proposed merger. The merger is subject to closing conditions set forth in the merger agreement, including among others the approval of the issuance of shares of the Company’s common stock as merger consideration by the Company’s shareholders.
Sincerely,
Robert G. Coradi
Secretary
March 22, 2024
Important Notice Regarding Internet Availability of Proxy Materialsfor the Annual Meeting of Shareholders to be Held Virtually on April 30, 2024 at 9:00 a.m.The Proxy Statement and Annual Report on Form 10-K are available on the Internet athttps://www.cstproxy.com/orrstown/2024
Table of Contents
| About Orrstown | 1 | |
|---|---|---|
| Corporate Social Responsibility and ESG | 1 | |
| Environmental, Social and Governance Matters Q&A | 3 | |
| Ethics | 6 | |
| Risk Oversight | 6 | |
| Cautionary Note Regarding Forward-Looking Statements | 7 | |
| General Information About the Annual Meeting | 9 | |
| Why are you holding a virtual Annual Meeting? | 9 | |
| Who is entitled to vote? | 9 | |
| On what am I voting? | 9 | |
| How does the Board of Directors recommend I vote? | 9 | |
| How do I vote? | 10 | |
| Can I change my vote after I submit my proxy? | 10 | |
| What constitutes a quorum? | 10 | |
| How are abstentions and broker non-votes counted? | 10 | |
| What vote is required to elect directors? | 11 | |
| What vote is required to approve the other proposals? | 11 | |
| How is my vote counted? | 11 | |
| Who will count the vote? | 11 | |
| What is the deadline for shareholder proposals for next year’s Annual Meeting? | 11 | |
| How are proxies being solicited? | 11 | |
| Virtual Meeting Information | 11 | |
| How do I participate in the meeting? | 11 | |
| Will I have an opportunity to submit a question? | 12 | |
| Can I participate in the meeting or submit a question if I hold my shares in street name? | 12 | |
| What if I have lost or misplaced my 12-digit control number? | 12 | |
| What if I experience technical difficulties accessing the meeting? | 12 | |
| What will happen if we experience technical problems during the meeting webcast? | 12 | |
| Important Notice Regarding Internet Availability of Proxy Materials for the Annual Meeting of Shareholders to be held on April 30, 2024 | 12 | |
| Share Ownership of Certain Beneficial Owners | 13 | |
| Share Ownership of Management | 13 | |
| Proposal 1 – Election of Directors | 14 | |
| Board Overview | 14 | |
| Independent Chairman | 15 | |
| Nomination of Directors | 15 | |
| Director Eligibility Requirements | 15 | |
| Biographical Summaries of Nominees and Directors | 16 | |
| Nominees for Director | 16 | |
| Director Independence | 17 | |
| Shareholder Communications with the Board of Directors | 17 | |
| Board Self-Assessment | 17 | |
| Board Structure, Committees and Meeting Attendance | 17 | |
| Audit Committee Report | 20 | |
| Compensation Committee Interlocks and Insider Participation | 20 | |
| Transactions with Related Persons, Promoters And Certain Control Persons | 20 | |
| Compensation Of Directors | 21 | |
| (continued) | ||
| Board Diversity | 22 | |
| Board Diversity Matrix | 23 | |
| Information About Executive Officers | 24 | |
| Compensation Discussion and Analysis | 25 | |
|---|---|---|
| Executive Summary | 25 | |
| Shareholder Engagement | 26 | |
| How We Set Compensation | 27 | |
| 2023 Compensation of Our Named Executive Officers | 28 | |
| Pay Versus Performance | 47 | |
| 2023 Pay Ratio Disclosure | 50 | |
| Proposal 2 – Advisory Vote Regarding the Compensation Paid to Named Executive Officers | 51 | |
| Proposal 3 – Ratification of The Audit Committee's Selection of Crowe LLP as the Company's Independent Registered Public Accounting Firm for the Fiscal Year Ending December 31, 2024 | 52 | |
| Relationship with Independent Registered Public Accounting Firm | 53 | |
| Involvement in Certain Legal Proceedings | 53 |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.