Lauri Fernald
About Lauri E. Fernald
Independent director since 2005 (current age 63), Fernald is a Certified Funeral Service Practitioner and owner of Jordan Fernald Funeral Home in Mount Desert, Maine. She chairs the Compensation & Human Resources Committee and serves on the Governance, Board Risk, and Executive Committees; she is considered independent under NYSE American standards and attended at least 96% of Board/committee meetings in 2024. Tenure on the BHB board is 19 years.
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Jordan Fernald Funeral Home | Owner; Certified Funeral Service Practitioner | — | Local business leadership supporting market insight |
| Hospice Volunteers of Hancock County | Finance Committee member | — | Financial oversight in community organization |
| Parish of St. Mary and St. Jude (Northeast Harbor & Seal Harbor) | Senior Warden; Altar Guild Member | — | Faith/community stewardship |
| Maine Coast Memorial Hospital Foundation Council | Member | — | Community health foundation engagement |
| Woodbine Cemetery Association of Ellsworth | Member | — | Local governance participation |
| Brookside Cemetery Corp. of Mount Desert | Treasurer; “Sexant” (per filing) | — | Financial/administrative governance |
External Roles
| Organization | Role | Public Company? | Notes |
|---|---|---|---|
| — | — | — | No public company directorships disclosed in BHB’s 2025 proxy. |
Board Governance
- Committee assignments: Chair, Compensation & Human Resources; Member, Governance, Board Risk, Executive.
- Independence: All nominees except the CEO are independent per NYSE American; Fernald is independent.
- Attendance: Board held 10 regular meetings plus strategic planning and annual meeting; each director attended ≥96% of Board/committee meetings; all directors attended the 2024 annual meeting.
- Committee cadence (2024): Compensation & Human Resources (5); Board Risk (12; monthly); Governance (3); Executive (1).
- Executive sessions: Independent directors meet in executive session after Board meetings.
- Compensation consultant: Meridian Compensation Partners engaged by the Compensation & Human Resources Committee; independence assessed—no conflicts.
- Interlocks: No Compensation & Human Resources Committee member was an employee; no related-party transactions beyond ordinary-course loans; no interlocking relationships requiring disclosure.
Fixed Compensation (Director – 2024)
| Component | 2024 Amount |
|---|---|
| Fees earned or paid in cash | $42,000 |
| Annual equity grant (restricted shares) | $39,973 (1,103 shares granted 11/12/2024) |
| Total | $81,973 |
Notes: Independent directors receive quarterly cash retainers and an annual equity grant; additional retainers apply for Board/Committee Chairs; 2024 levels unchanged. CEO receives no director compensation.
Performance Compensation (Committee Oversight – NEO Programs)
- Director equity grants are time-based and fully vested at grant, with transfer restrictions; no director performance metrics apply.
- As Chair of the Compensation & Human Resources Committee, Fernald oversees NEO incentive design and outcomes. 2024 NEO annual cash incentive metrics and results:
| Measure | Weight | Threshold | Target | Stretch | Actual | Performance Factor |
|---|---|---|---|---|---|---|
| Adjusted Net Income ($000s) | 40% | $37,019 | $39,805 | $43,786 | $43,375 | 145% |
| Non-Performing Loans/Total Loans | 10% | 0.51% | 0.38% | 0.32% | 0.22% | 150% |
| Efficiency Ratio | 10% | 65.19% | 63.91% | 62.63% | 61.84% | 150% |
| Strategic Initiatives (qualitative) | 40% | n/a | n/a | stretch | stretch | 150% |
| Total payout vs. target | — | — | — | — | — | 148% |
- Long-term performance equity (2024–2026) metrics: 3-year average Core ROA and Core ROE vs. Custom Industry Index; payout 50%/100%/150% at 25th/50th/75th percentile.
- Prior cycle (2021–2023) RSUs vested at 103% of target (52nd percentile relative ROA).
Other Directorships & Interlocks
| Category | Detail |
|---|---|
| Public company boards | None disclosed. |
| Committee interlocks | None requiring disclosure for the Compensation & Human Resources Committee. |
Expertise & Qualifications
- Commercial operator with local market insight; extensive community leadership roles.
- Board committee leadership (Compensation & Human Resources Chair) and membership across Governance, Risk, and Executive committees.
- Board skills matrix shows broad board experience and long tenure (19 years), supporting continuity.
Equity Ownership
| Item | Detail |
|---|---|
| Total beneficial ownership | 18,319 shares; less than 1% of outstanding. |
| Director equity grant (2024) | 1,103 restricted shares; grant-date fair value $39,973; fully vested; transfer restricted until 3 months post-board service. |
| Ownership guidelines | Directors and NEOs subject to stock ownership and retention guidelines; all equity (net of taxes/fees) must be held until guidelines met. |
| Hedging policy | Company prohibits hedging of BHB securities. |
Governance Assessment
- Strengths: Independent status; high attendance; multi-committee service with CHR chairmanship; robust incentive governance with multiple metrics, caps, clawback, and stock ownership/retention requirements; positive shareholder support for Say-on-Pay (87% in 2024).
- Controls: Compensation consultant independence affirmed; BRC monthly oversight of cybersecurity, credit, liquidity, and compensation risk; independent Audit Committee and financial experts; executive sessions of independent directors.
- RED FLAG: Related-party lease—Somesville branch leased from A.C. Fernald Sons, Inc.; Fernald holds 16.5% minority interest; lease payments since 1/1/2024 totaled $127,289 with $108,274 remaining base payments to maturity (June 2026); CPI-based escalator; taxes/operating expenses borne by bank. Audit/related-party policy applies; Board concluded independence remains intact.
- Insider credit: Aggregate loans to directors/NEOs totaled ~$2.56M (with ~$5.03M unfunded commitments) at 12/31/2024, offered on market terms under Regulation O and overseen by Audit Committee—no elevated risk features disclosed.
- Shareholder alignment: Directors compensated with equity and cash; equity holdings and retention requirements reinforce alignment; director equity grants are fully vested but subject to transfer restriction until leaving board service.
Additional Signals for Investors
- CHR governance: Balanced pay mix with significant at-risk pay, multi-metric annual incentives, and long-term relative ROA/ROE metrics—indicative of disciplined pay-for-performance oversight under Fernald’s chairmanship.
- Shareholder feedback: Annual Say-on-Pay adopted; 2024 approval 87%, suggesting investor support for compensation programs.
- No tax gross-ups: Change-in-control/severance arrangements exclude excise tax gross-ups; cutback provisions apply.
Attendance & Committee Activity (2024)
| Body | Meetings | Notes |
|---|---|---|
| Board of Directors | 10 regular; 1 strategic; 1 annual | ≥96% attendance per director; all attended annual meeting. |
| Compensation & Human Resources Committee | 5 | Independent members; CHR administers clawback policy. |
| Board Risk Committee | 12 (monthly) | Oversees cybersecurity, credit/loan policies (> $5M approvals), enterprise risk. |
| Governance Committee | 3 | ESG oversight; board composition and refreshment. |
| Executive Committee | 1 | Acts between Board sessions. |
Related-Party & Conflicts Summary
| Transaction | Counterparty | Terms | Exposure |
|---|---|---|---|
| Somesville branch lease | A.C. Fernald Sons, Inc. (Fernald 16.5% owner) | CPI escalator; taxes/ops paid by bank | $127,289 paid since 1/1/2024; $108,274 base remaining to Jun-2026. |
| Insider loans (aggregate) | Directors/NEOs | Ordinary course; market terms; Regulation O; Audit oversight | $2,555,150 outstanding; $5,030,901 unfunded at 12/31/2024. |
Policies Supporting Governance
- Clawback policy compliant with NYSE American/SEC rules; applies to erroneously awarded incentive comp; administered by CHR Committee.
- Prohibition on hedging by directors/insiders/employees.
- Code of Conduct/Ethics; independent Audit Committee with financial experts; committee charters publicly available.
Insider Trades
- Section 16(a) compliance: Company reports timely filings by executives/directors and >10% holders for FY2024; specific Form 4 transactions not disclosed in proxy.
Say-on-Pay & Compensation Peer Group
- 2024 Say-on-Pay approval: 87.0%.
- Compensation peer group of 18 Northeast/Mid-Atlantic banks ($2–$8B assets) used for benchmarking; refreshed annually.
Equity Ownership & Director Compensation Tables (Reference)
- Beneficial ownership (selected): Fernald 18,319 shares; “*” denotes <1%. Outstanding shares: 15,317,222 (as of 3/10/2025).
- 2024 director compensation table (Fernald row above).
Overall: Fernald’s independence, attendance, and committee leadership support board effectiveness. The Somesville lease is a manageable but notable related-party exposure; continued transparent disclosure and Audit Committee oversight mitigate conflict risk. Strong CHR governance (multi-metric incentives, clawback, ownership) and shareholder support (87% Say-on-Pay) bolster investor confidence.