David M. Flair

About David M. Flair

David M. Flair is Co-President and Chief Executive Officer of BV Financial, Inc. (BVFL) and BayVanguard Bank, and a director since 2012. He became CEO in 2013, President in 2014, and previously served as CFO in 2012–2014; he is a certified public accountant with nearly 20 years as a partner at Anderson Associates LLP and Beard Miller Company LLP before joining Advance Bank in 2006 as CFO, later acting CEO and director; age 61 in 2025; director since 2012 . Under his leadership, BVFL adopted a new 2024 Equity Incentive Plan and granted sizable equity awards in 2024 to align management with stockholders via multi-year vesting and double-trigger protections .

Past Roles

External Roles

• No additional public-company directorships or external committee roles are disclosed for Mr. Flair in the latest BVFL proxies .

Fixed Compensation

• Employment agreements set current specified base salaries at $426,480 for each Co-CEO, subject to increases (not decreases) and review upon a change in control .

Performance Compensation

Key terms and vesting:

• 2024 RS awards: Grant-date price $14.86; vest 25% per year commencing Sept 6, 2025 .
• 2024 option awards: Exercise price $14.86; vest 25% per year commencing Sept 6, 2025; expire 09/17/2034 .
• Outstanding fully-exercisable legacy options: 21,433 @ $5.65, expiring 12/31/2027 .

Plan design and metrics:

• The 2024 Equity Plan permits performance goals across a broad menu (e.g., EPS, ROE, efficiency ratio, NIM, asset quality, growth, TSR), with double-trigger vesting on change in control; repricing prohibited; dividends on unvested awards accrue until vesting .

Equity Ownership & Alignment

Award and vesting overhang (sell-pressure watch):

• As of Dec 31, 2024 Mr. Flair held 97,989 unvested RS and 244,974 unexercisable options vesting 25% annually from Sept 6, 2025—creating potential annual supply overhang at each vest date .

Hedging/pledging, clawback, guidelines:

• Company does not prohibit hedging by directors/executives (no anti-hedging policy) — a governance red flag for alignment .
• Awards are subject to company clawback policy and trading/hedging/pledging policies as in effect .
• No explicit stock ownership guidelines disclosure for executives was identified in the proxy excerpts reviewed .

Employment Terms

• Rolling 3-year Employment Agreements (initially entered in 2018/2019) auto-extend annually to maintain a three-year remaining term; term extends to at least three years post-change-in-control .
• Severance on qualifying termination (without cause/for good reason): Lump sum equal to 3× average taxable income for prior 5 tax years; continued life, medical and dental benefits until end of agreement term or re-employment .
• Change-in-control payment: 3× the sum of (1) average taxable income (prior 5 years) + (2) prior-year 401(k) match + (3) prior-year ESOP contribution; 280G cutback applies if economically favorable vs. paying excise tax .
• Salary Continuation Plan: Normal retirement age 68; $100,000 per year for 15 years with death/disability/CIC and early separation provisions as disclosed .

Board Governance

• Board service: Director since 2012; CEO since 2013; President since 2014 .
• Committees are fully independent: Audit (Chair W.S. Baldwin), Compensation (Chair G.T. Amereihn), Governance & Nominating (Chair J.W. Posnick); Mr. Flair does not serve on these committees .
• Attendance: In 2023, BV Financial board held 11 meetings; bank board held 12; no director attended <75% of meetings; eight of ten directors attended the 2023 annual meeting .
• Director compensation: Neither Mr. Flair nor Mr. Prindle received director fees in 2024 (compensated only as executives) .
• Dual-role implications: Mr. Flair is an executive director (Co-CEO and director), but key oversight committees are fully independent, mitigating independence concerns .

Director Compensation (for completeness)

• 2024 non-employee director compensation reflected initial equity grants under the 2024 Equity Plan (36,746 options and 14,698 RS per director; 25%/year vesting from Sept 6, 2025) .
• This section confirms zero director compensation for Mr. Flair in his capacity as director .

Performance & Track Record

Company fundamentals during recent years:

• EBITDA not available via S&P for these periods (n/a).*
• Note: The company is a financial institution; GAAP “Revenues” and EBITDA definitions may differ from bank-specific net interest income and operating metrics.
• Values retrieved from S&P Global.*

Risk Indicators & Red Flags

• Hedging permitted (no anti-hedging policy) for directors/executives/employees — misalignment risk with long-term shareholders .
• Substantial 2024 equity awards (options/RS) with multi-year vesting introduce potential selling pressure around annual vest dates once restrictions lapse .
• Clawback policy applies to awards; insider trading policy governs exercises; grants not timed around MNPI; no repricing without shareholder approval .
• Section 16(a) compliance generally satisfactory; 2024 late Form 4 filings were noted for certain directors due to 2024 Plan grants; Flair not listed among late filers .
• No related-party transactions involving Mr. Flair identified in the proxies reviewed; selective RPT disclosures involve another director’s firm .

Compensation Structure Analysis

• 2024 shift toward equity-heavy compensation (Stock Awards $1.46M; Options $1.09M) versus relatively modest salary ($434k), consistent with post–second-step conversion equity plan adoption and alignment aims .
• Nonequity incentive payouts increased (2023: $318,864; 2024: $347,562), but proxies do not disclose specific annual incentive metric weightings/targets; the broad performance menu leaves room for discretion .
• Employment/CIC economics are sizable (3× base measures) and, alongside a $100,000/year salary continuation plan, raise potential “golden parachute” optics despite 280G cutback .

Investment Implications

• Alignment: Large multi-year RS and option grants in 2024, double-trigger vesting, and no director fees for Flair support alignment, while the absence of an anti-hedging policy detracts from best practices .
• Supply overhang/trading signal: ~98k unvested RS and ~245k unvested options vesting 25% annually from Sept 6, 2025 imply potential selling pressure around vesting/10b5-1 windows; monitor Form 4s around those dates .
• Retention vs. cost: Rolling 3-year contracts, 3× severance/CIC structure, and a $100k/year salary continuation plan are strong retention levers but add downside cost in turnover or transaction scenarios .
• Pay-for-performance visibility: Cash incentive payouts are disclosed but underlying annual performance metrics/weightings are not; equity plan allows performance criteria but specifics for executive grants were not detailed—suggests monitoring Compensation Committee disclosures in future proxies for tighter pay-performance linkage .
• Ownership: Flair’s beneficial stake rose to ~2.08% by Mar 14, 2025—material alignment for a small-cap bank—supported by ESOP/401(k) holdings and unvested equity .

Citations:

• Background, roles, age, board tenure
• Compensation tables and amounts
• Equity awards, grant terms, vesting, outstanding awards
• Ownership tables (2024, 2025)
• Employment agreements, severance/CIC, salary continuation
• Committees, independence, attendance, director comp
• 2024 Equity Plan features (double-trigger, no repricing, dividends, limits)
• Hedging/clawback policies
• Section 16(a) compliance and RPTs

Footnote: *Values retrieved from S&P Global.