John D. Stokely, Jr.

About John D. Stokely, Jr.

Independent director of Eagle Financial Services, Inc. (Bank of Clarke) since 2006; age 72 as of the 2025 proxy. Former President and owner of Cavalier Land Development Corp.; past President of the Northern Virginia Building Industry Association and the Home Builders Association of Virginia; former Chairman and current Trustee of Shenandoah University; former Trustee of the University of Virginia School of Engineering and Applied Science. The Board classifies him as independent under Nasdaq listing standards.

Past Roles

External Roles

Board Governance

• Independence: Determined independent; only the CEO (Brandon Lorey) is not independent.
• Committee assignments (2024–2025):
  • Nominating/Corporate Governance Committee member alongside Nelson, Gilpin, and Rinker; committee met two times in 2024.
  • Not listed on Audit or Compensation Committees.
• Attendance and engagement:
  • 2024: Company Board met 11 times; Bank Board met 11 times; all directors attended >75% of aggregate meetings of boards and committees on which they served.
  • Executive sessions of independent directors held three times in 2024, led by the Chairman.
  • All directors attended the 2024 Annual Meeting.
• Board leadership: Independent Chairman separate from CEO; no Lead Independent Director given separate roles.

Fixed Compensation

Director fee structure (unchanged YoY):

• Annual board retainer: Chairman $37,000; other directors $25,000 (Bank’s Board).
• Committee chair retainers: Audit $4,000; Compensation $2,000.
• Meeting fees: Audit and Compensation $400 per meeting; other Bank committees $200 per meeting.

Performance Compensation

• Directors receive time-based restricted stock only; no performance-conditioned director equity disclosed. Each director received 600 shares of restricted stock that vested within the year.

Performance metric table (directors): None disclosed for director compensation (no TSR/ROAA/ESG metrics apply to directors’ equity awards).

Other Directorships & Interlocks

Expertise & Qualifications

• Entrepreneur/operator in real estate development with finance, strategic planning, and governance perspective highlighted by the Board.
• Higher-education board experience (Shenandoah University; UVA Engineering).
• Long EFSI board tenure (since 2006) supporting institutional knowledge and oversight continuity.

Equity Ownership

Section 16(a) compliance: No delinquent filings noted for Stokely in 2024; proxy notes one late filing for Mr. Milleson and an initial Form 3 for Mr. Smith. 2023 proxy notes delinquencies for Ms. Purrington and Mr. Lorey, not Stokely.

Insider trades: The proxy includes only a Section 16(a) compliance summary; individual Form 4 transactions by director are not detailed in the proxy statement.

Governance Assessment

• Board effectiveness and engagement:
  • Independent status; active service on Nominating/Corporate Governance (succession, board composition, governance practices); consistent attendance; participation in executive sessions signals independent oversight.
• Alignment and incentives:
  • Mixed cash/equity compensation with annual restricted stock grants that vest within the year; equity component supports alignment but single-year vesting limits long-term ownership lock-in relative to multi-year director equity programs.
  • Beneficial ownership is below 1%; nonetheless, multi-decade tenure provides continuity.
• Potential conflicts and controls:
  • Ordinary-course loans and deposits with directors and related parties are material in aggregate ($5.65M loans; $7.44M deposits at 12/31/2024), reviewed by the Board and subject to Regulation O; however, there is no formal related-party transaction review policy, which is a governance weakness.
  • Company discloses no anti-hedging policy (no policies restricting hedging/derivatives), which is shareholder-alignment risk; no pledging policy disclosed.
• Compensation governance:
  • Director compensation structure benchmarked; annual review by Compensation Committee; independent compensation advisor engaged for executive and director compensation.
• Shareholder feedback:
  • Prior say‑on‑pay approval ~95% in 2022; the Board recommends a three-year say‑on‑pay frequency, aligned with long-term evaluation cycles.

Red flags and watch items:

• Absence of a formal related‑party transaction approval policy despite ongoing director/officer lending under Regulation O (monitor for individual exposure and evolving policy).
• No anti‑hedging policy; consider engagement on hedging/pledging prohibitions to strengthen alignment.
• Director equity vests within the year; evaluate increasing multi‑year vesting or ownership guidelines to deepen “skin‑in‑the‑game.”

Positive signals:

• Independent classification, committee participation in governance, robust board/committee meeting cadence and >75% attendance; independent chairman separate from CEO.

Appendix: Committee Detail (2024–2025)

• Nominating/Corporate Governance Committee: Nelson, Gilpin, Rinker, Stokely; met twice in 2024; oversees board composition and governance practices.
• Audit Committee: Nelson (financial expert), Gilpin, Hamberger, Hill, Smalley; met five times in 2024.
• Compensation Committee (Bank Board): Matthews, Hamberger, Rinker, Smalley; met six times in 2024; independent members.