Mark R. Hollar
Executive Vice President, Treasurer and Chief Financial Officer at FRANKLIN FINANCIAL SERVICES CORP /PA/
Executive
About Mark R. Hollar
Mark R. Hollar is Executive Vice President, Treasurer, and Chief Financial Officer of Franklin Financial Services Corporation (FRAF) and its bank subsidiary F&M Trust, a role he has held since 2006; he is 63 years old . Recent company performance indicators relevant to incentive alignment show net income of $11,099k (2024), $13,598k (2023), and $14,938k (2022), while the value of a $100 TSR investment was $102.17 (2024), $103.53 (2023), and $113.44 (2022) . The board engaged PRJ Consulting on compensation matters in 2024 ($53k), and the company maintains an insider trading policy and an executive compensation clawback policy tied to financial restatements .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Franklin Financial Services Corporation / F&M Trust | EVP, Treasurer & CFO | 2006–present | Long-tenured finance leadership; core participant in budget, ROE peer benchmarking, and equity incentive frameworks tied to pay . |
External Roles
- No external directorships or outside roles were disclosed for Mr. Hollar in the latest proxy statements .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 259,852 | 273,754 | 284,700 |
| All Other Compensation ($) | 22,993 | 23,962 | 25,964 |
| Components (FY 2024): 401(k) company contributions ($) | 22,003 | — | — |
| Components (FY 2024): Split-dollar life insurance premium ($) | 321 | — | — |
| Components (FY 2024): Nonqualified pension contribution ($) | 3,640 | — | — |
Notes:
- The company offers broad-based health and welfare benefits, a 401(k), and maintains a defined benefit pension plan for employees hired before April 1, 2007 .
Performance Compensation
Annual (Short-Term) Incentive – Structure and Outcomes
- Plan design (2024) uses four criteria: Net Income vs Budget, ROE vs peer group, Individual Goals, and Discretionary; total weighting equals 100% and payouts vary by role .
- 2024 results: Corporation achieved Target for Net Income and Target for ROE; individual and discretionary components are reviewed case-by-case .
| Metric (CFO – 2024) | Weighting | Threshold (as % of salary) | Target (as % of salary) | Outstanding (as % of salary) | 2024 Actual Result |
|---|---|---|---|---|---|
| Net Income vs Budget | 25% | 10% | 20% | 35% | Target achieved |
| ROE vs Peer Performance | 35% | 10% | 20% | 35% | Target achieved |
| Individual Goals | 25% | 10% | 20% | 35% | Not disclosed |
| Discretionary | 15% | 10% | 20% | 35% | Not disclosed |
| Actual Annual Incentive Paid ($) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Non-Equity Incentive Plan | 52,797 | 79,389 | 63,346 |
Long-Term Incentive – Structure, Awards, and Vesting
- LTI Stock Plan uses two criteria: Net Income vs Budget (40%) and ROE vs peer performance (60%); awards are based on prior-year results and vest one-third annually over three years .
- Based on 2023 results (achieved Outstanding goals), Mr. Hollar received 1,238 restricted shares on March 1, 2024; one-third vests per year over three years .
| LTI Element | Grant Date | Shares Awarded | Vesting | Notes |
|---|---|---|---|---|
| Restricted Stock (2024 award) | 3/1/2024 | 1,238 | 1/3 annually over 3 years | Awarded based on 2023 performance |
| Restricted Stock (2022 award) | 3/1/2022 | 1,238 | 1/3 annually over 3 years | Awarded based on 2021 performance |
| Upcoming Restricted Stock Vesting (Unvested Shares) | 3/1/2025 | 3/1/2026 | 3/1/2027 | Total |
|---|---|---|---|---|
| Mark R. Hollar | 1,073 | 661 | 413 | 2,147 |
| Equity Compensation (Accounting Expense, $) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Stock Awards (FASB ASC 718) | 51,156 | 24,148 | 32,337 |
Clawback: The company adopted a policy for recovery of erroneously awarded incentive compensation tied to financial restatements; applicable to short- and long-term incentive components .
Equity Ownership & Alignment
| Ownership Detail (as of 12/31/2024) | Count / $ |
|---|---|
| Shares Beneficially Owned (direct/indirect) | 10,170 |
| Unvested Restricted Stock (total) | 2,147 |
| Stock Options (exercisable within 60 days) | 9,441 |
| Total Beneficial Ownership (including RS and options) | 21,758 |
| % of Shares Outstanding | Less than 1% (footnote guidance) |
| Shares Outstanding (context) | 4,440,442 (3/10/2025) |
Outstanding equity awards and terms:
- Options/ESPP
- ISO: 3,000 at $21.27, expiring 2/25/2026
- ISO: 3,000 at $30.00, expiring 2/23/2027
- ISO: 2,927 at $34.10, expiring 2/22/2028
- ESPP: 514 at $26.87, expiring 6/30/2025
- Unvested restricted stock and fair value at 12/31/2024 (at $29.90/sh):
- 3/1/2022 grant: 413 shares; value $12,349
- 3/1/2023 grant: 496 shares; value $14,830
- 3/1/2024 grant: 1,238 shares; value $37,016
Hedging/Pledging:
- The board states it has not adopted a hedging policy for directors, officers, and employees; the proxy is silent on a pledging prohibition. The company maintains an insider trading policy .
Ownership guidelines:
- No executive stock ownership guidelines or compliance status were disclosed in the proxy materials reviewed .
Employment Terms
- Agreement: Three-year term beginning March 1, 2022; auto-renews one year annually unless either party gives notice ≥180 days before the anniversary date .
- Pre-Change-in-Control termination (without Cause/by Executive for Good Reason): continuation of remaining base salary over the remaining employment period and up to two years of continued benefits .
- Post-Change-in-Control termination (without Cause): lump sum 2.5× annual base salary within 30 days plus up to two years of continued benefits (or cash reimbursement if benefits cannot be provided). Additionally, an extra payment equals the present value of unearned pension benefits (declining through November 2, 2026) .
- Covenants: Customary confidentiality and non-competition provisions survive termination (durations not specified in proxy) .
Performance & Track Record
| Performance Indicator | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Net Income ($000s) | 14,938 | 13,598 | 11,099 |
| TSR – Value of $100 Investment ($) | 113.44 | 103.53 | 102.17 |
| YoY % Change: CAP vs Net Income vs TSR (company table) | CAP to PEO: -2.6%; Other NEOs: 7.8%; TSR: +13.4%; Net Income: -23.8% (2022) | CAP to PEO: 1.9%; Other NEOs: -0.4%; TSR: -8.7%; Net Income: -9.0% (2023) | CAP to PEO: 1.8%; Other NEOs: 11.9%; TSR: -1.3%; Net Income: -18.4% (2024) |
Say‑on‑Pay:
- Shareholders approved executive compensation in 2024 by a majority of votes cast; a new Say‑on‑Pay vote is on the 2025 ballot .
Consultants and governance controls:
- PRJ Consulting advised on executive and director pay and incentive design in 2024 ($53k). The company maintains committee charters, corporate governance guidelines, a code of ethics, and an insider trading policy; clawback policy is in effect for incentive pay .
Investment Implications
- Pay-for-performance alignment: The CFO’s annual and long-term incentives are explicitly tied to Net Income vs Budget and ROE vs a defined peer group, with CFO annual payout opportunities at 10%/20%/35% of salary for threshold/target/outstanding respectively, indicating a meaningful at-risk pay component. 2024 outcomes achieved Target on both financial metrics, while absolute net income declined year over year, suggesting balanced use of relative and absolute performance tests .
- Near-term selling pressure: RS vesting of 1,073 shares on 3/1/2025 and 661 on 3/1/2026 represents defined supply events; Hollar also holds multiple ISO grants expiring 2026–2028 and an ESPP option expiring mid‑2025, which may influence trading windows but the proxy provides no Form 4 trend data for Hollar specifically .
- Alignment and risk controls: Beneficial ownership is under 1% but includes unvested RS and exercisable options; the presence of a clawback is positive. The absence of a board‑adopted hedging policy (and no explicit pledging prohibition disclosed) is a governance caution that can weaken alignment if unmanaged .
- Retention and change‑of‑control economics: The CFO’s CIC severance of 2.5× salary plus benefits (with an additional pension present‑value payment through November 2, 2026) is a relatively strong double‑trigger package for a regional bank, supporting retention but potentially elevating CIC costs for shareholders .
- Process credibility: Use of an independent pay advisor (PRJ Consulting) and disclosure of pay‑versus‑performance, including TSR and net income trends, support transparency; Say‑on‑Pay passed in 2024, signaling shareholder acceptance of the program despite softer earnings .