Martin R. Brown

About Martin R. Brown

Independent director since 2006; age 73. Brown is a licensed Pennsylvania Funeral Director (Pittsburgh Institute of Mortuary Science, honors, 1973) and an entrepreneur operating family funeral homes and several local retail businesses; the Board cites his local-market leadership and business management as key credentials. He is independent under Nasdaq rules and is up for re‑election as a Class B director (term expiring 2028). Committee chair role: Trust; other committees: Audit, Compensation & Personnel, Executive .

Past Roles

External Roles

Board Governance

• Independence: Board determined Brown is independent (all directors independent except CEO and President) .
• Committee assignments (2024):
  • Trust Committee – Chair
  • Audit Committee – Member (Audit met 4 times in 2024)
  • Compensation & Personnel Committee – Member (6 meetings in 2024; all members independent)
  • Executive Committee – Member
• Attendance and engagement:
  • In 2024, the Boards met 22 times and committees 38 times (60 total). All directors attended ≥75% of aggregate meetings and attended the 2024 annual meeting .
• Board leadership and structure: Independent Chair leads the Board; all committees chaired by independent directors; additional committees include Asset‑Liability, Strategic Initiative, Enterprise Risk Management, Executive, and Trust .

Fixed Compensation

• 2024 director fee structure (components): | Component | 2024 Amount | |---|---| | Board Chair Annual Retainer | $52,500 | | Vice Chair Annual Retainer | $13,125 | | Franklin Financial Annual Board Retainer | $19,000 | | F&M Trust Annual Board Retainer | $23,000 | | Audit Committee Chair Retainer | $10,000 | | Committee Chair Retainer | $5,000 | | Committee Meeting Fee (FF or F&M Trust) | $750 |

• Brown’s reported director pay: | Year | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Total ($) | |---|---:|---:|---:| | 2024 | 71,250 | 13,060 | 84,310 | | 2023 | 69,500 | 9,750 | 79,250 |

• Deferred compensation: Brown elected to defer $23,000 of 2024 director fees (only director to do so in 2024). In 2023, he deferred $22,000 (only director to do so in 2023) .

Performance Compensation

• Board equity plan mechanics and metrics:

  • Awards made annually after year-end based on two criteria with one-year full vesting:
    • Net Income vs Budget (40% weight)
    • ROE vs peer median (60% weight) | Performance Criterion | Weight | Threshold | Target | Outstanding | |---|---:|---:|---:|---:| | Net Income v. Budget | 40% | 95%–99% of budget | 100%–110% of budget | >110% of budget | | ROE Peer Performance | 60% | 95%–99% of peer median | 100%–110% of peer median | >110% of peer median |
  • For 2023 performance (awarded in 2024), the Corporation achieved “Outstanding” on both metrics; restricted stock awards were approved; shares vest in one year .

• Restricted stock outstanding (context):

  • As of 12/31/2023, each director generally had 300 restricted shares outstanding (with noted exceptions not including Brown) .
  • As of 12/31/2024, the beneficial ownership table lists Brown’s total and a separate count under the stock award columns (see Equity Ownership table) .

Other Directorships & Interlocks

• Other public company directorships: None disclosed for Brown .
• Compensation Committee interlocks: None in 2024 and none in 2023; no members were employees/former employees .

Expertise & Qualifications

• Licensed Pennsylvania Funeral Director; honors graduate, Pittsburgh Institute of Mortuary Science (1973) .
• Entrepreneur/business owner (funeral services, retail, restaurant, convenience, and local mall ownership) with strong local market knowledge in Fulton and Huntingdon Counties; Board values his entrepreneurial and management background .

Equity Ownership

Notes: Plan-related columns include unvested restricted stock and options issued under the 2019 Omnibus Stock Incentive Plan and the Employee Stock Purchase Plan, per table note (2) .

Governance Assessment

• Strengths

  • Independent director with multi-committee involvement (Audit; Compensation & Personnel; Executive) and chair of Trust—positions that enhance board oversight of risk, controls, and fiduciary matters .
  • Attendance: Board states all directors met ≥75% attendance and attended the 2024 annual meeting; the Board and committees met 60 times in 2024, indicating active governance cadence .
  • Equity alignment via annual restricted stock awards tied to Net Income v. Budget and ROE vs peers; shares vest in one year, supporting alignment with financial performance .

• Potential Risks / RED FLAGS

  • Anti‑hedging/pledging: The Board has not adopted a hedging policy for directors/officers/employees—this is a shareholder‑unfriendly posture that can weaken alignment signals (no ban on hedging disclosed) .
  • Long tenure: Director since 2006—while still classified as independent, some investors view prolonged tenure as a potential softening of independence; FRAF’s guidelines also prevent nomination at age ≥75 (Brown is 73 and nominated for 2025) .
  • Related‑party exposure via ordinary‑course banking: Directors and associated companies had banking relationships; loans were on market terms and subject to Board/Audit review policies; no problem loans noted (governance process in place, but remains an inherent conflict area) .

• Compensation structure observations

  • Mix shows modest equity component with performance-linked metrics and one‑year vest—aligns with near‑term results, but shorter vesting horizon can reduce long‑term alignment vs. multi‑year vesting typical at larger peers .
  • Brown made voluntary fee deferrals ($23k in 2024; $22k in 2023), a conservative stance toward compensation timing .