Dennis J. Zember, Jr.
About Dennis J. Zember, Jr.
Dennis J. Zember, Jr. is President and Chief Executive Officer of Primis Financial Corp. (FRST) and Primis Bank and has served as a director of both since February 19, 2020. He previously served as Executive Vice President and Chief Operating Officer (2016–2018) and Chief Financial Officer (2005–2017) of Ameris Bancorp. He is 55 years old. Recent company performance during his tenure shows 2024 TSR value of $85 vs peer group $111, a net loss of $16.2 million, and loan growth of -4.3% (company figures in thousands). The Compensation Committee identified Net Income, Deposit Growth, Gross Loan Growth, and Growth in Bank Operating Expenses as the most important measures linking company performance to compensation actually paid in 2024.
| Performance Snapshot | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Company TSR (Value of $100) | 98 | 80 | 89 | 85 |
| Peer Group TSR (Value of $100) | 125 | 102 | 95 | 111 |
| Net Income (Loss) $000s | 31,113 | 14,148 | (7,832) | (16,205) |
| Loan Growth % | 6.5% | 30.1% | 9.2% | (4.3%) |
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ameris Bancorp | Chief Financial Officer | Feb 2005–Dec 2017 | Finance leadership across growth cycle |
| Ameris Bancorp | EVP & Chief Operating Officer | Jun 2016–Jun 2018 | Enterprise operations leadership |
External Roles
- No other public-company directorships or external board roles are disclosed in Mr. Zember’s proxy biography.
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (% of Salary) | Actual Bonus/Non-Equity Incentive ($) | Stock Awards ($) | All Other Comp ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2024 | 718,176 | 50% (CEO target) | 0 | 0 | 70,263 | 788,439 |
| 2023 | 672,194 | — | 0 | 459,000 | 65,500 | 1,196,693 |
| 2022 | 639,112 | — | 250,000 | 498,102 | 45,963 | 1,433,177 |
- Base salary rate was increased effective March 1, 2024 to $722,113 (paid amount differs due to effective date).
Performance Compensation
Annual Incentive (STI) – 2024 Design and Outcomes
- Committee set four equally weightable non-income measures plus a 50% weight on Net Income vs. Budget; actuals implied a 70% payout of targets, but the Compensation Committee exercised negative discretion to cut CEO payout to 0% given a reported net loss and late filings tied to a third‑party consumer loan portfolio.
| 2024 Metric | Weight | Payout vs Target |
|---|---|---|
| Net Income as % of Budget (core, adjusted) | 50.0% | 50% |
| Deposit Growth | 16.7% | 121% |
| Gross Loan Growth | 16.7% | 0% |
| Growth in Bank Operating Expenses (lower is better) | 16.7% | 150% |
| Executive | 2024 Salary ($) | Target % | Target ($) | Actual Payout ($) | Actual % |
|---|---|---|---|---|---|
| Dennis J. Zember, Jr. (CEO) | 722,113 | 50% | 361,057 | 0 | 0% |
Long-Term Incentive (LTI) – PSUs
- Since 2022, all awards are performance-based, vesting after 5-year periods based on Adjusted EPS CAGR with the payout curve below. No equity awards were granted in 2024.
| Adjusted EPS CAGR | 2022 Grant Payout | 2023 Grant Payout |
|---|---|---|
| ≥10% | 150% | 150% |
| 8% | 100% | 100% |
| 6% | 75% | 75% |
| 5% | 50% | 50% |
| <5% | 0% | 0% |
| Grant | Grant Date | Target Units | Max Units | Fair Value ($) | Vesting/Performance Period |
|---|---|---|---|---|---|
| 2023 PSUs (CEO) | 11/16/2023 | 45,000 | 67,500 | 459,000 | EPS CAGR 1/1/2023–12/31/2027; vests 3/15/2028 |
- Zember Performance Unit Amendment: caps stock delivery and pays excess in cash up to $500,000 for 2021 (cap 50,000 shares) and 2022 (cap 25,233 shares) awards; 2023 terms are consistent with this framework.
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 199,767 shares; <1% of outstanding (24,722,734 shares outstanding as of 4/28/2025) |
| Unvested/Outstanding (12/31/2024) | 4,000 restricted shares ($46,640) vest 2/19/2025 ; 2021 PSUs 42,105 target ($490,944) eligible 3/15/2026 ; 2022 PSUs 42,105 target ($490,944) eligible 3/15/2027 ; 2023 PSUs 45,000 target ($524,700) eligible 3/15/2028 |
| Options | None outstanding; no option grants in 2022–2024 |
| Hedging/Pledging | Prohibited: no short sales, derivatives, margin purchases, or using company stock as loan collateral; pre‑clearance required for trades |
| Director Stock Ownership Policy | Non‑employee directors must own unencumbered shares equal to 100% of average annual board compensation within 3 years; bank funds a 125% stock match up to $25,000 annually |
| Employee Director Fees | Employees receive no additional pay for director service |
Employment Terms
- Agreement: Employment agreement dated February 19, 2020, amended and restated December 20, 2022; base salary set at $642,735 (2022) with future increases at committee discretion; company-provided $5,000,000 life insurance (50% payable to company; 50% to beneficiary).
- Severance: If terminated without cause or resigns for good reason, lump sum equal to 3x (base salary + highest cash bonus in prior 3 years), 18 months of employer-paid medical premiums, and full vesting of unvested time-based equity; if termination follows a change in control, PSUs are earned at actual performance through termination date (subject to the Zember PSU Amendment).
- CIC Equity Treatment (Plan-level): Time-based restricted stock vests upon change in control; PSUs vest at target if not assumed; if assumed, target PSUs vest upon good reason resignation/termination without cause within 2 years post‑CIC.
- 280G/4999: Best-net approach (reduction to avoid excise tax or pay full amount subject to excise tax, whichever yields better net-after-tax outcome).
- Restrictive Covenants: 18-month non-compete and non-solicit; confidentiality; defined “good reason” and “cause.”
Estimated Payouts at 12/31/2024
| Scenario | Cash Severance ($) | Health Benefits ($) | Value of Unvested Equity ($) | Other ($) | Total ($) |
|---|---|---|---|---|---|
| Termination without Cause or Resignation for Good Reason | 2,916,338 | 27,630 | 1,553,229 | — | 4,497,197 |
| Change in Control (No Termination) | — | — | 1,553,229 | — | 1,553,229 |
| Death or Disability | — | — | 599,771 | — | 599,771 |
Board Governance
- Board Service: Director of Primis Financial and Primis Bank since February 19, 2020; currently a Class II director. Employee (inside) director; all other current directors are independent per NASDAQ rules. Independent directors hold executive sessions without management.
- Committee Roles: Not listed on company board committees; serves on the Bank’s Asset‑Liability Management Committee with other directors and executives.
- Board Structure: Proposal to declassify the board beginning with the 2026 annual meeting; directors would thereafter be elected annually.
- Director Pay: Non‑employee directors receive retainers/fees; employee directors (including CEO) receive no additional compensation for board service.
Compensation Committee Analysis
- Membership/Process: Compensation Committee comprised of independent directors; seven meetings in 2024; composition updated March 20, 2025 (new chair John M. Eggemeyer).
- Independent Consultant: Pearl Meyer engaged in 2024; independence affirmed; peer group of 22 Mid‑Atlantic banks (assets $2.1–$6.3B; median $3.6B). Peer data used as a reference, not as a target.
- Say‑on‑Pay: Approximately 94% approval at the 2024 annual meeting; no material changes to program in response.
Related Party Transactions and Risk Indicators
- Insider Trading/Hedging: Strict prohibitions on hedging, derivatives, short sales, margin purchases, and pledging; trade pre‑clearance and blackout windows apply.
- Restatement/Clawback: 2022 financial statements were restated related to a third‑party consumer loan program; company’s clawback policy (effective Oct 2, 2023) complies with NASDAQ Rule 10D‑1 and prompted a recovery analysis (applies to incentive compensation received on/after Oct 2, 2023).
- Related Parties: CEO’s nephew employed by the bank with ~ $81,565 salary in 2024; loans to directors/executives/significant holders outstanding under ordinary-course terms totaled $17.6 million across 35 loans as of 12/31/2024.
- 2024 Earnings/Late Filings: Committee cited a reported net loss and late filings in 2024 tied to the consumer loan portfolio in reducing/zeroing executive STI for the year.
Director Compensation (for dual-role context)
- 2024 non‑employee director compensation included a $30,000 annual retainer, meeting fees, and optional stock purchase matching; employee directors (including Mr. Zember) received no additional compensation for board service.
Equity Vesting Calendar (Insider Selling Pressure Outlook)
| Award | Target Shares | Scheduled Vesting |
|---|---|---|
| 2021 PSUs | 42,105 | March 15, 2026 (performance based; subject to Zember PSU Amendment) |
| 2022 PSUs | 42,105 | March 15, 2027 (performance based; subject to Zember PSU Amendment) |
| 2023 PSUs | 45,000 | March 15, 2028 (performance based; subject to Zember PSU Amendment) |
| 2022 RS (time-based) | 4,000 | Vested February 19, 2025 |
- Policy prohibits hedging and pledging, which reduces alignment risks from collateralized borrowing, though vest‑to‑sell decisions will depend on taxes/liquidity at settlement.
Investment Implications
- Pay-for-performance linkage has strengthened: all LTI is PSU-based on 5‑year Adjusted EPS CAGR with a 0–150% payout curve; however, 2024 STI was zeroed for the CEO given loss and late filings, signaling willingness to exercise negative discretion. Expect 2026–2028 PSU settlements (at target caps under the Zember Amendment) to be key catalysts.
- Alignment and retention: CEO holds ~200K shares (<1% of outstanding) with significant unvested PSUs; strict anti‑hedging/pledging policy and best‑net 280G treatment limit governance red flags, but triple cash multiple on severance is generous, creating potential CIC overhang.
- Execution risk: 2024 net loss and filing delays tied to the consumer loan portfolio underscore operational and control risk; clawback framework is in place and was tested by the 2022 restatement. Monitor remediation progress and 2025–2026 earnings trajectory relative to PSU EPS CAGR targets.
- Governance: CEO is an inside director with independent committees and regular executive sessions; planned board declassification beginning 2026 enhances shareholder influence on board composition.